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Sep 30
1st Source Q3 2025 Earnings Report
1st Source Corporation reported record third quarter results with increased net income and diluted EPS, alongside continued net interest margin expansion.
Key Takeaways
1st Source Corporation achieved record net income of $42.30 million for the third quarter of 2025, a 21.06% increase from the prior year, and diluted net income per common share of $1.71, up 21.28%. The company experienced solid growth in net interest income and an expanded net interest margin, while also seeing a decrease in nonperforming assets.
Net income reached a record $42.30 million, increasing 21.06% year-over-year.
Diluted net income per common share was $1.71, a 21.28% increase compared to the third quarter of 2024.
Tax-equivalent net interest margin expanded to 4.09%, up 45 basis points from the prior year's third quarter.
Nonperforming assets to loans and leases decreased to 0.91% from 1.06% in the previous quarter, indicating improved credit quality.
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 anticipates continued strong financial performance, driven by strategic leadership transitions and ongoing commitment to disciplined financial management. They expect to maintain a resilient balance sheet and conservative capital structure to navigate macroeconomic uncertainties.
Positive Outlook
- Continued net interest margin expansion for the seventh consecutive quarter.
- Improved credit quality with a decrease in nonperforming asset levels.
- Resilient balance sheet and solid financial foundation, supporting business operations.
- Maintenance of strong liquidity and a historically conservative capital structure.
- Successful senior leadership transition with new CEO and Executive Chairman roles.
Challenges Ahead
- Realized losses from strategic repositioning trades in the investment portfolio.
- Higher noninterest expense due to increased salaries, incentive compensation, and a charitable contribution.
- Decreased equipment rental income due to declining demand for operating leases.
- Lower interest rate swap fees and a decline in bank owned life insurance policy claims recognized.
- Ongoing macroeconomic uncertainty affecting customers and their industries.