- The company’s asset-liability management strategy includes maintaining a loan-to-deposit ratio of 76.5%, providing flexibility for growth.
- Funding costs are expected to stay low, with industry-level rates around 1.17%, supporting margin stability.
- Management highlighted the importance of matching treasury securities cash flows with future loan and debt maturities.
- The company is actively managing its interest rate risk to optimize net interest margin amid evolving market conditions.
- The strategic focus remains on balancing growth with risk management to sustain asset quality and profitability.
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- Allowance for credit losses totaled $142.2 million or 1.34% of total loans, with total loss absorption capacity of $250.6 million or 2.36% of loans.
- Asset quality remained sound with nonperforming loans declining to 0.61% of total loans and net charge-offs at $2.5 million (9 basis points annualized).
- Asset quality remained strong with nonperforming loans declining to 0.61% of total loans and net charge-offs at $2.5 million or 9 basis points annualized.
- Capital ratios remain strong with Tier 1 capital at 14.6% and tangible common equity to tangible assets at 9.75%.
- Capital ratios remain strong with Tier 1 capital ratio at 14.6% and tangible common equity to tangible assets at 9.75%, and tangible book value per share increased 12% year-over-year to $17.19.
- Loan growth was strong at an annualized 6.4%, with production of $854 million and a robust pipeline of $921 million.
- Net income increased 36% sequentially to $42.7 million or $0.50 per share, with adjusted net income up 39% to $44.5 million or $0.52 per share.
- Net interest income grew 7% to $126.9 million, driven by loan growth and lower deposit costs.
- Net interest income rose 7% to $126.9 million, driven by loan growth and lower deposit costs, with net interest margin expanding 10 basis points to 3.58%.
- Net interest margin expanded 10 basis points to 3.58%, or 5 basis points excluding accretion on acquired loans.
- Noninterest expense was $91.7 million, including $2.4 million in merger-related expenses, with an adjusted efficiency ratio improving to 55.4%.
- Noninterest expense was $91.7 million, including $2.4 million merger-related expenses, with adjusted efficiency ratio improving from 59.5% to 55.4%.
- Noninterest income increased 10% year-over-year to $24.5 million excluding securities activity, supported by treasury management, wealth, and insurance businesses.
- Noninterest income increased 10% year-over-year to $24.5 million, supported by treasury management, wealth, and insurance businesses.
- Return on assets improved to 1.08%, and return on tangible common equity rose to 12.8%.
- Return on assets improved to 1.08%, return on tangible common equity to 12.8%, and the adjusted efficiency ratio improved to 55%.
- Jay Sidhu announced transition to Executive Chairman effective January 1, 2026, with Sam Sidhu becoming CEO.
- Highlight of the company's growth from a $200 million asset bank in 2009 to a $22 billion national franchise.
- Emphasis on attracting top talent and building a high-performance, innovative management team.
- Net interest margin increased by 21 basis points to 3.83%, primarily due to improved loan yields and lower deposit costs.
- Most of the margin expansion was organic, with only a small contribution from the CenterBank acquisition and macro swap roll-offs.
- Macro swaps maturing in 2026 are expected to support margin stability, with a forecast of NIM staying above 4% in 2026 despite potential rate cuts.
- Cadence Bank completed the acquisition of Industry Bancshares on July 1, 2025, just 67 days after announcement, showcasing an unusually swift integration process.
- Immediately after closing, Cadence liquidated $1.9 billion of securities from Industry's sizable municipal portfolio, converting it into liquidity for reinvestment and risk management.
- The remaining securities from Industry's portfolio were reduced to under $600 million, with strategic reinvestment of $1 billion in securities yielding over 5.25% and $900 million used to lower wholesale funding.
- Cadence also implemented $550 million in interest rate swaps to hedge residual interest rate volatility, indicating a proactive approach to managing post-acquisition risks.
- The RBC ratio increased to 490%, reflecting a strong capital position, with management noting statutory restrictions limit the ability to deploy excess capital.
- The company is evaluating options for capital deployment, including buybacks and dividends, to optimize shareholder returns while maintaining a conservative risk profile.
- Management emphasized the importance of a strong RBC ratio for supporting growth and maintaining client and partner confidence, with ongoing assessments of long-term capital strategy.
- The reduction in criticized multifamily loans was due to upgrades and improved cash flows, despite a low base.
- The broader commercial real estate sector saw some increase in nonperforming assets, but overall levels remain manageable.
- Management reports that California multifamily markets continue to hold up well, with strong debt serviceability.
- The bank's multifamily portfolio is largely in California, with resilient cash flows and low loan-to-value ratios.
- Credit risk in the multifamily sector is well-managed, with ongoing monitoring and no significant deterioration observed.
- CET1 capital ratio was 10.7%, with adjusted CET1 including AOCI at 8.9%.
- Credit quality remained stable with nonperforming assets ratio at 0.44%, net charge-off ratio at 0.59%, and allowance for credit losses at 2.07% of loans.
- Generated 250 basis points of positive operating leverage year-over-year, marking the fourth consecutive quarter of revenue growth outpacing expense growth.
- Net interest margin declined 6 basis points sequentially, partly due to strategic loan sales and deposit pricing pressures.
- Reported Q2 2025 EPS of $1.11 on net income of $1.8 billion, with adjusted EPS growth of approximately 13% year-over-year.
- Return on tangible common equity was 18%, return on average assets was 1.08%, and efficiency ratio improved to the high-50s.
- Total average deposits decreased 0.7% linked quarter, average loans decreased 0.1% linked quarter due to loan sales, but C&I and credit card loans grew 7.1% and 4.4% year-over-year respectively.
- Total fee revenue grew 4.6% year-over-year, driven by diversified fee income businesses and organic growth.
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