Financial 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 of 2024, a decrease of 25.6%[220] - The company reported a net interest income of $102.017 million for Q3 2025, compared to $60.887 million for Q3 2024[227] - Net interest income for the three months ended September 30, 2025, was $246.7 million, an increase from $182.6 million for the same period in 2024[234] - For the nine months ended September 30, 2025, noninterest income totaled $29.0 million, a 123.1% increase from $13.0 million for the same period in 2024[235] 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 widening of the 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 of 2024[223] - The net interest margin for the three months ended September 30, 2025, was 3.04%, compared to 2.67% for the same period in 2024[234] Expenses and Provisions - Noninterest expenses for the nine months ended September 30, 2025, increased by $58.3 million compared to the same period in 2024[220] - Noninterest expenses for the nine months ended September 30, 2025, totaled $171.6 million, up $58.3 million or 51.5% from $113.3 million for the same period in 2024[237] - The provision for credit losses increased by $34.4 million for the nine months ended September 30, 2025, compared to the same period in 2024[220] - 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] - 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 merger-related costs[236] Loans and Assets - Gross loans reached $11.3 billion as of September 30, 2025, reflecting a $3.0 billion or 36.6% increase compared to December 31, 2024[241] - The commercial real estate loan segment increased by $1.84 billion or 31.2% from December 31, 2024, totaling $7.72 billion as of September 30, 2025[241] - Total multifamily loans as of September 30, 2025, were $3.46 billion, up from $2.50 billion as of December 31, 2024[244] - The total nonowner-occupied loans reached $2.66 billion as of September 30, 2025, compared to $1.97 billion as of December 31, 2024[246] - Owner-occupied loans totaled $1.41 billion as of September 30, 2025, an increase from $1.10 billion as of December 31, 2024[246] - The average loans receivable for the three months ended September 30, 2025, was $11.16 billion, compared to $8.12 billion for the same period in 2024[254] Deposits and Equity - Total average deposits increased by $3.8 billion, or 49.3%, during the three months ended September 30, 2025, compared to the same period in 2024, primarily due to the merger with FLIC[286] - Average total deposits for the nine months ended September 30, 2025, increased by $1.7 billion, or 22.9%, compared to the same period in 2024, attributed to the merger with FLIC[290] - Total deposits increased by $3.5 billion, or 45.4%, compared to December 31, 2024, driven by a $1.6 billion increase in interest-bearing demand deposits[297] - The Company's stockholders' equity increased by $296.6 million compared to December 31, 2024, mainly due to an increase in common stock from the FLIC merger[304] - As of September 30, 2025, the tangible common equity ratio was 8.36%, down from 9.49% as of December 31, 2024[306] Credit Quality - As of September 30, 2025, the Company's Allowance for Credit Losses (ACL) was $156.5 million, an increase of $73.8 million from $82.7 million as of December 31, 2024[248] - Total nonperforming assets as of September 30, 2025, were $39.7 million, down from $57.3 million as of December 31, 2024[258] - Nonaccrual loans represented 0.35% of total loans receivable as of September 30, 2025, compared to 0.69% as of December 31, 2024[259] - The ratio of annualized net charge-offs during the three months ended September 30, 2025, was 0.18%, slightly up from 0.17% in the same period of 2024[254] Capital Ratios - As of September 30, 2025, the Company's Tier 1 leverage capital is $1,293,585 with a ratio of 9.35%, exceeding the minimum requirement of 4.00% by 5.35%[311] - The Company's CET I risk-based ratio stands at 10.17%, which is 5.67% above the minimum requirement of 4.50%[311] - The Company's total risk-based capital is $1,606,662, representing a ratio of 13.88%, exceeding the minimum requirement of 8.00% by 5.88%[311] - The Bank's Tier 1 leverage capital is $1,430,511 with a ratio of 10.35%, surpassing the minimum requirement of 4.00% by 6.35%[312] - The Bank's CET I risk-based ratio is 12.37%, which is 7.87% above the minimum requirement of 4.50%[312] - The Bank's total risk-based capital is $1,547,066, with a ratio of 13.38%, exceeding the minimum requirement of 8.00% by 5.38%[312] Market Risk - Interest rate risk management is identified as the primary market risk for the Company[313] - A 200 basis-point increase in interest rates is estimated to 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]
CONNECTONE BN(CNOBP) - 2025 Q3 - Quarterly Report