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NB Bancorp, Inc. (NBBK)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered record earnings: net income $14.58M and diluted EPS $0.39, up 15% QoQ and 62% YoY, driven by a 21 bps expansion in net interest margin (to 3.82%) and robust loan growth, despite higher credit provisioning .
  • EPS beat Wall Street consensus by $0.04 ($0.39 vs $0.35); coverage remains thin (1 estimate). Revenue consensus was not available; emphasize margin-driven upside and lower effective tax rate (22.1%) from solar credits *.
  • Capital actions remain a catalyst: dividend initiated at $0.07 per share (payable Aug 20) and continued buybacks (1.11M shares at $17.08 average), alongside pending Provident (BankProv) acquisition targeted for Q4 2025 close .
  • Deposits declined 1.4% QoQ as brokered deposits rolled off (-17.8%); core deposits were essentially flat amid the commercial treasury platform conversion (Q2), while FHLB borrowings increased to fund loan growth .

Values marked with * retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • Net interest margin expanded 21 bps QoQ to 3.82%, reflecting lower costs on CDs/IRAs and higher yields on loans and other investments (including FRB stock dividend) .
  • Loan growth continued (+$76.7M, +1.7% QoQ; net loans +$72.4M), with strength in construction/land development (+$77.9M, +12.1%) and C&I (+$15.7M, +2.6%) .
  • Management tone confident with strategic momentum: “delivered record earnings, commenced our second share repurchase program and announced our pending acquisition of Provident … anticipate closing and converting the acquisition in the fourth quarter of 2025” .

What Went Wrong

  • Deposits fell 1.4% QoQ (-$58.6M), driven by brokered deposits (-$55.1M, -17.8%) as maturities were replaced by FHLB funding; core deposits were flat (-$3.5M) .
  • Provision for credit losses rose QoQ to $3.16M (+173% QoQ), with higher loan provision ($4.24M) given longer weighted-average maturities in construction and greater use of national loss-rate proxies .
  • Non-performing loans increased to $12.48M (+9.7% QoQ) due to commercial real estate non-accruals, though net credit performance improved to net recoveries ($19K) aided by a $923K CRE recovery .

Financial Results

Consolidated Results vs Prior Periods

MetricQ2 2024Q1 2025Q2 2025
Total Revenue ($USD Millions)$41.703 $47.387 $51.185
Net Interest Income ($USD Millions)$38.722 $43.526 $47.007
Noninterest Income ($USD Millions)$2.981 $3.861 $4.178
Provision for Credit Losses ($USD Millions)$3.667 $1.158 $3.161
Noninterest Expense ($USD Millions)$26.214 $28.660 $29.305
Pre-tax Income ($USD Millions)$11.822 $17.569 $18.719
Net Income ($USD Millions)$9.453 $12.655 $14.579
Diluted EPS ($USD)$0.24 $0.33 $0.39
Operating Net Income (Non-GAAP, $USD Millions)$9.858 $13.693 $15.043
Operating Diluted EPS (Non-GAAP, $USD)$0.25 $0.35 $0.40
Net Interest Margin (%)3.46% 3.61% 3.82%
Cost of Deposits (%)3.33% 3.11% 3.00%
Efficiency Ratio (%)62.86% 60.48% 57.25%
Effective Tax Rate (%)25.1% (calc)28.0% 22.1%

Estimates vs Actual (Q2 2025)

MetricConsensus EstimateActualSurprise
Diluted EPS ($USD)$0.35*$0.39 +$0.04 (beat)
Total Revenue ($USD Millions)N/A*$51.185 N/A

Values marked with * retrieved from S&P Global.

KPIs and Balance Sheet

KPIQ2 2024Q1 2025Q2 2025
Total Assets ($USD Millions)$4,805.261 $5,242.157 $5,226.554
Total Loans ($USD Millions)$4,097.278 $4,464.500 $4,541.175
Net Loans ($USD Millions)$4,059.421 $4,426.162 $4,498.574
Total Deposits ($USD Millions)$3,917.765 $4,326.617 $4,268.052
Core Deposits ($USD Millions)$3,617.905 $4,017.378 $4,013.892
Brokered Deposits ($USD Millions)$299.860 $309.239 $254.160
FHLB Borrowings ($USD Millions)$60.835 $90.835 $127.600
Shareholders’ Equity ($USD Millions)$744.462 $739.611 $737.122
Book Value per Share ($USD)$17.43 $18.23 $18.09
Tangible Book Value per Share ($USD)$17.41 $18.20 $18.06
ACL ($USD Millions)$37.857 $38.338 $42.601
NPLs / Total Loans (%)0.51% 0.25% 0.27%
Net (Charge-offs)/Recoveries (Annualized, %)(0.09)% (0.12)% 0.00%

Commercial Real Estate Portfolio (Collateral Type, Q2 2025)

Collateral TypeBalance ($USD Millions)Mix (%)
Multi-Family$316.745 19%
Cannabis Facility$270.855 16%
Industrial$202.021 12%
Office$191.956 12%
Hospitality$172.159 10%
Mixed-Use$168.021 10%
Special Purpose$135.097 8%
Retail$126.397 7%
Other$106.899 6%
Total CRE$1,690.150 100%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Quarterly Dividend per ShareQ3 2025 pay date Aug 20, 2025None$0.07 per shareInitiated
Provident (BankProv) Acquisition Close/Conversion TimingQ4 2025 (expected)Not provided (newly announced Jun 5, 2025)Close and convert in Q4 2025 (management expectation)New timeline
Formal Revenue/Margin/OpEx Guidance2025NoneNoneMaintained: no formal guidance

Earnings Call Themes & Trends

Note: A Q2 2025 earnings call transcript was not located on the company’s IR site or common aggregators; themes below infer from Q2 press release and prior quarter releases .

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Net Interest Margin3.52% in Q4; expanded 9 bps to 3.61% in Q1 on lower liability costs Expanded 21 bps to 3.82% on lower deposit rates and higher loan balances/other yields Improving
Deposits/Core vs BrokeredQ4 core +4.2%, brokered -6.0%; Q1 core +3.9% Total deposits -1.4% QoQ as brokered -17.8%; core essentially flat amid Q2 platform conversion Mixed (core stable; funding mix shifting)
Loan Growth MixQ4 CRE +9.3%; Q1 construction +10.7%, C&I +8.9% Q2 construction +12.1%; C&I +2.6%; multi-family -7.3%; mixed-use +36% Selective growth; rebalancing
Credit Provisioning/ACLQ4 provision $1.4M; Q1 $1.2M; ACL ~0.86–0.89% Q2 provision $3.16M; ACL 0.94% (longer maturities in construction, national loss-rate proxies) Tightening reserves
Asset QualityQ4 NPLs 0.32% of loans; Q1 0.25% Q2 0.27%; net recoveries aided by $923K CRE recovery Stable-to-slightly weaker NPLs; improved net losses
Capital ActionsQ4: initiated repurchase program (5% of shares) ; Q1: repurchased 2.14M shares Q2: repurchased 1.11M shares (avg $17.08); dividend initiated Shareholder-friendly
Technology/Commercial TreasuryNot discussed in Q4; limited mention in Q1Conversion to Q2 cash management platform for commercial customers Execution milestone
Tax Rate/Solar CreditsQ4 effective 19.0% (benefit); Q1 28.0% (no benefit) Q2 22.1% (solar tax credit investments) Beneficial credits recurring

Management Commentary

  • “Our second quarter was an exciting period for our entire team as we delivered record earnings, commenced our second share repurchase program and announced our pending acquisition of Provident. We are focused on continued execution of our growth strategy and anticipate closing and converting the acquisition in the fourth quarter of 2025.” — Joseph Campanelli, Chairman, President & CEO .
  • “Net interest margin expanded by 21 basis points to 3.82% … We also repurchased over 1.1 million shares … at an average per share price of $17.08, providing accretive value to our shareholders.” — Campanelli .

Q&A Highlights

  • A Q2 2025 earnings call transcript was not found on the company’s investor relations site or typical transcript aggregators; no Q&A disclosures were available to review .

Estimates Context

  • EPS beat: Q2 2025 diluted EPS $0.39 vs S&P Global consensus $0.35; coverage is limited (Primary EPS – # of Estimates = 1), which can amplify surprises and post-print revisions *.
  • Revenue: No S&P Global quarterly revenue consensus was available; actual “total revenue” (net interest income plus noninterest income) was $51.19M *.
  • Implication: Expect upward estimate revisions to reflect strong NIM expansion, lower effective tax rate, and noninterest income uplift (swap and branding bonus), partially offset by higher credit provisioning and deposit mix shifts .

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Margin tailwind: 21 bps NIM expansion to 3.82% drove EPS upside; further benefit depends on liability repricing and asset yields holding amid loan growth .
  • Funding mix transition: Brokered runoff and higher FHLB borrowings funded loans; watch core deposit growth post-Q2 platform conversion and the cost of funds trajectory .
  • Credit normalization: Elevated loan loss provision (construction maturities and proxy loss rates) increased ACL to 0.94%; asset quality remains solid with net recoveries and modest NPL uptick .
  • Capital deployment: Dividend initiation ($0.07) and continued buybacks (1.11M shares at $17.08) enhance shareholder returns; track regulatory/process milestones for the Provident/BankProv acquisition in Q4 2025 .
  • Non-GAAP clarity: Q2 had $530K M&A costs and $64K BOLI-related tax/penalty; operating EPS $0.40 offers a cleaner view of core earnings power .
  • Narrative that moves the stock: Sustained NIM improvement + disciplined credit management + capital returns + M&A synergy potential are key catalysts; deposit dynamics and provisioning cadence are the main swing factors near term .
  • Medium-term thesis: Integration of BankProv, treasury platform upgrades, and CRE portfolio rebalancing support earnings resilience; monitor office/cannabis exposures and construction maturities as macro conditions evolve .