Richard P. Smith, President and CEO of TriCo Bancshares (TCBK), said the bank’s merger with North Valley Bancorp will create double-digit EPS accretion beginning in 2015.
Smith spoke on July 29 at the KBW Community Bank Investor Conference.
“We are continuing to be a steady dividend payer over long periods of time, for decades,” Smith said. “We still think that’s an important component of rewarding our shareholders.”
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Smith said the $3.5 billion community bank will have about 80 branches from Bakersfield, Calif., to the Oregon border, with market share in the top three for 15 of the combined bank’s 26 counties of operation.
Cost savings from the merger are expected to reach 40% of North Valley’s 2013 third quarter annualized core NIE of $36.1 million.
The bank’s average cost of deposits of 0.19% and its NIM of 4.19% position the bank for revenue growth, Smith said.
Deposits include 30% in noninterest bearing deposits and 36% in savings, Smith said… Market share of all branches is about 8.34%, ranking the bank fourth in its markets behind the much larger Wells Fargo, Bank of America and Rabobank.
Noninterest income has consistently represented a little over 25% of the bank’s total revenues, Smith said. Nearly 55% of the bank’s loan portfolio is in commercial real estate, with 18.99% in consumer HELOCs. Residential real estate lending represents about 12.25% of the book.
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