Executive Summary

Q4 2024 GAAP EPS was $0.81 and adjusted EPS was $0.85; total revenue rebounded to $130.4MM as the prior quarter’s securities restructuring loss rolled off, while core efficiency improved to 54.6% .
Net interest income rose to $108.4MM; NIM slipped 5 bps to 3.50% as FBK held more cash to pre‑fund 2025 loan growth, but cost of total deposits fell 13 bps to 2.70% as indexed and repriced deposits moved lower .
Credit absorbed a single, previously reserved C&I charge-off; annualized NCOs were 0.47% with ACL at 1.58% of loans, NPLs/Loans improved to 0.87%, and capital remained strong (CET1 12.8%, TCE/TA 10.2%) .
2025 setup: management guided Q1 2025 NIM to 3.54–3.61% and banking noninterest expense to $64–$66MM; full-year bank expense growth outlook is ~4–5% and targeted loan growth is high single‑digit to low double‑digit, skewing to C&I .
Subsequent development: FBK raised its quarterly dividend by 12% to $0.19 per share on Jan 29, 2025, underscoring capital strength and earnings durability (potential stock catalyst) .

What Went Well and What Went Wrong

What Went Well
- Organic growth and funding momentum: core deposits grew 10.8% annualized and loans 5.22% annualized; net interest income increased to $109.0MM (TE) with securities yields +19 bps QoQ from Q3’s repositioning .
- Operating leverage improved: core efficiency ratio fell to 54.6% (Banking segment 50.2%) on stronger revenue and disciplined expenses; CFO: “Improvement in operating efficiency was a highlight this quarter” .
- Capital/liquidity strength sustained: CET1 12.8%, TCE/TA 10.2%, on‑balance sheet liquidity $1.64B (12.5% of assets) and diversified borrowing capacity .
- Management tone: “operating momentum position us well moving into 2025” and “we will continue to build the Company by adding and expanding on core banking relationships” .
What Went Wrong
- Margin mixed: NIM dipped 5 bps to 3.50% due to elevated interest‑earning cash while pre‑funding growth; loan contractual yield fell 22 bps sequentially with lower benchmarks .
- Noninterest‑bearing deposits declined seasonally; mix shift kept deposit beta management in focus despite headline cost of deposits falling to 2.70% .
- Mortgage banking softened sequentially (to $10.6MM from $11.6MM) amid typical Q4 seasonality, even as the business stayed profitable .
- Credit headline from a single C&I charge‑off lifted NCOs to 0.47% annualized (management emphasized it was previously reserved and idiosyncratic) .

Financial Results

Metric	Q2 2024	Q3 2024	Q4 2024
Total revenue ($MM)	$128.2	$89.5	$130.4
Net interest income ($MM)	$102.6	$106.0	$108.4
Noninterest income ($MM)	$25.6	$(16.5)	$22.0
Noninterest expense ($MM)	$75.1	$76.2	$73.2
Diluted EPS (GAAP)	$0.85	$0.22	$0.81
Adj. Diluted EPS (Non‑GAAP)	$0.84	$0.86	$0.85

Margin/Return	Q2 2024	Q3 2024	Q4 2024
Net interest margin (TE)	3.57%	3.55%	3.50%
Efficiency ratio	58.6%	85.1%	56.1%
Core efficiency ratio (TE)	58.3%	58.4%	54.6%
ROAA (GAAP)	1.30%	0.32%	1.14%
ROATCE (GAAP)	13.1%	3.19%	11.5%

Segment pre‑tax contribution (after allocations)

Segment ($MM)	Q2 2024	Q3 2024	Q4 2024
Banking	$49.9	$10.8	$49.9
Mortgage	$1.0	$0.6	$0.3

Key KPIs and risk/capital

KPI	Q2 2024	Q3 2024	Q4 2024
Loans HFI ($B)	$9.31	$9.48	$9.60
Total deposits ($B)	$10.47	$10.98	$11.21
Loans/Deposits (%)	88.9%	86.4%	85.7%
Cost of total deposits (%)	2.77%	2.83%	2.70%
NPLs/Loans (%)	0.79%	0.96%	0.87%
NPAs/Assets (%)	0.81%	0.99%	0.93%
ACL/Loans (%)	1.67%	1.65%	1.58%
Net charge‑offs (ann.)	0.02%	0.03%	0.47%
CET1 (%)	12.7%	12.7%	12.8%
TCE/TA (%)	10.2%	10.4%	10.2%

Note: Adj. metrics are non‑GAAP; see company’s reconciliation for details .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net interest margin (TE)	Q4 2024 → actual vs prior guide	3.50%–3.60% for Q4 2024 (Q3 call)	Actual 3.50% (Q4)	In‑line
Net interest margin (TE)	Q1 2025	—	3.54%–3.61%	New
Banking noninterest expense	Q4 2024	$63–$65MM (Q3 call)	Actual Bank core ~$60.7MM; Consolidated $73.2MM	Better than guide (Bank core)
Banking noninterest expense	Q1 2025	—	$64–$66MM	New
Banking noninterest expense growth	FY 2025	—	~4–5% YoY	New
Loan growth outlook	FY 2025	“Low double‑digit” goal (Q3)	“High single‑digit to low double‑digit” target; tilt to C&I	Maintained/slightly refined
Dividend	Post‑Q4	—	Raised to $0.19 (+12%)	New/increased

Earnings Call Themes & Trends

Topic	Q2 2024 (prior)	Q3 2024 (prior)	Q4 2024 (current)	Trend
Loan growth outlook	Muted 2H24; positioning for ~10% in 2025; hiring producers	Optimism building; hiring continues	Target HSD–LDD growth; basket skew to C&I; CRE selective	Improving growth cadence
Margin/sensitivity	FY24 NIM 3.47–3.53; more neutral sensitivity	Q4 NIM guide 3.50–3.60	Q1’25 NIM 3.54–3.61; slight asset sensitivity	Stable/modest expansion path
Deposit competition/costs	Competitive, managing term; wholesale optionality	Brokered used tactically; cost uptick	Cost of deposits down to 2.70%; still competitive to win new money	Mix benefit; competition persists
CRE/Office and credit	Watching C&I more than CRE for loss content	NPLs rose on a few credits; minimal expected loss content	Nashville office headlines seen as idiosyncratic; portfolio small (≈4% office) and granular	Monitored; contained
M&A appetite	Target $1–5B banks in adjacent markets	Continued interest	Warmer regulatory tone; potentially more constructive timing	Optionality rising
Mortgage	Profitable, smoothing cyclicality	Positive contribution	Positive but seasonally softer; efficiency to improve in 2025	Steady, margin‑managed

Management Commentary

CEO: “The Company continued producing both deposit and loan growth during the quarter, resulting in increased net interest income… Our strong financial position and operating momentum position us well moving into 2025” .
CEO on strategy: “First priority has been and always will be organic growth… expanding into Asheville, North Carolina… ready and eager to bring our expertise and capital resources to this market as it rebuilds” .
CFO on margin: “NIM was down a couple of basis points to 3.5%… impacted by a 4 bps drag due to carrying excess interest‑bearing cash… cost of interest‑bearing deposits decreased 21 bps to 3.37%… cost of total deposits to 2.7%” .
CFO on expenses: “Core noninterest expense decreased to $72.7MM… Banking segment core efficiency ratio of 50.2%… 2025 banking expenses to grow ~4%–5%; Q1’25 bank expense $64–$66MM” .
CFO on credit: “Elevated charge‑off… full charge‑off of a single previously reserved C&I relationship… absent this, Q4 annualized NCO rate was ~3 bps” .

Q&A Highlights

Hiring pipeline: Adding core C&I relationship managers across geographies; recruiting remains opportunistic and ongoing .
Loan growth drivers: Expect HSD–LDD growth in 2025 from both existing RMs and newer hires; deposit growth pre‑funded to support deployment .
Margin levers: Improving loan‑to‑deposit ratio and potential runoff of higher‑cost deposits; slight asset sensitivity, prefer stability in rates .
Deposit costs: Competitive across markets; new money typically priced at 80–90% of Fed funds; CDs >4.5% present in some markets .
Nashville office/CRE: Recent distressed sales seen as idiosyncratic, older assets, non‑local financed; FBK office book is small, diversified, largely pass‑rated/current .

Estimates Context

S&P Global consensus for Q4 2024 (EPS and revenue) was unavailable via our data service at the time of analysis; therefore, we cannot quantify a beat/miss versus Street. Models should reflect: Q4 adjusted EPS of $0.85, total revenue of $130.4MM, NIM of 3.50%, and core efficiency ratio of 54.6% .
For forward estimates, incorporate management’s Q1 2025 NIM guide (3.54%–3.61%) and banking noninterest expense range ($64–$66MM), plus full‑year bank expense growth of ~4–5% and targeted HSD–LDD loan growth, with a tilt to C&I .

Key Takeaways for Investors

Revenue and net interest income momentum resumed in Q4 as the Q3 securities loss washed out; core profitability and efficiency improved materially QoQ (core efficiency 54.6%) .
Deposit beta tailwinds emerged (cost of deposits down to 2.70%), while management pre‑funded balance sheet growth; NIM guidance implies modest expansion in Q1 2025 .
Credit remains manageable with idiosyncratic C&I loss absorbed; reserve coverage at 1.58% of loans and NPLs/Loans ticked down to 0.87% .
Strong capital and liquidity (CET1 12.8%, TCE/TA 10.2%; on‑balance sheet liquidity 12.5% of assets) support organic growth and optionality for M&A/shareholder returns .
Strategic hiring and selective market expansion (e.g., Asheville) should support HSD–LDD loan growth in 2025, with disciplined CRE exposure and focus on core C&I relationships .
Dividend increased 12% post‑quarter, reinforcing capital return capacity alongside growth investments .

SUPPORTING APPENDIX (selected data)

Q4 highlights: Total revenue $130.4MM; NII $108.4MM; Noninterest income $22.0MM; Noninterest expense $73.2MM; GAAP EPS $0.81; Adj EPS $0.85 .
Balance sheet: Loans HFI $9.60B; Deposits $11.21B; Loans/Deposits 85.7%; Cost of total deposits 2.70% .
Risk/capital: ACL/Loans 1.58%; NPLs/Loans 0.87%; NPAs/Assets 0.93%; CET1 12.8%; TCE/TA 10.2% .

Non‑GAAP note: Adjusted metrics referenced above are non‑GAAP and reconciled in FBK’s Q4 2024 Financial Supplement .

FB Financial Corp (FBK)·Q4 2024 Earnings Summary