First Citizens BancShares(FCNCA) - 2025 Q3 - Quarterly Results

Executive Summary & Key Financial Highlights Summary Financial Data The company reported a decrease in net interest income and net income for both the three and nine months ended September 30, 2025, compared to the prior year. Provision for credit losses increased significantly, impacting profitability. Adjusted net income also saw a decline | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Change (YoY) | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------- | :----------------------------- | :----------------------------- | :----------- | | Net interest income | $1,734 | $1,796 | -3.45% | $5,092 | $5,434 | -6.30% | | Provision for credit losses | $191 | $117 | +63.25% | $460 | $276 | +66.67% | | Net income | $568 | $639 | -11.11% | $1,626 | $2,077 | -21.71% | | Net income available to common stockholders | $554 | $624 | -11.22% | $1,583 | $2,031 | -22.06% | | Adjusted net income available to common stockholders | $573 | $660 | -13.18% | $1,679 | $2,168 | -22.55% | Per Share Information Diluted EPS and Adjusted diluted EPS decreased year-over-year for both the three and nine-month periods ended September 30, 2025. Book value and tangible book value per common share increased compared to September 30, 2024 | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Diluted earnings per common share (3M) | $43.08 | $42.36 | $43.42 | -0.78% | | Adjusted diluted EPS (3M) | $44.62 | $44.78 | $45.87 | -2.72% | | Diluted earnings per common share (9M) | $119.70 | N/A | $140.26 | -14.66% | | Adjusted diluted EPS (9M) | $127.03 | N/A | $149.71 | -15.15% | | Book value per common share at period end | $1,672.54 | $1,637.72 | $1,547.81 | +8.06% | | Tangible book value per common share (TBV) at period end | $1,628.64 | $1,594.38 | $1,504.75 | +8.23% | Key Performance Metrics Key profitability ratios such as Return on Average Assets (ROA), Return on Average Common Equity (ROE), and Return on Average Tangible Common Equity (ROTCE) all declined year-over-year. The efficiency ratio worsened, while Net Interest Margin (NIM) also decreased | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Change (YoY) | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------- | :----------------------------- | :----------------------------- | :----------- | | Return on average assets (ROA) | 0.98% | 1.15% | -0.17 pp | 0.95% | 1.27% | -0.32 pp | | Adjusted ROA | 1.01% | 1.22% | -0.21 pp | 1.01% | 1.35% | -0.34 pp | | Return on average common equity (ROE) | 10.26% | 11.30% | -1.04 pp | 9.82% | 12.73% | -2.91 pp | | Adjusted ROE | 10.62% | 11.94% | -1.32 pp | 10.43% | 13.59% | -3.16 pp | | Efficiency ratio | 61.27% | 59.49% | +1.78 pp | 63.12% | 57.38% | +5.74 pp | | Net interest margin (NIM) | 3.26% | 3.53% | -0.27 pp | 3.26% | 3.62% | -0.36 pp | Select Balance Sheet Items at Period End Total loans and leases, total deposits, and total borrowings increased year-over-year as of September 30, 2025. The loan to deposit ratio decreased, while noninterest-bearing deposits remained a significant portion of total deposits | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Total investment securities | $45,124 | $43,346 | $38,663 | +16.72% | | Total loans and leases | $144,758 | $141,269 | $138,695 | +4.37% | | Total deposits | $163,190 | $159,935 | $151,574 | +7.67% | | Total borrowings | $38,675 | $38,112 | $37,161 | +4.07% | | Loan to deposit ratio | 88.71% | 88.33% | 91.50% | -2.79 pp | | Noninterest-bearing deposits to total deposits | 26.20% | 25.56% | 25.99% | +0.21 pp | Capital Ratios at Period End All reported capital ratios, including Total risk-based capital, Tier 1 risk-based capital, Common equity Tier 1, and Tier 1 leverage capital, decreased year-over-year as of September 30, 2025 | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :-------------------------- | :----------- | :----------- | :----------- | :----------- | | Total risk-based capital ratio | 14.05% | 14.25% | 15.36% | -1.31 pp | | Tier 1 risk-based capital ratio | 12.15% | 12.63% | 13.78% | -1.63 pp | | Common equity Tier 1 ratio | 11.65% | 12.12% | 13.24% | -1.59 pp | | Tier 1 leverage capital ratio | 9.34% | 9.62% | 10.17% | -0.83 pp | Asset Quality at Period End Asset quality metrics show an increase in nonaccrual loans to total loans and leases, and a higher net charge-off ratio for the three and nine months ended September 30, 2025, compared to the prior year. The Allowance for Loan and Lease Losses (ALLL) to loans and leases ratio decreased | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Nonaccrual loans at period end | $1,406 | $1,319 | $1,244 | +13.02% | | Ratio of nonaccrual loans to total loans at period end | 0.97% | 0.93% | 0.90% | +0.07 pp | | Net charge-offs (3M) | $(234) | $(119) | $(145) | +61.38% | | Net charge-off ratio (3M) | 0.65% | 0.33% | 0.42% | +0.23 pp | | Net charge-offs (9M) | $(497) | N/A | $(380) | +30.79% | | Net charge-off ratio (9M) | 0.47% | N/A | 0.37% | +0.10 pp | | ALLL to loans ratio at period end | 1.14% | 1.18% | 1.21% | -0.07 pp | | Provision for loan and lease losses (3M) | $214 | $111 | $123 | +73.98% | | Provision for loan and lease losses (9M) | $473 | N/A | $311 | +52.09% | | ALLL at end of period | $1,652 | $1,672 | $1,678 | -1.55% | Detailed Financial Statements Income Statement (GAAP) For the three months ended September 30, 2025, total interest income decreased by 4.46% year-over-year, while total interest expense decreased by 5.89%. Net interest income declined by 3.45%. Noninterest income increased by 7.54%, but noninterest expense rose by 2.40%. The provision for credit losses saw a substantial increase of 63.25%, leading to an 11.11% decrease in net income | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Change (YoY) | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------- | :----------------------------- | :----------------------------- | :----------- | | Total interest income | $2,998 | $3,138 | -4.46% | $8,838 | $9,352 | -5.50% | | Total interest expense | $1,264 | $1,342 | -5.89% | $3,746 | $3,918 | -4.39% | | Net interest income | $1,734 | $1,796 | -3.45% | $5,092 | $5,434 | -6.30% | | Provision for credit losses | $191 | $117 | +63.25% | $460 | $276 | +66.67% | | Noninterest income | $699 | $650 | +7.54% | $2,012 | $1,916 | +5.01% | | Noninterest expense | $1,491 | $1,456 | +2.40% | $4,484 | $4,218 | +6.30% | | Income before income taxes | $751 | $873 | -13.97% | $2,160 | $2,856 | -24.37% | | Net income | $568 | $639 | -11.11% | $1,626 | $2,077 | -21.71% | | Diluted earnings per common share | $43.08 | $43.42 | -0.78% | $119.70 | $140.26 | -14.66% | Balance Sheet (GAAP) As of September 30, 2025, total assets increased by 5.86% year-over-year, driven primarily by growth in investment securities available for sale and loans and leases. Total deposits grew by 7.67%, with interest-bearing deposits increasing more significantly than noninterest-bearing deposits. Total liabilities increased by 6.96%, while total stockholders' equity decreased by 3.69% due to a reduction in additional paid-in capital | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Total assets | $233,488 | $229,653 | $220,567 | +5.86% | | Interest-earning deposits at banks | $24,798 | $26,184 | $25,640 | -3.13% | | Investment securities available for sale | $34,963 | $33,060 | $28,190 | +24.02% | | Loans and leases | $144,758 | $141,269 | $138,695 | +4.37% | | Total deposits | $163,190 | $159,935 | $151,574 | +7.67% | | Noninterest-bearing deposits | $42,752 | $40,879 | $39,396 | +8.52% | | Interest-bearing deposits | $120,438 | $119,056 | $112,178 | +7.36% | | Total borrowings | $38,675 | $38,112 | $37,161 | +4.07% | | Total liabilities | $211,502 | $207,357 | $197,739 | +6.96% | | Total stockholders' equity | $21,986 | $22,296 | $22,828 | -3.69% | Notable Items and Adjusted Financials Impact of Notable Items Notable items, which include infrequent transactions and certain recurring noncash items, had a positive impact on adjusted pre-tax income and net income for the periods presented. The impact on adjusted noninterest income and expense was negative, as these items are typically excluded to enhance comparability | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Change (YoY) | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------- | :----------------------------- | :----------------------------- | :----------- | | Impact of notable items on adjusted noninterest income | $(181) | $(176) | +2.84% | $(502) | $(485) | +3.51% | | Impact of notable items on adjusted noninterest expense | $(212) | $(227) | -6.61% | $(649) | $(667) | -2.70% | | Impact of notable items on adjusted pre-tax income | $31 | $51 | -39.22% | $147 | $182 | -19.23% | | Impact of notable items on adjusted net income | $19 | $36 | -47.22% | $96 | $137 | -29.93% | | Impact of notable items on adjusted diluted EPS | $1.54 | $2.45 | -37.00% | $7.33 | $9.45 | -22.43% | - Notable items are defined as income and expense for infrequent transactions and certain recurring items (typically noncash) that management believes should be excluded from adjusted measures to enhance understanding of operations and comparability to historical periods[4] - Personnel cost includes impairment of internal use software under development in Q3 2025. Other noninterest expense includes an accrual from a vendor dispute and an increase in litigation reserve in Q2 2025, and impairment of capitalized software in Q1 2025[6] Adjusted Income Statement (Non-GAAP) The adjusted income statement, excluding notable items, shows a similar trend to the GAAP statement with declines in net interest income and net income year-over-year. However, the adjusted figures present a slightly better performance in terms of net income and EPS compared to their GAAP counterparts, reflecting the removal of certain negative impacts | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Change (YoY) | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------- | :----------------------------- | :----------------------------- | :----------- | | Net interest income | $1,734 | $1,796 | -3.45% | $5,092 | $5,434 | -6.30% | | Provision for credit losses | $191 | $117 | +63.25% | $460 | $276 | +66.67% | | Noninterest income | $518 | $474 | +9.28% | $1,510 | $1,431 | +5.52% | | Noninterest expense | $1,279 | $1,229 | +4.07% | $3,835 | $3,551 | +8.00% | | Income before income taxes | $782 | $924 | -15.37% | $2,307 | $3,038 | -24.08% | | Net income | $587 | $675 | -12.90% | $1,722 | $2,214 | -22.22% | | Net income available to common stockholders | $573 | $660 | -13.18% | $1,679 | $2,168 | -22.55% | | Diluted earnings per common share | $44.62 | $45.87 | -2.72% | $127.03 | $149.71 | -15.15% | Loan, Deposit, and Credit Quality Analysis Loans and Leases by Class Total loans and leases increased by 4.37% year-over-year to $144,758 million as of September 30, 2025. Commercial loans, particularly Global fund banking and Commercial construction, showed significant growth, while Investor dependent loans decreased. Consumer loans remained relatively stable | Loan Class | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Commercial construction | $5,926 | $5,714 | $4,924 | +20.35% | | Owner occupied commercial mortgages | $17,232 | $17,053 | $16,372 | +5.25% | | Non-owner occupied commercial mortgages | $15,645 | $16,100 | $16,078 | -2.69% | | Commercial and industrial | $41,172 | $40,658 | $40,043 | +2.82% | | Global fund banking | $31,615 | $28,677 | $27,114 | +16.60% | | Investor dependent | $2,772 | $2,777 | $3,562 | -22.20% | | Total commercial | $116,428 | $113,007 | $110,113 | +5.73% | | Total consumer | $28,330 | $28,262 | $28,582 | -0.88% | | Total loans and leases | $144,758 | $141,269 | $138,695 | +4.37% | - During Q2 2025, loan classes from the SVB portfolio were recast to the Commercial portfolio. Global fund banking remained separate but under Commercial. Investor dependent–early stage and growth stage were combined into a single investor dependent class under Commercial. Cash flow dependent and innovation C&I were combined with the commercial and industrial loan class under Commercial[11][12] Deposits by Type Total deposits increased by 7.67% year-over-year to $163,190 million as of September 30, 2025. Savings and Money market deposits showed strong growth, while Time deposits experienced a significant decrease | Deposit Type | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :-------------------------- | :----------- | :----------- | :----------- | :----------- | | Noninterest-bearing demand | $42,752 | $40,879 | $39,396 | +8.52% | | Checking with interest | $23,731 | $23,283 | $23,216 | +2.22% | | Money market | $38,718 | $37,654 | $34,574 | +11.99% | | Savings | $46,915 | $46,877 | $40,259 | +16.53% | | Time | $11,074 | $11,242 | $14,129 | -21.55% | | Total deposits | $163,190 | $159,935 | $151,574 | +7.67% | Credit Quality and Allowance for Loan and Lease Losses (ALLL) Nonaccrual loans increased by 13.02% year-over-year, and the ratio of nonaccrual loans to total loans rose to 0.97% as of September 30, 2025. Net charge-offs significantly increased for both the three and nine-month periods, leading to a higher net charge-off ratio. The ALLL to loans ratio decreased, while the provision for loan and lease losses increased | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Nonaccrual loans at period end | $1,406 | $1,319 | $1,244 | +13.02% | | Ratio of nonaccrual loans to total loans at period end | 0.97% | 0.93% | 0.90% | +0.07 pp | | Net charge-offs (3M) | $(234) | $(119) | $(145) | +61.38% | | Net charge-off ratio (3M) | 0.65% | 0.33% | 0.42% | +0.23 pp | | Net charge-offs (9M) | $(497) | N/A | $(380) | +30.79% | | Net charge-off ratio (9M) | 0.47% | N/A | 0.37% | +0.10 pp | | ALLL to loans ratio at period end | 1.14% | 1.18% | 1.21% | -0.07 pp | | Provision for loan and lease losses (3M) | $214 | $111 | $123 | +73.98% | | Provision for loan and lease losses (9M) | $473 | N/A | $311 | +52.09% | | ALLL at end of period | $1,652 | $1,672 | $1,678 | -1.55% | Net Interest Income and Margin Analysis Average Balance Sheets, Yields and Rates (Three Months Ended) For the three months ended September 30, 2025, average interest-earning assets increased by 4.37% year-over-year, but the overall yield decreased. Average interest-bearing liabilities also increased, while the cost of interest-bearing deposits decreased. Net interest income declined, and both net interest spread and net interest margin compressed | Metric | Sep 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | | Average interest-earning assets | $211,042 | $202,199 | +4.37% | | Yield on total interest-earning assets | 5.64% | 6.18% | -0.54 pp | | Average interest-bearing deposits | $120,575 | $112,446 | +7.23% | | Cost of total interest-bearing deposits | 3.00% | 3.55% | -0.55 pp | | Average total borrowings | $38,258 | $37,448 | +2.16% | | Cost of total borrowings | 3.70% | 3.61% | +0.09 pp | | Net interest income | $1,734 | $1,796 | -3.45% | | Net interest spread | 2.48% | 2.61% | -0.13 pp | | Net interest margin | 3.26% | 3.53% | -0.27 pp | Average Balance Sheets, Yields and Rates (Nine Months Ended) For the nine months ended September 30, 2025, average interest-earning assets increased by 3.96% year-over-year, but the overall yield decreased. Average interest-bearing liabilities increased, while the cost of interest-bearing deposits decreased. Net interest income declined, and both net interest spread and net interest margin compressed significantly | Metric | Sep 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | | Average interest-earning assets | $208,432 | $200,503 | +3.96% | | Yield on total interest-earning assets | 5.66% | 6.22% | -0.56 pp | | Average interest-bearing deposits | $118,806 | $110,478 | +7.54% | | Cost of total interest-bearing deposits | 3.04% | 3.51% | -0.47 pp | | Average total borrowings | $38,015 | $37,502 | +1.37% | | Cost of total borrowings | 3.67% | 3.59% | +0.08 pp | | Net interest income | $5,092 | $5,434 | -6.30% | | Net interest spread | 2.47% | 2.69% | -0.22 pp | | Net interest margin | 3.26% | 3.62% | -0.36 pp | Non-GAAP Reconciliations Net Income and EPS Reconciliation The reconciliation shows that adjusted net income and adjusted diluted EPS are consistently higher than their GAAP counterparts due to the exclusion of notable items. For the nine months ended September 30, 2025, adjusted net income was $1,722 million compared to GAAP net income of $1,626 million | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net income (GAAP) | $568 | $639 | $1,626 | $2,077 | | Adjusted net income (non-GAAP) | $587 | $675 | $1,722 | $2,214 | | Net income available to common stockholders (GAAP) | $554 | $624 | $1,583 | $2,031 | | Adjusted net income available to common stockholders (non-GAAP) | $573 | $660 | $1,679 | $2,168 | | Diluted EPS (GAAP) | $43.08 | $43.42 | $119.70 | $140.26 | | Adjusted diluted EPS (non-GAAP) | $44.62 | $45.87 | $127.03 | $149.71 | Noninterest Income and Expense Reconciliation Adjusted noninterest income and expense are derived by excluding the impact of notable items from their GAAP counterparts. For the three months ended September 30, 2025, adjusted noninterest income was $518 million, lower than GAAP noninterest income of $699 million, while adjusted noninterest expense was $1,279 million, lower than GAAP noninterest expense of $1,491 million | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Noninterest income (GAAP) | $699 | $650 | $2,012 | $1,916 | | Adjusted noninterest income (non-GAAP) | $518 | $474 | $1,510 | $1,431 | | Noninterest expense (GAAP) | $1,491 | $1,456 | $4,484 | $4,218 | | Adjusted noninterest expense (non-GAAP) | $1,279 | $1,229 | $3,835 | $3,551 | Pre-Tax, Pre-Provision Net Revenue (PPNR) Reconciliation PPNR and Adjusted PPNR both show a decline year-over-year for the three and nine-month periods ended September 30, 2025. Adjusted PPNR consistently exceeds GAAP PPNR due to the exclusion of notable items | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | PPNR (non-GAAP) | $942 | $990 | $2,620 | $3,132 | | Adjusted PPNR (non-GAAP) | $973 | $1,041 | $2,767 | $3,314 | Return on Assets (ROA) Reconciliation Both GAAP ROA and Adjusted ROA declined year-over-year for the three and nine-month periods ended September 30, 2025, reflecting lower net income relative to average assets. Adjusted ROA consistently remained slightly higher than GAAP ROA | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | ROA (GAAP) | 0.98% | 1.15% | 0.95% | 1.27% | | Adjusted ROA (non-GAAP) | 1.01% | 1.22% | 1.01% | 1.35% | | PPNR ROA (non-GAAP) | 1.62% | 1.79% | 1.54% | 1.91% | | Adjusted PPNR ROA (non-GAAP) | 1.67% | 1.88% | 1.62% | 2.03% | Return on Equity (ROE) and Return on Tangible Common Equity (ROTCE) Reconciliation ROE and ROTCE, both GAAP and adjusted, decreased year-over-year for the three and nine-month periods ended September 30, 2025. Adjusted ROTCE consistently showed the highest return among these metrics, reflecting the exclusion of intangible assets | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | ROE (GAAP) | 10.26% | 11.30% | 9.82% | 12.73% | | Adjusted ROE (non-GAAP) | 10.62% | 11.94% | 10.43% | 13.59% | | ROTCE (non-GAAP) | 10.53% | 11.63% | 10.09% | 13.12% | | Adjusted ROTCE (non-GAAP) | 10.91% | 12.29% | 10.71% | 14.00% | Tangible Common Equity and Book Value Reconciliations Tangible common equity and tangible book value per common share increased year-over-year as of September 30, 2025. The tangible common equity to tangible assets ratio decreased, indicating a slight shift in asset composition or capital structure | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | Change (YoY) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Tangible common equity (non-GAAP) | $20,551 | $20,848 | $21,336 | -3.68% | | Tangible common equity to tangible assets (non-GAAP) | 8.82% | 9.10% | 9.70% | -0.88 pp | | Book value per share (GAAP) | $1,672.54 | $1,637.72 | $1,547.81 | +8.06% | | Tangible book value per common share (non-GAAP) | $1,628.64 | $1,594.38 | $1,504.75 | +8.23% | Efficiency Ratio Reconciliation Both the GAAP efficiency ratio and the adjusted efficiency ratio worsened (increased) year-over-year for the three and nine-month periods ended September 30, 2025, indicating higher expenses relative to revenue. The adjusted efficiency ratio consistently remained lower than the GAAP ratio | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Efficiency ratio (GAAP) | 61.27% | 59.49% | 63.12% | 57.38% | | Adjusted efficiency ratio (non-GAAP) | 56.78% | 54.15% | 58.08% | 51.72% | Net Interest Income and Net Interest Margin Reconciliation Net interest income and Net Interest Margin (NIM), both GAAP and excluding Purchase Accounting Accretion (PAA), decreased year-over-year. The exclusion of PAA consistently resulted in a lower NIM, indicating that PAA contributed positively to the reported NIM | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net interest income (GAAP) | $1,734 | $1,796 | $5,092 | $5,434 | | PAA | $61 | $101 | $202 | $399 | | Net interest income, excluding PAA (non-GAAP) | $1,673 | $1,695 | $4,890 | $5,035 | | NIM (GAAP) | 3.26% | 3.53% | 3.26% | 3.62% | | NIM, excluding PAA (non-GAAP) | 3.15% | 3.33% | 3.13% | 3.35% | Income Tax Expense Reconciliation Adjusted income tax expense, which includes the impact of notable items, was higher than GAAP income tax expense for all periods presented. This indicates that notable items generally reduced the tax benefit or increased the tax liability | Metric | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Income tax expense (GAAP) | $183 | $234 | $534 | $779 | | Impact of notable items | $12 | $15 | $51 | $45 | | Adjusted income tax expense (non-GAAP) | $195 | $249 | $585 | $824 |