Origin Bancorp (OBK) Q2 2025 earnings summary

Executive summary

• Net income for Q2 2025 was $14.6 million ($0.47 diluted EPS), down from $22.4 million ($0.71 EPS) in Q1 2025 and down 30.2% year-over-year; PTPP earnings were $21.5 million, down from $32.0 million sequentially.

• Optimize Origin initiative targets >1% ROAA run rate by Q4 2025, with annual PTPP earnings improvement estimated at $34.2 million, up $10.8 million from prior guidance.

• Strategic actions include branch consolidation, headcount reduction, mortgage restructuring, and securities optimization, contributing to efficiency gains.

• Increased ownership in Argent Financial Group to 20%, expected to add $6 million in income in 2026 and shift to equity method accounting.

• 136,399 shares repurchased in Q2 2025 at an average price of $31.84–$32.13; new $50 million repurchase program authorized in July 2025.

Financial highlights

• Net interest income reached $82.1 million, up 4.7% from Q1 2025 and 11.2% year-over-year, marking a nine-quarter high.

• NIM-FTE expanded 17 bps sequentially and 44 bps year-over-year to 3.61%, aided by asset mix shift and lower liability costs.

• Total loans held for investment were $7.68 billion, up 1.3% sequentially and 1.5% since December 2024; total deposits declined 2.6% sequentially to $8.12 billion.

• Noninterest income dropped sharply to $1.4 million, mainly due to a $14.4 million loss on securities sales.

• Book value per share increased to $38.62, up 2.3% from Q1 and 5.2% since year-end 2024; tangible book value per share rose to $33.33.

Outlook and guidance

• Targeting >1% ROAA run rate by Q4 2025, with top quartile peer performance as the ultimate goal.

• Loan and deposit growth guidance reduced to low single digits for 2025.

• NIM guidance for Q4 2025 is 3.70% ±5 bps, and for 2025 is 3.55% ±5 bps.

• Noninterest income guidance (excluding notable items) increased to low double-digit growth for Q4 2025 over Q4 2024; noninterest expense expected flat to down slightly in 2025.

• Expense run rate expected to remain flat in the back half of 2025; tax rate expected around 21%.