First Internet Bancorp(US:INBK)2026-03-11 20:54Financial Performance - For the twelve months ended December 31, 2025, the company reported a net loss of $35.2 million, or $4.03 diluted loss per share, compared to a net income of $25.3 million, or $2.88 per diluted share for the same period in 2024[159]. - The decrease in net income of $60.4 million for 2025 was primarily due to a $55.2 million increase in provision for credit losses, a $44.6 million decrease in noninterest income, and a $4.9 million increase in noninterest expense[160]. - Adjusted net loss for 2025, excluding the after-tax net loss on the loan sale, was $5.7 million, with an adjusted diluted loss per share of $0.66[162]. - For the twelve months ended December 31, 2024, net income increased by $16.9 million compared to 2023, driven by an 81.2% increase in noninterest income and a 16.7% increase in net interest income[163]. - The company reported adjusted net income of $22.0 million for 2024, with adjusted diluted earnings per share of $2.51[164]. - Total revenue for 2025 was $116,472,000, a decrease of 13.5% from $134,722,000 in 2024[233]. - Net loss for 2025 was $35,168,000 compared to a net income of $25,276,000 in 2024, reflecting a significant decline[233]. - Adjusted total revenue increased to $154,706,000 in 2025 from $129,989,000 in 2024, marking a growth of 19.0%[233]. Interest Income and Expenses - Total interest-earning assets for 2025 were $5.66 billion, generating net interest income of $113.76 million, with a net interest margin of 2.01%[167]. - Net interest income for the twelve months ended December 31, 2025 was $113.8 million, an increase of $26.4 million, or 30.2%, compared to $87.4 million for the same period in 2024[169]. - Total interest income increased by $28.3 million, or 9.7%, to $320.2 million for the twelve months ended December 31, 2025, compared to $291.9 million for the same period in 2024[169]. - Total interest expense rose by $1.9 million, or 0.9%, to $206.4 million for the twelve months ended December 31, 2025, compared to $204.5 million for the same period in 2024[169]. - Net interest margin (NIM) increased to 2.01% for the twelve months ended December 31, 2025, up from 1.65% for the same period in 2024, reflecting a 36 basis points increase[173]. - Net interest income for 2025 rose to $113,760,000, up 30.3% from $87,377,000 in 2024[232]. - Net interest margin improved to 2.01% in 2025 from 1.65% in 2024[232]. Noninterest Income and Expenses - Noninterest income for the twelve months ended December 31, 2025 was $2.7 million, a decrease of $44.6 million, or 94.3%, compared to $47.3 million for the same period in 2024[175]. - Adjusted noninterest income decreased by $1.7 million, or 3.9%, primarily due to a decrease in gain on sale of loans, which was $29.4 million in 2025 compared to $33.2 million in 2024[176]. - Total noninterest expense for the twelve months ended December 31, 2025 was $95.0 million, an increase of $4.9 million, or 5.5%, compared to $90.1 million for the same period in 2024[178]. - The increase in total noninterest expense was driven by higher costs in premises and equipment, which rose by $2.2 million, or 19.4%[179]. Asset Quality and Credit Losses - The company recognized a pre-tax loss of $38.2 million from the sale of $851.2 million in single tenant lease financing loans, aimed at strengthening regulatory capital ratios and improving interest rate risk position[161]. - The allowance for credit losses (ACL) was $55.7 million as of December 31, 2025, up from $44.8 million as of December 31, 2024, reflecting updated assumptions in the CECL model[204]. - The provision for credit losses on loans was $71.9 million for the twelve months ended December 31, 2025, compared to $18.8 million for the same period in 2024[205]. - Total nonperforming loans increased to $58.5 million, or 1.56% of total loans, compared to $28.4 million, or 0.68%, in the previous year[195]. - The allowance for credit losses on loans to total loans ratio increased to 1.49% as of December 31, 2025, from 1.07% in the previous year[195]. - The company actively monitors asset quality and may adjust the ACL based on future economic conditions[203]. Balance Sheet and Equity - Total assets decreased by $166.2 million, or 2.9%, to $5.6 billion as of December 31, 2025, compared to $5.7 billion as of December 31, 2024[185]. - Total shareholders' equity was $359.8 million, a decrease of $24.3 million, or 6.3%, compared to December 31, 2024[186]. - Tangible common equity totaled $355.1 million, representing a decrease of $24.3 million, or 6.4%, compared to December 31, 2024[186]. - Book value per common share decreased by 6.5% to $41.41 as of December 31, 2025, from $44.31 as of December 31, 2024[187]. - The ratio of total shareholders' equity to total assets decreased to 6.46% as of December 31, 2025, from 6.69% as of December 31, 2024[186]. Deposits and Liquidity - Total deposits decreased by $93.4 million, or 1.9%, to $4.8 billion as of December 31, 2025, primarily due to a $287.7 million decrease in brokered deposits[215]. - Interest-bearing demand deposits increased by $224.2 million, or 25.0%, and noninterest-bearing deposits increased by $10.4 million, or 7.6%[215]. - Uninsured deposit balances represented 33% of total deposits at December 31, 2025, up from 25% in 2024[216]. - The Company had $1.2 billion in cash and cash equivalents and investment securities available-for-sale as of December 31, 2025[224]. - The Company had access to an additional $1.1 billion in off-balance sheet deposits sold into the IntraFi deposit network[224]. Capital and Regulatory Compliance - Capital ratios for the Company and the Bank were above regulatory requirements for well-capitalized institutions as of December 31, 2025[227]. - The company repurchased 27,998 shares of common stock at an average price of $18.64 for a total investment of $0.5 million as of December 31, 2025[230]. Risk Management - Market risk primarily arises from interest rate fluctuations, impacting earnings and equity value, with a focus on managing net interest income and volatility[252]. - The estimated impact on net interest income (NII) and economic value of equity (EVE) is presented under various interest rate scenarios, showing changes of up to 6.20% for NII in Year 1 under a -200 basis points scenario[253][254]. - The NII and EVE figures are based on a static balance sheet, not accounting for potential growth or strategies to increase net interest income[255].