Old National Bancorp Q4 Earnings Call Highlights

Core Insights - The company successfully completed the systems conversion and integration related to its Bremer Bank partnership, marking it as one of its smoothest integrations ever [1] - Fourth-quarter GAAP earnings per share (EPS) were reported at $0.55, with adjusted EPS at $0.62, reflecting a 5% increase from the prior quarter and a 27% increase year over year [2] - The company achieved record profitability metrics in 2025, including adjusted EPS, net income, and efficiency ratio, driven by core deposit growth and disciplined credit management [3][4] Financial Performance - Adjusted EPS for Q4 was $0.62, up 27% year over year, with an adjusted return on average tangible common equity (ROTCE) of nearly 20% and an adjusted return on assets (ROA) of 1.37% [3][7] - The company reported total loan growth of 6.4% annualized from the prior quarter, with loan production up 25% [8] - Deposits increased by 0.6% annualized in the quarter, with non-interest-bearing deposits growing to 26% of core deposits [9] Outlook for 2026 - The company anticipates full-year loan growth of 4%–6% and a stable-to-improving net interest margin supported by repricing and securities cash flows [5][17] - Management plans to be more active in share buybacks while maintaining strong capital levels, with a CET1 ratio above 11% [6][16] - The company expects net interest income to increase, supported by fixed-asset repricing and continued growth [17] Cost Management and Efficiency - Adjusted non-interest expenses were reported at $365 million in Q4, with a record-low adjusted efficiency ratio of 46% [13] - The company realized about 28% of anticipated cost savings from the Bremer integration in Q4, with full realization expected in Q1 2026 [13] Credit Quality - Credit metrics improved, with net charge-offs at 27 basis points and criticized and classified loans declining by $278 million [15] - The allowance for credit losses was reported at 124 basis points of total loans, down two basis points from the prior quarter [15]