FSUN — FirstSun Capital Bancorp

Summary of FirstSun Capital Bancorp Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Adjusted Net Income: $26.9 million, with adjusted diluted EPS of $0.95.
• Adjusted ROAA: 1.27%.
• Revenue Growth: 10.8% annualized increase over the previous quarter.
• Net Interest Margin (NIM): Strong at 4.18%, up 11 basis points from Q3, maintaining above 4% for 13 consecutive quarters.
• Loan Growth: Average loan growth of 8.5% annualized; new loan fundings were approximately $350 million, up 30% year-over-year.
• Deposits: Flat on both average balance and period-end basis, with total deposits increasing over $400 million or approximately 6.5% for the year.
• Charge-Offs: Total charge-offs primarily driven by a telecom loan, with a charge-off ratio of 43 basis points for the year.

2. Strategic Updates and Business Highlights

• Continued focus on relationship-based banking and reinvestment in franchise growth, resulting in $11.5 million of positive adjusted operating leverage for the full year.
• Plans to invest in growth markets and expand product offerings, particularly in Texas and Southern California.
• Progress on the pending merger with First Foundation, with integration planning and balance sheet optimization underway.

3. Forward Guidance and Outlook

• Loan and Deposit Growth: Expected to grow at a mid-single-digit rate throughout 2026.
• Net Interest Income: Anticipated mid-single-digit growth in 2026, with stable NIM relative to 2025.
• Noninterest Revenue: Expected growth in the low double-digit to low teens range for 2026.
• Expense Management: Anticipated adjusted noninterest expense growth in the mid- to high single-digit range.

4. Bad News, Challenges, or Points of Concern

• Asset Quality: Charge-offs related to two loans in the C&I portfolio, with ongoing monitoring of credit conditions due to potential lumpiness in credit quality.
• Deposit Costs: Competitive pressures on deposit pricing, with expectations for lower betas compared to historical levels.
• Special Mention Loans: Increase attributed to macroeconomic pressures and specific names, with no pervasive issues but a need for careful monitoring.

5. Notable Q&A Insights

• Deposit Strategy: Management acknowledged competitive pressures on deposit pricing and indicated a focus on operating account growth rather than CDs.
• Loan Pricing: Credit spreads have remained stable, but competition is increasing, which may affect future loan betas.
• Merger Impact: Management remains optimistic about the merger with First Foundation, with no significant changes expected in financial metrics due to recent interest rate cuts.
• Market Opportunities: Increased opportunity in Texas due to M&A activity, with plans to build out C&I teams in both Texas and Southern California.

Overall, FirstSun Capital Bancorp reported strong financial results for Q4 2025, with positive growth metrics and strategic initiatives in place, though challenges related to asset quality and competitive pressures on deposits were acknowledged.