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What changed in Amerant Bancorp Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Amerant Bancorp Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+730 added−750 removedSource: 10-K (2025-03-05) vs 10-K (2024-03-07)

Top changes in Amerant Bancorp Inc.'s 2024 10-K

730 paragraphs added · 750 removed · 553 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

143 edited+72 added−38 removed175 unchanged
Biggest changeIn the social front, some of those activities included: i) hosting our various Internship Programs in partnership with local colleges and universities in South Florida, which serve as a diverse source of talent; ii) launching Amerant’s Down-payment Assistance Program (“ADAP”) for first-time home buyers through our subsidiary Amerant Mortgage; (iii) performing team member engagement survey and internal fair pay gap assessment based on gender; and (iv) launching “Top Women Performers" Program and mandatory online education course on unconscious bias for all team members.
Biggest changeOn the social front, some of those activities included: i) hosting our various Internship Programs in partnership with local colleges and universities in South Florida, which serve as a source of talent; performing team member engagement surveys and internal fair pay gap assessment based on gender; ii) hosting a “Top Women Performers" Program and mandatory online education course on unconscious bias for all team members and inclusive leadership for all people leaders; iii) Additionally, we supported the Ingold Foundation by offering a full-day Financial Literacy program to children in the foster care system, including topics such as the basics of checking, savings and budgeting, credit, identity theft, creating your brand, and navigating your career path; iv) Lastly, as we continue to support our communities, Amerant Bank donated $100,000 on Give Miami Day to organizations, including The Zoo Miami Foundation, Dream in Green, The Everglades Foundation, and Le Jardin Community Center, Inc.
On August 3, 2023, the Company provided written notice to NASDAQ of its determination to voluntarily withdraw the principal listing of the Company’s Class A common stock, $0.10 par value per share (the “Class A common stock”), from NASDAQ and transfer the listing of the Common Stock to the New York Stock Exchange (“NYSE”).
On August 3, 2023, the Company provided written notice to NASDAQ of its determination to voluntarily withdraw the principal listing of the Company’s Class A common stock, $0.10 par value per share (the “Class A common stock”), from NASDAQ and transfer the listing of the Class A Common Stock to the New York Stock Exchange (“NYSE”).
As an approved Fannie Mae seller and servicer, Amerant Mortgage must meet certain net worth covenants outlined in Maintaining Seller/Servicer Eligibility section of the Fannie Mae Selling Guide, the “Selling Guide”.
As an approved Fannie Mae seller and servicer, Amerant Mortgage must meet certain net worth covenants outlined in the Maintaining Seller/Servicer Eligibility section of the Fannie Mae Selling Guide (the “Selling Guide”).
The CRE Guidance provides the following criteria regulatory agencies will use as indicators to identify institutions that may be exposed to CRE concentration risk: (i) experienced rapid growth in CRE lending; (ii) notable exposure to a specific type of CRE; (iii) Total reported loans for construction, land development, and other land of 100% or more of a bank’s total risk-based capital; or (iv) Total commercial real estate, which includes loans secured by multifamily and nonfarm nonresidential properties and loans for construction, land development, and other land are 300% or more of a bank’s total risk-based capital and the outstanding balance of the institutions CRE portfolio has increased by 50% or more during the prior 36 months.
The CRE Guidance provides the following criteria regulatory agencies will use as indicators to identify institutions that may be exposed to CRE concentration risk: (i) experienced rapid growth in CRE lending; (ii) notable exposure to a specific type of CRE; (iii) Total reported loans for construction, land development, and other land of 100% or more of a bank’s total risk-based capital; or (iv) Total commercial real estate, which includes loans secured by multifamily and nonfarm nonresidential properties and loans for construction, land development, and other land are 300% or more of a bank’s total risk-based capital and the outstanding balance of the institutions’ CRE portfolio has increased by 50% or more during the prior 36 months.
Our Strategic Initiatives include: • Further Strengthen the Foundation to extract maximum value from our modern technology ecosystem and continuously strengthen our operational and technology infrastructure to keep pace with competitors and enable scalability and organizational agility. • Our Relationship-first Focus centered on acquiring client relationships with high long-term value potential by creating a culture of sales excellence and analytically empowering our people to deliver personalized experiences, tailored holistic solutions, and earn the role of trusted advisor. • Drive Superior Experience and Operational Excellence through enhanced client onboarding, origination, and servicing to deliver streamlined, simple, and satisfying client experiences, reduce expenses, and fortify operational efficiency. • Attract, Retain, & Reward the Right People : Our people are the cornerstone of our success and have propelled the Bank forward amid numerous challenges.
Our strategic pillars include: • Further Strengthen the Foundation to extract maximum value from our modern technology ecosystem and continuously strengthen our operational and technology infrastructure to keep pace with competitors and enable scalability and organizational agility. • Our Relationship-first Focus centered on acquiring client relationships with high long-term value potential by creating a culture of sales excellence and analytically empowering our people to deliver personalized experiences, tailored holistic solutions, and earn the role of trusted advisor. • Drive Superior Experience and Operational Excellence through enhanced client onboarding, origination, and servicing to deliver streamlined, simple, and satisfying client experiences, reduce expenses, and fortify operational efficiency. • Attract, Retain, and Reward the Right People : Our people are the cornerstone of our success and have propelled the Bank forward amid numerous challenges.
On August 10, 2018, we completed our spin-off from the Former Parent, or the Spin-off. Our shares of Class A common stock and Class B common stock, began trading on the Nasdaq Global Select Market on August 13, 2018. On December 21, 2018, we completed an initial public offering, the IPO, of 6,300,000 shares of Class A common stock.
On August 10, 2018, we completed our spin-off from the Former Parent, or the Spin-off. Our shares of Class A common stock and Class B common stock began trading on the Nasdaq Global Select Market (“NASDAQ”) on August 13, 2018. On December 21, 2018, we completed an initial public offering, the IPO, of 6,300,000 shares of Class A common stock.
The CRE concentration limits include sub-limits by type of property and geographic market, which are reviewed semi-annually. Country limits for loans to foreign borrowers are also assessed annually. In general, all concentration levels are monitored on a monthly basis. Loan Approval Process .
The CRE concentration limits include sub-limits by property type and geographic market, which are reviewed semi-annually. Country limits for loans to foreign borrowers are also assessed annually. In general, all concentration levels are monitored on a monthly basis. Loan Approval Process .
The capital conservation buffer is calculated as the lowest of: (i) the banking organization’s CET1 capital ratio minus 4.5%; (ii) the banking organization’s Tier 1 risk-based capital ratio minus 6.0%; or (iii) the banking organization’s total risk-based capital ratio minus 8.0%. 24 Table of Contents The capital elements and total capital under the Basel III Capital Rules are as follows: Minimum CET1 4.50% Capital Conservation Buffer 2.50% Total CET1 7.00% Deductions from CET1 100.00% Minimum Tier 1 Capital 6.00% Minimum Tier 1 Capital plus conservation buffer 8.50% Minimum Total Capital 8.00% Minimum Total Capital plus conservation buffer 10.50% The Federal Reserve, the OCC, and the FDIC, published a final rule on July 22, 2019 (“the Capital Simplifications Final Rule”) that simplifies existing regulatory capital rules for non-advanced approaches institutions, such as the Company.
The capital conservation buffer is calculated as the lowest of: (i) the banking organization’s CET1 capital ratio minus 4.5%; (ii) the banking organization’s Tier 1 risk-based capital ratio minus 6.0%; or (iii) the banking organization’s total risk-based capital ratio minus 8.0%. 29 Table of Contents The capital elements and total capital under the Basel III Capital Rules are as follows: Minimum CET1 4.50% Capital Conservation Buffer 2.50% Total CET1 7.00% Deductions from CET1 100.00% Minimum Tier 1 Capital 6.00% Minimum Tier 1 Capital plus conservation buffer 8.50% Minimum Total Capital 8.00% Minimum Total Capital plus conservation buffer 10.50% The Federal Reserve, the OCC, and the FDIC, published a final rule on July 22, 2019 (“the Capital Simplifications Final Rule”) that simplifies existing regulatory capital rules for non-advanced approaches institutions, such as the Company.
Under Florida law, the Company may only pay dividends if, after giving effect to each dividend, the Company would be able to pay its debts as they become due and the Company’s total assets would exceed the sum of its total liabilities plus the amount that would be needed, if the Company were to be dissolved at the time of each dividend, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those entitled to receive the dividend. 23 Table of Contents Capital Requirements We and the Bank are required under federal law to maintain certain minimum capital levels based on ratios of capital to assets and capital to risk-weighted assets.
Under Florida law, the Company may only pay dividends if, after giving effect to each dividend, the Company would be able to pay its debts as they become due and the Company’s total assets would exceed the sum of its total liabilities plus the amount that would be needed, if the Company were to be dissolved at the time of each dividend, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those entitled to receive the dividend. 28 Table of Contents Capital Requirements We and the Bank are required under federal law to maintain certain minimum capital levels based on ratios of capital to assets and capital to risk-weighted assets.
Failure to meet the minimum net worth or net worth decline tolerance outlined above, may prompt the suspension of Amerant Mortgage as an approved seller and/or servicer, which would prevent Amerant Mortgage from taking down new commitments to deliver loans to Fannie Mae and adding loans to any portfolio that Amerant Mortgage services for Fannie Mae. 27 Table of Contents Cybersecurity Regulations and Guidelines The federal banking regulators regularly issue new guidance and standards, and update existing guidance and standards, regarding cybersecurity, which are intended to enhance cyber risk management by financial institutions.
Failure to meet the minimum net worth or net worth decline tolerance outlined above, may prompt the suspension of Amerant Mortgage as an approved seller and/or servicer, which would prevent Amerant Mortgage from taking down new commitments to deliver loans to Fannie Mae and adding loans to any portfolio that Amerant Mortgage services for Fannie Mae. 32 Table of Contents Cybersecurity Regulations and Guidelines The federal banking regulators regularly issue new guidance and standards, and update existing guidance and standards, regarding cybersecurity, which are intended to enhance cyber risk management by financial institutions.
The Company completed the transition of its core data processing platform and other applications in the fourth quarter of 2023. We believe these platform and applications have essential functionalities and scalability to support our continued growth and expansion strategy.
The Company completed the transition of its core data processing platform and other applications in the fourth quarter of 2023. We believe these platforms and applications have essential functionalities and scalability to support our continued growth and expansion strategy.
Also, the terms of such extensions of credit may not involve more than the normal risk of repayment or present other unfavorable features and may not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the bank's capital. 22 Table of Contents Debit Interchange Fees Interchange fees are fees that merchants pay to card companies and card-issuing banks such as the Bank for processing electronic payment transactions on their behalf.
Also, the terms of such extensions of credit may not involve more than the normal risk of repayment or present other unfavorable features and may not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the bank's capital. 27 Table of Contents Debit Interchange Fees Interchange fees are fees that merchants pay to card companies and card-issuing banks such as the Bank for processing electronic payment transactions on their behalf.
We believe both the Information Security Program and BCP adhere to industry best practices and comply with the guidelines of the Federal Financial Institutions Examination Council, or FFIEC, and are subject to periodic testing and independent audits. 11 Table of Contents Competition The banking and financial services industry in our footprint is highly competitive, and we compete with a wide range of lenders and other financial institutions within our markets, including local, regional, national and international commercial banks and credit unions.
We believe both the Information Security Program and BCP adhere to industry best practices and comply with the guidelines of the Federal Financial Institutions Examination Council, or FFIEC, and are subject to periodic testing and independent audits. 15 Table of Contents Competition The banking and financial services industry in our footprint is highly competitive, and we compete with a wide range of lenders and other financial institutions within our markets, including local, regional, national and international commercial banks and credit unions.
Under certain circumstances, these agencies may enforce similar remedies directly against officers, directors, employees and others participating in the affairs of a bank or bank holding company, including fines, penalties and the recovery, or claw-back, of compensation. 26 Table of Contents FDIC Insurance Assessments Deposits at U.S. domiciled banks are insured by the FDIC, subject to limits and conditions of applicable laws and regulations.
Under certain circumstances, these agencies may enforce similar remedies directly against officers, directors, employees and others participating in the affairs of a bank or bank holding company, including fines, penalties and the recovery, or claw-back, of compensation. 31 Table of Contents FDIC Insurance Assessments Deposits at U.S. domiciled banks are insured by the FDIC, subject to limits and conditions of applicable laws and regulations.
Further, federal bank regulatory authorities have additional discretion to require a financial holding company to divest itself of any bank or non-bank subsidiary if the agency determines that divestiture may aid the depository institution’s financial condition. 17 Table of Contents Change in Control Federal law limits the amount of voting stock of a bank holding company or a bank that a person may acquire without the prior approval of banking regulators.
Further, federal bank regulatory authorities have additional discretion to require a financial holding company to divest itself of any bank or non-bank subsidiary if the agency determines that divestiture may aid the depository institution’s financial condition. 22 Table of Contents Change in Control Federal law limits the amount of voting stock of a bank holding company or a bank that a person may acquire without the prior approval of banking regulators.
The HIDTA designation makes it possible for local agencies to benefit from ongoing HIDTA-coordinated program initiatives that are working to reduce drug use. 21 Table of Contents There is also increased scrutiny of compliance with the sanctions programs and rules administered and enforced by the Office of Foreign Assets Control (“OFAC”) of the U.S. Department of Treasury.
The HIDTA designation makes it possible for local agencies to benefit from ongoing HIDTA-coordinated program initiatives that are working to reduce drug use. 26 Table of Contents There is also increased scrutiny of compliance with the sanctions programs and rules administered and enforced by the Office of Foreign Assets Control (“OFAC”) of the U.S. Department of Treasury.
We provide individuals and businesses with a comprehensive array of deposit, credit, investment, wealth management, retail banking, mortgage services and fiduciary services. We serve customers in our United States markets and select international customers. These services are offered through Amerant Bank, N.A., or the Bank, which is also headquartered in Coral Gables, Florida, and its subsidiaries.
We provide individuals and businesses with a comprehensive array of deposit, credit, investment, wealth management, retail banking, mortgage services and fiduciary services. We serve customers in our United States markets and select international customers. These services are offered through Amerant Bank, N.A., or the Bank, which is also headquartered in Coral Gables, FL, and its subsidiaries.
We believe that having the ability to adjust their incentive compensation based on asset quality motivates the relationship managers to focus on the origination and maintenance of high-quality credits consistent with our strategic focus on asset quality. 9 Table of Contents Deposits Our deposits serve as the primary funding source for lending, investing and other general banking purposes.
We believe that having the ability to adjust their incentive compensation based on asset quality motivates the relationship managers to focus on the origination and maintenance of high-quality credits consistent with our strategic focus on asset quality. 12 Table of Contents Deposits Our deposits serve as the primary funding source for lending, investing and other general banking purposes.
Controls and Procedures.” 18 Table of Contents Shareholder Say-On-Pay Votes Under the Dodd-Frank Act public companies are required to provide shareholders with an advisory vote on executive compensation (known as say-on-pay votes), the frequency of a say-on-pay vote, and the golden parachutes available to executives in connection with change-in-control transactions.
Controls and Procedures.” 23 Table of Contents Shareholder Say-On-Pay Votes Under the Dodd-Frank Act public companies are required to provide shareholders with an advisory vote on executive compensation (known as say-on-pay votes), the frequency of a say-on-pay vote, and the golden parachutes available to executives in connection with change-in-control transactions.
He is a seasoned banking professional with significant experience in corporate and commercial banking. In his role, Esterripa oversees multiple business sectors, including commercial banking, commercial real estate, syndication, specialty finance, and treasury management. Before joining the Company, Mr. Esterripa served as EVP, Wholesale Banking Executive at City National Bank - Florida since 2016.
He is a seasoned banking professional with significant experience in corporate and commercial banking. In his role, Esterripa oversees multiple business sectors, including commercial banking, commercial real estate, syndication, and specialty finance. Before joining the Company, Mr. Esterripa served as EVP, Wholesale Banking Executive at City National Bank - Florida since 2016.
Armando Fleitas , age 47, serves as Executive Vice-President, Chief Accounting Officer (“CAO”) since March 2023 overseeing general accounting and accounts payable; investment accounting and operations; mortgage banking finance and accounting; and financial reporting to the Federal Reserve Bank and other federal and state banking supervisory authorities, the Securities and Exchange Commission, and the Office of Comptroller of the Currency.
Armando Fleitas , age 48, serves as Executive Vice-President, Chief Accounting Officer (“CAO”) since March 2023 overseeing general accounting and accounts payable; investment accounting and operations; mortgage banking finance and accounting; and financial reporting to the Federal Reserve Bank and other federal and state banking supervisory authorities, the Securities and Exchange Commission, and the Office of Comptroller of the Currency.
This transaction had no material impact to the Company’s results of operations in 2023. In connection with the change in ownership interest, which brought the minority interest share to zero, the Company derecognized the equity attributable to noncontrolling interest of $3.8 million at December 31, 2023, with a corresponding reduction to additional paid-in capital.
This transaction had no material impact to the Company’s results of operations in 2023. In connection with the change in ownership interest, which brought the minority interest share to zero at that date, the Company derecognized the equity attributable to noncontrolling interest of $3.8 million at December 31, 2023, with a corresponding reduction to additional paid-in capital.
In 2023 we continued to capture team member sentiments at all stages of the team member’s life cycle, from onboarding to offboarding. We also launched our annual Engagement Survey. We achieved a 76% Engagement score (As per the Engagement Survey vendor’s thresholds, any score that is above 60% represents extremely high engagement).
In 2024 we continued to capture team member sentiments at all stages of the team member’s life cycle, from onboarding to offboarding. We also launched our annual engagement survey. We achieved a 76% engagement score (As per the engagement survey vendor’s thresholds, any score that is above 60% represents extremely high engagement).
The Basel III Capital Rules, which we discuss below, further limit our permissible dividends, stock repurchases and discretionary bonuses, including those of the Bank, unless we and the Bank continue to meet the fully phased-in capital conservation buffer requirement. The Company and the Bank exceeded the capital conservation requirement at year end 2023. See “Capital Requirements”.
The Basel III Capital Rules, which we discuss below, further limit our permissible dividends, stock repurchases and discretionary bonuses, including those of the Bank, unless we and the Bank continue to meet the fully phased-in capital conservation buffer requirement. The Company and the Bank exceeded the capital conservation requirement at year end 2024. See “Capital Requirements”.
As a result, both the Company and the Bank are currently classified as "well-capitalized" for purposes of the OCC's prompt corrective action regulations. 25 Table of Contents Prompt Corrective Action Rules The federal banking agencies are required to take "prompt corrective action" with respect to financial institutions that do not meet minimum capital requirements.
As a result, both the Company and the Bank are currently classified as "well-capitalized" for purposes of the OCC's prompt corrective action regulations. 30 Table of Contents Prompt Corrective Action Rules The federal banking agencies are required to take "prompt corrective action" with respect to financial institutions that do not meet minimum capital requirements.
A change in statutes, regulations or regulatory policies applicable to us or any of our affiliates could have a material, adverse effect on our business, financial condition and results of operations. 28 Table of Contents Available Information We maintain a website at the address www.amerantbank.com.
A change in statutes, regulations or regulatory policies applicable to us or any of our affiliates could have a material, adverse effect on our business, financial condition and results of operations. 33 Table of Contents Available Information We maintain a website at the address www.amerantbank.com.
As of December 31, 2023, the Bank had a legal lending limit of approximately $144.7 million for unsecured loans, and its “in-house” single obligor lending limit was $35.0 million for CRE loans, representing 24.2% of our legal lending limit and $30.0 million for all other loans, representing 20.7% of our legal lending limit as of such date.
As of December 31, 2024, the Bank had a legal lending limit of approximately $144.7 million for unsecured loans, and its “in-house” single obligor lending limit was $35.0 million for CRE loans, representing 24.2% of our legal lending limit and $30.0 million for all other loans, representing 20.7% of our legal lending limit as of such date.
Life, AD&D and Disability: Group Basic Life and AD&D Insurance is offered to all full-time and part-time team members, at two times their annual salary with a maximum coverage of $300,000. Team members may choose to purchase additional life insurance up to 5 times their annual salary to a max of $750,000.
Life, AD&D and Disability: Group Basic Life and AD&D Insurance is offered to all full-time and part-time team members, at two times their annual salary with a maximum coverage of $500,000. Team members may choose to purchase additional life insurance up to 5 times their annual salary to a max of $750,000.
These reserve requirements are subject to annual adjustment by the Federal Reserve. 19 Table of Contents Privacy and Data Security A variety of federal and state privacy laws govern the collection, safeguarding, sharing and use of customer information, and require that financial institutions have policies regarding information privacy and security.
These reserve requirements are subject to annual adjustment by the Federal Reserve. 24 Table of Contents Privacy and Data Security A variety of federal and state privacy laws govern the collection, safeguarding, sharing and use of customer information, and require that financial institutions have policies regarding information privacy and security.
Guided by our core values, the people at Amerant are committed to providing our customers with the right products, services and advisory services; treating everyone as we expect to be treated; being leaders in innovation, quality, efficiency, and customer satisfaction; consistently exceeding expectations; promoting a diverse and inclusive work environment; holding ourselves and each other accountable; and being the bank of choice in the markets we serve.
Guided by our precepts, the people at Amerant are committed to providing our customers with the right products, services and advisory services; treating everyone as we expect to be treated; being leaders in innovation, quality, efficiency, and customer satisfaction; consistently exceeding expectations; promoting a diverse and inclusive work environment; holding ourselves and each other accountable; and being the bank of choice in the markets we serve.
If so, the Company's compliance with the provisions of the Durbin amendment would be required no later than July 1, 2025, and we do not expect the limits to debit card interchange to materially reduce the Company's revenue.
If so, the Company's compliance with the provisions of the Durbin amendment would be required no later than July 1, 2026, and we do not expect the limits to debit card interchange to materially reduce the Company's revenue.
Sanchez, age 51, serves as Senior Executive Vice-President and Chief People Officer since June 2022 and leads the Company’s approach to people and organizational culture. Previously, Mrs. Sanchez served as the Company and the Bank’s General Counsel since 2010.
Sanchez, age 52, serves as Senior Executive Vice-President and Chief People Officer since June 2022 and leads the Company’s approach to people and organizational culture. Previously, Mrs. Sanchez served as the Company and the Bank’s General Counsel since 2010.
Investment, Advisory and Trust Services We offer a wide variety of trust and estate planning products and services catering to high net worth customers, our trust and estate planning products include simple and complex trusts, private foundations, personal investment companies and escrow accounts.
Investment, Advisory and Trust Services We offer a wide variety of trust and estate planning products and services catering to high net worth customers, our trust and estate planning products include simple and complex trusts, private foundations and personal investment companies.
From 2013 to 2017, he was SVP, Corporate & Commercial Banking Manager at BankUnited, NA. He served as Executive Vice President at Stonegate Bank from 2012 to 2013 and as Senior Vice President at Capital Bank since 2010 prior to that.
From 2013 to 2016, he was SVP, Corporate & Commercial Banking Manager at BankUnited, NA. He served as Executive Vice President at Stonegate Bank from 2012 to 2013 and as Senior Vice President at Capital Bank since 2010 prior to that.
Risks Related to our Indebtedness • We may not be able to generate sufficient cash to service all of our debt, including the Senior Notes, the Subordinated Notes and the Debentures. • We are a holding company with limited operations and depend on our subsidiaries for the funds required to make payments of principal and interest on the Senior Notes, Subordinated Notes and the Debentures. • We may incur a substantial level of debt that could materially adversely affect our ability to generate sufficient cash to fulfill our obligations under the Senior Notes, the Subordinated Notes and the Debentures. 34 Table of Contents
Risks Related to our Indebtedness • We may not be able to generate sufficient cash to service all of our debt, including the Subordinated Notes and the Debentures. • We are a holding company with limited operations and depend on our subsidiaries for the funds required to make payments of principal and interest on the Subordinated Notes and the Debentures. 39 Table of Contents • We may incur a substantial level of debt that could materially adversely affect our ability to generate sufficient cash to fulfill our obligations under the Subordinated Notes and the Debentures. 40 Table of Contents
For over 20 years, we have championed targeted development programs for underrepresented talent in partnership with the Center for Financial Training, a local chapter of the American Bankers Association. Total Rewards (compensation and benefits). We believe in a competitive, total rewards program aligned with our business objectives and the interests of our stakeholders.
For over 20 years, we have championed targeted development programs for underrepresented talent in partnership with the Center for Financial Training, a local chapter of the American Bankers Association. 18 Table of Contents Total Rewards (compensation and benefits). We believe in a competitive, total rewards program aligned with our business objectives and the interests of our stakeholders.
In addition, we offer other more complex financial products such as derivative instruments, including interest rate swap and cap contracts, to more sophisticated lending customers.
In addition, we offer other more complex financial products such as derivative instruments, including interest rate swap and cap contracts, to certain lending customers.
Risk related to Credit and Interest Rate • Our profitability is subject to interest rate risk. • Our allowance for credit losses may prove inadequate. • Our concentration of CRE loans could result in increased loan losses. • Many of our loans are to commercial borrowers, which have unique risks compared to other types of loans. • Our valuation of securities and the determination of a credit loss allowance in our investment securities portfolio are subjective and, if changed, could materially adversely affect our results of operations or financial condition. • Nonperforming and similar assets take significant time to resolve and may adversely affect our business, financial condition, results of operations, or cash flows. • We are subject to environmental liability risk associated with lending activities. • Deterioration in the real estate markets, including the secondary market for residential mortgage loans, can adversely affect us.
Risk related to Credit and Interest Rate • Our profitability is subject to interest rate risk. • Our allowance for credit losses may prove inadequate. • Our concentration of CRE loans could result in increased loan losses. • Many of our loans are to commercial borrowers, which have unique risks compared to other types of loans. • Our valuation of securities and the determination of a credit loss allowance in our investment securities portfolio are subjective and, if changed, could materially adversely affect our results of operations or financial condition. • Nonperforming and similar assets take significant time to resolve and may adversely affect our business, financial condition, results of operations, or cash flows. • We are subject to environmental liability risk associated with lending activities. • Weakness in the demand for mortgage loans or in the secondary market for residential mortgage loans can adversely affect us.
From time to time, the Company may evaluate select opportunities to invest and acquire non-controlling interests, through Amerant SPV, in companies it partners with, or may acquire non-controlling interests of fintech and specialty finance companies that the Company believes will be strategic or accretive.
From time to time, the Company has evaluated select opportunities to invest and acquire non-controlling interests, through Amerant SPV, in companies it partners with, or may acquire non-controlling interests of fintech and specialty finance companies that the Company believes will be strategic or accretive.
The Company’s Common Stock listing and trading on NASDAQ ended at market close on August 28, 2023, and trading commenced on the NYSE at market open on August 29, 2023 where it continues to trade under the stock symbol “AMTB”. Our Markets Our primary market areas are South Florida (Miami-Dade, Broward and Palm Beach counties), Tampa, FL and Houston, Texas.
The Company’s Class A Common Stock listing and trading on NASDAQ ended at market close on August 28, 2023, and trading commenced on the NYSE at market open on August 29, 2023 where it continues to trade under the stock symbol “AMTB”. Our Markets Our primary market areas are South Florida (Miami-Dade, Broward and Palm Beach counties), and Tampa, FL.
In addition to surveying, we spent time on a team member listening tour to capture team members’ thoughts on life at Amerant, including Amerant Culture, Benefits, Learning and Development opportunities, and recognition. These sentiments were shared with the senior management team, and we created an action plan to address the feedback received, which we expect to implement in 2024.
In addition to surveying, we spent time on a team member listening tour to capture team members’ thoughts on life at Amerant, including Amerant Culture, Benefits, Learning and Development opportunities, and recognition. These sentiments were shared with the senior management team, and we created an action plan to address the feedback received.
As we are approaching the $10 billion in assets threshold, in the fourth quarter of 2023 we engaged a consulting firm to perform an assessment of our compliance management system and our risk management program to gauge our preparedness to meet the additional regulatory requirements and CFBP supervision that would be applicable to us after surpassing the threshold.
As we began approaching the $10 billion in assets threshold, in the fourth quarter of 2023 we engaged a consulting firm to perform an assessment of our compliance management system and our risk management program to gauge our preparedness to meet the additional regulatory requirements and CFPB supervision that would be applicable to us after surpassing the threshold.
The assessments of the Company's internal control over financial reporting as of December 31, 2023 are included in this report under “Item 9A.
The assessments of the Company's internal control over financial reporting as of December 31, 2024 are included in this report under “Item 9A.
Risks Related to Regulatory and Legal Matters • We are subject to extensive regulation that could limit or restrict our activities and adversely affect our earnings. • Changes in federal, state or local tax laws, or audits from tax authorities, could negatively affect our business, financial condition, results of operations or cash flows. • Litigation and regulatory investigations are increasingly common in our businesses and may result in significant financial losses and/or harm to our reputation. • We are subject to capital adequacy and liquidity standards, and if we fail to meet these standards, whether due to losses, growth opportunities or an inability to raise additional capital or otherwise, our business, financial condition, results of operations, or cash flows would be adversely affected. • Increases in FDIC deposit insurance premiums and assessments could adversely affect our financial condition. • Federal banking agencies periodically conduct examinations of our business, including our compliance with laws and regulations, and our failure to comply with any regulatory actions, if any, could adversely impact us. • The Federal Reserve may require us to commit capital resources to support the Bank. • We may face higher risks of noncompliance with the Bank Secrecy Act and other anti-money laundering statutes and regulations than other financial institutions. • Failures to comply with the fair lending laws, CFPB regulations or the Community Reinvestment Act, or CRA, could adversely affect us.
Risks Related to Regulatory and Legal Matters • We are subject to extensive regulation that could limit or restrict our activities and adversely affect our earnings. • There is uncertainty surrounding the potential legal, regulatory and policy changes by the presidential administration in the United States that may directly affect financial institutions. • Changes in federal, state or local tax laws, or audits from tax authorities, could negatively affect our business, financial condition, results of operations or cash flows. • Litigation and regulatory investigations are increasingly common in our businesses and may result in significant financial losses and/or harm to our reputation. • We are subject to capital adequacy and liquidity standards, and if we fail to meet these standards, whether due to losses, growth opportunities or an inability to raise additional capital or otherwise, our business, financial condition, results of operations, or cash flows would be adversely affected. • Increases in FDIC deposit insurance premiums and assessments could adversely affect our financial condition. • Federal banking agencies periodically conduct examinations of our business, including our compliance with laws and regulations, and our failure to comply with any regulatory actions, if any, could adversely impact us. • The Federal Reserve may require us to commit capital resources to support the Bank. • We may face higher risks of noncompliance with the Bank Secrecy Act and other anti-money laundering statutes and regulations than other financial institutions. • Failures to comply with the fair lending laws, CFPB regulations or the Community Reinvestment Act, or CRA, could adversely affect us.
To sustain this momentum, we are committed to developing both internal and external pipelines and aligning incentives to strategic goals to acquire, retain, and reward the right people. • Profitably Grow the Bank by driving organic growth in priority markets, expanding international banking, developing a proven blueprint for new domestic market entry, and preparing the bank to cross $10 billion in total assets. 7 Table of Contents Progress on Strategic Initiatives Further strengthen the foundation.
To sustain this momentum, we are committed to developing both internal and external pipelines and aligning incentives to strategic goals to acquire, retain, and reward the right people. • Profitably Grow the Bank by driving organic growth in priority markets, expanding international banking, developing a proven blueprint for new domestic market entry, and continuing to strengthen our foundation to cross $10 billion in total assets in 2025. 9 Table of Contents Progress on Strategic Initiatives Further strengthen the foundation.
Prior to joining MSF, Mr. Capriles served as a foreign exchange trader with the Banco Central de Venezuela (Venezuelan Central Bank) from 1989 to 1991. Mr. Capriles also served as a Professor in the Economics Department at Universidad Católica Andrés Bello in Caracas, Venezuela from 1996 to 2008. 30 Table of Contents Mr.
Prior to joining MSF, Mr. Capriles served as a foreign exchange trader with the Banco Central de Venezuela (Venezuelan Central Bank) from 1989 to 1991. Mr. Capriles also served as a Professor in the Economics Department at Universidad Católica Andrés Bello in Caracas, Venezuela from 1996 to 2008. Mr.
Our goals and objectives can be realized through the successful execution of a focused set of high-value Strategic Initiatives.
Our goals and objectives can be realized through the successful execution of a focused set of high-value strategic pillars.
We seek to achieve an appropriate balance between prudent and disciplined underwriting and flexibility in our decision-making and responsiveness to our customers.
We seek to achieve an appropriate balance between prudent and disciplined underwriting and in our decision-making and timely responsiveness to our customers.
Capriles graduated with a degree in Economics from Universidad Católica Andrés Bello in Caracas, Venezuela and earned a master’s degree in International Development Economics from Yale University, and a MBA from the Massachusetts Institute of Technology. Juan Esterripa. Mr. Esterripa, age 50, serves as Senior Executive Vice-President and Head of Commercial Banking since April 2023.
Capriles graduated with a degree in Economics from Universidad Católica Andrés Bello in Caracas, Venezuela and earned a master’s degree in International Development Economics from Yale University, and a MBA from the Massachusetts Institute of Technology. Juan Esterripa. Mr. Esterripa, age 51, serves as Senior Executive Vice-President and Chief Commercial Banking Officer since April 2023.
Our deposits are fully-insured by the Federal Deposit Insurance Corporation (“FDIC”), subject to applicable limits. See “-Supervision and Regulation.” As of December 31, 2023 and 2022, core deposits were $5.6 billion, and $5.3 billion, 70.9% and 75.5% of our total deposits at those dates, respectively. Our core deposits consist of total deposits excluding all time deposits.
Our deposits are fully-insured by the Federal Deposit Insurance Corporation (“FDIC”), subject to applicable limits. See “-Supervision and Regulation.” As of December 31, 2024 and 2023, core deposits were $5.6 billion, and $5.6 billion, 71.6% and 70.9% of our total deposits at those dates, respectively. Our core deposits consist of total deposits excluding all time deposits.
Upon crossing the $10 billion asset threshold in a calendar year, the rules require compliance with these limits by no later than July 1 of the following year. The Bank did not exceed the $10 billion asset threshold in 2023, but may exceed this threshold in 2024.
Upon crossing the $10 billion asset threshold in a calendar year, the rules require compliance with these limits by no later than July 1 of the following year. The Bank did not exceed the $10 billion asset threshold at the end of 2024, but may exceed this threshold in 2025.
As we seek to innovate, address customer needs and compete in a fast changing and competitive environment, our Company is looking to partner with fintech and specialty finance companies that are developing cutting edge solutions and products and have the potential to improve our products and services to help our clients achieve their goals in a fast changing world.
As we seek to innovate, address customer needs and compete in a fast changing and competitive environment, we evaluate opportunities to partner with fintech and specialty finance companies that are developing cutting edge solutions and products and have the potential to improve our products and services to help our clients achieve their goals in a fast changing world.
Risks Related to Our Business and Operations • Many of our major systems depend on and are operated by third-party vendors, and any systems failures or interruptions could adversely affect our operations and the services we provide to our customers. • Our information systems are exposed to cybersecurity threats and may experience interruptions and security breaches that could adversely affect our business and reputation. • Our strategic plan and growth strategy may not be achieved as quickly or as fully as we seek. • Defaults by or deteriorating asset quality of other financial institutions could adversely affect us. • New lines of business, new products and services, or strategic project initiatives may subject us to additional risks. • We face significant operational risks. • We may not have the ability or resources to keep pace with rapid technological changes in the financial services industry or implement new technology effectively. • Conditions in Venezuela could adversely affect our operations. • Our ability to achieve our environmental, social and governance goals are subject to risks, many of which are outside of our control, and our reputation could be harmed if we fail to meet such goals. • We may be unable to attract and retain key people to support our business. • Severe weather, natural disasters, global pandemics, acts of war or terrorism, theft, civil unrest, government expropriation or other external events could have significant effects on our business. • Any failure to protect the confidentiality of customer information could adversely affect our reputation and subject us to financial sanctions and other costs that could adversely affect our business, financial condition, results of operations, or cash flows. • We could be required to write down our goodwill or other intangible assets. • We have a net deferred tax asset that may or may not be fully realized. • We may incur losses due to minority investments in fintech and specialty finance companies. • We are subject to risks associated with sub-leasing portions of our corporate headquarters building. 33 Table of Contents • Our success depends on our ability to compete effectively in highly competitive markets.
Risks Related to Our Business and Operations • Many of our major systems depend on and are operated by third-party vendors, and any systems failures or interruptions could adversely affect our operations and the services we provide to our customers. • Our information systems are exposed to cybersecurity threats and may experience interruptions and security breaches that could adversely affect our business and reputation. • Our strategic plan and growth strategy may not be achieved as quickly or as fully as we seek. • Defaults by or deteriorating asset quality of other financial institutions could adversely affect us. • New lines of business, new products and services, or strategic project initiatives may subject us to additional risks. • We are susceptible to operational risks in general and fraudulent risk in particular. • We may not have the ability or resources to keep pace with rapid technological changes in the financial services industry or implement new technology effectively. • Conditions in Venezuela could adversely affect our operations. • We are subject to environmental, social and governance, or ESG, risks, many of which are outside of our control, that could harm our reputation, our business, operations, financial condition, and/or the price of our common stock. • We may be unable to attract and retain key people to support our business. • Severe weather, natural disasters, global pandemics, acts of war or terrorism, theft, civil unrest, government expropriation or other external events could have significant effects on our business. • Any failure to protect the confidentiality of customer information could adversely affect our reputation and subject us to financial sanctions and other costs that could adversely affect our business, financial condition, results of operations, or cash flows. • We could be required to write down our goodwill or other intangible assets. • We have a net deferred tax asset that may or may not be fully realized. • We may incur losses due to minority investments in fintech and specialty finance companies. 38 Table of Contents • We are subject to risks associated with sub-leasing portions of our corporate headquarters building. • Our success depends on our ability to compete effectively in highly competitive markets.
Capriles is responsible for all enterprise risk management oversight, including credit, market, operational and information security risk, BSA/AML and consumer compliance, as well as information technology. Mr.
Capriles is responsible for all enterprise risk management oversight, including credit, market, operational and information security risk, BSA/AML and consumer compliance. Mr.
Calderón worked at Ocean Bank as SVP, Head of Payment Operations. Before that, she worked at PricewaterhouseCoopers for nine years, where she began her career as an Associate and rose to Senior Manager over the course of her tenure, gaining extensive experience in financial services, including banking, broker dealers and asset management. Mrs.
Calderón worked at Ocean Bank as SVP, Head of Payment Operations from September 2020 through early June 2021. Before that, she worked at PricewaterhouseCoopers for nine years, where she began her career as an Associate and rose to Senior Manager over the course of her tenure, gaining extensive experience in financial services, including banking, broker dealers and asset management. Mrs.
Iafigliola, age 47, was appointed Senior Executive Vice President, Chief Operating Officer (COO) in June 2023. He is responsible for Amerant’s loan and deposit operations, project management, technology services, procurement, facilities, strategy and digital. Mr. Iafigliola chairs the Board of Amerant Investments and is member of the Board of Amerant Mortgage.
Carlos Iafigliola . Mr. Iafigliola, age 48, was appointed Senior Executive Vice President, Chief Operating Officer (COO) in June 2023. He is responsible for Amerant’s loan and deposit operations, project management, technology services, procurement, facilities, treasury management, and digital projects. Mr. Iafigliola chairs the Board of Amerant Investments and is member of the Board of Amerant Mortgage.
November 17, 2021 was the last day of trading of the Company’s shares of Class B common stock on “The NASDAQ Stock Market LLC (“NASDAQ”) after which only the Company’s shares of Class A common stock traded on the NASDAQ under the symbol “AMTB”.
November 17, 2021 was the last day of trading of the Company’s shares of Class B common stock on NASDAQ after which only the Company’s shares of Class A common stock traded on the NASDAQ under the symbol “AMTB”.
We generally conduct weekly credit committee meetings to approve loans at or above $20 million (loans for customers with an aggregate exposure equal to or above $20 million are also considered by the credit committee) and review any other credit related matter.
We generally conduct weekly credit committee meetings to approve loans at or above $5 million (loans for customers with an aggregate exposure equal to or above $20 million are also considered by the credit committee) and review other relevant credit related matters.
The number of shares of Class A common stock issued under the ESPP was 56,927 in 2023 compared to 35,337 in 2022. The purpose of the ESPP is to provide eligible employees of the Company and its designated subsidiaries with the opportunity to acquire a stock ownership interest in the Company on favorable terms.
The number of shares of Class A common stock issued under the ESPP was 55,407 in 2024 compared to 56,927 in 2023. The purpose of the ESPP is to provide eligible employees of the Company and its designated subsidiaries with the opportunity to acquire a stock ownership interest in the Company on favorable terms.
The information contained on our website is not incorporated by reference in, or considered part of, this Form 10-K. 29 Table of Contents Supplementary Item, Information about our Executive Officers The Executive Officers of the Company as of March 7, 2024, are as follows: Gerald P. Plush. Mr.
The information contained on our website is not incorporated by reference in, or considered part of, this Form 10-K. 34 Table of Contents Supplementary Item, Information about our Executive Officers The Executive Officers of the Company as of March 4, 2025, are as follows: Gerald P. Plush. Mr.
In the governance front, some of those activities included: (i) increasing women and minority representation in our Board of Directors and (ii) integrating sustainability factors into our procurement and third party, strategic and reputational risk frameworks. In 2023, we continued to advance our Impact Program initiatives and completed a series of activities within the scope of the program.
On the governance front, some activities included: (i) maintaining women and minority representation on our Board of Directors and (ii) integrating sustainability factors into our procurement and third-party, strategic, and reputational risk frameworks. In 2024, we continued to advance our Impact Program initiatives and completed a series of activities within the program's scope.
Human Capital Management The Company’s key human capital management objectives are to attract, retain and develop the highest quality talent.
Human Capital Management The Company’s key human capital management objectives are to attract, retain and develop the right talent.
We maintain asset quality through an emphasis on local market knowledge, long-term customer relationships, consistent and thorough underwriting for all loans and a conservative credit culture. We also seek to maintain a broadly diversified loan portfolio across geographies, customers, products and industries.
We maintain asset quality through an emphasis on local market knowledge, long-term customer relationships, consistent and thorough underwriting for all loans and a prudent credit culture. We also seek to maintain a broadly diversified loan portfolio across geographies (within Florida or with Florida based sponsors), customers, products and industries.
We are focused on seizing opportunities in the markets we serve to increase our share of consumer, small business, and commercial core deposits while reducing our reliance on brokered funds. Our growth in 2023 was reflective of our deposits-first, organic, relationship-based approach.
We are focused on seizing opportunities in the markets we serve to increase our share of consumer, small business, and commercial core deposits while reducing our reliance on brokered funds, by implementing a sales excellence culture. Our growth in 2024 was reflective of our deposits-first, organic, relationship-based approach.
Item 1. BUSINESS Our Company We are a bank holding company headquartered in Coral Gables, Florida, with $9.7 billion in assets, $6.9 billion in loans held for investment, $7.9 billion in deposits, $736.1 million of shareholders’ equity, and $2.3 billion in assets under management and custody (“AUM”) as of December 31, 2023.
Item 1. BUSINESS Our Company We are a bank holding company headquartered in Coral Gables, FL, with $9.9 billion in assets, $7.2 billion in loans held for investment, $7.9 billion in deposits, $890.5 million of shareholders’ equity, and $2.9 billion in assets under management and custody (“AUM”) as of December 31, 2024.
We serve our market areas from our headquarters in Coral Gables, FL and through a network of 16 banking locations in South Florida, 6 banking locations in Houston, Texas and 1 in Tampa, FL. Our subsidiary, Amerant Mortgage, operates its business nationally and has direct access to federal housing agencies.
We serve our market areas from our headquarters in Coral Gables, FL and through a network of 18 banking centers throughout South Florida, and 1 located in Tampa, FL. Our subsidiary, Amerant Mortgage, operates its business nationally and has direct access to federal housing agencies.
Our workforce was 47% male and 53% female at the close of 2023, and women represented 51% of Amerant’s middle management leadership (as classified by Equal Employment Opportunity Commission Category “Middle, First Management Officials”). Over 50% of our workforce is female, and most of our workforce self-identifies as Hispanic or Latino.
Our workforce was 46% male and 54% female at the close of 2024, and women represented 46% of Amerant’s middle management leadership (as classified by Equal Employment Opportunity Commission Category “Middle, First Management Officials”). Over 50% of our workforce is female, and the majority of our workforce self-identifies as Hispanic or Latino.
From 2009 to 2010, Esterripa was SVP, Chief Lending Officer at Pacific National Bank, and from 2006 to 2009, he served as SVP, Head of Middle Market Division at Mercantil Commercebank, NA. Mr. Esterripa is a graduate of the Harvard Business School executive management program. Carlos Iafigliola . Mr.
From 2009 to 2010, Esterripa was SVP, Chief Lending Officer at Pacific National Bank, and from 2006 to 2009, he served as SVP, Head of Middle Market Division at Mercantil Commercebank, NA. Mr. Esterripa is a graduate of the Harvard Business School executive management program. He currently serves on the board of Big Brothers Big Sisters of Miami.
At December 2023, the Company had $20 million available for repurchase under this repurchase program. 5 Table of Contents Amerant Mortgage As of December 31, 2023 and 2022, the Company had an 100% and 80% ownership interest in Amerant Mortgage, respectively. In the fourth quarter of 2023, the Company increased its ownership interest in Amerant Mortgage to 100% from 80%.
At December 31, 2024, the Company had $12.4 million available for repurchase under this repurchase program. 7 Table of Contents Amerant Mortgage As of December 31, 2024 and 2023, the Company had a 100% ownership interest in Amerant Mortgage, respectively. In the fourth quarter of 2023, the Company increased its ownership interest in Amerant Mortgage to 100% from 80%.
Sanchez earned a bachelor’s degree in Psychology from the University of Miami and a Juris Doctorate from St. Thomas University. In April 2021, she also graduated from the Yale School of Management’s ExecOnline’s Fostering Inclusion and Diversity Program . Active in the community, Mrs. Sanchez serves as a Director of the Board of Voices for Children Foundation, Inc.
Sanchez earned a bachelor’s degree in Psychology from the University of Miami and a Juris Doctorate from St. Thomas University. In April 2021, she also graduated from the Yale School of Management’s ExecOnline’s Fostering Inclusion and Diversity Program . Active in the community, Mrs.
She is a licensed Certified Public Accountant (CPA) in Florida and Puerto Rico, a member of the American Institute of Certified Public Accountants (AICPA), a member of the Puerto Rico State Society of CPAs and its Florida Chapter, and the Association of Latino Professionals for America (ALPFA). Mrs. Calderón currently serves on the board of directors of the Miami Zoo.
She is a licensed Certified Public Accountant (CPA) in Florida and Puerto Rico, a member of the American Institute of Certified Public Accountants (AICPA), a member of the Puerto Rico State Society of CPAs and its Florida Chapter, and the Association of Latino Professionals for America (ALPFA). Mrs.
We also continue offering higher-education tuition cost reimbursement programs, which are aimed at helping our team members put their career goals within reach and provide them with access to a wide variety of degrees and certificates.
We also continue offering higher-education tuition cost reimbursement programs, which are aimed at helping our team members put their career goals within reach and provide them with access to a wide variety of degrees and certificates. In 2024 we established a partnership with Barry University which provides our team members an opportunity to complete degrees at a reduced cost.
Our four pillars focus on Talent, Workplace, Communication, and Community. Our diversity and inclusion goals are to build teams that reflect the communities we serve while hiring and supporting diverse talent. The ethnicity of our workforce was 76% Hispanic, 17% White, 4% Black, 2% Asian, and 5% other.
Our four pillars focus on Talent, Workplace, Communication, and Community. Our belonging goals are to build teams that reflect the communities we serve while hiring and supporting all talent. The ethnicity of our workforce was 73% Hispanic, 18% White, 3% Black, 2% Asian, and 4% other.
Calderón is responsible for Amerant’s financial management, including treasury, financial reporting and accounting, financial analysis, investor relations & sustainability, internal controls and corporate tax. She also chairs the Asset-Liability Committee. Prior to her appointment as CFO, Mrs.
Calderón is responsible for Amerant’s financial management, including treasury, financial reporting and accounting, financial planning and analysis, investor relations, strategy, internal controls over financial reporting, corporate tax and products. She also chairs the Asset-Liability Committee and is a member of the Board of Amerant Investments. Prior to her appointment as CFO, Mrs.
We generally use the following key metrics to track our progress on our relationship-first strategy: i) loan to deposits ratio, and ii) the ratio of non-interest bearing deposits to total deposits. The loan to deposit ratio at December 31, 2023 was 92.0%, compared to 98.2% at December 31, 2022.
We generally use our loan-to-deposit ratio and the ratio of non-interest bearing deposits to total deposits to track our progress on our relationship-first strategy. The loan to deposit ratio at December 31, 2024 was 92.6%, compared to 92.0% at December 31, 2023.
Amerant Investments provides its services to the Bank’s U.S. domestic and international customers. The Bank’s retail customers are offered non-FDIC insured investment products and services exclusively through Amerant Investments. Other Products and Services We offer banking products and services that we believe are attractively priced with a focus on customer convenience and accessibility.
The Bank’s retail customers are offered non-FDIC insured investment products and services exclusively through Amerant Investments. 13 Table of Contents Other Products and Services We offer banking products and services that we believe are attractively priced with a focus on customer convenience and accessibility.
Our learning and development strategy is aligned with the global Association for Talent Development and our business strategy. Understanding that everyone learns differently, we offer various learning options, including traditional classroom, virtual, any-time, mobile, and social collaboration. In 2023, we continued to empower our team members to reach their full potential by providing diverse learning programs, opportunities, and resources.
Understanding that everyone learns differently, we offer various learning options, including traditional classroom, virtual, any-time, mobile, and social collaboration. In 2024, we continued to empower our team members to reach their full potential by providing diverse learning programs, opportunities, and resources.
Additionally, we focused on Digital Sales Enablement by supporting the Digital Transformation team in relaunching our Customer Relationship Management, or CRM, tool, known internally as Harmony. We delivered approximately 23,000 learning hours and invested an average of over $1,050 per team member in all our learning programs.
Additionally, we focused on digital sales enablement by supporting the digital transformation team in driving adoption to our Customer Relationship Management, or CRM, tool, known internally as Harmony. We delivered over 30,000 learning hours and allocated a learning investment of an average of $1,213.00 per team member in all our learning programs.
We are required to file periodic reports and other information with the Federal Reserve, which examines us and our non-bank subsidiaries. 16 Table of Contents Bank holding companies that meet certain criteria may elect to become “Financial Holding Companies.” Financial Holding Companies and their subsidiaries are permitted to acquire or engage in activities such as insurance underwriting, securities underwriting, travel agency activities, broad insurance agency activities, merchant banking and other activities that the Federal Reserve determines to be financial in nature or complementary thereto.
Bank holding companies that meet certain criteria may elect to become “Financial Holding Companies.” Financial Holding Companies and their subsidiaries are permitted to acquire or engage in activities such as insurance underwriting, securities underwriting, travel agency activities, broad insurance agency activities, merchant banking and other activities that the Federal Reserve determines to be financial in nature or complementary thereto.
We and the Bank were not subject to the Volcker Rule in 2023, but may become so in the future.
Given our asset size, we and the Bank were not subject to the Volcker Rule in 2024, but may become so in the future.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur amended and restated articles of incorporation and amended and restated bylaws include certain provisions that could delay a takeover or change in control of us, including: the exclusive right of our board to fill any director vacancy; advance notice requirements for shareholder proposals and director nominations; provisions limiting the shareholders’ ability to call special meetings of shareholders or to take action by written consent; and the ability of our board to designate the terms of and issue new series of preferred stock without shareholder approval, which could be used, among other things, to institute a rights plan that would have the effect of significantly diluting the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board. 54 Table of Contents The Florida Business Corporation Act contains a control-share acquisition statute that provides that a person who acquires shares in an “issuing public corporation,” as defined in the statute, in excess of certain specified thresholds generally will not have any voting rights with respect to such shares, unless such voting rights are approved by the holders of a majority of the votes of each class of securities entitled to vote separately, excluding shares held or controlled by the acquiring person.
Biggest changeOur amended and restated articles of incorporation and amended and restated bylaws include certain provisions that could delay a takeover or change in control of us, including: the exclusive right of our board to fill any director vacancy; advance notice requirements for shareholder proposals and director nominations; provisions limiting the shareholders’ ability to call special meetings of shareholders or to take action by written consent; and the ability of our board to designate the terms of and issue new series of preferred stock without shareholder approval, which could be used, among other things, to institute a rights plan that would have the effect of significantly diluting the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board.
Neither we, nor any of our subsidiaries, are subject to any limitations under the terms of the indentures governing the terms of the Senior Notes, the Subordinated Notes and the Debentures from issuing, accepting or incurring any amount of additional debt, deposits or other liabilities, including senior indebtedness or other obligations ranking equally with the Senior Notes, the Subordinated Notes and the Debentures.
Neither we, nor any of our subsidiaries, are subject to any limitations under the terms of the indentures governing the terms of the Subordinated Notes and the Debentures from issuing, accepting or incurring any amount of additional debt, deposits or other liabilities, including senior indebtedness or other obligations ranking equally with the Subordinated Notes and the Debentures.
A substantial level of debt could have important consequences to us, holders of our Senior Notes, of our Subordinated Notes, of our Debentures and our shareholders, including making it more difficult for us to satisfy our financial obligations (including the Senior Notes, the Subordinated Notes and the Debentures); requiring us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for other purposes; increasing our vulnerability to adverse economic and industry conditions, which could place us at a disadvantage relative to our competitors that have less debt; limiting our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate; and limiting our ability to borrow additional funds, or to dispose of assets to raise funds, if needed, for working capital, capital expenditures, acquisitions and other corporate purposes.
A substantial level of debt could have important consequences to us, holders of our Subordinated Notes, of our Debentures and our shareholders, including making it more difficult for us to satisfy our financial obligations (including the Subordinated Notes and the Debentures); requiring us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for other purposes; increasing our vulnerability to adverse economic and industry conditions, which could place us at a disadvantage relative to our competitors that have less debt; limiting our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate; and limiting our ability to borrow additional funds, or to dispose of assets to raise funds, if needed, for working capital, capital expenditures, acquisitions and other corporate purposes.
In addition, our right and the rights of our creditors, including holders of the Senior Notes, the Subordinated Notes and the Debentures to participate in the assets of any non-guarantor subsidiary upon its liquidation or reorganization would be subject to the prior claims of such non-guarantor subsidiary’s creditors, except to the extent that we may ourselves be a creditor with recognized claims against such non-guarantor subsidiary.
In addition, our right and the rights of our creditors, including holders of the Subordinated Notes and the Debentures to participate in the assets of any non-guarantor subsidiary upon its liquidation or reorganization would be subject to the prior claims of such non-guarantor subsidiary’s creditors, except to the extent that we may ourselves be a creditor with recognized claims against such non-guarantor subsidiary.
We may be unable to refinance any of our debt when needed on commercially reasonable terms or at all. We are a holding company with limited operations and depend on our subsidiaries for the funds required to make payments of principal and interest on the Senior Notes, Subordinated Notes and the Debentures.
We may be unable to refinance any of our debt when needed on commercially reasonable terms or at all. We are a holding company with limited operations and depend on our subsidiaries for the funds required to make payments of principal and interest on the Subordinated Notes and the Debentures.
A decrease in residential real estate market prices or lower levels of home sales, could result in lower single family home values, adversely affecting the value of collateral securing residential mortgage loans and residential property collateral securing loans that we hold, mortgage loan originations and gains on the sale of mortgage loans.
In addition, a decrease in residential real estate market prices or lower levels of home sales, could result in lower single family home values, adversely affecting the value of collateral securing residential mortgage loans and residential property collateral securing loans that we hold, mortgage loan originations and gains on the sale of mortgage loans.
Accordingly, if the Bank fails to maintain the applicable minimum capital ratios and the capital conservation buffer, dividends to us from the Bank may be prohibited or limited, and there may be insufficient funds to make principal and interest payments on the Senior Notes, the Subordinated Notes and the Debentures.
Accordingly, if the Bank fails to maintain the applicable minimum capital ratios and the capital conservation buffer, dividends to us from the Bank may be prohibited or limited, and there may be insufficient funds to make principal and interest payments on the Subordinated Notes and the Debentures.
We are a separate and distinct legal entity from the Bank and our other subsidiaries. Our primary source of funds to make payments of principal and interest on the Senior Notes, the Subordinated Notes and the Debentures, and to satisfy any other financial obligations are dividends from the Bank.
We are a separate and distinct legal entity from the Bank and our other subsidiaries. Our primary source of funds to make payments of principal and interest on the Subordinated Notes and the Debentures, and to satisfy any other financial obligations are dividends from the Bank.
See Note 1 - Business, Basis of Presentation and Summary of Significant Accounting Policies in the notes to consolidated financial statements included in Item 15.1 Consolidated Financial Statements in this report for further information regarding accounting standards updates. 48 Table of Contents Risks Related to External and Market Factors Material and negative developments adversely impacting the financial services industry at large and causing volatility in financial markets and the economy may have materially adverse effects on our liquidity, business, financial condition and results of operations .
See Note 1 - Business, Basis of Presentation and Summary of Significant Accounting Policies in the notes to consolidated financial statements included in Item 15.1 Consolidated Financial Statements in this report for further information regarding accounting standards updates. 55 Table of Contents Risks Related to External and Market Factors Material and negative developments adversely impacting the financial services industry at large and causing volatility in financial markets and the economy may have materially adverse effects on our liquidity, business, financial condition and results of operations .
While we assess regularly the likely outcomes of these potential audits, there can be no assurance that we will accurately predict the outcome of a potential audit, and an audit could have a material adverse impact on our business, financial condition, results of operations, or cash flows. 50 Table of Contents Litigation and regulatory investigations are increasingly common in our businesses and may result in significant financial losses and/or harm to our reputation.
While we assess regularly the likely outcomes of these potential audits, there can be no assurance that we will accurately predict the outcome of a potential audit, and an audit could have a material adverse impact on our business, financial condition, results of operations, or cash flows. 58 Table of Contents Litigation and regulatory investigations are increasingly common in our businesses and may result in significant financial losses and/or harm to our reputation.
Any increases in the provision for credit losses will result in a decrease in net income and may adversely affect our business, financial condition, results of operations, or cash flows. 37 Table of Contents On December 31, 2022, we ceased to be an Emerging Growth Company, and we implemented FASB’s Accounting Standards Codification (“ASC”) Topic 326, Financial Instruments - Credit Losses, a new guidance on accounting for current expected credit losses on financial instruments (“CECL”).
Any increases in the provision for credit losses will result in a decrease in net income and may adversely affect our business, financial condition, results of operations, or cash flows. 43 Table of Contents On December 31, 2022, we ceased to be an Emerging Growth Company, and we implemented FASB’s Accounting Standards Codification (“ASC”) Topic 326, Financial Instruments - Credit Losses, a new guidance on accounting for current expected credit losses on financial instruments (“CECL”).
Any increases in our assessment rate, future special assessments, or required prepayments in FDIC insurance premiums could reduce our profitability or limit our ability to pursue certain business opportunities, which could adversely affect our business, financial condition, results of operations, or cash flows. 51 Table of Contents Federal banking agencies periodically conduct examinations of our business, including our compliance with laws and regulations, and our failure to comply with any regulatory actions, if any, could adversely impact us.
Any increases in our assessment rate, future special assessments, or required prepayments in FDIC insurance premiums could reduce our profitability or limit our ability to pursue certain business opportunities, which could adversely affect our business, financial condition, results of operations, or cash flows. 59 Table of Contents Federal banking agencies periodically conduct examinations of our business, including our compliance with laws and regulations, and our failure to comply with any regulatory actions, if any, could adversely impact us.
In addition, if the United States economy returns to a recessionary state, management believes that it could significantly affect the economic conditions of the market areas we serve and we could experience significantly higher delinquencies and loan losses, and therefore impact our earnings and financial condition, including our capital and liquidity. 38 Table of Contents Many of our loans are to commercial borrowers, which have unique risks compared to other types of loans.
In addition, if the United States economy returns to a recessionary state, management believes that it could significantly affect the economic conditions of the market areas we serve and we could experience significantly higher delinquencies and loan losses, and therefore impact our earnings and financial condition, including our capital and liquidity. 44 Table of Contents Many of our loans are to commercial borrowers, which have unique risks compared to other types of loans.
Our ability to make scheduled payments of principal and interest or to satisfy our obligations in respect of our Senior Notes, Subordinated Notes and the Debentures or to refinance them will depend on our future operating performance.
Our ability to make scheduled payments of principal and interest or to satisfy our obligations in respect of our Subordinated Notes and the Debentures or to refinance them will depend on our future operating performance.
We may incur a substantial level of debt that could materially adversely affect our ability to generate sufficient cash to fulfill our obligations under the Senior Notes, the Subordinated Notes and the Debentures.
We may incur a substantial level of debt that could materially adversely affect our ability to generate sufficient cash to fulfill our obligations under the Subordinated Notes and the Debentures.
In addition, larger competitors may be able to price loans and deposits more aggressively than we are able to and have broader and more diverse customer and geographic bases to draw upon. 47 Table of Contents Risks Related to Risk Management, Internal Audit, Internal and Disclosure Controls Potential gaps in our risk management policies and internal audit procedures may leave us exposed to unidentified or unanticipated risk, which could negatively affect our business.
In addition, larger competitors may be able to price loans and deposits more aggressively than we are able to and have broader and more diverse customer and geographic bases to draw upon. 54 Table of Contents Risks Related to Risk Management, Internal Audit, Internal and Disclosure Controls Potential gaps in our risk management policies and internal audit procedures may leave us exposed to unidentified or unanticipated risk, which could negatively affect our business.
Such cyberattacks, if they result from internal control inadequacies or non-compliance, could materially damage our reputation, lead to civil or criminal penalties, or both, which, in turn, could adversely affect our business, financial condition, results of operations, or cash flows. 45 Table of Contents We could be required to write down our goodwill and other intangible assets .
Such cyberattacks, if they result from internal control inadequacies or non-compliance, could materially damage our reputation, lead to civil or criminal penalties, or both, which, in turn, could adversely affect our business, financial condition, results of operations, or cash flows. 52 Table of Contents We could be required to write down our goodwill and other intangible assets .
As of December 31, 2023, we had outstanding an aggregate principal amount of $60.0 million of senior notes with a coupon rate of 5.75% and a maturity date of June 30, 2025 (the “Senior Notes”); an aggregate principal amount of $30.0 million of 4.25% Fixed-to-Floating Rate Subordinated Notes due March 15, 2032 (the “Subordinated Notes”); and an aggregate principal amount of $64.2 million in junior subordinated debentures (the “Debentures”).
As of December 31, 2024, we had outstanding an aggregate principal amount of $60.0 million of senior notes with a coupon rate of 5.75% and a maturity date of June 30, 2025 (the “Senior Notes”); an aggregate principal amount of $30.0 million of 4.25% Fixed-to-Floating Rate Subordinated Notes due March 15, 2032 (the “Subordinated Notes”); and an aggregate principal amount of $64.2 million in junior subordinated debentures (the “Debentures”).
If we are required to rely more heavily on more expensive and potentially less stable funding sources or if additional financing sources are unavailable or are not available on acceptable terms, our profitability, liquidity, and prospects could be adversely affected. 35 Table of Contents We may not be able to develop and maintain a strong core deposit base or other low-cost funding sources.
If we are required to rely more heavily on more expensive and potentially less stable funding sources or if additional financing sources are unavailable or are not available on acceptable terms, our profitability, liquidity, and prospects could be adversely affected. 41 Table of Contents We may not be able to develop and maintain a strong core deposit base or other low-cost funding sources.
Risks Related to our Indebtedness We may not be able to generate sufficient cash to service all of our debt, including the Senior Notes, the Subordinated Notes and the Debentures.
Risks Related to our Indebtedness We may not be able to generate sufficient cash to service all of our debt, including the Subordinated Notes and the Debentures.
These two market areas are susceptible to hurricanes, tropical storms and other similar severe weather events which could have the effects indicated above.
These market areas are susceptible to hurricanes, tropical storms and other similar severe weather events which could have the effects indicated above.
The ability to keep pace with technological change is important and the failure to do so could adversely affect our business, financial condition, results of operations, or cash flows. Conditions in Venezuela could adversely affect our operations. At December 31, 2023, 24% of our deposits, or approximately $1.9 billion, were from Venezuelan residents.
The ability to keep pace with technological change is important and the failure to do so could adversely affect our business, financial condition, results of operations, or cash flows. Conditions in Venezuela could adversely affect our operations. At December 31, 2024, 24% of our deposits, or approximately $1.9 billion, were from Venezuelan residents.
We cannot assure you we will not experience increases in nonperforming loans, OREO and similar nonperforming assets in the future. 40 Table of Contents We are subject to environmental liability risk associated with lending activities . A significant portion of our loan portfolio is secured by real property.
We cannot assure you we will not experience increases in nonperforming loans, OREO and similar nonperforming assets in the future. 46 Table of Contents We are subject to environmental liability risk associated with lending activities . A significant portion of our loan portfolio is secured by real property.
Our CRE loans included approximately $1.2 billion and $1.1 billion of fixed rate loans at December 31, 2023 and 2022, respectively. In a rising interest rate environment, fixed rate loans may adversely affect our margin and present asset/liability mismatches and risks since our liabilities are generally floating rate or have shorter maturities.
Our CRE loans included approximately $1.1 billion and $1.2 billion of fixed rate loans at December 31, 2024 and 2023, respectively. In a rising interest rate environment, fixed rate loans may adversely affect our margin and present asset/liability mismatches and risks since our liabilities are generally floating rate or have shorter maturities.
Our inability to dispose of our minority investment in an entity or a downward adjustment to or impairment of an equity investment could adversely impact our business, financial condition, results of operations, or cash flows. 46 Table of Contents We are subject to risks associated with sub-leasing portions of our corporate headquarters building .
Our inability to dispose of our minority investment in an entity or a downward adjustment to or impairment of an equity investment could adversely impact our business, financial condition, results of operations, or cash flows. 53 Table of Contents We are subject to risks associated with sub-leasing portions of our corporate headquarters building .
We may face the following particular risks: the demand for loans and our other products and services could decline, market developments may negatively affect industries we extend credit to and may result in increased delinquencies and default rates, which, among other effects, could negatively impact our charge-offs and allowance for credit losses; market disruptions could make valuation of assets more difficult and subjective and may negatively affect our ability to measure the fair value of our assets; and, loan performance could deteriorate, loan default levels and foreclosure activity increase and or our assets could materially decline in value.
We may face the following particular risks: the demand for loans and our other products and services could decline, market developments may negatively affect industries we extend credit to and may result in increased delinquencies and default rates, which, among other effects, could negatively impact our charge-offs and allowance for credit losses; market disruptions could make valuation of assets more difficult and subjective and may negatively 56 Table of Contents affect our ability to measure the fair value of our assets; and, loan performance could deteriorate, loan default levels and foreclosure activity increase and or our assets could materially decline in value.
If this were to occur, we cannot assure you we would have or be able to obtain sufficient funds to make these accelerated payments. If any of our debt is accelerated, our assets may not be sufficient to repay such debt in full. Item 1B. UNRESOLVED STAFF COMMENTS None. 56
If this were to occur, we cannot assure you we would have or be able to obtain sufficient funds to make these accelerated payments. If any of our debt is accelerated, our assets may not be sufficient to repay such debt in full. Item 1B. UNRESOLVED STAFF COMMENTS None. 64
In 2023, the Company did not record an allowance for estimated credit losses on any of its debt securities available for sale. For more information about CECL, see Note 1 of our audited consolidated financial statements in this Form-10-K.
In 2024, the Company did not record an allowance for estimated credit losses on any of its debt securities available for sale. For more information about CECL, see Note 1 of our audited consolidated financial statements in this Form-10-K.
Such regulators have the authority to require that a bank cease and desist from unsafe and unsound practices and to prevent a bank from paying a dividend if its financial condition is such that the regulator views the payment of a dividend to constitute an unsafe or unsound practice. 55 Table of Contents Accordingly, we can provide no assurance that we will receive dividends from the Bank in an amount sufficient to pay the principal of, or interest on, the Senior Notes, the Subordinated Notes and the Debentures.
Such regulators have the authority to require that a bank cease and desist from unsafe and unsound practices and to prevent a bank from paying a dividend if its financial condition is such that the regulator views the payment of a dividend to constitute an unsafe or unsound practice. 63 Table of Contents Accordingly, we can provide no assurance that we will receive dividends from the Bank in an amount sufficient to pay the principal of, or interest on, the Subordinated Notes and the Debentures.
Further, potential action by governments and regulatory bodies in response to financial crises affecting the global and U.S. banking systems and financial markets, such as nationalization, conservatorship, receivership and other intervention, or lack of action by governments and central banks, as well as deterioration in the banks’ creditworthiness, could adversely affect the value and/or liquidity of these instruments, securities, transactions and investments or limit our ability to trade with them.
Further, potential action by governments and regulatory bodies in response to financial crises affecting the global and U.S. banking systems and financial markets, such as nationalization, conservatorship, receivership and other intervention, or lack of action by governments and central banks, as well as deterioration in a financial institution’s creditworthiness, could adversely affect the value and/or liquidity of these instruments, securities, transactions and investments or limit our ability to trade with them.
Our inability to service our debt, pay our other obligations or pay dividends to our shareholders could adversely impact our financial condition and the value our securities. 36 Table of Contents Risks related to Credit and Interest Rate Our profitability is subject to interest rate risk.
Our inability to service our debt, pay our other obligations or pay dividends to our shareholders could adversely impact our financial condition and the value our securities. 42 Table of Contents Risks related to Credit and Interest Rate Our profitability is subject to interest rate risk.
In addition, the method that the FDIC uses to determine the amount of our deposit insurance premium will change once our total consolidated assets exceed $10 billion, which we expect may happen in 2024.
In addition, the method that the FDIC uses to determine the amount of our deposit insurance premium will change once our total consolidated assets exceed $10 billion, which we expect may happen in 2025.
The Florida and Houston, Texas banking markets in which we do business are highly competitive; therefore, our future growth and success will depend on our ability to compete effectively in these markets.
The Florida banking markets in which we do business are highly competitive; therefore, our future growth and success will depend on our ability to compete effectively in these markets.
Our total loan exposure to international markets, primarily individuals in Venezuela and corporations in other Latin American countries, was $87.6 million, or less than 1.5%, of our total loans, at December 31, 2023. 52 Table of Contents If our policies, procedures and systems are deemed deficient or fail to prevent violations of law or the policies, procedures and systems of the financial institutions that we may acquire in the future are deficient, we would be subject to liability (including fines); formal regulatory enforcement actions (including possible cease and desist orders, restrictions on our ability to pay dividends, regulatory limitations on implementing certain aspects of our business plan, including acquisitions or banking center relocation or expansion); and additional expenses to cure any deficiency, which could adversely affect our business, financial condition, results of operations, or cash flows.
Our total loan exposure to international markets, primarily individuals in Venezuela and corporations in other Latin American countries, was $40.7 million, or less than 1.5%, of our total loans, at December 31, 2024. 60 Table of Contents If our policies, procedures and systems are deemed deficient or fail to prevent violations of law or the policies, procedures and systems of the financial institutions that we may acquire in the future are deficient, we would be subject to liability (including fines); formal regulatory enforcement actions (including possible cease and desist orders, restrictions on our ability to pay dividends, regulatory limitations on implementing certain aspects of our business plan, including acquisitions or banking center relocation or expansion); and additional expenses to cure any deficiency, which could adversely affect our business, financial condition, results of operations, or cash flows.
Furthermore, the BHC Act and the Change in Bank Control Act impose notice, application and approvals and ongoing regulatory requirements on any shareholder or other party that seeks to acquire direct or indirect “control” of bank holding companies, such as ourselves.
Furthermore, the BHC Act and the Change in Bank Control Act 62 Table of Contents impose notice, application and approvals and ongoing regulatory requirements on any shareholder or other party that seeks to acquire direct or indirect “control” of bank holding companies, such as ourselves.
Changes in federal, state or local tax laws, or audits from tax authorities, could negatively affect our business, financial condition, results of operations or cash flows. We are subject to changes in tax law that could increase our effective tax rates.
Changes in federal, state or local tax laws, or audits from tax authorities, could negatively affect our business, financial condition, results of operations or cash flows. 57 Table of Contents We are subject to changes in tax law that could increase our effective tax rates.
There are many factors that may affect the market price and trading volume of our shares of common stock, including the factors described in this “Risk Factors” section, and other factors, most of which are outside of our control.
There are many factors that may affect 61 Table of Contents the market price and trading volume of our shares of common stock, including the factors described in this “Risk Factors” section, and other factors, most of which are outside of our control.
Further, rapidly changing and unprecedented credit and equity market conditions could materially affect the valuation of securities in our financial statements and the period-to-period changes in estimated fair value could vary significantly. 39 Table of Contents As of December 31, 2023, the fair value of the Company’s debt securities available for sale was approximately $1.2 billion, compared to $1.1 billion as of December 31, 2022.
Further, rapidly changing and unprecedented credit and equity market conditions could materially affect the valuation of securities in our financial statements and the period-to-period changes in estimated fair value could vary significantly. 45 Table of Contents As of December 31, 2024, the fair value of the Company’s debt securities available for sale was approximately $1.4 billion, compared to $1.2 billion as of December 31, 2023.
For example, in March and April 2023, bank runs precipitated the failure of four banks in the U.S. causing a state of volatility in the capital and credit markets and uncertainty regarding the health of the U.S. banking system, particularly around liquidity, uninsured deposits and customer concentrations.
For example, in March and April 2023, significant deposit withdrawals or bank runs precipitated the failure of four banks in the U.S. causing a state of volatility in the capital and credit markets and uncertainty regarding the health of the U.S. banking system, particularly around liquidity, uninsured deposits and customer concentrations.
In addition, changes in the corporate tax rates could affect the value of our DTAs and may require a write-off of a portion of some of those assets. At December 31, 2023, we had net DTAs with a book value of $55.6 million, based on a U.S. corporate income tax rate of 21%.
In addition, changes in the corporate tax rates could affect the value of our DTAs and may require a write-off of a portion of some of those assets. At December 31, 2024, we had net DTAs with a book value of $53.5 million, based on a U.S. corporate income tax rate of 21%.
Severe weather and natural disasters, (including hurricanes, tornados, earthquakes, fires, droughts and floods), acts of war or terrorism (such as Russia’s invasion of Ukraine and hostilities in Israel and surrounding areas), epidemics and global pandemics (such as the recent COVID-19 outbreak), theft, civil unrest, government expropriation, condemnation or other external events in the markets where we operate or where our customers live (including Venezuela) could have a significant effect on our ability to conduct business.
Severe weather and natural disasters, (including hurricanes, tornados, earthquakes, fires, droughts and floods), acts of war or terrorism (such as hostilities in Ukraine and the Middle-East region), epidemics and global pandemics (such as the COVID-19 outbreak), theft, civil unrest, government expropriation, condemnation or other external events in the markets where we operate or where our customers live (including Venezuela) could have a significant effect on our ability to conduct business.
Adverse economic conditions in Venezuela may continue to negatively affect our Venezuelan deposit base, as customers residing in Venezuela rely on their U.S. Dollar deposits to fund living expenses and other necessities without being able to generate additional U.S. Dollars.
All of the Bank’s deposits are denominated in U.S. Dollars. Adverse economic conditions in Venezuela may continue to negatively affect our Venezuelan deposit base, as customers residing in Venezuela rely on their U.S. Dollar deposits to fund living expenses and other necessities without being able to generate additional U.S. Dollars.
The occurrence of any such event could adversely affect our business, financial condition, results of operations, or cash flows. Our business is mainly concentrated in two markets: South Florida, and the Houston, Texas area, which may increase our risks from extreme weather.
The occurrence of any such event could adversely affect our business, financial condition, results of operations, or cash flows. Our business is mainly concentrated in South Florida and the greater Tampa, Florida area, which may increase our risks from extreme weather.
As of December 31, 2023, our executive officers, directors and each of our greater than 5% holders of our voting Class A common stock beneficially owned outstanding shares representing, in the aggregate, approximately 33% of the outstanding shares of our voting Class A common stock (without giving effect to the broad family holdings of the Capriles, Marturet and Vollmer families which will bring the percentage to an aggregate of approximately 55%).
As of December 31, 2024, our executive officers, directors and each of the 5% or greater holders of our voting Class A common stock beneficially owned outstanding shares representing, in the aggregate, approximately 36% of the outstanding shares of our voting Class A common stock (without giving effect to the broad family holdings of the Capriles, Marturet and Vollmer families which will bring the percentage to an aggregate of approximately 57%).
In 2023, the Company recorded pre-tax net unrealized holding losses of $14.9 million ($127.7 million in 2022) which are included in accumulated other comprehensive (loss) income for the period. These unrealized losses were mainly attributable to increases in market interest rates during the periods which translated into a decline in the estimated fair value of debt securities markets.
In 2024, the Company recorded pre-tax net unrealized holding losses of $42.2 million ($14.9 million in 2023) which are included in accumulated other comprehensive (loss) income for the period. These unrealized losses were mainly attributable to increases in market interest rates during the periods which translated into a decline in the estimated fair value of debt securities and other instruments.
We cannot predict the prices at which our shares of common stock will continue to trade. You should consider an investment in our common stock to be risky. The trading price may be highly volatile, which may make it difficult for you to resell your shares at the volume, prices and times desired.
You should consider an investment in our common stock to be risky. The trading price may be highly volatile, which may make it difficult for you to resell your shares at the volume, prices and times desired.
Failure to successfully manage these risks in the development and implementation of new lines of business and/or new products or services could adversely affect our business, financial condition, results of operations, or cash flows. We face significant operational risks.
Failure to successfully manage these risks in the development and implementation of new lines of business and/or new products or services could adversely affect our business, financial condition, results of operations, or cash flows. We are susceptible to operational risks in general and fraudulent risk in particular.
This volatility has particularly impacted the price of securities issued by financial institutions, including ours. While the U.S.
This volatility particularly impacted the price of securities issued by financial institutions, including ours. While during this crisis and historically, the U.S.
Additionally, the results of our strategic plan and growth strategy are subject to the other risks described herein that affect our business, which include: lending, interest rate risk, seeking deposits and wealth management clients in highly competitive domestic markets; our ability to achieve our growth plans or to manage our growth effectively; the benefits from our technology investments, including the benefits and cost savings we expect to achieve from our outsourcing relationship with FIS, may take longer than expected to be realized and may not be as large as expected, or may require additional investments; and if we are unable to reduce our cost structure, we may not be able to meet our profitability objectives. 42 Table of Contents Defaults by or deteriorating asset quality of other financial institutions could adversely affect us.
Additionally, the results of our strategic plan and growth strategy are subject to the other risks described herein that affect our business, which include: lending, interest rate 48 Table of Contents risk, seeking deposits and wealth management clients in highly competitive domestic markets; our ability to achieve our growth plans or to manage our growth effectively; the benefits from our technology investments may not be realized or may take longer than expected to be realized and may not be as large as expected, or may require additional investments; and if we are unable to achieve economies of scale or reduce our cost structure, we may not be able to meet our profitability objectives.
The risk of noncompliance with such rules can be more acute for financial institutions like us that have numerous customers from Latin America or who do business there. As of December 31, 2023, $1.9 billion, or 23.7%, of our total deposits were from residents of Venezuela.
The risk of noncompliance with such rules can be more acute for financial institutions like us that have numerous customers from Latin America or who do business there. As of December 31, 2024, $1.9 billion, or 24.1%, of our total deposits and a significant portion of our assets under management were from residents of Venezuela.
As of December 31, 2023 debt securities available-for-sale had net unrealized holding losses of $100.3 million ($113.0 million in 2022) and net unrealized holding gains of $3.2 million ($1.0 million in 2022).
As of December 31, 2024 debt securities available-for-sale had net unrealized holding losses of $55.7 million ($100.3 million in 2023) and net unrealized holding gains of $0.9 million ($3.2 million in 2023).
We had goodwill of $19.2 million and other intangible assets of $5.8 million at December 31, 2023. Our business acquisitions typically have resulted in goodwill and other intangible assets, which affect the amount of future amortization expense and potential impairment expense. We make estimates and assumptions in valuing such goodwill and intangible assets that affect our consolidated financial statements.
We had goodwill of $19.2 million and other intangible assets of $5.8 million at December 31, 2024. Our business acquisitions typically have resulted in goodwill and other intangible assets and these may result in a future impairment expense. We make estimates and assumptions in valuing such goodwill and intangible assets that affect our consolidated financial statements.
New lines of business, new products and services, or strategic project initiatives may subject us to additional risks. We periodically evaluate our service offerings and, occasionally, may seek to implement new lines of business or offer new products and services within existing lines of business.
We periodically evaluate our service offerings and, occasionally, may seek to implement new lines of business or offer new products and services within existing lines of business.
Adverse financial market and economic conditions may continue to exert downward pressure on the prices of stock and other securities and negatively impact credit availability for certain issuers, including us, without regard to their underlying financial strength. Additionally, these developments have negatively impacted customer confidence in the safety and soundness of banks.
Adverse financial market and economic conditions may continue to exert downward pressure on the prices of stock and other securities and negatively impact credit availability for certain issuers, including us, without regard to their underlying financial strength.
For example, we entered into a new multi-year outsourcing agreement with the world's largest provider of banking and payments technology, to assume full responsibility over a significant number of the Bank’s support functions and staff, including certain critical back-office operations. In November 2023 we transitioned our entire core banking system to the one this vendor offers and services.
For example, we entered into a new multi-year outsourcing agreement with the world's largest provider of banking and payments technology, to assume full responsibility over a significant number of the Bank’s support functions and staff, including certain critical back-office operations.
As of December 31, 2023, the Bank’s portfolio of CRE loans was 274.3% of its risk-based capital, or 38.4% of its total loans, as of December 31, 2023 compared to 289.1% of its risk-based capital, or 45.3% of its total loans, as of December 31, 2022.
As of December 31, 2024, the Bank’s portfolio of CRE loans was 239.4% of its risk-based capital, or 34.5% of its total loans, as of December 31, 2024 compared to 274.3% of its risk-based capital, or 38.4% of its total loans, as of December 31, 2023.
Nonperforming and similar assets take significant time to resolve and may adversely affect our business, financial condition, results of operations, or cash flows . At December 31, 2023 and 2022, our nonperforming loans totaled $34.4 million and $37.6 million, respectively, or 0.47% and 0.54% of total loans, respectively. We had no OREO balances at December 31, 2023 and 2022.
Nonperforming and similar assets take significant time to resolve and may adversely affect our business, financial condition, results of operations, or cash flows. At December 31, 2024 and 2023, our nonperforming loans totaled $104.1 million and $34.4 million, respectively, or 1.43% and 0.47% of total loans, respectively.
Because these debt instruments rank senior to our common stock, if we fail to timely make principal and interest payments on the Senior Notes, the Subordinated Notes and the Debentures, we may not pay any dividends on our common stock.
We have outstanding debt instruments that rank senior to our common stock, if we fail to timely make principal and interest payments on any of these debt instruments, we may not pay any dividends on our common stock.
As of December 31, 2023, approximately $2.3 billion, or 34%, and $1.5 billion, or 22%, of our loan portfolio was comprised of CRE loans and commercial loans, respectively.
As of December 31, 2024, approximately $2.5 billion, or 35%, and $1.8 billion, or 26%, of our loan portfolio was comprised of CRE loans and commercial loans, respectively.
Our non-performing assets may adversely affect our net income in various ways. We do not record interest income on nonaccrual loans or OREO, and these assets require higher loan administration and other costs, thereby adversely affecting our income.
We had OREO balances of $18.1 million and $20.2 million at December 31, 2024 and 2023, respectively. Our non-performing assets may adversely affect our net income in various ways. We do not record interest income on nonaccrual loans or OREO, and these assets require higher loan administration and other costs, thereby adversely affecting our income.
Financial services institutions are interrelated as a result of trading, clearing, counterparty, or other relationships. We have exposure to many different industries and counterparties, and routinely execute transactions with counterparties in the financial services industry, including brokers and dealers, commercial banks, investment banks, and other institutional clients.
Defaults by or deteriorating asset quality of other financial institutions could adversely affect us. Financial services institutions are interrelated as a result of trading, clearing, counterparty, or other relationships. We routinely execute transactions with counterparties in the financial services industry, including brokers and dealers, commercial banks, investment banks, and other institutional clients.
Any losses or impairments to the carrying value of these investments or other changes may adversely affect our business, financial condition, results of operations, or cash flows.
Any losses or impairments to the carrying value of these investments or other changes may adversely affect our business, financial condition, results of operations, or cash flows. New lines of business, new products and services, or strategic project initiatives may subject us to additional risks.
As a result, customers may choose to maintain deposits with large financial institutions or invest in higher yielding short-term fixed income securities, all of which could materially adversely impact the Company's liquidity, loan funding capacity, net interest margin, capital and results of operations.
Additionally, although the industry has stabilized since these failures and the customer confidence in the safety and soundness of smaller regional and community banks has improved, the risk remains that customers may choose to maintain deposits with large financial institutions or invest in higher yielding short-term fixed income securities, all of which could materially adversely impact the Company's liquidity, loan funding capacity, net interest margin, capital and results of operations.
An interruption or failure of the services we receive through these outsourced systems could cause an interruption of our operations. The occurrence of any systems failure or interruption could damage our reputation and result in a loss of customers and business, could subject us to additional regulatory scrutiny, or could expose us to legal liability.
The occurrence of any systems failure or interruption could damage our reputation and result in a loss of customers and business, could subject us to additional regulatory scrutiny, or could expose us to legal liability. Any of these occurrences could have a material adverse effect on our business, financial condition, results of operations, or cash flows.
Factors in management’s determination include the performance of the business, including the ability to generate future taxable income. Realizing a deferred tax asset requires us to apply significant judgment and such judgment is inherently speculative because it requires estimates that cannot be made with certainty.
Realizing a deferred tax asset requires us to apply significant judgment and such judgment is inherently speculative because it requires estimates that cannot be made with certainty.
Similarly, there can be no assurance that these U.S. government entities will act in a similar fashion in the event of the future closure or failure of any other banks or financial institutions. The cost of resolving the recent bank failures may prompt the FDIC to charge higher premiums above the current levels or to issue additional special assessments.
Similarly, there can be no assurance that there will not be additional bank failures or issues in the broader financial system or that these U.S. government entities will act in a similar fashion in the event of the future closure or failure of any other banks or financial institutions.
Our business may be adversely affected by economic conditions in general and by conditions in the financial markets. We are exposed to downturns in the U.S. economy and market conditions generally. We cannot accurately predict the possibility of the national or local economy’s return to a period of economic weakness or to recessionary conditions.
We are exposed to downturns in the U.S. economy and market conditions generally. We cannot accurately predict the possibility of the national or local economy’s return to a period of economic weakness or to recessionary conditions. Our primary markets are concentrated the in Miami-Dade, Broward, Palm Beach and Hillsborough (Tampa) counties in Florida.
We may be unable to effectively implement new technology-driven enhancements of products and services as quickly or at the costs anticipated, which could impair our ability to realize the anticipated benefits from such new technology or require us to incur significant costs to remedy any such challenges in a timely manner. 43 Table of Contents Many larger competitors have substantially greater resources to invest in technological improvements and, increasingly, non-banking firms are using technology to compete with traditional lenders for loans and other banking services.
We may be unable to effectively implement new technology-driven enhancements of products and services as quickly or at the costs anticipated, which could impair our ability to realize the anticipated benefits from such new technology or require us to incur significant costs to remedy any such challenges in a timely manner.
Further, if we declare bankruptcy, dissolve, or liquidate, the holders of the Senior Notes, the Subordinated Notes and the Debentures must be satisfied before any distributions can be made to the holders of our common stock. 53 Table of Contents The stock price of financial institutions, like Amerant, may fluctuate significantly.
Further, if we declare bankruptcy, dissolve, or liquidate, the holders of these debt instruments must be satisfied before any distributions can be made to the holders of our common stock. The stock price of financial institutions, like Amerant, may fluctuate significantly. We cannot predict the prices at which our shares of common stock will continue to trade.
If the goodwill has been impaired, we must write down the goodwill by the amount of the impairment, with a corresponding charge to net income. Based on the annual impairment analysis, as of December 31, 2023, we recorded a $1.7 million pre-tax write off in goodwill and other intangibles assets.
If the goodwill has been impaired, we must write down the goodwill by the amount of the impairment, with a corresponding charge to net income. Based on the annual impairment analysis, the Company determined that goodwill was not impaired as of December 31, 2024.
The financial services industry is undergoing rapid technological changes with frequent introductions of new technology-driven products and services. In addition to allowing us to service our clients better, the effective use of technology may increase efficiency and may enable financial institutions to reduce costs and the risks associated with fraud and other operational risks.
In addition to allowing us to service our clients better, the effective use of technology may increase efficiency and may enable financial institutions to reduce costs and the risks associated with fraud and other operational risks. Our future success will partially depend upon our ability to use technology effectively.
We rely heavily on communications and information systems, including those provided by third-party service providers, to conduct our business.
Our information systems are exposed to cybersecurity threats and may experience interruptions and security breaches that could adversely affect our business and reputation. We rely heavily on communications and information systems, including those provided by third-party service providers, to conduct our business.
The nature, effects and timing of legislative and regulatory changes, cannot be predicted. Changes, if adopted, could require us to maintain more capital, liquidity, or adopt changes to our operating policies and procedures and risk controls which could adversely affect our growth, profitability and financial condition.
Changes, if adopted, could require us to maintain more capital, liquidity, or adopt changes to our operating policies and procedures and risk controls which could adversely affect our growth, profitability and financial condition. Compliance with applicable laws and regulations is time consuming and costly and may affect our profitability.
Compliance with applicable laws and regulations is time consuming and costly and may affect our profitability. Additionally, banks with greater than $10 billion in total consolidated assets are subject to additional regulatory requirements. As of December 31, 2023, our total assets were $9.7 billion.
Additionally, banks with greater than $10 billion in total consolidated assets are subject to additional regulatory requirements. As of December 31, 2024, our total assets were $9.9 billion. Based on our current total assets and growth strategy, we anticipate our total assets may exceed $10 billion in 2025.
Our success is impacted by regulations affecting banks and bank holding companies, and the securities markets, and our costs of compliance could adversely affect our earnings. Banking regulations are primarily intended to protect depositors, consumers and the FDIC’s DIF, not shareholders. The financial services industry also is subject to frequent legislative and regulatory changes.
Banking regulations are primarily intended to protect depositors, consumers and the FDIC’s DIF, not shareholders. The financial services industry also is subject to frequent legislative and regulatory changes. The nature, effects and timing of legislative and regulatory changes, cannot be predicted.
If the current levels of financial market and economic disruption, volatility and decreased levels of customer confidence continue or worsen, there can be no assurance that we will not experience adverse effects, which may materially impact our liquidity, business, financial condition, and results of operations.
Any future events that cause financial market and economic disruption, volatility and decreased levels of customer confidence may cause us to experience adverse effects, which may materially impact our liquidity, business, financial condition, and results of operations. Our business may be adversely affected by economic conditions in general and by conditions in the financial markets.
These risks have increased in light of remote and hybrid work arrangements that were implemented in response to the COVID-19 pandemic, and currently remain in effect. We may not have the ability or resources to keep pace with rapid technological changes in the financial services industry or implement new technology effectively.
We may not have the ability or resources to keep pace with rapid technological changes in the financial services industry or implement new technology effectively. The financial services industry is undergoing rapid technological changes with frequent introductions of new technology-driven products and services.
We have a net deferred tax asset that may or may not be fully realized. Deferred income tax represents the tax effect of the timing differences between financial accounting and tax reporting. Deferred tax assets, or DTAs, are assessed periodically by management to determine whether they are realizable.
Notwithstanding the foregoing, the results of impairment testing on our goodwill or other intangible assets have no impact on our tangible book value or regulatory capital levels. We have a net deferred tax asset that may or may not be fully realized. Deferred income tax represents the tax effect of the timing differences between financial accounting and tax reporting.
Risks Related to Regulatory and Legal Matters We are subject to extensive regulation that could limit or restrict our activities and adversely affect our earnings. Several regulators, including the Federal Reserve, the OCC, the FDIC, the Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the Cayman Islands Monetary Authority, regulate us and our subsidiaries .
Several regulators, including the Federal Reserve, the OCC, the FDIC, the Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the Cayman Islands Monetary Authority, regulate us and our subsidiaries . Our success is impacted by regulations affecting banks and bank holding companies, and the securities markets, and our costs of compliance could adversely affect our earnings.
If we record any future impairment loss related to our goodwill or other intangible assets, it could adversely affect our business, financial condition, results of operations, or cash flows. Notwithstanding the foregoing, the results of impairment testing on our goodwill or other intangible assets have no impact on our tangible book value or regulatory capital levels.
In 2024, the Company recorded a $0.3 million pre-tax write off in other intangibles assets in connection with the Houston Sale Transaction If we record any future impairment loss related to our goodwill or other intangible assets, it could adversely affect our business, financial condition, results of operations, or cash flows.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeMembers of this department include individuals with varying degrees of education and experience, in particular, our Chief Information Security Officer has over twenty years of experience in information technology and risk management, with emphasis on information security and cyber security risk management; throughout his career he has served in different positions including as Information Technology Auditor, Technology Risk Manager, Information Security Program Manager and, since September 2018 as our CISO.
Biggest changeMembers of this department include individuals with varying degrees of education and experience, in particular, our Chief Information Security Officer has over twenty seven years of experience in information technology and risk management, with emphasis on information security and cyber security risk management; throughout his career he has served in different positions including as Information Technology Auditor, Technology Risk Manager, Information Security Program Manager and, since September 2018 as our CISO.
A customer security awareness and communication program has also been developed and implemented to keep customers abreast of security and fraud risks. 57 While we believe that our business, financial condition, or results of operations have not been materially adversely affected by any cybersecurity incidents, cybersecurity threats are common and pervasive and, we, as well as our customers, regulators, and service providers, have experienced and will likely continue to experience a significant increase in information security and cybersecurity threats and attacks, see “Our information systems are exposed to cybersecurity threats and may experience interruptions and security breaches that could adversely affect our business and reputation” in Item 1A.
A customer security awareness and communication program has also been developed and implemented to keep customers abreast of security and fraud risks. 65 While we believe that our business, financial condition, or results of operations have not been materially adversely affected by any cybersecurity incidents, cybersecurity threats are common and pervasive and, we, as well as our customers, regulators, and service providers, have experienced and will likely continue to experience a significant increase in information security and cybersecurity threats and attacks, see “Our information systems are exposed to cybersecurity threats and may experience interruptions and security breaches that could adversely affect our business and reputation” in Item 1A.
Our Chief Information Security Officer presents quarterly reports to the Risk Committee regarding our information security program, including relevant information on key risk and performance indicators related to cybersecurity matters as well as significant cybersecurity and privacy events. In addition, our information security risk profile is presented to the Risk Committee on a semi-annual basis. 58
Our Chief Information Security Officer presents quarterly reports to the Risk Committee regarding our information security program, including relevant information on key risk and performance indicators related to cybersecurity matters as well as significant cybersecurity and privacy events. In addition, our information security risk profile is presented to the Risk Committee on a semi-annual basis. 66
He has a bachelor’s degree in computer systems analysis and has obtain several relevant certifications, including having completed the EC-Council’s Certified Chief Information Security Officer Program and obtaining the Information Systems Auditor and Risk and Information Systems Control certifications from the Information Systems Audit and Control Association, ISACA.
He has a bachelor’s degree in computer systems analysis and has obtained several relevant certifications, including having completed the EC-Council’s Certified Chief Information Security Officer Program and obtaining the Information Systems Auditor and Risk and Information Systems Control certifications from the Information Systems Audit and Control Association, ISACA.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur banking centers range from approximately 1,900 square feet to approximately 7,000 square feet, average approximately 3,750 square feet and total approximately 82,000 square feet. We opened a new Banking Center in Tampa, FL in 2024, which we also lease.
Biggest changeWe occupy 15 banking centers under lease agreements with renewal options, two banking centers with long term ground leases, and two banking centers are owned. Our banking centers range from approximately 1,000 square feet to approximately 7,000 square feet, average of 3,300 square feet and total approximately 64,000 square feet.
Item 2. PROPERTIES We conduct our business from our approximately 177,000 square foot headquarters building in Coral Gables, Florida (the “Headquarters Building”), located at 220 Alhambra Circle, Coral Gables, Florida 33134. In 2021, we sold the Headquarters Building, and leased-back the property for an eighteen-year term.
Item 2. PROPERTIES We conduct our business from our approximately 177,000 square foot headquarters building in Coral Gables, FL (the “Headquarters Building”), located at 220 Alhambra Circle, Coral Gables, FL 33134. In 2021, we sold the Headquarters Building, and leased-back the property for an eighteen-year term.
As of December 31, 2023 we occupied approximately 60,000 square feet, or approximately 34%, of the Headquarters Building, with the remaining approximately 117,000 square feet, or approximately 66%, either leased to third-parties or available for lease. In January 2024, we leased to a third-party approximately 19,000 square feet which we previously occupied.
In January 2024, we leased to a third-party approximately 19,000 square feet which we previously occupied. As a result, as of December 31, 2024 we occupied approximately 42,000 square feet, or approximately 23%, of the Headquarters Building, with the remaining approximately 135,000 square feet, or approximately 77%, either leased to third-parties or available for lease.
As a result, we now occupy approximately 41,000 square feet, or approximately 23%, of the Headquarters Building. Additionally, a significant portion of our support service units now operate out of our new operations center in the Miramar Park of Commerce (the “Miramar Operations Center”), located at 10500 Marks Way, Miramar, Florida 33025.
Additionally, a significant portion of our support service units operate out of our new operations center in the Miramar Park of Commerce (the “Miramar Operations Center”), located at 10500 Marks Way, Miramar, FL 33025.
In addition to the banking centers, we lease approximately 14,000 square feet in Houston, Texas, which we use as our Texas regional office. We lease approximately 6,000 square feet in New York City, which was used as a LPO for CRE loans. We closed our New York CRE LPO in 2021. We subleased this property in January 2022.
We opened a new banking center in Tampa, FL in 2024, which we also lease. We lease approximately 6,000 square feet in New York City, which was used as an LPO for CRE loans. We closed our New York CRE LPO in 2021, and subsequently subleased this property in January 2022.
We also lease one location in Tampa, Florida which is primarily used as an LPO for C&I and CRE banking activities. In February 2023, the Company executed a new lease for 14,416 square feet office space in Tampa, Florida, which now houses our recently opened banking center and where our new Tampa Regional Office will be.
In February 2023, the Company executed a new lease for 14,416 square feet office space in Tampa, FL, which now houses our recently opened banking center and where our new Tampa Regional Office is. In October 2023, the Company leased 12,702 square feet in Plantation, FL, for our Broward county regional office.
Following the sale of the Beacon Operations Center, the Company leased-back the property for a two-year term ending on or before June 2023, including monthly rental periods. The Miramar Operations Center has a more efficient layout which allowed us to reduce our space to approximately 56,500 square feet from approximately 100,000 at the Old Beacon Operations Center.
The Miramar Operations Center has a more efficient layout which allowed us to reduce our space to approximately 56,500 square feet from approximately 100,000 at the previous operations center. As of December 31, 2024, we had 19 banking centers, all located in Florida.
Our various leases have periodic escalation clauses and may have options for extensions and other customary terms. 59 Table of Contents
In June 2024, we also leased 5,172 square feet in West Palm Beach, FL, which will have a new banking center and the West Palm Beach county regional office. Our various leases have periodic escalation clauses and may have options for extensions and other customary terms. 67 Table of Contents
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In 2023, we completed the relocation to the new Miramar Operations Center from the previous operations center located in the Beacon Industrial Park area of Doral, Florida (the “Old Beacon Operations Center”). In 2020, the Company sold the Old Beacon Operations Center.
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As of December 31, 2023, we had 22 banking centers, including 16 in Florida and six in Texas. We occupy 15 banking centers under lease agreements, four banking centers with long term ground leases subject to long-term land leases of 20 to 30 years, each with an option, or options to renew.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeFor those matters where it is probable that we will incur a loss and the amount of the loss can be reasonably estimated, we record a liability in our consolidated financial statements. These legal reserves may be increased or decreased to reflect any relevant developments based on our quarterly reviews.
Biggest changeIf a loss is probable and reasonably estimable, we record a liability in our consolidated financial statements, adjusting reserves as necessary to reflect new developments. If the likelihood of loss is not probable or cannot be reasonably estimated, no reserve is recorded.
Item 3. LEGAL PROCEEDINGS We are, from time to time, in the ordinary course, engaged in litigation, and we have a small number of unresolved claims pending.
Item 3. LEGAL PROCEEDINGS From time to time, in the ordinary course of business, we are involved in litigation, regulatory matters and other legal proceedings.
Based on information currently available to us, advice of counsel, and available insurance coverage, we believe that our established reserves are adequate and the liabilities arising from the legal proceedings will not have a material adverse effect on our consolidated financial condition.
Based on current information, including insurance coverage, existing legal reserves, and ongoing legal assessments, we do not believe that liabilities arising from pending legal proceedings will materially impact our financial condition.
As a result, the outcome of a particular matter or a combination of matters, if unfavorable, may be material to our financial position, results of operations or cash flows for a particular period, depending upon the size of the loss or our income for that particular period. Item 4. MINE SAFETY DISCLOSURES Not applicable. 60 Table of Contents PART II
However, due to the inherent uncertainty in litigation and regulatory matters, the final resolution of one or more cases can have a material effect on our financial position, results of operations, or cash flows in a particular reporting period. Item 4. MINE SAFETY DISCLOSURES Not applicable. 68 Table of Contents PART II
Where appropriate, reserves for these various matters of litigation are established, under FASB ASC Topic 450, Contingencies, based in part upon management’s judgment and the advice of legal counsel. At least quarterly, we assess our liabilities and contingencies in connection with outstanding legal proceedings utilizing the latest information available.
Where appropriate, we establish reserves for potential losses in accordance with FASB ASC Topic 450, Contingencies, considering available information, management’s judgment and legal counsel’s guidance. At least quarterly, we evaluate legal contingencies using the most current information available.
In addition, as part of the ordinary course of business, we are parties to litigation involving claims relating to the ownership of funds in particular accounts, the collection of delinquent accounts, credit relationships, challenges to security interests in collateral and foreclosure interests, which are incidental to our regular business activities.
These may include, but are not limited to, claims related to the ownership of funds in specific accounts, disputes over credit relationships, challenges to security interests in collateral, and foreclosure proceedings, employment-related claims and general tort matters. Such matters are incidental to our regular banking and lending operations.
Removed
While the ultimate liability with respect to these other litigation matters and claims cannot be determined at this time, we believe that potential liabilities relating to pending matters are not likely to be material to our financial position, results of operations or cash flows.
Added
While the outcome of legal proceedings is inherently uncertain, based on management’s current assessment and legal counsel’s advice, we do not believe that any pending litigation will have a material adverse effect on our financial position, results of operations or cash flows.
Removed
For other matters, where a loss is not probable or the amount of the loss cannot be estimated, we have not accrued legal reserves, consistent with applicable accounting guidance.
Removed
We note, however, that in light of the inherent uncertainty in legal proceedings there can be no assurance that the ultimate resolution will not exceed established reserves.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePursuant to S&P Global Market Intelligence data, August 29, 2018 is the first date pricing information was available for our common stock and no trading occurred until August 29, 2018. 62 Table of Contents Total Return Performance (in Dollars) August 29, 2018 December 31, 2018 December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 AMTB $ 100.00 $ 72.28 $ 121.05 $ 84.44 $ 191.94 $ 149.11 $ 136.50 NYSE Composite Index 100.00 86.61 105.95 110.60 130.70 115.63 128.33 NASDAQ Composite Index 100.00 81.82 110.64 158.92 192.92 129.06 185.10 KBW Bank Index 100.00 77.27 102.11 88.19 119.09 90.84 86.49 The above graph and table illustrate the performance of Company Class A from August 29, 2018, the first day that pricing information was available, and reflect: • the Spin-off; • the IPO; and • the Clean-up Merger, under which terms each outstanding share of Class B common stock was automatically converted to 0.95 of a share of Class A common stock.
Biggest changeCumulative total return expressed in Dollars assumes an investment of $100 on December 31, 2019 and reinvestment of dividends as paid. 70 Table of Contents Total Return Performance (in Dollars) December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 AMTB $ 100.00 $ 69.76 $ 158.56 $ 123.18 $ 112.76 $ 102.85 NYSE Composite Index 100.00 104.40 123.37 109.14 121.13 137.26 KBW Nasdaq Bank Index 100.00 86.37 116.63 88.96 84.70 112.44 The above graph and table illustrate the performance of Company Class A from December 31, 2019 and reflect: • the Clean-up Merger, under which terms each outstanding share of Class B common stock was automatically converted to 0.95 of a share of Class A common stock.
Future dividends, if any, will be subject to our Board of Directors’ discretion and will depend on a number of factors including, among other things, upon our results of operations, financial condition, liquidity, capital adequacy, cash requirements, prospects, regulatory capital and limitations, and other factors that our Board of Directors may deem relevant as well as applicable federal and state regulations.
Future dividends, if any, will be subject to our Board of Directors’ discretion and will depend on a number of factors including, among other things, upon our results of operations, financial condition, liquidity, capital adequacy, cash requirements, prospects, regulatory capital limitations, and other factors that our Board of Directors may deem relevant as well as applicable federal and state regulations.
For further information, see “Supervision and Regulation—Payment of Dividends.” 61 Table of Contents Stock Performance Graph The following stock performance graph and related disclosures do not constitute soliciting material and should not be deemed filed or incorporated by reference into any other filing by us under the Securities Act or the Exchange Act, except to the extent we specifically incorporate them by reference therein.
For further information, see “Supervision and Regulation—Payment of Dividends and Repurchases.” 69 Table of Contents Stock Performance Graph The following stock performance graph and related disclosures do not constitute soliciting material and should not be deemed filed or incorporated by reference into any other filing by us under the Securities Act or the Exchange Act, except to the extent we specifically incorporate them by reference therein.
Holders of record As of February 15, 2024, there were 385 shareholders of record of the Company’s Class A common stock. The shareholders of record include Cede & Co., a nominee for The Depository Trust Company, or DTC, which holds shares of our Class A common stock on behalf of an indeterminate number of beneficial owners.
Holders of record As of February 27, 2025, there were 382 shareholders of record of the Company’s Class A common stock. The shareholders of record include Cede & Co., a nominee for The Depository Trust Company, or DTC, which holds shares of our Class A common stock on behalf of an indeterminate number of beneficial owners.
The following graph compares the cumulative total return of the Class A common stock from August 29, 2018 to December 31, 2023, as compared to the cumulative total return on stocks included in the NYSE Composite Index, the NASDAQ Composite Index and the KBW Nasdaq Bank Index over such period.
The following graph compares the cumulative total return of the Class A common stock during the five years ended December 31, 2024, as compared to the cumulative total return on stocks included in the NYSE Composite Index, and the KBW Nasdaq Bank Index over such period.
Dividends In January 2024 and each of the four quarters of 2023 and 2022, the Company’s Board of Directors declared a cash dividend of $0.09 per share of the Company’s Class A common stock. The Company declared cash dividends in an amount of $0.06 per share of common stock on December 8, 2021.
Dividends In January 2025 and each of the four quarters of 2024 and 2023, the Company’s Board of Directors declared a cash dividend of $0.09 per share of the Company’s Class A common stock.
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Previously and until August 28, 2023, the Company’s Class A common Stock were listed and traded on the Nasdaq Global Select Market, or NASDAQ.
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Until November 17, 2021 the Company’s shares of Class B common stock, par value $0.10 per share, were also listed and traded on the NASDAQ under the symbol “AMTBB”, on November 18, 2021 these shares were converted into shares of Class A common stock. S ee “Our History” under Item 1. Business.
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Cumulative total return expressed in Dollars assumes an investment of $100 on August 29, 2018 and reinvestment of dividends as paid. In 2022, because our Class A common stock was traded on NASDAQ, we used the NASDAQ Composite Index as our broad equity market index.
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As previously discussed, we voluntarily transferred the listing of our Class A common stock to the NYSE on August 29, 2023.
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As a result, we have changed our broad equity market index for purposes of disclosure in the stock performance graph to the NYSE Composite Index and have included returns in the stock performance graph based on both of these indices.
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In future periods, we will no longer reference the NASDAQ Composite Index in comparing total shareholder returns on our Class A common stock. We did not change our line-of-business index, which is the KBW Nasdaq Bank Index, as a result of our transfer to the NYSE.
Removed
(1) Shares of Company Class A common stock were distributed in the Spin-off at the end of the day on Friday, August 10, 2018 and were listed for trading beginning on Monday, August 13, 2018.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

287 edited+74 added−129 removed162 unchanged
Biggest changeYears Ended December 31, 2023 2022 2021 (in thousands, except percentages) Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Interest-earning assets: Loan portfolio, net (1) (2) $ 7,006,919 $ 475,405 6.78 % $ 5,963,190 $ 293,210 4.92 % $ 5,514,110 $ 216,097 3.92 % Debt securities available for sale (3)(4) 1,053,034 43,096 4.09 % 1,112,590 33,187 2.98 % 1,194,505 26,953 2.26 % Debt securities held to maturity (5) 234,168 7,997 3.42 % 192,397 5,657 2.94 % 97,501 2,036 2.09 % Debt securities held for trading 586 7 1.19 % 64 4 6.25 % 165 5 3.03 % Equity securities with readily determinable fair value not held for trading 2,454 33 1.34 % 9,560 — — % 22,332 284 1.27 % Federal Reserve Bank and FHLB stock 53,608 3,727 6.95 % 51,496 2,565 4.98 % 53,106 2,222 4.18 % Deposits with banks 322,853 18,212 5.64 % 231,402 4,153 1.79 % 201,950 247 0.12 % Other short-term investments 2,115 102 4.80 % — — — % — — — % Total interest-earning assets 8,675,737 548,579 6.32 % 7,560,699 338,776 4.48 % 7,083,669 247,844 3.50 % Total non-interest-earning assets (6) 776,484 626,989 449,347 Total assets $ 9,452,221 $ 8,187,688 $ 7,533,016 73 Table of Contents Years Ended December 31, 2023 2022 2021 (in thousands, except percentages) Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Interest-bearing liabilities: Checking and saving accounts: Interest bearing DDA 2,486,190 62,551 2.52 % 1,872,100 15,118 0.81 % 1,309,699 591 0.05 % Money market 1,226,311 42,212 3.44 % 1,323,563 11,673 0.88 % 1,311,278 3,483 0.27 % Savings 284,510 144 0.05 % 319,631 135 0.04 % 324,618 50 0.02 % Total checking and saving accounts 3,997,011 104,907 2.62 % 3,515,294 26,926 0.77 % 2,945,595 4,124 0.14 % Time deposits 2,074,549 78,829 3.80 % 1,334,605 22,124 1.66 % 1,668,459 23,766 1.42 % Total deposits 6,071,560 183,736 3.03 % 4,849,899 49,050 1.01 % 4,614,054 27,890 0.60 % Securities sold under agreements to repurchase 124 7 5.65 % 32 1 3.13 % 123 1 0.81 % Advances from the FHLB and other borrowings (7) 805,084 28,816 3.58 % 911,448 15,092 1.66 % 822,769 8,595 1.04 % Senior notes 59,370 3,766 6.34 % 59,054 3,766 6.38 % 58,737 3,768 6.42 % Subordinated notes 29,370 1,445 4.92 % 23,853 1,172 4.91 % — — — % Junior subordinated debentures 64,178 4,345 6.77 % 64,178 3,030 4.72 % 64,178 2,449 3.82 % Total interest-bearing liabilities 7,029,686 222,115 3.16 % 5,908,464 72,111 1.22 % 5,559,861 42,703 0.77 % Non-interest-bearing liabilities: Non-interest bearing demand deposits 1,356,538 1,286,570 1,046,766 Accounts payable, accrued liabilities and other liabilities 325,367 243,105 130,548 Total non-interest-bearing liabilities 1,681,905 1,529,675 1,177,314 Total liabilities 8,711,591 7,438,139 6,737,175 Stockholders' equity 740,630 749,549 795,841 Total liabilities and stockholders' equity $ 9,452,221 $ 8,187,688 $ 7,533,016 Excess of average interest-earning assets over average interest-bearing liabilities $ 1,646,051 $ 1,652,235 $ 1,523,808 Net interest income $ 326,464 $ 266,665 $ 205,141 Net interest rate spread 3.16 % 3.26 % 2.73 % Net interest margin (8) 3.76 % 3.53 % 2.90 % Cost of total deposits (9) 2.47 % 0.80 % 0.49 % Ratio of average interest-earning assets to average interest-bearing liabilities 123.42 % 127.96 % 127.41 % Average non-performing loans/ average total loans 0.48 % 0.51 % 1.61 % __________________ (1) Includes loans held for investment net of the allowance for credit losses, and loans held for sale.
Biggest changeYears Ended December 31, 2024 2023 2022 (in thousands, except percentages) Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Interest-earning assets: Loan portfolio, net (1) (2) $ 7,157,991 $ 505,484 7.06 % $ 7,006,919 $ 475,405 6.78 % $ 5,963,190 $ 293,210 4.92 % Debt securities available for sale (3)(4) 1,291,974 57,631 4.46 % 1,053,034 43,096 4.09 % 1,112,590 33,187 2.98 % Debt securities held to maturity (5) 162,657 5,597 3.44 % 234,168 7,997 3.42 % 192,397 5,657 2.94 % Debt securities held for trading — — — % 586 7 1.19 % 64 4 6.25 % Equity securities with readily determinable fair value not held for trading 2,495 106 4.25 % 2,454 33 1.34 % 9,560 — — % Federal Reserve Bank and FHLB stock 56,234 3,957 7.04 % 53,608 3,727 6.95 % 51,496 2,565 4.98 % Deposits with banks 423,185 22,492 5.31 % 322,853 18,212 5.64 % 231,402 4,153 1.79 % Other short-term investments 6,348 322 5.07 % 2,115 102 4.80 % — — — % Total interest-earning assets 9,100,884 595,589 6.54 % 8,675,737 548,579 6.32 % 7,560,699 338,776 4.48 % Total non-interest-earning assets (6) 790,919 776,484 626,989 Total assets $ 9,891,803 $ 9,452,221 $ 8,187,688 80 Table of Contents Years Ended December 31, 2024 2023 2022 (in thousands, except percentages) Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Average Balances Income/ Expense Yield/ Rates Interest-bearing liabilities: Checking and saving accounts: Interest bearing DDA 2,345,193 62,719 2.67 % 2,486,190 62,551 2.52 % 1,872,100 15,118 0.81 % Money market 1,502,304 62,307 4.15 % 1,226,311 42,212 3.44 % 1,323,563 11,673 0.88 % Savings 251,626 103 0.04 % 284,510 144 0.05 % 319,631 135 0.04 % Total checking and saving accounts 4,099,123 125,129 3.05 % 3,997,011 104,907 2.62 % 3,515,294 26,926 0.77 % Time deposits 2,302,798 105,780 4.59 % 2,074,549 78,829 3.80 % 1,334,605 22,124 1.66 % Total deposits 6,401,921 230,909 3.61 % 6,071,560 183,736 3.03 % 4,849,899 49,050 1.01 % Securities sold under agreements to repurchase 60 3 5.00 % 124 7 5.65 % 32 1 3.13 % Advances from the FHLB and other borrowings (7) 757,502 29,303 3.87 % 805,084 28,816 3.58 % 911,448 15,092 1.66 % Senior notes 59,686 3,767 6.31 % 59,370 3,766 6.34 % 59,054 3,766 6.38 % Subordinated notes 29,540 1,444 4.89 % 29,370 1,445 4.92 % 23,853 1,172 4.91 % Junior subordinated debentures 64,178 4,206 6.55 % 64,178 4,345 6.77 % 64,178 3,030 4.72 % Total interest-bearing liabilities 7,312,887 269,632 3.69 % 7,029,686 222,115 3.16 % 5,908,464 72,111 1.22 % Non-interest-bearing liabilities: Non-interest bearing demand deposits 1,461,940 1,356,538 1,286,570 Accounts payable, accrued liabilities and other liabilities 324,932 325,367 243,105 Total non-interest-bearing liabilities 1,786,872 1,681,905 1,529,675 Total liabilities 9,099,759 8,711,591 7,438,139 Stockholders' equity 792,044 740,630 749,549 Total liabilities and stockholders' equity $ 9,891,803 $ 9,452,221 $ 8,187,688 Excess of average interest-earning assets over average interest-bearing liabilities $ 1,787,997 $ 1,646,051 $ 1,652,235 Net interest income $ 325,957 $ 326,464 $ 266,665 Net interest rate spread 2.85 % 3.16 % 3.26 % Net interest margin (8) 3.58 % 3.76 % 3.53 % Cost of total deposits (9) 2.94 % 2.47 % 0.80 % Ratio of average interest-earning assets to average interest-bearing liabilities 124.45 % 123.42 % 127.96 % Average non-performing loans/ average total loans 1.03 % 0.48 % 0.51 % __________________ (1) Includes loans held for investment net of the allowance for credit losses, and loans held for sale.
Other non-routine items in noninterest expense in 2023 included: (i) losses on loans held for sale which includes a valuation expense of $35.5 million related to the transfer of the Houston CRE loan portfolio from loans held for investment to loans held for sale and a total loss of $7.6 million, including a $5.6 million valuation expense and a $2.0 million loss on sale, related to a New York-based CRE loan held for sale; (ii) a $2.6 million loss on sale of repossessed assets in connection with our equipment-financing activities; (iii) a $2.0 million impairment charge on an investment carried at cost and included as part of other assets; (iv) a $1.7 million goodwill and intangible impairment charge in 2023; and (iv) $1.1 million in expenses related to the enhancement of BOLI during the fourth quarter of 2023.
In 2023, non-routine items in noninterest expense in 2023 included: (i) losses on loans held for sale which includes a valuation expense of $35.5 million related to the transfer of the Houston CRE loan portfolio from loans held for investment to loans held for sale and a total loss of $7.6 million, including a $5.6 million valuation expense and a $2.0 million loss on sale, related to a New York-based CRE loan held for sale; (ii) a $2.6 million loss on sale of repossessed assets in connection with our equipment-financing activities; (iii) a $2.0 million impairment charge on an investment carried at cost and included as part of other assets; (iv) a $1.7 million goodwill and intangible impairment charge in 2023; and (iv) $1.1 million in expenses related to the enhancement of BOLI during the fourth quarter of 2023.
Charge-offs in 2023 included (i) $28.1 million related to multiple consumer loans, primarily purchased indirect consumer loans; (ii) $10.3 million related to one CRE New York-based multifamily loan; (iii) $7.0 million related to a transportation industry commercial loan relationship that was transferred to other repossessed assets in the first quarter of 2023 and subsequently sold in the second quarter of 2023; (iv) $8.0 million related to four commercial loans ranging between $1 million to $3 million; and (v) $6.5 million in connection with multiple smaller commercial and real estate loans.
In 2023, charge-offs included: (i) $28.1 million related to multiple consumer loans, primarily purchased indirect consumer loans; (ii) $10.3 million related to one CRE New York-based multifamily loan; (iii) $7.0 million related to a transportation industry commercial loan relationship that was transferred to other repossessed assets in the first quarter of 2023 and subsequently sold in the second quarter of 2023; (iv) $8.0 million related to four commercial loans ranging between $1 million to $3 million; and (v) $6.5 million in connection with multiple smaller commercial and real estate loans.
Re-evaluation of the ACL estimate in future periods, in light of changes in composition and characteristics of the loan portfolio, changes in the reasonable and supportable forecast and other factors then prevailing may result in material changes in the amount of the ACL and credit loss expense in those future periods.
Re-evaluation of the ACL estimate in future periods, in light of changes in composition and characteristics of the loan portfolio, changes in the reasonable and supportable forecast and other factors then prevailing may result in material changes in the amount of the ACL and credit loss expense in those future periods.
Factors that may be considered in aggregating loans for this purpose include but are not necessarily limited to, product or collateral type, industry, geography, internal risk rating, credit characteristics such as credit scores or collateral values, and historical or expected credit loss patterns.
Factors that may be considered in aggregating loans for this purpose include but are not necessarily limited to, product or collateral type, industry, geography, internal risk rating, credit characteristics such as credit scores or collateral values, and historical or expected credit loss patterns.
With respect to modifications made to borrowers experiencing financial difficulty, a change to the ACL is generally not recorded upon modification since the effect of these modifications is already included in the ACL given the measurement methodologies used to estimate the ACL.
With respect to modifications made to borrowers experiencing financial difficulty, a change to the ACL is generally not recorded upon modification since the effect of these modifications is already included in the ACL given the measurement methodologies used to estimate the ACL.
(6) In 2023, includes: (i) a fair value adjustment of $35.5 million related to an aggregate of $401 million in Houston-based CRE loans held for sale which are carried at the lower of cost or fair value, and (ii) a loss on sale of $2.0 million related to a New York-based CRE loan previously carried at the lower of fair value or cost.
In 2023, includes: (i) a fair value adjustment of $35.5 million related to an aggregate of $401 million in Houston-based CRE loans held for sale which are carried at the lower of cost or fair value, and (ii) a loss on sale of $2.0 million related to a New York-based CRE loan previously carried at the lower of fair value or cost.
In the fourth quarter of 2023, the Company transferred an aggregate of $401 million in Houston-based CRE loans held for investment to the loans held for sale category, and recognized a valuation allowance of $35.5 million as a result of the fair value adjustment of these loans .
In the fourth quarter of 2023, the Company transferred an aggregate of $401.0 million in Houston-based CRE loans held for investment to the loans held for sale category, and recognized a valuation allowance of $35.5 million as a result of the fair value adjustment of these loans.
In addition, in 2023, includes a fair value adjustment of $5.6 million related to a New York-based CRE loan held for sale carried at the lower of cost or fair value. In 2022, amount represents the fair value adjustment related to the New York loan portfolio held for sale carried at the lower of cost or fair value.
In addition, in 2023, includes a fair value adjustment of $5.6 million related to a New York-based CRE loan held for sale carried at the lower of cost or fair value. Lastly, in 2022, amount represents the fair value adjustment related to the New York loan portfolio held for sale carried at the lower of cost or fair value.
(7) In 2023, consists of losses on loans held for sale carried at the lower of cost or fair value, including valuation allowance as a result of changes in their fair value and losses on the sale of these loans.
(7) In 2024 and 2023, consists of losses on loans held for sale carried at the lower of cost or fair value, including valuation allowance as a result of changes in their fair value and losses on the sale of these loans.
Charge-offs in 2023, were partially offset primarily by: (i) $5.1 million recovery from a commodity trader charged-off in 2017; (ii) a $3.1 million recovery from a Miami-based U.S. coffee trader (“the Coffee Trader”) charged-off in the previous year; (iii) $1.4 million recovery from purchased consumer loans; and the remaining $2.1 million due to smaller multiple recoveries.
Charge-offs in 2023 were partially offset primarily by: (i) $5.1 million recovery from a commodity trader charged-off in 2017; (ii) a $3.1 million recovery from a Miami-based U.S. coffee trader (“the Coffee Trader”) charged-off in the previous year; (iii) $1.4 million recovery from purchased consumer loans; and (iv) the remaining $2.1 million is due to smaller multiple recoveries.
In 2023, 2022 and 2021, the tax equivalent yield was calculated assuming a 21% tax rate and dividing the actual yield by 0.79. (6) Excludes the allowance for credit losses. (7) The terms of the advance agreement require the Bank to maintain certain investment securities or loans as collateral for these advances.
In 2024, 2023 and 2022, the tax equivalent yield was calculated assuming a 21% tax rate and dividing the actual yield by 0.79. (6) Excludes the allowance for credit losses. (7) The terms of the advance agreement require the Bank to maintain certain investment securities or loans as collateral for these advances.
The amount of the principal forgiveness is deemed to be uncollectible; therefore, that portion of the loan is written off, resulting in a reduction of the amortized cost basis and a corresponding adjustment to the ACL. 102 Table of Contents Problem Loans. Loans are considered delinquent when principal or interest payments are past due 30 days or more.
The amount of the principal forgiveness is deemed to be uncollectible; therefore, that portion of the loan is written off, resulting in a reduction of the amortized cost basis and a corresponding adjustment to the ACL. 110 Table of Contents Problem Loans. Loans are considered delinquent when principal or interest payments are past due 30 days or more.
We currently anticipate that our available funds, credit facilities, and cash flows from operations will be sufficient to meet our operational cash needs for the foreseeable future. Other than the changes discussed herein, there have been no material changes to the contractual obligations previously disclosed in the 2022 Form 10-K.
We currently anticipate that our available funds, credit facilities, and cash flows from operations will be sufficient to meet our operational cash needs for the foreseeable future. Other than the changes discussed herein, there have been no material changes to the contractual obligations previously disclosed in the 2023 Form 10-K.
We provide individuals and businesses a comprehensive array of deposit, credit, investment, wealth management, retail banking, mortgage services, and fiduciary services. We serve customers in our United States markets and select international customers. These services are offered through the Bank, which is also headquartered in Coral Gables, Florida, and its subsidiaries.
We provide individuals and businesses a comprehensive array of deposit, credit, investment, wealth management, retail banking, mortgage services, and fiduciary services. We serve customers in our United States markets and select international customers. These services are offered through the Bank, which is also headquartered in Coral Gables, FL, and its subsidiaries.
These mainly include rental apartment (multifamily) properties, office, retail, warehouses and industrial facilities, and hospitality (hotels and motels) properties mainly in South Florida, the greater Houston, Texas area and the greater New York City area, especially the five New York City boroughs. Concentrations in these non-owner occupied CRE loans are subject to heightened regulatory scrutiny.
These mainly include rental apartment (multifamily) properties, office, retail, warehouses and industrial facilities, and hospitality (hotels and motels) properties mainly in South and Central Florida, Tampa, the greater Houston, Texas area and the greater New York City area, especially the five New York City boroughs. Concentrations in these non-owner occupied CRE loans are subject to heightened regulatory scrutiny.
In addition, the Company originates equipment loan and leases through a white-label equipment financing solution launched in the second quarter of 2022. 96 Table of Contents Commercial loans to borrowers in similar businesses or products with similar characteristics or specific credit requirements are generally evaluated under a standardized commercial credit program.
In addition, the Company originates equipment loan and leases through a white-label equipment financing solution launched in the second quarter of 2022. 104 Table of Contents Commercial loans to borrowers in similar businesses or products with similar characteristics or specific credit requirements are generally evaluated under a standardized commercial credit program.
There were no loans held for sale at December 31, 2022. 101 Table of Contents Loan Quality We use what we believe is a comprehensive methodology to monitor credit quality and manage credit concentrations within our loan portfolio. Our underwriting policies and practices govern the risk profile and credit and geographic concentrations of our loan portfolio.
There were no loans held for sale at December 31, 2022. 109 Table of Contents Loan Quality We use what we believe is a comprehensive methodology to monitor credit quality and manage credit concentrations within our loan portfolio. Our underwriting policies and practices govern the risk profile and credit and geographic concentrations of our loan portfolio.
The table below summarizes, by remaining maturity, our significant contractual cash obligations as of December 31, 2023. Amounts in this table reflect the minimum contractual obligation under legally enforceable contracts with terms that are both fixed and determinable. All other contractual cash obligations on this table are reflected in our consolidated balance sheet.
The table below summarizes, by remaining maturity, our significant contractual cash obligations as of December 31, 2024. Amounts in this table reflect the minimum contractual obligation under legally enforceable contracts with terms that are both fixed and determinable. All other contractual cash obligations on this table are reflected in our consolidated balance sheet.
We proactively and carefully monitor the Company’s credit quality practices, including examining and responding to patterns or trends that may arise across certain industries or regions. 81 Table of Contents Noninterest Income The table below sets forth a comparison for each of the categories of noninterest income for the periods presented.
We proactively and carefully monitor the Company’s credit quality practices, including examining and responding to patterns or trends that may arise across certain industries or regions. 87 Table of Contents Noninterest Income The table below sets forth a comparison for each of the categories of noninterest income for the periods presented.
The Company believes these securities are not credit-impaired because the change in fair value is attributable to changes in interest rates and investment securities markets, generally, and not credit quality. As a result, the Company did not record an allowance for credit losses on these securities as of December 31, 2023 and 2022.
The Company believes these securities are not credit-impaired because the change in fair value is attributable to changes in interest rates and investment securities markets, generally, and not credit quality. As a result, the Company did not record an allowance for credit losses on these securities as of December 31, 2024 and 2023.
The increase in effective duration in 2023 compared to 2022 was primarily due to lower than expected mortgage-backed securities prepayments.These estimates are computed using multiple inputs that are subject, among other things, to changes in interest rates and other factors that may affect prepayment speeds.
The increase in effective duration in 2024 compared to 2023 was primarily due to lower than expected mortgage-backed securities prepayments. These estimates are computed using multiple inputs that are subject, among other things, to changes in interest rates and other factors that may affect prepayment speeds.
Noninterest expenses in 2023 and 2022 include salaries and employee benefits, mortgage lending costs and professional and other service fees in connection with Amerant Mortgage’s ongoing business. Non-routine noninterest expense items include restructuring expenses and other non-routine noninterest expenses. Restructuring expenses are those incurred for actions designed to implement the Company’s business strategy.
Noninterest expenses in 2024 and 2023 include salaries and employee benefits, mortgage lending costs and professional and other service fees in connection with Amerant Mortgage’s ongoing business. Non-routine noninterest expense items include restructuring expenses and other non-routine noninterest expenses. Restructuring expenses are those incurred for actions designed to implement the Company’s business strategy.
An asset classified as loss is not considered collectable and is of such little value that the continuance of carrying a value on the books is not warranted. 106 Table of Contents We use the term “classified loans” to describe loans that are substandard and doubtful, and we use the term “criticized loans” to describe loans that are special mention and classified loans.
An asset classified as loss is not considered collectable and is of such little value that the continuance of carrying a value on the books is not warranted. 114 Table of Contents We use the term “classified loans” to describe loans that are substandard and doubtful, and we use the term “criticized loans” to describe loans that are special mention and classified loans.
On December 19, 2022, the Company announced that the Board of Directors authorized a new repurchase program pursuant to which the Company may purchase, from time to time, up to an aggregate amount of $25 million of its shares of Class A common stock (the “2023 Class A Common Stock Repurchase Program”).
Repurchase Plans Details On December 19, 2022, the Company announced that the Board of Directors authorized a new repurchase program pursuant to which the Company may purchase, from time to time, up to an aggregate amount of $25 million of its shares of Class A common stock (the “2023 Class A Common Stock Repurchase Program”).
The Company considers there are not current expected credit losses on these securities and, therefore, did not record an ACL on any of its debt securities held to maturity as of December 31, 2023 and 2022. The Company monitors the credit quality of held to maturity securities through the use of credit ratings.
The Company considers there are not current expected credit losses on these securities and, therefore, did not record an ACL on any of its debt securities held to maturity as of December 31, 2024 and 2023. The Company monitors the credit quality of held to maturity securities through the use of credit ratings.
(9) Calculated based upon the average balance of total noninterest bearing and interest bearing deposits. 75 Table of Contents Interest Rates and Operating Interest Differential Increases and decreases in interest income and interest expense result from changes in average balances (volume) of interest-earning assets and interest-bearing liabilities, as well as changes in average interest rates.
(9) Calculated based upon the average balance of total noninterest bearing and interest bearing deposits. 82 Table of Contents Interest Rates and Operating Interest Differential Increases and decreases in interest income and interest expense result from changes in average balances (volume) of interest-earning assets and interest-bearing liabilities, as well as changes in average interest rates.
The Company has not historically sold brokered CDs in denominations over $100,000. 116 Deposits by Type: Average Balances and Average Rates Paid The following table sets forth the average daily balance amounts and the average rates paid on our deposits for the periods presented.
The Company has not historically sold brokered CDs in denominations over $100,000. 125 Deposits by Type: Average Balances and Average Rates Paid The following table sets forth the average daily balance amounts and the average rates paid on our deposits for the periods presented.
The Company and the Bank opted to not include the AOCI in computing regulatory capital. As of December 31, 2023, management believes that the Company and the Bank meet all capital adequacy requirements to which they are subject, and are well-capitalized.
The Company and the Bank opted to not include the AOCI in computing regulatory capital. As of December 31, 2024, management believes that the Company and the Bank meet all capital adequacy requirements to which they are subject, and are well-capitalized.
In addition, Basel III rules required the Company and the Bank to hold a minimum capital conservation buffer of 2.50%. The Company’s capital conservation buffer at year end 2023 and 2022 was 4.1% and 4.4%, respectively, and therefore no regulatory restrictions exist under the applicable capital rules on dividends or discretionary bonuses or other payments.
In addition, Basel III rules required the Company and the Bank to hold a minimum capital conservation buffer of 2.50%. The Company’s capital conservation buffer at year end 2024 and 2023 was 5.4% and 4.1%, respectively, and therefore no regulatory restrictions exist under the applicable capital rules on dividends or discretionary bonuses or other payments.
The 2023 Class A Common Stock Repurchase Program was set to expire on December 31, 2023 and on December 15, 2023, the Company announced that the Board approved to extend the expiration date to December 31, 2024.
The 2023 Class A Common Stock Repurchase Program was set to expire on December 31, 2023 and on December 15, 2023, the Company announced that the Board approved to extend the expiration date to December 31, 2024. On December 11, 2024, the Company announced that the Board approved to extend the expiration date to December 31, 2025.
(3) Total loans, net is the principal balance of outstanding loans, including loans held for investment, loans held for sale carried at the lower of cost or fair value, and mortgage loans held for sale, net of unamortized deferred nonrefundable loan origination fees and loan origination costs, and unamortized premiums paid on purchased loans, excluding the allowance for credit losses. 91 Table of Contents The table below summarizes the composition of loans held for investment by type of loan as of the end of each period presented.
(3) Total loans, net is the principal balance of outstanding loans, including loans held for investment, loans held for sale carried at the lower of cost or fair value, and mortgage loans held for sale, net of unamortized deferred nonrefundable loan origination fees and loan origination costs, and unamortized premiums paid on purchased loans, adjusted by the allowance for credit losses. 99 Table of Contents The table below summarizes the composition of loans held for investment by type of loan as of the end of each period presented.
See Note 1 to our audited annual consolidated financial statements in this Form 10-K for details on the adoption of CECL. 127 T able of Contents Effects of Inflation and Changing Prices The consolidated financial statements and related consolidated financial data presented herein have been prepared in accordance with GAAP and practices within the banking industry, which require the measurement of financial position and operating results in terms of historical Dollars without considering the changes in the relative purchasing power of money over time due to inflation.
See Note 1 to our audited annual consolidated financial statements in this Form 10-K for details on the adoption of CECL. 134 Table of Contents Effects of Inflation and Changing Prices The consolidated financial statements and related consolidated financial data presented herein have been prepared in accordance with GAAP and practices within the banking industry, which require the measurement of financial position and operating results in terms of historical Dollars without considering the changes in the relative purchasing power of money over time due to inflation.
The following table sets forth information about the outstanding amounts of our short-term borrowings at the close of and for years ended December 31, 2023, 2022 and 2021.
The following table sets forth information about the outstanding amounts of our short-term borrowings at the close of and for years ended December 31, 2024, 2023 and 2022.
Advertising expenses are expensed as incurred, except for media production costs which are expensed upon the first airing of the advertisement. FDIC deposit and business insurance assessments and premiums include deposit insurance, net of any credits applied against these premiums, corporate liability and other business insurance premiums.
Advertising expenses are expensed as incurred, except for media production costs which are expensed upon the first airing of the advertisement. 74 Table of Contents FDIC deposit and business insurance assessments and premiums include deposit insurance, net of any credits applied against these premiums, corporate liability and other business insurance premiums.
The Company expects to collect the amortized cost basis of government insured residential loans due to the nature of the government guarantee and, therefore generally have no expected credit losses. 132 T able of Contents Expected credit losses on loans to borrowers that are domiciled in foreign countries, primarily loans in the Consumer and Financial Institutions portfolios are generally estimated by assessing the any available cash or other types of collateral, and the probability of losses arising from the Company’s exposure to those collateral assets.
The Company expects to collect the amortized cost basis of government insured residential loans due to the nature of the government guarantee and, therefore generally have no expected credit losses. 139 Table of Contents Expected credit losses on loans to borrowers that are domiciled in foreign countries, primarily loans in the Consumer and Financial Institutions portfolios are generally estimated by assessing the any available cash or other types of collateral, and the probability of losses arising from the Company’s exposure to those collateral assets.
Interest income that would have been recognized on outstanding non-performing loans at December 31, 2023, 2022 and 2021, was $4.9 million, $0.8 million and $6.2 million, respectively. (3) Includes the average balance of net unrealized gains and losses in the fair value of debt securities available for sale.
Interest income that would have been recognized on outstanding non-performing loans at December 31, 2024, 2023 and 2022, was $3.9 million, $4.9 million and $0.8 million, respectively. (3) Includes the average balance of net unrealized gains and losses in the fair value of debt securities available for sale.
Credit ratings are monitored by the Company on at least a quarterly basis. As of December 31, 2023 and 2022, all held to maturity securities held by the Company were rated investment grade. 112 Table of Contents The following table sets forth the book value, scheduled maturities and weighted average yields for our securities portfolio at December 31, 2023.
Credit ratings are monitored by the Company on at least a quarterly basis. As of December 31, 2024 and 2023, all held to maturity securities held by the Company were rated investment grade. 121 Table of Contents The following table sets forth the book value, scheduled maturities and weighted average yields for our securities portfolio at December 31, 2024.
Also in 2023, includes additional costs of $1.1 million in connection with the restructuring of the Company’s BOLI as well as an impairment charge of $2.0 million related to an investment carried at cost and included in other assets .
Also in 2023, 90 Table of Contents includes additional costs of $1.1 million in connection with the restructuring of the Company’s BOLI as well as an impairment charge of $2.0 million related to an investment carried at cost and included in other assets .
Furthermore, at December 31, 2023, the Company’s cash and cash equivalents included other short-term investments of $6.1 million which consists of U.S. Treasury Bills that mature in 90 days or less.
Furthermore, at December 31, 2024 and 2023, the Company’s cash and cash equivalents included other short-term investments of $6.9 million and $6.1 million, respectively, which consists of U.S. Treasury Bills that mature in 90 days or less.
(12) Includes $14.4 million, $12.5 million and $7.1 million in 2023, 2022 and 2021, respectively, related to mortgage banking activities, primarily consisting of salaries and employee benefits, mortgage lending costs and professional and other services fees.
(12) Includes $14.1 million, $14.4 million and $12.5 million in 2024, 2023 and 2022, respectively, related to mortgage banking activities, primarily consisting of salaries and employee benefits, mortgage lending costs and professional and other services fees.
See our Annual Report on Form 10-K for the year ended December 31, 2022 for additional details on the Company’s financial condition and results of operations in 2022 and changes in the Company’s financial condition and results of operations from 2021 to 2022. Overview Our Company We are a bank holding company headquartered in Coral Gables, Florida.
See our Annual Report on Form 10-K for the year ended December 31, 2023 for additional details on the Company’s financial condition and results of operations in 2023 and changes in the Company’s financial condition and results of operations from 2022 to 2023 . Overview Our Company We are a bank holding company headquartered in Coral Gables, FL.
Re-evaluation of the ACL estimate in future periods, in light of changes in composition and characteristics of the loan portfolio, changes in the reasonable and supportable forecast and other factors then prevailing may result in material changes in the amount of the ACL and credit loss expense in those future periods. 131 T able of Contents Expected credit losses are estimated on a collective basis for groups of loans that share similar risk characteristics.
Re-evaluation of the ACL estimate in future periods, in light of changes in composition and characteristics of the loan portfolio, changes in the reasonable and supportable forecast and other factors then prevailing may result in material changes in the amount of the ACL and credit loss expense in those future periods. 138 Table of Contents Expected credit losses are estimated on a collective basis for groups of loans that share similar risk characteristics.
The emphasis of this discussion will be on changes in the year ended December 31, 2023 with respect to 2022.
The emphasis of this discussion will be on changes in the year ended December 31, 2024 with respect to 2023 .
The Company’s loans by credit quality indicators at December 31, 2023, 2022 and 2021 are summarized in the following table.
The Company’s loans by credit quality indicators at December 31, 2024, 2023 and 2022 are summarized in the following table.
Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum CET1, Tier 1 leverage, Tier 1 risk-based capital and total risk-based capital ratios. 125 T able of Contents The Basel III rules became effective for the Company and the Bank on January 1, 2015 with full compliance with all of the requirements being phased in by January 1, 2019.
Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum CET1, Tier 1 leverage, Tier 1 risk-based capital and total risk-based capital ratios. 132 Table of Contents The Basel III rules became effective for the Company and the Bank on January 1, 2015 with full compliance with all of the requirements being phased in by January 1, 2019.
(4) Primarily loans belonging to industrial sectors not included in the above sectors, which do not individually represent more than 1 percent of the total loan portfolio, and consumer loans which represented approximately 20.6%, 28.6% and 17.2% of the total in 2023, 2022 and 2021, respectively.
(4) Primarily loans belonging to industrial sectors not included in the above sectors, which do not individually represent more than 1 percent of the total loan portfolio, and consumer loans which represented approximately 23.2%, 20.6% and 28.6% of the total in 2024, 2023 and 2022, respectively.
Contractual maturities of investment securities are adjusted for anticipated prepayments of amortizing U.S. government sponsored agency debt and enterprise debt securities, which shorten the average lives of these investments. Goodwill. Goodwill was $19.2 million and $19.5 million as of December 31, 2023 and 2022, respectively.
Contractual maturities of investment securities are adjusted for anticipated prepayments of amortizing U.S. government sponsored agency debt and enterprise debt securities, which shorten the average lives of these investments. Goodwill. Goodwill was $19.2 million as of December 31, 2024 and 2023.
Cards and trade finance servicing fees increased $0.8 million, or 34.8%, in 2023 compared to 2022, mainly driven by higher debit cards interchange fee income. Deposits and service fees increased $0.8 million, or 4.2%, in 2023 compared to 2022, mainly driven by higher service charge fee income and higher wire transfer fees.
Cards and trade finance servicing fees increased $2.4 million, or 79.8%, in 2024 compared to 2023, mainly driven by higher debit cards interchange fee income. Deposits and service fees increased $0.8 million, or 4.0%, in 2024 compared to 2023, mainly driven by higher service charge fee income and higher wire transfer fees.
See “-Capital Resources and Liquidity Management” for more details on changes in FHLB advances in 2023 and the stock repurchase programs. 90 Table of Contents Loans Loans are our largest component of interest-earning assets.
See “-Capital Resources and Liquidity Management” for more details on changes in FHLB advances in 2024 and the stock repurchase programs. 98 Table of Contents Loans Loans are our largest component of interest-earning assets.
(2) Remained current and in accrual status as of December 31, 2023. 99 Table of Contents Foreign Outstanding The table below summarizes the composition of our international loan portfolio by country of risk for the periods presented.
(2) Remained current and in accrual status as of December 31, 2024. 107 Table of Contents Foreign Outstanding The table below summarizes the composition of our international loan portfolio by country of risk for the periods presented.
The Company is currently committed to making future contributions to the Fund for a total of $7.5 million at December 31, 2023. 129 T able of Contents Critical Accounting Policies and Estimates The preparation of our consolidated financial statements in accordance with GAAP requires us to make estimates and judgments that affect our reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities.
The Company is currently committed to making future contributions to the Fund for a total of $7.5 million at December 31, 2024. 136 Table of Contents Critical Accounting Policies and Estimates The preparation of our consolidated financial statements in accordance with GAAP requires us to make estimates and judgments that affect our reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities.
For more information on the activity of Classified loans in 2023, please refer to non-performing assets discussions above. All nonaccrual loans are classified as Substandard. 107 Table of Contents Classified Loans . Classified loans includes substandard and doubtful loans.
For more information on the activity of Classified loans in 2024, please refer to non-performing assets discussions above. All nonaccrual loans are classified as Substandard. 115 Table of Contents Classified Loans . Classified loans includes substandard and doubtful loans.
In the three months ended September 30, 2023, the Company purchased an investment in an open-end fund incorporated in the U.S with an original cost of $2.5 million. The Fund's objective is to provide a high level of current income consistent with the preservation of capital and investments deemed to be qualified under the Community Reinvestment Act.
Also in 2023, the Company purchased an investment in an open-end fund incorporated in the U.S with an original cost of $2.5 million. The Fund's objective is to provide a high level of current income consistent with the preservation of capital and investments deemed to be qualified under the Community Reinvestment Act.
See more details on the stock repurchase program launched in the first quarter of 2023 further below. 120 T able of Contents Non-controlling Interest The Company records net loss attributable to Non-controlling interests in its condensed consolidated statement of operations and comprehensive income (loss) equal to the percentage of the economic or ownership interest retained in the interest of Amerant Mortgage, and presents non-controlling interests as a component of stockholders’ equity on the consolidated balance sheets.
See more details on the stock repurchase program launched in 2023 further below. 129 Table of Contents Non-controlling Interest The Company records net loss attributable to Non-controlling interests in its condensed consolidated statement of operations and comprehensive income (loss) equal to the percentage of the economic or ownership interest retained in the interest of Amerant Mortgage, and presents non-controlling interests as a component of stockholders’ equity on the consolidated balance sheets.
This was mainly driven by an increase in commercial and industrial loan commitments. The Company uses interest rate swaps and other derivative instruments as part of its normal business operations.
This was mainly driven by an increase in commercial real estate and construction loan commitments. The Company uses interest rate swaps and other derivative instruments as part of its normal business operations.
Securities are returned to accrual status only when collection of interest is reasonably assured. 130 T able of Contents Fair Value of Financial Instruments. We are, under applicable accounting guidance, required to maximize the use of observable inputs and minimize the use of unobservable inputs in measuring fair value.
Securities are returned to accrual status only when collection of interest is reasonably assured. 137 Table of Contents Fair Value of Financial Instruments. We are, under applicable accounting guidance, required to maximize the use of observable inputs and minimize the use of unobservable inputs in measuring fair value.
Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our past performance and prospects for future performance, especially in light of the additional costs we have incurred in connection with the Company’s restructuring activities that began in 2018 and continued in 2023, including the effect of non-routine items such as the sale of loans and securities and other repossessed assets, Ban Owned life insurance restructure the valuation of securities, derivatives, loans held for sale and other real estate owned and repossessed assets, impairment of investments, the early repayment of FHLB advances, and other non-routine actions intended to improve customer service and operating performance.
Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our past performance and prospects for future performance, especially in light of the additional costs we have incurred in connection with the Company’s restructuring activities that began in 2018 and continued in 2024, and including the effect of non-core banking activities such as the sale of loans and securities (including the Securities Repositioning in 2024) and other repossessed assets, the valuation of securities, derivatives, loans held for sale and other real estate owned and repossessed assets, the early repayment of FHLB advances, impairment of investments, Bank-owned life insurance restructure, and other non-routine actions intended to improve customer service and operating performance, as well as certain non-routine items recorded in 2024 in connection with the Houston Sale Transaction.
(2) Contract termination and related costs associated with third party vendors resulting from the Company’s engagement of FIS. (3) In 2023, includes an aggregate of $6.4 million of nonrecurrent expenses in connection with the engagement of FIS and, to a lesser extent, software expenses related to legacy applications running in parallel to new core banking applications.
(6) Contract termination and related costs associated with third party vendors resulting from the Company’s engagement of FIS. 94 Table of Contents (7) In 2023, includes an aggregate of $6.4 million of nonrecurrent expenses in connection with the engagement of FIS and, to a lesser extent, software expenses related to legacy applications running in parallel to new core banking applications.
In addition, at December 31, 2023 and 2022, there were $26.2 million and $62.4 million, respectively, in loans held for sale carried at fair value in connection with the Company’s mortgage banking activities. (2) In 2022, the Company adopted a new accounting standard on estimating expected credit losses, or CECL.
At December 31, 2024 and 2023, there were $42.9 million and $26.2 million, respectively, in loans held for sale carried at fair value in connection with the Company’s mortgage banking activities. (2) In 2022, the Company adopted a new accounting standard on estimating expected credit losses, or CECL.
As of December 31, 2021 and 2020, these balances were revised to exclude the Specialty industry segment which is now disclosed separately. (2) Includes marinas, nursing and residential care facilities, and other specialty type CRE properties. There were no loans in the Specialty industry segment as of December 31, 2019.
As of December 31, 2021 and 2020, these balances were revised to exclude the Specialty industry segment which is now disclosed separately. (2) Includes marinas, nursing and residential care facilities, and other specialty type CRE properties.
This transaction is expected to increase income from this source prospectively. Interchange fees, other fees and revenue sharing are recognized when earned. Trade finance servicing fees, which primarily include commissions on letters of credit, are generally recognized over the service period on a straight line basis. Card servicing fees include credit and debit card interchange fees and other fees.
This transaction is expected to increase income from this source beginning in 2024. Interchange fees, other fees and revenue sharing are recognized when earned. Trade finance servicing fees, which primarily include commissions on letters of credit, are generally recognized over the service period on a straight line basis.
As of December 31, 2023, Amerant Mortgage had 67 FTEs compared to 68 FTEs at December 31, 2022. 72 Table of Contents Average Balance Sheet, Interest and Yield/Rate Analysis The following tables present average balance sheet information, interest income, interest expense and the corresponding average yields earned and rates paid for the years ended December 31, 2023, 2022 and 2021.
As of December 31, 2024, Amerant Mortgage had 80 FTEs compared to 67 FTEs at December 31, 2023. 79 Table of Contents Average Balance Sheet, Interest and Yield/Rate Analysis The following tables present average balance sheet information, interest income, interest expense and the corresponding average yields earned and rates paid for the years ended December 31, 2024, 2023 and 2022.
As of December 31, 2023, the Company had $378.0 million of loans held for sale in the construction and real estate economic sector and $13.4 million of loans held for sale in other sectors. At December 31, 2021, the Company had $158.1 million of loans held for sale in the construction and real estate economic sector.
At December 31, 2023, the Company had $378.0 million of loans held for sale in the construction and real estate economic sector and $13.4 million of loans held for sale in other sectors.
The tax equivalent yield for these nontaxable securities was 4.83%, 3.00% and 1.76% for the years ended December 31, 2023, 2022 and 2021, respectively. In 2023, 2022 and 2021, the tax equivalent yield was calculated by assuming a 21% tax rate and dividing the actual yield by 0.79.
The tax equivalent yield for these nontaxable securities was 4.45%, 4.83% and 3.00% for the years ended December 31, 2024, 2023 and 2022, respectively. In 2024, 2023 and 2022, the tax equivalent yield was calculated by assuming a 21% tax rate and dividing the actual yield by 0.79.
At December 31, 2023 and December 31, 2022, loans under syndication facilities held for investment include Shared National Credit facilities of $86.7 million and $143 million, respectively. 95 Table of Contents The following is a brief description of the composition of our loan classes: Commercial Real Estate (CRE) loans. We provide a mix of variable and fixed rate CRE loans.
At December 31, 2024 and December 31, 2023, loans under syndication facilities held for investment include Shared National Credit facilities of $81.5 million and $86.7 million, respectively. 103 Table of Contents The following is a brief description of the composition of our loan classes: Commercial Real Estate (CRE) loans. We provide a mix of variable and fixed rate CRE loans.
These actions include, but are not limited to reductions in workforce, streamlining operational processes, promoting the Amerant brand, decommissioning of legacy technologies, enhanced sales tools and training, expanded product offerings and improved customer analytics to identify opportunities.
These actions include, but are not limited to reductions in workforce, streamlining operational processes, promoting the Amerant brand, decommissioning of legacy technologies, enhanced sales tools and training, expanded product offerings and improved customer analytics to identify opportunities. There were no restructuring expenses in 2024.
In 2023, OREO and repossessed assets expense is presented separately in the Company’s consolidated statement of operations and comprehensive income (loss). In 2022, while OREO valuation expense was presented separately, all other OREO-related expenses were presented as part of other operating expenses in the Company’s consolidated statement of operations and comprehensive (loss) income.
In 2022, while OREO valuation expense was presented separately, all other OREO-related expenses were presented as part of other operating expenses in the Company’s consolidated statement of operations and comprehensive (loss) income. We had no other repossessed assets in 2022.
The average balance of the allowance for credit losses was $90.0 million, $57.5 million and $101.1 million in the years ended December 31, 2023, 2022 and 2021, respectively.
The average balance of the allowance for credit losses was $90.0 million, $90.0 million and $57.5 million in the years ended December 31, 2024, 2023 and 2022, respectively.
(3) In 2023, the Company transferred approximately $98.9 million, respectively, in single-family residential loans held for sale to the loans held for investment category. (4) Mortgage loans held for sale in connection with Amerant Mortgage’s ongoing business.
(2) In 2024 and 2023, the Company transferred approximately $7.7 million and $98.9 million, respectively, in single-family residential loans held for sale to the loans held for investment category. (3) Mortgage loans held for sale in connection with Amerant Mortgage’s ongoing business.
(5) Includes nontaxable securities with average balances of $49.8 million, $43.6 million and $50.2 million for the years ended December 31, 2023, 2022 and 2021, respectively. The tax equivalent yield for these nontaxable securities was 4.22%, 3.46% and 2.58% for the years ended December 31, 2023, 2022 and 2021, respectively.
(5) Includes nontaxable securities with average balances of $35.2 million, $49.8 million and $43.6 million for the years ended December 31, 2024, 2023 and 2022, respectively. The tax equivalent yield for these nontaxable securities was 4.29%, 4.22% and 3.46% for the years ended December 31, 2024, 2023 and 2022, respectively.
In addition, at December 31, 2023 and December 31, 2022, the Company’s cash and cash equivalents included restricted cash of $25.8 million and $42.2 million, respectively, which were held primarily to cover margin calls on derivative transactions with certain brokers.
In addition, at December 31, 2024 and December 31, 2023, the Company’s cash and cash equivalents included restricted cash of $24.4 million and $25.8 million, respectively, which were held primarily to cover margin calls on derivative transactions with certain brokers.
(2) Comprised mostly of CRE loans throughout South Florida, the greater Houston, Texas area, and New York. (3) Gasoline stations represented approximately 57%, 57% and 59% of the retail trade sector at year-end 2023, 2022 and 2021, respectively.
(2) Comprised mostly of CRE loans throughout South and Central Florida, Tampa, the greater Houston, Texas area, and New York. (3) Gasoline stations represented approximately 37%, 57% and 57% of the retail trade sector at year-end 2024, 2023 and 2022, respectively.
(2) In 2023, includes $0.3 million in connection with the closure of a branch in Houston, Texas as well as an aggregate of $1.1 million related to ROU asset impairments in connection with the closure of two branches in 2023 (one branch in Miami, Florida and another branch in Houston, Texas).
In 2023, includes a rent termination fee of $0.3 million in connection with the closure of a branch in Houston, Texas, as well as an aggregate of $1.1 million related to ROU asset impairments in connection with the closure of two branches in 2023 (one branch in Miami, FL and another branch in Houston, Texas).
See Note 14 to our audited consolidated financial statements in this Form 10-K for details on the dilutive effects of the issuance of restricted stock, restricted stock units and performance share units on earnings per share in 2023, 2022 and 2021.
See Note 23 to our audited annual consolidated financial statements in this Form 10-K for details on the dilutive and anti-dilutive effects of the issuance of restricted stock, restricted stock units and performance stock units on earnings per share in 2024, 2023 and 2022.
(5) In 2023, includes expenses of $0.5 million ROU impairment in connection with the closure of a branch in Houston, Texas and $0.9 million of accelerated amortization of leasehold improvements and $0.6 million of right-of-use or “ROU” asset impairment associated with the closure of a branch in Miami, Florida.
In addition, in 2023, includes $0.9 million of accelerated amortization of leasehold improvements and $0.6 million of right-of-use or “ROU” asset impairment associated with the closure of a branch in Miami, FL. Also in 2023, includes $0.5 million of ROU asset impairment associated with the closure of a branch in Houston, Texas in 2023.
The average balance of total loans held for sale was $77.8 million, $117.6 million and $72.7 million in the years ended December 31, 2023, 2022 and 2021, respectively. 74 Table of Contents (2) Includes average non-performing loans of $34.3 million, $30.7 million and $90.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.
The average balance of total loans held for sale was $353.9 million, $77.8 million and $117.6 million in the years ended December 31, 2024, 2023 and 2022, respectively. 81 Table of Contents (2) Includes average non-performing loans of $74.9 million, $34.3 million and $30.7 million for the years ended December 31, 2024, 2023 and 2022, respectively.
These loans include loans to domestic and foreign individuals primarily secured by their personal residence in the U.S., including first mortgages on properties mainly located in Florida, home equity and home improvement loans, mainly in South Florida and the greater Houston, Texas markets. These loans have terms common in the industry.
These loans include loans to domestic and foreign individuals and businesses primarily secured by single-family residences in the U.S., including first mortgages on properties mainly located in Florida, home equity and home improvement loans, mainly in South Florida and the greater Houston, Texas markets. These loans have terms common in the industry.
(6) Includes investments in FHLB and Federal Reserve Bank stock. Amounts correspond to original cost at the date presented. Original cost approximates fair value because of the nature of these investments. As of December 31, 2023, total securities increased $130.3 million, or 9.5%, to $1.5 billion compared to $1.4 billion as of December 31, 2022.
(6) Includes investments in FHLB and Federal Reserve Bank stock. Amounts correspond to original cost at the date presented. Original cost approximates fair value because of the nature of these investments. As of December 31, 2024, total securities slightly increased $1.0 million, or 0.1%, to $1.5 billion compared to $1.5 billion as of December 31, 2023.
(8) International customers’ overdraft balances were de minimis at each of the dates presented. 92 Table of Contents The composition of our CRE loan portfolio held for investment by industry segment at December 31, 2023, 2022 and 2021 is depicted in the following table: December 31, (in thousands) 2023 2022 2021 2020 2019 Retail (1) $ 728,349 $ 731,229 $ 751,202 $ 1,062,119 $ 1,143,565 Multifamily 407,214 820,023 514,679 737,696 801,626 Office space 347,649 342,248 361,921 390,295 453,328 Specialty (2) 152,277 84,791 86,130 35,210 — Land and construction 300,378 273,174 327,246 349,800 278,688 Hospitality 282,085 324,881 241,336 191,750 198,807 Industrial and warehouse 105,840 132,567 100,001 70,465 96,102 Total CRE Loans Held For Investment (3) $ 2,323,792 $ 2,708,913 $ 2,382,515 $ 2,837,335 $ 2,972,116 _______________ (1) Includes loans generally granted to finance the acquisition or operation of non-owner occupied properties such as retail shopping centers, free-standing single-tenant properties, and mixed-use properties primarily dedicated to retail, where the primary source of repayment is derived from the rental income generated from the use of the property by its tenants.
(6) International customers’ overdraft balances were de minimis at each of the dates presented. 100 Table of Contents The composition of our CRE loan portfolio held for investment by industry segment at December 31, 2024, 2023 and 2022, 2021 and 2020 is depicted in the following table: December 31, (in thousands) 2024 2023 2022 2021 2020 Retail (1) $ 718,869 $ 728,349 $ 731,229 $ 751,202 $ 1,062,119 Multifamily 336,229 407,214 820,023 514,679 737,696 Office space 446,747 347,649 342,248 361,921 390,295 Specialty (2) 145,290 152,277 84,791 86,130 35,210 Land and construction 483,210 300,378 273,174 327,246 349,800 Hospitality 288,788 282,085 324,881 241,336 191,750 Industrial and warehouse 78,779 105,840 132,567 100,001 70,465 Total CRE Loans Held For Investment (3) $ 2,497,912 $ 2,323,792 $ 2,708,913 $ 2,382,515 $ 2,837,335 _______________ (1) Includes loans generally granted to finance the acquisition or operation of non-owner occupied properties such as retail shopping centers, free-standing single-tenant properties, and mixed-use properties primarily dedicated to retail, where the primary source of repayment is derived from the rental income generated from the use of the property by its tenants.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeDecember 31, 2023 (in thousands except percentages) Total Less than one year One to three years Four to Five Years More than five years Non-rate Earning Assets Cash and cash equivalents $ 321,872 $ 246,883 $ — $ — $ — $ 74,989 Securities: Debt available for sale 1,217,502 268,654 319,225 170,532 459,091 — Debt held to maturity 226,645 — — — 226,645 — Marketable equity securities 2,534 2,534 — — — — Federal Reserve and FHLB stock 50,294 37,014 — — — 13,280 Loans held for sale 391,419 391,419 — — — — Loans held for investment - performing (1) 6,839,093 4,234,340 1,209,433 636,291 759,028 — Earning Assets $ 9,049,359 $ 5,180,845 $ 1,528,658 $ 806,823 $ 1,444,764 $ 88,269 Liabilities Interest bearing demand deposits 2,560,629 2,560,629 — — — — Saving and money market 1,610,218 1,610,218 — — — — Time deposits 2,297,097 1,509,891 671,752 114,543 912 — FHLB advances (2) 645,000 635,000 10,000 — — — Senior Notes 59,526 — 59,526 — — — Subordinated Notes 29,454 — — — 29,454 — Junior subordinated debentures 64,178 64,178 — — — — Interest bearing liabilities $ 7,266,102 $ 6,379,916 $ 741,278 $ 114,543 $ 30,366 $ — Interest rate sensitivity gap (1,199,071) 787,380 692,280 1,414,398 88,269 Cumulative interest rate sensitivity gap (1,199,071) (411,691) 280,589 1,694,987 1,783,256 Earnings assets to interest bearing liabilities (%) 81.2 % 206.2 % 704.4 % 4,757.8 % N/M __________________ (1) “Loans held for investment - performing” excludes $34.4 million of non-performing loans (non-accrual loans and loans 90 days or more past-due and still accruing).
Biggest changeDecember 31, 2024 (in thousands except percentages) Total Less than one year One to three years Four to Five Years More than five years Non-rate Earning Assets Cash and cash equivalents $ 590,359 $ 520,863 $ — $ — $ — $ 69,496 Securities: Debt available for sale 1,437,170 344,207 215,748 181,064 696,151 — Debt held to maturity — — — — — — Marketable equity securities 2,477 2,477 — — — — Federal Reserve and FHLB stock 58,278 42,285 — — — 15,993 Loans held for sale 42,911 42,911 — — — — Loans held for investment - performing (1) 7,124,310 4,700,832 1,081,723 591,335 750,420 — Earning Assets $ 9,255,505 $ 5,653,575 $ 1,297,471 $ 772,399 $ 1,446,571 $ 85,489 Liabilities Interest bearing demand deposits 2,229,467 2,229,467 — — — — Saving and money market 1,885,928 1,885,928 — — — — Time deposits 2,234,445 1,769,554 378,096 86,159 636 — FHLB advances (2) 745,000 30,000 210,000 505,000 — — Senior Notes 59,843 59,843 — — — — Subordinated Notes 29,624 — — — 29,624 — Junior subordinated debentures 64,178 64,178 — — — — Interest bearing liabilities $ 7,248,485 $ 6,038,970 $ 588,096 $ 591,159 $ 30,260 $ — Interest rate sensitivity gap (385,395) 709,375 181,240 1,416,311 85,489 Cumulative interest rate sensitivity gap (385,395) 323,980 505,220 1,921,531 2,007,020 Earnings assets to interest bearing liabilities (%) 93.6 % 220.6 % 130.7 % 4,780.5 % N/M __________________ (1) “Loans held for investment - performing” excludes $104.1 million of non-performing loans (non-accrual loans and loans 90 days or more past-due and still accruing).
They include three types of analyses consistent with industry practices: • earnings sensitivity; • economic value of equity, or EVE; and • investment portfolio mark-to-market exposure (debt and equity securities available for sale and held to maturity securities). 135 T able of Contents The Company continues to be asset sensitive, therefore income is expected to increase when interest rates move higher, and to decrease when interest rates move lower.
They include three types of analyses consistent with industry practices: • earnings sensitivity; • economic value of equity, or EVE; and • investment portfolio mark-to-market exposure (debt and equity securities available for sale and held to maturity securities). 142 Table of Contents The Company continues to be asset sensitive, therefore income is expected to increase when interest rates move higher, and to decrease when interest rates move lower.
The improvements in the sensitivity of EVE from changes in interest rates as of December 31, 2023 for the 200 and 100 basis point increase buckets are principally attributed to the balance sheet becoming more asset sensitive compared to December 31, 2022.
The increase in sensitivity of EVE from changes in interest rates as of December 31, 2024 for the 200 and 100 basis point increase buckets are principally attributed to the changes in the composition of the balance sheet becoming more asset sensitive compared to December 31, 2023.
During the periods reported, the modeled effects on the EVE remained within established Company risk limits. 137 T able of Contents Available for Sale Portfolio mark-to-market exposure The Company measures the potential change in the market price of its investment portfolio, and the resulting potential change on its equity for different interest rate scenarios.
During the periods reported, the modeled effects on the EVE remained within established Company risk limits. 144 Table of Contents Available for Sale Portfolio mark-to-market exposure The Company measures the potential change in the market price of its investment portfolio, and the resulting potential change on its equity for different interest rate scenarios.
These limits are reviewed annually or more frequently as believed appropriate, based on various factors, including capital levels and earnings. 138 T able of Contents The following table sets forth information regarding our interest rate sensitivity due to the maturities of our interest bearing assets and liabilities as of December 31, 2023.
These limits are reviewed annually or more frequently as believed appropriate, based on various factors, including capital levels and earnings. The following table sets forth information regarding our interest rate sensitivity due to the maturities of our interest bearing assets and liabilities as of December 31, 2024.
(2) Includes FHLB advances in the amount of $595.0 million set to mature in 2027 or later, which come with quarterly callable features. N/M Not meaningful. 139
(2) Includes FHLB advances in the amount of $435.0 million set to mature in 2027 or later, which come with quarterly callable features. N/M Not meaningful. 146
The following table shows the sensitivity of our EVE as a function of interest rate changes as of the periods presented: Change in equity (1) December 31, 2023 2022 Change in Interest Rates (Basis points) Increase of 200 (4.66) % (7.97) % Increase of 100 (0.38) % (3.06) % Decrease of 50 3.61 % 3.08 % Decrease of 100 1.83 % 4.11 % Decrease of 200 2.73 % 4.95 % __________________ (1) Represents the percentage of equity change in a static balance sheet analysis assuming interest rate shocks are instant and parallel to the yield curves for the various interest rates and indices that affect our net interest income.
The following table shows the sensitivity of our EVE as a function of interest rate changes as of the periods presented: Change in equity (1) December 31, 2024 2023 Change in Interest Rates (Basis points) Increase of 200 (13.61) % (4.66) % Increase of 100 (4.86) % (0.38) % Decrease of 50 2.24 % 3.61 % Decrease of 100 3.82 % 1.83 % Decrease of 200 4.50 % 2.73 % __________________ (1) Represents the percentage of equity change in a static balance sheet analysis assuming interest rate shocks are instant and parallel to the yield curves for the various interest rates and indices that affect our net interest income.
The base scenario assumes (i) flat interest rates over the next 12 months, (ii) that total financial instrument balances are kept constant over time and (iii) that interest rate shocks are instant and parallel to the yield curve, for the various interest rates and indices that affect our net interest income. 136 T able of Contents Net interest income in the base scenario, decreased to approximately $336.0 million in December 31, 2023 compared to $349.0 million in December 31, 2022.
The base scenario assumes (i) flat interest rates over the next 12 months, (ii) that total financial instrument balances are kept constant over time and (iii) that interest rate shocks are instant and parallel to the yield curve, for the various interest rates and indices that affect our net interest income. 143 Table of Contents Net interest income in the base scenario, increased to approximately $361.0 million in December 31, 2024 compared to $336.0 million in December 31, 2023.
Notwithstanding that our model includes the available for sale securities portfolio, and its projected effect on AOCI or AOCL (a component of shareholders’ equity), we made an irrevocable election in 2015 to exclude the effects of AOCI or AOCL in the calculation of our regulatory capital ratios, in connection with the adoption of Basel III capital rules in the U.S.
Notwithstanding that our model includes the available for sale securities portfolio, and its projected effect on AOCI or AOCL (a component of shareholders’ equity), we made an irrevocable election in 2015 to exclude the effects of AOCI or AOCL in the calculation of our regulatory capital ratios, in connection with the adoption of Basel III capital rules in the U.S 145 Table of Contents Limits Approval Process The ALCO is responsible for the management of market risk exposures and meets monthly.
The average duration of our investment portfolio slightly increased to 5.0 years at December 31, 2023 compared to 4.9 years at December 31, 2022. The slight increase in duration was mainly due to lower mortgage-backed securities prepayments. Additionally, the floating rate portfolio slightly increased to 13.3% at December 31, 2023 from 13.2% at December 31, 2022.
The average duration of our investment portfolio slightly increased to 5.2 years at December 31, 2024 compared to 5.0 years at December 31, 2023. The slight increase in duration was mainly due to lower mortgage-backed securities prepayments.
This table shows the result of this test as of December 31, 2023 and 2022: Change in market value (1) December 31, (in thousands) 2023 2022 Change in Interest Rates (Basis points) Increase of 200 $ (112,010) $ (116,288) Increase of 100 (54,182) (59,755) Decrease of 50 34,956 30,527 Decrease of 100 55,312 60,578 Decrease of 200 112,809 115,225 __________________ (1) Represents the amounts by which the investment portfolio mark-to-market would change assuming rate shocks that are instant and parallel to the yield curves for the various interest rates and indices that affect our net interest income.
This table shows the result of this test as of December 31, 2024 and 2023: Change in market value (1) December 31, (in thousands) 2024 2023 Change in Interest Rates (Basis points) Increase of 200 $ (150,674) $ (112,010) Increase of 100 (72,777) (54,182) Decrease of 50 34,716 34,956 Decrease of 100 68,177 55,312 Decrease of 200 122,109 112,809 __________________ (1) Represents the amounts by which the investment portfolio mark-to-market would change assuming rate shocks that are instant and parallel to the yield curves for the various interest rates and indices that affect our net interest income.
The following table shows the sensitivity of our net interest income as a function of modeled interest rate changes: Change in earnings (1) December 31, (in thousands, except percentages) 2023 2022 Change in Interest Rates (Basis points) Increase of 200 $ 20,487 6.1 % $ 27,580 7.9 % Increase of 100 15,618 4.7 % 18,320 5.3 % Decrease of 50 (3,923) (1.2) % (5,683) (1.6) % Decrease of 100 (10,273) (3.1) % (11,548) (3.3) % Decrease of 200 (21,290) (6.3) % (34,279) (9.8) % __________________ (1) Represents the change in net interest income, and the percentage that change represents of the base scenario net interest income.
The following table shows the sensitivity of our net interest income as a function of modeled interest rate changes: Change in earnings (1) December 31, (in thousands, except percentages) 2024 2023 Change in Interest Rates (Basis points) Increase of 200 $ 24,427 6.8 % $ 20,487 6.1 % Increase of 100 19,262 5.3 % 15,618 4.7 % Decrease of 50 (6,931) (1.9) % (3,923) (1.2) % Decrease of 100 (13,550) (3.8) % (10,273) (3.1) % Decrease of 200 (30,120) (8.3) % (21,290) (6.3) % __________________ (1) Represents the change in net interest income, and the percentage that change represents of the base scenario net interest income.
Limits Approval Process The ALCO is responsible for the management of market risk exposures and meets monthly. The ALCO monitors all the Company’s exposures, compares them against specific limits, and takes actions to modify any exposure that the ALCO considers inappropriate based on market expectations or new business strategies, among other factors.
The ALCO monitors all the Company’s exposures, compares them against specific limits, and takes actions to modify any exposure that the ALCO considers inappropriate based on market expectations or new business strategies, among other factors. The ALCO reviews and recommends market risk limits to our Board of Directors.
These decreases were partially offset by: (i) higher floating loan rates on existing loans due to increase in market rates repricing higher throughout 2023 and (ii) the growth in the size of the balance sheet as total assets increased $588.5 million or 6.4% in 2023 compared to 2022.
This increase is mainly due to: (i) higher interest income of the investment portfolio as a result of the investment portfolio repositioning; (ii) the growth in the size of the balance sheet as total assets increased $185.4 million or 1.9% in 2024 compared to 2023; and (iii) reduction of high cost interest-bearing deposits.
Removed
This decrease is mainly due to: higher cost of total deposits and borrowings.
Removed
The ALCO reviews and recommends market risk limits to our Board of Directors.

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