Bulletin: Columbia Banking System Inc. Is Expected To Remain Solidly Profitable Despite Strains On Net Interest Margin

NEW YORK (S&P Global Ratings) Jan. 29, 2024-- S&P Global Ratings believes that Columbia Banking System Inc.'s solid profitability, ability to build capital, and good credit metrics will persist despite ongoing strains on the bank's net interest margin. As part of its recently released financial results for fourth-quarter 2023, which were softer than we expected, Columbia reported that net interest margin (NIM) declined by 13 basis points (bps) during the quarter, to 3.78%. That contributed to a worse-than-expected 5.7% sequential decline in net interest income. Furthermore, the bank expects additional near-term pressure on NIM; its guidance is that full-year 2024 NIM will be 3.50%-3.60%. The strain on NIM, as well as the bank's elevated expenses in fourth-quarter 2023, is generally

...January 29, 2024 NEW YORK (S&P Global Ratings) Jan. 29, 2024-- S&P Global Ratings believes that Columbia Banking System Inc.'s solid profitability, ability to build capital, and good credit metrics will persist despite ongoing strains on the bank's net interest margin. As part of its recently released financial results for fourth-quarter 2023, which were softer than we expected, Columbia reported that net interest margin (NIM) declined by 13 basis points (bps) during the quarter, to 3.78%. That contributed to a worse-than-expected 5.7% sequential decline in net interest income. Furthermore, the bank expects additional near-term pressure on NIM; its guidance is that full-year 2024 NIM will be 3.50%-3.60%. The strain on NIM, as well as the bank's elevated expenses in fourth-quarter 2023, is generally consistent with our view that tougher operating conditions for regional banks could lead to margin and earnings pressures, and the bank's overall financial performance remains consistent with...

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