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Customers Bancorp (CUBI)

Customers Bank, a subsidiary of Customers Bancorp, Inc. a bank holding company, is a full-service super-community bank with assets of approximately $18.4 billion at December 31, 2020. A member of the Federal Reserve System with deposits insured by the Federal Deposit Insurance Corporation, Customers Bank is an equal opportunity lender that provides a range of banking and lending services to small and medium-sized businesses, professionals, individuals and families. Services and products are available wherever permitted by law through digital-first apps, online portals, and a network of offices and branches.

CUBI stock data

Analyst ratings and price targets

Last 3 months

Investment data

Data from SEC filings
Securities sold
Number of investors

Calendar

8 Aug 22
28 Sep 22
31 Dec 22
Quarter (USD) Jun 22 Mar 22 Dec 21 Sep 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Dec 21 Dec 20 Dec 19 Dec 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Cash burn rate (est.) Burn method: Change in cash Burn method: Operating income Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 245.18M 245.18M 245.18M 245.18M 245.18M 245.18M
Cash burn (monthly) 9.81M 15.44M (no burn) (no burn) (no burn) (no burn)
Cash used (since last report) 28.96M 45.6M n/a n/a n/a n/a
Cash remaining 216.22M 199.58M n/a n/a n/a n/a
Runway (months of cash) 22.0 12.9 n/a n/a n/a n/a

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
15 Sep 22 Bernard Bennett Banks Common Stock Grant Acquire A No No 32.65 1,056 34.48K 4,265
15 Sep 22 Allon Andrea R. Common Stock Grant Acquire A No No 32.65 903 29.48K 27,942
15 Sep 22 Zuckerman Steven J Common Stock Grant Acquire A No No 32.65 1,056 34.48K 57,571
15 Sep 22 Way T Lawrence Common Stock Grant Acquire A No No 32.65 1,056 34.48K 113,590
15 Sep 22 Rothermel Daniel K Common Stock Grant Acquire A No No 32.65 1,056 34.48K 96,863
66.3% owned by funds/institutions
13F holders Current Prev Q Change
Total holders 210 232 -9.5%
Opened positions 29 37 -21.6%
Closed positions 51 25 +104.0%
Increased positions 88 70 +25.7%
Reduced positions 64 93 -31.2%
13F shares Current Prev Q Change
Total value 951.21M 1.53B -37.7%
Total shares 27.75M 28.44M -2.4%
Total puts 330.1K 17.6K +1775.6%
Total calls 95.9K 162.4K -40.9%
Total put/call ratio 3.4 0.1 +3076.1%
Largest owners Shares Value Change
BLK Blackrock 4.76M $161.21M -1.7%
Dimensional Fund Advisors 2.4M $81.22M +5.6%
Vanguard 2.01M $68.27M +3.4%
STT State Street 1.87M $63.3M -18.2%
Basswood Capital Management, L.L.C. 1.06M $35.77M +25.1%
Victory Capital Management 889.11K $30.14M -10.9%
Aristotle Capital Boston 618.02K $20.95M +8.7%
Geode Capital Management 600.84K $20.37M +10.3%
Emerald Mutual Fund Advisers Trust 567.49K $19.24M +4.6%
Emerald Advisers 536.17K $18.18M +20.2%
Largest transactions Shares Bought/sold Change
Lord, Abbett & Co. 0 -1.47M EXIT
Driehaus Capital Management 0 -444.9K EXIT
STT State Street 1.87M -415.8K -18.2%
Thrivent Financial For Lutherans 436.93K +294.97K +207.8%
Two Sigma Investments 309.13K +242.13K +361.4%
Basswood Capital Management, L.L.C. 1.06M +211.73K +25.1%
Bridgeway Capital Management 415.59K +210.3K +102.4%
MS Morgan Stanley 359.38K +179.76K +100.1%
Parametric Portfolio Associates 0 -151.57K EXIT
Cubist Systematic Strategies 178.22K +149.49K +520.2%

Financial report summary

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Risks
  • Our business is highly susceptible to credit risk. If our ACL is insufficient to absorb losses in our loan and lease portfolio, our earnings could decrease.
  • Planned changes in the composition of our loan portfolio may expose us to increased lending risks.
  • Our emphasis on commercial, commercial real estate and mortgage warehouse lending may expose us to increased lending risks.
  • Our New York State multi-family loan portfolio could be adversely impacted by changes in legislation or regulation.
  • The fair value of our investment securities can fluctuate due to market conditions. Adverse economic performance can lead to adverse security performance and potential impairment.
  • Changes to estimates and assumptions made by management in preparing financial statements could adversely affect our business, operating results, reported assets and liabilities, financial condition and capital levels.
  • Changes in accounting standards and policies can be difficult to predict and can materially impact how we record and report our financial results.
  • The geographic concentration in the Northeast and Mid-Atlantic regions makes our business susceptible to downturns in the local economies and depressed banking markets, which could materially and adversely affect us.
  • We depend on our executive officers and key personnel to implement our strategy and could be harmed by the loss of their services.
  • We face significant competition from other financial institutions and financial services providers, which may materially and adversely affect us.
  • Like other financial services institutions, our asset and liability structures are monetary in nature. Such structures are affected by a variety of factors, including changes in interest rates, which can impact the value of financial instruments held by us.
  • Uncertainty about the future of LIBOR may adversely affect our business.
  • We launched CBIT, a blockchain-based instant payments platform, the development, acceptance and success of which is subject to a variety of factors that are difficult to evaluate.
  • We are dependent on our information technology and telecommunications systems and third-party servicers, and systems failures, interruptions or breaches of security could have a material adverse effect on us.
  • Loss of, or failure to adequately safeguard, confidential or proprietary information may adversely affect our operations, net income or reputation.
  • Breaches of security measures, computer viruses or malware, fraudulent activity and infrastructure failures could materially and adversely affect our reputation or harm our business including the unauthorized access to or disclosure of data relating to BMT serviced deposit account holders.
  • We intend to engage in acquisitions of other businesses from time to time. These acquisitions may not produce revenue or earnings enhancements or cost savings at levels, or within time frames, originally anticipated and may result in unforeseen integration difficulties.
  • Our acquisitions generally will require regulatory approvals, and failure to obtain them would restrict our growth.
  • To the extent that we are unable to increase loans through organic core loan growth, we may be unable to successfully implement our growth strategy, which could materially and adversely affect us.
  • We may not be able to effectively manage our growth.
  • If our techniques for managing risk are ineffective, we may be exposed to material unanticipated losses.
  • We are dependent upon maintaining an effective system of internal controls to provide reasonable assurance that transactions and activities are conducted in accordance with established policies and procedures and are captured and reported in the financial statements. Failure to comply with the system of internal controls may result in events or losses which could adversely affect our operations, net income, financial condition, reputation and compliance with laws and regulations.
  • We may not be able to meet the cash flow requirements of our loan funding obligations, deposit withdrawals, or other business needs and fund our asset growth unless we maintain sufficient liquidity.
  • We may not be able to develop and retain a strong core deposit base and other low-cost, stable funding sources.
  • Competitors’ technology-driven products and services and improvements to such products and services may adversely affect our ability to generate core deposits through mobile banking.
  • We may incur losses due to minority investments in other financial institutions or related companies.
  • We continue to face the risks and challenges associated with BM Technologies following the merger of BMT with Megalith Financial Acquisition Corp.
  • Worsening general business and economic conditions could materially and adversely affect us.
  • The COVID-19 pandemic has impacted our business, and the ultimate impact on our business and financial results will depend on future developments, which are highly uncertain and cannot be predicted, including the scope and duration of the pandemic and actions taken by governmental authorities in response to the pandemic.
  • We are a participating lender in SBA’s PPP program and have originated a significant number of loans under this program, which may result in a material amount of PPP loans remaining on our consolidated balance sheets at a very low yield for an extended period of time.
  • Climate change and related legislative and regulatory initiatives may result in operational changes and expenditures that could significantly impact our business.
  • Severe weather, natural disasters, public health issues, acts of war or terrorism, and other external events could significantly impact our ability to conduct business.
  • Our business, financial condition, results of operations and future prospects could be adversely affected by the highly regulated environment in which we operate, including the effects of heightened regulatory requirements applicable to banks with assets in excess of $10 billion.
  • We operate in a highly regulated environment, and the laws and regulations that govern our operations, corporate governance, executive compensation and accounting principles, or changes in them, or our failure to comply with them, could materially and adversely affect us.
  • Our use of third-party vendors and our other ongoing third-party business relationships are subject to increasing regulatory requirements and attention.
  • We are subject to numerous laws and governmental regulations and to regular examinations by our regulators of our business and compliance with laws and regulations, and our failure to comply with such laws and regulations or to adequately address any matters identified during our examinations could materially and adversely affect us.
  • Other litigation and regulatory actions, including possible enforcement actions, could subject us to significant fines, penalties, judgments or other requirements resulting in increased expenses or restrictions on our business activities.
  • The FDIC’s restoration plan and the related increased assessment rate could materially and adversely affect us.
  • The Federal Reserve may require us to commit capital resources to support our subsidiary bank.
  • We are subject to stringent capital requirements which may adversely impact return on equity, require additional capital raises, or limit the ability to pay dividends or repurchase shares.
  • We face a risk of noncompliance and enforcement action with the Bank Secrecy Act and other anti-money laundering statutes and regulations.
  • Federal, state and local consumer lending laws may restrict our ability to originate certain mortgage loans or increase our risk of liability with respect to such loans and could increase our cost of doing business.
  • Reviews performed by the Internal Revenue Service and state taxing authorities for the fiscal years that remain open for investigation may result in a change to income taxes recorded in our consolidated financial statements and adversely affect our results of operations.
  • The trading volume in our common stock may generally be less than that of other larger financial services companies.
  • We do not expect to pay cash dividends on our common stock in the foreseeable future, and our ability to pay dividends is subject to regulatory limitations.
  • We may issue additional shares of our common stock in the future which could adversely affect the value or voting power of our outstanding common stock.
  • Future issuances of debt securities, which would rank senior to our common stock upon our liquidation, and future issuances of equity securities, which would dilute the holdings of our existing holders of common stock and may be senior to our common stock for the purposes of making distributions, periodically or upon liquidation, may negatively affect the market price of our common stock.
  • Provisions in our articles of incorporation and bylaws may inhibit a takeover of us, which could discourage transactions that would otherwise be in the best interests of our shareholders and could entrench management.
  • Shareholders may be deemed to be acting in concert or otherwise in control of us and our bank subsidiaries, which could impose prior approval requirements and result in adverse regulatory consequences for such holders.
  • Our directors and executive officers can influence the outcome of shareholder votes and, in some cases, shareholders may not have the opportunity to evaluate and affect the investment decision regarding potential investment, acquisition or disposition transactions.
  • The FDIC’s policy statement imposing restrictions and criteria on private investors in failed bank acquisitions will apply to us and our investors.
  • The shares of our Series E and Series F Preferred Stock are equity securities and are subordinate to our existing and future indebtedness.
  • We may not pay dividends on the shares of Series E and Series F Preferred Stock.
  • Dividends on the shares of Series E and Series F Preferred Stock are non-cumulative.
  • Our ability to pay dividends on the shares of Series E and Series F Preferred Stock is dependent on dividends and distributions we receive from our subsidiaries, which are subject to regulatory and other limitations.
  • Holders of Series E and Series F Preferred Stock should not expect us to redeem their shares when they first become redeemable at our option or on any particular date thereafter, and our ability to redeem the shares will be subject to the prior approval of the Federal Reserve.
  • We may be able to redeem the Series E and Series F Preferred Stock before their initial redemption dates upon a “regulatory capital treatment event.”
  • Holders of Series E and Series F Preferred stock have limited voting rights.
  • General market conditions and unpredictable factors could adversely affect market prices for the Series E and Series F Preferred Stock.
  • The Series E and Series F Preferred Stock may not have an active trading market.
  • The Series E and Series F Preferred Stock may be junior or equal in rights and preferences to preferred stock we may issue in the future.
  • Our 2.875% Senior Notes, 4.5% Senior Notes, 3.95% Senior Notes, 6.125% Subordinated Notes and 5.375% Subordinated Notes contain limited covenants.
  • Our ability to make interest and principal payments on the Senior Notes and Subordinated Notes is dependent on dividends and distributions we receive from our subsidiaries, which are subject to regulatory and other limitations.
  • We may not be able to generate sufficient cash to service our debt obligations, including our obligations under the Senior Notes and Subordinated Notes.
  • The Senior Notes and Subordinated Notes may not have an active trading market.
  • Downgrades in U.S. government and federal agency securities could adversely affect us.
  • We may not be able to maintain consistent earnings or profitability.
Management Discussion
  • Customers reported net income available to common shareholders of $56.5 million and $131.4 million for the three and six months ended June 30, 2022, respectively, compared to net income available to common shareholders of $58.0 million and $91.2 million for the three and six months ended June 30, 2021, respectively. Factors contributing to the change in net income available to common shareholders for the three and six months ended June 30, 2022 compared to the three and six months ended June 30, 2021 were as follows.
  • Net interest income increased $26.1 million for the three months ended June 30, 2022 compared to the three months ended June 30, 2021 as average interest-earning assets increased by $826.9 million, and NIM increased by 41 basis points to 3.39% for the three months ended June 30, 2022 from 2.98% for the three months ended June 30, 2021. The increase in interest-earning assets was driven by increases in investment securities, commercial and industrial loans and leases, installment, multi-family and residential mortgage loans, offset in part by decreases in PPP loans due to PPP loan forgiveness and commercial loans to mortgage companies. The shift in the mix of interest-earning assets in a rising interest rate environment and PPP loan forgiveness, which accelerated the recognition of net deferred loan origination fees, drove a 54 basis points increase in the yield on interest-earning assets and contributed to the NIM increase. The shift in the mix of interest-bearing liabilities in a rising interest rate environment drove a 26 basis points increase in the cost of interest-bearing liabilities for the three months ended June 30, 2022 compared to the three months ended June 30, 2021. The largest shift in the mix of interest-earning assets and interest-bearing liabilities impacting the NIM was $1.6 billion ($1.9 billion average balance) of PPP loans yielding 4.43% and $6.6 billion ($6.4 billion average balance) of interest-bearing demand deposits costing 0.85%. Non-interest bearing demand deposits was $4.7 billion ($4.5 billion average balance). PPPLF borrowings costing 0.35% were fully repaid during the three months ended September 30, 2021. Customers' total cost of funds, including non-interest bearing deposits was 0.69% and 0.54% for the three months ended June 30, 2022 and 2021, respectively.
  • Net interest income increased $58.1 million for the six months ended June 30, 2022 compared to the six months ended June 30, 2021 as average interest-earning assets increased by $728.2 million, and NIM increased by 50 basis points to 3.49% for the six months ended June 30, 2022 from 2.99% for the six months ended June 30, 2021. The increase in interest-earning assets was driven by increases in investment securities, commercial and industrial loans and leases, installment, residential mortgage and multi-family loans, offset in part by decreases in PPP loans due to PPP loan forgiveness and commercial loans to mortgage companies. The PPP loan forgiveness drove a 46 basis points increase in the yield on interest-earning assets and contributed to the NIM increase. The NIM also increased from equity investment distributions, which are included in other interest income. The shift in the mix of interest-bearing liabilities drove a 4 basis

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