SVB Financial Group (NASDAQ:SIVB) reported first-quarter earnings that exceeded expectations throughout the business. The holding company for Silicon Valley Bank, which specializes in providing banking services to entrepreneurs and private equity firms, beat estimates on both the top and bottom lines. As of 10:30 a.m. EDT on Friday, the stock was up by nearly 18%.
Earnings of $3.63 per share handily eclipsed estimates of $3.13, and not only did revenue of $575.5 million come in about $40 million above estimates, but this represented an impressive 34.5% annual growth.
It's not just the top- and bottom-line results that were strong. Looking past the top-line numbers, SVB Financial's results look quite impressive. Just to give you a rundown of some of the highlights:
- The bank's loan portfolio grew by 20% year over year and increased by more than 6% in the first quarter alone.
- Deposits grew by 15.4% from a year ago.
- Client investment funds climbed by a staggering 46%, from $46.4 billion in the first quarter of 2017 to $67.7 billion now.
- Assets rose from $45.3 billion a year ago to $52.4 billion currently.
- Return on assets (ROA) was 1.51% for the quarter and return on equity (ROE) was 18.1%. Both were tremendous improvements over 0.91% and 11%, respectively, a year ago.
- The bank's 46.1% efficiency ratio is down from 55.6% last year and is one of the best efficiency ratios we've seen so far in earnings season.
- Net interest margin increased by 18 basis points to 3.38% over the past year.
- Book value per share jumped 16.2% to $83.43.
These results are about as good as shareholders could have hoped for, and explain the stock's big upward move. What's more, it follows SVB Financial's already-impressive performance, and the bank is now up 57% over the past year. It remains to be seen whether this incredible growth story will continue, but there's no question that SVB Financial is doing an excellent job.