QUARTERLY HIGHLIGHTS

  • Net income was a record $37.52 million for the quarter, up $6.08 million or 19.35% from the previous quarter and up $8.07 million or 38% from the first quarter of 2024. Diluted net income per common share was $1.52, up $0.25 or 19.69% from the previous quarter and up $0.33 or 27.73% from the prior year’s first quarter of $1.19.
  • Return on average assets increased to 1.72% from 1.42% in the previous quarter and 1.37% in the first quarter of 2024. Return on average common shareholders’ equity increased to 13.33% from 11.21%, in the previous quarter and 11.77% in the first quarter of 2024.
  • Cash dividend of $0.38 per common share for the quarter was approved, up 11.76% from the cash dividend declared a year ago.
  • Average loans and leases grew $122.53 million in the first quarter, up 1.84% (7.36% annualized growth) from the previous quarter and increased $294.88 million, up 4.53% from the first quarter of 2024.
  • Average deposits increased $187.39 million in the first quarter, up 2.62% (10.48% annualized growth) from the previous quarter and grew $322.44 million, up 4.60% from the first quarter of 2024.
  • Tax-equivalent net interest income was $81.09 million, up $1.57 million or 1.97% from the fourth quarter of 2024 and up $9.02 million, or 12.52% from the first quarter a year ago. Tax-equivalent net interest margin was 3.90%, up 12 basis points from the previous quarter and up 36 basis points from the first quarter a year ago.
  • During the first quarter, we received a one-time $0.74 million after-tax interest payment on federal tax refunds from tax credit carrybacks. This was recognized through income tax expense and lowered the effective tax rate to 21.34% from 21.53% during the previous quarter and 22.24% from the first quarter a year ago.

South Bend, IN – 1st Source Corporation (NASDAQ: SRCE), parent company of 1st Source Bank, today reported record quarterly net income of $37.52 million for the first quarter of 2025, up 19.35% compared to $31.44 million the previous quarter and up 27.38% from the $29.46 million reported in the first quarter a year ago. Diluted net income per common share for the first quarter of 2025 was $1.52, up 19.69% compared to $1.27 in the previous quarter and up 27.73%, versus $1.19 in the first quarter of 2024. Return on average assets increased to 1.72% and return on average shareholders’ equity increased to 13.33% during the first quarter from 1.42% and 11.21%, respectively, in the previous quarter.

At its April 2025 meeting, the Board of Directors approved a cash dividend of $0.38 per common share, up 11.76% from the cash dividend declared a year ago. The cash dividend is payable to shareholders of record on May 5, 2025, and will be paid on May 15, 2025.

Christopher J. Murphy III, Chairman and Chief Executive Officer, commented, “In spite of the noise in the economy and the uncertainty in the market, we are pleased to have achieved record quarterly net income during the quarter and net interest margin expansion compared to the previous quarter. Higher rates on investment securities, increased average loan and lease balances, and less reliance on higher costing short-term borrowings lead to a 12-basis point improvement of our margin from the prior quarter. This marks the fifth consecutive quarter of margin expansion despite persistent deposit rate competition. Most importantly, our balance sheet remained strong during the quarter and is well positioned to handle economic uncertainty, which seems to be increasing every day, adversely impacting our customers and their businesses. Our liquidity position is solid and our historically conservative capital position was maintained.

“During the first quarter of 2025 we were very happy to learn that 1st Source Bank won several local and national accolades. For the second consecutive year, we were included in Forbes’ America’s Best Banks list and came in at #26 out of the top 100 named. This award is driven by 10 metrics addressing growth, credit quality and profitability – a set of proof points that we are continuing to maintain a strong and stable balance sheet, sustainable earnings, and are staying true to our mission of helping our clients achieve security, build wealth, and realize their dreams.

“Additionally, for the fourth consecutive year, we were named to Forbes’ America’s Best Midsize Employers list. We are especially proud of this award because the list identifies companies that are rated most highly by their employees. They ranked the employers on everything from salary, work environment, training programs, and opportunities to advance. It is confirmation that our leadership team is upholding our culture built on core values of integrity, teamwork, superior quality, outstanding client service, and community leadership.

“In March, we were also pleased to learn that we were designated by S&P Global Market Intelligence’s unit as among the Top 50 Community Banks with $3B to $10B in assets for the second year in a row, coming in at #25. This is a testament to our commitment to making smart financial decisions for the long term.

“At the state and local levels, we were recognized for our small business lending across the state of Indiana for the 12th consecutive year by the U.S. Small Business Administration (SBA). 1st Source once again received the Community Bank Gold Level Award for delivering the greatest number of SBA loans in Indiana in 2024. We were also proud to learn that we won five awards in Northwest Indiana Business Magazine’s Best of Business awards in the Banking and Finance category. The awards won included Best Bank for Business, Best Bank for Customer Service, Best Business Investment Firm, Best Institution for Obtaining a Business Loan, and Best Wealth Management Advisory Firm – all in Michiana.

“And finally, in the first quarter, our Kouts and Portage Avenue Banking Centers underwent renovations and were converted to our side-by-side banking model. Our Winamac Banking Center was moved to a new location and now also showcases the side-by-side model. This experience invites clients behind the teller line, allowing for the Bank’s clients and bankers to have a more transparent and inclusive relationship. We are also excited to have opened a new banking center in Carmel, Indiana in early April. This new location complements our existing loan production office in the Greater Indianapolis market, and we are eager to be able to serve both personal and business clients in that area with our full suite of services,” Mr. Murphy concluded.

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