Bridgewater Bank(US:BWB)2025-05-01 11:05Acquisition and Merger - The Company completed the acquisition of FMCB on December 13, 2024, adding approximately $245.0 million in assets and $225.7 million in deposits[134]. - The acquisition also included $117.1 million in loans and leases and two branch locations in Minnetonka, Minnesota[134]. - During Q1 2025, the Company incurred merger-related expenses of $565,000 related to the FMCB acquisition[134]. Financial Performance - Net income for Q1 2025 was $9.6 million, an increase from $7.8 million in Q1 2024, representing a 23.1% year-over-year growth[139]. - Diluted earnings per share for Q1 2025 were $0.31, compared to $0.24 in Q1 2024, reflecting a 29.2% increase[139]. - Adjusted net income for Q1 2025 was $10.1 million, compared to $7.8 million in Q1 2024, reflecting a 29.5% increase[139]. - Noninterest income for Q1 2025 was $2.1 million, compared to $1.5 million in Q1 2024, showing a 38.5% increase[136]. - The efficiency ratio improved to 55.5% in Q1 2025 from 56.8% in Q4 2024, indicating better cost management[136]. Income and Expenses - Net interest income for Q1 2025 was $30.2 million, up from $25.6 million in Q1 2024, indicating a 17.9% increase[136]. - Total interest income for Q1 2025 was $66.0 million, an increase of $6.9 million or 11.7% compared to $59.0 million in Q1 2024[152]. - Noninterest expense increased to $18.1 million in Q1 2025, up $2.9 million or 19.1% from $15.2 million in Q1 2024, primarily due to higher salaries and merger-related expenses[165]. Assets and Loans - Total assets as of March 31, 2025, were $5.1 billion, up from $4.7 billion as of March 31, 2024, marking a 9.5% increase[136]. - Total loans, gross, reached $4.0 billion as of March 31, 2025, compared to $3.7 billion a year earlier, representing an 8.9% increase[136]. - The loan to deposit ratio was 96.6% as of March 31, 2025, compared to 94.7% as of December 31, 2024[136]. - Nonperforming loans increased to $10.3 million, or 0.26% of total loans, as of March 31, 2025, compared to $8.4 million, or 0.23%, a year earlier[137]. Credit Losses and Allowances - The provision for credit losses on loans and leases was $1.5 million for Q1 2025, compared to $850,000 in Q1 2024, reflecting increased growth in the loan portfolio[159]. - The allowance for credit losses on loans and leases to total loans was 1.34% at March 31, 2025, down from 1.36% at March 31, 2024[159]. - The allowance for credit losses was $53,766 thousand as of March 31, 2025, compared to $52,277 thousand at the end of 2024, indicating a slight increase in provisions[186]. Deposits and Funding - Total deposits reached $4.16 billion as of March 31, 2025, marking an increase of $75.7 million, or 1.9%, from $4.09 billion at December 31, 2024, and a 9.3% increase from $3.81 billion at March 31, 2024[200]. - Core deposits increased by $63.7 million, or 8.3% annualized, from December 31, 2024, driven by both existing client balances and new client acquisitions[200]. - Brokered deposits totaled $831.5 million as of March 31, 2025, a slight increase of $5.7 million from $825.8 million at December 31, 2024, serving as a supplemental funding source for loan portfolio growth[202]. Liquidity and Capital - Total shareholders' equity increased by $11.0 million, or 2.4%, to $469.0 million as of March 31, 2025, compared to $457.9 million at December 31, 2024[209]. - The Company maintained a total risk-based capital ratio of 13.62% as of March 31, 2025, exceeding the minimum required ratio of 8.00%[214]. - Total on- and off-balance sheet liquidity was $2.36 billion as of March 31, 2025, compared to $2.30 billion at December 31, 2024[220]. Interest Rate Risk Management - The Company faces risks related to interest rate fluctuations, credit risk, and competition from nonbank financial service providers[130]. - The Company’s risk management infrastructure includes limits and management targets for various metrics related to interest rate risk[230]. - Interest rate risk is managed by adjusting interest rates and terms associated with investment securities and customer deposits[231].