ConnectOne Bancorp(US:CNOB)2025-05-02 20:02Financial Performance - Net income available to common stockholders for Q1 2025 was $18.7 million, up from $15.7 million in Q1 2024, representing a 19.1% increase[174]. - Diluted earnings per share increased to $0.49 in Q1 2025 from $0.41 in Q1 2024, reflecting an increase of 19.5%[174]. - Noninterest income rose to $4.5 million in Q1 2025, compared to $3.8 million in Q1 2024, marking an 18.4% increase[184]. - Noninterest expenses totaled $39.3 million in Q1 2025, up from $37.1 million in Q1 2024, reflecting a 5.9% increase[185]. - Income tax expense increased to $7.2 million in Q1 2025 from $5.9 million in Q1 2024, resulting in an effective tax rate of 26.1%[186]. Interest Income and Margin - Fully taxable equivalent net interest income for Q1 2025 was $66.6 million, a 9.0% increase from $61.1 million in Q1 2024[176]. - The net interest margin improved to 2.93% in Q1 2025, up from 2.64% in Q1 2024, indicating a 29 basis-point increase[176]. Loan Portfolio - Gross loans decreased by $74.1 million, or 0.9%, to $8.2 billion as of March 31, 2025, compared to December 31, 2024[188]. - The loan portfolio composition as of March 31, 2025 included 71.1% in commercial real estate loans[188]. - As of March 31, 2025, the total commercial real estate loans amounted to $5,837.7 million, a slight decrease from $5,880.7 million as of December 31, 2024, with a loan-to-value ratio of 53%[190]. - Average loans receivable for the three months ended March 31, 2025, were $8,208.8 million, down from $8,332.7 million for the same period in 2024[201]. Credit Quality - The allowance for credit losses for loans was $82.4 million as of March 31, 2025, down from $82.7 million as of December 31, 2024[195]. - The provision for credit losses for the three months ended March 31, 2025, was $3.5 million, compared to $4.0 million for the same period in 2024[196]. - Net charge-offs for the three months ended March 31, 2025, were $3.4 million, representing 0.17% of average loans receivable, compared to $3.2 million or 0.15% for the same period in 2024[197]. - Nonaccrual loans decreased to $49.9 million as of March 31, 2025, from $57.3 million as of December 31, 2024, with nonaccrual loans to total loans receivable at 0.61%[205]. Securities and Investments - The average securities portfolio increased by $25.6 million to $745.9 million, representing 8.1% of average total interest-earning assets for the three months ended March 31, 2025[206]. - Net unrealized losses on securities available-for-sale decreased to $64.2 million as of March 31, 2025, from $69.6 million as of December 31, 2024[207]. Liquidity and Deposits - Liquid assets as of March 31, 2025, totaled $574.7 million, representing 5.9% of total assets, down from $799.7 million or 8.1% of total assets as of December 31, 2024[223]. - Average total deposits increased by $156.5 million, or 2.1%, during the three months ended March 31, 2025, compared to the same period in 2024[230]. - Total deposits decreased by $52.9 million, or 0.7%, from December 31, 2024, primarily due to a $102.8 million decrease in noninterest-bearing demand deposits[237]. - Estimated uninsured deposits increased to $6,999,118 thousand as of March 31, 2025, compared to $6,883,241 thousand as of December 31, 2024[236]. Capital and Equity - The Company’s stockholders' equity increased by $11.2 million to $1,252,939 thousand as of March 31, 2025, driven by an increase in retained earnings[244]. - The tangible common equity ratio improved to 9.73% as of March 31, 2025, up from 9.49% as of December 31, 2024[246]. - Total risk-based capital ratio for the Company was 14.29% as of March 31, 2025, exceeding the minimum requirement of 8.00%[250]. Interest Rate Risk Management - The Bank's interest rate risk management strategies include diversifying the mix of interest-earning assets and liabilities and utilizing interest rate swap agreements[209]. - As of March 31, 2025, a 200 basis-point increase in interest rates is estimated to decrease net interest income by 5.30%, while a 100 basis-point decrease would increase net interest income by 2.27%[212]. - The estimated economic value of equity (EVE) would decrease by 5.11% with a 200 basis-point increase in interest rates as of March 31, 2025[214].