South Bend, Indiana--(Newsfile Corp. - December 18, 2025) - 1st Source Corporation (NASDAQ: SRCE) announces the retirement of John Griffith, Executive Vice President and Chief Risk Officer of both the Corporation and 1st Source Bank, effective December 31, 2025. Mr. Griffith has served the organization for almost 25 years, joining 1st Source in 2001 as Senior Vice President, General Counsel, and Secretary of the Board. In 2011, he was elevated to Executive Vice President and Chief Risk Officer, retaining h ...

Core Points - 1st Source Bank has announced the promotion of John Bedient to Chief Operating Officer and Dan Lifferth to Chief Administrative Officer as part of recent leadership changes [1][2][3] - The promotions are aimed at aligning responsibilities and ensuring long-term success for the bank and its parent company, 1st Source Corporation [2][3] Leadership Changes - John Bedient has been with 1st Source Bank since 1991 and has held various key roles, including overseeing strategic projects and the implementation of advanced banking technologies [3][4] - Dan Lifferth has served as Senior Vice President of Human Resources since 2015, focusing on employee engagement and leadership development initiatives [4][5] Company Overview - 1st Source Corporation, the parent company of 1st Source Bank, has assets totaling $9.1 billion and operates 78 banking centers, 18 Specialty Finance Group locations, and various other financial service offices [9] - The corporation has a long-standing commitment to helping clients achieve financial security and build wealth, with over 160 years of service in the financial industry [9]

Core Viewpoint - The article emphasizes the importance of value investing and highlights 1st Source (SRCE) as a strong candidate for value investors due to its favorable financial metrics and Zacks Rank [2][3][6] Company Analysis - 1st Source (SRCE) holds a Zacks Rank of 2 (Buy) and has received an "A" grade in the Value category, indicating it is among the strongest value stocks currently available [3] - The company's price-to-book (P/B) ratio is 1.24, which is lower than the industry average of 1.91, suggesting that SRCE is undervalued compared to its peers [4] - SRCE's P/CF ratio stands at 10.31, significantly lower than the industry average of 13.99, further indicating its potential undervaluation [5] - Over the past year, SRCE's P/B has fluctuated between 1.07 and 1.40, with a median of 1.24, while its P/CF has ranged from 8.55 to 11.36, with a median of 10.06 [4][5] Investment Outlook - The combination of SRCE's strong earnings outlook and its attractive valuation metrics positions it as a compelling value stock for investors at this time [6]

Core Viewpoint - 1st Source (SRCE) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [3][5]. - Institutional investors rely on earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [3]. Company Performance and Outlook - The upgrade reflects an improvement in 1st Source's underlying business, suggesting that investors may respond positively by driving the stock price higher [4]. - The Zacks Consensus Estimate for 1st Source is projected at $6.43 per share for the fiscal year ending December 2025, with a 3.5% increase in estimates over the past three months [7]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [6]. - The upgrade to Zacks Rank 2 places 1st Source in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [9].

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Core Insights - 1st Source (SRCE) reported quarterly earnings of $1.71 per share, exceeding the Zacks Consensus Estimate of $1.59 per share, and up from $1.41 per share a year ago, representing an earnings surprise of +7.55% [1] - The company achieved revenues of $110.66 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 0.69%, and an increase from $97.93 million year-over-year [2] - 1st Source has consistently surpassed consensus EPS and revenue estimates over the last four quarters [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.60 on revenues of $111.7 million, and for the current fiscal year, it is $6.22 on revenues of $435 million [7] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Banks - Midwest industry, to which 1st Source belongs, is currently ranked in the top 26% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Performance - Net income available to common shareholders for the nine months ended September 30, 2025, was $117.14 million, compared to $101.19 million for the same period in 2024, reflecting an increase in net interest income and noninterest income [186]. - Diluted net income per common share increased to $4.74 for the nine months ended September 30, 2025, compared to $4.09 for the same period in 2024 [186]. - Taxable-equivalent net interest income for Q3 2025 was $88.90 million, an increase of 17.55% compared to Q3 2024 [191]. - Taxable-equivalent net interest income for the nine months ended September 30, 2025, was $255.33 million, an increase of 15.07% compared to the same period in 2024 [198]. - The net interest margin on a fully taxable-equivalent basis improved to 4.00% for the nine months ended September 30, 2025, compared to 3.59% for the same period in 2024 [198]. Asset and Liability Management - Total assets increased to $9.06 billion, up $124.75 million or 1.40% from December 31, 2024 [166]. - Total loans and leases rose to $6.96 billion, an increase of $109.65 million or 1.60% from December 31, 2024, driven by growth in renewable energy and residential real estate portfolios [167]. - Total deposits reached $7.41 billion, an increase of $179.78 million or 2.49% from the end of 2024, primarily due to higher savings and time deposits [169]. - Cash and cash equivalents totaled $214.26 million, an increase from $124.83 million at December 31, 2024, primarily due to increased deposits [183]. - The loan to asset ratio was 76.90% at September 30, 2025, compared to 76.74% at December 31, 2024 [183]. Shareholder Equity - Total shareholders' equity was $1.24 billion, up $125.40 million or 11.29% from December 31, 2024, with a shareholders' equity-to-assets ratio of 13.65% [174]. - The accumulated other comprehensive loss component of shareholders' equity decreased to $45.86 million at September 30, 2025, from $87.23 million at December 31, 2024 [174]. - The dividend payout ratio for the trailing four quarters was 24.63%, with cash dividends per common share of $0.38 declared during the third quarter of 2025 [175]. Interest Income and Expenses - Average earning assets increased by $352.52 million, or 4.26%, over the same period in 2024 [192]. - The yield on average earning assets rose to 6.03%, up 10 basis points from 5.93% in Q3 2024 [192]. - Total cost of average interest-bearing liabilities decreased by 48 basis points to 2.79% from 3.27% [192]. - Net interest margin on a fully taxable-equivalent basis was 4.09% for Q3 2025, compared to 3.64% for Q3 2024 [191]. Noninterest Income and Expenses - Total noninterest income for the three months ended September 30, 2025, was $21.906 million, a decrease of 2.41% compared to $22.448 million in 2024 [223]. - Trust and wealth advisory fees increased by 4.61% to $6.825 million for the three months ended September 30, 2025, compared to $6.524 million in 2024 [223]. - Insurance commissions rose by 12.43% to $1.845 million for the three months ended September 30, 2025, compared to $1.641 million in 2024 [223]. - Total noninterest expense increased by 7.77% to $54.776 million for the three months ended September 30, 2025, compared to $50.828 million in 2024 [234]. - Salaries and employee benefits rose by 3.02% to $32.217 million for the three months ended September 30, 2025, compared to $31.274 million in 2024 [234]. - Business development and marketing expenses surged by 70.32% to $2.846 million for the three months ended September 30, 2025, compared to $1.671 million in 2024 [234]. Credit Quality - The provision for credit losses for the nine months ended September 30, 2025, was $11.85 million, compared to $8.89 million for the same period in 2024 [207]. - Nonperforming assets totaled $63.19 million at September 30, 2025, an increase of 101.67% from $31.33 million reported at December 31, 2024 [215]. - The allowance for loan and lease losses as a percentage of loans and leases outstanding was 2.32% at September 30, 2025, compared to 2.30% one year ago [211]. - Net charge-offs for the first nine months of 2025 were $3.93 million or 0.08% of average loans and leases, compared to $4.99 million or 0.10% for the same period in 2024 [207]. Market and Taxation - The market value of trust assets under management increased to $6.07 billion as of September 30, 2025, from $6.03 billion a year ago [224]. - The provision for income taxes for the three months ended September 30, 2025, was $12.71 million, compared to $10.47 million for the same period in 2024 [242]. - The effective tax rate for the quarter ended September 30, 2025, was 23.11%, compared to 23.07% for the same quarter in 2024 [242].

Financial Performance - Record quarterly net income of $42.30 million for Q3 2025, up 13.34% from the previous quarter and up 21.06% year-over-year [2] - Diluted net income per common share for Q3 2025 was $1.71, an increase of 13.25% from the previous quarter and 21.28% from Q3 2024 [4] - Net income available to common shareholders reached $42,296,000 in Q3 2025, a 5.2% increase from $37,319,000 in Q2 2025 and a 21.0% increase from $34,937,000 in Q3 2024 [38] - Net income for Q3 2025 was $42,279,000, representing a 21.0% increase from $34,914,000 in Q3 2024 [41] - Basic net income per common share for Q3 2025 was $1.71, up from $1.41 in Q3 2024, reflecting a 21.3% increase [41] Asset and Equity Growth - Total assets increased to $9,033,539,000 in Q3 2025 from $8,962,134,000 in Q2 2025, representing a growth of 1.2% [38] - Total assets as of September 30, 2025, amounted to $9,056,691, a slight decrease from $9,087,162 as of June 30, 2025 [40] - Total equity increased to $1,291,431,000 at the end of Q3 2025, compared to $1,257,424,000 at the end of Q2 2025 [38] - Total shareholders' equity rose to $1,236,472, compared to $1,198,589 in the previous quarter, marking an increase of about 3.2% [40] - Total common shareholders' equity increased to $1,236,472, up from $1,104,253, reflecting a growth of 12% year-over-year [47] Loan and Deposit Trends - Average loans and leases grew by $46.93 million in Q3 2025, up 0.67% from the previous quarter and $409.71 million, or 6.20%, from Q3 2024 [12] - Average deposits increased by $75.03 million in Q3 2025, up 1.02% from the previous quarter and $289.69 million, or 4.06%, from Q3 2024 [13] - Loans and leases at the end of Q3 2025 were $6,964,454,000, a decrease from $7,097,969,000 in Q2 2025 [38] - Net loans and leases decreased to $6,803,024 from $6,934,485 in the previous quarter, reflecting a decline of approximately 1.9% [40] - Total deposits were reported at $7,409,819, down from $7,442,669 in the prior quarter, indicating a decrease of about 0.4% [40] Income and Expense Analysis - Tax-equivalent net interest income for Q3 2025 was $88.90 million, up 4.17% from the previous quarter and 17.55% year-over-year [14] - Net interest income for Q3 2025 was $88,750,000, up 4.3% from $85,192,000 in Q2 2025 and 17.5% from $75,486,000 in Q3 2024 [38] - Noninterest income for Q3 2025 was $21,906,000, down from $23,057,000 in Q2 2025, indicating a decline of 5.0% [38] - Total noninterest expense for Q3 2025 was $54,776,000, an increase of 7.8% from $50,828,000 in Q3 2024 [41] - Noninterest expense for Q3 2025 was $54.78 million, an increase of 4.47% from the prior quarter and 7.77% from Q3 2024 [21] Efficiency and Ratios - The efficiency ratio improved to 49.50% in Q3 2025 from 48.43% in Q2 2025, indicating better cost management [38] - Return on average assets increased to 1.86% in Q3 2025, up from 1.67% in Q2 2025 and 1.59% in Q3 2024 [38] - The net interest margin improved to 4.08% in Q3 2025, compared to 4.00% in Q2 2025 and 3.63% in Q3 2024 [38] - The tangible common equity-to-tangible assets ratio was 12.85% as of September 30, 2025, compared to 11.76% a year earlier [46] - The efficiency ratio (GAAP-derived) improved to 49.63% for the nine months ended September 30, 2025, down from 51.64% in the same period last year [46] Credit Quality - Provision for credit losses was $0.90 million in Q3 2025, a decrease of $6.79 million from the previous quarter [25] - The allowance for loan and lease losses was 2.32% of total loans and leases as of September 30, 2025, up from 2.30% at June 30, 2025 [24] - The provision for credit losses totaled $896,000 in Q3 2025, a decrease from $1,723,000 in Q3 2024, indicating improved credit quality [41]

Core Insights - 1st Source Corporation reported record quarterly net income of $42.30 million for Q3 2025, representing a 13.34% increase from the previous quarter and a 21.06% increase year-over-year [2][7] - The company declared a cash dividend increase of two cents per share, raising it to $0.40, which is an 11.11% increase from the previous year [3][7] - The financial results were driven by growth in net interest income and improved credit quality, despite some realized losses from strategic repositioning in the investment portfolio [2][4][7] Financial Performance - Net income for Q3 2025 was $42.30 million, up $4.98 million or 13.34% from Q2 2025 and up $7.36 million or 21.06% from Q3 2024 [2][7] - Diluted net income per common share for Q3 2025 was $1.71, an increase of 13.25% from the previous quarter and 21.28% from the same quarter last year [2][7] - Year-to-date net income for 2025 reached $117.14 million, a 15.76% increase compared to the same period in 2024 [2] Balance Sheet and Capital - The common equity-to-assets ratio improved to 13.65% as of September 30, 2025, compared to 13.19% at June 30, 2025 [27] - The tangible common equity-to-tangible assets ratio was 12.85% at the end of Q3 2025, up from 12.38% in the previous quarter [27] - The Common Equity Tier 1 ratio was 15.18% as of September 30, 2025, compared to 14.60% at June 30, 2025 [27] Loans and Deposits - Average loans and leases for Q3 2025 were $7.02 billion, an increase of $46.93 million or 0.67% from the previous quarter and up $409.71 million or 6.20% year-over-year [12] - Average deposits increased to $7.42 billion in Q3 2025, up $75.03 million or 1.02% from the previous quarter and up $289.69 million or 4.06% from the same quarter last year [13] Net Interest Income and Margin - Tax-equivalent net interest income for Q3 2025 was $88.90 million, up $3.56 million or 4.17% from the previous quarter and up $13.27 million or 17.55% year-over-year [14] - The net interest margin for Q3 2025 was 4.09%, an increase of eight basis points from the previous quarter and 45 basis points from the same period in 2024 [15] Noninterest Income and Expense - Noninterest income for Q3 2025 was $21.91 million, a decrease of $1.15 million or 4.99% from the previous quarter and a decrease of $0.54 million or 2.41% year-over-year [17] - Noninterest expense increased to $54.78 million in Q3 2025, up $2.35 million or 4.47% from the prior quarter and up $3.95 million or 7.77% from the same quarter last year [22] Leadership Transition - Christopher J. Murphy III stepped down as CEO effective October 1, 2025, transitioning to Executive Chairman, while Andrea G. Short took over as CEO [8][9] - The leadership transition is part of a long-term strategy to ensure continuity and stability within the organization [8][10]

Group 1: Smithfield Foods, Inc. - Smithfield Foods, Inc. is a pork producer and food-processing company with a Zacks Rank 1 (Strong Buy) [1] - The Zacks Consensus Estimate for its current year earnings has increased by 3% over the last 60 days [1] - The company has a price-to-earnings ratio (P/E) of 9.97, compared to the industry average of 10.80, and possesses a Value Score of A [1] Group 2: VEON - VEON is engaged in telecommunication and digital services and also carries a Zacks Rank 1 [2] - The Zacks Consensus Estimate for its next year earnings has increased by 15.2% over the last 60 days [2] - The company has a price-to-earnings ratio (P/E) of 5.21, significantly lower than the industry average of 17.60, and possesses a Value Score of A [2] Group 3: 1st Source - 1st Source is a bank holding company offering a broad range of commercial banking, personal banking, and trust services, with a Zacks Rank 1 [3] - The Zacks Consensus Estimate for its current year earnings has increased by 4.2% over the last 60 days [3] - The company has a price-to-earnings ratio (P/E) of 10.07, compared to the industry average of 11, and possesses a Value Score of B [3]