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NB Bancorp, Inc. (NBBK)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered disciplined balance-sheet growth and NIM expansion, but GAAP EPS fell sequentially on higher operating expense and tax; diluted EPS was $0.33 vs $0.40 in Q4 2024 and $0.22 in Q1 2024, while operating diluted EPS was $0.35 .
  • Net interest margin expanded 9 bps to 3.61% as deposit costs declined; total revenue rose to $47.4M from $46.3M in Q4 and $42.1M YoY .
  • Deposits grew $149.0M (+3.6%) and loans grew $131.3M (+3.0%); loan-to-deposit ratio eased to 102.3%, strengthening liquidity .
  • The company completed a 5% share repurchase (2,135,286 shares at $19.06), reducing equity QoQ, and highlighted continued market share growth ambitions .
  • Asset quality improved: NPLs fell to $11.4M (0.25% of loans) and ACL coverage of NPLs rose to 337%; net charge-offs increased to 0.12% annualized due to higher purchased consumer loan charge-offs .

What Went Well and What Went Wrong

What Went Well

  • Net interest margin expanded to 3.61% (+9 bps QoQ) as interest-bearing liabilities repriced lower while asset yields remained flat, supporting revenue growth .
  • Core deposits increased $149.5M (+3.9%) with notable strength in money market (+$127.1M, +12.7%), bolstering liquidity and enabling paydown of $30.0M FHLB borrowings .
  • Management resolved a large CRE non-accrual, reducing NPLs to $11.4M and lifting ACL/NPL coverage to 337%; CEO emphasized “disciplined” growth and shareholder value creation: “We look forward to continuing to grow market share… prudently manage shareholders’ equity” .

What Went Wrong

  • GAAP diluted EPS declined sequentially to $0.33 due to higher noninterest expense (final pension termination expense of $1.2M pre-tax) and a higher effective tax rate (28% vs 19% prior quarter) .
  • Efficiency ratio worsened to 60.48% (from 55.34%), reflecting expense growth outpacing revenue; swap income fell sharply (-83% QoQ) amid reduced demand .
  • Net charge-offs rose to 0.12% annualized (from 0.04%) driven by purchased consumer loan charge-offs; tangible equity ratio dipped to 14.09% on buybacks despite TBVPS rising to $18.20 .

Financial Results

MetricQ1 2024Q4 2024Q1 2025
Total Revenue ($USD Thousands)$42,134 $46,302 $47,387
Net Interest Income ($USD Thousands)$38,633 $42,521 $43,526
Noninterest Income ($USD Thousands)$3,501 $3,781 $3,861
Noninterest Expense ($USD Thousands)$25,565 $25,623 $28,660
Pre-tax Income ($USD Thousands)$12,140 $19,275 $17,569
Net Income ($USD Thousands)$8,701 $15,611 $12,655
Diluted EPS (GAAP)$0.22 $0.40 $0.33
Operating Diluted EPS (Non-GAAP)$0.23 $0.34 $0.35
Net Interest Margin (%)3.62% 3.52% 3.61%
Efficiency Ratio (%)60.68% 55.34% 60.48%
Cost of Deposits (%)3.17% 3.24% 3.11%

Estimate Comparison (S&P Global)

MetricConsensusActualSurprise
Primary EPS (Q1 2025)$0.35*$0.35*In line*
Revenue (Q1 2025)N/A*$46.229M*N/A*

Values retrieved from S&P Global.*

KPIs and Balance Sheet

KPIQ1 2024Q4 2024Q1 2025
Total Assets ($USD Thousands)$4,649,826 $5,157,737 $5,242,157
Total Loans ($USD Thousands)$3,954,623 $4,333,152 $4,464,500
Total Deposits ($USD Thousands)$3,771,860 $4,177,652 $4,326,617
Core Deposits ($USD Thousands)$3,472,054 $3,867,846 $4,017,378
Brokered Deposits ($USD Thousands)$299,806 $309,806 $309,239
FHLB Borrowings ($USD Thousands)$60,837 $120,835 $90,835
Loan-to-Deposit Ratio (%)——102.3%
Tangible Book Value per Share ($)$17.16 $17.89 $18.20
Share Repurchases—Program authorized (5%) 2,135,286 shares at $19.06
Effective Tax Rate (%)28.3% (operating) 19.0% (GAAP) 28.0% (GAAP)
NPLs ($USD Thousands)$11,064 $13,856 $11,372
NPLs / Loans (%)0.28% 0.32% 0.25%
ACL ($USD Thousands)$34,306 $38,744 $38,338
ACL / Loans (%)0.87% 0.89% 0.86%
ACL / NPLs (%)310.1% 279.6% 337.1%
Net Charge-offs (Annualized) / Avg Loans (%)0.19% 0.04% 0.12%

CRE Portfolio Breakdown (Balances)

Collateral TypeMar 31 2024Dec 31 2024Mar 31 2025
Multi-Family ($000, %)$321,124; 21% $333,047; 20% $341,619; 20%
Cannabis Facility ($000, %)$266,904; 17% $326,030; 19% $322,678; 19%
Industrial ($000, %)$161,865; 11% $197,248; 12% $198,013; 11%
Office ($000, %)$191,153; 12% $182,804; 11% $186,855; 11%
Hospitality ($000, %)$148,307; 10% $164,520; 10% $172,285; 10%
Special Purpose ($000, %)$134,392; 9% $132,085; 8% $130,573; 8%
Retail ($000, %)$131,133; 9% $137,597; 8% $134,891; 8%
Mixed-Use ($000, %)$71,147; 5% $112,771; 6% $119,433; 7%
Other ($000, %)$90,489; 6% $110,339; 6% $111,252; 6%
Total CRE ($000)$1,516,514 $1,696,441 $1,717,599

Guidance Changes

No formal quantitative guidance ranges (revenue, EPS, margins, OpEx, tax rate, segment) were provided for Q1 2025; management emphasized disciplined growth, liquidity, and capital management, including continued market share pursuit and shareholder value focus .

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue/EPS/MarginsFY/Q2+NoneNoneMaintained: No formal guidance
Tax RateFYNot provided28% effective tax rate reported for Q1Informational, not guidance
Capital Actions2025Repurchase program authorized (Jan 22, 2025)Executed 5% buyback in Q1Implemented
DividendsFYNot disclosedNot disclosedN/A

Earnings Call Themes & Trends

Earnings call transcript not available for Q1 2025; themes below reflect disclosures in company press releases.

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Net Interest MarginNIM +5 bps to 3.51% on asset yields and deposit mix NIM +1 bp to 3.52% NIM +9 bps to 3.61% on lower deposit costs Improving
Deposits/LiquidityDeposits +3.2%; brokered up 10%; L/D ~103% implied Deposits +3.3%; core strength; cash up Deposits +3.6%; L/D down to 102.3%; FHLB down $30M Strengthening core
Capital/BuybacksNo buyback; TBVPS $17.48 Buyback program authorized; TBVPS $17.89 5% repurchased; TBVPS $18.20 Accretive TBVPS
Asset QualityNPLs fell to $16.0M; office loan charge-off NPLs $13.9M; ACL 0.89%; net COs 0.04% NPLs $11.4M; ACL/NPL 337%; net COs 0.12% Improving NPLs; higher COs
Tax/PAM/BOLIPAM adoption drove higher ETR; BOLI restructure ETR 19% with PAM benefit ETR 28% (no PAM benefit) Normalizing higher
CRE ExposureCannabis up QoQ; office charge-off CRE up; cannabis modestly up CRE up modestly; cannabis down QoQ Mixed shift

Management Commentary

  • “Deposits grew by $149.0 million, or 3.6%, while net loans grew by $131.8 million, or 3.1%… Net interest margin expanded by nine basis points to 3.61%…” — Joseph Campanelli, Chairman, President & CEO .
  • “We repurchased 5% of outstanding shares during the quarter at an all-in weighted average cost of $19.06 per share… loan-to-deposit ratio decreased to 102.3%…” .
  • “We look forward to continuing to grow market share and successfully and prudently manage shareholders' equity to continue to increase shareholder value” .

Q&A Highlights

Earnings call transcript for Q1 2025 was not available; no Q&A themes or clarifications could be extracted from company call materials [functions.ListDocuments result: none].

Estimates Context

  • EPS: S&P Global consensus for Primary EPS was $0.35, and S&P records the actual Primary EPS as $0.35; this aligns with operating diluted EPS, while GAAP diluted EPS was $0.33 (sequential decline on pension termination expense and higher tax rate)* .
  • Revenue: S&P showed no consensus revenue estimate; company-reported total revenue was $47.4M. S&P reported revenue actual at $46.229M reflecting different definitions; hence comparison to estimates is not applicable* .

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • NIM expansion and deposit growth underpin revenue momentum; sequential NIM +9 bps with deposit cost decline (3.11%) is a key driver for near-term NII resilience .
  • GAAP EPS pressure in Q1 reflects nonrecurring pension expense and a higher effective tax rate; operating EPS ($0.35) better represents underlying run-rate heading into Q2 .
  • Liquidity and funding improved: loan-to-deposit ratio down to 102.3%, FHLB borrowings reduced $30M; expect continued self-funding of loan growth to support margin stability .
  • Asset quality narrative improved with NPLs down 18% QoQ and ACL/NPL coverage rising, though elevated consumer charge-offs suggest monitoring retail credit performance .
  • Share repurchases are accretive to TBVPS ($18.20) and create EPS leverage; equity declined QoQ from buybacks, which may keep capital ratios in focus .
  • CRE mix remains diversified; cannabis exposure ticked down QoQ and office remains suburban A/B medical/traditional, mitigating large urban tower risk .
  • Near-term trading: favor on NIM trajectory and deposit growth; watch updates on expense discipline, charge-off trends, and any regulatory or legal headlines (shareholder investigation press release on May 14) .