Cass Information Systems Reports 25.4% Increase in Net Income for Q1 2025

Cass Information Systems, Inc. reported its financial results for the first quarter of 2025, revealing a net income of $8.966 million, a 25.4% increase from $7.152 million in the same period last year. The company’s diluted earnings per share rose to $0.66, up from $0.52 in the prior year. Total net revenue for the quarter was $46.407 million, reflecting a 2.9% increase compared to $45.105 million in the first quarter of 2024. This growth was primarily driven by a 17% increase in net interest income, which reached $19.274 million, attributed to an improved net interest margin of 3.75% and an increase in average interest-earning assets.

In terms of operational changes, Cass announced the signing of an Asset Purchase Agreement on April 7, 2025, to sell its telecom expense management and managed mobility solutions business unit to Asignet USA Inc. for $18 million. This strategic decision marks a significant shift for the company as it exits the telecom expense management sector. The transaction is expected to close in the second quarter of 2025, pending certain conditions. Additionally, the company recorded a bad debt recovery of $2 million related to a litigation settlement, which positively impacted its operating expenses, which decreased by 1.9% to $35.530 million.

The company’s loan portfolio increased by $59.9 million, or 5.5%, to $1.142 billion as of March 31, 2025, driven by growth in commercial and industrial loans as well as faith-based loans. However, the company experienced a decline in transportation invoice volumes, which fell by 4.7%, leading to a decrease in processing fees. The average payments in advance of funding also decreased by 15.9%, reflecting a 3.3% decline in transportation dollar volumes. Total deposits increased by 3.3% to $1 billion, primarily due to a rise in noninterest-bearing deposits.

Looking ahead, Cass Information Systems anticipates that cash and cash equivalents, along with maturing investments and cash from operations, will be sufficient to fund its operations and capital expenditures in 2025, estimated to range from $6 million to $8 million. The company continues to monitor market conditions, including interest rates and economic activity, which could impact its revenue and profitability. The management remains focused on strategic initiatives to enhance operational efficiency and drive growth in its core business segments.