Annualized return on average assets was 113 basis points, up 3 basis points from the first quarter, with an efficiency ratio just below 60%.
Commercial loans totaled $2.94 billion, flat with March 31, 2025, and up 5% year-over-year, with commercial business loans up 2.4% during the quarter.
Consumer indirect balances declined 2.3% from March 31 and 7% year-over-year to $833.5 million, with improved credit metrics including a net charge-off ratio of 45 basis points, down from 103 basis points in Q1.
Net interest margin expanded by 14 basis points from the linked quarter and 62 basis points year-over-year, with net interest income growth of approximately 5% linked quarter and 19% year-over-year.
Noninterest expense was $35.7 million in Q2, up from $33.7 million in Q1, driven by timing, higher medical claims, staffing additions, and technology-related expenses.
Noninterest income was $10.6 million, up 2.4% from the first quarter, excluding a $13.5 million gain from the prior year insurance business sale.
Nonperforming commercial loans declined by $7 million from March 31 to June 30, 2025, with $2.5 million in commercial net charge-offs related to two longstanding nonperforming relationships.
Provision for credit losses was $2.6 million in Q2, down from $2.9 million in Q1, with a loan loss reserve coverage ratio of 104 basis points at June 30, 2025.
Second quarter 2025 net income available to common shareholders increased 4% to $17.2 million, with diluted EPS up 5% compared to the linked quarter.
Total deposits were down about 4% from March 31, 2025, due to seasonality and Banking-as-a-Service deposit outflows, with average deposits relatively flat year-over-year.
Total loans at period end were $4.54 billion, consistent with March 31, 2025, with average loans up 1% from the first quarter and 2% year-over-year.
Adjusted earnings per share were $0.42 compared to $0.44 a year ago, impacted by lower Iraq revenues and higher interest expense.
Adjusted operating margin remained stable at 19% year-over-year despite higher consumer fraud losses and lower Iraq contributions.
Branded digital business increased transactions by 9% and adjusted revenue by 6%.
Cash flow from operations was $148 million year-to-date, up from $60 million prior year, with capital expenditures down 15%.
Consumer money transfer transactions declined 3% in the quarter, while cross-border principal grew mid-single digits on a constant currency ex Iraq basis.
Consumer Services adjusted revenue grew 40% driven by Eurochange acquisition and strong European travel.
Returned over $150 million to shareholders in Q2 and over $300 million in the first half of 2025, representing over 10% cash return versus market cap.
Western Union reported second quarter 2025 adjusted revenue of $1.026 billion, down 1% year-over-year excluding Iraq impacts.
Bank OZK reported strong loan growth with an 11% to 13% annual growth guidance, exceeding prior high single-digit expectations.
CIB (Corporate and Institutional Banking) was the largest contributor to loan growth, with $900 million growth in the recent quarter and an accelerating trend expected.
Deposit costs were stable around 3.68% to 3.7%, with deposit growth supported by branch expansion and CIB relationship growth.
The allowance for credit losses (ACL) increased by $366 million over 12 quarters, reflecting a cautious economic outlook, but net charge-offs remain low at about one-third of the industry average.
The RESG (Real Estate Specialties Group) portfolio saw higher paydowns, with $0.54 billion in paydowns in the first half of the quarter, impacting loan growth but still hitting highest funded balances ever.
Dafinchi