WILMINGTON, NC - Live Oak Bancshares (NYSE: NYSE:LOB), the parent company of Live Oak Bank, has announced the appointment of Michael J. Cairns as its new Chief Credit Officer (CCO), effective August 1, 2024. Cairns, who has been with the company since 2015, will take over the role from Steven J. Smits, who has served as CCO for nine years.
Smits will transition to a new position as head of commercial banking, a move that is seen as leveraging his extensive experience to further grow the bank's conventional banking business. During his tenure as CRO, Smits is credited with significantly contributing to the bank’s strong credit culture.
Cairns brings a wealth of experience to his new role, having previously served as Head of Credit at Live Oak. His background in commercial banking includes a focus on commercial and industrial (C&I), commercial real estate (CRE), and asset-based lending (ABL).
Before joining Live Oak, Cairns held various lending and credit positions at TCF National Bank and Talmer Bank & Trust in Michigan. He holds a Bachelor of Business Administration in finance and a Master of Science in finance from Walsh College.
Chairman and CEO James S. (Chip) Mahan II expressed confidence in Cairns’ ability to uphold the bank’s credit legacy, noting that his years of experience working closely with Smits make him an ideal successor.
Live Oak Bancshares is recognized for partnering with businesses that prioritize service and technology innovation in the banking sector. The company's Small Business Banking group will continue to focus on small business financing under the leadership of Mike McGinley.
This leadership change comes at a time when Live Oak Bancshares is looking to expand and strengthen its commercial banking division. The information on this appointment is based on a press release statement.
In other recent news, Live Oak Bancshares reported Q1 results, revealing a decrease in loan originations to $805 million but a promising 23% year-over-year increase in the loan pipeline. The company's earnings per share (EPS) was $0.36, and a net interest margin of 3.33% was recorded.
Deposits saw a 10% growth to $10.5 billion, primarily driven by business deposits. The company also highlighted its ongoing investment in technology to improve customer experience and automate loan processes.
Live Oak Bancshares has built specific reserves for borrowers affected by higher rates and is anticipating stronger activity in the Small Business Administration (SBA) and specialty finance sectors in the upcoming second quarter. Despite a decrease in loan originations, the company projects high-single-digit growth for 2024, with potential low-single-digit growth if more revenue generators are hired.
The company also plans to increase sales to small business customers in the latter half of the year, focusing on growth in business deposits and conventional lending, particularly in niche markets. These recent developments indicate Live Oak Bancshares' strategic approach towards growth and its commitment to enhancing its services.
InvestingPro Insights
As Live Oak Bancshares (NYSE: LOB) welcomes Michael J. Cairns as the new Chief Credit Officer, the company's financial health and strategic outlook remain critical for stakeholders. In light of this leadership transition, recent data from InvestingPro offers a snapshot of the company's performance and market sentiment.
InvestingPro data highlights a Price to Earnings (P/E) ratio of 15.1, which may suggest a reasonable valuation relative to earnings in the last twelve months as of Q1 2024. This is coupled with a Price to Book (P/B) ratio of 1.63, offering insight into how the market values the company's net assets. Furthermore, Live Oak Bancshares reported a solid Operating Income Margin of 28.46%, indicating efficient management and profitability in its operations.
Still, the company has experienced some challenges, as reflected in the 27.2% decline in the stock price over the last six months. This volatility is in line with one of the InvestingPro Tips, which notes that the stock price movements are quite volatile.
Another InvestingPro Tip indicates that the company has maintained dividend payments for 10 consecutive years, showing a commitment to returning value to shareholders even amidst market fluctuations.
For readers seeking a deeper analysis, InvestingPro offers additional insights, including PRONEWS24 for an extra 10% off a yearly or biyearly Pro and Pro+ subscription. With 9 additional InvestingPro Tips available, investors can gain a more comprehensive understanding of Live Oak Bancshares' financial health and future prospects.
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