Bank First(US:BFC)2025-10-21 20:01markdown [Executive Summary](index=1&type=section&id=Executive%20Summary) Bank First reported strong financial performance in Q3 and YTD 2025, driven by increased net income and EPS, loan growth, and improved yields, despite merger-related expenses [Q3 and YTD 2025 Financial Highlights](index=1&type=section&id=Q3%20and%20YTD%202025%20Financial%20Highlights) Bank First reported increased net income and earnings per share (EPS) for both the third quarter and nine months ended September 30, 2025 Adjusted net income and EPS also showed growth, demonstrating strong performance despite one-time acquisition-related expenses | Metric | Q3 2025 | Q3 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------- | :------- | | Net Income (GAAP) | $18.0M | $16.6M | $53.1M | $48.0M | | EPS (GAAP) | $1.83 | $1.65 | $5.36 | $4.75 | | Adjusted Net Income (Non-GAAP) | $18.8M | $16.5M | $53.8M | $47.6M | | Adjusted EPS (Non-GAAP) | $1.91 | $1.65 | $5.42 | $4.71 | | Annualized Return on Average Assets | 1.64% | - | 1.61% | - | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) The Chairman and CEO, Mike Molepske, expressed satisfaction with the nearly 13% increase in year-to-date EPS, attributing this growth to mid-single-digit loan expansion and improved loan yields from repricing, with expectations for continued yield boosts - Earnings per share through the first three quarters of 2025 increased by nearly **13%** compared to the same period last year[3](index=3&type=chunk) - The Bank incurred over **\$891,000** in merger expenses related to the acquisition of First National Bank & Trust in Beloit, Wisconsin, scheduled to close on January 1, 2026[3](index=3&type=chunk) - Continued growth in earnings was driven by mid-single-digit loan expansion and an increase in loan yields due to repricing, which is expected to continue boosting loan portfolio yields[3](index=3&type=chunk) [Operating Performance](index=1&type=section&id=Operating%20Performance) Operating performance improved with increased net interest income and margin, driven by loan growth and yield improvements, while managing credit losses and noninterest expenses [Net Interest Income and Margin](index=1&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest income (NII) and net interest margin (NIM) both improved in Q3 2025, driven by higher yields on the loan portfolio from new originations and renewals, coupled with a decline in the average rate paid on interest-bearing liabilities due to CD repricing | Metric | Q3 2025 | Q2 2025 | Q3 2024 | | :---------------- | :------ | :------ | :------ | | Net Interest Income | $38.3M | $36.7M | $35.9M | | Net Interest Margin | 3.88% | 3.72% | 3.76% | - The average rate earned on the Bank's loan portfolio increased by **10 basis points** compared to the prior quarter, due to yields on newly originated loans exceeding the portfolio average and strong yield improvements on renewed maturing loans[6](index=6&type=chunk) - Repricing of maturing certificates of deposit led to a **7 basis point** decline in the average rate paid on the Bank's interest-bearing liabilities[6](index=6&type=chunk) [Provision for Credit Losses](index=2&type=section&id=Provision%20for%20Credit%20Losses) The provision for credit losses increased in Q3 2025 and YTD 2025, primarily as a result of growth in the loan portfolio, while the Bank maintained strong asset quality metrics with negligible net loan losses | Period | Provision for Credit Losses | | :----- | :-------------------------- | | Q3 2025 | $0.7M | | Q2 2025 | $0.2M | | Q3 2024 | $0M | | YTD 2025 | $1.3M | | YTD 2024 | $0.2M | - Provision expense recorded during the third quarter of 2025 was the result of increasing balances in the Bank's loan portfolio[7](index=7&type=chunk) - The Bank experienced negligible net loan losses during the quarter, and its asset quality metrics remain strong[7](index=7&type=chunk) [Noninterest Income Analysis](index=2&type=section&id=Noninterest%20Income%20Analysis) Noninterest income increased in Q3 2025, driven by higher contributions from the investment in Ansay & Associates, increased gains from mortgage loan sales, and a positive valuation adjustment to mortgage servicing rights | Metric | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :------ | :------ | :------ | | Noninterest Income | $6.0M | $4.9M | $4.9M | | Income from Ansay & Associates | $1.3M | $1.2M | $1.1M | | Gains on sales of mortgage loans | $0.5M | $0.3M | $0.4M | | Mortgage servicing rights valuation | +$0.3M | -$0.1M | -$0.3M | [Noninterest Expense Analysis](index=2&type=section&id=Noninterest%20Expense%20Analysis) Noninterest expense saw a slight increase in Q3 2025, primarily due to a significant rise in outside service fees related to the Centre 1 Bancorp, Inc. acquisition, while personnel and occupancy expenses were well-managed or decreased | Metric | Q3 2025 | Q2 2025 | Q3 2024 | | :---------------- | :------ | :------ | :------ | | Noninterest Expense | $21.1M | $20.8M | $20.1M | | Outside Service Fees | $1.8M | $1.1M | $1.1M | | Personnel Expense | Up 0.7% QoQ | - | Up 3.8% YoY | | Occupancy, Equipment, Office | $1.6M | $2.0M | $1.6M | - Outside service fees related to the acquisition of Centre 1 Bancorp, Inc. totaled **\$0.9 million** during the third quarter of 2025[9](index=9&type=chunk) [Balance Sheet and Asset Quality](index=2&type=section&id=Balance%20Sheet%20and%20Asset%20Quality) The balance sheet shows growth in total assets and loans, with stable deposit trends and maintained strong asset quality despite a slight increase in nonperforming assets [Balance Sheet Overview](index=2&type=section&id=Balance%20Sheet%20Overview) Total assets at September 30, 2025, increased year-over-year but experienced a slight decline from the end of the previous fiscal year | Metric | Sep 30, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :----------- | :----------- | :----------- | :----------- | | Total Assets | $4.42B | $4.49B | $4.29B | | Change from Dec 31, 2024 | -$74.6M | - | - | | Change from Sep 30, 2024 | +$125.9M | - | - | [Loan and Deposit Trends](index=3&type=section&id=Loan%20and%20Deposit%20Trends) Total loans continued to grow, with an annualized pace of 5.5% in Q3 2025, while total deposits showed a year-over-year increase, with noninterest-bearing demand deposits maintaining a significant proportion | Metric | Sep 30, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Total Loans | $3.63B | $3.52B | $3.47B | | Total Deposits | $3.54B | $3.66B | $3.48B | | Noninterest-bearing demand deposits | 28.2% of total | 28.0% of total | 29.3% of total | - Total loans grew at an annualized pace of **5.5%** during the third quarter of 2025[11](index=11&type=chunk) [Asset Quality Metrics](index=3&type=section&id=Asset%20Quality%20Metrics) Nonperforming assets increased slightly at September 30, 2025, compared to prior periods, but remained at a negligible level relative to total assets | Metric | Sep 30, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Nonperforming Assets | $13.9M | $9.2M | $11.9M | | Nonperforming Assets to Total Assets | 0.31% | 0.21% | 0.28% | [Capital and Shareholder Returns](index=3&type=section&id=Capital%20and%20Shareholder%20Returns) Capital position saw minor fluctuations due to dividends and share repurchases, while the Board declared a quarterly cash dividend [Capital Position](index=3&type=section&id=Capital%20Position) Stockholders' equity decreased slightly due to dividends and share repurchases outpacing earnings for the first nine months of 2025, while book value and tangible book value per common share showed minor fluctuations | Metric | Sep 30, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Stockholders' Equity | $628.1M | $639.7M | $628.9M | | Book Value per Common Share | $63.87 | $63.89 | $62.82 | | Tangible Book Value per Common Share (non-GAAP) | $44.30 | $44.28 | $43.07 | - Dividends (**\$48.1 million**, including a **\$3.50** special dividend) and repurchases of BFC common stock (**\$22.0 million**) outpaced earnings (**\$53.1 million**) through the first nine months of 2025, causing the decline in capital[14](index=14&type=chunk) [Dividend Declaration](index=3&type=section&id=Dividend%20Declaration) Bank First's Board of Directors approved a quarterly cash dividend of $0.45 per common share, payable in January 2026 - Bank First's Board of Directors approved a quarterly cash dividend of **\$0.45** per common share[15](index=15&type=chunk) - The dividend is payable on January 7, 2026, to shareholders of record as of December 24, 2025[15](index=15&type=chunk) [Company Profile](index=3&type=section&id=Company%20Profile) Bank First Corporation, established in 1894, provides comprehensive financial services through its subsidiary, Bank First, N.A., operating 27 banking locations in Wisconsin [Bank First Corporation Overview](index=3&type=section&id=Bank%20First%20Corporation%20Overview) Bank First Corporation, established in 1894, provides comprehensive financial services through its subsidiary, Bank First, N.A., operating 27 banking locations in Wisconsin with approximately $4.4 billion in assets and 366 full-time equivalent staff, growing through both acquisitions and de novo branch expansion - Bank First Corporation provides financial services through its subsidiary, Bank First, N.A., incorporated in 1894[16](index=16&type=chunk) - The Bank offers loan, deposit, and treasury management products at its **27** banking locations in Wisconsin[16](index=16&type=chunk) - The Bank has approximately **\$4.4 billion** in assets and employs about **366** full-time equivalent staff, with growth achieved through acquisitions and de novo branch expansion[16](index=16&type=chunk) [Important Disclosures](index=3&type=section&id=Important%20Disclosures) This section provides important disclosures regarding forward-looking statements and the use of non-GAAP financial measures, highlighting inherent uncertainties and analytical limitations [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This press release contains forward-looking statements regarding future performance, growth, and acquisitions, which are inherently uncertain and subject to various risks and assumptions that could cause actual results to differ materially from expectations - Forward-looking statements relate to timing, benefits, costs, and synergies of mergers, projected growth, anticipated future financial performance, financial condition, credit quality, and management's long-term performance goals[18](index=18&type=chunk) - These statements are not historical facts and are based on current expectations, estimates, and projections, many of which are inherently uncertain and beyond Bank First's control[19](index=19&type=chunk) - Factors that could cause actual results to differ materially include business and economic conditions, changes in government interest rate policies, ability to manage problem credits, risks of future acquisitions, and general competitive, economic, political, and market conditions[19](index=19&type=chunk) [Non-GAAP Financial Measures Explanation](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) The report includes non-GAAP financial measures, such as tangible book value per common share, which management uses to evaluate financial condition and capital strengths, but advises that these measures should not be considered in isolation from GAAP results - The communication contains non-GAAP financial measures, such as tangible book value per common share and tangible common equity to tangible assets[20](index=20&type=chunk) - Management believes these measures are helpful to management, investors, and others in understanding Bank First's results of operations or financial position[20](index=20&type=chunk) - Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of results as reported under GAAP[20](index=20&type=chunk) [Financial Statements (Unaudited)](index=5&type=section&id=Financial%20Statements%20(Unaudited)) This section presents unaudited consolidated financial statements, including results of operations, period-end balances, average balances, and key financial ratios [Consolidated Financial Summary](index=5&type=section&id=Consolidated%20Financial%20Summary) This section provides a comprehensive unaudited consolidated financial summary, detailing results of operations, period-end balances, average balances, key financial ratios, loan portfolio composition, share repurchases, and non-GAAP financial reconciliations across multiple reporting periods [Results of Operations](index=5&type=section&id=Results%20of%20Operations) | Metric (in thousands) | 3 Months Ended Sep 30, 2025 | 3 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2025 | 9 Months Ended Sep 30, 2024 | | :-------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Interest income | $55,456 | $54,032 | $165,079 | $152,651 | | Interest expense | $17,203 | $18,149 | $53,587 | $50,412 | | Net interest income | $38,253 | $35,883 | $111,492 | $102,239 | | Provision for credit losses | $650 | $0 | $1,250 | $200 | | Noninterest income | $5,953 | $4,893 | $17,462 | $15,167 | | Noninterest expense | $21,086 | $20,100 | $62,446 | $59,481 | | Net income | $17,990 | $16,552 | $53,106 | $48,023 | | EPS (Basic and Diluted) | $1.83 | $1.65 | $5.36 | $4.75 | [Period-End Balances](index=5&type=section&id=Period-End%20Balances) | Metric (in thousands) | Sep 30, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Total assets | $4,420,411 | $4,495,060 | $4,294,498 | | Total loans | $3,629,663 | $3,517,168 | $3,470,920 | | Total deposits | $3,538,761 | $3,661,073 | $3,484,741 | | Stockholders' equity | $628,125 | $639,683 | $628,895 | | Book value per common share | $63.87 | $63.89 | $62.82 | | Tangible book value per common share (non-GAAP) | $44.30 | $44.28 | $43.07 | [Average Balances and Financial Ratios](index=5&type=section&id=Average%20Balances%20and%20Financial%20Ratios) | Metric | 3 Months Ended Sep 30, 2025 | 3 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2025 | 9 Months Ended Sep 30, 2024 | | :-------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Average total assets | $4,350,555 | $4,231,112 | $4,418,310 | $4,157,121 | | Average loans | $3,600,259 | $3,450,423 | $3,567,946 | $3,402,001 | | Average deposits | $3,573,341 | $3,435,172 | $3,613,685 | $3,427,741 | | Return on average assets | 1.64% | 1.56% | 1.61% | 1.54% | | Return on average common equity | 11.51% | 10.61% | 11.27% | 10.43% | | Net interest margin, taxable equivalent | 3.88% | 3.76% | 3.75% | 3.67% | | Nonperforming assets to total assets | 0.31% | 0.28% | 0.31% | 0.28% | [Loan Portfolio Composition](index=6&type=section&id=Loan%20Portfolio%20Composition) | Loan Category (in thousands) | Sep 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | | Commercial/industrial | $654,452 | $517,816 | | Commercial real estate - owner occupied | $861,650 | $938,730 | | Commercial real estate - non-owner occupied | $510,535 | $463,323 | | Multi-family | $372,031 | $329,458 | | Construction and development | $262,439 | $246,445 | | Residential 1-4 family | $897,518 | $904,273 | | Consumer and other | $71,038 | $70,875 | | **Total Loans** | **$3,629,663** | **$3,470,920** | [Share Repurchases](index=6&type=section&id=Share%20Repurchases) | Period | Total Number of Shares Repurchased | Total Dollar of Shares Repurchased (in thousands) | | :----- | :--------------------------------- | :---------------------------------------------- | | Q3 2025 | - | $0 | | Q2 2025 | 143,720 | $15,622 | | Q1 2025 | 61,882 | $6,381 | | YTD 2025 | 205,602 | $22,003 | | YTD 2024 | 372,402 | $31,227 | [Non-GAAP Reconciliations](index=6&type=section&id=Non-GAAP%20Reconciliations) | Metric (in thousands) | 3 Months Ended Sep 30, 2025 | 9 Months Ended Sep 30, 2025 | | :-------------------------------- | :-------------------------- | :-------------------------- | | Net income (GAAP) | $17,990 | $53,106 | | Acquisition related expenses | $862 | $862 | | Gains on sales of securities and OREO valuations | ($159) | ($159) | | Adjusted net income (non-GAAP) | $18,778 | $53,768 | | Adjusted earnings per share (non-GAAP) | $1.91 | $5.42 | | Tangible book value per common share (non-GAAP) | $44.30 | $44.30 | | Tangible equity to tangible assets (non-GAAP) | 10.30% | 10.30% | - The consolidated financial summary provides unaudited data for results of operations, period-end balances, average balances, and financial ratios[22](index=22&type=chunk) - It includes detailed breakdowns of the loan portfolio composition and share repurchase activities[23](index=23&type=chunk) - Non-GAAP financial measures are reconciled to their GAAP equivalents, including adjusted net income, adjusted EPS, and tangible book values[23](index=23&type=chunk) [Average Assets, Liabilities, and Rates Earned/Paid](index=7&type=section&id=Average%20Assets,%20Liabilities,%20and%20Rates%20Earned/Paid) This section provides detailed tables on the average balances of assets, liabilities, and stockholders' equity, along with the average interest income/expense and rates earned or paid for various categories of interest-earning assets and interest-bearing liabilities for both quarterly and year-to-date periods [Three Months Ended September 30, 2025 vs 2024](index=7&type=section&id=Three%20Months%20Ended%20September%2030,%202025%20vs%202024) | Metric | Q3 2025 Average Balance (in thousands) | Q3 2025 Rate | Q3 2024 Average Balance (in thousands) | Q3 2024 Rate | | :-------------------------------- | :----------------------------------- | :----------- | :----------------------------------- | :----------- | | Total interest-earning assets | $3,948,304 | 5.61% | $3,833,968 | 5.64% | | Total interest-bearing liabilities | $2,709,808 | 2.52% | $2,583,382 | 2.79% | | Net interest spread | - | 3.09% | - | 2.85% | | Net interest margin | - | 3.88% | - | 3.76% | [Nine Months Ended September 30, 2025 vs 2024](index=8&type=section&id=Nine%20Months%20Ended%20September%2030,%202025%20vs%202024) | Metric | YTD 2025 Average Balance (in thousands) | YTD 2025 Rate | YTD 2024 Average Balance (in thousands) | YTD 2024 Rate | | :-------------------------------- | :----------------------------------- | :----------- | :----------------------------------- | :----------- | | Total interest-earning assets | $4,018,150 | 5.53% | $3,757,468 | 5.46% | | Total interest-bearing liabilities | $2,769,379 | 2.59% | $2,521,031 | 2.67% | | Net interest spread | - | 2.95% | - | 2.79% | | Net interest margin | - | 3.75% | - | 3.67% | - Detailed breakdown of average balances and rates for interest-earning assets (loans, securities, cash) and interest-bearing liabilities (deposits, borrowed funds) is provided[24](index=24&type=chunk)[26](index=26&type=chunk) - Includes calculations for net interest spread and net interest margin on a fully taxable equivalent basis[24](index=24&type=chunk)[26](index=26&type=chunk)