Landmark Bancorp(US:LARK)2025-11-13 20:37Financial Performance - Net earnings for Q3 2025 were $4.9 million, a 25.4% increase from $3.9 million in Q3 2024[99] - Net earnings for the first nine months of 2025 reached $14.0 million, up 44.4% from $9.7 million in the same period of 2024[99] - Non-interest income decreased by $185,000, or 4.3%, to $4.1 million in the third quarter of 2025 compared to the same period in 2024, mainly due to lower fees and service charges[118] - Total non-interest income for the first nine months of 2025 was $11.1 million, a decrease of $321,000 or 2.8% from the same period in 2024, primarily due to lower fees related to deposit accounts[119] - Non-interest expense for the third quarter of 2025 totaled $11.3 million, an increase of $692,000 or 6.6% over the same quarter of 2024, driven by higher compensation and benefits[120] Interest Income and Expenses - Interest income for Q3 2025 was $20.7 million, a 9.0% increase from $19.0 million in Q3 2024[102] - Net interest income for Q3 2025 increased by $2.5 million, or 21.5%, to $14.1 million compared to Q3 2024[106] - The net interest margin for Q3 2025 was 3.83%, up from 3.30% in Q3 2024[106] - Interest expense for Q3 2025 decreased to $6.6 million, down from $7.4 million in Q3 2024[104] - The total cost of interest-bearing deposits decreased from 2.48% in Q3 2024 to 2.18% in Q3 2025[104] Asset and Liability Management - Average loan balances increased from $985.7 million in Q3 2024 to $1.1 billion in Q3 2025[102] - Total interest-earning assets increased to $1,478,010 thousand for the three months ended September 30, 2025, compared to $1,419,665 thousand for the same period in 2024, reflecting a growth of 4.1%[109] - Total interest-bearing liabilities rose to $1,080,690 thousand for the three months ended September 30, 2025, compared to $1,046,601 thousand for the same period in 2024, marking an increase of 3.2%[109] - The ratio of average interest-earning assets to average interest-bearing liabilities was 136.8% for the three months ended September 30, 2025, slightly up from 135.6% in the same period of 2024[109] Credit Quality - Provision for credit losses on loans was $850,000 in the third quarter of 2025, an increase from $500,000 in the same period of 2024, primarily due to loan growth[115] - Net loan charge-offs increased to $2.3 million during the third quarter of 2025, compared to $9,000 in the same period of 2024, primarily due to a single commercial credit charge-off[115] - The allowance for credit losses on loans was $12.3 million, or 1.10% of gross loans outstanding, as of September 30, 2025, down from $12.8 million or 1.22% at December 31, 2024[126] - Loans past due 30-89 days totaled $4.9 million, or 0.43% of gross loans, as of September 30, 2025, down from $6.2 million or 0.59% at December 31, 2024[128] Dividends and Shareholder Returns - The company declared a 5% stock dividend in October 2025, marking the 25th consecutive year of such dividends[97] - The company paid a quarterly cash dividend of $0.21 per share to stockholders during the quarter ended September 30, 2025[142] - As of September 30, 2025, approximately $18.8 million was available to be paid as dividends to the Company by the Bank without prior regulatory approval[143] Market Risk and Management - The primary component of market risk for the Company is interest rate volatility, which significantly impacts net interest income and the fair value of financial instruments[145] - The Asset/Liability Management Committee (ALCO) monitors interest rate sensitivity and has set policy limits for interest rate risk, assessing the position quarterly[146] - The ALCO formulates strategies based on the current outlook for interest rates and other economic factors, impacting earnings and capital[146] - The Company employs methodologies to manage interest rate risk, including analysis of interest-earning assets and interest-bearing liabilities[146] Forward-Looking Statements - Forward-looking statements in the document are based on management's beliefs and expectations, and are subject to uncertainties[148] - Factors affecting future performance include the strength of local, state, national, and international economies, as well as inflationary pressures and monetary policies[149] - Risks and uncertainties should be considered when evaluating forward-looking statements, and undue reliance should not be placed on them[150]