OLD NATIONAL BAN(US:ONBPP)2026-02-19 16:52Financial 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 in 2025, a 24.8% increase from $523,053 in 2024 [239]. - The diluted net income per common share increased to $1.79 in 2025, compared to $1.68 in 2024, a rise of 6.5% [251]. - The return on average common equity for Q4 2025 was 10.44%, up from 9.83% in Q4 2024 [237]. - The return on average tangible common equity was 15.27% in 2025, 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]. - The total loans increased to $48.76 billion by December 31, 2025, up from $36.29 billion a year earlier [237]. - Total assets grew to $72,151,967 in 2025, compared to $53,552,272 in 2024, an increase of 34.7% [239]. - The company's assets grew to $72.2 billion at December 31, 2025, an increase of $18.6 billion from $53.6 billion at December 31, 2024, mainly due to the acquisition of Bremer [276]. Income and Expenses - 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]. - 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]. - The efficiency ratio improved to 55.10%, reflecting disciplined expense management [230]. Credit Quality and Losses - Provision for credit losses increased to $197,721 in 2025, up from $110,619 in 2024, reflecting a significant rise in credit risk [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 provision for credit losses increased by $87.1 million in 2025 compared to 2024, reaching $197.7 million, primarily due to credit migration and macroeconomic factors [267]. - The net charge-off ratio for commercial loans was 0.46% in 2025, compared to 0.35% in 2024, indicating a rise in credit losses [333]. Deposits and Funding - Total deposits grew by $14.3 billion to $55.1 billion at December 31, 2025, attributed to Bremer deposits and organic growth [302]. - Total funding increased by $16.3 billion to $62.5 billion at December 31, 2025, reflecting both deposit growth and wholesale borrowings [302]. - The estimated amount of FDIC uninsured deposits for regulatory purposes was $23.7 billion at December 31, 2025 [303]. Operational Metrics - Full-time equivalent employees increased to 4,971 in 2025, up from 4,066 in 2024, reflecting expansion in operations [239]. - The average loans for the year increased to $44.22 billion in 2025 from $35.51 billion in 2024, reflecting growth in the loan portfolio [333]. - The average commercial loan size was approximately $771,000, while the average commercial real estate loan size was approximately $1.5 million as of December 31, 2025 [322]. Risk Management - The company is focused on managing interest rate risk to maximize net interest income while maintaining adequate funding and liquidity [340]. - Compliance and regulatory risk management is embedded in the company culture, ensuring adherence to applicable laws and regulations [359]. - The company maintains frameworks to manage operational risks, including cybersecurity threats and internal control weaknesses [358]. Tax and Legal Considerations - 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]. - The company reviews income tax expense and deferred tax assets quarterly, with potential material impacts from tax law interpretations and disputes [378].