2 unchanged sentences
Banner is a bank holding company incorporated in the State of Washington, which wholly owns one subsidiary bank, Banner Bank.
−Removed: The Bank is a Washington-chartered commercial bank that conducts business from its main office in Walla Walla, Washington, and as of September 30, 2024, it had 135 branch offices and 13 loan production offices located in Washington, Oregon, California, Idaho and Utah.
+Added: The Bank is a Washington-chartered commercial bank that conducts business from its main office in Walla Walla, Washington, and as of March 31, 2025, it had 135 branch offices and 13 loan production offices located in Washington, Oregon, California, Idaho and Utah.
Banner is subject to regulation by the Federal Reserve.
The Bank is subject to regulation by the Washington State Department of Financial Institutions – Division of Banks (the DFI) and the Federal Deposit Insurance Corporation (the FDIC).
−Removed: As of September 30, 2024, we had total consolidated assets of $16.19 billion, total loans of $11.22 billion, total deposits of $13.54 billion and total shareholders’ equity of $1.79 billion.
+Added: As of March 31, 2025, we had total consolidated assets of $16.17 billion, total loans of $11.44 billion, total deposits of $13.59 billion and total shareholders’ equity of $1.83 billion.
The Bank is a regional bank that offers a wide variety of commercial banking services and financial products to individuals, businesses and public sector entities in its primary market areas.
4 unchanged sentences
The Company’s longer term strategic initiatives continue to focus on originating high quality assets and client acquisition, which we believe will continue to generate strong revenue while maintaining the Company’s moderate risk profile.
−Removed: Third Quarter 2024 Financial Highlights
−Removed: • Revenue was $153.7 million for the third quarter of 2024, compared to $149.7 million in the preceding quarter.
−Removed: • Adjusted revenue* (the total of net interest income and total non-interest income adjusted for the net gain or loss on the sale of securities and the net change in valuation of financial instruments) was $153.7 million in the third quarter of 2024, compared to $150.5 million in the preceding quarter.
−Removed: • Net interest income was $135.7 million in the third quarter of 2024, compared to $132.5 million in the preceding quarter.
+Added: First Quarter 2025 Financial Highlights
• Net interest margin, on a tax equivalent basis, was 3.92%, compared to 3.82% in the preceding quarter.
−Removed: • Mortgage banking operations revenue was $3.2 million for the third quarter of 2024, compared to $3.0 million in the preceding quarter.
−Removed: • Return on average assets was 1.13%, compared to 1.02% in the preceding quarter.
−Removed: • Net loans receivable increased 1% to $11.07 billion at September 30, 2024, compared to $10.99 billion at June 30, 2024.
−Removed: • Non-performing assets were $45.2 million, or 0.28% of total assets, at September 30, 2024, compared to $33.3 million, or 0.21% of total assets at June 30, 2024.
−Removed: • The allowance for credit losses - loans was $154.6 million, or 1.38% of total loans receivable, as of September 30, 2024, compared to $152.8 million, or 1.37% of total loans receivable, at June 30, 2024.
−Removed: • Total deposits increased to $13.54 billion at September 30, 2024, compared to $13.08 billion at June 30, 2024.
−Removed: • Core deposits represented 89% of total deposits at September 30, 2024.
−Removed: • Dividends paid to shareholders were $0.48 per share in the quarter ended September 30, 2024.
−Removed: • Common shareholders’ equity per share increased 6% to $52.06 at September 30, 2024, compared to $49.07 at the preceding quarter end.
−Removed: • Tangible common shareholders’ equity per share* increased 8% to $41.12 at September 30, 2024, compared to $38.12 at the preceding quarter end.
+Added: • Revenue was $160.2 million for the first quarter of 2025, compared to $160.6 million in the preceding quarter.
+Added: • Net interest income was $141.1 million in the first quarter of 2025, compared to $140.5 million in the preceding quarter.
+Added: • Mortgage banking operations revenue was $3.1 million for the first quarter of 2025, compared to $3.7 million in the preceding quarter.
+Added: • Return on average assets was 1.15% for both the current and preceding quarter.
+Added: • Net loans receivable increased to $11.28 billion at March 31, 2025, compared to $11.20 billion at December 31, 2024.
+Added: • Non-performing assets were $42.7 million, or 0.26% of total assets, at March 31, 2025, compared to $39.6 million, or 0.24% of total assets at December 31, 2024.
+Added: • The allowance for credit losses - loans was $157.3 million, or 1.38% of total loans receivable, as of March 31, 2025, compared to $155.5 million, or 1.37% of total loans receivable, at December 31, 2024.
+Added: • Total deposits increased to $13.59 billion at March 31, 2025, compared to $13.51 billion at December 31, 2024.
+Added: • Core deposits represented 89% of total deposits at March 31, 2025.
+Added: • Dividends paid to shareholders were $0.48 per share in the quarter ended March 31, 2025.
+Added: • Common shareholders’ equity per share increased 3% to $53.16 at March 31, 2025, compared to $51.49 at December 31, 2024.
+Added: • Tangible common shareholders’ equity per share* increased 4% to $42.27 at March 31, 2025, compared to $40.57 at December 31, 2024.
*Non-GAAP Financial Measures:
7 unchanged sentences
Management believes that these non-GAAP financial measures provide information to investors that is useful in evaluating the operating performance and trends of financial services companies, including the Company (dollars in thousands except per share data).
−Removed: Quarters Ended Nine Months Ended September 30,
−Removed: Sep 30, 2024 Jun 30, 2024 Sep 30, 2023 2024 2023
+Added: Quarters Ended
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
ADJUSTED REVENUE
2 unchanged sentences
Total revenue (GAAP) 160,191 160,571 144,550
−Removed: Net loss on sale of securities — 562 2,657 5,465 14,436
+Added: Net (gain) loss on sale of securities — (275) 4,903
Net change in valuation of financial instruments carried at fair value (315) (161) 992
Adjusted revenue (non-GAAP) $ 159,876 $ 160,135 $ 150,445
−Removed: Quarters Ended Nine Months Ended September 30,
−Removed: Sep 30, 2024 Jun 30, 2024 Sep 30, 2023 2024 2023
+Added: Quarters Ended
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
ADJUSTED EARNINGS
Net income (GAAP) $ 45,135 $ 46,391 $ 37,559
−Removed: Net loss on sale of securities — 562 2,657 5,465 14,436
+Added: Net (gain) loss on sale of securities — (275) 4,903
Net change in valuation of financial instruments carried at fair value (315) (161) 992
−Removed: Banner Forward expenses (1)
−Removed: — — 996 — 1,334
Related net tax expense (benefit) 76 105 (1,415)
8 unchanged sentences
10.12 % 10.28 % 10.24 %
−Removed: Quarters Ended Nine Months Ended September 30,
−Removed: Sep 30, 2024 Jun 30, 2024 Sep 30, 2023 2024 2023
+Added: Quarters Ended
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
ADJUSTED EFFICIENCY RATIO
Non-interest expense (GAAP) $ 101,259 $ 99,478 $ 97,641
−Removed: Banner Forward expenses (1)
−Removed: — — (996) — (1,334)
CDI amortization (456) (589) (723)
5 unchanged sentences
Total revenue (GAAP) 160,191 160,571 144,550
−Removed: Net loss on sale of securities — 562 2,657 5,465 14,436
+Added: Net (gain) loss on sale of securities — (275) 4,903
Net change in valuation of financial instruments carried at fair value (315) (161) 992
3 unchanged sentences
62.18 % 60.74 % 63.70 %
−Removed: (1) Included in miscellaneous expenses in the Consolidated Statement of Operations.
(1) Adjusted earnings (non-GAAP) divided by average assets.
7 unchanged sentences
TANGIBLE COMMON SHAREHOLDERS’ EQUITY TO TANGIBLE ASSETS
−Removed: September 30, 2024 June 30, 2024 December 31, 2023 September 30, 2023
+Added: March 31, 2025 December 31, 2024 March 31, 2024
Shareholders’ equity (GAAP) $ 1,833,453 $ 1,774,326 $ 1,664,508
7 unchanged sentences
TANGIBLE COMMON SHAREHOLDERS’ EQUITY PER SHARE
−Removed: September 30, 2024 June 30, 2024 December 31, 2023 September 30, 2023
+Added: March 31, 2025 December 31, 2024 March 31, 2024
Shareholders’ equity (GAAP) $ 1,833,453 $ 1,774,326 $ 1,664,508
12 unchanged sentences
Certain estimates inherently have a greater reliance on the use of assumptions and judgments and, as such, have a greater possibility of producing results that could be materially different than originally reported.
−Removed: Management believes that the allowance for credit losses and fair value require significant judgements and assumptions which are susceptible to significant changes based on the current environment.
+Added: Management believes that the allowance for credit losses and fair value measurements require significant judgements and assumptions which are susceptible to significant changes based on the current environment.
There have been no significant changes in our application of critical accounting estimates since December 31, 2024.
−Removed: Comparison of Financial Condition at September 30, 2024 and December 31, 2023
−Removed: Total assets increased $518.3 million to $16.19 billion at September 30, 2024, from $15.67 billion at December 31, 2023.
−Removed: The increase was primarily due to loan growth and an increase in cash in interest-bearing deposits, partially offset by a decrease in the securities portfolio.
+Added: Comparison of Financial Condition at March 31, 2025 and December 31, 2024
+Added: Total assets decreased $29.2 million to $16.17 billion at March 31, 2025, from $16.20 billion at December 31, 2024.
+Added: The decrease compared to year end was primarily due to a decrease in securities and interest-bearing deposits, partially offset by loan growth.
Loans and lending:
1 unchanged sentence
We attempt to maintain a total loans to total deposits ratio at a level designed to enhance our revenues, while adhering to sound underwriting practices and appropriate diversification guidelines in order to maintain a moderate risk profile.
−Removed: Our loan to deposit ratio at September 30, 2024 was 83%.
+Added: Our loan to deposit ratio at March 31, 2025 was 84%.
We offer a wide range of loan products to meet the demands of our clients.
Our lending activities are primarily directed toward the origination of real estate and commercial loans.
−Removed: Total loans receivable (gross loans less deferred fees and discounts and excluding loans held for sale) increased $414.2 million at September 30, 2024, compared to December 31, 2023, reflecting increased commercial real estate loans, multifamily loans, one-to-four family residential loans, land and land development loans and commercial business loans, partially offset by decreased commercial construction and one-to-four family construction loans.
−Removed: At September 30, 2024, loans receivable totaled $11.22 billion compared to $10.81 billion at December 31, 2023.
+Added: Total loans receivable (gross loans less deferred fees and discounts and excluding loans held for sale) increased $84.1 million at March 31, 2025, compared to December 31, 2024, reflecting increased commercial construction, multifamily construction and land and land development loans, partially offset by decreased commercial real estate, multifamily, commercial business and one-to-four family construction loans.
+Added: At March 31, 2025, loans receivable totaled $11.44 billion compared to $11.35 billion at December 31, 2024.
The following table sets forth the composition of the Company’s loans receivable by type of loan as of the dates indicated (dollars in thousands):
Percentage Change
−Removed: Sep 30, 2024 Dec 31, 2023 Sep 30, 2023 Year End Prior Year Qtr.
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024 Year End Prior Year Qtr.
Commercial real estate:
20 unchanged sentences
Total loans receivable $ 11,438,796 $ 11,354,656 $ 10,869,096 1 % 5 %
−Removed: Commercial real estate loans totaled $3.79 billion, or 34% of our loan portfolio, and multifamily real estate loans totaled $889.9 million, or 8% of our loan portfolio, at September 30, 2024.
−Removed: Commercial real estate loans increased by $157.5 million during the first nine months of 2024, while multifamily real estate loans increased by $78.6 million, primarily due to the conversion of construction loans to the permanent loans upon the completion of the construction phase.
−Removed: Our construction, land and land development loans totaled $1.53 billion, or 14% of our loan portfolio, at September 30, 2024, compared to $1.54 billion at December 31, 2023.
−Removed: Multifamily construction loans increased $20.1 million, or 4%, to $524.1 million at September 30, 2024, compared to December 31, 2023.
−Removed: Multifamily construction and one- to four-family construction loans each represented approximately 5% of our total loan portfolio at September 30, 2024.
+Added: Commercial real estate loans totaled $3.84 billion, or 33% of our loan portfolio, and multifamily real estate loans totaled $877.7 million, or 8% of our loan portfolio, at March 31, 2025.
+Added: Commercial real estate loans decreased by $28.2 million during the first three months of 2025, while multifamily real estate loans decreased by $16.7 million, primarily due to payoffs and paydowns exceeding new production.
+Added: Our construction, land and land development loans totaled $1.67 billion, or 15% of our loan portfolio, at March 31, 2025, compared to $1.52 billion at December 31, 2024.
+Added: Multifamily construction loans increased $105.2 million, or 20%, to $618.9 million at March 31, 2025, compared to December 31, 2024.
+Added: Multifamily construction represented approximately 6% of our total loan portfolio at March 31, 2025.
Multifamily construction loans were comprised primarily of affordable housing projects and, to a lesser extent, market rate multifamily projects across our footprint.
−Removed: Commercial construction loans decreased $46.0 million, or 27%, to $124.1 million at September 30, 2024, compared to $170.0 million at December 31, 2023, due to the completion of the construction phase.
−Removed: Land and land development loans increased $34.1 million, or 10%, to $370.7 million at September 30, 2024, compared to December 31, 2023.
+Added: Commercial construction loans increased $24.1 million, or 20%, to $146.5 million at March 31, 2025, compared to $122.4 million at December 31, 2024, due to advances and new loan production, partially offset by transfers to the permanent loan portfolio upon completion of the construction phase.
+Added: Land and land development loans increased $26.3 million, or 7%, to $396.0 million at March 31, 2025, compared to December 31, 2024, primarily due to new loan production, partially offset by payoffs and paydowns.
Our commercial business lending is directed toward meeting the credit and related deposit needs of various small- to medium-sized business and agribusiness borrowers operating in our primary market areas.
−Removed: Our commercial and agricultural business loans were $2.72 billion at September 30, 2024 and $2.60 billion at December 31, 2023.
−Removed: Commercial and agricultural business loans represented approximately 24% of our loan portfolio at September 30, 2024.
−Removed: Our commercial business lending also includes participation in certain syndicated loans, including shared national credits, which totaled $226.2 million, or 2% of our loan portfolio, at September 30, 2024, compared to $239.0 million, or 2% of our loan portfolio, at December 31, 2023.
+Added: Our commercial and agricultural business loans were $2.74 billion at March 31, 2025 and $2.76 billion at December 31, 2024.
+Added: Commercial and agricultural business loans represented approximately 24% of our loan portfolio at March 31, 2025.
+Added: Our commercial business lending also includes participation in certain syndicated loans, including shared national credits, which totaled $223.6 million, or 2% of our loan portfolio, at March 31, 2025, compared to $227.4 million, or 2% of our loan portfolio, at December 31, 2024.
We are active originators of one- to four-family residential loans in most communities where we have established offices in Washington, Oregon, California, Idaho and Utah.
Most of the one- to four-family residential loans we originate in normal market conditions are sold in secondary markets with net gains on sales and loan servicing fees reflected in our revenues from mortgage banking operations.
−Removed: At September 30, 2024, one- to four-family residential loans retained in our portfolio increased $57.1 million, to $1.58 billion, compared to $1.52 billion at December 31, 2023.
−Removed: The increase in one- to four-family residential loans was primarily the result of a higher percentage of one- to four-family construction loans converting to one- to four-family residential loans, offset by the transfer of certain pools of one- to four-family residential loans to held for sale.
−Removed: One- to four-family residential loans represented 14% of our loan portfolio at September 30, 2024.
+Added: At March 31, 2025, one- to four-family residential loans retained in our portfolio increased $9.0 million, to $1.60 billion, compared to $1.59 billion at December 31, 2024.
+Added: The increase in one- to four-family residential loans was primarily the result of a higher percentage of one- to four-family construction loans converting to permanent one- to four-family residential loans and new loan production.
+Added: One- to four-family residential loans represented 14% of our loan portfolio at March 31, 2025.
Our consumer loan activity is primarily directed at meeting demand from our existing deposit clients.
−Removed: At September 30, 2024, consumer loans, including home equity revolving lines of credit, increased $24.8 million to $724.2 million, compared to $699.4 million at December 31, 2023.
+Added: At March 31, 2025, consumer loans, including home equity revolving lines of credit, decreased $4.2 million to $717.2 million, compared to $721.4 million at December 31, 2024.
The following table shows the commitment amount for loan origination activity (excluding loans held for sale) for the periods indicated (in thousands):
−Removed: Three Months Ended Nine Months Ended
−Removed: Sep 30, 2024 Jun 30, 2024 Sep 30, 2023 Sep 30, 2024 Sep 30, 2023
+Added: Three Months Ended
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
Commercial real estate $ 37,041 $ 124,554 $ 67,362
6 unchanged sentences
Total commitment amount for loan originations (excluding loans held for sale) $ 535,834 $ 802,033 $ 777,854
−Removed: Loans held for sale increased to $78.8 million at September 30, 2024, compared to $11.2 million at December 31, 2023.
−Removed: The increase in loans held for sale was primarily the result of the transfer of $47.5 million of one- to four-family residential loans from portfolio to held for sale during the third quarter of 2024.
−Removed: Originations of loans held for sale increased to $197.7 million for the nine months ended September 30, 2024, compared to $187.1 million for the same period last year.
−Removed: The volume of one- to four-family residential mortgage loans sold was $255.7 million during the nine months ended September 30, 2024, compared to $190.4 million in the same period a year ago.
+Added: Loans held for sale decreased to $24.5 million at March 31, 2025, compared to $32.0 million at December 31, 2024.
+Added: The decrease in loans held for sale compared to the preceding quarter was primarily the result of loan sales exceeding new originations of one- to four- family residential mortgage loans held for sale during the quarter.
+Added: Originations of loans held for sale increased to $75.2 million for the three months ended March 31, 2025, compared to $48.4 million for the same period last year.
+Added: The volume of one- to four-family residential mortgage loans sold was $108.1 million during the three months ended March 31, 2025, compared to $65.9 million in the same period a year ago.
The following table presents loans by geographic concentration at the dates indicated (dollars in thousands):
−Removed: Sep 30, 2024 Dec 31, 2023 Sep 30, 2023 Percentage Change
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024 Percentage Change
Amount Percentage Amount Amount Year End Prior Year Qtr.
7 unchanged sentences
Investment Securities:
−Removed: Total securities decreased $181.0 million to $3.25 billion at September 30, 2024, from $3.43 billion at December 31, 2023, primarily due to securities sales, paydowns and maturities exceeding purchases during the nine-month period ended September 30, 2024.
−Removed: Purchases during the nine months ended September 30, 2024, consisted primarily of state and local government obligations.
−Removed: The average effective duration of the Company’s securities portfolio was 6.3 years at September 30, 2024, compared to 6.5 years at December 31, 2023.
−Removed: Fair value adjustments for securities designated as available-for-sale increased $64.7 million for the nine months ended September 30, 2024, which was included, net of the associated tax expense of $15.5 million, as a component of other comprehensive income, and occurred as a result of decreases in market interest rates during the nine months ended September 30, 2024.
+Added: Total securities decreased $5.3 million to $3.10 billion at March 31, 2025, from $3.11 billion at December 31, 2024, primarily due to securities paydowns and maturities exceeding purchases during the three months ended March 31, 2025.
+Added: Purchases during the three months ended March 31, 2025, consisted primarily of state and local government obligations.
+Added: The average effective duration of the Company’s securities portfolio was 6.5 years at March 31, 2025, compared to 6.6 years at December 31, 2024.
+Added: Fair value adjustments for securities designated as available-for-sale increased $38.3 million for the three months ended March 31, 2025, which was included, net of the associated tax expense of $9.2 million, as a component of other comprehensive income, and occurred as a result of decreases in market interest rates during the three months ended March 31, 2025.
Deposits, client retail repurchase agreements and loan repayments are the major sources of our funds for lending and other investment purposes.
5 unchanged sentences
Percentage Change
−Removed: Sep 30, 2024 Dec 31, 2023 Sep 30, 2023 Year End Prior Year Qtr.
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024 Year End Prior Year Qtr.
Non-interest-bearing $ 4,571,598 $ 4,591,543 $ 4,699,553 — % (3) %
6 unchanged sentences
Total deposits $ 13,593,265 $ 13,514,398 $ 13,158,771 1 % 3 %
−Removed: Total deposits increased $508.7 million at September 30, 2024, compared to December 31, 2023, with core deposits increasing $464.3 million and certificates of deposit increasing $44.4 million.
−Removed: The increase in core deposits primarily reflects an increase in third-party insured sweep accounts and normal seasonal increases primarily from agricultural clients.
−Removed: The increase in certificates of deposit is a result of higher rates attracting clients to these deposit types.
−Removed: We had $50.3 million of brokered deposits at September 30, 2024, compared to $108.1 million at December 31, 2023.
−Removed: Core deposits represented 89% of total deposits at both September 30, 2024 and December 31, 2023.
+Added: Total deposits increased $78.9 million at March 31, 2025, compared to December 31, 2024, with core deposits increasing $74.5 million and certificates of deposit increasing $4.4 million.
+Added: The increase in core deposits primarily reflects increases in interest-bearing transaction and savings accounts.
+Added: We had $75.3 million of brokered deposits at March 31, 2025, compared to $50.3 million at December 31, 2024.
+Added: Core deposits represented 89% of total deposits at both March 31, 2025 and December 31, 2024.
Competition for deposits in our market areas remains strong.
The following table sets forth the number and average account balance of the Company’s deposit accounts as of the dates indicated (dollars in thousands):
−Removed: Sep 30, 2024 Dec 31, 2023 Sep 30, 2023
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
Number of deposit accounts 453,808 460,004 461,399
1 unchanged sentence
The following table presents deposits by geographic concentration at the dates indicated (dollars in thousands):
−Removed: Sep 30, 2024 Dec 31, 2023 Sep 30, 2023 Percentage Change
+Added: Mar 31, 2025 Dec 31, 2024 Mar 31, 2024 Percentage Change
Amount Percentage Amount Amount Year End Prior Year Qtr.
4 unchanged sentences
Total deposits $ 13,593,265 100 % $ 13,514,398 $ 13,158,771 1 % 3 %
−Removed: We had $230.0 million of FHLB advances at September 30, 2024, compared to $323.0 million at December 31, 2023.
−Removed: Other borrowings, consisting of retail repurchase agreements primarily related to client cash management accounts, decreased $28.3 million to $154.5 million at September 30, 2024, compared to $182.9 million at December 31, 2023.
−Removed: The decrease in borrowings reflects the increased use of deposits to fund loan growth.
−Removed: At September 30, 2024, the Company’s off-balance sheet liquidity included additional borrowing capacity of $3.23 billion at the FHLB and $1.53 billion at the Federal Reserve as well as federal funds line of credit agreements with other financial institutions of $125.0 million.
−Removed: Junior subordinated debentures totaled $66.3 million at September 30, 2024, compared to $66.4 million at December 31, 2023.
−Removed: Subordinated notes, net of issuance costs were $80.2 million at September 30, 2024, compared to $92.9 million at December 31, 2023.
−Removed: The decrease was due to Banner Bank’s purchase of $13.0 million of Banner’s subordinated debt during the nine months ended September 30, 2024.
+Added: We had $168.0 million of FHLB advances at March 31, 2025, compared to $290.0 million at December 31, 2024.
+Added: Other borrowings, consisting of retail repurchase agreements primarily related to client cash management accounts, increased $5.3 million to $130.6 million at March 31, 2025, compared to $125.3 million at December 31, 2024.
+Added: The overall decrease in borrowings reflects the increased use of deposits to fund loan growth.
+Added: At March 31, 2025, the Company’s off-balance sheet liquidity included additional borrowing capacity of $3.14 billion at the FHLB and $1.65 billion at the Federal Reserve, as well as federal funds line of credit agreements with other financial institutions of $125.0 million.
+Added: Junior subordinated debentures totaled $67.7 million at March 31, 2025, compared to $67.5 million at December 31, 2024.
+Added: Subordinated notes, net of issuance costs were $80.4 million at March 31, 2025, compared to $80.3 million at December 31, 2024.
Shareholders’ Equity:
−Removed: Total shareholders’ equity increased $141.0 million to $1.79 billion, or 11.08% of total assets, at September 30, 2024, compared to $1.65 billion, or 10.55% of total assets, at December 31, 2023.
−Removed: The increase in shareholders’ equity was primarily due to a $72.3 million increase in retained earnings as a result of $122.5 million in net income, partially offset by the accrual of cash dividends during the nine months ended September 30, 2024.
+Added: Total shareholders’ equity increased $59.1 million to $1.83 billion, or 11.34% of total assets, at March 31, 2025, compared to $1.77 billion, or 10.95% of total assets, at December 31, 2024.
+Added: The increase in shareholders’ equity was primarily due to a $28.3 million increase in retained earnings as a result of $45.1 million in net income, partially offset by the accrual of cash dividends during the three months ended March 31, 2025.
In addition, accumulated other comprehensive loss decreased by $29.3 million, primarily due to a decrease in the unrealized losses on the security portfolio.
−Removed: There were no shares of common stock repurchased during the nine months ended September 30, 2024.
−Removed: Tangible common shareholders’ equity, which excludes goodwill and other intangible assets and is a non-GAAP financial measure, increased $143.1 million to $1.42 billion, or 8.96% of tangible assets, at September 30, 2024, compared to $1.27 billion, or 8.33% of tangible assets at December 31, 2023.
−Removed: A reconciliation of this non-GAAP financial measure to its comparable GAAP financial measure is presented above following “Third Quarter 2024 Financial Highlights.”
−Removed: Comparison of Results of Operations for the Three Months Ended September 30, 2024 and June 30, 2024, and for the Nine Months Ended September 30, 2024 and 2023
−Removed: For the quarter ended September 30, 2024, net income was $45.2 million, or $1.30 per diluted share, compared to $39.8 million, or $1.15 per diluted share, for the preceding quarter.
−Removed: For the nine months ended September 30, 2024, net income was $122.5 million, or $3.54 per diluted share, compared to $141.0 million, or $4.09 per diluted share for the same period a year earlier.
−Removed: The increase in net income for the current quarter compared to the preceding quarter was primarily due to an increase in revenue with increases in both net interest income and non-interest income as well as decreases in non-interest expense and the provision for credit losses.
−Removed: Net income for the nine months ended September 30, 2024, included a decrease in net interest income and an increase in non-interest expense, partially offset by an increase in non-interest income and a decrease in the provision for credit losses.
−Removed: The increase in net interest income compared to the preceding quarter reflects an increase in interest-earning assets and net interest margin.
−Removed: Net interest margin for the current quarter benefited from increased yields on loans due to new loans being originated at higher interest rates and adjustable rate loans repricing higher, partially offset by increased funding costs.
−Removed: On September 18, 2024, the Federal Open Market Committee of the Federal Reserve System decreased the target range for the federal funds rate by 50 basis points, and as the change occurred late in the third quarter of 2024, it had minimal impact on our current quarter net interest margin.
−Removed: We recorded a $1.7 million provision for credit losses for the quarter ended September 30, 2024, compared to a $2.4 million provision for credit losses in the preceding quarter.
−Removed: The provision for credit losses for the current quarter primarily reflected an increase in the reserve for collateral dependent loans.
−Removed: The provision for credit losses for the preceding quarter primarily reflected loan growth and an increase in the reserve for collateral dependent loans.
−Removed: We recorded a $4.6 million provision for credit losses for the nine months ended September 30, 2024, compared to an $8.3 million provision for credit losses for the same period a year ago.
−Removed: Total non-interest income increased for the quarter ended September 30, 2024, compared to the preceding quarter and increased during the nine months ended September 30, 2024, compared to the same period a year ago.
−Removed: The increase in non-interest income during the current quarter compared to the preceding quarter was primarily due to decreases in the net loss recognized on the sale of securities and in the net loss recognized for fair value adjustments on financial instruments carried at fair value.
−Removed: The increase in non-interest income during the nine months ended September 30, 2024, compared to the same period last year was also primarily due to a reduction in the net loss recognized on the sale of securities and a decrease in the net loss recognized for fair value adjustments on financial instruments carried at fair value as well as an increase in mortgage banking operations revenues.
−Removed: Total non-interest expense decreased for the quarter ended September 30, 2024, compared to the preceding quarter and increased during the nine months ended September 30, 2024, compared to the same period a year ago.
−Removed: The decrease in non-interest expense for the current quarter compared to the prior quarter reflects a decrease in salary and employee benefits, primarily resulting from decreased medical premiums expense and unemployment and workers compensation expense.
−Removed: The increase in non-interest expense compared to the same period a year ago primarily reflects increases in salary and employee benefits, occupancy and equipment expense, payment and card processing services expense and deposit insurance expense, partially offset by a decrease in professional and legal expenses.
+Added: There were no shares of common stock repurchased during the three months ended March 31, 2025.
+Added: Tangible common shareholders’ equity, which excludes goodwill and other intangible assets and is a non-GAAP financial measure, increased $59.6 million to $1.46 billion, or 9.23% of tangible assets, at March 31, 2025, compared to $1.40 billion, or 8.84% of tangible assets at December 31, 2024.
+Added: A reconciliation of this non-GAAP financial measure to its comparable GAAP financial measure is presented above following “First Quarter 2025 Financial Highlights.”
+Added: Comparison of Results of Operations for the Three Months Ended March 31, 2025 and December 31, 2024, and March 31, 2024
+Added: For the quarter ended March 31, 2025, net income was $45.1 million, or $1.30 per diluted share, compared to $46.4 million, or $1.34 per diluted share, for the preceding quarter and $37.6 million, or $1.09 per diluted share for three months ended March 31, 2024.
+Added: The decrease in net income for the current quarter compared to the preceding quarter was primarily due to a decrease in non-interest income as well as an increase in non-interest expense, partially offset by an increase in net interest income.
+Added: The increase in net income for the current quarter compared to the prior year quarter was primarily due to increases in net interest income and non-interest income, partially offset by increases in non-interest expense and the provision for credit losses.
+Added: The increase in net interest income compared to the preceding quarter reflects an overall increase in the yield on interest-earning assets and a decrease in funding costs, partially offset by a decrease in the average balance of interest-earning assets.
+Added: Net interest margin for the current quarter benefited from decreased funding costs, primarily due to decreases in market interest rates, and increased yields on loans, primarily due to new loans being originated at higher interest rates and adjustable rate loans repricing higher.
+Added: In 2024, the Federal Open Market Committee (“FOMC”) of the Federal Reserve lowered the target range for the federal funds rate three times, resulting in a target range of 4.25% to 4.50% at March 31, 2025.
+Added: The increase in net interest income compared to the prior year quarter reflects an increase in both the yield and average balance of interest-earning assets, partially offset by an increase in funding costs.
+Added: We recorded a $3.1 million provision for credit losses for the quarter ended March 31, 2025, compared to a $3.0 million provision for credit losses in the preceding quarter and a $520,000 provision for credit losses for the three months ended March 31, 2024.
+Added: The provision for credit losses for the current quarter primarily reflected loan growth in the construction portfolio and to a lesser extent risk rating migration and qualitative adjustments applied to address economic uncertainty.
+Added: Total non-interest income decreased for the quarter ended March 31, 2025, compared to the preceding quarter and increased compared to the same period a year ago.
+Added: The decrease in non-interest income during the current quarter compared to the preceding quarter was primarily due to decreases in mortgage banking operations revenue and miscellaneous income, partially offset by an increase in bank owned life insurance income.
+Added: The increase in non-interest income during the current quarter compared to the prior year quarter was primarily due to a decrease in the net loss recognized on the sale of securities and an increase in the fair value adjustments on financial instruments carried at fair value during the current quarter.
+Added: Total non-interest expense increased for the quarter ended March 31, 2025, compared to the preceding quarter and the same period a year ago.
+Added: The increase in non-interest expense for the current quarter compared to the preceding quarter reflects an increase in salary and employee benefits, primarily resulting from increased medical premiums expense and payroll tax expense, and a decrease in capitalized loan costs, partially offset by a decrease in advertising and marketing expenses.
+Added: The increase in non-interest expense for the current quarter compared to the same quarter a year ago primarily reflects increases in salary and employee benefits and professional and legal expenses.
OPERATING DATA:
−Removed: Quarters Ended Nine Months Ended
−Removed: (In thousands) September 30, 2024 June 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023
+Added: Quarters Ended
+Added: (In thousands) March 31, 2025 December 31, 2024 March 31, 2024
Interest income $ 193,868 $ 196,436 $ 184,688
5 unchanged sentences
Mortgage banking operations 3,103 3,686 2,335
−Removed: Net loss on sale of securities — (562) (2,657) (5,465) (14,436)
+Added: Net gain (loss) on sale of securities — 275 (4,903)
Net change in valuation of financial instruments carried at fair value
12 unchanged sentences
PER COMMON SHARE DATA:
−Removed: Quarters Ended Nine Months Ended
−Removed: September 30, 2024 June 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023
+Added: Quarters Ended
+Added: March 31, 2025 December 31, 2024 March 31, 2024
Basic $ 1.31 $ 1.34 $ 1.09
1 unchanged sentence
Net Interest Income.
−Removed: Net interest income increased for the quarter ended September 30, 2024, compared to the preceding quarter.
−Removed: The increase was primarily due to increases in the average yields on loans, partially offset by an increase in the cost of funding liabilities.
−Removed: Net interest margin on a tax equivalent basis increased two basis points to 3.72% for the third quarter of 2024, compared to 3.70% in the preceding quarter.
−Removed: Net interest margin for the current quarter benefited from increased yields on loans due to new loans being originated at higher interest rates and adjustable rate loans repricing higher, partially offset by increased funding costs.
−Removed: The increase in the overall cost of funding liabilities was primarily due to the increase in rates across all deposits and other borrowings due to competition for deposits in the higher rate environment, as well as an increase in the average balances of higher costing interest-bearing checking accounts and savings accounts.
−Removed: Net interest income decreased for the nine months ended September 30, 2024, compared to the same period one year earlier, primarily due to increased funding costs, partially offset by an increase in the average yields on interest-earning assets.
−Removed: The higher funding costs and average yields on interest-earning assets compared to same period a year ago was primarily the result of higher interest rates.
−Removed: The higher funding costs was also impacted by a shift in the average balance of non-interest-bearing deposits to higher costing interest-bearing checking accounts, savings accounts and certificates of deposit.
−Removed: The net interest margin on a tax equivalent basis decreased to 3.72% for the nine months ended September 30, 2024, compared to 4.07% for the same period in the prior year.
+Added: Net interest income increased for the quarter ended March 31, 2025, compared to the preceding quarter and the same period one year earlier.
+Added: The increase in net interest income compared to both comparable periods reflects an overall increase in net interest margin for the current period.
+Added: Net interest margin on a tax equivalent basis increased ten basis points to 3.92% for the first quarter of 2025, compared to 3.82% in the preceding quarter and increased 18 basis points compared to 3.74% for the same period in the prior year.
+Added: Net interest margin for the current quarter, compared to the preceding quarter, benefited from decreased funding costs, primarily due to a decrease in market rates, partially offset by a shift in the average balance of non-interest-bearing deposits to higher costing interest-bearing checking accounts, savings accounts and certificates of deposit, and higher yields on interest earning assets, primarily due to an increase in the average loan yield.
+Added: Net interest margin for the current quarter, compared to the prior year quarter, benefited from an increase in both the yield and the average balance of interest-earning assets, partially offset by higher funding costs.
Interest Income.
−Removed: Interest income for the quarter ended September 30, 2024 was $195.8 million, compared to $189.1 million for the preceding quarter.
−Removed: The increase in interest income primarily reflects increases in both the average yields and average balances of loans.
−Removed: The increased yield on interest-earning assets was primarily a result of average yields on total interest-earning assets increasing eight basis points.
−Removed: The increased interest income on loans for the current quarter compared to the preceding quarter was due to the average loan yields increasing to 6.04% for the quarter ended September 30, 2024, from 5.96% in the preceding quarter, as the loan portfolio continued to reprice to higher interest rates for the majority of the quarter.
−Removed: The average balance of loans receivable for the quarter ended September 30, 2024 increased compared to the preceding quarter, primarily reflecting increases in the average balances of mortgage loans, specifically commercial real estate and multifamily loans.
−Removed: Interest and dividend income on total investment securities for the current quarter decreased from the preceding quarter due to a lower average yield earned on total investment securities during the current quarter compared to the preceding quarter and a decrease in the average balance of total investment securities.
−Removed: The average balance of total investment securities decreased to $3.63 billion for the quarter ended September 30, 2024 (excluding the effect of fair value adjustments), compared to $3.71 billion for the preceding quarter.
−Removed: The average yield on the combined portfolio decreased to 3.12% for the quarter ended September 30, 2024, from 3.14% in the preceding quarter.
−Removed: Interest income for the nine months ended September 30, 2024 was $569.7 million, compared to $517.8 million for the same period in the prior year, primarily reflecting an increase in the average yield on interest-earning assets, mostly due to the high interest rate environment, as well as an increase in the average balance of interest-earning assets.
+Added: Interest income for the quarter ended March 31, 2025 was $193.9 million, compared to $196.4 million for the preceding quarter and $184.7 million for the same period in the prior year.
+Added: The decrease in interest income during the current quarter compared to the preceding quarter primarily reflects two fewer interest earning days in the current quarter and a decrease in the average balance of interest-earning assets due to a decrease in the average balance of investment securities.
+Added: The increase in interest income during the current quarter compared to the prior period a year ago reflects an increase in interest income on loans due to an increase in the overall average loan yield, mostly due to the high interest rate environment.
+Added: In addition, the increase reflects growth in the average balance of loans, partially offset by a decreases in both the yield and average balance of investment securities.
+Added: The decreased interest income on loans for the current quarter compared to the preceding quarter was primarily driven by two fewer days in the quarter.
+Added: The increase in interest income on loans for the current quarter compared to the same period in the prior year was due to an increase in both the average balance and yield on loans.
+Added: Loan yields increased five basis points to 6.07% for the quarter ended March 31, 2025, from 6.02% in the preceding quarter and increased 20 basis points compared to 5.87% in the first quarter a year ago, due to new loans being originated at higher interest rates and adjustable rate loans repricing higher.
+Added: The average balance of loans receivable for the quarter ended March 31, 2025 increased compared to both comparable periods, primarily reflecting increases in the average balances of mortgage loans, specifically commercial real estate and construction loans.
+Added: Interest and dividend income on total investment securities for the current quarter decreased from both the preceding and prior year quarters due to a lower average yield earned on total investment securities during the current quarter and a decrease in the average balance of total investment securities.
+Added: The average balance of total investment securities decreased to $3.52 billion for the quarter ended March 31, 2025 (excluding the effect of fair value adjustments), compared to $3.61 billion for the preceding quarter and $3.78 billion for same period in the prior year.
+Added: The average yield on the combined portfolio decreased to 3.02% for the quarter ended March 31, 2025, from 3.07% for the preceding quarter and 3.11% for the same period in the prior year.
Interest Expense.
−Removed: Interest expense for the quarter ended September 30, 2024 increased $3.6 million, or 6%, compared to the preceding quarter.
−Removed: The increase occurred as a result of a seven basis-point increase in the average cost of all funding liabilities to 1.73% and an increase in the average balance of funding liabilities during the current quarter.
−Removed: The average balance of funding liabilities increased primarily due to higher average balances of interest-bearing transaction and savings accounts, partially offset by a decrease in the average balance of non-interest-bearing deposits and FHLB advances.
−Removed: Interest expense for the nine months ended September 30, 2024 was $168.5 million, compared to $80.2 million for the same period in the prior year.
−Removed: The increase occurred as a result of an increase in the average cost of all funding liabilities compared to the same period in the prior year, partially offset by a decrease in average balances of funding liabilities.
−Removed: The decrease in the overall average balance of funding liabilities primarily reflects decreases in non-interest-bearing deposits, money market accounts and other borrowings, partially offset by higher average balances of interest-bearing transaction checking and savings accounts and certificates of deposit.
−Removed: Deposit interest expense for the quarter ended September 30, 2024 increased $4.9 million, or 10%, compared to the preceding quarter.
−Removed: The increase was the result of a larger percentage of core deposits being in interest-bearing accounts and an increase in higher cost certificates of deposit, as well as an overall increase in the average rate paid on interest-bearing deposits.
−Removed: The cost of interest-bearing deposits increased to 2.45% for the quarter ended September 30, 2024, compared to 2.32% in the preceding quarter.
−Removed: The increase in the average cost of interest-bearing deposits was primarily the result of an increase in the cost of interest-bearing checking and savings accounts.
−Removed: The average rate paid on total deposits, which includes non-interest-bearing deposits, was 1.61% for the quarter ended September 30, 2024, compared to 1.50% in the preceding quarter.
−Removed: Average deposit balances increased to $13.32 billion for the quarter ended September 30, 2024, from $13.10 billion for the preceding quarter.
−Removed: Deposit interest expense for the nine months ended September 30, 2024 increased to $147.2 million, compared to $60.8 million for the same period in the prior year.
−Removed: The average cost of interest-bearing deposits increased to 2.31% for the nine months ended September 30, 2024, compared to 1.07% in the same period a year earlier.
−Removed: The increase in the cost of interest-bearing deposits was the result of an overall increase in the average rate paid on interest-bearing deposits, reflecting the increase in market interest rates.
−Removed: Average total deposit balances increased to $13.16 billion for the nine months ended September 30, 2024, from $13.14 billion for the same period a year earlier, while the average rate paid on total deposits increased to 1.49% for the nine months ended September 30, 2024 from 0.62% for the same period in the prior year.
−Removed: Interest expense on total borrowings for the quarter ended September 30, 2024 decreased $1.4 million, or 18%, compared to the prior quarter, primarily due to a decrease in the average balance of total borrowings.
−Removed: The average balance of total borrowings decreased to $499.9 million for the quarter ended September 30, 2024, compared to $614.2 million for the preceding quarter, primarily due to a $98.1 million decrease in the average balance of FHLB advances.
−Removed: The average rate paid on total borrowings for the quarter ended September 30, 2024 increased to 5.08% from 5.07% for the preceding quarter.
−Removed: Interest expense on total borrowings for the nine months ended September 30, 2024 increased to $21.2 million from $19.5 million for the same period a year earlier due to an increase in the rate paid on total borrowings, partially offset by a decrease in the average balance of total borrowings.
−Removed: The average balance of total borrowings was $562.9 million for the nine months ended September 30, 2024, compared to $610.4 million for the same period a year earlier.
−Removed: The decrease was primarily due to a $32.1 million decrease in the average balance of other borrowings.
−Removed: The average rate paid on total borrowings for the nine months ended September 30, 2024 increased to 5.04% from 4.26% for the same period a year earlier.
+Added: Interest expense for the quarter ended March 31, 2025 decreased $3.1 million, or 6%, to $52.8 million compared to $55.9 million for the preceding quarter, and increased compared to $51.7 million for the same period in the prior year.
+Added: The decrease compared to the preceding quarter occurred as a result of a five basis-point decrease in the average cost of all funding liabilities to 1.55% for the quarter ended March 31, 2025.
+Added: The increase compared to the prior year occurred as a result of an increase in both the average cost and balance of total funding liabilities.
+Added: Deposit interest expense for the quarter ended March 31, 2025 decreased $3.5 million, or 7%, to $48.7 million compared to $52.2 million for the preceding quarter, and increased compared to $44.6 million for the same period in the prior year.
+Added: The decrease in deposit costs in the current quarter compared to the prior quarter was primarily due to the lagging effect of interest rate decreases in the prior quarter.
+Added: The average cost of interest-bearing deposits decreased to 2.22% for the quarter ended March 31, 2025, compared to 2.33% in the preceding quarter and increased compared to 2.15% for the same period a year earlier.
+Added: The decrease in the cost of interest-bearing deposits compared to the preceding quarter reflects the interest rate decreases implemented on our interest-bearing deposits in the prior quarter.
+Added: The increase in the cost of interest-bearing deposits compared to the same period a year earlier was primarily the result of an overall increase in the average rate paid on interest-bearing deposits.
+Added: The average rate paid on total deposits, which includes non-interest-bearing deposits, was 1.47% for the quarter ended March 31, 2025, compared to 1.53% in the preceding quarter and 1.37% for the same period in the prior year.
+Added: Average deposit balances decreased to $13.45 billion for the quarter ended March 31, 2025, from $13.56 billion for the preceding quarter and increased from $13.06 billion for the same period a year earlier.
+Added: Interest expense on total borrowings for the quarter ended March 31, 2025 increased 10%, to $4.0 million compared to $3.7 million for the prior quarter, primarily due to an increase in the average balance of total borrowings, and decreased from $7.1 million for the same period a year earlier, primarily due to decreases in both the rate paid and the average balance of total borrowings.
+Added: The average balance of total borrowings increased to $379.7 million for the quarter ended March 31, 2025, compared to $320.3 million for the preceding quarter, primarily due to a $67.8 million increase in the average balance of FHLB advances, and decreased compared to $575.3 million for the same period a year earlier, primarily due to a $137.7 million decrease in the average balance of FHLB advances and $45.9 million decrease in the average balance of other borrowings.
+Added: The average rate paid on total borrowings for the quarter ended March 31, 2025 decreased to 4.32% from 4.57% for the preceding quarter and 4.98% for the same period a year earlier.
Analysis of Net Interest Spread .
2 unchanged sentences
ANALYSIS OF NET INTEREST SPREAD Quarters Ended
−Removed: (rates / ratios annualized) Sep 30, 2024 Jun 30, 2024
+Added: (rates / ratios annualized) Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
(dollars in thousands) Average Balance Interest and Dividends Yield / Cost (3)
Average Balance Interest and Dividends Yield / Cost (3)
−Removed: Interest-earning assets:
−Removed: Held for sale loans $ 26,954 $ 453 6.69 % $ 11,665 $ 206 7.10 %
−Removed: Mortgage loans 9,207,468 135,497 5.85 % 9,006,857 129,230 5.77 %
−Removed: Commercial/agricultural loans 1,879,215 32,547 6.89 % 1,874,039 31,761 6.82 %
−Removed: Consumer and other loans 128,548 2,154 6.67 % 132,661 2,156 6.54 %
−Removed: Total loans (1)
−Removed: 11,242,185 170,651 6.04 % 11,025,222 163,353 5.96 %
−Removed: Mortgage-backed securities 2,623,399 16,498 2.50 % 2,672,187 16,850 2.54 %
−Removed: Other securities 943,310 11,120 4.69 % 958,809 11,181 4.69 %
−Removed: Interest-bearing deposits with banks 51,604 493 3.80 % 58,022 578 4.01 %
−Removed: FHLB stock 16,664 412 9.84 % 21,080 365 6.96 %
−Removed: Total investment securities 3,634,977 28,523 3.12 % 3,710,098 28,974 3.14 %
−Removed: Total interest-earning assets 14,877,162 199,174 5.33 % 14,735,320 192,327 5.25 %
−Removed: Non-interest-earning assets 981,290 926,411
−Removed: Total assets $ 15,858,452 $ 15,661,731
−Removed: Interest-bearing checking accounts $ 2,295,723 9,497 1.65 % $ 2,156,214 7,621 1.42 %
−Removed: Savings accounts 3,268,647 19,299 2.35 % 3,147,522 17,200 2.20 %
−Removed: Money market accounts 1,611,543 9,184 2.27 % 1,659,327 9,124 2.21 %
−Removed: Certificates of deposit 1,540,637 15,805 4.08 % 1,503,597 14,905 3.99 %
−Removed: Total interest-bearing deposits 8,716,550 53,785 2.45 % 8,466,660 48,850 2.32 %
−Removed: Non-interest-bearing deposits 4,601,755 — — % 4,634,738 — — %
−Removed: Total deposits 13,318,305 53,785 1.61 % 13,101,398 48,850 1.50 %
−Removed: Other interest-bearing liabilities:
−Removed: FHLB advances 161,413 2,263 5.58 % 259,549 3,621 5.61 %
−Removed: Other borrowings 159,439 1,147 2.86 % 175,518 1,160 2.66 %
−Removed: Junior subordinated debentures and subordinated notes 179,075 2,971 6.60 % 179,178 2,961 6.65 %
−Removed: Total borrowings 499,927 6,381 5.08 % 614,245 7,742 5.07 %
−Removed: Total funding liabilities 13,818,232 60,166 1.73 % 13,715,643 56,592 1.66 %
−Removed: Other non-interest-bearing liabilities (2)
−Removed: 311,803 294,794
−Removed: Total liabilities 14,130,035 14,010,437
−Removed: Shareholders’ equity 1,728,417 1,651,294
−Removed: Total liabilities and shareholders’ equity $ 15,858,452 $ 15,661,731
−Removed: Net interest income/rate spread (tax equivalent) $ 139,008 3.60 % $ 135,735 3.59 %
−Removed: Net interest margin (tax equivalent) 3.72 % 3.70 %
−Removed: Reconciliation to reported net interest income:
−Removed: Adjustments for taxable equivalent basis (3,333) (3,189)
−Removed: Net interest income and margin, as reported $ 135,675 3.63 % $ 132,546 3.62 %
−Removed: Additional Key Financial Ratios:
−Removed: Return on average assets 1.13 % 1.02 %
−Removed: Adjusted return on average assets (4)
−Removed: 1.13 % 1.04 %
−Removed: Return on average equity 10.39 % 9.69 %
−Removed: Adjusted return on average equity (4)
−Removed: 10.39 % 9.83 %
−Removed: Average equity/average assets 10.90 % 10.54 %
−Removed: Average interest-earning assets/average interest-bearing liabilities 161.42 % 162.27 %
−Removed: Average interest-earning assets/average funding liabilities 107.66 % 107.43 %
−Removed: Non-interest income/average assets 0.45 % 0.44 %
−Removed: Non-interest expense/average assets 2.42 % 2.52 %
−Removed: Efficiency ratio 62.63 % 65.53 %
−Removed: Adjusted efficiency ratio (4)
−Removed: 61.27 % 63.60 %
−Removed: (1) Average balances include loans accounted for on a nonaccrual basis and accruing loans 90 days or more past due.
−Removed: Amortization of net deferred loan fees/costs is included with interest on loans.
−Removed: (2) Average other non-interest-bearing liabilities include fair value adjustments related to junior subordinated debentures.
−Removed: (3) Tax-exempt income is calculated on a tax equivalent basis.
−Removed: The tax equivalent yield adjustment to interest earned on loans was $2.3 million and $2.2 million for the quarters ended September 30, 2024 and June 30, 2024, respectively.
−Removed: The tax equivalent yield adjustment to interest earned on tax exempt securities was $1.0 million for both the quarter ended September 30, 2024 and June 30, 2024.
−Removed: (4) Represents non-GAAP financial measures.
−Removed: See non-GAAP financial measure reconciliations presented above following Third Quarter 2024 Highlights.
−Removed: Nine Months Ended September 30, 2024 Nine Months Ended September 30, 2023
Average Balance Interest and Dividends Yield / Cost (3)
−Removed: Average Balance Interest and Dividends Yield / Cost (3)
Interest-earning assets:
35 unchanged sentences
Adjustments for taxable equivalent basis (3,272) (3,263) (3,051)
−Removed: Net interest income and margin $ 401,180 3.63 % $ 437,596 3.99 %
+Added: Net interest income and margin, as reported $ 141,083 3.83 % $ 140,536 3.74 % $ 132,959 3.65 %
Additional Key Financial Ratios:
17 unchanged sentences
(3) Tax-exempt income is calculated on a tax equivalent basis.
−Removed: The tax equivalent yield adjustment to interest earned on loans was $6.5 million and $5.4 million for the nine months ended September 30, 2024 and 2023, respectively.
−Removed: The tax equivalent yield adjustment to interest earned on tax exempt securities was $3.1 million and $3.4 million for the nine months ended September 30, 2024 and 2023, respectively.
+Added: The tax equivalent yield adjustment to interest earned on loans was $2.2 million for both the quarters ended March 31, 2025 and December 31, 2024, and $2.0 million for the quarter ended March 31, 2024.
+Added: The tax equivalent yield adjustment to interest earned on tax exempt securities was $1.0 million for the quarters ended March 31, 2025, December 31, 2024, and March 31, 2024.
(4) Represents non-GAAP financial measures.
−Removed: See non-GAAP financial measure reconciliations presented above following Third Quarter 2024 Highlights.
+Added: See non-GAAP financial measure reconciliations presented above following First Quarter 2025 Highlights.
Provision and Allowance for Credit Losses .
4 unchanged sentences
Quarters Ended
−Removed: Nine Months Ended
−Removed: CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - LOANS Sep 30, 2024 Jun 30, 2024 Sep 30, 2023 Sep 30, 2024 Sep 30, 2023
+Added: CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - LOANS Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
Balance, beginning of period $ 155,521 $ 154,585 $ 149,643
2 unchanged sentences
Commercial real estate 57 1,215 1,389
−Removed: Construction and land — — 29 — 29
One- to four-family residential 188 124 16
8 unchanged sentences
Commercial business (3,301) (3,595) (1,809)
−Removed: Agricultural business, including secured by farmland — — (564) — (564)
Consumer (364) (429) (569)
(3,678) (4,033) (2,378)
−Removed: Net charge-offs (230) (245) (663) (402) (1,781)
+Added: Net (charge-offs) recoveries (2,747) (2,283) 73
Balance, end of period $ 157,323 $ 155,521 $ 151,140
−Removed: Net charge-offs / Average loans receivable (0.002) % (0.002) % (0.006) % (0.004) % (0.017) %
+Added: Net (charge-offs) recoveries / Average loans receivable (0.024) % (0.020) % 0.001 %
Allowance for credit losses - loans as a percentage of total loans 1.38 % 1.37 % 1.39 %
The provision for credit losses - loans reflects the amount required to maintain the allowance for credit losses - loans at an appropriate level based upon management’s evaluation of the adequacy of collective and individual loss reserves.
−Removed: During both the quarter ended September 30, 2024 and the preceding quarter, we recorded a provision for credit losses - loans of $2.0 million.
−Removed: The provision for credit losses - loans for the current quarter primarily reflects an increase in the reserve for collateral dependent loans.
−Removed: The provision for credit losses - loans for the preceding quarter primarily reflected loan growth and an increase in the reserve for collateral dependent loans.
−Removed: Future assessments of the expected credit losses will not only be impacted by changes in both the composition and amount of loans, and to the reasonable and supportable forecast, but will also include an updated assessment of qualitative factors, as well as consideration of any required changes in the reasonable and supportable forecast reversion period.
+Added: During the quarter ended March 31, 2025, we recorded a provision for credit losses - loans of $4.5 million, compared to a provision for credit losses - loans of $3.2 million during the preceding quarter.
+Added: The provision for credit losses for the current quarter primarily reflected loan growth in the construction portfolio and to a lesser extent risk rating migration and qualitative adjustments applied to address economic uncertainty.
+Added: The provision for credit losses for the preceding quarter primarily reflected risk rating downgrades as well as growth in loan balances.
+Added: Future provisions for credit losses will continue to be influenced by changes in the amount and composition of the loan portfolio, updates to the reasonable and supportable forecast of future economic conditions, revisions to qualitative factor assessments, and any necessary changes to the reversion period applied in estimating expected credit losses.
The provision for credit losses - unfunded loan commitments reflects the amount required to maintain the allowance for credit losses - unfunded loan commitments at an appropriate level based upon management’s evaluation of the adequacy of collective and individual loss reserves.
1 unchanged sentence
Quarters Ended
−Removed: Nine Months Ended
−Removed: CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - UNFUNDED LOAN COMMITMENTS Sep 30, 2024 Jun 30, 2024 Sep 30, 2023 Sep 30, 2024 Sep 30, 2023
+Added: CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - UNFUNDED LOAN COMMITMENTS Mar 31, 2025 Dec 31, 2024 Mar 31, 2024
Balance, beginning of period $ 13,562 $ 13,765 $ 14,484
−Removed: (Recapture) provision for credit losses - unfunded loan commitments (262) 430 346 (719) 289
+Added: Recapture of provision for credit losses - unfunded loan commitments (1,400) (203) (887)
Balance, end of period $ 12,162 $ 13,562 $ 13,597
−Removed: The decrease in the allowance for credit losses - unfunded loan commitments for the current quarter primarily reflects a decrease in unfunded loan commitments in the one- to four-family construction, construction, land and land development, and agricultural loan portfolios.
+Added: The decrease in the allowance for credit losses - unfunded loan commitments for the current quarter primarily reflects a decrease in unfunded loan commitments in the construction portfolio.
Non-interest Income.
The following table presents the key components of non-interest income for the periods indicated (dollars in thousands):
−Removed: Quarters Ended Nine Months Ended
−Removed: Sep 30, 2024 Jun 30, 2024 Change Amount Change Percent Sep 30, 2024 Sep 30, 2023 Change Amount Change Percent
+Added: Quarters Ended
+Added: Mar 31, 2025 Dec 31, 2024 Change Amount Change Percent Mar 31, 2024 Change Amount Change Percent
Deposit fees and other service charges $ 10,769 $ 11,018 $ (249) (2) % $ 11,022 $ (253) (2) %
3 unchanged sentences
18,793 19,599 (806) (4) 17,486 1,307 7
−Removed: Net loss on sale of securities — (562) 562 (100) (5,465) (14,436) 8,971 (62)
−Removed: Net change in valuation of financial instruments carried at fair value 39 (190) 229 nm (1,143) (4,357) 3,214 (74)
+Added: Net gain (loss) on sale of securities — 275 (275) (100) (4,903) 4,903 (100)
+Added: Net change in valuation of financial instruments carried at fair value 315 161 154 96 (992) 1,307 (132)
Total non-interest income $ 19,108 $ 20,035 $ (927) (5) % $ 11,591 $ 7,517 65 %
−Removed: nm = not meaningful
−Removed: The increase in non-interest income during the current quarter compared to the preceding quarter was primarily due to decreases in the net loss recognized on the sale of securities and the net loss recognized on the valuation of financial instruments carried at fair value, partially offset by a decrease in miscellaneous income.
−Removed: The increase in non-interest income for the nine months ended September 30, 2024, compared to the same period a year earlier was primarily due to decreases in the net loss recognized on the sale of securities and the net loss recognized on the valuation of financial instruments carried at fair value, as well as increases in revenue from mortgage banking operations and miscellaneous income.
−Removed: Revenue from mortgage banking operations increased $174,000 for the quarter ended September 30, 2024, compared to the preceding quarter and increased $2.1 million for the nine months ended September 30, 2024, compared to the same period a year earlier.
−Removed: The volume of one- to four-family loans sold during the current quarter and the nine months ended September 30, 2024 increased relative to the comparable periods, although overall volumes remained low due to reduced refinancing and purchase activity in the current rate environment.
−Removed: The increase was also impacted by increases in the pricing on the one- to four-family loans sold during the current period.
−Removed: The current year also benefited from a $284,000 gain related to the sale of $19.8 million of one- to four-family portfolio loans during the second quarter of 2024.
−Removed: In addition, the prior year period reflected a downward lower of cost or market adjustment on multifamily loans held for sale.
−Removed: In 2023, the Bank discontinued the origination of multifamily loans for sale into the secondary market.
−Removed: All of the multifamily loans held for sale were transferred to the held for investment loan portfolio and the related lower of cost or market adjustment was reversed in the fourth quarter of 2023.
−Removed: Gains on sales of one- to four-family loans resulted in income of $2.1 million and $5.4 million for the quarter and nine months ended September 30, 2024, respectively, compared to $2.0 million in the preceding quarter, and $4.2 million for the nine months ended September 30, 2023.
−Removed: Home purchase activity accounted for 88% of one- to four-family mortgage loan originations in the third quarter of 2024, compared to 89% in the preceding quarter.
−Removed: Miscellaneous income increased for the nine months ended September 30, 2024, compared to the same period a year earlier, primarily as a result of an increase in the gain on sale of SBA loans.
−Removed: There were no sales of securities during the current quarter and the net loss on the sale of securities recognized for the prior periods reflected strategic sales of securities to minimize the impact of increasing rates on our securities portfolio.
−Removed: The net loss for fair value adjustments for changes in the valuation of financial instruments carried at fair value for the prior quarter and the nine months ended September 30, 2023 were due to declines in the current market valuation of limited partnership investments.
−Removed: The net loss for fair value adjustments for changes in the valuation of financial instruments carried at fair value for the nine months ended September 30, 2023 was also impacted by declines in the market valuation of investment securities held for trading.
+Added: The decrease in non-interest income during the current quarter compared to the preceding quarter was primarily due to decreases in mortgage banking operations revenue and miscellaneous income, partially offset by an increase in bank owned life insurance income.
+Added: The increase in non-interest income during the current quarter compared to the prior year quarter was primarily due to a decrease in the net loss recognized on the sale of securities and an increase in the fair value adjustments on financial instruments carried at fair value during the current quarter
+Added: Revenue from mortgage banking operations decreased $583,000 for the quarter ended March 31, 2025, compared to the preceding quarter and increased $768,000 compared to the same period a year earlier.
+Added: The volume of one- to four-family loans sold during the current quarter decreased compared to the preceding quarter and increased compared to the prior year quarter.
+Added: While the volume of one- to four-family loans sold increased compared to the prior year quarter, overall volumes remained low due to reduced refinancing and purchase activity in the current interest rate environment.
+Added: The decrease in mortgage banking operations revenue from the preceding quarter reflects a $508,000 gain related to the pooled loan sale of $34.8 million of one- to four-family loans during the fourth quarter of 2024 and a decrease in the market value of our hedge, partially offset by an increase in the pricing of one- to four-family loans sold during the current quarter.
+Added: Gains on sales of one- to four-family loans totaled $2.1 million for the quarter ended March 31, 2025, compared to $2.6 million in the preceding quarter and $1.3 million for the three months ended March 31, 2024.
+Added: Home purchase activity accounted for 84% of one- to four-family residential mortgage loan originations in the first quarter of 2025, compared to 79% in the preceding quarter.
+Added: Bank owned life insurance income increased for the three months ended March 31, 2025, compared to the preceding and prior year quarters due to the receipt of death benefit proceeds during the current quarter.
+Added: Miscellaneous income decreased for the three months ended March 31, 2025, compared to the prior quarter, primarily due to a gain recognized on the sale of a non-performing loan during the fourth quarter of 2024, and increased compared to same period a year earlier, primarily as a result of an increase in the gain on sale of SBA loans.
+Added: The net loss on the sale of securities recognized for the three months ended March 31, 2024 reflected strategic sales of securities to minimize the impact of increasing rates on our securities portfolio.
+Added: The net loss for fair value adjustments for changes in the valuation of financial instruments carried at fair value for the three months ended March 31, 2024 were due to declines in the current market valuation of limited partnership investments.
Non-interest Expense.
The following table represents key elements of non-interest expense for the periods indicated (dollars in thousands):
−Removed: Quarters Ended Nine Months Ended
−Removed: Sep 30, 2024 Jun 30, 2024 Change Amount Change Percent.
−Removed: Sep 30, 2024 Sep 30, 2023 Change Amount Change Percent
+Added: Quarters Ended
+Added: Mar 31, 2025 Dec 31, 2024 Change Amount Change Percent.
+Added: Mar 31, 2024 Change Amount Change Percent
Salary and employee benefits $ 64,857 $ 62,523 $ 2,334 4 % $ 62,369 $ 2,488 4 %
11 unchanged sentences
Total non-interest expense $ 101,259 $ 99,478 $ 1,781 2 % $ 97,641 $ 3,618 4 %
−Removed: The decrease in non-interest expense for the current quarter compared to the prior quarter reflects a decrease in salary and employee benefits.
−Removed: The increase in non-interest expense for the nine months ended September 30, 2024, compared to the same period a year earlier primarily reflects increases in salary and employee benefits as well as payment and card processing services expense, partially offset by a decrease in professional and legal expenses.
−Removed: Salary and employee benefits increased for the nine months ended September 30, 2023, primarily as a result of normal annual salary and wage increases and an increase in loan production related commission expense.
−Removed: Other notable changes included payment and card processing services expense, which increased for the nine months ended September 30, 2024, compared to the same period a year earlier, primarily due to an increase in online banking costs and fraud losses.
−Removed: Professional and legal expense decreased for the nine months ended September 30, 2024, compared to the same period a year ago primarily due to a reduction in legal and consulting expenses as well as one-time reductions in litigation settlement costs.
+Added: The increase in non-interest expense for the current quarter compared to the prior quarter reflects an increase in salary and employee benefits and a decrease in capitalized loan costs, partially offset by a decrease in advertising and marketing expenses.
+Added: The increase in non-interest expense for the three months ended March 31, 2025, compared to the same period a year earlier primarily reflects increases in salary and employee benefits and professional and legal expenses.
+Added: Salary and employee benefits increased compared to the prior quarter, primarily as a result of increased medical premiums expense, as well as payroll tax expense that typically increases in the first quarter due to the reset of payroll tax wage bases.
+Added: The increase compared to the same period a year earlier was primarily the result of normal salary and wage increases.
+Added: Advertising and marketing expense decreased for the quarter ended March 31, 2025, primarily due to decreases in printed media marketing and community development expenses.
+Added: Professional and legal expense decreased for the three months ended March 31, 2025, compared to the preceding quarter primarily due to a decrease in consultant and audit expenses due to the timing of these engagements.
+Added: The increase compared to the same period a year ago was primarily due to an increase in legal expenses as the prior period reflected a one-time true-up.
Our efficiency ratio was 63.21% for the current quarter, compared to 61.95% in the preceding quarter.
Our adjusted efficiency ratio, a non-GAAP financial measure, was 62.18% for the current quarter, compared to 60.74% in the preceding quarter.
−Removed: The efficiency ratio for the current quarter reflects an increase in total revenues in addition to the decrease in non-interest expenses.
−Removed: See non-GAAP financial measure reconciliations presented above under “Third Quarter 2024 Financial Highlights.”
+Added: The efficiency ratio for the current quarter reflects a decrease in total revenues in addition to the increase in non-interest expenses.
+Added: See non-GAAP financial measure reconciliations presented above under “First Quarter 2025 Financial Highlights.”
Income Taxes.
−Removed: For the quarter ended September 30, 2024, we recognized $10.6 million in income tax expense for an effective tax rate of 19.0%, which reflects our blended statutory tax rate reduced by the effect of tax-exempt income, certain tax credits, and tax benefits related to restricted stock vesting.
+Added: For the quarter ended March 31, 2025, we recognized $10.7 million in income tax expense for an effective tax rate of 19.1%, which reflects our blended statutory tax rate reduced by the effect of tax-exempt income, certain tax credits, and tax benefits related to restricted stock vesting.
Our statutory income tax rate is 23.7%, representing a statutory federal income tax rate of 21.0% and apportioned effects of the state income tax rates.
−Removed: For the quarter ended June 30, 2024, we recognized $9.5 million in income tax expense for an effective tax rate of 19.2%.
−Removed: For the nine months ended September 30, 2024, we recognized $28.9 million in income tax expense for an effective tax rate of 19.1%, compared to $32.8 million in income tax expense for an effective tax rate of 18.9% for the same period in the prior year.
+Added: For the quarter ended December 31, 2024, we recognized $11.7 million in income tax expense for an effective tax rate of 20.1%.
+Added: For the three months ended March 31, 2024, we recognized $8.8 million in income tax expense for an effective tax rate of 19.0%.
Asset Quality
2 unchanged sentences
Non-Performing Assets:
−Removed: Non-performing assets totaled $45.2 million, or 0.28% of total assets, at September 30, 2024, compared to $30.1 million, or 0.19% of total assets, at December 31, 2023.
−Removed: Our allowance for credit losses - loans was $154.6 million, or 359% of non-performing loans, at September 30, 2024, compared to $149.6 million, or 506% of non-performing loans, at December 31, 2023.
+Added: Non-performing assets totaled $42.7 million, or 0.26% of total assets, at March 31, 2025, compared to $39.6 million, or 0.24% of total assets, at December 31, 2024.
+Added: Our allowance for credit losses - loans was $157.3 million, or 404% of non-performing loans, at March 31, 2025, compared to $155.5 million, or 421% of non-performing loans, at December 31, 2024.
The following table sets forth information with respect to our non-performing assets at the dates indicated (dollars in thousands):
−Removed: September 30, 2024 December 31, 2023 September 30, 2023
+Added: March 31, 2025 December 31, 2024 March 31, 2024
Nonaccrual Loans:
9 unchanged sentences
Secured by real estate:
−Removed: Commercial 2,258 — —
Construction and land — — 286
2 unchanged sentences
Consumer 155 35 —
−Removed: 3,958 2,745 2,044
Total non-performing loans 38,959 36,956 29,489
REO, net 3,468 2,367 448
+Added: Other repossessed assets held for sale 300 300 —
Total non-performing assets $ 42,727 $ 39,623 $ 29,937
2 unchanged sentences
Loans 30-89 days past due and on accrual $ 37,339 $ 26,824 $ 19,649
−Removed: For the nine months ended September 30, 2024, interest income was reduced by $1.6 million as a result of nonaccrual loan activity, which included the reversal of $569,000 of accrued interest as of the date the loan was placed on nonaccrual.
−Removed: There was no interest income recognized on nonaccrual loans for the nine months ended September 30, 2024.
+Added: For the three months ended March 31, 2025, interest income was reduced by $870,000 as a result of nonaccrual loan activity, which included the reversal of $263,000 of accrued interest as of the date the loan was placed on nonaccrual.
+Added: There was no interest income recognized on nonaccrual loans for the three months ended March 31, 2025.
The following table presents the Company’s portfolio of loans by risk grade at the dates indicated (in thousands):
−Removed: September 30, 2024 December 31, 2023 September 30, 2023
+Added: March 31, 2025 December 31, 2024 March 31, 2024
Pass $ 11,207,852 $ 11,118,744 $ 10,731,015
2 unchanged sentences
Total $ 11,438,796 $ 11,354,656 $ 10,869,096
−Removed: The increase in special mention and substandard from December 31, 2023, primarily reflects loan downgrades, partially offset by paydowns and payoffs of substandard loans.
+Added: As of March 31, 2025, total substandard loans primarily consisted of loans within the commercial business, commercial real estate and agricultural loan segments.
Liquidity and Capital Resources
2 unchanged sentences
Our primary investing activity is the origination of loans and, in certain periods, the purchase of securities or loans.
−Removed: During the nine months ended September 30, 2024 and 2023, our loan originations, including originations of loans held for sale, exceeded our loan repayments by $744.9 million and $666.6 million, respectively.
−Removed: There were $4.7 million of loan purchases during the nine months ended September 30, 2024, and no loan purchases during the nine months ended September 30, 2023.
−Removed: During the nine months ended September 30, 2024 and 2023, we received proceeds of $276.8 million and $212.0 million, respectively, from the sale of loans.
−Removed: Securities purchased during the nine months ended September 30, 2024 and 2023 totaled $53.2 million and $54.2 million, respectively, and securities repayments, maturities and sales in those periods were $284.4 million and $508.7 million, respectively.
+Added: During the three months ended March 31, 2025 and 2024, our loan originations, including originations of loans held for sale, exceeded our loan repayments by $186.2 million and $120.4 million, respectively.
+Added: There were $10.8 million of loan purchases during the three months ended March 31, 2025, and $4.7 million loan purchases during the three months ended March 31, 2024.
+Added: During the three months ended March 31, 2025 and 2024, we received proceeds of $120.7 million and $71.5 million, respectively, from the sale of loans.
+Added: Securities purchased during the three months ended March 31, 2025 and 2024 totaled $9.8 million and $10.5 million, respectively, and securities repayments, maturities and sales in those periods were $52.9 million and $134.2 million, respectively.
Our primary financing activity is gathering deposits.
−Removed: Total deposits increased by $508.7 million during the nine months ended September 30, 2024, primarily due to an increase in core deposits.
−Removed: Core deposits were $12.02 billion at September 30, 2024, compared to $11.55 billion at December 31, 2023.
+Added: Total deposits increased by $78.9 million during the three months ended March 31, 2025, primarily due to an increase in core deposits.
+Added: Core deposits were $12.09 billion at March 31, 2025, compared to $12.01 billion at December 31, 2024.
Certificates of deposit are generally more vulnerable to competition and more price sensitive than other retail deposits and our pricing of those deposits varies significantly based upon our liquidity management strategies at any point in time.
−Removed: At September 30, 2024, certificates of deposit totaled $1.52 billion, or 11% of our total deposits, including $1.46 billion which were scheduled to mature within one year.
−Removed: The increase in certificates of deposit during 2024 was due to clients seeking higher yields moving excess non-interest-bearing funds to higher-yielding certificates of deposit.
+Added: At March 31, 2025, certificates of deposit totaled $1.50 billion, or 11% of our total deposits, including $1.45 billion which were scheduled to mature within one year.
While no assurance can be given as to future periods, historically, we have been able to retain a significant amount of our certificates of deposit as they mature.
−Removed: The Bank’s estimated uninsured deposits were $4.39 billion or 32% of total deposits at September 30, 2024, compared to $4.08 billion or 31% of total deposits at December 31, 2023.
−Removed: The estimated uninsured deposit calculation includes $318.0 million and $305.3 million of collateralized public deposits at September 30, 2024 and December 31, 2023, respectively.
−Removed: Estimated uninsured deposits also includes cash held by the Company of $69.2 million and $108.2 million at September 30, 2024 and December 31, 2023, respectively.
−Removed: Banner Bank’s estimated uninsured deposits, excluding collateralized public deposits and cash held at the holding company, were 29% of total deposits at September 30, 2024, compared to 28% of total deposits at December 31, 2023.
−Removed: We had $230.0 million of FHLB advances at September 30, 2024, compared to $323.0 million at December 31, 2023.
−Removed: Other borrowings decreased to $154.5 million at September 30, 2024 from $182.9 million at December 31, 2023.
−Removed: Subordinated notes, net of issuance costs decreased to $80.2 million at September 30, 2024, compared to $92.9 million at December 31, 2023, due to Banner Bank’s purchase of $3.5 million and $9.5 million of Banner’s subordinated debt during the first and third quarters of 2024, respectively.
+Added: We had $168.0 million of FHLB advances at March 31, 2025, compared to $290.0 million at December 31, 2024.
+Added: Other borrowings increased to $130.6 million at March 31, 2025 from $125.3 million at December 31, 2024.
+Added: Subordinated notes, net of issuance costs decreased to $80.4 million at March 31, 2025, compared to $80.3 million at December 31, 2024.
We must maintain an adequate level of liquidity to ensure the availability of sufficient funds to accommodate deposit withdrawals, to support loan growth, to satisfy financial commitments, and to take advantage of investment opportunities.
−Removed: During the nine months ended September 30, 2024, we used our sources of funds primarily to fund loan growth.
−Removed: At September 30, 2024, we had outstanding loan commitments totaling $4.01 billion, relating to undisbursed loans in process and unused credit lines.
+Added: During the three months ended March 31, 2025, we used our sources of funds primarily to fund loan growth.
+Added: At March 31, 2025, we had outstanding loan commitments totaling $3.89 billion, relating to undisbursed loans in process and unused credit lines.
While representing potential growth in the loan portfolio and lending activities, this level of commitments is proportionally consistent with our historical experience and does not represent a departure from normal operations.
2 unchanged sentences
We maintain credit facilities with the FHLB, which provide for advances that in the aggregate would equal the lesser of 45% of the Bank’s assets or adjusted qualifying collateral (subject to a sufficient level of ownership of FHLB stock).
−Removed: At September 30, 2024, under these credit facilities based on pledged collateral, the Bank had $3.23 billion of available credit capacity.
−Removed: Advances under these credit facilities totaled $230.0 million at September 30, 2024.
+Added: At March 31, 2025, under these credit facilities based on pledged collateral, the Bank had $3.14 billion of available credit capacity.
+Added: Advances under these credit facilities totaled $168.0 million at March 31, 2025.
In addition, the Bank has been approved for participation in the FRBSF’s Borrower-In-Custody program.
−Removed: Under this program, based on pledged collateral, the Bank had available lines of credit of approximately $1.53 billion as of September 30, 2024, subject to certain collateral requirements, namely the collateral type and risk rating of eligible pledged loans.
−Removed: We had no funds borrowed from the FRBSF at September 30, 2024 or December 31, 2023.
−Removed: At September 30, 2024, the Bank also had uncommitted federal funds line of credit agreements with other financial institutions totaling $125.0 million.
−Removed: No balances were outstanding under these agreements as of September 30, 2024 or December 31, 2023.
+Added: Under this program, based on pledged collateral, the Bank had available lines of credit of approximately $1.65 billion as of March 31, 2025, subject to certain collateral requirements, namely the collateral type and risk rating of eligible pledged loans.
+Added: We had no funds borrowed from the FRBSF at March 31, 2025 or December 31, 2024.
+Added: At March 31, 2025, the Bank also had uncommitted federal funds line of credit agreements with other financial institutions totaling $125.0 million.
+Added: No balances were outstanding under these agreements as of March 31, 2025 or December 31, 2024.
Availability of lines is subject to federal funds balances available for loan and continued borrower eligibility.
2 unchanged sentences
Banner is a separate legal entity from the Bank and, on a stand-alone level, must provide for its own liquidity, and pay its own operating expenses and cash dividends.
−Removed: At September 30, 2024, Banner (on an unconsolidated basis) had liquid assets of $69.5 million.
−Removed: During the quarter ended June 30, 2024, Banner and the Bank entered into an intercompany loan agreement for $50.0 million, which reduced Banner’s cash balance while maintaining liquidity with the note receivable from the Bank.
−Removed: The note has a term of one year, automatically renewable each quarter.
−Removed: The note eliminates upon consolidation.
+Added: At March 31, 2025, Banner (on an unconsolidated basis) had liquid assets of $84.2 million.
+Added: At March 31, 2025, Banner had an intercompany loan agreement with the Bank of $50.0 million.
+Added: The note receivable from the Bank has a rolling one-year term, automatically renewed each quarter, and is eliminated upon consolidation.
Banner’s primary sources of funds consist of capital raised through dividends or capital distributions from the Bank, although there are regulatory restrictions on the ability of the Bank to pay dividends.
1 unchanged sentence
Our current quarterly common stock dividend rate is $0.48 per share, as approved by our Board of Directors, which we believe is a dividend rate per share which enables us to balance our multiple objectives of managing and investing in the Bank, and returning a substantial portion of our cash to our shareholders.
−Removed: Assuming continued dividend payments during 2024 at this rate of $0.48 per share, our average total dividend paid each quarter would be approximately $16.5 million based on the number of outstanding shares at September 30, 2024.
+Added: Assuming continued dividend payments during 2025 at this rate of $0.48 per share, our average total dividend paid each quarter would be approximately $16.6 million based on the number of outstanding shares at March 31, 2025.
As noted below, Banner Corporation and its subsidiary bank continued to maintain capital levels in excess of the requirements to be categorized as “Well-Capitalized” under applicable regulatory standards.
−Removed: During the nine months ended September 30, 2024, total shareholders’ equity increased $141.0 million, to $1.79 billion or 11.08% of total assets.
−Removed: At September 30, 2024, tangible common shareholders’ equity, which excludes goodwill and other intangible assets, was $1.42 billion, or 8.96% of tangible assets.
+Added: During the three months ended March 31, 2025, total shareholders’ equity increased $59.1 million, to $1.83 billion or 11.34% of total assets.
+Added: At March 31, 2025, tangible common shareholders’ equity, which excludes goodwill and other intangible assets, was $1.46 billion, or 9.23% of tangible assets.
Tangible common shareholders’ equity represents a non-GAAP financial measure.
−Removed: See, non-GAAP financial measure reconciliations presented above under “Third Quarter 2024 Financial Highlights.”
+Added: See, non-GAAP financial measure reconciliations presented above under “First Quarter 2025 Financial Highlights.”
Capital Requirements
5 unchanged sentences
The FDIC requires the Bank to maintain minimum capital ratios of total capital, tier 1 capital, and common equity tier 1 capital to risk-weighted assets as well as tier 1 leverage capital to average assets.
−Removed: In addition to the minimum capital ratios, the Bank has to maintain a capital conservation buffer consisting of additional common equity tier 1 capital greater than 2.5% of risk-weighted assets above the required minimum levels in order to avoid limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses.
−Removed: At September 30, 2024, Banner and the Bank each exceeded all regulatory capital requirements to be “well capitalized.”
−Removed: The actual regulatory capital ratios calculated for Banner Corporation and Banner Bank as of September 30, 2024, along with the minimum capital amounts and ratios, were as follows (dollars in thousands):
+Added: In addition to the minimum capital ratios, the Bank must to maintain a capital conservation buffer consisting of additional common equity tier 1 capital greater than 2.5% of risk-weighted assets above the required minimum levels in order to avoid limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses.
+Added: At March 31, 2025, Banner and the Bank each exceeded all regulatory capital requirements to be “well capitalized.”
+Added: The actual regulatory capital ratios calculated for Banner Corporation and Banner Bank as of March 31, 2025, along with the minimum capital amounts and ratios, were as follows (dollars in thousands):
Actual Minimum to be Categorized as “Adequately Capitalized” Minimum to be Categorized as “Well-Capitalized”
10 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.