Lakeland Financial (US:LKFN)2025-10-29 11:02Financial Performance - Net income for the first nine months of 2025 was $73.5 million, a 6.0% increase from $69.3 million in the same period of 2024[117] - Diluted earnings per share for the first nine months of 2025 rose to $2.85, up 5.9% from $2.69 in the comparable period of 2024[117] - Pretax pre-provision earnings for the first nine months of 2025 were $101.0 million, a 5.8% increase from $95.5 million in the same period of 2024[117] - For the third quarter of 2025, net income was $26.4 million, an improvement of 13.1% from $23.3 million in the same quarter of 2024[136] - The diluted earnings per common share for the third quarter of 2025 was $1.03, an increase of 13.2% from $0.91 in the comparable period of 2024[136] Income and Expenses - Net interest income increased by $18.8 million, or 13.0%, while noninterest income decreased by $9.6 million, or 21.3% in the first nine months of 2025[117] - Noninterest expense increased by $3.7 million, or 3.9%, in the first nine months of 2025[117] - Noninterest expense increased by $4.6 million, or 15.0%, during the third quarter of 2025[137] - Total noninterest income decreased by $9.6 million, or 21.3%, to $35.4 million for the nine months ended September 30, 2025, compared to $45.0 million for the same period in 2024[155] - Total noninterest expense increased by $3.7 million, or 3.9%, to $98.2 million for the nine months ended September 30, 2025, compared to $94.4 million for the same period in 2024[157] Assets and Equity - Total assets as of September 30, 2025, were $6.895 billion, reflecting a 3.2% increase from $6.678 billion at December 31, 2024[122] - Total equity increased by $63.6 million, or 9.3%, from $683.9 million at December 31, 2024, to $747.5 million at September 30, 2025[122] - Total average earning assets rose to $6.498 billion for the nine months ended September 30, 2025, an increase of $217.6 million, or 3.5%, from $6.281 billion in the prior year[144] - Total cash and cash equivalents increased by $24.6 million, or 14.6%, to $192.8 million at September 30, 2025, from $168.2 million at December 31, 2024[163] - Total deposits increased by $123.4 million, or 2.1%, from December 31, 2024, to $6.024 billion as of September 30, 2025[181] Loan and Credit Quality - Average loans outstanding increased by $183.6 million, or 3.7%, to $5.207 billion for the nine months ended September 30, 2025[144] - The loan portfolio increased by $148.5 million, or 3.0%, to $5.180 billion at September 30, 2025, driven primarily by growth in commercial and industrial loans, commercial real estate loans, and consumer mortgage loans[169] - Net charge-offs increased significantly to $29.6 million during the nine months ended September 30, 2025, compared to $1.4 million in the same period of 2024[151] - The allowance for credit losses was 1.30% of total loans as of September 30, 2025, down from 1.68% at December 31, 2024, reflecting a decrease attributed to a previously disclosed charge-off[174] - Total nonperforming assets decreased by $37.8 million, or 66.5%, to $19.1 million during the nine-month period ended September 30, 2025, with the nonperforming assets to total assets ratio dropping to 0.28%[171] Capital and Liquidity - The Tier I Capital ratio was 15.06% for the consolidated entity as of September 30, 2025, exceeding the minimum required of 6.00%[187] - The Company had access to $3.585 billion in unused liquidity as of September 30, 2025, compared to $3.681 billion at December 31, 2024[179] - Brokered deposits increased by $134.1 million, or 322.6%, to $175.6 million at September 30, 2025, compared to $41.6 million at December 31, 2024[181] - The effective tax rate increased to 17.7% for the nine months ended September 30, 2025, compared to 16.0% for the same period in 2024[160] - The allowance for credit losses decreased by $17.8 million, or 20.7%, from $86.0 million at December 31, 2024, to $68.2 million at September 30, 2025[178] Interest Rate and Market Risks - The Company’s interest rate risk is primarily managed through a policy reviewed annually by the Corporate Risk Committee, with the last review conducted in July 2025[192] - The Company anticipates that actual results may differ materially from forward-looking statements due to various economic and market conditions, including interest rates and inflation[190] - The Company faces risks related to changes in borrowers' credit risks and payment behaviors, which could impact loan demand and collateral values[190] - The Company’s performance in the commercial real estate loan portfolio is influenced by the elevated interest rate environment and changing retail and office usage patterns[190] - The Company’s interest rate scenarios include a range of changes from falling 300 basis points to rising 300 basis points, affecting cumulative net interest income over a twelve-month horizon[193]