EQB Posts Strong Q1 Despite Housing Slowdown; Raises Dividend 20% on Revenue Growth and Brand Momentum
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EQB reported a 12% increase in quarterly earnings per share and a 20% hike in dividend payments compared to the previous year, despite a slower housing market.
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The "Second Chance" ad campaign with celebrity spokespeople has dramatically enhanced EQB's brand recognition and led to significant increases in website traffic, new account sign-ups, and search activity.
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EQ Bank plans to enter the small business market later this spring with a no-fee, digital banking product offering high interest on deposits. This presents a major growth opportunity.
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While provisions for credit losses were elevated in Q1, driven by the equipment financing business, EQB expects impaired loans and provisions to moderate in the second half of 2024.
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EQB remains confident in achieving its full year 2024 guidance, including 15%+ ROE, though this hinges on provisions for credit losses declining as expected. Key drivers are increased securitization revenue, strong capital ratios, margin expansion, and business momentum.