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Mar 31, 2022
1st Source Q1 2022 Earnings Report
Reported a decrease in net income compared to the same quarter last year, but average loans grew and net interest margin increased when adjusted for PPP loans.
Key Takeaways
1st Source Corporation reported a decrease in net income for the first quarter of 2022, down 2.54% from the first quarter of 2021. However, average loans and leases net of PPP loans grew, and the net interest margin increased when adjusted for the impact of PPP loans. The company also declared a cash dividend of $0.31 per common share, up 3.33% from the previous year.
Net income was $27.39 million, down 2.54% from Q1 2021.
Diluted net income per common share was $1.10, equal to Q1 2021.
Cash dividend of $0.31 per common share was approved, up 3.33% year-over-year.
Average loans and leases net of PPP loans grew $185.66 million, up 3.65% year-over-year.
Revenue by Segment
Forward Guidance
The Federal Reserve's interest rate increase and signaling of additional increases may contribute to some relief for the margin, which continues to experience pressure from the low interest rate environment.
Positive Outlook
- Federal Reserve's 25 basis point interest rate increase during the quarter
- Signaling of additional rate increases throughout the remainder of 2022
- Potential relief for the margin
- Stable loan and lease quality
- Plan to work through the remaining PPP loan balances in the second quarter
Challenges Ahead
- Expected reduction in PPP loan fees
- Reduction in mortgage income
- Continued challenges of the COVID-19 pandemic
- Economic uncertainty stemming from the war in Ukraine
Historical Earnings Impact
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Avg. Return Before/After Earnings
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