Origin Bancorp, Inc. reported net income of $14.6 million, or $0.47 diluted earnings per share, for the quarter ended June 30, 2025. This compares to net income of $22.4 million, or $0.71 diluted earnings per share, in the first quarter of 2025.
Pre-tax, pre-provision earnings were $21.5 million, down from $32.0 million in the linked quarter. Net interest income increased by $3.7 million, or 4.7%, to $82.1 million compared to the first quarter of 2025.
The fully tax-equivalent net interest margin (NIM-FTE) expanded significantly by 17 basis points sequentially to 3.61%, and by 44 basis points year-over-year. This was supported by a favorable shift in asset mix, with total loans representing 83.6% of average interest-earning assets.
The company executed a second bond portfolio optimization strategy, selling $215.8 million in lower-yielding securities and purchasing $201.8 million in higher-yielding ones. This resulted in a $14.4 million loss and a $0.35 negative impact to diluted EPS in Q2, but is expected to generate an estimated annual increase in net interest income of $5.6 million.
Noninterest income decreased by $14.2 million, or 91.2%, to $1.4 million from the linked quarter, primarily due to the $14.4 million loss on sales of securities from the bond portfolio optimization. Noninterest expense decreased slightly by $85,000, or 0.1%, to $62.0 million, primarily due to cost savings from branch closures.
Credit quality saw past due loans decrease by $30.1 million, but nonperforming loans held for investment (LHFI) increased by $3.9 million to 1.11% of total LHFI. A credit loss provision expense of $2.9 million was recorded. The company also redeemed $70.0 million in subordinated debentures during Q1 2025 as part of its "Optimize Origin" initiatives.
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