HomeStreet(US:HMST)2025-04-28 20:04Financial Performance - HomeStreet reported a core net loss of $2.9 million in Q1 2025, a 44% improvement from the $5.1 million loss in Q4 2024[2] - Net income for the quarter was a loss of $4,465 thousand, an improvement from a loss of $7,497 thousand in the prior year quarter[11] - Core net loss in Q1 2025 was $2.9 million, compared to a core net loss of $5.5 million in Q1 2024, indicating improved performance[23] - Core net loss for the quarter ended March 31, 2025, was $(4,465), compared to a net loss of $(123,327) for December 31, 2024[51] - Core net income per fully diluted share for March 31, 2025, was $(0.15), compared to $(0.27) for December 31, 2024[51] Revenue and Income - Total revenues for the quarter ended March 31, 2025, were $45,357,000, an increase from $40,310,000 in the previous quarter[52] - Net interest income increased to $33,221 thousand for the quarter ended March 31, 2025, compared to $32,151 thousand for the same period in 2024, reflecting a growth of 3.3%[11] - Noninterest income rose to $12,136 thousand, up 28.4% from $9,454 thousand in the prior year quarter[11] - Noninterest income in Q1 2025 rose due to the absence of an $88.8 million loss on the sale of multifamily loans recorded in Q4 2024[19] - Noninterest income showed a significant loss of $78,124,000 in the previous quarter, contrasting with a gain of $12,136,000 in the current quarter[52] Assets and Liabilities - Total assets decreased to $7,803,631 thousand as of March 31, 2025, down from $8,123,698 thousand at December 31, 2024, representing a decline of approximately 3.9%[10] - Loans held for investment decreased to $6,023,582 thousand, down 2.7% from $6,193,053 thousand at the end of 2024[10] - Total deposits, excluding brokered deposits, rose by $131 million during Q1 2025[3] - Total deposits as of March 31, 2025, were $6,090,495, a decrease of 5.0% from $6,413,021 on December 31, 2024[46] - The loans to deposit ratio increased to 99.9% as of March 31, 2025, compared to 97.4% at December 31, 2024[10] Credit Losses and Allowances - The provision for credit losses was $1,000 thousand, compared to no provision in the same quarter last year[11] - The allowance for credit losses (ACL) was $39,634 thousand, slightly up from $38,743 thousand at the end of 2024[10] - The provision for credit losses in Q1 2025 was $1.0 million, reflecting a $3.3 million increase in specific reserves[18] - The total allowance for credit losses across all categories was $1,000,000 for Q1 2025, reflecting a provision for credit losses of $1,000,000[38] Efficiency and Ratios - The efficiency ratio improved to 102.9% in Q1 2025 from 115.6% in Q4 2024[2] - The efficiency ratio, which measures noninterest expense to the sum of net interest income and noninterest income, was impacted by unusual items, affecting comparability with other companies[50] - The average yield on loans was 4.76% in Q1 2025, compared to 4.62% in Q4 2024[13] Deposits and Funding - Uninsured deposits accounted for $542 million, or 9% of total deposits[3] - Noninterest-bearing demand deposits increased to $1,276,133, representing 21.0% of total deposits, up from 18.6% in the previous quarter[46] - Total interest-bearing deposits decreased to $4,814,362, accounting for 79.0% of total deposits, down from 81.4% in the previous quarter[46] - Brokered deposits decreased significantly to $297,717 from $751,406 in the previous quarter, reflecting a 60.4% decline[46] Strategic Outlook - The company anticipates continuous growth in earnings due to strategic repricing of loans and effective expense management[2] - The company plans to continue focusing on core noninterest expenses and improving operational efficiency in future periods[50] - The company is in the process of merging with Mechanics Bank, which is expected to yield cost savings and synergies[54] - The company anticipates challenges in achieving expected cost savings and maintaining customer relationships due to the merger[54]