Customers Bancorp Inc (CUBI)CUBI

Customers Bancorp Inc.: A Comprehensive Overview

Company Profile:

Detailed History and Background

Customers Bancorp, Inc. (CUB) is a bank holding company headquartered in Wyomissing, Pennsylvania. Founded in 1927 as Farmers National Bank of Cumru Township, it has grown through acquisitions and organic expansion to become a leading community bank in Pennsylvania and eastern Pennsylvania. Customers Bancorp operates a network of 73 branches across 6 states: Pennsylvania, New Jersey, New York, Ohio, Massachusetts, and Rhode Island.

Key milestones:

• 1927: Founded as Farmers National Bank of Cumru Township.
• 1984: Changed name to Customers Bank and Trust Company and began expanding through acquisitions.
• 1992: Became a publicly traded company.
• 2009: Changed name to Customers Bancorp, Inc.
• 2014: Acquired First Priority Bank, expanding into New Jersey.
• 2022: Acquired 30 branches of First Niagara Bank from KeyBank National Association.
• 2023: Announced plan to acquire Santander Bancorp, its largest acquisition to date.

Core Business Areas

Customers Bancorp focuses on providing a variety of financial services to individuals, small businesses, and corporate clients. These services include:

• Commercial Banking: Loans, lines of credit, treasury management, and remote deposit capture.
• Retail Banking: Checking and savings accounts, CDs, mortgages, home equity loans, and credit cards.
• Wealth Management: Investment and wealth planning services.
• Insurance: Personal and commercial insurance products.

Leadership Team and Corporate Structure

The leadership team of Customers Bancorp is headed by Jay Sidhu, the Chairman, President, and CEO. He holds a Bachelor of Commerce degree from the University of Bombay and a Master of Business Administration degree from the University of Toledo. The executive leadership also includes:

• Richard Ehst: CFO
• James McQuade: COO
• David Patti: Chief Risk Officer
• Stephen Smith: Head of Commercial Banking
• Richard Straub: Head of Retail Banking

The Board of Directors consists of 13 members, with Jay Sidhu serving as Chairman.

Top Products and Market Share:

Top Products

• Commercial Loans: Customers Bancorp focuses on providing commercial loans to small and medium-sized businesses.
• Deposits: The bank offers a range of deposit products, including checking and savings accounts, CDs, and money market accounts.
• Mortgages: Customers Bancorp offers a variety of mortgage products, including fixed-rate and adjustable-rate mortgages.

Market Share

Customers Bancorp has a limited market share in the overall U.S. banking industry. However, it holds a strong position in its core markets, particularly in Pennsylvania and eastern Pennsylvania. As of December 31, 2022, it was:

• The 4th largest deposit market share in the Philadelphia-Reading-Camden MSA with 4.04%
• The 7th largest deposit market share in the Allentown-Bethlehem-Easton MSA with 3.90%
• The 10th largest deposit market share in the Scranton-Wilkes Barre metro area with 2.99%

Product Performance and Market Reception

Customers Bancorp's top products have generally performed well in the market. Its commercial loan portfolio grew by 15% in 2022, and its deposit base increased by 14%. The bank's mortgage and wealth management businesses have also experienced solid growth.

Total Addressable Market (TAM)

The U.S. banking industry is a large and fragmented market with thousands of banks and credit unions. The industry's TAM is estimated to be over $10 trillion, with retail banking representing the largest segment.

Financial Performance:

Analysis of Financial Statements

Here's a brief overview of Customers Bancorp's recent financial performance:

• Revenue: Increased by 15% in 2022 to $764.4 million.
• Net Income: Increased by 31% in 2022 to $252.4 million.
• Profit Margins: Net interest margin was stable at 3.08% in 2022, while non-interest income margin increased to 1.81%.
• Earnings per Share (EPS): Diluted EPS increased to $5.09 in 2022.

Year-over-Year Performance Comparison

Customers Bancorp has experienced strong financial performance in recent years. Revenue, net income, and EPS have all grown significantly year-over-year.

Cash Flow and Balance Sheet Health

Customers Bancorp has a healthy balance sheet with a strong capital position. The bank's cash flow from operations has been consistently positive in recent years.

Dividends and Shareholder Returns:

Dividend History