Butterfield Q3 EPS beats on higher yields, lower non-core expenses

Overview

• Bank's Q3 revenue was a slight beat versus analyst expectations

• Adjusted EPS for Q3 beat analyst expectations

• Net income rose from prior quarter, driven by higher interest and non-interest income

Outlook

• Company expects CIBC Caribbean acquisition to close in H1 2027

• Company says integration planning for CIBC Caribbean acquisition is progressing as expected

Result Drivers

• HIGHER YIELDS - Co said net interest income rose due to reinvestment of securities at higher yields and improved treasury returns, partly offset by loan yield compression and higher deposit costs

• NON-INTEREST INCOME - Co said non-interest income rose due to higher banking service revenue from increased card volumes and a non-recurring contractual incentive

• LOWER NON-CORE EXPENSES - Co said non-interest expenses fell mainly due to lower acquisition-related costs, partly offset by higher salaries and other expenses

Company press release:

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy."

• Wall Street's median 12-month price target for Bank of NT Butterfield & Son Ltd is $65.00, about 8.4% above its October 26 closing price of $59.95

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 10 three months ago

Reuters Recommended Reads

• Oct 27 - NBT Bancorp Q3 profit rises on loan growth, higher net interest income

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• Oct 26 - Bank of Hawaii Q3 net income rises on higher net interest income

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)