PORTLAND, Maine, Sept. 30, 2025 (GLOBE NEWSWIRE) -- Northeast Bank (the “Bank” or “Northeast”) (NASDAQ: NBN), a Maine-based bank, announced that Richard Cohen has informed the Bank that he will step down as Chief Financial Officer to pursue other opportunities. Mr. Cohen will continue in his role through October 31, 2025. Santino Delmolino, who currently serves as the Corporate Controller of the Bank, will assume the role of CFO, effective October 31, 2025. “Richard has been a remarkable leader throughout h ...

Core Insights - The Bonhoeffer Fund focused on selling slower-growth firms and acquiring durable, faster-growing companies in depressed sectors, aligning with long-term growth themes such as consolidation and financial compounders [7][11] - The fund achieved a net gain of 8.7% in Q2 2025, underperforming compared to the MSCI World ex-US and S&P 500, which returned 12.1% and 10.8% respectively [9][10] - The portfolio's projected earnings/free cash flow growth is approximately 16%, with a weighted average earnings/free cash flow yield of 12.5% [10][11] Investment Themes - **Distribution (49% of Portfolio)**: The fund holds high-velocity distributors in various markets, focusing on car dealerships and building product distributors, which have shown a quarterly performance of 6% [14] - **Real Estate/Construction/Finance (58% of Portfolio)**: Investments in construction firms are expected to benefit from government infrastructure programs and affordable housing financing, with banks showing sustainable ROEs and EPS growth rates above 15% [18][19] - **Public Leverage Buyouts (31% of Portfolio)**: The strategy involves growth through acquisitions, with firms like Builders First Source (BFS) utilizing local economies of scale to generate high returns [22][24] - **Compound Mispricings (15% of Portfolio)**: Investments in Korean preferred stocks and Asian real estate are characterized by governance improvements and liquidity, with Vistry facing challenges but still focusing on affordable housing [31][32] - **Telecom/Transaction Processing (3% of Portfolio)**: Companies like Millicom are positioned to benefit from reduced competition and favorable market conditions, with a focus on cost-cutting and dividend yields [33][35] - **Consumer Products (3% of Portfolio)**: Defensive consumer product firms are expected to perform well, with Academy Sports facing challenges but retaining potential for recovery [36][37] Financial Metrics - The Bonhoeffer Fund's portfolio has an average EV/EBITDA of 3.2 and a growth rate of 16% [9][10] - Arrow Electronics is projected to have a 27% EPS growth rate through 2029, with a future share price estimated at $39 [17] - Builders First Source (BFS) is expected to see a recovery in share price with a projected value of around $505 per share based on a 32% IRR [30]

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Financial Data and Key Metrics Changes - Net income for the quarter was $25,200,000, a record excluding one-time sales of PPP loans [5] - Total revenue for the quarter was $62,700,000, also a record when excluding PPP loan gains [10] - Net interest margin was strong at 5.1%, with a return on equity of 20.73% and return on assets at 2.38% [8][9] - Earnings per share were $3.06 basic and $3 fully diluted [8] - The allowance for credit losses over gross loans increased to 1.28% from 1.23% in the previous quarter [9] Business Line Data and Key Metrics Changes - The loan portfolio grew by 36% overall, with purchased loans up 40%, originated loans up 27%, and SBA loans up over 200% [12] - For the quarter, $362,600,000 in total loan originations and purchases were recorded, with $216,600,000 in originated loans [5][6] - SBA loan originations for the quarter were $107,300,000, totaling $408,500,000 for the year [7][14] Market Data and Key Metrics Changes - The company noted increased competition in the purchased loan market, with more capital and cheaper leverage available [13] - The SBA tightened eligibility requirements, which is expected to temporarily reduce loan volumes by up to 50% in the coming quarters [14] Company Strategy and Development Direction - The company plans to remain active but disciplined in the purchased loan market, focusing on opportunities while managing competition [13] - There is an emphasis on expanding into new verticals and adjusting marketing efforts to attract suitable borrowers in the SBA segment [25] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the challenges posed by new SBA regulations and the overall market environment [25] - The company believes that New York City will continue to be a strong multifamily market, providing future opportunities despite potential rent control impacts [16] Other Important Information - The company is investing in new technologies and automation to drive efficiency gains, with a significant hire in the role of chief of innovation [44] - The effective tax rate is expected to stabilize between 33% to 34% going forward [37] Q&A Session Summary Question: When do you expect SBA volumes to snap back after the decline? - Management indicated it is hard to predict exactly, but they believe they will climb back as they adjust to new processes and market conditions [23][24] Question: How does the current pool of loans for purchase compare to last quarter? - There is a lot of activity in the market, with optimism about the volume and competition for larger transactions [27][30] Question: How much transactional income impacted the net interest margin this quarter? - Transactional income was $4,094,000, which contributed significantly to the margin [31][32] Question: Will there be any offset on the expense side as SBA volumes decrease? - A significant portion of costs is variable, so expenses would decrease with lower volumes, although some fixed costs would remain [41][42] Question: Are there any new technology investments planned? - The company is planning major investments in technology and workflow AI to enhance efficiency [44]

Financial Performance - Net income for Q4 FY25 was $25215 million, and year-to-date net income reached $834 million[4] - Net interest margin stood at 510% for Q4 FY25 and 482% year-to-date[4] - Return on equity was 2073% and return on assets was 238% for Q4 FY25[4] - Basic earnings per share (EPS) for Q4 FY25 were $306 ($300 diluted), and year-to-date EPS were $1031 ($1008 diluted)[4] Loan Portfolio - Total loan volume for Q4 FY25 was $3626 million, with a year-to-date volume of $21 billion[4] - National Lending invested $417 million on $444 million of UPB in Q4 FY25, and $8632 million on $9461 million of UPB year-to-date[4] - SBA loans originated in Q4 FY25 amounted to $1043 million, with $1076 million sold, resulting in a gain on sale of $82 million[4] - Purchased loans constitute the largest portion of the National Lending portfolio, with a total balance of $2375157 million and an average LTV of 50%[7] Deposit Portfolio - The grand total of deposits reached $3375600 million as of June 30, 2025, with a weighted average rate (WAR) of 373%[48] - Brokered deposits make up 47% of the deposit mix, totaling $1595857 million with a WAR of 411%[48]

Company Announcement - Northeast Bank will host a conference call with a simultaneous webcast on July 29, 2025, to discuss its fiscal 2025 fourth quarter earnings [1] - The earnings results will be released on July 28, 2025, as previously announced [2] Access Information - To access the conference call by phone, attendees must register through a provided link to receive dial-in details [3] - The call will also be available via a live webcast on the Bank's website, with a slide presentation accompanying the broadcast [3] - A replay of the webcast will be available online for one year for those unable to listen live [3] Company Overview - Northeast Bank is headquartered in Portland, Maine, and offers personal and business banking services through seven branches [4] - The Bank's National Lending Division engages in purchasing and originating commercial loans nationwide [4] - ableBanking, a division of Northeast Bank, provides online savings products to consumers across the country [4]

Core Viewpoint - Northeast Bank is set to release its fiscal 2025 fourth quarter earnings results on July 28, 2025, followed by a conference call on July 31, 2025, at 10:00 a.m. ET [1] Group 1 - The conference call will be hosted by key executives including Rick Wayne (President and CEO), Richard Cohen (CFO), and Pat Dignan (COO) [1] - The call will be accessible via phone registration and a live webcast on the Bank's website [2] - A slide presentation will accompany the webcast, and a replay will be available online for one year [2] Group 2 - Northeast Bank is headquartered in Portland, Maine, and offers personal and business banking services through seven branches [3] - The Bank's National Lending Division engages in purchasing and originating commercial loans nationwide [3] - ableBanking, a division of Northeast Bank, provides online savings products to consumers across the country [3]

Group 1 - Northeast Bank (NASDAQ: NBN) has faced challenges in recent months, leading to a reaffirmation of its status as a 'hold' candidate [1] - The company previously had a bullish outlook, indicating potential for recovery or growth in the future [1] Group 2 - Crude Value Insights provides an investment service focused on oil and natural gas, emphasizing cash flow and growth prospects [1] - Subscribers benefit from a model account with over 50 stocks, detailed cash flow analyses of exploration and production firms, and live sector discussions [2]

Financial Data and Key Metrics Changes - The company reported a loan volume of $414 million for the quarter, with $74.6 million in purchased loans and $218 million in originated loans, marking the second-best quarter for commercial real estate loan originations [5] - Net income was $18.7 million, which is $4.8 million higher than the same quarter last year but $3.7 million lower than the linked quarter [5][6] - Return on equity (ROE) was 16.47% and return on assets (ROA) was 1.86%, with tangible book value growing to $54.84 [6] - Net interest income decreased by $2.5 million from the linked quarter, primarily due to less accelerated income from loan payoffs and a shorter quarter [6][8] - Non-interest income increased to $6.6 million, up $700,000 from the linked quarter, mainly due to gains from the SBA business [8] Business Line Data and Key Metrics Changes - The SBA volume reached $121.3 million, up from approximately $100 million in the linked quarter, indicating significant growth in this segment [5][15] - The number of SBA loans originated increased from 330 to 1,069 year-over-year, showcasing substantial growth in loan units [12] - The company purchased 52 loans with gross balances of $79 million, with a purchase price of $75 million, reflecting ongoing activity in the purchase loan segment [16] Market Data and Key Metrics Changes - The company noted a cautious optimism in the real estate markets, with some investors on the sidelines while others view real estate as a good inflation hedge [19] - The SBA business is expected to face some delays in loan closings due to new documentation and collateral requirements, but long-term growth prospects remain strong [15][51] Company Strategy and Development Direction - The company aims to build its SBA business as an annuity, with a focus on long-term growth despite short-term regulatory changes [11][15] - Management expressed confidence in their ability to source quality loans and assess risks, emphasizing a patient investment approach [19] - The company is exploring new small business loan products and refining technology to enhance efficiency in the SBA segment [51][55] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of recent rate cuts on loan yields, particularly in the SBA portfolio, and indicated plans to implement risk-based pricing [27][24] - The company is optimistic about the pipeline for future loan origination, although external economic factors may introduce uncertainty [31][32] - Management highlighted the importance of maintaining liquidity and balance sheet capacity for future opportunities [58][60] Other Important Information - The tax rate increased to 36.7% compared to 33% in the prior quarter, influenced by changes in state tax laws [9][10] - The company has approximately $870 million in balance sheet capacity for loan pool purchases, which could increase with earnings or stock sales [45][49] Q&A Session Summary Question: What is the outlook for loan yields, particularly on the SBA side? - Management noted that SBA loans are currently priced at prime plus 2.75% and are considering risk-based pricing to address yield changes [24][25] Question: Was the increase in expenses a catch-up on comp accruals? - Management confirmed that the $1 million in incentive compensation was a catch-up for the third quarter, with expectations for similar accruals in the fourth quarter [29][30] Question: How does the pipeline look for loan growth? - Management indicated a full pipeline and expressed cautious optimism about origination volume, while acknowledging potential economic uncertainties [31][32] Question: What is the company's balance sheet capacity for loan pool purchases? - The company has a capacity of $870 million for loan pool purchases, which could increase with earnings [45][49] Question: How should we think about the long-term growth of the SBA business? - Management is very positive about the SBA business, expecting growth despite potential short-term delays due to regulatory changes [51][52]

Financial Data and Key Metrics Changes - The company reported a loan volume of $414 million for the quarter, with $74.6 million in purchased loans and $218 million in originated loans, marking the second-best quarter for commercial real estate loan originations [5][6] - Net income was $18.7 million, which is $4.8 million higher than the same quarter last year but $3.7 million lower than the linked quarter [5][6] - Return on equity (ROE) was 16.47% and return on assets (ROA) was 1.86%, with tangible book value growing to $54.84 [6][10] - Net interest income decreased by $2.5 million from the linked quarter, primarily due to less accelerated income from loan payoffs and a shorter quarter [6][9] Business Line Data and Key Metrics Changes - The SBA volume increased to $121.3 million from approximately $100 million in the linked quarter, with a significant rise in the number of loans originated [5][16] - The company originated 1,069 SBA loans in the quarter, up from 330 loans a year ago, indicating substantial growth in the SBA business [13][14] - Non-interest income was $6.6 million, $700,000 higher than the linked quarter, mainly due to SBA gains [9] Market Data and Key Metrics Changes - The company noted a cautious optimism in the real estate markets, with some investors on the sidelines while others view real estate as a good inflation hedge [20] - The SBA has revised regulations, which may impact the speed of loan closures but is viewed positively from a credit perspective [16][20] Company Strategy and Development Direction - The company aims to build its SBA business as an annuity and is optimistic about future growth despite regulatory changes that may slow down the immediate ramp-up [12][53] - The company is focused on maintaining a strong pipeline and is prepared to take advantage of market opportunities, especially in uncertain economic conditions [20][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the quality of the core business despite a decrease in income compared to the linked quarter, attributing it to non-recurring items [12] - The company is patient in its investment approach and is confident in its ability to source good loans while assessing risks effectively [20] Other Important Information - The tax rate increased to 36.7% from 33% in the prior quarter due to recurring charges and adjustments related to state tax liabilities [10][11] - The company has a balance sheet capacity for loan pool purchases of $870 million, which could increase as more income is earned [48][51] Q&A Session Summary Question: What is the outlook for loan yields, particularly on the SBA side? - Management noted that all SBA loans are currently priced at prime plus 2.75% and will consider risk-based pricing for smaller loans [25][26] Question: Was this quarter a catch-up on comp accruals, and what should be expected going forward? - The comp was partly a catch-up, with expectations for similar levels in the upcoming quarters [30][31] Question: How is the pipeline looking for loan growth? - The pipeline remains strong, but there are uncertainties in the economy that could impact origination volume [32][33] Question: What is the reason for the increase in the discount paid on purchases this quarter? - The discount is influenced by interest rate dynamics and should not be interpreted as a shift in market conditions [34][35] Question: What is the long-term outlook for the SBA business? - Management is very positive about the SBA program's growth potential, despite a potential short-term decline due to regulatory changes [52][54]