Fourth Quarter 2024 Highlights Net income of $7.3 million, up 4.9% from 3Q24 Diluted EPS of $0.83, up 3.8% from 3Q24 Adjusted total revenue of $34.8 million1, up 2.8% from 3Q24 – 4Q24 amount includes $4.7 million of prepayment and terminated interest rate swap gains Net interest margin of 1.67% and FTE NIM of 1.75%1,2, both up 5 bps from 3Q24 Deposit costs declined 17 bps while the yield on interest earning assets only declined 6 bps SBA GOS revenue of $8.6 million; impacted by timing of originations during ...

Financial Data and Key Metrics Changes - The company reported its fourth quarter and full year 2024 financial results, with specific metrics available in the earnings press release [3][4] - Forward-looking statements regarding future performance and financial condition were highlighted, indicating potential risks and uncertainties [5] Business Line Data and Key Metrics Changes - Detailed financial results for various business lines were expected to be discussed by the CFO during the call [4] Market Data and Key Metrics Changes - Specific market data and key metrics were anticipated to be covered in the financial results presentation [4] Company Strategy and Development Direction and Industry Competition - The management team, including the CEO, was set to provide an overview of the company's strategy and competitive positioning in the industry [4] Management's Comments on Operating Environment and Future Outlook - Management's comments on the operating environment and future outlook were expected to be a significant part of the discussion [4] Other Important Information - The company provided a slide presentation for reference during the call, which included additional financial details [3] Q&A Session All Questions and Answers Question: Overview of the financial results for Q4 and full year 2024 - The CEO and CFO were prepared to discuss the financial results in detail, including any significant changes or trends observed [4]

Core Viewpoint - First Internet Bancorp (INBK) reported a significant year-over-year revenue increase of 45.1% for the quarter ended December 2024, although the earnings per share (EPS) fell short of expectations, indicating mixed financial performance [1]. Financial Performance - Revenue for the quarter was $39.49 million, exceeding the Zacks Consensus Estimate of $35.65 million by 10.76% [1]. - EPS for the quarter was $0.41, down from $0.48 a year ago, representing a -57.73% surprise compared to the consensus estimate of $0.97 [1]. - Net Interest Margin was reported at 1.7%, slightly below the estimated 1.8% [4]. - Net Interest Income (FTE) was $24.70 million, compared to the estimated $25.04 million [4]. - Total noninterest income reached $15.94 million, surpassing the average estimate of $11.73 million [4]. - Net Interest Income was reported at $23.55 million, below the estimated $23.92 million [4]. Stock Performance - Over the past month, shares of First Internet have returned -4%, contrasting with the Zacks S&P 500 composite's +2.1% change [3]. - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3].

Group 1 - First Internet Bancorp (INBK) reported quarterly earnings of $0.41 per share, missing the Zacks Consensus Estimate of $0.97 per share, and down from $0.48 per share a year ago, representing an earnings surprise of -57.73% [1] - The company posted revenues of $39.49 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 10.76%, compared to year-ago revenues of $27.21 million [2] - Over the last four quarters, First Internet has surpassed consensus revenue estimates four times, but has only exceeded consensus EPS estimates once [2] Group 2 - The stock has underperformed the market, losing about 0.3% since the beginning of the year, while the S&P 500 gained 2.9% [3] - The current consensus EPS estimate for the coming quarter is $0.70 on revenues of $33.3 million, and for the current fiscal year, it is $4.25 on revenues of $153.5 million [7] - The Zacks Industry Rank for Banks - Northeast is currently in the top 24% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Financial Performance - Net income for Q4 2024 was $7.3 million, a 4.9% increase from Q3 2024, and full year net income reached $25.3 million, up 200.3% from 2023[4][5] - Diluted earnings per share for Q4 2024 was $0.83, a 3.8% increase from Q3 2024, and for the full year, it was $2.88, up 203.2% from 2023[4][5] - Net income for Q4 2024 was $7,330,000, an increase from $6,990,000 in Q3 2024 and $4,143,000 in Q4 2023[48] - Adjusted net income for Q4 2024 was $3,591,000, compared to $6,990,000 in Q3 2024 and $4,143,000 in Q4 2023[48] - Return on average assets for Q4 2024 was 0.50%, unchanged from Q3 2024 and up from 0.32% in Q4 2023[48] - Return on average shareholders' equity for Q4 2024 was 7.49%, compared to 7.32% in Q3 2024 and 4.66% in Q4 2023[48] - Return on average tangible common equity for Q4 2024 was 7.58%, an increase from 7.41% in Q3 2024 and 4.72% in Q4 2023[49] - Adjusted return on average tangible common equity for Q4 2024 was 3.72%, consistent with 7.41% in Q3 2024 and up from 4.72% in Q4 2023[49] Income and Expenses - Net interest income for Q4 2024 was $23.6 million, an 8.2% increase from Q3 2024, and for the full year, it was $87.4 million, up 16.7% from 2023[4][5] - Noninterest income for Q4 2024 was $15.9 million, up from $12.0 million in Q3 2024, and up from $7.4 million in Q4 2023[19] - Noninterest expense totaled $24.0 million for Q4 2024, a 5.1% increase from Q3 2024, and a 19.5% increase from Q4 2023[20] - Total noninterest expense for the twelve months ended December 31, 2024, was $90,110,000, an increase of 13.4% from $79,436,000 in 2023[42] - Noninterest income for the three months ended December 31, 2024, was $15,936,000, a significant increase of 115.4% from $7,401,000 in the same period of 2023[42] Loans and Deposits - Total loans as of December 31, 2024, were $4.2 billion, a 3.3% increase from Q3 2024, and an 8.6% increase from December 31, 2023[22] - Total deposits grew by $135.5 million, a 2.8% increase from Q3 2024, and for the full year, deposits increased by $866.2 million, a 21.3% increase from 2023[4][5] - Total commercial loan balances were $3.3 billion as of December 31, 2024, a 4.3% increase from Q3 2024, and an 11.2% increase from December 31, 2023[22] - Total loans reached $4,170,646 thousand as of December 31, 2024, a 3.3% increase from $4,035,880 thousand in September 2024 and a 8.6% increase from $3,840,220 thousand in December 2023[45] - Total deposits grew to $4,933,206 thousand in December 2024, up 2.8% from $4,797,710 thousand in September 2024 and a significant increase of 21.3% from $4,066,973 thousand in December 2023[45] Asset Quality - The allowance for credit losses to total loans was 1.07% as of December 31, 2024, with nonperforming loans to total loans at 0.68%[4] - Nonperforming loans were 0.68% of total loans as of December 31, 2024, up from 0.56% as of September 30, 2024, and 0.26% as of December 31, 2023, totaling $28.4 million[26] - The allowance for credit losses (ACL) as a percentage of total loans was 1.07% as of December 31, 2024, down from 1.13% as of September 30, 2024, and up from 1.01% as of December 31, 2023[27] - Net charge-offs for the fourth quarter of 2024 were $9.4 million, resulting in a net charge-off rate of 0.91%, compared to $1.5 million (0.15%) in Q3 2024 and $1.2 million (0.12%) in Q4 2023[28] - The provision for credit losses in Q4 2024 was $7.2 million, compared to $3.4 million in Q3 2024 and $3.6 million in Q4 2023[29] Capital and Equity - Total shareholders' equity was $384.1 million as of December 31, 2024, a decrease of $1.1 million (0.3%) from September 30, 2024, and an increase of $21.3 million (5.9%) from December 31, 2023[30] - Book value per common share was $44.31 as of December 31, 2024, down from $44.43 as of September 30, 2024, and up from $41.97 as of December 31, 2023[30] - Total risk-based capital ratio was 12.61% for the Company and 12.11% for the Bank as of December 31, 2024[32] - Total equity as of December 31, 2024, is $384,063,000, an increase from $362,795,000 year-over-year[46] - Total shareholders' equity to assets ratio improved to 6.69% as of December 31, 2024, compared to 7.02% a year earlier[46] Assets - The Company had total assets of $5.7 billion as of December 31, 2024[35] - Total assets as of December 31, 2024, were $5,737,859,000, compared to $5,823,259,000 in Q3 2024 and $5,167,572,000 in Q4 2023[41] - Total assets reached $5,737,859,000 as of December 31, 2024, compared to $5,167,572,000 a year earlier, reflecting a growth of approximately 10.99%[46] Future Outlook - The Company will host a conference call on January 23, 2025, to discuss its quarterly financial results[33] - Forward-looking statements indicate potential risks including economic conditions and credit quality that could impact future performance[36]

Core Viewpoint - First Internet Bancorp (INBK) is expected to report significant growth in quarterly earnings and revenues, indicating strong performance compared to the previous year [1] Earnings Projections - Wall Street analysts predict quarterly earnings of $0.97 per share, reflecting a 102.1% increase year-over-year [1] - Revenues are forecasted to be $35.65 million, representing a year-over-year increase of 31% [1] - There has been no revision in the consensus EPS estimate over the last 30 days, indicating stability in analysts' forecasts [2] Key Financial Metrics - Analysts estimate 'Net Interest Income (FTE)' to be $25.04 million, up from $21.05 million in the same quarter last year [5] - 'Total noninterest income' is forecasted to reach $11.73 million, compared to $7.40 million in the same quarter last year [5] - Another estimate for 'Net Interest Income' is $23.92 million, an increase from $19.81 million reported in the same quarter last year [6] Stock Performance - Over the past month, First Internet shares have recorded a return of -5.6%, while the Zacks S&P 500 composite has changed by -0.4% [7] - Based on its Zacks Rank 3 (Hold), INBK is expected to perform in line with the overall market in the upcoming period [7]

Core Viewpoint - First Internet Bancorp (INBK) has shown a downtrend recently, losing 5.2% over the past week, but a hammer chart pattern suggests a potential trend reversal due to increased buying interest and support from bulls [1] Technical Analysis - The hammer chart pattern indicates a possible bottoming out, with selling pressure likely subsiding, suggesting a bullish case for INBK [1] - A hammer pattern forms when there is a small candle body with a long lower wick, signaling that bears may be losing control during a downtrend [2] Fundamental Analysis - There has been a positive trend in earnings estimate revisions for INBK, with a 2.3% increase in the consensus EPS estimate over the last 30 days, indicating analysts expect better earnings [3] - INBK holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which typically outperform the market [3] - The Zacks Rank serves as a timing indicator, suggesting that INBK's prospects are improving, reinforcing the potential for a turnaround [3]

Financial Performance - For the third quarter 2024, net income was $7.0 million, or $0.80 diluted earnings per share, representing an increase of 105.0% in net income compared to $3.4 million, or $0.39 diluted earnings per share in the third quarter 2023[232]. - During the nine months ended September 30, 2024, net income was $17.9 million, or $2.05 diluted earnings per share, an increase of 319.9% compared to $4.3 million, or $0.48 per diluted share in the same period of 2023[232]. - The increase in net income for the third quarter 2024 was primarily due to a $4.6 million, or 62.4%, increase in noninterest income and a $4.4 million, or 25.2%, increase in net interest income[233]. - The Company recognized $0.5 million in IT termination fees and $0.1 million in anniversary expenses during the nine months ended September 30, 2024, leading to an adjusted net income of $18.4 million[236]. - Adjusted net income for the nine months ended September 30, 2023, excluding the impact of exiting consumer mortgage, was $12.1 million, with adjusted diluted earnings per share of $1.35[239]. - Net income for September 30, 2024, was $6,990,000, an increase of 21.5% from $5,775,000 in June 2024[327]. - Adjusted diluted earnings per share for September 30, 2024, was $0.80, up from $0.72 in June 2024, reflecting a growth of 11.1%[327]. Assets and Liabilities - As of September 30, 2024, the Company had consolidated assets of $5.8 billion, consolidated deposits of $4.8 billion, and stockholders' equity of $385.1 million[230]. - Total assets reached $5,523,910 as of September 30, 2024, compared to $5,332,776 in the previous quarter[242]. - Total liabilities were $5,143,849 as of September 30, 2024, compared to $4,962,951 in the previous quarter[242]. - Shareholders' equity totaled $380,061 as of September 30, 2024, compared to $369,825 in the previous quarter[242]. - Total assets as of September 30, 2024, were $5,823,259,000, an increase from $5,169,023,000 as of September 30, 2023, representing a growth of 12.6%[323]. - Tangible common equity as of September 30, 2024, was $380,442,000, up from $343,057,000 a year earlier, marking an increase of 10.9%[323]. Income and Expenses - Total interest income for Q3 2024 increased by $12.0 million, or 19.0%, to $75.0 million from $63.0 million in Q3 2023[248]. - Total interest expense for Q3 2024 rose by $7.6 million, or 16.6%, to $53.2 million from $45.6 million in Q3 2023[248]. - Total noninterest expense for Q3 2024 was $22.8 million, up 15.4% from $19.8 million in Q3 2023, mainly due to higher salaries and employee benefits[265]. - Noninterest income for Q3 2024 was $12.0 million, a 62.4% increase from $7.4 million in Q3 2023, primarily driven by gains on loan sales[260]. - The increase in salaries and employee benefits for Q3 2024 was primarily due to higher small business lending incentive compensation and staff additions[265]. - Noninterest expense for the three months ended September 30, 2024, was $22,794,000, a rise of 15.4% from $19,756,000 in the same quarter of 2023[326]. Loans and Credit Quality - Loans increased to $4.0 billion as of September 30, 2024, compared to $3.7 billion as of September 30, 2023[269]. - Total nonperforming loans increased by $12.5 million, or 125.6%, to $22.5 million as of September 30, 2024, compared to $10.0 million as of December 31, 2023[282]. - The allowance for credit losses - loans to total loans ratio was 1.13% as of September 30, 2024, up from 1.10% in the previous quarter[281]. - The total nonperforming loans to total loans ratio increased to 0.56% as of September 30, 2024, compared to 0.33% in the previous quarter[281]. - The company experienced a slight decrease in public finance and single tenant lease financing portfolios, along with continued runoff in the healthcare finance portfolio[277]. - The company experienced a partial charge-off of C&I participation loans amounting to $5,462,000[327]. Deposits and Funding - Total deposits increased by $730.7 million, or 18.0%, to $4.8 billion as of September 30, 2024, compared to $4.1 billion as of December 31, 2023[299]. - Certificates of deposits rose by $505.5 million, or 31.5%, driven by strong consumer and small business demand throughout 2024[299]. - Interest-bearing demand deposits increased by $135.5 million, or 33.6%, primarily from growth in fintech partnership deposits[299]. - The Company maintained a Common Equity Tier 1 capital ratio of 9.37% as of September 30, 2024, exceeding the minimum required ratio of 7.00%[307]. - The company can borrow an additional $1.4 billion from various funding sources, totaling $2.1 billion in liquidity, which is 230% of adjusted uninsured deposit balances[317]. Capital and Shareholder Returns - The company declared a cash dividend of $0.06 per share, payable on October 15, 2024, to shareholders of record as of September 30, 2024[310]. - The company repurchased 559,522 shares of common stock at an average price of $19.06, totaling an investment of $10.7 million under a $25.0 million stock repurchase program[313]. - The total capital to risk-weighted assets ratio for the consolidated entity was 13.23%, well above the minimum required ratio of 10.50%[309]. - The leverage ratio for the consolidated entity was 7.33%, significantly higher than the minimum requirement of 4.00%[309]. Future Outlook and Strategy - Future outlook includes continued focus on revenue growth and cost management strategies to enhance profitability[326]. - The company believes it has sufficient liquidity and capital resources to meet its cash and capital expenditure requirements for the next twelve months[312].

Group 1 - First Internet Bancorp (INBK) closed at $33.35, with a 0.1% gain over the past four weeks, and a mean price target of $41.70 suggests a 25% upside potential [1] - The mean estimate includes five short-term price targets with a standard deviation of $2.91, indicating variability among analysts; the lowest estimate is $38.50 (15.4% increase), while the highest is $45 (34.9% increase) [2] - Analysts show strong agreement in revising earnings estimates higher, which correlates with potential stock price increases [9][10] Group 2 - The Zacks Consensus Estimate for the current year has increased by 2.3%, with one estimate moving higher and no negative revisions [10] - INBK holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [11] - While the consensus price target may not be a reliable indicator, the direction of price movement implied by it appears to be a good guide for potential upside [11]

Financial Data and Key Metrics Changes - The company reported net income of $7 million, up 21% from the previous quarter, and diluted earnings per share of $0.80, up over 19% [7][8] - Total operating revenue grew over 4% compared to the prior quarter and increased over 36% year-over-year [6][10] - Net interest income was $21.8 million, up 2.1% from the second quarter, and net interest margin was 1.62%, a decrease of 5 basis points from the previous quarter [18][20] Business Line Data and Key Metrics Changes - The small business lending team reported a 35% increase in year-to-date SBA loan originations and a nearly 60% increase in sold loan volume compared to 2023 [9][10] - Non-interest income for the quarter was $12 million, up 9% from the second quarter, with gain on sale of loans totaling $9.9 million, a 20% increase [22][23] - The overall credit quality remains sound, with nonperforming loans to total loans at 56 basis points and nonperforming assets to total assets at 39 basis points [10][24] Market Data and Key Metrics Changes - Total deposits increased by almost $524 million, or 12% from the prior quarter, driven by growth in CD production and fintech partnership deposits [14][15] - Deposits from fintech partners were up 35% from the second quarter, totaling $507 million at quarter end [15] - The weighted average cost of new CDs was 4.45%, which is over 30 basis points lower than the average cost of maturing CDs [17][18] Company Strategy and Development Direction - The company aims to continue diversifying revenue and improving the composition of its loan portfolio, focusing on small business lending and construction loans [9][14] - There is a strong emphasis on maintaining balance sheet flexibility and liquidity, with a loan-to-deposit ratio declining to 84% from 93% [18][20] - The management is optimistic about achieving higher earnings and improved profitability in the fourth quarter and into 2025 [14][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued earnings momentum and the potential for net interest margin to rebound as liquidity is deployed [14][27] - The company anticipates a solid loan pipeline and expects loan balances to increase by 1.5% to 2% in the fourth quarter [26][49] - Management noted that the economic environment is stabilizing, with inflation slowing and interest rates expected to decline, which should benefit small business owners [34][36] Other Important Information - The tangible book value per share increased by 3.6% in the third quarter and is up almost 11% year-over-year [11] - The allowance for credit losses as a percentage of total loans was 1.13%, reflecting growth in the loan portfolio [24] - The company plans to invest in technology to enhance the digital experience and add product features for consumers and small businesses [27][51] Q&A Session Summary Question: Can you provide details on the franchise finance and small business loans that were past due? - Management indicated that there were a few delinquencies in franchise finance due to certain brand closures, and they are working with borrowers to restructure loans [29][30] Question: What are the expectations for SBA origination growth? - The company targets $600 million in SBA originations for next year, with a strong team in place to support this growth [40][41] Question: How should we think about the NIM trajectory for 2025? - Management expects significant net interest income growth next year, with potential margin expansion driven by the deployment of excess liquidity [44][46] Question: What are the preliminary thoughts on expense growth in 2025? - Expense growth is expected to be around 7% to 8%, with potential increases if SBA revenue ramps up significantly [54][55] Question: What is the outlook for the tax rate going forward? - The tax rate is expected to range from high 8% to 11% to 12% by the end of the year, depending on pre-tax earnings growth [56]