Peoples Bancorp (PEBO) Q1 2025 earnings summary

Executive summary

• Net income for Q1 2025 was $24.3 million, or $0.68 diluted EPS, down from $29.6 million ($0.84/share) in Q1 2024 and $26.9 million ($0.76/share) in Q4 2024, with one-time costs reducing EPS by $0.05.

• Annualized loan growth exceeded 4%, with deposit balances up 2% sequentially and a reduction in brokered CDs by $96 million.

• Book value per share increased 2% to $31.90 and tangible book value per share rose 4% to $20.68.

• Asset quality improved: net charge-off rate declined to 52 bps, non-performing assets and criticized/classified loans decreased.

• Quarterly dividend increased for the 10th consecutive year, now $0.41 per share (annualized yield 5.95%).

Financial highlights

• Net interest income was $85.3 million, down $1.3 million sequentially and $1.4 million year-over-year; core net interest margin expanded 3 bps to 4.12%.

• Fee-based income grew over 2%, driven by insurance commissions; non-interest income (excluding gains/losses) increased $0.6 million sequentially.

• Non-interest expense increased slightly due to $2M in one-time Q1 costs (stock-based compensation and HSA contributions), impacting EPS by 5 cents.

• Efficiency ratio rose to 60.7% from 59.6% in Q4 2024 and 58.1% in Q1 2024.

• Allowance for credit losses increased to 1.01% of total loans, up nearly $2M, reflecting higher reserves and macroeconomic factors.

Outlook and guidance

• Full-year 2025 net interest margin expected between 4.00% and 4.20%, assuming two 25 bps Fed rate cuts.

• Loan growth projected at 4% to 6% for 2025; provision for credit losses to normalize in H2 2025 after elevated Q1 and Q2.

• Fee-based income growth projected in mid-single digits year-over-year.

• Quarterly non-interest expense guidance for Q2–Q4: $69M–$71M.

• Management expects continued pressure on net interest margin due to lower accretion income and competitive deposit pricing.