First Busey (BUSE) Q3 2024 earnings summary

Executive summary

• Adjusted net income for Q3 2024 was $33.5M ($0.58 per diluted share), with reported net income at $32.0M and diluted EPS of $0.55; asset quality remained strong and capital ratios robust.

• Announced a transformative merger with CrossFirst Bankshares, expected to create a $20B asset institution across 10 states, with integration planning underway and minimal branch overlap.

• Completed the M&M Bank acquisition in April 2024, expanding the Chicago market and adding $15.6M in goodwill.

• Noninterest income comprised about 30% of operating revenue, driven by record Wealth Management and payment technology segments.

• Tangible book value per share rose 20.7% year-over-year to $18.19.

Financial highlights

• Net interest income was $82.5M in Q3 2024, up 6.1% year-over-year; net interest margin was 3.02%.

• Noninterest income for Q3 2024 was $36.0M, up 15.9% year-over-year, with Wealth Management and FirsTech generating 60.4% of noninterest income.

• Noninterest expense was $75.9M; adjusted efficiency ratio improved to 60.5%.

• Allowance for credit losses was $85.0M, or 1.09% of portfolio loans; net charge-offs were $0.2M.

• Total assets were $12.0B as of September 30, 2024; total deposits were $9.94B, with core deposits at 96.5%.

Outlook and guidance

• The CrossFirst merger is expected to close in 1H25, creating a $20B asset bank with minimal tangible book value dilution and a ~6 month earnback period.

• Management anticipates continued focus on expense control and full run-rate M&A synergies from the M&M acquisition by 1Q25.

• Loan growth is expected to remain modest due to conservative underwriting and economic outlook.

• Pro forma capital ratios at closing are projected to remain well above regulatory minimums (CET1 11.0%, Total Capital 14.1%).

• Management remains confident in balance sheet strength, profitability, and growth heading into 2025.