Stifel Reports April 2024 Operating Data

Rhea-AI Summary

Stifel Financial Corp. (NYSE: SF) reported its operating data for April 2024 on May 23, 2024. Total client assets grew by 12% year-over-year to $454 billion, and fee-based client assets increased by 15% to $171 billion. However, both metrics declined by 3% from March 2024 due to a downturn in equity markets. Client money market and insured product balances decreased by 2%, influenced by seasonal tax payments. Notably, total bank loans rose by 2% in April, driven by the fund banking business. These figures provide insights into the company's performance but should not be directly correlated with earnings.

Positive

• Total client assets increased by 12% year-over-year to $454 billion.
• Fee-based client assets rose by 15% from the previous year to $171 billion.
• Private Client Group fee-based assets grew by 14% year-over-year.
• Total bank loans increased by 2% in April, driven by fund banking growth.

Negative

• Total client assets declined by 3% from March 2024 due to equity market downturn.
• Fee-based client assets decreased by 3% compared to March 2024 levels.
• Client money market and insured product balances decreased by 2% in April.
• Total bank loans are down by 4% compared to April 2023.

Insights

Financial Analyst

Stifel Financial Corp. reported a 12% increase in total client assets and a 15% increase in fee-based assets compared to the same period a year ago, which indicates strong performance on an annual basis. However, it is important to note the 3% decline in both metrics from March 2024 levels, driven by a downturn in equity markets in April. This variability suggests that Stifel's asset growth is sensitive to market conditions, highlighting the need for investors to keep an eye on broader economic indicators that might influence equity markets.

Another key aspect is the 2% increase in total bank loans, reflecting growth in Stifel's fund banking business. This is a positive sign, indicating potential revenue growth from interest income and pointing to new lending opportunities. However, the 2% decrease in client money market and insured product balances could be seen as a minor drawback, primarily attributed to seasonal factors like tax payments. Investors should assess whether these seasonal factors could signify longer-term trends affecting liquidity.

Overall, the mixed results show strengths in asset growth and lending opportunities but also emphasize the volatility due to market conditions. Retail investors might consider how these trends align with their individual risk tolerance and investment strategies.

Market Research Analyst

The drop in equity markets and its impact on Stifel's client assets and fee-based assets underlines a common vulnerability for firms heavily reliant on market conditions. This decline is consistent with wider market trends, reflecting typical investor behavior during market downturns. The analysis of client behavior, such as the modest cash sorting, also reveals a cautious approach by clients in response to market volatility. This could indicate a potential shift towards more conservative investment strategies among Stifel's clientele.

Regarding the bank loans, the 2% increase signals strategic growth in Stifel's lending operations. Growth in the fund banking business is promising, suggesting increasing demand for capital among fund managers. Looking forward, if this demand continues, it could bolster Stifel's future profitability. However, the 4% year-over-year decline in bank loans reminds us of the broader economic challenges potentially impacting lending activities on a longer horizon.

From a market perspective, these elements are significant for investors, providing insights into how Stifel's client base reacts to economic shifts and how well the company capitalizes on lending opportunities.

ST. LOUIS, May 23, 2024 (GLOBE NEWSWIRE) -- Stifel Financial Corp. (NYSE: SF) today reported selected operating results for April 30, 2024 in an effort to provide timely information to investors on certain key performance metrics. Due to the limited nature of this data, a consistent correlation to earnings should not be assumed.

Ronald J. Kruszewski, Chairman and Chief Executive Officer, said, “Total client assets and fee-based assets increased 12% and 15%, respectively, from the same period a year ago, as a result of strong recruiting and market appreciation. However, a decline in equity markets in April was the primary driver behind a 3% decline in both metrics versus March 2024 levels. Client money market and insured product balances decreased 2% in April, driven by seasonal tax payments and modest cash sorting as both Smart Rate and Sweep balances declined during the month. As we noted in our most recent earnings call, we are beginning to see increased lending opportunities and, as such, our total bank loans increased 2% in April, fueled by growth in our fund banking business.”

Selected Operating Data (Unaudited)
	As of						% Change
(millions)	4/30/2024		4/30/2023		3/31/2024		4/30/2023			3/31/2024
Total client assets	$454,023		$406,620		$467,697		12	%		(3	)%
Fee-based client assets	$171,422		$149,604		$177,108		15	%		(3	)%
Private Client Group fee-based client assets	$150,125		$131,321		$155,144		14	%		(3	)%
Bank loans, net (includes loans held for sale)	$19,962		$20,857		$19,484		(4	)%		2	%
Client money market and insured product(1)	$26,318		$25,220		$26,902		4	%		(2	)%

(1) Includes Sweep deposits, Smart Rate deposits, Third-party Bank Sweep Program, and Other Sweep cash.

Company Information

Stifel Financial Corp. (NYSE: SF) is a financial services holding company headquartered in St. Louis, Missouri, that conducts its banking, securities, and financial services business through several wholly owned subsidiaries. Stifel’s broker-dealer clients are served in the United States through Stifel, Nicolaus & Company, Incorporated, including its Eaton Partners and Miller Buckfire business divisions; Keefe, Bruyette & Woods, Inc.; and Stifel Independent Advisors, LLC; in Canada through Stifel Nicolaus Canada Inc.; and in the United Kingdom and Europe through Stifel Nicolaus Europe Limited. The Company’s broker-dealer affiliates provide securities brokerage, investment banking, trading, investment advisory, and related financial services to individual investors, professional money managers, businesses, and municipalities. Stifel Bank and Stifel Bank & Trust offer a full range of consumer and commercial lending solutions. Stifel Trust Company, N.A. and Stifel Trust Company Delaware, N.A. offer trust and related services. To learn more about Stifel, please visit the Company’s website at www.stifel.com. For global disclosures, please visit www.stifel.com/investor-relations/press-releases.

Media Contact: Neil Shapiro (212) 271-3447 | Investor Contact: Joel Jeffrey (212) 271- 3610 | www.stifel.com/investor-relations

FAQ

What are Stifel's total client assets as of April 2024?

Stifel's total client assets were reported at $454 billion as of April 2024.

How did Stifel's fee-based client assets change in April 2024?

Fee-based client assets increased by 15% year-over-year to $171 billion but declined by 3% from March 2024.

What factors contributed to the decline in Stifel's client money market balances in April 2024?

Client money market and insured product balances decreased by 2% due to seasonal tax payments and modest cash sorting.

How did Stifel's total bank loans perform in April 2024?

Total bank loans increased by 2% in April 2024, driven by growth in the fund banking business.

What was the percentage change in Stifel's private client group fee-based assets as of April 2024?

Private client group fee-based assets increased by 14% year-over-year but decreased by 3% from March 2024.