LINKBANCORP(LNKB) - 2025 Q4 - Annual Results

Financial Performance - Net income for Q4 2025 was $2.9 million, or $0.08 per diluted share, down from $7.8 million, or $0.21 per diluted share in Q3 2025[1]. - Full year 2025 net income increased by 26.8% to $33.5 million, or $0.90 per diluted share, compared to $26.2 million, or $0.71 per diluted share in 2024[5]. - Adjusted pre-tax, pre-provision net income for Q4 2025 was $11.7 million, up from $11.0 million in Q3 2025[1]. - Net income for the three months ended December 31, 2025, was $2,942,000, a decrease from $7,584,000 for the same period in 2024[36]. - Adjusted net income for the three months ended December 31, 2025, was $3,839,000, with an adjusted return on average assets of 0.50%[62]. - Net Income (GAAP) for the twelve months ended December 31, 2025, was $33,511,000, compared to $26,209,000 for the previous year, representing a year-over-year increase of 27.7%[65]. - Adjusted Net Income (Non-GAAP) for the three months ended December 31, 2025, was $7,628,000, a slight decrease from $7,839,000 in the previous quarter[65]. Assets and Liabilities - Total assets as of December 31, 2025, amounted to $3,069.99 million, an increase from $2,878.78 million on December 31, 2024, representing a growth of approximately 6.63% year-over-year[34]. - Total liabilities increased to $2,762,817,000 from $2,563,566,000 year-over-year[46]. - Total assets as of December 31, 2025, were $3,071,482,000, an increase from $2,842,450,000 at the end of 2024[46]. Deposits and Loans - Total deposits as of December 31, 2025 were $2.55 billion, reflecting a 10.9% annual increase from $2.45 billion at the end of 2024[5]. - Total loans increased to $2.56 billion as of December 31, 2025, representing a 13.1% annualized growth from $2.35 billion at the end of 2024[5]. - Total deposits reached $2,554.75 million as of December 31, 2025, up from $2,360.58 million on December 31, 2024, indicating an increase of approximately 8.23%[34]. - Total loans receivable increased to $2,556,729, up from $2,347,556, representing a year-to-date change of $209,173 and an annualized growth rate of 13.08%[52]. Credit Losses and Allowances - The provision for credit losses in Q4 2025 was $6.6 million, with $5.0 million related to a specific reserve for a single commercial credit[17]. - The allowance for credit losses for loans was $31.7 million, or 1.24% of total loans held for investment, up from 1.03% at the end of Q3 2025[20]. - The allowance for credit losses on loans was $31.67 million as of December 31, 2025, compared to $26.44 million a year prior, showing a rise of about 19.8%[34]. Shareholders' Equity - Shareholders' equity totaled $306.43 million as of December 31, 2025, an increase from $280.22 million on December 31, 2024, representing a growth of approximately 9.34%[34]. - Total shareholders' equity as of December 31, 2025, was $306,432,000, up from $305,457,000 in the previous quarter[66]. Strategic Initiatives - The Company announced a strategic merger with Burke & Herbert valued at approximately $354.2 million, expected to create a combined organization with $11.0 billion in assets[6]. - The proposed merger with Burke & Herbert is subject to various risks, including regulatory approvals and potential impacts on market prices, which could affect the anticipated benefits of the transaction[26]. - The company anticipates that revenues following the proposed transaction may be lower than expected due to integration challenges and economic conditions[26]. Cost Management - Management emphasizes the importance of controlling costs and expenses amid increased competition and changing consumer demand for financial services[26]. - Total non-interest expense was $19,539,000 for the three months ended December 31, 2025, compared to $18,302,000 for the same period in 2024, indicating a rise of 6.8%[38]. - Adjusted non-interest expense (Non-GAAP) for the three months ended December 31, 2025, was $18,389,000, compared to $18,171,000 in the previous quarter[69]. Earnings Per Share - Basic earnings per share for the three months ended December 31, 2025, was $0.08, down from $0.20 for the same period in 2024[38]. - GAAP-based earnings per share (EPS) for the three months ended December 31, 2025, was $0.08, while adjusted EPS (non-GAAP) was $0.10[64]. Efficiency and Margins - The efficiency ratio for the three months ended December 31, 2025, was 65.03%, compared to 65.04% for the same period in 2024[38]. - The net interest margin for the quarter was 3.74%, slightly down from 3.85% in the previous year[46]. - The GAAP-based efficiency ratio for the three months ended December 31, 2025, was 65.03%, an increase from 62.25% in the previous quarter[68].