On July 24, 2024, Horizon Bancorp (IN) (HBNC, Financial) released its 8-K filing detailing the financial results for the second quarter of 2024. Horizon Bancorp (IN) is a United States-based holding company providing commercial and retail banking services, corporate and individual trust and agency services, and other services incident to banking. The company also provides commercial loans, real estate loans, mortgage warehouse loans, consumer loans, and other credit facilities.
Performance Overview
Horizon Bancorp (IN) reported a net income of $14.1 million, or $0.32 per diluted share, for the second quarter of 2024. This performance aligns with the first quarter of 2024 but shows a decline from the $18.8 million, or $0.43 per diluted share, reported in the second quarter of 2023. For the six months ended June 30, 2024, net income was $28.1 million, or $0.64 per diluted share, compared to $37.0 million, or $0.85 per diluted share, for the same period in 2023.
Key Financial Achievements
Net interest income increased for the third consecutive quarter to $45.3 million, compared to $43.3 million in the linked quarter of 2024. The net interest margin, on a fully taxable equivalent (FTE) basis, expanded to 2.64%, up from 2.50% in the previous quarter. This growth was driven by a favorable mix shift in average interest-earning assets toward higher-yielding loans against relatively stable costs of interest-bearing liabilities.
Income Statement Highlights
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Net Interest Income | $45.3 million | $43.3 million | $46.2 million |
| Provision for Credit Losses | $2.4 million | $0.8 million | $0.7 million |
| Non-Interest Income | $10.5 million | $9.9 million | $11.0 million |
| Non-Interest Expense | $37.5 million | $37.1 million | $36.3 million |
| Net Income | $14.1 million | $14.0 million | $18.8 million |
Balance Sheet and Credit Quality
Total assets increased by $56.8 million, or 0.7%, to $7.91 billion as of June 30, 2024. Total loans held for investment (HFI) were $4.8 billion, reflecting a 4.4% increase during the quarter, driven by organic commercial loan growth of $154.8 million. Deposits totaled $5.6 billion at period end, increasing by 0.9% during the quarter.
Credit quality remained strong, with non-accrual loans declining by $0.8 million to $18.3 million. The allowance for credit losses as a percentage of period-end loans HFI was 1.08% at June 30, 2024, compared to 1.09% at March 31, 2024.
Commentary
"We are proud of the Company's performance during the second quarter, which was highlighted by sequential growth in revenue and pre-tax pre-provision income resulting from the strategic shift of Horizon’s balance sheet toward a more profitable earning asset mix, and diligent expense management," said President and Chief Executive Officer Thomas M. Prame.
Analysis
Horizon Bancorp (IN) (HBNC, Financial) has demonstrated resilience and strategic growth in its second quarter of 2024, despite a year-over-year decline in net income. The consistent increase in net interest income and net interest margin expansion are positive indicators of the company's ability to manage its asset mix effectively. The growth in commercial loans and stable deposit base further underscore the company's strong market position.
However, the increased provision for credit losses and the decline in net income compared to the previous year highlight ongoing challenges. The company's ability to maintain credit quality and manage non-interest expenses will be crucial in sustaining its financial performance.
For more detailed insights and the complete financial statements, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Horizon Bancorp (IN) for further details.
