stal Financial (US:CCB)2025-11-07 14:27Financial Performance - Net income for the three months ended September 30, 2025, was $13.6 million, or $0.88 per diluted share, compared to $13.5 million, or $0.97 per diluted share, for the same period in 2024[155]. - Net interest income for the three months ended September 30, 2025, was $77.9 million, an increase of $5.6 million, or 7.8%, compared to $72.3 million for the same period in 2024[160]. - Net interest income for the nine months ended September 30, 2025, was $230.7 million, an increase of $30.0 million, or 15.0%, compared to $200.7 million for the same period in 2024[175]. - Noninterest income for the three months ended September 30, 2025, was $66.8 million, a decrease of $12.0 million, or 15.2%, from $78.8 million in the same quarter of 2024[202]. - For the nine months ended September 30, 2025, noninterest income was $172.9 million, down $61.2 million or 26.1% from $234.1 million in the prior year, primarily due to lower BaaS indemnification income[204]. Loan and Deposit Growth - Total loans increased by $163.5 million, or 4.6%, during the three months ended September 30, 2025, with community bank loans up by $39.6 million, or 2.1%, and CCBX loans up by $123.9 million, or 7.4%[151]. - Loans receivable totaled $3.70 billion as of September 30, 2025, an increase of $217.3 million, or 6.2%, compared to December 31, 2024[251]. - Total deposits as of September 30, 2025, were $3.97 billion, an increase of $387.2 million, or 10.8%, compared to $3.59 billion as of December 31, 2024[302]. - CCBX total deposits increased by $310.9 million, or 15.1%, to $2.37 billion as of September 30, 2025, compared to $2.06 billion as of December 31, 2024[303]. Interest Income and Expense - Interest income from interest-earning deposits with other banks increased by $3.2 million, or 67.5%, to $8.0 million for the quarter ended September 30, 2025[162]. - Interest expense decreased by $1.8 million to $31.1 million for the quarter ended September 30, 2025, with interest on deposits at $30.5 million, down from $32.1 million in the prior year[163]. - The average rate paid on total deposits decreased to 3.04% for the three months ended September 30, 2025, down from 3.59% for the same period in 2024[309]. Credit Quality and Losses - The provision for credit losses for the nine months ended September 30, 2025, was $143.6 million, a decrease of $69.4 million compared to $213.0 million for the same period in 2024[198]. - Net charge-offs for the nine months ended September 30, 2025, totaled $146.8 million, compared to $158.7 million for the same period in 2024[290]. - The allowance for credit losses as a percentage of loans was 4.69% at September 30, 2025, compared to 5.03% at September 30, 2024[192]. Asset Management - As of September 30, 2025, total assets were $4.55 billion, total loans receivable were $3.70 billion, total deposits were $3.97 billion, and total shareholders' equity was $475.3 million[149]. - Total interest earning assets for Q3 2025 were $4.41 billion, generating interest income of $109.03 million, compared to $3.88 billion and $105.17 million in Q3 2024[170]. - The company sold $3.66 billion in CCBX loans during the nine months ended September 30, 2025, as part of its strategy to optimize the CCBX portfolio[246]. Operational Efficiency - The efficiency ratio improved to 48.50% for the three months ended September 30, 2025, down from 60.98% in the previous quarter[346]. - Return on average assets improved to 1.19% for the three months ended September 30, 2025, up from 0.99% in the previous quarter[346]. - Return on average equity increased to 11.52% for the three months ended September 30, 2025, compared to 9.72% in the previous quarter[346]. Noninterest Expenses - Total noninterest expense for the nine months ended September 30, 2025, was $215.0 million, an increase of $36.0 million or 20.2% from $178.9 million in the prior year[212]. - Salaries and employee benefits for the three months ended September 30, 2025, increased by $3.1 million or 18.1% to $20.1 million compared to $17.1 million in 2024[211]. - Noninterest expenses for CCBX increased by $25.4 million, or 20.0%, to $152.2 million as of September 30, 2025, compared to $126.9 million as of September 30, 2024[246]. Strategic Initiatives - Six existing partner programs are being expanded to include new products such as lines of credit and credit cards, with Robinhood's deposit program expected to ramp up in Q4 2025[154]. - The company expects to continue selling CCBX loans as part of its ongoing strategy to manage the loan portfolio and credit quality[267]. - The company has portfolio limits with partners to manage loan concentration risk, with capital call lines outstanding balance totaling $177.5 million as of September 30, 2025[338].