The Company reported net income of $113.9 million for the year ended December 31, 2024, and diluted EPS of $6.71. For the same period in 2023 the Company reported net income of $113.6 million and diluted EPS of $6.73.
The year ended December 31, 2024 was highlighted by several significant items:
| ● | Record annual net income of $113.9 million, or $6.71 per diluted share; |
| ● | Record adjusted net income (non-GAAP) of $119.3 million, or $7.03 per diluted share (non-GAAP); |
| ● | Significant capital markets revenue of $71.1 million; |
| ● | Robust loan growth of 10% prior to loan securitizations and strong deposit growth of 8%; |
| ● | Tangible book value (non-GAAP) per share increased $6.40, or 15%; and |
| ● | Increased TCE/TA ratio (non-GAAP) by 80 basis points to 9.55%. |
Following is a table that represents the various net income measurements for the years ended December 31, 2024 and 2023.
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| · · · Year Ended December 31, |
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| · · · 2024 · · 2023 |
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| · · · (dollars in thousands, except per share data) |
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| | | | | | | | |
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| Net income | | | | $113,850 | | | $113,558 |
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| | | | | | | | |
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| Diluted earnings per common share | | | | $6.71 | | | $6.73 |
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| | | | | | | | |
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| Weighted average common and common equivalent shares outstanding | | | | 16,959,853 | | | 16,866,391 |
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The Company reported adjusted net income (non-GAAP) of $119.3 million, with adjusted diluted EPS of $7.03. See section titled “GAAP to Non-GAAP Reconciliations” for additional information. Adjusted net income for the year excludes a number of non-core or non-recurring items, after-tax, as set forth in the “GAAP to Non-GAAP Reconciliation” section.
Following is a table that represents the major income and expense categories for the years ended December 31, 2024 and 2023.
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| · · · Year Ended December 31, |
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| · 2024 · 2023 |
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| · · · (dollars are in thousands) |
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| | | | | | | | |
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| Net interest income | | | | $231,788 | | | $221,006 |
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| Provision for credit losses | | | | 17,098 | | | 16,539 |
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| Noninterest income | | | | 115,529 | | | 132,684 |
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| Noninterest expense | | | | 207,642 | | | 210,531 |
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| Federal and state income tax expense | | | | 8,727 | | | 13,062 |
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| Net income | | | | $113,850 | | | $113,558 |
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The following are some noteworthy developments in the Company’s financial results:
| ● | Net interest income increased $10.8 million, or 4.9%, in 2024 compared to the prior year. The increase in 2024 was primarily due to higher loan and investment average balances, margin expansion from higher loan yields partially offset by an increase in the cost of interest-bearing deposits. |
| ● | Provision expense increased $559 thousand when comparing 2024 to 2023. The increase in 2024 was due to overall loan growth and increased net charge offs. See the “Provision for Credit Losses” section of this Annual Report on Form 10-K for additional details. |
| ● | Noninterest income decreased $17.2 million, or 12.9%, when compared to the prior year. The decrease in 2024 was primarily attributable to lower capital markets revenue from swap fees. The demand for low-income housing remains healthy and the economics associated with these tax credit projects continue to be favorable. The Company has a strong pipeline for this business and expects it to continue to be a solid source of fee income in 2025. During the third quarter of 2024, the Company executed a derivative strategy with a notional value of approximately $409.0 million. These derivatives are designed to safeguard the Company’s regulatory capital against the adverse effects of a significant decline in long-term interest rates. These derivatives are unhedged and are marked to market, with gains or losses recorded in noninterest income and reflected as a non-core item. For the year ending December 31, 2024, the Company recorded a $3.5 million loss on these derivatives. |
| ● | Noninterest expense decreased $2.9 million, or 1.4%, in 2024 compared to the prior year, primarily due to lower variable incentive compensation associated with the lower capital markets revenue offset partially with restructuring expenses and goodwill impairment related to the decision to discontinue offering new loans and leases through m2 in September 2024. |
