Alerus(US:ALRS)2025-10-30 20:10Financial Performance - Alerus Financial Corporation reported net income of $16.9 million for Q3 2025, down from $20.3 million in Q2 2025 and up from $5.2 million in Q3 2024[2]. - Noninterest income was $29.4 million in Q3 2025, a 7.3% decrease from Q2 2025 but a 3.8% increase from Q3 2024[12][13]. - The return on average total assets was 1.27% in Q3 2025, down from 1.53% in Q2 2025[7]. - Net income for the three months ended September 30, 2025, was $16,924,000, down from $20,253,000 in the same quarter of 2024, a decrease of 16.3%[38]. - Adjusted net income for Q3 2025 was $17,000, down from $18,640 in Q2 2025, representing a decline of 8.8%[41]. - Earnings per common share for the nine months ended September 30, 2025, was $1.97, compared to $0.90 for the same period in 2024, representing a 118.9% increase[38]. Income and Expenses - Net interest income reached a record $43.1 million in Q3 2025, a 0.2% increase from Q2 2025 and a 91.4% increase from Q3 2024[4][10]. - Noninterest expense for Q3 2025 was $50.5 million, a 4.3% increase from Q2 2025[15]. - Noninterest expense for Q3 2025 increased by $8.1 million, or 19.1%, to $50.5 million, primarily due to higher compensation and technology expenses related to the HMNF acquisition[16]. - Total noninterest expense for the nine months ended September 30, 2025, was $149,344,000, up from $120,218,000 in 2024, marking a 24.2% increase[38]. Assets and Loans - Total loans increased by $109.5 million, or 2.7%, to $4.1 billion since December 31, 2024[7]. - Total assets as of September 30, 2025, were $5.3 billion, an increase of $68.9 million, or 1.3%, from December 31, 2024, driven by a $109.5 million increase in loans held for investment[17]. - Total loans held for investment reached $4.1 billion as of September 30, 2025, up $109.5 million, or 2.7%, from December 31, 2024, with commercial loans increasing by $69.4 million[18]. - Net loans amounted to $4.04 billion as of September 30, 2025, an increase from $3.93 billion as of December 31, 2024[37]. Deposits - Total deposits rose by $34.2 million, or 0.8%, to $4.4 billion since December 31, 2024[7]. - Total deposits were $4.4 billion as of September 30, 2025, an increase of $34.2 million, or 0.8%, from December 31, 2024, driven by growth in commercial deposits[21]. - Interest-bearing deposits increased by $160.9 million, while noninterest-bearing deposits decreased by $126.7 million from December 31, 2024[21]. Equity and Capital Ratios - Total stockholders' equity increased to $550.7 million as of September 30, 2025, up by $55.3 million from December 31, 2024[26]. - Tangible common equity to tangible assets (non-GAAP) improved to 8.24% as of September 30, 2025, compared to 7.13% as of December 31, 2024[27]. - Common equity tier 1 capital to risk-weighted assets increased to 10.84% as of September 30, 2025, from 9.91% as of December 31, 2024[27]. Asset Quality - Total nonperforming assets decreased by $2.8 million, or 4.4%, to $60.1 million as of September 30, 2025, with the allowance for credit losses on loans at $62.1 million, or 1.51% of total loans[23]. - The company recorded net recoveries of $1.7 million in Q3 2025, compared to net charge-offs of $3.8 million in Q2 2025, indicating improved asset quality[24]. - The provision for credit losses for the three months ended September 30, 2025, was $0, compared to $1,661,000 in the same period of 2024, indicating a significant reduction[38]. Operational Efficiency - Efficiency ratio increased to 65.34% in September 2025, compared to 60.66% in June 2025, indicating a decline in operational efficiency[39]. - Adjusted efficiency ratio for Q3 2025 was 65.22%, compared to 62.35% in Q2 2025, indicating a decline in operational efficiency[41]. Conference and Market Presence - The company will host a conference call on October 31, 2025, to discuss its financial results[28]. - Alerus operates 28 banking and commercial wealth offices across multiple states, enhancing its market presence[30].