Summary of Old National Bancorp (ONBPP) Q3 2025 Earnings Call

1Key Financial Results and Metrics

Earnings Per Share: GAAP EPS of $0.46; adjusted EPS of $0.59 (up 11% quarter-over-quarter and 28% year-over-year).

Return on Average Tangible Common Equity: 20%.

Return on Assets: 1.3%.

Efficiency Ratio: Sub 50%, specifically at 48%.

Credit Quality: Criticized and classified loans decreased by 6%; total net charge-offs at 25 basis points.

Capital Position: Common Equity Tier 1 (CET1) ratio over 11%, tangible book value per share increased by 4% quarter-over-quarter and 10% year-over-year.

Deposit Growth: Total deposits increased by 4.8% annualized, with core deposits growing by 5.8%.

2Strategic Updates and Business Highlights

Successful systems conversion and branding of Bremer Bank partnership completed.

Focus on organic growth rather than pursuing new partnerships; emphasis on internal talent acquisition.

Continued investment in enhancing operational efficiency and effectiveness.

Strong performance in fee income, particularly in capital markets, although some normalization is expected in the fourth quarter.

Ongoing commitment to capital management, including a share repurchase of 1,100,000 shares.

3Forward Guidance and Outlook

Loan Growth: Anticipated full-year loan growth of 4% to 5%, with expectations for continued success in deposit strategy.

Net Interest Income (NII): Expected to remain stable to improving, with guidance reflecting two additional rate cuts in 2025.

Fee Income: Increased guidance based on strong Q3 performance, but normalization expected in Q4.

Efficiency Improvements: Full run-rate cost savings from Bremer expected to materialize in Q1 2026.

4Bad News, Challenges, or Points of Concern

Potential credit cracks in the industry were acknowledged, although management believes these are manageable and not indicative of broader systemic issues.

Some concerns about the impact of Bremer-related loan runoff, with $200 million noted in Q3, although this is considered normal post-acquisition attrition.

The company is navigating a competitive environment for deposits and loans, with a focus on maintaining above-peer growth rates.

5Notable Q&A Insights

Management clarified that the slight reduction in NII expectations for Q4 is minor relative to the overall size of their earning assets.

There is a commitment to organic growth, with plans for continued hiring to capitalize on market opportunities.

The company remains cautious about credit quality, emphasizing a stable outlook despite industry concerns.

Share repurchases were timed later in the quarter due to increased confidence in capital and operational stability post-Bremer integration. Overall, Old National Bancorp reported strong financial results for Q3 2025, with a focus on organic growth and operational efficiency, while navigating industry challenges and maintaining a positive outlook for the future.