Financial Data and Key Metrics Changes - The company reported net income of $61.1 million and core net income of $63.3 million for Q3 2025, with core earnings per share at $1.51 and a core return on average tangible common equity of 25.5% [5][18] - Net interest margin increased by 9 basis points to 2.73% from the prior quarter, while the cost of deposits fell by 9 basis points to 1.47% [5][6] - Net interest income before provision for credit losses was $92.7 million, an increase of $3.3 million or 3.7% from the previous quarter [12] Business Line Data and Key Metrics Changes - Non-interest income totaled $61.2 million, an increase of $4.2 million over the last quarter, driven by higher banking fees and increased foreign exchange revenues [13] - Core non-interest expenses decreased due to lower performance-based incentive accruals and reduced property expenses [14] Market Data and Key Metrics Changes - Bermuda's business environment remains stable with signs of growth in the local economy, including a forecasted budget surplus and increased corporate income tax revenue [8][9] - The Cayman Islands is expected to see a 2.5% GDP increase in 2025, with financial services and tourism being key economic pillars [11] Company Strategy and Development Direction - The company aims to enhance operational efficiency and maintain prudent expense discipline while focusing on capital management [19][20] - The strategy includes pursuing disciplined M&A and organic business development, with a focus on capital-efficient fee-based businesses [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term value creation and highlighted the positive outlook for Bermuda's fiscal position and the growth in the international business sector [4][9] - The company remains conservative in its underwriting approach, focusing on high-quality residential lending across its markets [16] Other Important Information - The company announced a quarterly cash dividend of $0.50 per share and continued its share repurchase program, buying back 700,000 shares at a cost of $30.3 million [6][7] - The tangible book value per share improved by 5.4% to $25.06 as unrealized losses on investments improved [18] Q&A Session Summary Question: Margin trajectory outlook - Management indicated that deposit costs have decreased and there is potential for margin stability or slight expansion due to asset repricing [25][27] Question: Interest in crypto or stablecoin initiatives - Management described a cautious approach, monitoring developments in digital assets but not feeling pressure from clients to lead in this area [29][30] Question: Future expense management initiatives - Management discussed ongoing efforts to manage expenses, including moving back-office functions to Halifax and cloud migration of core banking systems [31][33] Question: Drivers of fee income growth - Management noted strong performance in banking driven by increased transaction volumes and tourism-related card services fees [41][42] Question: Growth expectations in loans and deposits - Management highlighted Bermuda as a key area for deposit growth and noted a conservative approach to loan growth, with encouraging signs in the loan pipeline particularly in Cayman [43][45]

Financial Data and Key Metrics Changes - The company reported net income of $61.1 million and core net income of $63.3 million for Q3 2025, with core earnings per share at $1.51 and a core return on average tangible common equity of 25.5% [6][19] - Net interest income before provision for credit losses was $92.7 million, an increase of $3.3 million or 3.7% from the prior quarter, with a net interest margin of 2.73%, up 9 basis points from the previous quarter [13][19] - The company announced a quarterly cash dividend of $0.50 per share and repurchased 700,000 shares at a cost of $30.3 million during the quarter [7][19] Business Line Data and Key Metrics Changes - Non-interest income totaled $61.2 million, an increase of $4.2 million over the last quarter, driven by higher banking fees and increased foreign exchange revenues [15] - Core non-interest expenses decreased due to lower performance-based incentive accruals and reduced property expenses [16] Market Data and Key Metrics Changes - Bermuda's business environment remains stable with signs of growth in the local economy, including a forecasted budget surplus and growth in the international business sector, particularly in reinsurance [9][10] - The Cayman Islands is expected to see a 2.5% GDP increase in 2025, with financial services and tourism being key economic pillars [11] Company Strategy and Development Direction - The company aims to enhance operational efficiency and maintain prudent expense discipline while focusing on capital management and organic growth [20] - The company is exploring strategic and accretive acquisition opportunities while continuing to diversify its fee income lines [34] Management's Comments on Operating Environment and Future Outlook - Management expressed a positive outlook for the fiscal position of Bermuda and continued growth in the international business sector [9][10] - The company anticipates stable net interest margins with potential for slight expansion due to asset repricing [29] Other Important Information - The company maintains a conservative balance sheet with low risk density and strong asset quality, with negligible net charge-offs and a non-accrual loan rate of 2% [17][19] - The tangible book value per share improved by 5.4% to $25.06 as unrealized losses on investments improved [19] Q&A Session Summary Question: Margin trajectory outlook - Management indicated that deposit costs have decreased and there is potential for margin stability or slight expansion due to asset repricing [25][29] Question: Interest in crypto or stablecoin initiatives - Management described themselves as a "slow follower" in the digital asset space, monitoring developments but not taking a lead role [32][34] Question: Future expense management initiatives - Management discussed ongoing efforts to manage expenses, including moving back-office functions to Halifax and maintaining a stable expense run rate [36][37] Question: Fee income business momentum - Management noted strong performance in banking driven by increased card services fees and transaction-related fees, with a positive outlook for the upcoming tourism season [42][45] Question: Growth expectations in loans and deposits - Management highlighted Bermuda as a key area for deposit growth and noted a conservative approach to loan growth, with encouraging signs in the loan pipeline, particularly in Cayman [46][50]

Q1 2025 Financial Performance - The company reported a net loss of $217.7 million, or $1.08 per diluted share, primarily due to the sale of $1.3 billion of low-yielding available-for-sale (AFS) securities[5,7] - Operating net income reached $67.5 million, or $0.34 per diluted share[5,7] - Net interest margin (NIM) expanded by 33 basis points to 3.38%[5,7] Asset Quality and Capital - Non-performing loans (NPLs) decreased to $91.6 million, representing 0.51% of total loans, an improvement from $135.8 million, or 0.76% at year-end 2024[5,7] - The company's CET1 ratio stood at 14.2% and allowance coverage to total loans was 1.25%[5,7,67] - The company repurchased 2.9 million shares for $48.7 million at a weighted average price of $16.62 per share[7] Deposits and Loans - Total deposits decreased by $636 million linked-quarter to $20.828 billion, with 50% in checking accounts[25,46,53] - Total loans increased by $125 million linked quarter, or 3% annualized[57] - The CRE portfolio totaled $7.2 billion, representing 39% of total loans[87] Merger with HarborOne - The company announced a merger with HarborOne, a transaction valued at $490 million[137,154] - The merger is expected to result in approximately 16% EPS accretion in 2026[137,156] - The company anticipates cost savings of approximately $55 million, representing about 40% of HarborOne's operating non-interest expenses[154,166]