Synovus Financial Corp. SNV reported fourth-quarter 2024 adjusted earnings per share of $1.25, which surpassed the Zacks Consensus Estimate of $1.16 per share. This compares with earnings of 80 cents per share a year ago.

Find the latest earnings estimates and surprises on the Zacks Earnings Calendar.

Synovus shares rose 4.3% on a better-than-expected performance.

Results benefited from strong year-over-year growth in non-interest revenues (NIR), a rise in net interest income (NII), and a fall in expenses and provisions for credit losses. Also, improving deposit balances was a tailwind. However, a rise in non-performing loans was a major headwind.

Net income (GAAP basis) available to common shareholders was $178.8 million, surging from the net income available to common shareholders of $60.6 million in the prior-year quarter.

In 2024, adjusted earnings of $4.43 per share surpassed the consensus estimate of $4.39 and rose from $4.12 in 2023. Net income was $439.6 billion, down 13.4% from the prior-year quarter.

Synovus’ Q4 Revenues Rise, Expenses Dip Y/Y

Total revenues in the fourth quarter were $580.6 million, up 18.8% from the prior-year quarter. Also, the top line surpassed the Zacks Consensus Estimate by 2.3%.

For 2024, total revenues were $1.85 billion, which missed the Zacks Consensus Estimate of $1.98 billion. Also, the top line declined 8.9% year over year.

NII rose 4% year over year to $454.9 million, while the net interest margin expanded 4 basis points to 3.28%. Both increases were primarily attributable to lower funding costs.

Non-interest revenues were $125.6 million, which rose from the year-ago figure of $51.5 million. The rise was driven by growth in treasury management fees, capital markets income, and wealth revenues.

Non-interest expenses were $309.3 million, down 12% year over year. The fall was mainly due to lower FDIC special assessment charges and a 2% reduction in total headcount.

The adjusted tangible efficiency ratio was 53.2%, down from the 72% reported in the year-earlier quarter. A decline in the efficiency ratio indicates an increase in profitability.

SNV’s Loan Balance Declines, Deposit Increases Sequentially

As of Dec. 31, 2024, total loans of $42.6 billion decreased 1.2% from the previous quarter. Total core deposits (excluding brokered deposits) were $51.1 billion, which increased 1.8% from the previous quarter.

SNV’s Credit Quality: Mixed Bag

Non-performing loans were $309.2 million, up 7% from the year-ago quarter. Total non-performing assets amounted to $309.5 million, also increasing 7% year over year.

Provision for credit losses was $32.9 million, which decreased 28% year over year.

The non-performing assets ratio was 0.73%, up from 0.66% in the year-ago period.

Net charge-offs decreased 32% to $28.1 million from the prior-year quarter. The net charge-off ratio was 0.26%, down from 0.38% in the prior-year quarter.

SNV’s Capital Ratios & Profitability Ratios Improve Y/Y

As of Dec. 31, 2024, the Tier 1 capital ratio and total risk-based capital ratio were 11.96% and 13.80%, respectively, compared with 11.28% and 13.07% in the year-ago quarter. As of the same date, the Common Equity Tier 1 capital ratio was 10.84%, up from 10.22% in the year-ago quarter.

Adjusted return on average assets was 1.25%, up from 0.47% in the prior-year quarter. Adjusted return on average common equity was 14.75%, up from 5.88% in the year-earlier quarter.

Our Take on Synovus

The company’s solid capital position will aid capital distribution activities in the upcoming period, boosting investors’ confidence in the stock. Also, lower expenses and provisions, along with improving deposit balances, will support its financials in the upcoming period. However, the rise in non-performing loans was concerning.

Synovus Financial Corp. Price, Consensus and EPS Surprise

Synovus Financial Corp. price-consensus-eps-surprise-chart | Synovus Financial Corp. Quote

Currently, Synovus carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Dates & Expectations of Bank Stocks

Citizens Financial Group, Inc. CFG is slated to report fourth-quarter 2024 results on Jan. 17. It has a Zacks Rank #3 (Hold) at present.

Over the past seven days, the Zacks Consensus Estimate for CFG’s quarterly earnings per share has been unchanged at 83 cents.

Fifth Third Bancorp FITB is scheduled to release fourth-quarter 2024 earnings on Jan. 21. The company currently carries a Zacks Rank #3.

The consensus estimate for FITB’s quarterly earnings has been unchanged at 87 cents per share over the past seven days.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Fifth Third Bancorp (FITB) : Free Stock Analysis Report

Synovus Financial Corp. (SNV) : Free Stock Analysis Report

Citizens Financial Group, Inc. (CFG) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research