Old National Bancorp Reports $140.6 Million Net Income in Q1 2025

Old National Bancorp reported a net income of $140.6 million for the first quarter of 2025, translating to $0.44 per diluted share, a decrease from $149.8 million or $0.47 per diluted share in the previous quarter. The results were impacted by $5.9 million in pre-tax merger-related expenses and $0.1 million in net securities losses. Adjusted for these items, net income applicable to common shares was $145.5 million, or $0.45 per diluted share, compared to $156.0 million, or $0.49 per diluted share in the fourth quarter of 2024. The bank's total assets increased to $53.9 billion, up from $53.6 billion at the end of 2024, driven by growth in loans and deposits.

Total loans, excluding loans held-for-sale, rose by $128.1 million, or 1.4% annualized, to $36.4 billion, while total deposits increased by $211 million, or 2.1% annualized, to $41.0 billion. The bank's net interest income decreased slightly to $387.6 million, reflecting lower accretion income and fewer days in the quarter, despite a decrease in funding costs. The provision for credit losses was $31.4 million, up from $27 million in the previous quarter, indicating a cautious approach to potential credit risks amid changing economic conditions.

Operationally, Old National completed its acquisition of CapStar Financial Holdings on April 1, 2024, enhancing its presence in Nashville and other high-growth markets. The bank has also entered into a definitive agreement to acquire Bremer Financial Corporation, with the transaction expected to close on May 1, 2025. The merger has been approved by both companies' boards and received necessary regulatory approvals. The integration of CapStar is anticipated to contribute positively to Old National's growth trajectory.

In terms of credit quality, the bank reported an increase in nonaccrual loans to $469.2 million, representing 1.29% of total loans, up from 1.23% at the end of 2024. The allowance for credit losses on loans was $401.9 million, or 1.10% of total loans, reflecting management's proactive stance in addressing potential credit challenges. Old National's capital ratios remain strong, with a Tier 1 capital ratio of 12.23% and a total capital ratio of 13.68%, both exceeding regulatory minimums.

Looking ahead, Old National anticipates continued growth in loans and deposits, supported by its strategic acquisitions and disciplined expense management. The bank remains focused on maintaining strong credit quality and managing interest rate risk effectively, as it navigates the evolving economic landscape.