RBB(RBB) - 2025 Q2 - Quarterly Results

Executive Summary & Highlights Second Quarter 2025 Highlights RBB Bancorp reported strong financial results for Q2 2025, driven by significant net income growth, improved profitability ratios, and robust loan growth, benefiting from a substantial Employee Retention Credit (ERC) income partially offset by associated professional costs, while nonperforming assets decreased and book values per share increased Key Financial Metrics (Dollars in millions) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | | :-------------------------------- | :------ | :------ | :----------- | | Net Income | $9.3 million | $2.3 million | +$7.0 million | | Diluted EPS | $0.52 | $0.13 | +$0.39 | | Return on Average Assets (ROAA) | 0.93% | 0.24% | +0.69 pp | | Net Interest Margin (NIM) | 2.92% | 2.88% | +0.04 pp | | Net Loans HFI Growth (annualized) | $91.6 million | - | 12% | | Nonperforming Assets | $61.0 million | $64.6 million | -$3.6 million (-5.5%) | | Book Value Per Share | $29.25 | $28.77 | +$0.48 | | Tangible Book Value Per Share | $25.11 | $24.63 | +$0.48 | - Net income for Q2 2025 included a pre-tax income of $5.2 million from an Employee Retention Credit (ERC), partially offset by $1.2 million (pre-tax) in professional and advisory costs related to the ERC[3][4] - The CEO highlighted strong loan growth and stable loan yields as drivers for increasing net interest income and margin expansion, alongside the benefit from the ERC receipt, with the company remaining focused on resolving nonperforming loans[4] Financial Performance Analysis Net Interest Income and Net Interest Margin Net interest income increased quarter-over-quarter, primarily due to higher interest income from loans, despite an increase in interest expense, with the net interest margin expanding, driven by an increase in the yield on interest-earning assets and a decrease in the overall cost of funds, particularly from interest-bearing deposits Key Net Interest Metrics (Dollars in millions) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | | :-------------------------------- | :------ | :------ | :----------- | | Net Interest Income | $27.3 million | $26.2 million | +$1.2 million | | Net Interest Margin (NIM) | 2.92% | 2.88% | +4 bps | | Yield on Average Interest-Earning Assets | 5.79% | 5.76% | +3 bps | | Overall Cost of Funds | 3.14% | 3.15% | -1 bp | | Yield on Average Loans | 6.03% | 6.01% | +2 bps | | Average Cost of Interest-Bearing Deposits | 3.66% | 3.77% | -11 bps | | Average Cost of Total Borrowings | - | - | +75 bps | | Average Loans as % of Avg. Interest-Earning Assets | 85% | 84% | +1 pp | - The increase in interest income was mostly due to a $2.1 million increase in interest and fees on loans, while the increase in interest expense was due to a $433,000 increase in interest on borrowings and a $265,000 increase in interest on deposits[6] - The average cost of borrowings increased as $150 million in long-term FHLB advances matured in Q1 2025 and were largely replaced and repriced at current market rates[8] Provision for Credit Losses The provision for credit losses significantly decreased quarter-over-quarter, reflecting an increase in general reserves due to net loan growth and a specific reserve for one lending relationship, while net charge-offs increased Provision for Credit Losses (Dollars in millions) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | | :-------------------------------- | :------ | :------ | :----------- | | Provision for Credit Losses | $2.4 million | $6.7 million | -$4.3 million | | Net Charge-offs | $3.3 million | - | - | | Net Charge-offs (annualized % of avg. loans) | 0.42% | 0.35% | +0.07 pp | - The Q2 2025 provision included a $1.5 million increase in general reserves due to net loan growth and a $924,000 increase in a specific reserve for one lending relationship[9] Noninterest Income Noninterest income saw a substantial increase, primarily driven by the receipt of Employee Retention Credit (ERC) funds, with the quarter also including higher gains from loan sales and recoveries from a previously charged-off loan Noninterest Income (Dollars in millions) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | | :-------------------------------- | :------ | :------ | :----------- | | Total Noninterest Income | $8.5 million | $2.3 million | +$6.2 million | | ERC Funds (included in other income) | $5.2 million | $0 | +$5.2 million | | Gain on Sale of Loans | $277,000 | - | Higher | | Recoveries on fully-charged off loan | $350,000 | - | - | - The ERC funds relate to qualifying amended payroll tax returns filed for Q1 and Q2 2021 under the Coronavirus Aid, Relief, and Economic Security Act[10] Noninterest Expense Noninterest expense increased, mainly due to higher legal and professional expenses largely attributable to ERC advisory costs, and increased salaries and employee benefits, though the efficiency ratio improved significantly due to higher noninterest income Noninterest Expense (Dollars in millions) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | | :-------------------------------- | :------ | :------ | :----------- | | Total Noninterest Expense | $20.5 million | $18.5 million | +$2.0 million | | Legal and Professional Expense | +$1.4 million | - | - | | ERC Advisory Costs (part of legal & professional) | $1.2 million | $0 | +$1.2 million | | Salaries and Employee Benefits | +$437,000 | - | - | | Efficiency Ratio | 57.2% | 65.1% | -7.9 pp | - The increase in compensation includes higher incentives, annual pay increases, and approximately $330,000 in costs related to executive management transitions, partially offset by lower payroll taxes[12] Income Taxes The effective tax rate for the second quarter of 2025 remained relatively stable compared to the previous quarter Effective Tax Rate | Metric | Q2 2025 | Q1 2025 | | :---------------- | :------ | :------ | | Effective Tax Rate | 27.8% | 28.2% | Balance Sheet Analysis Total Assets Total assets increased both quarter-over-quarter and year-over-year, indicating overall balance sheet growth Total Assets (Dollars in billions) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :---------------- | :------------ | :------------- | :------------ | | Total Assets | $4.1 billion | $4.0 billion | $3.9 billion | | QoQ Increase | +$80.6 million | - | - | | YoY Increase | +$221.9 million | - | - | Loan and Securities Portfolio Loans held for investment (HFI) continued to grow significantly, driven by new production across various loan categories, particularly single-family residential and commercial real estate, while the available-for-sale (AFS) securities portfolio also increased and net unrealized losses on AFS securities decreased Loan and Securities Portfolio (Dollars in millions) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------- | :------------ | | Loans HFI | $3.2 billion | $3.1 billion | $3.0 billion | | QoQ Increase (annualized) | +$91.6 million (12%) | - | - | | YoY Increase | +$187.0 million (6.1%) | - | - | | New Loan Production (Q2 2025) | $182.8 million | - | - | | Average Yield on New Production | 6.76% | - | - | | SFR Mortgage Loans (QoQ increase) | +$57.3 million | - | - | | CRE Loans (QoQ increase) | +$28.0 million | - | - | | SBA Loans (QoQ increase) | +$5.3 million | - | - | | C&I Loans (QoQ increase) | +$2.7 million | - | - | | Loan to Deposit Ratio | 101.5% | 100.0% | 100.9% | | AFS Securities | $413.1 million | $378.1 million | - | | Net Unrealized Losses on AFS | $23.1 million | $25.0 million | - | - The increase in AFS securities was primarily due to $68.0 million in purchases, offset by $33.0 million in maturities and amortization[16] Deposits Total deposits increased, driven by growth in both interest-bearing and noninterest-bearing deposits, with time deposits, particularly those greater than $250,000, seeing notable increases, while interest-bearing non-maturity deposits decreased Deposit Portfolio (Dollars in millions) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------- | :------------ | | Total Deposits | $3.2 billion | $3.1 billion | $3.0 billion | | QoQ Increase (annualized) | +$45.6 million (5.8%) | - | - | | YoY Increase | +$164.6 million (5.4%) | - | - | | Interest-Bearing Deposits (QoQ increase) | +$29.9 million | - | - | | Noninterest-Bearing Deposits (QoQ increase) | +$15.7 million | - | - | | Time Deposits (QoQ increase) | +$59.5 million | - | - | | Interest-Bearing Non-Maturity Deposits (QoQ decrease) | -$29.5 million | - | - | | Wholesale Deposits | $183.8 million | $158.5 million | $120.7 million | | Noninterest-Bearing Deposits as % of Total | 17.1% | 16.8% | 18.0% | Credit Quality Nonperforming Assets Nonperforming assets (NPAs) decreased quarter-over-quarter, primarily due to net charge-offs and payoffs, despite some additions from loans migrating to nonaccrual status Nonperforming Assets (Dollars in millions) | Metric | June 30, 2025 | March 31, 2025 | Change (QoQ) | | :-------------------------------- | :------------ | :------------- | :----------- | | Nonperforming Assets | $61.0 million | $64.6 million | -$3.6 million (-5.5%) | | Nonperforming Assets as % of Total Assets | 1.49% | 1.61% | -0.12 pp | | Net Charge-offs (contributing to decrease) | $3.3 million | - | - | | Payoffs and Paydowns (contributing to decrease) | $1.7 million | - | - | | Additions from Nonaccrual Migration | $1.4 million | - | - | Special Mention and Substandard Loans Special mention loans and substandard loans both increased quarter-over-quarter, with the rise in special mention loans due to new additions and balance increases, while substandard loans increased primarily from downgrades Special Mention and Substandard Loans (Dollars in millions) | Metric | June 30, 2025 | March 31, 2025 | Change (QoQ) | | :-------------------------------- | :------------ | :------------- | :----------- | | Special Mention Loans | $91.3 million | $64.3 million | +$27.0 million | | Special Mention Loans as % of Total Loans | 2.82% | 2.05% | +0.77 pp | | Substandard Loans | $91.0 million | $76.4 million | +$14.6 million | | Substandard Loans as % of Total Loans | 2.81% | 2.43% | +0.38 pp | - The increase in special mention loans was primarily due to $30.1 million in new additions and $1.6 million in balance increases, partially offset by downgrades and payoffs[19] - The increase in substandard loans was primarily due to $20.6 million in downgrades, partially offset by net charge-offs and payoffs[20] Delinquent Loans Loans 30-89 days past due, excluding nonperforming loans, significantly increased, mainly due to new delinquencies, though some loans returned to current status or migrated to nonaccrual Delinquent Loans (Dollars in millions) | Metric | June 30, 2025 | March 31, 2025 | Change (QoQ) | | :-------------------------------- | :------------ | :------------- | :----------- | | 30-89 Day Delinquent Loans | $18.0 million | $5.9 million | +$12.1 million | | 30-89 Day Delinquent Loans as % of Total Loans | 0.56% | 0.19% | +0.37 pp | - The increase was mostly due to $15.5 million in new delinquent loans, offset by $2.2 million returning to current status and $798,000 migrating to nonaccrual status[21] Allowance for Credit Losses The allowance for credit losses decreased slightly due to net charge-offs exceeding the provision for credit losses, however, the allowance for loan losses as a percentage of nonperforming loans increased, indicating improved coverage Allowance for Credit Losses (Dollars in millions) | Metric | June 30, 2025 | March 31, 2025 | Change (QoQ) | | :-------------------------------- | :------------ | :------------- | :----------- | | Allowance for Credit Losses | $51.6 million | $52.6 million | -$918,000 | | Allowance for Loan Losses | $51.0 million | $51.9 million | -$918,000 | | Allowance for Loan Losses as % of Loans HFI | 1.58% | 1.65% | -0.07 pp | | Allowance for Loan Losses as % of Nonperforming Loans HFI | 90% | 86% | +4 pp | | Net Charge-offs (Q2 2025) | $3.3 million | - | - | | Provision for Credit Losses (Q2 2025) | $2.4 million | - | - | - The decrease in the allowance for credit losses was due to net charge-offs of $3.3 million, offset by a $2.4 million provision for credit losses[22] Shareholders' Equity & Dividends Shareholders' Equity Total shareholders' equity increased quarter-over-quarter and year-over-year, driven by net income, lower unrealized losses on AFS securities, and equity compensation activity, partially offset by dividends and share repurchases Shareholders' Equity (Dollars in millions) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------- | :------------ | | Total Shareholders' Equity | $517.7 million | $510.3 million | $511.3 million | | QoQ Increase | +$7.3 million | - | - | | YoY Increase | +$6.4 million | - | - | | Net Income (Q2 2025) | $9.3 million | - | - | | Lower Net Unrealized Losses on AFS (Q2 2025) | $1.3 million | - | - | | Equity Compensation Activity (Q2 2025) | $1.1 million | - | - | | Common Stock Cash Dividends Paid (Q2 2025) | $2.9 million | - | - | | Common Stock Repurchases (Q2 2025) | $1.5 million | - | - | | Book Value Per Share | $29.25 | $28.77 | $28.12 | | Tangible Book Value Per Share | $25.11 | $24.63 | $24.06 | Dividend Announcement The Board of Directors declared a quarterly cash dividend of $0.16 per common share - A quarterly cash dividend of $0.16 per common share was declared, payable on August 12, 2025, to shareholders of record on July 31, 2025[26] Company Information Corporate Overview RBB Bancorp is a Los Angeles-based financial holding company with $4.1 billion in total assets as of June 30, 2025, whose subsidiary, Royal Business Bank, offers a full range of commercial and consumer banking services, primarily serving Asian-centric communities across multiple states with a network of 24 branches and an administrative/lending center - RBB Bancorp is headquartered in Los Angeles, California, with total assets of $4.1 billion as of June 30, 2025[27] - Royal Business Bank provides consumer and business banking services predominantly to Asian-centric communities in California, Nevada, New York, New Jersey, Illinois, and Hawaii[27] - Bank services include remote deposit, E-banking, mobile banking, various real estate and business loans (CRE, C&I, SBA, SFR), trade finance, depository products, and wealth management services[27] Conference Call Details Management will host a conference call on July 22, 2025, to discuss Q2 2025 financial results, with details provided for live access and replay options via phone and webcast - A conference call will be held on Tuesday, July 22, 2025, at 11:00 a.m. Pacific time/2:00 p.m. Eastern time[28] - Dial-in information: 1-888-506-0062 or 1-973-528-0011, Participant ID 710803, Conference ID RBBQ225, with a replay available until August 05, 2025[29] - The call will also be webcast live and available for replay on the Royal Business Bank website under the 'Investors' tab[30] Disclosure The press release includes non-GAAP financial disclosures for tangible common equity, tangible assets, and adjusted earnings, which management uses to provide supplemental information on operational performance and capital strength - The press release contains non-GAAP financial disclosures for tangible common equity, tangible assets, and adjusted earnings[31] - These non-GAAP measures are used by the Company to provide meaningful supplemental information regarding operational performance and to enhance investors' understanding[31] Safe Harbor Statement This section outlines that the report contains forward-looking statements subject to various risks and uncertainties that could cause actual results to differ materially, including economic conditions, regulatory changes, credit quality, interest rate fluctuations, and geopolitical events - The document contains forward-looking statements regarding the Company's business plans, expectations, future financial position, and operating results[32] - These statements are subject to risks and uncertainties, including business and economic conditions, credit risks, regulatory supervision, interest rate fluctuations, real estate market conditions, and geopolitical events[32] - The Company disclaims any obligation to update forward-looking statements, except as required by law[32] Financial Statements & Supplementary Data Condensed Consolidated Balance Sheets The condensed consolidated balance sheets provide a snapshot of the Company's financial position, detailing assets, liabilities, and shareholders' equity at various quarter-end dates, with key trends including growth in total assets and loans held for investment, alongside an increase in total deposits (Dollars in thousands) | (Dollars in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------- | :------------ | | Assets: | | | | | Total assets | $4,090,040 | $4,009,400 | $3,868,186 | | Net loans held for investment | $3,183,681 | $3,091,131 | $3,005,971 | | Investment securities available for sale | $413,142 | $378,188 | $325,582 | | Liabilities: | | | | | Total deposits | $3,188,231 | $3,142,628 | $3,023,605 | | FHLB advances | $180,000 | $160,000 | $150,000 | | Total liabilities | $3,572,387 | $3,499,094 | $3,356,895 | | Shareholders' Equity: | | | | | Total shareholders' equity | $517,653 | $510,306 | $511,291 | Condensed Consolidated Statements of Income The condensed consolidated statements of income present the Company's revenues, expenses, and net income for the three and six months ended June 30, 2025, and 2024, with notable changes including a significant increase in net income for Q2 2025 driven by higher noninterest income and improved net interest income (In thousands, except share and per share data) | (In thousands, except share and per share data) | Q2 2025 | Q1 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :---------------------------------------------- | :------ | :------ | :------ | :------ | :------ | | Total interest and dividend income | $54,205 | $52,336 | $52,886 | $106,541 | $107,681 | | Total interest expense | $26,871 | $26,173 | $28,921 | $53,044 | $58,839 | | Net interest income before provision for credit losses | $27,334 | $26,163 | $23,965 | $53,497 | $48,842 | | Provision for credit losses | $2,387 | $6,746 | $557 | $9,133 | $557 | | Total noninterest income | $8,478 | $2,295 | $3,488 | $10,773 | $6,860 | | Total noninterest expense | $20,493 | $18,522 | $17,124 | $39,015 | $34,093 | | Income before income taxes | $12,932 | $3,190 | $9,772 | $16,122 | $21,052 | | Income tax expense | $3,599 | $900 | $2,527 | $4,499 | $5,771 | | Net income | $9,333 | $2,290 | $7,245 | $11,623 | $15,281 | | Diluted EPS | $0.52 | $0.13 | $0.39 | $0.65 | $0.82 | | Cash dividends declared per common share | $0.16 | $0.16 | $0.16 | $0.32 | $0.32 | Average Balance Sheet and Net Interest Income This section provides detailed average balance sheet data and net interest income calculations for the three and six months ended June 30, 2025, and 2024, highlighting trends in average interest-earning assets, interest-bearing liabilities, and their respective yields and costs, which contribute to the net interest margin (Tax-equivalent basis, dollars in thousands) | (Tax-equivalent basis, dollars in thousands) | Q2 2025 | Q1 2025 | Q2 2024 | | :----------------------------------------- | :------ | :------ | :------ | | Average Interest-Earning Assets | $3,754,850 | $3,683,827 | $3,611,466 | | Yield on Average Interest-Earning Assets | 5.79% | 5.76% | 5.89% | | Average Total Loans | $3,171,570 | $3,079,224 | $3,017,050 | | Yield on Average Loans | 6.03% | 6.01% | 6.04% | | Average Interest-Bearing Liabilities | $2,903,797 | $2,845,777 | $2,758,760 | | Cost of Average Interest-Bearing Liabilities | 3.71% | 3.73% | 4.22% | | Net Interest Income | $27,357 | $26,189 | $23,988 | | Net Interest Margin | 2.92% | 2.88% | 2.67% | | Total Cost of Deposits | 3.05% | 3.13% | 3.59% | | Total Cost of Funds | 3.14% | 3.15% | 3.54% | (Tax-equivalent basis, dollars in thousands) | (Tax-equivalent basis, dollars in thousands) | 6M 2025 | 6M 2024 | | :----------------------------------------- | :------ | :------ | | Average Interest-Earning Assets | $3,719,535 | $3,667,545 | | Yield on Average Interest-Earning Assets | 5.78% | 5.91% | | Average Total Loans | $3,125,652 | $3,017,737 | | Yield on Average Loans | 6.02% | 6.06% | | Average Interest-Bearing Liabilities | $2,874,948 | $2,815,898 | | Cost of Average Interest-Bearing Liabilities | 3.72% | 4.20% | | Net Interest Income | $53,547 | $48,891 | | Net Interest Margin | 2.90% | 2.68% | | Total Cost of Deposits | 3.09% | 3.59% | | Total Cost of Funds | 3.15% | 3.54% | Selected Financial Highlights - Performance Ratios This section provides key performance ratios, illustrating the Company's profitability, efficiency, and asset/liability management, with significant improvements seen in return on average assets and equity, and the efficiency ratio, primarily driven by the strong Q2 2025 results Performance Ratios | Metric | Q2 2025 | Q1 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :--------------------------------------- | :------ | :------ | :------ | :------ | :------ | | Book value per share | $29.25 | $28.77 | $28.12 | $29.25 | $28.12 | | Tangible book value per share (Non-GAAP) | $25.11 | $24.63 | $24.06 | $25.11 | $24.06 | | Return on average assets, annualized | 0.93% | 0.24% | 0.76% | 0.59% | 0.79% | | Return on average shareholders' equity, annualized | 7.29% | 1.81% | 5.69% | 4.57% | 6.00% | | Return on average tangible common equity, annualized (Non-GAAP) | 8.50% | 2.12% | 6.65% | 5.33% | 7.01% | | Net interest margin | 2.92% | 2.88% | 2.67% | 2.90% | 2.68% | | Efficiency ratio | 57.22% | 65.09% | 62.38% | 60.70% | 61.21% | | Common stock dividend payout ratio | 30.19% | 123.08% | 41.03% | 48.48% | 38.55% | Selected Financial Highlights - Credit Quality & Capital Ratios This section details credit quality metrics, showing an increase in special mention and substandard loans but a decrease in nonperforming assets, while capital ratios remain strong, indicating robust financial health Credit Quality & Capital Ratios (Dollars in thousands) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :---------------------------------------------- | :------------ | :------------- | :------------ | | Special mention loans | $91,317 | $64,279 | $19,520 | | Special mention loans to total loans HFI | 2.82% | 2.05% | 0.64% | | Substandard loans | $91,019 | $76,372 | $63,076 | | Substandard loans to total loans HFI | 2.81% | 2.43% | 2.07% | | Loans 30-89 days past due, excluding nonperforming loans | $18,003 | $5,927 | $11,270 | | Nonperforming assets | $60,987 | $64,550 | $54,589 | | Nonperforming assets to total assets | 1.49% | 1.61% | 1.41% | | Allowance for loan losses to total loans HFI | 1.58% | 1.65% | 1.37% | | Allowance for loan losses to nonperforming loans HFI | 89.79% | 86.01% | 76.46% | | Net charge-offs to average loans | 0.42% | 0.35% | 0.07% | | Tangible common equity to tangible assets (Non-GAAP) | 11.07% | 11.10% | 11.53% | | Tier 1 leverage ratio | 12.04% | 12.07% | 12.48% | | Total capital to risk-weighted assets | 24.00% | 24.42% | 25.67% | - June 30, 2025 capital ratios are preliminary[48] Selected Financial Highlights - Loan & Deposit Portfolio Detail This section provides a detailed breakdown of the loan and deposit portfolios, highlighting the composition and changes over time, with single-family residential mortgages and commercial real estate loans constituting the largest portions of the loan portfolio, while time deposits are the largest component of deposits Loan Portfolio Detail (dollars in thousands) | Loan Portfolio Detail (dollars in thousands) | June 30, 2025 | % | March 31, 2025 | % | June 30, 2024 | % | | :------------------------------------------- | :------------ | :- | :------------- | :- | :------------ | :- | | Commercial and industrial | $138,263 | 4.3% | $135,538 | 4.3% | $126,649 | 4.2% | | SBA | $55,984 | 1.7% | $50,651 | 1.6% | $50,323 | 1.7% | | Construction and land development | $157,970 | 4.9% | $158,883 | 5.1% | $202,459 | 6.6% | | Commercial real estate | $1,273,442 | 39.4% | $1,245,402 | 39.6% | $1,190,207 | 39.1% | | Single-family residential mortgages | $1,603,114 | 49.6% | $1,545,822 | 49.2% | $1,467,802 | 48.2% | | Total loans | $3,234,695 | 100.0% | $3,143,063 | 100.0% | $3,047,712 | 100.0% | Deposit Portfolio Detail (dollars in thousands) | Deposit Portfolio Detail (dollars in thousands) | June 30, 2025 | % | March 31, 2025 | % | June 30, 2024 | % | | :---------------------------------------------- | :------------ | :- | :------------- | :- | :------------ | :- | | Noninterest-bearing demand | $543,885 | 17.1% | $528,205 | 16.8% | $542,971 | 18.0% | | Savings, NOW and money market accounts | $691,679 | 21.7% | $721,216 | 22.9% | $647,770 | 21.4% | | Time deposits, $250,000 and under | $848,379 | 26.6% | $863,962 | 27.5% | $921,712 | 30.5% | | Time deposits, greater than $250,000 | $920,481 | 28.8% | $870,708 | 27.8% | $790,478 | 26.1% | | Wholesale deposits | $183,807 | 5.8% | $158,537 | 5.0% | $120,674 | 4.0% | | Total deposits | $3,188,231 | 100.0% | $3,142,628 | 100.0% | $3,023,605 | 100.0% | Non-GAAP Reconciliations Tangible Book Value Reconciliations This section provides a reconciliation of tangible book value to GAAP shareholders' equity, demonstrating how goodwill and core deposit intangibles are adjusted, with management using this non-GAAP measure to assess capital strength and business performance (Dollars in thousands, except share and per share data) | (Dollars in thousands, except share and per share data) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :------------------------------------------------------ | :------------ | :------------- | :------------ | | Total shareholders' equity (GAAP) | $517,653 | $510,306 | $511,291 | | Goodwill adjustment | ($71,498) | ($71,498) | ($71,498) | | Core deposit intangible adjustment | ($1,667) | ($1,839) | ($2,394) | | Tangible common equity | $444,488 | $436,969 | $437,399 | | Total assets (GAAP) | $4,090,040 | $4,009,400 | $3,868,186 | | Tangible assets | $4,016,875 | $3,936,063 | $3,794,294 | | Tangible common equity to tangible assets ratio | 11.07% | 11.10% | 11.53% | | Tangible book value per share | $25.11 | $24.63 | $24.06 | - Tangible book value per share is a non-GAAP disclosure used by management to assess the Company's capital strength and business performance, providing additional insight for investors[55] Return on Average Tangible Common Equity This section reconciles Return on Average Tangible Common Equity (ROATCE) to its most comparable GAAP measure, Return on Average Common Equity, with ROATCE being a non-GAAP measure used by management and regulators to evaluate capital adequacy and performance, excluding goodwill and other intangible assets (Dollars in thousands) | (Dollars in thousands) | Q2 2025 | Q1 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :--------------------------------------- | :------ | :------ | :------ | :------ | :------ | | Net income available to common shareholders | $9,333 | $2,290 | $7,245 | $11,623 | $15,281 | | Average shareholders' equity | $513,691 | $512,262 | $512,185 | $512,981 | $512,486 | | Adjusted average tangible common equity | $440,413 | $438,813 | $438,162 | $439,618 | $438,363 | | Return on average common equity, annualized | 7.29% | 1.81% | 5.69% | 4.57% | 6.00% | | Return on average tangible common equity, annualized | 8.50% | 2.12% | 6.65% | 5.33% | 7.01% | - ROATCE is a non-GAAP financial measure that excludes goodwill and other intangible assets (excluding mortgage servicing rights) and is reviewed by banking regulators when assessing capital adequacy[57]