M
ME NEWS
15 Apr 2025, 07:52
FB Financial Reports Q1 Earnings: Loan Growth and Margin Expansion Boost Profitability
FB Financial Corporation (NYSE: FBK), the parent company of FirstBank, reported net income of $39.4 million, or $0.84 per diluted share, for the first quarter of 2025. Adjusted net income was $40.1 million, or $0.85 per diluted share, matching the prior quarter and year-ago period.
The company achieved a net interest margin of 3.55%, up from 3.50% in the prior quarter, driven by disciplined deposit pricing and balance sheet optimization. Loans held for investment grew 7.14% on an annualized basis to $9.77 billion, supported by commercial and consumer lending activity. Total deposits remained stable at $11.20 billion, with noninterest-bearing deposits increasing to $2.16 billion.
“The Company had good results to start the year, with measured growth in loans and customer deposits during a quarter that was slower economically than we expected,” said President and CEO Christopher T. Holmes. “Our strong capital and liquidity positions provide flexibility for continued momentum.”
Highlights
Net income: $39.4 million
Diluted EPS: $0.84
Adjusted diluted EPS: $0.85
Return on Average Assets: 1.21%
Return on Tangible Common Equity: 11.9%
Net Interest Margin: 3.55%
Book Value Per Share: $34.44
Tangible Book Value Per Share: $29.12
Balance Sheet and Margin Insights
Net interest income on a tax-equivalent basis was $108.4 million, reflecting a slight decline in interest income but offset by a reduction in funding costs. The cost of total deposits fell to 2.54%, driven by lower brokered deposit balances and a shift toward lower-cost funding. The cost of interest-bearing deposits decreased by 24 basis points to 3.13%.
Loan growth was led by increases in commercial and industrial loans, consumer loans, and commercial real estate. Residential real estate also expanded, while construction loan balances declined.
“We managed margin and liquidity effectively by reducing higher-cost deposits while continuing loan growth,” added Holmes.
Credit Quality and Capital
Credit quality remained sound with net charge-offs at 0.14% of average loans, down from 0.47% in the prior quarter. The allowance for credit losses stood at $150.5 million, or 1.54% of loans held for investment.
Capital levels remained robust:
Common Equity Tier 1 Ratio: 12.8%
Total Risk-Based Capital Ratio: 15.2%
Tangible Common Equity to Tangible Assets: 10.5%
The company also repurchased 208,680 shares during the quarter as part of its capital deployment strategy.
Noninterest Income and Expenses
Noninterest income was $23.0 million, with mortgage banking contributing $12.4 million, up from $10.6 million in the prior quarter. Noninterest expenses rose to $79.5 million, mainly due to seasonal compensation adjustments and performance-based incentives.
“The increase in expenses reflects higher compensation-related costs tied to performance and annual adjustments,” said CFO Michael Mettee.
Strategic Progress and Outlook
FB Financial continued to expand its market presence, adding new operations in Asheville, North Carolina and Tuscaloosa, Alabama. The company also highlighted the pending merger with Southern States Bancshares, Inc., reinforcing its strategic growth trajectory.
“Our team is energized and ready to capitalize on the opportunities ahead, supported by strong liquidity, solid credit, and scalable operations,” concluded Holmes.
FB Financial Corporation (NYSE: FBK), the parent company of FirstBank, reported net income of $39.4 million, or $0.84 per diluted share, for the first quarter of 2025. Adjusted net income was $40.1 million, or $0.85 per diluted share, matching the prior quarter and year-ago period.
The company achieved a net interest margin of 3.55%, up from 3.50% in the prior quarter, driven by disciplined deposit pricing and balance sheet optimization. Loans held for investment grew 7.14% on an annualized basis to $9.77 billion, supported by commercial and consumer lending activity. Total deposits remained stable at $11.20 billion, with noninterest-bearing deposits increasing to $2.16 billion.
“The Company had good results to start the year, with measured growth in loans and customer deposits during a quarter that was slower economically than we expected,” said President and CEO Christopher T. Holmes. “Our strong capital and liquidity positions provide flexibility for continued momentum.”
Highlights
Net income: $39.4 million
Diluted EPS: $0.84
Adjusted diluted EPS: $0.85
Return on Average Assets: 1.21%
Return on Tangible Common Equity: 11.9%
Net Interest Margin: 3.55%
Book Value Per Share: $34.44
Tangible Book Value Per Share: $29.12
Balance Sheet and Margin Insights
Net interest income on a tax-equivalent basis was $108.4 million, reflecting a slight decline in interest income but offset by a reduction in funding costs. The cost of total deposits fell to 2.54%, driven by lower brokered deposit balances and a shift toward lower-cost funding. The cost of interest-bearing deposits decreased by 24 basis points to 3.13%.
Loan growth was led by increases in commercial and industrial loans, consumer loans, and commercial real estate. Residential real estate also expanded, while construction loan balances declined.
“We managed margin and liquidity effectively by reducing higher-cost deposits while continuing loan growth,” added Holmes.
Credit Quality and Capital
Credit quality remained sound with net charge-offs at 0.14% of average loans, down from 0.47% in the prior quarter. The allowance for credit losses stood at $150.5 million, or 1.54% of loans held for investment.
Capital levels remained robust:
Common Equity Tier 1 Ratio: 12.8%
Total Risk-Based Capital Ratio: 15.2%
Tangible Common Equity to Tangible Assets: 10.5%
The company also repurchased 208,680 shares during the quarter as part of its capital deployment strategy.
Noninterest Income and Expenses
Noninterest income was $23.0 million, with mortgage banking contributing $12.4 million, up from $10.6 million in the prior quarter. Noninterest expenses rose to $79.5 million, mainly due to seasonal compensation adjustments and performance-based incentives.
“The increase in expenses reflects higher compensation-related costs tied to performance and annual adjustments,” said CFO Michael Mettee.
Strategic Progress and Outlook
FB Financial continued to expand its market presence, adding new operations in Asheville, North Carolina and Tuscaloosa, Alabama. The company also highlighted the pending merger with Southern States Bancshares, Inc., reinforcing its strategic growth trajectory.
“Our team is energized and ready to capitalize on the opportunities ahead, supported by strong liquidity, solid credit, and scalable operations,” concluded Holmes.
