Cadence Bank Announces First Quarter 2025 Financial Results

Core Viewpoint - Cadence Bank reported strong financial results for Q1 2025, highlighting improved operating leverage, expanded net interest margin, and organic loan growth despite economic volatility. The bank also received regulatory approvals for its merger with First Chatham Bank, expected to close on May 1, 2025 [3][14]. Financial Performance - Net income available to common shareholders for Q1 2025 was $130.9 million, or $0.70 per diluted share, compared to $114.6 million, or $0.62 per diluted share in Q1 2024 [4][14]. - Adjusted net income for Q1 2025 was $131.4 million, or $0.71 per diluted share, up from $114.4 million, or $0.62 per diluted share in Q1 2024 [4][14]. - Return on average assets improved to 1.15% in Q1 2025, up from 0.97% in Q1 2024 [5][14]. - Adjusted pre-tax pre-provision net revenue (PPNR) was $189.9 million, an increase of 3.2% from Q4 2024 and 9.0% from Q1 2024 [5][14]. Net Interest Revenue - Net interest revenue for Q1 2025 was $363.2 million, compared to $353.9 million in Q1 2024 [6][14]. - The net interest margin improved to 3.46% in Q1 2025, up from 3.22% in Q1 2024 [6][14]. - Average earning assets slightly declined to $42.6 billion, with a net loan growth of $309.9 million, or 3.7% annualized [7][10]. Balance Sheet Activity - Total loans and leases increased to $34.1 billion as of March 31, 2025, compared to $33.7 billion at the end of Q4 2024 [10][14]. - Total deposits were $40.3 billion, a slight decline from $40.5 billion at the end of Q4 2024, primarily due to a decrease in brokered deposits [11][14]. - The loan to deposit ratio was 84.4% as of March 31, 2025 [11][14]. Credit Quality - Net charge-offs for Q1 2025 were $23.0 million, or 0.27% of average net loans, compared to $19.5 million, or 0.24% in Q1 2024 [13][14]. - The allowance for credit losses was $457.8 million, representing 1.34% of total loans and leases [15][14]. - Total nonperforming assets as a percentage of total assets were stable at 0.51% as of March 31, 2025 [16][14]. Noninterest Revenue and Expense - Noninterest revenue for Q1 2025 was $85.4 million, compared to $83.8 million in Q1 2024 [17][14]. - Noninterest expense decreased to $259.3 million in Q1 2025 from $263.2 million in Q1 2024, leading to an improved adjusted efficiency ratio of 57.6% [21][14]. Capital Management - Total shareholders' equity increased to $5.7 billion as of March 31, 2025, up from $5.2 billion a year earlier [23][14]. - Common Equity Tier 1 capital ratio was 12.4% as of March 31, 2025, indicating strong capital management [23][14]. Merger Activity - The merger with FCB Financial Corp. is expected to close on May 1, 2025, with all necessary regulatory approvals obtained [14][24]. - The transaction involves the issuance of approximately 2.3 million shares of common stock and $23.1 million in cash for all outstanding shares of First Chatham [24].