• HomeTrust Bancshares, Inc. Announces Financial Results for the Fourth Quarter of the Year Ending December 31, 2024 and Quarterly Dividend

    Source: Nasdaq GlobeNewswire / 23 Jan 2025 10:07:13   America/Chicago

    ASHEVILLE, N.C., Jan. 23, 2025 (GLOBE NEWSWIRE) -- HomeTrust Bancshares, Inc. (NASDAQ: HTBI) ("Company"), the holding company of HomeTrust Bank ("Bank"), today announced preliminary net income for the fourth quarter of the year ending December 31, 2024 and approval of its quarterly cash dividend.

    For the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024:

    • net income was $14.2 million compared to $13.1 million;
    • diluted earnings per share ("EPS") was $0.83 compared to $0.76;
    • annualized return on assets ("ROA") was 1.27% compared to 1.17%;
    • annualized return on equity ("ROE") was 10.32% compared to 9.76%;
    • net interest margin was 4.09% compared to 4.00%;
    • provision for credit losses was a benefit of $855,000 compared to a provision of $3.0 million; and
    • quarterly cash dividends increased $0.01 per share, or 9.09%, to $0.12 per share totaling $2.1 million compared to $0.11 per share totaling $1.9 million.

    For the year ended December 31, 2024 compared to the year ended December 31, 2023:

    • net income was $54.8 million compared to $50.0 million;
    • diluted EPS was $3.20 compared to $2.97;
    • ROA was 1.23% compared to 1.17%;
    • ROE was 10.37% compared to 10.62%;
    • net interest margin was 4.05% compared to 4.22%;
    • provision for credit losses was $7.5 million compared to $15.1 million; and
    • cash dividends of $0.45 per share totaling $7.7 million compared to $0.41 per share totaling $6.9 million.

    Results for the year ended December 31, 2023 includes the impact of the merger of Quantum Capital Corp. ("Quantum") into the Company effective February 12, 2023. The addition of Quantum contributed total assets of $656.7 million, including loans of $561.9 million, and $570.6 million of deposits, all reflecting the impact of purchase accounting adjustments. Merger-related expenses of $4.7 million were recognized during the year ended December 31, 2023, while a $5.3 million provision for credit losses was recognized during the same period to establish allowances for credit losses on both Quantum's loan portfolio and off-balance-sheet credit exposure.

    The Company also announced today that its Board of Directors declared a quarterly cash dividend of $0.12 per common share payable on February 27, 2025 to shareholders of record as of the close of business on February 13, 2025.

    “Fiscal year 2024 ended with another quarter of strong financial results,” said Hunter Westbrook, President and Chief Executive Officer. “We reported our tenth consecutive quarter with a net interest margin at or above 4.00% and have grown our tangible book value per share by 11% over the past year. I am convinced our ability to deliver strong financial results is directly correlated to creating a nationally and regionally recognized best place to work. Building on the recognition received in 2024, we recently announced we were named a 2025 America’s Best Workplace as well as 2025 Best Place to Work in Tennessee and Virginia by the Best Companies Group.

    “During the quarter, the Bank engaged a consultant to assist in the renewal of our largest core IT processing contract, which resulted in the recognition of $3 million in consulting expense. This renewal will result both in future cost savings and the expansion of our technology solutions, supporting the Company’s growth initiatives and digital strategies all with the goal of enhancing the customer experience.

    “Lastly, it’s hard to believe it’s been almost four months since Hurricane Helene impacted a portion of the communities we live in and serve. I continue to be amazed and impressed by the resilience of our teammates and customers, and with recovery well underway, we remain committed to working with those in the affected areas.”

    WEBSITE: WWW.HTB.COM

    Comparison of Results of Operations for the Three Months Ended December 31, 2024 and September 30, 2024
    Net Income.  Net income totaled $14.2 million, or $0.83 per diluted share, for the three months ended December 31, 2024 compared to $13.1 million, or $0.76 per diluted share, for the three months ended September 30, 2024, an increase of $1.1 million, or 8.4%. The results for the three months ended December 31, 2024 compared to the quarter ended September 30, 2024 were positively impacted by an increase of $1.1 million in net interest income and a decrease of $3.8 million in the provision for credit losses, partially offset by a $3.4 million increase in noninterest expense. Details of the changes in the various components of net income are further discussed below.

    Net Interest Income.  The following table presents the distribution of average assets, liabilities and equity, as well as interest income earned on average interest-earning assets and interest expense paid on average interest-bearing liabilities. All average balances are daily average balances. Nonaccruing loans have been included in the table as loans carrying a zero yield.

     Three Months Ended
     December 31, 2024 September 30, 2024
    (Dollars in thousands)Average
    Balance
    Outstanding    		 Interest
    Earned/
    Paid    		 Yield/
    Rate    		 Average
    Balance
    Outstanding    		 Interest
    Earned/
    Paid    		 Yield/
    Rate
    Assets           
    Interest-earning assets           
    Loans receivable(1)$3,890,775  $62,224 6.36%  $3,899,460  $63,305 6.46% 
    Debt securities available for sale 147,023   1,621 4.39   140,246   1,616 4.58 
    Other interest-earning assets(2) 160,064   2,353 5.85   144,931   1,728 4.74 
    Total interest-earning assets 4,197,862   66,198 6.27   4,184,637   66,649 6.34 
    Other assets 263,750       264,579     
    Total assets$4,461,612      $4,449,216     
    Liabilities and equity           
    Interest-bearing liabilities           
    Interest-bearing checking accounts$559,033  $1,271 0.90%  $548,024  $1,278 0.93% 
    Money market accounts 1,343,609   10,038 2.97   1,335,798   10,757 3.20 
    Savings accounts 180,546   40 0.09   182,618   40 0.09 
    Certificate accounts 1,005,914   11,225 4.44   1,012,765   11,617 4.56 
    Total interest-bearing deposits 3,089,102   22,574 2.91   3,079,205   23,692 3.06 
    Junior subordinated debt 10,104   223 8.78   10,079   235 9.28 
    Borrowings 14,689   196 5.31   40,399   648 6.38 
    Total interest-bearing liabilities 3,113,895   22,993 2.94   3,129,683   24,575 3.12 
    Noninterest-bearing deposits 731,745       719,710     
    Other liabilities 68,261       65,097     
    Total liabilities 3,913,901       3,914,490     
    Stockholders' equity 547,711       534,726     
    Total liabilities and stockholders' equity$4,461,612      $4,449,216     
    Net earning assets$1,083,967      $1,054,954     
    Average interest-earning assets to average interest-bearing liabilities 134.81%       133.71%     
    Non-tax-equivalent           
    Net interest income  $43,205     $42,074  
    Interest rate spread    3.33%      3.22% 
    Net interest margin(3)    4.09%      4.00% 
    Tax-equivalent(4)           
    Net interest income  $43,594     $42,442  
    Interest rate spread    3.37%      3.25% 
    Net interest margin(3)    4.13%      4.03% 

    (1) Average loans receivable balances include loans held for sale and nonaccruing loans.
    (2) Average other interest-earning assets consist of FRB stock, FHLB stock, SBIC investments and deposits in other banks.
    (3) Net interest income divided by average interest-earning assets.
    (4) Tax-equivalent results include adjustments to interest income of $389 and $368 for the three months ended December 31, 2024 and September 30, 2024, respectively, calculated based on a combined federal and state tax rate of 24%.

    Total interest and dividend income for the three months ended December 31, 2024 decreased $451,000, or 0.7%, compared to the three months ended September 30, 2024, which was driven by a $1.1 million decrease in loan interest income, partially offset by a $625,000 increase in interest income on other investments and interest-bearing accounts. Accretion income on acquired loans of $1.2 million and $640,000 was recognized during the same periods, respectively, and was included in loan interest income.

    Total interest expense for the three months ended December 31, 2024 decreased $1.6 million, or 6.4%, compared to the three months ended September 30, 2024, the result of a $1.1 million, or 4.7%, decrease in interest expense on deposits and a $452,000, or 69.8%, decrease in interest expense on borrowings. The decrease in interest expense on deposits can primarily be traced to decreases in the average cost of funds, while the decrease in interest expense on borrowings was the result of a decline in average borrowings outstanding.

    The following table shows the effects that changes in average balances (volume), including differences in the number of days in the periods compared, and average interest rates (rate) had on the interest earned on interest-earning assets and interest paid on interest-bearing liabilities:

     Increase / (Decrease)
    Due to    		 Total
    Increase/
    (Decrease)
    (Dollars in thousands)Volume Rate 
    Interest-earning assets     
    Loans receivable$(141)  $(940)  $(1,081) 
    Debt securities available for sale 78   (73)   5 
    Other interest-earning assets 180   445   625 
    Total interest-earning assets 117   (568)   (451) 
    Interest-bearing liabilities     
    Interest-bearing checking accounts 26   (33)   (7) 
    Money market accounts 63   (782)   (719) 
    Savings accounts —   —   — 
    Certificate accounts (79)   (313)   (392) 
    Junior subordinated debt 1   (13)   (12) 
    Borrowings (412)   (40)   (452) 
    Total interest-bearing liabilities (401)   (1,181)   (1,582) 
    Increase in net interest income    $1,131 

    Provision for Credit Losses.  The provision for credit losses is the amount of expense that, based on our judgment, is required to maintain the allowance for credit losses ("ACL") at an appropriate level under the current expected credit losses model.

    The following table presents a breakdown of the components of the provision for credit losses:

     Three Months Ended    
    (Dollars in thousands)December 31, 2024 September 30, 2024 $ Change % Change
    Provision for credit losses       
    Loans$(975)  $2,990  $(3,965)  (133)%
    Off-balance-sheet credit exposure 120   (15)   135  900
    Total provision (benefit) for credit losses$(855)  $2,975  $(3,830)  (129)%

    For the quarter ended December 31, 2024, the "loans" portion of the provision for credit losses was primarily the result of the following, offset by net charge-offs of $1.9 million during the quarter:

    • $1.3 million benefit driven by changes in the loan mix and a $50.6 million decrease in the loan portfolio.
    • $0.7 million benefit due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments. Of note, we retained the $2.2 million qualitative allocation for the potential impact of Hurricane Helene upon our loan portfolio established in the prior quarter.
    • $0.9 million decrease in specific reserves on individually evaluated credits.

    For the quarter ended September 30, 2024, the "loans" portion of the provision for credit losses was the result of the following, offset by net charge-offs of $4.1 million during the quarter:

    • $0.4 million benefit driven by changes in the loan mix.
    • $1.2 million provision due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments. Included in this change was the addition of a $2.2 million qualitative allocation for the potential impact of Hurricane Helene upon our loan portfolio.
    • $1.9 million decrease in specific reserves on individually evaluated loans as we charged-off specific reserves which had previously been established.

    For the quarters ended December 31, 2024 and September 30, 2024, the amounts recorded for off-balance-sheet credit exposure were the result of changes in the balance of loan commitments, loan mix and the projected economic forecast as outlined above.

    Noninterest Income.  Noninterest income for the three months ended December 31, 2024 decreased $39,000, or 0.5%, when compared to the quarter ended September 30, 2024. Changes in the components of noninterest income are discussed below:

     Three Months Ended  
    (Dollars in thousands)December 31, 2024 September 30, 2024 $ Change % Change
    Noninterest income       
    Service charges and fees on deposit accounts$2,326 $2,336 $(10)  —% 
    Loan income and fees 728  684  44  6 
    Gain on sale of loans held for sale 1,068  1,900  (832)  (44) 
    Bank owned life insurance ("BOLI") income 842  828  14  2 
    Operating lease income 2,259  1,637  622  38 
    Other 1,020  897  123  14 
    Total noninterest income$8,243 $8,282 $(39)  —% 
    • Gain on sale of loans held for sale: The decrease was driven by declines in the volume of HELOCs, Small Business Administration ("SBA") commercial loans, and residential mortgage loans sold during the period. There were $23.8 million of residential mortgages originated for sale sold during the current quarter with gains of $269,000 compared to $21.7 million sold with gains of $479,000 in the prior quarter, with the decrease in profitability due to movement in interest rates. There were $10.2 million in sales of the guaranteed portion of SBA commercial loans with gains of $733,000 for the current quarter compared to $12.9 million sold and gains of $1.0 million for the prior quarter. No HELOCs were sold during the current quarter compared to $54.6 million sold with gains of $414,000 in the prior quarter. Lastly, our hedging of mandatory commitments on the residential mortgage loan pipeline resulted in gains of $66,000 and $18,000 in the same periods, respectively.
    • Operating lease income: The increase was primarily the result of a $136,000 decrease in losses incurred on the sale of, and a $475,000 reduction in the valuation allowance against, previously leased equipment.

    Noninterest Expense.  Noninterest expense for the three months ended December 31, 2024 increased $3.4 million, or 11.2%, when compared to the three months ended September 30, 2024. Changes in the components of noninterest expense are discussed below:

     Three Months Ended  
    (Dollars in thousands)December 31, 2024 September 30, 2024 $ Change % Change
    Noninterest expense       
    Salaries and employee benefits$17,234 $17,082 $152  1% 
    Occupancy expense, net 2,476  2,436  40  2 
    Computer services 3,110  3,192  (82)  (3) 
    Operating lease depreciation expense 2,068  2,101  (33)  (2) 
    Telephone, postage and supplies 541  547  (6)  (1) 
    Marketing and advertising 234  408  (174)  (43) 
    Deposit insurance premiums 556  589  (33)  (6) 
    Core deposit intangible amortization 567  567  —  — 
    Contract renewal consulting fee 2,965  —  2,965  100 
    Other 4,258  3,663  595  16 
    Total noninterest expense$34,009 $30,585 $3,424  11% 
    • Marketing and advertising: The decrease is the result of a reduction in advertising in the current quarter in response to the election, and the holiday season.
    • Contract renewal consulting fee: In the current quarter we paid a fee to a consultant to negotiate the multiyear renewal of our largest core processing contract.
    • Other: The increase is primarily the result of referral fees paid to expand our community association banking deposit line of business.

    Income Taxes.  The amount of income tax expense is influenced by the amount of pre-tax income, tax-exempt income, changes in the statutory rate and the effect of changes in valuation allowances maintained against deferred tax benefits. The effective tax rates for the three months ended December 31, 2024 and September 30, 2024 were 22.3% and 21.9%, respectively.

    Comparison of Results of Operations for the Years Ended December 31, 2024 and December 31, 2023
    Net Income.  Net income totaled $54.8 million, or $3.20 per diluted share, for the year ended December 31, 2024 compared to $50.0 million, or $2.97 per diluted share, for the year ended December 31, 2023, an increase of $4.8 million, or 9.5%. The results for the year ended December 31, 2024 compared to the prior year were positively impacted by a $7.6 million decrease in the provision for credit losses and a $1.4 million increase in noninterest income, partially offset by a $758,000 decrease in net interest income and a $1.6 million increase in noninterest expense. Details of the changes in the various components of net income are further discussed below.

    Net Interest Income.  The following table presents the distribution of average assets, liabilities and equity, as well as interest income earned on average interest-earning assets and interest expense paid on average interest-bearing liabilities. All average balances are daily average balances. Nonaccruing loans have been included in the table as loans carrying a zero yield.

     Years Ended December 31,
      2024   2023 
    (Dollars in thousands)Average
    Balance
    Outstanding    		 Interest
    Earned/
    Paid    		 Yield/
    Rate    		 Average
    Balance
    Outstanding    		 Interest
    Earned/
    Paid    		 Yield/
    Rate
    Assets           
    Interest-earning assets           
    Loans receivable(1)$3,884,984  $247,642 6.37%  $3,732,796  $222,595 5.96% 
    Debt securities available for sale 137,108   6,045 4.41   151,110   5,037 3.33 
    Other interest-earning assets(2) 144,262   7,929 5.50   133,108   6,849 5.15 
    Total interest-earning assets 4,166,354   261,616 6.28   4,017,014   234,481 5.84 
    Other assets 273,307       268,102     
    Total assets$4,439,661      $4,285,116     
    Liabilities and equity           
    Interest-bearing liabilities           
    Interest-bearing checking accounts$570,952  $5,420 0.95%  $619,034  $4,450 0.72% 
    Money market accounts 1,314,867   40,680 3.09   1,217,474   27,534 2.26 
    Savings accounts 185,712   164 0.09   213,601   188 0.09 
    Certificate accounts 952,602   42,003 4.41   692,338   23,072 3.33 
    Total interest-bearing deposits 3,024,133   88,267 2.92   2,742,447   55,244 2.01 
    Junior subordinated debt 10,067   928 9.22   8,826   802 9.09 
    Borrowings 61,205   3,746 6.12   158,374   9,002 5.68 
    Total interest-bearing liabilities 3,095,405   92,941 3.00   2,909,647   65,048 2.24 
    Noninterest-bearing deposits 757,472       852,207     
    Other liabilities 58,496       52,155     
    Total liabilities 3,911,373       3,814,009     
    Stockholders' equity 528,288       471,107     
    Total liabilities and stockholders' equity$4,439,661      $4,285,116     
    Net earning assets$1,070,949      $1,107,367     
    Average interest-earning assets to average interest-bearing liabilities 134.60%       138.06%     
    Non-tax-equivalent           
    Net interest income  $168,675     $169,433  
    Interest rate spread    3.28%      3.60% 
    Net interest margin(3)    4.05%      4.22% 
    Tax-equivalent(4)           
    Net interest income  $170,135     $170,677  
    Interest rate spread    3.31%      3.63% 
    Net interest margin(3)    4.08%      4.25% 

    (1) Average loans receivable balances include loans held for sale and nonaccruing loans.
    (2) Average other interest-earning assets consist of FRB stock, FHLB stock, SBIC investments and deposits in other banks.
    (3) Net interest income divided by average interest-earning assets.
    (4) Tax-equivalent results include adjustments to interest income of $1,460 and $1,244 for the years ended December 31, 2024 and 2023, respectively, calculated based on a combined federal and state tax rate of 24%.

    Total interest and dividend income for the year ended December 31, 2024 increased $27.1 million, or 11.6%, compared to the year ended December 31, 2023, which was driven by a $25.0 million increase in loan interest income, a $1.1 million increase in interest income on other investments and interest-bearing accounts, and a $1.0 million increase in interest income on debt securities available for sale. Accretion income on acquired loans of $3.2 million and $2.1 million was recognized during the same periods, respectively, and was included in loan interest income.

    Total interest expense for the year ended December 31, 2024 increased $27.9 million, or 42.9%, compared to the year ended December 31, 2023, the result of a $33.0 million, or 59.8%, increase in interest expense on deposits and a $5.3 million, or 58.4%, decrease in interest expense on borrowings. The increase in interest expense on deposits was primarily the result of both increases in the average cost of funds across funding sources and average deposits, while the decrease in interest expense on borrowings was the result of a decline in average borrowings outstanding.

    The following table shows the effects that changes in average balances (volume), including differences in the number of days in the periods compared, and average interest rates (rate) had on the interest earned on interest-earning assets and interest paid on interest-bearing liabilities:

     Increase / (Decrease)
    Due to    		 Total
    Increase/
    (Decrease)
    (Dollars in thousands)Volume Rate 
    Interest-earning assets     
    Loans receivable$9,075  $15,972 $25,047 
    Debt securities available for sale (467)   1,475  1,008 
    Other interest-earning assets 574   506  1,080 
    Total interest-earning assets 9,182   17,953  27,135 
    Interest-bearing liabilities     
    Interest-bearing checking accounts (346)   1,316  970 
    Money market accounts 2,203   10,943  13,146 
    Savings accounts (25)   1  (24) 
    Certificate accounts 8,673   10,258  18,931 
    Junior subordinated debt 113   13  126 
    Borrowings (5,523)   267  (5,256) 
    Total interest-bearing liabilities 5,095   22,798  27,893 
    Decrease in net interest income    $(758) 

    Provision for Credit Losses.  The following table presents a breakdown of the components of the provision for credit losses:

     Years Ended December 31,  
    (Dollars in thousands) 2024  2023  $ Change % Change
    Provision for credit losses       
    Loans$7,460 $16,170  $(8,710)  (54)%
    Off-balance-sheet credit exposure 85  (1,075)   1,160  108
    Total provision for credit losses$7,545 $15,095  $(7,550)  (50)%

    For the year ended December 31, 2024, the "loans" portion of the provision for credit losses was the result of the following, offset by net charge-offs of $10.8 million during the period:

    • $1.6 million benefit driven by changes in the loan mix.
    • $0.7 million benefit due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments.
    • $1.0 million decrease in specific reserves on individually evaluated credits.

    For the year ended December 31, 2023, the "loans" portion of the provision for credit losses was the result of the following, offset by net charge-offs of $6.7 million during the period:

    • $4.9 million provision to establish an allowance on Quantum's loan portfolio.
    • $1.4 million provision driven by changes in the loan mix.
    • $2.1 million provision due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments.
    • $1.1 million increase in specific reserves on individually evaluated credits.

    For the years ended December 31, 2024 and December 31, 2023, the amounts recorded for off-balance-sheet credit exposure were the result of changes in the balance of loan commitments, loan mix and the projected economic forecast as outlined above.

    Noninterest Income.  Noninterest income for the year ended December 31, 2024 increased $1.4 million, or 4.3%, when compared to the same period last year. Changes in the components of noninterest income are discussed below:

     Years Ended December 31,  
    (Dollars in thousands) 2024   2023 $ Change % Change
    Noninterest income       
    Service charges and fees on deposit accounts$9,165  $9,335 $(170)  (2)% 
    Loan income and fees 2,737   2,336  401  17 
    Gain on sale of loans held for sale 6,253   5,250  1,003  19 
    BOLI income 4,312   4,996  (684)  (14) 
    Operating lease income 7,346   6,107  1,239  20 
    Gain (loss) on sale of premises and equipment (9)   734  (743)  (101) 
    Other 3,645   3,315  330  10 
    Total noninterest income$33,449  $32,073 $1,376  4% 
    • Loan income and fees: The increase was primarily driven by loan servicing income associated with SBA loans.
    • Gain on sale of loans held for sale: The increase was primarily driven by an increase in the premiums received on SBA loans sold during the current period. During the year ended December 31, 2024, there were $48.7 million of sales of the guaranteed portion of SBA commercial loans with gains of $3.9 million compared to $46.7 million sold with gains of $3.0 million during the prior year, with the improvement in profitability due to more favorable pricing on the secondary market. There were $95.4 million of HELOCs sold during the current period with gains of $887,000 compared to $104.0 million sold with gains of $873,000 in the prior year. There were $82.0 million of residential mortgages originated for sale sold with gains of $1.4 million compared to $69.3 million sold with gains of $1.1 million in the prior year. Lastly, our hedging of mandatory commitments on the residential mortgage loan pipeline resulted in gains of $81,000 and $284,000 in the same periods, respectively.
    • BOLI income: The decrease was primarily the result of a $1.5 million decrease in tax-free gains on death benefit proceeds in excess of the cash surrender value of the policies compared to the prior year, partially offset by the impact of higher yielding policies due to the partial restructuring of the portfolio at the end of the prior year.
    • Operating lease income: The increase was the result of $2.1 million in additional contract earnings on a higher average outstanding balance of associated contracts, partially offset by an $805,000 increase in the valuation allowance against previously leased equipment.
    • Gain (loss) on sale of premises and equipment: During the prior year, three properties were sold for a combined net gain of $734,000. No material disposal activity occurred during the year ended December 31, 2024.

    Noninterest Expense.  Noninterest expense for the year ended December 31, 2024 increased $1.6 million, or 1.3%, when compared to the same period last year. Changes in the components of noninterest expense are discussed below:

     Years Ended December 31,  
    (Dollars in thousands) 2024  2023 $ Change % Change
    Noninterest expense       
    Salaries and employee benefits$67,900 $65,692 $2,208  3% 
    Occupancy expense, net 9,768  9,999  (231)  (2) 
    Computer services 12,506  12,388  118  1 
    Operating lease depreciation expense 7,734  5,406  2,328  43 
    Telephone, postage and supplies 2,253  2,545  (292)  (11) 
    Marketing and advertising 1,893  2,180  (287)  (13) 
    Deposit insurance premiums 2,230  2,580  (350)  (14) 
    Core deposit intangible amortization 2,463  3,184  (721)  (23) 
    Merger-related expenses —  4,741  (4,741)  (100) 
    Contract renewal consulting fee 2,965  —  2,965  100 
    Other 14,956  14,374  582  4 
    Total noninterest expense$124,668 $123,089 $1,579  1% 
    • Salaries and employee benefits: The increase was primarily the result of pay increases, partially offset by reductions in incentive pay.
    • Operating lease depreciation expense: The increase was due to a higher average outstanding balance of associated contracts.
    • Core deposit intangible amortization: The intangible recorded associated with the Quantum merger is being amortized on an accelerated basis, so the rate of amortization slowed year-over-year.
    • Merger-related expenses: The prior period included expenses associated with the Company's merger with Quantum. No such expenses were incurred in the year ended December 31, 2024.
    • Contract renewal consulting fee: In the current quarter we paid a fee to a consultant to negotiate the multiyear renewal of our largest core processing contract.

    Income Taxes.  The amount of income tax expense is influenced by the amount of pre-tax income, tax-exempt income, changes in the statutory rate and the effect of changes in valuation allowances maintained against deferred tax benefits. The effective tax rates for the year ended December 31, 2024 and 2023 were 21.6% and 21.0%, respectively.

    Balance Sheet Review
    Total assets decreased by $77.2 million to $4.6 billion and total liabilities decreased by $129.1 million to $4.0 billion at December 31, 2024 as compared to December 31, 2023. The majority of these changes were the result of an increase in deposits, which, combined with the collection of BOLI redemption proceeds and cash and cash equivalents, were used to pay down borrowings.

    Stockholders' equity increased $51.9 million, or 10.4%, to $551.8 million at December 31, 2024 as compared to December 31, 2023. Activity within stockholders' equity included $54.8 million in net income and $5.9 million in stock-based compensation and stock option exercises, partially offset by $7.7 million in cash dividends declared.

    As of December 31, 2024, the Bank was considered "well capitalized" in accordance with its regulatory capital guidelines and exceeded all regulatory capital requirements.

    Asset Quality
    The ACL on loans was $45.3 million, or 1.24% of total loans, at December 31, 2024 compared to $48.6 million, or 1.34% of total loans, at December 31, 2023. The drivers of this change are discussed in the "Comparison of Results of Operations for the Years Ended December 31, 2024 and December 31, 2023 – Provision for Credit Losses" section above.

    Net loan charge-offs totaled $10.8 million for the year ended December 31, 2024 compared to $6.7 million for the prior year. As discussed in previous quarters, the increase in net charge-offs has been concentrated in our equipment finance portfolio, primarily smaller over-the-road truck loans, with net charge-offs of $6.7 million during the year ended December 31, 2024. In response, during the first quarter of calendar year 2024 the Company elected to cease further originations within the transportation sector of equipment finance loans. Annualized net charge-offs as a percentage of average assets for the loan portfolio as a whole were 0.28% and 0.18% for the years ended December 31, 2024 and 2023, respectively.

    Nonperforming assets, made up of nonaccrual loans and repossessed assets, increased by $9.4 million, or 48.8%, to $28.8 million, or 0.63% of total assets, at December 31, 2024 compared to $19.3 million, or 0.41% of total assets, at December 31, 2023. Owner occupied commercial real estate ("CRE") made up the largest portion of nonperforming assets at $8.5 million and $912,000, respectively, at these same dates. Of the December 31, 2024 balance, one relationship made up $5.0 million of the total and a loss is not anticipated. In addition, equipment finance loans made up $4.7 million and $6.5 million, respectively, at these same dates, concentrated in the transportation sector consistent with the change in net charge-offs. The ratio of nonperforming loans to total loans was 0.76% at December 31, 2024 compared to 0.53% at December 31, 2023.

    The ratio of classified assets to total assets increased to 1.06% at December 31, 2024 from 0.88% at December 31, 2023 as classified assets increased $7.6 million to $48.8 million at December 31, 2024 compared to $41.2 million at December 31, 2023. The largest portfolios of classified assets at December 31, 2024 included $11.3 million of non-owner occupied CRE loans, $9.2 million of SBA loans, $7.5 million of equipment finance loans, $6.7 million of 1-4 family residential real estate loans, $5.9 million of owner occupied CRE loans, and $4.7 million of revolving mortgages.

    Lastly, in an effort to assist customers in their post-Hurricane Helene recovery and clean-up efforts, this quarter we granted payment deferrals of up to six months to provide short-term relief to impacted customers. The outstanding balance of these deferrals was $136.0 million at December 31, 2024. As of this same date, the Company maintained the prior quarter $2.2 million ACL allocation for the potential impact of the storm on this portion of our loan portfolio.

    About HomeTrust Bancshares, Inc.
    HomeTrust Bancshares, Inc. is the holding company for the Bank. As of December 31, 2024, the Company had assets of $4.6 billion. The Bank, founded in 1926, is a North Carolina state chartered, community-focused financial institution committed to providing value added relationship banking with over 30 locations as well as online/mobile channels. Locations include: North Carolina (the Asheville metropolitan area, the "Piedmont" region, Charlotte and Raleigh/Cary), South Carolina (Greenville and Charleston), East Tennessee (Kingsport/Johnson City, Knoxville and Morristown), Southwest Virginia (the Roanoke Valley) and Georgia (Greater Atlanta).

    Forward-Looking Statements
    This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact, but instead are based on certain assumptions including statements with respect to the Company's beliefs, plans, objectives, goals, expectations, assumptions and statements about future economic performance and projections of financial items. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated or implied by forward-looking statements. The factors that could result in material differentiation include, but are not limited to, the impact of bank failures or adverse developments involving other banks and related negative press about the banking industry in general on investor and depositor sentiment; the remaining effects of the COVID-19 pandemic on general economic and financial market conditions and on public health, both nationally and in the Company's market areas; natural disasters, including the effects of Hurricane Helene; expected revenues, cost savings, synergies and other benefits from merger and acquisition activities might not be realized to the extent anticipated, within the anticipated time frames, or at all, costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected, and goodwill impairment charges might be incurred; increased competitive pressures among financial services companies; changes in the interest rate environment; changes in general economic conditions, both nationally and in our market areas; legislative and regulatory changes; and the effects of inflation, a potential recession, and other factors described in the Company's latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other documents filed with or furnished to the Securities and Exchange Commission - which are available on the Company's website at www.htb.com and on the SEC's website at www.sec.gov. Any of the forward-looking statements that the Company makes in this press release or in the documents the Company files with or furnishes to the SEC are based upon management's beliefs and assumptions at the time they are made and may turn out to be wrong because of inaccurate assumptions, the factors described above or other factors that management cannot foresee. The Company does not undertake, and specifically disclaims any obligation, to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

    Consolidated Balance Sheets (Unaudited)

    (Dollars in thousands)December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023(1)
    Assets         
    Cash$18,778  $18,980  $18,382  $16,134  $18,307 
    Interest-bearing deposits 260,441   274,497   275,808   364,359   328,833 
    Cash and cash equivalents 279,219   293,477   294,190   380,493   347,140 
    Certificates of deposit in other banks 28,538   29,290   32,131   33,625   34,722 
    Debt securities available for sale, at fair value 152,011   140,552   134,135   120,807   126,950 
    FHLB and FRB stock 13,630   18,384   19,637   13,691   18,393 
    SBIC investments, at cost 15,117   15,489   15,462   14,568   13,789 
    Loans held for sale, at fair value 4,144   2,968   1,614   2,764   3,359 
    Loans held for sale, at the lower of cost or fair value 202,018   189,722   224,976   220,699   198,433 
    Total loans, net of deferred loan fees and costs 3,648,299   3,698,892   3,701,454   3,648,152   3,640,022 
    Allowance for credit losses – loans (45,285)   (48,131)   (49,223)   (47,502)   (48,641) 
    Loans, net 3,603,014   3,650,761   3,652,231   3,600,650   3,591,381 
    Premises and equipment, net 69,872   69,603   69,880   70,588   70,937 
    Accrued interest receivable 18,336   17,523   18,412   16,944   16,902 
    Deferred income taxes, net 10,735   10,100   10,512   11,222   11,796 
    BOLI 90,868   90,021   89,176   88,369   88,257 
    Goodwill 34,111   34,111   34,111   34,111   34,111 
    Core deposit intangibles, net 6,595   7,162   7,730   8,297   9,059 
    Other assets 67,222   68,130   66,667   67,183   107,404 
    Total assets$4,595,430  $4,637,293  $4,670,864  $4,684,011  $4,672,633 
    Liabilities and stockholders' equity         
    Liabilities         
    Deposits$3,779,203  $3,761,588  $3,707,779  $3,799,807  $3,661,373 
    Junior subordinated debt 10,120   10,096   10,070   10,045   10,021 
    Borrowings 188,000   260,013   364,513   291,513   433,763 
    Other liabilities 66,349   65,592   64,874   69,473   67,583 
    Total liabilities 4,043,672   4,097,289   4,147,236   4,170,838   4,172,740 
    Stockholders' equity         
    Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued or outstanding —   —   —   —   — 
    Common stock, $0.01 par value, 60,000,000 shares authorized (2) 175   175   175   175   174 
    Additional paid in capital 176,693   175,495   172,907   172,919   172,366 
    Retained earnings 380,541   368,383   357,147   346,598   333,401 
    Unearned Employee Stock Ownership Plan ("ESOP") shares (3,966)   (4,099)   (4,232)   (4,364)   (4,497) 
    Accumulated other comprehensive income (loss) (1,685)   50   (2,369)   (2,155)   (1,551) 
    Total stockholders' equity 551,758   540,004   523,628   513,173   499,893 
    Total liabilities and stockholders' equity$4,595,430  $4,637,293  $4,670,864  $4,684,011  $4,672,633 

    (1) Derived from audited financial statements.
    (2) Shares of common stock issued and outstanding were 17,527,709 at December 31, 2024; 17,514,922 at September 30, 2024; 17,437,326 at June 30, 2024; 17,444,787 at March 31, 2024; and 17,387,069 at December 31, 2023.

    Consolidated Statements of Income (Unaudited)

     Three Months Ended Years Ended
    (Dollars in thousands)December 31, 2024 September 30, 2024 December 31, 2024 December 31, 2023
    Interest and dividend income       
    Loans$62,224  $63,305 $247,642  $222,595
    Debt securities available for sale 1,621   1,616  6,045   5,037
    Other investments and interest-bearing deposits 2,353   1,728  7,929   6,849
    Total interest and dividend income 66,198   66,649  261,616   234,481
    Interest expense       
    Deposits 22,574   23,692  88,267   55,244
    Junior subordinated debt 223   235  928   802
    Borrowings 196   648  3,746   9,002
    Total interest expense 22,993   24,575  92,941   65,048
    Net interest income 43,205   42,074  168,675   169,433
    Provision (benefit) for credit losses  (855)   2,975  7,545   15,095
    Net interest income after provision (benefit) for credit losses 44,060   39,099  161,130   154,338
    Noninterest income       
    Service charges and fees on deposit accounts 2,326   2,336  9,165   9,335
    Loan income and fees 728   684  2,737   2,336
    Gain on sale of loans held for sale 1,068   1,900  6,253   5,250
    BOLI income 842   828  4,312   4,996
    Operating lease income 2,259   1,637  7,346   6,107
    Gain (loss) on sale of premises and equipment —   —  (9)   734
    Other 1,020   897  3,645   3,315
    Total noninterest income 8,243   8,282  33,449   32,073
    Noninterest expense       
    Salaries and employee benefits 17,234   17,082  67,900   65,692
    Occupancy expense, net 2,476   2,436  9,768   9,999
    Computer services 3,110   3,192  12,506   12,388
    Operating lease depreciation expense 2,068   2,101  7,734   5,406
    Telephone, postage and supplies 541   547  2,253   2,545
    Marketing and advertising 234   408  1,893   2,180
    Deposit insurance premiums 556   589  2,230   2,580
    Core deposit intangible amortization 567   567  2,463   3,184
    Merger-related expenses —   —  —   4,741
    Contract renewal consulting fee 2,965   —  2,965   —
    Other 4,258   3,663  14,956   14,374
    Total noninterest expense 34,009   30,585  124,668   123,089
    Income before income taxes 18,294   16,796  69,911   63,322
    Income tax expense 4,086   3,684  15,106   13,278
    Net income$14,208  $13,112 $54,805  $50,044

    Per Share Data

     Three Months Ended  Years Ended
     December 31, 2024 September 30, 2024 December 31, 2024 December 31, 2023
    Net income per common share(1)       
    Basic$0.83 $0.77 $3.21 $2.98
    Diluted$0.83 $0.76 $3.20 $2.97
    Average shares outstanding       
    Basic 16,983,751  16,931,793  16,914,741  16,604,881
    Diluted 17,084,943  17,027,824  16,977,330  16,622,381
    Book value per share at end of period$31.48 $30.83 $31.48 $28.75
    Tangible book value per share at end of period(2)$29.24 $28.57 $29.24 $26.39
    Cash dividends declared per common share$0.12 $0.11 $0.45 $0.41
    Total shares outstanding at end of period 17,527,709  17,514,922  17,527,709  17,387,069

    (1) Basic and diluted net income per common share have been prepared in accordance with the two-class method.
    (2) See Non-GAAP reconciliations below for adjustments.

    Selected Financial Ratios and Other Data

     Three Months Ended Years Ended
     December 31, 2024 September 30, 2024 December 31, 2024 December 31, 2023
    Performance ratios(1)     
    Return on assets (ratio of net income to average total assets)1.27%  1.17%  1.23%  1.17% 
    Return on equity (ratio of net income to average equity)10.32  9.76  10.37  10.62 
    Yield on earning assets6.27  6.34  6.28  5.84 
    Rate paid on interest-bearing liabilities2.94  3.12  3.00  2.24 
    Average interest rate spread3.33  3.22  3.28  3.60 
    Net interest margin(2)4.09  4.00  4.05  4.22 
    Average interest-earning assets to average interest-bearing liabilities134.81  133.71  134.60  138.06 
    Noninterest expense to average total assets3.03  2.73  2.81  2.87 
    Efficiency ratio66.10  60.74  61.68  61.08 
    Efficiency ratio – adjusted(3)59.89  60.30  60.12  59.36 

    (1)   Ratios are annualized where appropriate.
    (2)   Net interest income divided by average interest-earning assets.
    (3)   See Non-GAAP reconciliations below for adjustments.

     At or For the Three Months Ended
     December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023
    Asset quality ratios         
    Nonperforming assets to total assets(1)0.63%  0.64%  0.54%  0.43%  0.41% 
    Nonperforming loans to total loans(1)0.76  0.78  0.68  0.55  0.53 
    Total classified assets to total assets1.06  0.99  0.91  0.80  0.88 
    Allowance for credit losses to nonperforming loans(1)163.68  166.51  194.80  235.18  251.60 
    Allowance for credit losses to total loans1.24  1.30  1.33  1.30  1.34 
    Net charge-offs to average loans (annualized)0.19  0.42  0.27  0.24  0.29 
    Capital ratios         
    Equity to total assets at end of period12.01%  11.64%  11.21%  10.96%  10.70% 
    Tangible equity to total tangible assets(2)11.25  10.88  10.44  10.18  9.91 
    Average equity to average assets12.28  12.02  11.78  11.51  11.03 

    (1) Nonperforming assets include nonaccruing loans and REO. There were no accruing loans more than 90 days past due at the dates indicated. At December 31, 2024, $13.0 million, or 47.1%, of nonaccruing loans were current on their loan payments.
    (2) See Non-GAAP reconciliations below for adjustments.

    Loans

    (Dollars in thousands)December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023
    Commercial real estate loans         
    Construction and land development$274,356  $300,905  $316,050  $304,727  $305,269 
    Commercial real estate – owner occupied 545,490   544,689   545,631   532,547   536,545 
    Commercial real estate – non-owner occupied 866,094   881,340   892,653   881,143   875,694 
    Multifamily 120,425   114,155   92,292   89,692   88,623 
    Total commercial real estate loans 1,806,365   1,841,089   1,846,626   1,808,109   1,806,131 
    Commercial loans         
    Commercial and industrial 316,159   286,809   266,136   243,732   237,255 
    Equipment finance 406,400   443,033   461,010   462,649   465,573 
    Municipal leases 165,984   158,560   152,509   151,894   150,292 
    Total commercial loans 888,543   888,402   879,655   858,275   853,120 
    Residential real estate loans         
    Construction and land development 53,683   63,016   70,679   85,840   96,646 
    One-to-four family 630,391   627,845   621,196   605,570   584,405 
    HELOCs 195,288   194,909   188,465   184,274   185,878 
    Total residential real estate loans 879,362   885,770   880,340   875,684   866,929 
    Consumer loans 74,029   83,631   94,833   106,084   113,842 
    Total loans, net of deferred loan fees and costs 3,648,299   3,698,892   3,701,454   3,648,152   3,640,022 
    Allowance for credit losses – loans (45,285)   (48,131)   (49,223)   (47,502)   (48,641) 
    Loans, net$3,603,014  $3,650,761  $3,652,231  $3,600,650  $3,591,381 
              

    Deposits

    (Dollars in thousands)December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023
    Core deposits         
    Noninterest-bearing accounts$680,926 $684,501 $683,346 $773,901 $784,950
    NOW accounts 575,238  534,517  561,789  600,561  591,270
    Money market accounts 1,341,995  1,345,289  1,311,940  1,308,467  1,246,807
    Savings accounts 181,317  179,762  185,499  191,302  194,486
    Total core deposits 2,779,476  2,744,069  2,742,574  2,874,231  2,817,513
    Certificates of deposit 999,727  1,017,519  965,205  925,576  843,860
    Total$3,779,203 $3,761,588 $3,707,779 $3,799,807 $3,661,373

    Non-GAAP Reconciliations
    In addition to results presented in accordance with generally accepted accounting principles utilized in the United States ("GAAP"), this earnings release contains certain non-GAAP financial measures, which include: the efficiency ratio, tangible book value, tangible book value per share and the tangible equity to tangible assets ratio. The Company believes these non-GAAP financial measures and ratios as presented are useful for both investors and management to understand the effects of certain items and provide an alternative view of its performance over time and in comparison to its competitors. These non-GAAP measures have inherent limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for total stockholders' equity or operating results determined in accordance with GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

    Set forth below is a reconciliation to GAAP of the Company's efficiency ratio:

     Three Months Ended Years Ended
    (Dollars in thousands)December 31, 2024 September 30, 2024 December 31, 2024 December 31, 2023
    Noninterest expense$34,009 $30,585 $124,668  $123,089
    Less: merger-related expenses —  —  —   4,741
    Less: contract renewal consulting fee 2,965  —  2,965   —
    Noninterest expense – adjusted$31,044 $30,585 $121,703  $118,348
            
    Net interest income$43,205 $42,074 $168,675  $169,433
    Plus: tax-equivalent adjustment 389  368  1,460   1,244
    Plus: noninterest income 8,243  8,282  33,449   32,073
    Less: BOLI death benefit proceeds in excess of cash surrender value —  —  1,143   2,646
    Less: gain (loss) on sale of premises and equipment —  —  (9)   734
    Net interest income plus noninterest income – adjusted$51,837 $50,724 $202,450  $199,370


    Efficiency ratio66.10%  60.74%  61.68%  61.08% 
    Efficiency ratio – adjusted59.89%  60.30%  60.12%  59.36% 

    Set forth below is a reconciliation to GAAP of tangible book value and tangible book value per share:

     As of
    (Dollars in thousands, except per share data)December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023
    Total stockholders' equity$551,758 $540,004 $523,628 $513,173 $499,893
    Less: goodwill, core deposit intangibles, net of taxes 39,189  39,626  40,063  40,500  41,086
    Tangible book value$512,569 $500,378 $483,565 $472,673 $458,807
    Common shares outstanding 17,527,709  17,514,922  17,437,326  17,444,787  17,387,069
    Book value per share$31.48 $30.83 $30.03 $29.42 $28.75
    Tangible book value per share$29.24 $28.57 $27.73 $27.10 $26.39

    Set forth below is a reconciliation to GAAP of tangible equity to tangible assets:

     As of
    (Dollars in thousands)December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023
    Tangible equity(1)$512,569 $500,378 $483,565 $472,673 $458,807
    Total assets 4,595,430  4,637,293  4,670,864  4,684,011  4,672,633
    Less: goodwill, core deposit intangibles, net of taxes 39,189  39,626  40,063  40,500  41,086
    Total tangible assets$4,556,241 $4,597,667 $4,630,801 $4,643,511 $4,631,547


    Tangible equity to tangible assets11.25%  10.88%  10.44%  10.18%  9.91% 

    (1) Tangible equity (or tangible book value) is equal to total stockholders' equity less goodwill and core deposit intangibles, net of related deferred tax liabilities.


    Contact:
C. Hunter Westbrook – President and Chief Executive Officer
Tony J. VunCannon – Executive Vice President, Chief Financial Officer, Corporate Secretary and Treasurer
828-259-3939

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