Investment Thesis

Headquartered in Atlanta, Georgia, and with about $3 billion in assets, Atlantic Capital Bancshares, Inc. (ACBI) is a commercially focused bank with specialties in specialty corporate lending, private banking, and commercial real estate finance solutions. The company has the 13th largest deposit market share in the greater Atlanta MSA, just behind Cadence Bancorp (CADE), Renasant (RNST), and Bank OZK (OZK).

I am a little more constructive on the bank since the first quarter update. The exposure to economically sensitive loans has narrowed to 9% of total loans (from ~30%). To me, this means that potential realized losses could be lower than previously expected and roughly in line with other regional bank peers. The core net interest margin (NIM) remains under pressure but expense control should help profitability over the near term.

When weighing out the puts and takes, I am still neutral on the stock. This partially is due to ACBI’s valuation, which is roughly in line with its peer group. While I believe the company should be a beneficiary of competitive disruption in the Atlanta market, I think there are more pressing issues over the next few quarters.

When mixing in valuation relative to the riskier credit profile, I suggest potential shareholder remain on the sidelines, at least until the third quarter update in a few weeks.

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Revenue Outlook

In the second quarter, ACBI reported EPS from continuing operations of $0.09 versus consensus expectations of $0.13, relative to its $0.10 in the first quarter. The second quarter downside came primarily from elevated provisioning offset partially by higher revenue and lower expenses. The company’s pre-provision net revenue was $11.1 million, compared to $10.5 million in the first quarter and $9.7 million in the second quarter of last year.

In the second quarter, net interest income

Adds and background on refinery

Oct 6 (Reuters)Canada-based oil refinery operator Irving Oil on Tuesday said it has terminated an agreement for the purchase of North Atlantic Refinery Limited, the company said in a statement on its website.

Irving had agreed to buy the owner of the idled 135,000 barrels per day Come-by-Chance refinery in Newfoundland, for an undisclosed price in May.

According to industry sources, Irving walked away from the purchase and share agreement shortly before it was set to close in mid-October.

“North Atlantic is actively looking for alternate buyer, but the market is very challenging,” said a source familiar with the matter.

Workers are expected to be told at an all-staff meeting on Tuesday morning.

Refining margins have been weighed down by lower processing rates due to an oversupply of distillate stocks, which include jet fuel. The crack spread – the difference between crude and fuel – is currently hovering around $10.50 a barrel.

The Come-by-Chance refinery was the first to close in North America as refiners worldwide began to scale back to adjust to a sudden demand slump due to the coronavirus pandemic.

It supplied products to major harbors on the U.S. East Coast including New York and Boston.

The plant has been idled since early April, but Irving indicated it would restart the plant following the close of the sale.

The refinery was nearly sold in 2018, with Irving Oil as the leading bidder, but the two former oil traders at the helm of the refinery disagreed on the sale price and the sale subsequently fell apart.

(Reporting by K. Sathya Narayanan in Bengaluru and Laura Sanicola in New York Editing by Chizu Nomiyama and Nick Zieminski)

((Sathya.Narayanan@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6182 2732; Reuters

Opponents of the drilling declared victory on Thursday after the government acknowledged that permits to allow seismic blasting in the ocean — the first step toward locating oil deposits for drilling — will expire next month and not be renewed.

Nine state attorneys general and several conservation groups filed a federal lawsuit early last year to block seismic blasting, arguing it could harm endangered whales and other marine animals. The court battle dragged out so slowly that, in the meantime, time ran out on the permits.

Donna Wieting, director of the National Marine Fisheries Service, a division of the National Oceanic and Atmospheric Administration, said Thursday that her agency “has no authority to extend the terms of those [permits] upon their expiration. Further, NMFS has no basis for reissuing or renewing these [permits].” The five companies that were granted permits would have to restart the months-long process leading to approval or denial, Wieting said.

Also on Thursday, U.S. District Judge Richard Gergel of South Carolina held a telephone conference with all parties of the lawsuit to determine how to move forward. The judge is expected to declare the case moot because the seismic mapping cannot occur without the permits, said Michael Jasny, who was on the call and is director of the Marine Mammal Protection Project at the Natural Resources Defense Council.

The attorneys and conservationists are focused on protecting the North Atlantic right whale, which is “one step from extinction,” the International Union for Conservation of Nature determined in July. Only about 250 adults remain, including 100 breeding females after collisions with ships, entanglements in fishing nets and underwater noise pollution, according to an assessment by the group.

“It’s most definitely a win. There’s no question,” Jasny said. “Given the broad bipartisan opposition that the threat of seismic blasting

(Bloomberg) — General Atlantic will invest 36.8 billion rupees ($498 million) in billionaire Mukesh Ambani’s retail venture as Asia’s richest man continues to garner funds after securing more than $20 billion for his digital services unit earlier this year.



a stop sign: Signage for Reliance Digital Retail Ltd., a subsidiary of Reliance Industries Ltd., is displayed outside a company store in Mumbai, India, on Tuesday, July 14, 2020. Google is in advanced talks to buy a $4 billion stake in Jio Platforms Ltd., the digital arm of Indian billionaire Mukesh Ambani's conglomerate, people familiar with the matter said, seeking to join rival Facebook Inc. in chasing growth in a promising internet and e-commerce market.


© Bloomberg
Signage for Reliance Digital Retail Ltd., a subsidiary of Reliance Industries Ltd., is displayed outside a company store in Mumbai, India, on Tuesday, July 14, 2020. Google is in advanced talks to buy a $4 billion stake in Jio Platforms Ltd., the digital arm of Indian billionaire Mukesh Ambani’s conglomerate, people familiar with the matter said, seeking to join rival Facebook Inc. in chasing growth in a promising internet and e-commerce market.

The private equity firm will hold a 0.84% stake in Reliance Retail Ventures Ltd., according to an exchange filing Wednesday, giving the business a pre-money equity value of 4.29 trillion rupees. Shares of the parent, Reliance Industries Ltd., jumped as much as 5.6% during trading in Mumbai Wednesday after the deal was announced.

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The deal follows U.S. private equity group KKR & Co.’s $754 million investment and Silver Lake Partner’s $1 billion investment this month in the unit. Ambani has been increasing his focus on consumer businesses to tap the growth in both offline and online retail in India’s market of billion-plus consumers.

In his pivot toward technology and retail — away from the group’s staple oil-refining business — Ambani, 63, has raised more than $20 billion by selling stakes in Jio Platforms Ltd., his digital services unit. Investors including Facebook Inc. and Google bought a combined 33% in that venture this year.

After $20 Billion Jio Frenzy, Ambani Seeks Money for Retail

Like KKR and Silver Lake’s investments in Reliance Retail, this infusion makes General Atlantic a repeat investor in Ambani’s consumer businesses. The