First Foundation Inc. reported a net income of $6.9 million, or $0.08 per share, for the first quarter of 2025, marking a return to profitability. The adjusted earnings per share for the quarter were $0.09. This positive financial outcome reflects the initial success of the company's strategic balance sheet repositioning.
The net interest margin (NIM) significantly expanded to 1.67% in Q1 2025, up from 1.58% in the previous quarter and 1.17% in Q1 2024. This improvement was primarily driven by a decrease in interest expense on interest-bearing liabilities, which outpaced a smaller decrease in interest income. The company strategically reduced $400 million in higher-cost brokered deposits, partially offset by a $71 million increase in core balances.
Noninterest income increased to $19.6 million from $12.7 million in Q1 2024, boosted by a $4.5 million increase in gains on the sale of available-for-sale securities and a $2.0 million increase in capital markets income. The provision for credit losses was significantly lower at $3.4 million, compared to $20.6 million in Q4 2024. Nonaccrual loans decreased to $38.7 million, and the consolidated CET1 ratio stood strong at 10.6%.
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