Financial Performance - Third quarter 2025 net income was $54.7 million, a decrease of $6.6 million, or 11%, compared to the third quarter of 2024, but an increase of $16.7 million, or 44%, compared to the second quarter of 2025[1][2][4][5] - Diluted earnings per common share for the third quarter 2025 was $0.97, down 17% from $1.17 in the third quarter of 2024, but up 62% from $0.60 in the second quarter of 2025[1][2] - Net income for Q3 2025 was $54,701 thousand, representing a 44% increase from Q2 2025, but an 11% decrease from Q3 2024[50] - Net income for the nine months ended September 30, 2025, was $150,921,000, a decrease of 33% compared to $224,720,000 for the same period in 2024[55] - Total income for the nine months ended September 30, 2025, was $496,160,000, reflecting a 4% increase from $476,963,000 in 2024[55] Asset and Deposit Growth - Total assets reached a record-high of $19.4 billion, increasing by $213.4 million, or 1%, from June 30, 2025, and by $548.9 million, or 3%, from December 31, 2024[1][7] - Total deposits increased by $1.2 billion, or 10%, compared to June 30, 2025, and by $2.0 billion, or 17%, compared to December 31, 2024[1][16] - Total assets as of September 30, 2025, reached $19,354,647 million, up from $19,141,204 million as of June 30, 2025[60] - Total deposits, including all categories, reached $1,393.47 billion, up from $1,268.68 billion, representing a 9.8% increase[67] Loan and Credit Quality - The provision for credit losses decreased by 45%, or $23.8 million, with loans receivable classified as special mention declining by 9% to $155.7 million compared to June 30, 2025[1][9][12] - The allowance for credit losses on loans was $93.3 million, reflecting a 2% increase from June 30, 2025, and an 11% increase from December 31, 2024[1][9] - Total nonperforming loans were $298,268 million as of September 30, 2025, an increase from $251,532 million in the previous quarter[65] - Delinquent loans to total loans ratio was 2.28% as of September 30, 2025, compared to 1.91% in the previous quarter[65] Income and Expense Analysis - Noninterest income rose to $43.0 million, an increase of $26.3 million, or 157%, compared to $16.7 million, driven by significant growth in loan servicing fees and gains on loan sales[1][26] - Total noninterest expense for Q3 2025 was $77,250 thousand, showing a 26% increase from Q3 2024[50] - Noninterest income decreased by 15% to $43,014 thousand from Q2 2025, but increased by 157% compared to Q3 2024[50] - Noninterest income rose by 32% year-over-year to $117,187,000, compared to $88,967,000 in 2024[55] Efficiency and Return Metrics - The efficiency ratio for Q3 2025 was 45.16%, an increase of 200 basis points from Q2 2025 and 416 basis points from Q3 2024[50] - Return on average assets for Q3 2025 was 1.16%, an increase of 36 basis points from Q2 2025, but a decrease of 18 basis points from Q3 2024[50] - Return on average tangible common shareholders' equity decreased by 1,006 basis points to 9.33% compared to 19.39% in the previous year[55] Strategic Initiatives and Future Outlook - The company plans to expand its market presence through strategic acquisitions and new product offerings in the upcoming quarters[67] - Future guidance indicates a focus on enhancing user data analytics to drive customer engagement and retention[67] - The company is investing in new technologies to improve operational efficiency and customer service capabilities[67]
Merchants Bancorp(MBINL) - 2025 Q3 - Quarterly Results