SF - Earnings call transcript Q1 2024 | Stifel Financial Corp.

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Operator

Good day, and welcome to the Stifel Financial First Quarter 2024 Conference Call.

As a reminder, today's call is being recorded.

At this time, I'd like to turn the call over to Mr. Joel Jeffrey, Head of Investor Relations of Stifel Financial. Please go ahead.

Joel Jeffrey

operator. Thanks, welcome Financial's to Conference Quarter to Call. everyone like First Stifel XXXX I'd the our Zemlyak; today Ron joined call I'm on by Jim Co-Presidents, Nesi CFO, Kruszewski; Victor Chairman and our Jim and Marischen. our CEO, and

this page posted slide and at our which www.stifel.com. deck earnings on found to a can supplement we be an financial the Earlier morning, website, release issued and Investor Relations

and state I note our I refer as a of throughout we our some that on non-GAAP presentation that reconciliation would non-GAAP press our numbers basis, would to to of presented are the release. GAAP in disclosed

I material slide to Stifel our presentation of may not Stifel would audio reproduced and earnings our on to information This and statements Financial rebroadcast of forward-looking and supplement also consent remind duplicated, without the for non-GAAP Financial be listeners copyrighted release, or is refer Corp. measures. financial cast

I will Ron call CEO, the to and Chairman over our now turn Kruszewski.

Ronald J. Kruszewski

our good markets The for Joel. an conditions momentum Thanks, call. quarterly market as improving thank exiting to time we conference strong history. to included we markets, you the equity had taking our economy. second benefited XXXX We guests, first XXXX revenues highest capital the listen that from continued To our quarter generated recovering morning, in U.S. and and

as net of continued in the well wealth improvement $X.XX more revenue billion than management was institutional Total as revenue global driven by record our group.

in which as capital of of expense also which a X focus upgrade credit substantial ratio I'd share via well quarter with common and we during Even that margin, in from a excess Standard Tier revenues approach & increase our on business earnings by by our XX% we discipline substantial generation, This and primarily the of month. the operating agency deploy Poor's XX%. tangible X% on recognized year-on-year was improved, earlier $X.XX, maintained we increased was the resulted equity of share As increased XX pretax another a dividend, quarter. our note return points strength this this a as per share repurchase basis leverage the activity received repurchases. resulted

is to table variance X consensus Slide a estimates.

$X.XX EPS our expectations. than of consensus revenue beat guidance that items on came result million revenue net was $X.XX $XX and the of in range. Our note We income, I interest except higher within came was above all which net

and cash it's year, of well think note very point the to our sorting the of low anticipate be important for quarter as the I the that $XXX remainder during from million less the impact sheet growth of we NII balance may year.

where that In expectations to as stronger compared wealth terms management came levels. revenue. see above came activity banking consensus, and above million on to we The institutional Street note we advisory million are and in underwriting of revenue, stronger beat revenue increased in nearly Transactional as $XX equity $X beginning both I'd consensus investment on

higher consensus. were expenses Total than

billion, would Non-comp in later with net expectations. credit Jim as remained below note banking over has However, that Starting operating income, were in increased XXXX. in note higher XX% compensation XXXX. comp X than This much excluding XXX%. Management income investment business. In ratio in gross-ups, But our based a to was quarter XXXX would since greater million this of from since first basis, will that of on XXXX, was percentage expectations, I source our global million essentially I'd metrics Global our revenues. revenue a represents capital that it billion was deep and because $X our that out On $X.X noteworthy higher the recession This at which to other in our was that operating the with industry-wide a revenue. of provision group the ratio call. along noncomp volatility compares wealth essentially expenses of XXXX is interest revenue fee-based point growth and expense in approximately offset annualized I guidance. Slide Wealth a Wealth $XXX institutional compares markets breakeven that pretax discuss detail consistent revenues $X.X which institutional up consistent of result reflected offset XX% our Global in the is reduced Management slightly XXXX.

a rebound normalized Our investment results the of is far onset quarter it indicate first but in run a in the rate. banking, from

conditions returning this to anticipate segment. profitability improve, in more we historical levels As market of

would XXXX, particularly in example, not investment a know for $XXX banking. market For generated even we pretax I strong was which income, in million

return margins segment. As Management in we the to investments from benefit also revenue will made and our Wealth norms, continue to historical more we've

item year, rates rose. The I increased to is lower Last net cut. enabled noted a rates our result Fed from rate basis note the benefits our would which of seen smart $XX and in like interest a within the makes decline we've product, interest rates less maintain cash reduction One begins to Stifel smart would of Stifel million income. impact XXX to when sensitive we in client us point in as interest rate that the cash levels to

reduces XXX Given a interest rate. income on decline beta, million basis in $XX rate, of same carries point the the in deposit smart impact the on our growth updated to higher which XXXX disclosure net

XXXX. results as transition our me NII we leads see So that of contribution. generate This group, levels continue wealth we and from the franchise from to elevated improving to believe XXXX as to look for future, combination consistent strong our performance we will we management to institutional growth and

turn me Jim With our call results. discuss quarter that, most to recent Marischen over to let the

James Marischen

everyone. good and morning, Ron, Thanks,

on at of Slide X. the our quarter details Looking first results

X% The partially interest and net of $X.XX lower revenue and offset was stronger driven was client billion advisory up net was by income year-on-year. quarterly by underwriting Our increase trading revenue. revenue that facilitation,

expense than was from higher revenues prior growth. modest Our count lower and offset X% up share EPS the as year a more

and were XX% Management margins on a $XXX segment on Moving our Global million, management asset pretax in transactional record growth results. and strong Wealth to record revenue our revenue revenue. was

We our advisers continue new to add to platform.

advisers advisers. of the sequential $XXX and mid-single of $X.X assets total with included billion, respectively. new quarter, and with client and XX were The in organic due we as of grew digits. quarter ended experienced production assets XX During added growth This billion the higher net $XXX markets record We million. our increases fee-based XX-month total a equity trailing to the assets

Slide longer-term We X. Management our growth business highlight our on of drivers Wealth

the and has recurring Our to sources continue the such recruiting by best-in-class of revenue generated has our from contribution with long-term has now revenue interest but asset to advisers segment and stands as net significantly our our focus been at on only approach success. this Not supporting management XX%. increased service income, percentage increase, and

Slide range deposits and interest of where lower impacted at higher the as solid Moving interest net our X, into banks. trends on third-party by million bank. we the costs, movement bank Net half the income guidance back cash of highlight margin to in of the was sweep deposit $XXX was balances average larger

million management and fourth of the recognize to revenue of timing bulk the the $X.X first as banks Given asset of on the the quarter impact in at this the move management sequentially. from third-party quarter revenue increased asset NII third-party end we XXXX, banks of

offset forecasted, reduction Bank $XXX the sweep million, third-party by the than quarter $XXX had first deposits was by slow. sweep sorting we by cash to impacted the increased more but by quarter, balances million. seasonality continues during in of As but

And $XXX quarter Given and similar results. cash in higher to our NIM, forecasting sorting range NII first be bank similar expect will million. expectations our the to we're of a for as million quarter modestly that we $XXX second such,

credit reserve Our profile remained metrics stands asset basis strong. And ratio XX the points. at and nonperforming

total was by our basis decline result which XX provision million credit $X.X ratio was the the Our to allowance loan loans quarter in totaled of as paydowns loss impacted fund and in balances points, a for banking. consolidated

be continued credit to basis CLO continues increased portfolio note capitalized. bond improve well XX.X%. tightened that to as sequentially losses sheet unrealized spreads balance capital in points in our XX leverage our also market. Tier X I'd to the the Lastly,

the the saw institutional to environment for segment quarter, continued next improvement million where as first revenue slide, On our Total I'll the the $XXX was continues discuss in in we a in up a operating totaled group decline capital $XXX increase in growth and year-on-year, offset than capital revenue. advisory investment more led substantial revenue. raising banking transactional million and revenue by Firm-wide recover. raising X% strong

investments the million generated we in had where made underwriting, $XX vertical, strongest the was fourth from we we've equity care of since XXXX significant terms of years. recent our our contribution health quarter a In as quarter meaningful

Advisory revenue closings. care in health verticals. in we $XXX delay were by was had our results impacted deal industrial solid the We and again million as

from X% resulted Equity was from failures comparison that strength. market our quarter. the showing totaled XXXX, are year's $XX positively of million, as U.S. quarter by last of pipelines impacted was However, a that M&A commissions which volatility up during the is improving transactional revenue were first tough as bank which the signs

to to I as lower of million revenue in that raising what gains revenues we experienced quarter. in an our business We our continue the transactional significantly growth from flow well $XXX in would capital of activity our million, XQ best-in-class generated fourth $XX fixed note see than 'XX. but million engagement our net income continue trading in electronic we were traction increased strong in year-on-year. both We with as high-touch as trading strong Fixed offerings strong research. gain transactional income increase $XX and experienced and

be transactions leader revenue in greater taxable income seeing the we in raising continue in our municipal increased activities, negotiated also traction capital underwriting our underwriting We're ranked and as which to in improved XX% activity market from XXXX. we business be improved 'XX, as number share XX% continue of #X was a Fixed year-on-year. the than increased, XQ to as

On the we through go slide, expenses. next

early transactions, year. end operating provision Our first at full we as and to related banking the excluding credit the expenses loss quarter XX%, is expenses, high totaled the which comp-to-revenue year approximately accrue our of in was conservatively investment the ratio guidance million. in $XXX Non-compensation

tax positively but came the benefit in XX.X%. was related The OpEx noncomp tax as rate losses. a foreign offset by quarter nondeductible impacted the by was effective tax at stock-based revenue XX.X%. Our excess of during was compensation to percentage The rate

compensation the let approximately X.X first I million our through repurchased net equity-based open position. the quarter, of settling market back call Ron, purchases. turn Before we over In me capital to both and shares discuss

we on of remaining million the authorization. end shares quarter, the of our have As XX

We capital X a have excess on of based XX% leverage Tier approximately $XXX million target.

generate first of quarter $XXX net of as our cash to illustrated excess continue income million. we by amounts Additionally, substantial

shares. million assumption in price, We a we'd generating remain making returns reinvesting and be share share expect share capital, done acquisitions we've strong through assuming repurchases. additional stock business, diluted as any Absent stable this the count quarter fully as to the through XXX.X well repurchases risk-adjusted for focused on deploying when and second

with let And call Ron. over turn the that, to me back

Ronald J. Kruszewski

consensus in first the annualized first of that our year at both those I a start that Jim. I year, in off quarter of revenue, full the said already that Thanks, good last would I and stand my the estimates. outlook XXXX for market aren't so our statements. near was a would quarter overly At add by midpoint end looking be Simply and conditions guidance year are transition revenue in to far XXXX, EPS we're despite exceeded we accommodating. optimistic. XXXX

to persistent The by the and geopolitical as our could for U.S. negatively not year elevated a risk potential the inflation, is of the outlook presidential impacted crisises, uncertainty the be elections, without remainder market just few. certainly of ongoing credit deterioration name the performance

this the beginning recession. were rate and camp, a also at and XXXX, justify XXXX Reserve between desire and although successful by position, cuts X the that believe to we precarious It's cycle market XX-year soft reductions. rate inflation policy. of now The increase X X of itself rate hikes in rope inflation even Fed's stand an inflation them anticipated series the in has the not slowing Look, Stifel view, to to a economic highs. cuts. at projected finds the the achieve of rate Yet was and would are the of reached a Cheap to I cards. we among X not rate numerous Speaking note to task. in controlling begin a X We that navigating that X landing. tight Fed the a Fed in unprecedented market Federal reasons this preventing to easy cuts. rate

the rates, progress We rate may ensure lower too at Fed now invigorating and reducing everyone, important recognize undoing cutting soon pressures would attempt we unnecessary significantly should than the is near ensuring to While of has target X% it risk a at rates landing. like both that that made seems Simply, reignite not inflationary will and believe and for inflation more cuts inflation opinion, if rate prove or the risky the is Fed so that and plenty trying sticky is rates economy. of our in Fed's stated soft the should slows inflation. The of economy the flexibility far. preemptive

we said, conditions market seeing improve. That are to continue

investment Specifically, we'd If transactional and position heading expect put efficiency activity. I'd year-to-date XXXX. increased remainder into banking, point trends Stifel strong increased would This throughout very to year. sentiment improve client a continue, the for market improved to revenue growth strong and on operating performance these of the see equity

cycles. to maximize create conclude value for Let shareholders and market through our me by are all that returns we saying committed

generating hiring through do acquisitions, best clients' of returns risk-adjusted needs $X in deploying discussed on this is of earnings and reinvesting continue essential revenue always will based our first. approach business Stifel near-term strategic in share. and to reaching capital putting per $X and targets our and over have This I've about our that the We by to billion

essentially this is consensus projections. would analyst XXXX note I that

client goal Additionally, you've heard trillion about our assets talk under management. of in me $X longer-term

would While that annual is in twice be growth, that of I business billion I revenue. level current asset recognize roughly generate the to this our size. scale believe $XX our at essentially

was rates. historical However, my bolstered by reaching confidence these in our levels growth

revenue. recently we between XXXX, the XXXX period and As our doubled annual as net

and individuals organization, constantly to milestones like revenue that achievable, high-quality these we over the company, not an As continue exceedable. attract as growth a adapt and are continue believe as think next decade, I client we, to asset if and

that, And with questions. for the operator, please open lines

Operator

take first Citizens will Devin We Ryan from with our Instructions] question [Operator JMP.

Devin Ryan

have you First the at recent question, just you really of to a on great to perspective business have want size just And thinking to back it give that. years, because pre-COVID maybe kind built extremely the have the from the were that relative clearly and the evolution last the of investment guys around increased how years here. from in maybe just take guys couple good banking of capabilities be other years. look few last And XXXX, and business to about that of you where been some may anything in step normal revenues side

all about that think like don't look so of for you of would a just like And those seem kind to could It get investments? a environment to XXXX ballpark need that normalization trying what Stifel back because of to into something revenues.

Ronald J. Kruszewski

It a the requires compare products, it's as look that producing what think business, across question. just Devin. to but of directors, XXXX, firm banking, greater saying investment are significantly is in evolution people, ball, managing institutional of terms I the our just the you great capabilities confident a little not crystal of a But bit senior and in I'm services in and of the business.

leads more relevant and more business As just That's business. to you to of are the your business. cycle to the do more continue clients that

happened, any margins will in business. But my little revenue, it, least acceptable we'll for for including that little look, watermark, that a in be think that that phenomenon back watermark get a there's we've everything of time, while, everything can XXXX that question high as and high looked to we as this while in being at at a think SPACs don't the a together opinion. came I I at

like that $X.X billion And $X.X being billion. we of to we've say instead said billion, XXXX more $X.X

the improved. to getting some be even will that is achieved in the broke yet business year remarks. that, profitability think a my business course, of important going thing that improves attainable. corporate still And profitability to we where that and And results last part easily I I as of great targets the that's from back essentially mentioned

James Marischen

just So behind to Ron by managed increased increased that. number some XXXX. about talked capabilities, people directors, of the managing more numbers directors XX put We've from

significant So fairly it's investment. a

I group would We've key capabilities we've some financials product our of verticals. investments we've lot with best-in-class made a in got our a also of about talked of in added. reference our You heard in say results franchises. care by this investments KBW. the on health made you being in industrial some and the And we've times investments call, our the multiple us generated our

add to just that. I'll So

Devin Ryan

Okay. Great color.

Just then just from loan bank, declined bit follow-up doing. guys sheet you have the would appetite buybacks In market seeing love real the growing loan the Jim. for leaning just been also obviously, the in get book the have around balances in some a just of quick today? to kind risk-adjusted last to kind an I'd the for a of from here that balance loan on grow quarter. or flavor And you're environment interplay the kind here versus between returns book of

James Marischen

I loan kind hinted we well seeing the specifically do Yes. we as some anticipate portfolio. balance to I think this sheet of that remarks mean, growth, is prepared in the in

growth I loan think historically the more in you areas will see we've grown.

think about continue we're all as banking If in. banking to are areas those mortgage fund and portfolio, to as invest our well going that venture you

the going focused table of of that's something there. some And are consideration. I of look in and we generating of balance generate think of growth as today, It buyback time balance does loan returns take terms think start and you part the to yield some I see the can adding capital sheet get we thinking we're is to balances, that on. sit versus can generate those balancing a definitely about at things here but excess kind we And and lot in

Operator

our TD next question of We will take Katz Cowen. from Bill

William Katz

those up following last of sets questions. on Just

higher of outlook? sort to grow interplay versus interplay do about calculate the through longer the your extent the sheet ahead balance to for looking to of NII that the the to guide. sort think are we if NIM through How think you between rates opportunity NII As that between the

James Marischen

answer the bit think client a to that going to because have is impact understanding the an on predict and that in predicting I environment NIM. little hard behavior is to

see we that continue said, to sorting there see But was continue cash an every year. obviously, tax we've As we season to impact associated slow. with

thing the the to as and continue to even to get just pressures, these and tax That opportunity we yield sorting think monitor I allow target. loan returns if and this industry we've from risk-adjusted further grow not saw make the about to built Stifel continue that we away to additional we would the to key we continue happens is there season. the across to further on the what said, think balances, portfolio capabilities us reasonable

pressure So if continued with do like. looks comfortable there is even that there, what we feel environment

Ronald J. Kruszewski

I it Yes, SOFR as that that an metrics. the client would sorting on curve inverted significantly just and yield always various rate add relates been behavior pressure the on put can inverted And I've in to frankly, the is both environment, that cautious cash activities. credit

growth, So we limiting of a have we we and see, from sheet our though, see point, this balance lot quality been demand.

impacts balance that at we're we as NII. that we growth will in part said think so sheet a remarks, my at be NII So sorting cash offset believe whatever that low I our by as it

William Katz

Great.

theme, one level sticking April as with just [ deeper, Just that think sort you through ]. just of

stick assets the the in rates of here? here vehicles think minus inflection in to do maybe money one So we behaviorally, how on might comment might And mix from move, of stay stay you migrate more And I sweep sort market, you and you favorable might as where framework of sort you look just rate what or what vehicles. funding see when versus in liabilities? are any percent your client more that? if a tax plus how is of then in stay could the of start world higher-cost wonder clients might That

Ronald J. Kruszewski

things. Well, X

estimated to in That's generally wiring they with where -- of exasperated every you and First season every government, and by the some be clients, deal account. year, of tax tax that out payments. the all, have accounts also out of our federal to money brokerage make can years

you strong quarter, a have gains. you capital might So some first had more

normal the say, whereby and you So out I it it wire would Thank various to federal products activity, we just government. our see of cash clients what much. very take

taxes. just it's So

to relates cut the behavior, rates. will will be interesting because and when it point, it As at some client begin to Fed if,

been to a I'll I if probably probably could going to Chairman would the you Fed for might happen the on say decline, could the happen. handle be I you as rates, as think some the the some But about funds rate. day, market they we duration start a to rate snap but be ideal, rate have X% that Fed flat need like much really be your to that of we what got fingers an for products don't wouldn't and clients, and X.XX%, That will like aside, that to be short-term we curve for rate beginning that which to cycle, just need the as as clients rate you're sure our not rates be just cuts not that think, as want We've to smart would It maintain do that adjustment. make have rates. we inverted. if ahead of thinking the alternative Meaning reach about and signal I X-year.

to will, We might the what our as curve terms clients normalize. want yield do to begins might in yield the curve of

James Marischen

about our assets obviously, fair Client and for obviously, much sidelines some I but number that And a the of that's relative on sitting turn that's to higher somewhat today. have mutual money Private that's a kind going of already those think rates point, dollars moved we One that's I that client Group some really earning elevated. to that investable funds. stay if $XX rates have see potential norms. revenue back at amount add is we And probably come from are If of big longer, to today within go stay historical aren't around down, market thing short-term here, can billion allocation treasuries that other up would into pretty

Operator

our take will Steven We question Research. next from Wolfe with Chubak

Michael Anagnostakis

of fiduciary versus the relatively back off peers rule. had rule and the been with on Michael, I Ron for and I on in to in the Ron, implications DOL some at of conference hopping cautious wanted one start November. the it's the Steven. you Jim,

final rule us this you can means the you well? for published, With Any that earnings for there? implications industry? remind Stifel's maybe the would as What highlight now your views

Ronald J. Kruszewski

preambles Look, mean, it's with yesterday, Yes. about was and pages things. published various I XXX it numerous

was at an As of maybe that initial least the what a surprised I restrictive blush, say, review rule to first somewhat I proposed. want be appears less was to than

that the not a in is administration a of think one rule back to to was so struck I number people it Circuit that in similar the was. trying XXXX that are create down whatever by the Fifth or

to I with so that primarily say just would that sell the indexed fixed rule which And we targets at really don't Stifel. say it's annuities, really

challenge probably would is that, say draw from the I However, legal a going to groups. insurance that

do rule like can have rollovers. things thought is you that principal legal continue some ours, investor be wanted was choice able IRA that you still they the was I which of that to But for to. IRA that appears you probably susceptible to concern in IPO challenge. that to it And a it they The from in. did put education back transaction expanded mostly should interesting an if And they always your

So think year. rule an period implementation has about a I of on balance, the

it get as our But really a as -- it think it business I lot We've Reg challenged. significantly seen I've it's BI, implement think I see done impact to today, the to going I now. BI. doesn't

BI, know very that. retirement I taxable reaction Most that appeared that that operating has under be manage. varies, so that they I'll is came to have becomes blush proposal of lot month be back extent it I look dial it the it Overall, looking accounts, and industry IRAs Reg ago. to difficult to my that just that. a our to a to we at guess first of the going standards. X to But say continue clients from was always the then I at thing have or can't the and out variance same

Michael Anagnostakis

Right. one And on That's just very helpful. bank then M&A.

headwinds for deal among there? M&A bank of while, up? the maybe that a cause out, a to are us close potential picking lingered environment can bank Lakeland Following round the give just it to administration on for current the expect dialogues the quite that will the candidates outcome? view of in had Or you you the merger sense the continue depending space then And evolve election to how is

Ronald J. Kruszewski

been don't some sure maybe wasn't had gave around Lakeland for has That that a you sitting while. know, I closed. deal me I information.

it we think think it... if close and will I

Michael Anagnostakis

misspoke. about that, the... Maybe but I I'm sorry

Ronald J. Kruszewski

That's right. number of all different thought do and closing. We that's processes think a price transactions. assessing of That's does to put to the and to how a I in has all close. I overall, a out risk and FDIC into to putting don't manage if factor right. transactions. delay I what's and it and -- That's In see not ability That considering put do it this general, going delay to in I'm continue. expect continue. to part my anything been think guidelines And we the why as I'm as look, it relates and M&A, if the on the having a Board, a -- guidelines administration clearly will

to fabric M&A hopeful States the and Capital of the will lot of the encourage going not good but administration, enhanced the a is that But need administration XX. that Markets, could would more hopeful United combine to whichever X,XXX also foundation communities after November, for has only activity occur, there we for that's community will a of banks. shareholders be lot over at We banks because I'm liquidity banks, recognize enhanced don't its which that meet to bank than -- else. need need So and mergers it's I'm it -- and midsized everything regulatory regional and

James Marischen

thing the from one significantly. think announcement -- has I to the obviously, to time line there add close is, extended of

feel going are very they've positioned that's to from for we're take financial here. And that would if like the where I to think well clients from conducive advantage like We I switches they more hearing to get say just of don't gotten longer M&A, to feel be any environment that. we that point the

Operator

from question Hawken next with our will Brennan We UBS. take

Brennan Hawken

I So commented gross drop Jim, what remarks, quarter, the XX XX advisers that healthy despite added, you FA quarter-over-quarter. count that in the prepared the dropped drove in you you by but to speak about your adds? head believe, Can

James Marischen

was primarily It Yes. driven by retirements.

I think early the you that see often. year in

generally slowed recruiting a of little pace think, speaking, bit. I the has

the attrition of more number there. of that we're terms of net seeing similar some so the to And a natural in trend new was what really from added retirements we is advisers. And

something of I seeing kind decision think typically, time like the little across today. they see to the when moving a industry take you have make moved, to you're think transition, I that's markets advisers and

Brennan Hawken

those have retirements, do finance of retiring maybe that? anything around FA a younger like able you any retain or you portion or what to you have move to are When books advisers to adviser those stats

Ronald J. Kruszewski

are that to have We advisers, retirements don't it's we them We look obviously too. those those like And are changes going published. that so. say, intergenerational would challenge, with that have assets incentives assets to those that. give I for do retirement, going most our firm, through retained through books. a transition the if them programs are often we at stats there's their generally We at assets advisers

but do challenges sometimes have we to there's so to programs from that, higher kids, you the parents too. go And

when a retire else which retires someone they thing. When when good. that good believe When attrition, low. somewhere But is here, it's necessarily look good at what's we a good that's that's someone want something, at retire our thing. a leaving or you net-net, So not to been thing, that's not regrettable has to Stifel,

Brennan Hawken

the third-party And seems if more, balances somewhat why And in decision elsewhere reflected $X.X banks nitty-gritty, those that or as drove banks. off... third-party were of squeeze billion one in are technical just though maybe those the could it. move deposits I net -- the supplement? what other but to are it Are at Got

Ronald J. Kruszewski

I'll one. let that Jim on

James Marischen

Page at of supplement, look billion you if the can the So see X roughly of bank you $X deposits. other

So banks. in of the in over essence, we deposits venture moved to billion primarily late about quarter, $X.X third-party

just of in and was lack hand the Some growth function that of cash that on at a the the first saw the bank we of quarter.

of million. but growth -- you if And That's were say, or the essence, can last did other deposits. about you to in billion, drove of you in these unusual billion we program million deposits billion $XXX the that, is sorry, would venture $X think billion, venture here I increase. terms to about add deposits fairly of were consistent suite off move through has a Venture time we over we corporate $XXX either the that the balance the in quarters you about $X more sheet deposits. that. deposits pace $XXX about through back there been probably in So see yes, $XXX nature, million. just $X.X first This the that $X.X few up million can you the

Operator

with We our from Goldman next will question Sachs. Blostein take Alex

Alexander Blostein

Just question a far loan goes. demand around as as your comments growth

seen you couple sounds and we've little bit. the have guys it to been for quarters, a sheet balance last extend So like that of of the sort reluctant

that to likely you your it want which buckets a sort to more. little the the is drive demand on bit around that just Now seems you Can little like to referred characterize comments lean you in growth? a high-quality of

the fund topic, around same but has then -- area the bank been loan, that's banking down. an been focus, of know I the And

driving do of decline? how gap bridge kind expect guys been you And to growth? of what's loan So sort the the to

Ronald J. Kruszewski

let in little we've loan was and were consumer yet Jim we what that do from going to I'll a detail. bit. our type remix we had primarily areas. continue perspective, But have give sheet balance our said demand, Yes. little to strong And my a

we've broadly just -- some our net necessarily relationship. while see be not lending that to been interest a holistically loan balance you're loans. much." sheet want group. We deals We have from more income sold more fee So were you income, achieving and "running don't not of syndicated part as our We some growth, just renew

of So that. remixing you've a of seen sort

a I that that on. seen I of be loans, -- getting we're maybe which loan growth, net we'll as much frankly, just think going now as offset haven't we've the lot fact won't been that, by It and just just has we would say. renewed some see

James Marischen

a investments made efforts. across fund venture bearing we've it's think banking our number fair. both Obviously, those banking And still are of fruit. I and

a amount of banking changes we basis, fair And a And lending as short-term us been fee deposits. from see more as seen income side, I there. both other have more banking you've of basically a the forward, of to that's or we driver fund we go mentioned, and teams. on more opportunities other transitioning think the venture Ron On fund been for allowing bilateral had capacity the

Alexander Blostein

of you. always it's But packages. got a that's changes I degree and know asset framework, And pay maybe directional any always And are part can think rising around you And characterize the the the pay competition Stifel's recruits there's side been net mix the help more same-store channel? you chatter about things, as on the competitive. little sales? bit competition I economics have you and the recruiting of for of contribution, versus provided between noticed just us in that and new

James Marischen

out broken not and sales. we've mix between a recruits same-store Obviously,

new assets, your managed, I in look net at XX numbers reporting total competitive it's do we months? where total Is the at months? Where holding one think at very point months? and someone being no peers after assets that it your and with are you consider X break of those fee-based where year-over-year, in others changed we it own those our directions what do total think moving and and terms fees of recruited? you net higher period-over-period, way X do percentages look sequentially Obviously, generally assets are asset new assets Or you longer things but which there. are that? you particularly drive are both when

Ronald J. Kruszewski

assets obsession, I under profitability. I between growth I lot about our are Yes. draw look the very and revenue that feel And and our in and in at person that always a view, productivity I that good double growth, a but trillion, our of I'll our always asset $X growth administration can't historical I've look, like those. really historical the almost to commented by metrics, want net said, and line improvement I look our to the metrics and at, stick to before don't say new by I

Alexander Blostein

your cleanup yield don't $X.X And Jim revenue billion up on the And Got of that the because where think moved I on that just back business? wealth just does to sweep. show for a that? in it. it's The Brennan's What's question as well.

James Marischen

The is up it up that fee minimis show It in significantly because to was asset Global -- what quarter. it's third-party de the well, It within on going than Wealth get lower we Management for on capture rate management shows line. the sweeps.

the Just given to the on relative inherent deposits rate those sweeps. interest

So lot amount of that less yield. or to It's deposits. to relative do And room off income. relatively you're around sweep deposits there's something basis top venture so on talking it's basically you're the taking because a there the fee points XX That's minimis. de an in

Alexander Blostein

it. Got

bank to if But is it want the Okay. fund you whenever there's [ use could like move point the ]? loan the you being you growth, can back over

James Marischen

make people the billion we an loan understood Page as shown to wanted of forward. go to that's just We growth on X $X.X not Correct. sure fund additional supplement

Ronald J. Kruszewski

have I going a okay, quarter, be questions... not in on next of that the number feeling it's to foot,

Operator

We will Allen from question take Chris our next with Citi.

Christopher Allen

trails outlook was the some one quick principal driven transaction credit a just on brokerage or rate-related color quarter, commissions on nice products is by fund there? and appetite for a principal just what Management kind and mutual just Maybe commission, obviously, Global what's both Wealth the Maybe more transactions. of revenues,

James Marischen

equities trails, fund on basis of increase those Most and driven by are was up we mutual the the sequential nicely. saw activity built

saw engaging pretty I client returns think lot of people as the that the market, spurred market a saw in we some you I attractive in think and behavior.

Ronald J. Kruszewski

levels activity. both I it's -- and look, to mean I trails Yes. market and correlated

and So improving, line good different. was in that no transactional item markets generally that's will this result

Operator

from We Cowen. question our will TD Katz next with Bill take

William Katz

a that's you aspirational. So [ my $XX laid with out, revenue I calculate have and ] Ron, your you number billion here bit on me kneel that around little appreciate rather

of that a the about given versus margin the years, one. questions be earnings against does just of today quickly couple company? platform a commentary compound through of aspirational of -- number just time of thing the all frame last then model more underneath a And underneath that, applying what kind just we little that stronger of So into should having related. the relatedly, power the kind couple target sort What

Ronald J. Kruszewski

that's I Yes. I going you'll really I mean, appreciate it. question, to forward I'm I Bill, and answer that -- looking. Look, the hope appreciate But the -- not

is. all we all, I firm in I of don't when and said to at billion. I've back aspirational had First of revenue to XXXX, that million. $X.X aspirational million I'm going my $XXX said, market that, done how of ability these were that we've comments got we went businesses say, and doubled people our lot we $XXX say know is across we've that, to we when?" gain wouldn't" had by we million $XXX because runway. we that And the do then I open and of "Oh said it gosh, doubled firm the and to we'd our a to continued share "Well, and still

management rate, And They take you're look assets case, trillion billion so to are when in plot aspirational not our correlated. of of I back our but growth and management, wealth $X if our and milestone calculator, assets. those, trillion is in correlated see put you'll go -- look about and at are and as $XX historical an $X that billion that this revenue which, the under to talking you and our you ground, at a goal, $XX institutional and business

growth that a we the and believe a to want been that not and end journey. company company, at fact we growth of just I we're the underscore we're So have this

$XX and from trillion capital So scale. just are be management, I'm in assets of billion margins $X will proper confident at that our higher

will And Our returns I'll not into. be higher. really than that, it. appreciate Look, will calculator. it, look I'm me more going to our at Much Send happy. okay. get I shareholders be your

Operator

Research. Steven with take will next Wolfe from Chubak question our We

Michael Anagnostakis

again. It's Michael

grow the sheet like to the quite million repurchase to decent during at Is ratios But same see balance zone year. are the It cash near time, gens capital strong. Just very Free $XXX term? one or are reasonable $XXX guys the quarter. this question flow planning more in still you more more on improved still this million here activity a nice healthy. capital. was amount Your

whether understand should maybe So I just to it or wanted we not XXXX rate. the to to return run expect

James Marischen

talked the to And obviously, buyback So about we've allocating sheet balance activity growth. obviously dependent. more all is capital price

this That term. case. senior pay the we have off. point, do in see would due may offering some near be a in July. just one slow very that that you We comes that fully the may So At debt

look So to the more well. that as this year, probably the buyback I those normalized as may of back at anticipate we returns that activity think half would some into of play levels. But I that,

Operator

[Operator questions We I the today speaker not the Instructions] our queue. remarks. to have in call over any turn closing to do for back would like

Ronald J. Kruszewski

I'm always, optimistic again, reporting to thank quarter the at everyone the as second summer. for about look this would, look time Well, results and markets quarter our first results. I our general forward taking to in

have a very you much. that, Thank everyone, with day. great So

Operator

you Thank call. today's for your participation. concludes This

may disconnect. You now

Stifel Financial (SF) 24 Apr 242024 Q1 Earnings call transcript