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GLACIER BANCORP, INC. (GBCI)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 EPS rose to $0.54, up 20% QoQ and 10% YoY; net income increased to $61.8M (+21% QoQ, +14% YoY). Net interest margin expanded 14 bps QoQ to 2.97% and 41 bps YoY, driven by lower deposit costs and mix shift toward loans .
  • Operating leverage improved: net interest income increased to $191.4M (+6% QoQ, +15% YoY) while non-interest expense declined 3% QoQ to $141.0M; efficiency ratio fell to 60.50% from 64.92% in Q3 .
  • Credit remained solid; non-performing assets were 0.10% of assets, early-stage delinquencies fell to 0.19% of loans, though net charge-offs rose to $5.2M due to a few isolated loans (including deposit overdrafts) .
  • 2025 outlook improved: management guided net interest margin to 3.20%–3.25% for FY25, aided by securities runoff, lower-cost funding, loan repricing (~$2B repricing at +100–125 bps), and the Bank of Idaho deal; expenses guided to $151–$154M per quarter ex-BOI (BOI adds $9–$10M per quarter) .
  • Catalysts: sustained NIM expansion, deposit cost moderation (spot deposit rate 1.26% at year-end; December spot margin 2.99%), deleveraging via FHLB maturities ($1.36B in 2025), and accretive M&A (Bank of Idaho) .

What Went Well and What Went Wrong

What Went Well

  • Net interest margin expansion (2.97% TE, +14 bps QoQ; +41 bps YoY) on lower deposit costs and higher interest-bearing cash balances; CFO attributed improvement to remix of securities cash flow and lower funding cost .
  • Operating discipline: non-interest expense declined $3.7M QoQ to $141.0M; efficiency ratio improved to 60.50% from 64.92% in Q3 .
  • Management confidence and strategic execution: “The Glacier team once again delivered another strong quarter and year… Our positive earnings trends should continue into 2025,” said CEO Randy Chesler; margin trajectory guided higher to 3.20%–3.25% for FY25 .

What Went Wrong

  • Net charge-offs rose to $5.2M (vs. $2.8M in Q3), primarily from a few isolated loans and $2.1M in deposit overdraft net charge-offs; provision expense increased to $8.5M (including $2.5M for unfunded commitments) .
  • Total deposits fell $168M QoQ (to $20.547B), with seasonally lower non-interest bearing balances late in the quarter; certificate accounts declined $145M QoQ amid repricing .
  • 2024 net income declined 15% YoY, pressured by higher funding costs and $8.6M increase in acquisition-related expenses tied to Wheatland and RMB (and associated provision for credit losses) .

Financial Results

MetricQ4 2023Q2 2024Q3 2024Q4 2024
Diluted EPS ($)0.49 0.39 0.45 0.54
Net Income ($USD Thousands)54,316 44,708 51,055 61,754
Total Income ($USD Thousands)197,321 198,682 214,935 222,992
Net Interest Income ($USD Thousands)166,456 166,478 180,231 191,443
Net Interest Margin (tax-equivalent, %)2.56 2.68 2.83 2.97
Loan Yield (%)5.34 5.58 5.69 5.72
Core Deposit Cost (%)1.24 1.36 1.37 1.29
Total Funding Cost (%)1.72 1.80 1.79 1.71
Efficiency Ratio (%)65.20 67.97 64.92 60.50

KPIs

KPIQ4 2023Q2 2024Q3 2024Q4 2024
Total Deposits ($USD Thousands)19,929,167 20,101,759 20,714,764 20,546,994
Non-Interest Bearing Deposits (% of Total)30% 30% 31% 30%
Loans Receivable ($USD Thousands)16,198,082 16,851,991 17,181,187 17,261,849
Loans Receivable, Net ($USD Thousands)16,005,325 16,651,036 16,976,017 17,055,808
ROA (annualized, %)0.77 0.66 0.73 0.87
ROE (annualized, %)7.40 5.77 6.34 7.62
Non-Performing Assets (% of Subsidiary Assets)0.09 0.06 0.10 0.10
Early-Stage Delinquencies 30–89 days ($USD Thousands)49,967 49,678 56,213 32,228
Net Charge-Offs ($USD Thousands)3,695 2,890 2,766 5,170
ACL as % of Loans (%)1.19 1.19 1.19 1.19

Loan Portfolio Breakdown (Regulatory Classification)

Category ($USD Thousands)Dec 31, 2023Sep 30, 2024Dec 31, 2024
Residential Real Estate1,704,544 1,837,697 1,858,929
Commercial Real Estate (Total)6,778,684 7,123,330 7,251,134
Commercial & Industrial1,363,479 1,387,538 1,395,997
Agriculture772,458 1,047,320 1,024,520
1–4 Family (Total)2,175,219 2,539,914 2,558,221
Multifamily Residential796,538 921,138 895,242
Home Equity Lines of Credit979,891 1,004,300 1,005,783
Other Consumer229,154 221,517 209,457
States & Political Subdivisions834,947 993,871 983,601
Other204,111 188,792 183,894
Total Loans (incl. HFS)16,213,773 17,227,313 17,294,909
Less: Loans Held for Sale(15,691) (46,126) (33,060)
Total Loans Receivable16,198,082 16,851,991 17,261,849

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest Margin (TE)FY 2025Exit 2024 “around 3%” (Q2 commentary) 3.20%–3.25% for FY25; December 2024 spot ~2.99% Raised
Expense Run-Rate (Non-Interest Expense)FY 2025 (per quarter)Q4 2024 guide $143–$145M (core) $151–$154M ex-BOI; BOI adds $9–$10M per quarter after close Raised (ex-BOI); additive BOI
Securities Cash Flow (Principal & Interest)2025~$250M per quarter through next couple quarters (Q3) $275M in Q1; +$50M Treasury maturity in Q2; +$270M in Q4; meaningful quarterly maturities into 2026–2027 Raised/More specific
Loan Repricing Lift2025Not quantified previously~$2B of loans repricing at +100–125 bps vs current yields New detail
FHLB Advances Maturities2025Not specified in prior calls$1.36B of $1.8B FHLB term advances mature in 2025; plan meaningful paydown (deleveraging) New detail
Organic Loan Growth2025Low to mid-single digits in 2H24 Low to mid-single digits (organic); BOI additive Maintained
DividendOngoing$0.33/share declared Sept 24, 2024 $0.33/share declared Nov 20, 2024 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024)Previous Mentions (Q3 2024)Current Period (Q4 2024)Trend
Net Interest Margin trajectoryGuided to ~3% exit 2024; June margin 2.70% Q3 margin 2.83% (+15 bps QoQ) December spot margin ~2.99%; 2025 NIM 3.20%–3.25% Improving
Deposit costsStabilizing; testing lower rates; core cost 1.36% Spot deposit rate 1.35% at 9/30 Spot deposit rate 1.26% at 12/31; core cost 1.29% Moderating
Securities runoffExpect ~$250M/quarter; larger maturities begin late 2025 ~$250M/quarter ongoing $275M Q1; +$50M Q2; +$270M Q4; more into 2026–2027 Accelerating into late 2025
Funding/deleveragingPaid off $2.74B BTFP in Q1; used FHLB/cash Reduced overnight FHLB in July; total FHLB $1.8B $1.36B FHLB term advances mature in 2025; plan paydown Deleveraging opportunity
Loan growth/pipelineLow to mid-single digits; construction migration to term loans Organic growth modest; optimism but payoffs elevated Organic low to mid-single digits; early-stage opportunities rising Stable/Gradually improving demand
New origination yieldsMid-to-upper 7% Mid-to-upper 7% ~7.34% in Q4; repricing lift expected Supportive for NIM
Credit qualityNPA 0.06%; delinquencies down QoQ NPA 0.10%; delinquencies up NPA 0.10%; early delinquencies down; charge-offs up on isolated loans Stable; watch charge-offs
M&AWheatland closed (Jan 2024) RMB branches closed (July 2024) Proposed acquisition of Bank of Idaho; immediate accretion, minimal TBV dilution Additive scale

Management Commentary

  • CEO Randy Chesler: “The Glacier team once again delivered another strong quarter and year… Our positive earnings trends should continue into 2025” .
  • CFO Ron Copher: “The remix of lower yield cash flow from the securities portfolio combined with the lower funding cost contributed to the improved net interest margin” .
  • Treasurer Byron Pollan: “Our December spot margin was 2.99%. For full year 2025, I think our margin will land somewhere in the range of 3.20% to 3.25%” .
  • Strategic M&A: The proposed Bank of Idaho acquisition is “very attractive… minimal tangible book value dilution, immediate accretion… paid to trade ratio of only 76%” .

Q&A Highlights

  • Margin and deposit costs: December spot margin ~2.99%; spot deposit rate 1.26% at 12/31; full-year 2025 NIM guided to 3.20%–3.25% .
  • Loan repricing and yields: ~$2B of loans repricing in 2025 at +100–125 bps lift; new origination yields ~7.34% in Q4 .
  • Expenses: Q4 reported $141M; normalized ~$143M; 2025 run-rate $151–$154M per quarter ex-BOI; BOI adds $9–$10M per quarter post-close; remaining cost savings ~$5M (Wheatland ~$2.1M; RMB ~$2.8M) .
  • Securities cash flow: ~$275M in Q1; ~$50M treasury maturity in Q2; ~$270M in Q4; increased maturities into 2026–2027 .
  • Credit tone: benign overall; charge-offs up due to “end-of-year cleanup” and isolated weaker operators; no systemic industry/geography issues flagged .

Estimates Context

  • S&P Global consensus EPS and revenue estimates for Q4 2024 were unavailable at time of writing due to request limit; comparison to Street could not be retrieved. As a result, we cannot classify beats/misses vs consensus for this quarter [SPGI request error].
  • Implications: Given management’s higher NIM guidance (3.20%–3.25% for 2025), Street models may need to raise NIM and net interest income trajectories, incorporate BOI-related expenses ($9–$10M/quarter) and potential securities runoff-driven deleveraging; expense run-rate also higher than 2024 core levels .

Key Takeaways for Investors

  • Margin expansion is the core driver: Q4 NIM reached 2.97%; December spot ~2.99%; 2025 guided to 3.20%–3.25%, supported by loan repricing and securities runoff—key positive for earnings power and valuation narrative .
  • Deposit cost moderation continues: core deposit cost fell to 1.29%; spot deposit rate 1.26%—watch CD repricing (60% rolls in Q1) for further cost relief .
  • Balance sheet deleveraging: $1.36B of FHLB term advances mature in 2025 with intent to pay down; securities maturities elevate liquidity—lower funding costs and improved mix should continue .
  • Solid credit but monitor charge-offs: NPA steady at 0.10%; early delinquencies down; net charge-offs increased on isolated items (incl. overdrafts)—risk remains contained per management .
  • Operating efficiency trajectory improving: non-interest expense fell QoQ and efficiency ratio improved to 60.50%; 2025 run-rate higher on growth and controls, but BOI adds scale and accretion .
  • M&A adds strategic presence and NIM tailwind: proposed Bank of Idaho offers immediate accretion and boosts presence in high-growth markets; anticipate integration and expense ramp starting mid-2025 .
  • Near-term trading setup: Positive narrative momentum on NIM and deposit costs with clear 2025 roadmap; watch upcoming quarter for continued margin progression, deposit mix shifts, and execution on deleveraging/securities runoff .

Appendix: Additional Q4 2024 Materials

  • Q4 earnings press release scheduling: company reported results on Jan 23, 2025; call held Jan 24, 2025 .
  • Dividend: $0.33/share declared Nov 20, 2024; 159th consecutive regular dividend .