First Financial Bankshares(FFIN) - 2025 Q1 - Quarterly Report

Financial Performance - Net earnings for Q1 2025 were $61,346 thousand, compared to $53,397 thousand in 2024, reflecting a growth of 14.8%[15] - Net interest income for the three months ended March 31, 2025, was $118,789 thousand, a 18.5% increase from $100,242 thousand in the same period of 2024[15] - Comprehensive earnings for Q1 2025 were $96,746 thousand, a substantial increase from $15,468 thousand in Q1 2024[17] - Net earnings for the three months ended March 31, 2025, were $61,346 thousand, an increase of 14.5% compared to $53,397 thousand for the same period in 2024[22] - The company reported a net increase in interest-bearing deposits of $359,085 thousand, compared to an increase of $238,947 thousand in the prior year[22] - The company declared cash dividends of $0.18 per share, totaling $25,754 thousand, consistent with the previous year's dividend[22] - The company repurchased and retired 101,337 shares at an average price of $26.99 per share under the previous stock repurchase authorization[29] - The company reported a total of $1 million in year-to-date gross charge-offs for non-auto loans, reflecting stable performance[104] Asset and Deposit Growth - Total assets increased to $14,312,114 thousand as of March 31, 2025, up from $13,191,158 thousand in 2024, representing an increase of 8.5%[13] - Total deposits rose to $12,466,771 thousand as of March 31, 2025, compared to $11,289,808 thousand in 2024, marking an increase of 10.5%[13] - Cash and cash equivalents at the end of the period reached $927,055 thousand, compared to $600,161 thousand at the end of the previous year[22] - Total loans held-for-investment as of March 31, 2025, were $7.95 billion, an increase of $32.51 million from December 31, 2024, and up $747.52 million year-over-year[187] Loan Portfolio and Credit Quality - The loan portfolio totaled $7,945,611,000 as of March 31, 2025, an increase from $7,229,410,000 in the same period of 2024[80] - Nonaccrual loans increased to $60,430,000 as of March 31, 2025, compared to $36,157,000 in 2024[82] - The allowance for credit losses was $101,080,000 as of March 31, 2025, up from $89,562,000 in 2024[80] - The total provision for loan losses for the three months ended March 31, 2025, was $2,991,000, combined with a provision for unfunded commitments of $537,000, totaling $3,528,000 reported under credit losses[85] - The total past due loans increased from $45,514,000 on March 31, 2024, to $63,829,000 on March 31, 2025, representing a significant increase of approximately 40%[105] Noninterest Income and Expenses - Noninterest income totaled $30,230 thousand for the three months ended March 31, 2025, up from $29,383 thousand in 2024, a growth of 2.9%[15] - Total noninterest expense for Q1 2025 was $70.34 million, compared to $63.94 million in the same period of 2024, with salaries and employee benefits increasing to $42.14 million[184] - The efficiency ratio improved to 46.36% in Q1 2025 from 48.37% in Q1 2024, indicating better management of noninterest expenses[182] Regulatory and Accounting Changes - ASU 2023-07 will require public entities to disclose significant expenses and segment items on an annual and interim basis starting in 2024, with no significant impact on financial statements expected[31] - ASU 2023-09 mandates more detailed income tax disclosures for public business entities, effective for annual reporting periods beginning after December 15, 2024, with no significant impact on financial statements anticipated[32] Stock and Shareholder Information - The company had 1,242,910 shares remaining for issuance under the 2021 Omnibus Stock and Incentive Plan as of March 31, 2025[125] - The outstanding stock options as of March 31, 2025, totaled 1,533,435 with a weighted average exercise price of $32.26[136] - The total fair value of shares vested during the three months ended March 31, 2025, was $26,000, compared to $46,000 for the same period in 2024, indicating a decrease of 43.5%[139] Tax and Interest Rates - The Company recorded an income tax expense of $13,810,000 for Q1 2025, compared to $11,480,000 for Q1 2024, with effective tax rates of 18.38% and 17.70% respectively[121] - The weighted average interest rate on borrowings was 3.06% for the first quarter of 2025, down from 4.36% in the same period of 2024[209] Market and Economic Conditions - The Federal Reserve's interest rate adjustments included a decrease of 50 basis points in September 2024, impacting the target rate range to 4.25% to 4.50% as of March 31, 2025[177] - The company has enhanced stress testing and loan review activities to mitigate interest rate reset risk due to the current interest rate environment[192]