President’s Message
Staying Strong, Competitive and Caring
The number of banks in the U.S. has declined considerably in the past 25 years, from over 14,000 in 1996 to only 4,960 in 2021. Banks — especially community banks — are under pressure to grow, stay relevant and attract new customers, all while remaining profitable and strong. I am proud to say that, through strategic thinking and our incredible customer service values, Bank of Utah continues to be one of the nation’s top-performing banks.
In terms of Return on Assets, we rank in the top 5 percent of U.S. banks for how efficiently we manage our assets to produce profits. This means Bank of Utah can continue the independent, steady, community-based banking that has made us a pillar in Utah’s financial industry. It also means we can continue providing deposit services, lending, mortgage products and business solutions to our customers in new and meaningful ways. In a state that’s thriving economically, we believe providing these solutions is the key to staying competitive.
Consolidated Net Income was $7.2 million for Q3 2021 and $24.0 million year to date.
Net Interest Margin increased to 3.44 percent in Q3 2021, up from 3.25 percent in Q2 2021. This is the first increase in Net Interest Margin in six quarters. The downward trend was the result of a historically low rate environment compressing the margin. To offset the compression, the Bank grew the loan portfolio by $82.7 million from Q3 2020. This increase is truly a feather in the cap of our hardworking lenders.
Capital accounts remain strong. The Bank’s Retained Earnings increased year over year, from $196.7 million in Q3 2020 to $223.9 million in Q3 2021. In the same time frame, the Bank’s Tangible Book Value increased 11.7 percent. This means we’re safely saving money, sharing healthy dividends, and ensuring we can take advantage of future opportunities.
In other Q3 highlights, Bank of Utah expanded in St. George with the opening of a new full-service branch. It joins our award-winning home loan office there, and allows us to connect with more business and personal customers. We can also make an even bigger difference in that market. During the grand opening, we made a donation to Root For Kids, a nonprofit supporting families in need.
Also in Q3, our Personal Trust department acquired three new prominent clients, resulting in a 33.4 percent year-over-year increase in assets under management. As one of the few Utah-based banks that offers local trust services, our dedicated professionals have the financial and community expertise clients need and want in a trustee.
As we look ahead, we will continue to work to ensure customers, employees and communities have the strength and support they’ve come to expect from Bank of Utah.
Sincerely,
Douglas L. DeFries
President and CEO
