Cadence Bank (CADE) Q1 2025 earnings summary

Executive summary

• Adjusted net income available to common shareholders was $131.4 million ($0.71 per share), up 14% year-over-year, with GAAP net income at $130.9 million ($0.70 per share).

• Return on average assets improved to 1.15%, up 18 basis points year-over-year.

• Adjusted pre-tax pre-provision net revenue rose to $190 million, up over 3% sequentially and 9% year-over-year.

• Net organic loan growth was $309.9 million (3.7% annualized), with stable core customer deposits.

• Regulatory and shareholder approvals received for the merger with FCB Financial Corp./First Chatham Bank, expected to close May 1, 2025, expanding presence in Georgia.

Financial highlights

• Net interest margin improved by 8 basis points to 3.46% sequentially and 24 basis points year-over-year.

• Adjusted noninterest expense declined by $8.1 million (3%) quarter-over-quarter, improving the adjusted efficiency ratio to 57.6%.

• Net charge-offs annualized at 0.27% of average loans, up from 0.17% sequentially, mainly due to a single C&I credit.

• Allowance for credit losses stood at 1.34% of net loans and leases.

• Tangible book value per share increased to $22.30, up 14.5% year-over-year.

Outlook and guidance

• 2025 guidance remains unchanged, with expectations for low to mid-single digit growth in loans and core customer deposits.

• Net interest margin anticipated to remain stable, with deposit repricing offsetting loan yield compression.

• Net charge-offs expected in the 20-30 basis point range, similar to 2024.

• Quarterly expenses expected to increase but remain within 4%-6% annual guidance.

• Guidance incorporates the impact of the FCB/First Chatham acquisition effective May 1, 2025.