Horizon Bancorp (IN) (HBNC) Reports Q4 and Full Year 2023 Results Amidst Strategic Balance ...
Net Loss: Reported a net loss of $25.2 million, or $0.58 per diluted share for Q4, primarily due to balance sheet restructuring.
Adjusted Net Income: Excluding one-time items, adjusted net income was $14.1 million, or $0.33 per diluted share.
Loan Growth: Commercial loan growth surged by 13.1% annualized during the quarter, with total loans reaching $4.42 billion.
Net Interest Margin: Increased slightly to 2.43% from 2.41% in the previous quarter.
Deposits: Remained stable at $5.7 billion, demonstrating resilience in core deposit balances.
Asset Quality: Maintained excellent asset quality with net charge-offs at 0.02% of average loans for the quarter.
Capital Ratios: Continued to exceed regulatory capital ratios for "well capitalized" banks as of December 31, 2023.
On January 24, 2024, Horizon Bancorp (IN) (NASDAQ:HBNC) released its 8-K filing, detailing the financial results for the fourth quarter and the full year of 2023. The company, a prominent banking services provider in the United States, faced a challenging quarter with a reported net loss. However, underlying financials suggest a resilient core business, with strategic moves poised to enhance future earnings growth.
Financial Performance and Strategic Moves
Horizon Bancorp (IN) (NASDAQ:HBNC) reported a net loss for the fourth quarter of 2023, amounting to $25.2 million, or $0.58 per diluted share. This loss was primarily due to a balance sheet repositioning that included the sale of $382.7 million in lower-yielding securities and the surrender of $112.8 million of bank-owned life insurance policies. Excluding the after-tax impact of the balance sheet repositioning and certain extraordinary expenses, the adjusted net income for the quarter was $14.1 million, or $0.33 per diluted share.
Despite the net loss, Horizon Bancorp (IN) (NASDAQ:HBNC) experienced robust commercial loan growth, with an annualized increase of 13.1% during the quarter. The company's total loans were $4.42 billion at the period's end, marking a 5.2% annualized increase during the quarter. The net interest margin also saw a slight uptick to 2.43%, compared to 2.41% in the linked quarter.
Asset Quality and Capital Strength
Horizon Bancorp (IN) (NASDAQ:HBNC) maintained excellent asset quality, with net charge-offs representing a mere 0.02% of average loans for the quarter. The company's non-performing loans stood at 0.44% of total loans at the period's end. The capital resources of the company and the bank continued to exceed the regulatory capital ratios for "well capitalized" banks, with stockholders' equity totaling $718.8 million at the end of December 2023.
Looking Ahead
President and CEO Thomas M. Prame expressed optimism about the company's positioning for 2024, citing positive momentum in core business models and the potential for value creation for shareholders and clients. The balance sheet restructuring is expected to provide liquidity to deploy into higher-yielding assets, driving meaningful earnings growth in future quarters.
Horizon had a very positive and productive fourth quarter, led by strong loan growth, consistent core deposit balances, stabilized net interest margin and excellent asset quality," said Thomas M. Prame, President and CEO. "We are very optimistic about our position as we enter 2024 and our ability to create value for our shareholders and clients."
Horizon Bancorp (IN) (NASDAQ:HBNC) continues to focus on maintaining a stable base of core deposits and leveraging its relationship banking model to sustain its financial health. With strategic initiatives in place, the company is poised to navigate the complexities of the current economic landscape while seeking growth opportunities.
For a detailed analysis of Horizon Bancorp (IN) (NASDAQ:HBNC)'s financial results and strategic initiatives, investors and interested parties are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from Horizon Bancorp (IN) for further details.
This article first appeared on GuruFocus.
