Latest news with #Chesler
Yahoo
a day ago
- Business
- Yahoo
Glacier Bancorp to acquire Texas bank in $476 million deal
Prolific acquirer Glacier Bancorp has struck a deal to enter Texas, agreeing to purchase Guaranty Bancshares in Mount Pleasant for $476 million in stock. The transaction is expected to close early in the fourth quarter, after which the 112-year-old Guaranty will retain its brand identity and operate as a division of the $27.9 billion-asset Glacier. Guaranty Chairman and CEO Ty Abston will serve as the division's CEO. This setup is typical for Glacier, based on its past acquisitions. Guaranty would be Glacier's 18th division. Glacier, which operates in Arizona, New Mexico and Oklahoma, saw the opportunity to acquire the $3.2 billion-asset Guaranty as a means to "further expand our presence in the Southwest," CEO Randy Chesler said Tuesday in a press release. The deal "will allow us to enter a complementary state with an exceptional demographic profile, strong growth prospects, and a business-friendly operating environment," Chesler said. Abston characterized the merger as "a perfect opportunity to position Guaranty Bank & Trust for the future." Glacier bought banks with regularity prior to the COVID-19 pandemic, announcing eight acquisitions between 2015 and 2019. The pandemic brought a lull, with just two deals announced between 2020 and 2024. Guaranty represents the company's second combination in 2025, and Janney Montgomery Scott analyst Timothy Coffey expects to see the more rapid expansion pace continue. "We believe GBCI's acquisition strategy is about to be supercharged with its entry in the Texas market and deeper penetration in the broader Southwest market," Coffey wrote Wednesday in a research note. The region is target-rich, with 200 banks holding assets of $500 million to $10 billion, Coffey noted, adding Glacier "has a strong currency, and the regulatory roadblocks to completing the transactions are coming down." Glacier unveiled plans to acquire the $1.3 billion-asset Bank of Idaho in Idaho Falls in January. It closed the deal on May 1. Chesler said Guaranty would be Glacier's second-largest acquisition, behind its purchase of the $3.5 billion-asset Altabancorp in Grand Fork, Utah, in 2021. Chesler said Glacier's immediate focus would be on closing and integrating its deal for Guaranty but added the company wouldn't stay on the sidelines indefinitely. "Once we're comfortable with [Guaranty], then we can think about M&A, both in the Mountain West but now really an enhanced opportunity in the Southwest," Chesler said Wednesday on a conference call with analysts. "There's some great banks in Texas that we think over the long haul can be really good partners." Glacier has been eyeing both the Texas marketplace and a link to Guaranty for years, according to Chesler, who noted that the deal with Guaranty was a negotiated transaction that followed an extended courtship. "We've been talking to Guaranty for years," Chesler said on the conference call. "We've spent time with them and they've been up to Kalispell (Montana) … I don't think we could have identified a better partner to enter Texas." Guaranty operates 33 branches in East Texas, maintaining a presence in the region's largest markets, Dallas, Houston and Austin. Its approach to banking major urban centers approximates Glacier's strategy in Denver, Phoenix and other big cities. "They serve the small businesses that support the city center," Chesler said. "Now they can continue what they've always done, backed by a $30 billion balance sheet and enhanced technology." Guaranty reported first-quarter net income totaling $8.6 million, up 28% from the same period in 2024. Glacier expects the Guaranty deal to be about 7.5% accretive to earnings in 2026 and 2027. Chesler said he expects the deal will be well-received by regulators. "It's a well-run bank," he said. "I really don't expect any issues with this." Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
GBCI Q1 Deep Dive: Margin Expansion and M&A Amid Loan Growth Challenges
Regional banking company Glacier Bancorp (NYSE:GBCI) fell short of the market's revenue expectations in Q1 CY2025, but sales rose 11.1% year on year to $222.6 million. Its non-GAAP profit of $0.48 per share was 4.4% above analysts' consensus estimates. Is now the time to buy GBCI? Find out in our full research report (it's free). Revenue: $222.6 million vs analyst estimates of $225 million (11.1% year-on-year growth, 1.1% miss) Adjusted EPS: $0.48 vs analyst estimates of $0.46 (4.4% beat) Market Capitalization: $4.59 billion Glacier Bancorp's first quarter results were met with a negative market reaction, as revenue missed Wall Street expectations despite double-digit year-over-year growth. Management credited the quarter's results to continued net interest margin expansion, driven by lower deposit costs and higher loan yields, as well as disciplined expense management. CEO Randy Chesler noted the bank's 'solid expense control' and 'excellent' credit performance, but acknowledged that loan balances declined due to accelerated payoffs. Chesler stated, 'We do not expect this trend to continue and still feel good about our loan growth outlook for the year.' Looking ahead, Glacier Bancorp's strategy focuses on sustaining margin improvement, integrating recent acquisitions, and navigating an uncertain economic environment. Management expects structural drivers—such as loan repricing, maturing low-yield investments, and the payoff of high-cost borrowings—to fuel further margin expansion regardless of Federal Reserve action. CFO Ron Copher emphasized a cautious stance on spending given market volatility, while Chief Credit Administrator Tom Dolan highlighted a 'through-the-cycle lens' in underwriting. Chesler added, 'We remain optimistic about the future but want to be prepared if conditions change.' Management attributed first quarter performance to higher loan yields, disciplined expense control, and continued credit quality, while also highlighting the impact of recent and pending acquisitions on future results. Margin expansion continues: The net interest margin rose for the fifth consecutive quarter, surpassing 3% for the first time in two years. Management cited factors like lower deposit costs and higher loan yields, with Chief Investment Officer Byron Pollan stating these improvements are not dependent on Federal Reserve policy changes. Loan balances declined: Despite stronger loan production late in the quarter, total loans decreased due to accelerated payoffs from commercial real estate and multifamily projects achieving stabilization or being sold. Management views the decline as temporary and expects loan growth to resume as headwinds abate and seasonality improves. Credit quality remains strong: Credit performance remained near record levels, with only a single nonaccrual event linked to a management issue rather than broader economic stress. The allowance for credit losses was increased modestly as a precaution, but no material credit deterioration is expected. Expense discipline maintained: Noninterest expense was flat year over year, aided by slower hiring and lower third-party consulting costs. Copher reiterated guidance for stable core expenses excluding merger costs, reflecting a cautious approach amid economic uncertainty. Acquisition activity progresses: The pending Bank of Idaho acquisition is expected to close soon, with management highlighting its strategic fit for expanding Glacier Bancorp's presence in high-growth markets. The deal is anticipated to provide a modest boost to net interest margin and contribute to stable balance sheet growth. Glacier Bancorp's outlook is shaped by expectations for ongoing margin improvement, integration of new acquisitions, and cautious expense management in response to economic uncertainty. Margin drivers remain intact: Management anticipates continued net interest margin expansion through 2025, driven by repricing of existing loans, maturing low-yield investment securities, and repayment of high-cost borrowings. The acquisition of Bank of Idaho is also expected to provide incremental margin lift. Loan growth rebound expected: Although loan balances declined in the first quarter, management is confident that production will improve with stronger pipelines in construction and agriculture lending. Seasonal factors and abating headwinds are expected to support low- to mid-single-digit loan growth for the year. Expense and credit vigilance: The company plans to maintain disciplined expense management, with core noninterest expense guidance excluding merger costs. While credit quality is currently strong, management increased the loan loss reserve as a precaution against potential economic challenges, indicating ongoing vigilance. In the coming quarters, the StockStory team will be watching (1) the pace and success of integrating Bank of Idaho, (2) signs of a sustained rebound in loan growth, particularly in construction and agriculture segments, and (3) evidence that margin expansion can be maintained as high-cost borrowings are repaid. The ability to preserve strong credit quality and control expenses amid ongoing economic uncertainty will also be key performance indicators. Glacier Bancorp currently trades at $41.12, down from $42.50 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
Business Insider
07-05-2025
- Business
- Business Insider
AT&T's switch from ChatGPT to open-source AI helped it hang on to thousands of customers
AT&T gets 40 million customer service calls annually. Some callers want to add phone lines, register new addresses, or reschedule appointments, but many have problems to report. Those calls contain valuable information, but extracting it isn't easy. A person listening to each of them would get a good idea of what new issues are arising and could catch small problems before they grow into big ones. But with thousands of calls coming in each day, that would be an arduous, virtually impossible task. Transcription has been automated for a while, so AT&T used to do the sorting by hand. But employees had to read millions of summaries and put each call into one of 80 categories to be analyzed for any follow-up actions that could be taken. The ultimate goal is to prevent what consumer-oriented companies call "churn." Essentially, they want to keep the customers from leaving. Hien Lam, a senior data scientist at AT&T, explained the process during a presentation at Nvidia's GTC Conference in March. Now, with large language models, AI can ingest the summaries and categorize the calls. The ChatGPT way It was pretty simple. AT&T used ChatGPT to read and sort the summaries. It did a good enough job, but Lam's team saw problems coming down the road. "While the GPT-4 model did produce very high-quality outputs, and we were able to save 50,000 customers annually, it was very expensive," Lam said. Plus, customers of ChatGPT sometimes have to wait for the powerful and expensive chips to run AI systems, called graphics processing units, to become available. Sorting the calls was a daily task. "If it takes you longer than you can run overnight, then it's not a reasonable workflow," said Ryan Chesler, a principal data scientist at the open-source AI platform who worked with Lam on the project. So they set out to create a more flexible system that AT&T could have more control over, but that also cost less. The open-source way Lam teamed up with Chesler, working under the theory that if they could stitch together several open-source AI models with different "skills," they could achieve similar results with dramatically lower cost while keeping the company's data private. First, they distilled GPT-4 into three smaller, open-source models. The most basic model was smart enough to sort roughly a quarter of the categories. A call that mentioned a competitor's name, for example, was easy for a model to identify. A call with a nuanced story about a store team member required a more sophisticated model. About half the calls could be handled by an open-source model called Danube, a small but powerful model created by Lam worked with Chesler to fine-tune it to AT&T's needs. The most complex calls went to Meta's Llama 70B model, which is larger and more costly to run. Open-source models are inherently cheaper, but they're not free to run since they still require computing power. But by only using the larger models when necessary, the team kept costs down. In fact, the open-source patchwork solution cost 35% of what AT&T was paying to use ChatGPT, with 91% relative accuracy, Lam said. It was also faster. "Using GPT-4, it took 15 hours to process one day's worth of summaries. In our new solution, it took a little under five hours," Lam said. Next, they're looking to speed things up even more. "Because it takes 4½ hours for a full day, we are looking to do it real time after you hang up with AT&T," Lam said. "We could get those outputs immediately."
