Old National Bancorp (ONB) Q2 2024 earnings summary

Executive summary

• Second quarter 2024 adjusted EPS was $0.46, exceeding expectations, driven by revenue growth, lower expenses, and positive operating leverage.

• Net income applicable to common shares was $117.2 million ($0.37 per share); adjusted net income was $144.1 million.

• CapStar Bank acquisition closed April 1, expanding presence in Nashville and the Southeast, with all branches and systems integrated by July.

• Achieved strong organic growth, expanded into new markets, and maintained disciplined expense management.

• Fee revenue increased, especially in wealth management, treasury, and capital markets.

Financial highlights

• Net interest income (FTE) rose to $394.8 million, up 1.6% year-over-year; net interest margin (FTE) was 3.33%.

• Noninterest income was $87.3 million, up 12.6% sequentially, with $7 million from CapStar.

• Noninterest expense was $283.0 million, including $19.4 million in merger-related charges; adjusted noninterest expense was $263.6 million.

• Efficiency ratio was 57.2%; adjusted efficiency ratio was 52.6%.

• Total deposits reached $40.0 billion, up 10.4% year-over-year; loan-to-deposit ratio was 91%.

Outlook and guidance

• Management expects continued loan and deposit growth, with ongoing focus on expense discipline and credit quality.

• Net interest income expected to increase modestly in Q3 and Q4, assuming two 25bp rate cuts and a declining deposit beta.

• Full-year 2024 guidance: EOP loans up 5–7%, net interest income ~$1.56B, noninterest income ~$335M, noninterest expense $1.025B.

• Full-year charge-offs expected at 15–20 basis points, with provision for credit losses projected at $80–90M.

• Provision expense may remain volatile due to CECL model assumptions and macroeconomic factors.