Financial Performance - Old National's net income applicable to common shareholders for 2025 was $653.1 million, or $1.79 per diluted common share, with adjusted net income of $808.6 million, or $2.21 per diluted common share [230][231]. - Net income available to common shareholders was $653,122, a 24.8% increase from $523,053 in 2024 [239]. - The diluted net income per common share increased to $1.79 in 2025 from $1.68 in 2024, a rise of 6.5% [251]. - The company reported a return on average assets of 1.21% and a return on average common equity of 10.44% for the fourth quarter of 2025 [237]. - The return on average tangible common equity was 15.27%, slightly down from 15.37% in 2024 [239]. Growth and Acquisitions - Total deposits grew by 35% in 2025, with a loan-to-deposit ratio of 89% [230]. - Old National completed its acquisition of Bremer on May 1, 2025, enhancing its operating platform [233]. - Total loans reached $48.76 billion by December 31, 2025, up from $36.29 billion a year earlier [237]. - Total assets increased to $72,151,967, up 34.7% from $53,552,272 in the previous year [239]. - The company expanded its workforce to 4,971 full-time equivalent employees, an increase from 4,066 in the previous year [239]. Income and Revenue - Net interest income increased by 34% to $2.1 billion, driven by strong loan growth and the Bremer acquisition [232]. - Noninterest income rose from $354.7 million in 2024 to $466.5 million in 2025, primarily due to the Bremer acquisition and higher mortgage banking revenue [232]. - Noninterest income grew to $466,531 in 2025, compared to $354,697 in 2024, marking a 31.5% increase [251]. - The company reported a total interest income increase of $672,099 thousand from 2024 to 2025, attributed to strong loan growth and higher average balances [260]. Efficiency and Management - The efficiency ratio improved to 55.10%, reflecting disciplined expense management [230]. - The efficiency ratio improved to 55.10%, down from 55.85% in 2024, indicating better cost management [239]. - Total noninterest expense increased to $1.5 billion in 2025, a 35.7% rise from 2024, including $140.9 million of merger-related expenses [272]. Credit and Loan Quality - Provision for credit losses increased to $197,721, compared to $110,619 in 2024, reflecting a rise of 78.5% [239]. - The allowance for credit losses on loans increased to $569.5 million at December 31, 2025, up from $392.5 million at December 31, 2024, reflecting adjustments related to the Bremer acquisition [297]. - Total charge-offs for 2025 amounted to $125.0 million, significantly higher than $71.3 million in 2024 [332]. - The net charge-off ratio for commercial loans was 0.46% in 2025, up from 0.35% in 2024, indicating a rise in credit losses [333]. Asset Management - The tangible common equity to tangible assets ratio improved to 7.72% in 2025 from 7.41% in 2024, indicating stronger capital efficiency [249]. - The investment securities portfolio increased to $14.9 billion at December 31, 2025, compared to $10.9 billion at December 31, 2024, primarily due to the Bremer acquisition [279]. - Total funding increased by $16.3 billion to $62.5 billion at December 31, 2025, reflecting both deposit growth and wholesale borrowings [302]. Regulatory and Compliance - The effective tax rate was 20.5% in 2025, slightly down from 20.8% in 2024, influenced by tax benefits from tax credit investments [275]. - Old National's credit ratings are Baa1 for long-term and A1 for short-term from Moody's Investors Service as of December 31, 2025 [354]. - Compliance and regulatory risk management is embedded in the company's culture, with oversight from multiple lines of defense [359]. Future Outlook - Looking ahead, Old National aims for continued organic growth and investment in technology and talent [235]. - Projected net interest income for December 31, 2025, is estimated at $9,050,648 thousand, reflecting a year-over-year increase driven by loan growth and asset repricing [344].
OLD NATIONAL BAN(ONBPO) - 2025 Q4 - Annual Report