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GLACIER BANCORP, INC. (GBCI)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered strong core operating momentum: net interest income rose 9% q/q to $208M and NIM expanded 17 bps to 3.21% on higher loan yields and lower funding costs, even as GAAP diluted EPS of $0.45 reflected $19.9M acquisition-related and credit loss expenses tied to Bank of Idaho (BOID) .
  • Management raised margin trajectory guidance, targeting 15–17 bps sequential NIM expansion in Q3 and Q4, with the pending Guaranty Bancshares deal potentially adding an incremental 6–7 bps post-close; core noninterest expense guides were reset to $159–$161M (Q3) and $161–$163M (Q4) .
  • Against S&P Global consensus, Q2 EPS beat and revenue missed: Primary EPS actual was above estimates while revenue came in below; differences versus company “total income” reflect SPGI’s revenue definition and GAAP vs normalized EPS treatment (see Estimates Context) [Values retrieved from S&P Global]*.
  • Strategic catalysts: completion of BOID ($1.4B assets) and announced entry into Texas via Guaranty ($3.1B assets) strengthen footprint; continued deleveraging of FHLB advances supports NIM expansion and capital flexibility .

What Went Well and What Went Wrong

What Went Well

  • Net interest income grew to $207.6M (+$17.6M q/q, +$41.1M y/y) on higher loan yields and average balances; NIM expanded to 3.21% (core 3.18%) with total cost of funding down to 1.63% .
  • Deposit growth and mix improved: total deposits rose 5% q/q to $21.63B; noninterest-bearing deposits increased 8% q/q to $6.59B and remained 30% of deposits, supporting funding costs .
  • Management tone confident: “We delivered an excellent quarter…higher loan yields, lower deposit cost, increasing margin, solid growth, and disciplined expense management” (CEO) .

What Went Wrong

  • GAAP diluted EPS of $0.45 decreased 6% q/q due to $19.9M acquisition-related and credit loss expenses from BOID (including $16.7M credit loss expense); tax rate rose to 19.0% (vs 14.0% in Q1), lifting tax expense $3.5M q/q .
  • Credit quality mixed: non-performing assets increased to 0.17% of assets ($48.6M), up 24% q/q and 170% y/y, driven primarily by specific credits and acquisition impacts; early-stage delinquencies edged up q/q to 0.28% of loans .
  • Acquisition-related costs increased other expense ($3.2M current quarter vs $0.6M in Q1), and noninterest expense rose 3% q/q to $155.1M .

Financial Results

Headline Metrics vs Prior Periods

MetricQ2 2024Q1 2025Q2 2025
Diluted EPS ($)0.39 0.48 0.45
Net Income ($M)44.7 54.6 52.8
Total Income ($M)198.7 222.6 240.6
Net Interest Income ($M)166.5 190.0 207.6
Net Interest Margin (tax-eq, %)2.68 3.04 3.21
Efficiency Ratio (%)67.97 65.49 62.08

Interest Income/Expense Detail

Metric ($M unless noted)Q2 2024Q1 2025Q2 2025
Investment Securities Interest Income42.2 45.6 44.1
Residential Real Estate Interest Income21.8 24.3 25.4
Commercial Loans Interest Income188.3 197.4 214.8
Consumer & Other Loans Interest Income21.6 22.6 23.8
Total Interest Income273.8 289.9 308.1
Deposits Interest Expense67.9 62.9 65.6
Repurchase Agreements Expense13.6 13.7 14.1
FHLB Advances Expense24.2 20.7 17.8
Subordinated Debentures Expense1.4 2.2 2.6
Total Interest Expense107.4 99.9 100.5

KPIs and Balance Sheet

KPIQ2 2024Q1 2025Q2 2025
Loan Yield (%)5.58 5.77 5.86
Total Earning Asset Yield (%)4.37 4.61 4.73
Total Cost of Funding (%)1.80 1.68 1.63
Core Deposit Cost (%)1.36 1.25 1.25
Loans Receivable ($B)16.85 17.22 18.53
Total Deposits ($B)20.10 20.63 21.63
Noninterest-Bearing Deposits ($B)6.09 6.10 6.59
Deposits + Repurchase Agreements ($B)21.73 22.48 23.60
FHLB Advances ($B)2.35 1.52 1.26
Loan-to-Deposit Ratio (%)84.03 83.64 85.91
Tangible Book Value/Share ($)18.26 19.28 19.79
Equity/Assets (%)11.28 11.80 12.19

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChangeSource
Core Noninterest Expense ($M)Q3 2025160–162159–161Lowered
Core Noninterest Expense ($M)Q4 2025160–162161–163Raised
Net Interest Margin (bps q/q)Q3–Q4 2025Prior guide lower15–17 bps per quarterRaised
NIM Add from Guaranty (bps)Post-close (expected Q4 2025)n/a+6–7 bpsNew
FHLB Advances Paydown ($M)Q3 2025n/a>300New
FHLB Advances Paydown ($M)Q4 2025n/a400–440New
Deposit Cost Outlook (%)2H25Stable~1.25% (down only with Fed cuts)Maintained
Dividend per Share ($)Q3 2025n/a0.33Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024)Previous Mentions (Q1 2025)Current Period (Q2 2025)Trend
Net Interest MarginNIM 2.97%; improving trajectory NIM 3.04%; 5th consecutive increase NIM 3.21%; guide +15–17 bps per quarter Accelerating improvement
Deposit CostsCore deposit cost 1.29% 1.25%; declining ~1.25%; stable unless Fed cuts Stable to down
Borrowings DeleveragingFHLB $1.80B $1.52B $1.26B; paydowns >$300M (Q3), $400–$440M (Q4) Declining borrowings
Credit QualityNPA 0.10% NPA 0.14% NPA 0.17%; early DQs ~0.28% Modest deterioration, still low
Technology InitiativesLimited disclosuren/aCommercial loan platform and treasury platform upgrades to improve efficiency and CX Increasing investment
M&A/FootprintRMB integration ongoingBOID signed (close 4/30) BOID completed; Guaranty announced (Texas entry) Active consolidation/expansion

Management Commentary

  • “We delivered an excellent quarter, continuing our momentum with higher loan yields, lower deposit cost, increasing margin, solid growth, and disciplined expense management” — Randy Chesler, CEO .
  • “Growth in the loan portfolio at higher yields, along with stable deposit costs and the reduction in higher cost FHLB borrowings contributed to the 17 basis points increase in the current quarter net interest margin” — Ron Copher, CFO .
  • “We think we can continue this pace of increase…maybe 15–17 bps per quarter…Guaranty could add an additional 6–7 bps” — Byron Pollan, Treasurer .
  • “For the third quarter, we’re reducing core noninterest expense guide to $159–$161M; for the fourth quarter, $161–$163M” — Ron Copher, CFO .
  • “We were at 7.35% average production yield for the quarter” — Tom Dolan, Chief Credit Officer .

Q&A Highlights

  • Margin trajectory: Management guided sequential NIM expansion of 15–17 bps in Q3/Q4, aided by deleveraging and higher loan yields; Guaranty adds 6–7 bps upon close .
  • Expense path: Core noninterest expense guide reduced for Q3 (to 159–161M), modest increase for Q4 (161–163M), with hiring resuming and deferred consulting spend normalizing .
  • Deposit costs and funding: Deposit costs expected to be broadly stable (~1.25%) absent further Fed cuts; cost of funds to continue declining as FHLB advances mature and are repaid .
  • Organic loan growth: Pipelines healthy; seasonal tailwinds in construction and agriculture; production yields robust at 7.35%; payoff pressure expected to abate later in the year .
  • Balance sheet deleveraging: Maturities ladder implies >$300M FHLB reductions in Q3 and $400–$440M in Q4, embedded in margin outlook .

Estimates Context

MetricQ4 2024 Consensus*Q4 2024 Actual*Q1 2025 Consensus*Q1 2025 Actual*Q2 2025 Consensus*Q2 2025 Actual*
Primary EPS ($)0.5180.5500.4640.4840.4850.589
EPS — # of Estimates6—5—6—
Revenue ($M)225.0214.3227.1212.7242.7221.6
Revenue — # of Estimates5—5—4—

Values retrieved from S&P Global*.

  • Q2 2025 summary vs consensus: EPS beat (Primary EPS $0.589 vs $0.485) and revenue miss ($221.6M vs $242.7M). Note company-reported GAAP diluted EPS was $0.45 due to $19.9M acquisition-related and credit loss expenses; SPGI “Primary EPS” reflects normalized treatment, explaining the variance .

Key Takeaways for Investors

  • Core NIM expansion is the central near-term driver; management’s raised guide (15–17 bps q/q) plus projected FHLB paydowns and Guaranty’s 6–7 bps uplift create a credible path to continued margin gains through year-end — a positive estimate revision catalyst .
  • Strong deposit mix (30% noninterest-bearing) and 5% q/q deposit growth underpin funding cost stability, improving spread dynamics even without further Fed cuts .
  • Acquisition integration (BOID) and Texas entry via Guaranty broaden the footprint and scale; near-term costs impacted GAAP EPS, but strategic positioning and NIM accretion support medium-term ROE improvement .
  • Watch credit metrics: NPA ratio rose to 0.17% and early delinquencies ticked up; levels remain low, but continued monitoring is warranted as growth accelerates and markets evolve .
  • Expense discipline remains intact; Q3 guide cut and modest Q4 increase suggest operating leverage persists as margin rises, though some deferred consulting and hiring will normalize spend .
  • Trading setup: Near-term stock reactions likely hinge on margin trajectory, consensus reset to reflect EPS normalization vs GAAP, and progress on FHLB deleveraging; revenue miss vs SPGI may be less impactful given bank revenue definitional nuances and margin-driven earnings power [Values retrieved from S&P Global]* .
  • Dividend continuity (161st consecutive $0.33/share) and tangible book growth (to $19.79) support total return and valuation resilience amid expansion initiatives .