Heritage merce p(US:HTBK)2025-04-24 20:34Financial Performance - Net income for Q1 2025 was $11.6 million, representing a 9% increase from $10.6 million in Q4 2024 and a 14% increase from $10.2 million in Q1 2024[4] - Earnings per share for Q1 2025 was $0.19, up 12% from $0.17 in both Q4 2024 and Q1 2024[4] - Total revenue for Q1 2025 was $46.1 million, a decrease of 1% from $46.4 million in Q4 2024, but an increase of 9% from $42.1 million in Q1 2024[8] - Income before income taxes rose by 11% to $16,326,000 compared to Q4 2024 and by 13% compared to Q1 2024[41] - Net income for Q1 2025 was $11,626,000, reflecting a 9% increase from Q4 2024 and a 14% increase from Q1 2024[41] - Basic and diluted earnings per share both increased by 12% to $0.19 compared to Q4 2024[41] - Annualized return on average equity increased to 6.81%, up 11% from Q4 2024[41] - Net income for the quarter ended March 31, 2025, was $11,626,000, an increase from $10,166,000 in the same quarter of 2024, marking a growth of 14.3%[54] Revenue and Income Sources - Interest income for Q1 2025 was $61,832,000, a decrease of 3% from Q4 2024 and an increase of 9% from Q1 2024[41] - Net interest income after provision for credit losses increased by 2% to $43,086,000 compared to Q4 2024 and by 10% compared to Q1 2024[41] - Total noninterest income decreased by 3% to $2,696,000 from Q4 2024, but increased by 2% from Q1 2024[41] - Total noninterest income for the quarter ended March 31, 2025, was $2,696,000, compared to $2,638,000 in the same quarter of 2024, reflecting a growth of 2.2%[55] Asset and Liability Management - Total deposits decreased by $136.8 million, or 3%, to $4.7 billion in Q1 2025 compared to Q4 2024, but increased by $238.6 million, or 5%, from $4.4 billion in Q1 2024[22] - Loans held-for-investment (HFI) remained flat at $3.5 billion compared to Q4 2024, but increased by $150.8 million, or 5%, from $3.3 billion in Q1 2024[20] - Total available liquidity and borrowing capacity was $3.2 billion at March 31, 2025, down from $3.3 billion at December 31, 2024[24] - Total assets decreased by 2% to $5,514,255,000 compared to $5,645,006,000 in the previous quarter[44] - Total liabilities decreased by 3% to $4,818,065,000 from $4,955,279,000 in the previous quarter[45] Credit Quality and Losses - The provision for credit losses on loans was $274,000 in Q1 2025, significantly lower than $1.3 million in Q4 2024[7] - Net charge-offs totaled $965,000 for the first quarter of 2025, significantly higher than $197,000 in the fourth quarter of 2024[29] - Nonperforming assets (NPAs) decreased to $6.3 million at March 31, 2025, from $7.7 million at December 31, 2024[31] - The allowance for credit losses on loans was $48.3 million, or 1.38% of total loans, at March 31, 2025, representing 765% of total nonperforming loans[30] Efficiency and Management Ratios - The efficiency ratio improved to 63.96% in Q1 2025 from 65.35% in Q4 2024, indicating better expense management[13] - The FTE net interest margin for Q1 2025 was 3.39%, an increase from 3.32% in Q4 2024 and 3.31% in Q1 2024[6] - Annualized return on average tangible common equity improved to 9.09% for the quarter ended March 31, 2025, compared to 8.24% a year earlier[54] Shareholder Equity and Capital - Total shareholders' equity increased by $6.5 million to $696 million in Q1 2025 compared to Q4 2024[4] - Total shareholders' equity rose to $696.2 million at March 31, 2025, from $689.7 million at December 31, 2024, primarily due to net income[25] - Tangible common equity increased to $522,573,000, a 1% increase from $515,657,000 in the previous quarter[46] - Total Common Equity (GAAP) increased to $696,190,000 as of March 31, 2025, up from $676,296,000 on March 31, 2024, reflecting a growth of approximately 2.5%[56] Deposits Composition - Total deposits as of March 31, 2025, were composed of 24% demand, noninterest-bearing; 20% demand, interest-bearing; 29% savings and money market; and 21% ICS/CDARS[23] - The loan to deposit ratio increased to 74.45% at March 31, 2025, compared to 72.45% at December 31, 2024[23] - Average deposits decreased by 1% to $4,717,517,000 compared to Q4 2024[41]