Origin Bank(US:OBK)2026-01-29 15:02Financial Data and Key Metrics Changes - The company reported diluted earnings per share of $0.95 and net income of $29.5 million, achieving a run rate on average assets of 1.19%, exceeding the targeted 1%+ run rate [10] - Net interest income (NII) increased by 10.2%, while revenue, excluding notable items, rose by 8.8% [5] - Non-interest expense, excluding notable items, decreased by 0.7% [5] - The annualized pre-tax, pre-provision return on assets (ROA) increased to 1.7% from 1.63% [10] Business Line Data and Key Metrics Changes - Loan origination increased approximately $500 million, or 37% year-over-year, with loan and swap fees rising by 57% during the same period [6] - The company achieved 20% ownership of Argent Financial and consolidated banking centers [5] - Non-interest income reported was $16.7 million in Q4, with a decline to $16.3 million when excluding notable items [14] Market Data and Key Metrics Changes - Total past dues at year-end were 0.96% of total loans, reflecting no change from the prior quarter [8] - Non-performing assets declined from 1.18% to 1.07% at year-end, indicating a reduction of approximately $7 million [8] - The company experienced a slight increase in total classified loans, rising from 1.4% to 1.92% of total loans [8] Company Strategy and Development Direction - The company is focused on the "Optimize Origin" initiative, aiming for a 1% ROA by Q4 2025 and ultimately targeting a top quartile ROA [3] - The strategy includes investing approximately $10 million in new bankers and banking teams to capitalize on market disruptions [7] - The company plans to intensify focus on client delivery models for additional revenue growth in 2026 [6] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing strong momentum and readiness to leverage market opportunities [4] - The company anticipates loan growth to be more weighted towards the second half of the year, targeting mid to high single-digit growth for loans and deposits [12] - Management highlighted the importance of maintaining discipline in growth to ensure profitability [55] Other Important Information - The tangible book value grew sequentially to $35.04, marking the 13th consecutive quarter of growth [15] - The company redeemed approximately $145 million in subordinated debt and repurchased about $16 million worth of common stock while maintaining strong capital ratios [16] Q&A Session Summary Question: What is the target for new producer hires this year? - Management indicated that the $10 million budget allows for hiring additional bankers beyond the 10 already added, with ongoing strategic conversations in various markets [21][22] Question: How will new hires impact loan growth guidance? - Most new hires are expected to impact loan growth in the latter half of the year, with a focus on maintaining profitability [27][29] Question: What is the outlook for net interest margin? - Management anticipates slight margin compression in Q1 due to timing differences in loan versus deposit repricing, with expectations for margin expansion later in the year [31][33] Question: How does the company plan to compete for new hires? - The company focuses on its strong culture and geographic model to attract C&I-focused bankers, with an expected earnback period of 12-15 months for new hires [65][66] Question: What is the strategy regarding capital deployment? - Management plans to balance buybacks and dividends while focusing on organic growth opportunities, particularly in light of market disruptions [49][48]