1st Source (SRCE) Q2 2025 earnings summary

Executive summary

• Total assets reached $9.1 billion as of June 30, 2025, up 1.74% from year-end, driven by loan and deposit growth and a diversified business mix.

• Net income for Q2 2025 was $37.32 million, up 1.43% year-over-year, with YTD net income at $74.84 million, a 12.97% increase over 2024.

• Diluted EPS was $1.51 for Q2 and $3.02 for the first half, both higher than the prior year.

• Recognized for leadership and performance, including Forbes' 2025 Best Banks, KBW Bank Honor Roll, and community awards.

• Shareholders' equity increased to $1.20 billion, with book value per share at $48.86.

Financial highlights

• Net interest income for Q2 2025 was $85.19 million, up 15.03% year-over-year; net interest margin improved to 4.01%.

• Noninterest income for Q2 was $23.06 million, with trust and wealth advisory services contributing 31%.

• Noninterest expense rose 5.15% year-over-year, mainly from higher salaries, benefits, and technology costs.

• Provision for credit losses was $7.69 million in Q2, up from Q1 and prior year, reflecting loan growth and higher special attention balances.

• Tangible book value per share increased to $45.44, with an 8.78% CAGR since 2018.

Outlook and guidance

• Management remains cautious due to economic uncertainty, inflation, and geopolitical risks, but highlights strong capital and liquidity.

• Focus on long-term EPS and tangible book value growth, with continued investment in digital banking and specialty finance.