Landmark Bancorp(LARK) - 2025 Q1 - Quarterly Report

PART I – FINANCIAL INFORMATION This section presents the unaudited consolidated financial information, including statements and management's analysis Financial Statements This section presents the unaudited consolidated financial statements for Q1 2025, showing increased net earnings driven by higher net interest income Consolidated Balance Sheets Total assets and net loans increased slightly, while stockholders' equity grew due to net earnings and comprehensive income Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $1,578,589 | $1,574,142 | | Loans, net | $1,061,696 | $1,039,221 | | Investment securities available-for-sale | $355,992 | $372,512 | | Total Liabilities | $1,435,938 | $1,437,927 | | Total deposits | $1,335,822 | $1,328,766 | | Total Stockholders' Equity | $142,651 | $136,215 | Consolidated Statements of Earnings Net earnings significantly increased to $4.7 million in Q1 2025, driven by higher net interest income and no provision for credit losses Q1 Earnings Comparison (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Interest Income | $13,119 | $10,747 | | Provision for credit losses | $0 | $300 | | Net Earnings | $4,701 | $2,778 | | Diluted Earnings Per Share | $0.81 | $0.48 | | Dividends Per Share | $0.21 | $0.20 | Consolidated Statements of Cash Flows Cash and cash equivalents increased by $1.6 million, with net cash provided by operating activities offsetting investing and financing uses Cash Flow Summary for Three Months Ended March 31 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $8,018 | $2,851 | | Net cash used in investing activities | ($424) | ($2,670) | | Net cash used in financing activities | ($5,988) | ($10,814) | | Net increase (decrease) in cash | $1,606 | ($10,633) | Notes to Consolidated Financial Statements Detailed disclosures cover investment securities, loan portfolio, regulatory capital, and other key financial statement components - As of March 31, 2025, the investment portfolio included $356.0 million in available-for-sale securities and $3.7 million in held-to-maturity securities, with most unrealized losses deemed temporary[27][28] - Gross loans increased to $1.075 billion at March 31, 2025, from $1.052 billion at year-end 2024, with the allowance for credit losses stable at $12.8 million and non-accrual loans at 1.24% of gross loans[34][37] - The Company and the Bank met all regulatory capital requirements as of March 31, 2025, with the Bank categorized as 'well capitalized'[81][85][89] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2025 financial results, highlighting increased net earnings, expanded net interest margin, strong asset quality, and robust liquidity Key Performance Ratios (Annualized) | Ratio | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Return on average assets | 1.21% | 0.72% | | Return on average equity | 13.71% | 8.88% | | Net interest margin (tax-equivalent) | 3.76% | 3.12% | - Net interest income increased by $2.4 million (22.1%) year-over-year, driven by higher loan interest income and lower total interest expense[101][102][103] - Asset quality remained strong, with the allowance for credit losses at $12.8 million (1.19% of gross loans) and non-accrual loans stable at 1.24%[114][116] - Liquidity is strong, with $381.8 million in liquid assets and $203.2 million in FHLB borrowing capacity as of March 31, 2025[125][126] Quantitative and Qualitative Disclosures about Market Risk The company's primary market risk is interest rate risk, with simulations showing liability sensitivity to rising rates Net Interest Income Sensitivity Analysis (as of March 31, 2025) | Scenario | Percent Change in Net Interest Income | | :--- | :--- | | +300 basis points | (9.5)% | | +200 basis points | (6.7)% | | +100 basis points | (3.9)% | | -100 basis points | (0.3)% | - The company's operations largely depend on net interest income and its ability to manage interest rate risk from asset and liability repricing mismatches[133] Controls and Procedures Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during Q1 2025 - The CEO and CFO concluded that the Company's disclosure controls and procedures were effective as of March 31, 2025[139] - No material changes in internal control over financial reporting occurred during the quarter[140] PART II – OTHER INFORMATION This section provides additional information on legal proceedings, risk factors, equity sales, and other disclosures Legal Proceedings The company reports no material pending legal proceedings beyond ordinary routine litigation incidental to its business - There are no material pending legal proceedings against the Company or its subsidiaries, other than ordinary routine litigation[142] Risk Factors No material changes have occurred in the risk factors previously disclosed in the Company's 2024 Annual Report on Form 10-K - No material changes have occurred in the risk factors from those disclosed in the Company's 2024 Form 10-K[143] Unregistered Sales of Equity Securities and Use of Proceeds The company did not repurchase any equity securities in Q1 2025, with 157,456 shares remaining available for repurchase Share Repurchase Activity (Q1 2025) | Period | Total Shares Purchased | Average Price Paid | | :--- | :--- | :--- | | Jan 2025 | 0 | $ - | | Feb 2025 | 0 | $ - | | Mar 2025 | 0 | $ - | | Total | 0 | $ - | - As of March 31, 2025, 157,456 shares were still available for repurchase under the March 2020 Repurchase Program[144] Other Information No directors or executive officers adopted or terminated Rule 10b5-1 trading plans during the first quarter of 2025 - No directors or executive officers adopted or terminated any Rule 10b5-1 trading plans during the quarter ended March 31, 2025[147] Exhibits This section lists the exhibits filed with the Form 10-Q, including required certifications and interactive data files - The report includes required certifications from the Chief Executive Officer and Chief Financial Officer pursuant to Sarbanes-Oxley Act rules[148] - Interactive data files (Inline XBRL) are included as Exhibit 101, as required by SEC regulations[148]