Chemung Financial Q2 net interest income rises on commercial loan growth

Overview

• US regional bank's Q2 net income rose yr/yr as net interest income increased 18.8%

• Company saw strong commercial loan growth and higher non-interest income in Q2

• Non-interest expense rose 8.4% yr/yr, driven by higher salaries and other costs

Outlook

• Company did not provide specific guidance for the current quarter or full year

Result Drivers

• COMMERCIAL LOAN GROWTH - Net interest income rose as commercial loan balances increased, especially in non-owner occupied commercial real estate and construction loans, mainly in Canal Bank and Capital Bank divisions

• LOWER FUNDING COSTS - Funding costs declined due to reduced reliance on higher-cost brokered and time deposits, following balance sheet repositioning

• NON-INTEREST INCOME IMPROVEMENT - Higher wealth management fees and increased fair value of equity investments contributed to non-interest income growth, reflecting improved financial markets

Company press release: ID:nGNX518g7V

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 1 "strong buy" or "buy", 1 "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 Chemung Financial Corp is $72.75, about 5.2% below its July 21 closing price of $76.74

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 7 three months ago

Reuters Recommended Reads

• July 22 - Parke Bancorp Q2 net interest income rises on higher loan yields

• July 21 - TrustCo Bank Q2 net interest income rises driven by loan repricing

• July 21 - KeyCorp Q2 net interest income rises on lower deposit costs

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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.)