ConnectOne Bancorp(US:CNOB)2025-11-03 21:56Financial Performance - Net income available to common stockholders for Q3 2025 was $39.5 million, up from $15.7 million in Q3 2024, representing a 151.6% increase[219]. - Diluted earnings per share for Q3 2025 were $0.78, compared to $0.41 for Q3 2024, reflecting a 90.2% increase[219]. - For the nine months ended September 30, 2025, net income available to common stockholders was $36.4 million, down from $48.9 million in the same period in 2024, a decrease of 25.6%[220]. - Noninterest income for the third quarter of 2025 was $19.4 million, significantly higher than $4.7 million in the third quarter of 2024, boosted by a one-time benefit of $6.6 million from the employee retention tax credit[234]. Interest Income and Margin - Fully taxable equivalent net interest income for Q3 2025 increased by $41.4 million, or 67.2%, compared to Q3 2024, driven by a 44 basis-point increase in net interest margin to 3.11%[222]. - The net interest margin for the nine months ended September 30, 2025, was 3.04%, an increase of 37 basis points from 2.67% in the same period in 2024[223]. - Net interest income for the nine months ended September 30, 2025, was $246.7 million, compared to $182.6 million for the same period in 2024, reflecting a net interest margin of 3.04%[234]. Expenses - Noninterest expenses increased by $58.3 million for the nine months ended September 30, 2025, compared to the same period in 2024[220]. - The company reported a $20.0 million increase in noninterest expenses for the third quarter of 2025 compared to the same quarter in 2024, primarily due to increased salaries and employee benefits[236]. - Noninterest expenses for the nine months ended September 30, 2025, totaled $171.6 million, up from $113.3 million in the same period of 2024, with a $33.2 million increase attributed to merger expenses[237]. Loans and Credit Quality - Gross loans reached $11.3 billion as of September 30, 2025, reflecting a $3.0 billion increase or 36.6% compared to December 31, 2024, largely due to the merger with FLIC[241]. - The provision for credit losses on loans increased by $1.7 million in Q3 2025 compared to the same period in 2024[219]. - The provision for credit losses for the three months ended September 30, 2025, was $5.5 million, compared to $3.8 million for the same period in 2024[249]. - Net charge-offs for the three months ended September 30, 2025, were $5.1 million, compared to $3.5 million for the same period in 2024[250]. - Nonaccrual loans decreased to $39.7 million as of September 30, 2025, from $57.3 million as of December 31, 2024[258]. - The ratio of nonaccrual loans to total loans receivable was 0.35% as of September 30, 2025, down from 0.69% as of December 31, 2024[259]. Assets and Deposits - The total assets of the company as of September 30, 2025, were $11.65 billion, up from $9.78 billion at the end of 2024[240]. - Total average deposits increased by $3.8 billion, or 49.3%, to $11.4 billion for the three months ended September 30, 2025, compared to the same period in 2024, primarily due to the merger with FLIC[286]. - Total deposits increased by $3.5 billion, or 45.4%, to $11.4 billion as of September 30, 2025, compared to December 31, 2024, mainly due to a $1.6 billion increase in interest-bearing demand deposits[297]. Capital and Ratios - The Company's stockholders' equity increased by $296.6 million compared to December 31, 2024, primarily due to an increase in common stock of $270.8 million from the FLIC merger[304]. - As of September 30, 2025, the Company reported Tier 1 leverage capital of $1,293,585 with a ratio of 9.35%, exceeding the minimum requirement of 4.00% by 5.35%[311]. - The CET I risk-based ratio for the Company was 10.17%, which is 5.67% above the minimum requirement of 4.50%[311]. - The total risk-based capital for the Company was $1,606,662, representing a ratio of 13.88%, which is 5.88% above the minimum requirement of 8.00%[311]. Market and Economic Conditions - The Company estimated that a 200 basis-point increase in interest rates would decrease net interest income by 4.05% over the next one-year period as of September 30, 2025[270]. - The estimated change in economic value of equity (EVE) would decrease by 4.99% with a 200 basis-point increase in interest rates as of September 30, 2025[272]. - Interest rate risk management is identified as the primary market risk for the Company[313].