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Jun 30
1st Source Q2 2025 Earnings Report
1st Source Corporation reported its second quarter results for 2025, with net income slightly down from the previous quarter but up year-over-year, and a cash dividend declared.
Key Takeaways
1st Source Corporation reported a net income of $37.32 million for the second quarter of 2025, a slight decrease from the previous quarter but an increase of 1.43% compared to the same period last year. Diluted EPS was $1.51. The company experienced solid growth in net interest income, offset by higher provision for credit losses and realized losses from strategic investment portfolio repositioning.
Net income for Q2 2025 was $37.32 million, a 1.43% increase from Q2 2024.
Diluted net income per common share was $1.51, up 1.34% from $1.49 in Q2 2024.
Tax-equivalent net interest income increased by 15.03% year-over-year to $85.35 million.
Provision for credit losses significantly increased to $7.69 million, compared to a recovery of $0.31 million in Q2 2024.
1st Source
1st Source
1st Source Revenue by Segment
Revenue by Segment
Trust and Wealth Advisory Revenue
CapyFin.comService Charges on Deposit Accounts Revenue
CapyFin.comDebit Card Revenue
CapyFin.comMortgage Banking Revenue
CapyFin.comInsurance Commissions Revenue
CapyFin.comEquipment Rental Revenue
CapyFin.comLosses on Investment Securities Available-for-Sale Revenue
CapyFin.comOther Revenue
CapyFin.com Forward Guidance
The company is pleased with its strong start to 2025, achieving a sixth consecutive quarter of margin expansion despite economic uncertainty. They anticipate continued challenges in credit but maintain a healthy balance sheet and solid liquidity.
Positive Outlook
- Achieved a sixth consecutive quarter of margin expansion.
- Higher rates on investment securities contributed to increased net interest income.
- Increased average loan and lease balances supported revenue growth.
- Lower deposit costs positively impacted net interest margin.
- Balance sheet remained healthy and well-positioned for economic uncertainty.
Challenges Ahead
- Credit was challenged during the quarter with elevated net charge-offs.
- Majority of net charge-offs were from one Auto and Light Truck account.
- Nonperforming assets to loans and leases increased significantly.
- Increased provision for credit losses due to weakened forward economic outlook.
- Realized losses from the sale of available-for-sale securities impacted noninterest income.