Old National Bancorp (ONB) Q3 2024 earnings summary

Executive summary

• Reported Q3 2024 net income applicable to common shares of $139.8M–$140M ($0.44/diluted share); adjusted net income of $147.2M ($0.46/share), driven by organic and CapStar-related growth, strong deposit inflows, and disciplined expense management.

• Tangible common book value per share increased 8% sequentially and 21% year-over-year, reflecting a focus on shareholder value.

• CapStar acquisition added $3.1B in assets, $2.1B in loans, and $2.6B in deposits, expanding presence in high-growth markets.

• Strategic priorities include funding loan growth with low-cost deposits, disciplined expense management, and continued investment in growth markets and talent.

• Positioned to invest in new markets and attract talent following successful execution of core strategies.

Financial highlights

• Net interest income (FTE) was $391.7M–$398M, up 1% sequentially and 4.4% year-over-year; net interest margin (FTE) was 3.32%, down 1 bp from 2Q24.

• Adjusted noninterest income reached $94M, up 8% sequentially and 16% year-over-year, led by wealth management, mortgage, and capital markets.

• Adjusted noninterest expense was $262.8M–$263M, flat sequentially and up 10% year-over-year; efficiency ratio improved to 53.8% (51.2% adjusted).

• Net charge-offs were 0.19% of average loans; allowance for credit losses at 1.05%–1.12% of total loans.

• Book value per share was $19.20; tangible book value per share was $11.97 at quarter-end.

Outlook and guidance

• Net interest income is expected to grow modestly in Q4 2024, with full-year loan growth and NII in line with original expectations; 4Q24 NII expected at ~$400M.

• Full-year 2024 outlook: loans up 5–7% (excluding CapStar), net interest income ~$1,555M, noninterest income ~$345M, noninterest expense ~$1,030M.

• Net charge-off ratio projected at 0.17–0.20% for the year; provision for credit losses of $95–$100M.

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

• Deposit beta is expected to be around 30% by year-end, with agility to respond to Fed actions.