GAAP earnings per share (EPS): $0.44 per common share.
Adjusted EPS: $0.46.
Adjusted return on average tangible common stock (ROATC): 16.8%.
Adjusted return on assets (ROA): 1.13%.
Adjusted efficiency ratio: 51.2%.
Core deposit growth: 10.1% annually.
Growth in non-interest-bearing deposits: nearly $100 million during the quarter.
Total deposit cost: 225 basis points.
Commercial loan growth rate: 4.1% annually.
Specific common book value per share growth rate: 8% since Q2 2024, 21% year over year.
Common Equity Tier 1 (CET1) ratio: 11%.
Total loan growth rate: 2.7% QoQ.
Investment portfolio growth: 3% in the quarter.
Total deposit growth rate: 8.5% annually starting in the second quarter.
Adjusted non-interest income: $94 million for the quarter.
Adjusted noninterest expense: $263 million in the quarter.
Total net charge-off: 19 basis points.
Allowance for credit losses as a percentage of total loans: 112 basis points.
Release date: October 22, 2024
For a complete record of financial statements, see Complete Record of Financial Statements.
Old National Bancorp (NASDAQ:ONB) reported strong organic deposit growth of 10.1% annually, with nearly $100 million in non-interest deposits added during the quarter.
The company achieved a low adjusted efficiency ratio of 51.2%, demonstrating effective cost management.
Tangible common book value per share increased 8% sequentially and 21% year over year, highlighting strong capital growth.
The company’s CET1 ratio is a healthy 11%, providing it with a strong capital base.
Old National Bancorp (NASDAQ:ONB) showed strong performance in its fee-based business, with adjusted non-interest income of $94 million for the quarter, which was better than expected.
Net interest income growth is expected to be slower in the fourth quarter, in part because of lower five-year berry yields.
The non-performing loan ratio increased by 8 basis points, mainly due to four unrelated sector borrowers.
Provision expense was slightly higher than originally expected due to the transition to a more conservative risk rating framework.
The company increased deposit rates by 9 basis points compared to the previous quarter, reflecting competitive pressures.
Old National Bancorp (NASDAQ:ONB) expects fee income to be lower in the fourth quarter due to seasonality and non-recurring items from the third quarter.
Q: Can you elaborate on NII’s expectations for the fourth quarter and the impact of cash flow on NII’s growth? A: CFO John Moran said NII’s outlook is based on the impact of the lower end of the five-year curve. I explained that I would take it. Over the next 12 months, cash flow from securities will be approximately $2 billion, an increase of 110 basis points to the backbook, most of which will be reinvested in the securities book.
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Q: Why did credit costs increase this quarter? Will this trend continue? A: CFO John Moran said the increase in credit costs is part of credit normalization. Ta. Reserves in the quarter covered charge-offs, with a small reserve and in line with annual guidance of 17 to 20 basis points for charge-offs.
Q: If there is a significant rate cut, how do you expect net interest margin (NIM) to behave in 2025? A: CFO John Moran expects NIM to increase slightly in the fourth quarter and has a positive outlook for 2025 due to an inverted yield curve and continued franchise growth. It should benefit the entire industry.
Q: What is your approach to recruiting and talent acquisition, especially in a fee-based business? A: Mark Sander, President and COO He said he is open to opportunistic hiring in fee-based businesses such as treasury and wealth management.
Q: Can you talk about the increase in delinquent and classified loans? A: Mark Sander, president and chief operating officer (COO), said the increase in delinquent loans is both manageable and previously noted.4 He pointed out that this was due to two larger loans. The increase in confidential loans can be attributed to a more conservative risk framework that focuses on primary sources of repayment.
For a complete record of financial statements, see Complete Record of Financial Statements.
This article first appeared on GuruFocus.
