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GC

GREENE COUNTY BANCORP INC (GCBC)·Q4 2025 Earnings Summary

Executive Summary

  • Q4 FY2025 produced net income of $9.3M and EPS of $0.55, up from $6.7M and $0.40 in Q4 FY2024; net interest margin expanded to 2.37% as asset yields repriced higher and deposit costs declined .
  • Sequentially, EPS improved vs Q3 ($0.47) and Q2 ($0.44), with net interest income rising to $16.7M; efficiency ratio stayed ~51%, reflecting disciplined expense control amid growth .
  • Credit quality improved: nonperforming loans fell to $3.1M (0.19% of net loans), net charge-offs were de minimis ($44K), and ACL/loans stood at 1.24% .
  • Strategic catalysts: announced expansion into Saratoga County and an annual dividend increase to $0.40 (+11.1%), signaling confidence in sustainable growth and capital generation .

What Went Well and What Went Wrong

What Went Well

  • Margin expansion and revenue mix: Net interest margin rose to 2.37% (vs 1.97% YoY), with net interest income +$3.8M YoY; management noted repricing of loans/securities and tactical deposit rate actions aligned with Fed cuts .
  • Credit quality resilience: NPLs fell to 0.19% of net loans; provision was a benefit of $880K in the quarter due to improved qualitative factors, with very low net charge-offs ($44K) .
  • Strategic momentum: Entering Saratoga County, adding a sixth county footprint; CEO emphasized record earnings in 16 of last 17 years and top rankings in commercial mortgage lending in the region .

What Went Wrong

  • Effective tax rate increased to 14.8% in Q4 (from 1.4% in Q4 FY2024), driven by higher pre-tax income and a lower mix of tax-exempt income relative to pre-tax results, creating a headwind to net income conversion .
  • Noninterest expense up 5.0% YoY to $10.4M in Q4 on higher service/data processing and software costs; FY OpEx rose 5.6% to $39.4M reflecting growth investments and higher allowance on unfunded commitments .
  • Deposit mix shifted toward interest-bearing categories (NOW and CDs) while noninterest-bearing deposits declined YoY, elevating funding sensitivity despite spread/margin gains .

Financial Results

MetricQ4 2024Q2 2025Q3 2025Q4 2025
Interest income ($USD Millions)$27.33 $29.42 $29.78 $30.74
Interest expense ($USD Millions)$14.47 $15.35 $13.57 $14.03
Net interest income ($USD Millions)$12.86 $14.07 $16.21 $16.71
Provision for credit losses ($USD Millions)($0.15) $0.48 $1.08 ($0.88)
Noninterest income ($USD Millions)$3.72 $3.88 $3.86 $3.77
Noninterest expense ($USD Millions)$9.90 $9.39 $10.04 $10.39
Income before taxes ($USD Millions)$6.83 $8.08 $8.94 $10.96
Tax provision ($USD Millions)$0.10 $0.59 $0.89 $1.62
Net income ($USD Millions)$6.73 $7.49 $8.05 $9.33
Diluted EPS ($USD)$0.40 $0.44 $0.47 $0.55
Net interest margin (%)1.97% 2.04% 2.32% 2.37%
Net interest rate spread (%)1.72% 1.80% 2.12% 2.14%
Efficiency ratio (%)59.71% 52.31% 50.04% 50.77%
Return on average assets (%)1.00% 1.05% 1.12% 1.28%
Return on average equity (%)13.36% 13.84% 14.41% 15.98%

KPIs (balance sheet and credit)

KPIQ2 2025Q3 2025Q4 2025
Total assets ($USD Billions)$2.97 $3.01 $3.04
Net loans receivable ($USD Billions)$1.53 $1.60 $1.61
Deposits ($USD Billions)$2.47 $2.65 $2.64
Borrowings ($USD Millions)$250.9 $94.0 $128.1
Shareholders' equity to total assets (%)7.37% 7.61% 7.85%
Nonperforming assets / total assets (%)0.14% 0.10% 0.10%
NPLs / net loans (%)0.26% 0.18% 0.19%
ACL / total loans (%)1.30% 1.31% 1.24%
Pre-provision net income (non-GAAP, $USD Millions)$7.97 $9.14 $8.45

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per share (annual)As of Q4 FY2025$0.36 (FY2025 declared per share) $0.40 (quarterly dividend $0.10; annual rate implied) Raised (+11.1%)
Formal financial guidance (revenue, margins, OpEx, OI&E, tax rate)FY2026/Q1None provided None provided Maintained (no guidance)

Earnings Call Themes & Trends

Note: The company’s materials do not include a public earnings call transcript for Q4; themes below reflect management commentary from earnings releases.

TopicPrevious Mentions (Q2 FY2025)Previous Mentions (Q3 FY2025)Current Period (Q4 FY2025)Trend
Deposit pricing strategy and rate environmentImplemented strategic reduction in deposit rates aligned with Fed cuts; asset yields rising Continued deposit rate reductions and asset repricing; NIM up Further NIM expansion; spread +42 bps YoY; deposit costs lower in key categories Improving margin trajectory
Loan growth focus (CRE-led)CRE +$46.4M in 6M; broad-based loans up CRE +$111.9M in 9M; loans +$118.0M CRE +$117.9M FY; net loans +$127.0M YoY Sustained growth
Credit qualityNPLs 0.26% of loans; net charge-offs minimal NPLs 0.18%; allowance stable; charge-offs low NPLs 0.19%; provision a benefit; net charge-offs $44K Stable-to-better
Capital & liquidityBorrowings $250.9M; liquidity strong Borrowings $94.0M; liquidity improved Borrowings $128.1M; strong capital and liquidity Reduced leverage vs prior year
Geographic expansion——Saratoga County branch announced (footprint to six counties) Expansion initiated
Effective tax rateLower effective rate due to tax-exempt mix and credits 9.9% in Q3; mix effects 14.8% in Q4; lower tax-exempt mix relative to pre-tax income Higher ETR headwind in Q4

Management Commentary

  • “I am pleased to report record high net income for the fiscal year ended June 30, 2025, marking 16 years of the past 17 years that our Company has achieved record earnings… we are excited to announce plans to expand into Saratoga County…” — Donald Gibson, President & CEO .
  • Recognition: Ranked #1 commercial mortgage lender in New York’s Capital Region (2024 volume), and one of the Capital Region’s fastest-growing large companies (revenue >$100M), underscoring franchise strength and growth culture .
  • Strategy highlights: Balance sheet positioned for higher yields via loan/securities repricing, while deposit rates were reduced competitively to reflect macro rate cuts; sustained customer relationship growth supports funding .

Q&A Highlights

  • Company materials for Q4 FY2025 do not provide a public earnings call transcript or Q&A section; no additional clarifications beyond the press release were available .

Estimates Context

  • S&P Global Wall Street consensus coverage appears limited for GCBC in Q4 FY2025; consensus for EPS and target price was unavailable at the time of review (no beat/miss determination possible). Values retrieved from S&P Global.*
  • Actual reported EPS: $0.55 . Revenue comparisons use operating components (net interest income + noninterest income) rather than a formal “revenue” line in company reporting .

Key Takeaways for Investors

  • Margin expansion and spread improvement are the core drivers of earnings momentum; sequential NIM increases (2.04% → 2.32% → 2.37%) suggest further upside if asset repricing and deposit cost discipline continue .
  • Credit quality is strong with very low losses and improving NPL metrics; provision benefit in Q4 reflects better qualitative factors despite modest macro forecast deterioration .
  • Deposit mix has tilted toward interest-bearing categories (NOW/CDs), implying sensitivity to rate moves; watch funding costs if competitive pressures rise despite recent decreases in certain categories .
  • Borrowings materially lower versus prior year and sequentially off Q2 peak, supporting improved liquidity optics and reduced interest expense vulnerability .
  • Dividend increase to $0.40 (annualized) and expansion into Saratoga County are tangible signals of confidence and growth; near-term trading catalysts include continued NIM expansion and credit performance .
  • Effective tax rate uptick in Q4 muted net income conversion; monitor mix of tax-advantaged income sources and credits as drivers of ETR normalization .
  • With limited external estimate coverage, investors should anchor on internal KPIs (NIM, efficiency ratio, NPLs, deposit mix) and management’s strategic actions for assessing trajectory .

Footnote: *Values retrieved from S&P Global.