Financial Performance - Net interest income for Q1 2024 was $356,458,000, a decrease of 2.6% from $364,408,000 in Q4 2023[155] - Noninterest income decreased to $77,522,000 in Q1 2024 from $100,094,000 in Q4 2023, reflecting a decline of 22.5%[155] - Net income available to common shareholders was $116,250,000 in Q1 2024, down from $128,446,000 in Q4 2023, a decrease of 9.1%[155] - Net income applicable to common shares for Q1 2024 was $116.3 million, or $0.40 per diluted common share, down from $128.4 million, or $0.44 per diluted common share in Q4 2023[166] - Adjusted net income for Q1 2024 was $130.8 million, or $0.45 per diluted common share, compared to $134.6 million, or $0.46 per diluted common share in Q4 2023[167] Credit Losses and Provisions - Provision for credit losses increased to $18,891,000 in Q1 2024 from $11,595,000 in Q4 2023, indicating a rise in expected credit losses[155] - Provision for credit losses rose by $7.3 million to $18.9 million, reflecting net charge-offs and loan growth[169] - Total provision for credit losses increased by 40.6% to $18.891 million for the three months ended March 31, 2024, from $13.437 million in the same period in 2023[188] - The allowance for credit losses on loans was $319.7 million at March 31, 2024, compared to $307.6 million at December 31, 2023, indicating a potential increase in provision expense due to loan growth and changes in credit quality[230] Loans and Deposits - Total loans increased to $33,623,319,000 in Q1 2024, up from $32,991,927,000 in Q4 2023, representing a growth of 1.9%[155] - Total deposits rose to $37,699,418,000 in Q1 2024, compared to $37,235,180,000 in Q4 2023, an increase of 1.2%[155] - Loan balances increased by $631.4 million to $33.6 billion, driven by disciplined commercial and commercial real estate loan growth[168] - Total deposits increased by $464.2 million to $37.7 billion, reflecting efforts to attract new client relationships[168] Efficiency and Ratios - The efficiency ratio was 58.34% in Q1 2024, slightly improved from 59.05% in Q4 2023[155] - The return on average assets decreased to 0.98% in Q1 2024 from 1.09% in Q4 2023[155] - The Tier 1 common equity ratio improved to 10.76% in Q1 2024 from 10.70% in Q4 2023[155] - The efficiency ratio increased to 58.34% from 52.81% year-over-year, indicating a decline in operational efficiency[173] Assets and Investments - Assets increased by $445.1 million to $49.5 billion at March 31, 2024, compared to $49.1 billion at December 31, 2023[194] - Earning assets grew by $534.2 million to $44.5 billion at March 31, 2024, compared to $43.9 billion at December 31, 2023[195] - The investment securities portfolio, including equity securities, was $10.2 billion, representing 23% of earning assets at both March 31, 2024, and December 31, 2023[197] Tax and Regulatory Compliance - The effective tax rate was 21.3% for the three months ended March 31, 2024, down from 22.0% for the same period in 2023[193] - The company exceeded regulatory capital requirements, with a Tier 1 capital ratio of 8.96% as of March 31, 2024, compared to 8.83% at the end of 2023[215] Risk Management - The company's stress testing process incorporates key risks including strategic, market, liquidity, credit, operational, regulatory, compliance, legal, and reputational risks[217] - Old National's interest rate risk management aims to maximize net interest income while maintaining adequate levels of funding and liquidity[234] Future Projections - Projected net interest income for March 31, 2024, is $6,360,479 thousand, an increase from $5,504,768 thousand in the previous year, reflecting growth due to loan growth and rising interest rates[239] - Total interest income is expected to rise from $3,155,024 thousand in March 31, 2023, to $6,360,479 thousand in March 31, 2024, indicating a year-over-year increase of approximately 102%[239] - Projected interest expense is anticipated to increase from $680,872 thousand in March 31, 2023, to $3,243,938 thousand in March 31, 2024, representing a significant rise of about 376%[239]
OLD NATIONAL BAN(ONBPO) - 2024 Q1 - Quarterly Report