Category: Politics

  • MIL-OSI United Kingdom: Polluting water bosses face up to two years in prison

    Source: United Kingdom – Government Statements

    Press release

    Polluting water bosses face up to two years in prison

    New laws in force today mark the toughest sentencing powers against law-breaking water executives in history.

    • Powers introduced could see water bosses who cover up illegal sewage spills sent to prison for two years.  
    • New measures will force water companies to end their disgraceful behaviour and clean up our rivers, lakes and seas for good. 

    Water company bosses could face up to two years in prison due to new powers in force today (Friday 25 April 2025).  

    The new powers, delivered by the Government’s landmark Water (Special Measures) Act 2025, mean water executives who cover up or hide illegal sewage spills can now be locked up.  

    No prison sentences have been handed to water executives since privatisation despite widespread illegal sewage discharges into rivers, lakes and seas. These new, tougher penalties are essential because some water companies have obstructed investigations, failing to hand over vital evidence related to illegal sewage discharges. This has prevented crackdowns against law-breaking water companies.  

    The new measures deliver on the Government’s promise to bring tougher criminal charges against lawbreakers in the water industry. As part of the Government’s Plan for Change, the threat of imprisonment will act as a powerful deterrent as water companies invest in upgrading broken water infrastructure and clean up our rivers, lakes and seas for good.  

    Environment Secretary Steve Reed said: 

    Bosses must face consequences if they commit crimes. There must be accountability. 

    From today, there will be no more hiding places.  

    As part of the Plan for Change, water companies must now focus on cleaning up our rivers, lakes and seas for good.

    In addition, new powers will mean that the polluters will pay for the cost of criminal investigations into wrongdoing. Authorities will now recover the costs of their enforcement activity, with the Environment Agency currently consulting on how they will use the powers.    

    The payment of bonuses to water bosses will also be banned if they fail to meet high standards to protect the environment, their consumers, and their company’s finances.  

    Philip Duffy, Chief Executive of the Environment Agency said: 

    The Water (Special Measures) Act was a crucial step in making sure water companies take full responsibility for their impact on the environment.   

    The tougher powers we have gained though this legislation will allow us, as the regulator, to close the justice gap, deliver swifter enforcement action and ultimately deter illegal activity. 

    Alongside this, we’re modernising and expanding our approach to water company inspections – and it’s working. More people, powers, better data and inspections are yielding vital evidence so that we can reduce sewage pollution, hold water companies to account and protect the environment.

    The Government will continue to reform the water sector in order to clean up our rivers, lakes and seas once and for all.  

    Alongside this, £104 billion of private sector investment has been secured to upgrade and build new water infrastructure across the country, supporting the building of 1.5 million new homes, creating thousands of jobs and powering new industries such as gigafactories and data centres as part of the government’s Plan for Change.   

    Notes to editors:  

    Criminal Liability  

    • Until now, water regulators have faced significant challenges gathering evidence for prosecutions due to obstruction of their investigations.  

    • This is a criminal offence, but since privatisation, only three water company officials have been criminally prosecuted for obstruction by the EA without appeal and the maximum punishment was merely a fine – though no fines were issued.  

    • From now on, offences will be triable in both the Crown and Magistrates’ Courts and imprisonment will act as a powerful deterrent, bringing water regulation powers in line with other sectors, such as those covering fraud or health and safety investigations. 

     The new provisions enable: 

    • courts to include imprisonment as a sanction when investigations by water regulators (the Environment Agency, Natural Resources Wales and the Drinking Water Inspectorate) have been obstructed;

    • obstruction offences to be heard in the Crown Court;

    • directors and executives to be prosecuted where obstruction occurs with their consent, connivance or neglect.  

    Previously: 

    • obstructing regulators’ investigations was not always punishable by imprisonment;

    • cases could not always be heard in the Crown Court;

    • there were no straightforward routes for prosecuting directors or executives where obstruction was committed with their consent or connivance, or was attributable to their neglect.    

    The Water Special Measures Act received Royal Assent in February – see press release here: New law to ban bonuses for polluting water bosses – GOV.UK 

    Further detail on the measures in the Act can be found in the Policy Statement here: Water (Special Measures) Act: policy statement – GOV.UK 

    Action on water  

    • The government has taken immediate action to reset the water sector. Change is being delivered three stages:  

    • In his first week in office, the Secretary of State for Environment Food and Rural Affairs Steve Reed announced a series of initial steps. This included immediately ringfencing funding for vital water infrastructure so that it can only be spent on upgrades benefiting the environment – not diverted for bonuses, dividends or salary increases. Where money is not spent, we will force water companies to return it to customers.  

    • Second, the landmark Water (Special Measures) Act 2025 has been signed into law, marking the most significant increase in enforcement powers in a decade. The Act will:  

    • Strengthen regulation to ensure water bosses face personal criminal liability for lawbreaking.  

    • Give the water regulator new powers to ban the payment of bonuses if environmental standards are not met.  

    • Boost accountability for water executives through a new ‘code of conduct’ for water companies, so customers can summon board members and hold executives to account.  

    • Introduce new powers to bring automatic and severe fines.  

    • Require water companies to install real-time monitors at every emergency sewage outlet with data independently scrutinised by the water regulators.  

    • Third, the Independent Commission into the water sector, launched by the UK and Welsh governments, is carrying out the largest review of the industry since privatisation. Its recommendations, due later this summer, will shape further laws to attract the investment needed to clean up our waterways, accelerate infrastructure delivery and restore public confidence in the sector.  

    • The next five years will see £104 billion in private sector investment into the water industry—the largest since privatisation. This will drive forward 150 major infrastructure projects, creating over 30,000 jobs across the country, and support the building of 1.5 million new homes and powering new industries such as gigafactories and data centres.  

    • The Secretary of State and Water Minister recently completed a ‘Things Can Only Get Cleaner’ tour to see where this investment will underpin the building of new homes, create jobs and turbocharge local economies around the country – a cornerstone of the government’s Plan for Change. This included a pledge to end sewage discharges into the iconic lake Windermere.

    Updates to this page

    Published 24 April 2025

    MIL OSI United Kingdom

  • MIL-OSI United Kingdom: Foreign Secretary statement on the situation in El Fasher, Sudan: 24 April 2025

    Source: United Kingdom – Government Statements

    Press release

    Foreign Secretary statement on the situation in El Fasher, Sudan: 24 April 2025

    The Foreign Secretary has issued a statement following reports of violence in and around El Fasher, Sudan.

    Foreign Secretary, David Lammy said:

    The reports of violence in and around the city of El Fasher are appalling.

    Last week, the UK gathered the international community in London to call for an end to the suffering of the Sudanese people. Yet some of the violence in Darfur has shown the hallmarks of ethnic cleansing and may amount to crimes against humanity. Both sides must de-escalate urgently in Darfur and implement UNSCR2736, which calls on the RSF to halt its siege of El Fasher and bring an immediate stop to the fighting.

    The UK will continue to use all tools available to us to us to hold those responsible for atrocities to account.

    The warring parties have a responsibility to end this suffering. There are no exceptions to the laws of war: both the Sudanese Armed Forces and the Rapid Support Forces agreed at Jeddah to protect civilians and facilitate humanitarian access.

    It is their responsibility to enforce these commitments, through command and control of their fighters and aligned militias. The RSF must immediately cease attacks on civilians, and the SAF and allied Joint Forces must allow safe passage for civilians to reach safety.

    Hundreds of thousands have been displaced; yet many more in Zamzam IDP camp and El Fasher are being blocked from fleeing this violence by the warring parties. They must be free to seek safety wherever they think best and be protected as they do so.

    The warring parties must give humanitarian actors the security guarantees needed to  deliver aid rapidly, safely and at scale, including through a 72-hour pause in fighting. This must be through transparent notification of movement, rather than permission, throughout North Darfur and beyond.

    Media enquiries

    Email newsdesk@fcdo.gov.uk

    Telephone 020 7008 3100

    Contact the FCDO Communication Team via email (monitored 24 hours a day) in the first instance, and we will respond as soon as possible.

    Updates to this page

    Published 24 April 2025

    MIL OSI United Kingdom

  • MIL-OSI USA News: Fact Sheet: President Donald J. Trump Strengthens Probationary Periods to Improve the Federal Service

    Source: The White House

    ENHANCING FEDERAL WORKFORCE ACCOUNTABILITY: Today, President Donald J. Trump signed an Executive Order strengthening probationary periods in the federal service.

    • The Order establishes a new Civil Service Rule XI to govern probationary and trial periods for federal employees, superseding existing civil service regulations that limited agency discretion in evaluating such employees.
    • Instead of these employees becoming tenured civil servants by default, Rule XI requires agencies to affirmatively certify that finalizing their appointment after their probationary or trial period concludes advances the public interest.
      • This fulfills a longstanding Merit Systems Protection Board recommendation.
    • The Order mandates that agencies utilize probationary and trial periods (typically one year) to assess employees’ fitness and alignment with agency needs and the public interest.
    • It creates an individualized review process, requiring a designee of agency leadership to meet with probationary employees at least 60 days before their probationary period ends to discuss their performance and continued employment.
    • The Order allows the Office of Personnel Management (OPM) Director to establish an appeals process for probationary terminations in some circumstances.
    • The Order requires agencies to identify current probationary employees and designate evaluators within 15 days, ensuring accountability from the outset.

    ENSURING A HIGH-QUALITY FEDERAL WORKFORCE: President Trump believes a meaningful probationary process is essential to maintaining a merit-based federal workforce that serves the American people.

    • Probationary periods are a critical part of the hiring process to confirm an employee’s ability to perform their duties, yet agencies have underutilized this tool, resulting in the indefinite retention of underperforming staff.
    • The Government Accountability Office has documented that agencies often fail to screen out unsuitable employees during their probationary period, contrary to congressional intent in the Civil Service Reform Act of 1978.
    • Existing OPM regulations have hindered agencies by imposing unnecessary obstacles to terminating probationary employees and failing to require certification that continued employment benefits the public interest.
    • A high-quality, efficient federal workforce, dedicated to the public interest and no larger than necessary, is vital to serving taxpayers.
    • Strengthening probationary periods ensures federal employees are held to high standards.

    DRAINING THE SWAMP: The federal workforce must work for the American people, and thanks to President Trump, the federal bureaucracy is being held accountable.

    • Taxpayers will no longer be burdened by an oversized, unaccountable federal bureaucracy that fails to prioritize the public interest.
    • Last month, President Trump signed a Presidential Memorandum clarifying federal authority to take “suitability” actions against federal employees, ensuring accountability for bad conduct and preventing security risks both before and after appointment to federal service.
    • President Trump also signed the DOGE Workforce Optimization Executive Order to make the federal workforce more efficient and effective, significantly reducing the size of government.
    • This Executive Order builds on the President’s longstanding power to create Civil Service Rules to govern probationary periods in the federal government.

    MIL OSI USA News

  • MIL-OSI USA News: Fact Sheet: President Donald J. Trump Investigates Unlawful “Straw Donor” and Foreign Contributions in American Elections

    Source: The White House

    INVESTIGATING “STRAW” DONORS: Today, President Donald J. Trump signed a Presidential Memorandum to crack down on illegal “straw donor” and foreign contributions in American elections, following reports and congressional investigations regarding potentially unlawful activities through ActBlue and other online fundraising platforms.

    • The Memorandum directs the Attorney General to investigate and take appropriate action concerning allegations regarding the use of online fundraising platforms to make “straw” or “dummy” contributions and to make foreign contributions to U.S. political candidates and committees, all of which break the law.
    • Specifically, the Memorandum notes that a congressional investigation revealed significant fraud schemes using ActBlue and, over a 30-day period during the 2024 election cycle, hundreds of ActBlue donations from foreign IP addresses using prepaid cards, despite it being illegal for foreign nationals to contribute to U.S. elections.
    • It instructs the Attorney General to report the results of the investigation to the President, through the Counsel to the President. 

    PROTECTING AMERICAN DEMOCRACY: President Trump is taking action to address malign actors and foreign nationals who seek to illegally influence American elections, undermining the integrity of our electoral process.

    • Recently uncovered evidence suggests that online fundraising platforms are being used to launder excessive and prohibited contributions to political candidates and committees.
    • Bad actors have sought to evade Federal source and amount limitations by breaking down large contributions into smaller ones, often attributing them to numerous individuals without their consent or knowledge.
    • These “straw donations” are frequently made through “dummy” accounts, using methods such as gift cards or prepaid credit cards to avoid detection.
    • ActBlue has become notorious for its lax standards that enable unverified and fraudulent donations. 
    • A recent House of Representatives investigation found that ActBlue detected at least 22 “significant fraud campaigns” in recent years—nearly half of which had a foreign nexus.
      • Over a 30-day window during the 2024 election cycle, ActBlue detected 237 donations from foreign IP addresses using prepaid cards.
      • The investigation revealed that ActBlue trained employees to “look for reasons to accept contributions,” even in the face of suspicious activity.
    • Until recently, ActBlue accepted political contributions without requiring a card verification value (CVV), making it easy to contribute without identity verification.
      • Before addressing this issue in response to a congressional investigation, ActBlue tested whether this would hurt its fundraising.
    • Numerous state attorneys general have opened investigations into ActBlue over suspicious donations made through obscured identities and untraceable means.

    MAKING ELECTIONS SECURE AGAIN:  Voters deserve elections they can trust, and that confidence is being restored thanks to President Trump. 

    • President Trump is following through on his promise to secure our elections.
      • President Trump: “We’re going to fix our elections so that our elections are going to be honorable and honest.”
      • President Trump: “We will secure our elections, and they will be secure once and for all.”
    • President Trump recently signed an Executive Order to protect the integrity of American elections.
    • Unlike the Biden Administration, which prioritized political agendas over fair elections, President Trump is putting the American people back in charge.

    MIL OSI USA News

  • MIL-OSI: Provident Financial Services, Inc. Announces First Quarter Earnings and Declares Quarterly Cash Dividend

    Source: GlobeNewswire (MIL-OSI)

    ISELIN, N.J., April 24, 2025 (GLOBE NEWSWIRE) — Provident Financial Services, Inc. (NYSE:PFS) (the “Company”) reported net income of $64.0 million, or $0.49 per basic and diluted share for the three months ended March 31, 2025, compared to $48.5 million, or $0.37 per basic and diluted share, for the three months ended December 31, 2024 and $32.1 million, or $0.43 per basic and diluted share, for the three months ended March 31, 2024. Net income for the three months ended March 31, 2025 was negatively impacted by a $2.7 million write-down on a foreclosed property, partially offset by a $624,000 profit on fixed asset sales related to the consolidation of three branches. While there were no transaction costs related to our merger with Lakeland Bancorp, Inc. (“Lakeland”) for the 2025 period, these costs totaled $20.2 million for the three months ended December 31, 2024 and $2.2 million for the three months ended March 31, 2024, respectively.

    Anthony J. Labozzetta, President and Chief Executive Officer commented, “With the integration of Lakeland behind us, we are starting to see the benefits of the transaction come to fruition. We are very pleased with our first quarter financial results and encouraged by the promising start to the year. Despite ongoing uncertainty in the markets, our core businesses, credit quality and risk management remain strong. Our team is focused on building the business, delivering exceptional customer service and creating value for all stakeholders while remaining agile in this rapidly changing economic and regulatory environment.”

    Performance Highlights for the First Quarter of 2025

    • Adjusted for a one-time write-down on a foreclosed property in the current quarter, as well as transaction costs related to the merger with Lakeland in prior quarters, the Company’s annualized adjusted returns on average assets, average equity and average tangible equity(1) were 1.11%, 10.13% and 16.15% for the quarter ended March 31, 2025, compared to 1.05%, 9.53% and 15.39% for the quarter ended December 31, 2024. A reconciliation between GAAP and the above non-GAAP ratios is shown on page 11 of the earnings release.
    • The Company’s annualized adjusted pre-tax, pre-provision returns on average assets, average equity and average tangible equity(2) were 1.61%, 14.63% and 21.18% for the quarter ended March 31, 2025, compared to 1.53%, 13.91% and 20.31% for the quarter ended December 31, 2024. A reconciliation between GAAP and the above non-GAAP ratios is shown on page 11 of the earnings release.
    • The Company’s total commercial and industrial (“C&I”) loan portfolio increased $74.3 million, or 6.5% annualized, to $4.68 billion as of March 31, 2025, from $4.61 billion as of December 31, 2024. Additionally, the Company’s total commercial portfolio increased $150.0 million, or 3.8% annualized to $16.19 billion as of March 31, 2025, from $16.04 billion as of December 31, 2024.
    • The net interest margin increased six basis points to 3.34% for the quarter ended March 31, 2025, from 3.28% for the trailing quarter, while the core net interest margin, which excludes the impact of purchase accounting accretion and amortization, increased nine basis points from the trailing quarter to 2.94%. The average yield on total loans decreased four basis points to 5.95% for the quarter ended March 31, 2025, compared to the trailing quarter, while the average cost of deposits, including non-interest-bearing deposits, decreased 14 basis points to 2.11% for the quarter ended March 31, 2025.
    • The Company recorded a $325,000 provision for credit losses on loans for the quarter ended March 31, 2025, compared to a $7.8 million provision for the trailing quarter. The decrease in the provision for credit losses for the quarter was primarily attributable to the change in a qualitative factor indexed to the forecasted unemployment rate that resulted in a decrease in reserves required on pooled loans within our Current Expected Credit Loss (“CECL”) model. The allowance for credit losses as a percentage of loans decreased to 1.02% as of March 31, 2025, from 1.04% as of December 31, 2024.
    • Insurance Agency income increased $858,000 or 17.9%, versus the same period in 2024, while pre-tax Insurance Agency net income increased $544,000 or 23.3% versus the same period in 2024.
    • As of March 31, 2025, the Company’s loan pipeline, consisting of work-in-process and loans approved pending closing, totaled $2.77 billion, with a weighted average interest rate of 6.31%.

    Declaration of Quarterly Dividend

    The Company’s Board of Directors declared a quarterly cash dividend of $0.24 per common share payable on May 30, 2025 to stockholders of record as of the close of business on May 16, 2025.

    Results of Operations

    Three months ended March 31, 2025 compared to the three months ended December 31, 2024

    For the three months ended March 31, 2025, net income was $64.0 million, or $0.49 per basic and diluted share, compared to net income of $48.5 million, or $0.37 per basic and diluted share, for the three months ended December 31, 2024.

    Net Interest Income and Net Interest Margin

    Net interest income was $181.7 million for the three months ended March 31, 2025 and the trailing quarter, despite there being two fewer calendar days in the first quarter of 2025, primarily due to favorable repricing of deposits.

    The Company’s net interest margin increased six basis points to 3.34% for the quarter ended March 31, 2025, from 3.28% for the trailing quarter. The weighted average yield on interest-earning assets for the quarter ended March 31, 2025 decreased three basis points to 5.63%, compared to the trailing quarter. The weighted average cost of interest-bearing liabilities for the quarter ended March 31, 2025 decreased 13 basis points from the trailing quarter to 2.90%. The average cost of interest-bearing deposits for the quarter ended March 31, 2025 decreased 17 basis points to 2.64%, compared to 2.81% for the trailing quarter. The average cost of total deposits, including non-interest-bearing deposits, was 2.11% for the quarter ended March 31, 2025, compared to 2.25% for the trailing quarter. The average cost of borrowed funds for the quarter ended March 31, 2025 was 3.76%, compared to 3.64% for the quarter ended December 31, 2024.

    Provision for Credit Losses on Loans

    For the quarter ended March 31, 2025, the Company recorded a $325,000 provision for credit losses on loans, compared with a provision for credit losses of $7.8 million for the quarter ended December 31, 2024.  The decrease in the provision for credit losses for the quarter was primarily attributable to the change in a qualitative factor indexed to the forecasted unemployment rate that resulted in a decrease in reserves required on pooled loans within our CECL model.  For the three months ended March 31, 2025, net charge-offs totaled $2.0 million, or an annualized four basis points of average loans, compared with net charge-offs of $5.5 million, or an annualized nine basis points of average loans, for the trailing quarter.

    Non-Interest Income and Expense

    For the three months ended March 31, 2025, non-interest income totaled $27.0 million, an increase of $2.9 million, compared to the trailing quarter. Insurance agency income increased $2.4 million to $5.7 million for the three months ended March 31, 2025, compared to the trailing quarter, mainly due to the receipt of contingent commissions and additional business in the current quarter. Additionally, other income increased $920,000 to $2.2 million for the three months ended March 31, 2025, compared to the trailing quarter, primarily due to an increase in profit on fixed asset sales, combined with an increase in net fees on loan-level interest rate swap transactions. Partially offsetting these increases to non-interest income, wealth management income decreased $327,000 to $7.3 million for the three months ended March 31, 2025, compared to the trailing quarter, mainly due to a decrease in the average market value of assets under management during the period, while BOLI income decreased $169,000 for the three months ended March 31, 2025, compared to the trailing quarter, primarily due to decreased equity valuations.

    Non-interest expense totaled $116.3 million for the three months ended March 31, 2025, a decrease of $18.1 million, compared to $134.3 million for the trailing quarter. Merger-related expenses, which were completed at the end of 2024, decreased $20.2 million for the three months ended March 31, 2025, compared to the trailing quarter. Other operating expenses decreased $929,000 to $16.4 million for the three months ended March 31, 2025, compared to $17.4 million for the trailing quarter, largely due to a prior quarter $1.4 million charge for contingent litigation reserves, combined with decreases in professional service and insurance expenses, partially offset by a $2.7 million write-down on a foreclosed property. Partially offsetting these decreases in non-interest expense, compensation and benefits expense increased $2.4 million to $62.4 million for the three months ended March 31, 2025, compared to $59.9 million for the trailing quarter. The increase in compensation and benefit expense was primarily due to increases in salary expense related to company-wide annual merit increases and severance expense, partially offset by a decrease in stock-based compensation. Additionally, net occupancy expense increased $1.4 million to $13.9 million for the three months ended March 31, 2025, compared to the trailing quarter, largely due to seasonal increases in snow removal, utilities and other maintenance costs.

    The Company’s annualized adjusted non-interest expense as a percentage of average assets(1) totaled 1.92% for the quarter ended March 31, 2025, compared to 1.90% for the trailing quarter. The efficiency ratio (adjusted non-interest expense divided by the sum of net interest income and non-interest income)(1) was 54.43% for the three months ended March 31, 2025, compared to 55.43% for the trailing quarter.

    Income Tax Expense

    For the three months ended March 31, 2025, the Company’s income tax expense was $27.8 million with an effective tax rate of 30.3%, compared with income tax expense of $14.2 million with an effective tax rate of 22.6% for the trailing quarter. The increase in tax expense and the effective tax rate for the three months ended March 31, 2025, compared with the trailing quarter was largely due to an increase in taxable income and a discrete item related to stock-based compensation, combined with a prior quarter $4.2 million tax benefit related to the revaluation of certain deferred tax assets to reflect the imposition by the State of New Jersey of a 2.5% Corporate Transit Fee, effective January 1, 2024.

    Three months ended March 31, 2025 compared to the three months ended March 31, 2024

    For the three months ended March 31, 2025, net income was $64.0 million, or $0.49 per basic and diluted share, compared to net income of $32.1 million, or $0.43 per basic and diluted share, for the three months ended March 31, 2024.

    Net Interest Income and Net Interest Margin

    Net interest income increased $88.1 million to $181.7 million for the three months ended March 31, 2025, from $93.7 million for same period in 2024.  The increase in net interest income was favorably impacted by the net assets added in the May 16, 2024 acquisition of Lakeland and related accretion of purchase accounting adjustments.

    The Company’s net interest margin increased 47 basis points to 3.34% for the quarter ended March 31, 2025, from 2.87% for the same period last year. The weighted average yield on interest-earning assets for the quarter ended March 31, 2025 increased 57 basis points to 5.63%, compared to 5.06% for the quarter ended March 31, 2024. The weighted average cost of interest-bearing liabilities increased 10 basis points for the quarter ended March 31, 2025 to 2.90%, compared to 2.80% for the first quarter of 2024. The average cost of interest-bearing deposits for the quarter ended March 31, 2025 was 2.64%, compared to 2.60% for the same period last year. Average non-interest-bearing demand deposits increased $1.65 billion to $3.72 billion for the quarter ended March 31, 2025, compared to $2.07 billion for the quarter ended March 31, 2024. The average cost of total deposits, including non-interest-bearing deposits, was 2.11% for the quarter ended March 31, 2025, compared with 2.04% for the quarter ended March 31, 2024. The average cost of borrowed funds for the quarter ended March 31, 2025 was 3.76%, compared to 3.60% for the same period last year.

    Provision for Credit Losses on Loans

    For the quarter ended March 31, 2025, the Company recorded a $325,000 provision for credit losses on loans, compared with a $200,000 provision for credit losses on loans for the quarter ended March 31, 2024.  The increase in the provision for credit losses was due to an increase in specific reserves on impaired credits. For the three months ended March 31, 2025, net charge-offs totaled $2.0 million, or an annualized four basis points of average loans, compared with net charge-offs of $971,000, or an annualized four basis points of average loans, for the quarter ended March 31, 2024.

    Non-Interest Income and Expense

    Non-interest income totaled $27.0 million for the quarter ended March 31, 2025, an increase of $6.2 million, compared to the same period in 2024. Fee income increased $3.7 million to $9.7 million for the three months ended March 31, 2025, compared to the prior year quarter, primarily due to increases in deposit fee income, debit card related fee income and commercial loan prepayment fees, resulting from the Lakeland merger. Other income increased $1.4 million to $2.2 million for the three months ended March 31, 2025, compared to the quarter ended March 31, 2024, primarily due to an increase in profit on fixed asset sales, combined with an increase in net fees on loan-level interest rate swap transactions and an increase in gains on sales of mortgage loans. Insurance agency income increased $858,000 to $5.7 million for the three months ended March 31, 2025, compared to the quarter ended March 31, 2024, largely due to an increase in contingency income and business activity, while BOLI income increased $275,000 to $2.1 million for the three months ended March 31, 2025, compared to the prior year quarter, related to the addition of Lakeland’s BOLI, partially offset by a decrease in equity valuations.

    For the three months ended March 31, 2025, non-interest expense totaled $116.3 million, an increase of $44.4 million, compared to the three months ended March 31, 2024. Compensation and benefits expense increased $22.3 million to $62.4 million for three months ended March 31, 2025, compared to $40.0 million for the same period in 2024. The increase was primarily due to the addition of Lakeland, combined with an increase in salary expense associated with Company-wide annual merit increases. Amortization of intangibles increased $8.8 million to $9.5 million for the three months ended March 31, 2024, compared to $705,000 for 2024, largely due to core deposit intangible amortization related to the addition of Lakeland. Other operating expense increased $6.1 million to $16.4 million for the three months ended March 31, 2025, compared to $10.3 million for the three months ended March 31, 2024, largely due to the addition of Lakeland and a $2.7 million write-down on a foreclosed property in the current quarter. Net occupancy expense increased $5.4 million to $13.9 million for the three months ended March 31, 2024, compared to the same period in 2024, primarily due to increased depreciation and maintenance expenses because of the addition of Lakeland. Data processing expense increased $2.8 million to $9.6 million for three months ended March 31, 2025, compared to $6.8 million for the same period in 2024. The increase in data processing expense was primarily due to increases in software service, telecommunication and core service expenses, due to the addition of Lakeland. Additionally, FDIC insurance expense increased $1.1 million to $3.4 million for the three months ended March 31, 2025, compared to the same period in 2024, primarily due to increases in the assessment rate and average assets, as a result of the addition of Lakeland. Partially offsetting these increases in non-interest expense, merger-related expenses, which completed at the end of 2024 decreased $2.2 million for the three months ended March 31, 2025, compared to the same period in 2024.

    The Company’s annualized adjusted non-interest expense as a percentage of average assets(1) was 1.92% for the quarter ended March 31, 2025, compared to 1.99% for the same period in 2024. The efficiency ratio (adjusted non-interest expense divided by the sum of net interest income and non-interest income)(1) was 54.43% for the three months ended March 31, 2025 compared to 60.82% for the same respective period in 2024.

    Income Tax Expense

    For the three months ended March 31, 2025, the Company’s income tax expense was $27.8 million with an effective tax rate of 30.3%, compared with $10.9 million with an effective tax rate of 25.3% for the three months ended March 31, 2024. The increase in tax expense for the three months ended March 31, 2025, compared with the same period last year, was largely the result of an increase in taxable income and an increase in state tax rates as a result of the May 2024 Lakeland merger, as well as a discrete item related to stock-based compensation. The increase in state tax rates is a result of the Company no longer receiving benefit of a reduced New Jersey state rate available for the Company’s REIT and New Jersey investment company subsidiaries. The state of New Jersey allows certain bank subsidiaries with assets under $15 billion to benefit from the lower rate, however due to the Lakeland merger in May of 2024, the $15 billion asset threshold was crossed and the increased New Jersey rate was applicable.

    Asset Quality

    The Company’s total non-performing loans as of March 31, 2025 were $103.2 million, or 0.54% of total loans, compared $72.1 million, or 0.39% of total loans as of December 31, 2024 and $35.5 million, or 0.35% of total loans as of March 31, 2024. The $31.2 million increase in non-performing loans as of March 31, 2025, compared to the trailing quarter, was primarily attributable to two loans: a $20.3 million commercial real estate loan secured by a mixed use property with a current loan-to value of 53% and an $11.5 million construction loan secured by a nearly complete warehouse facility with a current loan-to-value of 62%. These loans have no prior charge-off history and carry no specific reserve allocations. As of March 31, 2025, impaired loans totaled $86.1 million with related specific reserves of $7.9 million, compared with impaired loans totaling $55.4 million with related specific reserves of $7.5 million as of December 31, 2024. As of March 31, 2024, impaired loans totaled $40.1 million with related specific reserves of $8.2 million.

    As of March 31, 2025, the Company’s allowance for credit losses related to the loan held for investment portfolio was 1.02% of total loans, compared to 1.04% and 0.98% as of December 31, 2024 and March 31, 2024, respectively. The allowance for credit losses decreased $1.7 million to $191.8 million as of March 31, 2025, from $193.4 million as of December 31, 2024. The decrease in the allowance for credit losses on loans at March 31, 2025 compared to December 31, 2024 was due to net charge-offs of $2.0 million, partially offset by a $325,000 provision for credit losses.

    The following table shows accruing past due loans and non-accrual loans on the dates indicated, as well as certain asset quality ratios.

        March 31, 2025   December 31, 2024   March 31, 2024  
        Number
    of
    Loans
      Principal
    Balance
    of Loans
      Number
    of
    Loans
      Principal
    Balance
    of Loans
      Number
    of
    Loans
      Principal
    Balance
    of Loans
     
        (Dollars in thousands)
    Accruing past due loans:                          
    30 to 59 days past due:                          
    Commercial mortgage loans   8   $ 13,696     7   $ 8,538     3   $ 5,052    
    Multi-family mortgage loans   1     7,433             4     12,069    
    Construction loans                          
    Residential mortgage loans   27     6,905     22     6,388     11     3,568    
    Total mortgage loans   36     28,034     29     14,926     18     20,689    
    Commercial loans   37     13,472     23     4,248     11     4,493    
    Consumer loans   22     1,604     47     3,152     22     803    
    Total 30 to 59 days past due   95   $ 43,110     99   $ 22,326     51   $ 25,985    
                               
    60 to 89 days past due:                          
    Commercial mortgage loans   2   $ 196     4   $ 3,954     3   $ 1,148    
    Multi-family mortgage loans                          
    Construction loans                          
    Residential mortgage loans   18     5,009     17     5,049     6     804    
    Total mortgage loans   20     5,205     21     9,003     9     1,952    
    Commercial loans   15     3,743     9     2,377     3     332    
    Consumer loans   12     854     15     856     8     755    
    Total 60 to 89 days past due   47     9,802     45     12,236     20     3,039    
    Total accruing past due loans   142   $ 52,912     144   $ 34,562     71   $ 29,024    
                               
    Non-accrual:                          
    Commercial mortgage loans   18   $ 42,931     17   $ 20,883     8   $ 5,938    
    Multi-family mortgage loans   5     7,294     6     7,498     2     2,355    
    Construction loans   3     18,929     2     13,246            
    Residential mortgage loans   22     5,246     23     4,535     10     1,647    
    Total mortgage loans   48     74,400     48     46,162     20     9,940    
    Commercial loans   83     27,471     65     24,243     21     36,892    
    Consumer loans   19     1,352     23     1,656     11     760    
    Total non-accrual loans   150   $ 103,223     136   $ 72,061     52   $ 47,592    
                               
    Non-performing loans to total loans         0.54%           0.39%           0.44%    
    Allowance for loan losses to total non-performing loans         185.78%           268.43%           223.63%    
    Allowance for loan losses to total loans         1.02%           1.04%           0.98%    
     

    The increase in accruing past due loans versus the trailing quarter was primarily attributable to two loans: a $10.5 million commercial real estate loan which is expected to be fully resolved in the second quarter through the completion of a pending note sale and a $7.4 million commercial real estate loan that is in the process of refinancing with the Company.

    As of March 31, 2025 and December 31, 2024, the Company held foreclosed assets of $6.8 million and $9.5 million, respectively. Foreclosed assets as of March 31, 2025 were comprised of commercial real estate. Total non-performing assets as of March 31, 2025 increased $28.4 million to $110.0 million, or 0.45% of total assets, from $81.5 million, or 0.34% of total assets as of December 31, 2024. During the three months ended March 31, 2025, there was a write-down of a foreclosed commercial property of $2.7 million based on a contracted sales price. The sale of this property is expected to close in the second quarter of 2025, reducing foreclosed assets by $5.8 million.

    Balance Sheet Summary

    Total assets as of March 31, 2025 were $24.22 billion, a $172.9 million increase from December 31, 2024. The increase in total assets was primarily due to a $132.0 million increase in total loans and a $110.5 million increase in total investments, partially offset by a decrease in intangible and other assets.

    The Company’s loans held for investment portfolio totaled $18.79 billion as of March 31, 2025 and $18.66 billion as of December 31, 2024. The portfolio consisted of the following:

      March 31, 2025   December 31, 2024    
      (Dollars in thousands)
    Mortgage loans:          
    Commercial $ 7,295,651     $ 7,228,078      
    Multi-family   3,458,190       3,382,933      
    Construction   756,356       823,503      
    Residential   1,994,404       2,010,637      
    Total mortgage loans   13,504,601       13,445,151      
    Commercial loans   4,682,902       4,608,600      
    Consumer loans   613,453       613,819      
    Total gross loans   18,800,956       18,667,570      
    Premiums on purchased loans   1,337       1,338      
    Net deferred fees and unearned discounts   (10,922)       (9,538)      
    Total loans $ 18,791,371     $ 18,659,370      
     

    During the three months ended March 31, 2025, the loans held for investment portfolio had net increases of $75.3 million of multi-family loans, $74.3 million of commercial loans and $67.6 million of commercial mortgage loans, partially offset by net decreases of $67.1 million of construction loans and $16.2 million of residential mortgage loans. Total commercial loans, consisting of commercial real estate, multi-family, commercial and construction loans, represented 86.1% of the loan portfolio as of March 31, 2025, compared to 85.9% as of December 31, 2024.

    For the three months ended March 31, 2025, loan funding, including advances on lines of credit, totaled $1.93 billion, compared with $622.7 million for the same period in 2024.

    As of March 31, 2025, the Company’s unfunded loan commitments totaled $2.88 billion, including commitments of $1.75 billion in commercial loans, $517.7 million in construction loans and $141.4 million in commercial mortgage loans. Unfunded loan commitments as of December 31, 2024 and March 31, 2024 were $2.73 billion and $1.97 billion, respectively.

    The loan pipeline, consisting of work-in-process and loans approved pending closing, totaled $2.77 billion as of March 31, 2025, compared to $1.79 billion and $1.08 billion as of December 31, 2024 and March 31, 2024, respectively.

    Total investment securities were $3.34 billion as of March 31, 2025, a $110.5 million increase from December 31, 2024. This increase was primarily due to purchases of mortgage-backed and municipal securities and a decrease in unrealized losses on available for sale debt securities.

    Total deposits decreased $175.0 million during the three months ended March 31, 2025, to $18.45 billion. Total savings and demand deposit accounts decreased $172.5 million to $15.28 billion as of March 31, 2025, while total time deposits decreased $2.4 million to $3.17 billion as of March 31, 2025. The decrease in savings and demand deposits consisted of a $142.8 million decrease in interest bearing demand deposits, a $22.0 million decrease in money market deposits and a $8.7 million decrease in savings deposits, partially offset by a $1.1 million increase in non-interest-bearing demand deposits. Within total savings and demand deposits, total municipal deposits decreased $130.8 million to $3.38 billion as of March 31, 2025, mainly due to seasonal outflows. The decrease in time deposits consisted of a $78.6 million decrease in retail time deposits, partially offset by a $76.2 million increase in brokered time deposits.

    Borrowed funds increased $315.8 million during the three months ended March 31, 2025, to $2.34 billion. The increase in borrowings was largely due to asset funding requirements. Borrowed funds represented 9.6% of total assets as of March 31, 2025, an increase from 8.4% as of December 31, 2024.

    Stockholders’ equity increased $57.6 million during the three months ended March 31, 2025, to $2.66 billion, primarily due to net income earned for the period and a decrease in unrealized losses on available for sale debt securities, partially offset by cash dividends paid to stockholders. For the three months ended March 31, 2025, common stock repurchases totaled 99,541 shares at an average cost of $18.19 per share, all of which were made in connection with withholding to cover income taxes on the vesting of stock-based compensation. As of March 31, 2025, approximately 873,000 shares remained eligible for repurchase under the current authorization. Book value per share and tangible book value per share(1) as of March 31, 2025 were $20.35 and $14.15, respectively, compared with $19.93 and $13.66, respectively, as of December 31, 2024.

    About the Company

    Provident Financial Services, Inc. is the holding company for Provident Bank, a community-oriented bank offering “Commitment you can count on” since 1839. Provident Bank provides a comprehensive array of financial products and services through its network of branches throughout New Jersey, Bucks, Lehigh and Northampton counties in Pennsylvania, as well as Orange, Queens and Nassau Counties in New York. The Bank also provides fiduciary and wealth management services through its wholly owned subsidiary, Beacon Trust Company and insurance services through its wholly owned subsidiary, Provident Protection Plus, Inc.

    Post Earnings Conference Call

    Representatives of the Company will hold a conference call for investors on Friday, April 25, 2025 at 10:00 a.m. Eastern Time to discuss the Company’s financial results for the quarter ended March 31, 2025. The call may be accessed by dialing 1-888-412-4131 (United States Toll Free) and 1-646-960-0134 (United States Local). Speakers will need to enter conference ID code (3610756) before being met by a live operator. Internet access to the call is also available (listen only) at provident.bank by going to Investor Relations and clicking on “Webcast.”

    Forward Looking Statements

    Certain statements contained herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as “may,” “will,” “believe,” “expect,” “estimate,” “project,” “intend,” “anticipate,” “continue,” or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those set forth in Item 1A of the Company’s Annual Report on Form 10-K, as supplemented by its Quarterly Reports on Form 10-Q, and those related to the economic environment, particularly in the market areas in which the Company operates, inflation and unemployment, competitive products and pricing, real estate values, fiscal and monetary policies of the U.S. Government, the effects of the recent turmoil in the banking industry, changes in accounting policies and practices that may be adopted by the regulatory agencies and the accounting standards setters, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, potential goodwill impairment, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets, the availability of and costs associated with sources of liquidity, and the impact of a potential shutdown of the federal government.

    The Company cautions readers not to place undue reliance on any such forward-looking statements which speak only as of the date they are made. The Company advises readers that the factors listed above could affect the Company’s financial performance and could cause the Company’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Company does not assume any duty, and does not undertake, to update any forward-looking statements to reflect events or circumstances after the date of this statement.

    Footnotes

    (1) Annualized adjusted pre-tax, pre-provision return on average assets, annualized return on average tangible equity, tangible book value per share, annualized adjusted non-interest expense as a percentage of average assets and the efficiency ratio are non-GAAP financial measures. Please refer to the Notes following the Consolidated Financial Highlights which contain the reconciliation of GAAP to non-GAAP financial measures and the associated calculations.

                 
    PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
    Consolidated Financial Highlights
    (Dollars in Thousands, except share data) (Unaudited)
         
      As of or for the
    Three months ended
     
      March 31,   December 31,   March 31,  
        2025       2024       2024    
    Statement of Income            
    Net interest income $ 181,728     $ 181,737     $ 93,670    
    Provision for credit losses   638       8,880       186    
    Non-interest income   27,030       24,175       20,807    
    Non-interest expense   116,267       134,323       71,321    
    Income before income tax expense   91,853       62,709       42,970    
    Net income   64,028       48,524       32,082    
    Diluted earnings per share $ 0.49     $ 0.37     $ 0.43    
    Interest rate spread   2.73%       2.63%       2.26%    
    Net interest margin   3.34%       3.28%       2.87%    
                 
    Profitability            
    Annualized return on average assets   1.08%       0.81%       0.92%    
    Annualized adjusted return on average assets (1)   1.11%       1.05%       0.97%    
    Annualized return on average equity   9.84%       7.36%       7.60%    
    Annualized adjusted return on average equity (1)   10.13%       9.53%       8.04%    
    Annualized return on average tangible equity (1)   15.73%       12.21%       10.40%    
    Annualized adjusted return on average tangible equity (1)   16.15%       15.39%       11.16%    
    Annualized adjusted non-interest expense to average assets (3)   1.92%       1.90%       1.99%    
    Efficiency ratio (4)   54.43%       55.43%       60.82%    
                 
    Asset Quality            
    Non-accrual loans $ 103,223     $ 72,061     $ 47,592    
    90+ and still accruing                  
    Non-performing loans   103,223       72,061       47,592    
    Foreclosed assets   6,755       9,473       11,324    
    Non-performing assets   109,978       81,534       58,916    
    Non-performing loans to total loans   0.54%       0.39%       0.44%    
    Non-performing assets to total assets   0.45%       0.34%       0.42%    
    Allowance for loan losses $ 191,770     $ 193,432     $ 106,429    
    Allowance for loan losses to total non-performing loans   185.78%       268.43%       223.63%    
    Allowance for loan losses to total loans   1.02%       1.04%       0.98%    
    Net loan charge-offs $ 1,987     $ 5,493     $ 971    
    Annualized net loan charge-offs to average total loans   0.04%       0.12%       0.04%    
                 
    Average Balance Sheet Data            
    Assets $ 24,049,318     $ 23,908,514     $ 14,093,767    
    Loans, net   18,590,877       18,487,443       10,668,992    
    Earning assets   21,946,053       21,760,458       12,862,910    
    Core deposits   15,497,343       15,581,608       9,129,244    
    Borrowings   1,918,069       1,711,806       1,940,981    
    Interest-bearing liabilities   17,297,892       17,093,382       10,074,106    
    Stockholders’ equity   2,638,361       2,624,019       1,698,170    
    Average yield on interest-earning assets   5.63%       5.66%       5.06%    
    Average cost of interest-bearing liabilities   2.90%       3.03%       2.80%    
                 

    Notes and Reconciliation of GAAP and Non-GAAP Financial Measures
    (Dollars in Thousands, except share data)

    The Company has presented the following non-GAAP (U.S. Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentation of these non-GAAP financial measures is consistent with how the Company evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Company’s industry. Investors should recognize that the Company’s presentation of these non-GAAP financial measures might not be comparable to similarly titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and the Company strongly encourages a review of its condensed consolidated financial statements in their entirety.

                   
    (1) Annualized Adjusted Return on Average Assets, Equity and Tangible Equity              
        Three Months Ended  
        March 31,   December 31,   March 31,  
          2025       2024       2024    
    Net Income   $ 64,028     $ 48,524     $ 32,082    
    Write-down on ORE property     2,690                
    Merger-related transaction costs           20,184       2,202    
    Less: income tax expense     (809)       (5,819)       (342)    
    Annualized adjusted net income   $ 65,909     $ 62,889     $ 33,942    
    Less: Amortization of Intangibles (net of tax)   $ 6,642     $ 6,649     $ 493    
    Annualized adjusted net income for annualized adjusted return on average tangible equity   $ 72,551     $ 69,538     $ 34,434    
                   
    Annualized Adjusted Return on Average Assets     1.11%       1.05%       0.97%    
    Annualized Adjusted Return on Average Equity     10.13%       9.53%       8.04%    
    Annualized Adjusted Return on Average Tangible Equity     16.15%       15.39%       11.16%    
                   
    (2) Annualized adjusted pre-tax, pre-provision (“PTPP”) returns on average assets, average equity and average tangible equity              
        Three Months Ended  
        March 31,   December 31,   March 31,  
          2025       2024       2024    
    Net income   $ 64,028     $ 48,524     $ 32,082    
    Adjustments to net income:              
    Provision charge (benefit) for credit losses     638       8,880       (320)    
    Write-down on ORE property     2,690                
    Merger-related transaction costs           20,184       2,202    
    Income tax expense     27,825       14,185       10,888    
    PTPP income   $ 95,181     $ 91,773     $ 44,852    
                   
    Annualized adjusted PTPP income   $ 386,012     $ 365,097     $ 180,394    
    Average assets   $ 24,049,318     $ 23,908,514     $ 14,093,767    
    Average equity   $ 2,638,361     $ 2,624,019     $ 1,698,170    
    Average tangible equity   $ 1,822,407     $ 1,797,994     $ 1,240,475    
                   
    Annualized adjusted PTPP return on average assets     1.61%       1.53%       1.28%    
    Annualized adjusted PTPP return on average equity     14.63%       13.91%       10.62%    
    Annualized adjusted PTPP return on average tangible equity     21.18%       20.31%       14.54%    
                   
    (3) Annualized Return on Average Tangible Equity              
        Three Months Ended  
        March 31,   December 31,   March 31,  
          2025       2024       2024    
    Total average stockholders’ equity   $ 2,638,361     $ 2,624,019     $ 1,698,170    
    Less: total average intangible assets     815,954       826,025       457,695    
    Total average tangible stockholders’ equity   $ 1,822,407     $ 1,797,994     $ 1,240,475    
                   
    Net income     64,028       48,524       32,082    
    Less: Amortization of Intangibles, net of tax     6,642       6,649       493    
    Total net income   $ 70,670     $ 55,173     $ 32,575    
                   
    Annualized return on average tangible equity (net income/total average tangible stockholders’ equity)     15.73%       12.21%       10.56%    
                   
    (4) Annualized Adjusted Non-Interest Expense to Average Assets              
        Three Months Ended  
        March 31,   December 31,   March 31,  
          2025       2024       2024    
    Reported non-interest expense   $ 116,267     $ 134,323     $ 71,321    
    Adjustments to non-interest expense:              
    Credit loss (benefit) expense for off-balance sheet credit exposures                 (506)    
    Write-down on ORE property     2,690                
    Merger-related transaction costs           20,184       2,202    
    Adjusted non-interest expense   $ 113,577     $ 114,139     $ 69,625    
                   
    Annualized adjusted non-interest expense   $ 460,618     $ 454,075     $ 280,030    
                   
    Average assets   $ 24,049,318     $ 23,908,514     $ 14,093,767    
                   
    Annualized adjusted non-interest expense/average assets     1.92%       1.90%       1.99%    
                   
    (5) Efficiency Ratio Calculation              
        Three Months Ended  
        March 31,   December 31,   March 31,  
          2025       2024       2024    
    Net interest income   $ 181,728     $ 181,737     $ 93,670    
    Non-interest income     27,030       24,175       20,807    
    Adjustments to non-interest income:              
    Net (gain) loss on securities transactions     (87)       14       1    
    Adjusted non-interest income   $ 26,943     $ 24,189     $ 20,808    
    Total income   $ 208,671     $ 205,926     $ 114,478    
                   
    Adjusted non-interest expense   $ 113,577     $ 114,139     $ 69,625    
                   
    Efficiency ratio (adjusted non-interest expense/income)     54.43%       55.43%       60.82%    
                   
    (6) Book and Tangible Book Value per Share   Three Months Ended  
        March 31,   December 31,   March 31,  
          2025       2024       2024    
    Total stockholders’ equity   $ 2,658,794     $ 2,601,207     $ 1,695,162    
    Less: total intangible assets     809,725       819,230       457,239    
    Total tangible stockholders’ equity   $ 1,849,069     $ 1,781,977     $ 1,237,923    
                   
    Shares outstanding     130,661,195       130,489,493       75,928,193    
                   
    Book value per share (total stockholders’ equity/shares outstanding)   $ 20.35     $ 19.93     $ 22.33    
    Tangible book value per share (total tangible stockholders’ equity/shares outstanding)   $ 14.15     $ 13.66     $ 16.30    
                   
                   
    PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
    Consolidated Statements of Financial Condition
    March 31, 2025 (Unaudited) and December 31, 2024
    (Dollars in Thousands)
           
    Assets March 31, 2025   December 31, 2024
    Cash and cash equivalents $ 234,076     $ 205,939  
    Available for sale debt securities, at fair value   2,878,785       2,768,915  
    Held to maturity debt securities, (net of $17,000 allowance as of March 31, 2025 (unaudited) and $14,000 allowance as of December 31, 2024)   314,005       327,623  
    Equity securities, at fair value   19,871       19,110  
    Federal Home Loan Bank stock   126,271       112,767  
    Loans held for sale   149,961       162,453  
    Loans held for investment   18,791,371       18,659,370  
    Less allowance for credit losses   191,770       193,432  
    Net loans   18,749,562       18,628,391  
    Foreclosed assets, net   6,755       9,473  
    Banking premises and equipment, net   115,424       119,622  
    Accrued interest receivable   91,776       91,160  
    Intangible assets   809,725       819,230  
    Bank-owned life insurance   407,986       405,893  
    Other assets   470,523       543,702  
    Total assets $ 24,224,759     $ 24,051,825  
           
    Liabilities and Stockholders’ Equity      
    Deposits:      
    Demand deposits $ 13,612,189     $ 13,775,991  
    Savings deposits   1,670,920       1,679,667  
    Certificates of deposit of $250,000 or more   767,626       789,342  
    Other time deposits   2,398,128       2,378,813  
    Total deposits   18,448,863       18,623,813  
    Mortgage escrow deposits   51,261       42,247  
    Borrowed funds   2,336,191       2,020,435  
    Subordinated debentures   402,853       401,608  
    Other liabilities   326,797       362,515  
    Total liabilities   21,565,965       21,450,618  
           
    Stockholders’ equity:      
    Preferred stock, $0.01 par value, 50,000,000 shares authorized, none issued          
    Common stock, $0.01 par value, 200,000,000 shares authorized, 137,565,966 shares issued and 130,663,184 shares outstanding as of March 31, 2025 and 130,489,493 outstanding as of December 31, 2024.   1,376       1,376  
    Additional paid-in capital   1,836,665       1,834,495  
    Retained earnings   1,021,266       989,111  
    Accumulated other comprehensive loss   (110,246)       (135,355)  
    Treasury stock   (90,267)       (88,420)  
    Total stockholders’ equity   2,658,794       2,601,207  
    Total liabilities and stockholders’ equity $ 24,224,759     $ 24,051,825  
    PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
    Consolidated Statements of Income
    Three months ended March 31, 2025, December 31, 2024 and March 31, 2024
    (Dollars in Thousands, except per share data) (Unaudited)
                 
      Three Months Ended  
      March 31,   December 31,   March 31,  
        2025     2024       2024    
    Interest and dividend income:            
    Real estate secured loans $ 187,054   $ 194,236     $ 107,456    
    Commercial loans   75,819     75,978       36,100    
    Consumer loans   10,158     10,815       4,523    
    Available for sale debt securities, equity securities and Federal Home Loan Bank stock   29,644     27,197       12,330    
    Held to maturity debt securities   1,996     2,125       2,268    
    Deposits, federal funds sold and other short-term investments   675     1,596       1,182    
    Total interest income   305,346     311,947       163,859    
                 
    Interest expense:            
    Deposits   97,420     105,922       52,534    
    Borrowed funds   17,778     15,652       17,383    
    Subordinated debt   8,420     8,636       272    
    Total interest expense   123,618     130,210       70,189    
    Net interest income   181,728     181,737       93,670    
    Provision charge for credit losses   638     8,880       (320)    
    Net interest income after provision for credit losses   181,090     172,857       93,990    
                 
    Non-interest income:            
    Fees   9,655     9,687       5,912    
    Wealth management income   7,328     7,655       7,488    
    Insurance agency income   5,651     3,289       4,793    
    Bank-owned life insurance   2,092     2,261       1,817    
    Net gain (loss) on securities transactions   87     (14)       (1)    
    Other income   2,217     1,297       798    
    Total non-interest income   27,030     24,175       20,807    
                 
    Non-interest expense:            
    Compensation and employee benefits   62,366     59,937       40,048    
    Net occupancy expense   13,927     12,562       8,520    
    Data processing expense   9,605     9,881       6,783    
    FDIC Insurance   3,385     3,411       2,272    
    Amortization of intangibles   9,501     9,511       705    
    Advertising and promotion expense   1,060     1,485       966    
    Merger-related expenses       20,184       2,202    
    Other operating expenses   16,423     17,352       10,331    
    Total non-interest expense   116,267     134,323       71,827    
    Income before income tax expense   91,853     62,709       42,970    
    Income tax expense   27,825     14,185       10,888    
    Net income $ 64,028   $ 48,524     $ 32,082    
                 
    Basic earnings per share $ 0.49   $ 0.37     $ 0.43    
    Average basic shares outstanding   130,325,393     130,067,244       75,260,029    
                 
    Diluted earnings per share $ 0.49   $ 0.37     $ 0.43    
    Average diluted shares outstanding   130,380,475     130,163,872       75,275,660    
    PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
    Net Interest Margin Analysis
    Quarterly Average Balances
    (Dollars in Thousands) (Unaudited)
      March 31, 2025   December 31, 2024   March 31, 2024
      Average Balance   Interest   Average
    Yield/Cost
      Average Balance   Interest   Average
    Yield/Cost
      Average Balance   Interest   Average
    Yield/Cost
    Interest-Earning Assets:                                  
    Deposits $ 80,074   $ 675   4.21%     $ 117,998   $ 1,596   5.38%     $ 87,869   $ 1,182   5.41%  
    Available for sale debt securities   2,827,699     27,621   3.89%       2,720,066     25,064   3.69%       1,673,950     10,022   2.39%  
    Held to maturity debt securities, net (1)   320,036     1,996   2.50%       328,147     2,125   2.59%       357,246     2,268   2.54%  
    Equity securities, at fair value   19,840       %     19,920       %     1,099       %
    Federal Home Loan Bank stock   107,527     2,023   7.53%       86,885     2,134   9.82%       73,754     2,308   12.52%  
    Net loans: (2)                                  
    Total mortgage loans   13,297,168     187,054   5.70%       13,287,942     194,236   5.75%       7,990,218     107,456   5.33%  
    Total commercial loans   4,684,572     75,819   6.56%       4,587,048     75,978   6.54%       2,381,965     36,100   6.03%  
    Total consumer loans   609,137     10,158   6.76%       612,453     10,815   7.02%       296,809     4,523   6.13%  
    Total net loans   18,590,877     273,031   5.95%       18,487,443     281,029   5.99%       10,668,992     148,079   5.51%  
    Total interest-earning assets $ 21,946,053   $ 305,346   5.63%     $ 21,760,458   $ 311,947   5.66%     $ 12,862,910   $ 163,859   5.06%  
                                       
    Non-Interest Earning Assets:                                  
    Cash and due from banks   134,205             159,151             116,563        
    Other assets   1,969,060             1,988,905             1,114,294        
    Total assets $ 24,049,318           $ 23,908,514           $ 14,093,767        
                                       
    Interest-Bearing Liabilities:                                  
    Demand deposits $ 10,095,570   $ 65,433   2.63%     $ 10,115,827   $ 71,265   2.80%     $ 5,894,062   $ 41,566   2.84%  
    Savings deposits   1,682,596     924   0.22%       1,677,725     968   0.23%       1,163,181     637   0.22%  
    Time deposits   3,199,620     31,063   3.94%       3,187,172     33,689   4.21%       1,065,170     10,331   3.90%  
    Total Deposits   14,977,786     97,420   2.64%       14,980,724     105,922   2.81%       8,122,413     52,534   2.60%  
                                       
    Borrowed funds   1,918,069     17,778   3.76%       1,711,806     15,652   3.64%       1,940,981     17,383   3.60%  
    Subordinated debentures   402,037     8,420   8.49%       400,852     8,636   8.57%       10,712     272   10.23%  
    Total interest-bearing liabilities   17,297,892     123,618   2.90%       17,093,382     130,210   3.03%       10,074,106     70,189   2.80%  
                                       
    Non-Interest Bearing Liabilities:                                  
    Non-interest bearing deposits   3,719,177             3,788,056             2,072,001        
    Other non-interest bearing liabilities   393,888             403,057             249,490        
    Total non-interest bearing liabilities   4,113,065             4,191,113             2,321,491        
    Total liabilities   21,410,957             21,284,495             12,395,597        
    Stockholders’ equity   2,638,361             2,624,019             1,698,170        
    Total liabilities and stockholders’ equity $ 24,049,318           $ 23,908,514           $ 14,093,767        
                                       
    Net interest income     $ 181,728           $ 181,737           $ 93,670    
                                       
    Net interest rate spread         2.73%             2.63%             2.26%  
    Net interest-earning assets $ 4,648,161           $ 4,667,076           $ 2,788,804        
                                       
    Net interest margin (3)         3.34%             3.28%             2.87%  
                                       
    Ratio of interest-earning assets to total interest-bearing liabilities 1.27x           1.27x           1.28x        
       
    (1 ) Average outstanding balance amounts shown are amortized cost, net of allowance for credit losses.
    (2 ) Average outstanding balances are net of the allowance for loan losses, deferred loan fees and expenses, loan premiums and discounts and include loans held for sale and non-accrual loans.
    (3 ) Annualized net interest income divided by average interest-earning assets.
    The following table summarizes the quarterly net interest margin for the previous five quarters.      
      3/31/25   12/31/24   9/30/24   6/30/24   3/31/24
      1st Qtr.   4th Qtr.   3rd Qtr.   2nd Qtr.   1st Qtr.
    Interest-Earning Assets:                  
    Securities 3.86%     3.78%     3.69%     3.40%     2.87%  
    Net loans 5.95%     5.99%     6.21%     6.05%     5.51%  
    Total interest-earning assets 5.63%     5.66%     5.84%     5.67%     5.06%  
                       
    Interest-Bearing Liabilities:                  
    Total deposits 2.64%     2.81%     2.96%     2.84%     2.60%  
    Total borrowings 3.76%     3.64%     3.73%     3.83%     3.60%  
    Total interest-bearing liabilities 2.90%     3.03%     3.19%     3.09%     2.80%  
                       
    Interest rate spread 2.73%     2.63%     2.65%     2.58%     2.26%  
    Net interest margin 3.34%     3.28%     3.31%     3.21%     2.87%  
                       
    Ratio of interest-earning assets to interest-bearing liabilities 1.27x     1.27x     1.26x     1.25x     1.28x  
    PROVIDENT FINANCIAL SERVICES, INC. AND SUBSIDIARY
    Net Interest Margin Analysis
    Average Year to Date Balances
    (Dollars in Thousands) (Unaudited)
                           
      March 31, 2025   March 31, 2024
      Average       Average   Average       Average
      Balance   Interest   Yield/Cost   Balance   Interest   Yield/Cost
    Interest-Earning Assets:                      
    Deposits $ 80,074   $ 675   4.21%     $ 87,869   $ 1,182   5.41%  
    Available for sale debt securities   2,827,699     27,621   3.89%       1,673,950     10,022   2.39%  
    Held to maturity debt securities, net (1)   320,036     1,996   2.50%       357,246     2,268   2.54%  
    Equity securities, at fair value   19,840       —%       1,099       —%  
    Federal Home Loan Bank stock   107,527     2,023   7.53%       73,754     2,308   12.52%  
    Net loans: (2)                      
    Total mortgage loans   13,297,168     187,054   5.70%       7,990,218     107,456   5.33%  
    Total commercial loans   4,684,572     75,819   6.56%       2,381,965     36,100   6.03%  
    Total consumer loans   609,137     10,158   6.76%       296,809     4,523   6.13%  
    Total net loans   18,590,877     273,031   5.95%       10,668,992     148,079   5.51%  
    Total interest-earning assets $ 21,946,053   $ 305,346   5.63%     $ 12,862,910   $ 163,859   5.06%  
                           
    Non-Interest Earning Assets:                      
    Cash and due from banks   134,205             116,563        
    Other assets   1,969,060             1,114,294        
    Total assets $ 24,049,318           $ 14,093,767        
                           
    Interest-Bearing Liabilities:                      
    Demand deposits $ 10,095,570   $ 65,433   2.63%     $ 5,894,062   $ 41,566   2.84%  
    Savings deposits   1,682,596     924   0.22%       1,163,181     637   0.22%  
    Time deposits   3,199,620     31,063   3.94%       1,065,170     10,331   3.90%  
    Total deposits   14,977,786     97,420   2.64%       8,122,413     52,534   2.60%  
    Borrowed funds   1,918,069     17,778   3.76%       1,940,981     17,383   3.60%  
    Subordinated debentures   402,037     8,420   8.49%       10,712     272   10.23%  
    Total interest-bearing liabilities $ 17,297,892   $ 123,618   2.90%     $ 10,074,106   $ 70,189   2.80%  
                           
    Non-Interest Bearing Liabilities:                      
    Non-interest bearing deposits   3,719,177             2,072,001        
    Other non-interest bearing liabilities   393,888             249,490        
    Total non-interest bearing liabilities   4,113,065             2,321,491        
    Total liabilities   21,410,957             12,395,597        
    Stockholders’ equity   2,638,361             1,698,170        
    Total liabilities and stockholders’ equity $ 24,049,318           $ 14,093,767        
                           
    Net interest income     $ 181,728           $ 93,670    
                           
    Net interest rate spread         2.73%             2.26%  
    Net interest-earning assets $ 4,648,161           $ 2,788,804        
                           
    Net interest margin (3)         3.34%             2.87%  
                           
    Ratio of interest-earning assets to total interest-bearing liabilities 1.27x           1.28x        
                           
                           
    (1) Average outstanding balance amounts shown are amortized cost, net of allowance for credit losses.
    (2) Average outstanding balance are net of the allowance for loan losses, deferred loan fees and expenses, loan premium and discounts and include loans held for sale and non-accrual loans.
    (3) Annualized net interest income divided by average interest-earning assets.
    The following table summarizes the year-to-date net interest margin for the previous three years.
                 
      Three Months Ended  
      March 31, 2025   March 31, 2024   March 31, 2023  
    Interest-Earning Assets:            
    Securities 3.86%     2.87%     2.52%    
    Net loans 5.95%     5.51%     5.12%    
    Total interest-earning assets 5.63%     5.06%     4.63%    
                 
    Interest-Bearing Liabilities:            
    Total deposits 2.64%     2.60%     1.39%    
    Total borrowings 3.76%     3.60%     2.48%    
    Total interest-bearing liabilities 2.90%     2.80%     1.54%    
                 
    Interest rate spread 2.73%     2.26%     3.09%    
    Net interest margin 3.34%     2.87%     3.48%    
                 
    Ratio of interest-earning assets to interest-bearing liabilities 1.27x     1.28x     1.34x    

    CONTACT: Investor Relations, 1-732-590-9300

    The MIL Network

  • MIL-OSI: Parker Increases Quarterly Cash Dividend 10% to $1.80 per Share

    Source: GlobeNewswire (MIL-OSI)

    CLEVELAND, April 24, 2025 (GLOBE NEWSWIRE) — Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today announced that its Board of Directors has declared a quarterly cash dividend of $1.80 per share of common stock to shareholders of record as of May 9, 2025. The dividend is payable June 6, 2025. The dividend represents a 10% increase over the previous quarterly cash dividend of $1.63 per common share and will be the 300th consecutive quarterly dividend paid by the company.

    “This dividend increase reflects the Board’s confidence in our financial position and continued ability to generate strong cash flows through the business cycle,” said Jenny Parmentier, Chairman and Chief Executive Officer. “Our performance and strong balance sheet give us the flexibility to strategically deploy capital to create shareholder value, including increasing our annual per share dividend record to 69 fiscal years.”

    Parker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Parker has increased its annual dividend per share paid to shareholders for 69 consecutive fiscal years, among the top five longest-running dividend-increase records in the S&P 500 index. Learn more at www.parker.com or @parkerhannifin.

    Forward-Looking Statements

    Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance.

    Among other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of tariffs and labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics. Readers should also consider forward-looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and other periodic filings made with the SEC.

    ###

    The MIL Network

  • MIL-OSI Global: It’s World Immunization Week. How prepared is Canada if vaccines are needed for a new pandemic?

    Source: The Conversation – Canada – By Kelley Lee, Professor and Tier 1 Canada Research Chair in Global Health Governance; Scientific Co-Director, Bridge Research Consortium, Simon Fraser University

    With the global resurgence of many vaccine-preventable diseases, World Immunization Week (April 24-30) provides a timely opportunity for Canadians to reflect on the goal of “Immunization for All.”

    The World Health Organization (WHO) raises awareness each year of the importance of equitable access to lifesaving and health-protecting vaccines. More than 154 million lives worldwide over the past 50 years have been saved by vaccines, excluding vaccines for COVID-19, malaria, influenza, human papilloma virus, and other deadly diseases.

    Immunization programs underpin 14 of the 17 United Nations Sustainable Development Goals. The global eradication of smallpox, 99 per cent reduction of wild polio cases since 1988, and 40 per cent reduction in infant mortality are why vaccines are celebrated among public health’s greatest achievements

    Continued benefits from vaccines under threat in Canada

    Supported by a universal health-care system, strong public health infrastructure, and publicly funded programs, Canada has enjoyed a century of decline in diseases such as measles, diphtheria and pertussis thanks to vaccines.

    Recent trends, however, are cause for concern. A decline in vaccine confidence, worsening since the COVID-19 pandemic, challenges of access and the inclusion of vaccines in partisan political rhetoric have led to reduced vaccine uptake.

    In 2024, 17 per cent of Canadian parents were “really against” vaccinating their children, up from four per cent in 2019. The measles outbreak in Ontario, with more than 800 cases and 61 hospitalizations, are real consequences of these choices. The Council of Canadian Academies estimated that COVID-19 misinformation cost Canada more than 2,800 lives and $300 million in additional health-care and economic losses.

    Vaccines for future pandemics

    The spectre of a new pandemic looms with the spread of highly pathogenic avian influenza (H5N1). In the United States, infections in dairy cattle and on poultry farms continue.

    With vaccination likely playing a critical role in any public health response, the dismantling of parts of the American public health infrastructure, defunding of vaccine research and ramping up of political rhetoric against vaccines is highly concerning. The United States’s withdrawal from global health, including the termination of funding to GAVI, the Vaccine Alliance and WHO, is likely to profoundly harm global immunization programs and pandemic preparedness.

    Canada must take stock of this changing landscape. Chief Public Health Officer Theresa Tam’s 2024 report, Realizing the Future of Vaccination for Public Health, sets out a clear framework for realizing the full potential of vaccination in Canada.
    In addition to major investments in new vaccine development and biomanufacturing in Canada, this public health framework is designed to support a better co-ordinated national immunization system, concerted efforts to address public trust, and efforts to improve equitable access.

    Need for a national immunization registry

    The lack of integration of Canada’s fragmented immunization data across provinces and territories makes it more challenging to plan vaccine rollouts, identify coverage gaps or rapidly track adverse events after immunization. The Canadian Public Health Association and others have long called for a comprehensive and harmonized immunization registry as essential for a modern and responsive system.

    A national framework for vaccine data collection would allow policymakers and practitioners to make evidence-informed decisions in real time.

    Supporting public trust

    Sustaining high vaccination coverage begins with public trust in science, government and public health. While most people still trust science and scientists, what constitutes trustworthy sources of information has become a serious problem.

    Insufficient transparency around vaccine development, regulation and monitoring of adverse reactions needs addressing. Concerns about the rapid pace of scientific advances, including the 100-days mission to produce an effective vaccine for a future pandemic, must be recognized.

    With so many new vaccines expected to roll out in coming years, including new frontiers in neurodegenerative disorders and vaccines for certain cancers, a harmonized vaccine schedule would foster public trust. In this context, vaccine misinformation has become a serious problem.

    Centring equitable access and design

    The COVID-19 pandemic showed how structural inequalities reduced the ability to access vaccines.

    Initiatives during the pandemic to support equitable access — such as mobile clinics, culturally appropriate information and community-led initiatives — increased uptake. These approaches need to be extended to routine vaccination.

    Moreover, building supportive environments means incorporating an “equity by design” approach, which applies regulatory tools and systems design to support vaccine equity, from discovery to rollout means that the ability to keep vaccines refridgerated cold chains or needle delivery, for example, do not contribute to disparities of access.

    Bridge Research Consortium

    The Bridge Research Consortium (BRC) is a multidisciplinary team of social scientists and humanities scholars established in 2024 to understand the social and behavioural factors that influence new vaccine uptake in Canada.

    Bridging understandings across the “pipeline” for developing new vaccines and therapeutics, and the public health system, the BRC supports tailored and equity-informed strategies that enhance public trust and equitable access. We will hear directly from communities across the country, identify concerns in real-time, and co-develop approaches that reflect diverse perspectives. We plan to achieve this through demystifying how vaccines are developed and produced, holding deliberative dialogues that bring together diverse perspectives on challenging topics, and creating a travelling science exhibit. World Immunization Week is a timely reminder of the importance of this work to enable Canada to realize the potential benefits of vaccines.

    Immunity and Society is a new series from The Conversation Canada that presents new vaccine discoveries and immune-based innovations that are changing how we understand and protect human health. Through a partnership with the Bridge Research Consortium, these articles — written by academics in Canada at the forefront of immunology and biomanufacturing — explore the latest developments and their social impacts.

    Kelley Lee receives funding from the Canada’s Biomedical Research Fund, Canada Foundation for Innovation, and British Columbia Knowledge Development Fund to support the work of the Bridge Research Consortium. The BRC is one of 19 projects funded to support Canada’s Biomanufacturing and Life Sciences Strategy. She also receives funding from the Canadian Institutes of Health Research and New Frontiers in Research Fund to conduct research on pandemic preparedness and response. She currently serves as a Commissioner on the National University of Singapore-The Lancet Pandemic Readiness, Implementation, Monitoring and Evaluation (PRIME) Commission.

    Ève Dubé receives funding from the Canada’s Biomedical Research Fund, Canada Foundation for Innovation, to support the work of the Bridge Research Consortium. The BRC is one of 19 projects funded to support Canada’s Biomanufacturing and Life Sciences Strategy. She also receives funding from the Canadian Institutes of Health Research and the Fonds de recherche du Québec to conduct research on vaccine acceptance.

    Janice E. Graham receives funding from CIHR and PHAC.

    Noni MacDonald receives funding from CIHR, CIRN grants related to immunization as well as PHAC and CPHA consultation fees related to immunization. She is a member of the Canadian Paediatric Society and the International Pediatric Society, a donor to Canadian Public Health Association and WHO, and on board of the journal Vaccine.

    ref. It’s World Immunization Week. How prepared is Canada if vaccines are needed for a new pandemic? – https://theconversation.com/its-world-immunization-week-how-prepared-is-canada-if-vaccines-are-needed-for-a-new-pandemic-254186

    MIL OSI – Global Reports

  • MIL-OSI USA: Commissioner Kristin N. Johnson: Africa Fintech Summit 2025 Keynote Remarks

    Source: US Commodity Futures Trading Commission

    It is a privilege to join you today to kick-off the Africa Fintech Summit of 2025. Twice a year this convening serves as one of the largest gatherings of Africa’s Fintech Community—connecting entrepreneurs, investors, and regulators during the International Monetary Fund/World Bank spring meeting week in Washington, DC. and in the fall in Africa. My tremendous thanks to the organizers and hosts. 
    As you arrived this morning, I am sure you were able to appreciate the perfect spring weather and blooming cherry blossoms that we ordered for you this week. There are few places in DC that are lovelier this time of year than where we sit, here in Georgetown. 
    In my career, I have learned about entrepreneurship from mentors and clients at the world’s largest investment banks, small start-ups, and family-founded businesses. My family’s history as entrepreneurs and informal investors in community small businesses dates to the mid-1800s here in the United States. Perhaps one day, I will have the opportunity to continue this tradition and help fund the businesses of innovative founders. 
    Today, I am a Commissioner at the U.S. Commodity Futures Trading Commission, nominated by former President Biden and unanimously confirmed by the United States Senate.[1] At the CFTC, we oversee U.S. markets and market participants for derivatives contracts that reference commodities. According to a Bank for International Settlements report, the notional value of the global derivatives market is over $730 trillion.[2] In recent years, courts and Congress have indicated intentions to expand the CFTC’s mandate to include oversight of emerging technologies, including distributed digital ledger technologies commonly referred to as blockchain technologies, digital assets, including cryptocurrencies, and certain platforms within the assemblage of technologies referred to as artificial intelligence. 
    African Fintech Firms Inspire a World of Innovation
    African fintech firms demonstrate curiosity, creativity, and driven commitment to deliver first-rate fintech products and services to consumers and businesses on the continent and around the world.   
    During my time as a CFTC Commissioner, I have traveled to South Africa, Kenya, Zambia, and Ghana to meet with fintech entrepreneurs. I have witnessed first-hand the exceptional creativity and curiosity that drives African fintech entrepreneurs. As you well know from CNBC’s announcement last year, six African fintech firms are among the world’s top fintech companies PalmPay, Flutterwave, Kuda, MTN, Piggvest, and Yoco.[3] African fintech firms have emerged from every corner of the continent. 
    In various stages of development—from incubators to early stages (pre-seed) capital raising to joint ventures with Google, Microsoft, and AWS—African fintech firms enhance financial accessibility, inclusivity, and consumer empowerment. These businesses integrate the most advanced technologies available, reflect global thought leadership in the potential for emerging technologies to reshape access and opportunities for both consumer and commercial finance, and create pathways for inclusion that have inspired creative consumer finance solutions around the globe.
    As you know well, the recipe for entrepreneurial success begins with a great idea. Yet, building opportunities in fast-moving, high-tech markets requires a number of critical inputs as well as conditions to facilitate growth and development. Entrepreneurs or innovators, funders or sources of capital, and, yes, regulators all have an important role to play in promoting responsible innovation and growth. It has been my pleasure to collaborate with regulators around the continent as they consider ways to spur innovation and growth. Last year, during my keynote remarks at the South African Reserve Bank Fintech Summit in Johannesburg[4] and at the beginning of this year in Ghana, I emphasized the opportunities for African fintech firms to innovate using AI in consumer finance. 
    The Rise of AI in Fintech
    As I noted in my opening remarks at The South African Reserve Bank Fintech Summit last year,
    While our markets have long relied upon AI for a variety of risk management and predictive pricing functions, we are witnessing rapid developments beyond reinforcement learning and neural networks in generative AI.
    Increasingly, diverse industries and sectors of our economy identify opportunities to integrate aspects of the assemblage of technologies that we commonly describe as AI or AI technologies. AI enables doctors to diagnose and map diseases earlier, faster, and with greater accuracy than ever before in the history of medicine. Farmers who cultivate crops that feed [] nation[s] may integrate AI to better manage access to vital resources such as freshwater, enabling more efficient irrigation, fertilization, and crop rotation leading to more sustainable farming.
    In our markets, AI offers similar efficiencies for faster trade execution and settlement, more accurate pricing prediction, and more precise risk management oversight. Markets have witnessed increasing adoption of AI including AI-driven investment advising, trade execution, risk management, and market surveillance.[5]
    Financial services firms are fully embracing the powers of AI, making increasingly large investments in infrastructure to support AI and expanding the roster of use cases. One economist estimates that investments in AI may reach $97 billion by 2027.[6] 
    Notable Challenges for Inclusion 
    As AI adoption expands across markets, however, there are a number of notable challenges. For many, the costs of relying on large language models or agentic AI will place these technologies beyond the resources of their businesses. 
    Accessibility and Inclusivity Challenges for Global Competitors 
    The high cost of developing advanced AI technologies and the infrastructure to support their use poses significant accessibility and inclusivity barriers, particularly disadvantaging smaller competitors and institutions in emerging markets. These barriers limit the widespread adoption of AI-driven financial solutions, which can disproportionately affect underserved and economically disadvantaged populations who could most benefit from improved financial services. This can make it exceptionally hard for emerging companies to incorporate AI into their services if the infrastructure does not already exist. To that end, we are seeing private companies form partnerships to make necessary investments to scale up AI capabilities in Africa, like Cassava Technologies, a global technology leader, and their partnership with Nvidia to develop Africa’s first AI factory in South Africa.[7] 
    At the Commission, we have also explored regulatory frameworks addressing AI’s role in financial markets through an ongoing conversation with market participants.[8] The Commission has acknowledged the potential for AI-driven systems to impact consumer protection indirectly through enhanced market integrity and risk management protocols, but it has also acknowledged the dangers that consumers can face.[9] 
    I have repeatedly emphasized the need to establish robust principles-based regulatory frameworks at the Commission to combat consumer-facing issues like AI-enabled market manipulation and fraud, through my repeated emphasis on the need to promote the explainability of AI models, the implementation of data controls and measures to address bias, clear governance frameworks for accountability and testing, and the establishment of an interagency task force and an AI Fraud Task Force to tackle fraud full force.[10] In particular, firms implementing this technology in consumer-facing ways must adhere to existing laws on fairness, transparency, and privacy.
    The Financial Stability Board (FSB) has highlighted the importance of international collaboration in setting standards for responsible AI use, advocating for coordinated frameworks that ensure consumer protection, fairness, and transparency in AI-powered financial services globally.[11] International collaboration amongst regulators can aid in streamlining the growing body of international standards which can be difficult to navigate and present a significant barrier to emerging companies. Meanwhile, countries like Singapore have also made significant strides in regulating and supporting consumer-facing AI applications through initiatives like the Monetary Authority of Singapore’s regulatory sandbox framework, allowing fintech startups to test AI-driven solutions in controlled environments, balancing innovation with consumer protection.[12]
    Africa’s Embrace of AI to Promote Accessibility, Consumer Interaction, and Further Innovation
    Through strategic partnerships between AI startups, larger corporations, and governmental agencies, increased access to advanced AI technologies and traditional financial services have been more readily obtainable. Sitoyo Lopokoiyit, CEO and founder of M-Pesa, and others demonstrate how strategic partnerships, cost-effective approaches, and mobile-first innovations can significantly reduce barriers, enabling broader AI adoption and the growth of consumer inclusive financial services. M-Pesa, a mobile money services platform, which hosts millions of customers and facilitates billions in transactions per year, may be used to deposit money into an account, “store it on … cell phones, send balances using PINs secured by SMS text messages, and enable buyers and sellers of goods to redeem and access purchases as well as deposits for regular money…. M-Pesa represents the potential to develop platforms that give customers access to banking services, reduce transaction costs, and otherwise overcome the endemic frictions that have challenged access to financial services for millions.”[13] 
    M-Pesa’s business model is particularly interesting because of how effectively it has created access for individuals who have historically lacked access to basic financial services. I previously traveled to Kenya to meet with the CEO and President of M-Pesa, as well as central bankers, the governor of the Central Bank of Kenya, and deputy governors and market regulators, to discuss the uptick in retail market participation and the considerations for consumer protection that come with the increased accessibility to financial markets. 
    Conclusion
    Continued partnerships between African fintech innovators, African regulators, and U.S. regulators and institutions can help foster shared growth and technological advancement for both parties. Such collaborations offer significant opportunities, combining African innovation in financial inclusion and mobile technologies with U.S. strengths in regulatory frameworks, research, and infrastructure. These synergistic relationships can enhance global fintech capabilities, drive inclusive economic growth, and promote greater financial stability and consumer protection worldwide.
    Conferences like the one we are participating in today are of vital importance to the notion of collaboration. The issues discussed, the connections made, and the lessons shared here today can help propel markets forward in a way that not only protects the consumer but also empowers the consumer.
    Thank you again for allowing me to join you today. I look forward to hearing from each of the panels and speakers and continuing to develop great relationships with the leading voices in fintech in Africa.

    [1] The thoughts and perspectives that I share with you today are my own; they are not the views and perspectives of my fellow Commissioners, the Commission, or the staff of the CFTC.

    MIL OSI USA News

  • MIL-OSI: First Western Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    First Quarter 2025 Summary

    • Net income available to common shareholders of $4.2 million in Q1 2025, compared to $2.7 million in Q4 2024
    • Diluted earnings per share of $0.43 in Q1 2025, compared to $0.28 in Q4 2024
    • Net interest income of $17.5 million in Q1 2025, compared to $16.9 million in Q4 2024
    • Net interest margin increased 16 basis points from 2.45% in Q4 2024 to 2.61% in Q1 2025
    • Other real estate owned (“OREO”) decreased $31.5 million from $35.9 million in Q4 2024 to $4.4 million in Q1 2025 due to the sale of two properties for a net gain of $0.5 million
    • Noninterest-bearing deposits increased 9.1% from $375.6 million as of Q4 2024 to $409.7 million as of Q1 2025

    DENVER, April 24, 2025 (GLOBE NEWSWIRE) — First Western Financial, Inc. (“First Western” or the “Company”) (NASDAQ: MYFW), today reported financial results for the first quarter ended March 31, 2025.

    Net income available to common shareholders was $4.2 million, or $0.43 per diluted share, for the first quarter of 2025. This compares to net income of $2.7 million, or $0.28 per diluted share, for the fourth quarter of 2024, and net income of $2.5 million, or $0.26 per diluted share, for the first quarter of 2024.

    Scott C. Wylie, CEO of First Western, commented, “As expected, we generated a significant improvement in our level of profitability in the first quarter. We saw positive trends in many areas including an expansion in our net interest margin, a higher level of non-interest income, an increase in noninterest-bearing deposits, solid loan production, and well managed expenses. We also saw general stability in asset quality while having a substantial reduction in our nonperforming assets following the successful resolution of our two largest OREO properties, which were sold for a net gain.

    “We expect to see a continuation of the positive trends we are seeing, while we also redeploy the cash from the sale of our two largest OREO properties into interest-earning assets. We believe this will continue to result in solid financial performance for our shareholders as we move through the year,” said Mr. Wylie.

       
      For the Three Months Ended
      March 31,   December 31,   March 31,
    (Dollars in thousands, except per share data)   2025       2024       2024  
    Earnings Summary          
    Net interest income $ 17,453     $ 16,908     $ 16,070  
    Less: Provision (release) for credit losses   80       (974 )     72  
    Total non-interest income   7,345       6,459       7,277  
    Total non-interest expense   19,361       20,427       19,696  
    Income before income taxes   5,357       3,914       3,579  
    Income tax expense   1,172       1,166       1,064  
    Net income available to common shareholders   4,185       2,748       2,515  
    Basic earnings per common share   0.43       0.28       0.26  
    Diluted earnings per common share   0.43       0.28       0.26  
               
    Return on average assets (annualized)   0.59 %     0.38 %     0.35 %
    Return on average shareholders’ equity (annualized)   6.63       4.39       4.10  
    Return on tangible common equity (annualized)(1)   7.44       4.98       4.71  
    Net interest margin   2.61       2.45       2.34  
    Efficiency ratio(1)   79.16       80.74       83.68  

    _____________________

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure.
       

    Operating Results for the First Quarter 2025

    Revenue

    Total income before non-interest expense was $24.7 million for the first quarter of 2025, compared to $24.3 million for the fourth quarter of 2024. Gross revenue(1) was $24.6 million for the first quarter of 2025, compared to $23.8 million for the fourth quarter of 2024. Relative to the fourth quarter of 2024, the increase in total income before non-interest expense was primarily driven by increases in Net interest income, Net gain on mortgage loans, Net gain on other real estate owned, and Net gain on loans held for sale, partially offset by an increase in provision for credit losses and a decrease in Risk management and insurance fees. Relative to the first quarter of 2024, total income before non-interest expense increased 6.0% from $23.3 million and Gross revenue increased 4.7% from $23.5 million. Relative to the first quarter of 2024, the increase in total income before non-interest expense was primarily driven by increases in Net interest income and Net gain on other real estate owned, partially offset by decreases in Bank fees and Trust and investment management fees.

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure.
       

    Net Interest Income

    Net interest income for the first quarter of 2025 was $17.5 million, an increase of 3.6% from $16.9 million in the fourth quarter of 2024. The increase quarter over quarter was primarily driven by a 16 basis point increase in net interest margin, offset partially by a decline in average interest-earning assets. Relative to the first quarter of 2024, net interest income increased 8.7% from $16.1 million. The increase compared to the first quarter of 2024 was primarily driven by an 27 basis point increase in net interest margin, offset partially by a decline in average interest-earning assets.

    Net Interest Margin

    Net interest margin for the first quarter of 2025 increased 16 basis points to 2.61% from 2.45% reported in the fourth quarter of 2024, primarily due to a decrease in cost of deposits and increase in interest-earning assets yield.

    The yield on interest-earning assets increased 4 basis points to 5.57% from 5.53% reported in the fourth quarter of 2024 and the cost of interest-bearing deposits decreased 19 basis points to 3.59% from 3.78% reported in the fourth quarter of 2024.

    Relative to the first quarter of 2024, net interest margin increased 27 basis points from 2.34%, primarily due to a 32 basis point decrease in total cost of funds.

    Non-interest Income

    Non-interest income for the first quarter of 2025 was $7.3 million, an increase of 12.3% from $6.5 million in the fourth quarter of 2024. The increase was driven primarily by increases in Net gain on other real estate owned, Net gain on mortgage loans, and Net gain on loans held for sale, partially offset by a decrease in Risk management and insurance fees. The increase in Net gain on other real estate was due to the sale of our two largest OREO properties for a net gain of $0.5 million. The increase in Net gain on loans held for sale was due to the reversal of the previous quarter’s write-down on a non-performing loan. This loan was previously classified as held for sale; however, during the quarter it was transferred to held for investment and charged off through the Allowance for credit losses.

    Relative to the first quarter of 2024, non-interest income increased slightly, driven primarily by increases in Net gain on other real estate owned and Net gain on loans accounted for under the fair value option, offset partially by decreases in Trust and investment management fees and Bank fees.

    Non-interest Expense

    Non-interest expense for the first quarter of 2025 was $19.4 million, a decrease of 4.9% from $20.4 million in the fourth quarter of 2024. The decrease was primarily driven by the one-time $1.1 million Other real estate owned (“OREO”) write-down recognized in the fourth quarter of 2024, offset partially by an increase in Salaries and employee benefits.

    Relative to the first quarter of 2024, non-interest expense decreased 1.5% from $19.7 million, driven primarily by a decrease in Professional services due to decreases in legal expenses, audit fees, and FDIC insurance fees, partially offset by increases in Occupancy and equipment expenses and Salaries and employee benefits.

    The Company’s efficiency ratio(1) was 79.2% in the first quarter of 2025, compared with 80.7% in the fourth quarter of 2024 and 83.7% in the first quarter of 2024.

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure.
       

    Income Taxes

    The Company recorded Income tax expense of $1.2 million for the first quarter of 2025, compared to Income tax expense of $1.2 million for the fourth quarter of 2024 and Income tax expense of $1.1 million for the first quarter of 2024.

    Loans

    Total loans held for investment of $2.43 billion as of March 31, 2025 was flat compared to December 31, 2024. Changes in the quarter included net growth in the commercial real estate and 1 – 4 family residential portfolios, offset by net decreases in the cash, securities, and other and construction and development portfolios. Total average loans were $2.41 billion for the first quarter of 2025, an increase of $21.4 million from $2.39 billion for the fourth quarter of 2024. Relative to the first quarter of 2024, total loans held for investment decreased from $2.48 billion as of March 31, 2024, primarily driven by net decreases in the commercial and industrial, construction and development, and cash, securities, and other portfolios, partially offset by net growth in the 1 – 4 family residential and non-owner occupied commercial real estate portfolios.

    Deposits

    Total deposits were $2.52 billion as of March 31, 2025, an increase of 0.4% from $2.51 billion as of December 31, 2024. Relative to the first quarter of 2024, total deposits decreased from $2.53 billion as of March 31, 2024, driven primarily by a decrease in Noninterest-bearing deposits.

    Borrowings

    Federal Home Loan Bank (“FHLB”) and Federal Reserve borrowings were a combined $51.6 million as of March 31, 2025, a decrease of $5.4 million from $57.0 million as of December 31, 2024. The change when compared to December 31, 2024 was primarily driven by net pay downs on the Company’s FHLB line of credit. Relative to the first quarter of 2024, borrowings decreased $17.9 million from $69.5 million as of March 31, 2024. The decrease in borrowings from March 31, 2024 was primarily driven by BTFP payoffs and net pay downs on the Company’s FHLB line of credit.

    Subordinated notes were $44.6 million as of March 31, 2025, compared to $52.6 million as of December 31, 2024. Subordinated notes decreased $7.8 million from $52.4 million as of March 31, 2024. Relative to the fourth quarter of 2024 and first quarter of 2024, the decrease was due to the call of $8.0 million of subordinated notes that became eligible to call in the first quarter of 2025.

    Assets Under Management

    Assets Under Management (“AUM”) decreased to $7.18 billion as of March 31, 2025, compared to $7.32 billion as of December 31, 2024. The decrease in AUM during the quarter was primarily attributable to net withdrawals throughout the first quarter of 2025. Compared to March 31, 2024, total AUM increased slightly from $7.14 billion.

    Credit Quality

    Non-performing assets totaled $17.1 million, or 0.59% of total assets, as of March 31, 2025, compared to $49.0 million, or 1.68% of total assets, as of December 31, 2024. The decrease in non-performing assets during the quarter was primarily due to the sale of two OREO properties for a net gain of $0.5 million. As of March 31, 2024, non-performing assets totaled $46.0 million, or 1.57% of total assets. Relative to the first quarter of 2024, the decrease in non-performing assets was primarily driven by the sale of two OREO properties, partially offset by additions to non-performing loans. OREO totaled $4.4 million as of March 31, 2025 a decrease of $31.5 million from $35.9 million as of December 31, 2024. As of March 31, 2024, the Company held no OREO.

    Non-performing loans totaled $12.8 million as of March 31, 2025, a decrease of $0.3 million from $13.1 million as of December 31, 2024. The decrease was primarily due to the charge-off of a non-performing loan that had previously been held for sale. As of March 31, 2024, non-performing loans totaled $46.0 million. The decrease when compared to March 31, 2024 was driven by the migration of one loan relationship out of non-performing loans and into OREO, partially offset by additions to non-performing loans.

    During the first quarter of 2025, the Company recorded provision expense of $0.1 million, compared to a provision release of $1.0 million in the fourth quarter of 2024 and provision expense of $0.1 million in the first quarter of 2024.

    Capital

    As of March 31, 2025, First Western (“Consolidated”) and First Western Trust Bank (“Bank”) exceeded the minimum capital levels required by their respective regulators. As of March 31, 2025, the Bank was classified as “well capitalized,” as summarized in the following table:

       
      March 31,
      2025
    Consolidated Capital  
    Tier 1 capital to risk-weighted assets 10.35 %
    Common Equity Tier 1 (“CET1”) to risk-weighted assets 10.35  
    Total capital to risk-weighted assets 13.15  
    Tier 1 capital to average assets 8.12  
       
    Bank Capital  
    Tier 1 capital to risk-weighted assets 11.76 %
    CET1 to risk-weighted assets 11.76  
    Total capital to risk-weighted assets 12.52  
    Tier 1 capital to average assets 9.24  
         

    Book value per common share increased 1.3% from $26.10 as of December 31, 2024 to $26.44 as of March 31, 2025. Book value per common share increase 3.6% from $25.52 as of March 31, 2024.

    Tangible book value per common share(1) increased 1.6% from $22.83 as of December 31, 2024, to $23.18 as of March 31, 2025. Tangible book value per common share increased 4.4% from $22.21 as of March 31, 2024.

    (1) Represents a Non-GAAP financial measure. See “Reconciliations of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure.
       

    Conference Call, Webcast and Slide Presentation

    The Company will host a conference call and webcast at 10:00 a.m. MT/ 12:00 p.m. ET on Friday, April 25, 2025. Telephone access: https://register-conf.media-server.com/register/BI019349e043a94dc394d0159a3c41719d.

    A slide presentation relating to the first quarter 2025 results will be accessible prior to the scheduled conference call. The slide presentation and webcast of the conference call can be accessed on the Events and Presentations page of the Company’s investor relations website at https://myfw.gcs-web.com.

    About First Western

    First Western is a financial services holding company headquartered in Denver, Colorado, with operations in Colorado, Arizona, Wyoming, California, and Montana. First Western and its subsidiaries provide a fully integrated suite of wealth management services on a private trust bank platform, which includes a comprehensive selection of deposit, loan, trust, wealth planning and investment management products and services. First Western’s common stock is traded on the Nasdaq Global Select Market under the symbol “MYFW.” For more information, please visit www.myfw.com.

    Non-GAAP Financial Measures

    Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with generally accepted accounting principles in the United States (“GAAP”). These non-GAAP financial measures include “Tangible Common Equity,” “Tangible Common Book Value per Share,” “Return on Tangible Common Equity,” “Efficiency Ratio,” “Gross Revenue,” and “Allowance for Credit Losses to Adjusted Loans”. The Company believes these non-GAAP financial measures provide both management and investors a more complete understanding of the Company’s financial position and performance. These non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP financial measures. Not all companies use the same calculation of these measures; therefore, this presentation may not be comparable to other similarly titled measures as presented by other companies. Reconciliation of non-GAAP financial measures to GAAP financial measures are provided at the end of this press release.

    Forward-Looking Statements

    Statements in this news release regarding our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “project,” “position,” “outlook,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “opportunity,” “could,” or “may.” The forward-looking statements in this news release are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this news release and could cause us to make changes to our future plans. Those risks and uncertainties include, without limitation, the lack of soundness of other financial institutions or financial market utilities may adversely affect the Company; the Company’s ability to engage in routine funding and other transactions could be adversely affected by the actions and commercial soundness of other financial institutions; financial institutions are interrelated because of trading, clearing, counterparty or other relationships; defaults by, or even rumors or questions about, one or more financial institutions or financial market utilities, or the financial services industry generally, may lead to market-wide liquidity problems and losses of client, creditor and counterparty confidence and could lead to losses or defaults by other financial institutions, or the Company; integration risks and projected cost savings in connection with acquisitions; the risk of geographic concentration in Colorado, Arizona, Wyoming, California, and Montana; the risk of changes in the economy affecting real estate values and liquidity; the risk in our ability to continue to originate residential real estate loans and sell such loans; risks specific to commercial loans and borrowers; the risk of claims and litigation pertaining to our fiduciary responsibilities; the risk of competition for investment managers and professionals; the risk of fluctuation in the value of our debt securities; the risk of changes in interest rates; the risk of the adequacy of our allowance for credit losses; the risk in our ability to maintain a strong core deposit base or other low-cost funding sources; the risk of weak economic conditions and global trade, including the imposition of tariffs; the risk that legislative or regulatory actions may have a significant adverse effect on our operations. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on March 7, 2025 (“Form 10-K”), and other documents we file with the SEC from time to time. We urge readers of this news release to review the “Risk Factors” section our Form 10-K and any updates to those risk factors set forth in our subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and our other filings with the SEC. Also, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release, which speak only as of today’s date, or to make predictions based solely on historical financial performance. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

    Contacts:
    Financial Profiles, Inc.
    Tony Rossi
    310-622-8221
    MYFW@finprofiles.com
    IR@myfw.com

       
    First Western Financial, Inc.
    Condensed Consolidated Statements of Income (unaudited)
       
      Three Months Ended
      March 31,   December 31,   March 31,
    (dollars in thousands, except per share amounts)   2025     2024       2024  
    Interest and dividend income:          
    Loans, including fees $ 34,068   $ 34,287     $ 35,139  
    Loans accounted for under the fair value option   111     118       209  
    Investment securities   681     696       603  
    Interest-bearing deposits in other financial institutions   2,221     2,879       2,352  
    Dividends, restricted stock   128     129       95  
    Total interest and dividend income   37,209     38,109       38,398  
               
    Interest expense:          
    Deposits   18,516     19,921       20,622  
    Other borrowed funds   1,240     1,280       1,706  
    Total interest expense   19,756     21,201       22,328  
    Net interest income   17,453     16,908       16,070  
    Less: Provision (release) for credit losses   80     (974 )     72  
    Net interest income, after provision (release) for credit losses   17,373     17,882       15,998  
               
    Non-interest income:          
    Trust and investment management fees   4,677     4,660       4,930  
    Net gain on mortgage loans   1,067     377       1,264  
    Net gain (loss) on loans held for sale   222     (222 )     117  
    Bank fees   422     426       891  
    Risk management and insurance fees   259     1,139       49  
    Income on company-owned life insurance   110     112       105  
    Net gain (loss) on loans accounted for under the fair value option   6     (149 )     (302 )
    Net gain on other real estate owned   459            
    Unrealized gain (loss) recognized on equity securities   11     (49 )     (6 )
    Other   112     165       229  
    Total non-interest income   7,345     6,459       7,277  
    Total income before non-interest expense   24,718     24,341       23,275  
               
    Non-interest expense:          
    Salaries and employee benefits   11,480     11,237       11,267  
    Occupancy and equipment   2,210     2,100       1,976  
    Professional services   1,704     1,821       2,411  
    Technology and information systems   1,078     1,073       1,010  
    Data processing   1,122     1,029       948  
    Marketing   216     397       194  
    Amortization of other intangible assets   51     56       57  
    Other   1,500     2,714       1,833  
    Total non-interest expense   19,361     20,427       19,696  
    Income before income taxes   5,357     3,914       3,579  
    Income tax expense   1,172     1,166       1,064  
    Net income available to common shareholders $ 4,185   $ 2,748     $ 2,515  
    Earnings per common share:          
    Basic $ 0.43   $ 0.28     $ 0.26  
    Diluted   0.43     0.28       0.26  
                         
                         
               
    First Western Financial, Inc.
    Condensed Consolidated Balance Sheets (unaudited)
               
      March 31,   December 31,   March 31,
    (dollars in thousands)   2025       2024       2024  
    Assets          
    Cash and cash equivalents:          
    Cash and due from banks $ 15,924     $ 9,770     $ 8,136  
    Interest-bearing deposits in other financial institutions   255,658       226,271       249,753  
    Total cash and cash equivalents   271,582       236,041       257,889  
               
    Held-to-maturity debt securities (fair value of $67,479, $68,161 and $64,908, respectively), net of allowance for credit losses of $71   73,775       75,724       72,303  
    Correspondent bank stock, at cost   5,968       5,864       4,461  
    Mortgage loans held for sale, at fair value   10,557       25,455       10,470  
    Loans held for sale, at fair value         251        
    Loans (includes $6,112, $7,283, and $11,922 measured at fair value, respectively)   2,425,367       2,425,565       2,475,524  
    Allowance for credit losses   (17,956 )     (18,330 )     (24,630 )
    Loans, net   2,407,411       2,407,235       2,450,894  
    Premises and equipment, net   24,554       24,129       24,869  
    Accrued interest receivable   10,623       10,364       11,919  
    Accounts receivable   4,505       4,763       4,980  
    Other receivables   4,608       5,710       5,254  
    Other real estate owned, net   4,385       35,929        
    Goodwill and other intangible assets, net   31,576       31,627       31,797  
    Deferred tax assets, net   2,856       3,079       5,695  
    Company-owned life insurance   17,071       16,961       16,635  
    Other assets   36,829       35,905       35,051  
    Total assets $ 2,906,300     $ 2,919,037     $ 2,932,217  
               
    Liabilities          
    Deposits:          
    Noninterest-bearing $ 409,696     $ 375,603     $ 434,236  
    Interest-bearing   2,105,701       2,138,606       2,097,734  
    Total deposits   2,515,397       2,514,209       2,531,970  
    Borrowings:          
    Federal Home Loan Bank and Federal Reserve borrowings   51,612       57,038       69,484  
    Subordinated notes   44,621       52,565       52,397  
    Accrued interest payable   2,371       1,995       2,415  
    Other liabilities   35,744       40,908       30,423  
    Total liabilities   2,649,745       2,666,715       2,686,689  
               
    Shareholders’ Equity          
    Total shareholders’ equity   256,555       252,322       245,528  
    Total liabilities and shareholders’ equity $ 2,906,300     $ 2,919,037     $ 2,932,217  
                           
                           
               
    First Western Financial, Inc.
    Consolidated Financial Summary (unaudited)
               
      March 31,   December 31,   March 31,
    (dollars in thousands)   2025       2024       2024  
    Loan Portfolio          
    Cash, Securities, and Other(1) $ 101,078     $ 120,005     $ 151,178  
    Consumer and Other   16,688       17,333       18,556  
    Construction and Development   291,133       315,686       333,284  
    1-4 Family Residential   971,179       960,354       910,129  
    Non-Owner Occupied CRE   636,820       614,384       562,862  
    Owner Occupied CRE   182,417       173,223       194,338  
    Commercial and Industrial   223,197       220,501       297,573  
    Total   2,422,512       2,421,486       2,467,920  
    Loans accounted for under the fair value option   6,280       7,508       12,276  
    Total loans held for investment   2,428,792       2,428,994       2,480,196  
    Deferred (fees) costs and unamortized premiums/(unaccreted discounts), net(2)   (3,425 )     (3,429 )     (4,672 )
    Loans (includes $6,112, $7,283, and $11,922 measured at fair value, respectively) $ 2,425,367     $ 2,425,565     $ 2,475,524  
    Mortgage loans held for sale   10,557       25,455       10,470  
    Loans held for sale         251        
               
    Deposit Portfolio          
    Money market deposit accounts $ 1,566,737     $ 1,513,605     $ 1,503,598  
    Time deposits   379,533       471,415       442,834  
    Interest checking accounts   144,980       139,374       132,415  
    Savings accounts   14,451       14,212       18,887  
    Total interest-bearing deposits   2,105,701       2,138,606       2,097,734  
    Noninterest-bearing accounts   409,696       375,603       434,236  
    Total deposits $ 2,515,397     $ 2,514,209     $ 2,531,970  

    ____________________

    (1) Includes PPP loans of $1.6 million as of March 31, 2025, $2.1 million as of December 31, 2024, and $3.8 million as of March 31, 2024.
    (2) Includes fair value adjustments on loans held for investment accounted for under the fair value option.
       
       
    First Western Financial, Inc.
    Consolidated Financial Summary (unaudited) (continued)
       
      As of or for the Three Months Ended
      March 31,   December 31,   March 31,
    (dollars in thousands)   2025       2024       2024  
    Average Balance Sheets          
    Assets          
    Interest-earning assets:          
    Interest-bearing deposits in other financial institutions $ 198,294     $ 236,152     $ 177,523  
    Debt securities   75,592       77,464       74,666  
    Correspondent bank stock   5,806       5,738       4,451  
    Gross loans   2,407,482       2,386,070       2,490,300  
    Mortgage loans held for sale   13,593       26,623       6,752  
    Loans held at fair value   6,846       8,136       13,134  
    Total interest-earning assets   2,707,613       2,740,183       2,766,826  
    Noninterest-earning assets   145,479       161,783       100,170  
    Total assets $ 2,853,092     $ 2,901,966     $ 2,866,996  
               
    Liabilities and Shareholders’ Equity          
    Interest-bearing liabilities:          
    Interest-bearing deposits $ 2,090,505     $ 2,095,204     $ 2,008,246  
    FHLB and Federal Reserve borrowings   51,885       54,428       92,195  
    Subordinated notes   52,495       52,528       52,360  
    Total interest-bearing liabilities   2,194,885       2,202,160       2,152,801  
    Noninterest-bearing liabilities:          
    Noninterest-bearing deposits   363,922       403,433       446,457  
    Other liabilities   41,656       45,889       22,250  
    Total noninterest-bearing liabilities   405,578       449,322       468,707  
    Total shareholders’ equity   252,629       250,484       245,488  
    Total liabilities and shareholders’ equity $ 2,853,092     $ 2,901,966     $ 2,866,996  
               
    Yields/Cost of funds (annualized)          
    Interest-bearing deposits in other financial institutions   4.54 %     4.85 %     5.33 %
    Debt securities   3.65       3.57       3.25  
    Correspondent bank stock   8.94       8.94       8.58  
    Loans   5.71       5.65       5.66  
    Loan held at fair value   6.58       5.77       6.40  
    Mortgage loans held for sale   5.46       6.02       6.79  
    Total interest-earning assets   5.57       5.53       5.58  
    Interest-bearing deposits   3.59       3.78       4.13  
    Total deposits   3.06       3.17       3.38  
    FHLB and Federal Reserve borrowings   3.92       3.96       4.23  
    Subordinated notes   5.70       5.59       5.66  
    Total interest-bearing liabilities   3.65       3.83       4.17  
    Net interest margin   2.61       2.45       2.34  
    Net interest rate spread   1.92       1.70       1.41  
                           
                           
       
    First Western Financial, Inc.
    Consolidated Financial Summary (unaudited) (continued)
       
      As of or for the Three Months Ended
      March 31,   December 31,   March 31,
    (dollars in thousands, except share and per share amounts)   2025       2024       2024  
    Asset Quality          
    Non-performing loans $ 12,758     $ 13,052     $ 46,044  
    Non-performing assets   17,143       48,981       46,044  
    Net charge-offs (recoveries)   566       (270 )      
    Non-performing loans to total loans   0.53 %     0.54 %     1.86 %
    Non-performing assets to total assets   0.59       1.68       1.57  
    Allowance for credit losses to non-performing loans   140.74       140.44       53.49  
    Allowance for credit losses to total loans   0.74       0.76       1.00  
    Allowance for credit losses to adjusted loans(1)   0.74       0.76       1.00  
    Net charge-offs (recoveries) to average loans   0.02       (0.01 )      
               
    Assets Under Management $ 7,176,624     $ 7,321,147     $ 7,141,453  
               
    Market Data          
    Book value per share at period end $ 26.44     $ 26.10     $ 25.52  
    Tangible book value per common share(1)   23.18       22.83       22.21  
    Weighted average outstanding shares, basic   9,704,419       9,665,621       9,621,309  
    Weighted average outstanding shares, diluted   9,798,591       9,794,797       9,710,764  
    Shares outstanding at period end   9,704,320       9,667,142       9,621,309  
               
    Consolidated Capital          
    Tier 1 capital to risk-weighted assets   10.35 %     10.07 %     9.77 %
    CET1 to risk-weighted assets   10.35       10.07       9.77  
    Total capital to risk-weighted assets   13.15       13.12       13.15  
    Tier 1 capital to average assets   8.12       7.88       7.73  
               
    Bank Capital          
    Tier 1 capital to risk-weighted assets   11.76 %     11.41 %     11.00 %
    CET1 to risk-weighted assets   11.76       11.41       11.00  
    Total capital to risk-weighted assets   12.52       12.10       12.02  
    Tier 1 capital to average assets   9.24       8.94       8.70  

    ________________________

    (1) Represents a Non-GAAP financial measure. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of our Non-GAAP measures to the most directly comparable GAAP financial measure.
       
       
    First Western Financial, Inc.
    Consolidated Financial Summary (unaudited) (continued)
       
    Reconciliations of Non-GAAP Financial Measures
       
      As of or for the Three Months Ended
      March 31,   December 31,   March 31,
    (dollars in thousands, except share and per share amounts)   2025       2024       2024  
    Tangible Common          
    Total shareholders’ equity $ 256,555     $ 252,322     $ 245,528  
    Less: goodwill and other intangibles, net   31,576       31,627       31,797  
    Tangible common equity $ 224,979     $ 220,695     $ 213,731  
               
    Common shares outstanding, end of period   9,704,320       9,667,142       9,621,309  
    Tangible common book value per share $ 23.18     $ 22.83     $ 22.21  
    Net income available to common shareholders   4,185       2,748       2,515  
    Return on tangible common equity (annualized)   7.44 %     4.98 %     4.71 %
               
    Efficiency          
    Non-interest expense $ 19,361     $ 20,427     $ 19,696  
    Less: OREO expenses and write-downs   (80 )     1,222        
    Adjusted non-interest expense $ 19,441     $ 19,205     $ 19,696  
               
    Total income before non-interest expense $ 24,718     $ 24,341     $ 23,275  
    Less: unrealized gain (loss) recognized on equity securities   11       (49 )     (6 )
    Less: net gain (loss) on loans accounted for under the fair value option   6       (149 )     (302 )
    Less: net gain (loss) on loans held for sale   222       (222 )     117  
    Plus: provision (release) for credit losses   80       (974 )     72  
    Gross revenue $ 24,559     $ 23,787     $ 23,538  
    Efficiency ratio   79.16 %     80.74 %     83.68 %
                           

    The MIL Network

  • MIL-OSI: NBT Bancorp Inc. Announces First Quarter 2025 Net Income

    Source: GlobeNewswire (MIL-OSI)

    NORWICH, N.Y., April 24, 2025 (GLOBE NEWSWIRE) — NBT Bancorp Inc. (“NBT” or the “Company”) (NASDAQ: NBTB) reported net income and diluted earnings per share for the three months ended March 31, 2025.

    Net income for the first quarter of 2025 was $36.7 million, or $0.77 per diluted common share, compared to $33.8 million, or $0.71 per diluted common share, for the first quarter of 2024, and $36.0 million, or $0.76 per diluted common share, for the fourth quarter of 2024. Operating diluted earnings per share(1), a non-GAAP measure, was $0.80 for the first quarter of 2025, compared to $0.68 for the first quarter of 2024 and $0.77 for the fourth quarter of 2024.

    CEO Comments

    “Growth in both net interest income and noninterest income compared to the prior quarter and the first quarter of 2024 resulted in the generation of positive operating leverage by our team in the first quarter of 2025.” said NBT President and Chief Executive Officer Scott A. Kingsley. “Our capital position remains a key strength as we execute on strategic growth initiatives. We recently added new banking locations in South Burlington, VT and Webster, NY, and we look forward to completing our planned merger with Evans Bancorp, Inc. in early May. The addition of over 200 experienced bankers and 18 locations from Evans will firmly establish NBT’s presence in Buffalo and Rochester, Upstate New York’s two largest markets by population.”

    First Quarter 2025 Financial Highlights

    Net Income
    • Net income was $36.7 million and diluted earnings per share was $0.77
    Net Interest Income / NIM
    • Net interest income on a fully taxable equivalent (“FTE”) basis was $107.2 million, an increase of $1.1 million from the prior quarter(1)
    • Net interest margin (“NIM”) on an FTE basis was 3.44%(1), an increase of 10 basis points (“bps”) from the prior quarter
    • Included in FTE net interest income was $2.2 million of acquisition-related net accretion, which was down $0.4 million from the fourth quarter of 2024
    • Earning asset yields of 4.95% were down 1 bp from the prior quarter
    • Total cost of funds of 1.60% was down 11 bps from the prior quarter
    Noninterest Income
    • Noninterest income was $47.6 million, an increase of 12.7% from the fourth quarter of 2024, excluding net securities gains (losses)
    Loans and Credit Quality
    • Period end total loans were $9.98 billion as of March 31, 2025, up $10.4 million, or 0.4% annualized, from December 31, 2024
    • Net charge-offs to average loans was 0.27% annualized
    • Nonperforming loans to total loans was 0.48%
    • Allowance for loan losses to total loans was 1.17%
    Deposits
    • Deposits were $11.71 billion as of March 31, 2025, up $161.8 million, or 1.4%, from December 31, 2024
    • Total cost of deposits was 1.49% for the first quarter of 2025, down 11 bps from the fourth quarter of 2024
    Capital
    • Stockholders’ equity was $1.57 billion as of March 31, 2025
    • Tangible book value per share(2) was $24.74 at March 31, 2025
    • Tangible equity to assets of 8.68%(1)
    • CET1 ratio of 12.12%; Leverage ratio of 10.39%


    Loans

    • Period end total loans were $9.98 billion at March 31, 2025, compared to $9.97 billion at December 31, 2024.
    • Period end total loans increased $10.4 million from December 31, 2024. Total commercial loans increased $23.9 million to $5.33 billion while total consumer loans decreased $13.6 million to $4.65 billion. Excluding the other consumer and residential solar portfolios, which are in a planned run-off status, period end loans increased $40.5 million, or 1.8% annualized. Residential real estate loan balances decreased $14.7 million from December 31, 2024 primarily due to seasonally lower originations and market conditions. In addition, the Company originated and sold $7.4 million of 30-year fixed rate mortgages in the first quarter of 2025.

    Deposits

    • Total deposits at March 31, 2025 were $11.71 billion, compared to $11.55 billion at December 31, 2024. The $161.8 million increase in deposits from December 31, 2024 was primarily due to the inflow of seasonal municipal deposits during the quarter.
    • The loan to deposit ratio was 85.2% at March 31, 2025, compared to 86.3% at December 31, 2024.

    Net Interest Income and Net Interest Margin

    • Net interest income for the first quarter of 2025 was $107.2 million, an increase of $1.1 million, or 1.1%, from the fourth quarter of 2024 and an increase of $12.0 million, or 12.7%, from the first quarter of 2024. The increase in net interest income from the fourth quarter of 2024 resulted primarily from a decrease in the cost of deposits, partially offset by lower yields on loans and two fewer days in the first quarter of 2025.
    • The NIM on an FTE basis for the first quarter of 2025 was 3.44%, an increase of 10 bps from the fourth quarter of 2024. This increase was driven by the decrease in the cost of interest-bearing deposits. The NIM on an FTE basis increased 30 bps from the first quarter of 2024 due to higher average balances of earning assets and the yields on those assets, lower average balances of short-term borrowings and the decrease in the cost of interest-bearing deposits.
    • Earning asset yields for the three months ended March 31, 2025 decreased 1 bp from the prior quarter to 4.95%. Loan yields for the three months ended March 31, 2025 decreased 3 bps from the prior quarter to 5.62% primarily due to the repricing of $2.1 billion in variable rate loans from the 25 bps federal funds rate decrease in December, partially offset by loans originating at higher rates than portfolio yields during the quarter. Earnings asset yields increased 11 bps from the same quarter in the prior year as new loan yields were priced higher than portfolio yields. Average earning assets were consistent with the fourth quarter of 2024 due to the decrease in short-term interest-bearing accounts being mostly offset by an increase in securities and organic loan growth. Average earning assets grew $427.5 million, or 3.5%, from the first quarter of 2024 due to growth in average loans and securities.
    • Total cost of deposits, including noninterest bearing deposits, was 1.49% for the first quarter of 2025, a decrease of 11 bps from the prior quarter and a decrease of 12 bps from the same period in the prior year.
    • Total cost of funds for the three months ended March 31, 2025 was 1.60%, a decrease of 11 bps from the prior quarter and a decrease of 19 bps from the first quarter of 2024.

    Asset Quality and Allowance for Loan Losses

    • Net charge-offs to total average loans for the first quarter of 2025 was 27 bps compared to 23 bps in the prior quarter primarily due to an increase in consumer net charge-offs. Included in net charge-offs for the first quarter of 2025 was a $2.1 million write-down of a nonperforming commercial real estate loan to the estimated fair value.
    • Nonperforming assets to total assets was 0.35% at March 31, 2025, compared to 0.38% at December 31, 2024.
    • Provision expense for the three months ended March 31, 2025 was $7.6 million, compared to $2.2 million for the fourth quarter of 2024. The increase in provision expense from the prior quarter was primarily due to the deterioration in economic forecasts and a higher level of net charge-offs partially offset by the run-off of the other consumer and residential solar portfolios.
    • The allowance for loan losses was $117.0 million, or 1.17% of total loans, at March 31, 2025, compared to $116.0 million, or 1.16% of total loans, at December 31, 2024.
    • The reserve for unfunded loan commitments was $4.5 million at March 31, 2025, compared to $4.4 million at December 31, 2024.

    Noninterest Income                

    • Total noninterest income, excluding securities gains (losses), was $47.6 million for the three months ended March 31, 2025, up $5.4 million, or 12.7%, from the fourth quarter of 2024, and up $4.3 million, or 10.1%, from the first quarter of 2024.
    • Retirement plan administration fees were up $2.9 million from the prior quarter and increased $1.6 million from the first quarter of 2024. The increase from the prior quarter was due to higher seasonal activity-based fees in the first quarter and the additional revenue from both organic growth and the acquisition of a small third-party administrator (“TPA”) business in the fourth quarter of 2024. The increase from the first quarter of 2024 was driven by the additional revenue from new customer plans, the TPA acquisition and higher market values of assets under administration.
    • Wealth management fees were consistent with the prior quarter and increased $1.2 million from the first quarter of 2024. The increase from the first quarter of 2024 was driven by market performance and growth in new customer accounts.
    • Insurance revenues increased $0.9 million from the fourth quarter of 2024 due to organic growth, higher levels of policy renewals and first quarter seasonality.
    • Bank owned life insurance income increased from both the fourth quarter of 2024 and the first quarter of 2024 due to a $1.3 million nonrecurring gain.

    Noninterest Expense        

    • Total noninterest expense was $99.9 million for the first quarter of 2025, compared to $100.8 million for the fourth quarter of 2024 and $91.8 million for the first quarter of 2024. Total noninterest expense decreased 1.1% compared to the previous quarter and increased 7.5% from the first quarter of 2024, excluding $1.2 million of acquisition expenses in the first quarter of 2025 and $1.0 million in the fourth quarter of 2024, respectively.
    • Salaries and benefits decreased 1.7% from the prior quarter driven by lower medical and other benefit costs, lower levels of incentive compensation and lower salaries due to two fewer payroll days in the quarter, partially offset by seasonally higher payroll taxes and stock-based compensation expenses. The increase from the first quarter of 2024 was driven by merit pay increases which were effective annually in March, an increase in employees supporting growth in our markets and higher medical and other benefit costs.
    • Occupancy costs increased $1.2 million from the prior quarter primarily due to seasonal maintenance and utilities costs. The $0.9 million increase from the first quarter of 2024 was driven by higher seasonal maintenance and utilities given the harsher winter and higher facilities costs related to new banking locations.
    • Other expense decreased $1.7 million from the prior quarter and was consistent with the first quarter of 2024. The decrease from the previous quarter was driven by timing of expenses and Company initiatives in the fourth quarter of 2024.

    Income Taxes

    • The effective tax rate for the first quarter of 2025 was 22.2% which was up from 21.7% for the first quarter of 2024 primarily due to a lower level of tax-exempt income as a percentage of total taxable income.

    Capital

    • Tangible common equity to tangible assets(1) was 8.68% at March 31, 2025. Tangible book value per share(2) was $24.74 at March 31, 2025 and $23.88 at December 31, 2024.
    • Stockholders’ equity increased $39.6 million from December 31, 2024 driven by net income generation of $36.7 million and a $20.3 million decrease in accumulated other comprehensive loss reflecting the change in the fair value of securities available for sale, partially offset by dividends declared of $16.1 million.
    • As of March 31, 2025, CET1 capital ratio of 12.12%, leverage ratio of 10.39% and total risk-based capital ratio of 15.24%.

    Stock Repurchase

    • The Company did not purchase shares of its common stock during the three months ended March 31, 2025. The Company may repurchase shares of its common stock from time to time to mitigate the potential dilutive effects of stock-based incentive plans and other potential uses of common stock for corporate purposes. As of March 31, 2025, there were 1,992,400 shares available under the Company’s share repurchase program.

    Evans Bancorp, Inc. Merger

    • NBT and Evans anticipate completing the previously announced merger on May 2, 2025 simultaneously with the core system conversion, pending customary closing conditions. Evans had assets of $2.19 billion, deposits of $1.87 billion and net loans of $1.76 billion as of December 31, 2024. Pursuant to the merger agreement, NBT will acquire 100% of the outstanding shares of Evans in exchange for common shares of NBT. The exchange ratio will be fixed at 0.91 NBT shares for each share of Evans.

    Conference Call and Webcast

    The Company will host a conference call at 10:00 a.m. (Eastern) Friday, April 25, 2025, to review the first quarter 2025 financial results. The audio webcast link, along with the corresponding presentation slides, will be available on the Company’s Event Calendar page at www.nbtbancorp.com/bn/presentations-events.html#events and will be archived for twelve months.

    Corporate Overview

    NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY, with total assets of $13.86 billion at March 31, 2025. The Company primarily operates through NBT Bank, N.A., a full-service community bank, and through two financial services companies. NBT Bank, N.A. has 157 banking locations in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, Maine and Connecticut. EPIC Retirement Plan Services, based in Rochester, NY, is a national benefits administration firm. NBT Insurance Agency, LLC, based in Norwich, NY, is a full-service insurance agency. More information about NBT and its divisions is available online at: www.nbtbancorp.com, www.nbtbank.com, www.epicrps.com and www.nbtbank.com/Insurance.

    Forward-Looking Statements

    This press release contains forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of phrases such as “anticipate,” “believe,” “expect,” “forecasts,” “projects,” “will,” “can,” “would,” “should,” “could,” “may,” or other similar terms. There are a number of factors, many of which are beyond the Company’s control, that could cause actual results to differ materially from those contemplated by the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) local, regional, national and international economic conditions, including actual or potential stress in the banking industry, and the impact they may have on the Company and its customers, and the Company’s assessment of that impact; (2) changes in the level of nonperforming assets and charge-offs; (3) changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; (4) the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board (“FRB”) and international trade disputes (including threatened or implemented tariffs imposed by the U.S. and threatened or implemented tariffs imposed by foreign countries in retaliation); (5) inflation, interest rate, securities market and monetary fluctuations; (6) political instability; (7) acts of war, including international military conflicts, or terrorism; (8) the timely development and acceptance of new products and services and the perceived overall value of these products and services by users; (9) changes in consumer spending, borrowing and saving habits; (10) changes in the financial performance and/or condition of the Company’s borrowers; (11) technological changes; (12) acquisition and integration of acquired businesses; (13) the possibility that NBT and Evans may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes or at all or to successfully integrate Evans operations and those of NBT; (14) the ability to increase market share and control expenses; (15) changes in the competitive environment among financial holding companies; (16) the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which the Company and its subsidiaries must comply, including those under the Dodd-Frank Act, and the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018; (17) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters; (18) changes in the Company’s organization, compensation and benefit plans; (19) the costs and effects of legal and regulatory developments, including the resolution of legal proceedings or regulatory or other governmental inquiries, and the results of regulatory examinations or reviews; (20) greater than expected costs or difficulties related to the integration of new products and lines of business; and (21) the Company’s success at managing the risks involved in the foregoing items.

    The Company cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date made, and advises readers that various factors, including, but not limited to, those described above and other factors discussed in the Company’s annual and quarterly reports previously filed with the SEC, could affect the Company’s financial performance and could cause the Company’s actual results or circumstances for future periods to differ materially from those anticipated or projected.

    Unless required by law, the Company does not undertake, and specifically disclaims any obligations to, publicly release any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

    Non-GAAP Measures

    This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as a reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provide useful information that is important to an understanding of the results of the Company’s core business as well as provide information standard in the financial institution industry. Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Amounts previously reported in the consolidated financial statements are reclassified whenever necessary to conform to current period presentation.

    Contact: Scott A. Kingsley, President and CEO
      Annette L. Burns, Executive Vice President and CFO
      NBT Bancorp Inc.
      52 South Broad Street
      Norwich, NY 13815
      607-337-6589
       
    NBT Bancorp Inc. and Subsidiaries            
    Selected Financial Data            
    (unaudited, dollars in thousands except per share data)          
                 
        2025     2024    
      1st Q 4th Q 3rd Q 2nd Q 1st Q  
    Profitability (reported)            
    Diluted earnings per share $ 0.77   $ 0.76   $ 0.80   $ 0.69   $ 0.71    
    Weighted average diluted common shares outstanding   47,477,391     47,505,760     47,473,417     47,382,814     47,370,145    
    Return on average assets(3)   1.08 %   1.04 %   1.12 %   0.98 %   1.02 %  
    Return on average equity(3)   9.68 %   9.44 %   10.21 %   9.12 %   9.52 %  
    Return on average tangible common equity(1)(3)   13.63 %   13.36 %   14.54 %   13.23 %   13.87 %  
    Net interest margin(1)(3)   3.44 %   3.34 %   3.27 %   3.18 %   3.14 %  
                 
        2025     2024    
      1st Q 4th Q 3rd Q 2nd Q 1st Q  
    Profitability (operating)            
    Diluted earnings per share(1) $ 0.80   $ 0.77   $ 0.80   $ 0.69   $ 0.68    
    Return on average assets(1)(3)   1.11 %   1.06 %   1.12 %   0.98 %   0.97 %  
    Return on average equity(1)(3)   9.95 %   9.60 %   10.23 %   9.14 %   9.04 %  
    Return on average tangible common equity(1)(3)   13.99 %   13.57 %   14.56 %   13.26 %   13.20 %  
                 
        2025     2024    
      1st Q 4th Q 3rd Q 2nd Q 1st Q  
    Balance sheet data            
    Short-term interest-bearing accounts $ 37,385   $ 78,973   $ 231,671   $ 35,207   $ 156,632    
    Securities available for sale   1,704,677     1,574,664     1,509,338     1,439,445     1,418,471    
    Securities held to maturity   836,833     842,921     854,941     878,909     890,863    
    Net loans   9,863,267     9,853,910     9,787,541     9,733,847     9,572,777    
    Total assets   13,864,251     13,786,666     13,839,552     13,501,909     13,439,199    
    Total deposits   11,708,511     11,546,761     11,588,278     11,271,459     11,195,289    
    Total borrowings   312,977     414,983     456,666     476,082     518,190    
    Total liabilities   12,298,476     12,260,525     12,317,572     12,039,954     11,997,784    
    Stockholders’ equity   1,565,775     1,526,141     1,521,980     1,461,955     1,441,415    
                 
    Capital            
    Equity to assets   11.29 %   11.07 %   11.00 %   10.83 %   10.73 %  
    Tangible equity ratio(1)   8.68 %   8.42 %   8.36 %   8.11 %   7.98 %  
    Book value per share $ 33.13   $ 32.34   $ 32.26   $ 31.00   $ 30.57    
    Tangible book value per share(2) $ 24.74   $ 23.88   $ 23.83   $ 22.54   $ 22.07    
    Leverage ratio   10.39 %   10.24 %   10.29 %   10.16 %   10.09 %  
    Common equity tier 1 capital ratio   12.12 %   11.93 %   11.86 %   11.70 %   11.68 %  
    Tier 1 capital ratio   13.02 %   12.83 %   12.77 %   12.61 %   12.61 %  
    Total risk-based capital ratio   15.24 %   15.03 %   15.02 %   14.88 %   14.87 %  
    Common stock price (end of period) $ 42.90   $ 47.76   $ 44.23   $ 38.60   $ 36.68    
                 
    NBT Bancorp Inc. and Subsidiaries          
    Asset Quality and Consolidated Loan Balances          
    (unaudited, dollars in thousands)          
               
        2025     2024  
      1st Q 4th Q 3rd Q 2nd Q 1st Q
    Asset quality          
    Nonaccrual loans $ 44,829   $ 45,819   $ 33,338   $ 34,755   $ 35,189  
    90 days past due and still accruing   2,862     5,798     3,981     3,333     2,600  
    Total nonperforming loans   47,691     51,617     37,319     38,088     37,789  
    Other real estate owned   308     182     127     74      
    Total nonperforming assets   47,999     51,799     37,446     38,162     37,789  
    Allowance for loan losses   117,000     116,000     119,500     120,500     115,300  
               
    Asset quality ratios          
    Allowance for loan losses to total loans   1.17 %   1.16 %   1.21 %   1.22 %   1.19 %
    Total nonperforming loans to total loans   0.48 %   0.52 %   0.38 %   0.39 %   0.39 %
    Total nonperforming assets to total assets   0.35 %   0.38 %   0.27 %   0.28 %   0.28 %
    Allowance for loan losses to total nonperforming loans   245.33 %   224.73 %   320.21 %   316.37 %   305.12 %
    Past due loans to total loans(4)   0.32 %   0.34 %   0.36 %   0.30 %   0.33 %
    Net charge-offs to average loans(3)   0.27 %   0.23 %   0.16 %   0.15 %   0.19 %
               
        2025     2024  
      1st Q 4th Q 3rd Q 2nd Q 1st Q
    Loan net charge-offs by line of business          
    Commercial $ 2,109   $ 2,542   $ 807   $ (8 ) $ 772  
    Residential real estate and home equity   (25 )   (25 )   (64 )   (76 )   (32 )
    Indirect auto   1,155     675     725     747     665  
    Residential solar and other consumer   3,315     2,517     2,452     3,036     3,274  
      Total loan net charge-offs $ 6,554   $ 5,709   $ 3,920   $ 3,699   $ 4,679  
               
        2025     2024  
      1st Q 4th Q 3rd Q 2nd Q 1st Q
    Allowance for loan losses as a percentage of loans by segment        
    Commercial & industrial   0.76 %   0.73 %   0.73 %   0.76 %   0.79 %
    Commercial real estate   1.02 %   0.95 %   1.01 %   1.00 %   0.97 %
    Residential real estate   1.00 %   1.00 %   1.00 %   0.98 %   0.89 %
    Auto   0.72 %   0.81 %   0.83 %   0.85 %   0.81 %
    Residential solar and other consumer   3.61 %   3.64 %   3.69 %   3.78 %   3.63 %
      Total   1.17 %   1.16 %   1.21 %   1.22 %   1.19 %
               
        2025     2024  
      1st Q 4th Q 3rd Q 2nd Q 1st Q
    Loans by line of business          
    Commercial & industrial $ 1,436,990   $ 1,426,482   $ 1,458,926   $ 1,397,935   $ 1,353,446  
    Commercial real estate   3,890,115     3,876,698     3,792,498     3,784,214     3,646,739  
    Residential real estate   2,127,588     2,142,249     2,143,766     2,134,875     2,133,289  
    Home equity   331,400     334,268     328,687     326,556     328,673  
    Indirect auto   1,309,084     1,273,253     1,235,175     1,225,786     1,190,734  
    Residential solar and other consumer   885,090     916,960     947,989     984,981     1,035,196  
      Total loans $ 9,980,267   $ 9,969,910   $ 9,907,041   $ 9,854,347   $ 9,688,077  
               
    NBT Bancorp Inc. and Subsidiaries      
    Consolidated Balance Sheets      
    (unaudited, in thousands)      
           
      March 31, December 31,  
      2025 2024  
    Assets      
    Cash and due from banks $ 216,698 $ 205,083  
    Short-term interest-bearing accounts   37,385   78,973  
    Equity securities, at fair value   41,561   42,372  
    Securities available for sale, at fair value   1,704,677   1,574,664  
    Securities held to maturity (fair value $756,404 and $749,945, respectively)   836,833   842,921  
    Federal Reserve and Federal Home Loan Bank stock   32,117   33,957  
    Loans held for sale   13,628   9,744  
    Loans   9,980,267   9,969,910  
    Less allowance for loan losses   117,000   116,000  
      Net loans $ 9,863,267 $ 9,853,910  
    Premises and equipment, net   81,598   80,840  
    Goodwill   362,663   362,663  
    Intangible assets, net   34,249   36,360  
    Bank owned life insurance   271,723   272,657  
    Other assets   367,852   392,522  
    Total assets $ 13,864,251 $ 13,786,666  
           
    Liabilities and stockholders’ equity      
    Demand (noninterest bearing) $ 3,399,393 $ 3,446,068  
    Savings, NOW and money market   6,858,372   6,658,188  
    Time   1,450,746   1,442,505  
      Total deposits $ 11,708,511 $ 11,546,761  
    Short-term borrowings   85,597   162,942  
    Long-term debt   4,605   29,644  
    Subordinated debt, net   121,579   121,201  
    Junior subordinated debt   101,196   101,196  
    Other liabilities   276,988   298,781  
      Total liabilities $ 12,298,476 $ 12,260,525  
           
    Total stockholders’ equity $ 1,565,775 $ 1,526,141  
           
    Total liabilities and stockholders’ equity $ 13,864,251 $ 13,786,666  
           
    NBT Bancorp Inc. and Subsidiaries          
    Quarterly Consolidated Statements of Income          
    (unaudited, in thousands except per share data)          
               
        2025     2024  
      1st Q 4th Q 3rd Q 2nd Q 1st Q
    Interest, fee and dividend income          
    Interest and fees on loans $ 138,052   $ 141,103   $ 141,991 $ 136,606   $ 133,146  
    Securities available for sale   10,262     8,773     7,815   7,562     7,124  
    Securities held to maturity   4,914     4,931     5,042   5,190     5,303  
    Other   1,176     2,930     1,382   1,408     1,364  
      Total interest, fee and dividend income $ 154,404   $ 157,737   $ 156,230 $ 150,766   $ 146,937  
    Interest expense          
    Deposits $ 42,588   $ 46,815   $ 49,106 $ 46,688   $ 44,339  
    Short-term borrowings   866     918     1,431   2,899     3,421  
    Long-term debt   266     293     292   291     290  
    Subordinated debt   1,822     1,816     1,810   1,806     1,800  
    Junior subordinated debt   1,639     1,790     1,922   1,908     1,913  
      Total interest expense $ 47,181   $ 51,632   $ 54,561 $ 53,592   $ 51,763  
    Net interest income $ 107,223   $ 106,105   $ 101,669 $ 97,174   $ 95,174  
    Provision for loan losses   7,554     2,209     2,920   8,899     5,579  
      Net interest income after provision for loan losses $ 99,669   $ 103,896   $ 98,749 $ 88,275   $ 89,595  
    Noninterest income          
    Service charges on deposit accounts $ 4,243   $ 4,411   $ 4,340 $ 4,219   $ 4,117  
    Card services income   5,317     5,652     5,897   5,587     5,195  
    Retirement plan administration fees   15,858     12,924     14,578   14,798     14,287  
    Wealth management   10,946     10,842     10,929   10,173     9,697  
    Insurance services   4,761     3,883     4,913   3,848     4,388  
    Bank owned life insurance income   3,397     2,271     1,868   1,834     2,352  
    Net securities (losses) gains   (104 )   222     476   (92 )   2,183  
    Other   3,034     2,221     2,773   2,865     3,173  
      Total noninterest income $ 47,452   $ 42,426   $ 45,774 $ 43,232   $ 45,392  
    Noninterest expense          
    Salaries and employee benefits $ 60,694   $ 61,749   $ 59,641 $ 55,393   $ 55,704  
    Technology and data services   10,238     10,220     9,920   9,249     9,750  
    Occupancy   9,027     7,786     7,754   7,671     8,098  
    Professional fees and outside services   4,952     4,843     4,871   4,565     4,853  
    Amortization of intangible assets   2,111     2,080     2,062   2,133     2,168  
    Reserve for unfunded loan commitments   90     (125 )   250   (380 )   (450 )
    Acquisition expenses   1,221     988     543        
    Other   11,567     13,234     10,704   10,957     11,650  
      Total noninterest expense $ 99,900   $ 100,775   $ 95,745 $ 89,588   $ 91,773  
    Income before income tax expense $ 47,221   $ 45,547   $ 48,778 $ 41,919   $ 43,214  
    Income tax expense   10,476     9,542     10,681   9,203     9,391  
       Net income $ 36,745   $ 36,005   $ 38,097 $ 32,716   $ 33,823  
    Earnings Per Share          
    Basic $ 0.78   $ 0.76   $ 0.81 $ 0.69   $ 0.72  
    Diluted $ 0.77   $ 0.76   $ 0.80 $ 0.69   $ 0.71  
               
    NBT Bancorp Inc. and Subsidiaries                      
    Average Quarterly Balance Sheets                      
    (unaudited, dollars in thousands)                      
                           
        Average Balance Yield / Rates Average Balance Yield / Rates Average Balance Yield / Rates Average Balance Yield / Rates Average Balance Yield / Rates
        Q1 – 2025 Q4 – 2024 Q3 – 2024 Q2 – 2024 Q1 – 2024
    Assets                      
    Short-term interest-bearing accounts   $ 63,198 4.51 % $ 184,988 5.27 % $ 62,210 4.87 % $ 48,861 5.48 % $ 47,972 4.48 %
    Securities taxable(1)     2,402,772 2.30 %   2,317,034 2.10 %   2,266,930 1.99 %   2,280,767 1.97 %   2,278,029 1.91 %
    Securities tax-exempt(1)(5)     220,210 3.60 %   211,493 3.46 %   217,251 3.47 %   226,032 3.56 %   230,468 3.58 %
    FRB and FHLB stock     33,469 5.73 %   33,261 5.75 %   35,395 6.97 %   40,283 7.41 %   42,296 7.89 %
    Loans(1)(6)     9,981,487 5.62 %   9,957,879 5.65 %   9,865,412 5.74 %   9,772,014 5.63 %   9,674,892 5.54 %
    Total interest-earning assets   $ 12,701,136 4.95 % $ 12,704,655 4.96 % $ 12,447,198 5.01 % $ 12,367,957 4.92 % $ 12,273,657 4.84 %
    Other assets     1,088,069     1,093,419     1,072,277     1,064,487     1,055,386  
    Total assets   $ 13,789,205   $ 13,798,074   $ 13,519,475   $ 13,432,444   $ 13,329,043  
    Liabilities and stockholders’ equity                      
    Money market deposit accounts   $ 3,496,552 3.04 % $ 3,504,937 3.27 % $ 3,342,845 3.68 % $ 3,254,252 3.65 % $ 3,129,160 3.56 %
    NOW deposit accounts     1,682,265 0.84 %   1,664,960 0.91 %   1,600,547 0.87 %   1,603,695 0.78 %   1,600,288 0.75 %
    Savings deposits     1,571,673 0.05 %   1,561,703 0.05 %   1,566,316 0.05 %   1,586,753 0.05 %   1,607,659 0.04 %
    Time deposits     1,450,846 3.55 %   1,446,798 3.85 %   1,442,424 4.00 %   1,391,062 4.00 %   1,352,559 4.00 %
    Total interest-bearing deposits   $ 8,201,336 2.11 % $ 8,178,398 2.28 % $ 7,952,132 2.46 % $ 7,835,762 2.40 % $ 7,689,666 2.32 %
    Federal funds purchased     2,278 4.45 %       2,609 5.34 %   29,945 5.56 %   19,769 5.53 %
    Repurchase agreements     107,496 2.87 %   116,408 3.13 %   98,035 2.80 %   86,405 1.55 %   82,419 1.55 %
    Short-term borrowings     7,033 4.61 %   174 4.57 %   48,875 5.74 %   155,159 5.58 %   213,390 5.34 %
    Long-term debt     27,674 3.90 %   29,657 3.93 %   29,696 3.91 %   29,734 3.94 %   29,772 3.92 %
    Subordinated debt, net     121,331 6.09 %   120,967 5.97 %   120,594 5.97 %   120,239 6.04 %   119,873 6.04 %
    Junior subordinated debt     101,196 6.57 %   101,196 7.04 %   101,196 7.56 %   101,196 7.58 %   101,196 7.60 %
    Total interest-bearing liabilities   $ 8,568,344 2.23 % $ 8,546,800 2.40 % $ 8,353,137 2.60 % $ 8,358,440 2.58 % $ 8,256,085 2.52 %
    Demand deposits     3,385,080     3,438,194     3,389,894     3,323,906     3,356,607  
    Other liabilities     296,983     295,292     292,446     306,747     286,749  
    Stockholders’ equity     1,538,798     1,517,788     1,483,998     1,443,351     1,429,602  
    Total liabilities and stockholders’ equity   $ 13,789,205   $ 13,798,074   $ 13,519,475   $ 13,432,444   $ 13,329,043  
    Interest rate spread     2.72 %   2.56 %   2.41 %   2.34 %   2.32 %
    Net interest margin (FTE)(1)     3.44 %   3.34 %   3.27 %   3.18 %   3.14 %
                           
                 
    (1) The following tables provide the Non-GAAP reconciliations for the Non-GAAP measures contained in this release:  
                 
      Non-GAAP measures          
      (unaudited, dollars in thousands except per share data)          
                 
          2025     2024  
        1st Q 4th Q 3rd Q 2nd Q 1st Q
      Operating net income          
      Net income $ 36,745   $ 36,005   $ 38,097   $ 32,716   $ 33,823  
      Acquisition expenses   1,221     988     543          
      Securities losses (gains)   104     (222 )   (476 )   92     (2,183 )
      Adjustments to net income $ 1,325   $ 766   $ 67   $ 92   $ (2,183 )
      Adjustments to net income (net of tax) $ 1,020   $ 604   $ 52   $ 72   $ (1,703 )
      Operating net income $ 37,765   $ 36,609   $ 38,149   $ 32,788   $ 32,120  
      Operating diluted earnings per share $ 0.80   $ 0.77   $ 0.80   $ 0.69   $ 0.68  
                 
          2025     2024  
        1st Q 4th Q 3rd Q 2nd Q 1st Q
      FTE adjustment          
      Net interest income $ 107,223   $ 106,105   $ 101,669   $ 97,174   $ 95,174  
      Add: FTE adjustment   636     619     639     658     658  
      Net interest income (FTE) $ 107,859   $ 106,724   $ 102,308   $ 97,832   $ 95,832  
      Average earning assets $ 12,701,136   $ 12,704,655   $ 12,447,198   $ 12,367,957   $ 12,273,657  
      Net interest margin (FTE)(3)   3.44 %   3.34 %   3.27 %   3.18 %   3.14 %
                 
      Interest income for tax-exempt securities and loans have been adjusted to an FTE basis using the statutory Federal income tax rate of 21%.
                 
          2025     2024  
        1st Q 4th Q 3rd Q 2nd Q 1st Q
      Tangible equity to tangible assets          
      Total equity $ 1,565,775   $ 1,526,141   $ 1,521,980   $ 1,461,955   $ 1,441,415  
      Intangible assets   396,912     399,023     397,853     398,686     400,819  
      Total assets $ 13,864,451   $ 13,786,666   $ 13,839,552   $ 13,501,909   $ 13,439,199  
      Tangible equity to tangible assets   8.68 %   8.42 %   8.36 %   8.11 %   7.98 %
                 
          2025     2024  
        1st Q 4th Q 3rd Q 2nd Q 1st Q
      Return on average tangible common equity          
      Net income $ 36,745   $ 36,005   $ 38,097   $ 32,716   $ 33,823  
      Amortization of intangible assets (net of tax)   1,583     1,560     1,547     1,600     1,626  
      Net income, excluding intangibles amortization $ 38,328   $ 37,565   $ 39,644   $ 34,316   $ 35,449  
                 
      Average stockholders’ equity $ 1,538,798   $ 1,517,788   $ 1,483,998   $ 1,443,351   $ 1,429,602  
      Less: average goodwill and other intangibles   398,233     399,139     399,113     399,968     401,756  
      Average tangible common equity $ 1,140,565   $ 1,118,649   $ 1,084,885   $ 1,043,383   $ 1,027,846  
      Return on average tangible common equity(3)   13.63 %   13.36 %   14.54 %   13.23 %   13.87 %
                 
    (2) Non-GAAP measure – Stockholders’ equity less goodwill and intangible assets divided by common shares outstanding.  
    (3) Annualized.          
    (4) Total past due loans, defined as loans 30 days or more past due and in an accrual status.    
    (5) Securities are shown at average amortized cost.          
    (6) For purposes of these computations, nonaccrual loans and loans held for sale are included in the average loan balances outstanding.

    This press release was published by a CLEAR® Verified individual.

    The MIL Network

  • MIL-OSI: MidWestOne Financial Group, Inc. Reports Financial Results For the First Quarter of 2025

    Source: GlobeNewswire (MIL-OSI)

    IOWA CITY, Iowa, April 24, 2025 (GLOBE NEWSWIRE) — MidWestOne Financial Group, Inc. (Nasdaq: MOFG) (“we,” “our,” or the “Company”) today reported results for the first quarter of 2025.

    First Quarter 2025 Summary1

    • Net income of $15.1 million, or $0.73 per diluted common share.
      • Net interest margin (tax equivalent) was 3.44%;2 core net interest margin expanded 10 basis points (“bps”) to 3.36%.2
      • Noninterest expenses were $36.3 million; efficiency ratio was 59.38%.2
      • Return on average assets of 1.00%.
    • Criticized loans ratio improved 54 bps to 5.47%; nonperforming assets ratio improved 7 bps to 0.33%.
    • Tangible book value per share of $23.36,2 an increase of 4.4%.
    • Common equity tier 1 (“CET1”) capital ratio improved 24 bps to 10.97%.

    CEO Commentary

    Charles (Chip) Reeves, Chief Executive Officer of the Company, commented, “We are pleased with the continued execution of our strategic plan initiatives despite a more uncertain economic environment. Our return on average assets eclipsed 1% for the second straight quarter driven by disciplined balance sheet management, core net interest margin expansion of 10 bps2 and solid expense control. Loan growth was flat in the quarter, somewhat softer than anticipated, due to pay-offs and latter quarter market volatility. The majority of our asset quality metrics improved significantly, led by reductions in nonperforming assets and criticized loans. Net charge-offs increased to 29 basis points, with the majority of the increase due to a partial charge-off on a previously reserved CRE loan as we prepare for resolution. Driven by earnings and lower accumulated other comprehensive loss, tangible book value per share increased 4.4% to $23.362 and the CET1 ratio grew to 10.97%, edging closer to our target range of 11.0%-11.50%.

    Thank you to our team members who continued to execute well and serve our customers amidst market volatility. We are pleased with the transformation of our company and our solid foundation of increased capital, earnings power, asset quality, and a premium core deposit franchise position us well for uncertain economic times and the remainder of 2025.”

    1 First Quarter Summary compares to the fourth quarter of 2024 (the “linked quarter”) unless noted.
    2 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.

        As of or for the quarter ended
    (Dollars in thousands, except per share amounts and as noted)   March 31,   December 31,   March 31,
        2025       2024       2024  
    Financial Results            
    Revenue   $ 57,575     $ 59,775     $ 44,481  
    Credit loss expense     1,687       1,291       4,689  
    Noninterest expense     36,293       37,372       35,565  
    Net income     15,138       16,330       3,269  
    Adjusted earnings(3)     15,301       16,112       4,504  
    Per Common Share            
    Diluted earnings per share   $ 0.73     $ 0.78     $ 0.21  
    Adjusted earnings per share(3)     0.73       0.77       0.29  
    Book value     27.85       26.94       33.53  
    Tangible book value(3)     23.36       22.37       27.14  
    Balance Sheet & Credit Quality            
    Loans In millions   $ 4,304.2     $ 4,315.6     $ 4,414.6  
    Investment securities In millions     1,305.5       1,328.4       1,862.2  
    Deposits In millions     5,489.1       5,478.0       5,585.2  
    Net loan charge-offs In millions     3.1       0.7       0.2  
    Allowance for credit losses ratio     1.25 %     1.28 %     1.27 %
    Selected Ratios            
    Return on average assets     1.00 %     1.03 %     0.20 %
    Net interest margin, tax equivalent(3)     3.44 %     3.43 %     2.33 %
    Return on average equity     10.74 %     11.53 %     2.49 %
    Return on average tangible equity(3)     13.75 %     14.80 %     4.18 %
    Efficiency ratio(3)     59.38 %     59.06 %     71.28 %
                             

    REVENUE REVIEW

    Revenue               Change   Change
                  1Q25 vs   1Q25 vs
    (Dollars in thousands)   1Q25   4Q24   1Q24   4Q24   1Q24
    Net interest income   $           47,439   $         48,938   $        34,731   (3)%   37 %
    Noninterest income                 10,136               10,837                9,750   (6)%   4 %
    Total revenue, net of interest expense   $           57,575   $         59,775   $        44,481   (4)%   29 %
                                 

    Total revenue for the first quarter of 2025 decreased $2.2 million from the fourth quarter of 2024 due to lower net interest income and noninterest income during the quarter. When compared to the first quarter of 2024, total revenue increased $13.1 million, due to higher net interest income and higher noninterest income.

    Net interest income of $47.4 million for the first quarter of 2025 decreased $1.5 million from the fourth quarter of 2024, due to lower earning asset volumes and yields, partially offset by lower funding volumes and costs. When compared to the first quarter of 2024, net interest income increased $12.7 million, due to higher earning asset yields and lower funding volumes and costs, partially offset by lower earning asset volumes.

    The Company’s tax equivalent net interest margin was 3.44%3 in the first quarter of 2025, compared to 3.43%3 in the fourth quarter of 2024, driven by lower funding costs, partially offset by a decline in earning asset yields. Interest bearing liability costs during the first quarter of 2025 decreased 11 bps to 2.41%, due to reductions of short-term borrowings, interest bearing deposits, and long-term debt costs of 78 bps, 10 bps, and 7 bps, to 3.75%, 2.31%, and 6.41%, respectively, from the fourth quarter of 2024.

    The Company’s tax equivalent net interest margin was 3.44%3 in the first quarter of 2025, compared to 2.33%3 in the first quarter of 2024, driven by higher earning asset yields and lower interest-bearing liability costs. Total earning assets yield increased 79 bps from the first quarter of 2024, primarily due to increases of 192 bps and 20 bps in total investment securities and loan yields, respectively. Interest bearing liability costs decreased 34 bps to 2.41%, due to short-term borrowing costs of 3.75%, long-term debt costs of 6.41%, and interest-bearing deposit costs of 2.31%, which decreased 107 bps, 45 bps, and 14 bps, respectively, from the first quarter of 2024.

    3 Non-GAAP measure. See the separate Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.

    Noninterest Income             Change   Change
                1Q25 vs   1Q25 vs
    (In thousands) 1Q25   4Q24   1Q24   4Q24   1Q24
    Investment services and trust activities $ 3,544     $ 3,779   $ 3,503     (6)%   1 %
    Service charges and fees   2,131       2,159     2,144     (1)%   (1)%
    Card revenue   1,744       1,833     1,943     (5)%   (10)%
    Loan revenue   1,194       1,841     856     (35)%   39 %
    Bank-owned life insurance   1,057       719     660     47 %   60 %
    Investment securities gains, net   33       161     36     (80)%   (8)%
    Other   433       345     608     26 %   (29)%
    Total noninterest income $ 10,136     $ 10,837   $ 9,750     (6)%   4 %
                       
    MSR adjustment (included above in Loan revenue) $ (213 )   $ 164   $ (368 )   (230)%   (42)%
                                 

    Noninterest income for the first quarter of 2025 decreased $0.7 million from the linked quarter, primarily due to declines of $0.6 million and $0.2 million in loan revenue and investment services and trust activities revenue, respectively. The decrease in loan revenue was reflective of an unfavorable change in the fair value of our mortgage servicing rights of $0.4 million, coupled with a decrease in Small Business Administration (“SBA”) gain on sale revenue of $0.3 million. The decrease in investment services and trust activities revenue was driven by a decline in assets under administration due to market volatility. Partially offsetting these decreases was an increase of $0.3 million in bank-owned life insurance revenue, due primarily to $0.4 million of death benefit recognized in the first quarter of 2025.

    Noninterest income for the first quarter of 2025 increased $0.4 million from the first quarter of 2024 due primarily to increases of $0.4 million and $0.3 million in bank-owned life insurance and loan revenue, respectively. The bank-owned life insurance increase was due primarily to the death benefit noted above. The increase in loan revenue was due primarily to the mortgage servicing right valuation adjustment, coupled with higher SBA gain on sale revenue and other loan income. Partially offsetting these increases were decreases of $0.2 million in each of card revenue and other revenue.

    EXPENSE REVIEW

    Noninterest Expense             Change   Change
                1Q25 vs   1Q25 vs
    (In thousands) 1Q25   4Q24   1Q24   4Q24   1Q24
    Compensation and employee benefits $ 21,212   $ 20,684   $ 20,930   3 %   1 %
    Occupancy expense of premises, net   2,588     2,772     2,813   (7)%   (8)%
    Equipment   2,426     2,688     2,600   (10)%   (7)%
    Legal and professional   2,226     2,534     2,059   (12)%   8 %
    Data processing   1,698     1,719     1,360   (1)%   25 %
    Marketing   552     793     598   (30)%   (8)%
    Amortization of intangibles   1,408     1,449     1,637   (3)%   (14)%
    FDIC insurance   917     980     942   (6)%   (3)%
    Communications   159     154     196   3 %   (19)%
    Foreclosed assets, net   74     56     358   32 %   (79)%
    Other   3,033     3,543     2,072   (14)%   46 %
         Total noninterest expense $ 36,293   $ 37,372   $ 35,565   (3)%   2 %
                               
    Merger-related Expenses          
             
    (In thousands) 1Q25   4Q24   1Q24
    Compensation and employee benefits $                 —   $                 —   $               241
    Occupancy expense of premises, net                     —                       —                     152
    Equipment                     —                       21                     149
    Legal and professional                     40                       —                     573
    Data processing                     —                       10                       61
    Marketing                     —                       —                       32
    Communications                     —                       —                         1
    Other                     —                       —                     105
    Total merger-related expenses $                 40   $                 31   $            1,314
                     

    Noninterest expense for the first quarter of 2025 decreased $1.1 million from the linked quarter, primarily due to decreases in other noninterest expense, legal and professional, equipment, and occupancy expense of premises, net, of $0.5 million, $0.3 million, $0.3 million, and $0.2 million, respectively. The primary drivers of the decrease in other noninterest expense were declines in fraud loss expense of $0.3 million and customer deposit costs of $0.1 million. The $0.3 million decrease in legal and professional expense was primarily driven by lower litigation-related legal costs. The decrease in equipment of $0.3 million was primarily driven by fewer small equipment purchases, while the decrease in occupancy expense of premises, net was due primarily to lower property tax expense. Partially offsetting these decreases was an increase of $0.5 million in compensation and employee benefits which reflected an increase in equity compensation and payroll tax expenses.

    Noninterest expense for the first quarter of 2025 increased $0.7 million from the first quarter of 2024 primarily due to increases in other noninterest expense, data processing, and compensation and employee benefits of $1.0 million, $0.3 million and $0.3 million, respectively. The increase in other noninterest expense was due primarily to customer deposit costs while the increase in data processing was driven core banking system costs. The increase in compensation and employee benefits was primarily driven by medical benefits expenses, wages expense, and incentive expense due to improved performance. Partially offsetting these identified increases was a decline of $1.3 million in merger-related expenses.

    The Company’s effective tax rate was 22.7% in the first quarter of 2025 and the linked quarter. The effective income tax rate for the full year 2025 is expected to be 22-23%.

    BALANCE SHEET REVIEW

    Total assets were $6.25 billion at March 31, 2025, compared to $6.24 billion at December 31, 2024 and $6.75 billion at March 31, 2024. The increase from December 31, 2024 was primarily due to higher cash balances, partially offset by lower securities balances. Compared to March 31, 2024, the decrease was primarily driven by the sale of assets associated with our Florida banking operations in the second quarter of 2024 coupled with the pay-off of Bank Term Funding Program (“BTFP”) borrowings with proceeds received from securities sales transactions in the fourth quarter of 2024.

    Loans Held for Investment March 31, 2025   December 31, 2024   March 31, 2024  
    (Dollars in thousands) Balance   % of Total   Balance   % of Total   Balance   % of Total  
    Commercial and industrial $1,140,138   26.5 % $1,126,813   26.1 % $1,105,718   25.0 %
    Agricultural 131,409   3.1   119,051   2.8   113,029   2.6  
    Commercial real estate                        
    Construction and development 293,280   6.8   324,896   7.5   403,571   9.1  
    Farmland 180,633   4.2   182,460   4.2   184,109   4.2  
    Multifamily 421,204   9.8   423,157   9.8   409,504   9.3  
    Other 1,425,062   33.0   1,414,168   32.7   1,440,645   32.7  
    Total commercial real estate 2,320,179   53.8   2,344,681   54.2   2,437,829   55.3  
    Residential real estate                        
    One-to-four family first liens 471,688   11.0   477,150   11.1   495,408   11.2  
    One-to-four family junior liens 182,346   4.2   179,232   4.2   182,001   4.1  
    Total residential real estate 654,034   15.2   656,382   15.3   677,409   15.3  
    Consumer 58,424   1.4   68,700   1.6   80,661   1.8  
    Loans held for investment, net of unearned income $4,304,184   100.0 % $4,315,627   100.0 % $4,414,646   100.0 %
                             
    Total commitments to extend credit $1,080,300       $1,080,737       $1,230,612      

    Loans held for investment, net of unearned income, decreased $11.4 million, or 0.3%, to $4.30 billion from $4.32 billion at December 31, 2024, primarily due to the reclassification of $11.0 million of credit card receivables to loans held for sale in the first quarter of 2025. Management expects the credit card portfolio sale to close in the fourth quarter of 2025.

    Loans held for investment, net of unearned income, decreased $110.5 million, or 2.5%, to $4.30 billion from $4.41 billion at March 31, 2024. The decrease from the first quarter of 2024 was driven primarily by the sale of loans associated with our Florida banking operations in the second quarter of 2024, partially offset by organic loan growth and higher line of credit usage.

    Investment Securities March 31, 2025   December 31, 2024   March 31, 2024  
    (Dollars in thousands) Balance   % of Total   Balance   % of Total   Balance   % of Total  
    Available for sale $1,305,530   100.0 % $1,328,433   100.0 % $797,230   42.8 %
    Held to maturity   %   % 1,064,939   57.2 %
    Total investment securities $1,305,530       $1,328,433       $1,862,169      

    Investment securities at March 31, 2025 were $1.31 billion, decreasing $22.9 million from December 31, 2024 and decreasing $556.6 million from March 31, 2024. The decrease from the fourth quarter of 2024 was primarily due to principal cash flows received from scheduled payments, calls, and maturities. The decrease from the first quarter of 2024 stemmed primarily from the sale of debt securities in connection with a balance sheet repositioning, as well as principal cash flows received from scheduled payments, calls, and maturities. 

    Deposits March 31, 2025   December 31, 2024   March 31, 2024  
    (Dollars in thousands) Balance   % of Total   Balance   % of Total   Balance   % of Total  
    Noninterest bearing deposits $903,714   16.5 % $951,423   17.4 % $920,764   16.5 %
    Interest checking deposits 1,283,328   23.3   1,258,191   22.9   1,349,823   24.2  
    Money market deposits 1,002,066   18.3   1,053,988   19.2   1,122,717   20.1  
    Savings deposits 877,348   16.0   820,549   15.0   728,276   13.0  
    Time deposits of $250 and under 818,012   14.9   826,793   15.1   787,851   14.1  
    Total core deposits 4,884,468   89.0   4,910,944   89.6   4,909,431   87.9  
    Brokered time deposits 200,000   3.6   200,000   3.7   205,000   3.7  
    Time deposits over $250 404,674   7.4   367,038   6.7   470,805   8.4  
    Total deposits $5,489,142   100.0 % $5,477,982   100.0 % $5,585,236   100.0 %

    Total deposits increased $11.2 million, or 0.2%, to $5.49 billion, from $5.48 billion at December 31, 2024. Total deposits decreased $96.1 million, or 1.7%, from $5.59 billion at March 31, 2024, primarily due to the deposits transferred in the sale of our Florida banking operations, partially offset by organic deposit growth in our targeted metropolitan markets.

    Borrowed Funds March 31, 2025   December 31, 2024   March 31, 2024  
    (Dollars in thousands) Balance   % of Total   Balance   % of Total   Balance   % of Total  
    Short-term borrowings $1,482   1.3 % $3,186   2.7 % $422,988   77.6 %
    Long-term debt 111,398   98.7 % 113,376   97.3 % 122,066   22.4 %
    Total borrowed funds $112,880       $116,562       $545,054      

    Borrowed funds were $112.9 million at March 31, 2025, a decrease of $3.7 million from December 31, 2024 and a decrease of $432.2 million from March 31, 2024. The decrease compared to the linked quarter was due to lower customer repurchase agreement volumes and scheduled payments on long-term debt. The decrease compared to March 31, 2024 was primarily due to the pay-off of $405.0 million of BTFP borrowings and $13.0 million of a revolving credit facility, as well as scheduled payments on long-term debt.

    Capital March 31,   December 31,   March 31,
    (Dollars in thousands) 2025 (1)     2024       2024  
    Total shareholders’ equity $ 579,625     $ 559,696     $ 528,040  
    Accumulated other comprehensive loss   (63,098 )     (72,762 )     (60,804 )
    MidWestOneFinancial Group, Inc. Consolidated          
    Tier 1 leverage to average assets ratio   9.50 %     9.15 %     8.16 %
    Common equity tier 1 capital to risk-weighted assets ratio   10.97 %     10.73 %     8.98 %
    Tier 1 capital to risk-weighted assets ratio   11.84 %     11.59 %     9.75 %
    Total capital to risk-weighted assets ratio   14.34 %     14.07 %     11.97 %
    MidWestOneBank          
    Tier 1 leverage to average assets ratio   10.42 %     10.12 %     9.36 %
    Common equity tier 1 capital to risk-weighted assets ratio   13.02 %     12.86 %     11.20 %
    Tier 1 capital to risk-weighted assets ratio   13.02 %     12.86 %     11.20 %
    Total capital to risk-weighted assets ratio   14.21 %     14.02 %     12.25 %
    (1) Regulatory capital ratios for March 31, 2025 are preliminary          
               

    Total shareholders’ equity at March 31, 2025 increased $19.9 million from December 31, 2024, driven primarily by an increase in retained earnings and a decrease in accumulated other comprehensive loss. Total shareholders’ equity at March 31, 2025 increased $51.6 million from March 31, 2024, primarily due to increases in common stock and additional pain-in-capital stemming from the common equity capital raise in the third quarter of 2024, partially offset by a decrease in retained earnings.

    On April 22, 2025, the Board of Directors of the Company declared a cash dividend of $0.2425 per common share. The dividend is payable June 16, 2025, to shareholders of record at the close of business on June 2, 2025.

    No common shares were repurchased by the Company during the period December 31, 2024 through March 31, 2025 or for the subsequent period through April 24, 2025. The current share repurchase program allows for the repurchase of up to $15.0 million of the Company’s common shares. As of March 31, 2025, $15.0 million remained available under this program.

    CREDIT QUALITY REVIEW

    Credit Quality As of or For the Three Months Ended
    March 31,   December 31,   March 31,
    (Dollars in thousands)   2025       2024       2024  
    Credit loss expense related to loans $ 1,787     $ 1,891     $ 4,589  
    Net charge-offs   3,087       691       189  
    Allowance for credit losses   53,900       55,200       55,900  
    Pass $ 4,068,707     $ 4,056,361     $ 4,098,102  
    Special Mention   121,494       148,462       152,604  
    Classified   113,983       110,804       163,940  
    Criticized   235,477       259,266       316,544  
    Loans greater than 30 days past due and accruing $ 6,119     $ 9,378     $ 8,772  
    Nonperforming loans $ 17,470     $ 21,847     $ 29,267  
    Nonperforming assets   20,889       25,184       33,164  
    Net charge-off ratio(1)   0.29 %     0.06 %     0.02 %
    Classified loans ratio(2)   2.65 %     2.57 %     3.71 %
    Criticized loans ratio(3)   5.47 %     6.01 %     7.17 %
    Nonperforming loans ratio(4)   0.41 %     0.51 %     0.66 %
    Nonperforming assets ratio(5)   0.33 %     0.40 %     0.49 %
    Allowance for credit losses ratio(6)   1.25 %     1.28 %     1.27 %
    Allowance for credit losses to nonaccrual loans ratio(7)   309.47 %     254.32 %     197.53 %
    (1) Net charge-off ratio is calculated as annualized net charge-offs divided by the sum of average loans held for investment, net of unearned income and average loans held for sale, during the period.
    (2) Classified loans ratio is calculated as classified loans divided by loans held for investment, net of unearned income, at the end of the period.
    (3) Criticized loans ratio is calculated as criticized loans divided by loans held for investment, net of unearned income, at the end of the period.
    (4) Nonperforming loans ratio is calculated as nonperforming loans divided by loans held for investment, net of unearned income, at the end of the period.
    (5) Nonperforming assets ratio is calculated as nonperforming assets divided by total assets at the end of the period.
    (6) Allowance for credit losses ratio is calculated as allowance for credit losses divided by loans held for investment, net of unearned income, at the end of the period.
    (7) Allowance for credit losses to nonaccrual loans ratio is calculated as allowance for credit losses divided by nonaccrual loans at the end of the period.
     

    Nonperforming loans and nonperforming assets ratios improved 10 bps and 7 bps, to 0.41% and 0.33%, respectively, compared to the linked quarter. In addition, special mention loan balances decreased $27.0 million, or 18%, while classified loan balances remained relatively stable with an increase of $3.2 million, or 3%. When compared to the same period of the prior year, the nonperforming loans and nonperforming asset ratios improved 25 bps and 16 bps, respectively, while the classified loan ratio improved 106 bps. Special mention loan balances decreased $31.1 million, or 20%. The net charge-off ratio increased 23 bps from the linked quarter and 27 bps from the same period in the prior year.

    As of March 31, 2025, the allowance for credit losses was $53.9 million and the allowance for credit losses ratio was 1.25%, compared with $55.2 million and 1.28%, respectively, at December 31, 2024. Credit loss expense of $1.7 million in the first quarter of 2025 primarily reflected additional reserve on pooled loans, offset by a reduction of $0.1 million in the reserve for unfunded loan commitments.

    Nonperforming Loans Roll Forward Nonaccrual   90+ Days Past Due
    & Still Accruing
      Total
    (Dollars in thousands)    
    Balance at December 31, 2024 $21,705   $142   $21,847
    Loans placed on nonaccrual or 90+ days past due & still accruing 3,121   225   3,346
    Proceeds related to repayment or sale (4,158)     (4,158)
    Loans returned to accrual status or no longer past due (336)   (49)   (385)
    Charge-offs (2,774)   (259)   (3,033)
    Transfers to foreclosed assets (141)     (141)
    Transfer to nonaccrual   (6)   (6)
    Balance at March 31, 2025 $17,417   $53   $17,470


    CONFERENCE CALL DETAILS

    The Company will host a conference call for investors at 11:00 a.m. CT on Friday, April 25, 2025. To participate, you may pre-register for this call utilizing the following link: https://www.netroadshow.com/events/login?show=29396e9f&confId=80376. After pre-registering for this event you will receive your access details via email. On the day of the call, you are also able to dial 1-833-470-1428 using an access code of 527448 at least fifteen minutes before the call start time. If you are unable to participate on the call, a replay will be available until July 24, 2025 by calling 1-866-813-9403 and using the replay access code of 162684. A transcript of the call will also be available on the Company’s web site (www.midwestonefinancial.com) within three business days of the call.

    ABOUT MIDWESTONE FINANCIAL GROUP, INC.

    MidWestOne Financial Group, Inc. is a financial holding company headquartered in Iowa City, Iowa. MidWestOne is the parent company of MidWestOne Bank, which operates banking offices in Iowa, Minnesota, Wisconsin, and Colorado. MidWestOne provides electronic delivery of financial services through its website, MidWestOne.bank. MidWestOne Financial Group, Inc. trades on the Nasdaq Global Select Market under the symbol “MOFG”.

    Cautionary Note Regarding Forward-Looking Statements

    This release contains certain “forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. We and our representatives may, from time to time, make written or oral statements that are “forward-looking” and provide information other than historical information. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any results, levels of activity, performance or achievements expressed or implied by any forward-looking statement. These factors include, among other things, the factors listed below. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “should,” “could,” “would,” “plans,” “goals,” “intend,” “project,” “estimate,” “forecast,” “may” or similar expressions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, these statements. Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Additionally, we undertake no obligation to update any statement in light of new information or future events, except as required under federal securities law.

    Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have an impact on our ability to achieve operating results, growth plan goals and future prospects include, but are not limited to, the following: (1) the effects of changes in interest rates, including on our net income and the value of our securities portfolio; (2) fluctuations in the value of our investment securities; (3) effects on the U.S. economy resulting from the implementation of proposed policies and executive orders, including the imposition of tariffs, changes in immigration policy, changes to regulatory or other governmental agencies, changes in foreign policy and tax regulations; (4) volatility of rate-sensitive deposits; (5) asset/liability matching risks and liquidity risks; (6) the ability to successfully manage liquidity risk, which may increase dependence on non-core funding sources such as brokered deposits, and may negatively impact the Company’s cost of funds; (7) the concentration of large deposits from certain clients, including those who have balances above current FDIC insurance limits; (8) credit quality deterioration, pronounced and sustained reduction in real estate market values, or other uncertainties, including the impact of inflationary pressures and future monetary policies of the Federal Reserve in response thereto on economic conditions and our business, resulting in an increase in the allowance for credit losses, an increase in the credit loss expense, and a reduction in net earnings; (9) the sufficiency of the allowance for credit losses to absorb the amount of expected losses inherent in our existing loan portfolio; (10) the failure of assumptions underlying the establishment of allowances for credit losses and estimation of values of collateral and various financial assets and liabilities; (11) credit risks and risks from concentrations (by type of borrower, collateral, geographic area and by industry) within our loan portfolio; (12) changes in the economic environment, competition, or other factors that may affect our ability to acquire loans or influence the anticipated growth rate of loans and deposits and the quality of the loan portfolio and loan and deposit pricing; (13) governmental monetary and fiscal policies; (14) new or revised general economic, political, or industry conditions, nationally, internationally or in the communities in which we conduct business, including the risk of a recession; (15) the imposition of domestic or foreign tariffs or other governmental policies impacting the global supply chain and value of the agricultural or other products of our borrowers; (16) war or terrorist activities, including ongoing conflicts in the Middle East and the Russian invasion of Ukraine, widespread disease or pandemic, or other adverse external events, which may cause deterioration in the economy or cause instability in credit markets; (17) legislative and regulatory changes, including changes in banking, securities, trade, and tax laws and regulations and their application by our regulators, and including changes in interpretation or prioritization of such laws and regulations; (18) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies and the Financial Accounting Standards Board; (19) the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds, financial technology companies, and other financial institutions operating in our markets or elsewhere or providing similar services; (20) changes in the business and economic conditions generally and in the financial services industry, and the effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in prior bank failures; (21) the occurrence of fraudulent activity, breaches, or failures of our or our third party vendors’ information security controls or cyber-security related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools or as a result of insider fraud; (22) the ability to attract and retain key executives and employees experienced in banking and financial services; (23) our ability to adapt successfully to technological changes to compete effectively in the marketplace; (24) operational risks, including data processing system failures and fraud; (25) the costs, effects and outcomes of existing or future litigation or other legal proceedings and regulatory actions; (26) the risks of mergers or branch sales (including the sale of our Florida banking operations and the acquisition of Denver Bankshares, Inc.), including, without limitation, the related time and costs of implementing such transactions, integrating operations as part of these transactions and possible failures to achieve expected gains, revenue growth and/or expense savings from such transactions; (27) the economic impacts on the Company and its customers of climate change, natural disasters and exceptional weather occurrences, such as: tornadoes, floods and blizzards; and (28) other risk factors detailed from time to time in Securities and Exchange Commission filings made by the Company.

    MIDWESTONE FINANCIAL GROUP, INC.
    FIVE QUARTER CONSOLIDATED BALANCE SHEETS

      March 31,   December 31,   September 30,   June 30,   March 31,
    (In thousands)   2025       2024       2024       2024       2024  
    ASSETS                  
    Cash and due from banks $            68,545     $            71,803     $            72,173     $            66,228     $            68,430  
    Interest earning deposits in banks              182,360                  133,092                  129,695                    35,340                    29,328  
    Federal funds sold                       —                           —                           —                           —                            4  
    Total cash and cash equivalents              250,905                  204,895                  201,868                  101,568                    97,762  
    Debt securities available for sale at fair value           1,305,530               1,328,433               1,623,104                  771,034                  797,230  
    Held to maturity securities at amortized cost                       —                           —                           —               1,053,080               1,064,939  
    Total securities           1,305,530               1,328,433               1,623,104               1,824,114               1,862,169  
    Loans held for sale                13,836                         749                      3,283                      2,850                      2,329  
    Gross loans held for investment           4,315,546               4,328,413               4,344,559               4,304,619               4,433,258  
    Unearned income, net              (11,362 )                (12,786 )                (15,803 )                (17,387 )                (18,612 )
    Loans held for investment, net of unearned income           4,304,184               4,315,627               4,328,756               4,287,232               4,414,646  
    Allowance for credit losses              (53,900 )                (55,200 )                (54,000 )                (53,900 )                (55,900 )
    Total loans held for investment, net           4,250,284               4,260,427               4,274,756               4,233,332               4,358,746  
    Premises and equipment, net                90,031                    90,851                    90,750                    91,793                    95,986  
    Goodwill                69,788                    69,788                    69,788                    69,388                    71,118  
    Other intangible assets, net                23,611                    25,019                    26,469                    27,939                    29,531  
    Foreclosed assets, net                  3,419                      3,337                      3,583                      6,053                      3,897  
    Other assets              246,990                  252,830                  258,881                  224,621                  226,477  
    Total assets $       6,254,394     $       6,236,329     $       6,552,482     $       6,581,658     $       6,748,015  
    LIABILITIES                       
    Noninterest bearing deposits $          903,714     $          951,423     $          917,715     $          882,472     $          920,764  
    Interest bearing deposits           4,585,428               4,526,559               4,451,012               4,529,947               4,664,472  
    Total deposits           5,489,142               5,477,982               5,368,727               5,412,419               5,585,236  
    Short-term borrowings                  1,482                      3,186                  410,630                  414,684                  422,988  
    Long-term debt              111,398                  113,376                  115,051                  114,839                  122,066  
    Other liabilities                72,747                    82,089                    95,836                    96,430                    89,685  
    Total liabilities           5,674,769               5,676,633               5,990,244               6,038,372               6,219,975  
    SHAREHOLDERS’ EQUITY                       
    Common stock                21,580                    21,580                    21,580                    16,581                    16,581  
    Additional paid-in capital              414,258                  414,987                  414,965                  300,831                  300,845  
    Retained earnings              227,790                  217,776                  206,490                  306,030                  294,066  
    Treasury stock              (20,905 )                (21,885 )                (21,955 )                (22,021 )                (22,648 )
    Accumulated other comprehensive loss              (63,098 )                (72,762 )                (58,842 )                (58,135 )                (60,804 )
    Total shareholders’ equity              579,625                  559,696                  562,238                  543,286                  528,040  
    Total liabilities and shareholders’ equity $       6,254,394     $       6,236,329     $       6,552,482     $       6,581,658     $       6,748,015  
                                           

    MIDWESTONE FINANCIAL GROUP, INC.
    FIVE QUARTER CONSOLIDATED STATEMENTS OF INCOME

      Three Months Ended
      March 31,   December 31,   September 30,   June 30,   March 31,
    (In thousands, except per share data)   2025     2024     2024       2024     2024
    Interest income                  
    Loans, including fees $            59,462   $            62,458   $            62,521     $            61,643   $            57,947
    Taxable investment securities                13,327                  11,320                   8,779                     9,228                   9,460
    Tax-exempt investment securities                    703                      728                   1,611                     1,663                   1,710
    Other                 1,247                   3,761                      785                        242                      418
    Total interest income                74,739                  78,267                  73,696                    72,776                  69,535
    Interest expense                  
    Deposits                25,484                  27,324                  29,117                    28,942                  27,726
    Short-term borrowings                      25                      115                   5,043                     5,409                   4,975
    Long-term debt                 1,791                   1,890                   2,015                     2,078                   2,103
    Total interest expense                27,300                  29,329                  36,175                    36,429                  34,804
    Net interest income                47,439                  48,938                  37,521                    36,347                  34,731
    Credit loss expense                 1,687                   1,291                   1,535                     1,267                   4,689
    Net interest income after credit loss expense                45,752                  47,647                  35,986                    35,080                  30,042
    Noninterest income                  
    Investment services and trust activities                 3,544                   3,779                   3,410                     3,504                   3,503
    Service charges and fees                 2,131                   2,159                   2,170                     2,156                   2,144
    Card revenue                 1,744                   1,833                   1,935                     1,907                   1,943
    Loan revenue                 1,194                   1,841                      760                     1,525                      856
    Bank-owned life insurance                 1,057                      719                      879                        668                      660
    Investment securities gains (losses), net                      33                      161              (140,182 )                        33                        36
    Other                    433                      345                      640                    11,761                      608
    Total noninterest income (loss)                10,136                  10,837              (130,388 )                  21,554                   9,750
    Noninterest expense                  
    Compensation and employee benefits                21,212                  20,684                  19,943                    20,985                  20,930
    Occupancy expense of premises, net                 2,588                   2,772                   2,443                     2,435                   2,813
    Equipment                 2,426                   2,688                   2,486                     2,530                   2,600
    Legal and professional                 2,226                   2,534                   2,261                     2,253                   2,059
    Data processing                 1,698                   1,719                   1,580                     1,645                   1,360
    Marketing                    552                      793                      619                        636                      598
    Amortization of intangibles                 1,408                   1,449                   1,470                     1,593                   1,637
    FDIC insurance                    917                      980                      923                     1,051                      942
    Communications                    159                      154                      159                        191                      196
    Foreclosed assets, net                      74                        56                      330                        138                      358
    Other                 3,033                   3,543                   3,584                     2,304                   2,072
    Total noninterest expense                36,293                  37,372                  35,798                    35,761                  35,565
    Income (loss) before income tax expense                19,595                  21,112              (130,200 )                  20,873                   4,227
    Income tax expense (benefit)                 4,457                   4,782                (34,493 )                   5,054                      958
    Net income (loss) $            15,138   $            16,330   $          (95,707 )   $            15,819   $             3,269
                       
    Earnings (loss) per common share                  
    Basic $               0.73   $               0.79   $              (6.05 )   $               1.00   $               0.21
    Diluted $               0.73   $               0.78   $              (6.05 )   $               1.00   $               0.21
    Weighted average basic common shares outstanding                20,797                  20,776                  15,829                    15,763                  15,723
    Weighted average diluted common shares outstanding                20,849                  20,851                  15,829                    15,781                  15,774
    Dividends paid per common share $            0.2425   $            0.2425   $            0.2425     $            0.2425   $            0.2425
                                   

    MIDWESTONE FINANCIAL GROUP, INC.
    FINANCIAL STATISTICS

      As of or for the Three Months Ended
      March 31,   December 31,   March 31,
    (Dollars in thousands, except per share amounts)   2025       2024       2024  
    Earnings:          
    Net interest income $ 47,439     $ 48,938     $ 34,731  
    Noninterest income   10,136       10,837       9,750  
    Total revenue, net of interest expense   57,575       59,775       44,481  
    Credit loss expense   1,687       1,291       4,689  
    Noninterest expense   36,293       37,372       35,565  
    Income before income tax expense   19,595       21,112       4,227  
    Income tax expense   4,457       4,782       958  
    Net income $ 15,138     $ 16,330     $ 3,269  
    Adjusted earnings(1) $ 15,301     $ 16,112     $ 4,504  
    Per Share Data:          
    Diluted earnings $ 0.73     $ 0.78     $ 0.21  
    Adjusted earnings(1)   0.73       0.77       0.29  
    Book value   27.85       26.94       33.53  
    Tangible book value(1)   23.36       22.37       27.14  
    Ending Balance Sheet:          
    Total assets $ 6,254,394     $ 6,236,329     $ 6,748,015  
    Loans held for investment, net of unearned income   4,304,184       4,315,627       4,414,646  
    Total securities   1,305,530       1,328,433       1,862,169  
    Total deposits   5,489,142       5,477,982       5,585,236  
    Short-term borrowings   1,482       3,186       422,988  
    Long-term debt   111,398       113,376       122,066  
    Total shareholders’ equity   579,625       559,696       528,040  
    Average Balance Sheet:          
    Average total assets $ 6,168,546     $ 6,279,975     $ 6,635,379  
    Average total loans   4,290,710       4,307,583       4,298,216  
    Average total deposits   5,398,819       5,464,900       5,481,114  
    Financial Ratios:          
    Return on average assets   1.00 %     1.03 %     0.20 %
    Return on average equity   10.74 %     11.53 %     2.49 %
    Return on average tangible equity(1)   13.75 %     14.80 %     4.18 %
    Efficiency ratio(1)   59.38 %     59.06 %     71.28 %
    Net interest margin, tax equivalent(1)   3.44 %     3.43 %     2.33 %
    Loans to deposits ratio   78.41 %     78.78 %     79.04 %
    CET1 Ratio   10.97 %     10.73 %     8.98 %
    Common equity ratio   9.27 %     8.97 %     7.83 %
    Tangible common equity ratio(1)   7.89 %     7.57 %     6.43 %
    Credit Risk Profile:          
    Total nonperforming loans $ 17,470     $ 21,847     $ 29,267  
    Nonperforming loans ratio   0.41 %     0.51 %     0.66 %
    Total nonperforming assets $ 20,889     $ 25,184     $ 33,164  
    Nonperforming assets ratio   0.33 %     0.40 %     0.49 %
    Net charge-offs $ 3,087     $ 691     $ 189  
    Net charge-off ratio   0.29 %     0.06 %     0.02 %
    Allowance for credit losses $ 53,900     $ 55,200     $ 55,900  
    Allowance for credit losses ratio   1.25 %     1.28 %     1.27 %
    Allowance for credit losses to nonaccrual ratio   309.47 %     254.32 %     197.53 %
               
    (1) Non-GAAP measure. See the Non-GAAP Measures section for a reconciliation to the most directly comparable GAAP measure.
     

    MIDWESTONE FINANCIAL GROUP, INC.
    AVERAGE BALANCE SHEET AND YIELD ANALYSIS

      Three Months Ended
      March 31, 2025   December 31, 2024   March 31, 2024
    (Dollars in thousands) Average
    Balance
      Interest
    Income/
    Expense
      Average
    Yield/
    Cost
      Average
    Balance
      Interest
    Income/
    Expense
      Average
    Yield/
    Cost
      Average Balance   Interest
    Income/
    Expense
      Average
    Yield/
    Cost
    ASSETS                                  
    Loans, including fees (1)(2)(3) $4,290,710   $60,443   5.71%   $4,307,583   $63,443   5.86%   $4,298,216   $58,867   5.51%
    Taxable investment securities 1,207,844   13,327   4.47%   1,080,716   11,320   4.17%   1,557,603   9,460   2.44%
    Tax-exempt investment securities (2)(4) 105,563   865   3.32%   109,183   896   3.26%   328,736   2,097   2.57%
    Total securities held for investment(2) 1,313,407   14,192   4.38%   1,189,899   12,216   4.08%   1,886,339   11,557   2.46%
    Other 124,133   1,247   4.07%   309,904   3,761   4.83%   30,605   418   5.49%
    Total interest earning assets(2) $5,728,250   $75,882   5.37%   $5,807,386   $79,420   5.44%   $6,215,160   $70,842   4.58%
    Other assets 440,296           472,589           420,219        
    Total assets $6,168,546           $6,279,975           $6,635,379        
    LIABILITIES AND SHAREHOLDERS’ EQUITY                                  
    Interest checking deposits $1,240,586   $2,127   0.70%   $1,252,481   $2,205   0.70%   $1,301,470   $2,890   0.89%
    Money market deposits 1,002,743   6,333   2.56%   1,046,571   7,197   2.74%   1,102,543   8,065   2.94%
    Savings deposits 835,731   3,057   1.48%   799,931   3,158   1.57%   694,143   2,047   1.19%
    Time deposits 1,397,595   13,967   4.05%   1,410,542   14,764   4.16%   1,446,981   14,724   4.09%
    Total interest bearing deposits 4,476,655   25,484   2.31%   4,509,525   27,324   2.41%   4,545,137   27,726   2.45%
    Securities sold under agreements to repurchase 2,705   5   0.75%   3,640   8   0.87%   5,330   11   0.83%
    Other short-term borrowings   20   —%   6,465   107   6.58%   409,525   4,964   4.88%
    Total short-term borrowings 2,705   25   3.75%   10,105   115   4.53%   414,855   4,975   4.82%
    Long-term debt 113,364   1,791   6.41%   116,018   1,890   6.48%   123,266   2,103   6.86%
    Total borrowed funds 116,069   1,816   6.35%   126,123   2,005   6.32%   538,121   7,078   5.29%
    Total interest bearing liabilities $4,592,724   $27,300   2.41%   $4,635,648   $29,329   2.52%   $5,083,258   $34,804   2.75%
    Noninterest bearing deposits 922,164           955,375           935,977        
    Other liabilities 82,280           125,536           88,611        
    Shareholders’ equity 571,378           563,416           527,533        
    Total liabilities and shareholders’ equity $6,168,546           $6,279,975           $6,635,379        
    Net interest income(2)     $48,582           $50,091           $36,038    
    Net interest spread(2)         2.96%           2.92%           1.83%
    Net interest margin(2)         3.44%           3.43%           2.33%
                                       
    Total deposits(5) $5,398,819   $25,484   1.91%   $5,464,900   $27,324   1.99%   $5,481,114   $27,726   2.03%
    Cost of funds(6)         2.01%           2.09%           2.33%
    (1) Average balance includes nonaccrual loans.
    (2) Tax equivalent. The federal statutory tax rate utilized was 21%.
    (3) Interest income includes net loan fees, loan purchase discount accretion and tax equivalent adjustments. Net loan fees were $256 thousand, $456 thousand, and $237 thousand for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. Loan purchase discount accretion was $1.2 million, $2.5 million, and $1.2 million for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. Tax equivalent adjustments were $981 thousand, $985 thousand, and $920 thousand for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. The federal statutory tax rate utilized was 21%.
    (4) Interest income includes tax equivalent adjustments of $162 thousand, $168 thousand, and $387 thousand for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. The federal statutory tax rate utilized was 21%.
    (5) Total deposits is the sum of total interest-bearing deposits and noninterest bearing deposits. The cost of total deposits is calculated as annualized interest expense on deposits divided by average total deposits.
    (6) Cost of funds is calculated as annualized total interest expense divided by the sum of average total deposits and borrowed funds.
       

    Non-GAAP Measures

    This earnings release contains non-GAAP measures for tangible common equity, tangible book value per share, tangible common equity ratio, return on average tangible equity, net interest margin (tax equivalent), core net interest margin, loan yield (tax equivalent), core yield on loans, efficiency ratio, adjusted earnings and adjusted earnings per share. Management believes these measures provide investors with useful information regarding the Company’s profitability, financial condition and capital adequacy, consistent with how management evaluates the Company’s financial performance. The following tables provide a reconciliation of each non-GAAP measure to the most comparable GAAP measure.

    Tangible Common Equity/Tangible Book Value                    
    per Share/Tangible Common Equity Ratio   March 31,   December 31,   September 30,   June 30,   March 31,
    (Dollars in thousands, except per share data)     2025       2024       2024       2024       2024  
    Total shareholders’ equity   $ 579,625     $ 559,696     $ 562,238     $ 543,286     $ 528,040  
    Intangible assets, net     (93,399 )     (94,807 )     (96,257 )     (97,327 )     (100,649 )
    Tangible common equity   $ 486,226     $ 464,889     $ 465,981     $ 445,959     $ 427,391  
                         
    Total assets   $ 6,254,394     $ 6,236,329     $ 6,552,482     $ 6,581,658     $ 6,748,015  
    Intangible assets, net     (93,399 )     (94,807 )     (96,257 )     (97,327 )     (100,649 )
    Tangible assets   $ 6,160,995     $ 6,141,522     $ 6,456,225     $ 6,484,331     $ 6,647,366  
                         
    Book value per share   $ 27.85     $ 26.94     $ 27.06     $ 34.44     $ 33.53  
    Tangible book value per share(1)   $ 23.36     $ 22.37     $ 22.43     $ 28.27     $ 27.14  
    Shares outstanding     20,815,715       20,777,485       20,774,919       15,773,468       15,750,471  
                         
    Common equity ratio     9.27 %     8.97 %     8.58 %     8.25 %     7.83 %
    Tangible common equity ratio(2)     7.89 %     7.57 %     7.22 %     6.88 %     6.43 %
                                             

    (1) Tangible common equity divided by shares outstanding. 
    (2) Tangible common equity divided by tangible assets.  

        Three Months Ended
    Return on Average Tangible Equity   March 31,   December 31,   March 31,
    (Dollars in thousands)     2025       2024       2024  
    Net income   $ 15,138     $ 16,330     $ 3,269  
    Intangible amortization, net of tax(1)     1,047       1,075       1,228  
    Tangible net income   $ 16,185     $ 17,405     $ 4,497  
                 
    Average shareholders’ equity   $ 571,378     $ 563,416     $ 527,533  
    Average intangible assets, net     (94,169 )     (95,498 )     (95,296 )
    Average tangible equity   $ 477,209     $ 467,918     $ 432,237  
                 
    Return on average equity     10.74 %     11.53 %     2.49 %
    Return on average tangible equity(2)     13.75 %     14.80 %     4.18 %
                             

    (1) The income tax rate utilized was the blended marginal tax rate.  
    (2) Annualized tangible net income divided by average tangible equity.

    Net Interest Margin, Tax Equivalent/
    Core Net Interest Margin
      Three Months Ended
      March 31,   December 31,   March 31,
    (Dollars in thousands)     2025       2024       2024  
    Net interest income   $ 47,439     $ 48,938     $ 34,731  
    Tax equivalent adjustments:            
    Loans(1)     981       985       920  
    Securities(1)     162       168       387  
    Net interest income, tax equivalent   $ 48,582     $ 50,091     $ 36,038  
    Loan purchase discount accretion     (1,166 )     (2,496 )     (1,152 )
    Core net interest income   $ 47,416     $ 47,595     $ 34,886  
                 
    Net interest margin     3.36 %     3.35 %     2.25 %
    Net interest margin, tax equivalent(2)     3.44 %     3.43 %     2.33 %
    Core net interest margin(3)     3.36 %     3.26 %     2.26 %
    Average interest earning assets   $ 5,728,250     $ 5,807,386     $ 6,215,160  
                             

    (1) The federal statutory tax rate utilized was 21%.  
    (2) Annualized tax equivalent net interest income divided by average interest earning assets.  
    (3) Annualized core net interest income divided by average interest earning assets.   

          Three Months Ended
    Loan Yield, Tax Equivalent / Core Yield on Loans   March 31,   December 31,   March 31,
    (Dollars in thousands)     2025       2024       2024  
    Loan interest income, including fees     $ 59,462     $ 62,458     $ 57,947  
    Tax equivalent adjustment(1)       981       985       920  
    Tax equivalent loan interest income     $ 60,443     $ 63,443     $ 58,867  
    Loan purchase discount accretion       (1,166 )     (2,496 )     (1,152 )
    Core loan interest income     $ 59,277     $ 60,947     $ 57,715  
                   
    Yield on loans       5.62 %     5.77 %     5.42 %
    Yield on loans, tax equivalent(2)       5.71 %     5.86 %     5.51 %
    Core yield on loans(3)       5.60 %     5.63 %     5.40 %
    Average loans     $ 4,290,710     $ 4,307,583     $ 4,298,216  
                               

    (1) The federal statutory tax rate utilized was 21%.  
    (2) Annualized tax equivalent loan interest income divided by average loans.  
    (3) Annualized core loan interest income divided by average loans.  

          Three Months Ended
    Efficiency Ratio   March 31,   December 31,   March 31,
    (Dollars in thousands)     2025       2024       2024  
    Total noninterest expense     $ 36,293     $ 37,372     $ 35,565  
    Amortization of intangibles       (1,408 )     (1,449 )     (1,637 )
    Merger-related expenses       (40 )     (31 )     (1,314 )
    Noninterest expense used for efficiency ratio     $ 34,845     $ 35,892     $ 32,614  
                   
    Net interest income, tax equivalent(1)     $ 48,582     $ 50,091     $ 36,038  
    Plus: Noninterest income       10,136       10,837       9,750  
    Less: Investment securities gains, net       33       161       36  
    Net revenues used for efficiency ratio     $ 58,685     $ 60,767     $ 45,752  
                   
    Efficiency ratio (2)       59.38 %     59.06 %     71.28 %
                               

    (1) The federal statutory tax rate utilized was 21%.    
    (2) Noninterest expense adjusted for amortization of intangibles and merger-related expenses divided by the sum of tax equivalent net interest income, noninterest income and net investment securities gains.  

          Three Months Ended
    Adjusted Earnings   March 31,   December 31,   March 31,
    (Dollars in thousands, except per share data)     2025       2024     2024  
    Net income     $         15,138     $         16,330   $           3,269  
    Less: Investment securities gains, net of tax(1)                        25                      119                      27  
    Less: Mortgage servicing rights (loss) gain, net of tax(1)                     (158 )                    122                   (276 )
    Plus: Merger-related expenses, net of tax(1)                        30                        23                    986  
    Adjusted earnings     $         15,301     $         16,112   $           4,504  
                   
    Weighted average diluted common shares outstanding                 20,849                 20,851               15,774  
                   
    Earnings per common share – diluted     $             0.73     $             0.78   $             0.21  
    Adjusted earnings per common share(2)     $             0.73     $             0.77   $             0.29  
                             

    (1) The income tax rate utilized was the blended marginal tax rate.      
    (2) Adjusted earnings divided by weighted average diluted common shares outstanding.  

    Category: Earnings

    This news release may be downloaded from Corporate Profile | MidWestOne Financial Group, Inc.

    Source: MidWestOne Financial Group, Inc.

    Industry: Banks

    Contact:

      Charles N. Reeves Barry S. Ray
      Chief Executive Officer Chief Financial Officer
      319.356.5800   319.356.5800
         

    The MIL Network

  • MIL-OSI: South Plains Financial, Inc. Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    LUBBOCK, Texas, April 24, 2025 (GLOBE NEWSWIRE) — South Plains Financial, Inc. (NASDAQ:SPFI) (“South Plains” or the “Company”), the parent company of City Bank (“City Bank” or the “Bank”), today reported its financial results for the quarter ended March 31, 2025.

    First Quarter 2025 Highlights

    • Net income for the first quarter of 2025 was $12.3 million, compared to $16.5 million for the fourth quarter of 2024 and $10.9 million for the first quarter of 2024.
    • Diluted earnings per share for the first quarter of 2025 was $0.72, compared to $0.96 for the fourth quarter of 2024 and $0.64 for the first quarter of 2024.
    • Average cost of deposits for the first quarter of 2025 was 219 basis points, compared to 229 basis points for the fourth quarter of 2024 and 241 basis points for the first quarter of 2024.
    • Net interest margin, on a tax-equivalent basis, was 3.81% for the first quarter of 2025, compared to 3.75% for the fourth quarter of 2024 and 3.56% for the first quarter of 2024.
    • Nonperforming assets to total assets were 0.16% at March 31, 2025, compared to 0.58% at December 31, 2024 and 0.10% at March 31, 2024.
    • Return on average assets for the first quarter of 2025 was 1.16%, compared to 1.53% for the fourth quarter of 2024 and 1.04% for the first quarter of 2024.
    • Tangible book value (non-GAAP) per share was $26.05 as of March 31, 2025, compared to $25.40 as of December 31, 2024 and $23.56 as of March 31, 2024.
    • The consolidated total risk-based capital ratio, common equity tier 1 risk-based capital ratio, and tier 1 leverage ratio at March 31, 2025 were 17.93%, 13.59%, and 12.04%, respectively.

    Curtis Griffith, South Plains’ Chairman and Chief Executive Officer, commented, “We delivered strong first quarter results highlighted by solid deposit growth, healthy margin expansion as our cost of funds continued to improve, and loan growth that was in line with our expectations. Additionally, the credit quality of our loan portfolio continued to strengthen in the quarter which is a testament to our conservative culture and proactive approach to managing credit. While the outlook is uncertain, we believe that we are in an advantageous position relative to our peers and are actively looking to expand in both our metropolitan and rural markets. We have the liquidity, capital, and team to take advantage of opportunities that come our way. While the economy may slow and businesses may reduce their risk appetites, we will be ready to meet the needs of our customers in these uncertain times. We will also continue to add experienced lenders who fit our culture and want to bring their customers to a better, more stable bank. However, we will maintain our conservative credit culture and will never sacrifice credit quality for growth as we work to maintain the strong credit quality of our loan portfolio. While we see many opportunities to continue growing the Bank, we believe our share price does not reflect the value that we are creating. As a result, we spent $8.3 million to repurchase 250,000 shares in the first quarter, leaving approximately $7 million under our previously announced share repurchase program.”

    Results of Operations, Quarter Ended March 31, 2025

    Net Interest Income

    Net interest income was $38.5 million for the first quarter of 2025, compared to $38.5 million for the fourth quarter of 2024 and $35.4 million for the first quarter of 2024. Net interest margin, calculated on a tax-equivalent basis, was 3.81% for the first quarter of 2025, compared to 3.75% for the fourth quarter of 2024 and 3.56% for the first quarter of 2024. The average yield on loans was 6.67% for the first quarter of 2025, compared to 6.69% for the fourth quarter of 2024 and 6.53% for the first quarter of 2024. The average cost of deposits was 219 basis points for the first quarter of 2025, which is 10 basis points lower than the fourth quarter of 2024 and 22 basis points lower than the first quarter of 2024.

    Interest income was $59.9 million for the first quarter of 2025, compared to $61.3 million for the fourth quarter of 2024 and $58.7 million for the first quarter of 2024. Interest income decreased $1.4 million in the first quarter of 2025 from the fourth quarter of 2024, which was primarily comprised of a decrease of $692 thousand in loan interest income and a decrease of $408 thousand in interest income on other earning assets. The decline in interest income was due primarily to fewer days in the first quarter as compared to the fourth quarter of 2024. Interest income increased $1.2 million in the first quarter of 2025 compared to the first quarter of 2024. This increase was primarily due to an increase of average loans of $60.0 million and higher loan interest rates during the period, resulting in growth of $1.6 million in loan interest income.

    Interest expense was $21.4 million for the first quarter of 2025, compared to $22.8 million for the fourth quarter of 2024 and $23.4 million for the first quarter of 2024. Interest expense decreased $1.4 million compared to the fourth quarter of 2024 and decreased $2.0 million compared to the first quarter of 2024. The $1.4 million decrease was primarily as a result of a 19 basis point decline in the cost of interest-bearing deposits and fewer days in the quarter, partially offset by an increase of $50.0 million in average interest-bearing deposits in the first quarter of 2025 as compared to the fourth quarter of 2024. The $2.0 million decrease was primarily as a result of a 34 basis point decline in the cost of interest-bearing deposits, partially offset by an increase of $83.4 million in average interest-bearing deposits in the first quarter of 2025 as compared to the first quarter of 2024.

    Noninterest Income and Noninterest Expense

    Noninterest income was $10.6 million for the first quarter of 2025, compared to $13.3 million for the fourth quarter of 2024 and $11.4 million for the first quarter of 2024. The decrease from the fourth quarter of 2024 was primarily due to a decrease of $2.8 million in mortgage banking revenues, mainly as a result of a decrease of $3.0 million in the fair value adjustment of the mortgage servicing rights assets as interest rates that affect the value decreased in the first quarter of 2025. The decrease in noninterest income for the first quarter of 2025 as compared to the first quarter of 2024 was primarily due to a decrease of $1.8 million in mortgage banking activities revenue mainly from a decrease of $1.6 million in the fair value adjustment of the mortgage servicing rights assets as interest rates that affect the value decreased in the first quarter of 2025. This decrease in mortgage banking activities revenue was partially offset by growth in service charges on deposits revenue and bank card services and interchange revenue.

    Noninterest expense was $33.0 million for the first quarter of 2025, compared to $29.9 million for the fourth quarter of 2024 and $31.9 million for the first quarter of 2024. The $3.1 million increase from the fourth quarter of 2024 was largely the result of an increase of $2.1 million in personnel expenses, primarily from annual salary adjustments, increased health insurance costs as the fourth quarter of 2024 included annual rebates received, and increased annual incentive compensation expense. There were also increases in net occupancy expense, professional service expenses, and the ineffectiveness related to fair value hedges on municipal securities. The increase in noninterest expense for the first quarter of 2025 as compared to the first quarter of 2024 was largely the result of an increase of $453 thousand in personnel expenses, largely a result of annual salary adjustments.

    Loan Portfolio and Composition

    Loans held for investment were $3.08 billion as of March 31, 2025, compared to $3.06 billion as of December 31, 2024 and $3.01 billion as of March 31, 2024. The increase of $20.8 million, or 2.7% annualized, during the first quarter of 2025 as compared to the fourth quarter of 2024 occurred primarily as a result of organic loan growth experienced in commercial owner-occupied real estate loans and commercial goods and services loans, partially offset by a seasonal decrease in agricultural production loans. As of March 31, 2025, loans held for investment increased $64.1 million, or 2.1%, from March 31, 2024, primarily attributable to organic loan growth, occurring broadly across the real estate and commercial loan segments, partially offset by decreases in auto loans and other consumer loans.

    Deposits and Borrowings

    Deposits totaled $3.79 billion as of March 31, 2025, compared to $3.62 billion as of December 31, 2024 and $3.64 billion as of March 31, 2024. Deposits increased by $171.6 million, or 4.7%, in the first quarter of 2025 from December 31, 2024. Deposits increased by $153.9 million, or 4.2%, at March 31, 2025 as compared to March 31, 2024. Noninterest-bearing deposits were $966.5 million as of March 31, 2025, compared to $935.5 million as of December 31, 2024 and $974.2 million as of March 31, 2024. Noninterest-bearing deposits represented 25.5% of total deposits as of March 31, 2025. The quarterly change in total deposits was mainly due to a seasonal increase of $70.2 million in public fund deposits and strong organic growth in retail and commercial deposits. The year-over-year increase in total deposits was primarily the result of continued organic growth in retail and commercial deposits.

    Asset Quality

    The Company recorded a provision for credit losses in the first quarter of 2025 of $420 thousand, compared to $1.2 million in the fourth quarter of 2024 and $830 thousand in the first quarter of 2024. The provision during the first quarter of 2025 was largely attributable to net charge-off activity and increased loan balances, partially offset by improved credit quality as noted below in the nonperforming assets to total assets ratio.

    The ratio of allowance for credit losses to loans held for investment was 1.40% as of March 31, 2025, compared to 1.42% as of December 31, 2024 and 1.40% as of March 31, 2024.

    The ratio of nonperforming assets to total assets was 0.16% as of March 31, 2025, compared to 0.58% as of December 31, 2024 and 0.10% as of March 31, 2024. A $19.0 million credit was placed back on accrual status at the end of the first quarter of 2025, based on sustained payment performance and improved credit structure. This credit was repaid in full subsequent to March 31, 2025. Annualized net charge-offs were 0.07% for the first quarter of 2025, compared to 0.11% for the fourth quarter of 2024 and 0.13% for the first quarter of 2024.

    Capital

    Book value per share increased to $27.33 at March 31, 2025, compared to $26.67 at December 31, 2024. The change was primarily driven by $9.8 million of net income after dividends paid and by an increase in accumulated other comprehensive income of $2.7 million, partially offset by stock repurchases of $8.3 million. The tangible common equity to tangible assets ratio (non-GAAP) decreased 28 basis points to 9.64% in the first quarter of 2025, largely due to growth of $173.0 million in tangible assets.

    Conference Call

    South Plains will host a conference call to discuss its first quarter 2025 financial results today, April 24, 2025, at 5:00 p.m., Eastern Time. Investors and analysts interested in participating in the call are invited to dial 1-877-407-9716 (international callers please dial 1-201-493-6779) approximately 10 minutes prior to the start of the call. A live audio webcast of the conference call and conference materials will be available on the Company’s website at https://www.spfi.bank/news-events/events.

    A replay of the conference call will be available within two hours of the conclusion of the call and can be accessed on the investor section of the Company’s website as well as by dialing 1-844-512-2921 (international callers please dial 1-412-317-6671). The pin to access the telephone replay is 13752910. The replay will be available until May 8, 2025.

    About South Plains Financial, Inc.

    South Plains is the bank holding company for City Bank, a Texas state-chartered bank headquartered in Lubbock, Texas. City Bank is one of the largest independent banks in West Texas and has additional banking operations in the Dallas, El Paso, Greater Houston, the Permian Basin, and College Station, Texas markets, and the Ruidoso, New Mexico market. South Plains provides a wide range of commercial and consumer financial services to small and medium-sized businesses and individuals in its market areas. Its principal business activities include commercial and retail banking, along with investment, trust and mortgage services. Please visit https://www.spfi.bank for more information.

    Non-GAAP Financial Measures

    Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with generally accepted accounting principles in the United States (“GAAP”). These non-GAAP financial measures include Tangible Book Value Per Share, Tangible Common Equity to Tangible Assets, and Pre-Tax, Pre-Provision Income. The Company believes these non-GAAP financial measures provide both management and investors a more complete understanding of the Company’s financial position and performance. These non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP financial measures.

    We classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows. Not all companies use the same calculation of these measures; therefore, this presentation may not be comparable to other similarly titled measures as presented by other companies.

    A reconciliation of non-GAAP financial measures to GAAP financial measures is provided at the end of this press release.

    Available Information

    The Company routinely posts important information for investors on its web site (under www.spfi.bank and, more specifically, under the News & Events tab at www.spfi.bank/news-events/press-releases). The Company intends to use its web site as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD (Fair Disclosure) promulgated by the U.S. Securities and Exchange Commission (the “SEC”). Accordingly, investors should monitor the Company’s web site, in addition to following the Company’s press releases, SEC filings, public conference calls, presentations and webcasts.

    The information contained on, or that may be accessed through, the Company’s web site is not incorporated by reference into, and is not a part of, this document.

    Forward Looking Statements

    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect South Plains’ current views with respect to future events and South Plains’ financial performance. Any statements about South Plains’ expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. South Plains cautions that the forward-looking statements in this press release are based largely on South Plains’ expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond South Plains’ control. Factors that could cause such changes include, but are not limited to, the impact on us and our customers of a decline in general economic conditions and any regulatory responses thereto; potential recession in the United States and our market areas; the impacts related to or resulting from uncertainty in the banking industry as a whole; increased competition for deposits in our market areas and related changes in deposit customer behavior; the impact of changes in market interest rates, whether due to a continuation of the elevated interest rate environment or further reductions in interest rates and a resulting decline in net interest income; the lingering inflationary pressures, and the risk of the resurgence of elevated levels of inflation, in the United States and our market areas; the uncertain impacts of ongoing quantitative tightening and current and future monetary policies of the Board of Governors of the Federal Reserve System; increases in unemployment rates in the United States and our market areas; adverse changes in customer spending and savings habits; declines in commercial real estate values and prices; a deterioration of the credit rating for U.S. long-term sovereign debt or uncertainty regarding United States fiscal debt, deficit and budget matters; cyber incidents or other failures, disruptions or breaches of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber-attacks; severe weather, natural disasters, acts of war or terrorism, geopolitical instability or other external events, including as a result of changes in U.S. presidential administrations or Congress; the impacts of tariffs, sanctions and other trade policies of the United States and its global trading counterparts and the resulting impact on the Company and its customers; competition and market expansion opportunities; changes in non-interest expenditures or in the anticipated benefits of such expenditures; the risks related to the development, implementation, use and management of emerging technologies, including artificial intelligence and machine learnings; potential costs related to the impacts of climate change; current or future litigation, regulatory examinations or other legal and/or regulatory actions; and changes in applicable laws and regulations. Additional information regarding these risks and uncertainties to which South Plains’ business and future financial performance are subject is contained in South Plains’ most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q on file with the SEC, including the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of such documents, and other documents South Plains files or furnishes with the SEC from time to time, which are available on the SEC’s website, www.sec.gov. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements due to additional risks and uncertainties of which South Plains is not currently aware or which it does not currently view as, but in the future may become, material to its business or operating results. Due to these and other possible uncertainties and risks, the Company can give no assurance that the results contemplated in the forward-looking statements will be realized and readers are cautioned not to place undue reliance on the forward-looking statements contained in this press release. Any forward-looking statements presented herein are made only as of the date of this press release, and South Plains does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, new information, the occurrence of unanticipated events, or otherwise, except as required by applicable law. All forward-looking statements, express or implied, included in the press release are qualified in their entirety by this cautionary statement.

    Contact: Mikella Newsom, Chief Risk Officer and Secretary
      (866) 771-3347
      investors@city.bank

    Source: South Plains Financial, Inc.

    South Plains Financial, Inc.
    Consolidated Financial Highlights – (Unaudited)
    (Dollars in thousands, except share data)

      As of and for the quarter ended
      March 31,
    2025
      December 31,
    2024
      September 30,
    2024
      June 30,
    2024
      March 31,
    2024
    Selected Income Statement Data:                            
    Interest income $ 59,922     $ 61,324     $ 61,640     $ 59,208     $ 58,727  
    Interest expense   21,395       22,776       24,346       23,320       23,359  
    Net interest income   38,527       38,548       37,294       35,888       35,368  
    Provision for credit losses   420       1,200       495       1,775       830  
    Noninterest income   10,625       13,319       10,635       12,709       11,409  
    Noninterest expense   33,030       29,948       33,128       32,572       31,930  
    Income tax expense   3,408       4,222       3,094       3,116       3,143  
    Net income   12,294       16,497       11,212       11,134       10,874  
    Per Share Data (Common Stock):                            
    Net earnings, basic $ 0.75     $ 1.01     $ 0.68     $ 0.68     $ 0.66  
    Net earnings, diluted   0.72       0.96       0.66       0.66       0.64  
    Cash dividends declared and paid   0.15       0.15       0.14       0.14       0.13  
    Book value   27.33       26.67       27.04       25.45       24.87  
    Tangible book value (non-GAAP)   26.05       25.40       25.75       24.15       23.56  
    Weighted average shares outstanding, basic   16,415,862       16,400,361       16,386,079       16,425,360       16,429,919  
    Weighted average shares outstanding, dilutive   17,065,599       17,161,646       17,056,959       16,932,077       16,938,857  
    Shares outstanding at end of period   16,235,647       16,455,826       16,386,627       16,424,021       16,431,755  
    Selected Period End Balance Sheet Data:                            
    Cash and cash equivalents $ 536,300     $ 359,082     $ 471,167     $ 298,006     $ 371,939  
    Investment securities   571,527       577,240       606,889       591,031       599,869  
    Total loans held for investment   3,075,860       3,055,054       3,037,375       3,094,273       3,011,799  
    Allowance for credit losses   42,968       43,237       42,886       43,173       42,174  
    Total assets   4,405,209       4,232,239       4,337,659       4,220,936       4,218,993  
    Interest-bearing deposits   2,826,055       2,685,366       2,720,880       2,672,948       2,664,397  
    Noninterest-bearing deposits   966,464       935,510       998,480       951,565       974,174  
    Total deposits   3,792,519       3,620,876       3,719,360       3,624,513       3,638,571  
    Borrowings   110,400       110,354       110,307       110,261       110,214  
    Total stockholders’ equity   443,743       438,949       443,122       417,985       408,712  
    Summary Performance Ratios:                            
    Return on average assets (annualized)   1.16 %     1.53 %     1.05 %     1.07 %     1.04 %
    Return on average equity (annualized)   11.30 %     14.88 %     10.36 %     10.83 %     10.72 %
    Net interest margin(1)   3.81 %     3.75 %     3.65 %     3.63 %     3.56 %
    Yield on loans   6.67 %     6.69 %     6.68 %     6.60 %     6.53 %
    Cost of interest-bearing deposits   2.93 %     3.12 %     3.36 %     3.33 %     3.27 %
    Efficiency ratio   66.90 %     57.50 %     68.80 %     66.72 %     67.94 %
    Summary Credit Quality Data:                            
    Nonperforming loans $ 6,467     $ 24,023     $ 24,693     $ 23,452     $ 3,380  
    Nonperforming loans to total loans held for investment   0.21 %     0.79 %     0.81 %     0.76 %     0.11 %
    Other real estate owned $ 600     $ 530     $ 973     $ 755     $ 862  
    Nonperforming assets to total assets   0.16 %     0.58 %     0.59 %     0.57 %     0.10 %
    Allowance for credit losses to total loans held for investment   1.40 %     1.42 %     1.41 %     1.40 %     1.40 %
    Net charge-offs to average loans outstanding (annualized)   0.07 %     0.11 %     0.11 %     0.10 %     0.13 %
      As of and for the quarter ended
      March 31
    2025
      December 31,
    2024
      September 30,
    2024
      June 30,
    2024
      March 31,
    2024
    Capital Ratios:                            
    Total stockholders’ equity to total assets   10.07 %     10.37 %     10.22 %     9.90 %     9.69 %
    Tangible common equity to tangible assets (non-GAAP)   9.64 %     9.92 %     9.77 %     9.44 %     9.22 %
    Common equity tier 1 to risk-weighted assets   13.59 %     13.53 %     13.25 %     12.61 %     12.67 %
    Tier 1 capital to average assets   12.04 %     12.04 %     11.76 %     11.81 %     11.51 %
    Total capital to risk-weighted assets   17.93 %     17.86 %     17.61 %     16.86 %     17.00 %

    (1)  Net interest margin is calculated as the annual net interest income, on a fully tax-equivalent basis, divided by average interest-earning assets.

    South Plains Financial, Inc.
    Average Balances and Yields – (Unaudited)
    (Dollars in thousands)

      For the Three Months Ended
      March 31, 2025   March 31, 2024
           
      Average
    Balance
      Interest   Yield/Rate   Average
    Balance
      Interest   Yield/Rate
    Assets                                          
    Loans $ 3,074,568     $ 50,577       6.67 %   $ 3,014,537     $ 48,940       6.53 %
    Debt securities – taxable   510,354       4,692       3.73 %     554,081       5,511       4.00 %
    Debt securities – nontaxable   153,229       1,014       2.68 %     156,254       1,024       2.64 %
    Other interest-bearing assets   386,979       3,859       4.04 %     298,969       3,475       4.67 %
                                               
    Total interest-earning assets   4,125,130       60,142       5.91 %     4,023,841       58,950       5.89 %
    Noninterest-earning assets   171,683                     184,293                
                                               
    Total assets $ 4,296,813                   $ 4,208,134                
                                               
    Liabilities & stockholders’ equity                                          
    NOW, Savings, MMDA’s $ 2,302,344       15,511       2.73 %   $ 2,285,981       17,997       3.17 %
    Time deposits   441,895       4,316       3.96 %     374,852       3,666       3.93 %
    Short-term borrowings   3             0.00 %     3             0.00 %
    Notes payable & other long-term borrowings               0.00 %                 0.00 %
    Subordinated debt   63,984       835       5.29 %     63,798       835       5.26 %
    Junior subordinated deferrable interest debentures   46,393       733       6.41 %     46,393       861       7.46 %
                                               
    Total interest-bearing liabilities   2,854,619       21,395       3.04 %     2,771,027       23,359       3.39 %
    Demand deposits   934,775                     958,334                
    Other liabilities   66,073                     70,860                
    Stockholders’ equity   441,346                     407,913                
                                               
    Total liabilities & stockholders’ equity $ 4,296,813                   $ 4,208,134                
                                               
    Net interest income         $ 38,747                   $ 35,591        
    Net interest margin(2)                   3.81 %                     3.56 %

    (1)  Average loan balances include nonaccrual loans and loans held for sale.
    (2)  Net interest margin is calculated as the annualized net interest income, on a fully tax-equivalent basis, divided by average interest-earning assets.

    South Plains Financial, Inc.
    Consolidated Balance Sheets
    (Unaudited)
    (Dollars in thousands)

      As of
      March 31,
    2025
      December 31,
    2024
               
    Assets          
    Cash and due from banks $ 56,006     $ 54,114  
    Interest-bearing deposits in banks   480,294       304,968  
    Securities available for sale   571,527       577,240  
    Loans held for sale   13,931       20,542  
    Loans held for investment   3,075,860       3,055,054  
    Less:  Allowance for credit losses   (42,968 )     (43,237 )
    Net loans held for investment   3,032,892       3,011,817  
    Premises and equipment, net   50,873       52,951  
    Goodwill   19,315       19,315  
    Intangible assets   1,569       1,720  
    Mortgage servicing rights   24,906       26,292  
    Other assets   153,896       163,280  
    Total assets $ 4,405,209     $ 4,232,239  
               
    Liabilities and Stockholders’ Equity          
    Noninterest-bearing deposits $ 966,464     $ 935,510  
    Interest-bearing deposits   2,826,055       2,685,366  
    Total deposits   3,792,519       3,620,876  
    Subordinated debt   64,007       63,961  
    Junior subordinated deferrable interest debentures   46,393       46,393  
    Other liabilities   58,547       62,060  
    Total liabilities   3,961,466       3,793,290  
    Stockholders’ Equity          
    Common stock   16,236       16,456  
    Additional paid-in capital   89,799       97,287  
    Retained earnings   395,652       385,827  
    Accumulated other comprehensive income (loss)   (57,944 )     (60,621 )
    Total stockholders’ equity   443,743       438,949  
    Total liabilities and stockholders’ equity $ 4,405,209     $ 4,232,239  

    South Plains Financial, Inc.
    Consolidated Statements of Income
    (Unaudited)
    (Dollars in thousands)

      Three Months Ended
      March 31,
    2025
      March 31,
    2024
                   
    Interest income:              
    Loans, including fees $ 50,570     $ 48,932  
    Other   9,352       9,795  
    Total interest income   59,922       58,727  
    Interest expense:              
    Deposits   19,827       21,663  
    Subordinated debt   835       835  
    Junior subordinated deferrable interest debentures   733       861  
    Other          
    Total interest expense   21,395       23,359  
    Net interest income   38,527       35,368  
    Provision for credit losses   420       830  
    Net interest income after provision for credit losses   38,107       34,538  
    Noninterest income:              
    Service charges on deposits   2,141       1,813  
    Income from insurance activities   28       34  
    Mortgage banking activities   2,113       3,945  
    Bank card services and interchange fees   3,379       3,061  
    Other   2,964       2,556  
    Total noninterest income   10,625       11,409  
    Noninterest expense:              
    Salaries and employee benefits   19,441       18,988  
    Net occupancy expense   4,027       3,920  
    Professional services   1,730       1,483  
    Marketing and development   905       754  
    Other   6,927       6,785  
    Total noninterest expense   33,030       31,930  
    Income before income taxes   15,702       14,017  
    Income tax expense   3,408       3,143  
    Net income $ 12,294     $ 10,874  

    South Plains Financial, Inc.
    Loan Composition
    (Unaudited)
    (Dollars in thousands)

      As of
      March 31,
    2025
      December 31,
    2024
                   
    Loans:              
    Commercial Real Estate $ 1,126,800     $ 1,119,063  
    Commercial – Specialized   366,796       388,955  
    Commercial – General   584,705       557,371  
    Consumer:              
    1-4 Family Residential   569,799       566,400  
    Auto Loans   261,629       254,474  
    Other Consumer   64,090       64,936  
    Construction   102,041       103,855  
    Total loans held for investment $ 3,075,860     $ 3,055,054  

    South Plains Financial, Inc.
    Deposit Composition
    (Unaudited)
    (Dollars in thousands)

      As of
      March 31,
    2025
      December 31,
    2024
                   
    Deposits:              
    Noninterest-bearing deposits $ 966,464     $ 935,510  
    NOW & other transaction accounts   1,302,642       498,718  
    MMDA & other savings   1,082,596       1,741,988  
    Time deposits   440,817       444,660  
    Total deposits $ 3,792,519     $ 3,620,876  

    South Plains Financial, Inc.
    Reconciliation of Non-GAAP Financial Measures (Unaudited)
    (Dollars in thousands)

      For the quarter ended
      March 31,
    2025
      December 31,
    2024
      September 30,
    2024
      June 30,
    2024
      March 31,
    2024
    Pre-tax, pre-provision income                                      
    Net income $ 12,294     $ 16,497     $ 11,212     $ 11,134     $ 10,874  
    Income tax expense   3,408       4,222       3,094       3,116       3,143  
    Provision for credit losses   420       1,200       495       1,775       830  
    Pre-tax, pre-provision income $ 16,122     $ 21,919     $ 14,801     $ 16,025     $ 14,847  
      As of
      March 31,
    2025
      December 31,
    2024
      September 30,
    2024
      June 30,
    2024
      March 31,
    2024
    Tangible common equity                            
    Total common stockholders’ equity $ 443,743     $ 438,949     $ 443,122     $ 417,985     $ 408,712  
    Less:  goodwill and other intangibles   (20,884 )     (21,035 )     (21,197 )     (21,379 )     (21,562 )
                                 
    Tangible common equity $ 422,859     $ 417,914     $ 421,925     $ 396,606     $ 387,150  
                                 
    Tangible assets                            
    Total assets $ 4,405,209     $ 4,232,239     $ 4,337,659     $ 4,220,936     $ 4,218,993  
    Less:  goodwill and other intangibles   (20,884 )     (21,035 )     (21,197 )     (21,379 )     (21,562 )
                                 
    Tangible assets $ 4,384,325     $ 4,211,204     $ 4,316,462     $ 4,199,557     $ 4,197,431  
                                 
    Shares outstanding   16,235,647       16,455,826       16,386,627       16,424,021       16,431,755  
                                 
    Total stockholders’ equity to total assets   10.07 %     10.37 %     10.22 %     9.90 %     9.69 %
    Tangible common equity to tangible assets   9.64 %     9.92 %     9.77 %     9.44 %     9.22 %
    Book value per share $ 27.33     $ 26.67     $ 27.04     $ 25.45     $ 24.87  
    Tangible book value per share $ 26.05     $ 25.40     $ 25.75     $ 24.15     $ 23.56  

    The MIL Network

  • MIL-OSI: USCB Financial Holdings, Inc. Reports Record Fully Diluted EPS of $0.38 for Q1 2025, a 65% increase over same period last year; ROAA of 1.19% and ROAE of 14.15%

    Source: GlobeNewswire (MIL-OSI)

    MIAMI, April 24, 2025 (GLOBE NEWSWIRE) — USCB Financial Holdings, Inc. (the “Company”) (NASDAQ: USCB), the holding company for U.S. Century Bank (the “Bank”), reported net income of $7.7 million or $0.38 per fully diluted share for the three months ended March 31, 2025, compared with net income of $4.6 million or $0.23 per fully diluted share for the same period in 2024.

    “We are proud to report a record quarter, highlighted by fully diluted EPS of $0.38. This performance reflects solid execution across all of our strategic priorities including annualized double-digit loan and deposit growth, maintaining disciplined pricing, clean asset quality, and strong cost controls. Our return on average assets was 1.19%, the highest since the fourth quarter of 2021,” said Luis de la Aguilera. Chairman, President and CEO. “Our continued focus on asset quality, profitability, and growing the Bank in a safe and sound manner has positioned the Company well to navigate the current challenging market and economic environment with confidence and resilience.”

    Unless otherwise stated, all percentage comparisons in the bullet points below are calculated at or for the quarter ended March 31, 2025 compared to at or for the quarter ended March 31, 2024 and annualized where appropriate.

    Profitability

    • Annualized return on average assets for the quarter ended March 31, 2025 was 1.19% compared to 0.76% for the first quarter of 2024.
    • Annualized return on average stockholders’ equity for the quarter ended March 31, 2025 was 14.15% compared to 9.61% for the first quarter of 2024.
    • The efficiency ratio for the quarter ended March 31, 2025 was 52.79% compared to 63.41% for the first quarter of 2024.
    • Net interest margin for the quarter ended March 31, 2025 was 3.10% compared to 2.62% for the first quarter of 2024.
    • Net interest income before provision for credit losses was $19.1 million for the quarter ended March 31, 2025, an increase of $4.0 million or 26.1% compared to $15.2 million for the same period in 2024.

    Balance Sheet

    • Total assets were $2.7 billion at March 31, 2025, representing an increase of $188.2 million or 7.6% from $2.5 billion at March 31, 2024.
    • Total loans held for investment were $2.0 billion at March 31, 2025, representing an increase of $215.0 million or 11.8% from $1.8 billion at March 31, 2024.
    • Total deposits were $2.3 billion at March 31, 2025, representing an increase of $206.8 million or 9.8% from $2.1 billion at March 31, 2024.
    • Total stockholders’ equity was $225.1 million at March 31, 2025, representing an increase of $30.1 million or 15.4% from $195.0 million at March 31, 2024. Total stockholders’ equity included accumulated comprehensive loss of $41.1 million at March 31, 2025 compared to accumulated comprehensive loss of $45.4 million at March 31, 2024.

    Asset Quality

    • The allowance for credit losses (“ACL”) increased by $3.3 million to $24.7 million at March 31, 2025 from $21.5 million at March 31, 2024.
    • The ACL represented 1.22% of total loans at March 31, 2025 and 1.18% at March 31, 2024.
    • The provision for credit loss was $681 thousand for the quarter ended March 31, 2025, an increase of $271 thousand compared to $410 thousand for the same period in 2024.
    • The ratio of non-performing loans to total loans was 0.20% at March 31, 2025 and 0.03% at March 31, 2024. Non-performing loans totaled $4.2 million at March 31, 2025 and $456 thousand at March 31, 2024.

    Non-interest Income and Non-interest Expense

    • Non-interest income was $3.7 million for the three months ended March 31, 2025, an increase of $1.3 million or 50.8% compared to $2.5 million for the same period in 2024.
    • Non-interest expense was $12.1 million for the three months ended March 31, 2025, an increase of $0.9 million or 7.9% compared to $11.2 million for the same period in 2024.

    Capital

    • On April 21, 2025, the Company’s Board of Directors declared a quarterly cash dividend of $0.10 per share of the Company’s Class A common stock. The dividend will be paid on June 5, 2025 to shareholders of record at the close of business on May 15, 2025.
    • As of March 31, 2025, total risk-based capital ratios for the Company and the Bank were 13.72% and 13.65%, respectively.
    • Tangible book value per common share (a non-GAAP measure) was $11.23 at March 31, 2025, representing increase of $0.42 or 3.9% from $10.81 at December 31, 2024. At March 31, 2025, tangible book value per common share was negatively affected by ($2.05) per share due to an accumulated comprehensive loss of $41.1 million mostly due to changes in the market value of the Company’s available for sale securities. At December 31, 2024, tangible book value per common share was negatively affected by ($2.24) per share due to an accumulated comprehensive loss of $44.5 million.

    Conference Call and Webcast

    The Company will host a conference call on Friday, April 25, 2025, at 11:00 a.m. Eastern Time to discuss the Company’s unaudited financial results for the quarter ended March 31, 2025. To access the conference call, dial (833) 816-1416 (U.S. toll-free) and ask to join the USCB Financial Holdings Call.

    Additionally, interested parties can listen to a live webcast of the call in the “Investor Relations” section of the Company’s website at www.uscentury.com. An archived version of the webcast will be available in the same location shortly after the live call has ended.

    About USCB Financial Holdings, Inc.

    USCB Financial Holdings, Inc. is the bank holding company for U.S. Century Bank. Established in 2002, U.S. Century Bank is one of the largest community banks headquartered in Miami, and one of the largest community banks in the State of Florida. U.S. Century Bank is rated 5-Stars by BauerFinancial, the nation’s leading independent bank rating firm. U.S. Century Bank offers customers a wide range of financial products and services and supports numerous community organizations, including the Greater Miami Chamber of Commerce, the South Florida Hispanic Chamber of Commerce, and ChamberSouth. For more information about us or to find a banking center near you, please call (305) 715-5200 or visit www.uscentury.com.

    Forward-Looking Statements

    This earnings release may contain statements that are not historical in nature and are intended to be, and are hereby identified as, forward-looking statements for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are those that are not historical facts. The words “may,” “will,” “anticipate,” “could,” “should,” “would,” “believe,” “contemplate,” “expect,” “aim,” “plan,” “estimate,” “seek,” “continue,” and “intend,”, the negative of these terms, as well as other similar words and expressions of the future, are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements related to our projected growth, anticipated future financial performance, and management’s long-term performance goals, as well as statements relating to the anticipated effects on our results of operations and financial condition from expected or potential developments or events, or business and growth strategies, including anticipated internal growth and balance sheet restructuring.

    These forward-looking statements involve significant risks and uncertainties that could cause our actual results to differ materially from those anticipated in such statements. Potential risks and uncertainties include, but are not limited to:

    • the strength of the United States economy in general and the strength of the local economies in which we conduct operations;
    • our ability to successfully manage interest rate risk, credit risk, liquidity risk, and other risks inherent to our industry;
    • the accuracy of our financial statement estimates and assumptions, including the estimates used for our credit loss reserve and deferred tax asset valuation allowance;
    • the efficiency and effectiveness of our internal control procedures and processes;
    • our ability to comply with the extensive laws and regulations to which we are subject, including the laws for each jurisdiction where we operate;
    • adverse changes or conditions in capital and financial markets, including actual or potential stresses in the banking industry;
    • deposit attrition and the level of our uninsured deposits;
    • legislative or regulatory changes and changes in accounting principles, policies, practices or guidelines, including the on-going effects of the Current Expected Credit Losses (“CECL”) standard;
    • the lack of a significantly diversified loan portfolio and the concentration in the South Florida market, including the risks of geographic, depositor, and industry concentrations, including our concentration in loans secured by real estate, in particular, commercial real estate;
    • the effects of climate change;
    • the concentration of ownership of our common stock;
    • fluctuations in the price of our common stock;
    • our ability to fund or access the capital markets at attractive rates and terms and manage our growth, both organic growth as well as growth through other means, such as future acquisitions;
    • inflation, interest rate, unemployment rate, and market and monetary fluctuations;
    • the effects of potential new or increased tariffs and trade restrictions
    • impacts of international hostilities and geopolitical events;
    • increased competition and its effect on the pricing of our products and services as well as our interest rate spread and net interest margin;
    • the loss of key employees;
    • the effectiveness of our risk management strategies, including operational risks, including, but not limited to, client, employee, or third-party fraud and security breaches; and
    • other risks described in this earnings release and other filings we make with the Securities and Exchange Commission (“SEC”).

    All forward-looking statements are necessarily only estimates of future results, and there can be no assurance  that actual results will not differ materially from expectations. Therefore, you are cautioned not to place undue reliance on any forward-looking statements. Further, forward-looking statements included in this earnings release are made only as of the date hereof, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events, unless required to do so under the federal securities laws. You should also review the risk factors described in the reports the Company filed or will file with the SEC.

    Non-GAAP Financial Measures

    This earnings release includes financial information determined by methods other than in accordance with generally accepted accounting principles (“GAAP”). This financial information includes certain operating performance measures. Management has included these non-GAAP measures because it believes these measures may provide useful supplemental information for evaluating the Company’s operations and underlying performance trends. Further, management uses these measures in managing and evaluating the Company’s business and intends to refer to them in discussions about our operations and performance. Operating performance measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures can be found in the ‘Non-GAAP Reconciliation Tables’ included in the exhibits to this earnings release.

    All numbers included in this press release are unaudited unless otherwise noted.

    Contacts:

    Investor Relations
    InvestorRelations@uscentury.com

    Media Relations
    Martha Guerra-Kattou
    MGuerra@uscentury.com

     
    USCB FINANCIAL HOLDINGS, INC.
    CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
    (Dollars in thousands, except per share data)
                   
      Three Months Ended March 31,
      2025   2024
    Interest income:              
    Loans, including fees $ 30,245     $ 26,643  
    Investment securities   3,024       2,811  
    Interest-bearing deposits in financial institutions   709       1,433  
    Total interest income   33,978       30,887  
    Interest expense:              
    Interest-bearing checking deposits   338       369  
    Savings and money market deposits   9,335       10,394  
    Time deposits   3,918       3,294  
    FHLB advances and other borrowings   1,272       1,672  
    Total interest expense   14,863       15,729  
    Net interest income before provision for credit losses   19,115       15,158  
    Provision for credit losses   681       410  
    Net interest income after provision for credit losses   18,434       14,748  
    Non-interest income:              
    Service fees   2,331       1,651  
    Gain on sale of loans held for sale, net   525       67  
    Other non-interest income   860       746  
    Total non-interest income   3,716       2,464  
    Non-interest expense:              
    Salaries and employee benefits   7,636       6,310  
    Occupancy   1,284       1,314  
    Regulatory assessments and fees   421       433  
    Consulting and legal fees   193       592  
    Network and information technology services   505       507  
    Other operating expense   2,013       2,018  
    Total non-interest expense   12,052       11,174  
    Net income before income tax expense   10,098       6,038  
    Income tax expense   2,440       1,426  
    Net income $ 7,658     $ 4,612  
    Per share information:              
    Net income per common share, basic $ 0.38     $ 0.23  
    Net income per common share, diluted $ 0.38     $ 0.23  
    Cash dividends declared $ 0.10     $ 0.05  
    Weighted average shares outstanding:              
    Common shares, basic   20,020,933       19,633,330  
    Common shares, diluted   20,319,535       19,698,258  
                   
     
    USCB FINANCIAL HOLDINGS, INC.
    SELECTED FINANCIAL DATA (UNAUDITED)
    (Dollars in thousands, except per share data)
                                 
      As of or For the Three Months Ended
      3/31/2025   12/31/2024   9/30/2024   6/30/2024   3/31/2024
    Income statement data:                            
    Net interest income $ 19,115     $ 19,358     $ 18,109     $ 17,311     $ 15,158  
    Provision for credit losses   681       1,030       931       786       410  
    Net interest income after provision for credit losses   18,434       18,328       17,178       16,525       14,748  
    Service fees   2,331       2,667       2,544       1,977       1,651  
    Gain on sale of securities available for sale, net                     14        
    Gain on sale of loans held for sale, net   525       154       109       417       67  
    Other income   860       806       785       803       746  
    Total non-interest income   3,716       3,627       3,438       3,211       2,464  
    Salaries and employee benefits   7,636       7,930       7,200       7,353       6,310  
    Occupancy   1,284       1,337       1,341       1,266       1,314  
    Regulatory assessments and fees   421       405       452       476       433  
    Consulting and legal fees   193       552       161       263       592  
    Network and information technology services   505       494       513       479       507  
    Other operating expense   2,013       2,136       1,787       1,723       2,018  
    Total non-interest expense   12,052       12,854       11,454       11,560       11,174  
    Net income before income tax expense   10,098       9,101       9,162       8,176       6,038  
    Income tax expense   2,440       2,197       2,213       1,967       1,426  
    Net income $ 7,658     $ 6,904     $ 6,949     $ 6,209     $ 4,612  
    Per share information:                            
    Net income per common share, basic $ 0.38     $ 0.35     $ 0.35     $ 0.32     $ 0.23  
    Net income per common share, diluted $ 0.38     $ 0.34     $ 0.35     $ 0.31     $ 0.23  
    Cash dividends declared $ 0.10     $ 0.05     $ 0.05     $ 0.05     $ 0.05  
    Balance sheet data (at period-end):                            
    Cash and cash equivalents $ 97,984     $ 77,035     $ 38,486     $ 77,261     $ 126,546  
    Securities available-for-sale $ 275,139     $ 260,221     $ 259,527     $ 236,444     $ 259,992  
    Securities held-to-maturity $ 161,790     $ 164,694     $ 167,001     $ 169,606     $ 173,038  
    Total securities $ 436,929     $ 424,915     $ 426,528     $ 406,050     $ 433,030  
    Loans held for investment (1) $ 2,036,212     $ 1,972,848     $ 1,931,362     $ 1,869,249     $ 1,821,196  
    Allowance for credit losses $ (24,740 )   $ (24,070 )   $ (23,067 )   $ (22,230 )   $ (21,454 )
    Total assets $ 2,677,382     $ 2,581,216     $ 2,503,954     $ 2,458,270     $ 2,489,142  
    Non-interest-bearing demand deposits $ 605,489     $ 575,159     $ 637,313     $ 579,243     $ 576,626  
    Interest-bearing deposits $ 1,704,080     $ 1,598,845     $ 1,489,304     $ 1,477,459     $ 1,526,168  
    Total deposits $ 2,309,569     $ 2,174,004     $ 2,126,617     $ 2,056,702     $ 2,102,794  
    FHLB advances and other borrowings $ 108,000     $ 163,000     $ 118,000     $ 162,000     $ 162,000  
    Total liabilities $ 2,452,294     $ 2,365,828     $ 2,290,038     $ 2,257,250     $ 2,294,131  
    Total stockholders’ equity $ 225,088     $ 215,388     $ 213,916     $ 201,020     $ 195,011  
    Capital ratios:(2)                            
    Leverage ratio   9.61 %     9.53 %     9.34 %     9.03 %     8.91 %
    Common equity tier 1 capital   12.48 %     12.28 %     12.01 %     11.93 %     11.80 %
    Tier 1 risk-based capital   12.48 %     12.28 %     12.01 %     11.93 %     11.80 %
    Total risk-based capital   13.72 %     13.51 %     13.22 %     13.12 %     12.98 %
                                 
    (1) Loan amounts include deferred fees/costs.
    (2) Reflects the Company’s regulatory capital ratios which are provided for informational purposes only; as a small bank holding company, the Company is not subject to regulatory capital requirements. The Bank’s total risk-based capital at March 31, 2025 was 13.65%.
     
    USCB FINANCIAL HOLDINGS, INC.
    AVERAGE BALANCES, RATIOS, AND OTHER DATA (UNAUDITED)
    (Dollars in thousands)
                                 
      As of or For the Three Months Ended
      3/31/2025   12/31/2024   9/30/2024   6/30/2024   3/31/2024
    Average balance sheet data:                            
    Cash and cash equivalents $ 82,610     $ 56,937     $ 87,937     $ 107,831     $ 132,266  
    Securities available-for-sale $ 265,154     $ 255,786     $ 244,882     $ 263,345     $ 239,896  
    Securities held-to-maturity $ 163,510     $ 165,831     $ 168,632     $ 171,682     $ 174,142  
    Total securities $ 428,664     $ 421,617     $ 413,514     $ 435,027     $ 414,038  
    Loans held for investment(1) $ 1,986,856     $ 1,958,566     $ 1,878,230     $ 1,828,487     $ 1,781,528  
    Total assets $ 2,606,593     $ 2,544,592     $ 2,485,434     $ 2,479,222     $ 2,436,103  
    Interest-bearing deposits $ 1,652,147     $ 1,547,789     $ 1,468,067     $ 1,473,513     $ 1,473,831  
    Non-interest-bearing demand deposits $ 563,040     $ 590,829     $ 609,456     $ 610,370     $ 574,760  
    Total deposits $ 2,215,187     $ 2,138,618     $ 2,077,523     $ 2,083,883     $ 2,048,591  
    FHLB advances and other borrowings $ 138,944     $ 151,804     $ 156,043     $ 162,000     $ 164,187  
    Total liabilities $ 2,387,088     $ 2,328,877     $ 2,278,793     $ 2,281,467     $ 2,243,011  
    Total stockholders’ equity $ 219,505     $ 215,715     $ 206,641     $ 197,755     $ 193,092  
    Performance ratios:                            
    Return on average assets (2)   1.19 %     1.08 %     1.11 %     1.01 %     0.76 %
    Return on average equity (2)   14.15 %     12.73 %     13.38 %     12.63 %     9.61 %
    Net interest margin (2)   3.10 %     3.16 %     3.03 %     2.94 %     2.62 %
    Non-interest income to average assets (2)   0.58 %     0.57 %     0.55 %     0.52 %     0.41 %
    Non-interest expense to average assets (2)   1.88 %     2.01 %     1.83 %     1.88 %     1.84 %
    Efficiency ratio (3)   52.79 %     55.92 %     53.16 %     56.33 %     63.41 %
    Loans by type (at period end): (4)                            
    Residential real estate $ 301,164     $ 297,979     $ 283,477     $ 256,807     $ 237,906  
    Commercial real estate $ 1,150,129     $ 1,128,399     $ 1,095,112     $ 1,053,030     $ 1,057,800  
    Commercial and industrial $ 256,326     $ 258,311     $ 246,539     $ 248,525     $ 228,045  
    Correspondent banks $ 103,026     $ 82,438     $ 103,815     $ 112,510     $ 100,182  
    Consumer and other $ 218,711     $ 198,091     $ 198,604     $ 194,644     $ 194,325  
    Asset quality data:                            
    Allowance for credit losses to total loans   1.22 %     1.22 %     1.19 %     1.19 %     1.18 %
    Allowance for credit losses to non-performing loans   595 %     889 %     846 %     2,933 %     4,705 %
    Total non-performing loans(5) $ 4,156     $ 2,707     $ 2,725     $ 758     $ 456  
    Non-performing loans to total loans   0.20 %     0.14 %     0.14 %     0.04 %     0.03 %
    Non-performing assets to total assets(5)   0.16 %     0.10 %     0.11 %     0.03 %     0.02 %
    Net charge-offs (recoveries of) to average loans (2)   0.00 %     (0.00 )%     (0.00 )%     (0.00 )%     (0.00 )%
    Net charge-offs (recovery) of credit losses $ 2     $ (11 )   $ (6 )   $ (2 )   $ (7 )
    Interest rates and yields:(2)                            
    Loans held for investment   6.17 %     6.25 %     6.32 %     6.16 %     6.01 %
    Investment securities   2.81 %     2.63 %     2.61 %     2.80 %     2.69 %
    Total interest-earning assets   5.51 %     5.57 %     5.61 %     5.54 %     5.34 %
    Deposits(6)   2.49 %     2.48 %     2.66 %     2.64 %     2.76 %
    FHLB advances and other borrowings   3.71 %     3.81 %     4.05 %     4.03 %     4.10 %
    Total interest-bearing liabilities   3.37 %     3.47 %     3.79 %     3.76 %     3.86 %
    Other information:                            
    Full-time equivalent employees   201       199       198       197       199  
                                 
    (1) Loan amounts include deferred fees/costs.
    (2) Annualized.
    (3) Efficiency ratio is defined as total non-interest expense divided by sum of net interest income and total non-interest income.
    (4) Loan amounts exclude deferred fees/costs.
    (5) The amounts for total non-performing loans and total non-performing assets are the same at the dates presented since there was no other real estate owned (OREO) recorded at any of the dates presented.
    (6) Reflects effect of non-interest-bearing deposits.
     
    USCB FINANCIAL HOLDINGS, INC.
    NET INTEREST MARGIN (UNAUDITED)
    (Dollars in thousands)
                                   
      Three Months Ended March 31,
      2025     2024  
      Average
    Balance
      Interest   Yield/Rate (1)   Average
    Balance
      Interest   Yield/Rate (1)
    Assets                              
    Interest-earning assets:                              
    Loans held for investment(2) $ 1,986,856   $ 30,245   6.17 %   $ 1,781,528   $ 26,643   6.01 %
    Investment securities (3)   436,935     3,024   2.81 %     419,989     2,811   2.69 %
    Other interest-earning assets   75,182     709   3.82 %     125,244     1,433   4.60 %
    Total interest-earning assets   2,498,973     33,978   5.51 %     2,326,761     30,887   5.34 %
    Non-interest-earning assets   107,620               109,342          
    Total assets $ 2,606,593             $ 2,436,103          
    Liabilities and stockholders’ equity                              
    Interest-bearing liabilities:                              
    Interest-bearing checking deposits $ 53,611     338   2.56 %   $ 53,344     369   2.78 %
    Saving and money market deposits   1,199,027     9,335   3.16 %     1,097,575     10,394   3.81 %
    Time deposits   399,509     3,918   3.98 %     322,912     3,294   4.10 %
    Total interest-bearing deposits   1,652,147     13,591   3.34 %     1,473,831     14,057   3.84 %
    FHLB advances and other borrowings   138,944     1,272   3.71 %     164,187     1,672   4.10 %
    Total interest-bearing liabilities   1,791,091     14,863   3.37 %     1,638,018     15,729   3.86 %
    Non-interest-bearing demand deposits   563,040               574,760          
    Other non-interest-bearing liabilities   32,957               30,233          
    Total liabilities   2,387,088               2,243,011          
    Stockholders’ equity   219,505               193,092          
    Total liabilities and stockholders’ equity $ 2,606,593             $ 2,436,103          
    Net interest income       $ 19,115             $ 15,158    
    Net interest spread (4)             2.14 %               1.48 %
    Net interest margin (5)             3.10 %               2.62 %
                                   
    (1) Annualized.
    (2) Average loan balances include non-accrual loans. Interest income on loans includes accretion of deferred loan fees, net of deferred loan costs.
    (3) At fair value except for securities held to maturity. This amount includes FHLB stock.
    (4) Net interest spread is the average yield earned on total interest-earning assets minus the average rate paid on total interest-bearing liabilities.
    (5) Net interest margin is the ratio of net interest income to total interest-earning assets.
     
    USCB FINANCIAL HOLDINGS, INC.
    NON-GAAP FINANCIAL MEASURES (UNAUDITED)
    (Dollars in thousands)
                                 
      As of or For the Three Months Ended
      3/31/2025   12/31/2024   9/30/2024   6/30/2024   3/31/2024
    Pre-tax pre-provision (“PTPP”) income:(1)                            
    Net income $ 7,658     $ 6,904     $ 6,949     $ 6,209     $ 4,612  
    Plus: Provision for income taxes   2,440       2,197       2,213       1,967       1,426  
    Plus: Provision for credit losses   681       1,030       931       786       410  
    PTPP income $ 10,779     $ 10,131     $ 10,093     $ 8,962     $ 6,448  
                                 
    PTPP return on average assets:(1)                            
    PTPP income $ 10,779     $ 10,131     $ 10,093     $ 8,962     $ 6,448  
    Average assets $ 2,606,593     $ 2,544,592     $ 2,485,434     $ 2,479,222     $ 2,436,103  
    PTPP return on average assets (2)   1.68 %     1.58 %     1.62 %     1.45 %     1.06 %
                                 
    Operating net income:(1)                            
    Net income $ 7,658     $ 6,904     $ 6,949     $ 6,209     $ 4,612  
    Less: Net gains on sale of securities                     14        
    Less: Tax effect on sale of securities                     (4 )      
    Operating net income $ 7,658     $ 6,904     $ 6,949     $ 6,199     $ 4,612  
                                 
    Operating PTPP income:(1)                            
    PTPP income $ 10,779     $ 10,131     $ 10,093     $ 8,962     $ 6,448  
    Less: Net gains on sale of securities                     14        
    Operating PTPP income $ 10,779     $ 10,131     $ 10,093     $ 8,948     $ 6,448  
                                 
    Operating PTPP return on average assets:(1)                            
    Operating PTPP income $ 10,779     $ 10,131     $ 10,093     $ 8,948     $ 6,448  
    Average assets $ 2,606,593     $ 2,544,592     $ 2,485,434     $ 2,479,222     $ 2,436,103  
    Operating PTPP return on average assets (2)   1.68 %     1.58 %     1.62 %     1.45 %     1.06 %
                                 
    Operating return on average assets:(1)                            
    Operating net income $ 7,658     $ 6,904     $ 6,949     $ 6,199     $ 4,612  
    Average assets $ 2,606,593     $ 2,544,592     $ 2,485,434     $ 2,479,222     $ 2,436,103  
    Operating return on average assets (2)   1.19 %     1.08 %     1.11 %     1.01 %     0.76 %
                                 
    Operating return on average equity:(1)                            
    Operating net income $ 7,658     $ 6,904     $ 6,949     $ 6,199     $ 4,612  
    Average equity $ 219,505     $ 215,715     $ 206,641     $ 197,755     $ 193,092  
    Operating return on average equity (2)   14.15 %     12.73 %     13.38 %     12.61 %     9.61 %
                                 
    Operating Revenue:(1)                            
    Net interest income $ 19,115     $ 19,358     $ 18,109     $ 17,311     $ 15,158  
    Non-interest income   3,716       3,627       3,438       3,211       2,464  
    Less: Net gains on sale of securities                     14        
    Operating revenue $ 22,831     $ 22,985     $ 21,547     $ 20,508     $ 17,622  
                                 
    Operating Efficiency Ratio:(1)                            
    Total non-interest expense $ 12,052     $ 12,854     $ 11,454     $ 11,560     $ 11,174  
    Operating revenue $ 22,831     $ 22,985     $ 21,547     $ 20,508     $ 17,622  
    Operating efficiency ratio   52.79 %     55.92 %     53.16 %     56.37 %     63.41 %
                                 
    (1) The Company believes these non-GAAP measurements are key indicators of the ongoing earnings power of the Company.
    (2) Annualized.
     
    USCB FINANCIAL HOLDINGS, INC.
    NON-GAAP FINANCIAL MEASURES (UNAUDITED)
    (Dollars in thousands, except per share data)
                                 
      As of or For the Three Months Ended
      3/31/2025   12/31/2024   9/30/2024   6/30/2024   3/31/2024
    Tangible book value per common share (at period-end):(1)                            
    Total stockholders’ equity $ 225,088     $ 215,388     $ 213,916     $ 201,020     $ 195,011  
    Less: Intangible assets                            
    Tangible stockholders’ equity $ 225,088     $ 215,388     $ 213,916     $ 201,020     $ 195,011  
    Total shares issued and outstanding (at period-end):                            
    Total common shares issued and outstanding   20,048,385       19,924,632       19,620,632       19,630,632       19,650,463  
    Tangible book value per common share(2) $ 11.23     $ 10.81     $ 10.90     $ 10.24     $ 9.92  
                                 
    Operating diluted net income per common share:(1)                            
    Operating net income $ 7,658     $ 6,904     $ 6,949     $ 6,199     $ 4,612  
    Total weighted average diluted shares of common stock   20,319,535       20,183,731       19,825,211       19,717,167       19,698,258  
    Operating diluted net income per common share: $ 0.38     $ 0.34     $ 0.35     $ 0.31     $ 0.23  
                                 
    Tangible Common Equity/Tangible Assets(1)                            
    Tangible stockholders’ equity $ 225,088     $ 215,388     $ 213,916     $ 201,020     $ 195,011  
    Tangible total assets(3) $ 2,677,382     $ 2,581,216     $ 2,503,954     $ 2,458,270     $ 2,489,142  
    Tangible Common Equity/Tangible Assets   8.41 %     8.34 %     8.54 %     8.18 %     7.83 %
                                 
    (1) The Company believes these non-GAAP measurements are key indicators of the ongoing earnings power of the Company.
    (2) Excludes the dilutive effect, if any, of shares of common stock issuable upon exercise of outstanding stock options.
    (3) Since the Company has no intangible assets, tangible total assets is the same amount as total assets calculated under GAAP.

    The MIL Network

  • MIL-OSI: Glacier Bancorp, Inc. Announces Results For the Quarter and Period Ended March 31, 2025

    Source: GlobeNewswire (MIL-OSI)

    1st Quarter 2025 Highlights:

    • Diluted earnings per share for the current quarter was $0.48 per share, a decrease of 11 percent from the prior quarter diluted earnings per share of $0.54 per share and an increase of 66 percent from the prior year first quarter diluted earnings per share of $0.29 per share.
    • Net income was $54.6 million for the current quarter, a decrease of $7.2 million, or 12 percent, from the prior quarter net income of $61.8 million and an increase of $21.9 million, or 67 percent, from the prior year first quarter net income of $32.6 million.
    • The net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 3.04 percent, an increase of 7 basis points from the prior quarter net interest margin of 2.97 percent and an increase of 45 basis points from the prior year first quarter net interest margin of 2.59 percent.
    • Total deposits of $20.634 billion increased $87.1 million, or 2 percent annualized, during the current quarter.
    • The loan yield of 5.77 percent in the current quarter increased 5 basis points from the prior quarter loan yield of 5.72 percent and increased 31 basis points from the prior year first quarter loan yield of 5.46 percent.
    • The total earning asset yield of 4.61 percent in the current quarter increased 4 basis points from the prior quarter earning asset yield of 4.57 percent and increased 30 basis points from the prior year first quarter earning asset yield of 4.31 percent.
    • The total core deposit cost (including non-interest bearing deposits) of 1.25 percent in the current quarter decreased 4 basis point from the prior quarter total core deposit cost of 1.29 percent.
    • The total cost of funding (including non-interest bearing deposits) of 1.68 percent in the current quarter decreased 3 basis point from the prior quarter total cost of funding of 1.71 percent.
    • The Company declared a quarterly dividend of $0.33 per share. The Company has declared 160 consecutive quarterly dividends and has increased the dividend 49 times.
    • The Company announced the signing of a definitive agreement to acquire Bank of Idaho Holding Co., the bank holding company for Bank of Idaho (collectively, “BOID”) which had total assets of $1.3 billion as of March 31, 2025. This will be the Company’s 26th bank acquisition since 2000 and its 12th announced transaction in the past 10 years.

    Financial Summary  

      At or for the Three Months ended
    (Dollars in thousands, except per share and market data) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
    Operating results          
    Net income $ 54,568     61,754     32,627  
    Basic earnings per share $ 0.48     0.54     0.29  
    Diluted earnings per share $ 0.48     0.54     0.29  
    Dividends declared per share $ 0.33     0.33     0.33  
    Market value per share          
    Closing $ 44.22     50.22     40.28  
    High $ 52.81     60.67     42.75  
    Low $ 43.18     43.70     34.74  
    Selected ratios and other data          
    Number of common stock shares outstanding   113,517,944     113,401,955     113,388,590  
    Average outstanding shares – basic   113,451,199     113,398,213     112,492,142  
    Average outstanding shares – diluted   113,546,365     113,541,026     112,554,402  
    Return on average assets (annualized)   0.80 %   0.87 %   0.47 %
    Return on average equity (annualized)   6.77 %   7.62 %   4.25 %
    Efficiency ratio   65.49 %   60.50 %   74.41 %
    Loan to deposit ratio   83.64 %   84.17 %   82.04 %
    Number of full time equivalent employees   3,457     3,441     3,438  
    Number of locations   227     227     232  
    Number of ATMs   286     284     285  
                       

    KALISPELL, Mont., April 24, 2025 (GLOBE NEWSWIRE) — Glacier Bancorp, Inc. (NYSE: GBCI) reported net income of $54.6 million for the current quarter, a decrease of $7.2 million, or 12 percent from the prior quarter net income of $61.8 million and an increase of $21.9 million, or 67 percent, from the $32.6 million of net income for the prior year first quarter. Diluted earnings per share for the current quarter was $0.48 per share, a decrease of 11 percent from the prior quarter diluted earnings per share of $0.54 per share and an increase of 65 percent from the prior year first quarter diluted earnings per share of $0.29. “We are very pleased with the long-term positive trends we see in our Company. Deposit costs are decreasing, loan yields are increasing, and margin continues to grow,” said Randy Chesler, President and Chief Executive Officer. “While uncertainty about the economy persists, we remain optimistic about our customers’ ability to quickly adapt to a changing environment.”

    On January 13, 2025, the Company announced the signing of a definitive agreement to acquire BOID with 15 branches across eastern Idaho, Boise and eastern Washington. As of March 31, 2025, BOID had total assets of $1.3 billion, total loans of $1.1 billion and total deposits of $1.1 billion. Upon closing of the transaction, the BOID operations will join three existing Glacier Bank divisions. The Eastern Idaho operations of Bank of Idaho will join Citizens Community Bank, the Boise operations will join Mountain West Bank and the Eastern Washington operations will join Wheatland Bank. The acquisition has received all required regulatory approvals and is scheduled to close on April 30, 2025, subject to satisfaction of the remaining conditions set forth in the merger agreement and the approval by the BOID shareholders.

    Asset Summary

                  $ Change from
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Dec 31,
    2024
      Mar 31,
    2024
    Cash and cash equivalents $ 981,485     848,408     788,660     133,077     192,825  
    Debt securities, available-for-sale   4,172,312     4,245,205     4,629,073     (72,893 )   (456,761 )
    Debt securities, held-to-maturity   3,261,575     3,294,847     3,451,583     (33,272 )   (190,008 )
    Total debt securities   7,433,887     7,540,052     8,080,656     (106,165 )   (646,769 )
    Loans receivable                  
    Residential real estate   1,850,079     1,858,929     1,752,514     (8,850 )   97,565  
    Commercial real estate   10,952,809     10,963,713     10,672,269     (10,904 )   280,540  
    Other commercial   3,121,477     3,119,535     3,030,608     1,942     90,869  
    Home equity   920,132     930,994     883,062     (10,862 )   37,070  
    Other consumer   374,021     388,678     394,049     (14,657 )   (20,028 )
    Loans receivable   17,218,518     17,261,849     16,732,502     (43,331 )   486,016  
    Allowance for credit losses   (210,400 )   (206,041 )   (198,779 )   (4,359 )   (11,621 )
    Loans receivable, net   17,008,118     17,055,808     16,533,723     (47,690 )   474,395  
    Other assets   2,435,389     2,458,719     2,419,131     (23,330 )   16,258  
    Total assets $ 27,858,879     27,902,987     27,822,170     (44,108 )   36,709  
                                   

    The Company continues to maintain a strong cash position of $981 million at March 31, 2025 which was an increase of $133 million over the prior quarter and an increase of $193 million over the prior year first quarter. Total debt securities of $7.434 billion at March 31, 2025 decreased $106 million, or 1 percent, during the current quarter and decreased $647 million, or 8 percent, from the prior year first quarter. Debt securities represented 27 percent of total assets at March 31, 2025 and December 31, 2024 compared to 29 percent at March 31, 2024.

    The loan portfolio of $17.219 billion at March 31, 2025 decreased $43 million, or 25 basis points, during the current quarter and increased $486 million, or 3 percent, from the prior year first quarter. Excluding the Rocky Mountain Bank (“RMB”) acquisition on July 19, 2024, the loan portfolio organically increased $214 million, or 1 percent, since the prior year first quarter. Excluding the RMB acquisition, the loan category with the largest dollar increase in the last twelve months was commercial real estate which increased $159 million, or 1 percent.

    Credit Quality Summary

      At or for the
    Three Months ended
      At or for the
    Year ended
      At or for the
    Three Months ended
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
    Allowance for credit losses          
    Balance at beginning of period $ 206,041     192,757     192,757  
    Acquisitions       3     3  
    Provision for credit losses   6,154     27,179     9,091  
    Charge-offs   (3,897 )   (18,626 )   (4,295 )
    Recoveries   2,102     4,728     1,223  
    Balance at end of period $ 210,400     206,041     198,779  
    Provision for credit losses          
    Loan portfolio $ 6,154     27,179     9,091  
    Unfunded loan commitments   1,660     1,127     (842 )
    Total provision for credit losses $ 7,814     28,306     8,249  
    Other real estate owned $ 1,085     1,085     432  
    Other foreclosed assets   68     79     459  
    Accruing loans 90 days or more past due   5,289     6,177     3,796  
    Non-accrual loans   32,896     20,445     20,738  
    Total non-performing assets $ 39,338     27,786     25,425  
    Non-performing assets as a percentage of subsidiary assets   0.14 %   0.10 %   0.09 %
    Allowance for credit losses as a percentage of non-performing loans   551 %   774 %   810 %
    Allowance for credit losses as a percentage of total loans   1.22 %   1.19 %   1.19 %
    Net charge-offs as a percentage of total loans   0.01 %   0.08 %   0.02 %
    Accruing loans 30-89 days past due $ 46,458     32,228     62,423  
    U.S. government guarantees included in non-performing assets $ 685     748     1,490  
                       

    Non-performing assets as a percentage of subsidiary assets at March 31, 2025 was 0.14 percent compared to 0.10 percent in the prior quarter and 0.09 percent in the prior year first quarter. Non-performing assets of $39.3 million at March 31, 2025 increased $11.6 million, or 42 percent, over the prior quarter and increased $13.9 million, or 55 percent, over the prior year first quarter. The increase in the non-performing loans in the current quarter was primarily attributable to a single credit relationship.

    Early stage delinquencies (accruing loans 30-89 days past due) as a percentage of loans at March 31, 2025 were 0.27 percent compared to 0.19 percent for the prior quarter end and 0.37 percent for the prior year first quarter. Early stage delinquencies of $46.5 million at March 31, 2025 increased $14.2 million from the prior quarter and decreased $16.0 million from prior year first quarter.

    The current quarter credit loss expense of $7.8 million included $6.2 million of provision for credit losses on loans and $1.7 million of provision for credit losses on unfunded commitments.

    The allowance for credit losses (“ACL”) on loans as a percentage of total loans outstanding at March 31, 2025 was 1.22 percent compared to 1.19 percent at year end and the prior year first quarter. Loan portfolio growth, composition, average loan size, credit quality considerations, economic forecasts, actual results, and other environmental factors will continue to determine the level of the provision for credit losses for loans. 

    Credit Quality Trends and Provision for Credit Losses on the Loan Portfolio

    (Dollars in thousands) Provision for
    Credit Losses Loans
      Net Charge-Offs   ACL
    as a Percent
    of Loans
      Accruing
    Loans 30-89
    Days Past Due
    as a Percent of
    Loans
      Non-Performing
    Assets to
    Total Subsidiary
    Assets
    First quarter 2025 $ 6,154   $ 1,795   1.22 %   0.27 %   0.14 %
    Fourth quarter 2024   6,041     5,170   1.19 %   0.19 %   0.10 %
    Third quarter 2024   6,981     2,766   1.19 %   0.33 %   0.10 %
    Second quarter 2024   5,066     2,890   1.19 %   0.29 %   0.06 %
    First quarter 2024   9,091     3,072   1.19 %   0.37 %   0.09 %
    Fourth quarter 2023   4,181     3,695   1.19 %   0.31 %   0.09 %
    Third quarter 2023   5,095     2,209   1.19 %   0.09 %   0.15 %
    Second quarter 2023   5,254     2,473   1.19 %   0.16 %   0.12 %
                                 

    Net charge-offs for the current quarter were $1.8 million compared to $5.2 million in the prior quarter and $3.1 million for the prior year first quarter. The current quarter net charge-offs included $1.9 million in deposit overdraft net charge-offs and $78 thousand of net loan recoveries.

    Supplemental information regarding credit quality and identification of the Company’s loan portfolio based on the regulatory classification of loans is provided in the exhibits at the end of this press release. The regulatory classification of loans is based primarily on collateral type while the Company’s loan segments presented herein are based on the purpose of the loan.

    Liability Summary

                  $ Change from
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Dec 31,
    2024
      Mar 31,
    2024
    Deposits                  
    Non-interest bearing deposits $ 6,100,548   6,136,709   6,055,069   (36,161 )   45,479  
    NOW and DDA accounts   5,676,177   5,543,512   5,376,605   132,665     299,572  
    Savings accounts   2,896,378   2,845,124   2,949,908   51,254     (53,530 )
    Money market deposit accounts   2,816,874   2,878,213   3,002,942   (61,339 )   (186,068 )
    Certificate accounts   3,140,333   3,139,821   3,039,190   512     101,143  
    Core deposits, total   20,630,310   20,543,379   20,423,714   86,931     206,596  
    Wholesale deposits   3,740   3,615   3,809   125     (69 )
    Deposits, total   20,634,050   20,546,994   20,427,523   87,056     206,527  
    Repurchase agreements   1,849,070   1,777,475   1,540,008   71,595     309,062  
    Deposits and repurchase agreements, total   22,483,120   22,324,469   21,967,531   158,651     515,589  
    Federal Home Loan Bank advances   1,520,000   1,800,000   2,140,157   (280,000 )   (620,157 )
    Other borrowed funds   82,443   83,341   88,814   (898 )   (6,371 )
    Subordinated debentures   133,145   133,105   132,984   40     161  
    Other liabilities   352,563   338,218   381,977   14,345     (29,414 )
    Total liabilities $ 24,571,271   24,679,133   24,711,463   (107,862 )   (140,192 )
                             

    Total deposits of $20.634 billion at March 31, 2025 increased $87.1 million, or 2 percent annualized, from the prior quarter and increased $207 million, or 1 percent, from the prior year first quarter. Total repurchase agreements of $1.849 billion at March 31, 2025 increased $71.6 million, or 4 percent, from the prior quarter and increased $309 million, or 20 percent, from the prior year first quarter. Total deposits organically decreased $190 million, or 1 percent, from the prior year first quarter and total deposits and repurchase agreements organically increased $115 million, or 52 basis points, from the prior year first quarter. Non-interest bearing deposits represented 30 percent of total deposits at March 31, 2025, December 31, 2024 and March 31, 2024. Federal Home Loan Bank (“FHLB”) advances of $1.520 billion decreased $280 million, or 16 percent, from the prior quarter and decreased $620 million, or 29 percent, from the prior year first quarter.

    Stockholders’ Equity Summary

                  $ Change from
    (Dollars in thousands, except per share data) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Dec 31,
    2024
      Mar 31,
    2024
    Common equity $ 3,550,719     3,533,150     3,483,012     17,569   67,707  
    Accumulated other comprehensive loss   (263,111 )   (309,296 )   (372,305 )   46,185   109,194  
    Total stockholders’ equity   3,287,608     3,223,854     3,110,707     63,754   176,901  
    Goodwill and intangibles, net   (1,099,229 )   (1,102,500 )   (1,069,808 )   3,271   (29,421 )
    Tangible stockholders’ equity $ 2,188,379     2,121,354     2,040,899     67,025   147,480  
    Stockholders’ equity to total assets   11.80 %   11.55 %   11.18 %          
    Tangible stockholders’ equity to total tangible assets   8.18 %   7.92 %   7.63 %          
    Book value per common share $ 28.96     28.43     27.43     0.53   1.53  
    Tangible book value per common share $ 19.28     18.71     18.00      0.57   1.28  
                                 

    Tangible stockholders’ equity of $2.188 billion at March 31, 2025 increased $67.0 million, or 3 percent, compared to the prior quarter and was primarily the result of a decrease in unrealized loss on the available-for-sale debt securities and earnings retention. Tangible stockholders’ equity at March 31, 2025 increased $147 million, or 7 percent, compared to the prior year first quarter and was primarily due to the decrease in unrealized loss on the available-for-sale debt securities and earnings retention. The increase was partially offset by the increase in goodwill and core deposits associated with the RMB acquisition. Tangible book value per common share of $19.28 at the current quarter end increased $0.57 per share, or 3 percent, from the prior quarter and increased $1.28 per share, or 7 percent, from the prior year first quarter.

    Cash Dividends
    On March 26, 2025, the Company’s Board of Directors declared a quarterly cash dividend of $0.33 per share. The dividend was payable April 17, 2025 to shareholders of record on April 8, 2025. The dividend was the Company’s 160th consecutive regular dividend. Future cash dividends will depend on a variety of factors, including net income, capital, asset quality, general economic conditions and regulatory considerations.

    Operating Results for Three Months Ended March 31, 2025 
    Compared to December 31, 2024, and March 31, 2024

    Income Summary

      Three Months ended   $ Change from
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Dec 31,
    2024
      Mar 31,
    2024
    Net interest income                  
    Interest income $ 289,925     297,036     279,402     (7,111 )   10,523  
    Interest expense   99,946     105,593     112,922     (5,647 )   (12,976 )
    Total net interest income   189,979     191,443     166,480     (1,464 )   23,499  
                       
    Non-interest income                  
    Service charges and other fees   18,818     20,322     18,563     (1,504 )   255  
    Miscellaneous loan fees and charges   4,664     4,541     4,362     123     302  
    Gain on sale of loans   4,311     3,926     3,362     385     949  
    Gain on sale of securities           16         (16 )
    Other income   4,849     2,760     3,686     2,089     1,163  
    Total non-interest income   32,642     31,549     29,989     1,093     2,653  
    Total income $ 222,621     222,992     196,469     (371 )   26,152  
    Net interest margin (tax-equivalent)   3.04 %   2.97 %   2.59 %        
                               

    Net Interest Income
    Net interest income of $190 million for the current quarter decreased $1.5 million, or 1 percent, from the prior quarter net interest income of $191 million and increased $23.5 million, or 14 percent, from the prior year first quarter net interest income of $166 million. The current quarter interest income of $290 million decreased $7.1 million, or 2 percent, over the prior quarter and was primarily driven by fewer days in the current quarter coupled with decreased average interest-bearing cash balances. The current quarter interest income increased $10.5 million, or 4 percent, over the prior year first quarter primarily due to the increase in the loan yields and the increase in average balances of the loan portfolio. The loan yield of 5.77 percent in the current quarter increased 5 basis points from the prior quarter loan yield of 5.72 percent and increased 31 basis points from the prior year first quarter loan yield of 5.46 percent.

    The current quarter interest expense of $99.9 million decreased $5.6 million, or 5 percent, over the prior quarter and was primarily attributable to a decrease in deposit costs. The current quarter interest expense decreased $13.0 million, or 11 percent, over the prior year first quarter and was primarily the result of lower average wholesale borrowings and a decrease in deposit costs. Core deposit cost (including non-interest bearing deposits) was 1.25 percent for the current quarter compared to 1.29 percent in the prior quarter and 1.34 percent for the prior year first quarter. The total cost of funding (including non-interest bearing deposits) of 1.68 percent in the current quarter decreased 3 basis points from the prior quarter and decreased 16 basis point from the prior year first quarter.

    The net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 3.04 percent, an increase of 7 basis points from the prior quarter net interest margin of 2.97 percent and was primarily driven by an increase in loan yields and a decrease in total cost of funding. The net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was an increase of 45 basis points from the prior year first quarter net interest margin of 2.59 percent and was primarily driven by the increase in loan yields and the decrease in core deposit cost. Core net interest margin excludes the impact from discount accretion and non-accrual interest. Excluding the 5 basis points from discount accretion, the core net interest margin was 2.99 percent in the current quarter compared to 2.97 percent in the prior quarter and 2.59 in the prior year first quarter. “The Company’s net interest margin increased for the fifth consecutive quarter,” said Ron Copher, Chief Financial Officer. “The continued increase in loan yields and decrease in the deposit costs contributed to the 7 basis points increase in the net interest margin as it expanded to 3.04 percent in the current quarter.”

    Non-interest Income
    Non-interest income for the current quarter totaled $32.6 million, which was an increase of $1.1 million, or 3 percent, over the prior quarter and an increase of $2.7 million, or 9 percent, over the prior year first quarter. Service charges and other fees of $18.8 million for the current quarter decreased $1.5 million, or 7 percent, compared to the prior quarter and increased $255 thousand, or 1 percent, compared to the prior year first quarter. Gain on the sale of residential loans of $4.3 million for the current quarter increased $385 thousand, or 10 percent, compared to the prior quarter and increased $949 thousand, or 28 percent, from the prior year first quarter. Other income of $4.8 million increased $2.1 million, or 75 percent, over the prior quarter primarily due to other income of $1.1 million related to bank owned life insurance proceeds coupled with an increase in income from equity investments and other one-time adjustments. Other income increased $1.2 million, or 32 percent, over the prior year first quarter primarily due to the current quarter proceeds from bank owned life insurance.

    Non-interest Expense Summary

      Three Months ended   $ Change from
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Dec 31,
    2024
      Mar 31,
    2024
    Compensation and employee benefits $ 91,443   81,600   85,789   9,843     5,654  
    Occupancy and equipment   12,294   11,589   11,883   705     411  
    Advertising and promotions   4,144   3,725   3,983   419     161  
    Data processing   9,138   9,145   9,159   (7 )   (21 )
    Other real estate owned and foreclosed assets   63   30   25   33     38  
    Regulatory assessments and insurance   5,534   5,890   7,761   (356 )   (2,227 )
    Intangibles amortization   3,270   3,613   2,760   (343 )   510  
    Other expenses   25,432   25,373   30,483   59     (5,051 )
    Total non-interest expense $ 151,318   140,965   151,843   10,353     (525 )
                             

    Total non-interest expense of $151 million for the current quarter increased $10.4 million, or 7 percent, over the prior quarter and decreased $525 thousand, or 35 basis points, over the prior year first quarter. Compensation and employee benefits of $91.4 million increased by $9.8 million, or 12 percent, over the prior quarter and was primarily attributable to increased performance-related compensation. Compensation and employee benefits increased $5.6 million, or 7 percent, from the prior year first quarter and was primarily driven by annual salary increases and increases in staffing levels from prior year acquisitions. Regulatory assessment and insurance expense of $5.5 million decreased $2.2 million from the prior year first quarter as a result of adjustments to the FDIC special assessment.

    Other expenses of $25.4 million increased $59 thousand, or 23 basis points, from the prior quarter. Other expenses decreased $5.1 million, or 17 percent, from the prior year first quarter and was primarily driven by a decrease in acquisition-related expense. Acquisition-related expense was $587 thousand in the current quarter compared to $491 thousand in the prior quarter and $5.7 million in the prior year first quarter. The current quarter other expenses included $1.2 million of gain from the sale of a former branch facility compared to a $2.1 million gain in the prior quarter and a $989 thousand gain in the prior year first quarter.

    Federal and State Income Tax Expense

    Tax expense during the first quarter of 2025 was $8.9 million, a decrease of $2.8 million, or 24 percent, compared to the prior quarter and an increase of $5.2 million, or 138 percent, from the prior year first quarter. The effective tax rate in the current quarter was 14.1 percent compared to 16.0 percent in the prior quarter. The lower tax expense and lower effective tax rate in the current quarter compared to the prior quarter was the result of a combination of higher federal income tax credits and a decrease in income before income tax expense.

    Efficiency Ratio
    The efficiency ratio was 65.49 percent in the current quarter compared to 60.50 percent in the prior quarter and 74.41 percent in the prior year first quarter. The increase from the prior quarter was principally driven by the decrease in net interest income combined with an increase in non-interest expense. The decrease from the prior year first quarter was principally due to the increase in net interest income.

    Forward-Looking Statements  
    This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about the Company’s plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as “expects,” “anticipates,” “will,” “intends,” “plans,” “believes,” “should,” “projects,” “seeks,” “estimates” or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company’s control. In addition, these forward-looking statements are based on assumptions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results (express or implied) or other expectations in the forward-looking statements, including those made in this news release:

    • risks associated with lending and potential adverse changes in the credit quality of the Company’s loan portfolio;
    • changes in monetary and fiscal policies, including interest rate policies of the Federal Reserve Board, which could adversely affect the Company’s net interest income and margin, the fair value of its financial instruments, profitability, and stockholders’ equity;
    • legislative or regulatory changes, including increased FDIC insurance rates and assessments, changes in the review and regulation of bank mergers, or increased banking and consumer protection regulations, that may adversely affect the Company’s business and strategies;
    • risks related to overall economic conditions, including the impact on the economy of an uncertain interest rate environment, inflationary pressures and the potential for significant changes in economic and trade policies in the new administration;
    • risks to the Company’s business and the business of the Company’s customers arising from current or future tariffs or other trade restrictions, labor or supply chain issues, change in labor force, or geopolitical instability, including the wars in Ukraine and the Middle East;
    • risks associated with the Company’s ability to negotiate, complete, and successfully integrate any pending or future acquisitions;
    • costs or difficulties related to the completion and integration of pending or future acquisitions;
    • impairment of the goodwill recorded by the Company in connection with acquisitions, which may have an adverse impact on earnings and capital;
    • reduction in demand for banking products and services, whether as a result of changes in customer behavior, economic conditions, banking environment, or competition;
    • deterioration of the reputation of banks and the financial services industry, which could adversely affect the Company’s ability to obtain and maintain customers;
    • changes in the competitive landscape, including as may result from new market entrants or further consolidation in the financial services industry, resulting in the creation of larger competitors with greater financial resources;
    • risks presented by public stock market volatility, which could adversely affect the market price of the Company’s common stock and the ability to raise additional capital or grow through acquisitions;
    • risks associated with dependence on the Chief Executive Officer, the senior management team and the Presidents of Glacier Bank’s divisions;
    • material failure, potential interruption or breach in security of the Company’s systems or changes in technology which could expose the Company to cybersecurity risks, fraud, system failures, or direct liabilities;
    • risks related to natural disasters, including droughts, fires, floods, earthquakes, pandemics, and other unexpected events;
    • success in managing risks involved in any of the foregoing; and
    • effects of any reputational damage to the Company resulting from any of the foregoing.

    The Company does not undertake any obligation to publicly correct or update any forward-looking statement if it later becomes aware that actual results are likely to differ materially from those expressed in such forward-looking statement.

    Conference Call Information
    A conference call for investors is scheduled for 11:00 a.m. Eastern Time on Friday, April 25, 2025. Please note that our conference call host no longer offers a general dial-in number. Investors who would like to join the call may now register by following this link to obtain dial-in instructions: https://register-conf.media-server.com/register/BI3016c4b5b4bd4b0aac8f022e74f4c1d4. To participate via the webcast, log on to: https://edge.media-server.com/mmc/p/ejk9q5pb

    About Glacier Bancorp, Inc.
    Glacier Bancorp, Inc. (NYSE: GBCI), a member of the Russell 2000® and the S&P MidCap 400® indices, is the parent company for Glacier Bank and its Bank divisions located across its eight state Western U.S. footprint: Altabank (American Fork, UT), Bank of the San Juans (Durango, CO), Citizens Community Bank (Pocatello, ID), Collegiate Peaks Bank (Buena Vista, CO), First Bank of Montana (Lewistown, MT), First Bank of Wyoming (Powell, WY), First Community Bank Utah (Layton, UT), First Security Bank (Bozeman, MT), First Security Bank of Missoula (Missoula, MT), First State Bank (Wheatland, WY), Glacier Bank (Kalispell, MT), Heritage Bank of Nevada (Reno, NV), Mountain West Bank (Coeur d’Alene, ID), The Foothills Bank (Yuma, AZ), Valley Bank (Helena, MT), Western Security Bank (Billings, MT), and Wheatland Bank (Spokane, WA).

    CONTACT: Randall M. Chesler, CEO
    (406) 751-4722
    Ron J. Copher, CFO
    (406) 751-7706
    Glacier Bancorp, Inc.
    Unaudited Condensed Consolidated Statements of Financial Condition
               
    (Dollars in thousands, except per share data) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
    Assets          
    Cash on hand and in banks $ 322,253     268,746     232,064  
    Interest bearing cash deposits   659,232     579,662     556,596  
    Cash and cash equivalents   981,485     848,408     788,660  
    Debt securities, available-for-sale   4,172,312     4,245,205     4,629,073  
    Debt securities, held-to-maturity   3,261,575     3,294,847     3,451,583  
    Total debt securities   7,433,887     7,540,052     8,080,656  
    Loans held for sale, at fair value   40,523     33,060     27,035  
    Loans receivable   17,218,518     17,261,849     16,732,502  
    Allowance for credit losses   (210,400 )   (206,041 )   (198,779 )
    Loans receivable, net   17,008,118     17,055,808     16,533,723  
    Premises and equipment, net   411,095     411,968     379,826  
    Right-of-use assets, net   54,441     56,252     63,447  
    Other real estate owned and foreclosed assets   1,153     1,164     891  
    Accrued interest receivable   103,992     99,262     106,063  
    Deferred tax asset   122,942     138,955     161,327  
    Intangibles, net   47,911     51,182     46,046  
    Goodwill   1,051,318     1,051,318     1,023,762  
    Non-marketable equity securities   88,134     99,669     111,129  
    Bank-owned life insurance   191,044     189,849     186,625  
    Other assets   322,836     326,040     312,980  
    Total assets $ 27,858,879     27,902,987     27,822,170  
    Liabilities          
    Non-interest bearing deposits $ 6,100,548     6,136,709     6,055,069  
    Interest bearing deposits   14,533,502     14,410,285     14,372,454  
    Securities sold under agreements to repurchase   1,849,070     1,777,475     1,540,008  
    FHLB advances   1,520,000     1,800,000     2,140,157  
    Other borrowed funds   82,443     83,341     88,814  
    Subordinated debentures   133,145     133,105     132,984  
    Accrued interest payable   30,231     33,626     32,584  
    Other liabilities   322,332     304,592     349,393  
    Total liabilities   24,571,271     24,679,133     24,711,463  
    Commitments and Contingent Liabilities            
    Stockholders’ Equity          
    Preferred shares, $0.01 par value per share, 1,000,000 shares authorized, none issued or outstanding            
    Common stock, $0.01 par value per share, 234,000,000 shares authorized   1,135     1,134     1,134  
    Paid-in capital   2,449,311     2,448,758     2,443,584  
    Retained earnings – substantially restricted   1,100,273     1,083,258     1,038,294  
    Accumulated other comprehensive loss   (263,111 )   (309,296 )   (372,305 )
    Total stockholders’ equity   3,287,608     3,223,854     3,110,707  
    Total liabilities and stockholders’ equity $ 27,858,879     27,902,987     27,822,170  
                       
    Glacier Bancorp, Inc.
    Unaudited Condensed Consolidated Statements of Operations
     
      Three Months ended
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
    Interest Income          
    Investment securities $ 45,646   50,381   56,218
    Residential real estate loans   24,275   23,960   20,764
    Commercial loans   197,388   199,260   181,472
    Consumer and other loans   22,616   23,435   20,948
    Total interest income   289,925   297,036   279,402
    Interest Expense          
    Deposits   62,865   67,079   67,196
    Securities sold under agreements to repurchase   13,733   14,822   12,598
    Federal Home Loan Bank advances   20,719   21,848   4,249
    FRB Bank Term Funding       27,097
    Other borrowed funds   402   348   344
    Subordinated debentures   2,227   1,496   1,438
    Total interest expense   99,946   105,593   112,922
    Net Interest Income   189,979   191,443   166,480
    Provision for credit losses   7,814   8,534   8,249
    Net interest income after provision for credit losses   182,165   182,909   158,231
    Non-Interest Income          
    Service charges and other fees   18,818   20,322   18,563
    Miscellaneous loan fees and charges   4,664   4,541   4,362
    Gain on sale of loans   4,311   3,926   3,362
    Gain on sale of securities       16
    Other income   4,849   2,760   3,686
    Total non-interest income   32,642   31,549   29,989
    Non-Interest Expense          
    Compensation and employee benefits   91,443   81,600   85,789
    Occupancy and equipment   12,294   11,589   11,883
    Advertising and promotions   4,144   3,725   3,983
    Data processing   9,138   9,145   9,159
    Other real estate owned and foreclosed assets   63   30   25
    Regulatory assessments and insurance   5,534   5,890   7,761
    Intangibles amortization   3,270   3,613   2,760
    Other expenses   25,432   25,373   30,483
    Total non-interest expense   151,318   140,965   151,843
    Income Before Income Taxes   63,489   73,493   36,377
    Federal and state income tax expense   8,921   11,739   3,750
    Net Income $ 54,568   61,754   32,627
                 
    Glacier Bancorp, Inc.
    Average Balance Sheets
       
      Three Months ended
      March 31, 2025   December 31, 2024
    (Dollars in thousands) Average
    Balance
      Interest &
    Dividends
      Average
    Yield/
    Rate
      Average
    Balance
      Interest &
    Dividends
      Average
    Yield/
    Rate
    Assets                      
    Residential real estate loans $ 1,885,497   $ 24,275   5.15 %   $ 1,885,146   $ 23,960   5.08 %
    Commercial loans 1   14,091,210     198,921   5.73 %     14,059,864     200,956   5.69 %
    Consumer and other loans   1,302,687     22,616   7.04 %     1,324,341     23,435   7.04 %
    Total loans 2   17,279,394     245,812   5.77 %     17,269,351     248,351   5.72 %
    Tax-exempt debt securities 3   1,604,851     13,936   3.47 %     1,615,474     14,501   3.59 %
    Taxable debt securities 4, 5   6,946,562     33,598   1.93 %     7,314,265     38,189   2.09 %
    Total earning assets   25,830,807     293,346   4.61 %     26,199,090     301,041   4.57 %
    Goodwill and intangibles   1,100,801             1,104,362        
    Non-earning assets   847,855             888,404        
    Total assets $ 27,779,463           $ 28,191,856        
    Liabilities                      
    Non-interest bearing deposits $ 5,989,490   $   %   $ 6,343,443   $   %
    NOW and DDA accounts   5,525,976     15,065   1.11 %     5,491,451     15,768   1.14 %
    Savings accounts   2,861,675     5,159   0.73 %     2,824,126     5,316   0.75 %
    Money market deposit accounts   2,849,470     13,526   1.93 %     2,878,415     14,232   1.97 %
    Certificate accounts   3,152,198     29,075   3.74 %     3,174,923     31,716   3.97 %
    Total core deposits   20,378,809     62,825   1.25 %     20,712,358     67,032   1.29 %
    Wholesale deposits 6   3,600     40   4.53 %     3,654     47   4.95 %
    Repurchase agreements   1,842,773     13,733   3.02 %     1,866,705     14,821   3.16 %
    FHLB advances   1,744,000     20,719   4.75 %     1,800,000     21,848   4.75 %
    Subordinated debentures and other borrowed funds   216,073     2,629   4.94 %     216,874     1,845   3.38 %
    Total funding liabilities   24,185,255     99,946   1.68 %     24,599,591     105,593   1.71 %
    Other liabilities   326,764             369,700        
    Total liabilities   24,512,019             24,969,291        
    Stockholders’ Equity                      
    Stockholders’ equity   3,267,444             3,222,565        
    Total liabilities and stockholders’ equity $ 27,779,463           $ 28,191,856        
    Net interest income (tax-equivalent)     $ 193,400           $ 195,448    
    Net interest spread (tax-equivalent)         2.93 %           2.86 %
    Net interest margin (tax-equivalent)         3.04 %           2.97 %

    ______________________________

    1 Includes tax effect of $1.5 million and $1.7 million on tax-exempt municipal loan and lease income for the three months ended March 31, 2025 and December 31, 2024, respectively.
    2 Total loans are gross of the allowance for credit losses, net of unearned income and include loans held for sale. Non-accrual loans were included in the average volume for the entire period.
    3 Includes tax effect of $1.7 million and $2.1 million on tax-exempt debt securities income for the three months ended March 31, 2025 and December 31, 2024, respectively.
    4 Includes interest income of $6.1 million and $9.2 million on average interest-bearing cash balances of $559.5 million and $759.7 million for the three months ended March 31, 2025 and December 31, 2024, respectively.
    5 Includes tax effect of $150 thousand and $203 thousand on federal income tax credits for the three months ended March 31, 2025 and December 31, 2024, respectively.
    6 Wholesale deposits include brokered deposits classified as NOW, DDA, money market deposit and certificate accounts with contractual maturities.
       
    Glacier Bancorp, Inc.
    Average Balance Sheets (continued)
       
      Three Months ended
      March 31, 2025   March 31, 2024
    (Dollars in thousands) Average
    Balance
      Interest &
    Dividends
      Average
    Yield/
    Rate
      Average
    Balance
      Interest &
    Dividends
      Average
    Yield/
    Rate
    Assets                      
    Residential real estate loans $ 1,885,497   $ 24,275   5.15 %   $ 1,747,184   $ 20,764   4.75 %
    Commercial loans 1   14,091,210     198,921   5.73 %     13,513,426     183,045   5.45 %
    Consumer and other loans   1,302,687     22,616   7.04 %     1,283,388     20,948   6.56 %
    Total loans 2   17,279,394     245,812   5.77 %     16,543,998     224,757   5.46 %
    Tax-exempt debt securities 3   1,604,851     13,936   3.47 %     1,720,370     15,157   3.52 %
    Taxable debt securities 4, 5   6,946,562     33,598   1.93 %     8,176,974     43,477   2.13 %
    Total earning assets   25,830,807     293,346   4.61 %     26,441,342     283,391   4.31 %
    Goodwill and intangibles   1,100,801             1,051,954        
    Non-earning assets   847,855             611,550        
    Total assets $ 27,779,463           $ 28,104,846        
    Liabilities                      
    Non-interest bearing deposits $ 5,989,490   $   %   $ 5,966,546   $   %
    NOW and DDA accounts   5,525,976     15,065   1.11 %     5,275,703     15,918   1.21 %
    Savings accounts   2,861,675     5,159   0.73 %     2,900,649     5,655   0.78 %
    Money market deposit accounts   2,849,470     13,526   1.93 %     2,948,294     14,393   1.96 %
    Certificate accounts   3,152,198     29,075   3.74 %     3,000,713     31,175   4.18 %
    Total core deposits   20,378,809     62,825   1.25 %     20,091,905     67,141   1.34 %
    Wholesale deposits 6   3,600     40   4.53 %     3,965     55   5.50 %
    Repurchase agreements   1,842,773     13,733   3.02 %     1,513,397     12,598   3.35 %
    FHLB advances   1,744,000     20,719   4.75 %     350,754     4,249   4.79 %
    FRB Bank Term Funding         %     2,483,077     27,097   4.39 %
    Subordinated debentures and other borrowed funds   216,073     2,629   4.94 %     218,271     1,782   3.28 %
    Total funding liabilities   24,185,255     99,946   1.68 %     24,661,369     112,922   1.84 %
    Other liabilities   326,764             356,554        
    Total liabilities   24,512,019             25,017,923        
    Stockholders’ Equity                      
    Stockholders’ equity   3,267,444             3,086,923        
    Total liabilities and stockholders’ equity $ 27,779,463           $ 28,104,846        
    Net interest income (tax-equivalent)     $ 193,400           $ 170,469    
    Net interest spread (tax-equivalent)         2.93 %           2.47 %
    Net interest margin (tax-equivalent)         3.04 %           2.59 %

    ______________________________

    1 Includes tax effect of $1.5 million and $1.6 million on tax-exempt municipal loan and lease income for the three months ended March 31, 2025 and 2024, respectively.
    2 Total loans are gross of the allowance for credit losses, net of unearned income and include loans held for sale. Non-accrual loans were included in the average volume for the entire period.
    3 Includes tax effect of $1.7 million and $2.2 million on tax-exempt debt securities income for the three months ended March 31, 2025 and 2024, respectively.
    4 Includes interest income of $6.1 million and $15.3 million on average interest-bearing cash balances of $559.5 million and $1.12 billion for the three months ended March 31, 2025 and 2024, respectively.
    5 Includes tax effect of $150 thousand and $215 thousand on federal income tax credits for the three months ended March 31, 2025 and 2024, respectively.
    6 Wholesale deposits include brokered deposits classified as NOW, DDA, money market deposit and certificate accounts with contractual maturities.
       

    Glacier Bancorp, Inc.
    Loan Portfolio by Regulatory Classification

      Loans Receivable, by Loan Type   % Change from
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Dec 31,
    2024
      Mar 31,
    2024
    Custom and owner occupied construction $ 233,584     $ 242,844     $ 273,835     (4)%   (15)%
    Pre-sold and spec construction   200,921       191,926       223,294     5 %   (10)%
    Total residential construction   434,505       434,770       497,129     %   (13)%
    Land development   177,448       197,369       215,828     (10)%   (18)%
    Consumer land or lots   197,553       187,024       188,635     6 %   5 %
    Unimproved land   115,528       113,532       103,032     2 %   12 %
    Developed lots for operative builders   64,782       61,661       47,591     5 %   36 %
    Commercial lots   95,574       99,243       92,748     (4)%   3 %
    Other construction   714,151       693,461       915,782     3 %   (22)%
    Total land, lot, and other construction   1,365,036       1,352,290       1,563,616     1 %   (13)%
    Owner occupied   3,182,589       3,197,138       3,057,348     %   4 %
    Non-owner occupied   4,054,107       4,053,996       3,920,696     %   3 %
    Total commercial real estate   7,236,696       7,251,134       6,978,044     %   4 %
    Commercial and industrial   1,392,365       1,395,997       1,371,201     %   2 %
    Agriculture   1,016,081       1,024,520       929,420     (1)%   9 %
    First lien   2,499,494       2,481,918       2,276,638     1 %   10 %
    Junior lien   85,343       76,303       51,579     12 %   65 %
    Total 1-4 family   2,584,837       2,558,221       2,328,217     1 %   11 %
    Multifamily residential   874,071       895,242       881,117     (2)%   (1)%
    Home equity lines of credit   989,043       1,005,783       947,652     (2)%   4 %
    Other consumer   188,388       209,457       223,566     (10)%   (16)%
    Total consumer   1,177,431       1,215,240       1,171,218     (3)%   1 %
    States and political subdivisions   1,001,058       983,601       848,454     2 %   18 %
    Other   176,961       183,894       191,121     (4)%   (7)%
    Total loans receivable, including loans held for sale   17,259,041       17,294,909       16,759,537     %   3 %
    Less loans held for sale 1   (40,523 )     (33,060 )     (27,035 )   23 %   50 %
    Total loans receivable $ 17,218,518     $ 17,261,849     $ 16,732,502     %   3 %

    ______________________________

    1 Loans held for sale are primarily first lien 1-4 family loans.
       
    Glacier Bancorp, Inc.
    Credit Quality Summary by Regulatory Classification
                   
       

    Non-performing Assets, by Loan Type

      Non-
    Accrual
    Loans
      Accruing
    Loans 90
    Days
    or More Past
    Due
      Other real estate
    owned and foreclosed assets
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Mar 31,
    2025
      Mar 31,
    2025
      Mar 31,
    2025
    Custom and owner occupied construction $ 194   198   210   194    
    Pre-sold and spec construction   2,896   2,132   1,049   2,133   763  
    Total residential construction   3,090   2,330   1,259   2,327   763  
    Land development   935   966   28   935    
    Consumer land or lots   173   78   144   173    
    Developed lots for operative builders   531   531   608     531  
    Commercial lots   47   47   2,205     47  
    Total land, lot and other construction   1,686   1,622   2,985   1,108   578  
    Owner occupied   3,601   2,979   1,501   3,073   96   432
    Non-owner occupied   2,235   2,235   8,853   1,582     653
    Total commercial real estate   5,836   5,214   10,354   4,655   96   1,085
    Commercial and Industrial   12,367   2,069   1,698   11,640   727  
    Agriculture   2,382   2,335   2,855   2,090   292  
    First lien   8,752   9,053   2,930   6,796   1,956  
    Junior lien   296   315   69   296    
    Total 1-4 family   9,048   9,368   2,999   7,092   1,956  
    Multifamily residential   400   389   395   400    
    Home equity lines of credit   3,479   3,465   1,892   2,726   753  
    Other consumer   1,003   955   927   858   77   68
    Total consumer   4,482   4,420   2,819   3,584   830   68
    Other   47   39   61     47  
    Total $ 39,338   27,786   25,425   32,896   5,289   1,153
                             

    Glacier Bancorp, Inc.
    Credit Quality Summary by Regulatory Classification (continued)

      Accruing 30-89 Days Delinquent Loans,  by Loan Type   % Change from
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Dec 31,
    2024
      Mar 31,
    2024
    Custom and owner occupied construction $ 786   $ 969   $ 4,784   (19)%   (84)%
    Pre-sold and spec construction       564     1,181   (100)%   (100)%
    Total residential construction   786     1,533     5,965   (49)%   (87)%
    Land development       1,450     59   (100)%   (100)%
    Consumer land or lots   1,026     402     332   155 %   209 %
    Unimproved land   32     36     575   (11)%   (94)%
    Developed lots for operative builders       214       (100)%   n/m
    Commercial lots   189         1,225   n/m   (85)%
    Other construction           1,248   n/m   (100)%
    Total land, lot and other construction   1,247     2,102     3,439   (41)%   (64)%
    Owner occupied   3,786     2,867     2,991   32 %   27 %
    Non-owner occupied   346     5,037     18,118   (93)%   (98)%
    Total commercial real estate   4,132     7,904     21,109   (48)%   (80)%
    Commercial and industrial   5,358     6,194     14,806   (13)%   (64)%
    Agriculture   5,731     744     3,922   670 %   46 %
    First lien   14,826     6,326     5,626   134 %   164 %
    Junior lien   1,023     214     145   378 %   606 %
    Total 1-4 family   15,849     6,540     5,771   142 %   175 %
    Home equity lines of credit   6,993     3,731     3,668   87 %   91 %
    Other consumer   1,824     1,775     1,948   3 %   (6)%
    Total consumer   8,817     5,506     5,616   60 %   57 %
    States and political subdivisions   3,220           n/m   n/m
    Other   1,318     1,705     1,795   (23)%   (27)%
    Total $ 46,458   $ 32,228   $ 62,423   44 %   (26)%

    ______________________________

    n/m – not measurable

    Glacier Bancorp, Inc.
    Credit Quality Summary by Regulatory Classification (continued)
               
      Net Charge-Offs (Recoveries), Year-to-Date
    Period Ending, By Loan Type
      Charge-Offs   Recoveries
    (Dollars in thousands) Mar 31,
    2025
      Dec 31,
    2024
      Mar 31,
    2024
      Mar 31,
    2025
      Mar 31,
    2025
    Pre-sold and spec construction $     (4 )   (4 )    
    Pre-sold and spec construction $     (4 )   (4 )    
    Land development   (341 )   1,095     (1 )     341
    Consumer land or lots   (3 )   (22 )   (1 )     3
    Unimproved land       1,338          
    Commercial lots       319          
    Total land, lot and other construction   (344 )   2,730     (2 )     344
    Owner occupied   (1 )   (73 )   (3 )     1
    Non-owner occupied   (6 )   2     (1 )     6
    Total commercial real estate   (7 )   (71 )   (4 )     7
    Commercial and industrial   92     1,422     328     421   329
    Agriculture   (1 )   64     68       1
    First lien   (69 )   32     (4 )     69
    Junior lien   (5 )   (65 )   (5 )     5
    Total 1-4 family   (74 )   (33 )   (9 )     74
    Home equity lines of credit   (20 )   69     5       20
    Other consumer   276     1,078     251     331   55
    Total consumer   256     1,147     256     331   75
    Other   1,873     8,643     2,439     3,145   1,272
    Total $ 1,795     13,898     3,072     3,897   2,102
                               

    Visit our website at www.glacierbancorp.com 

    The MIL Network

  • MIL-OSI: Heritage Commerce Corp Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    SAN JOSE, Calif., April 24, 2025 (GLOBE NEWSWIRE) — Heritage Commerce Corp (Nasdaq: HTBK), (the “Company”), the holding company for Heritage Bank of Commerce (the “Bank”) today announced its financial results for the first quarter of 2025. All data are unaudited.

    QUARTERLY HIGHLIGHTS:

    Net Income Earnings Per Share Pre-Provision Net
    Revenue (“PPNR”)
    (1)
    Fully Tax Equivalent
    (“FTE”) Net Interest
    Margin(1)
    Efficiency Ratio(1) Tangible Book Value
    Per Share
    (1)
               
    $11.6 million $0.19 $16.6 million 3.39% 63.96% $8.48
               


    CEO COMMENTARY:

    “We delivered a solid quarter of performance with a 9% increase in our level of profitability from the prior quarter,” said Clay Jones, President and Chief Executive Officer. “While our balance sheet trends reflected the seasonally low loan demand and deposit outflows in the first quarter, we generated a higher level of profitability due to improved net interest margin, strong expense control, and an improvement in our asset quality. We also redeployed some of our excess liquidity to purchase new investment securities, which we expect will have a positive impact on our net interest income and net interest margin going forward. Our longer-term trends remain positive as well, with notable improvement in many areas compared to the first quarter of last year, including a 14% increase in net income and increases in the annualized returns on average assets and average equity.”

    “While economic uncertainty has increased over the past few months, we still expect to deliver solid financial performance in 2025 as we continue to capitalize on our market position to assist new clients that have been impacted by dislocation and disruption in our markets resulting from bank failures and acquisitions. We believe that we will continue to see positive trends in areas such as net interest margin, loan and deposit growth, and expense management, which should lead to strong financial performance for our shareholders as we move through the year,” said Mr. Jones.

    LINKED-QUARTER BASIS YEAR-OVER-YEAR
    FINANCIAL HIGHLIGHTS:
     
    • Net income of $11.6 million and earnings per share of $0.19, up 9% and 12%, from $10.6 million and $0.17, respectively
    • Total revenue of $46.1 million, a decrease of 1%, or $314,000, compared to a decrease in noninterest expense of 3%, or $848,000
    • PPNR(1) of $16.6 million, up $534,000 from $16.1 million
    • Effective tax rate of 28.8%, compared to 27.9%
    • Net income of $11.6 million and earnings per share of $0.19, up 14% and 12%, from $10.2 million and $0.17, respectively
    • Total revenue of $46.1 million, an increase of 9%, or $3.9 million, compared to an increase in noninterest expense of 7%, or $1.9 million
    • PPNR(1) of $16.6 million, up $2.0 million from $14.6 million
    • Effective tax rate of 28.8%, compared to 29.5%
    FINANCIAL CONDITION:  
    • Loans held-for-investment (“HFI”) remained relatively flat at $3.5 billion
    • Total deposits of $4.7 billion, down $136.8 million, or 3%
    • Loan to deposit ratio of 74.45%, up from 72.45%
    • Total shareholders’ equity of $696 million, up $6.5 million
    • Increase in loans HFI of $150.8 million, or 5%
    • Increase in total deposits of $238.6 million, or 5%
    • Loan to deposit ratio of 74.45%, down from 75.06%
    • Increase in total shareholders’ equity of $19.9 million
    CREDIT QUALITY:  
    • Nonperforming assets (“NPAs”) to total assets of 0.11%, compared to 0.14%
    • Classified assets to total assets of 0.73%, compared to 0.74%
    • NPAs to total assets of 0.11%, compared to 0.15%
    • Classified assets to total assets of 0.73%, compared to 0.67%
    KEY PERFORMANCE METRICS:  
    • FTE net interest margin(1) of 3.39%, an increase from 3.32%
    • Return on average tangible assets(1) and on tangible common equity(1) of 0.88% and 9.09%, compared to 0.78% and 8.25%, respectively
    • Efficiency ratio(1) of 63.96%, compared to 65.35%
    • Common equity tier 1 capital ratio of 13.6%, compared to 13.4%
    • Total capital ratio of 15.9%, compared to 15.6%
    • Tangible common equity ratio(1) of 9.78%, an increase of 4% from 9.43%
    • Tangible book value per share(1) of $8.48, compared to $8.41
    • FTE net interest margin(1) of 3.39%, an increase from 3.31%
    • Return on average tangible assets(1) and on tangible common equity(1) of 0.88% and 9.09%, compared to 0.82% and 8.24%, respectively
    • Efficiency ratio(1) of 63.96%, compared to 65.34%
    • Common equity tier 1 capital ratio of 13.6%, compared to 13.4%
    • Total capital ratio of 15.9%, compared to 15.6%
    • Tangible common equity ratio(1) of 9.78%, a decrease of 1% from 9.85%
    • Tangible book value per share(1) of $8.48, compared to $8.17
       

    (1)This is a non-GAAP financial measure as defined and discussed under “Non-GAAP Financial Measures” later in this press release.

    Results of Operations:

    Net interest income totaled $43.4 million for the first quarter of 2025, a slight decrease of $235,000, or 1%, compared to $43.6 million for the fourth quarter of 2024. The decrease was primarily due to two fewer accrual days during the quarter from the prior linked quarter, together with a lower average balance on interest earning assets, which was largely offset by a decrease in rates paid on deposits and a decrease of higher cost deposit balances. Net interest income increased $3.9 million, or 10%, compared to $39.5 million for the first quarter of 2024. The increase was primarily due to growth in average earning asset balances, partially offset by an increase in interest-bearing deposit balances.

    The FTE net interest margin(1) was 3.39% for the first quarter of 2025, an increase over 3.32% for the fourth quarter of 2024 primarily due to lower rates paid on customer deposits, an increase in the average balances of securities and loans, and higher average yields on securities, partially offset by a decrease in the average balance of noninterest-bearing demand deposits and a lower average yield on overnight funds. The FTE net interest margin(1) increased from 3.31% for the first quarter of 2024 primarily due to lower rates paid on customer deposits, an increase in the average balances of loans, and higher average yields on securities and loans, and an increase in the average balance of deposits resulting in a higher average balance of overnight funds, partially offset by a lower average yield on overnight funds.

    We recorded a provision for credit losses on loans of $274,000 for the first quarter of 2025, compared to a $1.3 million provision for credit losses on loans for the fourth quarter of 2024, and a $184,000 provision for credit losses on loans for the first quarter of 2024.

    Total noninterest income remained relatively flat at $2.7 million for the first quarter of 2025, compared to $2.8 million for the fourth quarter of 2024, and $2.6 million for the first quarter of 2024.

    Total revenue, which is defined as net interest income before provision for credit losses on loans plus noninterest income, decreased $314,000, or 1%, to $46.1 million for the first quarter of 2025, compared to $46.4 million for the fourth quarter of 2024, and increased $3.9 million, or 9%, from $42.1 million for the first quarter of 2024.

    Total noninterest expense for the first quarter of 2025 decreased to $29.5 million, compared to $30.3 million for the fourth quarter of 2024, primarily due to nonrecurring personnel related expenses and legal fees of approximately $1.1 million, and higher professional fees and homeowner association vendor payments during the fourth quarter of 2024. Total noninterest expense increased compared to $27.5 million for the first quarter of 2024, primarily due to higher salaries and employee benefits, professional fees, and information technology related expenses.

    Income tax expense was $4.7 million for the first quarter of 2025, compared to $4.1 million for the fourth quarter of 2024, and $4.3 million for the first quarter of 2024. The effective tax rate for the first quarter of 2025 was 28.8%, compared to 27.9% for the fourth quarter of 2024, and 29.5% for the first quarter of 2024.

    Net income was $11.6 million, or $0.19 per average diluted common share, for the first quarter of 2025, compared to $10.6 million, or $0.17 per average diluted common share, for the fourth quarter of 2024, and $10.2 million, or $0.17 per average diluted common share, for the first quarter of 2024.

    For the first quarter of 2025, the Company’s PPNR(1), which is defined as total revenue less noninterest expense, was $16.6 million, compared to $16.1 million for the fourth quarter of 2024, and $14.6 million for the first quarter of 2024.

    The efficiency ratio(1) improved to 63.96% for the first quarter of 2025, compared to 65.35% for the fourth quarter of 2024, as a result of lower noninterest expense, partially offset by lower total revenue. The efficiency ratio(1) improved from 65.34% for the first quarter of 2024, primarily due to higher total revenue, partially offset by higher noninterest expense during the first quarter of 2025.

    Full time equivalent employees were 350 at March 31, 2025 compared to 355 at December 31, 2024, and 351 at March 31, 2024.

    (1)This is a non-GAAP financial measure as defined and discussed under “Non-GAAP Financial Measures” later in this press release.

    Financial Condition and Capital Management:

    Total assets decreased 2% to $5.5 billion at March 31, 2025, compared to $5.6 billion at December 31, 2024, primarily due to a decrease in deposits resulting in a decrease in overnight funds. Total assets increased 5% from $5.3 billion at March 31, 2024, primarily due to an increase in deposits resulting in an increase in overnight funds, and an increase in loans.

    Investment securities available-for-sale (at fair value) totaled $371.0 million at March 31, 2025, compared to $256.3 million at December 31, 2024, and $404.5 million at March 31, 2024. The pre-tax unrealized loss on the securities available-for-sale portfolio was $3.1 million, or $2.3 million net of taxes, which equaled less than 1% of total shareholders’ equity at March 31, 2025.

    During the first quarter of 2025, the Company purchased $62.3 million of agency mortgage-backed securities, $44.8 million of collateralized mortgage obligations, and $44.7 million of U.S. Treasury securities, for total purchases of $151.8 million in the available-for-sale portfolio. Securities purchased had a book yield of 4.86% and an average life of 4.34 years.

    Investment securities held-to-maturity (at amortized cost, net of allowance for credit losses of $12,000), totaled $576.7 million at March 31, 2025, compared to $590.0 million at December 31, 2024, and $636.2 million at March 31, 2024. The fair value of the securities held-to-maturity portfolio was $496.3 million at March 31, 2025. The pre-tax unrecognized loss on the securities held-to-maturity portfolio was $80.5 million, or $56.7 million net of taxes, which equaled 8.1% of total shareholders’ equity at March 31, 2025.

    The unrealized and unrecognized losses in both the available-for-sale and held-to-maturity portfolios were due to higher interest rates at March 31, 2025 compared to when the securities were purchased. The issuers are of high credit quality and all principal amounts are expected to be repaid when the securities mature. The fair value is expected to recover as the securities approach their maturity date and/or market rates decline.

    Loans HFI, net of deferred costs and fees, remained flat at $3.5 billion at March 31, 2025 as compared to December 31, 2024, and increased $150.8 million, or 5%, from $3.3 billion at March 31, 2024. Loans HFI, excluding residential mortgages, remained flat at $3.0 billion at March 31, 2025 as compared to December 31, 2024, and increased $175.5 million, or 6%, from $2.8 billion at March 31, 2024.

    Commercial and industrial line utilization was 31% at March 31, 2025, compared to 34% at December 31, 2024, and 28% at March 31, 2024. Commercial real estate (“CRE”) loans totaled $2.0 billion at March 31, 2025, of which 31% were owner occupied and 69% were investor CRE loans. Owner occupied CRE loans totaled 31% at December 31, 2024 and 32% at March 31, 2024. At March 31, 2025, approximately 24% of the Company’s loan portfolio consisted of floating interest rate loans, compared to 26% at both December 31, 2024 and March 31, 2024.

    At March 31, 2025, paydowns and maturities of investment securities and fixed interest rate loans maturing within one year totaled $395.6 million.

    Total deposits decreased $136.8 million, or 3%, to $4.7 billion at March 31, 2025, compared to $4.8 billion at December 31, 2024 due to deposits outflows we typically see in the first quarter, and increased $238.6 million, or 5% from $4.4 billion at March 31, 2024.

    The following table shows the Company’s deposit types as a percentage of total deposits at the dates indicated:

                       
        March 31,     December 31,     March 31,  
    DEPOSITS TYPE % TO TOTAL DEPOSITS   2025     2024     2024  
    Demand, noninterest-bearing   24 %   25 %   28 %
    Demand, interest-bearing   20 %   19 %   21 %
    Savings and money market   29 %   28 %   25 %
    Time deposits — under $250   1 %   1 %   1 %
    Time deposits — $250 and over   5 %   4 %   4 %
    ICS/CDARS — interest-bearing demand,                  
    money market and time deposits   21 %   23 %   21 %
    Total deposits   100 %   100 %   100 %
                       

    The loan to deposit ratio was 74.45% at March 31, 2025, compared to 72.45% at December 31, 2024, and 75.06% at March 31, 2024.

    The Company’s total available liquidity and borrowing capacity was $3.2 billion at March 31, 2025, compared to $3.3 billion at December 31, 2024, and $3.0 billion at March 31, 2024.

    Total shareholders’ equity was $696.2 million at March 31, 2025, compared to $689.7 million at December 31, 2024, and $676.3 million at March 31, 2024. The increase in shareholders’ equity at March 31, 2025 is primarily a function of net income and the decrease in the total accumulated other comprehensive loss, partially offset by dividends to stockholders.

    Total accumulated other comprehensive loss of $6.8 million at March 31, 2025 was comprised of unrealized losses on securities available-for-sale of $2.3 million, a split dollar insurance contracts liability of $2.4 million, a supplemental executive retirement plan liability of $2.2 million, and a $49,000 unrealized gain on interest-only strip from SBA loans.

    The Company’s consolidated capital ratios exceeded regulatory guidelines and the Bank’s capital ratios exceeded regulatory guidelines under the prompt corrective action (“PCA”) regulatory guidelines for a well-capitalized financial institution, and the Basel III minimum regulatory requirements at March 31, 2025.

    Tangible book value per share(1) was $8.48 at March 31, 2025, compared to $8.41 at December 31, 2024, and $8.17 at March 31, 2024.

    In July 2024, the Company announced that its Board of Directors adopted a share repurchase program under which the Company is authorized to repurchase up to $15 million of the Company’s shares of its issued and outstanding common stock. The Company did not repurchase any of its common stock during 2024 or the first quarter of 2025.

    (1)This is a non-GAAP financial measure as defined and discussed under “Non-GAAP Financial Measures” later in this press release.

    Credit Quality:

    The provision for credit losses on loans totaled $274,000 for the first quarter of 2025, compared to a $1.3 million provision for credit losses on loans for the fourth quarter of 2024, and a provision for credit losses on loans of $184,000 for the first quarter of 2024. Net charge-offs totaled $965,000 for the first quarter of 2025, compared to $197,000 for the fourth quarter of 2024, and $254,000 for the first quarter of 2024. More than half of the net charge-offs for the first quarter of 2025 related to one commercial contractor that was previously reserved for during the fourth quarter of 2024. The remaining charge-offs were related to five different small businesses in a variety of industries. Four loans were underwritten using a scored small business product whose underwriting guidelines have been tightened since the loans were made. 

    The allowance for credit losses on loans (“ACLL”) at March 31, 2025 was $48.3 million, or 1.38% of total loans, representing 765% of total nonperforming loans. The ACLL at December 31, 2024 was $49.0 million, or 1.40% of total loans, representing 638% of total nonperforming loans. The ACLL at March 31, 2024 was $47.9 million, or 1.44% of total loans, representing 608% of total nonperforming loans. The reduction to the allowance for credit on losses on loans reflects our credit assessment and economic factors.

    NPAs were $6.3 million at March 31, 2025, compared to $7.7 million at December 31, 2024, and $7.9 million at March 31, 2024. There were no CRE loans in NPAs at March 31, 2025, December 31, 2024, or March 31, 2024. There were no foreclosed assets on the balance sheet at March 31, 2025, December 31, 2024, or March 31, 2024. There were no Shared National Credits (“SNCs”) or material purchased participations included in NPAs or total loans at March 31, 2025, December 31, 2024, or March 31, 2024.

    Classified assets totaled $40.0 million, or 0.73% of total assets, at March 31, 2025, compared to $41.7 million, or 0.74% of total assets, at December 31, 2024, and $35.4 million, or 0.67% of total assets, at March 31, 2024. The increase in classified assets from March 31, 2024 was primarily the result of one downgraded owner occupied CRE credit, and a number of residential related loans downgraded during the fourth quarter of 2024. The loans are well-collateralized and we do not anticipate to incur losses as a result of the downgrades of these loans.

    Heritage Commerce Corp, a bank holding company established in October 1997, is the parent company of Heritage Bank of Commerce, established in 1994 and headquartered in San Jose, CA with full-service branches in Danville, Fremont, Gilroy, Hollister, Livermore, Los Altos, Los Gatos, Morgan Hill, Oakland, Palo Alto, Pleasanton, Redwood City, San Francisco, San Jose, San Mateo, San Rafael, and Walnut Creek. Heritage Bank of Commerce is an SBA Preferred Lender. Bay View Funding, a subsidiary of Heritage Bank of Commerce, is based in San Jose, CA and provides business-essential working capital factoring financing to various industries throughout the United States. For more information, please visit www.heritagecommercecorp.com. The contents of our website are not incorporated into, and do not form a part of, this release or of our filings with the Securities and Exchange Commission.

    Reclassifications

    During the first quarter of 2025, we reclassified Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank (“FRB”) stock dividends from interest income to noninterest income and the related average asset balances were reclassified from interest earning assets to other assets on the “Net Interest Income and Net Interest Margin” tables. The amounts for the prior periods were reclassified to conform to the current presentation. These reclassifications did not affect previously reported net income or shareholders’ equity.

    Non-GAAP Financial Measures

    Financial results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and prevailing practices in the banking industry. However, certain non-GAAP performance measures and ratios are used by management to evaluate and measure the Company’s performance. Management believes these non-GAAP financial measures are common in the banking industry, and may enhance comparability for peer comparison purposes. These non-GAAP financial measures should be supplemental to primary GAAP financial measures and should not be read in isolation or relied upon as a substitute for primary GAAP financial measures. A reconciliation of GAAP to non-GAAP financial measures is presented in the tables at the end of this press release under “Reconciliation of Non-GAAP Financial Measures.”

    Forward-Looking Statement Disclaimer

    Certain matters discussed in this press release constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are inherently uncertain in that they reflect plans and expectations for future events. These statements may include, among other things, those relating to the Company’s future financial performance, plans and objectives regarding future events, expectations regarding changes in interest rates and market conditions, projected cash flows of our investment securities portfolio, the performance of our loan portfolio, estimated net interest income resulting from a shift in interest rates, expectation of high credit quality issuers ability to repay, as well as statements relating to the anticipated effects on the Company’s financial condition and results of operations from expected developments or events. Any statements that reflect our belief about, confidence in, or expectations for future events, performance or condition should be considered forward-looking statements. Readers should not construe these statements as assurances of a given level of performance, nor as promises that we will take actions that we currently expect to take. All statements are subject to various risks and uncertainties, many of which are outside our control and some of which may fall outside our ability to predict or anticipate. Accordingly, our actual results may differ materially from our projected results, and we may take actions or experience events that we do not currently expect. Risks and uncertainties that could cause our financial performance to differ materially from our goals, plans, expectations and projections expressed in forward-looking statements include those set forth in our filings with the Securities and Exchange Commission, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and include: (i) risks of geographic concentration of our client base, our loans, and the collateral securing our loans, as those clients and assets may be particularly subject to natural disasters and to events and conditions that directly or indirectly affect those regions, including the particular risks of natural disasters (including earthquakes, fires, and flooding) and other events that disproportionately affect that region; (ii) cybersecurity risks that may affect us directly or may impact us indirectly by virtue of their effects on our clients, markets or vendors, including our ability to identify and address cybersecurity risks, including those posed by the increasing use of artificial intelligence, such as data security breaches, “denial of service” attacks, “hacking” and identity theft affecting us, our clients, and our third-party vendors and service providers; (iii) domestic, international and multinational political events that have accompanied or that may in the future accompany or result from recent political changes, particularly including sociopolitical events and conditions that result from political conflicts and law enforcement activities that may adversely affect our markets or our clients; (iv) media items and consumer confidence as those factors affect our clients’ confidence in the banking system generally and in our bank specifically; (v) adequacy of our risk management framework, disclosure controls and procedures and internal control over financial reporting; (vi) market, geographic and sociopolitical factors that arise by virtue of the fact that we operate primarily in the general San Francisco Bay Area of Northern California; (vii) the effects of recent wildfires affecting Southern California, which have affected certain clients and certain loans secured by mortgages in Los Angeles County, and which are affecting or may, in the future, affect other clients in those and other markets throughout California; (viii) factors that affect our liquidity and our ability to meet client demands for withdrawals from deposit accounts and undrawn lines of credit, including our cash on hand and the availability of funds from our own lines of credit; (ix) factors that affect the value and liquidity of our investment portfolios, particularly the values of securities available-for-sale; (x) our ability to estimate accurately, and to establish adequate reserves against, the risk of loss associated with our loan and lease portfolios and our factoring business; (xi) inflationary pressures and changes in the interest rate environment that reduce our margins and yields, the fair value of financial instruments or our level of loan originations, or increase the level of defaults, losses and prepayments on loans to clients, whether held in the portfolio or in the secondary market; (xii) increased capital requirements for our continual growth or as imposed by banking regulators, which may require us to raise capital at a time when capital is not available on favorable terms or at all; (xiii) operational issues stemming from, and/or capital spending necessitated by, the potential need to adapt to industry changes in information technology systems, on which we are highly dependent; (xiv) events that affect our ability to attract, recruit, and retain qualified officers and other personnel to implement our strategic plan, and that enable current and future personnel to protect and develop our relationships with clients, and to promote our business, results of operations and growth prospects; (xv) the expense and uncertain resolution of litigation matters whether occurring in the ordinary course of business or otherwise, particularly including but not limited to the effects of recent and ongoing developments in California labor and employment laws, regulations and court decisions; and (xvi) our success in managing the risks involved in the foregoing factors.

    Member FDIC

    For additional information, contact:
    Debbie Reuter
    EVP, Corporate Secretary
    Direct: (408) 494-4542
    Debbie.Reuter@herbank.com

                                 
        For the Quarter Ended:   Percent Change From:  
    CONSOLIDATED INCOME STATEMENTS      March 31,       December 31,       March 31,       December 31,       March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024    2024   
    Interest income   $ 61,832   $ 64,043   $ 56,960   (3 ) % 9   %
    Interest expense     18,472     20,448     17,458   (10 ) % 6   %
    Net interest income before provision                            
    for credit losses on loans     43,360     43,595     39,502   (1 ) % 10   %
    Provision for credit losses on loans     274     1,331     184   (79 ) % 49   %
    Net interest income after provision                            
    for credit losses on loans     43,086     42,264     39,318   2   % 10   %
    Noninterest income:                            
    Service charges and fees on deposit                            
    accounts     892     885     877   1   % 2   %
    FHLB and FRB stock dividends     590     590     591   0   % 0   %
    Increase in cash surrender value of                            
    life insurance     538     528     518   2   % 4   %
    Gain on sales of SBA loans     98     125     178   (22 ) % (45 ) %
    Servicing income     82     77     90   6   % (9 ) %
    Termination fees     87     18     13   383   % 569   %
    Other     409     552     371   (26 ) % 10   %
    Total noninterest income     2,696     2,775     2,638   (3 ) % 2   %
    Noninterest expense:                            
    Salaries and employee benefits     16,575     16,976     15,509   (2 ) % 7   %
    Occupancy and equipment     2,534     2,495     2,443   2   % 4   %
    Professional fees     1,580     1,711     1,327   (8 ) % 19   %
    Other     8,767     9,122     8,257   (4 ) % 6   %
    Total noninterest expense     29,456     30,304     27,536   (3 ) % 7   %
    Income before income taxes     16,326     14,735     14,420   11   % 13   %
    Income tax expense     4,700     4,114     4,254   14   % 10   %
    Net income   $ 11,626   $ 10,621   $ 10,166   9   % 14   %
                                 
    PER COMMON SHARE DATA                            
    (unaudited)                              
    Basic earnings per share   $ 0.19   $ 0.17   $ 0.17   12   % 12   %
    Diluted earnings per share   $ 0.19   $ 0.17   $ 0.17   12   % 12   %
    Weighted average shares outstanding – basic     61,479,579     61,320,505     61,186,623   0   % 0   %
    Weighted average shares outstanding – diluted     61,708,361     61,679,735     61,470,552   0   % 0   %
    Common shares outstanding at period-end     61,611,121     61,348,095     61,253,625   0   % 1   %
    Dividend per share   $ 0.13   $ 0.13   $ 0.13   0   % 0   %
    Book value per share   $ 11.30   $ 11.24   $ 11.04   1   % 2   %
    Tangible book value per share(1)   $ 8.48   $ 8.41   $ 8.17   1   % 4   %
                                 
    KEY PERFORMANCE METRICS                                 
    (in $000’s, unaudited)                                 
    Annualized return on average equity     6.81 %   6.16 %   6.08 % 11   % 12   %
    Annualized return on average tangible                            
    common equity(1)     9.09 %   8.25 %   8.24 % 10   % 10   %
    Annualized return on average assets     0.85 %   0.75 %   0.79 % 13   % 8   %
    Annualized return on average tangible assets(1)     0.88 %   0.78 %   0.82 % 13   % 7   %
    Net interest margin (FTE)(1)     3.39 %   3.32 %   3.31 % 2   % 2   %
    Total revenue   $ 46,056   $ 46,370   $ 42,140   (1 ) % 9   %
    Pre-provision net revenue(1)   $ 16,600   $ 16,066   $ 14,604   3   % 14   %
    Efficiency ratio(1)     63.96 %   65.35 %   65.34 % (2 ) % (2 ) %
                                 
    AVERAGE BALANCES                                
    (in $000’s, unaudited)                                 
    Average assets   $ 5,559,896   $ 5,607,840   $ 5,178,636   (1 ) % 7   %
    Average tangible assets(1)   $ 5,386,001   $ 5,433,439   $ 5,002,597   (1 ) % 8   %
    Average earning assets   $ 5,188,317   $ 5,235,986   $ 4,810,505   (1 ) % 8   %
    Average loans held-for-sale   $ 2,290   $ 2,260   $ 2,749   1   % (17 ) %
    Average loans held-for-investment   $ 3,429,014   $ 3,388,729   $ 3,297,240   1   % 4   %
    Average deposits   $ 4,717,517   $ 4,771,491   $ 4,360,150   (1 ) % 8   %
    Average demand deposits – noninterest-bearing   $ 1,167,330   $ 1,222,393   $ 1,177,078   (5 ) % (1 ) %
    Average interest-bearing deposits   $ 3,550,187   $ 3,549,098   $ 3,183,072   0   % 12   %
    Average interest-bearing liabilities   $ 3,589,872   $ 3,588,755   $ 3,222,603   0   % 11   %
    Average equity   $ 692,733   $ 686,263   $ 672,292   1   % 3   %
    Average tangible common equity(1)   $ 518,838   $ 511,862   $ 496,253   1   % 5   %
                                 

    (1)This is a non-GAAP financial measure as defined and discussed under Non-GAAP Financial Measures” in this press release.

                                     
        For the Quarter Ended:  
    CONSOLIDATED INCOME STATEMENTS      March 31,       December 31,       September 30,      June 30,       March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024   2024  
    Interest income   $ 61,832   $ 64,043   $ 60,852   $ 58,489   $ 56,960  
    Interest expense     18,472     20,448     21,523     19,622     17,458  
    Net interest income before provision                                
    for credit losses on loans     43,360     43,595     39,329     38,867     39,502  
    Provision for credit losses on loans     274     1,331     153     471     184  
    Net interest income after provision                                
    for credit losses on loans     43,086     42,264     39,176     38,396     39,318  
    Noninterest income:                                
    Service charges and fees on deposit                                
    accounts     892     885     908     891     877  
    FHLB and FRB stock dividends     590     590     586     588     591  
    Increase in cash surrender value of                                
    life insurance     538     528     530     521     518  
    Gain on sales of SBA loans     98     125     94     76     178  
    Servicing income     82     77     108     90     90  
    Termination fees     87     18     46     100     13  
    Gain on proceeds from company-owned                                
    life insurance                 219      
    Other     409     552     554     379     371  
    Total noninterest income     2,696     2,775     2,826     2,864     2,638  
    Noninterest expense:                                
    Salaries and employee benefits     16,575     16,976     15,673     15,794     15,509  
    Occupancy and equipment     2,534     2,495     2,599     2,689     2,443  
    Professional fees     1,580     1,711     1,306     1,072     1,327  
    Other     8,767     9,122     7,977     8,633     8,257  
    Total noninterest expense     29,456     30,304     27,555     28,188     27,536  
    Income before income taxes     16,326     14,735     14,447     13,072     14,420  
    Income tax expense     4,700     4,114     3,940     3,838     4,254  
    Net income   $ 11,626   $ 10,621   $ 10,507   $ 9,234   $ 10,166  
                                     
    PER COMMON SHARE DATA                                
    (unaudited)                                    
    Basic earnings per share   $ 0.19   $ 0.17   $ 0.17   $ 0.15   $ 0.17  
    Diluted earnings per share   $ 0.19   $ 0.17   $ 0.17   $ 0.15   $ 0.17  
    Weighted average shares outstanding – basic     61,479,579     61,320,505     61,295,877     61,279,914     61,186,623  
    Weighted average shares outstanding – diluted     61,708,361     61,679,735     61,546,157     61,438,088     61,470,552  
    Common shares outstanding at period-end     61,611,121     61,348,095     61,297,344     61,292,094     61,253,625  
    Dividend per share   $ 0.13   $ 0.13   $ 0.13   $ 0.13   $ 0.13  
    Book value per share   $ 11.30   $ 11.24   $ 11.18   $ 11.08   $ 11.04  
    Tangible book value per share(1)   $ 8.48   $ 8.41   $ 8.33   $ 8.22   $ 8.17  
                                     
    KEY PERFORMANCE METRICS                                   
    (in $000’s, unaudited)                                     
    Annualized return on average equity     6.81 %   6.16 %   6.14 %   5.50 %   6.08 %
    Annualized return on average tangible                                
    common equity(1)     9.09 %   8.25 %   8.27 %   7.43 %   8.24 %
    Annualized return on average assets     0.85 %   0.75 %   0.78 %   0.71 %   0.79 %
    Annualized return on average tangible assets(1)     0.88 %   0.78 %   0.81 %   0.74 %   0.82 %
    Net interest margin (FTE)(1)     3.39 %   3.32 %   3.15 %   3.23 %   3.31 %
    Total revenue   $ 46,056   $ 46,370   $ 42,155   $ 41,731   $ 42,140  
    Pre-provision net revenue(1)   $ 16,600   $ 16,066   $ 14,600   $ 13,543   $ 14,604  
    Efficiency ratio(1)     63.96 %   65.35 %   65.37 %   67.55 %   65.34 %
                                     
    AVERAGE BALANCES                                     
    (in $000’s, unaudited)                                     
    Average assets   $ 5,559,896   $ 5,607,840   $ 5,352,067   $ 5,213,171   $ 5,178,636  
    Average tangible assets(1)   $ 5,386,001   $ 5,433,439   $ 5,177,114   $ 5,037,673   $ 5,002,597  
    Average earning assets   $ 5,188,317   $ 5,235,986   $ 4,980,082   $ 4,840,670   $ 4,810,505  
    Average loans held-for-sale   $ 2,290   $ 2,260   $ 1,493   $ 1,503   $ 2,749  
    Average loans held-for-investment   $ 3,429,014   $ 3,388,729   $ 3,359,647   $ 3,328,358   $ 3,297,240  
    Average deposits   $ 4,717,517   $ 4,771,491   $ 4,525,946   $ 4,394,545   $ 4,360,150  
    Average demand deposits – noninterest-bearing   $ 1,167,330   $ 1,222,393   $ 1,172,304   $ 1,127,145   $ 1,177,078  
    Average interest-bearing deposits   $ 3,550,187   $ 3,549,098   $ 3,353,642   $ 3,267,400   $ 3,183,072  
    Average interest-bearing liabilities   $ 3,589,872   $ 3,588,755   $ 3,393,264   $ 3,306,972   $ 3,222,603  
    Average equity   $ 692,733   $ 686,263   $ 680,404   $ 675,108   $ 672,292  
    Average tangible common equity(1)   $ 518,838   $ 511,862   $ 505,451   $ 499,610   $ 496,253  
                                     

    (1)This is a non-GAAP financial measure as defined and discussed under “Non-GAAP Financial Measures” in this press release.

                                 
        End of Period:   Percent Change From:  
    CONSOLIDATED BALANCE SHEETS      March 31,       December 31,       March 31,       December 31,       March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024    2024   
    ASSETS                            
    Cash and due from banks   $ 44,281     $ 29,864     $ 32,543     48   % 36   %
    Other investments and interest-bearing deposits                            
    in other financial institutions     700,769       938,259       508,816     (25 ) % 38   %
    Securities available-for-sale, at fair value     370,976       256,274       404,474     45   % (8 ) %
    Securities held-to-maturity, at amortized cost     576,718       590,016       636,249     (2 ) % (9 ) %
    Loans – held-for-sale – SBA, including deferred costs     1,884       2,375       1,946     (21 ) % (3 ) %
    Loans – held-for-investment:                            
    Commercial     489,241       531,350       452,231     (8 ) % 8   %
    Real estate:                            
    CRE – owner occupied     616,825       601,636       585,031     3   % 5   %
    CRE – non-owner occupied     1,363,275       1,341,266       1,271,184     2   % 7   %
    Land and construction     136,106       127,848       129,712     6   % 5   %
    Home equity     119,138       127,963       122,794     (7 ) % (3 ) %
    Multifamily     284,510       275,490       269,263     3   % 6   %
    Residential mortgages     465,330       471,730       490,035     (1 ) % (5 ) %
    Consumer and other     12,741       14,837       16,439     (14 ) % (22 ) %
    Loans     3,487,166       3,492,120       3,336,689     0   % 5   %
    Deferred loan fees, net     (268 )     (183 )     (587 )   46   % (54 ) %
    Total loans – held-for-investment, net of deferred fees     3,486,898       3,491,937       3,336,102     0   % 5   %
    Allowance for credit losses on loans     (48,262 )     (48,953 )     (47,888 )   (1 ) % 1   %
    Loans, net     3,438,636       3,442,984       3,288,214     0   % 5   %
    Company-owned life insurance     81,749       81,211       80,007     1   % 2   %
    Premises and equipment, net     9,772       10,140       9,986     (4 ) % (2 ) %
    Goodwill     167,631       167,631       167,631     0   % 0   %
    Other intangible assets     5,986       6,439       8,074     (7 ) % (26 ) %
    Accrued interest receivable and other assets     115,853       119,813       118,134     (3 ) % (2 ) %
    Total assets   $ 5,514,255     $ 5,645,006     $ 5,256,074     (2 ) % 5   %
                                 
    LIABILITIES AND SHAREHOLDERS’ EQUITY                            
    Liabilities:                            
    Deposits:                            
    Demand, noninterest-bearing   $ 1,128,593     $ 1,214,192     $ 1,242,059     (7 ) % (9 ) %
    Demand, interest-bearing     949,068       936,587       925,100     1   % 3   %
    Savings and money market     1,353,293       1,325,923       1,124,900     2   % 20   %
    Time deposits – under $250     37,592       38,988       38,105     (4 ) % (1 ) %
    Time deposits – $250 and over     213,357       206,755       200,739     3   % 6   %
    ICS/CDARS – interest-bearing demand, money market                            
    and time deposits     1,001,365       1,097,586       913,757     (9 ) % 10   %
    Total deposits     4,683,268       4,820,031       4,444,660     (3 ) % 5   %
    Subordinated debt, net of issuance costs     39,691       39,653       39,539     0   % 0   %
    Accrued interest payable and other liabilities     95,106       95,595       95,579     (1 ) % 0   %
    Total liabilities     4,818,065       4,955,279       4,579,778     (3 ) % 5   %
                                 
    Shareholders’ Equity:                            
    Common stock     511,596       510,070       507,578     0   % 1   %
    Retained earnings     191,401       187,762       181,306     2   % 6   %
    Accumulated other comprehensive loss     (6,807 )     (8,105 )     (12,588 )   (16 ) % (46 ) %
    Total shareholders’ equity     696,190       689,727       676,296     1   % 3   %
    Total liabilities and shareholders’ equity   $ 5,514,255     $ 5,645,006     $ 5,256,074     (2 ) % 5   %
                                 
                                   
        End of Period:
    CONSOLIDATED BALANCE SHEETS      March 31,       December 31,       September 30,      June 30,       March 31, 
    (in $000’s, unaudited)   2025   2024   2024   2024   2024
    ASSETS                              
    Cash and due from banks   $ 44,281     $ 29,864     $ 49,722     $ 37,497     $ 32,543  
    Other investments and interest-bearing deposits                              
    in other financial institutions     700,769       938,259       906,588       610,763       508,816  
    Securities available-for-sale, at fair value     370,976       256,274       237,612       273,043       404,474  
    Securities held-to-maturity, at amortized cost     576,718       590,016       604,193       621,178       636,249  
    Loans – held-for-sale – SBA, including deferred costs     1,884       2,375       1,649       1,899       1,946  
    Loans – held-for-investment:                              
    Commercial     489,241       531,350       481,266       477,929       452,231  
    Real estate:                              
    CRE – owner occupied     616,825       601,636       602,062       594,504       585,031  
    CRE – non-owner occupied     1,363,275       1,341,266       1,310,578       1,283,323       1,271,184  
    Land and construction     136,106       127,848       125,761       125,374       129,712  
    Home equity     119,138       127,963       124,090       126,562       122,794  
    Multifamily     284,510       275,490       273,103       268,968       269,263  
    Residential mortgages     465,330       471,730       479,524       484,809       490,035  
    Consumer and other     12,741       14,837       14,179       18,758       16,439  
    Loans     3,487,166       3,492,120       3,410,563       3,380,227       3,336,689  
    Deferred loan fees, net     (268 )     (183 )     (327 )     (434 )     (587 )
    Total loans – held-for-investment, net of deferred fees     3,486,898       3,491,937       3,410,236       3,379,793       3,336,102  
    Allowance for credit losses on loans     (48,262 )     (48,953 )     (47,819 )     (47,954 )     (47,888 )
    Loans, net     3,438,636       3,442,984       3,362,417       3,331,839       3,288,214  
    Company-owned life insurance     81,749       81,211       80,682       80,153       80,007  
    Premises and equipment, net     9,772       10,140       10,398       10,310       9,986  
    Goodwill     167,631       167,631       167,631       167,631       167,631  
    Other intangible assets     5,986       6,439       6,966       7,521       8,074  
    Accrued interest receivable and other assets     115,853       119,813       123,738       121,190       118,134  
    Total assets   $ 5,514,255     $ 5,645,006     $ 5,551,596     $ 5,263,024     $ 5,256,074  
                                   
    LIABILITIES AND SHAREHOLDERS’ EQUITY                              
    Liabilities:                              
    Deposits:                              
    Demand, noninterest-bearing   $ 1,128,593     $ 1,214,192     $ 1,272,139     $ 1,187,320     $ 1,242,059  
    Demand, interest-bearing     949,068       936,587       913,910       928,246       925,100  
    Savings and money market     1,353,293       1,325,923       1,309,676       1,126,520       1,124,900  
    Time deposits – under $250     37,592       38,988       39,060       39,046       38,105  
    Time deposits – $250 and over     213,357       206,755       196,945       203,886       200,739  
    ICS/CDARS – interest-bearing demand, money market                              
    and time deposits     1,001,365       1,097,586       997,803       959,592       913,757  
    Total deposits     4,683,268       4,820,031       4,729,533       4,444,610       4,444,660  
    Other short-term borrowings                              
    Subordinated debt, net of issuance costs     39,691       39,653       39,615       39,577       39,539  
    Accrued interest payable and other liabilities     95,106       95,595       97,096       99,638       95,579  
    Total liabilities     4,818,065       4,955,279       4,866,244       4,583,825       4,579,778  
                                   
    Shareholders’ Equity:                              
    Common stock     511,596       510,070       509,134       508,343       507,578  
    Retained earnings     191,401       187,762       185,110       182,571       181,306  
    Accumulated other comprehensive loss     (6,807 )     (8,105 )     (8,892 )     (11,715 )     (12,588 )
    Total shareholders’ equity     696,190       689,727       685,352       679,199       676,296  
    Total liabilities and shareholders’ equity   $ 5,514,255     $ 5,645,006     $ 5,551,596     $ 5,263,024     $ 5,256,074  
                                   
                                 
        At or For the Quarter Ended:   Percent Change From:  
    CREDIT QUALITY DATA      March 31,       December 31,       March 31,       December 31,       March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024    2024   
    Nonaccrual loans – held-for-investment:                            
    Land and construction loans   $ 4,793   $ 5,874   $ 4,673   (18 ) % 3   %
    Home equity and other loans     927     290     120   220   % 673   %
    Commercial loans     324     1,014     1,127   (68 ) % (71 ) %
    CRE loans               N/A     N/A    
    Total nonaccrual loans – held-for-investment:     6,044     7,178     5,920   (16 ) % 2   %
    Loans over 90 days past due                            
    and still accruing     268     489     1,951   (45 ) % (86 ) %
    Total nonperforming loans     6,312     7,667     7,871   (18 ) % (20 ) %
    Foreclosed assets               N/A     N/A    
    Total nonperforming assets   $ 6,312   $ 7,667   $ 7,871   (18 ) % (20 ) %
    Net charge-offs during the quarter   $ 965   $ 197   $ 254   390   % 280   %
    Provision for credit losses on loans during the quarter   $ 274   $ 1,331   $ 184   (79 ) % 49   %
    Allowance for credit losses on loans   $ 48,262   $ 48,953   $ 47,888   (1 ) % 1   %
    Classified assets   $ 40,034   $ 41,661   $ 35,392   (4 ) % 13   %
    Allowance for credit losses on loans to total loans     1.38 %   1.40 %   1.44 % (1 ) % (4 ) %
    Allowance for credit losses on loans to total nonperforming loans     764.61 %   638.49 %   608.41 % 20   % 26   %
    Nonperforming assets to total assets     0.11 %   0.14 %   0.15 % (21 ) % (27 ) %
    Nonperforming loans to total loans     0.18 %   0.22 %   0.24 % (18 ) % (25 ) %
    Classified assets to Heritage Commerce Corp                            
    Tier 1 capital plus allowance for credit losses on loans     7 %   7 %   6 % 0   % 17   %
    Classified assets to Heritage Bank of Commerce                            
    Tier 1 capital plus allowance for credit losses on loans     7 %   7 %   6 % 0   % 17   %
                                 
    OTHER PERIOD-END STATISTICS                                 
    (in $000’s, unaudited)                                 
    Heritage Commerce Corp:                            
    Tangible common equity (1)   $ 522,573   $ 515,657   $ 500,591   1   % 4   %
    Shareholders’ equity / total assets     12.63 %   12.22 %   12.87 % 3   % (2 ) %
    Tangible common equity / tangible assets (1)     9.78 %   9.43 %   9.85 % 4   % (1 ) %
    Loan to deposit ratio     74.45 %   72.45 %   75.06 % 3   % (1 ) %
    Noninterest-bearing deposits / total deposits     24.10 %   25.19 %   27.94 % (4 ) % (14 ) %
    Total capital ratio     15.9 %   15.6 %   15.6 % 2   % 2   %
    Tier 1 capital ratio     13.6 %   13.4 %   13.4 % 1   % 1   %
    Common Equity Tier 1 capital ratio     13.6 %   13.4 %   13.4 % 1   % 1   %
    Tier 1 leverage ratio     9.8 %   9.6 %   10.2 % 2   % (4 ) %
    Heritage Bank of Commerce:                            
    Tangible common equity / tangible assets (1)     10.15 %   9.79 %   10.22 % 4   % (1 ) %
    Total capital ratio     15.4 %   15.1 %   15.1 % 2   % 2   %
    Tier 1 capital ratio     14.1 %   13.9 %   13.9 % 1   % 1   %
    Common Equity Tier 1 capital ratio     14.1 %   13.9 %   13.9 % 1   % 1   %
    Tier 1 leverage ratio     10.2 %   10.0 %   10.6 % 2   % (4 ) %
                                 

    (1)This is a non-GAAP financial measure as defined and discussed under “Non-GAAP Financial Measures” in this press release.

                                     
        At or For the Quarter Ended:  
    CREDIT QUALITY DATA      March 31,       December 31,       September 30,      June 30,       March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024   2024  
    Nonaccrual loans – held-for-investment:                                
    Land and construction loans   $ 4,793   $ 5,874   $ 5,862   $ 4,774   $ 4,673  
    Home equity and other loans     927     290     84     108     120  
    Commercial loans     324     1,014     752     900     1,127  
    CRE loans                      
    Total nonaccrual loans – held-for-investment:     6,044     7,178     6,698     5,782     5,920  
    Loans over 90 days past due                                
    and still accruing     268     489     460     248     1,951  
    Total nonperforming loans     6,312     7,667     7,158     6,030     7,871  
    Foreclosed assets                      
    Total nonperforming assets   $ 6,312   $ 7,667   $ 7,158   $ 6,030   $ 7,871  
    Net charge-offs during the quarter   $ 965   $ 197   $ 288   $ 405   $ 254  
    Provision for credit losses on loans during the quarter   $ 274   $ 1,331   $ 153   $ 471   $ 184  
    Allowance for credit losses on loans   $ 48,262   $ 48,953   $ 47,819   $ 47,954   $ 47,888  
    Classified assets   $ 40,034   $ 41,661   $ 32,609   $ 33,605   $ 35,392  
    Allowance for credit losses on loans to total loans     1.38 %   1.40 %   1.40 %   1.42 %   1.44 %
    Allowance for credit losses on loans to total nonperforming loans     764.61 %   638.49 %   668.05 %   795.26 %   608.41 %
    Nonperforming assets to total assets     0.11 %   0.14 %   0.13 %   0.11 %   0.15 %
    Nonperforming loans to total loans     0.18 %   0.22 %   0.21 %   0.18 %   0.24 %
    Classified assets to Heritage Commerce Corp                                
    Tier 1 capital plus allowance for credit losses on loans     7 %   7 %   6 %   6 %   6 %
    Classified assets to Heritage Bank of Commerce                                
    Tier 1 capital plus allowance for credit losses on loans     7 %   7 %   6 %   6 %   6 %
                                     
    OTHER PERIOD-END STATISTICS                                     
    (in $000’s, unaudited)                                     
    Heritage Commerce Corp:                                
    Tangible common equity (1)   $ 522,573   $ 515,657   $ 510,755   $ 504,047   $ 500,591  
    Shareholders’ equity / total assets     12.63 %   12.22 %   12.35 %   12.91 %   12.87 %
    Tangible common equity / tangible assets (1)     9.78 %   9.43 %   9.50 %   9.91 %   9.85 %
    Loan to deposit ratio     74.45 %   72.45 %   72.11 %   76.04 %   75.06 %
    Noninterest-bearing deposits / total deposits     24.10 %   25.19 %   26.90 %   26.71 %   27.94 %
    Total capital ratio     15.9 %   15.6 %   15.6 %   15.6 %   15.6 %
    Tier 1 capital ratio     13.6 %   13.4 %   13.4 %   13.4 %   13.4 %
    Common Equity Tier 1 capital ratio     13.6 %   13.4 %   13.4 %   13.4 %   13.4 %
    Tier 1 leverage ratio     9.8 %   9.6 %   10.0 %   10.2 %   10.2 %
    Heritage Bank of Commerce:                                
    Tangible common equity / tangible assets (1)     10.15 %   9.79 %   9.86 %   10.28 %   10.22 %
    Total capital ratio     15.4 %   15.1 %   15.1 %   15.1 %   15.1 %
    Tier 1 capital ratio     14.1 %   13.9 %   13.9 %   13.9 %   13.9 %
    Common Equity Tier 1 capital ratio     14.1 %   13.9 %   13.9 %   13.9 %   13.9 %
    Tier 1 leverage ratio     10.2 %   10.0 %   10.4 %   10.6 %   10.6 %
                                     

    (1)This is a non-GAAP financial measure as defined and discussed under “Non-GAAP Financial Measures” in this press release.

                                       
        For the Quarter Ended   For the Quarter Ended  
        March 31, 2025   December 31, 2024  
                    Interest      Average               Interest      Average  
    NET INTEREST INCOME AND NET INTEREST MARGIN   Average   Income/   Yield/   Average   Income/   Yield/  
    (in $000’s, unaudited)   Balance   Expense   Rate   Balance   Expense   Rate  
    Assets:                                  
    Loans, core bank   $ 2,945,072       39,758     5.47 % $ 2,899,347     $ 39,852     5.47 %
    Prepayment fees           224     0.03 %         35     0.00 %
    Bay View Funding factored receivables     60,250       2,942     19.80 %   59,153       3,084     20.74 %
    Purchased residential mortgages     427,963       3,597     3.41 %   434,846       3,732     3.41 %
    Loan fair value mark / accretion     (1,981 )     181     0.02 %   (2,357 )     429     0.06 %
    Loans, gross (1)(2)     3,431,304       46,702     5.52 %   3,390,989       47,132     5.53 %
    Securities – taxable     876,092       5,559     2.57 %   800,174       4,475     2.22 %
    Securities – exempt from Federal tax (3)     30,480       275     3.66 %   30,570       274     3.57 %
    Other investments and interest-bearing deposits                                  
    in other financial institutions     850,441       9,354     4.46 %   1,014,253       12,220     4.79 %
    Total interest earning assets (3)     5,188,317       61,890     4.84 %   5,235,986       64,101     4.87 %
    Cash and due from banks     31,869                 32,569              
    Premises and equipment, net     10,007                 10,301              
    Goodwill and other intangible assets     173,895                 174,401              
    Other assets     155,808                 154,583              
    Total assets   $ 5,559,896               $ 5,607,840              
                                       
    Liabilities and shareholders’ equity:                                  
    Deposits:                                  
    Demand, noninterest-bearing   $ 1,167,330               $ 1,222,393              
                                       
    Demand, interest-bearing     944,375       1,438     0.62 %   906,581       1,452     0.64 %
    Savings and money market     1,323,038       8,073     2.47 %   1,339,397       9,090     2.70 %
    Time deposits – under $100     11,383       47     1.67 %   11,388       49     1.71 %
    Time deposits – $100 and over     234,421       2,129     3.68 %   234,446       2,310     3.92 %
    ICS/CDARS – interest-bearing demand, money market                                  
    and time deposits     1,036,970       6,248     2.44 %   1,057,286       7,009     2.64 %
    Total interest-bearing deposits     3,550,187       17,935     2.05 %   3,549,098       19,910     2.23 %
    Total deposits     4,717,517       17,935     1.54 %   4,771,491       19,910     1.66 %
                                       
    Short-term borrowings     18           0.00 %   28           0.00 %
    Subordinated debt, net of issuance costs     39,667       537     5.49 %   39,629       538     5.40 %
    Total interest-bearing liabilities     3,589,872       18,472     2.09 %   3,588,755       20,448     2.27 %
    Total interest-bearing liabilities and demand,                                  
    noninterest-bearing / cost of funds     4,757,202       18,472     1.57 %   4,811,148       20,448     1.69 %
    Other liabilities     109,961                 110,429              
    Total liabilities     4,867,163                 4,921,577              
    Shareholders’ equity     692,733                 686,263              
    Total liabilities and shareholders’ equity   $ 5,559,896               $ 5,607,840              
                                       
    Net interest income / margin (3)           43,418     3.39 %         43,653     3.32 %
    Less tax equivalent adjustment (3)           (58 )               (58 )      
    Net interest income         $ 43,360     3.39 %       $ 43,595     3.31 %
                                       

    (1)Includes loans held-for-sale. Nonaccrual loans are included in average balances.
    (2)Yield amounts earned on loans include fees and costs. The accretion of net deferred loan fees into loan interest income was $214,000 for the first quarter of 2025, compared to $167,000 for the fourth quarter of 2024. Prepayment fees totaled $224,000 for the first quarter of 2025, compared to $35,000 for the fourth quarter of 2024.
    (3)Reflects the FTE adjustment for Federal tax-exempt income based on a 21% tax rate. This is a non-GAAP financial measure as defined and discussed under “Non-GAAP FinanciaMeasures” in this press release.

                                       
        For the Quarter Ended   For the Quarter Ended  
        March 31, 2025   March 31, 2024  
                    Interest      Average               Interest      Average  
    NET INTEREST INCOME AND NET INTEREST MARGIN   Average   Income/   Yield/   Average   Income/   Yield/  
    (in $000’s, unaudited)   Balance   Expense   Rate   Balance   Expense   Rate  
    Assets:                                  
    Loans, core bank   $ 2,945,072     $ 39,758     5.47 % $ 2,795,351     $ 37,721     5.43 %
    Prepayment fees           224     0.03 %         24     0.00 %
    Bay View Funding factored receivables     60,250       2,942     19.80 %   53,511       2,838     21.33 %
    Purchased residential mortgages     427,963       3,597     3.41 %   454,240       3,788     3.35 %
    Loan fair value mark / accretion     (1,981 )     181     0.02 %   (3,113 )     229     0.03 %
    Loans, gross (1)(2)     3,431,304       46,702     5.52 %   3,299,989       44,600     5.44 %
    Securities – taxable     876,092       5,559     2.57 %   1,042,484       6,183     2.39 %
    Securities – exempt from Federal tax (3)     30,480       275     3.66 %   31,939       286     3.60 %
    Other investments and interest-bearing deposits                                  
    in other financial institutions     850,441       9,354     4.46 %   436,093       5,951     5.49 %
    Total interest earning assets (3)     5,188,317       61,890     4.84 %   4,810,505       57,020     4.77 %
    Cash and due from banks     31,869                 33,214              
    Premises and equipment, net     10,007                 10,015              
    Goodwill and other intangible assets     173,895                 176,039              
    Other assets     155,808                 148,863              
    Total assets   $ 5,559,896               $ 5,178,636              
                                       
    Liabilities and shareholders’ equity:                                  
    Deposits:                                  
    Demand, noninterest-bearing   $ 1,167,330               $ 1,177,078              
                                       
    Demand, interest-bearing     944,375       1,438     0.62 %   920,048       1,554     0.68 %
    Savings and money market     1,323,038       8,073     2.47 %   1,067,581       6,649     2.50 %
    Time deposits – under $100     11,383       47     1.67 %   10,945       42     1.54 %
    Time deposits – $100 and over     234,421       2,129     3.68 %   221,211       2,064     3.75 %
    ICS/CDARS – interest-bearing demand, money market                                  
    and time deposits     1,036,970       6,248     2.44 %   963,287       6,611     2.76 %
    Total interest-bearing deposits     3,550,187       17,935     2.05 %   3,183,072       16,920     2.14 %
    Total deposits     4,717,517       17,935     1.54 %   4,360,150       16,920     1.56 %
                                       
    Short-term borrowings     18           0.00 %   15           0.00 %
    Subordinated debt, net of issuance costs     39,667       537     5.49 %   39,516       538     5.48 %
    Total interest-bearing liabilities     3,589,872       18,472     2.09 %   3,222,603       17,458     2.18 %
    Total interest-bearing liabilities and demand,                                  
    noninterest-bearing / cost of funds     4,757,202       18,472     1.57 %   4,399,681       17,458     1.60 %
    Other liabilities     109,961                 106,663              
    Total liabilities     4,867,163                 4,506,344              
    Shareholders’ equity     692,733                 672,292              
    Total liabilities and shareholders’ equity   $ 5,559,896               $ 5,178,636              
                                       
    Net interest income / margin (3)           43,418     3.39 %         39,562     3.31 %
    Less tax equivalent adjustment (3)           (58 )               (60 )      
    Net interest income         $ 43,360     3.39 %       $ 39,502     3.30 %

    (1)Includes loans held-for-sale. Nonaccrual loans are included in average balances.
    (2)Yield amounts earned on loans include fees and costs. The accretion of net deferred loan fees into loan interest income was $214,000 for the first quarter of 2025, compared to $160,000 for the first quarter of 2024. Prepayment fees totaled $224,000 for the first quarter of 2025, compared to $24,000 for the first quarter of 2024.
    (3)Reflects the FTE adjustment for Federal tax-exempt income based on a 21% tax rate. This is a non-GAAP financial measure as defined and discussed under “Non-GAAP Financial Measures” in this press release.

    RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

    Management considers tangible book value per share as a useful measurement of the Company’s equity. The Company references the return on average tangible common equity and the return on average tangible assets as measurements of profitability.

    The following table summarizes components of the tangible book value per share at the dates indicated:

                                     
    TANGIBLE BOOK VALUE PER SHARE   March 31,    December 31,    September 30,   June 30,   March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024   2024  
    Capital components:                                
    Total Equity (GAAP)   $ 696,190     $ 689,727     $ 685,352     $ 679,199     $ 676,296    
    Less: Preferred Stock                                
    Total Common Equity     696,190       689,727       685,352       679,199       676,296    
    Less: Goodwill     (167,631 )     (167,631 )     (167,631 )     (167,631 )     (167,631 )  
    Less: Other Intangible Assets     (5,986 )     (6,439 )     (6,966 )     (7,521 )     (8,074 )  
    Total Tangible Common Equity (non-GAAP)   $ 522,573     $ 515,657     $ 510,755     $ 504,047     $ 500,591    
                                     
    Common shares outstanding at period-end     61,611,121       61,348,095       61,297,344       61,292,094       61,253,625    
                                     
    Tangible book value per share (non-GAAP)   $ 8.48     $ 8.41     $ 8.33     $ 8.22     $ 8.17    
                                               

    The following tables summarize components of the annualized return on average tangible common equity and the annualized return on average tangible assets for the periods indicated:

                                     
    RETURN ON AVERAGE TANGIBLE COMMON   For the Quarter Ended:  
    EQUITY AND AVERAGE TANGIBLE COMMON ASSETS   March 31,    December 31,    September 30,   June 30,   March 31,   
    (in $000’s, unaudited)   2025   2024     2024    2024   2024  
    Net income   $ 11,626     $ 10,621     $ 10,507     $ 9,234     $ 10,166    
                                     
    Average tangible common equity components:                                
    Average Equity (GAAP)   $ 692,733     $ 686,263     $ 680,404     $ 675,108     $ 672,292    
    Less: Goodwill     (167,631 )     (167,631 )     (167,631 )     (167,631 )     (167,631 )  
    Less: Other Intangible Assets     (6,264 )     (6,770 )     (7,322 )     (7,867 )     (8,408 )  
    Total Average Tangible Common Equity (non-GAAP)   $ 518,838     $ 511,862     $ 505,451     $ 499,610     $ 496,253    
                                     
    Annualized return on average tangible common equity (non-GAAP)     9.09   %   8.25   %   8.27   %   7.43   %   8.24   %
                                     
    Average tangible assets components:                                
    Average Assets (GAAP)   $ 5,559,896     $ 5,607,840     $ 5,352,067     $ 5,213,171     $ 5,178,636    
    Less: Goodwill     (167,631 )     (167,631 )     (167,631 )     (167,631 )     (167,631 )  
    Less: Other Intangible Assets     (6,264 )     (6,770 )     (7,322 )     (7,867 )     (8,408 )  
    Total Average Tangible Assets (non-GAAP)   $ 5,386,001     $ 5,433,439     $ 5,177,114     $ 5,037,673     $ 5,002,597    
                                     
    Annualized return on average tangible assets (non-GAAP)     0.88   %   0.78   %   0.81   %   0.74   %   0.82   %
                                               

    Management reviews yields on certain asset categories and the net interest margin of the Company on an FTE basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis using tax rates effective as of the end of the period. This measure ensures comparability of net interest income arising from both taxable and tax-exempt sources. The following tables summarize components of FTE net interest income of the Company for the periods indicated:

                                     
        For the Quarter Ended:  
        March 31,    December 31,    September 30,    June 30,    March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024   2024  
    Net interest income before                                
    credit losses on loans (GAAP)   $ 43,360   $ 43,595   $ 39,329   $ 38,867   $ 39,502  
    Tax-equivalent adjustment on securities –                                
    exempt from Federal tax     58     58     59     60     60  
    Net interest income, FTE (non-GAAP)   $ 43,418   $ 43,653   $ 39,388   $ 38,927   $ 39,562  
                                     
    Average balance of total interest earning assets   $ 5,188,317   $ 5,235,986   $ 4,980,082   $ 4,840,670   $ 4,810,505  
                                     
    Net interest margin (annualized net interest income divided by the                                
    average balance of total interest earnings assets) (GAAP)     3.39 %   3.31 %   3.14 %   3.23 %   3.30 %
                                     
    Net interest margin, FTE (annualized net interest income, FTE,                                
    divided by the average balance of total                                
    earnings assets) (non-GAAP)     3.39 %   3.32 %   3.15 %   3.23 %   3.31 %
                                     

    Management views its non-GAAP PPNR as a key metric for assessing the Company’s earnings power. The following table summarizes the components of PPNR for the periods indicated:

                                   
        For the Quarter Ended:
        March 31,    December 31,    September 30,   June 30,   March 31, 
    (in $000’s, unaudited)   2025   2024   2024   2024   2024
                                   
                                   
    Net interest income before credit losses on loans   $ 43,360     $ 43,595     $ 39,329     $ 38,867     $ 39,502  
    Noninterest income     2,696       2,775       2,826       2,864       2,638  
    Total revenue     46,056       46,370     $ 42,155     $ 41,731     $ 42,140  
    Less: Noninterest expense     (29,456 )     (30,304 )     (27,555 )     (28,188 )     (27,536 )
    PPNR (non-GAAP)   $ 16,600     $ 16,066     $ 14,600     $ 13,543     $ 14,604  
                                             

    The efficiency ratio is a non-GAAP financial measure, which is calculated by dividing noninterest expense by total revenue (net interest income plus noninterest income), and measures how much it costs to produce one dollar of revenue. The following tables summarize components of the efficiency ratio of the Company for the periods indicated:

                                     
        For the Quarter Ended:  
        March 31,    December 31,    September 30,   June 30,   March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024   2024  
    Noninterest expense   $ 29,456   $ 30,304   $ 27,555   $ 28,188   $ 27,536  
                                     
    Net interest income before credit losses on loans   $ 43,360   $ 43,595   $ 39,329   $ 38,867   $ 39,502  
    Noninterest income     2,696     2,775     2,826     2,864     2,638  
    Total revenue   $ 46,056   $ 46,370   $ 42,155   $ 41,731   $ 42,140  
                                     
    Efficiency ratio (noninterest expense divided                                
    by total revenue) (non-GAAP)     63.96 %   65.35 %   65.37 %   67.55 %   65.34 %
                                     

    Management considers the tangible common equity ratio as a useful measurement of the Company’s and the Bank’s equity. The following table summarizes components of the tangible common equity to tangible assets ratio of the Company at the dates indicated:

                                     
    TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS   March 31,    December 31,    September 30,      June 30,       March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024   2024   
    Capital components:                                
    Total Equity (GAAP)   $ 696,190     $ 689,727     $ 685,352     $ 679,199     $ 676,296    
    Less: Preferred Stock                                
    Total Common Equity     696,190       689,727       685,352       679,199       676,296    
    Less: Goodwill     (167,631 )     (167,631 )     (167,631 )     (167,631 )     (167,631 )  
    Less: Other Intangible Assets     (5,986 )     (6,439 )     (6,966 )     (7,521 )     (8,074 )  
    Total Tangible Common Equity (non-GAAP)   $ 522,573     $ 515,657     $ 510,755     $ 504,047     $ 500,591    
                                     
    Asset components:                                
    Total Assets (GAAP)   $ 5,514,255     $ 5,645,006     $ 5,551,596     $ 5,263,024     $ 5,256,074    
    Less: Goodwill     (167,631 )     (167,631 )     (167,631 )     (167,631 )     (167,631 )  
    Less: Other Intangible Assets     (5,986 )     (6,439 )     (6,966 )     (7,521 )     (8,074 )  
    Total Tangible Assets (non-GAAP)   $ 5,340,638     $ 5,470,936     $ 5,376,999     $ 5,087,872     $ 5,080,369    
                                     
    Tangible common equity / tangible assets (non-GAAP)     9.78   %   9.43   %   9.50   %   9.91   %   9.85   %
                                               

    The following table summarizes components of the tangible common equity to tangible assets ratio of the Bank at the dates indicated:

                                     
    TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS   March 31,    December 31,    September 30,      June 30,    March 31,   
    (in $000’s, unaudited)   2025   2024   2024   2024   2024  
    Capital components:                                
    Total Equity (GAAP)   $ 715,605     $ 709,379     $ 704,585     $ 697,964     $ 694,543    
    Less: Preferred Stock                                
    Total Common Equity     715,605       709,379       704,585       697,964       694,543    
    Less: Goodwill     (167,631 )     (167,631 )     (167,631 )     (167,631 )     (167,631 )  
    Less: Other Intangible Assets     (5,986 )     (6,439 )     (6,966 )     (7,521 )     (8,074 )  
    Total Tangible Common Equity (non-GAAP)   $ 541,988     $ 535,309     $ 529,988     $ 522,812     $ 518,838    
                                     
    Asset components:                                
    Total Assets (GAAP)   $ 5,512,160     $ 5,641,646     $ 5,548,576     $ 5,260,500     $ 5,254,044    
    Less: Goodwill     (167,631 )     (167,631 )     (167,631 )     (167,631 )     (167,631 )  
    Less: Other Intangible Assets     (5,986 )     (6,439 )     (6,966 )     (7,521 )     (8,074 )  
    Total Tangible Assets (non-GAAP)   $ 5,338,543     $ 5,467,576     $ 5,373,979     $ 5,085,348     $ 5,078,339    
                                     
    Tangible common equity / tangible assets (non-GAAP)     10.15   %   9.79   %   9.86   %   10.28   %   10.22   %
                                               

    The MIL Network

  • MIL-OSI: OceanFirst Financial Corp. Announces First Quarter Financial Results

    Source: GlobeNewswire (MIL-OSI)

    RED BANK, N.J., April 24, 2025 (GLOBE NEWSWIRE) — OceanFirst Financial Corp. (NASDAQ:OCFC) (the “Company”), the holding company for OceanFirst Bank N.A. (the “Bank”), announced net income available to common stockholders of $20.5 million, or $0.35 per diluted share, for the quarter ended March 31, 2025, a decrease from $27.7 million, or $0.47 per diluted share, for the corresponding prior year period, and a decrease from $20.9 million, or $0.36 per diluted share, for the linked quarter. Selected performance metrics are as follows (refer to “Selected Quarterly Financial Data” for additional information):

        For the Three Months Ended,
        March 31,   December 31,   March 31,
    Performance Ratios (Annualized):   2025   2024   2024
    Return on average assets   0.62 %   0.61 %   0.82 %
    Return on average stockholders’ equity   4.85     4.88     6.65  
    Return on average tangible stockholders’ equity (a)   7.05     7.12     9.61  
    Return on average tangible common equity (a)   7.40     7.47     10.09  
    Efficiency ratio   65.67     67.86     59.56  
    Net interest margin   2.90     2.69     2.81  

    (a) Return on average tangible stockholders’ equity and return on average tangible common equity (“ROTCE”) are non-GAAP (“generally accepted accounting principles”) financial measures. Refer to “Explanation of Non-GAAP Financial Measures,” “Selected Quarterly Financial Data” and “Non-GAAP Reconciliation” tables for reconciliation and additional information regarding non-GAAP financial measures.

    Core earnings1 for the quarter ended March 31, 2025 were $20.3 million, or $0.35 per diluted share, a decrease from $25.6 million, or $0.44 per diluted share, for the corresponding prior year period, and a decrease from $22.1 million, or $0.38 per diluted share, for the linked quarter.

    Core earnings PTPP1 for the quarter ended March 31, 2025 was $32.4 million, or $0.56 per diluted share, as compared to $36.2 million, or $0.62 per diluted share, for the corresponding prior year period, and $29.6 million, or $0.51 per diluted share, for the linked quarter. Selected performance metrics are as follows:

        For the Three Months Ended,
        March 31,   December 31,   March 31,
    Core Ratios(Annualized):     2025       2024       2024  
    Return on average assets     0.62 %     0.65 %     0.76 %
    Return on average tangible stockholders’ equity     7.00       7.51       8.91  
    Return on average tangible common equity     7.34       7.89       9.36  
    Efficiency ratio     65.81       67.74       61.05  
    Core diluted earnings per share   $ 0.35     $ 0.38     $ 0.44  
    Core PTPP diluted earnings per share     0.56       0.51       0.62  

    Key developments for the recent quarter are described below:

    • Margin Expansion: Net interest margin increased 21 basis points to 2.90%, from 2.69%, and net interest income increased by $3.3 million to $86.7 million driven by a decrease in total cost of deposits to 2.06% from 2.32% in the linked quarter.
    • Commercial Loans: Commercial and industrial loans increased $95.1 million, or 6.1% as compared to the linked quarter. Additionally, the total commercial loan pipeline increased 90% to $375.6 million from $197.5 million in the linked quarter.
    • Provision for Credit Losses: Provision for credit losses was $5.3 million reflecting a net loan reserve build of $5.2 million, primarily driven by elevated uncertainty around macroeconomic conditions. This resulted in an increase of five basis points in the allowance for loan credit losses to total loans to 0.78%. Criticized and classified loans decreased by 5% to $149.3 million compared to the linked quarter, providing strong evidence of stable credit performance for the Company’s loan portfolio.

    Chairman and Chief Executive Officer, Christopher D. Maher, commented on the Company’s results, “We are pleased to present our current quarter results, which reflect a meaningful expansion of net interest income and net interest margin, continued strong asset quality metrics, and further capital accretion, including share repurchases.” Mr. Maher added, “Additionally, we understand the increased market uncertainty and volatility, but we have confidence that the Company is well-positioned. Finally, we are pleased that the first quarter talent recruiting season has resulted in a robust addition of commercial banking talent. Reflecting the strength of the commercial banking platform we have built, 36 highly experienced commercial bankers have joined OceanFirst this year.”

    The Company’s Board of Directors declared its 113th consecutive quarterly cash dividend on common stock. The quarterly cash dividend on common stock of $0.20 per share will be paid on May 16, 2025 to common stockholders of record on May 5, 2025. The Company’s Board of Directors also previously declared a quarterly cash dividend on preferred stock of $0.4375 per depositary share, representing 1/40th interest in the Series A Preferred Stock. This dividend will be paid on May 15, 2025 to preferred stockholders of record on April 30, 2025. The Company has notified the preferred stockholders that it intends to redeem the Series A Preferred Stock in full on May 15, 2025.

    1 Core earnings and core earnings before income taxes and provision for credit losses (“PTPP” or “Pre-Tax-Pre-Provision”), and ratios derived therefrom, are non-GAAP financial measures. For the periods presented, core earnings exclude merger related expenses, net (gain) loss on equity investments, net gain on sale of trust business, the opening provision for credit losses in connection with the acquisition of Spring Garden Capital Group, LLC (“Spring Garden”), the Federal Deposit Insurance Corporation (“FDIC”) special assessment, and the income tax effect of these items, (collectively referred to as “non-core” operations). PTPP excludes the aforementioned pre-tax “non-core” items along with income tax expense (benefit) and provision for credit losses (exclusive of the Spring Garden opening provision). Refer to “Explanation of Non-GAAP Financial Measures,” “Selected Quarterly Financial Data” and the “Non-GAAP Reconciliation” tables for additional information regarding non-GAAP financial measures.

    Results of Operations

    The current quarter was impacted by a decrease in average interest earning assets and liabilities, benefited from funding cost repricing efforts, and included a sale of non-performing residential and consumer loans of $5.1 million, which had related charge-offs of $720,000. Additionally, the current quarter included non-recurring benefits of $842,000 in other income and $1.3 million in normal incentive related adjustments.

    Net Interest Income and Margin

    Three months ended March 31, 2025 vs. March 31, 2024

    Net interest income increased to $86.7 million, from $86.2 million, primarily reflecting the net impact of the decreasing interest rate environment. Net interest margin increased to 2.90%, from 2.81%, which included the impact of purchase accounting accretion and prepayment fees of 0.03% and 0.04%, respectively. Net interest margin increased primarily due to the decrease in cost of funds outpacing the decrease in yield on average interest-earning assets.

    Average interest-earning assets decreased by $238.4 million primarily due to a decrease in commercial loans and securities. The average yield for interest-earning assets decreased to 5.13%, from 5.26%.

    The cost of average interest-bearing liabilities decreased to 2.78%, from 3.03%, primarily due to lower cost of deposits and, to a lesser extent, Federal Home Loan Bank (“FHLB”) advances. The total cost of deposits decreased 25 basis points to 2.06%, from 2.31%. Average interest-bearing liabilities decreased by $226.1 million, primarily due to decreases in savings, time deposits and other borrowings, largely offset by an increase in FHLB advances.

    Three months ended March 31, 2025 vs. December 31, 2024

    Net interest income increased by $3.3 million and net interest margin increased to 2.90%, from 2.69%, primarily reflecting the impact of deposit repricing. Net interest income included the impact of purchase accounting accretion and prepayment fees of 0.03% in the current quarter and none in the prior quarter.

    Average interest-earning assets decreased by $219.5 million, primarily due to decreases in securities and interest-earning cash deposits. The yield on average interest-earning assets decreased to 5.13%, from 5.15%.

    Average interest-bearing liabilities decreased by $211.3 million, primarily due to decreases in deposits and other borrowings, partly offset by an increase in FHLB advances. The total cost of average interest-bearing liabilities decreased to 2.78%, from 3.04%, primarily due to lower cost of deposits. The total cost of deposits decreased to 2.06%, from 2.32%.

    Provision for Credit Losses

    Provision for credit losses for the quarter ended March 31, 2025 was $5.3 million, as compared to $591,000 for the corresponding prior year period and $3.5 million for the linked quarter. The linked quarter included a $1.4 million initial provision for credit losses related to the acquisition of Spring Garden. The current quarter provision was primarily driven by elevated uncertainty around macroeconomic conditions.

    Net loan charge-offs were $636,000 for the quarter ended March 31, 2025, as compared to net loan charge-offs of $349,000 for the corresponding prior year period and net loan recoveries of $158,000 in the linked quarter. The current quarter includes charge-offs of $720,000 related to the sale of $5.1 million non-performing residential and consumer loans. Refer to “Results of Operations” section for further discussion.

    Non-interest Income

    Three months ended March 31, 2025 vs. March 31, 2024

    Other income decreased to $11.3 million, as compared to $12.3 million. Other income was favorably impacted by non-core operations of $205,000 related to net gains on equity investments in the current quarter. The prior year other income was favorably impacted by non-core operations of $3.1 million related to net gains on equity investments and a gain on sale of a portion of the Company’s trust business.

    Excluding non-core operations, other income increased by $1.8 million. The primary drivers were increases related to net gain on sale of loans of $501,000, commercial loan swap income of $482,000, and an increase in non-recurring other income of $842,000 as noted above.

    Three months ended March 31, 2025 vs. December 31, 2024

    Excluding non-core operations, other income decreased by $1.2 million from $12.2 million in the linked quarter. The primary drivers were decreases in fees and service charges of $1.5 million, primarily due to lower title fee income as a result of seasonality, and income from bank owned life insurance of $686,000, related to non-recurring death benefits of $768,000 in the linked quarter. This was partly offset by increases in commercial loan swap income of $534,000 and non-recurring other income of $842,000 noted above.

    Non-interest Expense

    Three months ended March 31, 2025 vs. March 31, 2024

    Operating expenses increased to $64.3 million, as compared to $58.7 million. Operating expenses in the prior year were adversely impacted by non-core operations of $418,000 from an FDIC special assessment.

    Excluding non-core operations, operating expenses increased by $6.0 million. The primary driver was an increase in compensation and benefits of $4.0 million, mostly due to acquisitions at the end of the prior year and annual merit increases. Additional drivers were increases in other operating expenses of $1.0 million, due to additional loan servicing expense, and increases in data processing expense of $691,000, partly due to acquisitions at the end of the prior year.

    Three months ended March 31, 2025 vs. December 31, 2024

    Operating expenses in the linked quarter were $64.8 million and were adversely impacted by non-core items of $110,000 from merger-related expenses. Excluding non-core operations, operating expenses decreased by $445,000. This included a decrease in normal incentive related adjustments of $1.3 million, offset by annual merit increases during the year. Additionally, there were decreases in other operating expense of $840,000, mostly related to lower title costs and marketing of $507,000. This was partly offset by an increase in federal deposit insurance and regulatory assessments of $466,000.

    Income Tax Expense

    The provision for income taxes was $6.8 million for the quarter ended March 31, 2025, as compared to $10.6 million for the same prior year period and $5.1 million for the linked quarter. The effective tax rate was 24.1% for the quarter ended March 31, 2025, as compared to 27.1% for the same prior year period and 18.7% for the linked quarter. The prior year’s effective tax rate was negatively impacted by 3.0% due to a one-time write-off of a deferred tax asset of $1.2 million. The linked quarter’s effective tax rate was positively impacted by utilization of higher tax credits.

    Financial Condition

    March 31, 2025 vs. December 31, 2024

    Total assets decreased by $112.0 million to $13.31 billion, from $13.42 billion, primarily due to decreases in total debt securities. Debt securities available-for-sale decreased by $81.3 million to $746.2 million, from $827.5 million, primarily due to principal reductions, maturities and calls. Debt securities held-to-maturity decreased by $40.4 million to $1.01 billion, from $1.05 billion, primarily due to principal repayments. Loans held-for-sale decreased by $11.5 million to $9.7 million from $21.2 million. Total loans increased by $7.2 million to $10.13 billion, from $10.12 billion, while the loan pipeline increased by $197.8 million to $504.4 million, from $306.7 million. Other assets decreased by $14.9 million to $170.8 million, from $185.7 million, primarily due to a decrease in market values associated with customer interest rate swap programs.

    Total liabilities decreased by $118.3 million to $11.60 billion, from $11.72 billion primarily related to a funding mix-shift. Deposits increased by $110.7 million to $10.18 billion, from $10.07 billion, primarily due to increases in non-interest bearing, savings and time deposits. Time deposits increased to $2.12 billion, from $2.08 billion, representing 20.8% and 20.7% of total deposits, respectively. Time deposits included an increase in brokered time deposits of $295.8 million, offset by a decrease in retail time deposits of $251.1 million. The loan-to-deposit ratio was 99.5%, as compared to 100.5%. FHLB advances decreased by $181.6 million to $891.0 million, from $1.07 billion partly driven by a shift to slightly favorably priced brokered deposits.

    Other liabilities decreased by $58.0 million to $240.4 million, from $298.4 million, primarily due to a decrease in the market values of derivatives associated with customer interest rate swaps and related collateral received from counterparties.

    Capital levels remain strong and in excess of “well-capitalized” regulatory levels at March 31, 2025, including the Company’s estimated common equity tier one capital ratio which remained at 11.2%.

    Total stockholders’ equity increased to $1.71 billion, as compared to $1.70 billion, primarily reflecting net income, partially offset by capital returns comprising of dividends and share repurchases. During the quarter ended March 31, 2025, the Company repurchased 398,395 shares totaling $6.9 million representing a weighted average cost of $17.20. The Company had 1,228,863 shares available for repurchase under the authorized repurchase program. Additionally, accumulated other comprehensive loss decreased by $2.6 million primarily due to increases in fair market value of available-for-sale debt securities, net of tax.

    The Company’s tangible common equity2 increased by $7.3 million to $1.12 billion. The Company’s stockholders’ equity to assets ratio was 12.84% at March 31, 2025, and tangible common equity to tangible assets ratio increased by 14 basis points during the quarter to 8.76%, primarily due to the drivers described above.

    Book value per common share increased to $29.27, as compared to $29.08. Tangible book value per common share2 increased to $19.16, as compared to $18.98.

    2 Tangible book value per common share and tangible common equity to tangible assets are non-GAAP financial measures and exclude the impact of intangible assets, goodwill, and preferred equity from both stockholders’ equity and total assets. Refer to “Explanation of Non-GAAP Financial Measures” and the “Non-GAAP Reconciliation” tables for additional information regarding non-GAAP financial measures.

    Asset Quality

    March 31, 2025 vs. December 31, 2024

    The Company’s non-performing loans increased to $37.0 million, from $35.5 million, and represented 0.37% and 0.35% of total loans, respectively. The allowance for loan credit losses as a percentage of total non-performing loans was 213.14%, as compared to 207.19%. The level of 30 to 89 days delinquent loans increased to $46.2 million, from $36.6 million, primarily related to commercial loans. Criticized and classified assets, including other real estate owned, decreased to $151.2 million, from $159.9 million. The Company’s allowance for loan credit losses was 0.78% of total loans, as compared to 0.73%. Refer to “Provision for Credit Losses” section for further discussion.

    The Company’s asset quality, excluding purchased with credit deterioration (“PCD”) loans, was as follows. Non-performing loans increased to $29.2 million, from $27.6 million. The allowance for loan credit losses as a percentage of total non-performing loans was 269.43%, as compared to 266.73%. The level of 30 to 89 days delinquent loans, excluding non-performing loans, increased to $35.8 million, from $33.6 million.

    Explanation of Non-GAAP Financial Measures

    Reported amounts are presented in accordance with GAAP. The Company’s management believes that the supplemental non-GAAP information, which consists of reported net income excluding non-core operations and in some instances excluding income taxes and provision for credit losses, and reporting equity and asset amounts excluding intangible assets, goodwill or preferred stock, all of which can vary from period to period, provides a better comparison of period-to-period operating performance. Additionally, the Company believes this information is utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures, which may be presented by other companies. Refer to the Non-GAAP Reconciliation table at the end of this document for details on the earnings impact of these items.

    Annual Meeting

    The Company previously announced that its Annual Meeting of Stockholders will be held on Monday, May 19, 2025 at 8:00 a.m. Eastern Time. The record date for stockholders to vote at the Annual Meeting is Tuesday, March 25, 2025. Voting before the meeting is encouraged, even for stockholders planning to participate in the virtual webcast. Votes may be submitted by telephone or online according to the instructions on the proxy card or by mail. A link to the live webcast is available by visiting oceanfirst.com – Investor Relations. Access will begin at 7:45 a.m. Eastern Time to allow time for stockholders to log-in with the control number provided on the proxy card prior to the 8:00 a.m. Eastern Time scheduled start. Eligible stockholders may also vote during the live meeting online at www.virtualshareholdermeeting.com/OCFC2025 by entering the 16-digit control number included on the proxy card or notice. As a reminder, participants of the meeting are not required to vote. Additional information regarding virtual access to the meeting will be distributed prior to the meeting.

    Conference Call

    As previously announced, the Company will host an earnings conference call on Friday, April 25, 2025 at 11:00 a.m. Eastern Time. The direct dial number for the call is (833) 470-1428, using the access code 934356. For those unable to participate in the conference call, a replay will be available. To access the replay, dial (855) 762-8306, from one hour after the end of the call until May 2, 2025. The conference call, as well as the replay, are also available (listen-only) by internet webcast at www.oceanfirst.com in the Investor Relations section.

    OceanFirst Financial Corp.’s subsidiary, OceanFirst Bank N.A., founded in 1902, is a $13.3 billion regional bank providing financial services throughout New Jersey and in the major metropolitan areas between Massachusetts and Virginia. OceanFirst Bank delivers commercial and residential financing, treasury management, trust and asset management, and deposit services and is one of the largest and oldest community-based financial institutions headquartered in New Jersey. To learn more about OceanFirst, go to www.oceanfirst.com

    Forward-Looking Statements

    In addition to historical information, this news release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are based on certain assumptions and describe future plans, strategies and expectations of the Company. These forward-looking statements are generally identified by use of the words “believe”, “expect”, “intend”, “anticipate”, “estimate”, “project”, “will”, “should”, “may”, “view”, “opportunity”, “potential”, or similar expressions or expressions of confidence. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to: changes in interest rates, inflation, general economic conditions, including potential recessionary conditions, levels of unemployment in the Company’s lending area, real estate market values in the Company’s lending area, potential goodwill impairment, natural disasters, potential increases to flood insurance premiums, the current or anticipated impact of military conflict, terrorism or other geopolitical events, the imposition of tariffs or other domestic or international governmental policies, the level of prepayments on loans and mortgage-backed securities, legislative/regulatory changes, monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System, the quality or composition of the loan or investment portfolios, demand for loan products, deposit flows, the availability of low-cost funding, changes in liquidity, including the size and composition of the Company’s deposit portfolio, and the percentage of uninsured deposits in the portfolio, changes in capital management and balance sheet strategies and the ability to successfully implement such strategies, competition, demand for financial services in the Company’s market area, changes in consumer spending, borrowing and saving habits, changes in accounting principles, a failure in or breach of the Company’s operational or security systems or infrastructure, including cyberattacks, the failure to maintain current technologies, failure to retain or attract employees, the impact of pandemics on our operations and financial results and those of our customers and the Bank’s ability to successfully integrate acquired operations. These risks and uncertainties are further discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, under Item 1A – Risk Factors and elsewhere, and subsequent securities filings and should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

     
    OceanFirst Financial Corp.
    CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
    (dollars in thousands)
     
        March 31,   December 31,   March 31,
          2025       2024       2024  
        (Unaudited)       (Unaudited)
    Assets            
    Cash and due from banks   $ 163,721     $ 123,615     $ 130,422  
    Debt securities available-for-sale, at estimated fair value     746,168       827,500       744,944  
    Debt securities held-to-maturity, net of allowance for securities credit losses of $898 at March 31, 2025, $967 at December 31, 2024, and $1,058 at March 31, 2024 (estimated fair value of $926,075 at March 31, 2025, $952,917 at December 31, 2024, and $1,029,965 at March 31, 2024)     1,005,476       1,045,875       1,128,666  
    Equity investments     87,365       84,104       103,201  
    Restricted equity investments, at cost     102,172       108,634       85,689  
    Loans receivable, net of allowance for loan credit losses of $78,798 at March 31, 2025, $73,607 at December 31, 2024, and $67,173 at March 31, 2024     10,058,072       10,055,429       10,068,209  
    Loans held-for-sale     9,698       21,211       4,702  
    Interest and dividends receivable     44,843       45,914       52,502  
    Other real estate owned     1,917       1,811        
    Premises and equipment, net     114,588       115,256       119,211  
    Bank owned life insurance     269,398       270,208       266,615  
    Assets held for sale                 28  
    Goodwill     523,308       523,308       506,146  
    Intangibles     11,740       12,680       8,669  
    Other assets     170,812       185,702       199,974  
    Total assets   $ 13,309,278     $ 13,421,247     $ 13,418,978  
    Liabilities and Stockholders’ Equity            
    Deposits   $ 10,177,023     $ 10,066,342     $ 10,236,851  
    Federal Home Loan Bank advances     891,021       1,072,611       658,436  
    Securities sold under agreements to repurchase with customers     65,132       60,567       66,798  
    Other borrowings     197,808       197,546       425,722  
    Advances by borrowers for taxes and insurance     28,789       23,031       28,187  
    Other liabilities     240,388       298,393       337,147  
    Total liabilities     11,600,161       11,718,490       11,753,141  
    Stockholders’ equity:            
    OceanFirst Financial Corp. stockholders’ equity     1,708,322       1,701,650       1,665,112  
    Non-controlling interest     795       1,107       725  
    Total stockholders’ equity     1,709,117       1,702,757       1,665,837  
    Total liabilities and stockholders’ equity   $ 13,309,278     $ 13,421,247     $ 13,418,978  
    OceanFirst Financial Corp.
    CONSOLIDATED STATEMENTS OF INCOME
    (in thousands, except per share amounts)
     
        For the Three Months Ended,
        March 31,   December 31,   March 31,
          2025       2024       2024  
        |———————- (Unaudited) ———————-|
    Interest income:            
    Loans   $ 133,019     $ 135,438     $ 137,121  
    Debt securities     17,270       19,400       19,861  
    Equity investments and other     3,414       4,782       4,620  
    Total interest income     153,703       159,620       161,602  
    Interest expense:            
    Deposits     51,046       59,889       59,855  
    Borrowed funds     16,005       16,402       15,523  
    Total interest expense     67,051       76,291       75,378  
    Net interest income     86,652       83,329       86,224  
    Provision for credit losses     5,340       3,467       591  
    Net interest income after provision for credit losses     81,312       79,862       85,633  
    Other income:            
    Bankcard services revenue     1,463       1,595       1,416  
    Trust and asset management revenue     406       416       526  
    Fees and service charges     4,712       6,207       4,473  
    Net gain on sales of loans     858       1,076       357  
    Net gain (loss) on equity investments     205       (5 )     1,923  
    Net loss from other real estate operations     (16 )     (20 )      
    Income from bank owned life insurance     1,852       2,538       1,862  
    Commercial loan swap income     620       86       138  
    Other     1,153       339       1,591  
    Total other income     11,253       12,232       12,286  
    Operating expenses:            
    Compensation and employee benefits     36,740       36,602       32,759  
    Occupancy     5,497       5,280       5,199  
    Equipment     921       1,026       1,130  
    Marketing     1,108       1,615       990  
    Federal deposit insurance and regulatory assessments     2,983       2,517       3,135  
    Data processing     6,647       6,366       5,956  
    Check card processing     1,170       1,134       1,050  
    Professional fees     2,425       2,620       2,732  
    Amortization of intangibles     940       876       844  
    Merger related expenses           110        
    Other operating expense     5,863       6,703       4,877  
    Total operating expenses     64,294       64,849       58,672  
    Income before provision for income taxes     28,271       27,245       39,247  
    Provision for income taxes     6,808       5,083       10,637  
    Net income     21,463       22,162       28,610  
    Net (loss) income attributable to non-controlling interest     (46 )     253       (57 )
    Net income attributable to OceanFirst Financial Corp.     21,509       21,909       28,667  
    Dividends on preferred shares     1,004       1,004       1,004  
    Net income available to common stockholders   $ 20,505     $ 20,905     $ 27,663  
    Basic earnings per share   $ 0.35     $ 0.36     $ 0.47  
    Diluted earnings per share   $ 0.35     $ 0.36     $ 0.47  
    Average basic shares outstanding     58,102       58,026       58,789  
    Average diluted shares outstanding     58,111       58,055       58,791  
    OceanFirst Financial Corp.
    SELECTEDLOANAND DEPOSIT DATA
    (dollars in thousands)
     
    LOANS RECEIVABLE   At
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Commercial:                    
    Commercial real estate – investor   $ 5,200,137     $ 5,287,683     $ 5,273,159     $ 5,324,994     $ 5,322,755  
    Commercial and industrial:                    
    Commercial and industrial – real estate (1)     896,647       902,219       841,930       857,710       914,582  
    Commercial and industrial – non-real estate (1)     748,575       647,945       660,879       616,400       677,176  
    Total commercial and industrial     1,645,222       1,550,164       1,502,809       1,474,110       1,591,758  
        Total commercial     6,845,359       6,837,847       6,775,968       6,799,104       6,914,513  
    Consumer:                    
    Residential real estate     3,053,318       3,049,763       3,003,213       2,977,698       2,965,276  
    Home equity loans and lines and other consumer (“other consumer”)     226,633       230,462       242,975       242,526       245,859  
        Total consumer     3,279,951       3,280,225       3,246,188       3,220,224       3,211,135  
        Total loans     10,125,310       10,118,072       10,022,156       10,019,328       10,125,648  
    Deferred origination costs (fees), net     11,560       10,964       10,508       10,628       9,734  
    Allowance for loan credit losses     (78,798 )     (73,607 )     (69,066 )     (68,839 )     (67,173 )
        Loans receivable, net   $ 10,058,072     $ 10,055,429     $ 9,963,598     $ 9,961,117     $ 10,068,209  
    Mortgage loans serviced for others   $ 222,963     $ 191,279     $ 142,394     $ 104,136     $ 89,555  
      At March 31, 2025 Average Yield                    
    Loan pipeline (2):                      
    Commercial 7.37 %   $ 375,622     $ 197,491     $ 199,818     $ 166,206     $ 66,167  
    Residential real estate 6.41       116,121       97,385       137,978       80,330       57,340  
    Other consumer 8.51       12,681       11,783       13,788       12,586       13,030  
    Total 7.18 %   $ 504,424     $ 306,659     $ 351,584     $ 259,122     $ 136,537  
      For the Three Months Ended
      March 31,   December 31,   September 30,   June 30,   March 31,
      2025     2024       2024       2024       2024  
      Average Yield                    
    Loan originations:                      
    Commercial (3) 7.61 %   $ 233,968     $ 268,613     $ 245,886     $ 56,053     $ 123,010  
    Residential real estate 6.53       167,162       235,370       169,273       121,388       78,270  
    Other consumer 8.49       15,825       11,204       15,760       16,970       11,405  
    Total 7.21 %   $ 416,955     $ 515,187     $ 430,919     $ 194,411     $ 212,685  
    Loans sold     $ 104,991    (4) $ 127,508     $ 65,296     $ 45,045     $ 29,965  
    (1) During the quarter ended March 31, 2025, the Company retrospectively reclassified loans which were previously referred to as ‘commercial real estate – owner occupied’ and ‘commercial and industrial’ to ‘commercial and industrial – real estate’ and ‘commercial and industrial – non-real estate’, respectively. Collectively, these loans are referred to as ‘commercial and industrial’.
    (2) Loan pipeline includes loans approved but not funded.
    (3) Excludes commercial loan pool purchases of $24.3 million and $76.1 million for the three months ended March 31, 2025 and December 31, 2024, respectively.
    (4) Excludes sale of non-performing residential and consumer loans of $5.1 million for the three months ended March 31, 2025.

     

    DEPOSITS   At
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Type of Account                    
    Non-interest-bearing   $ 1,660,738     $ 1,617,182     $ 1,638,447     $ 1,632,521     $ 1,639,828  
    Interest-bearing checking     4,006,653       4,000,553       3,896,348       3,667,837       3,865,699  
    Money market     1,337,570       1,301,197       1,288,555       1,210,312       1,150,979  
    Savings     1,052,504       1,066,438       1,071,946       1,115,688       1,260,309  
    Time deposits (1)     2,119,558       2,080,972       2,220,871       2,367,659       2,320,036  
    Total deposits   $ 10,177,023     $ 10,066,342     $ 10,116,167     $ 9,994,017     $ 10,236,851  
    (1) Includes brokered time deposits of $370.5 million, $74.7 million, $201.0 million, $401.6 million, and $543.4 million at March 31, 2025, December 31, 2024, September 30, 2024, June 30, 2024, and March 31, 2024, respectively.

     

    OceanFirst Financial Corp.
    ASSET QUALITY
    (dollars in thousands)
     
        March 31,   December 31,   September 30,   June 30,   March 31,
    ASSET QUALITY(1)     2025       2024       2024       2024       2024  
    Non-performing loans:                    
    Commercial real estate – investor   $ 23,595     $ 17,000     $ 12,478     $ 19,761     $ 21,507  
    Commercial and industrial:                    
    Commercial and industrial – real estate     4,690       4,787       4,368       4,081       3,355  
    Commercial and industrial – non-real estate     22       32       122       434       567  
    Total commercial and industrial     4,712       4,819       4,490       4,515       3,922  
    Residential real estate     5,709       10,644       9,108       7,213       7,181  
    Other consumer     2,954       3,064       2,063       1,933       2,401  
    Total non-performing loans(1)   $ 36,970     $ 35,527     $ 28,139     $ 33,422     $ 35,011  
    Other real estate owned     1,917       1,811                    
    Total non-performing assets   $ 38,887     $ 37,338     $ 28,139     $ 33,422     $ 35,011  
    Delinquent loans 30 to 89 days   $ 46,246     $ 36,550     $ 15,458     $ 9,655     $ 17,534  
    Modifications to borrowers experiencing financial difficulty(2)                    
    Non-performing (included in total non-performing loans above)   $ 8,307     $ 3,232     $ 3,043     $ 3,210     $ 3,467  
    Performing     27,592       27,631       20,652       20,529       8,579  
    Total modifications to borrowers experiencing financial difficulty(2)   $ 35,899     $ 30,863     $ 23,695     $ 23,739     $ 12,046  
    Allowance for loan credit losses   $ 78,798     $ 73,607     $ 69,066     $ 68,839     $ 67,173  
    Allowance for loan credit losses as a percent of total loans receivable(3)     0.78 %     0.73 %     0.69 %     0.69 %     0.66 %
    Allowance for loan credit losses as a percent of total non-performing loans(3)     213.14       207.19       245.45       205.97       191.86  
    Non-performing loans as a percent of total loans receivable     0.37       0.35       0.28       0.33       0.35  
    Non-performing assets as a percent of total assets     0.29       0.28       0.21       0.25       0.26  
    Supplemental PCD and non-performing loans                    
    PCD loans, net of allowance for loan credit losses   $ 21,737     $ 22,006     $ 15,323     $ 16,058     $ 16,700  
    Non-performing PCD loans     7,724       7,931       2,887       2,841       3,525  
    Delinquent PCD and non-performing loans 30 to 89 days     10,489       2,997       1,279       1,188       2,088  
    PCD modifications to borrowers experiencing financial difficulty(2)     22       23       24       26       25  
    Asset quality, excluding PCD loans(4)                    
    Non-performing loans(1)     29,246       27,596       25,252       30,581       31,486  
    Non-performing assets     31,163       29,407       25,252       30,581       31,486  
    Delinquent loans 30 to 89 days (excludes non-performing loans)     35,757       33,553       14,179       8,467       15,446  
    Modifications to borrowers experiencing financial difficulty(2)     35,877       30,840       23,671       23,713       12,021  
    Allowance for loan credit losses as a percent of total non-performing loans(3)     269.43 %     266.73 %     273.51 %     225.10 %     213.34 %
    Non-performing loans as a percent of total loans receivable     0.29       0.27       0.25       0.31       0.31  
    Non-performing assets as a percent of total assets     0.23       0.22       0.19       0.23       0.23  
    (1) The quarter ended March 31, 2025 included the sale of non-performing residential and consumer loans of $5.1 million and the quarter ended September 30, 2024 included the resolution of a single commercial relationship exposure of $7.2 million.
    (2) Balances have been revised to represent only modifications to borrowers experiencing financial difficulty, in accordance with ASU 2022-02 adopted on January 1, 2023.
    (3) Loans acquired from acquisitions were recorded at fair value. The net unamortized credit and PCD marks on these loans, not reflected in the allowance for loan credit losses, was $5.6 million, $6.0 million, $5.7 million, $6.1 million and $7.0 million at March 31, 2025, December 31, 2024, September 30, 2024, June 30, 2024, and March 31, 2024, respectively.
    (4) All balances and ratios exclude PCD loans.
    NET LOAN (CHARGE-OFFS) RECOVERIES   For the Three Months Ended
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Net loan (charge-offs) recoveries:                    
    Loan charge-offs   $ (798 )   $ (55 )   $ (124 )   $ (1,600 )   $ (441 )
    Recoveries on loans     162       213       212       148       92  
    Net loan (charge-offs) recoveries   $ (636 )   $ 158     $ 88     $ (1,452 )   $ (349 )
    Net loan (charge-offs) recoveries to average total loans (annualized)     0.03 %     NM *     NM *     0.06 %     0.01 %
    Net loan (charge-offs) recoveries detail:                    
    Commercial   $ 25     $ 92     $ 129     $ (1,576 ) (1) $ (35 )
    Residential real estate     (720 ) (2)   (17 )     (6 )     87       66  
    Other consumer     59       83       (35 )     37       (380 )
    Net loan (charge-offs) recoveries   $ (636 )   $ 158     $ 88     $ (1,452 )   $ (349 )
    (1) The three months ended June 30, 2024 included a charge-off related to a single commercial real estate relationship of $1.6 million.
    (2) The three months ended March 31, 2025 included charge-offs of $720,000 related to the sale of non-performing residential loans.
    * Not meaningful as amounts are net loan recoveries.

     

    OceanFirst Financial Corp.
    ANALYSIS OF NET INTEREST INCOME
     
        For the Three Months Ended
        March 31, 2025   December 31, 2024   March 31, 2024
    (dollars in thousands)   Average
    Balance
      Interest   Average
    Yield/
    Cost (1)
      Average
    Balance
      Interest   Average
    Yield/
    Cost (1)
      Average
    Balance
      Interest   Average
    Yield/
    Cost (1)
    Assets:                                    
    Interest-earning assets:                                    
    Interest-earning deposits and short-term investments   $ 95,439     $ 983   4.18 %   $ 195,830     $ 2,415   4.91 %   $ 163,192     $ 2,226   5.49 %
    Securities (2)     2,003,206       19,701   3.99       2,116,911       21,767   4.09       2,098,421       22,255   4.27  
    Loans receivable, net (3)                                    
    Commercial     6,781,005       98,260   5.88       6,794,158       101,003   5.91       6,925,048       104,421   6.06  
    Residential real estate     3,065,679       31,270   4.08       3,049,092       30,455   4.00       2,974,468       28,596   3.85  
    Other consumer     228,553       3,489   6.19       236,161       3,980   6.70       248,396       4,104   6.65  
    Allowance for loan credit losses, net of deferred loan costs and fees     (61,854 )             (60,669 )             (59,141 )        
    Loans receivable, net     10,013,383       133,019   5.37       10,018,742       135,438   5.38       10,088,771       137,121   5.46  
    Total interest-earning assets     12,112,028       153,703   5.13       12,331,483       159,620   5.15       12,350,384       161,602   5.26  
    Non-interest-earning assets     1,199,865               1,213,569               1,206,336          
    Total assets   $ 13,311,893             $ 13,545,052             $ 13,556,720          
    Liabilities and Stockholders’ Equity:                                    
    Interest-bearing liabilities:                                    
    Interest-bearing checking   $ 4,135,952       21,433   2.10 %   $ 4,050,428       22,750   2.23 %   $ 3,925,965       20,795   2.13 %
    Money market     1,322,003       9,353   2.87       1,325,119       10,841   3.25       1,092,003       9,172   3.38  
    Savings     1,058,015       1,785   0.68       1,070,816       2,138   0.79       1,355,718       4,462   1.32  
    Time deposits     1,916,109       18,475   3.91       2,212,750       24,160   4.34       2,414,063       25,426   4.24  
    Total     8,432,079       51,046   2.46       8,659,113       59,889   2.75       8,787,749       59,855   2.74  
    FHLB Advances     996,293       11,359   4.62       854,748       10,030   4.67       644,818       7,771   4.85  
    Securities sold under agreements to repurchase     64,314       428   2.70       76,856       513   2.66       68,500       411   2.41  
    Other borrowings     283,150       4,218   6.04       396,412       5,859   5.88       500,901       7,341   5.89  
    Total borrowings     1,343,757       16,005   4.83       1,328,016       16,402   4.91       1,214,219       15,523   5.14  
    Total interest-bearing liabilities     9,775,836       67,051   2.78       9,987,129       76,291   3.04       10,001,968       75,378   3.03  
    Non-interest-bearing deposits     1,597,972               1,627,376               1,634,583          
    Non-interest-bearing liabilities     222,951               227,221               247,129          
    Total liabilities     11,596,759               11,841,726               11,883,680          
    Stockholders’ equity     1,715,134               1,703,326               1,673,040          
    Total liabilities and equity   $ 13,311,893             $ 13,545,052             $ 13,556,720          
    Net interest income       $ 86,652           $ 83,329           $ 86,224    
    Net interest rate spread (4)           2.35 %           2.11 %           2.23 %
    Net interest margin (5)           2.90 %           2.69 %           2.81 %
    Total cost of deposits (including non-interest-bearing deposits)           2.06 %           2.32 %           2.31 %
    (1) Average yields and costs are annualized.
    (2) Amounts represent debt and equity securities, including FHLB and Federal Reserve Bank stock, and are recorded at average amortized cost, net of allowance for securities credit losses.
    (3) Amount is net of deferred loan costs and fees, undisbursed loan funds, discounts and premiums and allowance for loan credit losses, and includes loans held for sale and non-performing loans.
    (4) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
    (5) Net interest margin represents net interest income divided by average interest-earning assets.

     

    OceanFirst Financial Corp.
    SELECTED QUARTERLY FINANCIAL DATA
    (in thousands, except per share amounts)
     
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Selected Financial Condition Data:                    
    Total assets   $ 13,309,278     $ 13,421,247     $ 13,488,483     $ 13,321,755     $ 13,418,978  
    Debt securities available-for-sale, at estimated fair value     746,168       827,500       911,753       721,484       744,944  
    Debt securities held-to-maturity, net of allowance for securities credit losses     1,005,476       1,045,875       1,075,131       1,105,843       1,128,666  
    Equity investments     87,365       84,104       95,688       104,132       103,201  
    Restricted equity investments, at cost     102,172       108,634       98,545       92,679       85,689  
    Loans receivable, net of allowance for loan credit losses     10,058,072       10,055,429       9,963,598       9,961,117       10,068,209  
    Deposits     10,177,023       10,066,342       10,116,167       9,994,017       10,236,851  
    Federal Home Loan Bank advances     891,021       1,072,611       891,860       789,337       658,436  
    Securities sold under agreements to repurchase and other borrowings     262,940       258,113       501,090       504,490       492,520  
    Total stockholders’ equity     1,709,117       1,702,757       1,694,508       1,676,669       1,665,837  
        For the Three Months Ended,
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Selected Operating Data:                    
    Interest income   $ 153,703     $ 159,620     $ 161,525     $ 159,426     $ 161,602  
    Interest expense     67,051       76,291       79,306       77,163       75,378  
    Net interest income     86,652       83,329       82,219       82,263       86,224  
    Provision for credit losses (excluding Spring Garden)     5,340       2,041       517       3,114       591  
    Spring Garden opening provision for credit losses           1,426                    
    Net interest income after provision for credit losses     81,312       79,862       81,702       79,149       85,633  
    Other income (excluding equity investments and sale of trust)     11,048       12,237       11,826       10,098       9,201  
    Net gain (loss) on equity investments     205       (5 )     1,420       887       1,923  
    Net gain on sale of trust business                 1,438             1,162  
    Operating expenses (excluding FDIC special assessment and merger related expenses)     64,294       64,739       62,067       58,620       58,254  
    FDIC special assessment                             418  
    Merger related expenses           110       1,669              
    Income before provision for income taxes     28,271       27,245       32,650       31,514       39,247  
    Provision for income taxes     6,808       5,083       7,464       7,082       10,637  
    Net income     21,463       22,162       25,186       24,432       28,610  
    Net (loss) income attributable to non-controlling interest     (46 )     253       70       59       (57 )
    Net income attributable to OceanFirst Financial Corp.   $ 21,509     $ 21,909     $ 25,116     $ 24,373     $ 28,667  
    Net income available to common stockholders   $ 20,505     $ 20,905     $ 24,112     $ 23,369     $ 27,663  
    Diluted earnings per share   $ 0.35     $ 0.36     $ 0.42     $ 0.40     $ 0.47  
    Net accretion/amortization of purchase accounting adjustments included in net interest income   $ 219     $ 20     $ 741     $ 1,086     $ 921  
        At or For the Three Months Ended
        March 31,   December 31,   September 30,   June 30,   March 31,
        2025   2024   2024   2024   2024
    Selected Financial Ratios and Other Data (1) (2):                    
    Performance Ratios (Annualized):                    
    Return on average assets (3)   0.62 %   0.61 %   0.71 %   0.70 %   0.82 %
    Return on average tangible assets (3) (4)   0.65     0.64     0.74     0.73     0.85  
    Return on average stockholders’ equity (3)   4.85     4.88     5.68     5.61     6.65  
    Return on average tangible stockholders’ equity (3) (4)   7.05     7.12     8.16     8.10     9.61  
    Return on average tangible common equity (3) (4)   7.40     7.47     8.57     8.51     10.09  
    Stockholders’ equity to total assets   12.84     12.69     12.56     12.59     12.41  
    Tangible stockholders’ equity to tangible assets (4)   9.19     9.06     9.10     9.08     8.92  
    Tangible common equity to tangible assets (4)   8.76     8.62     8.68     8.64     8.49  
    Net interest rate spread   2.35     2.11     2.06     2.11     2.23  
    Net interest margin   2.90     2.69     2.67     2.71     2.81  
    Operating expenses to average assets   1.96     1.90     1.89     1.75     1.74  
    Efficiency ratio (5)   65.67     67.86     65.77     62.86     59.56  
    Loan-to-deposit ratio   99.50     100.50     99.10     100.30     98.90  
        At or For the Three Months Ended
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Trust and Asset Management:                    
    Wealth assets under administration and management (“AUA/M”)   $ 149,106     $ 147,956     $ 152,797     $ 150,519     $ 236,891  
    Nest Egg AUA/M     453,803       431,434       430,413       403,647       407,478  
    Total AUA/M     602,909       579,390       583,210       554,166       644,369  
    Per Share Data:                    
    Cash dividends per common share   $ 0.20     $ 0.20     $ 0.20     $ 0.20     $ 0.20  
    Book value per common share at end of period     29.27       29.08       29.02       28.67       28.32  
    Tangible book value per common share at end of period (4)     19.16       18.98       19.28       18.93       18.63  
    Common shares outstanding at end of period     58,383,525       58,554,871       58,397,094       58,481,418       58,812,498  
    Preferred shares outstanding at end of period     57,370       57,370       57,370       57,370       57,370  
    Number of full-service customer facilities:     39       39       39       39       39  
    Quarterly Average Balances                    
    Total securities   $ 2,003,206     $ 2,116,911     $ 2,063,633     $ 2,058,711     $ 2,098,421  
    Loans receivable, net     10,013,383       10,018,742       9,958,794       10,012,491       10,088,771  
    Total interest-earning assets     12,112,028       12,331,483       12,232,672       12,203,776       12,350,384  
    Total goodwill and intangibles     535,657       534,942       513,731       514,535       515,356  
    Total assets     13,311,893       13,545,052       13,438,696       13,441,218       13,556,720  
    Time deposits     1,916,109       2,212,750       2,339,370       2,337,458       2,414,063  
    Total deposits (including non-interest-bearing deposits)     10,030,051       10,286,489       10,175,856       10,173,315       10,422,332  
    Total borrowings     1,343,757       1,328,016       1,333,245       1,325,372       1,214,219  
    Total interest-bearing liabilities     9,775,836       9,987,129       9,874,358       9,872,522       10,001,968  
    Non-interest bearing deposits     1,597,972       1,627,376       1,634,743       1,626,165       1,634,583  
    Stockholders’ equity     1,715,134       1,703,326       1,689,035       1,674,453       1,673,040  
    Tangible stockholders’ equity (4)     1,179,477       1,168,384       1,175,304       1,159,918       1,157,684  
                         
    Quarterly Yields and Costs                    
    Total securities     3.99 %     4.09 %     4.23 %     4.22 %     4.27 %
    Loans receivable, net     5.37       5.38       5.46       5.46       5.46  
    Total interest-earning assets     5.13       5.15       5.26       5.25       5.26  
    Time deposits     3.91       4.34       4.58       4.46       4.24  
    Total cost of deposits (including non-interest-bearing deposits)     2.06       2.32       2.44       2.37       2.31  
    Total borrowed funds     4.83       4.91       5.07       5.19       5.14  
    Total interest-bearing liabilities     2.78       3.04       3.20       3.14       3.03  
    Net interest spread     2.35       2.11       2.06       2.11       2.23  
    Net interest margin     2.90       2.69       2.67       2.71       2.81  
    (1) With the exception of end of quarter ratios, all ratios are based on average daily balances.
    (2) Performance ratios for each period are presented on a GAAP basis and include non-core operations. Refer to “Non-GAAP Reconciliation.”
    (3) Ratios for each period are based on net income available to common stockholders.
    (4) Tangible stockholders’ equity and tangible assets exclude goodwill and other intangibles. Tangible common equity (also referred to as “tangible book value”) excludes goodwill, intangibles and preferred equity. Refer to “Non-GAAP Reconciliation.”
    (5) Efficiency ratio represents the ratio of operating expenses to the aggregate of other income and net interest income.
    OceanFirst Financial Corp.
    OTHER ITEMS
    (dollars in thousands, except per share amounts)
     
    NON-GAAP RECONCILIATION
     
        For the Three Months Ended
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Core Earnings:                    
    Net income available to common stockholders (GAAP)   $ 20,505     $ 20,905     $ 24,112     $ 23,369     $ 27,663  
    (Less) add non-recurring and non-core items:                    
    Spring Garden opening provision for credit losses           1,426                    
    Net (gain) loss on equity investments     (205 )     5       (1,420 )     (887 )     (1,923 )
    Net gain on sale of trust business                 (1,438 )           (1,162 )
    FDIC special assessment                             418  
    Merger related expenses           110       1,669              
    Income tax expense (benefit) on items     49       (388 )     270       188       642  
    Core earnings (Non-GAAP)   $ 20,349     $ 22,058     $ 23,193     $ 22,670     $ 25,638  
    Income tax expense   $ 6,808     $ 5,083     $ 7,464     $ 7,082     $ 10,637  
    Provision for credit losses     5,340       3,467       517       3,114       591  
    Less: non-core provision for credit losses           1,426                    
    Less: income tax expense (benefit) on non-core items     49       (388 )     270       188       642  
    Core earnings PTPP (Non-GAAP)   $ 32,448     $ 29,570     $ 30,904     $ 32,678     $ 36,224  
    Core earnings diluted earnings per share   $ 0.35     $ 0.38     $ 0.39     $ 0.39     $ 0.44  
    Core earnings PTPP diluted earnings per share   $ 0.56     $ 0.51     $ 0.53     $ 0.56     $ 0.62  
                         
    Core Ratios (Annualized):                    
    Return on average assets     0.62 %     0.65 %     0.69 %     0.68 %     0.76 %
    Return on average tangible stockholders’ equity     7.00       7.51       7.85       7.86       8.91  
    Return on average tangible common equity     7.34       7.89       8.24       8.26       9.36  
    Efficiency ratio     65.81       67.74       66.00       63.47       61.05  
        March 31,   December 31,   September 30,   June 30,   March 31,
          2025       2024       2024       2024       2024  
    Tangible Equity:                    
    Total stockholders’ equity   $ 1,709,117     $ 1,702,757     $ 1,694,508     $ 1,676,669     $ 1,665,837  
    Less:                    
    Goodwill     523,308       523,308       506,146       506,146       506,146  
    Intangibles     11,740       12,680       7,056       7,859       8,669  
    Tangible stockholders’ equity     1,174,069       1,166,769       1,181,306       1,162,664       1,151,022  
    Less:                    
    Preferred stock     55,527       55,527       55,527       55,527       55,527  
    Tangible common equity   $ 1,118,542     $ 1,111,242     $ 1,125,779     $ 1,107,137     $ 1,095,495  
                         
    Tangible Assets:                    
    Total assets   $ 13,309,278     $ 13,421,247     $ 13,488,483     $ 13,321,755     $ 13,418,978  
    Less:                    
    Goodwill     523,308       523,308       506,146       506,146       506,146  
    Intangibles     11,740       12,680       7,056       7,859       8,669  
    Tangible assets   $ 12,774,230     $ 12,885,259     $ 12,975,281     $ 12,807,750     $ 12,904,163  
                         
    Tangible stockholders’ equity to tangible assets     9.19 %     9.06 %     9.10 %     9.08 %     8.92 %
    Tangible common equity to tangible assets     8.76 %     8.62 %     8.68 %     8.64 %     8.49 %


    C
    ompany Contact:

    Patrick S. Barrett
    Chief Financial Officer
    OceanFirst Financial Corp.
    Tel: (732) 240-4500, ext. 27507
    Email: pbarrett@oceanfirst.com

    The MIL Network

  • MIL-OSI USA: Padilla Joins Federal and State Emergency Officials to Survey Pacific Palisades Fire Recovery Area; Highlights Bipartisan Legislation to Address Wildfire Risks

    US Senate News:

    Source: United States Senator Alex Padilla (D-Calif.)

    Padilla Joins Federal and State Emergency Officials to Survey Pacific Palisades Fire Recovery Area; Highlights Bipartisan Legislation to Address Wildfire Risks

    WATCH: Padilla discusses importance of bipartisan solutions like the Senate Fix Our Forests Act to combat wildfire crisisLOS ANGELES, CA — Just over 100 days after the Los Angeles fires first ignited, U.S. Senator Alex Padilla (D-Calif.) and California Natural Resources Secretary Wade Crowfoot joined federal and state emergency officials for a tour today of the Pacific Palisades fire recovery area led by the Federal Emergency Management Agency (FEMA). The tour consisted of a visit to businesses and residences impacted by the Pacific Palisades fire — with officials from FEMA, the U.S. Army Corps of Engineers (USACE), CAL FIRE, and the California Governor’s Office of Emergency Services (Cal OES) — followed by a press conference at a cleared debris site where Padilla discussed his new bipartisan legislation to address wildfire risks.
    In the aftermath of the devastating Southern California fires, Padilla’s Fix Our Forests Act would help combat catastrophic wildfires, restore forest ecosystems, and make federal forest management more efficient and responsive. The comprehensive Senate bill reflects months of bipartisan Senate negotiations to find consensus on how to best improve forest management practices, accelerate processes to protect communities, advance watershed restoration, and strengthen partnerships between federal agencies, states, tribes, and private stakeholders. The Senate version of the bill would also bolster coordination efforts across agencies through a new Wildfire Intelligence Center, which would streamline the federal response and create a whole-of-government approach to combating wildfires.
    A list of Senate Fix Our Forests Act provisions particularly impactful for California is available here. A one-pager on the bill is available here.
    “As thousands of Los Angeles families look at a long road to recovery ahead, we need to do everything in our power not just to rebuild, but to prevent devastation from future wildfires,” said Senator Padilla. “That’s why with these LA communities in mind, I convened a bipartisan group of Western Senators to reassess how we prevent and respond to wildfires. Our Senate version of the Fix Our Forests Act would increase the speed and scale of our wildfire prevention and mitigation efforts by expediting the removal of hazardous fuels, building ‘fuel breaks’ to stop mega wildfires, and creating a National Wildfire Intelligence Center to streamline federal response. We’re breaking through this harsh political climate with bipartisan solutions to both fight deadly wildfires and prevent even more greenhouse gas emissions — we can’t take this opportunity for granted.”
    “The bipartisan Fix Our Forests Act removes barriers and builds on California’s progress to accelerate more work on federal lands, faster,” said California Natural Resources Secretary Wade Crowfoot. “As an all-lands, all-hands approach, it is one more tool in the arsenal against the threat of wildfires. As we enter peak fire season, reducing catastrophic wildfire risk requires everyone to do their part.”
    “Across California, we are working year-round to reduce wildfire risk and enhance prevention efforts, and we are seeing results,” said Josh Nettles, CAL FIRE Assistant Region Chief. “Now by enhancing interagency coordination and promoting fire-resistant building methods and defensible space practices, the Fix Our Forests Act will help protect communities in the wildland-urban interface and elsewhere.”
    The American West has long been prone to wildfires, but climate change, prolonged drought, and the buildup of dry fuels have increasingly intensified these fires and extended fire seasons. Wildfires today are more catastrophic — growing larger, spreading faster, and burning more land than ever before. Nationwide, total acres burned rose from 2.7 million in 2023 to nearly 9 million in 2024, a 231 percent increase.
    California averages more than 7,500 wildfires a year. Not including the recent Los Angeles fires, six of the top 10 most destructive fires, three of the top five deadliest fires, and all of the state’s nine largest fires have burned since 2017. The status quo is simply unsustainable, and responding to the scale and magnitude of the crisis on the ground is essential to keeping California communities safe.
    Additionally, wildfires release carbon dioxide and other greenhouse gas emissions that accelerate climate change. California’s 2020 fire season, the worst on record, emitted enough greenhouse gases to erase nearly two decades of progress on emissions reductions in California. Addressing this wildfire emergency is critical to ensuring that our climate progress is not undermined by the devastating impacts of these fires.
    In the aftermath of the devastating Southern California fires, Senator Padilla has introduced more than 10 bills to help prevent and respond to future disasters. In February, Padilla introduced bipartisan legislation to create a national Wildfire Intelligence Center to streamline federal response and create a whole-of-government approach to combat wildfires. He also announced a package of three bipartisan bills to bolster fire resilience and proactive mitigation efforts, including the Fire-Safe Electrical Corridors Act, the Wildfire Emergency Act, and the Disaster Mitigation and Tax Parity Act. In January, Padilla introduced another suite of bipartisan bills to strengthen wildfire recovery and resilience, including the Wildland Firefighter Paycheck Protection Act, the Fire Suppression and Response Funding Assurance Act, and the Disaster Housing Reform for American Families Act. Additionally, earlier this month, he introduced the FEMA Independence Act, bipartisan legislation to restore the FEMA as an independent, cabinet-level agency and improve efficiency in federal emergency response efforts.
    Senator Padilla also visited Altadena last month, joining Senator Cory Booker (D-N.J.), FEMA, local leaders, and representatives from the Small Business Administration, Environmental Protection Agency, and USACE for a tour and briefing on cleanup and recovery efforts in the aftermath of the Eaton Fire.
    Video of today’s press conference is available here, and can be downloaded here.
    Additional photos from today’s tour are available here.

    MIL OSI USA News

  • MIL-OSI USA: Attorney General James Stands with Law Firm Targeted by Trump Administration

    Source: US State of New York

    EW YORK – New York Attorney General Letitia James and a coalition of 20 other attorneys general today filed an amicus brief supporting the law firm Susman Godfrey against illegal attacks by the Trump administration. President Trump issued Executive Orders imposing severe sanctions against Susman Godfrey in retaliation for doing work disfavored by the Trump administration. Attorney General James and a coalition argue in their amicus brief submitted to the U.S. District Court for the District of Columbia that the Executive Order violates the First Amendment, disregards the right to counsel, and undermines constitutional principles like the separation of powers.

    “The Trump administration cannot dictate which clients or issues law firms represent and support,” said Attorney General James. “These vindictive Executive Orders targeting law firms are a gross abuse of power and undermine our democracy and our Constitution. I will continue to use my voice and the force of my office to defend the rule of law and support the law firms bravely challenging these unjust attacks by the Trump administration.”

    President Trump has issued Executive Orders retaliating against law firms whose advocacy, clients, and personnel he dislikes. These orders require federal officials to suspend any active security clearances held by individuals at the targeted law firms, to refuse to engage with or hire employees of these firms, and to deny the law firms’ personnel entry to federal buildings. The orders also direct federal contractors to disclose any business they do with the law firms so that agencies can terminate any contract with the firms. 

    Susman Godfrey was named in one of these retaliatory executive orders in early April. Susman obtained temporary injunctive relief earlier this month and is now asking a judge to permanently block the Executive Order against it. When granting the temporary injunctive relief, a federal judge said, “the Executive Order is based on a personal vendetta against a particular firm. And, frankly, I think the framers of our Constitution would view it as a shocking abuse of power.”

    In their amicus brief, the attorneys general argue that a fair and functioning judicial system depends on lawyers being willing to work on controversial cases or represent unpopular clients without fearing retribution by the government. The attorneys general further assert that the orders will harm the residents of their states by making it more difficult for many potential clients – especially those who currently rely on pro bono representation – to obtain legal services and vindicate their rights in court. 

    Today’s briefs are the latest efforts by Attorney General James to support the legal industry against unconstitutional attacks by the Trump administration. Earlier this month, Attorney General James and a coalition of attorneys general submitted amicus briefs in support of Jenner & Block LLP and WilmerHale LLP. In March, Attorney General James filed an amicus brief in support of the law firm Perkins Coie LLP.

    Joining Attorney General James in filing today’s amicus briefs are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Mexico, New Jersey, Oregon, Rhode Island, Vermont, Washington, and the District of Columbia.

    MIL OSI USA News

  • MIL-OSI Global: Trump’s aggressive actions against free speech speak a lot louder than his words defending it

    Source: The Conversation – USA – By Daniel Hall, Professor of Justice and Community Studies & Political Science, Miami University

    Free speech in the U.S. is being curtailed by the Trump administration. Malte Mueller, fStop/Getty Images

    Harvard University took the extraordinary step of suing the Trump administration on April 21, 2025, claiming that the pressure campaign mounted on the school by the president and his Cabinet to force viewpoint diversity on campus violated the Constitution’s guarantees of free speech.

    “Defendants’ actions are unlawful,” Harvard’s lawsuit states. “The First Amendment does not permit the Government to ‘interfere with private actors’ speech to advance its own vision of ideological balance.’”

    Yet in his first term, President Donald J. Trump declared that free speech mattered.

    Trump issued the “Executive Order Restoring Free Speech and Ending Federal Censorship” on March 21, 2019. In it, he expressed the importance of free inquiry and open debate to education and directed federal officials to use the federal government’s funding of higher education to ensure that universities promote free inquiry.

    Channeling free-speech champions Benjamin Franklin and James Madison, Trump wrote that “free inquiry is an essential feature of our Nation’s democracy.”

    As a professor of constitutional, criminal and comparative law, and as a citizen who enjoys his liberty, I agree.

    Free speech is fundamental to human progress. Scientific, medical, technological and social advancements all rely on the free flow of information. Robust discussion and disagreement are equally important to maintaining a healthy constitutional republic.

    In the words of the late U.S. Supreme Court Justice Robert Jackson, “If there is any fixed star in our constitutional constellation, it is that no official, high or petty, can prescribe what shall be orthodox in politics, nationalism, religion, or other matters of opinion or force citizens to confess by word or act their faith therein.”

    The First Amendment’s free speech and press clauses protect all forms of expression – oral, print, digital and artistic – from governmental interference or punishment.

    Of the many types of speech, political speech is the most protected.

    On the first day of his second term in office, Trump issued another free speech executive order. It affirms the administration’s commitment to free speech, directs that tax money is not used to abridge free speech and instructs federal employees to “identify and take appropriate action to correct past misconduct by the Federal Government related to censorship of protected speech.”

    In a vacuum, Trump’s orders appear to bode well for free speech.

    But what is important is free speech reality, not rhetoric. Three months into his second term, where does Trump stand?

    The many interconnected orders, letters, statements and actions of Trump’s White House make an assessment of any positive effects difficult. On the other hand, the Trump administration has clearly violated and chilled free speech on many occasions.

    At his second inauguration, Donald Trump promised to ‘stop all government censorship’ and ‘bring back free speech.’

    Repression and retaliation

    Attempts to silence the president’s adversaries are developing as a pattern.

    Law firms and attorneys who have sued or prosecuted Trump, or represented his adversaries, have been targeted for retribution and concessions. It began with an executive order on March 6, 2025, directed at the U.S.-based global law firm Perkins Coie, which had once represented Trump’s opponent in the 2016 presidential race, Hillary Clinton. A second order was issued on March 14, 2025, against Paul, Weiss, Rifkind, Wharton & Garrison because it once employed an attorney who investigated Trump. Subsequently, at least six other prominent law firms were also targeted.

    Several law firms acceded to the president’s demands, agreeing to accept clients without regard to political beliefs, to eliminate DEI practices, and to perform pro bono work valued in the hundreds of millions of dollars for causes Trump supports.

    The firms that didn’t accede to the president’s demands had their security clearances removed, access to federal buildings restricted, and were banned from working for federal agencies. A few of the firms that didn’t relent have won temporary injunctions barring the administration’s actions against them.

    The nonpartisan free speech advocacy organization Foundation for Individual Rights and Expression decried the orders as threatening the foundations of justice and free speech. In one of several challenges to these orders, U.S. District Judge Beryl Howell wrote on March 12, 2025, that Trump’s order appeared motivated by “retaliatory animus” and concluded that it “runs head on into the wall of First Amendment protections.” Two other federal courts reached similar conclusions.

    In the first three months of his second term, Trump withdrew Secret Service protection of several prominent critics who are former federal government officials, including John Bolton, a former Trump national security adviser. Former Secretary of State Mike Pompeo, his top aide, Brian Hook, and former high-level health official Anthony Fauci also lost their security protection.

    It is hard to imagine that these decisions won’t have a profoundly chilling effect on potential critics of the president, especially since the revocations were publicly announced and each individual has been the subject of credible threats resulting from their governmental service.

    Targeting the press

    A similar pattern exists for journalists, where Trump is using his power to punish organizations whose reporting he doesn’t like.

    AP journalists were banned from the White House and Air Force One on Feb. 11, 2025, for refusing to refer to the Gulf of Mexico as the Gulf of America, the new name Trump had ordered for the body of water. On April 9, 2025, this ban was found to violate the First Amendment by a judge nominated by Trump during his first term.

    Denouncing CNN and MSNBC as “illegal” and claiming they are paid political operatives, Trump suggested they should be investigated during a speech at the U.S. Department of Justice.

    Trump effectively closed Voice of America, after 83 years of continuous broadcasting, for being “anti-Trump” and radical in its views. By charter, the broadcaster represents “America, not any single segment of American society,” with “accurate, objective, and comprehensive” news and “a balanced and comprehensive projection of significant American thought and institutions” through television, radio, internet, social media and satellite broadcasts to peoples around the world.

    The Federal Communications Commission has initiated regulatory actions against the licenses of several television stations for broadcasts that have been accused by the President of being anti-Trump or biased in favor of Kamala Harris. Early in the process, the outcomes of these actions are to be determined.

    Protesters in Somerville, Mass., on March 26, 2025, demand the release of Rumeysa Ozturk, a Turkish student at Tufts University, whose recent arrest by federal agents is seen as an assault on free speech.
    AP Photo/Michael Casey

    Pressuring universities and students

    Other administration actions, I believe, raise serious free speech issues.

    Harvard isn’t the only university feeling pressure.

    The administration is threatening to withhold federal money from universities as a way to coerce many of them to comply with administration policies in ways that implicate free speech and in some instances violate legal processes for the withholding of federal support.

    Some of the Trump administration’s recent immigration enforcement efforts have targeted international students who are in the U.S. lawfully but who participated in Palestinian rights protests and disagreed with Israel’s actions during the war in Gaza.

    The administration claims that some students whose visas have been revoked were either Hamas supporters or violated criminal laws. The administration has also said that many students are being deported under broad authority the secretary of state has to deport those deemed a danger to national security.

    Democracy and free speech

    In the past decade, the U.S. has fallen in press freedom, rule of law and democratic governance, resulting in the classification of a “flawed democracy” by the Economist Intelligence Unit, a democratic watchdog. Unsurprisingly, there has been a simultaneous rise in public support for authoritarianism. These changes make support for free speech increasingly important.

    On March 4, 2025, Trump declared in a speech before a joint session of Congress that he “stopped all government censorship and brought free speech back to America.”

    The record doesn’t support this claim.

    Daniel Hall does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    ref. Trump’s aggressive actions against free speech speak a lot louder than his words defending it – https://theconversation.com/trumps-aggressive-actions-against-free-speech-speak-a-lot-louder-than-his-words-defending-it-252706

    MIL OSI – Global Reports

  • MIL-OSI USA: Graham Applauds Trump Administration Funding I-95 Bridge Project

    US Senate News:

    Source: United States Senator for South Carolina Lindsey Graham

    WASHINGTON – U.S. Senator Lindsey Graham (R-South Carolina) joined federal and state officials in celebrating news from the U.S. Department of Transportation (DOT) that the South Carolina Department of Transportation (SCDOT) would receive the Trump Administration’s first federal grant agreement under the Bridge Investment Program (BIP) to fund the replacement of I-95 bridges over Lake Marion.

    Last year, Senator Graham joined Governor McMaster and other South Carolina federal and state officials to celebrate the initial grant announcement. Graham led the South Carolina delegation in securing funding for this project. 

    “I am very grateful to Secretary Duffy and his team for starting to push the grant funds out the door – at the direction of President Trump – to make the I-95 bridges replacement project over Lake Marion a reality,” said Senator Graham. “This is one of the most important projects in our state. It’s been a collaborative effort and will tremendously improve quality of life and commerce in the region.”

    “President Trump tasked my Department with a clear objective: rebuild America’s aging infrastructure,” said U.S. Transportation Secretary Sean P. Duffy. “The previous administration left the nation with an unprecedented backlog of unfulfilled grant agreements and empty promises. Within 100 days of inauguration, we’re already delivering results.”

    “Thank you to Secretary Duffy for delivering this critical grant money to fund the bridge on I-95,” said U.S. Senator Tim Scott. “This common-sense investment in infrastructure is a win for every South Carolinian who commutes to work, operates a business, moves our goods, and transports their family. President Trump and Secretary Duffy are proving once again that they know how to get things done and will deliver on their promise to focus on our infrastructure without saddling Americans with unnecessary debt or wasteful political agendas.”

    “South Carolina appreciates the quick action by Secretary Duffy and the Trump administration to advance this critical grant project,” said South Carolina Secretary of Transportation Justin Powell. “The Lake Marion Bridge project will help ensure a bright future for the people of our state and the nation.  SCDOT is prepared to move forward immediately to put these dollars to work by building big, transformative infrastructure that benefits American families.”

    More information from DOT is available HERE.

    MIL OSI USA News

  • MIL-OSI USA: Kaine, Colleagues Demand Trump Rescind Threat to Transfer Incarcerated U.S. Citizens to El Salvador Prison

    US Senate News:

    Source: United States Senator for Virginia Tim Kaine

    WASHINGTON, D.C. – U.S. Senator Tim Kaine, the Ranking Member of the Senate Foreign Relations Subcommittee on the Western Hemisphere, (D-VA) and 25 of his Senate colleagues demanded in a letter to President Donald Trump that he immediately rescind the illegal and dangerous claim that he may transfer incarcerated U.S. citizens to a prison in El Salvador.

    In the letter, the senators also demanded that Trump follow U.S. law, adhere to all applicable court orders, and immediately facilitate the return to the U.S. of Kilmar Abrego Garcia. The Trump Administration illegally deported Abrego Garcia—a father in Maryland who was legally living in the U.S.—to El Salvador in direct contravention of a court order specifically prohibiting such removal.

    “Your unprecedented actions threaten the constitutional protections of all Americans and violate the fundamental principles on which this nation was founded,” wrote the senators.

    The senators continued, “With regard to your shocking assertion about transferring Americans to El Salvador, you cannot deport Americans to a foreign country for any reason. This nation’s founding fathers declared independence based on ‘repeated injuries and usurpations’ by the then-King of Great Britain, including ‘transporting us beyond Seas to be tried for pretended offences’ and ‘depriving us in many cases, of the benefits of Trial by Jury.’ Accordingly, Congress has passed no provision into law that would permit exiling United States citizens to a foreign country for any reason.”

    “Our laws also do not allow you to send individuals from U.S. soil to El Salvador without due process. Further, the Executive Branch must comply with longstanding domestic and international law that prohibits the United States from transferring any person from our jurisdiction or effective control to a place where the person would face certain serious human rights violations,” wrote the senators.

    “You must also end your unlawful attempts to deport noncitizens without due process under the Alien Enemies Act, as the Supreme Court ordered this weekend,” the senators concluded. “You must immediately facilitate the return to the United States of Kilmar Abrego Garcia, follow all court orders, and withdraw your dangerous and offensive claims that you may transfer U.S. citizens to a foreign prison. The Constitution demands it.”

    In addition to Kaine, the letter was led by U.S. Senator Dick Durbin (D-IL), the Ranking Member of the Senate Judiciary Committee, and signed by U.S. Senators Chris Van Hollen (D-MD), Mazie Hirono (D-HI), Chris Coons (D-DE), Alex Padilla (D-CA), Richard Blumenthal (D-CT), Angela Alsobrooks (D-MD), Jeff Merkley (D-OR), Adam Schiff (D-CA), Peter Welch (D-VT), Tammy Duckworth (D-IL), Amy Klobuchar (D-MN), Cory Booker (D-NJ), Bernie Sanders (I-VT), Sheldon Whitehouse (D-RI), Lisa Blunt Rochester (D-DE), Rev. Raphael Warnock (D-GA), John Hickenlooper (D-CO), Ron Wyden (D-OR), Elizabeth Warren (D-MA), Tammy Baldwin (D-WI), Ed Markey (D-MA), Tina Smith (D-MN), Patty Murray (D-WA), and Martin Heinrich (D-NM).

    A copy of letter is available here and text is below.

    Dear President Trump:

    We call on you to immediately rescind the dangerous and offensive claim that you may transfer incarcerated U.S. citizens to El Salvador. We further urge you to follow the law and adhere to all applicable court orders and immediately facilitate the return to the United States of Kilmar Abrego Garcia, whom your Administration illegally deported to El Salvador in direct contravention of a court order specifically prohibiting such removal. Your unprecedented actions threaten the constitutional protections of all Americans and violate the fundamental principles on which this nation was founded. 

    With regard to your shocking assertion about transferring Americans to El Salvador, you cannot deport Americans to a foreign country for any reason. This nation’s founding fathers declared independence based on “repeated injuries and usurpations” by the then-King of Great Britain, including “transporting us beyond Seas to be tried for pretended offences” and “depriving us in many cases, of the benefits of Trial by Jury.” Accordingly, Congress has passed no provision into law that would permit exiling United States citizens to a foreign country for any reason. One conservative legal scholar called your threats to deport U.S. citizens “obviously illegal and unconstitutional.”

    Our laws also do not allow you to send individuals from U.S. soil to El Salvador without due process. Further, the Executive Branch must comply with longstanding domestic and international law that prohibits the United States from transferring any person from our jurisdiction or effective control to a place where the person would face certain serious human rights violations. Your Administration’s actions in sending individuals to a Salvadoran prison notorious for inhumane conditions underscore the urgency and applicability of these requirements. The bedrock principles of the Fifth Amendment’s Due Process Clause protect individuals from being “deprived of life, liberty, or property, without due process of law.” Throughout our nation’s history, the Supreme Court has long read the Fifth Amendment’s guarantee of due process to require that the government provide persons with certain procedural due process protections, including notice and an opportunity to be heard before any such deprivation of liberty.

    Even under extraordinary wartime authorities such as the Alien Enemies Act, the Supreme Court of the United States has held that noncitizens should, at a minimum, have an opportunity to prove whether or not the Act should apply to them. In a statement accompanying the Supreme Court’s recent order for the federal government to facilitate the return of Mr. Abrego Garcia and “ensure that his case is handled as it would have been had he not been improperly sent to El Salvador,” Justice Sotomayor noted that your Administration’s argument suggesting that the government is permitted to leave Mr. Abrego Garcia in the Salvadoran prison after wrongfully sending him there “implies that it could deport and incarcerate any person, including U.S. citizens, without legal consequence, so long as it does so before a court can intervene.” She went on to note that this is a “view [that] refutes itself.”

    You must immediately facilitate the return of Mr. Abrego Garcia, which is unquestionably within your power to do since your Administration is paying the government of El Salvador to detain him. As Judge Harvie Wilkinson, a conservative appointee of President Reagan, wrote in a unanimous Fourth Circuit opinion rejecting your Administration’s efforts to delay taking steps to bring Mr. Abrego Garcia back to the United States: 

    The government is asserting a right to stash away residents of this country in foreign prisons without the semblance of due process that is the foundation of our constitutional order. Further, it claims in essence that because it has rid itself of custody that there is nothing that can be done. This should be shocking not only to judges, but to the intuitive sense of liberty that Americans far removed from courthouses still hold dear.

    You must also end your unlawful attempts to deport noncitizens without due process under the Alien Enemies Act, as the Supreme Court ordered this weekend. You have no authority to openly defy court orders requiring you: (1) to return someone who has been  wrongfully deported, or (2) to grant individuals the due process they are owed under our laws.  As Judge Boasberg wrote in his order last week concluding that probable cause exists to find the government in criminal contempt:

    The Constitution does not tolerate willful disobedience of judicial orders—especially by officials of a coordinate branch who have sworn an oath to uphold it. To permit such officials to freely “annul the judgments of the courts of the United States” would not just “destroy the rights acquired under those judgments”; it would make “a solemn mockery” of “the constitution itself.” …“So fatal a result must be deprecated by all.”

    You must immediately facilitate the return to the United States of Kilmar Abrego Garcia, follow all court orders, and withdraw your dangerous and offensive claims that you may transfer U.S. citizens to a foreign prison. The Constitution demands it.

    Sincerely,

    MIL OSI USA News

  • MIL-OSI USA: Washington state joins coalition of AGs supporting law firm singled out by executive order

    Source: Washington State News

    OLYMPIA — Attorney General Nick Brown has joined 20 other attorneys general in an amicus brief in support of law firm Susman Godfrey, which is challenging an unconstitutional presidential order issued as retribution against the firm for representing clients in the aftermath of the 2020 election and defending the integrity of that election.

    The order, similar to others targeting specific law firms for who they’ve represented, violates the firm’s rights to free speech, due process, and other constitutional protections.

    “The president’s order is illegal — yet again — and a direct attack on the right to legal representation,” Brown said. “The Constitution and America’s defining values of fairness are both at risk under these actions.”

    President Donald Trump has issued five executive orders retaliating against law firms whose advocacy, clients, and staff he dislikes. These orders require federal officials to suspend any active security clearances held by the law firms’ workers, to refuse to engage with or hire employees of these firms, and to deny the law firms’ personnel entry to federal buildings. The orders also direct federal contractors to disclose any business with the law firms so that agencies can terminate any such contracts. Four courts that have reviewed those orders found they are likely unconstitutional.

    Susman Godfrey, a law firm with an office in Seattle, was named in one of these retaliatory executive orders in early April. Susman obtained temporary injunctive relief earlier this month and is now asking a judge to permanently block the executive order against it.

    When granting the temporary injunctive relief, a federal judge said, “The executive order is based on a personal vendetta against a particular firm. And, frankly, I think the framers of our Constitution would view it as a shocking abuse of power.”

    Washington State Attorney General Nick Brown and the other attorneys general note that a fair and functioning judicial system depends on lawyers being willing to work on controversial cases or represent unpopular clients without fearing retribution by the government. The attorneys general say the orders will harm their states’ residents by making it more difficult for many potential clients — especially those who currently rely on pro bono representation — to obtain legal services and vindicate their rights in court.

    The coalition was led by the attorneys general from Washington, Illinois, New Jersey, and Massachusetts. Joining them in filing the briefs were Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Hawaii, Maine, Maryland, Michigan, Minnesota, Nevada, New Mexico, New York, Oregon, Rhode Island, and Vermont.

    The brief can be found here. More information about previous amicus briefs in support of other law firms are here and here. State attorneys general also wrote a letter to support the legal community, which can be found here.

    -30-

    Washington’s Attorney General serves the people and the state of Washington. As the state’s largest law firm, the Attorney General’s Office provides legal representation to every state agency, board, and commission in Washington. Additionally, the Office serves the people directly by enforcing consumer protection, civil rights, and environmental protection laws. The Office also prosecutes elder abuse, Medicaid fraud, and handles sexually violent predator cases in 38 of Washington’s 39 counties. Visit www.atg.wa.gov to learn more.

    Media Contact:

    Email: press@atg.wa.gov

    Phone: (360) 753-2727

    General contacts: Click here

    Media Resource Guide & Attorney General’s Office FAQ

    MIL OSI USA News

  • MIL-OSI USA: Attorney General Bonta Condemns Trump Administration Campaign to Silence Legal Sector, Files Brief in Support of Susman Godfrey

    Source: US State of California

    OAKLAND — California Attorney General Rob Bonta today, along with 21 attorneys general, filed an amicus brief in support of Susman Godfrey LLP’s lawsuit seeking to block the Trump Administration from retaliating against the firm and its attorneys. The Trump Administration’s actions against Susman Godfrey are part of a larger campaign by President Trump to silence lawyers and law firms that represent individuals and causes that he does not agree with. In the amicus brief, the attorneys general defend the rule of law and ask the court to permanently halt the Trump Administration’s retaliatory actions.

    “Everybody is entitled to legal access and vigorous representation without fear of retribution. The Trump Administration’s political attack on Susman Godfrey based on the clients and ideas they represent is an attempt to silence people who challenge the President. If allowed to continue, this will have an immediate chilling effect on attorneys nationwide, making it harder for lawyers to provide the critical legal services on which our courts and residents depend,” said Attorney General Bonta. “Along with my fellow attorneys general, I proudly stand in support of Susman Godfrey and all other law firms whose free speech rights are being targeted and strongly condemn President Trump’s effort to silence those he disagrees with.”

    Over the past two months, President Trump has issued an unprecedented series of executive orders imposing severe sanctions on law firms whose advocacy, clients, and lawyers he dislikes. Earlier this month, the Trump Administration issued an executive order targeting Susman Godfrey, which sued Fox News for alleged election-related lies. The order strips the firm of active security clearances and terminates federal contracts with the firm and its clients, among other things. Susman Godfrey sued to halt enforcement of the order targeting their firm, citing violations of free speech and unconstitutional interference with the rights of their clients to select lawyers of their choosing.  

    In the brief, the attorneys general argue that by retaliating against Susman Godfrey and discriminating based on viewpoint, the Trump Administration is violating the First Amendment and ask the court to permanently halt the Trump Administration’s retaliatory actions. The attorneys general make the point that a well-functioning judicial system depends on the willingness of lawyers to take on difficult cases or unpopular clients without retribution by their government. Any attempts to deter lawyers from representing the full spectrum of clients and causes would undermine judicial systems across the country.  

    Attorney General Bonta has vigorously called out President Trump’s assault on the rule of law. Last month, Attorney General Bonta, along with 20 other state attorneys general issued an open letter urging the legal community to stand together in defense of the rule of law in response to President Trump’s recent attacks, which include calls for the impeachment of federal judges and threats of retribution against law firms and attorneys who take or have taken positions in opposition to him or his Administration. Attorney General Bonta also issued a separate statement on the need to speak up and push back when our democratic norms are violated, our legal system undermined, and our laws broken. Attorney General Bonta has filed amicus briefs in support of Perkins Coie, WilmerHale, and Jenner & Block, law firms that have also been targeted by the Trump Administration over their representation of clients or positions President Trump disagrees with.   

    In filing the brief, Attorney General Bonta joins the attorneys general of Washington, Illinois, New Jersey, Massachusetts, Arizona, Colorado, Connecticut, Delaware, Hawaii, Maine, Maryland, Michigan, Minnesota, Nevada, New Mexico, New York, Oregon, Rhode Island, Vermont, and the District of Columbia. 

    A copy of the brief can be found here. 

    MIL OSI USA News

  • MIL-OSI United Nations: Committee on the Elimination of Racial Discrimination Holds Informal Meeting with States Parties to the Convention

    Source: United Nations – Geneva

    The Committee on the Elimination of Racial Discrimination today held an informal meeting with States parties to the International Convention on the Elimination of All Forms of Racial Discrimination.

    Opening the meeting, Michal Balcerzak, Committee Chair, said this year was the sixtieth anniversary of the entry into force of the Convention.  This was a moment of reflection, not only on past achievements, but also on the current and future viability of the treaty body system. The Committee was facing turbulent times, and many challenges were undermining the realisation of human rights and racial equality.

    Mr. Balcerzak called on States parties to renew commitment to fully respect and effectively implement obligations under international human rights law, including the Convention.  Prompt action was needed to end current conflicts, address the root causes of racial discrimination, and prevent further human rights violations targeting people based on their national or ethnic origin and identity.

    Régine Esseneme, Committee Vice-Chair, said the Convention was adopted by the General Assembly in 1965 and entered into force in 1969.  It covered all areas of human rights and fundamental freedoms and had been ratified by 182 countries.  For several years, States parties had submitted fewer reports to the Committee, often choosing to combine reports over longer periods. 

    The discussion with States parties addressed topics including the liquidity crisis facing the Committee and the United Nations treaty body system, cooperation with the Committee, commemoration of the Convention’s sixtieth anniversary, the Committee’s simplified reporting and individual communications procedures, hybrid dialogues, and measures to prevent racial discrimination.

    Speaking in the discussion were Mexico, Finland, Belgium, Bolivia, Spain, Brazil, Venezuela, China and Cuba.

    The programme of work and other documents related to the Committee’s one hundred and fifteenth session can be found here.  Summaries of the public meetings of the Committee can be found here, while webcasts of the public meetings can be found here.

    The Committee will next meet in public on Friday, 25 April at 3 p.m. to hold a half-day general discussion on reparations for the injustices from the transatlantic trade of enslaved Africans, their treatment as chattel, and the ongoing harms to and crimes against people of African descent.

    Opening Statements

    MICHAL BALCERZAK, Committee Chair, said this year was the sixtieth anniversary of the entry into force of the International Convention on the Elimination of All Forms of Racial Discrimination.  This was a moment of reflection, not only on past achievements, but also on the current and future viability of the treaty body system. The Committee was facing turbulent times, and many challenges were undermining the realisation of human rights and racial equality.

    In the last 60 years, there had been progress in the fight against racial discrimination.  However, progress had not occurred at the pace and to the extent needed and expected by marginalised groups and victims of racial discrimination, and today, there were serious risks of backsliding.  The Committee called on States parties to renew commitment to fully respect and effectively implement obligations under international human rights law, including the Convention.  Prompt action was needed to end current conflicts, address the root causes of racial discrimination, and prevent further human rights violations targeting people based on their national or ethnic origin and identity.

    The United Nations treaty body system was faced by an unprecedented crisis marked by acute financial and liquidity constraints.  These challenges struck at the very core of the Committee’s ability to carry out its mandate effectively.  The downsizing of resources had already begun to significantly impair the Committee’s work. Under the Convention, the expenses of the Committee were required to be borne by State parties.  The current situation raised serious concerns about the sustainability of this obligation.  The Committee was facing the real risk of reducing its activities, and, in a worst-case scenario, cancelling sessions due to lack of resources.  This year, the second and third sessions of the Committee were not yet confirmed.  Weakening of the Committee would not only weaken international human rights oversight but also send a troubling signal about the collective will to combat racial discrimination globally. 

    In addition, the Committee was increasingly impacted by a drop in timely reporting by States parties – a trend that undermined its ability to plan and hold dialogue sessions, notably for the years 2026 and 2027.  But despite these challenges, the Committee remained steadfast.  On average, it reviewed 18 State party reports per year, consistently worked to refine its methods of work, and continued to engage in meaningful, forward-looking initiatives in line with its mandate.

    This year marked the sixtieth anniversary of the Convention, which was adopted on 21 December 1965.  To mark this auspicious occasion, the Committee and its Secretariat were working in collaboration with partners on a year-long campaign throughout 2025.  The campaign highlighted the foundational importance of the Convention for the fight against racial discrimination, and focused attention on its continued relevance today.  It would stimulate discussions on effective practices to address structural and emerging challenges in preventing and combatting racial discrimination and aimed to renew the commitment for the effective implementation of the Convention. 

    The Committee encouraged all States parties to the Convention to contribute to the anniversary by taking concrete action to implement the Convention, including jointly with other States and stakeholders, at the local, national, regional or international levels. The Committee would hold a high-level commemorative event, tentatively scheduled to take place on 4 December 2025. The active support of States parties and all stakeholders in the organization of this event was crucial for its success.

    The Committee had adopted general recommendation 37 in 2024 on equality and freedom from racial discrimination in the enjoyment of the right to health.  This general recommendation clarified the obligations undertaken under the Convention regarding the right to health and provided guidance on measures to address concerns in line with the Convention. 

    Currently, the Committee was working with the Committee on Migrant Workers on a joint general recommendation on xenophobia; regional consultations were held last year to inform the drafting. It was also elaborating a general recommendation on reparations, which would provide guidance on the scope and content of the right to reparations under international human rights law, particularly concerning the harms of the forced capture of Africans, the transatlantic transport of those captives, their enslavement as chattel, and the massive and continuing harms suffered by their descendants.

    The Committee called on States parties to provide advice on how to address the unprecedented crisis affecting the treaty body system.

    RÉGINE ESSENEME, Committee Vice-Chair, said the Convention was adopted by the General Assembly in 1965 and entered into force in 1969.  It covered all areas of human rights and fundamental freedoms and had been ratified by 182 countries.  These States parties had committed to engaging in the Committee’s periodic review process, under which each State party was obliged to submit an initial report after one year of ratification and subsequent periodic reports every two years.  For several years however, States parties had submitted fewer reports to the Committee, often choosing to combine reports over longer periods. 

    Most States had submitted to the Committee’s simplified reporting procedure, but given its resource limitations, the Committee prioritised States with reports overdue by more than 10 years for this procedure.  Currently, 78 States parties had significant delays in the submission of reports.  The Committee sought States’ views on this issue and on methods of fostering collaboration with States parties to ensure that they honoured their commitments under the Convention.

    Discussion with States Parties

    In the ensuing discussion, representatives of States parties said, among other things, that the Convention, the first fundamental human rights treaty, was an essential tool for combatting racial discrimination.  Speakers expressed commitment to fulfilling their obligations under the Convention and eliminating racial discrimination, xenophobia and social exclusion, and to cooperating with the Committee.  They thanked the Committee for its work in eliminating racial discrimination. Cooperating with the Committee gave States the ability to ensure the highest possible implementation of the Convention.

    Many speakers said they would join in the commemoration of the sixtieth anniversary of the Convention, which offered an opportunity for renewing commitments under the Convention and addressing modern challenges related to racial discrimination, including hate speech, discrimination and xenophobic practices.  They expressed concern about the United Nations’ liquidity crisis, which impacted the Committee’s work.

    Speakers presented measures to prevent racial discrimination and promote racial equality; recognise the status and promote the rights of indigenous peoples, as well as their participation in policy development; and participate in the Committee’s reporting procedure and follow-up on the recommendations of the Committee.

    Some speakers proposed that the Committee held hybrid meetings with States when necessary to promote the participation of civil servants with specific knowledge and civil society in States with limited resources.  One speaker called for the hybrid meeting tools used by the United Nations to guarantee the equal participation of all States.  Some speakers called on the Committee to strengthen its cooperation with regional mechanisms and other international bodies, including the United Nations Office on Genocide Prevention and the Responsibility to Protect.

    One speaker said that individual communications needed to be handled effectively.  How did the Committee monitor the implementation of its decision on individual communications?

    Some speakers noted that the Committee had decided to extend the simplified reporting procedure to all States parties, but at the same time requested many States to continue using the regular reporting procedure as their reports were not overdue by 10 years. Why had the Committee decided to do this?  The simplified reporting procedure would ease States’ reporting burden.  Without this procedure, future report submissions could be delayed, they said.  Other speakers, however, said that there were disadvantages to the simplified procedure, expressing support for the regular reporting procedure.  One speaker said that efforts to simplify reporting procedures needed to be balanced with efforts to establish a predictable reporting calendar.

    One speaker expressed concern regarding unilateral coercive measures and human rights violations against migrants, including their illegal deportation to other States.  Another speaker raised the issue of trans-Atlantic slavery, expressing support for a new United Nations instrument on the rights of people of African descent.

    Statements and Responses by Committee Experts

    MICHAL BALCERZAK, Committee Chair, thanked States for the proposals they had put forward.  He said that the Committee offered the possibility of hybrid dialogues, which were not currently shortened compared to regular dialogues.  The Committee regretted that it did not have the possibility to hold hybrid meetings with other stakeholders.

    The simplified reporting procedure was a crucial issue.  There was a problem with this procedure in that it was not, in fact, simple from the perspective of the Committee and its secretariat.  If the Committee had more capacity to prepare lists of issues prior to reporting, it would have done so.

    The Chair encouraged States parties to engage in events to commemorate the sixtieth anniversary of the Convention, information on which was available online.  He also called for further dialogue between the Committee and regional bodies.

    NOUREDDIN AMIR, Committee Expert, said that Committee Experts were elected by States every two years on a rolling basis.  They sought to achieve States’ aspirations to better fulfil their human rights obligations. The Committee was committed to combatting racism and injustice, which was everywhere.  It needed to promote discussions between belligerents in the wars that were currently raging.  Women and children were being killed in Palestine.  States needed to take responsibility for these issues, stop criminals, and seek justice for those whose voices were not heard.  The International Court of Justice needed to be able to condemn States that carried out forbidden acts against international law.

    STAMATIA STAVRINAKI, Committee Expert, said that the Committee’s individual communications procedure had not yet reached its full potential, as around one-third of States parties to the Convention had not accepted the procedure.  Last year, the Committee adopted decisions on 48 complaints and found violations in 27 of them.  The Committee advocated for this procedure, which created an opportunity to remedy harms caused by racial discrimination and to prevent future violations.  States parties could deploy junior professionals to support the Working Group on individual communications.  The Committee invited States to accept the individual communications procedure, which would reenforce their efforts to combat racial discrimination effectively.

    FAITH DIKELEDI PANSY TLAKULA, Committee Expert, said that the Committee had strengthened its relationship with regional human rights mechanisms, contacting relevant regional bodies regarding their assessment of follow-up efforts to the Committee’s concluding observations.  The concluding observations contained recommendations for improving the implementation of the Convention, which were to be implemented within one year. States parties were required to submit follow-up reports on the implementation of these recommendations, but only one-third of States parties submitted reports, which often did not demonstrate sufficient implementation of the recommendations.  The Committee called on all States to submit these reports.

    VERENE ALBERTHA SHEPHERD, Committee Vice-Chair, expressed pleasure that several States parties from the Group of Latin America and the Caribbean region were attending the meeting. She was the only Expert on the Committee from this region.  She called on these States to promote the appointment of more Experts from the region. It was regrettable that some countries had difficulty in using hybrid tools offered for participation in dialogue, and that some non-governmental organizations could not attend meetings with the Committee.  The Committee would address these issues.

    Ms. Shepherd said that a second International Decade for People of African Descent had been established by the General Assembly.  She called on all States to participate in commemorations of the Decade.  The Committee used an intersectional lens when addressing racial discrimination to address issues such as gender.  In closing, she called on States to financially support the Committee to address its liquidity crisis.

    GAY MCDOUGALL, Committee Vice-Chair, said that the Committee had issued general recommendation 25 on gender, in which it committed to taking an intersectional approach to gender.  The Committee was also committed to assessing the relationship between racial discrimination and economic marginalisation. It was assessing opportunities for decent work for ethnic minorities, as well as access to education and other social services.

    The Committee was concerned by its shrinking resources and capacity to do its work.  It was in the worst situation of any treaty body in terms of resources.  Although it had one of the most ratified treaties, the Committee received among the lowest number of reports.  Why was this?

    RÉGINE ESSENEME, Committee Vice-Chair, said the legal basis for the presentation of reports was article nine, paragraph one of the Convention.  The purpose of the simplified reporting procedure was to encourage States to submit reports.  However, it had not led to an increase in the number of reports that the Committee received. The Committee was affected by a lack of human and financial resources.  The simplified reporting procedure was not simple for the Committee; it was thus the exception and not the rule.  States needed to respect their reporting obligations under the Convention.

    CHINSUNG CHUNG, Committee Expert, said the Committee and all nine treaty bodies had inter-State communications procedures.  The Committee had received and considered three inter-State communications, and amicable solutions to two of these complaints had been found.  A third communication had been received from the State of Palestine against Israel in 2018.  The Committee had issued six recommendations in relation to this communication.  What steps could the Committee take to ensure that its recommendations would be implemented? Ms. Chung encouraged States to cooperate with the inter-State communications procedure.

    IBRAHIMA GUISSE, Committee Expert, said that the Committee had set up an early warning mechanism to prevent existing issues from becoming conflicts.  The mechanism could intervene if there was a lack of legislation or mechanisms to prevent racial discrimination, or to react to discriminatory statements or actions.  The Committee had recently adopted decisions under this procedure related to Sudan and the State of Palestine, which had been cited by the International Court of Justice.  Most conflicts in the world stemmed from racial or religious issues.  The Committee could be a major force to prevent such crises, but it needed the support of States in this regard.

    BAKARI SIDIKI DIABY, Committee Expert, commended the efforts of States parties to engage in dialogue with the Committee.  Some States had not come before the Committee for more than 20 years.  The simplified procedure was set up to assist such States. The Committee also had the power to examine States parties in the absence of a report if necessary and it had done so in the past.  It called on all States to help victims protected by the Convention and to engage in dialogue with the Committee.  States also needed to cooperate with civil society in preparation for dialogues. Some members of civil society who had cooperated with the Committee had been subjected to reprisals; the United Nations had no tolerance for this.

    PELA BOKER-WILSON, Committee Expert, said that reviews of some States parties showed a lack of collection of disaggregated data that allowed for a comparison of population groups. This entailed moving away from traditional data collection practices.  States parties were encouraged to collect data on sex, age, ethnicity, migration status, disability, religion and other distinctions.

    GÜN KUT, Committee Expert, thanked representatives of States parties for engaging with the Committee and expressing support for the Committee’s work.  The Committee was sensitive to States’ questions, demands and criticisms.  The success of the Committee depended on States parties’ will and contributions. The Committee needed regularity in the submission of reports and sufficient follow-up to the Committee’s recommendations, including through follow-up and periodic reports.  The Committee sought to improve its work, but this depended on securing sufficient meeting time and support for the Committee’s secretariat.  States needed to commit to sending reports on time and supporting the financial situation of treaty bodies.

    MAZALO TEBIE, Committee Expert, called on States to support the functioning of the Committee.

    YEUNG KAM JOHN YEUNG SIK YUEN, Committee Expert, said many States parties had not taken steps to criminalise hate speech.  Was this done deliberately to protect politicians?  When the Committee issued a decision on an individual communication, it left it to States parties involved to implement it.  The Committee took up implementation of these decisions in dialogues with States parties.

    Closing Remarks

    MICHAL BALCERZAK, Committee Chair, thanked States parties for attending the meeting.  The Committee would do its best to address the issues raised in the dialogue.  It would work efficiently with States and ensure that it did not disappoint victims of racial discrimination.  The Chair called on States to encourage the commemoration of the sixtieth anniversary of the Convention across the world.  The Committee looked forward to further engagement with States in future.

    ___________

    Produced by the United Nations Information Service in Geneva for use of the media; 
    not an official record. English and French versions of our releases are different as they are the product of two separate coverage teams that work independently.

    CERD25.003E

    MIL OSI United Nations News

  • MIL-OSI United Nations: Hydramo

    Source: UNISDR Disaster Risk Reduction

    Mission

    Hydramo’s mission is to deliver affordable, accessible, and autonomous flood early warning systems by combining in-situ environmental sensing, Earth Observation (EO) data, and direct-to-satellite communication.

    Hydramo empowers vulnerable communities and governments to predict, detect, and respond to floods in real time — even in remote, infrastructure-limited regions — through a scalable solution that bridges space-based insights with ground-level realities.

    MIL OSI United Nations News

  • MIL-OSI United Nations: WaveSave

    Source: UNISDR Disaster Risk Reduction

    Mission

    WaveSave, is dedicated to turning water-related uncertainties into confidence for a secure future. As a leader in end-to-end water control solutions, WaveSave specializes in managing the risks of floods and droughts, ensuring that communities and institutions worldwide can thrive sustainably.

    Wave Save aims to empower communities, governments, and organizations worldwide with innovative water control solutions that mitigate the risks of floods and droughts, ensuring safety, sustainability, and prosperity for all.

    MIL OSI United Nations News

  • MIL-OSI United Nations: Experts of the Committee on the Elimination of Racial Discrimination Commend Ukraine’s Presence Despite the Prevailing Circumstances, Raise Questions on the Treatment of Ukraine’s Indigenous Peoples and the Roma Population

    Source: United Nations – Geneva

    The Committee on the Elimination of Racial Discrimination today concluded its consideration of the combined twenty-fourth to twenty-sixth periodic reports of Ukraine.  Committee Experts congratulated the State party for appearing before the Committee despite prevailing circumstances, while raising questions on the treatment of Ukraine’s indigenous peoples and the Roma population. 

    A Committee Expert congratulated the Ukrainian delegation for making a laudable effort to assess the implementation of the Convention in the country, despite prevailing circumstances. Ukraine should be praised for this effort. 

    Chinsung Chung, Committee Expert and Co-Rapporteur, said the Committee noted that the State party adopted the law on indigenous peoples in 2021.  However, according to information before the Committee, the law only recognised Crimean Tatars, Karaims and Krymchaks as indigenous peoples in Ukraine, while excluding other groups, such as Hutsuls, Lemkos and Gagauz peoples.  Could the delegation provide clarifications on the law on indigenous peoples and how it aligned with international standards? What measures were in place to preserve and promote the identity, language and culture of all indigenous people under the jurisdiction of the State party?

    Ms. Chung also said that according to the representative of the Office of the Ombudsman of Ukraine, around 100,000 Roma became refugees, and around the same number of Ukrainian Roma became internally displaced persons.  Were accurate statistics available?  Did the State party find durable solutions for internally displaced Roma and take measures to ensure that they benefitted from assistance?  What were the State’s plans to include Roma people in recovery and reconstruction programmes?

    The delegation said in 2021, the Ukrainian Parliament adopted the law on indigenous peoples in Ukraine, which was developed through extensive consultations with indigenous groups and civil society, and represented the aspirations of these groups.  In addition, a draft law was developed on the status of the Crimean Tartar people which would be registered in Parliament in the near future. 

    Officially, Ukraine recognised three indigenous groups of peoples, including Crimean Tartars, Karaims and Krymchaks.  The Lemkos people were not considered a national minority group, but rather a cultural group.  The public broadcaster of Ukraine produced programmes for national minorities in their national languages, across broadcast, radio and digital formats. 

    Mr. Lossovskyi said in 2021, the Ukrainian Government approved the Roma strategy, and every two years action plans were prepared for its implementation.  The Roma community was a young community, one of the youngest among the national minorities in Ukraine.  It would be beneficial to use their innovation and abilities in the process of renovating Ukraine when the war was over.  The State was working on providing the Roma with more education. There were many grants provided to Roma for studying in universities. 

     

    Introducing the report, Ihor Lossovskyi, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said during the reporting period from 2014 to 2019, fundamental tragic changes took place in Ukraine, in particular the beginning of the Russian aggression.  At the height of the Russian invasion, in April 2022, Ukraine applied for membership in the European Union, and in June 2022, it received candidate status along with seven relevant recommendations in all spheres of human activity, including recommendation no. 7 on completion of the reform of legislation in the field of national minorities and interethnic relations. 

    To implement these recommendations, Ukraine developed and approved three laws, including the new law on national minorities (communities) of Ukraine, as well as 16 subordinate regulatory legal acts (bylaws) approved by the Government.

    In concluding remarks, Ibrahima Guisse, Committee Expert and Co-Rapporteur, thanked the delegation for the dialogue held, particularly given the context.  War was ended through negotiation and diplomacy, not capitulation. It was hoped this would happen with Ukraine.  The fact that Ukraine was here before the Committee was an example of the State’s willingness to cooperate.

    In his concluding remarks, Mr. Lossovskyi thanked the Committee for their time and interest in the situation in Ukraine.  The Committee’s recommendations were very much appreciated. 

    The delegation of Ukraine consisted of representatives of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience; the Coordination Centre for Legal Aid Provision; the State Committee for Television and Radio Broadcasting of Ukraine; and the Permanent Mission of Ukraine to the United Nations Office at Geneva.

    The Committee will issue its concluding observations on the report of Ukraine after the conclusion of its one hundred and fifteenth session on 9 May 2025.  The programme of work and other documents related to the session can be found here.  Summaries of the public meetings of the Committee can be found here, while webcasts of the public meetings can be found here.

    The Committee will next meet in public on Friday, 25 April at 3.p.m for a half day general discussion on reparations for the injustices from the transatlantic trade of enslaved Africans, their treatment as chattel, and the ongoing harms to and crimes against people of African descent.

    Report

    The Committee has before it the combined twenty-fourth to twenty-sixth periodic reports of Ukraine (CERD/C/UKR/24-26).

    Presentation of Report

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said during the reporting period from 2014 to 2019, fundamental tragic changes took place in Ukraine, in particular the beginning of the Russian aggression, Russia’s brazen destruction of international law, the occupation of the Autonomous Republic of Crimea and the city of Sevastopol, the occupation by the Armed Forces of the Russian Federation and terrorist organizations supported by it of certain parts of the Donetsk and Luhansk regions, as well as the financing by the Russian Federation of terrorist organizations of the occupation administrations. 

    Due to these circumstances, collecting information in the temporarily occupied territories of Ukraine was difficult. As a result of the temporary occupation of the Autonomous Republic of Crimea and the city of Sevastopol by the Russian Federation, and the aggression of the Russian Federation in eastern Ukraine, ensuring the rights of minorities in these areas, especially Crimea, had sharply deteriorated.  Ukrainians and Crimean Tatars, and those who adhered to pro-Ukrainian views, were subject to discrimination in Crimea. 

    During the reporting period, important changes also took place in the religious sphere in Ukraine.  On 15 December 2018, the Unification Council was held, at which representatives of the three Orthodox Churches of Ukraine united into a single church structure, which was called the “Orthodox Church of Ukraine”, and the Metropolitan Epiphany of Kyiv and All Ukraine was elected as its primate.  As of the beginning of 2021, this church jurisdiction had 7,097 religious organizations on the territory of Ukraine, handled by 4,537 clergy. 

    The principles of preventing and combatting discrimination were defined by the 2012 law on the principles of preventing and combatting discrimination in Ukraine.  In May 2014, amendments were made to the law, which improved the legislative definition of discrimination.  In 2019, the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience was established to deal with State policy in the field of national minorities and interethnic relations, freedom of conscience, and freedom of religion. 

    At the height of the Russian invasion, in April 2022, Ukraine applied for membership in the European Union, and in June 2022, it received candidate status along with seven relevant recommendations in all spheres of human activity, including recommendation no. 7 on completion of the reform of legislation in the field of national minorities and interethnic relations.  To implement these recommendations, Ukraine developed and approved three laws, including the new law on national minorities (communities) of Ukraine, as well as 16 subordinate regulatory legal acts (bylaws) approved by the Government. 

    The first stages of the negotiation process with the European Commission regarding Ukraine’s membership in the European Union took place, in particular, the screening of Ukrainian legislation for its compliance with European legislation.  The screening was provided under four subsections on judiciary and fundamental rights: freedom of conscience, freedom of religion; racism, xenophobia, hate speech; racial and ethnic discrimination, including Roma; and rights of national minorities. 

    Based on the results, the European Commission prepared a positive report on the state of Ukrainian legislation and its compliance with European legislation in October 2024.  The next stage of the negotiation process was the preparation of strategic documents, including an action plan to ensure the rights of national minorities in Ukraine, which were in the final stage of preparation. 

    Questions by Committee Experts

    IBRAHIMA GUISSE, Committee Expert and Co-Rapporteur, welcomed that Ukraine had a diverse and high-level delegation.  Ukraine’s presence before the Committee despite the difficult context in the country highlighted the country’s commitment to appear before the treaty bodies. Mr. Guisse then paid tribute to Pope Francis who had been a man of peace. 

    During the period under review, Ukraine had experienced deep upheavals, including the large-scale invasion in 2022, which had given rise to large-scale destruction, human loss and mass displacement. According to information before the Committee, the last census conducted in 2001 showed that the main minority groups included Russians, Belarusians, Moldovans, Crimean Tatars and Bulgarians. Ukraine also has smaller populations of Poles, Romanians, Armenians, Hungarians, Roma and other nationalities.  A subsequent census was supposed to be conducted in 2011, which was postponed until 2020, and had not taken place until now. 

    Other data was also not provided, and the Committee emphasised that the lack of statistics limited the ability to evaluate the enjoyment of different groups of their economic, social and cultural rights.  Were there plans to conduct the census based on the principle of self-identification? What were the measures planned to collect data on the enjoyment of economic and social rights by the different groups under the jurisdiction of the State party? 

    The Committee noted that the legal framework, particularly on principles of preventing and combatting discrimination in Ukraine, did not prohibit discrimination based on all grounds listed in the Convention, particularly national origin and descent.  Were there plans to amend and align the national legislation framework with article 1 of the Convention?  What measures were taken to ensure that the legislative framework prohibited intersecting forms of discrimination? 

    Could the delegation inform the Committee on the implementation of the national human rights strategy for 2015–2020 in 2015 and its action plan?  Was there a timeframe for developing and adopting a strategy on combatting racial discrimination?

    Could the delegation provide information on the mandate and activities of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience?  What were the measures to ensure the consultation and participation of groups vulnerable to racial discrimination in the work of the State Service?  Was the State party planning to establish a central mechanism to coordinate and monitor the implementation of measures designed to combat racial discrimination?

     

    The Committee was concerned that the legislative framework, including the Criminal Code, did not include a definition of all forms of discrimination, or a specific definition of hate speech or sanction for hate speech and crimes.  What measures were being undertaken to review and amend the legislative framework to prohibit all forms of racial discrimination, hate speech and hate crimes in accordance with the Convention? 

    Was the State party planning to amend its Criminal Code, particularly article 161, to remove the requirements and restrictive approach as recommended by the Committee in 2016?  What was the status of the draft law no. 5488 before the Parliament?  How were its provisions in line with the Convention?   

    Could information be provided on the legislative framework on combatting racial discrimination in political discourse, as well as information on complaints received, investigations initiated, and imposed sanctions in this field?  The Committee noted that the law on media included provisions on discrimination and incitement to hatred.  Could clarifications on the law and how its provisions aligned with the Convention be provided?  Could the delegation inform the Committee about measures taken to combat hate speech in the media and over the Internet?  Was there a designated entity to monitor hate speech or avenues to submit complaints by victims? 

    Responses by the Delegation 

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said unfortunately, the last census of Ukraine had taken place in 2001, which was 24 years ago.  There were several reasons for this, including two Ukrainian political revolutions during this time and the beginning of the war with Russia in 2014. The next census had been planned for 2023, but this had been postponed due to the full-scale invasion by the Russian Federation in 2022.  It was impossible in current circumstances to hold another census. 

    Significant work in combatting racial discrimination had been undertaken in the past three to four years.  The State Service of Ukraine for Ethnic Affairs and Freedom of Conscience was established in 2019 and began its work in 2020. The institute directly dealt with issues of national minorities and ethnic policies and consisted of around 40 people. 

    Over the past couple of years, three laws had been adopted by the parliament, including the new law on national minority communities of Ukraine.  This new law was revolutionary, as it described the ethnic policy for Ukraine and prescribed tasks for the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience. According to the law, all those who considered themselves to be national minorities would be recognised by the State as such.  Ukraine had 130 national minorities, and the State took responsibility for all these communities. 

    There was a lack of strict definitions in Ukrainian laws around hate speech and hate crimes.  Ukrainian institutions were working hard to integrate these into Ukrainian legislation.  There was an interagency working group dealing with issues of discrimination, hate speech and hate crime. 

    Questions by Committee Experts

    IBRAHIMA GUISSE, Committee Expert and Co-Rapporteur, appreciated the answers given, noting the circumstances within the country.

    CHINSUNG CHUNG, Committee Expert and Co-Rapporteur, asked for more details on the interagency working group to be provided?  Could more information on the national human rights institution be provided? 

    A Committee Expert said Ukraine’s non-compliance with article 4 was an ongoing issue.  It was strongly recommended that the State follow up on this. 

    Another Expert asked how effective the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience had been in protecting minority rights in Ukraine?  What was the level of participation of national minorities in consultations on State decisions?  Had there been any improvements based on these discussions? 

    A Committee Expert said the situation in Ukraine was incomprehensible.  What could be done about hate speech?  Did Russian people hate Ukrainian people?  Personally, the Expert did not feel this was the case. How could this explain why not everyone opposed the war which continued to take more lives?  While there was hatred, men would continue to wage war. 

     

    FAITH DIKELEDI PANSY TLAKULA, Committee Expert and Follow-Up Rapporteur, expressed gratitude to the State party for responding to the Committee’s request in the one-year time frame, however, many questions by the Committee were not addressed, nor were they provided in the current State report.  Could the State party provide the Committee with the previously requested information in paragraph 16 of the concluding observations? 

    Responses by the Delegation 

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said the questions about the war were philosophical.  This was an existential war for the Ukrainian nation. According to the Russian dictator, Ukrainians did not exist and needed to be re-educated.  To stop the war, the Russian dictator should provide a decree to forces to stop the fight and withdraw from the territory of Ukraine. 

    The Commissioner of Human Rights had a special department focusing on discrimination.  After the screening exercise with the European Union, Ukraine understood there were some gaps in its legislation, particularly when it came to definitions.  Many new laws and bylaws had been approved to fill these gaps, and this was a key focus of the State Service for Ethnic Affairs and Freedom of Conscience. Communication with national minorities was a key step in this regard. 

    Around seven million Ukrainians had left Ukraine as refugees or moved around Ukraine as internally displaced persons. Many people treated the Roma community differently.  The national action plan for the Roma strategy to 2030 was evaluated every two years. Every year, many different roundtables and conferences were organised by the State on the Roma community. 

    Two forums had been organised for the different minorities to discuss any issues they had and how to address them. A forum was organised in Kiev with Polish national minorities, and another one with Greek national minorities. There was a strategy on the development of the Crimea Tartare language.  This year, work had also been finished on the new spelling of the Crimean Tartare language. 

    Questions by Committee Experts

    CHINSUNG CHUNG, Committee Expert and Co-Rapporteur, asked about concrete cases of racially motivated violence and racial profiling, and the measures taken to respond to these cases?  What measures had been taken for increasing public awareness-raising campaigns and other measures to counter incitement to hatred and hate crimes?  The Committee would also like to receive information on measures to prevent discriminatory violence by the police and other law enforcement officers; measures to ensure accountability for incidents of discriminatory violence; and data on these kinds of incidents?

    The Committee was concerned about racist hate speech and discriminatory statements in the public discourse, including by public and political figures and in the media.  How did these victims address their cases, and how effectively were these cases treated?  How many complaints had been received in the last five years, and what was the number of investigations initiated, cases considered before courts, and sanctions imposed on perpetrators?  Could detailed information be provided on complaints registered with the courts, or any other national institution, including the Ukrainian Parliament Commissioner for Human Rights, concerning acts of racial discrimination, racist hate speech and racist hate crimes?

    According to information before the Committee, there were gaps in the implementation of the legal framework, including the lack of specialisation among law enforcement officials and lack of operational standards to handle, register and investigate complaints of racial discrimination and hate crimes.  What measures were being taken to address these concerns, particularly to enhance the capacity of law enforcement officials in handling and investigating complaints related to racial discrimination and hate speech? 

    Information before the Committee indicated that there was a lack of awareness on the rights of victims of racial discrimination and fear of approaching law enforcement officials on this topic.  What measures were being taken to address these issues?  Could a reason be provided for the low rate of complaints at the National Human Rights Commission?  What measures were being taken to enable victims to make complaints more effectively? 

    The Committee welcomed the adoption of amendments in 2024 on the law on free legal aid to allow victims of hate crimes on specific grounds to benefit from secondary legal aid.  However, the information before the Committee indicated that the victims were only entitled to the legal aid at the secondary stage and not to initiate a complaint.  In addition, the implementation of the amendment was postponed until one year after the martial law was abolished.  Could the delegation provide information on these two concerns? 

    Could disaggregated data be provided on complaints by ethnic origin such as by Roma, Jews, Africans and other minorities, as well as by national origin and gender?  Had the complaints changed during the armed conflict, in terms of quantity, nature and results?  What measures were being taken to promote human rights education, including on racial discrimination, in university programmes and teacher training?

    What measures were being taken to raise awareness of the public, civil servants, and law enforcement officials in order to combat societal prejudice against certain minority groups, including the Roma?

    Could accurate statistics of ethnic minorities, including Roma, be provided?  The Committee remained concerned at the persistence of discrimination, stereotypes and prejudices against Roma, including reports of physical attacks and killings. 

    Recent research also demonstrated that the level of antigypsyism in Ukraine was still very high.  According to the social cohesion study, 35 per cent of the Ukrainian population did not want Roma to be in their community at all. What measures had the Government of Ukraine taken to fight antigypsyism? 

    Could data on the education conditions of Roma be provided?  What measures had been taken for improving the situation of education for Roma children? Were they educated in their mother tongue without discrimination?

    The Committee noted the various measures taken by the State party to improve the situation of Roma, including the strategy for the protection and integration of the Roma national minority to 2020 and its action plan.  Could information on the progress and results of strategies and programmes directed at the Roma be provided, particularly the allocated resources to ensure the effective implementation of the strategy and action plan and monitoring of its implementation?  How were members of the Roma ethnic minorities involved in the implementation and monitoring of these policies?  Had the Government consulted with Roma communities when planning and implementing such integration measures, including at the local level?  How were the low levels of funding for these plans being addressed? 

    Responses by the Delegation

    The delegation said the issues affecting the Roma community were a problem, not just for Ukraine but for all European countries.  Prejudices still existed, however, during the war, many Roma men had served in the Ukrainian armed forces and in some cases sacrificed their lives, which had changed the attitude of Ukrainians towards Roma people.  A unity and diversity programme was implemented last year, which was a Ukrainian national cultural programme, with training for Ukrainian police officers. 

    The lack of documents in Roma communities was an issue but this was being addressed through regular visits to regions where the Roma community lived.  Thousands of Roma people had been provided with new documents.

    In 2023, around 60 consultations were organised with different national minority groups.  Permanent consultations and meetings were held with Roma communities. The consultations included members of all relevant ministries.  The next meeting had been planned for the end of April.  April 8 was International Roma Day and a large event had been organised in Kiev, including a roundtable and an all-day conference with the participation of ambassadors and the diplomatic corps.  On the same day, several regions also organised International Roma Day celebrations with different events. 

    Questions by Committee Experts

    A Committee Expert said the implementation of the Committee’s recommendations were lacking.  How were the stakeholders in the consultations selected? The Expert expressed hope that the war would end soon with a fair and sustainable solution.  It was important to remember that the unity towards Roma people should be sustained after the war, and that the stereotypes did not return. 

    FAITH DIKELEDI PANSY TLAKULA, Committee Expert and Follow-Up Rapporteur, said the Committee’s recommendations regarding measures taken to conduct training to raise awareness on the amendments to article 161 of the Criminal Code had not been addressed, and urged the State party to provide this information. 

    Another Expert asked what existing mechanisms were in place to receive complaints from victims of hate crimes? Were they user friendly?

    A Committee Expert asked whether the education system in the State party allowed for the type of education help to prevent hate crimes and racial intolerance for children?  Were there any significant numbers of people of African descent in the State party?  Would Ukraine support the Second Decade for People of African Descent? 

    IBRAHIMA GUISSE, Committee Expert and Co-Rapporteur, asked if Ukraine’s desire to align itself with the European Union’s legislation on hate speech was to address hate speech, or to bring its legislation into line with that of the European Union? 

    An Expert asked if the outcome of today’s dialogue would be brought to the attention of the media?

    Responses by the Delegation

    The delegation said if the Committee approved, Ukraine would provide information to the media about the meeting. Regardless of the ethnicity or culture of any citizen, they could contact the police and make a complaint. There were special school curricula on tolerance and education.  There should be more education in schools, from the youngest level possible. 

    There was an African community in Ukraine; it was not very big but its members were consulted on many issues. The African community had never informed the Government about any issues when dealing with the Ukrainian community. 

    The legal aid system of Ukraine provided several services, including primary and secondary legal aid and access to alternative dispute resolutions.  Regular targeted information campaigns were conducted on the right to legal aid, to provide empowerment for vulnerable groups and build trust in the legal aid system in Ukraine.  There had been only 91 cases of requests for legal aid during the past three years.  There were 500 legal aid centres across Ukraine, as well as an online service. 

    Six months ago, the Government adopted the list of the languages of the national minorities of Ukraine which were under threat of disappearance, and this included the Roma language. Currently, there was a special working group of experts who were familiar with these languages working on initiatives in this regard.

    In a brief comment at the end of the first meeting, MICHAL BALCERZAK, Committee Chair, said the dialogue was public and it was up to Ukraine if it wished to produce information on the discussion. 

    Questions by Committee Experts

    IBRAHIMA GUISSE, Committee Expert and Co-Rapporteur, asked if measures were planned to assess and review the law on national minorities (communities) of Ukraine that aimed to eliminate all discriminatory provisions?  What measures had been taken to consult and ensure the participation of all ethnic and national minority groups in the process of developing and drafting the law and its amendments? 

    While noting the measures taken by the State party to protect Crimean Tatars, in particular those who fled Crimea after 2014, the Committee remained concerned about reports that Crimean Tatars in regions under the authority of the State party faced difficulties in accessing employment, social services and education, and did not receive assistance. What mechanisms had been developed to ensure consultations with ethnic minority groups? 

    Did the State party have information concerning the National Council for Interethnic Harmony?  What measures had been taken by the State party to support women belonging to ethnic or national minority groups in exercising their political rights, including participation in public affairs and raising awareness on their rights and the vital impact of their participation?  What measures were being taken to mitigate the impact of the ongoing conflict on the participation of women in politics?   

     

    According to information received, legislative amendments relating to religious organizations entered into force on 23 September 2024, invoking “national security” as a ground for restricting freedom of religion or belief and freedom of religious association. However, this was not considered a permissible grounds for restriction of freedom of religion under the Convention. What were the measures restricting freedom of religion and belief and their impact on the ethno-religious communities concerned?  Information received referred to practices tending to prohibit the activities of religious organizations, specifically the activities of the Russian Orthodox Church. Could information be provided on the necessity and proportionality of such punitive measures?

    The situation of migrants, asylum seekers, refugees, and stateless persons in Ukraine had been significantly impacted by recent legal and practical developments, particularly since the introduction of martial law in February 2022.  The current legal framework and its implementation presented several challenges that were inconsistent with the Convention. 

    The refugee status determination process in Ukraine did not align with international standards, leading to inconsistent application of legal interpretations and time limits for lodging asylum applications.  This often resulted in the rejection of asylum claims.  New practices had restricted access to asylum and statelessness determination procedures, especially for individuals with ties to the Russian Federation and Belarus.  The State Migration Service often issued oral refusals for asylum applications without official decisions, citing martial law as a reason.  This practice had been recognised by courts as illegal, yet it persisted, leaving applicants in legal limbo.

    How would Ukraine address the inconsistencies in the asylum procedures to ensure alignment with international standards and the Convention?  What legal amendments were introduced under martial law and what was their impact on the rights of refugees and stateless persons?  What procedural safeguards were in place to protect individuals from forcible deportation?  What steps were being taken to improve access to the asylum and statelessness determination procedures, particularly for individuals with ties to the Russian Federation and Belarus? 

    How was the Government addressing the challenges posed by the suspension of diplomatic relations with Russia in verifying nationality in statelessness determination procedures?  What plans did the Ukrainian Government have to develop an integration strategy for refugees and improve reception conditions for asylum seekers?  What steps were being taken to address the unlawful practice of issuing verbal refusals for asylum applications and ensure that applicants received official decisions?

    The Government of Ukraine had made significant strides in addressing statelessness since 2020, including the introduction of a statelessness determination procedure. Despite these efforts, several challenges remained, particularly in the implementation of the procedure and the accessibility of necessary documentation for applicants, which was further exacerbated by the conflict. 

    On 22 January 2024, draft law no. 11469, titled “on amendments to certain laws of Ukraine on ensuring the right to acquire and preserve Ukrainian citizenship” was registered in the Ukrainian Parliament.  The draft law, if passed, could result in the loss of Ukrainian citizenship for residents in Russian-occupied Ukrainian territories, who often had to obtain Russian passports to access basic services, employment, and social benefits. How did the Ukrainian Government plan to address the potential risk of stripping Ukrainian citizenship from residents of occupied territories who acquired Russian citizenship under duress or due to essential needs, such as access to basic services and employment?

    MICHAL BALCERZAK, Committee Chair, said Kiev had been under attack the night before and there had been casualties.  This was a serious and sad situation.  The Committee understood the situation and was very concerned about these tragic events. 

    Responses by the Delegation

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said many members of the delegation had barely slept the night before. Russia had launched missiles from the Black Sea and inside Russia and had bombed Kiev.  Up to now, there were 10 citizens who had been killed and 100 wounded, including children.  Every day, there were peaceful victims of this tragic and bloody war.  The delegation in Ukraine had lost contact with the Committee at the beginning of the session and missed some questions.

    Regarding the law on ethnic minorities, several meetings had been organised with national minorities during the development of the law, predominantly online due to the war.  In December 2022, Parliament adopted the law. At the request of some national minority organizations, the State used the term “communities” instead of minorities. The law encompassed all groups of ethnic peoples, which was around 130 according to the most recent census. 

    Ukraine did not have many new asylum seekers as the situation in the country was not sustainable for a peaceful life. 

    The Ombudsman’s Office was referred to as the Parliamentary Commission of Human Rights.  The independence of this Office was guaranteed, ensuring it could function without undue influence from any external entities.  This enabled the Office to effectively address human rights and issues of non-discrimination.  Its annual report outlined steps taken to combat discrimination. It was a large institution with around 500 employees.  There were branches located across 24 regions of Ukraine.  In 2024, there were 454 complaints received by the Office.  The Office monitored all issues of non-discrimination.  All reports of the Office were public and could be found online.   

    Questions by Committee Experts

    IBRAHIMA GUISSE, Committee Expert and Co-Rapporteur, expressed sorrow at the recent shocking events which had wracked the Ukrainian capital.  What was the impact of martial law on asylum seekers, refugees and stateless persons? 

    CHINSUNG CHUNG, Committee Expert and Co-Rapporteur, asked about the situation of lesbian, gay, bisexual, transgender and intersex persons belonging to minority groups, as well as the situation of elderly people belonging to these groups?  What was the situation of migrant workers, particularly in this situation of armed conflict?

    A Committee Expert asked how far Ukraine had gone in implementing the decision of the European Court of Human Rights on a case versus Ukraine?   

    Another Committee Expert congratulated the Ukrainian delegation for making a laudable effort to assess the implementation of the Convention in Ukraine, despite prevailing circumstances. Ukraine should be praised for this effort.  The Expert was concerned about allegations of racism at the Ukrainian Polish border. Had there been any follow-up on such reports?  How many cases had been brought to court? 

    There had been allegations of racism in sport, including with a Brazilian footballer who was banned for one game after reacting to crowds calling him monkey.  How had this case been handled?  Ukraine should be congratulated for adopting the law on stateless in 2021.  How many individuals had benefitted from the enforcement of that law?  How did the State party plan to provide Roma with national documents? 

    Another Expert said African nationals had been facing discrimination at the borders. 

    What measures were being taken by the State party to ensure the protection, safety and security of all persons living in its jurisdiction? 

    Responses by the Delegation

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said Ukrainian legislation underscored equal rights for men and women. Half of the ministers of the Government were women.  Many women in Ukrainian society occupied high-level positions.  Women from Roma communities were among the most vulnerable. The State had organised several events, including roundtables, which assisted Roma women to find their place in society. 

    Due to the war, Ukraine no longer had many migrant workers.  It was hoped that this would change after the war.  The country would need many workers for innovation and to help rebuild Ukraine. It was hoped workers from many countries would come to Ukraine after the war and help rebuild the hundreds of cities which had been destroyed or partially destroyed. 

    Mr. Lossovskyi said he had not heard of cases of discrimination on the border between Ukraine and Poland.  The case of discrimination regarding the Brazilian football player was an awful occurrence which was not typical for Ukraine. There had been a police investigation, but he could not recall the exact outcome. 

    The delegation said the aggression by the Russian federation had led to a huge influx across Ukraine’s borders. The Government took all accounts of discriminatory treatment very seriously.  Despite difficult conditions, the Government had managed to keep all checkpoints on the borders open. 

    Mr. Lossovskyi said in 2022, a pilot project was launched to provide documents to Roma people in a more effective way.  This was organised in a region where the majority of Roma people lived.  Every year, the State continued this work and made several visits to these places. 

    The delegation said the draft law 5488 was being considered before parliament.  It was hoped the law would be adopted during the current session of Parliament.  The draft law provided for the term “intolerance” and addressed issues under this topic.  All law enforcement agencies were currently working together to introduce the necessary amendments to the Criminal Code.  Police officers had completed specialised human rights training.  Outreach activities, including in schools, were carried out to combat negative stereotypes on the Roma population. 

    Questions by Committee Experts

    CHINSUNG CHUNG, Committee Expert and Co-Rapporteur, said the Committee believed in the necessity of investigating and documenting all human rights violations and abuses committed in the context of the ongoing armed conflict and invasion initiated by the Russian Federation against the State party on 24 February 2022.  What measures had been taken to ensure prompt and impartial investigations?  Could the delegation provide information on investigations and prosecutions into allegations of human rights violations and abuses during the armed conflict with the Russian Federation?

     

    On 11 October 2018, the Holy and Sacred Synod of the Istanbul-based Ecumenical Patriarchate granted autocephaly to a new church, the “Orthodox Church of Ukraine”.  This led to tensions with the Ukrainian Orthodox Church.  The Church was formerly linked to the Russian Orthodox Church under the Patriarch in Moscow, but stated that it severed those ties in May 2022, following the full-scale invasion by the Russian Federation. 

    It was reported that on 23 September 2024 in territory controlled by the Government of Ukraine, new legal provisions regarding religious organizations entered into force, prohibiting the activities of foreign religious organizations based in a State responsible for armed aggression against Ukraine or occupation of its territory, and specifically prohibiting the activities of the Russian Orthodox Church. Could detailed explanations be provided on this and on measures to ensure the respect of the rights to freedom of thought, conscience and religion?

    According to media reports in January 2025, the State party announced the capturing in Russia of two soldiers from the Democratic People’s Republic of Korea, and indicated that they were detained and provided with medical care.  Could the delegation provide information on the situation of these two prisoners of war? What were the legal measures taken against them?  Were there more prisoners of war captured by the State party from other nationalities, including mercenaries? 

    The Committee noted that the State party adopted the law on indigenous peoples in 2021.  However, according to information before the Committee, the law only recognised Crimean Tatars, Karaims and Krymchaks as indigenous peoples in Ukraine, while excluding other groups, such as Hutsuls, Lemkos and Gagauz peoples.  Could the delegation provide clarifications on the law on indigenous peoples and how it aligned with international standards?

    Were there plans to assess and review the law?  What was the situation of the Hutsuls, Lemkos and Gagauz peoples?  What measures were in place to preserve and promote the identity, language and culture of all indigenous people under the jurisdiction of the State party?  Could information be provided on the situation of internally displaced Crimean Tatars, and measures to ensure their access to education, housing, employment, healthcare services and humanitarian assistance?  Was the State party taking measures in consultation with the Crimean Tatar community to find durable solutions for an appropriate settlement of Crimean Tatars in Ukraine?

    The Committee was concerned that during the war, persons belonging to minorities, such as Roma, had difficulties in registering as internally displaced persons and having access to social assistance.  According to the representative of the Office of the Ombudsman of Ukraine, around 100,000 Roma became refugees, and around the same number of Ukrainian Roma became internally displaced persons.  Were accurate statistics available on the Roma?  Did the State party find durable solutions for internally displaced Roma and take measures to ensure that they benefitted from assistance?  What were the State’s plans to include Roma people in recovery and reconstruction programmes?

    What efforts were being made to restore linkages between displaced children and their families?  What efforts were being made to ensure access to education and basic services for displaced children?

    Ukraine’s inadequate response to hate crimes against migrants, African and Asian students and other foreigners had previously attracted international criticism.  What was the situation of non-citizens, particularly migrants, refugees and asylum seekers, and people of African and/or Asian descent during the armed conflict?  Could the delegation provide clarification on the situation of detained undocumented migrants and non-citizens?  Could the delegation also please provide information on measures to ensure their access to education, housing, employment, healthcare services and humanitarian assistance?

    Responses by the Delegation

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said Ukraine did not refer to what was going on in Ukraine as conflict. This was a bloody, existential, colonial war with Russia, not simply a conflict.  In 2018, the Ukrainian Church received independence from the Patriarchal Eastern Christianity Church based in Istanbul, Türkiye.  This was a revolutionary decision, as Ukraine was a big country and did not have an orthodox church.  Now there was an independent church of Ukraine, like all other Christian Orthodox countries.  No other activities of other churches were forbidden in Ukraine.  The only restrictions were for the Russian Orthodox Church, which had restricted activity on the territory of Ukraine. This was because it was an accompaniment of the Russian aggression which had destroyed the country and killed hundreds of thousands of people. 

    Ukraine provided the international standard for prisoners of war in their prison facilities, which were regularly visited by the Ukrainian Ombudsman.  In 2021, Ukraine adopted the law on indigenous peoples and consulted with many minorities on this law.  Indigenous peoples were defined as those who lived on the territory of Ukraine and did not have a mother country.  The Lemkos people were not considered a national minority group, but rather a cultural group. 

    In 2021, the Ukrainian Government approved the Roma strategy, and every two years action plans were prepared for its implementation.  The Roma community was a young community, one of the youngest among the national minorities in Ukraine.  It would be beneficial to use their innovation and abilities in the process of renovating Ukraine when the war was over.  The State was working on providing the Roma with more education.  There were many grants provided to Roma for studying in universities. 

    The delegation said in 2021, the Ukrainian Parliament adopted the law on indigenous people in Ukraine, which was developed through extensive consultations with indigenous groups and civil society, and represented the aspirations of these groups.  In addition, a draft law was developed on the status of the Crimean Tartar people which would be registered in Parliament in the near future. 

    To ensure prisoners of war were not tortured, relevant legislation and policies had been developed.  Three legislative acts had been produced to regulate these affairs. 

    Questions by Committee Experts

    CHINSUNG CHUNG, Committee Expert and Co-Rapporteur, asked if there were representative bodies of minorities inside the Cabinet of Ministers of Ukraine?  How did the State party ensure consultations with all indigenous peoples under the framework of this law? 

    Another Expert said 10 to 20 per cent of Ukrainian Roma did not have identity documents?  Was there a provision for determining statelessness in the act on statelessness?  Did the Roma community benefit from universal birth registration? 

    A Committee Expert asked how many of the ethnic and national minorities participated in the relevant bodies in the Government?  How many Roma, indigenous, or migrant women had been hired or granted responsibility positions, or were integrated in the responsibility of the work? 

    Responses by the Delegation

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, said when the law on indigenous peoples was adopted, several bylaws were prepared for the implementation of the law.  According to one of the bylaws, Crimean Tatars regularly consulted with the Government.  Only during the population census could the Government request information about the ethnic groups.  Sometimes women with high-ranking positions did not disclose their ethnicity.  It was up to people to declare this. 

    The delegation said due to the Russian full-scale invasion, there were problems preparing full statistical information on ethnic minorities.  The legal aid system in Ukraine had provided legal assistance to more than 1,000 Roma people over the past three years.  Most of these related to the processing of identity documents.  Secondary legal aid had been provided for 27,000 internally displaced people over the past three years, due to the full-scale invasion. 

    Officially, Ukraine recognised three indigenous groups of peoples, including Crimean Tartars, Karaims and Krymchaks.  Crimean Tartars were represented by an executive body; the spiritual administration of Ukraine represented the Karaim people; and there was no official information regarding a body for the Krymchaks, although they had the full rights to establish such a body under law. 

    Currently, there was no definition of hate speech under Ukrainian law.  The Government of Ukraine had prepared a draft roadmap covering this issue. In Ukraine, a working group made up of State authorities and public organizations was working on a definition of hate speech and establishing administrative and criminal liability depending on the severity of the crime. 

    The public broadcaster of Ukraine continued to create a single information space for minorities.  The broadcaster produced programmes for national minorities in their national languages, across broadcast, radio and digital formats.  The State bodies would do their best to cover all the information needs of the national minorities in Ukraine. 

    Closing Remarks

    FAITH DIKELEDI PANSY TLAKULA, Committee Expert and Follow-Up Rapporteur, said the Committee would send Ukraine concluding observations after the dialogue, with specific recommendations to be enacted within a period of one year. 

    IBRAHIMA GUISSE, Committee Expert and Co-Rapporteur, thanked the delegation for the dialogue held, particularly given the context.  War was ended through negotiation and diplomacy, not capitulation.  It was hoped this would happen with Ukraine. The fact that Ukraine was here before the Committee was an example of the State’s willingness to cooperate. Ukraine was also meeting with the Committee against Torture at the same time, which may have weakened Ukraine’s ability to provide comprehensive answers. 

    IHOR LOSSOVSKYI, Deputy Head of the State Service of Ukraine for Ethnic Affairs and Freedom of Conscience, thanked the Committee members for their time and interest in the situation in Ukraine.  The Committee’s recommendations were very much appreciated. 

    MICHAL BALCERZAK, Committee Chair, said racial discrimination was about ethnic and national origin.  The Committee was concerned when ethnic minorities were denied their identity.  This led to wars.  It was now the sixtieth anniversary of the Convention, and the first composition of the Committee had included an expert of Ukrainian origin.

    ___________

    Produced by the United Nations Information Service in Geneva for use of the media; 
    not an official record. English and French versions of our releases are different as they are the product of two separate coverage teams that work independently.

     

    CERD25.002E

    MIL OSI United Nations News

  • MIL-OSI USA: Payroll Services Company Owner Sentenced to Prison

    Source: US State of Vermont

    Defendant Defrauded the United States of More than $20M in Taxes While Amassing a Large Collection of Luxury Goods Including 27 Ferraris

    A Florida man was sentenced today to 50 months in prison for not paying taxes withheld from his employees’ wages and filing a false tax return.

    The following is according to court documents and statements made in court: Matthew Brown, of Palm Beach Gardens, Florida, owned and operated multiple businesses in and around Martin County, Florida. One of these businesses was a payroll services company known as Elite Payroll. Elite Payroll provided payroll services to small businesses in and around St. Lucie, Martin, and Palm Beach Counties. Elite Payroll was hired by its clients to collect and pay over the Social Security, Medicare, and federal income taxes withheld from clients’ employees’ wages and to pay over those funds to the IRS each quarter. The timely payment of these taxes is critical to the functioning of the U.S. government, including because they are the primary source of funding for Social Security and Medicare. The federal income taxes that are withheld from employees’ wages also account for a significant portion of all federal income taxes collected each year.

    Between 2014 and 2022, Brown did not pay over $20,000,000 in taxes withheld from the wages of employees of clients of Elite Payroll and from other businesses he controlled and instead enriched himself. To effectuate his scheme, Brown charged his clients the full amount of their tax liabilities but then filed false employment tax returns with the IRS that substantially underreported their liabilities, and pocketing the difference. For example, for one quarter in 2021, a client owed approximately $219,000 in taxes. Elite Payroll collected that amount from the client but filed a false tax return with the IRS claiming that the client only owed approximately $32,000, which Elite paid. Brown then kept the remaining approximately $190,000.

    Instead of paying over the funds, Brown purchased commercial and residential real estate, including his multimillion-dollar home, a Valhalla 55 Sport Yacht, a Falcon 50 Aircraft, and a large collection of cars including Porsches, Rolls Royces, and 27 Ferraris.

    In addition to his prison sentence, U.S. District Judge Aileen M. Cannon for the Southern District of Florida ordered Brown to serve two years of supervised release and to pay $22,401,585 in restitution, and a $200,000 fine to the United States.

    Acting Deputy Assistant Attorney Karen E. Kelly of the Justice Department’s Tax Division and U.S. Attorney Hayden O’Bryne of the Southern District of Florida made the announcement.

    IRS Criminal Investigation investigated the case.

    Trial Attorney Andrew Ascencio of the Tax Division and Assistant U.S. Attorney Michael Porter for the Southern District of Florida prosecuted the case.

    MIL OSI USA News

  • MIL-OSI Security: Payroll Services Company Owner Sentenced to Prison

    Source: United States Attorneys General

    Defendant Defrauded the United States of More than $20M in Taxes While Amassing a Large Collection of Luxury Goods Including 27 Ferraris

    A Florida man was sentenced today to 50 months in prison for not paying taxes withheld from his employees’ wages and filing a false tax return.

    The following is according to court documents and statements made in court: Matthew Brown, of Palm Beach Gardens, Florida, owned and operated multiple businesses in and around Martin County, Florida. One of these businesses was a payroll services company known as Elite Payroll. Elite Payroll provided payroll services to small businesses in and around St. Lucie, Martin, and Palm Beach Counties. Elite Payroll was hired by its clients to collect and pay over the Social Security, Medicare, and federal income taxes withheld from clients’ employees’ wages and to pay over those funds to the IRS each quarter. The timely payment of these taxes is critical to the functioning of the U.S. government, including because they are the primary source of funding for Social Security and Medicare. The federal income taxes that are withheld from employees’ wages also account for a significant portion of all federal income taxes collected each year.

    Between 2014 and 2022, Brown did not pay over $20,000,000 in taxes withheld from the wages of employees of clients of Elite Payroll and from other businesses he controlled and instead enriched himself. To effectuate his scheme, Brown charged his clients the full amount of their tax liabilities but then filed false employment tax returns with the IRS that substantially underreported their liabilities, and pocketing the difference. For example, for one quarter in 2021, a client owed approximately $219,000 in taxes. Elite Payroll collected that amount from the client but filed a false tax return with the IRS claiming that the client only owed approximately $32,000, which Elite paid. Brown then kept the remaining approximately $190,000.

    Instead of paying over the funds, Brown purchased commercial and residential real estate, including his multimillion-dollar home, a Valhalla 55 Sport Yacht, a Falcon 50 Aircraft, and a large collection of cars including Porsches, Rolls Royces, and 27 Ferraris.

    In addition to his prison sentence, U.S. District Judge Aileen M. Cannon for the Southern District of Florida ordered Brown to serve two years of supervised release and to pay $22,401,585 in restitution, and a $200,000 fine to the United States.

    Acting Deputy Assistant Attorney Karen E. Kelly of the Justice Department’s Tax Division and U.S. Attorney Hayden O’Bryne of the Southern District of Florida made the announcement.

    IRS Criminal Investigation investigated the case.

    Trial Attorney Andrew Ascencio of the Tax Division and Assistant U.S. Attorney Michael Porter for the Southern District of Florida prosecuted the case.

    MIL Security OSI

  • MIL-OSI: BayFirst Financial Corp. Reports First Quarter 2025 Results

    Source: GlobeNewswire (MIL-OSI)

    ST. PETERSBURG, Fla., April 24, 2025 (GLOBE NEWSWIRE) — BayFirst Financial Corp. (NASDAQ: BAFN) (“BayFirst” or the “Company”), parent company of BayFirst National Bank (the “Bank”) today reported a net loss of $0.3 million, or $0.17 per common share and diluted common share, for the first quarter of 2025, a decrease of 103.4% compared to $9.8 million, or $2.27 per common share or $2.11 per diluted common share, in the fourth quarter of 2024.

    “While we were encouraged by net interest margin expansion and steady operating expenses during the quarter, our operating results were impacted by deteriorating economic conditions, resulting in net charge-offs and provision expense continuing to be elevated and lower valuations on our portfolio of loans measured at fair value,” stated Thomas G. Zernick, Chief Executive Officer. “Our business customers have been impacted by inflationary pressures, the continued high interest rate environment, recent macro economic changes and the resulting uncertainty. While we wait for clarity regarding the level and duration of the tariffs and begin to see the impact to the general economy from the recent policy changes, we will continue our practice of robust loan oversight and maintain close contact with our borrowers to better understand the longer-term implication to their businesses.”

    “Part of our strategic plan is to grow recurring revenue through net interest income, thereby resulting in less reliance on the gain on sale from government guaranteed loans,” Zernick continued. “A critical element of this strategy focuses on growing our low-cost deposit account base to fund our rapidly expanding conventional commercial and consumer loan portfolios. During the quarter, we did a good job of growing core deposit accounts while letting higher-cost time deposits run off. We serve individuals, families and small businesses, with a focus on checking and savings accounts which are not only less rate sensitive but also are far less volatile. Moreover, our focus on providing checking and savings accounts to a broad segment of the communities we serve expands our overall franchise in the attractive Tampa Bay region and increases opportunities for offering consumer loans, residential mortgages, and small business loans throughout our markets. As management works diligently to address credit concerns moving forward, we are exploring strategies to de-risk unguaranteed SBA loan balances on our balance sheet including portfolio sales and continuing to strengthen credit underwriting on SBA 7(a) loans.”

    “One of the highlights of the first quarter was strong loan growth within the community bank, supported by steady loan demand in the greater Tampa Bay market,” said Zernick. “Total loans held for investment increased nearly 2% during the first quarter and 16% over the past year. Community bank loans increased 4% during the current quarter, which included increases in CRE and consumer loans, while government guaranteed loan balances decreased 2% during the quarter. Despite a volatile national economic environment, our focus on local relationships and personalized banking solutions remains at the core of our success. We remain confident in our ability to return to profitability and drive long-term shareholder value while staying true to our mission of supporting the financial well-being of our local communities.”

    First Quarter 2025 Performance Review

    • Net interest margin was 3.77% in the first quarter of 2025, an increase of 17 basis points from 3.60% in the fourth quarter of 2024 and an increase of 35 basis points from 3.42% in the first quarter of 2024.
    • The Company’s government guaranteed loan team originated $106.3 million in new loans during the first quarter of 2025, a slight decrease from $107.8 million of loans produced in the previous quarter, and a decrease from $130.6 million of loans produced during the first quarter of 2024. Since the launch in 2022 of the Company’s Bolt loan program, an SBA 7(a) loan product designed to expeditiously provide working capital loans of $150 thousand or less, the Company has originated 6,207 Bolt loans totaling $802.0 million, of which 481 Bolt loans totaling $60.5 million were originated during the first quarter.
    • As we reported last quarter, the Company is pausing the practice of electing to measure SBA 7(a) loans at fair value and continued that in the first quarter, however one originated USDA guaranteed loan for $4.8 million was measured at fair value during the first quarter of 2025 versus no loans in the fourth quarter of 2024 and $37 million in the first quarter of 2024.
    • Loans held for investment increased by $18.3 million, or 1.7%, during the first quarter of 2025 to $1.08 billion and increased $149.9 million, or 16.0%, over the past year. During the quarter, the Company originated $157.5 million of loans and sold $72.5 million of government guaranteed loan balances.
    • Deposits decreased $15.0 million, or 1.3%, during the first quarter of 2025 and increased $121.0 million, or 12.0%, over the past year to $1.13 billion. A $19.5 million decrease in deposits during the quarter was in primarily high cost interest-bearing time deposits while noninterest-bearing checking accounts increased $4.5 million during the quarter.
    • Book value and tangible book value at March 31, 2025 were $22.77 per common share, a decrease from $22.95 at December 31, 2024.

    Results of Operations

    Net Income (Loss)

    The Company had a net loss of $0.3 million for the first quarter of 2025, compared to net income of $9.8 million in the fourth quarter of 2024 and $0.8 million in the first quarter of 2024. The change in the first quarter of 2025 from the preceding quarter was primarily the result of the pre-tax gain on sale of two branch office properties of $11.6 million in the fourth quarter of 2024, which was part of a sale-leaseback transaction. Also contributing to lower earnings was a decrease in gain on sale of government guaranteed loans of $1.1 million, a decrease in government guaranteed loan fair value gains of $0.7 million, and an increase in noninterest expense of $0.5 million, primarily higher occupancy and data processing costs, partially offset by an increase in net interest income of $0.3 million and a decrease in income tax expense on continuing operations of $3.4 million. The change from the first quarter of 2024 was due to a decrease in gain on sale of government guaranteed loans of $0.8 million, a decrease in government guaranteed loan fair value gains of $4.1 million, and a decrease in government guaranteed loan packaging fees of $0.7 million. This was partially offset by an increase in net interest income of $2.3 million and a decrease in noninterest expense of $2.0 million.

    Net Interest Income and Net Interest Margin

    Net interest income from continuing operations was $11.0 million in the first quarter of 2025, an increase from $10.7 million during the fourth quarter of 2024, and an increase from $8.7 million during the first quarter of 2024. The net interest margin was 3.77% in the first quarter of 2025, an increase of 17 basis points from 3.60% in the fourth quarter of 2024 and an increase of 35 basis points from 3.42% in the first quarter of 2024.

    The increase in net interest income from continuing operations during the first quarter of 2025, as compared to the fourth quarter of 2024, was mainly due to a decrease in interest cost on deposits of $1.2 million, partially offset by a decrease in loan interest income, including fees, of $1.0 million.

    The increase in net interest income from continuing operations during the first quarter of 2025, as compared to the year ago quarter, was mainly due to an increase in loan interest income, including fees, of $1.5 million and a decrease in interest expense on deposits of $0.8 million.

    Noninterest Income

    Noninterest income from continuing operations was $8.8 million for the first quarter of 2025, which was a decrease from $22.3 million in the fourth quarter of 2024 and a decrease from $14.3 million in the first quarter of 2024. This $5.5 million decrease is due to lower borrower demand combined with tighter credit guidelines deployed over the past year. The decrease in the first quarter of 2025, as compared to the fourth quarter of 2024, was primarily the result of the pre-tax gain on sale of two branch office properties of $11.6 million in the fourth quarter of 2024, which was part of a sale-leaseback transaction, and decreases in gain on sale of government guaranteed loans of $1.1 million and government guaranteed loan fair value gains of $0.7 million. The decrease in the first quarter of 2025, as compared to the first quarter of 2024, was the result of decreases in gain on sale of government guaranteed loans of $0.8 million, fair value gains on government guaranteed loans of $4.1 million, and government guaranteed loan packaging fees of $0.7 million.

    Noninterest Expense

    Noninterest expense from continuing operations was $15.8 million in the first quarter of 2025 compared to $15.3 million in the fourth quarter of 2024 and $17.8 million in the first quarter of 2024. The increase in the first quarter of 2025, as compared to the prior quarter, was primarily due to increases in occupancy expense of $0.4 million, data processing expense of $0.3 million, and loan origination and collection expenses of $0.3 million, partially offset by a decrease in compensation expense of $0.4 million. The decrease in the first quarter of 2025, as compared to the first quarter of 2024, was primarily due to lower compensation expense of $1.5 million, professional fees of $0.6 million, and loan origination and collection expenses of $0.7 million. This was partially offset by higher occupancy expense of $0.5 million and data processing expense of $0.5 million.

    Balance Sheet

    Assets

    Total assets increased $3.7 million, or 0.3%, during the first quarter of 2025 to $1.29 billion, mainly due to increases in loans held for investment of $18.3 million, partially offset by a decrease in cash and cash equivalents of $14.6 million. Compared to the end of the first quarter last year, total assets increased $147.8 million, or 12.9%, driven primarily by growth of loans held for investment of $149.9 million.

    Loans

    Loans held for investment increased $18.3 million, or 1.7%, during the first quarter of 2025 and $149.9 million, or 16.0%, over the past year to $1.08 billion, due to originations in both conventional community bank loans and government guaranteed loans, partially offset by government guaranteed loan sales.

    Deposits

    Deposits decreased $15.0 million, or 1.3%, during the first quarter of 2025 and increased $121.0 million, or 12.0%, from the first quarter of 2024, ending March 31, 2025 at $1.13 billion. During the first quarter, there were decreases in savings and money market deposit account balances of $6.7 million and time deposit balances of $17.1 million, partially offset by increases in noninterest-bearing deposit account balances of $4.5 million and interest-bearing transaction account balances of $4.3 million. The majority of the deposits are generated through the community bank in the Tampa Bay/Sarasota area. At March 31, 2025, approximately 81% of total deposits were insured by the FDIC. At times, the Bank has brokered time deposit and non-maturity deposit relationships available to diversify its funding sources. At March 31, 2025, December 31, 2024, and March 31, 2024, the Company had $112.3 million, $112.1 million, and $30.5 million, respectively, of brokered deposits.

    Asset Quality

    The Company recorded a provision for credit losses in the first quarter of $4.4 million, compared to provisions of $4.5 million for the fourth quarter of 2024 and $4.1 million during the first quarter of 2024.

    The ratio of ACL to total loans held for investment at amortized cost was 1.61% at March 31, 2025, 1.54% as of December 31, 2024, and 1.62% as of March 31, 2024. The ratio of ACL to total loans held for investment at amortized cost, excluding government guaranteed loan balances, was 1.84% at March 31, 2025, 1.79% as of December 31, 2024, and 1.88% as of March 31, 2024.

    Net charge-offs for the first quarter of 2025 were $3.3 million, which was a decrease from $3.4 million for the fourth quarter of 2024 and $3.7 million in the first quarter of 2024. Annualized net charge-offs as a percentage of average loans held for investment at amortized cost were 1.28% for the first quarter of 2025, compared to 1.34% in the fourth quarter of 2024 and 1.71% in the first quarter of 2024. Nonperforming assets were 2.08% of total assets as of March 31, 2025, compared to 1.50% as of December 31, 2024, and 0.97% as of March 31, 2024. Nonperforming assets, excluding government guaranteed loan balances, were 1.22% of total assets as of March 31, 2025, compared to 1.06% as of December 31, 2024, and 0.70% as of March 31, 2024. As we discussed in previous quarters, the Bank developed an express modification program for SBA 7(a) borrowers to help those borrowers who are challenged with larger payments in the higher interest rate environment compared to interest rates at the time the loans were originated.

    Capital

    The Bank’s Tier 1 leverage ratio was 8.56% as of March 31, 2025, compared to 8.82% as of December 31, 2024, and 9.12% as of March 31, 2024. The CET 1 and Tier 1 capital ratio to risk-weighted assets were 10.47% as of March 31, 2025, compared to 10.89% as of December 31, 2024, and 11.04% as of March 31, 2024. The total capital to risk-weighted assets ratio was 11.73% as of March 31, 2025, compared to 12.14% as of December 31, 2024, and 12.29% as of March 31, 2024.

    Liquidity

    The Bank’s overall liquidity position remains strong and stable with liquidity in excess of internal minimums as stated by policy and monitored by management and the Board. The on-balance sheet liquidity ratio at March 31, 2025 was 8.04%, as compared to 9.17% at December 31, 2024. The Bank has robust liquidity resources which include secured borrowings available from the Federal Home Loan Bank, the Federal Reserve, and lines of credit with other financial institutions. As of March 31, 2025, the Bank had $20.0 million of borrowings from the FHLB and no borrowings from the FRB or other financial institutions. This compared to no borrowings from FHLB, the FRB, or other financial institutions at December 31, 2024.

    Recent Events

    Share Repurchase Program. During the first quarter of 2025, the Company announced that its Board of Directors has adopted a share repurchase program. Under the repurchase program, the Company may repurchase up to $2.0 million of the Company’s outstanding shares, over a period beginning on January 28, 2025, and continuing until the earlier of the completion of the repurchase, or December 31, 2025, or termination of the program by the Board of Directors. To date, the Company has purchased $335 thousand of shares through this share repurchase program.

    Second Quarter Common Stock Dividend. On April 22, 2025, BayFirst’s Board of Directors declared a second quarter 2025 cash dividend of $0.08 per common share. The dividend will be payable June 15, 2025 to common shareholders of record as of June 1, 2025. The Company has continuously paid quarterly common stock cash dividends since 2016.

    Conference Call

    BayFirst’s management team will host a conference call on Friday, April 25, 2025, at 9:00 a.m. ET to discuss its first quarter results. Interested investors may listen to the call live under the Investor Relations tab at www.bayfirstfinancial.com. Investment professionals are invited to dial (800) 549-8228 to participate in the call using Conference ID 90275. A replay of the call will be available for one year at www.bayfirstfinancial.com.

    About BayFirst Financial Corp.

    BayFirst Financial Corp. is a registered bank holding company based in St. Petersburg, Florida which commenced operations on September 1, 2000. Its primary source of income is derived from its wholly owned subsidiary, BayFirst National Bank, a national banking association which commenced business operations on February 12, 1999. The Bank currently operates twelve full-service banking offices throughout the Tampa Bay-Sarasota region and offers a broad range of commercial and consumer banking services to businesses and individuals. It was named the best bank in Florida in 2024, according to Forbes and was the 10th largest SBA 7(a) lender by number of units originated and 19th largest by dollar volume nationwide through the SBA’s quarter ended March 31, 2025. As of March 31, 2025, BayFirst Financial Corp. had $1.29 billion in total assets.

    Forward-Looking Statements

    In addition to the historical information contained herein, this presentation includes “forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. These statements are subject to many risks and uncertainties, including, but not limited to, the effects of health crises, global military hostilities, weather events, or climate change, including their effects on the economic environment, our customers and our operations, as well as any changes to federal, state or local government laws, regulations or orders in connection with them; the ability of the Company to implement its strategy and expand its banking operations; changes in interest rates and other general economic, business and political conditions, including changes in the financial markets; changes in business plans as circumstances warrant; risks related to mergers and acquisitions; changes in benchmark interest rates used to price loans and deposits, changes in tax laws, regulations and guidance; and other risks detailed from time to time in filings made by the Company with the SEC, including, but not limited to those “Risk Factors” described in our most recent Form 10-K and Form 10-Q. Readers should note that the forward-looking statements included herein are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements.

       
    BAYFIRST FINANCIAL CORP.
    SELECTED FINANCIAL DATA (Unaudited)
       
      At or for the three months ended
    (Dollars in thousands, except for share data) 3/31/2025   12/31/2024   9/30/2024   6/30/2024   3/31/2024
    Net income (loss) $ (335 )   $ 9,776     $ 1,137     $ 866     $ 824  
    Balance sheet data:                  
    Average loans held for investment at amortized cost   1,027,648       1,003,867       948,528       902,417       855,040  
    Average total assets   1,287,618       1,273,296       1,228,040       1,178,501       1,126,315  
    Average common shareholders’ equity   96,053       87,961       86,381       84,948       85,385  
    Total loans held for investment   1,084,817       1,066,559       1,042,445       1,008,314       934,868  
    Total loans held for investment, excl gov’t gtd loan balances   943,979       917,075       885,444       844,659       776,302  
    Allowance for credit losses   16,513       15,512       14,186       13,843       13,906  
    Total assets   1,291,957       1,288,297       1,245,099       1,217,869       1,144,194  
    Total deposits   1,128,267       1,143,229       1,112,196       1,042,388       1,007,315  
    Common shareholders’ equity   94,034       94,869       86,242       84,911       84,578  
    Share data:                  
    Basic earnings (loss) per common share $ (0.17 )   $ 2.27     $ 0.18     $ 0.12     $ 0.11  
    Diluted earnings (loss) per common share   (0.17 )     2.11       0.18       0.12       0.11  
    Dividends per common share   0.08       0.08       0.08       0.08       0.08  
    Book value per common share   22.77       22.95       20.86       20.54       20.45  
    Tangible book value per common share (1)   22.77       22.95       20.86       20.54       20.45  
    Performance and capital ratios:                  
    Return on average assets(2) (0.10 )%     3.07 %     0.37 %     0.29 %     0.29 %
    Return on average common equity(2) (3.00 )%     42.71 %     3.48 %     2.26 %     2.06 %
    Net interest margin(2)   3.77 %     3.60 %     3.34 %     3.43 %     3.42 %
    Dividend payout ratio (46.01 )%     3.52 %     43.98 %     68.91 %     75.27 %
    Asset quality ratios:                  
    Net charge-offs $ 3,301     $ 3,369     $ 2,757     $ 3,261     $ 3,652  
    Net charge-offs/avg loans held for investment at amortized cost(2)   1.28 %     1.34 %     1.16 %     1.45 %     1.71 %
    Nonperforming loans(3) $ 24,806     $ 17,607     $ 15,489     $ 12,312     $ 9,877  
    Nonperforming loans (excluding gov’t gtd balance)(3) $ 15,078     $ 13,570     $ 10,992     $ 8,054     $ 7,568  
    Nonperforming loans/total loans held for investment(3)   2.42 %     1.75 %     1.62 %     1.34 %     1.15 %
    Nonperforming loans (excl gov’t gtd balance)/total loans held for investment(3)   1.47 %     1.35 %     1.15 %     0.87 %     0.88 %
    ACL/Total loans held for investment at amortized cost   1.61 %     1.54 %     1.48 %     1.50 %     1.62 %
    ACL/Total loans held for investment at amortized cost, excl government guaranteed loans   1.84 %     1.79 %     1.70 %     1.73 %     1.88 %
    Other Data:                  
    Full-time equivalent employees   305       299       295       302       313  
    Banking center offices   12       12       12       12       12  
    (1) See section entitled “GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures” below for a reconciliation to most comparable GAAP equivalent.
    (2) Annualized
    (3) Excludes loans measured at fair value
                       

    Reconciliation and Management Explanation of Non-GAAP Financial Measures

    Some of the financial measures included in this report are not measures of financial condition or performance recognized by GAAP. These non-GAAP financial measures include tangible common shareholders’ equity and tangible book value per common share. Our management uses these non-GAAP financial measures in its analysis of our performance, and we believe that providing this information to financial analysts and investors allows them to evaluate capital adequacy.

    The following presents the calculation of the non-GAAP financial measures.

     
    Tangible Common Shareholders’ Equity and Tangible Book Value Per Common Share (Unaudited)
      As of
    (Dollars in thousands, except for share data) March 31, 2025   December 31, 2024   September 30, 2024   June 30, 2024   March 31, 2024
    Total shareholders’ equity $ 110,085     $ 110,920     $ 102,293     $ 100,962     $ 100,629  
    Less: Preferred stock liquidation preference   (16,051 )     (16,051 )     (16,051 )     (16,051 )     (16,051 )
    Total equity available to common shareholders   94,034       94,869       86,242       84,911       84,578  
    Less: Goodwill                            
    Tangible common shareholders’ equity $ 94,034     $ 94,869     $ 86,242     $ 84,911     $ 84,578  
                       
    Common shares outstanding   4,129,027       4,132,986       4,134,059       4,134,219       4,134,914  
    Tangible book value per common share $ 22.77     $ 22.95     $ 20.86     $ 20.54     $ 20.45  
                                           
    BAYFIRST FINANCIAL CORP.
    CONSOLIDATED BALANCE SHEETS
    (Dollars in thousands) 3/31/2025
      12/31/2024
      3/31/2024
    Assets (Unaudited)       (Unaudited)
    Cash and due from banks $ 6,517     $ 4,499     $ 4,425  
    Interest-bearing deposits in banks   56,637       73,289       53,080  
    Cash and cash equivalents   63,154       77,788       57,505  
    Time deposits in banks   2,025       2,270       3,000  
    Investment securities available for sale, at fair value (amortized cost $39,507, $40,279, and $46,816 at March 31, 2025, December 31, 2024, and March 31, 2024, respectively)   36,318       36,291       42,514  
    Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $12, $12, and $14 (fair value: $2,356, $2,346, and $2,352 at March 31, 2025, December 31, 2024, and March 31, 2024, respectively)   2,488       2,488       2,487  
    Nonmarketable equity securities   5,480       4,526       5,228  
    Government guaranteed loans held for sale               2,226  
    Government guaranteed loans held for investment, at fair value   57,901       60,833       77,769  
    Loans held for investment, at amortized cost   1,026,916       1,005,726       857,099  
    Allowance for credit losses on loans   (16,513 )     (15,512 )     (13,906 )
    Net Loans held for investment, at amortized cost   1,010,403       990,214       843,193  
    Accrued interest receivable   9,153       9,155       7,625  
    Premises and equipment, net   32,769       33,249       39,327  
    Loan servicing rights   16,460       16,534       15,742  
    Right-of-use operating lease assets   15,484       15,814       2,499  
    Bank owned life insurance   26,696       26,513       25,974  
    Other real estate owned   132       132       404  
    Other assets   13,494       12,490       18,401  
    Assets from discontinued operations               300  
    Total assets $ 1,291,957     $ 1,288,297     $ 1,144,194  
    Liabilities:      
    Noninterest-bearing deposit accounts $ 106,236     $ 101,743     $ 96,977  
    Interest-bearing transaction accounts   261,074       256,793       250,478  
    Savings and money market deposit accounts   467,766       474,425       391,915  
    Time deposits   293,191       310,268       267,945  
    Total deposits   1,128,267       1,143,229       1,007,315  
    FHLB borrowings   20,000             15,000  
    Subordinated debentures   5,957       5,956       5,950  
    Notes payable   1,820       1,934       2,276  
    Accrued interest payable   1,053       1,036       1,598  
    Operating lease liabilities   14,102       14,510       2,673  
    Deferred income tax liabilities   648       301       728  
    Accrued expenses and other liabilities   10,025       10,411       7,496  
    Liabilities from discontinued operations               529  
    Total liabilities   1,181,872       1,177,377       1,043,565  
    Shareholders’ equity: (Unaudited)       (Unaudited)
    Preferred stock, Series A; no par value, 10,000 shares authorized, 6,395 shares issued and outstanding at March 31, 2025, December 31, 2024, and March 31, 2024; aggregate liquidation preference of $6,395 each period   6,161       6,161       6,161  
    Preferred stock, Series B; no par value, 20,000 shares authorized, 3,210 shares issued and outstanding at March 31, 2025, December 31, 2024, and March 31, 2024; aggregate liquidation preference of $3,210 each period   3,123       3,123       3,123  
    Preferred stock, Series C; no par value, 10,000 shares authorized, 6,446 shares issued and outstanding at March 31, 2025, December 31, 2024, and March 31, 2024; aggregate liquidation preference of $6,446 at March 31, 2025, December 31, 2024, and March 31, 2024   6,446       6,446       6,446  
    Common stock and additional paid-in capital; no par value, 15,000,000 shares authorized, 4,129,027, 4,132,986, and 4,134,914 shares issued and outstanding at March 31, 2025, December 31, 2024, and March 31, 2024, respectively   54,657       54,764       54,776  
    Accumulated other comprehensive loss, net   (2,378 )     (2,956 )     (3,188 )
    Unearned compensation   (1,006 )     (752 )     (1,192 )
    Retained earnings   43,082       44,134       34,503  
    Total shareholders’ equity   110,085       110,920       100,629  
    Total liabilities and shareholders’ equity $ 1,291,957     $ 1,288,297     $ 1,144,194  
                           
    BAYFIRST FINANCIAL CORP.
    CONSOLIDATED STATEMENTS OF INCOME
      For the Quarter Ended
    (Dollars in thousands, except per share data) 3/31/2025   12/31/2024   3/31/2024
    Interest income: (Unaudited)   (Unaudited)   (Unaudited)
    Loans, including fees $ 19,751     $ 20,747     $ 18,228  
    Interest-bearing deposits in banks and other   934       1,007       959  
    Total interest income   20,685       21,754       19,187  
    Interest expense:          
    Deposits   9,431       10,600       10,215  
    Other   255       501       230  
    Total interest expense   9,686       11,101       10,445  
    Net interest income   10,999       10,653       8,742  
    Provision for credit losses   4,400       4,546       4,058  
    Net interest income after provision for credit losses   6,599       6,107       4,684  
    Noninterest income:          
    Loan servicing income, net   736       582       795  
    Gain on sale of government guaranteed loans, net   7,327       8,425       8,089  
    Service charges and fees   449       451       444  
    Government guaranteed loans fair value gain (loss), net   (755 )     (80 )     3,305  
    Government guaranteed loan packaging fees   716       773       1,407  
    Gain on sale of premises and equipment         11,649        
    Other noninterest income   278       476       228  
    Total noninterest income   8,751       22,276       14,268  
    Noninterest Expense:          
    Salaries and benefits   7,998       7,351       8,005  
    Bonus, commissions, and incentives   71       1,074       1,571  
    Occupancy and equipment   1,634       1,217       1,110  
    Data processing   2,045       1,749       1,560  
    Marketing and business development   487       390       588  
    Professional services   732       803       1,349  
    Loan origination and collection   1,035       758       1,719  
    Employee recruiting and development   617       445       597  
    Regulatory assessments   339       379       282  
    Other noninterest expense   855       1,169       992  
    Total noninterest expense   15,813       15,335       17,773  
    Income (loss) before taxes from continuing operations   (463 )     13,048       1,179  
    Income tax expense (benefit) from continuing operations   (128 )     3,272       296  
    Net income (loss) from continuing operations   (335 )     9,776       883  
    Loss from discontinued operations before income taxes               (78 )
    Income tax benefit from discontinued operations               (19 )
    Net loss from discontinued operations               (59 )
               
    Net income (loss)   (335 )     9,776       824  
    Preferred dividends   385       385       385  
    Net income available to (loss attributable to) common shareholders $ (720 )   $ 9,391     $ 439  
    Basic earnings (loss) per common share: (Unaudited)   (Unaudited)   (Unaudited)
    Continuing operations $ (0.17 )   $ 2.27     $ 0.12  
    Discontinued operations               (0.01 )
    Basic earnings (loss) per common share $ (0.17 )   $ 2.27     $ 0.11  
               
    Diluted earnings (loss) per common share:          
    Continuing operations $ (0.17 )   $ 2.11     $ 0.12  
    Discontinued operations               (0.01 )
    Diluted earnings (loss) per common share $ (0.17 )   $ 2.11     $ 0.11  
                           

    Loan Composition

    (Dollars in thousands) 3/31/2025   12/31/2024   9/30/2024   6/30/2024   3/31/2024
      (Unaudited)       (Unaudited)   (Unaudited)   (Unaudited)
    Real estate:                  
    Residential $ 339,886     $ 330,870     $ 321,740     $ 304,234     $ 285,214  
    Commercial   296,351       305,721       292,026       288,185       273,227  
    Construction and land   46,740       32,914       33,784       35,759       36,764  
    Commercial and industrial   234,384       226,522       200,212       192,140       182,264  
    Commercial and industrial – PPP   457       941       1,656       2,324       2,965  
    Consumer and other   93,889       93,826       92,546       85,789       63,854  
    Loans held for investment, at amortized cost, gross   1,011,707       990,794       941,964       908,431       844,288  
    Deferred loan costs, net   20,521       19,499       18,060       17,299       16,233  
    Discount on government guaranteed loans   (8,727 )     (8,306 )     (7,880 )     (7,731 )     (7,674 )
    Premium on loans purchased, net   3,415       3,739       3,860       4,173       4,252  
    Loans held for investment, at amortized cost, net   1,026,916       1,005,726       956,004       922,172       857,099  
    Government guaranteed loans held for investment, at fair value   57,901       60,833       86,441       86,142       77,769  
    Total loans held for investment, net $ 1,084,817     $ 1,066,559     $ 1,042,445     $ 1,008,314     $ 934,868  
                                           

    Nonperforming Assets (Unaudited)

    (Dollars in thousands) 3/31/2025   12/31/2024   9/30/2024   6/30/2024   3/31/2024
    Nonperforming loans (government guaranteed balances), at amortized cost, gross $ 9,728     $ 4,037     $ 4,497     $ 4,258     $ 2,309  
    Nonperforming loans (unguaranteed balances), at amortized cost, gross   15,078       13,570       10,992       8,054       7,568  
    Total nonperforming loans, at amortized cost, gross   24,806       17,607       15,489       12,312       9,877  
    Nonperforming loans (government guaranteed balances), at fair value   507             24       341       94  
    Nonperforming loans (unguaranteed balances), at fair value   1,419       1,490       1,535       1,284       729  
    Total nonperforming loans, at fair value   1,926       1,490       1,559       1,625       823  
    OREO   132       132             1,633       404  
    Repossessed assets   36       36       94              
    Total nonperforming assets, gross $ 26,900     $ 19,265     $ 17,142     $ 15,570     $ 11,104  
    Nonperforming loans as a percentage of total loans held for investment(1)   2.42 %     1.75 %     1.62 %     1.34 %     1.15 %
    Nonperforming loans (excluding government guaranteed balances) to total loans held for investment(1)   1.47 %     1.35 %     1.15 %     0.87 %     0.88 %
    Nonperforming assets as a percentage of total assets   2.08 %     1.50 %     1.38 %     1.28 %     0.97 %
    Nonperforming assets (excluding government guaranteed balances) to total assets   1.22 %     1.06 %     0.88 %     0.82 %     0.70 %
    ACL to nonperforming loans(1)   66.57 %     88.10 %     91.59 %     112.44 %     140.79 %
    ACL to nonperforming loans (excluding government guaranteed balances)(1)   109.52 %     114.31 %     129.06 %     171.88 %     183.75 %
    (1) Excludes loans measured at fair value
    Contacts:  
    Thomas G. Zernick Scott J. McKim
    Chief Executive Officer Chief Financial Officer
    727.399.5680 727.521.7085

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