Finding Balance. Focusing on Customers.
Have you ever used an old-fashioned balance scale to weigh something, the kind with two pans and a beam in the middle? You place an item in one pan and weights in the other until the beam is completely horizontal. Lately, I’ve been thinking about “balance” in terms of the U.S. economy, contemplating the weight of the many forces that influence it. Jobs are growing, inflation is rising, global markets are slowing, interest rates are climbing and home sales are losing speed. The scale isn’t balanced, affecting most everyone.
As a longstanding financial institution, Bank of Utah has experienced this type of economic imbalance in the past. We know the signs, we prepare, and we work to protect our customers, employees and shareholders during downturns. One of Bank of Utah’s greatest strengths is its diversified product offerings. When economic conditions negatively impact one area, it is often offset by growth in other areas. The dramatic and rapid increase in rates did affect the volume of mortgage refinances and some home purchases. However, the loss in revenue was more than offset by an increase in net interest income as well as strong increases in corporate and personal trust revenue.
The Bank’s primary source of growth for the second quarter came from an increase in commercial and municipal lending. The Bank also increased its deposits for Q2 2022, without increasing costs. In addition, the Bank was careful to keep noninterest expenses in line with Q1. Not only did we find balance through our robust product offerings and our ability to provide financial expertise, we improved over last year’s Q1 results and are decidedly better than our budgeted projections. Perhaps the scales, for now, still continue to tip in Bank of Utah’s favor.
Consolidated net income for the second quarter of 2022 was $7.4 million, compared to $7.9 million for the first quarter of 2022 and $7.3 million for the second quarter of 2021, a decrease of 6.4 percent and an increase of 2.1 percent, respectively.
Noninterest income was $5.8 million, a 21.2 percent quarter-over-quarter decrease and a 22.9 percent year-over-year decrease.
Net interest income was $18.4 million, a 7.6 percent increase from Q1 2022 and a 17.4 percent increase from Q2 2021.
For 70 years, customers have trusted Bank of Utah to help them achieve their financial goals, through good times and bad. That is a humbling honor. Our commitment to customers and to our communities is unwavering. We will continue to support them by being strong, flexible and balanced, and providing just what they need at just the right time.
Douglas L. DeFries
President and CEO