Associated Banc-p(US:ASB)2025-10-28 20:24Financial Performance - Net income for the quarter ended September 30, 2025, was $337.6 million, compared to $284.8 million for the same period in 2024 [184]. - Earnings per common share (basic) increased to $1.98 from $1.83 year-over-year [184]. - Return on average assets improved to 1.04% from 0.93% year-over-year [184]. - The efficiency ratio improved to 56.67% from 59.86% year-over-year, indicating better cost management [184]. - The Corporation's net income for the quarter ended September 30, 2025, was $337,648 thousand, compared to $284,760 thousand for the same period in 2024, reflecting a year-over-year increase of 18.5% [277]. - Adjusted net income available to common equity for the quarter was $333,979 thousand, up from $281,091 thousand in the previous year [277]. Loan and Deposit Growth - Average loans increased by $925.5 million, or 3%, to $30.5 billion, driven by commercial and business lending and auto finance loans [183]. - Average deposits rose by $1.5 billion, or 5%, to $34.6 billion, with increases in all deposit types except money market and brokered CDs [183]. - Total loans amounted to $30,750,460 thousand with a net interest margin of 5.50% for the quarter [188]. - Total deposits reached $34.88 billion as of September 30, 2025, representing an increase of $1.3 billion, or 4%, from $33.55 billion a year ago [243]. - The total loan balance as of September 30, 2025, was $30.95 billion, up from $29.99 billion a year earlier, indicating a growth of approximately 3.2% [237]. Interest Income and Expenses - Net interest income increased by $114.2 million, or 15%, to $891.2 million, with a net interest margin of 3.02%, up from 2.77% [183]. - Noninterest income rose by $9.7 million, or 5%, to $207.0 million, primarily due to increased capital markets revenue [183]. - Noninterest expense increased by $42.1 million, or 7%, to $636.2 million, driven by higher personnel expenses and increased healthcare costs [183]. - Fully tax-equivalent net interest income increased by $115.7 million, or 15%, compared to the first nine months of 2024 [193]. - Noninterest income for the nine months ended September 30, 2025, was $207,019 thousand, reflecting a 5% increase compared to $197,365 thousand in the same period last year [192]. Credit Quality and Loss Provisions - Provision for credit losses decreased to $47.0 million from $68.0 million, reflecting nominal credit movement and macroeconomic trends [183]. - The provision for loan losses for the year-to-date period was $49.5 million, down from $67 million in the same period last year, indicating a decrease of approximately 26% [237]. - Nonperforming assets (NPAs) totaled $136,236,000 as of September 30, 2025, a decrease from $148,169,000 on June 30, 2025 [228]. - The allowance for credit losses on loans increased to $414.6 million as of September 30, 2025, compared to $397.5 million a year earlier, reflecting a year-over-year increase of 4% [237]. - The total net charge-offs for the year-to-date period were $34.7 million, a decrease of 38% from $56.3 million in the same period last year [239]. Asset and Capital Management - Total assets reached $44,015,203 thousand, up from $43,420,063 thousand in the previous quarter [188]. - The Corporation's CET1 capital ratio is 10.33%, up from 10.20% in the previous quarter [272]. - Total capital increased to $4,488,957 thousand as of September 30, 2025, compared to $4,394,367 thousand in the previous quarter [272]. - The total risk-weighted assets amounted to $34,688,358 thousand, an increase from $34,241,408 thousand in the previous quarter [272]. - The Corporation's interest rate risk profile is asset sensitive as of September 30, 2025, with a 100 basis point increase in interest rates expected to increase earnings by 1.1% [262]. Loan Portfolio Composition - Total commercial loans amounted to $19,453,145 thousand in 2025, with an interest income of $955,197 thousand, yielding an average rate of 6.56% [186]. - Total consumer loans reached $11,000,345 thousand in 2025, generating an interest income of $383,113 thousand, with an average yield of 4.65% [186]. - Floating rate loans accounted for $21.2 billion, or 69% of total loans outstanding, with 90% of commercial loans being floating rate [208]. - The loan portfolio is diversified, with no significant concentrations exceeding 10% of total loan exposure as of September 30, 2025 [210]. - Residential mortgage loans made up 22% of total loans, totaling $6,858,285 thousand, showing a decrease from 26% in September 2024 [204]. Regulatory Compliance and Risk Management - The Corporation's maximum acceptable loan-to-value (LTV) ratio for home equity lines of credit is set at 90% [224]. - The assessment of overall capital adequacy considers factors such as asset quality, liquidity, and economic conditions [269]. - Compliance with regulatory minimum capital requirements is a tool for assessing capital adequacy but does not determine performance under extreme stress [270]. - The Corporation employs detailed underwriting procedures and periodic reviews to manage credit risk effectively [209]. - The Corporation's credit risk management includes ongoing review of loan payment performance and borrower creditworthiness [234].