On July 24, 2024, Origin Bancorp Inc (OBK, Financial) released its 8-K filing for the second quarter of 2024. The financial holding company reported net income of $21.0 million, or $0.67 diluted earnings per share, surpassing the analyst estimate of $0.62 per share. The company also reported revenue of $96.4 million, exceeding the estimated $91.08 million.
Company Overview
Origin Bancorp Inc is a financial holding company that provides a broad range of financial services to businesses, municipalities, high-net-worth individuals, and retail clients. The bank principally operates in one business segment, community banking, and generates the majority of its revenue from interest earned on loans and investments, service charges, and fees on deposit accounts.
Performance and Challenges
For the quarter ended June 30, 2024, Origin Bancorp Inc reported net income of $21.0 million, or $0.67 diluted earnings per share, compared to $22.6 million, or $0.73 diluted earnings per share, for the previous quarter. Pre-tax, pre-provision (PTPP) earnings were $32.0 million, slightly up from $31.9 million in the previous quarter.
Despite the positive earnings, the company faced challenges, including a questioned activity involving a single banker in East Texas, which led to a reversal of $1.2 million of accrued interest and impacted the net interest margin (NIM). The NIM-FTE was 3.17% for the quarter, a slight decrease from the previous quarter.
Financial Achievements
Origin Bancorp Inc achieved several financial milestones during the quarter:
- Total loans held for investment (LHFI) increased by $59.1 million to $7.96 billion.
- Total deposits rose by $5.4 million to $8.51 billion.
- Noninterest income reached $22.5 million, the highest level since the company went public in 2018.
- Book value per common share increased to $35.23, and tangible book value per common share rose to $29.77.
- Stockholders’ equity grew by $17.0 million to $1.10 billion.
Key Financial Metrics
Important metrics from the earnings report include:
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Net Interest Income | $73.9 million | $73.3 million | $75.3 million |
| Noninterest Income | $22.5 million | $17.3 million | $15.6 million |
| Noninterest Expense | $64.4 million | $58.7 million | $58.9 million |
| Net Income | $21.0 million | $22.6 million | $21.8 million |
| Basic Earnings Per Share | $0.67 | $0.73 | $0.71 |
Analysis
Origin Bancorp Inc's performance in Q2 2024 demonstrates resilience and growth despite facing internal challenges. The increase in loans and deposits, along with record noninterest income, highlights the company's strong market position. However, the questioned activity in East Texas and the resulting impact on net interest margin indicate areas that require close monitoring.
Overall, Origin Bancorp Inc's ability to exceed analyst estimates and achieve significant financial milestones positions it well for future growth, making it an attractive consideration for value investors.
Explore the complete 8-K earnings release (here) from Origin Bancorp Inc for further details.
