1st Source (US:SRCE)2025-10-23 20:07Financial Performance - Record quarterly net income of $42.30 million for Q3 2025, up 13.34% from the previous quarter and up 21.06% year-over-year [2] - Diluted net income per common share for Q3 2025 was $1.71, an increase of 13.25% from the previous quarter and 21.28% from Q3 2024 [4] - Net income available to common shareholders reached $42,296,000 in Q3 2025, a 5.2% increase from $37,319,000 in Q2 2025 and a 21.0% increase from $34,937,000 in Q3 2024 [38] - Net income for Q3 2025 was $42,279,000, representing a 21.0% increase from $34,914,000 in Q3 2024 [41] - Basic net income per common share for Q3 2025 was $1.71, up from $1.41 in Q3 2024, reflecting a 21.3% increase [41] Asset and Equity Growth - Total assets increased to $9,033,539,000 in Q3 2025 from $8,962,134,000 in Q2 2025, representing a growth of 1.2% [38] - Total assets as of September 30, 2025, amounted to $9,056,691, a slight decrease from $9,087,162 as of June 30, 2025 [40] - Total equity increased to $1,291,431,000 at the end of Q3 2025, compared to $1,257,424,000 at the end of Q2 2025 [38] - Total shareholders' equity rose to $1,236,472, compared to $1,198,589 in the previous quarter, marking an increase of about 3.2% [40] - Total common shareholders' equity increased to $1,236,472, up from $1,104,253, reflecting a growth of 12% year-over-year [47] Loan and Deposit Trends - Average loans and leases grew by $46.93 million in Q3 2025, up 0.67% from the previous quarter and $409.71 million, or 6.20%, from Q3 2024 [12] - Average deposits increased by $75.03 million in Q3 2025, up 1.02% from the previous quarter and $289.69 million, or 4.06%, from Q3 2024 [13] - Loans and leases at the end of Q3 2025 were $6,964,454,000, a decrease from $7,097,969,000 in Q2 2025 [38] - Net loans and leases decreased to $6,803,024 from $6,934,485 in the previous quarter, reflecting a decline of approximately 1.9% [40] - Total deposits were reported at $7,409,819, down from $7,442,669 in the prior quarter, indicating a decrease of about 0.4% [40] Income and Expense Analysis - Tax-equivalent net interest income for Q3 2025 was $88.90 million, up 4.17% from the previous quarter and 17.55% year-over-year [14] - Net interest income for Q3 2025 was $88,750,000, up 4.3% from $85,192,000 in Q2 2025 and 17.5% from $75,486,000 in Q3 2024 [38] - Noninterest income for Q3 2025 was $21,906,000, down from $23,057,000 in Q2 2025, indicating a decline of 5.0% [38] - Total noninterest expense for Q3 2025 was $54,776,000, an increase of 7.8% from $50,828,000 in Q3 2024 [41] - Noninterest expense for Q3 2025 was $54.78 million, an increase of 4.47% from the prior quarter and 7.77% from Q3 2024 [21] Efficiency and Ratios - The efficiency ratio improved to 49.50% in Q3 2025 from 48.43% in Q2 2025, indicating better cost management [38] - Return on average assets increased to 1.86% in Q3 2025, up from 1.67% in Q2 2025 and 1.59% in Q3 2024 [38] - The net interest margin improved to 4.08% in Q3 2025, compared to 4.00% in Q2 2025 and 3.63% in Q3 2024 [38] - The tangible common equity-to-tangible assets ratio was 12.85% as of September 30, 2025, compared to 11.76% a year earlier [46] - The efficiency ratio (GAAP-derived) improved to 49.63% for the nine months ended September 30, 2025, down from 51.64% in the same period last year [46] Credit Quality - Provision for credit losses was $0.90 million in Q3 2025, a decrease of $6.79 million from the previous quarter [25] - The allowance for loan and lease losses was 2.32% of total loans and leases as of September 30, 2025, up from 2.30% at June 30, 2025 [24] - The provision for credit losses totaled $896,000 in Q3 2025, a decrease from $1,723,000 in Q3 2024, indicating improved credit quality [41]