Overview

* VersaBank ( VBNK ) Q3 revenue rises 17% yr/yr to C$31.6 mln

* Net income falls 32% yr/yr due to realignment costs

* Total assets increase 21% yr/yr to C$5.5 bln

Outlook

* Company targets US Receivable Purchase Program (RPP) portfolio of US$290 mln by fiscal year-end

* Company sees growth in Canada from resilient consumer spending

* VersaBank ( VBNK ) anticipates Digital Deposit Receipts (DDRs) as a significant future opportunity

Result Drivers

* RPP EXPANSION - Growth driven by expansion of RPP in US and Canada, including securitization

* DIGITAL BANKING GROWTH - Canadian operations benefited from resilient consumer spending and new partnerships

* REALIGNMENT COSTS - Significant non-interest expenses incurred due to planned corporate structure realignment to US bank framework

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q3 C$31.58

Revenue mln

Q3 EPS C$0.2

Q3 Net C$6.58

Income mln

Q3 Basic C$0.2

EPS

Q3 CET1 13.6%

Capital

Ratio

Q3 Net 2.2%

Interest

Margin

(%)

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

* Wall Street's median 12-month price target for Versabank ( VBNK ) is C$19.00, about 17.5% above its September 3 closing price of C$15.68

* The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 8 three months ago

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)