On July 24, 2024, First Internet Bancorp (INBK, Financial) released its 8-K filing detailing the financial results for the second quarter ended June 30, 2024. First Internet Bancorp is a bank holding company that provides commercial real estate (CRE) lending, commercial and industrial (C&I) lending, and retail banking services through its internet-based platform.
Performance Overview
First Internet Bancorp reported net income of $5.8 million for Q2 2024, an 11.5% increase from the previous quarter. Adjusted net income was $6.2 million, up 20.2% sequentially. The company posted diluted earnings per share (EPS) of $0.67, missing the analyst estimate of $0.71. However, adjusted diluted EPS was $0.72, surpassing expectations.
Revenue and Net Interest Income
First Internet Bancorp's total revenue for Q2 2024 was $32.3 million, exceeding the analyst estimate of $22.87 million. Net interest income increased to $21.3 million, a 2.9% rise from Q1 2024. On a fully-taxable equivalent basis, net interest income was $22.5 million. The net interest margin (NIM) improved slightly to 1.67%, up from 1.66% in the previous quarter.
Noninterest Income and Expense
Noninterest income surged by 32.2% to $11.0 million, driven by gains on loan sales and other income sources. Noninterest expense rose to $22.3 million, a 6.2% increase from Q1 2024. Excluding non-recurring costs, adjusted noninterest expense was $21.8 million, up 3.5% sequentially.
Loan Growth and Credit Quality
Loan growth was robust, with total loans increasing by $51.3 million, or 1.3%, from Q1 2024. The allowance for credit losses to total loans ratio was 1.10%, up from 1.05% in the previous quarter. Nonperforming loans remained stable at 0.33% of total loans.
Capital and Shareholder Equity
Total shareholders' equity stood at $372.0 million, a 1.4% increase from Q1 2024. The tangible book value per share was $42.37, up 1.3% sequentially. The company's capital ratios remained strong, with a Tier 1 leverage ratio of 7.24% and a total risk-based capital ratio of 13.13%.
Commentary and Outlook
"Our strong upward earnings trajectory continued in the second quarter of 2024, driven by an increasingly diversified revenue base," said David Becker, Chairman and Chief Executive Officer. "The optimization of our loan portfolio, solid loan growth, increasing asset yields, and stabilization of funding costs have led to improved net interest income."
First Internet Bancorp's performance in Q2 2024 highlights its ability to grow revenue and manage expenses effectively. However, the slight miss on EPS indicates potential challenges in maintaining profitability amid rising costs. The company's focus on diversifying its revenue streams and optimizing its loan portfolio positions it well for future growth.
For more detailed financial information, please refer to the 8-K filing.
Explore the complete 8-K earnings release (here) from First Internet Bancorp for further details.
