Q - BANNER
For the period ended Jun 30, 2025. Filed Aug 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 5, 2025
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Asset Quality
Maintaining a moderate risk profile by employing appropriate underwriting standards, avoiding excessive asset concentrations and aggressively managing troubled assets has been and will continue to be a primary focus for us. We actively engage with our borrowers to resolve adversely classified loans and other problem assets.
Non-Performing Assets: Non-performing assets totaled $49.8 million, or 0.30% of total assets, at June 30, 2025, compared to $39.6 million, or 0.24% of total assets, at December 31, 2024. Our allowance for credit losses - loans was $160.5 million, or 373% of non-performing loans, at June 30, 2025, compared to $155.5 million, or 421% of non-performing loans, at December 31, 2024.
The increase in non-performing assets was primarily due to a $5.5 million increase in nonaccrual one- to four-family residential loans. In addition, loans more than 90 days past due and still on accrual increased to $2.5 million at June 30, 2025, primarily due to an increase in one- to four-family residential loans in this category.
The following table sets forth information with respect to our non-performing assets at the dates indicated (dollars in thousands):
| June 30, 2025 | December 31, 2024 | June 30, 2024 | |
|---|---|---|---|
| Nonaccrual Loans: | |||
| Secured by real estate: | |||
| Commercial | $10 | $2,186 | $2,326 |
| Construction and land | 4,369 | 3,963 | 3,999 |
| One- to four-family | 15,480 | 10,016 | 8,184 |
| Commercial business | 6,647 | 7,067 | 8,694 |
| Agricultural business, including secured by farmland | 8,690 | 8,485 | 1,586 |
| Consumer | 4,802 | 4,835 | 3,380 |
| 39,998 | 36,552 | 28,169 | |
| Loans more than 90 days delinquent, still on accrual: | |||
| Secured by real estate: | |||
| One- to four-family | 2,896 | 369 | 1,861 |
| Consumer | 80 | 35 | 692 |
| 2,976 | 404 | 2,553 | |
| Total non-performing loans | 42,974 | 36,956 | 30,722 |
| REO, net | 6,801 | 2,367 | 2,564 |
| Other repossessed assets held for sale | — | 300 | — |
| Total non-performing assets | $49,775 | $39,623 | $33,286 |
| Total non-performing assets to total assets | 0.30% | 0.24% | 0.21% |
| Total nonaccrual loans to total loans receivable | 0.34% | 0.32% | 0.25% |
| Loans 30-89 days past due and on accrual | $10,786 | $26,824 | $11,850 |
For the six months ended June 30, 2025, interest income was reduced by $870,000 as a result of nonaccrual loan activity, which included the reversal of $263,000 of accrued interest as of the date the loan was placed on nonaccrual. There was no interest income recognized on nonaccrual loans for the six months ended June 30, 2025.
The following table presents the Company’s portfolio of loans by risk grade at the dates indicated (in thousands):
| June 30, 2025 | December 31, 2024 | June 30, 2024 | |
|---|---|---|---|
| Pass | $11,432,456 | $11,118,744 | $10,971,850 |
| Special Mention | 68,372 | 43,451 | 50,027 |
| Substandard | 189,545 | 192,461 | 121,971 |
| Total | $11,690,373 | $11,354,656 | $11,143,848 |
As of June 30, 2025, total substandard loans primarily consisted of loans within the commercial business, commercial real estate and agricultural loan segments.
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