• GAAP Net Income: $44.4 million for Q1 2025.
• Diluted Earnings Per Share (EPS): $1.04.
• Return on Assets (ROA): 0.93%.
• Return on Average Common Equity: 5.94%.
• Return on Average Tangible Common Equity: 8.85%.
• Adjusted Operating Net Income: $45.3 million, excluding $1.2 million of merger and acquisition expenses.
• Adjusted Diluted EPS: $1.06.
• Adjusted ROA: 0.94%.
• Adjusted Return on Average Common Equity: 6.05%.
• Adjusted Return on Average Tangible Common Equity: 9.01%.
• Tangible Book Value Per Share: Increased by $0.85 during the quarter.
• Deposit Growth: Period-end balances increased by $370 million or 2.4% for the quarter.
• Cost of Deposits: 1.56% for Q1 2025.
• Net Interest Margin (NIM): Improved 9 basis points to 3.42%.
• Core Net Interest Margin: 3.37%, up 6 basis points.
• Provision for Loan Loss: $15 million for Q1 2025.
• Allowance for Loan Losses: 99 basis points of total loans at quarter end.
• Noninterest Income: Increased modestly in Q1 2025.
• Investment Management Revenues: Increased 4% from Q4 2024 and nearly 13% from Q1 2024.
• Assets Under Administration (AUA): Grew nearly 1% to $7 billion in Q1 2025.
• Loan Portfolio: Total loans stayed relatively flat; C&I balances increased by 2%.
• Commercial Real Estate (CRE) and Construction Loans: Decreased by 1.2%.
• Subordinated Debt Raise: $300 million in March 2025.

Release Date: April 17, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Independent Bank Corp (NASDAQ:INDB) reported solid pre-provision net revenue growth driven by net interest margin improvement and well-controlled expenses.
• The company's tangible book value improved by 1.8% from the fourth quarter and 7.8% from the previous year.
• C&I and small business loans increased by 2.1% and 2.6% respectively, reflecting a strategic shift towards these areas.
• The Wealth Management business grew its assets under administration by nearly 1% in the first quarter, with positive returns despite market volatility.
• Independent Bank Corp (NASDAQ:INDB) was named a top place to work in Massachusetts for the 16th consecutive year and received high customer satisfaction rankings.

Negative Points

• Credit costs were elevated due to the resolution of several problem loans, impacting overall financial performance.
• The largest non-performing loan resolution was delayed to the second quarter, affecting credit quality metrics.
• Economic uncertainty due to tariffs and potential federal government actions has caused clients to pause expansion plans.
• The company experienced technical difficulties during the earnings call, which may have impacted the clarity of communication.
• Loan growth expectations were adjusted to low single-digit percentages due to a reduction in commercial real estate and mixed line utilization in C&I.

Q & A Highlights

Q: How many of the top five non-performing loans (NPLs) originated from East Boston? A: Two out of the five NPLs originated from East Boston, with the largest one being among them. Another one is from Blue Hills. - Mark Ruggiero, CFO

Q: Can you provide details on the $30.5 million loan that moved to nonaccrual status this quarter? A: The loan matured in the fourth quarter and reached 90 days past due in the first quarter, moving it to nonperforming status. It is a syndicated loan, and we are working on a potential modification. We charged off $8.1 million based on the appraisal value. - Mark Ruggiero, CFO

Q: Given the challenging economic climate, what gives you confidence in resolving the large NPLs quickly? A: We are far along in resolving the largest loan through a property sale, expected to close in the second quarter. We have done due diligence and are working through the closing process. - Jeffrey Tengel, CEO

Q: Do you still expect the net interest margin (NIM) for 2026 to be between 3.70% and 3.75% despite recent changes? A: Yes, we do. The fundamentals behind that guidance remain intact. The sub debt issuance has been factored into our standalone numbers, and we expect a higher purchase accounting number post-merger to provide a lift. - Mark Ruggiero, CFO

Q: How does the robust loan pipeline align with your reduced loan growth expectations? A: We expect continued runoff in commercial real estate, which will offset some growth in C&I loans. This mix results in a low single-digit loan growth forecast. - Jeffrey Tengel, CEO

Q: What are you seeing in terms of loan pricing and credit spreads? A: The market is competitive, and we are maintaining discipline in pricing. Current deals are priced in the mid-6% range, reflecting our strategy to not lead with price but to get paid for using the balance sheet. - Mark Ruggiero, CFO

Q: Can you provide an update on the leasing activity for Loan B? A: The property is around 80% occupied, with new tenants entering. However, free rent periods and tenant improvements are impacting cash flow. - Mark Ruggiero, CFO

Q: What are your priorities for capital deployment post-acquisition? A: Our priority is to support organic growth, but given the current environment, a buyback could be attractive. We are not predicting significant balance sheet growth in the near term. - Mark Ruggiero, CFO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.