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LANDMARK BANCORP INC (LARK)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered solid profitability: diluted EPS $0.85 (+13% QoQ, +25% YoY), net earnings $4.9M; ROAA 1.21%, ROAE 13.00%, efficiency ratio 60.7% .
  • Margin held steady at 3.83% (tax-equivalent), with net interest income up 3.0% QoQ; non-interest income up 12.2% QoQ on stronger mortgage sales and fees .
  • Asset quality improved: non-performing loans fell $7.0M to $10.0M; allowance coverage rose to 123% of NPLs; loan-to-deposit ratio eased to 83.4% from 86.6% .
  • Capital and book value strengthened: book value per share $26.92; tangible book $20.96; equity/asset ratio 9.63% .
  • Stock reaction catalyst: Board declared a $0.21 cash dividend (Nov 26) and a 5% stock dividend (Dec 15), the 25th consecutive year of a 5% stock dividend .

What Went Well and What Went Wrong

What Went Well

  • Net interest income growth and steady margin: “Net interest income… increased $411,000… margin held steady at 3.83%” underpinning earnings quality .
  • Non-interest income momentum: +$442K QoQ led by mortgage gains (+$208K) and fees (+$184K), supporting revenue diversification .
  • Credit clean-up and liquidity: NPLs down $7.0M due to resolution of a single commercial credit; borrowings reduced $69.0M, deposits up $51.6M (mix shift into CDs and non-interest DDA) .

Management quote:

  • “We made significant progress… nonperforming loans decreased $7.0 million… majority [of] net loan charge-offs… related to a single previously disclosed commercial loan.” — CEO Abby Wendel .

What Went Wrong

  • Elevated net charge-offs: $2.3M in Q3 (vs. $40K in Q2), concentrated in the resolved commercial relationship; allowance ratio declined QoQ to 1.10% of loans .
  • Deposit growth reliance on brokered funds: period-end increase driven in part by brokered deposits; average interest-bearing deposit cost rose 4 bps QoQ to 2.18% .
  • Slight uptick in early delinquencies QoQ: loans 30–89 days delinquent increased to $4.9M from $4.3M, though still 0.43% of gross loans .

Financial Results

Core profitability and ratios

MetricQ3 2024Q2 2025Q3 2025
Net Interest Income ($USD)$11,604 $13,683 $14,094
Non-Interest Income ($USD)$4,253 $3,626 $4,068
Net Earnings ($USD)$3,931 $4,404 $4,930
Diluted EPS ($)$0.68 $0.75 $0.85
Provision for Credit Losses ($USD)$500 $1,000 $850
Net Interest Margin % (tax-equivalent)3.30% 3.83% 3.83%
Efficiency Ratio % (Adj)66.5% 62.8% 60.7%
ROAA % (Annualized)1.00% 1.11% 1.21%
ROAE % (Annualized)11.82% 12.25% 13.00%
Effective Tax Rate %18.1% 17.7% 18.7%

S&P Global “Revenue” and estimates context

Note: For banks, S&P Global “Revenue” reflects net interest income after provision plus non-interest income.

MetricQ3 2024Q2 2025Q3 2025
SPGI Revenue ($USD) Actual$15,357,000*$16,309,000*$17,312,000*
Net Income Normalized ($USD) Actual$3,931,000*$4,404,000*$4,930,000*
Primary EPS Consensus Mean ($)N/A*N/A*N/A*
Revenue Consensus Mean ($USD)N/A*N/A*N/A*

Values retrieved from S&P Global.*

Balance sheet and credit KPIs

MetricQ3 2024Q2 2025Q3 2025
Gross Loans ($USD)$1,001,849,000 $1,117,784,000 $1,118,053,000
Average Loans ($USD)$985,659,000 $1,081,865,000 $1,108,545,000
Total Deposits ($USD)$1,275,502,000 $1,273,901,000 $1,325,500,000
Loan-to-Deposit Ratio %77.64% 86.62% 83.36%
Non-Performing Loans ($USD)$13,415,000 $16,984,000 $9,999,000
ACL / Gross Loans %1.15% 1.23% 1.10%
NPL Coverage (ACL/NPLs) %86.05% 81.03% 123.00%
Net Loan Charge-offs to Avg Loans %0.00% 0.01% 0.83%
Equity / Assets %8.93% 9.13% 9.63%
Book Value per Share ($)$24.18 $25.66 $26.92
Tangible Book Value per Share ($)$18.11 $19.66 $20.96

Loan portfolio mix (period-end, selected categories)

CategoryQ2 2025Q3 2025
One-to-Four Family Residential RE ($USD)$377,133,000 $381,641,000
Commercial Real Estate ($USD)$370,455,000 $389,574,000
Commercial ($USD)$204,303,000 $186,656,000
Construction & Land ($USD)$26,373,000 $19,741,000
Consumer ($USD)$32,234,000 $33,660,000

Guidance Changes

Landmark does not provide formal numeric guidance; capital returns were updated this quarter.

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash Dividend per ShareQ4 2025 (Payable Nov 26; Record Nov 12)$0.21 in Q2/Q3 2025 $0.21 Maintained
Stock DividendDec 15, 2025 (Record Dec 1)5% stock dividend annually (longstanding) 5% declared; 25th consecutive year Maintained
Revenue/Margins/OpEx/OI&E/Tax RateN/AN/ANo formal guidance providedN/A

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025)Previous Mentions (Q2 2025)Current Period (Q3 2025)Trend
Margin trajectoryNIM expanded 25 bps to 3.76% on lower funding costs NIM improved to 3.83% (+7 bps QoQ) NIM flat at 3.83%; margin durable Stable/high
Loan growth+$22.6M QoQ; broad-based CRE, construction, mortgage +$42.9M QoQ; strong residential, commercial, CRE Average loans +$26.7M QoQ; period-end flat; mix shift to CRE/resi Moderating at PE; strong averages
Deposits & funding+$7.1M QoQ; reduced borrowings Deposits -$61.9M QoQ; brokered declined; borrowings +$105.9M Deposits +$51.6M QoQ; brokered + core non-interest DDA; borrowings -$69.0M Improving liquidity
Asset qualityNPLs ~flat; early delinquencies up to $10.0M NPLs up to $17.0M; added provision $1.0M NPLs down $7.0M to $10.0M; net charge-offs $2.3M on one credit Mixed: cleaner NPLs, higher NCOs
Capital & book valueBVPS $24.69; equity/assets 9.04% BVPS $25.66; equity/assets 9.13% BVPS $26.92; equity/assets 9.63% Strengthening
Macro (Kansas)Unemployment 3.8%; housing resilient; tariff uncertainty noted Unemployment 3.8%; housing median price +5.6% YoY Unemployment 3.8%; median price +5.5% YoY; fast sales Supportive local backdrop

Management Commentary

  • “Landmark reported another solid quarter of earnings and increased profitability… Average loans this quarter grew by $26.7 million… Nonperforming loans decreased $7.0 million.” — Abby Wendel, CEO .
  • “Net interest income… increased $411,000… interest income on loans increased $597,000… NIM held steady at 3.83%.” — Mark Herpich, CFO .
  • “Brokered deposits were the primary driver of deposit growth… we reduced reliance on FHLB and other borrowing sources.” — Abby Wendel, CEO .
  • “Unrealized net losses on the investment portfolio declined by $4.7M to $9.2M; average duration ~3.7 years.” — Mark Herpich, CFO .

Q&A Highlights

  • Q3 2025: No analyst questions; prepared remarks only .
  • Q2 2025: Provisioning and NPL trajectory discussed; management believes reserves are adequate and noted a $2.6M CRE credit brought current post quarter-end; deposit seasonality and brokered funding vs. FHLB capacity clarified (~$150M capacity) .

Estimates Context

  • S&P Global consensus coverage appears limited for LARK; Primary EPS and Revenue consensus means were unavailable for Q3 2025, Q2 2025, and Q3 2024. Actual S&P “Revenue” and Net Income Normalized values align with reported results but no Street “consensus” was present for comparison.*
    Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Earnings quality was strong and diversified: net interest income growth plus non-interest income resiliency drove EPS $0.85 and improved efficiency to 60.7% .
  • Margin durability stands out amid deposit mix shifts; NIM held at 3.83% while deposit costs rose modestly, indicating disciplined pricing .
  • Balance sheet de-risking: NPLs fell significantly with resolution of a single commercial credit; coverage improved to 123% despite elevated Q3 net charge-offs .
  • Liquidity posture improved: deposits up $51.6M and borrowings down $69.0M; loan-to-deposit ratio back to 83.4% from 86.6% .
  • Capital build continues: tangible book per share up to $20.96, equity/assets 9.63%—providing flexibility for growth and consistent dividends .
  • Near-term catalysts: declared $0.21 cash dividend and 5% stock dividend (25th consecutive year) may support investor sentiment and liquidity .
  • Watch items: early delinquency uptick QoQ, brokered deposit dependence, and concentrated credit events—management emphasized vigilance and relationship banking .