First Financial Bancorp.(US:FFBC)2025-11-04 14:45Financial Performance - Net income for the three months ended September 30, 2025, was $71.92 million, representing a 37% increase compared to $52.45 million for the same period in 2024[10]. - The net earnings per common share for the three months ended September 30, 2025, were $0.76, up from $0.56 in the same period of 2024, a growth of 35.7%[10]. - Comprehensive income for the nine months ended September 30, 2025, totaled $260,011 thousand, up from $241,502 thousand in 2024, reflecting an increase of 7.66%[13]. - Noninterest income for the nine months ended September 30, 2025, increased to $192.67 million, up from $153.71 million in the same period of 2024, a growth of 25.4%[10]. - The company reported a total interest expense of $89.77 million for the three months ended September 30, 2025, down from $101.56 million in the same period of 2024, a decrease of 11.6%[10]. Asset and Liability Management - Total assets as of September 30, 2025, were $18.55 billion, a slight decrease from $18.57 billion on December 31, 2024[8]. - Total deposits rose to $14.43 billion as of September 30, 2025, compared to $14.33 billion at the end of 2024, an increase of 0.7%[8]. - The total fair value of held-to-maturity and available-for-sale investment securities as of September 30, 2025, was $3.488 billion, with total unrealized losses of $263.542 million[38]. - The total fair value of investment securities available-for-sale increased to $3,422.6 million as of September 30, 2025, up from $3,183.8 million as of December 31, 2024, reflecting a rise of about 7.5%[199]. - The total liabilities measured at fair value were $299.9 million as of September 30, 2025, down from $397.5 million as of December 31, 2024, representing a decrease of approximately 24.6%[199]. Loan Portfolio - Total loans and leases decreased to $11.71 billion as of September 30, 2025, from $11.76 billion at the end of 2024, a decline of 0.4%[8]. - The total loan portfolio as of September 30, 2025, includes $627,960,000 in construction real estate loans, with $115,620,000 classified as pass[56]. - The total amount of commercial real estate loans classified as pass for 2025 is $146,543,000, down from $189,777,000 in 2024, indicating a decrease of approximately 22.8%[57]. - The total amount of special mention loans for 2025 is $2,214,000, compared to $2,881,000 in 2024, showing a decrease of approximately 23.1%[57]. - The total amount of substandard loans for 2025 is $250,000, down from $2,618,000 in 2024, indicating a decline of about 90.4%[57]. Credit Quality and Losses - The provision for credit losses for loans and leases was $8.61 million for the three months ended September 30, 2025, compared to $9.93 million for the same period in 2024, indicating a reduction of 13.3%[10]. - The provision for credit losses on loans for the nine months ended September 30, 2025, was $27,567 thousand, down from $38,227 thousand in 2024, a reduction of 28%[21]. - Year-to-date gross charge-offs for commercial and industrial loans are $793,000, while lease financing has year-to-date gross charge-offs of $0[56]. - Total nonaccrual loans increased to $75.951 million as of September 30, 2025, compared to $65.973 million as of December 31, 2024, reflecting a growth of approximately 15.5%[68]. - The allowance for credit losses increased to $161.916 million as of September 30, 2025, up from $158.831 million at the end of September 2024, reflecting a growth of 1.4%[94]. Investment Securities - The total fair value of loans held for sale was $21.5 million as of September 30, 2025, with an unpaid principal balance of $19.8 million, indicating a fair value premium of $1.7 million[204]. - The fair value of mortgage-backed securities (residential) had a fair value of $1.292 billion as of September 30, 2025, with unrealized losses of $74.625 million[38]. - The total amount of cash and due from banks at the end of the period was $174,659 thousand as of September 30, 2025, down from $190,618 thousand at the same time in 2024[21]. - The company recorded impairment losses of $3.4 million and $9.7 million for the three and nine months ended September 30, 2025 and 2024, respectively[41]. - The company assessed that no reserves were needed for AFS securities in an unrealized loss position for the periods ended September 30, 2025, or December 31, 2024[42]. Derivative Instruments and Risk Management - The company monitors its derivative credit exposure through normal credit review processes and maintains collateral agreements with counterparties[130]. - The total notional amount of derivatives designated as qualifying hedging instruments was $1 billion, resulting in a gain of $1.0 million and a loss of $619,000[148]. - The total notional amount of derivatives not designated as qualifying hedging instruments was $19.5 billion, with a gain of $301.9 million and a loss of $300.9 million[150]. - First Financial's interest rate risk management strategy includes the use of derivative instruments such as interest rate caps, floors, and swaps[127]. - The company has the option to defer interest payments on acquired subordinated notes for up to 20 consecutive quarters[124]. Tax and Regulatory Matters - For the third quarter of 2025, income tax expense was $18.8 million, resulting in an effective tax rate of 20.7%, compared to $12.4 million and an effective tax rate of 19.2% for the same period in 2024[167]. - First Financial had no unrecognized tax benefits as of September 30, 2025, and December 31, 2024[168]. - Deferred tax assets increased significantly in the third quarter of 2025 due to the new legislation allowing 100% bonus depreciation for assets placed in service after January 19, 2025[169]. - The company recognized an amortization expense of $4.981 million for tax credit investments in the third quarter of 2025, compared to an expense of $4.622 million for the same period in 2024[166]. - First Financial's investments in affordable housing projects and other tax credit investments totaled $205.590 million as of September 30, 2025, with unfunded commitments of $97.049 million[164].