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SVB Financial reports significantly lower loan loss provision

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SVB Financial reports significantly lower loan loss provision

SVB Financial Group on Jan. 26 reported fourth-quarter 2016 net income attributable to shareholders of approximately $99.5 million, or $1.89 per share, compared to $87.5 million, or $1.68 per diluted share, in the year-ago quarter.

For the full year 2016, net income attributable to shareholders was $382.7 million, or $7.31 per share, compared to $343.9 million, or $6.62 per share, in 2015.

The S&P Capital IQ consensus estimates for normalized EPS were $1.79 for the fourth quarter and $7.19 for the full year 2016.

Total nonperforming assets were $119.0 million, or 0.59% of total gross loans, compared to $106.3 million, or 0.55%, in the previous quarter, and $123.4 million, or 0.73%, in the year-ago period.

The net interest margin for the period was 2.73%, slightly down from 2.75% for the previous period and 2.54% for the year-ago period.

The company's net charge-offs as a percentage of average total gross loans on an annualized basis were 0.44%, compared to 0.48% in the previous quarter and 0.28% in the same period a year ago.

SVB Financial's recent quarterly allowance for loan losses was $225.4 million, compared to $240.6 million at the end of the previous period and $217.6 million a year ago. The company's fourth-quarter provision for loan losses was approximately $7.1 million, significantly lower than $18.9 million in the linked quarter and $31.3 million in the year-ago quarter.

The company also recorded gains on investment securities of approximately $10.0 million, compared to $23.2 million in the previous quarter and $12.4 million in the year-ago period.