Despite high interest rates, inflation and an overall challenging national economy, Raymond James Financial reported record net revenues of $3.05 billion and net income of $432 million for the fiscal fourth quarter ended Sept. 30.
Raymond James' revenues increased 8% over the 2022's fiscal fourth quarter, "primarily driven by higher asset management and related administrative fees," as well as fees collected from third-party banks, the St. Pete-based financial company told investors on Wednesday in a news release and subsequent conference call.
The company's fiscal year also ended on Sept. 30, and Raymond James says it had record annual net revenues of $11.62 billion, a 6% increase from 2022, "despite the challenging macroeconomic environment," says Paul Reilly, Raymond James CEO and chairman.
"We enter fiscal 2024 with strong client asset levels and healthy pipelines for growth across the business," says Reilly. "However, given uncertainty around interest rates and geopolitical conditions, we remain relentlessly focused on maintaining strong capital ratios and a flexible balance sheet to support our results in any market environment."
But Raymond James' concern about the larger national economy came at the same time the U.S. economy grew at almost a 5% annual rate in the three months ending Sept. 30, according to the U.S. Commerce Department's Bureau of Economic Analysis. On Thursday, the Commerce Department put the growth rate at a solid and higher-than-expected 4.9% annualized rate for the third quarter of calendar year 2023.
"The increase in real GDP (gross domestic product) reflected increases in consumer spending, private inventory investment, exports, state and local government spending, federal government spending, and residential fixed investment," the federal bureau says.
As for Raymond James, the previous three months ending Sept. 30 saw some of that macroeconomic power fuel its business, with "record quarterly results primarily driven by higher asset management and related administrative fees, reflecting growth of assets in fee-based accounts during the year," the company says.
"Entering fiscal 2024, the investment banking pipeline remains healthy and new business activity is solid," says Reilly.