Here's what C1 Bank, CenterState will say about Q1 earnings - and about the Tampa Bay business community
By Margie Manning
Tampa Bay Business Journal
Published: Apr 9, 2015

Strong loan pipelines are likely to be highlights of two local banks' first quarter 2015 earnings reports.

C1 Financial Inc. and CenterState Banks Inc. are among the community banks that Raymond James & Associates will be watching when financial reports start coming out next week. Bank lending is a positive sign for the business community, because it means corporate customers are borrowing money to hire more workers, expand their real estate holdings or buy equipment to boost production.

Overall, Q1 2015 results are expected to feature decent loan growth, relatively benign credit trends and better mortgage-related income in what is typically a seasonally slow quarter, Raymond James analysts wrote in a bank earnings preview. However, they add that the operating environment remains challenging in light of continued pressure from slim interest margins, market-related revenue headwinds and higher expenses from reinvestment in the franchise, regulatory and technology costs.

In general smaller banks will perform better than their larger, regional peers, FBR & Co. said in a separate analysis. Commercial and industrial lending, or all-purpose business loans, continue to grow faster than commercial real estate loans, FBR said.

Raymond James analysts agree with other analysts in expecting C1 (NYSE: BNK) to report 22-cents earnings per share for the three months ended March 31. They are also in line with consensus estimates of 17-cents earnings per share for CenterState (NASDAQ: CSFL).

C1, the St. Petersburg-based parent company of C1 Bank, has a "robust pipeline” of construction loans, which are expected to fund relatively quickly, and has strength in its SBA business, Raymond James said. Expansion beyond the Tampa Bay area also is on the table: "Management is excited about the Orlando market and its [loan production office] there, while Miami continues to grow nicely,” the report said. Low oil prices are good for the company's core markets and for Florida in general, according to the report.

Raymond James is more optimistic than other analysts on loan growth at CenterState, headquartered in Davenport and parent company of CenterState Bank of Florida. A strong loan pipeline should enable solid growth, the report said.

The two banks struck a deal during the quarter, in which CenterState will sell C1's Smart Loan Express technology to financial institutions throughout the United States. The technology - a risk-adjusted, return-on-equity calculator that lets client managers price loans in real time through an app on a mobile device - also is likely to prompt discussion about the outlook for C1 Labs, the division within the bank that's focused on developing propriety tools.

CenterState is expected to report earnings on or around April 27, while C1 is expected to report on or around April 28, Raymond James said.

Margie Manning is Print Editor of the Tampa Bay Business Journal. She also covers the Money beat.