Core Viewpoint - Rosen Law Firm is investigating potential securities claims on behalf of shareholders of Eagle Bancorp, Inc. due to allegations of materially misleading business information issued by the company [1]. Group 1: Investigation and Class Action - Shareholders of Eagle Bancorp may be entitled to compensation through a class action lawsuit without any out-of-pocket fees, as the Rosen Law Firm prepares to seek recovery of investor losses [2]. - Investors can join the prospective class action by submitting a form or contacting the law firm directly for more information [2]. Group 2: Financial Performance and Market Reaction - Eagle Bancorp's Q1 2025 results, announced on April 23, 2025, showed a significant miss on both earnings per share (EPS) and revenue compared to forecasts, leading to an 11.3% drop in stock price on April 24, 2025 [3]. Group 3: Rosen Law Firm's Credentials - The Rosen Law Firm has a strong track record in securities class actions, having achieved the largest securities class action settlement against a Chinese company at the time and being ranked No. 1 for the number of settlements in 2017 [4]. - The firm has recovered hundreds of millions of dollars for investors, securing over $438 million in 2019 alone, and has consistently been recognized for its success in this field [4].

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) Provides a comprehensive overview of the company's financial performance and position for the first quarter of 2025, including detailed financial statements and management's analysis [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) For Q1 2025, Eagle Bancorp reported a net income of $1.7 million, a significant improvement from a net loss of $0.3 million in the prior-year period, with total assets increasing to $11.3 billion and deposits growing to $9.3 billion Consolidated Balance Sheet Highlights (Unaudited) | (in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $11,317,361 | $11,129,508 | | Loans held for investment, net | $7,813,837 | $7,820,498 | | Total Deposits | $9,277,268 | $9,131,078 | | Total Liabilities | $10,072,470 | $9,903,447 | | Total Shareholders' Equity | $1,244,891 | $1,226,061 | Consolidated Statement of Operations Highlights (Unaudited) | (in thousands, except per share data) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net Interest Income | $65,649 | $74,698 | | Provision for Credit Losses | $26,255 | $35,175 | | Noninterest Income | $8,207 | $3,589 | | Noninterest Expense | $45,451 | $39,997 | | Net Income (Loss) | $1,675 | $(338) | | Diluted Earnings (Loss) Per Share | $0.06 | $(0.01) | [Note 1 – Summary of Significant Accounting Policies](index=8&type=section&id=Note%201%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) The company's accounting policies conform to GAAP, with the Allowance for Credit Losses (ACL) estimated using a CECL model incorporating an 18-month forecast and four economic variables across three scenarios - The company's CECL model for estimating the Allowance for Credit Losses (ACL) uses a forecast period of **18 months**[49](index=49&type=chunk) - The cash flow model incorporates four economic variables: national unemployment, Commercial Real Estate (CRE) Price Index, House Price Index, and Gross Domestic Product (GDP), using a weighted approach of three economic scenarios (baseline, upside, downside)[49](index=49&type=chunk) [Note 3 – Investment Securities](index=14&type=section&id=Note%203%20%E2%80%93%20Investment%20Securities) As of March 31, 2025, the investment portfolio comprised $1.21 billion in AFS and $924.5 million in HTM securities, holding significant unrealized losses primarily due to market interest rate changes Investment Securities Summary (March 31, 2025) | Security Category | Amortized Cost (in thousands) | Estimated Fair Value (in thousands) | | :--- | :--- | :--- | | **Available-for-Sale (AFS)** | $1,330,077 | $1,214,237 | | **Held-to-Maturity (HTM), net** | $924,473 | $820,530 | - As of March 31, 2025, the AFS portfolio had gross unrealized losses of **$115.9 million**, and the HTM portfolio had gross unrecognized losses of **$105.2 million**[73](index=73&type=chunk)[77](index=77&type=chunk) - The allowance for credit losses on AFS securities was **zero**, while the allowance for HTM securities was **$1.28 million** as of March 31, 2025[79](index=79&type=chunk) [Note 4 – Loans and Allowance for Credit Losses](index=18&type=section&id=Note%204%20%E2%80%93%20Loans%20and%20Allowance%20for%20Credit%20Losses) The total loan portfolio was $7.94 billion as of March 31, 2025, with a significant concentration in commercial real estate, and the ACL increased to $129.5 million driven by provisions and net charge-offs Loan Portfolio Composition | Loan Category | March 31, 2025 (in thousands) | % of Total | | :--- | :--- | :--- | | Income producing - commercial real estate | $3,967,124 | 49% | | Owner occupied - commercial real estate | $1,403,668 | 18% | | Construction - commercial and residential | $1,210,788 | 15% | | Commercial | $1,178,343 | 15% | | Other | $183,083 | 3% | | **Total Loans** | **$7,943,306** | **100%** | Allowance for Credit Losses (ACL) Activity - Q1 2025 | (in thousands) | Amount | | :--- | :--- | | Balance at beginning of year | $114,390 | | Net loans charged-off | $(11,230) | | Provision for credit losses | $26,309 | | **Ending balance** | **$129,469** | - Nonaccrual loans totaled **$200.4 million** as of March 31, 2025, down from **$208.7 million** as of December 31, 2024[108](index=108&type=chunk) - During Q1 2025, the company modified loans for borrowers experiencing financial difficulty with an amortized cost basis of **$83.0 million**[114](index=114&type=chunk) [Note 7 – Deposits](index=30&type=section&id=Note%207%20%E2%80%93%20Deposits) Total deposits increased to $9.28 billion as of March 31, 2025, driven by time deposit growth, with brokered deposits remaining a significant funding source at 41% of the total Deposit Composition | (in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Noninterest-bearing demand | $1,607,826 | $1,544,403 | | Interest-bearing transaction | $926,722 | $1,211,791 | | Savings and money market | $3,558,919 | $3,599,221 | | Time deposits | $3,183,801 | $2,775,663 | | **Total Deposits** | **$9,277,268** | **$9,131,078** | - As of March 31, 2025, total brokered deposits were **$3.8 billion**, representing **41%** of total deposits[139](index=139&type=chunk) [Note 8 – Borrowings](index=32&type=section&id=Note%208%20%E2%80%93%20Borrowings) Total borrowings were approximately $598.5 million as of March 31, 2025, primarily FHLB advances and senior notes, while the company maintained significant available liquidity of approximately $4.2 billion Borrowings Summary (March 31, 2025) | Borrowing Source | Net Outstanding (in thousands) | Available Capacity (in thousands) | | :--- | :--- | :--- | | FHLB | $490,000 | $1,070,435 | | FRB Discount Window | $0 | $1,806,205 | | Senior notes | $76,181 | $0 | | **Total** | **$566,181** | **$2,876,640** | - The Company has total additional undrawn borrowing capacity of approximately **$4.2 billion**, which includes unencumbered securities available to be pledged[141](index=141&type=chunk) [Note 13 - Legal Contingencies](index=40&type=section&id=Note%2013%20-%20Legal%20Contingencies) The company is cooperating with an ongoing U.S. Attorney's Office investigation concerning anti-money laundering controls from 2011-2017 and cannot estimate potential losses - The Company is under an ongoing investigation by the U.S. Attorney's Office regarding its anti-money laundering controls from approximately **2011 to 2017**[172](index=172&type=chunk) - Due to the inherent uncertainty, the Company cannot estimate the potential losses, if any, resulting from this investigation[172](index=172&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=41&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A attributes Q1 2025 net income to lower credit loss provisions and higher noninterest income, offsetting declining net interest income and increased expenses, while maintaining strong capital and liquidity [Results of Operations](index=44&type=section&id=Results%20of%20Operations) Net income for Q1 2025 improved to $1.7 million due to decreased provision for credit losses and increased noninterest income, despite a decline in net interest income and higher noninterest expenses - Net interest income decreased by **12%** to **$65.6 million** in Q1 2025 from **$74.7 million** in Q1 2024, primarily due to lower yields on loans and higher average deposit balances with lower rates[194](index=194&type=chunk)[203](index=203&type=chunk) - The provision for credit losses was **$26.3 million** in Q1 2025, a decrease from **$35.2 million** in Q1 2024[196](index=196&type=chunk) - Noninterest income increased **129%** to **$8.2 million**, primarily driven by a **$3.6 million** increase in income from bank-owned life insurance (BOLI) following a new **$200 million** investment[195](index=195&type=chunk)[220](index=220&type=chunk) - Noninterest expense rose **14%** to **$45.5 million**, largely due to a **$2.5 million (40%)** increase in FDIC insurance expense[197](index=197&type=chunk)[221](index=221&type=chunk) [Balance Sheet Analysis](index=49&type=section&id=Balance%20Sheet%20Analysis) Total assets grew 2% to $11.3 billion, primarily from a BOLI investment, with the loan portfolio stable at $7.94 billion, heavily concentrated in commercial real estate, and deposits increasing to $9.3 billion - Total assets increased by **2%** to **$11.3 billion**, primarily driven by the purchase of additional BOLI coverage[228](index=228&type=chunk) - The loan portfolio has a high concentration in real estate, with commercial real estate and construction loans making up **83%** of the portfolio as of March 31, 2025[238](index=238&type=chunk) - Income producing CRE loans collateralized by office properties comprised **$847.7 million**, or **10.7%** of total loans, as of March 31, 2025[242](index=242&type=chunk) - Total deposits increased **2%** to **$9.3 billion**, driven by a **$408.1 million** increase in time deposits[231](index=231&type=chunk)[278](index=278&type=chunk) [Allowance for Credit Losses](index=53&type=section&id=Allowance%20for%20Credit%20Losses) The ACL on loans increased to $129.5 million, or 1.63% of total loans, driven by a $26.3 million provision and $11.2 million in net charge-offs, improving the ACL to nonperforming loans ratio to 65% ACL Ratios | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | ACL for loans (in millions) | $129.5 | $114.4 | | ACL as % of total loans | 1.63% | 1.44% | | ACL as % of nonperforming loans | 65% | 55% | - Net charge-offs for Q1 2025 were **$11.2 million**, which included **$11.0 million** from three CRE office lending relationships[253](index=253&type=chunk) - The ACL attributable to performing office properties as a percentage of total loans increased to **5.78%** from **3.81%** at year-end, indicating increased reserves for this segment[257](index=257&type=chunk) [Nonperforming Assets](index=54&type=section&id=Nonperforming%20Assets) Total nonperforming assets decreased to $202.9 million, or 1.79% of total assets, primarily due to a reduction in nonperforming loans from charge-offs on CRE loans Nonperforming Assets Summary | (in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Nonperforming loans | $200,441 | $208,706 | | Other real estate owned (OREO) | $2,459 | $2,743 | | **Total nonperforming assets** | **$202,900** | **$211,449** | | Ratio of NPLs to total loans | 2.52% | 2.63% | | Ratio of NPAs to total assets | 1.79% | 1.90% | - The decrease in nonperforming loans was primarily due to charge-offs on CRE loans during the quarter[262](index=262&type=chunk) [Liquidity Management](index=58&type=section&id=LIQUIDITY%20MANAGEMENT) The company maintains a strong liquidity position with $5.6 billion in available secondary liquidity and $4.2 billion in total aggregate borrowing capacity, deemed adequate for funding needs Secondary Sources of Liquidity (March 31, 2025) | Source | In Use (in thousands) | Available (in thousands) | | :--- | :--- | :--- | | Unsecured brokered deposits | $1,077,776 | $1,266,390 | | FHLB secured borrowings | $490,000 | $1,070,435 | | FRB Discount window | $0 | $1,806,205 | | Unpledged assets (for collateral) | $0 | $1,292,908 | | **Total (selected)** | **$1,567,776** | **$5,435,938** | - Total aggregate borrowing capacity as of March 31, 2025 was **$4.2 billion**[301](index=301&type=chunk) [Capital Resources and Adequacy](index=60&type=section&id=CAPITAL%20RESOURCES%20AND%20ADEQUACY) The company's capital levels significantly exceed regulatory requirements, with a CET1 ratio of 14.61% and a total risk-based capital ratio of 15.86%, despite a concentration in construction and development loans Company Capital Ratios (March 31, 2025) | Ratio | Actual | Minimum Required (w/ buffer) | | :--- | :--- | :--- | | CET1 capital ratio | 14.61% | 7.00% | | Tier 1 capital ratio | 14.61% | 8.50% | | Total risk-based capital ratio | 15.86% | 10.50% | | Tier 1 leverage ratio | 11.11% | 4.00% | - The company's construction, land, and land development loans represent **119.61%** of consolidated risk-based capital, exceeding the **100%** regulatory guidance threshold for potential concentration risk[309](index=309&type=chunk) - A regular quarterly cash dividend of **$0.165 per share** was announced on April 23, 2025[316](index=316&type=chunk) [Asset/Liability Management](index=62&type=section&id=Asset%2FLiability%20Management) The company actively manages interest rate risk, positioned as asset-sensitive, with a +100 basis point rate shock modeled to increase net interest income by 0.8% over 12 months Interest Rate Shock Analysis on Net Interest Income (12-Month) | Change in Rates (bps) | % Change in NII | | :--- | :--- | | +400 | 3.4% | | +200 | 1.7% | | +100 | 0.8% | | -100 | (0.7)% | | -200 | (1.4)% | - The re-pricing duration of the loan portfolio was **10 months** as of March 31, 2025, with **62.8%** of loans having variable or adjustable rates[323](index=323&type=chunk) - The duration of the investment portfolio decreased to **4.1 years** from **4.2 years** at year-end 2024[325](index=325&type=chunk) [Controls and Procedures](index=66&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during Q1 2025 - Management concluded that disclosure controls and procedures were effective as of March 31, 2025[350](index=350&type=chunk) - No material changes to internal control over financial reporting occurred in Q1 2025[351](index=351&type=chunk) [PART II. OTHER INFORMATION](index=67&type=section&id=PART%20II.%20OTHER%20INFORMATION) Presents additional disclosures, including specific risk factors related to the company's geographic concentration and potential impacts from economic and policy changes [Risk Factors](index=67&type=section&id=Item%201A.%20Risk%20Factors) The company highlights risks from its concentration in the Washington, D.C. metropolitan area, including potential adverse impacts from federal government spending changes, and notes risks from U.S. trade policy shifts - A key risk is the potential adverse impact from changes in federal government spending or workforce size in the Washington, D.C. area, which could harm the local economy and the commercial real estate market[355](index=355&type=chunk)[356](index=356&type=chunk) - The company notes that a decline in federal government spending or a shutdown could have a ripple effect, adversely affecting asset quality, capital, and liquidity[357](index=357&type=chunk) - Changes in U.S. trade policies and practices, such as new tariffs, are identified as a risk that could disrupt the economy and adversely affect the company's business and financial results[359](index=359&type=chunk)[361](index=361&type=chunk)

Core Insights - Eagle Bancorp, Inc. is under investigation for potential violations of federal securities laws and unlawful business practices [1] - In Q1 2025, Eagle reported a significant decline in net income to $1.7 million, down from $15.3 million in the previous quarter, primarily due to increased provision expenses and decreased net interest income [2] - Following the financial results announcement, Eagle's stock price dropped by 11.37%, closing at $18.78 per share [2] Financial Performance - Q1 2025 net income: $1.7 million ($0.06 per diluted share) compared to $15.3 million ($0.50 per diluted share) in Q4 2024 [2] - The decrease in net income was attributed to a $14.1 million increase in provision expense, a $5.1 million decline in net interest income, and a $0.9 million rise in noninterest expenses [2] - Valuation risk in the office portfolio was highlighted as a primary concern driving the provision for credit losses [2] Legal Investigation - Bragar Eagel & Squire, P.C. is investigating claims on behalf of Eagle stockholders regarding potential legal violations [1] - The law firm encourages affected stockholders to reach out for more information or to participate in the investigation [3]

NEW YORK, May 01, 2025 (GLOBE NEWSWIRE) -- The law firm of Kirby McInerney LLP is investigating potential claims against Eagle Bancorp, Inc. (“Eagle” or the “Company”) (NASDAQ:EGBN). The investigation concerns whether Eagle and/or certain of its officers have violated the federal securities laws and/or engaged in other unlawful business practices. [LEARN MORE ABOUT THE INVESTIGATION] On April 23, 2025, Eagle issued a press release reporting its financial results for the first quarter of 2025. Among other i ...

Financial Data and Key Metrics Changes - The company reported net income of $1.7 million for the quarter, a significant decline from $15.3 million in the prior quarter, resulting in earnings per diluted share of $0.06 compared to $0.50 previously [7][29] - The pretax income decreased by $17.3 million to $2.4 million in the first quarter, driven by a higher provision for credit losses, a decline in net interest income, and increased noninterest expenses [29][30] - The allowance for credit losses increased to $129.5 million, representing coverage of total loans at 1.63%, up 19 basis points from the prior quarter [21][31] Business Line Data and Key Metrics Changes - Commercial lending grew by $109.1 million or 4.3% from December 31, 2024, reflecting the impact of new additions to the Commercial & Industrial (C&I) team [11] - Deposits increased by $146.2 million in the first quarter, primarily through time deposits in digital and branch channels, enhancing the bank's liquidity [12][32] - Noninterest income rose to $8.2 million for the first quarter, compared to $4.1 million in the prior quarter, largely due to a $200 million separate account BOLI transaction [36] Market Data and Key Metrics Changes - The company noted modest exposure to government contracting and GSA-linked assets, which reduces sensitivity to changes in federal budget spending [13] - The DC economy is diversified beyond the federal government, including educational institutions, a growing technology sector, and tourism, supporting long-term stability [14] Company Strategy and Development Direction - The company is focused on preserving capital flexibility, improving portfolio quality, and managing through volatility while maintaining long-term franchise value [17][28] - There is an emphasis on exploring asset disposition strategies for office loans to address evolving valuation risks [15][16] - The company aims to deepen relationship-based deposits and drive operational excellence despite challenges in asset quality and valuation pressures [41][42] Management's Comments on Operating Environment and Future Outlook - Management acknowledged sustained pressure on office property valuations and the need for adequate reserves to absorb potential losses [15][17] - The outlook for net interest margin (NIM) is being adjusted downward due to higher funding costs, but there is optimism for improvement as funding costs decrease [35][60] - The company remains confident in its ability to execute strategic priorities and maintain a resilient capital base [18][40] Other Important Information - The company reported a tangible common equity ratio of 11% at quarter-end, with 75% of total deposits insured, reflecting a stable funding base [31][32] - The average deposits grew by $381.6 million from a year ago during the first quarter of 2024 [32] Q&A Session Summary Question: Insights on Office Portfolio Reserve Drivers - Management explained that the reserve build was driven by updated assumptions regarding probability of default and loss given default based on recent appraisals, leading to a $14.3 million increase in the allowance for credit losses related to the office portfolio [46][48] Question: Impact of Government Contracting on Credit - Management noted that the government contracting portfolio is modest, with ongoing communication with clients to assess potential impacts from federal budget changes [55][56] Question: NIM Expansion Assumptions - Management indicated that the forecast for NIM does not include Fed rate cuts and is driven by a new pricing structure for third-party payment processing and redeployment of funds into higher-earning assets [57][60] Question: Office Portfolio Appraisal Updates - Management confirmed that appraisals for the office portfolio are conducted proactively, with updates provided as necessary [100][102] Question: Growth in C&I Portfolio - Management expressed optimism about the growth in the C&I pipeline, attributing it to new team members and increased activity [104][105]

Financial Data and Key Metrics Changes - The company reported net income of $1,700,000 for the quarter, reflecting continued earnings pressure compared to $15,300,000 in the prior quarter [5][18] - Pre-tax income declined by $17,300,000 to $2,400,000 in the first quarter, driven by a higher provision for credit losses, a decline in net interest income, and increased non-interest expenses [18] - The allowance for credit losses increased to $129,500,000, representing coverage of total loans at 1.63%, up 19 basis points from the prior quarter [13][19] - Net interest income before provision totaled $65,600,000, decreasing from $70,800,000 in the prior quarter due to lower average interest-bearing cash balances and lower rates on loans [21] - The tangible common equity ratio decreased by two basis points to 11% at quarter end, while book value per share increased by $0.39 to $40.99 [20] Business Line Data and Key Metrics Changes - The commercial lending platform saw loans grow by $109,100,000 or 4.3% over the previous quarter [7] - Deposits grew by $146,200,000, largely through time deposits in digital and branch channels, enhancing the bank's liquidity strength [8] - Non-interest income increased to $8,200,000 for the first quarter, compared to $4,100,000 in the prior quarter, primarily driven by a separate account BOLI transaction [24] Market Data and Key Metrics Changes - The DC economy is diversified beyond the federal government, including educational institutions, a growing technology sector, and tourism, which supports long-term stability [9] - The company has modest exposure to government contracting and GSA-linked assets, reducing sensitivity to changes in federal budget spending [8] Company Strategy and Development Direction - The company is focused on preserving capital flexibility, improving portfolio quality, and managing through volatility while maintaining long-term franchise value [11][27] - There is an emphasis on executing a disciplined strategy to enhance franchise value and position the company as a leading community bank in the Greater Washington DC Metro Area [7][9] - The company plans to explore asset disposition strategies for office loans to address evolving valuation risks [10] Management's Comments on Operating Environment and Future Outlook - Management acknowledges sustained pressure on office property valuations and the need for adequate reserves in light of market uncertainties [10][11] - The company remains optimistic about the long-term strength of the Washington DC region despite current challenges [10] - Management is actively reassessing capital allocation priorities, including shareholder return strategies, to align with forward-looking earnings [11] Other Important Information - The company has a strong capital position, with Tier one leverage increasing by 37 basis points to 11.11% [19] - Average deposits have grown by $381,600,000 from a year ago, reflecting a stable funding base [20] - The company is seeing a robust pipeline in its C and I lending, indicating potential growth in that area [76] Q&A Session Summary Question: Can you provide more details on the reserve build related to the office portfolio? - The reserve increase was driven by updated assumptions regarding probability of default and loss given default, resulting in a $14,300,000 increase to the allowance for credit losses related to the performing office portfolio [34][36] Question: What is the outlook for the C and I portfolio growth? - All indications point to an increase in the C and I portfolio growth, supported by new team members and a robust pipeline [75][78] Question: How sensitive is the margin guidance to potential Fed rate cuts? - The forecast does not include changes to Fed rate cuts, and the company is relatively neutral to interest rate movements due to its loan book structure [42][43]

Financial Data and Key Metrics Changes - The company reported net income of $1,700,000 for the quarter, reflecting continued earnings pressure compared to $15,300,000 in the prior quarter [6][21] - The provision for credit losses increased to $26,300,000, with $13,900,000 related to the increase in the office overlay [15][21] - The allowance for credit losses rose to $129,500,000, representing coverage of total loans at 1.63%, an increase of 19 basis points from the prior quarter [15][22] - Net interest income before provision totaled $65,600,000, decreasing from $70,800,000 in the prior quarter [24] - The tangible common equity ratio decreased two basis points to 11% at quarter end, while book value per share increased by $0.39 to $40.99 [22][23] Business Line Data and Key Metrics Changes - Commercial lending grew by $109,100,000 or 4.3% over the previous quarter, indicating positive momentum in this segment [9] - Deposits increased by $146,200,000, largely through time deposits in digital and branch channels [10] - Non-interest income rose to $8,200,000 for the first quarter, compared to $4,100,000 in the prior quarter, driven by a separate account BOLI transaction [27][28] Market Data and Key Metrics Changes - The company noted modest exposure to government contracting and GSA-linked assets, which reduces sensitivity to changes in federal budget spending [10] - The DC economy is diversified, including educational institutions, a growing technology sector, and tourism, supporting long-term stability [11] Company Strategy and Development Direction - The company is focused on preserving capital flexibility, improving portfolio quality, and managing through volatility while maintaining long-term franchise value [13][30] - There is an emphasis on executing a disciplined strategy to enhance franchise value and position the company as a leading community bank in the Greater Washington DC Metro Area [9][11] - The company plans to explore asset disposition strategies for office loans to address evolving valuation risks [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged sustained pressure on office property valuations and the need for adequate reserves [12] - The company remains optimistic about the long-term strength of the Washington DC region despite current uncertainties [11][30] - Management is actively reassessing capital allocation priorities, including shareholder return strategies, in light of credit conditions [13] Other Important Information - The company has a strong liquidity position with available liquidity totaling $4,800,000,000 [24] - The average deposits have grown by $381,600,000 from a year ago, reflecting a stable funding base [23] Q&A Session Summary Question: Can you provide more details on the reserve build related to the office portfolio? - The reserve increase was driven by actual appraisal experiences and updated assumptions regarding probability of default and loss given default [36][37] Question: What is the outlook for the C and I portfolio growth? - All indications point to an increase in the C and I portfolio growth due to new team members and a robust pipeline [79][80] Question: How sensitive is the margin outlook to potential Fed rate cuts? - The forecast does not include changes to Fed rate cuts, and the company is relatively neutral to interest rate movements in the short term [43][46] Question: What is the company's strategy regarding loan sales and resolutions? - The company is considering various strategies, including loan sales and aggressive resolutions, based on a cost-benefit analysis [72][73]

Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Eagle Bancorp (EGBN) reported $73.86 million in revenue for the quarter ended March 2025, representing a year-over-year decline of 5.7%. EPS of $0.06 for the same period compares to -$0.01 a year ago. The reported revenue represents a surprise of -2.81% over the Zacks Consensus Estimate ...

Group 1 - Eagle Bancorp reported quarterly earnings of $0.06 per share, missing the Zacks Consensus Estimate of $0.46 per share, and compared to a loss of $0.01 per share a year ago, representing an earnings surprise of -86.96% [1] - The company posted revenues of $73.86 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 2.81%, and down from year-ago revenues of $78.29 million [2] - Eagle Bancorp shares have declined approximately 19.9% since the beginning of the year, while the S&P 500 has declined by -10.1% [3] Group 2 - The current consensus EPS estimate for the coming quarter is $0.53 on revenues of $79.32 million, and for the current fiscal year, it is $2.31 on revenues of $323.6 million [7] - The Zacks Industry Rank for Banks - Northeast is currently in the top 23% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] Group 3 - The estimate revisions trend for Eagle Bancorp is mixed, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it is expected to perform in line with the market in the near future [6]

[Company Overview](index=3&type=section&id=Company%20Overview) Eagle Bancorp, Inc. is a prominent financial institution in the Washington D.C. metro area, holding a strong market position with over $11 billion in assets [Company Snapshot and Market Position](index=3&type=section&id=Company%20Snapshot%20and%20Market%20Position) Eagle Bancorp, Inc. is a significant financial institution headquartered in the Washington D.C. metropolitan area, holding a strong market position by deposit market share - Operates in the attractive Washington D.C. metropolitan market, which features a dynamic mix of public and private sector activity and high household incomes[8](index=8&type=chunk) - Ranks as one of the largest banks headquartered in the Washington D.C. area and is **3rd by deposit market share** for banks under **$15 billion in assets**[9](index=9&type=chunk) Eagle Bancorp at a Glance (as of March 31, 2025) | Metric | Value | | :--- | :--- | | Total Assets | $11.1 billion | | Total Deposits | $9.3 billion | | Total Loans | $7.9 billion | | Shares Outstanding | 30,368,843 | | Market Capitalization | $633 million (as of April 22, 2025) | | Tangible Book Value per Common Share | $40.59 | [Investment Highlights and Strategy](index=5&type=section&id=Investment%20Highlights%20and%20Strategy) Eagle Bancorp offers an attractive investment opportunity due to its strong capital, liquidity, disciplined cost structure, and strategic profitability initiatives [Investment Thesis and Key Strengths](index=5&type=section&id=Investment%20Thesis%20and%20Key%20Strengths) Eagle Bancorp presents an attractive investment opportunity due to its best-in-class capital levels, strong liquidity, disciplined cost structure, and strategic D.C. geography - Boasts best-in-class capital levels with a **CET1 Ratio of 14.61%**, placing it in the top quartile of bank holding companies with over **$10 billion in assets**[14](index=14&type=chunk) - Maintains a strong liquidity position, with a liquid assets to total deposits ratio of **7.3%** and total available liquidity of **$4.8 billion**; uninsured deposits represent only **25%** of total deposits[14](index=14&type=chunk) - Operates with a disciplined, branch-light cost structure, reflected in an Operating Noninterest Expense to Average Assets ratio of **1.52%** and an Operating Efficiency Ratio of **61.5%**[14](index=14&type=chunk) [Strategies for Profitability Improvement](index=6&type=section&id=Strategies%20for%20Profitability%20Improvement) The company focuses on growing and diversifying deposits, expanding its C&I team, and increasing fee income to enhance profitability and improve ROAA - Actively working to grow and deepen relationship deposits to reduce reliance on higher-cost and non-core funding sources[18](index=18&type=chunk) - Expanding the C&I team and building sales behaviors within Treasury Management to accelerate customer acquisition and deepen deposit relationships[16](index=16&type=chunk) - Maintaining pricing discipline on new loans and focusing on operating efficiency to achieve positive operating leverage[18](index=18&type=chunk) - As of Q1 2025, Eagle's **ROAA of 0.06%** is significantly lower than its peer group median[16](index=16&type=chunk) [Peer Comparison: Capital and Liquidity](index=7&type=section&id=Peer%20Comparison%3A%20Capital%20and%20Liquidity) Compared to its peers, Eagle Bancorp demonstrates superior capital and liquidity, with a high CET1 ratio and robust cash equivalents to total deposits - Capital ratios are high relative to peers, with a **CET1 ratio of 14.6%** and an Excess CET1 (over 9%) plus ACL to Total Loans ratio of **8.2%**, both ranking near the top of the peer group[20](index=20&type=chunk)[22](index=22&type=chunk) - The ratio of Cash Equivalents + AFS Securities to Total Deposits stands at **20.4%**, which is strong compared to the peer median[24](index=24&type=chunk) - Insured deposits constitute **74%** of total deposits as of Q1 2025, enhancing funding stability[24](index=24&type=chunk) [Q1 2025 Financial Performance and Outlook](index=9&type=section&id=Q1%202025%20Financial%20Performance%20and%20Outlook) Q1 2025 saw decreased net income and compressed net interest margin, with updated 2025 outlook reflecting revised NIM and increased noninterest income [Key Performance Ratios](index=9&type=section&id=Key%20Performance%20Ratios) In Q1 2025, key performance metrics showed mixed results, with decreased operating returns but a stable tangible common equity to tangible assets ratio Quarterly Performance Trends | Metric | Q4 2024 | Q1 2025 | Trend | | :--- | :--- | :--- | :--- | | Operating Return on Avg Tangible Common Equity | 4.94% | 0.55% | Decreased | | Operating Return on Assets | 0.48% | 0.06% | Decreased | | Operating Efficiency Ratio | 59.5% | 61.5% | Increased (Worsened) | | Tangible Common Equity / Tangible Assets | 11.02% | 11.00% | Stable | [Net Interest Income and Margin](index=10&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest income and margin compressed slightly in Q1 2025 due to fewer days and lower cash balances, partially offset by reduced borrowing costs Net Interest Income and Margin (QoQ) | Metric | Q4 2024 | Q1 2025 | | :--- | :--- | :--- | | Net Interest Income | $70.8 million | $65.6 million | | Net Interest Margin (NIM) | 2.29% | 2.28% | - The decrease in NII was driven by lower interest income (**$9.1 million** decrease, mainly from volume) and a smaller decrease in interest expense (**$2.8 million** decrease, mainly from yield)[33](index=33&type=chunk)[34](index=34&type=chunk) - Management expects cash flows from the investment portfolio of **$292 million** for the remainder of 2025 to be redeployed at higher yields[34](index=34&type=chunk) [Net Income Summary](index=11&type=section&id=Net%20Income%20Summary) Net income significantly decreased in Q1 2025, driven by lower net interest income and a substantial increase in the provision for credit losses Net Income Drivers (Q4 2024 vs Q1 2025) | Component | Change (in thousands) | Reason | | :--- | :--- | :--- | | Net Interest Income | $(5,145) | Fewer days in quarter, lower cash balances | | Provision for Credit Losses | $(14,123) | Increased reserve for net charge-offs and higher overlay for CRE office risk | | Noninterest Income | $4,140 | Increase in income from a new BOLI policy | | Noninterest Expense | $(1,238) | Increased legal and professional fees | [2025 Company Outlook](index=12&type=section&id=2025%20Company%20Outlook) The company updated its 2025 outlook, projecting a downward revision for net interest margin but an upward revision for noninterest income due to a Q1 gain Current 2025 Outlook | Key Driver | Current 2025 Outlook | | :--- | :--- | | **Balance Sheet** | | | Average deposits | 1-4% increase | | Average loans | 2-5% increase | | **Income Statement** | | | Net interest margin | 2.35% - 2.50% (Revised Down) | | Noninterest income | $35 - $40 million (Revised Up) | | Noninterest expense | 3-5% growth | [Balance Sheet and Funding](index=13&type=section&id=Balance%20Sheet%20and%20Funding) The balance sheet reflects increased deposits and stable loans, with a focus on managing funding costs and optimizing the investment portfolio for higher yields [Deposit and Funding Profile](index=13&type=section&id=Deposit%20and%20Funding%20Profile) Total deposits increased year-over-year to $9.3 billion, with a shift in mix and rising costs, while the company maintains significant available liquidity - Period-end deposits were **$9.3 billion**, up **$776 million** from Q1 2024, driven by growth in money market and CD accounts[43](index=43&type=chunk)[51](index=51&type=chunk) - The cost of total deposits increased to **3.40%** in Q1 2025, up from **3.17%** in Q4 2024 and **3.36%** in Q1 2024[45](index=45&type=chunk) - The company has ample access to liquidity, with over **$4.8 billion** available from the FHLB, FRB Discount Window, cash, and unencumbered securities[49](index=49&type=chunk)[53](index=53&type=chunk) [Loan Portfolio Composition and Yields](index=18&type=section&id=Loan%20Portfolio%20Composition%20and%20Yields) Total loans remained stable at $7.9 billion, with CRE as the largest segment, and a slight increase in total loan yield contributing to stable earning asset yield Loan Portfolio Composition (March 31, 2025) | Loan Category | % of Total Loans | | :--- | :--- | | Total Income Producing CRE | 50% | | Owner-occupied - commercial real estate | 18% | | Construction - commercial and residential | 15% | | Commercial (C&I) | 15% | | Other | 2% | Quarterly Yield Analysis | Yield | Q4 2024 | Q1 2025 | | :--- | :--- | :--- | | Total Loan Yield | 6.91% | 6.93% | | Securities Yield | 2.01% | 2.04% | | Total Earning Asset Yield | 5.71% | 5.71% | [Investment Portfolio](index=32&type=section&id=Investment%20Portfolio) The investment portfolio, primarily Agency MBS and Debentures, decreased due to paydowns, with projected cash flows expected to be reinvested at higher yields - The portfolio is dominated by Agency MBS (**57%**) and Agency Debentures (**25%**)[118](index=118&type=chunk) - Total securities decreased by **$98 million** from 12/31/2024 due to principal paydowns and sales[120](index=120&type=chunk) - Projected cash flow for the remainder of 2025 is **$292 million**, which is expected to be reinvested at higher yields[120](index=120&type=chunk) [Asset Quality and Credit Risk](index=19&type=section&id=Asset%20Quality%20and%20Credit%20Risk) Asset quality metrics deteriorated in Q1 2025, marked by increased provisions, higher net charge-offs, and a rise in criticized and nonaccrual loans [Key Asset Quality Metrics](index=20&type=section&id=Key%20Asset%20Quality%20Metrics) Asset quality metrics deteriorated in Q1 2025, with significant increases in provision for credit losses, net charge-offs, and non-performing assets Quarterly Asset Quality Trends | Metric | Q4 2024 | Q1 2025 | Trend | | :--- | :--- | :--- | :--- | | Provision for Credit Losses | $10.1 million | $35.2 million | Increased | | NCO / Average Loans (annualized) | 0.57% | 1.07% | Increased (Worsened) | | NPAs / Assets | 1.22% | 1.81% | Increased (Worsened) | | ACL / Loans HFI | 1.40% | 1.63% | Increased | [Classified, Criticized, and Nonaccrual Loans](index=19&type=section&id=Classified%2C%20Criticized%2C%20and%20Nonaccrual%20Loans) Criticized and classified loans increased in Q1 2025, primarily due to CRE downgrades, with nonaccrual loans concentrated in office and assisted living sectors - Total criticized and classified loans (Special Mention + Substandard) increased by **$104 million** quarter-over-quarter to **$775 million**[72](index=72&type=chunk) - The increase in Special Mention loans was driven by C&I, while the increase in Substandard loans was driven by CRE[74](index=74&type=chunk) Top Nonaccrual Loans (as of March 31, 2025) | | Purpose/Location | Balance ($000s) | % Total NPLs | | :--- | :--- | :--- | :--- | | 1 | Office - Montgomery | $73,942 | 36.9% | | 2 | Office - Washington DC | $24,660 | 12.3% | | 3 | Office - Fairfax | $18,502 | 9.2% | | 4 | Assisted Living - Montgomery | $17,934 | 8.9% | | 5 | Land - Fairfax | $16,755 | 8.4% | [Detailed Loan Portfolio Review](index=15&type=section&id=Detailed%20Loan%20Portfolio%20Review) This section provides a detailed review of the loan portfolio, focusing on the performance and risk profiles of CRE Office, Multifamily, Construction, Hotel, and GovCon segments [Commercial Real Estate (CRE) - Office](index=15&type=section&id=Commercial%20Real%20Estate%20%28CRE%29%20-%20Office) The CRE Office portfolio, totaling $994.3 million, shows risk rating deterioration and a significant maturity wall, with limited exposure to lower-class properties CRE Office Portfolio Overview (as of March 31, 2025) | Category | Balance ($M) | of Loans | % Criticized/Classified | | :--- | :--- | :--- | :--- | | Owner Occupied Office | $145.0 | 92 | 1% | | Income Producing Office | $849.3 | 72 | 30% | | **Total CRE Office** | **$994.3** | **164** | **31%** | - The risk rating for the non-office portion of the income-producing CRE portfolio has remained largely unchanged, while the office portion has seen risk rating deterioration[55](index=55&type=chunk) - A significant portion of the income-producing office portfolio matures in the near term, with **23.8%** maturing by YE 2025 and an additional **37.9%** in 2026[59](index=59&type=chunk) [Commercial Real Estate (CRE) - Multifamily](index=17&type=section&id=Commercial%20Real%20Estate%20%28CRE%29%20-%20Multifamily) The income-producing Multifamily CRE portfolio, totaling $837.0 million, exhibits strong credit quality with high 'Pass' ratings and no non-accrual loans Income Producing Multifamily Portfolio (as of March 31, 2025) | Metric | Value | | :--- | :--- | | Total CRE Balance | $837.0 million | | of Loans | 43 | | % Pass Rated | 92% | | % Criticized | 8% | | Non-Accrual % | 0% | | Weighted LTV | 63% | | Weighted DSCR | 1.2x | - There are zero multifamily loans on nonaccrual status; however, there are **4 substandard loans** totaling **$50.2 million** and **2 special mention loans** totaling **$31.7 million**[102](index=102&type=chunk) [Other Portfolios (CRE Construction, Hotel, GovCon)](index=28&type=section&id=Other%20Portfolios%20%28CRE%20Construction%2C%20Hotel%2C%20GovCon%29) Other specialized portfolios, including CRE Construction, Hotel, and GovCon, generally exhibit strong credit quality with high 'Pass' ratings and low non-accrual rates - **CRE Construction:** **$1.13 billion** total balance across 90 loans; 85 loans (**$1.1 billion**) are risk-rated 'Pass', while 5 loans (**$38.0 million**) have adverse risk ratings[109](index=109&type=chunk)[110](index=110&type=chunk)[113](index=113&type=chunk) - **Hotel:** **$431.5 million** outstanding balance across 21 loans; all loans are risk-rated 'Pass' with zero nonaccrual or criticized loans[116](index=116&type=chunk) - **GovCon:** Less than **$250 million** outstanding balance; there are zero GovCon loans on nonaccrual status, and over **30%** of balances are tied to ABL-structured lines of credit[105](index=105&type=chunk) [Appendices](index=21&type=section&id=Appendices) The appendices offer supplementary financial details, including granular loan schedules, tangible book value analysis, and non-GAAP reconciliations for enhanced transparency [Detailed Loan Schedules](index=22&type=section&id=Detailed%20Loan%20Schedules) The appendices provide granular detail on specific loan categories, including nonaccrual, special mention, substandard, and top 25 loans, with geographic breakdowns - Provides a detailed breakdown of the **8 largest nonaccrual loans**, which total **$191.4 million**, or **95.5%** of all nonaccrual loans; several were placed on nonaccrual due to new appraisals, not payment default[85](index=85&type=chunk)[86](index=86&type=chunk) - Lists **9 Special Mention loans** over **$10 million** (totaling **$245.3 million**) and **15 Substandard loans** over **$10 million** (totaling **$380.7 million**), with details on collateral, LTV, and DSCR[87](index=87&type=chunk) - The top 25 loans total **$1.62 billion**, representing **20.3%** of the total loan portfolio; the largest single exposure is a **$93.9 million** construction loan for an apartment building[89](index=89&type=chunk) [Tangible Book Value Per Share Analysis](index=33&type=section&id=Tangible%20Book%20Value%20Per%20Share%20Analysis) Tangible book value per share was $40.59, showing a slight quarterly decrease due to dividends and AOCI, but a long-term CAGR of 3.3% Q1 2025 TBV per Share Walk | Component | Per Share Amount | | :--- | :--- | | 12/31/24 TBVPS | $40.99 | | Net Income | $0.06 | | Dividend | $(0.165) | | AOCI & Other | $(0.30) (Calculated) | | **3/31/25 TBVPS** | **$40.59** | - Tangible book value per share has shown a compound annual growth rate (CAGR) of **3.3%** from **$35.74** at year-end 2020 to **$40.59** at the end of Q1 2025[123](index=123&type=chunk) [Non-GAAP Reconciliation](index=37&type=section&id=Non-GAAP%20Reconciliation) This section reconciles non-GAAP financial measures like Tangible Common Equity and Operating Net Income to GAAP equivalents, providing clearer insights into performance - Reconciles GAAP Net Income to Operating Net Income, which primarily adjusts for a one-time goodwill impairment charge of **$104.2 million** taken in Q2 2024[129](index=129&type=chunk)[133](index=133&type=chunk) - Provides calculations for tangible common equity and tangible assets by subtracting intangible assets from their corresponding GAAP measures[129](index=129&type=chunk)[133](index=133&type=chunk) - Details the calculation of the Operating Efficiency Ratio by dividing Operating Noninterest Expense by operating revenue (Net Interest Income + Noninterest Income)[131](index=131&type=chunk)[135](index=135&type=chunk)