Stock Yards Bancorp(SYBT)

Search documents
Stock Yards Bancorp(SYBT) - 2025 Q2 - Quarterly Results
2025-07-23 11:30
[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) This section provides an overview of Stock Yards Bancorp's second-quarter 2025 performance, key strategic highlights, and company recognition [Second Quarter 2025 Performance Overview](index=1&type=section&id=Second%20Quarter%202025%20Performance%20Overview) Stock Yards Bancorp reported record second-quarter 2025 earnings of $34.0 million, or $1.15 per diluted share, significantly up from Q2 2024 and slightly up from Q1 2025, supported by robust loan and deposit growth Key Financial Metrics (2Q25 vs 1Q25 vs 2Q24) (Dollars in millions) | Metric | 2Q25 | 1Q25 | 2Q24 | | :--- | :--- | :--- | :--- | | Net income | $34.024 | $33.271 | $27.598 | | Net income per share, diluted | $1.15 | $1.13 | $0.94 | | Net interest income | $73.473 | $70.552 | $62.022 | | Net interest margin | 3.53% | 3.46% | 3.26% | | Annualized return on average assets | 1.52% | 1.52% | 1.35% | | Annualized return on average equity | 13.91% | 14.14% | 12.64% | - Net income increased by **23.3% year-over-year (YoY)** and **2.3% quarter-over-quarter (QoQ)**[1](index=1&type=chunk)[2](index=2&type=chunk) - Diluted EPS increased by **22.3% YoY** and **1.8% QoQ**[1](index=1&type=chunk)[2](index=2&type=chunk) [CEO Commentary and Strategic Focus](index=1&type=section&id=CEO%20Commentary%20and%20Strategic%20Focus) CEO James A. Hillebrand highlighted record earnings, robust loan growth (13% YoY), net interest margin expansion (27 bps YoY, 7 bps QoQ), and strong non-interest revenue contributions. The company successfully expanded its deposit base (14% YoY) and maintains a focus on organic growth and funding position - Total loans increased **$779 million, or 13%**, year-over-year, with **$204 million** of that growth occurring in the second quarter[2](index=2&type=chunk) - Net interest margin expanded by **27 basis points** year-over-year and **7 basis points** from the prior quarter[2](index=2&type=chunk) - Deposit base grew **$938 million, or 14%**, over the past 12 months, with non-interest bearing deposits continuing to represent over **20% of total deposits**[2](index=2&type=chunk)[3](index=3&type=chunk) [Company Profile and Recognition](index=2&type=section&id=Company%20Profile%20and%20Recognition) As of June 30, 2025, the company had $9.21 billion in assets, $6.85 billion in loans, and $7.51 billion in total deposits. It operates 73 branch offices across three states, with plans for two additional locations in 2025. The company was recognized with the 2024 Raymond James Community Bankers Cup for strong performance Key Financial Figures (as of June 30, 2025) | Metric | Amount | | :--- | :--- | | Total assets | $9.21 billion | | Total loans | $6.85 billion | | Total deposits | $7.51 billion | - The Company's combined enterprise encompasses **73 branch offices** across three contiguous states, with **two additional locations** slated to be opened in 2025 in Bardstown, Kentucky, and Liberty Township, Ohio[4](index=4&type=chunk) - Stock Yards Bancorp was named a recipient of the **2024 Raymond James Community Bankers Cup** for the **10th time**, recognizing its strong performance in profitability, operational efficiency, and balance sheet strength[5](index=5&type=chunk) [Results of Operations](index=2&type=section&id=Results%20of%20Operations) This section details the company's financial performance, comparing second-quarter 2025 results against both the prior year and prior quarter, highlighting changes in net interest income, non-interest income, expenses, and credit provisions [Second Quarter 2025 vs. Second Quarter 2024](index=2&type=section&id=Second%20Quarter%202025%20vs.%20Second%20Quarter%202024) Net interest income increased significantly due to robust loan growth and net interest margin expansion. Non-interest income saw a modest increase, while non-interest expenses rose, primarily due to compensation and marketing [Net Interest Income and Margin](index=2&type=section&id=Net%20Interest%20Income%20and%20Margin_2Q25_2Q24) Net interest income increased by 18% YoY, driven by strong earning asset growth and yield expansion, coupled with a decline in the cost of funds. Net interest margin expanded by 27 basis points to 3.53% Net Interest Income & Margin (2Q25 vs 2Q24) (Dollars in millions) | Metric | 2Q25 | 2Q24 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net interest income | $73.5 | $62.0 | $11.5 | 18% | | Net interest margin | 3.53% | 3.26% | 0.27% (bps) | - | - Total interest income increased by **$14.7 million (15%)** to **$115 million**, with interest income and fees on loans increasing **$13.0 million (14%)** and interest income on securities increasing **$936,000 (12%)**[12](index=12&type=chunk) - Total interest expense increased **$3.2 million (8%)** to **$41.5 million**, but the cost of interest-bearing liabilities decreased **10 basis points** to **2.65%**[12](index=12&type=chunk) [Provision for Credit Losses](index=2&type=section&id=Provision%20for%20Credit%20Losses_2Q25_2Q24) Provision for credit losses increased to $2.2 million in Q2 2025, primarily due to strong loan growth, a slightly deteriorating economic forecast, and increased specific reserves Provision for Credit Losses (2Q25 vs 2Q24) (Dollars in millions) | Metric | 2Q25 | 2Q24 | Change ($) | | :--- | :--- | :--- | :--- | | Provision for credit losses | $2.175 | $1.300 | $0.875 | | Provision for credit losses on loans | $2.3 | $1.1 | $1.2 | | Provision for credit losses on off balance sheet exposures | -$0.075 (credit) | $0.225 | -$0.300 | - Net charge-offs were **$342,000** in Q2 2025, compared to a recovery of **$183,000** in Q2 2024[9](index=9&type=chunk)[40](index=40&type=chunk) [Non-Interest Income](index=2&type=section&id=Non-Interest%20Income_2Q25_2Q24) Non-interest income increased by $693,000 (3%) YoY, primarily driven by swap fees, treasury management fees, and brokerage income, which offset a decline in Wealth Management & Trust (WM&T) income Non-Interest Income (2Q25 vs 2Q24) (Dollars in millions) | Metric | 2Q25 | 2Q24 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total non-interest income | $24.3 | $23.7 | $0.7 | 3% | | WM&T income | $10.5 | $10.8 | -$0.3 | -3% | | Treasury management fees | $3.0 | $2.8 | $0.2 | 6% | | Brokerage income | $0.980 | $0.800 | $0.180 | 23% | | Other non-interest income | $1.177 | $0.500 | $0.677 | 135.4% | - Other non-interest income increased **$677,000**, driven mainly by **$557,000 of swap fees**[7](index=7&type=chunk) - Brokerage income grew **$180,000 (23%)** to **$980,000**, attributed to the addition of a new broker and the benefit of portfolios shifting to more profitable wrap fee-based business[13](index=13&type=chunk) [Non-Interest Expenses](index=2&type=section&id=Non-Interest%20Expenses_2Q25_2Q24) Total non-interest expenses increased by $3.6 million (7%) YoY, mainly due to higher compensation expenses (11% increase) driven by bonus accruals and employee expansion, as well as increased marketing and business development expenses (22% increase) Non-Interest Expenses (2Q25 vs 2Q24) (Dollars in millions) | Metric | 2Q25 | 2Q24 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total non-interest expenses | $52.7 | $49.1 | $3.6 | 7% | | Compensation expense | $27.3 | $24.6 | $2.7 | 11% | | Marketing and business development | $1.951 | $1.596 | $0.355 | 22% | | Net occupancy and equipment | $4.025 | $3.819 | $0.206 | 5% | - Compensation expense increased **$2.6 million (11%)** compared to the second quarter of 2024, consistent with higher bonus accrual levels, annual merit-based increases, and full-time equivalent employee expansion[11](index=11&type=chunk) - Marketing and business development expense increased **$355,000 (22%)** due to elevated advertising tied to time deposit product promotions and increased customer entertainment and sponsorships[25](index=25&type=chunk) [Second Quarter 2025 vs. First Quarter 2025](index=4&type=section&id=Second%20Quarter%202025%20vs.%20First%20Quarter%202025) The company saw continued quarter-over-quarter growth in net interest income and non-interest income, with net interest margin expanding. Non-interest expenses also increased, and provision for credit losses rose significantly [Net Interest Income and Margin](index=4&type=section&id=Net%20Interest%20Income%20and%20Margin_2Q25_1Q25) Net interest income increased by $2.9 million (4%) QoQ, and net interest margin expanded 7 basis points to 3.53%, driven by strong loan growth and higher earning asset yields Net Interest Income & Margin (2Q25 vs 1Q25) (Dollars in millions) | Metric | 2Q25 | 1Q25 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net interest income | $73.5 | $70.6 | $2.9 | 4% | | Net interest margin | 3.53% | 3.46% | 0.07% (bps) | - | | Total interest income | $115 | $111.2 | $3.8 | 3% | | Total interest expense | $41.5 | $40.6 | $0.9 | 2% | - Interest income on loans, including fees, increased **$3.4 million (3%)** QoQ, with average loans increasing **$150 million (2%)**[33](index=33&type=chunk) - Interest expense on deposits increased **$2.9 million (8%)**, led by **$265 million (20%)** growth in average time deposit balances due to successful promotions[33](index=33&type=chunk) [Provision for Credit Losses](index=5&type=section&id=Provision%20for%20Credit%20Losses_2Q25_1Q25) Provision for credit losses on loans increased to $2.3 million in Q2 2025 from $900,000 in Q1 2025, with a $75,000 credit to expense for off-balance sheet exposures Provision for Credit Losses (2Q25 vs 1Q25) (Dollars in millions) | Metric | 2Q25 | 1Q25 | Change ($) | | :--- | :--- | :--- | :--- | | Provision for credit losses on loans | $2.3 | $0.900 | $1.4 | | Provision for credit losses on off balance sheet exposures | -$0.075 (credit) | $0 | -$0.075 | [Non-Interest Income](index=5&type=section&id=Non-Interest%20Income_2Q25_1Q25) Non-interest income increased $1.4 million (6%) QoQ, mainly from swap fees, treasury management fees, and card income, partially offset by a decline in WM&T income Non-Interest Income (2Q25 vs 1Q25) (Dollars in millions) | Metric | 2Q25 | 1Q25 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total non-interest income | $24.3 | $23.0 | $1.4 | 6% | | Other non-interest income | $1.177 | $0.540 | $0.637 | 117.9% | | Treasury management fees | $3.005 | $2.673 | $0.332 | 12% | | Debit and credit card income | $4.837 | $4.508 | $0.329 | 7% | | WM&T income | $10.483 | $10.647 | -$0.164 | -2% | - Other non-interest income increased **$637,000**, driven mainly by **$557,000 of swap fees** collected[27](index=27&type=chunk) [Non-Interest Expenses](index=5&type=section&id=Non-Interest%20Expenses_2Q25_1Q25) Non-interest expenses increased $1.7 million (3%) QoQ, primarily due to increases in compensation expense and marketing and business development expenses Non-Interest Expenses (2Q25 vs 1Q25) (Dollars in millions) | Metric | 2Q25 | 1Q25 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total non-interest expenses | $52.7 | $51.0 | $1.7 | 3% | [Financial Condition](index=4&type=section&id=Financial%20Condition) This section analyzes the company's balance sheet, asset quality, and capital adequacy as of June 30, 2025, with comparisons to prior year and prior quarter [June 30, 2025 vs. June 30, 2024](index=4&type=section&id=June%2030%2C%202025%20vs.%20June%2030%2C%202024) Total assets, loans, and deposits all experienced double-digit percentage growth year-over-year. The company maintained a "well-capitalized" status with improved capital ratios, and asset quality remained strong [Assets and Liabilities](index=4&type=section&id=Assets%20and%20Liabilities_2Q25_2Q24) Total assets increased 11% YoY to $9.21 billion, driven by a 13% increase in total loans and a 14% increase in total deposits. Investment securities decreased as cash flows were used to fund loan growth Balance Sheet Highlights (June 30, 2025 vs June 30, 2024) | Metric | June 30, 2025 | June 30, 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total assets | $9.21 billion | $8.32 billion | $0.89 billion | 11% | | Total loans | $6.85 billion | $6.07 billion | $0.78 billion | 13% | | Total deposits | $7.51 billion | $6.57 billion | $0.94 billion | 14% | | Investment securities | $1.22 billion | $1.34 billion | -$0.12 billion | -9% | - Total loans increased **$779 million (13%)** to **$6.85 billion**, with growth spread across categories and markets. Total line of credit usage ended at **48%** as of June 30, 2025, up from **41%** a year ago[16](index=16&type=chunk) - Total deposits increased **$938 million (14%)**, with the deposit mix continuing to shift from non-interest bearing and low interest-bearing deposits into higher cost deposits, led primarily by time deposit growth[18](index=18&type=chunk) [Asset Quality](index=4&type=section&id=Asset%20Quality_2Q25_2Q24) Asset quality remained strong, with non-performing loans slightly increasing but their ratio to total loans decreasing. The allowance for credit losses to loans ratio slightly declined Asset Quality Metrics (June 30, 2025 vs June 30, 2024) (Dollars in millions) | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Non-performing loans | $18.0 | $17.6 | | Non-performing loans to total loans | 0.26% | 0.29% | | Allowance for credit losses to loans | 1.32% | 1.35% | [Capital Adequacy](index=4&type=section&id=Capital%20Adequacy_2Q25_2Q24) The company maintained its "well-capitalized" regulatory rating, with all capital ratios showing meaningful growth, including total equity to assets at 10.92% and tangible common equity to tangible assets at 8.86% Capital Ratios (June 30, 2025 vs June 30, 2024) | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total equity to assets | 10.92% | 10.76% | | Tangible common equity to tangible assets | 8.86% | 8.42% | - The Company continued to be **"well-capitalized,"** the highest regulatory capital rating for financial institutions[20](index=20&type=chunk) [June 30, 2025 vs. March 31, 2025](index=5&type=section&id=June%2030%2C%202025%20vs.%20March%2031%2C%202025) The company continued to expand its balance sheet quarter-over-quarter, with total assets, loans, and deposits all showing growth [Assets and Liabilities](index=5&type=section&id=Assets%20and%20Liabilities_2Q25_1Q25) Total assets increased $212 million (2%) QoQ to $9.21 billion. Total loans expanded $204 million (3%), primarily driven by the CRE segment. Total deposits increased $213 million (3%), with growth in both non-interest-bearing and interest-bearing accounts Balance Sheet Highlights (June 30, 2025 vs March 31, 2025) | Metric | June 30, 2025 | March 31, 2025 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total assets | $9.21 billion | $9.00 billion | $0.21 billion | 2% | | Total loans | $6.85 billion | $6.65 billion | $0.20 billion | 3% | | Total deposits | $7.51 billion | $7.29 billion | $0.21 billion | 3% | - The Commercial Real Estate (CRE) segment was the primary driver of loan growth, increasing **$126 million (4%)** QoQ[30](index=30&type=chunk) - Total line of credit usage increased to **48%** as of June 30, 2025, compared to **46%** as of March 31, 2025[30](index=30&type=chunk) [Capital Management and Shareholder Returns](index=4&type=section&id=Capital%20Management%20and%20Shareholder%20Returns) This section outlines the company's capital allocation strategies, including dividend declarations and the adoption of a new share repurchase program [Dividends](index=4&type=section&id=Dividends) The board of directors declared a quarterly cash dividend of $0.31 per common share in May 2025, paid on July 1, 2025 - Quarterly cash dividend declared: **$0.31 per common share**[21](index=21&type=chunk) [Share Repurchase Program](index=4&type=section&id=Share%20Repurchase%20Program) A new share repurchase plan was adopted on July 15, 2025, authorizing the purchase of up to 1 million shares of common stock over two years, replacing the prior expired plan - New share repurchase plan adopted on July 15, 2025, authorizing the purchase of up to **1 million shares** of the Company's common stock[22](index=22&type=chunk) - The share repurchase plan expires in **two years** and replaces the Company's prior repurchase plan, which expired in May 2025[22](index=22&type=chunk) [Company Information and Forward-Looking Statements](index=5&type=section&id=Company%20Information%20and%20Forward-Looking%20Statements) This section provides an overview of Stock Yards Bancorp and includes a disclaimer regarding the inherent risks of forward-looking statements [About Stock Yards Bancorp](index=5&type=section&id=About%20Stock%20Yards%20Bancorp) Stock Yards Bancorp, Inc. is a bank holding company based in Louisville, Kentucky, with $9.21 billion in assets, operating Stock Yards Bank & Trust Company since 1904. Its shares trade on Nasdaq under "SYBT." - Louisville, Kentucky-based Stock Yards Bancorp, Inc. has **$9.21 billion in assets**[32](index=32&type=chunk) - The Company's common shares trade on The Nasdaq Stock Market under the symbol **"SYBT"**[32](index=32&type=chunk) [Forward-Looking Statements Disclaimer](index=5&type=section&id=Forward-Looking%20Statements%20Disclaimer) The report contains forward-looking statements subject to risks and uncertainties, and actual results may differ due to economic conditions, competition, regulatory changes, interest rates, and other factors detailed in SEC filings - The report contains forward-looking statements that involve risks and uncertainties, and there is no assurance they will prove to be accurate[32](index=32&type=chunk) - Factors that could cause actual results to differ include economic conditions, competition, changes in government legislation and regulation, changes in interest rates, and unforeseen changes in liquidity or financial condition of customers[32](index=32&type=chunk) - Further risks, uncertainties, and factors are detailed in the Company's Annual Report on Form 10-K and other SEC filings[34](index=34&type=chunk) [Financial Tables and Supplementary Data](index=6&type=section&id=Financial%20Tables%20and%20Supplementary%20Data) This section provides comprehensive unaudited financial tables, including income statement, balance sheet, average balance sheet, performance ratios, capital ratios, and asset quality data [Income Statement Data](index=6&type=section&id=Income%20Statement%20Data) This section presents detailed unaudited income statement figures for the three and six months ended June 30, 2025, and 2024, as well as quarterly comparisons for the past five quarters, covering net interest income, non-interest income, expenses, and net income Income Statement Data (Three Months Ended June 30, 2025 vs 2024) (Dollars in thousands) | Income Statement Data | 2025 | 2024 | | :--- | :--- | :--- | | Net interest income | $73,473 | $62,022 | | Provision for credit losses | $2,175 | $1,300 | | Total non-interest income | $24,348 | $23,655 | | Total non-interest expenses | $52,700 | $49,109 | | Net income | $34,024 | $27,598 | | Net income per share - Diluted | $1.15 | $0.94 | Income Statement Data (Quarterly Comparison) (Dollars in thousands) | Income Statement Data | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Net interest income | $73,473 | $70,552 | $69,969 | $64,979 | $62,022 | | Provision for credit losses | $2,175 | $900 | $2,675 | $4,325 | $1,300 | | Total non-interest income | $24,348 | $22,996 | $23,507 | $24,797 | $23,655 | | Total non-interest expenses | $52,700 | $51,027 | $51,657 | $48,452 | $49,109 | | Net income | $34,024 | $33,271 | $31,694 | $29,360 | $27,598 | | Net income per share - Diluted | $1.15 | $1.13 | $1.07 | $1.00 | $0.94 | [Balance Sheet Data](index=7&type=section&id=Balance%20Sheet%20Data) This section provides detailed unaudited balance sheet figures as of June 30, 2025, and 2024, along with quarterly comparisons for the past five quarters, including assets, liabilities, and stockholders' equity Balance Sheet Data (June 30, 2025 vs 2024) (Dollars in thousands) | Balance Sheet Data | 2025 | 2024 | | :--- | :--- | :--- | | Investment securities | $1,221,842 | $1,342,354 | | Loans | $6,850,273 | $6,070,963 | | Total assets | $9,208,986 | $8,315,325 | | Non-interest bearing deposits | $1,514,924 | $1,482,514 | | Interest bearing deposits | $5,991,826 | $5,086,724 | | Stockholders' equity | $1,005,704 | $894,535 | Balance Sheet Data (Quarterly Comparison) (Dollars in thousands) | Balance Sheet Data | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total assets | $9,208,986 | $8,997,478 | $8,863,419 | $8,437,280 | $8,315,325 | | Total loans | $6,850,273 | $6,646,360 | $6,520,402 | $6,278,133 | $6,070,963 | | Total deposits | $7,506,750 | $7,293,966 | $7,166,401 | $6,726,073 | $6,569,238 | | Stockholders' equity | $1,005,704 | $975,473 | $940,476 | $934,094 | $894,535 | [Average Balance Sheet Data](index=8&type=section&id=Average%20Balance%20Sheet%20Data) This section details average balance sheet figures for the three months ended June 30, 2025, and 2024, and quarterly comparisons, providing insights into average interest-earning assets, liabilities, and equity Average Balance Sheet Data (Three Months Ended June 30, 2025 vs 2024) (Dollars in thousands) | Average Balance Sheet Data | 2025 | 2024 | | :--- | :--- | :--- | | Total interest earning assets | $8,364,263 | $7,660,117 | | Total assets | $8,987,084 | $8,246,735 | | Total deposits | $7,309,502 | $6,487,512 | | Total interest bearing liabilities | $6,285,520 | $5,597,548 | | Total stockholders' equity | $980,803 | $878,233 | Average Balance Sheet Data (Quarterly Comparison) (Dollars in thousands) | Average Balance Sheet Data | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total interest earning assets | $8,364,263 | $8,270,323 | $8,099,636 | $7,783,997 | $7,660,117 | | Total assets | $8,987,084 | $8,893,907 | $8,718,416 | $8,384,605 | $8,246,735 | | Total deposits | $7,309,502 | $7,020,828 | $7,024,065 | $6,558,286 | $6,487,512 | | Total stockholders' equity | $980,803 | $954,040 | $937,782 | $910,274 | $878,233 | [Performance Ratios](index=8&type=section&id=Performance%20Ratios) This section includes key performance ratios such as annualized return on average assets, return on average equity, net interest margin, non-interest income to total revenue, and efficiency ratio for various periods Performance Ratios (Three Months Ended June 30, 2025 vs 2024) | Performance Ratios | 2025 | 2024 | | :--- | :--- | :--- | | Annualized return on average assets | 1.52% | 1.35% | | Annualized return on average equity | 13.91% | 12.64% | | Net interest margin, fully tax equivalent | 3.53% | 3.26% | | Efficiency ratio, fully tax equivalent | 53.83% | 57.26% | Performance Ratios (Quarterly Comparison) | Performance Ratios | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Annualized return on average assets | 1.52% | 1.52% | 1.45% | 1.39% | 1.35% | | Annualized return on average equity | 13.91% | 14.14% | 13.45% | 12.83% | 12.64% | | Net interest margin, fully tax equivalent | 3.53% | 3.46% | 3.44% | 3.33% | 3.26% | | Efficiency ratio, fully tax equivalent | 53.83% | 54.50% | 55.21% | 53.92% | 57.26% | [Capital Ratios](index=8&type=section&id=Capital%20Ratios) This section presents regulatory capital ratios, including total stockholders' equity to total assets, tangible common equity to tangible assets, total risk-based capital, common equity tier 1 risk-based capital, tier 1 risk-based capital, and leverage ratio Capital Ratios (June 30, 2025 vs 2024) | Capital Ratios | 2025 | 2024 | | :--- | :--- | :--- | | Total stockholders' equity to total assets | 10.92% | 10.76% | | Tangible common equity to tangible assets | 8.86% | 8.42% | | Total risk-based capital | 12.91% | 12.62% | | Common equity tier 1 risk-based capital | 11.32% | 11.07% | | Tier 1 risk-based capital | 11.66% | 11.43% | | Leverage | 10.17% | 9.95% | Capital Ratios (Quarterly Comparison) | Capital Ratios | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total stockholders' equity to total assets | 10.92% | 10.84% | 10.61% | 11.07% | 10.76% | | Tangible common equity to tangible assets | 8.86% | 8.72% | 8.44% | 8.79% | 8.42% | | Total risk-based capital | 12.91% | 12.85% | 12.73% | 12.73% | 12.62% | | Common equity tier 1 risk-based capital | 11.32% | 11.25% | 11.17% | 11.16% | 11.07% | | Tier 1 risk-based capital | 11.66% | 11.60% | 11.52% | 11.52% | 11.43% | | Leverage | 10.17% | 9.98% | 9.94% | 10.05% | 9.95% | [Loan and Deposit Segmentation](index=8&type=section&id=Loan%20and%20Deposit%20Segmentation) This section provides a breakdown of the loan portfolio by segment (e.g., commercial real estate, C&I, residential real estate) and deposit types (e.g., interest-bearing demand, savings, money market, time deposits, non-interest bearing deposits) for various periods Loan Segmentation (June 30, 2025 vs 2024) (Dollars in thousands) | Loan Segmentation | 2025 | 2024 | | :--- | :--- | :--- | | Commercial real estate - non-owner occupied | $1,989,982 | $1,652,614 | | Commercial and industrial | $1,491,143 | $1,356,970 | | Residential real estate - owner occupied | $851,284 | $749,870 | | Construction and land development | $671,011 | $586,820 | | Total loans and leases | $6,850,273 | $6,070,963 | Deposit Segmentation (June 30, 2025 vs 2024) (Dollars in thousands) | Deposit Segmentation | 2025 | 2024 | | :--- | :--- | :--- | | Interest bearing demand | $2,520,405 | $2,422,828 | | Money market | $1,385,845 | $1,177,995 | | Time deposits | $1,660,591 | $1,056,806 | | Non-Interest bearing deposits | $1,514,924 | $1,482,514 | | Total deposits | $7,506,750 | $6,569,238 | Loan Segmentation (Quarterly Comparison) (Dollars in thousands) | Loan Segmentation | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Commercial real estate - non owner occupied | $1,989,982 | $1,870,352 | $1,835,935 | $1,686,448 | $1,652,614 | | Commercial and industrial | $1,491,143 | $1,463,746 | $1,438,654 | $1,379,293 | $1,356,970 | | Total loans and leases | $6,850,273 | $6,646,360 | $6,520,402 | $6,278,133 | $6,070,963 | [Asset Quality Data](index=9&type=section&id=Asset%20Quality%20Data) This section details asset quality metrics, including non-accrual loans, total non-performing loans and assets, and ratios such as non-performing loans to total loans and allowance for credit losses to total loans Asset Quality Data (June 30, 2025 vs 2024) (Dollars in thousands) | Asset Quality Data | 2025 | 2024 | | :--- | :--- | :--- | | Non-accrual loans | $17,650 | $17,371 | | Total non-performing loans | $18,028 | $17,557 | | Non-performing loans to total loans | 0.26% | 0.29% | | Allowance for credit losses on loans to total loans | 1.32% | 1.35% | | Net (charge-offs) recoveries | $(342) | $183 | Asset Quality Data (Quarterly Comparison) (Dollars in thousands) | Asset Quality Data | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total non-performing loans | $18,028 | $16,148 | $22,214 | $17,158 | $17,557 | | Non-performing loans to total loans | 0.26% | 0.24% | 0.34% | 0.27% | 0.29% | | Allowance for credit losses on loans to total loans | 1.32% | 1.34% | 1.33% | 1.36% | 1.35% | | Net (charge-offs) recoveries | $(342) | $971 | $(625) | $(1,137) | $183 | [Provision for Credit Losses Detail](index=13&type=section&id=Provision%20for%20Credit%20Losses%20Detail) This section provides a detailed breakdown of the provision for credit losses, distinguishing between loans and off-balance sheet exposures for quarterly comparisons Provision for Credit Losses Detail (Quarterly Comparison) (Dollars in thousands) | (in thousands) | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Provision for credit losses - loans | $2,250 | $900 | $2,225 | $4,325 | $1,075 | | Provision for credit losses - off balance sheet exposures | $(75) | $0 | $450 | $0 | $225 | | Total provision for credit losses | $2,175 | $900 | $2,675 | $4,325 | $1,300 | [Non-GAAP Reconciliations](index=13&type=section&id=Non-GAAP%20Reconciliations) This section reconciles GAAP financial measures to non-GAAP measures, specifically for the efficiency ratio and tangible common equity, providing transparency on how these metrics are calculated Efficiency Ratio Reconciliation (Quarterly Comparison) (Dollars in thousands) | (Dollars in thousands) | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total non-interest expenses (a) | $52,700 | $51,027 | $51,657 | $48,452 | $49,109 | | Total revenue - Non-GAAP (b) | $97,908 | $93,632 | $93,564 | $89,861 | $85,768 | | Efficiency ratio - Non-GAAP (a/b) | 53.83% | 54.50% | 55.21% | 53.92% | 57.26% | Tangible Common Equity Reconciliation (Quarterly Comparison) (Dollars in thousands, except per share data) | (In thousands, except per share data) | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total stockholders' equity - GAAP (a) | $1,005,704 | $975,473 | $940,476 | $934,094 | $894,535 | | Tangible common equity - Non-GAAP (c) | $797,641 | $766,495 | $730,584 | $722,871 | $682,260 | | Tangible common equity to tangible assets - Non-GAAP (c/d) | 8.86% | 8.72% | 8.44% | 8.79% | 8.42% | | Tangible common equity per share - Non-GAAP (c/e) | $27.06 | $26.01 | $24.82 | $24.58 | $23.22 | [Other Information](index=13&type=section&id=Other%20Information) This section includes additional operational data such as total Wealth Management & Trust assets under management and full-time equivalent employees for quarterly periods Other Information (Quarterly Comparison) | Other Information | 6/30/25 | 3/31/25 | 12/31/24 | 9/30/24 | 6/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total WM&T assets under management (in millions) | $7,193 | $6,804 | $7,066 | $7,317 | $7,479 | | Full-time equivalent employees | 1,118 | 1,089 | 1,080 | 1,068 | 1,051 |
Stock Yards Bancorp Reports Record Second Quarter Earnings of $34.0 Million or $1.15 Per Diluted Share
Globenewswire· 2025-07-23 11:30
Core Viewpoint - Stock Yards Bancorp, Inc. reported strong financial performance for the second quarter of 2025, driven by significant loan growth and net interest margin expansion, resulting in record earnings of $34.0 million, or $1.15 per diluted share, compared to $27.6 million, or $0.94 per diluted share, in the same quarter of 2024 [1][2]. Financial Performance - Net income for Q2 2025 was $34.0 million, an increase of $6.4 million, or 23%, from Q2 2024 [2][5]. - Net interest income rose by $11.5 million, or 18%, to $73.5 million, attributed to strong growth in average earning assets and improved yields [5][10]. - Non-interest income increased by $693,000, or 3%, to $24.3 million compared to Q2 2024 [8][9]. Loan and Deposit Growth - Total loans increased by $779 million, or 13%, year-over-year, with a $204 million, or 3%, increase from the previous quarter [6][14]. - Deposit balances expanded by $938 million, or 14%, over the past 12 months, with a notable increase in interest-bearing deposits [16][28]. Net Interest Margin and Efficiency - Net interest margin expanded by 27 basis points year-over-year to 3.53%, driven by higher yields on earning assets and lower funding costs [2][10]. - The efficiency ratio improved to 53.83% from 57.26% in Q2 2024, indicating better operational efficiency [2][33]. Credit Quality - Provision for credit losses was recorded at $2.2 million, reflecting strong loan growth and a slightly deteriorating economic forecast [7][23]. - Non-performing loans totaled $18.0 million, or 0.26% of total loans, showing a slight improvement from 0.29% a year earlier [17][35]. Capital and Shareholder Returns - The company maintained a "well-capitalized" status with a tangible common equity ratio of 8.86% as of June 30, 2025 [18][29]. - A quarterly cash dividend of $0.31 per common share was declared, reflecting a commitment to returning value to shareholders [19][20]. Future Outlook - The company anticipates continued momentum in loan production and deposit growth, with expectations for net interest margin stability despite increased competition in the second half of the year [1][4].
Stock Yards Bancorp Awarded Raymond James Community Bankers Cup
Globenewswire· 2025-07-17 11:30
Core Points - Stock Yards Bancorp, Inc. has been awarded the Raymond James Community Bankers Cup for its performance in 2024, recognizing its strong operational metrics and community service commitment [1][3] - The award is given to the top 10% of community banks based on profitability, operational efficiency, and balance sheet metrics, with eligibility for banks having assets between $500 million and $10 billion as of December 31, 2024 [2] - Stock Yards Bancorp has received the Raymond James Community Bankers Cup a total of 10 times, indicating consistent high performance in the community banking sector [3] Company Overview - Stock Yards Bancorp, Inc. is based in Louisville, Kentucky, and has assets totaling $9.00 billion [4] - The company was incorporated in 1988 and serves as the parent company of Stock Yards Bank & Trust Company, which was established in 1904 [4] - The common shares of Stock Yards Bancorp trade on The NASDAQ Stock Market under the symbol "SYBT" [4]
Stock Yards Bancorp to Participate in the Stephens Investor Conference in Portland, Maine
Globenewswire· 2025-06-11 11:30
Core Viewpoint - Stock Yards Bancorp, Inc. will participate in the Stephens Investor Conference on June 16 and 17, 2025, in Portland, Maine, engaging in one-on-one meetings with institutional investors [1][2]. Company Overview - Stock Yards Bancorp, Inc. is based in Louisville, Kentucky, and has $9.00 billion in assets [2]. - The company was incorporated in 1988 as a bank holding company and is the parent of Stock Yards Bank & Trust Company, which was established in 1904 [2]. - The common shares of the company trade on The NASDAQ Stock Market under the symbol "SYBT" [2]. Conference Participation - Key executives participating in the conference include Ja Hillebrand (Chairman and CEO), Phil Poindexter (President), and T. Clay Stinnett (EVP and CFO) [1]. - Management's discussion materials for the conference will be available on the company's investor section of the website on or before June 16, 2025 [2].
Stock Yards Bancorp(SYBT) - 2025 Q1 - Quarterly Report
2025-05-06 17:03
Financial Performance - Net income for the three months ended March 31, 2025, was $33.3 million, a 29% increase from $25.9 million in the same period of 2024, resulting in diluted EPS of $1.13 compared to $0.88 [177]. - Income before income tax expense increased by $8.7 million, or 26%, from $32.96 million in 2024 to $41.62 million in 2025 [243]. - The effective tax rate increased to 21.45% for the three months ended March 31, 2025, compared to 20.06% for the same period in 2024 [243]. - Stockholders' equity increased by $35 million, or 4%, to $975 million, supported by net income of $33.3 million [247]. - The TCE ratio improved to 8.72% at March 31, 2025, compared to 8.44% at December 31, 2024, driven by net income of $33.3 million [302]. Loan and Deposit Growth - Total loans increased by $797 million, or 14%, compared to March 31, 2024, with average loans also rising by $789 million, or 14% [177]. - Deposit balances grew by $685 million, or 13%, compared to March 31, 2024, largely due to the success of promotional rate offerings [177]. - Average loan balances for the three-month periods ended March 31, 2025, and 2024 were $6.6 billion and $5.8 billion, respectively, reflecting a significant increase in loan activity [204]. - Total deposits increased by $128 million, or 2%, from December 31, 2024, to March 31, 2025 [276]. - Average interest-bearing deposits increased by $536 million, or 11%, for the three months ended March 31, 2025, with a notable 31% increase in average time deposits [192]. Interest Income and Margin - Net interest income (FTE) reached $70.6 million for the three months ended March 31, 2025, an increase of $10.5 million, or 17%, from the same period in 2024 [177]. - The net interest margin (FTE) increased by 26 basis points to 3.46% for the three months ended March 31, 2025, driven by higher rates on interest-earning assets [177]. - Total average interest-earning assets increased by $703 million, or 9%, for the three months ended March 31, 2025, with the average rate earned climbing by 32 bps to 5.46% [186]. - Net interest income increased by 3.72% and 7.64% in response to interest rate increases of 100 bps and 200 bps, respectively, while a decrease of 6.22% and 3.21% occurred with rate decreases of 200 bps and 100 bps [201]. Credit Losses and Allowance - Bancorp's allowance for credit losses (ACL) on loans increased by $8 million, or 10%, compared to March 31, 2024, attributed to significant loan growth and increased specific reserves [177]. - The allowance for credit losses (ACL) for loans increased to $89 million as of March 31, 2025, compared to $81 million in the prior year, with an ACL to total loans ratio of 1.34% [205]. - Provision for credit losses on loans was recorded at $900,000 for the three-month period ended March 31, 2025, down from $1.2 million in the same period of 2024 [206][207]. - Non-performing loans decreased to $16.1 million, or 0.24% of total loans, down from $22.2 million, or 0.34%, at the end of 2024 [260]. Non-Interest Income and Expenses - Non-interest income decreased by $275,000, or 1%, for the three months ended March 31, 2025, compared to the same period in 2024, primarily due to equity market depreciation and lower transaction volumes [182]. - Non-interest expenses increased by $2.1 million, or 4%, for the three months ended March 31, 2025, driven by higher compensation expenses and increased marketing costs [182]. - Compensation expenses increased by $1.7 million, or 7%, for the three months ended March 31, 2025, primarily due to annual merit-based salary increases [231]. Asset Management - Assets under management (AUM) totaled $6.80 billion at March 31, 2025, down from $7.50 billion at March 31, 2024, attributed to market downturns and a decline in net new business [216]. - Approximately 80% of AUM were actively managed as of March 31, 2025, compared to 79% at December 31, 2024 [220]. - Managed assets composition remained consistent with approximately 65% in equities and 35% in fixed income securities as of both March 31, 2025 and December 31, 2024 [222]. Capital and Liquidity - As of March 31, 2025, Bancorp maintained a "well-capitalized" status, with total stockholders' equity to total assets at 10.84% [182]. - Cash and cash equivalents surged by $113 million, or 39%, to $404 million, attributed to deposit growth and maturity activity [248]. - The company experienced a significant shift in deposit mix, with non-interest bearing deposits migrating to higher-yielding options, particularly time deposits [177]. Risk Management - Bancorp's interest rate risk management aims to optimize net interest income while considering capital adequacy, liquidity needs, and market opportunities [197]. - The company utilizes interest rate swaps to hedge against rising interest rates, with minimal impact on earnings due to offsetting contracts [202]. Legal and Compliance - Stock Yards Bancorp, Inc. management, including the CEO and CFO, evaluated the effectiveness of the Company's disclosure controls and procedures, concluding they were effective as of the end of the reporting period [313]. - No changes in the Company's internal control over financial reporting occurred during the fiscal quarter that materially affected its financial reporting [313]. - Bancorp and the Bank are involved in various legal proceedings typical for their business operations, but no adverse decisions are expected to materially impact their financial position [314].
Compared to Estimates, Stock Yards (SYBT) Q1 Earnings: A Look at Key Metrics
ZACKS· 2025-04-23 14:35
Core Insights - Stock Yards Bancorp (SYBT) reported revenue of $93.63 million for the quarter ended March 2025, marking a year-over-year increase of 12.2% and a surprise of +0.39% over the Zacks Consensus Estimate of $93.27 million [1] - The earnings per share (EPS) for the same period was $1.13, compared to $0.88 a year ago, resulting in an EPS surprise of +13.00% against the consensus estimate of $1.00 [1] Financial Performance Metrics - Efficiency Ratio was reported at 54.5%, better than the average estimate of 56% based on three analysts [4] - Net Interest Margin stood at 3.5%, matching the average estimate of 3.5% based on three analysts [4] - Net charge-offs to average loans were 0%, compared to the estimated 0.1% by two analysts [4] - Average Interest-Earning Assets were $8.27 billion, exceeding the estimated $8.19 billion by two analysts [4] - Total Non-Interest Income was $23 million, slightly below the estimated $23.18 million by three analysts [4] - Net Interest Income (FTE) was reported at $70.64 million, slightly above the average estimate of $70.48 million by two analysts [4] - Net Interest Income was $70.55 million, surpassing the average estimate of $69.63 million by two analysts [4] Stock Performance - Shares of Stock Yards have returned +1.9% over the past month, contrasting with the Zacks S&P 500 composite's -6.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]
Stock Yards Bancorp (SYBT) Q1 Earnings and Revenues Top Estimates
ZACKS· 2025-04-23 13:40
Stock Yards Bancorp (SYBT) came out with quarterly earnings of $1.13 per share, beating the Zacks Consensus Estimate of $1 per share. This compares to earnings of $0.88 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 13%. A quarter ago, it was expected that this holding company for Stock Yards Bank & Trust Co. Would post earnings of $0.99 per share when it actually produced earnings of $1.07, delivering a surprise of 8.08%. O ...
Stock Yards Bancorp(SYBT) - 2025 Q1 - Quarterly Results
2025-04-23 11:30
Financial Performance - Stock Yards Bancorp reported record earnings of $33.3 million, or $1.13 per diluted share, for Q1 2025, compared to $25.9 million, or $0.88 per diluted share, in Q1 2024, representing a 29% increase in net income [2][3]. - Net income for the first quarter of 2025 was $33.3 million, compared to $25.9 million in the same quarter of 2024, representing a 29% increase [32]. - Net income for Q1 2025 rose to $33,271 million, a 4.98% increase compared to $31,694 million in Q4 2024 [37]. - Basic net income per share increased to $1.13 in Q1 2025 from $1.08 in Q4 2024, representing a growth of 4.63% [37]. Loan Growth - Total loans increased by $797 million, or 14%, year-over-year, with $126 million, or 2%, growth in the linked quarter, marking the best first quarter of net loan growth adjusted for acquisition-related activity [3][7]. - Total loans expanded by $126 million, or 2%, with the Construction and Land Development segment leading growth at $56 million, or 9% [27]. - Total loans increased to $6,646,360 million in Q1 2025, compared to $6,520,402 million in Q4 2024, reflecting a growth of 1.92% [38]. Interest Income and Margin - Net interest income rose by $10.5 million, or 17%, to $70.6 million, driven by strong organic loan growth and higher interest earning asset yields [6][11]. - Net interest income for Q1 2025 was $70,552 million, an increase of 0.84% from $69,969 million in Q4 2024 [36]. - The net interest margin expanded by 26 basis points to 3.46% compared to Q1 2024, boosted by strong loan growth and a reduction in the cost of funds [3][20]. - The net interest margin, fully tax equivalent, improved to 3.46% from 3.20% year-over-year [34]. Deposits - Total deposits grew by $685 million, or 10%, over the past 12 months, with a significant shift towards higher-cost deposits [16]. - Total deposits increased by $128 million, or 2%, with non-interest-bearing demand accounts rising by $43 million, or 3% [28]. - Total deposits increased to $7,293,966 thousand, up from $7,166,401 thousand in the previous quarter, representing a growth of 1.77% [39]. Non-Interest Income - Non-interest income decreased by $275,000, or 1%, to $23.0 million compared to Q1 2024, with Wealth Management & Trust income declining by 1% due to equity market declines [9][12]. - Total non-interest income for Q1 2025 was $22,996 million, down from $23,507 million in Q4 2024, reflecting a decrease of 2.17% [36]. - Non-interest income decreased by $511,000, or 2%, to $23.0 million, while wealth management and trust services income increased by $301,000, or 3% [25]. Credit Quality - The provision for credit losses was recorded at $900,000, reflecting strong loan growth and increased specific reserves, while traditional credit quality metrics remained strong [8][17]. - Provision for credit losses recorded was $900,000, down from $2.2 million in the previous quarter [24]. - Provision for credit losses decreased to $900 million in Q1 2025 from $2,675 million in Q4 2024, indicating improved credit quality [36]. - Non-performing loans to total loans ratio improved to 0.24%, down from 0.34% in the previous quarter [39]. Assets and Capital - Total assets increased by $874 million, or 11%, year-over-year, reaching $9.00 billion as of March 31, 2025 [13]. - Total assets reached $8,997,478 thousand as of March 31, 2025, up from $8,863,419 thousand at the end of Q4 2024, marking a 1.51% increase [37]. - Tangible common equity ratio improved to 8.72% as of March 31, 2025, compared to 8.36% a year earlier, indicating strong capital position [18]. - Tangible common equity increased to $766,495 thousand, up from $730,584 thousand in the previous quarter, reflecting a stronger capital position [44]. Efficiency and Profitability - The efficiency ratio improved to 54.50% in Q1 2025 from 55.21% in Q4 2024, indicating better cost management [38]. - Efficiency ratio (Non-GAAP) improved to 54.50%, compared to 55.21% in the previous quarter [40]. - The annualized return on average assets increased to 1.52% in Q1 2025, up from 1.45% in Q4 2024, showing enhanced profitability [38]. Dividends and Shareholder Value - The board declared a quarterly cash dividend of $0.31 per common share, paid on April 1, 2025, with approximately 741,000 shares remaining eligible for repurchase under the current buy-back plan [19]. - Book value per share increased to $33.10 from $29.76 year-over-year [32]. - Book value per share rose to $33.10 in Q1 2025 from $31.96 in Q4 2024, an increase of 3.56% [37]. - Book value per share (GAAP) rose to $33.10, compared to $31.96 in the previous quarter, indicating an increase in shareholder value [44]. Workforce - Full-time equivalent employees increased to 1,089, up from 1,080 in the previous quarter, indicating growth in workforce [39].
Stock Yards Bancorp Reports Record First Quarter Earnings of $33.3 Million or $1.13 Per Diluted Share
Newsfilter· 2025-04-23 11:30
LOUISVILLE, Ky., April 23, 2025 (GLOBE NEWSWIRE) -- Stock Yards Bancorp, Inc. (NASDAQ:SYBT), parent company of Stock Yards Bank & Trust Company, with offices in Louisville, central, eastern and northern Kentucky, as well as the Indianapolis, Indiana and Cincinnati, Ohio metropolitan markets, today reported record earnings of $33.3 million, or $1.13 per diluted share, for the first quarter ended March 31, 2025. This compares to net income of $25.9 million, or $0.88 per diluted share, for the first quarter of ...
Stock Yards Bancorp(SYBT) - 2024 Q4 - Annual Report
2025-02-27 17:20
Revenue and Growth - WM&T revenue distinguishes Bancorp from other community banks of similar asset size, contributing to a strong competitive advantage[26] - Bancorp has experienced significant growth in non-interest revenue sources, particularly in treasury management services and debit/credit card services[26] - The strategy includes pursuing organic growth opportunities and opportunistically pursuing acquisitions to expand the branch network[27] - Strategic acquisition activity has expanded Bancorp's footprint into central, eastern, and northern Kentucky markets, enhancing market share in Louisville[28] Efficiency and Performance Metrics - The efficiency ratio (FTE) for the years ended December 31, 2024, 2023, and 2022 was 56.20%, 55.23%, and 59.30%, respectively, with the elevated ratio in 2022 attributed to merger-related expenses[30] - Bancorp's adjusted efficiency ratio (FTE) for the years ended December 31, 2024, 2023, and 2022 was 56.18%, 54.84%, and 53.61%[31] - The company emphasizes cost management and operational efficiency to enhance earnings and customer experience[29] Capital and Asset Quality - The bank is categorized as well-capitalized, meeting the minimum capital ratios required for prompt corrective action[51] - As of December 31, 2024, Bancorp exceeded the capital requirements to be considered well-capitalized, maintaining a Common Equity Tier 1 Risk-Based Capital ratio above the 7.0% minimum[53] - Bancorp's asset quality metrics have remained strong, but there is an expectation that these metrics may normalize over time due to cyclical lending business trends[76] - The allowance for credit losses (ACL) reflects management's estimates of expected credit losses, which may require adjustments based on economic conditions and borrower performance[74] Economic and Market Conditions - The Federal Reserve increased the Federal Funds Target Rate (FFTR) by a total of 525 basis points in 2022 and 2023, reaching a range of 5.25% - 5.50% by July 2023, before reducing it to 4.25% - 4.50% by December 31, 2024[67][68] - The net interest margin (NIM) experienced compression due to increased deposit costs and a shift in deposit mix, which continued into 2024 alongside substantial loan growth[70] - The economic outlook for 2025 remains uncertain, influenced by potential policy changes, inflation control efforts, and geopolitical risks[73] Regulatory and Compliance Issues - Bancorp is committed to monitoring regulatory developments related to cybersecurity and information technology, which are expected to remain a focus for federal and state regulators[60] - The bank failures in early 2023 raised questions about the soundness of the banking system, although Bancorp remained well-capitalized and managed liquidity fluctuations effectively[91] - The company is subject to extensive regulation and any changes could significantly impact its financial condition and results of operations[127] - Bancorp has incurred costs related to preparing for heightened regulatory requirements, which may adversely affect its financial condition[129] Risks and Challenges - The company faces significant competition from both traditional and non-traditional financial institutions, which could adversely affect profitability[102] - Acquisitions may introduce asset quality issues or contingent liabilities that were not identified during due diligence, potentially leading to unanticipated losses[99] - The risk management framework established by the company is crucial for identifying and managing risk exposure, and any failure in this framework could have a material adverse effect[114] - Cybersecurity risks, including potential breaches, could negatively impact Bancorp's business and financial condition[121] - Fraud remains a significant operational risk, with evolving methods potentially leading to financial losses and reputational damage[122] - Changes in tax laws and regulations could materially affect Bancorp's financial condition and results of operations[130] - Increasing scrutiny regarding ESG practices may impose additional costs and risks on Bancorp[135] Asset Management and Intangible Assets - Approximately 45% of non-interest income is derived from Wealth Management & Trust (WM&T), which is sensitive to market fluctuations affecting assets under management (AUM)[82] - Bancorp's goodwill stood at $194 million as of December 31, 2024, and any impairment could negatively impact financial results[85] - Bancorp had intangible assets totaling $16 million as of December 31, 2024[87] - Deferred tax assets (DTAs) amounted to $72 million at December 31, 2024, with management concluding that it is more likely than not that all DTAs will be realized[88] Technological and Market Trends - The financial services industry is experiencing rapid technological changes, and Bancorp's ability to compete depends on effectively implementing new technology-driven products and services[125] - The evolution of non-bank alternatives for financial transactions poses a risk of losing revenue sources, including fee income and deposits[126] - Fluctuations in common stock price may affect the ability to resell shares at acceptable prices, influenced by various market factors[136] Employee and Workplace Recognition - As of December 31, 2024, Bancorp had 1,080 full-time equivalent employees, with approximately 68% located in Louisville, Kentucky[34] - Bancorp was recognized as one of the "Best Banks to Work For" by American Banker for the fourth consecutive year in November 2024[35]