Q4 2025 Bank of NT Butterfield & Son Ltd Earnings Call Transcript
Key Points
- Bank of N.T Butterfield & Son Ltd (NTB) reported a 17.4% year-on-year growth in core net income per share, reaching $5.60 per share.
- The company maintained a strong capital management strategy, reflected in a 97% total combined payout ratio for 2025, including increased quarterly dividends and share repurchases.
- Net interest margin improved by 5 basis points to 2.69% in 2025, with a decrease in the average cost of deposits.
- The bank's asset quality remains strong, with a low-risk density of 28.3% and a stable credit performance in loan and mortgage portfolios.
- Non-interest income increased due to higher banking fees, foreign exchange revenues, and asset management revenues, with a fee-income ratio of 41.7%.
- Net interest margin decreased by 4 basis points in the fourth quarter compared to the prior quarter, due to lower treasury and loan yields.
- Core non-interest expenses increased due to external services fees and high incentive accruals, with expectations of quarterly core expenses around $92 million.
- The bank experienced deposit outflows of $360 million, although these were partially offset by foreign exchange translation gains.
- Net unrealized losses in the available-for-sale portfolio were $89.4 million at the end of the fourth quarter, despite some improvement over the prior quarter.
- The bank's non-performing assets (NPAs) showed some movement, although not systemic, with concerns over potential credit migration.
Good day, and welcome to the Butterfield fourth-quarter 2025 earnings conference call. (Operator Instructions) Please note this event is being recorded.
I would now like to turn the conference over to Noah Fields. Please go ahead.
Thank you. Good morning, everyone, and thank you for joining us. Today, we will be reviewing Butterfield's fourth-quarter and full-year 2025 financial results.
On the call, I'm joined by Michael Collins, Butterfield's Chairman and Chief Executive Officer; Michael Schrum, President and Chief Financial Officer; and Bri Hidalgo, Chief Risk Officer. Following their prepared remarks, we will open the call up for a question-and-answer session.
Yesterday afternoon, we issued a press release announcing our fourth-quarter and full-year 2025 results. The press release and the slide presentation that we will refer to during our remarks on this call are available on the Investor Relations section of our website at
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