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HF

HBT Financial, Inc. (HBT)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 delivered resilient profitability: diluted EPS $0.64 vs $0.57 in Q3 and $0.58 in Q4 2023; Net interest margin (GAAP) 3.96% and tax-equivalent NIM 4.01% were down only 2 bps sequentially despite 100 bps Fed cuts since September 18, 2024 .
  • Noninterest income rebounded to $11.6M, aided by a $1.3M positive MSR fair value adjustment; noninterest expense fell 1.3% q/q; asset quality remained strong with NPAs/Assets 0.16% and annualized NCOs 0.08% .
  • Capital return enhanced: quarterly dividend raised 10.5% to $0.21 and a new $15M repurchase program authorized through January 1, 2026—both support shareholder yield while capital ratios improved q/q (CET1 13.21%) .
  • 2025 outlook: low-single-digit loan growth, flat/low-single-digit deposits, NIM expected to gradually increase with modest Fed cuts; noninterest expense guided to $31–$33M per quarter and asset quality to remain solid—potential catalyst from continued margin resilience and opportunistic buybacks/M&A .

What Went Well and What Went Wrong

What Went Well

  • “We ended 2024 with another quarter of strong earnings… resilient net interest margin (tax-equivalent basis) of 4.01%, down only 2 bps q/q despite Fed cutting 100 bps since Sep 18” — J. Lance Carter (CEO) .
  • Noninterest income up to $11.6M, driven by a $1.3M positive MSR fair value adjustment and higher wealth management fees; efficiency ratio (TE) improved to 50.68% .
  • Tangible book value per share rose to $14.80 (+1.7% q/q, +14.7% y/y); capital ratios increased across the board (CET1 13.21%, Tier 1 leverage 11.51%) .

What Went Wrong

  • Loan yields declined 13 bps q/q to 6.32%, partially offset by lower cost of funds (-8 bps to 1.39%); small loss ($0.3M) on sale of $2.4M of debt securities .
  • Provision for credit losses was $0.7M, reflecting portfolio growth and mix effects; net charge-offs annualized rose modestly to 0.08% from 0.07% in Q3 .
  • Brokered deposits declined $30M as planned (repayment at maturity), pressuring funding flexibility at the margin, though core deposits and retail balances increased .

Financial Results

Headline P&L, EPS, and Margins (oldest → newest)

MetricQ2 2024Q3 2024Q4 2024
Net Interest Income ($USD Millions)$47.028 $47.733 $47.401
Noninterest Income ($USD Millions)$9.610 $8.705 $11.630
Operating Revenue (Tax-Equivalent) ($USD Millions)$57.191 $56.990 $59.593
Diluted EPS ($)$0.57 $0.57 $0.64
Net Interest Margin (GAAP) (%)3.95% 3.98% 3.96%
Net Interest Margin (TE) (%)4.00% 4.03% 4.01%
ROAA (%)1.45% 1.44% 1.61%
Efficiency Ratio (TE) (%)52.10% 53.71% 50.68%

Balance Sheet and Asset Quality (oldest → newest)

MetricQ2 2024Q3 2024Q4 2024
Total Loans ($USD Billions)$3.385 $3.370 $3.466
Total Deposits ($USD Billions)$4.319 $4.281 $4.318
NPAs / Total Assets (%)0.17% 0.17% 0.16%
NCOs / Avg Loans (annualized) (%)0.08% 0.07% 0.08%
ACL / Loans (%)1.21% 1.22% 1.21%

Funding and Yield Dynamics (oldest → newest)

MetricQ2 2024Q3 2024Q4 2024
Loan Yield (%)6.35% 6.45% 6.32%
Cost of Funds (%)1.42% 1.47% 1.39%
Total Deposit Cost (%)1.26% 1.35% 1.27%

Segment Breakdown – Loans by Category ($USD Millions, period-end; oldest → newest)

CategoryQ2 2024Q3 2024Q4 2024
Commercial & Industrial$400.276 $395.598 $428.389
CRE – Owner Occupied$289.992 $288.838 $322.316
CRE – Non-Owner Occupied$889.193 $889.188 $899.565
Construction & Land Dev.$365.371 $359.151 $374.657
Multi-Family$429.951 $432.712 $431.524
1–4 Family Residential$484.335 $472.040 $463.968
Agricultural & Farmland$285.822 $297.102 $293.375
Municipal, Consumer & Other$240.543 $235.201 $252.352
Total Loans$3,385.483 $3,369.830 $3,466.146

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Loan GrowthFY 2025N/ALow single digits; stronger in H2; slight q/q decline in 1Q25 EOP with avg up slightlyNew
Deposit GrowthFY 2025N/AFlat to low single digitsNew
NIM TrajectoryFY 2025N/AGradual increase as fixed-rate assets reprice higher and deposit costs decrease slightly (assumes two 25 bp Fed cuts)New
Reinvestment PolicyFY 2025N/AReinvest at least half of quarterly securities run-offNew
Noninterest IncomeFY 2025N/AFlat vs 2024New
Noninterest ExpenseFY 2025N/A$31–$33M per quarterNew
Asset QualityFY 2025N/ARemain solid; may normalize if economy softensNew
Share RepurchasesThrough 1/1/2026Prior program expired 1/1/2025$15M new authorization; opportunistic useNew

Earnings Call Themes & Trends

Note: A Q4 2024 earnings call transcript was not available in the document set; themes below are derived from the Q4 earnings release and investor presentation .

TopicPrevious Mentions (Q2 & Q3)Current Period (Q4)Trend
Net Interest MarginNIM (TE) edged up to 4.00% in Q2; to 4.03% in Q3, with cost of funds rising modestly NIM (TE) 4.01%; resilience despite 100 bps Fed cuts since Sep 18 Stable to slightly down q/q, resilient
Deposit Costs & BetaCost of deposits 1.26% (Q2); 1.35% (Q3); deposit beta commentary rising in tightening cycle Cost of total deposits fell to 1.27%; current falling-rate deposit beta ~13.1% Improving costs
Loan Growth & MixQ2 loan growth +$39.5M; Q3 declined -$15.7M (payoffs) Q4 loans +$96.3M; higher line usage, seasonal grain elevator balances, two lines funded near year-end repaid after Re-accelerating
Asset QualityNPAs ~0.17%, low NCOs (Q2–Q3) NPAs/Assets 0.16%; NCOs 0.08% annualized; ACL/Loans 1.21% Solid; steady
Capital ReturnQ2 repurchases ($18.74 avg); no repurchases in Q3 Dividend +10.5% to $0.21; $15M buyback authorized More shareholder friendly
CRE ExposureMonitoring office/retail; no stress flagged earlier Office CRE ~5% of loans; performing well; diversified CRE book (presentation) Risk contained

Management Commentary

  • “Underpinning this strong financial performance was our resilient net interest margin (tax equivalent basis) of 4.01%… despite the Federal Reserve cutting the federal funds target range by 100 basis points since September 18, 2024… asset quality remains exceptional…” — J. Lance Carter, President & CEO .
  • “We are very pleased to announce… increase our quarterly cash dividend by $0.02 per share, or 10.5%, while maintaining more than sufficient capital to support the continued growth of the Company.” — Mr. Carter on dividend .
  • “Looking ahead to 2025… balance sheet well positioned… capital levels and operational structure support attractive acquisition opportunities… asset quality remains strong with no significant signs of stress…” — CEO outlook .

Q&A Highlights

  • No formal Q4 2024 earnings call transcript was available. Management’s investor presentation outlines: NIM expected to gradually increase in 2025 (assumes two 25 bp Fed cuts), noninterest income flat, and expense between $31–$33M per quarter; deposit balances flat/low-single-digit growth; asset quality to remain solid .
  • Deposit cost dynamics: total deposit cost 1.27% in Q4; presentation highlights beta behavior and composition (top 100 depositors 14% of deposits; uninsured/unsecured ~$641M or 15%) .
  • Capital deployment: $15M repurchase capacity through 1/1/2026; opportunistic approach .

Estimates Context

  • Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue was unavailable due to a provider limit during retrieval. As such, formal beat/miss analysis vs consensus cannot be assessed.
  • Note: We attempted to retrieve “Primary EPS Consensus Mean” and “Revenue Consensus Mean” for Q4 2024; SPGI daily request limit was exceeded, preventing access to estimate values. Values would have been retrieved from S&P Global if accessible.

Key Takeaways for Investors

  • Margin resilience is the core narrative: NIM (TE) at 4.01% and only slightly lower q/q despite significant Fed cuts—supports earnings durability into 2025; management expects gradual NIM improvement with modest rate declines .
  • Strong asset quality and conservative credit posture (NPAs 0.16%, ACL/Loans 1.21%) reduce tail risk and support capital deployment (dividends/buybacks) .
  • Loan growth re-accelerated in Q4 (+$96M q/q), with healthy commercial line usage and seasonal factors; watch 1Q25 for typical seasonal paydowns and average balances trending slightly up .
  • Shareholder yield enhanced: dividend lifted to $0.21 and $15M buyback authorized; with CET1 13.21% and TCE/TA 9.42%, capital return is a tangible catalyst if NIM executes per plan .
  • Funding costs improved (cost of funds 1.39%) and deposit pricing eased; ongoing mix management remains an earnings lever in a falling-rate environment .
  • Near-term trading: potential positive reactions to margin stability and capital return; medium term thesis hinges on disciplined deposit pricing, limited CRE office exposure (~5%) and continued operating efficiency .