Simmons First National (SFNC) - 2025 Q3 - Quarterly Results

Executive Summary & Q3 2025 Highlights Simmons experienced a transformative Q3 2025, marked by a significant equity capital raise and balance sheet repositioning, resulting in a GAAP net loss but improved adjusted profitability CEO Commentary Simmons' Chairman and CEO, George Makris, Jr., described Q3 2025 as a transformative quarter, marked by a successful $327 million equity capital raise to reposition the balance sheet. This move addressed a negative arbitrage between bond yields and funding costs, freeing up capital for future growth despite a significant one-time loss on bond sales. The benefits of this repositioning were partially realized, showing exceptional improvement in profitability, and the company is optimistic about delivering stronger organic growth - The third quarter of 2025 was transformative for Simmons, marked by a successful $327 million equity capital raise[1] - The capital raise was used to reposition the balance sheet, addressing a negative arbitrage between long-term bond yields and shorter-term funding costs, freeing up capital for future growth[1] - Despite a significant one-time loss on the sale of bonds, the company demonstrated exceptional improvement in profitability, with September results being very encouraging for future performance[1][2] - Simmons is now well-positioned to deliver stronger organic growth across its franchise[3] Key Financial Results (GAAP & Adjusted) Simmons First National Corporation reported a net loss of $562.8 million for Q3 2025, a significant decline from net income in prior quarters, primarily due to a $801.5 million pre-tax loss on the sale of securities. However, adjusted earnings, which exclude this and other specific items, showed an increase to $64.9 million, reflecting improved underlying profitability Net Income (Loss) and Diluted EPS (GAAP) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Net income (loss) | $(562.8) million | $54.8 million | $24.7 million | | Diluted earnings per share | $(4.00) | $0.43 | $0.20 | Adjusted Earnings and Diluted EPS (Non-GAAP) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Adjusted earnings | $64.9 million | $56.1 million | $46.0 million | | Adjusted diluted earnings per share | $0.46 | $0.44 | $0.37 | - The net loss in 3Q25 was primarily driven by an $801.5 million pre-tax loss on the sale of low-yielding investment securities as part of a balance sheet repositioning[5][7][14] Balance Sheet Repositioning The Company completed a public offering of Class A common stock, generating approximately $327 million in net proceeds. These proceeds were used to support a balance sheet repositioning, which involved selling approximately $2.4 billion (fair value) of low-yielding investment securities at an after-tax loss of about $626 million. The funds from the securities sale were primarily used to reduce higher-rate, non-relationship wholesale and public fund deposits, as well as FHLB advances, with the full benefits of interest expense savings only partially reflected in Q3 2025 results - Raised approximately $327 million of equity capital through a public offering of Class A common stock[1][5] - Sold approximately $2.4 billion (fair value) of low-yielding investment securities, resulting in an after-tax loss of approximately $626 million[5] - Proceeds from the securities sale were used to deleverage the balance sheet by paying down higher-rate, non-relationship wholesale and public fund deposits, and FHLB advances[5] - The benefits of this repositioning, including interest expense savings, were only partially reflected in the third quarter 2025 results due to timing[2][5] Financial Performance Analysis Q3 2025 financial performance was characterized by increased net interest income, a substantial noninterest income loss from securities sales, and a slight rise in noninterest expense Net Interest Income Net interest income for Q3 2025 increased by 9% QoQ and 18% YoY, reaching $186.7 million. This improvement was driven by a decrease in interest expense due to the balance sheet repositioning, which offset a decline in interest income from investment securities. The net interest margin (FTE) significantly increased by 44 basis points QoQ to 3.50%, marking the sixth consecutive quarterly increase Net Interest Income (in millions) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Net Interest Income | $186.7 | $171.8 | $157.7 | | Interest Income | $313.4 | $315.0 | $334.3 | | Interest Expense | $126.8 | $143.2 | $176.6 | - Net interest income increased by $14.8 million (9%) QoQ and $28.9 million (18%) YoY[10] - The decrease in interest income QoQ was primarily due to a decline from investment securities, offset by increases from loans and other earning assets[10][12] - Interest expense decreased QoQ primarily due to a reduction of higher-rate, non-relationship wholesale and public fund deposits as part of the balance sheet repositioning[12] Select Yield/Rates (FTE) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Loan yield | 6.31% | 6.26% | 6.44% | | Investment securities yield | 4.01% | 3.48% | 3.63% | | Cost of deposits | 2.25% | 2.36% | 2.79% | | Net interest margin | 3.50% | 3.06% | 2.74% | - Net interest margin (FTE) increased by 44 basis points QoQ to 3.50%, marking the 6th consecutive quarterly increase[9][13] Noninterest Income Noninterest income for Q3 2025 was $(756.2) million, significantly impacted by an $801.5 million pre-tax loss on the sale of low-yielding securities. Excluding this and other specific items, adjusted noninterest income increased to $45.9 million, driven by broad-based growth, particularly in mortgage lending income Noninterest Income (in millions) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Total noninterest income | $(756.2) | $42.4 | $17.1 | | Loss on sale of securities | $(801.5) | — | $(28.4) | | Adjusted noninterest income | $45.9 | $42.4 | $45.5 | - The $801.5 million pre-tax loss on the sale of low-yielding securities was the primary driver of the negative total noninterest income[14][15] - Adjusted noninterest income increased QoQ, led by an increase in mortgage lending income and a recovery from a prior quarter's SBIC negative valuation adjustment[14] Noninterest Expense Noninterest expense for Q3 2025 was $142.0 million, a slight increase QoQ. Excluding certain items like branch right-sizing and early retirement program costs, adjusted noninterest expense was $139.7 million. The QoQ increase in adjusted noninterest expense primarily reflected salary and employee benefits accrual adjustments and a fraud recovery Noninterest Expense (in millions) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Total noninterest expense | $142.0 | $138.6 | $137.2 | | Certain items (pre-tax impact) | $2.3 | $1.8 | $0.4 | | Adjusted noninterest expense | $139.7 | $136.8 | $136.8 | - The increase in adjusted noninterest expense QoQ was primarily due to salary and employee benefits accrual adjustments and a $1.6 million fraud recovery[16] Balance Sheet Overview The balance sheet reflects modest loan growth, a strategic reduction in deposits and borrowings, and an improved deposit mix following repositioning efforts Loans and Unfunded Loan Commitments Total loans at the end of Q3 2025 were $17.2 billion, showing a 2% linked-quarter annualized increase. This growth was driven by increases in mortgage warehouse, real estate – construction, and agricultural loans, partially offset by declines in commercial and real estate – commercial portfolios. Unfunded loan commitments continued their upward trend, marking the fourth consecutive quarterly increase Loans and Unfunded Loan Commitments (in millions) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Total loans | $17,189 | $17,111 | $17,336 | | Unfunded loan commitments | $3,955 | $3,947 | $3,681 | - Total loans increased by 2% on a linked-quarter annualized basis, driven by mortgage warehouse, real estate – construction, and agricultural loans[18] - Unfunded loan commitments increased for the fourth consecutive quarter, reaching $4.0 billion[18][19] - The commercial loan pipeline totaled $1.6 billion, with $490 million ready to close at a weighted average rate of 7.19%[18] Deposits and Other Borrowings Total deposits decreased to $19.8 billion at the end of Q3 2025, primarily due to the reduction of higher-rate, non-relationship wholesale and public fund deposits as part of the balance sheet repositioning. This led to an improved deposit mix, with noninterest-bearing deposits increasing to 22.1% of total deposits and interest-bearing transaction accounts (excluding public funds) rising to 42.8%. Other borrowings also significantly decreased due to the pay-down of higher-cost wholesale funding Deposits (in millions) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Total deposits | $19,838 | $21,825 | $21,935 | | Noninterest bearing deposits | $4,377 | $4,468 | $4,522 | | Noninterest bearing deposits to total deposits | 22% | 20% | 21% | - Total deposits decreased due to the reduction of higher-rate, non-relationship wholesale and public fund deposits as part of the balance sheet repositioning[20] - The deposit mix improved, with noninterest-bearing deposits increasing to 22.1% of total deposits (from 20.5% in 2Q25) and interest-bearing transaction accounts (excluding public funds) rising to 42.8% (from 39.0% in 2Q25)[20] Other Borrowings (in millions) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Other borrowings | $18.8 | $634.3 | $1,000.0 | - Other borrowings significantly decreased QoQ and YoY due to the pay-down of higher-cost wholesale funding, primarily FHLB advances[21] Asset Quality Total nonperforming loans decreased QoQ to $153.9 million but increased YoY, primarily due to two specific credit relationships placed on nonaccrual in Q1 2025. The nonperforming loan coverage ratio improved QoQ to 168%, while nonperforming assets to total assets slightly increased. Provision for credit losses on loans increased to $15.2 million, and the allowance for credit losses on loans (ACL) grew to $258.0 million, representing 1.50% of total loans Asset Quality Metrics (in millions, except ratios) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Total nonperforming loans | $153.9 | $157.2 | $101.7 | | Nonperforming loan coverage ratio | 168% | 161% | 229% | | Nonperforming assets to total assets | 0.66% | 0.62% | 0.38% | | Provision for credit losses on loans | $15.2 | $11.9 | $12.1 | | Allowance for credit losses on loans (ACL) | $258.0 | $253.5 | $233.2 | | ACL to total loans | 1.50% | 1.48% | 1.35% | | Net charge-off ratio (annualized) | 0.25% | 0.25% | 0.22% | - The QoQ decrease in nonperforming loans was mainly due to declines in commercial and real estate – single-family loan portfolios, partially offset by an increase in real estate – commercial[23] - The YoY increase in nonperforming loans was primarily due to two specific credit relationships placed on nonaccrual at the end of Q1 2025[24] - Provision for credit losses on loans exceeded net charge-offs by $4.5 million in Q3 2025[26] Capital and Subordinated Debt Total stockholders' equity decreased QoQ and YoY to $3.4 billion, reflecting the loss on sale of securities, partially offset by $327 million net proceeds from a common equity offering. Book value per share and tangible book value per share also decreased due to the securities sale loss. Despite these changes, all regulatory capital ratios for Simmons and Simmons Bank continue to significantly exceed 'well-capitalized' guidelines. The Company also completed an offering of $325 million in 6.25% Fixed-to-Floating Rate Subordinated Notes due 2035, using proceeds to repay existing subordinated debt Capital Metrics (in millions, except per share data) | Metric | 3Q25 | 2Q25 | 3Q24 | | :--- | :--- | :--- | :--- | | Total stockholders' equity | $3,354 | $3,549 | $3,529 | | Book value per share | $23.18 | $28.17 | $28.11 | | Tangible book value per share | $13.45 | $16.97 | $16.78 | | Equity to assets | 13.85% | 13.30% | 12.94% | | Tangible common equity (TCE) ratio | 8.53% | 8.46% | 8.15% | | Common equity tier 1 (CET1) ratio | 11.54% | 12.36% | 12.06% | | Tier 1 leverage ratio | 9.56% | 9.96% | 9.57% | | Tier 1 risk-based capital ratio | 11.54% | 12.36% | 12.06% | | Total risk-based capital ratio | 15.07% | 14.42% | 14.25% | - The decrease in stockholders' equity, book value per share, and tangible book value per share was primarily due to the loss on the sale of investment securities, partially offset by $327 million from a common equity offering[28] - All applicable regulatory capital ratios for Simmons and Simmons Bank continue to significantly exceed 'well-capitalized' guidelines[29] - Completed an offering of $325 million in 6.25% Fixed-to-Floating Rate Subordinated Notes due 2035, using proceeds to repay $330 million of Notes due 2028 and $37 million of Notes due 2030[30] Share Repurchase Program Simmons did not repurchase shares under its 2024 stock repurchase program during Q3 2025. Approximately $175 million remained authorized under the program as of September 30, 2025, with future repurchases subject to management's discretion based on various market and corporate factors - No shares were repurchased under the 2024 stock repurchase program during Q3 2025[32] - Approximately $175 million remained authorized under the 2024 Program as of September 30, 2025[32] - The timing, pricing, and amount of any future repurchases are at management's discretion, based on market conditions, capital needs, and other corporate considerations[32] Company Information & Disclosures This section provides details on the Q3 2025 conference call, company background, non-GAAP financial measure explanations, and forward-looking statement disclosures Conference Call Details Management will host a live conference call on Friday, October 17, 2025, at 7:30 a.m. Central Time to discuss the Q3 2025 results. The call details, including a toll-free number and conference ID, are provided, and a recorded version will be available on Simmons' website - A live conference call to review Q3 2025 results will be held on Friday, October 17, 2025, at 7:30 a.m. Central Time[33] - Interested persons can dial toll-free 1-844-481-2779 (North America only) using conference ID 10203266[33] - The call will also be available live or in recorded version on simmonsbank.com for at least 60 days[33] About Simmons First National Corporation Simmons First National Corporation (NASDAQ: SFNC) is a Mid-South based financial holding company with a 116-year history of paying cash dividends. Its principal subsidiary, Simmons Bank, operates over 220 branches across six states and has received multiple recognitions for being a great workplace and a top regional bank - Simmons First National Corporation (NASDAQ: SFNC) is a Mid-South based financial holding company[34] - The company has paid cash dividends to shareholders for 116 consecutive years[34] - Simmons Bank, its principal subsidiary, operates over 220 branches in Arkansas, Kansas, Missouri, Oklahoma, Tennessee, and Texas[34] - Simmons Bank has been recognized as one of America's Greatest Workplaces 2025 by Newsweek and one of America's Best Regional Banks 2025[34] Non-GAAP Financial Measures Explanation The press release includes non-GAAP financial measures, which management uses to analyze performance by adjusting GAAP measures for tax benefits, and excluding certain income and expense items (e.g., losses on securities sales, branch right-sizing costs, early retirement programs, debt extinguishment losses) not central to ongoing operations. These measures also present figures based on tangible common stockholders' equity, tangible assets, and tangible book value, excluding goodwill and other intangible assets. Management believes these non-GAAP measures provide useful supplemental information for understanding ongoing business results but should not be viewed as a substitute for GAAP results - Non-GAAP financial measures are used by management to analyze performance by adjusting GAAP measures for tax benefits and excluding certain non-recurring or non-core income and expense items[35][36] - These adjustments include losses on sale of securities, net branch right-sizing initiatives, early retirement program costs, termination of vendor and software services, and losses on early extinguishment of debt[35] - The Company also presents figures based on tangible common stockholders' equity, tangible assets, and tangible book value, which exclude goodwill and other intangible assets[36] - Management believes these non-GAAP measures provide useful supplemental information for understanding ongoing business operations but are not a substitute for GAAP results[38] Forward-Looking Statements This section contains forward-looking statements, identified by future-oriented terminology, regarding Simmons' future growth, financial performance, asset quality, dividends, and economic conditions. These statements are based on assumptions and involve inherent risks and uncertainties, including changes in economic conditions, interest rates, credit quality, and market disruptions. Simmons undertakes no obligation to update these statements, and actual results may differ materially due to various factors outlined in the Company's SEC filings - The press release contains forward-looking statements regarding future growth, business strategies, lending capacity, profitability, dividends, and economic conditions[39] - These statements are based on various assumptions and involve inherent risks and uncertainties, such as changes in economic conditions, interest rates, credit quality, and market disruptions[39] - Simmons undertakes no obligation to update these statements, and actual results could differ materially from projections[39] Contact Information For more information, interested parties can contact Ed Bilek, EVP, Director of Investor and Media Relations, via email or cell phone - Contact: Ed Bilek, EVP, Director of Investor and Media Relations[40] - Email: ed.bilek@simmonsbank.com, Cell: 205.612.3378[40] Consolidated Financial Statements (Tables) This section presents detailed consolidated financial statements, including balance sheets, income statements, capital, investment securities, loans, asset quality, and selected financial data Consolidated End of Period Balance Sheets The consolidated balance sheet shows a decrease in total assets, total investment securities, and total deposits from Q2 2025 to Q3 2025, reflecting the balance sheet repositioning activities. Total shareholders' equity also saw a slight decrease Consolidated End of Period Balance Sheets (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total assets | $24,208,162 | $26,693,620 | $27,269,404 | | Total investment securities | $3,319,277 | $5,996,851 | $6,349,794 | | Total loans (net) | $16,930,811 | $16,857,559 | $17,102,817 | | Total deposits | $19,837,733 | $21,824,990 | $21,935,434 | | Total liabilities | $20,854,199 | $23,144,410 | $23,740,571 | | Total stockholders' equity | $3,353,963 | $3,549,210 | $3,528,833 | Consolidated Statements of Income - Quarter-to-Date The consolidated income statement for Q3 2025 shows a net loss of $562.8 million, primarily driven by a significant loss on the sale of securities. Net interest income increased, while interest expense decreased due to balance sheet repositioning. Provision for credit losses also increased QoQ Consolidated Statements of Income - Quarter-to-Date (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total interest income | $313,423 | $315,023 | $334,289 | | Total interest expense | $126,762 | $143,199 | $176,577 | | Net interest income | $186,661 | $171,824 | $157,712 | | Total provision for credit losses | $11,966 | $11,945 | $12,148 | | Total noninterest income | $(756,187) | $42,354 | $17,130 | | Total noninterest expense | $142,032 | $138,589 | $137,193 | | Net income (loss) | $(562,792) | $54,773 | $24,740 | | Diluted earnings per share | $(4.00) | $0.43 | $0.20 | Consolidated Risk-Based Capital The consolidated risk-based capital ratios show that Simmons continues to maintain strong capital levels, with all ratios exceeding regulatory requirements. While the Common Equity Tier 1 (CET1) ratio saw a slight decrease QoQ, other ratios like Equity to Assets and Total Risk-Based Capital increased Consolidated Risk-Based Capital Ratios | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Equity to assets | 13.85% | 13.30% | 12.94% | | Tangible common equity to tangible assets | 8.53% | 8.46% | 8.15% | | Common equity Tier 1 (CET1) ratio | 11.54% | 12.36% | 12.06% | | Tier 1 leverage ratio | 9.56% | 9.96% | 9.57% | | Tier 1 risk-based capital ratio | 11.54% | 12.36% | 12.06% | | Total risk-based capital ratio | 15.07% | 14.42% | 14.25% | Consolidated Investment Securities Total investment securities significantly decreased from $5.997 billion in Q2 2025 to $3.319 billion in Q3 2025, primarily due to the sale of held-to-maturity (HTM) securities as part of the balance sheet repositioning. As a result, the HTM portfolio was reduced to zero, while available-for-sale (AFS) securities increased Consolidated Investment Securities (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total held-to-maturity | $0 | $3,591,531 | $3,658,700 | | Total available-for-sale | $3,319,277 | $2,405,320 | $2,691,094 | | Total investment securities | $3,319,277 | $5,996,851 | $6,349,794 | - The held-to-maturity (HTM) investment securities portfolio was reduced to zero in Q3 2025, down from $3.59 billion in Q2 2025, reflecting the balance sheet repositioning[45] Consolidated Loans The loan portfolio at the end of Q3 2025 showed a slight increase in total loans QoQ, driven by growth in real estate construction and agricultural loans, while commercial and other consumer loans experienced declines Loan Portfolio - End of Period (in thousands) | Loan Category | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total consumer | $285,355 | $299,997 | $291,592 | | Total real estate | $13,368,321 | $13,371,707 | $13,513,463 | | Total commercial | $2,750,569 | $2,773,585 | $2,781,724 | | Other | $784,572 | $665,807 | $749,261 | | Total loans | $17,188,817 | $17,111,096 | $17,336,040 | - Real estate construction loans increased from $2.78 billion in Q2 2025 to $2.87 billion in Q3 2025[46] - Agricultural loans increased from $333.08 million in Q2 2025 to $353.18 million in Q3 2025[46] Consolidated Allowance and Asset Quality The allowance for credit losses on loans increased to $258.0 million, representing 1.50% of total loans. Net loans charged off remained stable QoQ at $10.7 million, while total nonperforming assets decreased slightly to $160.7 million Consolidated Allowance and Asset Quality (in thousands, except ratios) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Allowance for Credit Losses on Loans (end balance) | $258,006 | $253,537 | $233,223 | | Total loans charged off | $11,891 | $11,760 | $10,662 | | Total recoveries | $1,180 | $1,184 | $1,348 | | Net loans charged off | $10,711 | $10,576 | $9,314 | | Total nonperforming loans | $153,939 | $157,162 | $101,695 | | Total nonperforming assets | $160,717 | $166,715 | $104,305 | | Allowance for credit losses on loans to total loans | 1.50% | 1.48% | 1.35% | | Nonperforming loans to total loans | 0.90% | 0.92% | 0.59% | | Annualized net charge offs to average loans (QTD) | 0.25% | 0.25% | 0.22% | Consolidated - Average Balance Sheet and Net Interest Income Analysis The average balance sheet analysis highlights a decrease in average interest-earning assets and interest-bearing liabilities QoQ. Despite this, net interest income (FTE) increased, and the net interest margin (FTE) significantly expanded to 3.50%, reflecting improved interest rate management and the impact of the balance sheet repositioning Average Balance Sheet and Net Interest Income Analysis (in thousands, except rates) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :--- | :--- | :--- | :--- | | Average total interest earning assets (FTE) | $21,562,085 | $23,327,635 | $23,869,558 | | Average total interest bearing liabilities | $16,858,708 | $18,400,291 | $18,852,816 | | Net interest income (FTE) | $190,472 | $178,246 | $164,110 | | Net interest spread (FTE) | 2.86% | 2.41% | 1.95% | | Net interest margin (FTE) | 3.50% | 3.06% | 2.74% | - The net interest margin (FTE) increased by 44 basis points QoQ, reaching 3.50%[48] Consolidated - Selected Financial Data Selected financial data for Q3 2025 shows a GAAP net loss and negative diluted EPS, but positive adjusted earnings and adjusted diluted EPS. Key performance ratios like Return on Average Assets and Efficiency Ratio were significantly impacted by the one-time loss on securities sale, but adjusted metrics show healthier underlying performance Financial Highlights - As Reported (Quarter-to-Date, in thousands, except per share data) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net Income (loss) | $(562,792) | $54,773 | $24,740 | | Diluted earnings per share | $(4.00) | $0.43 | $0.20 | | Return on average assets | -8.96% | 0.82% | 0.36% | | Net interest margin (FTE) | 3.50% | 3.06% | 2.74% | | Efficiency ratio | -25.11% | 62.82% | 75.70% | Financial Highlights - Adjusted (Non-GAAP, Quarter-to-Date, in thousands, except per share data) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Adjusted earnings | $64,930 | $56,071 | $46,005 | | Adjusted diluted earnings per share | $0.46 | $0.44 | $0.37 | | Adjusted return on average assets | 1.03% | 0.84% | 0.67% | | Adjusted efficiency ratio | 57.72% | 60.52% | 63.38% | End of Period Metrics (in thousands, except per share data) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Book value per share | $23.18 | $28.17 | $28.11 | | Tangible book value per share | $13.45 | $16.97 | $16.78 | | Shares outstanding | 144,703,075 | 125,996,248 | 125,554,598 | | Full-time equivalent employees | 2,883 | 2,947 | 2,972 | | Total number of financial centers | 223 | 223 | 234 | Reconciliation of Non-GAAP Financial Measures (Tables) This section provides detailed reconciliations of GAAP to non-GAAP financial measures for adjusted earnings, capital ratios, and performance metrics on both quarter-to-date and year-to-date bases Reconciliation Of Non-GAAP Financial Measures - Adjusted Earnings - Quarter-to-Date This table provides a detailed reconciliation of GAAP net income (loss) to adjusted earnings and diluted EPS for the quarter, highlighting the impact of specific non-GAAP adjustments such as loss on early extinguishment of debt, early retirement program costs, loss on sale of securities, and branch right-sizing costs Reconciliation of Adjusted Earnings - Quarter-to-Date (in thousands, except per share data) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net income (loss) | $(562,792) | $54,773 | $24,740 | | Loss on early extinguishment of debt | $570 | — | — | | Early retirement program | $305 | $1,594 | $(1) | | Loss on sale of securities | $801,492 | — | $28,393 | | Branch right sizing (net) | $2,004 | $163 | $410 | | Tax effect of certain items | $(176,649) | $(459) | $(7,524) | | Adjusted earnings (non-GAAP) | $64,930 | $56,071 | $46,005 | | Diluted earnings per share | $(4.00) | $0.43 | $0.20 | | Adjusted diluted earnings per share (non-GAAP) | $0.46 | $0.44 | $0.37 | Reconciliation Of Non-GAAP Financial Measures - Adjusted Earnings - Year-to-Date This table presents the year-to-date reconciliation of GAAP net income (loss) to adjusted earnings and diluted EPS, showing the cumulative impact of non-GAAP adjustments over the year, including the significant loss on sale of securities in Q3 2025 Reconciliation of Adjusted Earnings - Year-to-Date (in thousands, except per share data) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net income (loss) | $(475,631) | $87,161 | $104,374 | | Loss on early extinguishment of debt | $570 | — | — | | Early retirement program | $1,899 | $1,594 | $336 | | Loss on sale of securities | $801,492 | — | $28,393 | | Branch right sizing (net) | $3,161 | $1,157 | $1,165 | | Tax effect of certain items | $(177,368) | $(719) | $(8,449) | | Adjusted earnings (non-GAAP) | $154,123 | $89,193 | $128,253 | | Diluted earnings per share | $(3.63) | $0.69 | $0.83 | | Adjusted diluted earnings per share (non-GAAP) | $1.18 | $0.71 | $1.02 | Reconciliation Of Non-GAAP Financial Measures - End of Period This section provides reconciliations for end-of-period non-GAAP measures, specifically detailing the calculation of tangible common equity, the ratio of tangible common equity to tangible assets, and tangible book value per share by adjusting for goodwill and other intangible assets. It also includes the calculation of the coverage ratio of uninsured, non-collateralized deposits and the net charge-off ratio excluding run-off portfolios Calculation of Tangible Common Equity and Ratios (in thousands, except per share data) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total common stockholders' equity | $3,353,963 | $3,549,210 | $3,528,833 | | Total intangibles | $(1,408,319) | $(1,411,416) | $(1,421,892) | | Tangible common stockholders' equity | $1,945,644 | $2,137,794 | $2,106,941 | | Total assets | $24,208,162 | $26,693,620 | $27,269,404 | | Tangible assets | $22,799,843 | $25,282,204 | $25,847,512 | | Ratio of tangible common equity to tangible assets | 8.53% | 8.46% | 8.15% | | Book value per common share | $23.18 | $28.17 | $28.11 | | Tangible book value per common share | $13.45 | $16.97 | $16.78 | Calculation of Coverage Ratio of Uninsured, Non-Collateralized Deposits (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total uninsured, non-collateralized deposits | $4,459,257 | $4,594,700 | $4,658,703 | | Additional liquidity sources | $9,533,000 | $10,724,000 | $11,174,000 | | Uninsured, non-collateralized deposit coverage ratio | 2.1 | 2.3 | 2.4 | Calculation of Net Charge Off Ratio (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net charge offs | $10,711 | $10,576 | $9,314 | | Net charge offs excluding run-off portfolio | $10,211 | $9,476 | $5,814 | | Annualized net charge offs to average loans (NCO ratio) | 0.25% | 0.25% | 0.22% | | NCO ratio, excluding run-off portfolio (annualized) | 0.24% | 0.22% | 0.13% | Reconciliation Of Non-GAAP Financial Measures - Quarter-to-Date (continued) This section provides further quarter-to-date reconciliations for non-GAAP financial measures, including adjusted return on average assets, return on tangible common equity, adjusted return on average common equity, adjusted return on tangible common equity, efficiency ratio, and adjusted efficiency ratio. It also reconciles total revenue and pre-provision net revenue (PPNR) to their adjusted non-GAAP counterparts Calculation of Adjusted Return on Average Assets (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net income (loss) | $(562,792) | $54,773 | $24,740 | | Adjusted earnings (non-GAAP) | $64,930 | $56,071 | $46,005 | | Average total assets | $24,914,922 | $26,645,131 | $27,216,440 | | Return on average assets | -8.96% | 0.82% | 0.36% | | Adjusted return on average assets (non-GAAP) | 1.03% | 0.84% | 0.67% | Calculation of Return on Tangible Common Equity (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net income (loss) available to common stockholders | $(562,792) | $54,773 | $24,740 | | Total adjusted earnings available to common stockholders (non-GAAP) | $67,217 | $58,360 | $48,850 | | Average tangible common stockholders' equity (non-GAAP) | $1,958,160 | $2,132,932 | $2,080,904 | | Return on tangible common equity | -113.56% | 10.73% | 5.27% | | Adjusted return on tangible common equity (non-GAAP) | 13.62% | 10.97% | 9.34% | Calculation of Efficiency Ratio and Adjusted Efficiency Ratio (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Noninterest expense (efficiency ratio numerator) | $142,032 | $138,589 | $137,193 | | Adjusted efficiency ratio numerator | $136,426 | $133,518 | $132,859 | | Efficiency ratio denominator | $(565,715) | $220,600 | $181,240 | | Adjusted efficiency ratio denominator | $236,347 | $220,600 | $209,633 | | Efficiency ratio | -25.11% | 62.82% | 75.70% | | Adjusted efficiency ratio (non-GAAP) | 57.72% | 60.52% | 63.38% | Calculation of Total Revenue and Adjusted Total Revenue (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Total revenue | $(569,526) | $214,178 | $174,842 | | Adjusted total revenue | $232,536 | $214,178 | $203,235 | Calculation of Pre-Provision Net Revenue (PPNR) and Adjusted PPNR (in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Pre-Provision Net Revenue (PPNR) | $(711,558) | $75,589 | $37,649 | | Adjusted Pre-Provision Net Revenue | $92,813 | $77,346 | $66,438 | Reconciliation Of Non-GAAP Financial Measures - Year-to-Date (continued) This section provides year-to-date reconciliations for non-GAAP financial measures, including adjusted return on average assets, return on tangible common equity, adjusted return on average common equity, adjusted return on tangible common equity, efficiency ratio, and adjusted efficiency ratio. It also reconciles total revenue and pre-provision net revenue (PPNR) to their adjusted non-GAAP counterparts Calculation of Adjusted Return on Average Assets (Year-to-Date, in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net income (loss) | $(475,631) | $87,161 | $104,374 | | Adjusted earnings (non-GAAP) | $154,123 | $89,193 | $128,253 | | Average total assets | $26,073,100 | $26,661,787 | $27,260,212 | | Return on average assets | -2.44% | 0.66% | 0.51% | | Adjusted return on average assets (non-GAAP) | 0.79% | 0.67% | 0.63% | Calculation of Return on Tangible Common Equity (Year-to-Date, in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Net income (loss) available to common stockholders | $(475,631) | $87,161 | $104,374 | | Total adjusted earnings available to common stockholders (non-GAAP) | $161,304 | $94,087 | $136,787 | | Average tangible common stockholders' equity (non-GAAP) | $2,078,963 | $2,140,366 | $2,039,912 | | Return on tangible common equity | -30.13% | 8.67% | 7.39% | | Adjusted return on tangible common equity (non-GAAP) | 10.37% | 8.86% | 8.96% | Calculation of Efficiency Ratio and Adjusted Efficiency Ratio (Year-to-Date, in thousands) | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :--- | :--- | :--- | :--- | | Noninterest expense (efficiency ratio numerator) | $425,201 | $283,169 | $416,426 | | Adjusted efficiency ratio numerator | $409,805 | $273,379 | $400,555 | | Efficiency ratio denominator | $(129,124) | $436,591 | $586,532 | | Adjusted efficiency ratio denominator | $672,938 | $436,591 | $614,925 | | Efficiency ratio | -329.30% | 64.86% | 71.00% | | Adjusted efficiency ratio (non-GAAP) | 60.90% | 62.62% | 65.14% |