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MP

MID PENN BANCORP INC (MPB)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 EPS of $0.71 beat Street consensus of $0.63 on stronger net interest margin, disciplined expense control, and modest loan/deposit growth; adjusted EPS was $0.72, up 12% year over year . Values retrieved from S&P Global for consensus.
  • Net interest margin expanded 16 bps sequentially and 40 bps year over year to 3.37% as deposit repricing lowered cost of funds to 2.48%; loans yielded 6.05% despite Fed cuts, reflecting pricing discipline .
  • Asset quality remained manageable though nonperforming assets rose to $25.4M (0.46% of assets), driven by three commercial credits; ACL/loans held flat at 0.80% and net recoveries were de minimis .
  • Dividend of $0.20 was maintained (58th consecutive), and the $15M buyback was reauthorized through April 30, 2026 with ~$5M remaining; TBV/share increased to $27.58 and BV/share to $34.50 .
  • Near-term catalysts: continued NIM tailwinds from deposit repricing, integration of William Penn (closed April 30), and capital return via dividend/buyback; monitoring NPA uptick and deposit competition .

What Went Well and What Went Wrong

What Went Well

  • Net interest margin expansion to 3.37% on reduced deposit costs from repricing initiatives; cost of funds declined to 2.48% sequentially . “We delivered a solid beat of consensus…healthy net interest margin expansion…decrease in deposit costs resulting from repricing initiatives…” — Rory G. Ritrievi .
  • Operating leverage and efficiency: core efficiency ratio improved to 62.79% (from 63.94% in Q4 and 68.80% YoY); bonuses down and overall noninterest expense modestly lower QoQ .
  • Balance sheet growth with discipline: loans +$48.1M (4.4% annualized), deposits +$42.3M (3.7% annualized); BV/share $34.50 and TBV/share $27.58 improved sequentially and YoY .

What Went Wrong

  • Noninterest income fell 10.2% YoY and 14.8% QoQ to $5.24M, primarily due to lower BOLI-related benefits and insurance commissions .
  • Asset quality mixed: nonperforming assets increased to $25.4M (from $22.7M in Q4), driven by three commercial loans; NPLs/loans rose to 0.54% (from 0.51%) .
  • Ongoing deposit pricing headwinds amid competitive markets; average deposit cost was 2.45% (up 2 bps YoY) despite repricing, highlighting persistent competition for funding .

Financial Results

Income Statement and EPS

Metric (USD)Q3 2024Q4 2024Q1 2025
Net Interest Income ($MM)$40.17 $41.28 $42.51
Provision/(Benefit) for Credit Losses ($MM)$0.52 $0.33 $0.30
Noninterest Income ($MM)$5.18 $6.15 $5.24
Noninterest Expense ($MM)$29.96 $30.91 $30.64
Net Income ($MM)$12.30 $13.23 $13.74
Diluted EPS ($)$0.74 $0.72 $0.71
Adjusted EPS (ex non-recurring) ($)$0.75 $0.71 $0.72

Key Margins and Profitability

RatioQ3 2024Q4 2024Q1 2025
Tax-Equivalent NIM (%)3.13 3.21 3.37
Cost of Funds (%)2.77 2.66 2.48
Efficiency Ratio/Core Efficiency Ratio (%)64.89 63.94 62.79
Return on Avg Assets (%)0.89 0.96 1.01
ROATCE (%)11.69 11.07 10.84

Asset Quality

MetricQ3 2024Q4 2024Q1 2025
NPLs / Total Loans (%)0.39 0.51 0.54
NPAs / Total Assets (%)0.32 0.41 0.46
ACL / Loans (%)0.80 0.80 0.80
Net (Recoveries)/Charge-offs to Avg Loans (%)0.031 0.037 (0.0003)

Balance Sheet KPIs (Ending Balances)

Metric ($USD Billions)Q3 2024Q4 2024Q1 2025
Total Assets$5.53B $5.47B $5.55B
Total Loans (net of unearned)$4.432B $4.443B $4.491B
Total Deposits$4.707B $4.690B $4.732B
Shareholders’ Equity$0.573B $0.655B $0.668B
Book Value / Share ($)$34.48 $33.84 $34.50
Tangible Book Value / Share ($)$26.36 $26.90 $27.58

Street vs Actual (Q1 2025)

MetricConsensusActualSurprise
Primary EPS ($)0.630.71 +0.08 (Bold beat)
Revenue ($MM)47.1047.75 (NII+Noninterest) +0.65

Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per common shareQ1 2025$0.20 (Q4 2024) $0.20 (payable May 26, 2025) Maintained
Treasury stock repurchase programThrough Apr 30, 2026Authorization $15M, ~$5M remaining (Dec 31, 2024) Reauthorized; ~$5M remaining (Mar 31, 2025) Extended
William Penn mergerClose timingExpected mid-Q2 2025 Closed Apr 30, 2025; assets ~$6.3B combined Executed

Earnings Call Themes & Trends

Note: A Q1 2025 earnings call transcript was not available; themes are derived from company disclosures.

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
Net interest margin and deposit costsNIM 3.13%; cost of funds 2.77% (deposit growth) . Q4 NIM 3.21%; cost 2.66% (repricing, lower borrowings) .NIM 3.37%; cost 2.48% (repricing from Fed cuts) .Improving
Asset qualityNPAs $17.7M; one CRE nonaccrual added .NPAs $22.7M; two commercial + two CRE to nonaccrual .NPAs $25.4M; three commercial loans added; delinquency 0.50% .
Loan growth disciplineQ3 loans +6.2% annualized .Q4 loans +1.0% annualized .Q1 loans +4.4% annualized .
Deposit trendsQ3 deposits +18.6% annualized .Q4 deposits −1.4% annualized .Q1 deposits +3.7% annualized; avg cost 2.45% .
M&A and integrationInsurance business acquired .William Penn merger announced (all-stock) .Shareholder approvals (Apr 2) ; closed Apr 30 .
Capital/TBVTBV/share improved to $26.36 .TBV/share $26.90; capital raise completed .TBV/share $27.58; BV/share $34.50 .

Management Commentary

  • “We delivered a solid beat of consensus estimates on earnings per share. That beat was the result of healthy net interest margin expansion, moderate growth in both loans and deposits, strong asset quality performance and an improvement in the efficiency ratio.” — Rory G. Ritrievi, Chair, President & CEO .
  • “The net interest margin expansion was achieved by a decrease in deposit costs resulting from repricing initiatives started in the fourth quarter of 2024 and continuing through the first quarter of 2025.” — Rory G. Ritrievi .
  • “We expect that the William Penn merger will close in the middle of the second quarter of 2025.” — Rory G. Ritrievi (subsequently completed April 30) .

Q&A Highlights

  • The Q1 2025 earnings call transcript was not available in company or third-party archives during review; no Q&A content to summarize [ListDocuments returned none].

Estimates Context

  • EPS beat: $0.71 actual vs $0.63 consensus; strong NIM and lower funding costs drove the outperformance; adjusted EPS $0.72 highlights limited non-core headwinds . Values retrieved from S&P Global.
  • Revenue beat modestly vs consensus; Street “Revenue” aligns to total net revenue (NII+noninterest) and was supported by higher NII; noninterest income declined, tempering upside . Values retrieved from S&P Global.
  • Post-quarter estimates likely to reflect NIM tailwinds and integration of William Penn; watch for model updates on NPAs trajectory and deposit mix competitiveness .

Key Takeaways for Investors

  • NIM trajectory is positive with deposit repricing lowering cost of funds; incremental expansion could sustain EPS tailwinds near term if deposit competition remains manageable .
  • Operating discipline continues: efficiency ratio improved to 62.79% and salaries/benefits declined QoQ; supports core earnings durability .
  • Asset quality merits monitoring: NPAs rose to 0.46% of assets on several commercial credits; ACL coverage and minimal net losses mitigate risk but trend warrants vigilance .
  • Balance sheet growth is controlled: loans +4.4% and deposits +3.7% annualized, consistent with “restrained growth” strategy in an inverted curve environment .
  • Capital return intact: dividend maintained and buyback reauthorized with ~$5M capacity; TBV/share rising, bolstered by capital raise and earnings .
  • M&A integration offers regional scale: William Penn adds Greater Philadelphia/Southern NJ presence and lifts consolidated assets to ~$6.3B; execution risk exists but synergy potential is meaningful .
  • Near-term trading lens: focus on NIM prints, deposit cost/mix and NPAs in Q2; integration updates from William Penn can drive sentiment; continued dividend/buyback provides downside support .