Alerus Financial Corporation Reports Fourth Quarter 2024 Net Income of $3.2 Million
CEO Comments
President and Chief Executive Officer Katie Lorenson said, “We are pleased to end 2024 with a solid quarter on across-the-board improvements to our performance metrics. The fourth quarter of 2024 was highlighted by the closing and conversion of HMN Financial, Inc. (“HMNF”), the largest acquisition in our Company history, and we welcome HMNF’s employees to the Alerus team. The combination of HMNF and meaningful organic growth in our underlying core business, drove an increase in earnings per share by a robust
For the full year 2024, we achieved market share gains and strong client base growth across all our business lines with our noninterest income, which represents nearly half of our total revenues. Noninterest income grew
We enter 2025 with positive momentum and plan to continue making long term investments to support and grow our diversified revenue streams while continuing to prudently manage our expenses. While our capital ratios declined in the fourth quarter due to the HMNF acquisition, we remain above all well-capitalized thresholds and expect to build capital in 2025. We bolstered our reserves with the allowance for credit losses on loans to total loans moving up to
Looking ahead, we remain committed to driving sustainable growth and delivering value to our shareholders. Our strategic focus on organic growth, diversification, valuable fee income, and maintaining strong asset quality will continue to guide our efforts in 2025 and beyond.
I want to thank all our team members - both the new team from HMNF and the long tenured legacy team - for your hard work, dedication and invaluable contributions supporting our company, our clients and our communities in 2024. Together, we will continue to build on our successes and return Alerus to top tier financial results.”
Fourth Quarter Highlights
-
Adjusted earnings per common share (non-GAAP) of
in the fourth quarter of 2024, an increase of$0.44 41.9% from in the third quarter of 2024.$0.31 - Completed the acquisition of HMN Financial, Inc. and its subsidiary, Home Federal Savings Bank (together, “HMNF”) in the fourth quarter of 2024, the 26th and largest acquisition in the Company’s history.
-
Total loans were
as of December 31, 2024, an increase of$4.0 billion , or$1.0 billion 31.7% , from September 30, 2024. -
Total deposits were
as of December 31, 2024, an increase of$4.4 billion , or$1.1 billion 31.7% , from September 30, 2024. -
Non-interest bearing deposits were
as of December 31, 2024, an increase of$903.5 million , or$245.9 million 37.4% , from September 30, 2024. -
The loan to deposit ratio remained stable at
91.2% as of both December 31, 2024 and September 30, 2024. -
Net interest income was
in the fourth quarter of 2024, an increase of$38.3 million 69.8% from in the third quarter of 2024.$22.5 million -
Net interest margin was
3.20% in the fourth quarter of 2024, an increase of 97 basis points from2.23% in the third quarter of 2024. -
Noninterest income was
in the fourth quarter of 2024, which represented$33.9 million 46.9% of total revenues, an increase of19.4% from in the third quarter of 2024.$28.4 million -
Adjusted pre-provision net revenue was
in the fourth quarter of 2024, an increase of$18.2 million 88.6% from in the third quarter of 2024.$9.7 million -
Adjusted efficiency ratio (non-GAAP) was
69.0% in the fourth quarter of 2024, improved from77.7% in the third quarter of 2024. -
Allowance for credit losses on loans to total loans was
1.50% as of December 31, 2024, an increase of 21 basis points from1.29% as of September 30, 2024. -
Adjusted return on average tangible common equity (non-GAAP) was
14.7% in the fourth quarter of 2024, an increase from9.0% in the third quarter of 2024. -
Book value per common share was
as of December 31, 2024, a$19.68 0.8% increase from as of September 30, 2024.$19.53
Full Year 2024 Highlights
-
Adjusted earnings per common share (non-GAAP) of
for the year ended December 31, 2024, a decrease of$1.44 0.7% from for the year ended December 31, 2023.$1.45 -
Total loans were
as of December 31, 2024, an increase of$4.0 billion , or$1.2 billion 44.7% , from December 31, 2023. -
Total deposits were
as of December 31, 2024, an increase of$4.4 billion , or$1.3 billion 41.4% , from December 31, 2023. -
Non-interest bearing deposits were
as of December 31, 2024, an increase of$903.5 million , or$175.4 million 24.1% , from December 31, 2023. -
Net interest income was
for the year ended December 31, 2024, an increase of$107.0 million 21.9% from for the year ended December 31, 2023.$87.8 million -
Net interest margin was
2.56% for the year ended December 31, 2024, an increase of 10 basis points from2.46% for the year ended December 31, 2023. -
Noninterest income was
for the year ended December 31, 2024, which represented$114.9 million 51.8% of total revenues, an increase of43.3% from for the year ended December 31, 2023.$80.2 million -
Total assets under administration/management at December 31, 2024 were
, an$45.3 billion 11.3% increase from December 31, 2023. -
Adjusted pre-provision net revenue was
for the year ended December 31, 2024, an increase of$50.2 24.3% from for the year ended December 31, 2023.$40.4 million -
Adjusted efficiency ratio (non-GAAP) was
73.4% for the year ended December 31, 2024, improved from75.5% for the year ended December 31, 2023. -
Allowance for credit losses on loans to total loans was
1.50% as of December 31, 2024, an increase of 20 basis points from1.30% as of December 31, 2023. -
Book value per common share was
as of December 31, 2024, a$19.68 5.2% increase from as of December 31, 2023.$18.71 -
Dividends paid per common share totaled
for the year ended December 31, 2024, an increase of$0.79 5.3% from for the year ended December 31, 2023.$0.75
Selected Financial Data (unaudited)
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As of and for the |
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Three months ended |
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Year ended |
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December 31, |
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September 30, |
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December 31, |
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December 31, |
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December 31, |
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(dollars and shares in thousands, except per share data) |
|
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||
Performance Ratios |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average total assets |
|
|
0.24 |
% |
|
|
0.48 |
% |
|
|
(1.51 |
)% |
|
|
0.47 |
% |
|
|
0.31 |
% |
Adjusted return on average total assets(1) |
|
|
0.83 |
% |
|
|
0.57 |
% |
|
|
0.52 |
% |
|
|
0.68 |
% |
|
|
0.77 |
% |
Return on average common equity |
|
|
2.68 |
% |
|
|
5.52 |
% |
|
|
(16.75 |
)% |
|
|
5.30 |
% |
|
|
3.26 |
% |
Return on average tangible common equity(1) |
|
|
6.01 |
% |
|
|
7.83 |
% |
|
|
(18.85 |
)% |
|
|
8.16 |
% |
|
|
5.37 |
% |
Adjusted return on average tangible common equity(1) |
|
|
14.65 |
% |
|
|
9.04 |
% |
|
|
8.38 |
% |
|
|
11.15 |
% |
|
|
11.30 |
% |
Noninterest income as a % of revenue |
|
|
46.94 |
% |
|
|
55.72 |
% |
|
|
3.54 |
% |
|
|
51.78 |
% |
|
|
47.74 |
% |
Net interest margin (tax-equivalent) |
|
|
3.20 |
% |
|
|
2.23 |
% |
|
|
2.37 |
% |
|
|
2.56 |
% |
|
|
2.46 |
% |
Adjusted net interest margin (tax-equivalent)(1) |
|
|
2.81 |
% |
|
|
2.35 |
% |
|
|
2.31 |
% |
|
|
2.53 |
% |
|
|
2.42 |
% |
Efficiency ratio(1) |
|
|
73.36 |
% |
|
|
80.29 |
% |
|
|
165.40 |
% |
|
|
75.93 |
% |
|
|
85.85 |
% |
Adjusted efficiency ratio(1) |
|
|
68.97 |
% |
|
|
77.71 |
% |
|
|
78.18 |
% |
|
|
73.44 |
% |
|
|
75.50 |
% |
Net charge-offs/(recoveries) to average loans |
|
|
0.13 |
% |
|
|
0.04 |
% |
|
|
(0.04 |
)% |
|
|
0.13 |
% |
|
|
(0.04 |
)% |
Dividend payout ratio |
|
|
153.85 |
% |
|
|
76.92 |
% |
|
|
(26.03 |
)% |
|
|
80.61 |
% |
|
|
129.31 |
% |
Per Common Share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share - basic |
|
$ |
0.13 |
|
|
$ |
0.26 |
|
|
$ |
(0.73 |
) |
|
$ |
1.00 |
|
|
$ |
0.59 |
|
Earnings per common share - diluted |
|
$ |
0.13 |
|
|
$ |
0.26 |
|
|
$ |
(0.73 |
) |
|
$ |
0.98 |
|
|
$ |
0.58 |
|
Adjusted earnings per common share - diluted (1) |
|
$ |
0.44 |
|
|
$ |
0.31 |
|
|
$ |
0.26 |
|
|
$ |
1.44 |
|
|
$ |
1.45 |
|
Dividends declared per common share |
|
$ |
0.20 |
|
|
$ |
0.20 |
|
|
$ |
0.19 |
|
|
$ |
0.79 |
|
|
$ |
0.75 |
|
Book value per common share |
|
$ |
19.68 |
|
|
$ |
19.53 |
|
|
$ |
18.71 |
|
|
|
|
|
|
|
|
|
Tangible book value per common share (1) |
|
$ |
14.49 |
|
|
$ |
16.50 |
|
|
$ |
15.46 |
|
|
|
|
|
|
|
|
|
Average common shares outstanding - basic |
|
|
24,857 |
|
|
|
19,788 |
|
|
|
19,761 |
|
|
|
21,047 |
|
|
|
19,922 |
|
Average common shares outstanding - diluted |
|
|
25,144 |
|
|
|
20,075 |
|
|
|
19,996 |
|
|
|
21,321 |
|
|
|
20,143 |
|
Other Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retirement and benefit services assets under administration/management |
|
$ |
40,728,699 |
|
|
$ |
41,249,280 |
|
|
$ |
36,682,425 |
|
|
|
|
|
|
|
|
|
Wealth management assets under administration/management |
|
$ |
4,579,189 |
|
|
$ |
4,397,505 |
|
|
$ |
4,018,846 |
|
|
|
|
|
|
|
|
|
Mortgage originations |
|
$ |
88,576 |
|
|
$ |
82,388 |
|
|
$ |
65,488 |
|
|
$ |
334,318 |
|
|
$ |
364,114 |
|
____________________ (1) Represents a non-GAAP financial measure. See “Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures.” |
Results of Operations
Net Interest Income
Net interest income for the fourth quarter of 2024 was
Net interest income increased
Net interest margin (on a tax-equivalent basis) was
Noninterest Income
Noninterest income for the fourth quarter of 2024 was
Noninterest income for the fourth quarter of 2024 increased by
Noninterest Expense
Noninterest expense for the fourth quarter of 2024 was
Noninterest expense for the fourth quarter of 2024 increased
Financial Condition
Total assets were
Loans
Total loans were
The following table presents the composition of our loan portfolio as of the dates indicated:
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
(dollars in thousands) |
|
2024 |
|
|
2024 |
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|||||
Commercial |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
|
$ |
666,727 |
|
|
$ |
606,245 |
|
|
$ |
591,779 |
|
|
$ |
575,259 |
|
|
$ |
562,180 |
|
Commercial real estate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction, land and development |
|
|
294,677 |
|
|
|
173,629 |
|
|
|
161,751 |
|
|
|
125,966 |
|
|
|
124,034 |
|
Multifamily |
|
|
363,123 |
|
|
|
275,377 |
|
|
|
242,041 |
|
|
|
260,609 |
|
|
|
245,103 |
|
Non-owner occupied |
|
|
967,025 |
|
|
|
686,071 |
|
|
|
647,776 |
|
|
|
565,979 |
|
|
|
569,354 |
|
Owner occupied |
|
|
371,418 |
|
|
|
296,366 |
|
|
|
283,356 |
|
|
|
285,211 |
|
|
|
271,623 |
|
Total commercial real estate |
|
|
1,996,243 |
|
|
|
1,431,443 |
|
|
|
1,334,924 |
|
|
|
1,237,765 |
|
|
|
1,210,114 |
|
Agricultural |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land |
|
|
61,299 |
|
|
|
45,821 |
|
|
|
41,410 |
|
|
|
41,149 |
|
|
|
40,832 |
|
Production |
|
|
63,008 |
|
|
|
39,436 |
|
|
|
40,549 |
|
|
|
36,436 |
|
|
|
36,141 |
|
Total agricultural |
|
|
124,307 |
|
|
|
85,257 |
|
|
|
81,959 |
|
|
|
77,585 |
|
|
|
76,973 |
|
Total commercial |
|
|
2,787,277 |
|
|
|
2,122,945 |
|
|
|
2,008,662 |
|
|
|
1,890,609 |
|
|
|
1,849,267 |
|
Consumer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential real estate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First lien |
|
|
921,019 |
|
|
|
690,451 |
|
|
|
686,286 |
|
|
|
703,726 |
|
|
|
697,900 |
|
Construction |
|
|
33,547 |
|
|
|
11,808 |
|
|
|
22,573 |
|
|
|
18,425 |
|
|
|
28,979 |
|
HELOC |
|
|
162,509 |
|
|
|
134,301 |
|
|
|
126,211 |
|
|
|
120,501 |
|
|
|
118,315 |
|
Junior lien |
|
|
44,060 |
|
|
|
36,445 |
|
|
|
36,323 |
|
|
|
36,381 |
|
|
|
35,819 |
|
Total residential real estate |
|
|
1,161,135 |
|
|
|
873,005 |
|
|
|
871,393 |
|
|
|
879,033 |
|
|
|
881,013 |
|
Other consumer |
|
|
44,122 |
|
|
|
36,393 |
|
|
|
35,737 |
|
|
|
29,833 |
|
|
|
29,303 |
|
Total consumer |
|
|
1,205,257 |
|
|
|
909,398 |
|
|
|
907,130 |
|
|
|
908,866 |
|
|
|
910,316 |
|
Total loans |
|
$ |
3,992,534 |
|
|
$ |
3,032,343 |
|
|
$ |
2,915,792 |
|
|
$ |
2,799,475 |
|
|
$ |
2,759,583 |
|
Deposits
Total deposits were
The following table presents the composition of the Company’s deposit portfolio as of the dates indicated:
|
|
December 31, |
|
|
September 30, |
|
|
June 30, |
|
|
March 31, |
|
|
December 31, |
|
|||||
(dollars in thousands) |
|
2024 |
|
|
2024 |
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|||||
Noninterest-bearing demand |
|
$ |
903,466 |
|
|
$ |
657,547 |
|
|
$ |
701,428 |
|
|
$ |
692,500 |
|
|
$ |
728,082 |
|
Interest-bearing |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand |
|
|
1,220,173 |
|
|
|
1,034,694 |
|
|
|
1,003,585 |
|
|
|
938,751 |
|
|
|
840,711 |
|
Savings accounts |
|
|
165,882 |
|
|
|
75,675 |
|
|
|
79,747 |
|
|
|
82,727 |
|
|
|
82,485 |
|
Money market savings |
|
|
1,381,924 |
|
|
|
1,067,187 |
|
|
|
1,022,470 |
|
|
|
1,114,262 |
|
|
|
1,032,771 |
|
Time deposits |
|
|
706,965 |
|
|
|
488,447 |
|
|
|
491,345 |
|
|
|
456,729 |
|
|
|
411,562 |
|
Total interest-bearing |
|
|
3,474,944 |
|
|
|
2,666,003 |
|
|
|
2,597,147 |
|
|
|
2,592,469 |
|
|
|
2,367,529 |
|
Total deposits |
|
$ |
4,378,410 |
|
|
$ |
3,323,550 |
|
|
$ |
3,298,575 |
|
|
$ |
3,284,969 |
|
|
$ |
3,095,611 |
|
Asset Quality
Total nonperforming assets were
As of December 31, 2024, the allowance for credit losses on loans was
The following table presents selected asset quality data as of and for the periods indicated:
|
|
As of and for the three months ended |
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|
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
||||||||||
(dollars in thousands) |
|
2024 |
|
2024 |
|
2024 |
|
2024 |
|
2023 |
||||||||||
Nonaccrual loans |
|
$ |
54,433 |
|
|
$ |
48,026 |
|
|
$ |
27,618 |
|
|
$ |
7,345 |
|
|
$ |
8,596 |
|
Accruing loans 90+ days past due |
|
|
8,453 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
139 |
|
Total nonperforming loans |
|
|
62,886 |
|
|
|
48,026 |
|
|
|
27,618 |
|
|
|
7,345 |
|
|
|
8,735 |
|
OREO and repossessed assets |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3 |
|
|
|
32 |
|
Total nonperforming assets |
|
$ |
62,886 |
|
|
$ |
48,026 |
|
|
$ |
27,618 |
|
|
$ |
7,348 |
|
|
$ |
8,767 |
|
Net charge-offs/(recoveries) |
|
|
1,258 |
|
|
|
316 |
|
|
|
2,522 |
|
|
|
58 |
|
|
|
(238 |
) |
Net charge-offs/(recoveries) to average loans |
|
|
0.13 |
% |
|
|
0.04 |
% |
|
|
0.36 |
% |
|
|
0.01 |
% |
|
|
(0.04 |
)% |
Nonperforming loans to total loans |
|
|
1.58 |
% |
|
|
1.58 |
% |
|
|
0.95 |
% |
|
|
0.26 |
% |
|
|
0.32 |
% |
Nonperforming assets to total assets |
|
|
1.19 |
% |
|
|
1.18 |
% |
|
|
0.63 |
% |
|
|
0.17 |
% |
|
|
0.22 |
% |
Allowance for credit losses on loans to total loans |
|
|
1.50 |
% |
|
|
1.29 |
% |
|
|
1.31 |
% |
|
|
1.31 |
% |
|
|
1.30 |
% |
Allowance for credit losses on loans to nonperforming loans |
|
|
95 |
% |
|
|
82 |
% |
|
|
139 |
% |
|
|
498 |
% |
|
|
410 |
% |
For the fourth quarter of 2024, the Company had net charge-offs of
The Company recorded a provision for credit losses of
The unearned fair value adjustments on acquired loan portfolios were
Capital
Total stockholders’ equity was
The following table presents our capital ratios as of the dates indicated:
|
|
December 31, |
|
September 30, |
|
December 31, |
||||||
|
|
2024 |
|
2024 |
|
2023 |
||||||
Capital Ratios(1) |
|
|
|
|
|
|
|
|
|
|
|
|
Alerus Financial Corporation Consolidated |
|
|
|
|
|
|
|
|
|
|
|
|
Common equity tier 1 capital to risk weighted assets |
|
|
9.98 |
% |
|
|
11.12 |
% |
|
|
11.82 |
% |
Tier 1 capital to risk weighted assets |
|
|
10.18 |
% |
|
|
11.38 |
% |
|
|
12.10 |
% |
Total capital to risk weighted assets |
|
|
12.55 |
% |
|
|
14.04 |
% |
|
|
14.76 |
% |
Tier 1 capital to average assets |
|
|
8.68 |
% |
|
|
9.30 |
% |
|
|
10.57 |
% |
Tangible common equity / tangible assets (2) |
|
|
7.15 |
% |
|
|
8.11 |
% |
|
|
7.94 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Alerus Financial, N.A. |
|
|
|
|
|
|
|
|
|
|
|
|
Common equity tier 1 capital to risk weighted assets |
|
|
10.19 |
% |
|
|
10.73 |
% |
|
|
11.40 |
% |
Tier 1 capital to risk weighted assets |
|
|
10.19 |
% |
|
|
10.73 |
% |
|
|
11.40 |
% |
Total capital to risk weighted assets |
|
|
11.44 |
% |
|
|
11.98 |
% |
|
|
12.51 |
% |
Tier 1 capital to average assets |
|
|
8.66 |
% |
|
|
8.90 |
% |
|
|
9.92 |
% |
____________________ |
||
(1) |
Capital ratios for the current quarter are to be considered preliminary until the Call Report for Alerus Financial, N.A. is filed. |
|
(2) |
Represents a non-GAAP financial measure. See “Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures.” |
Conference Call
The Company will host a conference call at 11:00 a.m. Central Time on Wednesday, January 29, 2024, to discuss its financial results. Attendees are encouraged to register ahead of time for the call at investors.alerus.com. The call can also be accessed via telephone at +1 (833) 470-1428, using access code 092113. A recording of the call and transcript will be available on the Company’s investor relations website at investors.alerus.com following the call.
About Alerus Financial Corporation
Alerus Financial Corporation (Nasdaq: ALRS) is a commercial wealth bank and national retirement services provider with corporate offices in
Alerus operates 29 banking and commercial wealth offices, with locations in
Non-GAAP Financial Measures
Some of the financial measures included in this press release are not measures of financial performance recognized by
These non-GAAP financial measures should not be considered in isolation or as a substitute for total stockholders’ equity, total assets, book value per share, return on average assets, return on average equity, or any other measure calculated in accordance with GAAP. Moreover, the manner in which the Company calculates these non-GAAP financial measures may differ from that of other companies reporting measures with similar names.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in forward-looking statements include, among others, the following: interest rate risk, including the effects of changes in interest rates; effects on the
Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
Alerus Financial Corporation and Subsidiaries Consolidated Balance Sheets (dollars in thousands, except share and per share data) |
||||||||
|
|
December 31, |
|
|
December 31, |
|
||
|
|
2024 |
|
|
2023 |
|
||
Assets |
|
(Unaudited) |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
61,239 |
|
|
$ |
129,893 |
|
Investment securities |
|
|
|
|
|
|
|
|
Trading, at fair value |
|
|
3,309 |
|
|
|
— |
|
Available-for-sale, at fair value |
|
|
588,053 |
|
|
|
486,736 |
|
Held-to-maturity, at amortized cost (with an allowance for credit losses on investments of |
|
|
275,585 |
|
|
|
299,515 |
|
Loans held for sale |
|
|
16,518 |
|
|
|
11,497 |
|
Loans |
|
|
3,992,534 |
|
|
|
2,759,583 |
|
Allowance for credit losses on loans |
|
|
(59,929 |
) |
|
|
(35,843 |
) |
Net loans |
|
|
3,932,605 |
|
|
|
2,723,740 |
|
Land, premises and equipment, net |
|
|
39,780 |
|
|
|
17,940 |
|
Operating lease right-of-use assets |
|
|
13,438 |
|
|
|
5,436 |
|
Accrued interest receivable |
|
|
20,075 |
|
|
|
15,700 |
|
Bank-owned life insurance |
|
|
36,033 |
|
|
|
33,236 |
|
Goodwill |
|
|
87,564 |
|
|
|
46,783 |
|
Other intangible assets |
|
|
43,882 |
|
|
|
17,158 |
|
Servicing rights |
|
|
7,918 |
|
|
|
2,052 |
|
Deferred income taxes, net |
|
|
48,766 |
|
|
|
34,595 |
|
Other assets |
|
|
90,543 |
|
|
|
83,432 |
|
Total assets |
|
$ |
5,265,308 |
|
|
$ |
3,907,713 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
|
Deposits |
|
|
|
|
|
|
|
|
Noninterest-bearing |
|
$ |
903,466 |
|
|
$ |
728,082 |
|
Interest-bearing |
|
|
3,474,944 |
|
|
|
2,367,529 |
|
Total deposits |
|
|
4,378,410 |
|
|
|
3,095,611 |
|
Short-term borrowings |
|
|
238,960 |
|
|
|
314,170 |
|
Long-term debt |
|
|
59,069 |
|
|
|
58,956 |
|
Operating lease liabilities |
|
|
18,991 |
|
|
|
5,751 |
|
Accrued expenses and other liabilities |
|
|
71,179 |
|
|
|
64,098 |
|
Total liabilities |
|
|
4,766,609 |
|
|
|
3,538,586 |
|
Stockholders’ equity |
|
|
|
|
|
|
|
|
Preferred stock, |
|
|
— |
|
|
|
— |
|
Common stock, |
|
|
25,345 |
|
|
|
19,734 |
|
Additional paid-in capital |
|
|
269,708 |
|
|
|
150,343 |
|
Retained earnings |
|
|
277,012 |
|
|
|
272,705 |
|
Accumulated other comprehensive loss |
|
|
(73,366 |
) |
|
|
(73,655 |
) |
Total stockholders’ equity |
|
|
498,699 |
|
|
|
369,127 |
|
Total liabilities and stockholders’ equity |
|
$ |
5,265,308 |
|
|
$ |
3,907,713 |
|
Alerus Financial Corporation and Subsidiaries Consolidated Statements of Income (dollars and shares in thousands, except per share data) |
||||||||||||||||||||
|
|
Three months ended |
|
|
Year ended |
|
||||||||||||||
|
|
December 31, |
|
|
September 30, |
|
|
December 31, |
|
|
December 31, |
|
|
December 31, |
|
|||||
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|||||
Interest Income |
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|||||
Loans, including fees |
|
$ |
60,009 |
|
|
$ |
42,593 |
|
|
$ |
37,731 |
|
|
$ |
183,560 |
|
|
$ |
136,918 |
|
Investment securities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable |
|
|
5,737 |
|
|
|
4,596 |
|
|
|
6,040 |
|
|
|
19,745 |
|
|
|
24,262 |
|
Exempt from federal income taxes |
|
|
166 |
|
|
|
169 |
|
|
|
182 |
|
|
|
679 |
|
|
|
740 |
|
Other |
|
|
1,395 |
|
|
|
4,854 |
|
|
|
742 |
|
|
|
17,595 |
|
|
|
2,963 |
|
Total interest income |
|
|
67,307 |
|
|
|
52,212 |
|
|
|
44,695 |
|
|
|
221,579 |
|
|
|
164,883 |
|
Interest Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
25,521 |
|
|
|
22,285 |
|
|
|
17,169 |
|
|
|
89,243 |
|
|
|
53,387 |
|
Short-term borrowings |
|
|
2,837 |
|
|
|
6,706 |
|
|
|
5,292 |
|
|
|
22,584 |
|
|
|
20,976 |
|
Long-term debt |
|
|
665 |
|
|
|
679 |
|
|
|
682 |
|
|
|
2,707 |
|
|
|
2,681 |
|
Total interest expense |
|
|
29,023 |
|
|
|
29,670 |
|
|
|
23,143 |
|
|
|
114,534 |
|
|
|
77,044 |
|
Net interest income |
|
|
38,284 |
|
|
|
22,542 |
|
|
|
21,552 |
|
|
|
107,045 |
|
|
|
87,839 |
|
Provision for credit losses |
|
|
11,992 |
|
|
|
1,661 |
|
|
|
1,507 |
|
|
|
18,141 |
|
|
|
2,057 |
|
Net interest income after provision for credit losses |
|
|
26,292 |
|
|
|
20,881 |
|
|
|
20,045 |
|
|
|
88,904 |
|
|
|
85,782 |
|
Noninterest Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retirement and benefit services |
|
|
16,488 |
|
|
|
16,144 |
|
|
|
15,317 |
|
|
|
64,365 |
|
|
|
65,294 |
|
Wealth management |
|
|
7,010 |
|
|
|
6,684 |
|
|
|
5,940 |
|
|
|
26,171 |
|
|
|
21,855 |
|
Mortgage banking |
|
|
3,673 |
|
|
|
2,573 |
|
|
|
1,279 |
|
|
|
10,469 |
|
|
|
8,411 |
|
Service charges on deposit accounts |
|
|
644 |
|
|
|
488 |
|
|
|
341 |
|
|
|
1,976 |
|
|
|
1,280 |
|
Net gains (losses) on investment securities |
|
|
— |
|
|
|
— |
|
|
|
(24,643 |
) |
|
|
— |
|
|
|
(24,643 |
) |
Other |
|
|
6,059 |
|
|
|
2,474 |
|
|
|
2,557 |
|
|
|
11,950 |
|
|
|
8,032 |
|
Total noninterest income |
|
|
33,874 |
|
|
|
28,363 |
|
|
|
791 |
|
|
|
114,931 |
|
|
|
80,229 |
|
Noninterest Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation |
|
|
26,657 |
|
|
|
21,058 |
|
|
|
19,214 |
|
|
|
87,311 |
|
|
|
76,290 |
|
Employee taxes and benefits |
|
|
6,245 |
|
|
|
5,400 |
|
|
|
4,578 |
|
|
|
22,967 |
|
|
|
20,051 |
|
Occupancy and equipment expense |
|
|
1,963 |
|
|
|
2,082 |
|
|
|
1,858 |
|
|
|
7,766 |
|
|
|
7,477 |
|
Business services, software and technology expense |
|
|
6,935 |
|
|
|
4,879 |
|
|
|
5,686 |
|
|
|
21,758 |
|
|
|
21,053 |
|
Intangible amortization expense |
|
|
2,804 |
|
|
|
1,324 |
|
|
|
1,324 |
|
|
|
6,776 |
|
|
|
5,296 |
|
Professional fees and assessments |
|
|
6,530 |
|
|
|
4,267 |
|
|
|
2,345 |
|
|
|
15,162 |
|
|
|
6,743 |
|
Marketing and business development |
|
|
1,050 |
|
|
|
764 |
|
|
|
1,002 |
|
|
|
3,249 |
|
|
|
3,027 |
|
Supplies and postage |
|
|
726 |
|
|
|
422 |
|
|
|
521 |
|
|
|
2,046 |
|
|
|
1,796 |
|
Travel |
|
|
449 |
|
|
|
330 |
|
|
|
313 |
|
|
|
1,403 |
|
|
|
1,189 |
|
Mortgage and lending expenses |
|
|
571 |
|
|
|
684 |
|
|
|
501 |
|
|
|
2,162 |
|
|
|
1,902 |
|
Other |
|
|
2,093 |
|
|
|
1,237 |
|
|
|
1,312 |
|
|
|
5,641 |
|
|
|
5,333 |
|
Total noninterest expense |
|
|
56,023 |
|
|
|
42,447 |
|
|
|
38,654 |
|
|
|
176,241 |
|
|
|
150,157 |
|
Income before income tax expense |
|
|
4,143 |
|
|
|
6,797 |
|
|
|
(17,818 |
) |
|
|
27,594 |
|
|
|
15,854 |
|
Income tax expense |
|
|
921 |
|
|
|
1,590 |
|
|
|
(3,064 |
) |
|
|
6,525 |
|
|
|
4,158 |
|
Net income |
|
$ |
3,222 |
|
|
$ |
5,207 |
|
|
$ |
(14,754 |
) |
|
$ |
21,069 |
|
|
$ |
11,696 |
|
Per Common Share Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share |
|
$ |
0.13 |
|
|
$ |
0.26 |
|
|
$ |
(0.73 |
) |
|
$ |
1.00 |
|
|
$ |
0.59 |
|
Diluted earnings per common share |
|
$ |
0.13 |
|
|
$ |
0.26 |
|
|
$ |
(0.73 |
) |
|
$ |
0.98 |
|
|
$ |
0.58 |
|
Dividends declared per common share |
|
$ |
0.20 |
|
|
$ |
0.20 |
|
|
$ |
0.19 |
|
|
$ |
0.79 |
|
|
$ |
0.75 |
|
Average common shares outstanding |
|
|
24,857 |
|
|
|
19,788 |
|
|
|
19,761 |
|
|
|
21,047 |
|
|
|
19,922 |
|
Diluted average common shares outstanding |
|
|
25,144 |
|
|
|
20,075 |
|
|
|
19,996 |
|
|
|
21,321 |
|
|
|
20,143 |
|
Alerus Financial Corporation and Subsidiaries Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures (unaudited) (dollars and shares in thousands, except per share data) |
||||||||||||
|
|
December 31, |
|
September 30, |
|
December 31, |
||||||
|
|
2024 |
|
2024 |
|
2023 |
||||||
Tangible Common Equity to Tangible Assets |
|
|
|
|
|
|
|
|
|
|
|
|
Total common stockholders’ equity |
|
$ |
498,699 |
|
|
$ |
386,486 |
|
|
$ |
369,127 |
|
Less: Goodwill |
|
|
87,564 |
|
|
|
46,783 |
|
|
|
46,783 |
|
Less: Other intangible assets |
|
|
43,882 |
|
|
|
13,186 |
|
|
|
17,158 |
|
Tangible common equity (a) |
|
|
367,253 |
|
|
|
326,517 |
|
|
|
305,186 |
|
Total assets |
|
|
5,265,308 |
|
|
|
4,084,640 |
|
|
|
3,907,713 |
|
Less: Goodwill |
|
|
87,564 |
|
|
|
46,783 |
|
|
|
46,783 |
|
Less: Other intangible assets |
|
|
43,882 |
|
|
|
13,186 |
|
|
|
17,158 |
|
Tangible assets (b) |
|
|
5,133,862 |
|
|
|
4,024,671 |
|
|
|
3,843,772 |
|
Tangible common equity to tangible assets (a)/(b) |
|
|
7.15 |
% |
|
|
8.11 |
% |
|
|
7.94 |
% |
Tangible Book Value Per Common Share |
|
|
|
|
|
|
|
|
|
|
|
|
Total common stockholders’ equity |
|
$ |
498,699 |
|
|
$ |
386,486 |
|
|
$ |
369,127 |
|
Less: Goodwill |
|
|
87,564 |
|
|
|
46,783 |
|
|
|
46,783 |
|
Less: Other intangible assets |
|
|
43,882 |
|
|
|
13,186 |
|
|
|
17,158 |
|
Tangible common equity (c) |
|
|
367,253 |
|
|
|
326,517 |
|
|
|
305,186 |
|
Total common shares issued and outstanding (d) |
|
|
25,345 |
|
|
|
19,790 |
|
|
|
19,734 |
|
Tangible book value per common share (c)/(d) |
|
$ |
14.49 |
|
|
$ |
16.50 |
|
|
$ |
15.46 |
|
|
|
Three months ended |
|
Year ended |
||||||||||||||||
|
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
December 31, |
||||||||||
|
|
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||
Return on Average Tangible Common Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
3,222 |
|
|
$ |
5,207 |
|
|
$ |
(14,754 |
) |
|
$ |
21,069 |
|
|
$ |
11,696 |
|
Add: Intangible amortization expense (net of tax)(1) |
|
|
2,215 |
|
|
|
1,046 |
|
|
|
1,046 |
|
|
|
5,353 |
|
|
|
4,184 |
|
Net income, excluding intangible amortization (e) |
|
|
5,437 |
|
|
|
6,253 |
|
|
|
(13,708 |
) |
|
|
26,422 |
|
|
|
15,880 |
|
Average total equity |
|
|
478,128 |
|
|
|
375,229 |
|
|
|
349,382 |
|
|
|
397,747 |
|
|
|
358,268 |
|
Less: Average goodwill |
|
|
84,414 |
|
|
|
46,783 |
|
|
|
46,783 |
|
|
|
56,242 |
|
|
|
46,959 |
|
Less: Average other intangible assets (net of tax)(1) |
|
|
34,107 |
|
|
|
10,933 |
|
|
|
14,067 |
|
|
|
17,534 |
|
|
|
15,624 |
|
Average tangible common equity (f) |
|
|
359,607 |
|
|
|
317,513 |
|
|
|
288,532 |
|
|
|
323,971 |
|
|
|
295,685 |
|
Return on average tangible common equity (e)/(f) |
|
|
6.01 |
% |
|
|
7.83 |
% |
|
|
(18.85 |
)% |
|
|
8.16 |
% |
|
|
5.37 |
% |
Efficiency Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense |
|
$ |
56,023 |
|
|
$ |
42,447 |
|
|
$ |
38,654 |
|
|
$ |
176,241 |
|
|
$ |
150,157 |
|
Less: Intangible amortization expense |
|
|
2,804 |
|
|
|
1,324 |
|
|
|
1,324 |
|
|
|
6,776 |
|
|
|
5,296 |
|
Adjusted noninterest expense (g) |
|
|
53,219 |
|
|
|
41,123 |
|
|
|
37,330 |
|
|
|
169,465 |
|
|
|
144,861 |
|
Net interest income |
|
|
38,284 |
|
|
|
22,542 |
|
|
|
21,552 |
|
|
|
107,045 |
|
|
|
87,839 |
|
Noninterest income |
|
|
33,874 |
|
|
|
28,363 |
|
|
|
791 |
|
|
|
114,931 |
|
|
|
80,229 |
|
Tax-equivalent adjustment |
|
|
385 |
|
|
|
314 |
|
|
|
226 |
|
|
|
1,202 |
|
|
|
671 |
|
Total tax-equivalent revenue (h) |
|
|
72,543 |
|
|
|
51,219 |
|
|
|
22,569 |
|
|
|
223,178 |
|
|
|
168,739 |
|
Efficiency ratio (g)/(h) |
|
|
73.36 |
% |
|
|
80.29 |
% |
|
|
165.40 |
% |
|
|
75.93 |
% |
|
|
85.85 |
% |
____________________ |
||
(1) |
Items calculated after-tax utilizing a marginal income tax rate of |
Alerus Financial Corporation and Subsidiaries Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures (unaudited) (dollars and shares in thousands, except per share data) |
||||||||||||||||||||
|
|
Three months ended |
|
Year ended |
||||||||||||||||
|
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
December 31, |
||||||||||
|
|
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||
Pre-Provision Net Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
38,284 |
|
|
$ |
22,542 |
|
|
$ |
21,552 |
|
|
$ |
107,045 |
|
|
$ |
87,839 |
|
Add: Noninterest income |
|
|
33,874 |
|
|
|
28,363 |
|
|
|
791 |
|
|
|
114,931 |
|
|
|
80,229 |
|
Less: Noninterest expense |
|
|
56,023 |
|
|
|
42,447 |
|
|
|
38,654 |
|
|
|
176,241 |
|
|
|
150,157 |
|
Pre-provision net revenue |
|
$ |
16,135 |
|
|
$ |
8,458 |
|
|
$ |
(16,311 |
) |
|
$ |
45,735 |
|
|
$ |
17,911 |
|
Adjusted Noninterest Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest income |
|
$ |
33,874 |
|
|
$ |
28,363 |
|
|
$ |
791 |
|
|
$ |
114,931 |
|
|
$ |
80,229 |
|
Less: Adjusted noninterest income items |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BOLI mortality proceeds (non-taxable) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,196 |
|
Gain on sale of ESOP trustee business |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,775 |
|
Net gains (losses) on investment securities |
|
|
— |
|
|
|
— |
|
|
|
(24,643 |
) |
|
|
— |
|
|
|
(24,643 |
) |
Net gain on sale of premises and equipment |
|
|
3,459 |
|
|
|
476 |
|
|
|
— |
|
|
|
3,941 |
|
|
|
50 |
|
Total adjusted noninterest income items (i) |
|
|
3,459 |
|
|
|
476 |
|
|
|
(24,643 |
) |
|
|
3,941 |
|
|
|
(20,622 |
) |
Adjusted noninterest income (j) |
|
$ |
30,415 |
|
|
$ |
27,887 |
|
|
$ |
25,434 |
|
|
$ |
110,990 |
|
|
$ |
100,851 |
|
Adjusted Noninterest Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense |
|
$ |
56,023 |
|
|
$ |
42,447 |
|
|
$ |
38,654 |
|
|
$ |
176,241 |
|
|
$ |
150,157 |
|
Less: Adjusted noninterest expense items |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HMNF merger- and acquisition-related expenses |
|
|
3,295 |
|
|
|
1,661 |
|
|
|
— |
|
|
|
5,546 |
|
|
|
— |
|
Severance and signing bonus expense |
|
|
2,276 |
|
|
|
31 |
|
|
|
422 |
|
|
|
2,901 |
|
|
|
1,897 |
|
Total adjusted noninterest expense items (k) |
|
|
5,571 |
|
|
|
1,692 |
|
|
|
422 |
|
|
|
8,447 |
|
|
|
1,897 |
|
Adjusted noninterest expense (l) |
|
$ |
50,452 |
|
|
$ |
40,755 |
|
|
$ |
38,232 |
|
|
$ |
167,794 |
|
|
$ |
148,260 |
|
Adjusted Pre-Provision Net Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
38,284 |
|
|
$ |
22,542 |
|
|
$ |
21,552 |
|
|
$ |
107,045 |
|
|
$ |
87,839 |
|
Add: Adjusted noninterest income (j) |
|
|
30,415 |
|
|
|
27,887 |
|
|
|
25,434 |
|
|
|
110,990 |
|
|
|
100,851 |
|
Less: Adjusted noninterest expense (l) |
|
|
50,452 |
|
|
|
40,755 |
|
|
|
38,232 |
|
|
|
167,794 |
|
|
|
148,260 |
|
Adjusted pre-provision net revenue |
|
$ |
18,247 |
|
|
$ |
9,674 |
|
|
$ |
8,754 |
|
|
$ |
50,241 |
|
|
$ |
40,430 |
|
Adjusted Efficiency Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted noninterest expense (l) |
|
$ |
50,452 |
|
|
$ |
40,755 |
|
|
$ |
38,232 |
|
|
$ |
167,794 |
|
|
$ |
148,260 |
|
Less: Intangible amortization expense |
|
|
2,804 |
|
|
|
1,324 |
|
|
|
1,324 |
|
|
|
6,776 |
|
|
|
5,296 |
|
Adjusted noninterest expense for efficiency ratio (m) |
|
|
47,648 |
|
|
|
39,431 |
|
|
|
36,908 |
|
|
|
161,018 |
|
|
|
142,964 |
|
Tax-equivalent revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
38,284 |
|
|
|
22,542 |
|
|
|
21,552 |
|
|
|
107,045 |
|
|
|
87,839 |
|
Add: Adjusted noninterest income (j) |
|
|
30,415 |
|
|
|
27,887 |
|
|
|
25,434 |
|
|
|
110,990 |
|
|
|
100,851 |
|
Add: Tax-equivalent adjustment |
|
|
385 |
|
|
|
314 |
|
|
|
226 |
|
|
|
1,202 |
|
|
|
671 |
|
Total tax-equivalent revenue (n) |
|
|
69,084 |
|
|
|
50,743 |
|
|
|
47,212 |
|
|
|
219,237 |
|
|
|
189,361 |
|
Adjusted efficiency ratio (m)/(n) |
|
|
68.97 |
% |
|
|
77.71 |
% |
|
|
78.18 |
% |
|
|
73.44 |
% |
|
|
75.50 |
% |
Adjusted Net Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
3,222 |
|
|
$ |
5,207 |
|
|
$ |
(14,754 |
) |
|
$ |
21,069 |
|
|
$ |
11,696 |
|
Less: Adjusted noninterest income items (net of tax)(1) (i) |
|
|
2,733 |
|
|
|
376 |
|
|
|
(19,468 |
) |
|
|
3,113 |
|
|
|
(16,040 |
) |
Add: HMNF day one provision for credit losses and unfunded commitments (net of tax)(1) |
|
|
6,140 |
|
|
|
— |
|
|
|
— |
|
|
|
6,140 |
|
|
|
— |
|
Add: Adjusted noninterest expense items (net of tax)(1) (k) |
|
|
4,401 |
|
|
|
1,337 |
|
|
|
333 |
|
|
|
6,673 |
|
|
|
1,499 |
|
Adjusted net income (o) |
|
$ |
11,030 |
|
|
$ |
6,168 |
|
|
$ |
5,047 |
|
|
$ |
30,769 |
|
|
$ |
29,235 |
|
Adjusted Return on Average Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average total assets (p) |
|
$ |
5,272,816 |
|
|
$ |
4,298,080 |
|
|
$ |
3,868,206 |
|
|
$ |
4,503,493 |
|
|
$ |
3,817,017 |
|
Adjusted return on average assets (o)/(p) |
|
|
0.83 |
% |
|
|
0.57 |
% |
|
|
0.52 |
% |
|
|
0.68 |
% |
|
|
0.77 |
% |
Adjusted Return on Average Tangible Common Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income (o) |
|
$ |
11,030 |
|
|
$ |
6,168 |
|
|
$ |
5,047 |
|
|
$ |
30,769 |
|
|
$ |
29,235 |
|
Add: Intangible amortization expense (net of tax)(1) |
|
|
2,215 |
|
|
|
1,046 |
|
|
|
1,046 |
|
|
|
5,353 |
|
|
|
4,184 |
|
Adjusted net income, excluding intangible amortization (q) |
|
|
13,245 |
|
|
|
7,214 |
|
|
|
6,093 |
|
|
|
36,122 |
|
|
|
33,419 |
|
Average total equity |
|
|
478,128 |
|
|
|
375,229 |
|
|
|
349,382 |
|
|
|
397,747 |
|
|
|
358,268 |
|
Less: Average goodwill |
|
|
84,414 |
|
|
|
46,783 |
|
|
|
46,783 |
|
|
|
56,242 |
|
|
|
46,959 |
|
Less: Average other intangible assets (net of tax) |
|
|
34,107 |
|
|
|
10,933 |
|
|
|
14,067 |
|
|
|
17,534 |
|
|
|
15,624 |
|
Average tangible common equity (r) |
|
|
359,607 |
|
|
|
317,513 |
|
|
|
288,532 |
|
|
|
323,971 |
|
|
|
295,685 |
|
Return on average tangible common equity (q)/(r) |
|
|
14.65 |
% |
|
|
9.04 |
% |
|
|
8.38 |
% |
|
|
11.15 |
% |
|
|
11.30 |
% |
____________________ |
||
(1) |
Items calculated after-tax utilizing a marginal income tax rate of |
Alerus Financial Corporation and Subsidiaries Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures (unaudited) (dollars and shares in thousands, except per share data) |
||||||||||||||||||||
|
|
Three months ended |
|
Year ended |
||||||||||||||||
|
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
December 31, |
||||||||||
|
|
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||||
Adjusted Net Interest Margin (Tax-Equivalent) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
38,284 |
|
|
$ |
22,542 |
|
|
$ |
21,552 |
|
|
$ |
107,045 |
|
|
$ |
87,839 |
|
Less: BTFP cash interest income |
|
|
— |
|
|
|
4,113 |
|
|
|
— |
|
|
|
12,494 |
|
|
|
— |
|
Add: BTFP interest expense |
|
|
— |
|
|
|
3,717 |
|
|
|
— |
|
|
|
11,291 |
|
|
|
— |
|
Less: Purchase accounting net accretion |
|
|
4,692 |
|
|
|
152 |
|
|
|
521 |
|
|
|
6,121 |
|
|
|
1,490 |
|
Net interest income excluding BTFP impact |
|
|
33,592 |
|
|
|
21,994 |
|
|
|
21,031 |
|
|
|
99,721 |
|
|
|
86,349 |
|
Add: Tax equivalent adjustment for loans and securities |
|
|
385 |
|
|
|
314 |
|
|
|
226 |
|
|
|
1,202 |
|
|
|
671 |
|
Adjusted net interest income (s) |
|
$ |
33,977 |
|
|
$ |
22,308 |
|
|
$ |
21,257 |
|
|
$ |
100,923 |
|
|
$ |
87,020 |
|
Interest earning assets |
|
|
4,808,230 |
|
|
|
4,077,716 |
|
|
|
3,645,184 |
|
|
|
4,221,832 |
|
|
|
3,592,476 |
|
Less: Average cash proceeds balance from BTFP |
|
|
— |
|
|
|
303,043 |
|
|
|
— |
|
|
|
231,366 |
|
|
|
— |
|
Add: Change in unearned purchase accounting discount |
|
|
4,692 |
|
|
|
152 |
|
|
|
521 |
|
|
|
6,121 |
|
|
|
1,490 |
|
Adjusted interest earning assets (t) |
|
$ |
4,812,922 |
|
|
$ |
3,774,825 |
|
|
$ |
3,645,705 |
|
|
$ |
3,996,587 |
|
|
$ |
3,593,966 |
|
Adjusted net interest margin (tax-equivalent) (s)/(t) |
|
|
2.81 |
% |
|
|
2.35 |
% |
|
|
2.31 |
% |
|
|
2.53 |
% |
|
|
2.42 |
% |
Adjusted Earnings Per Common Share - Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income (o) |
|
$ |
11,030 |
|
|
$ |
6,168 |
|
|
$ |
5,047 |
|
|
$ |
30,769 |
|
|
$ |
29,235 |
|
Less: Dividends and undistributed earnings allocated to participating securities |
|
|
(16 |
) |
|
|
24 |
|
|
|
(247 |
) |
|
|
79 |
|
|
|
(5 |
) |
Net income available to common stockholders (u) |
|
|
11,046 |
|
|
|
6,144 |
|
|
|
5,294 |
|
|
|
30,690 |
|
|
|
29,240 |
|
Weighted-average common shares outstanding for diluted earnings per share (v) |
|
|
25,144 |
|
|
|
20,075 |
|
|
|
19,996 |
|
|
|
21,321 |
|
|
|
20,143 |
|
Adjusted earnings per common share - diluted (u)/(v) |
|
$ |
0.44 |
|
|
$ |
0.31 |
|
|
$ |
0.26 |
|
|
$ |
1.44 |
|
|
$ |
1.45 |
|
____________________ |
||
(1) |
Items calculated after-tax utilizing a marginal income tax rate of |
Alerus Financial Corporation and Subsidiaries Analysis of Average Balances, Yields, and Rates (unaudited) (dollars in thousands) |
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|
Three months ended |
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Year ended |
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|
|
December 31, 2024 |
|
September 30, 2024 |
|
December 31, 2023 |
|
December 31, 2024 |
|
December 31, 2023 |
||||||||||||||||||||||||||||||
|
|
|
|
|
|
Average |
|
|
|
|
|
Average |
|
|
|
|
|
Average |
|
|
|
|
|
Average |
|
|
|
|
|
Average |
||||||||||
|
|
Average |
|
|
Yield/ |
|
Average |
|
|
Yield/ |
|
Average |
|
|
Yield/ |
|
Average |
|
|
Yield/ |
|
Average |
|
|
Yield/ |
|||||||||||||||
|
|
Balance |
|
|
Rate |
|
Balance |
|
|
Rate |
|
Balance |
|
|
Rate |
|
Balance |
|
|
Rate |
|
Balance |
|
|
Rate |
|||||||||||||||
Interest Earning Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits with banks |
|
$ |
74,054 |
|
|
|
5.35 |
% |
|
$ |
326,350 |
|
|
|
5.47 |
% |
|
$ |
33,920 |
|
|
|
3.23 |
% |
|
$ |
299,625 |
|
|
|
5.39 |
% |
|
$ |
35,395 |
|
|
|
3.40 |
% |
Investment securities(1) |
|
|
883,116 |
|
|
|
2.68 |
|
|
|
749,062 |
|
|
|
2.55 |
|
|
|
921,555 |
|
|
|
2.70 |
|
|
|
791,111 |
|
|
|
2.60 |
|
|
|
983,545 |
|
|
|
2.56 |
|
Loans held for sale |
|
|
15,409 |
|
|
|
5.60 |
|
|
|
15,795 |
|
|
|
3.20 |
|
|
|
11,421 |
|
|
|
6.01 |
|
|
|
14,180 |
|
|
|
5.90 |
|
|
|
13,217 |
|
|
|
5.46 |
|
Loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
|
|
616,356 |
|
|
|
7.28 |
|
|
|
593,685 |
|
|
|
7.26 |
|
|
|
538,694 |
|
|
|
6.90 |
|
|
|
588,269 |
|
|
|
7.23 |
|
|
|
527,795 |
|
|
|
6.63 |
|
CRE − Construction, land and development |
|
|
250,869 |
|
|
|
6.33 |
|
|
|
184,611 |
|
|
|
5.68 |
|
|
|
117,765 |
|
|
|
8.12 |
|
|
|
172,700 |
|
|
|
6.77 |
|
|
|
99,315 |
|
|
|
7.66 |
|
CRE − Multifamily |
|
|
351,804 |
|
|
|
6.50 |
|
|
|
242,558 |
|
|
|
5.62 |
|
|
|
227,453 |
|
|
|
5.48 |
|
|
|
272,125 |
|
|
|
5.87 |
|
|
|
185,262 |
|
|
|
5.25 |
|
CRE − Non-owner occupied |
|
|
1,002,857 |
|
|
|
6.68 |
|
|
|
663,539 |
|
|
|
5.88 |
|
|
|
519,021 |
|
|
|
5.67 |
|
|
|
712,734 |
|
|
|
6.14 |
|
|
|
498,884 |
|
|
|
5.28 |
|
CRE − Owner occupied |
|
|
293,169 |
|
|
|
6.56 |
|
|
|
289,963 |
|
|
|
5.41 |
|
|
|
266,274 |
|
|
|
5.18 |
|
|
|
286,540 |
|
|
|
5.71 |
|
|
|
256,690 |
|
|
|
5.07 |
|
Agricultural − Land |
|
|
59,400 |
|
|
|
5.73 |
|
|
|
42,162 |
|
|
|
4.93 |
|
|
|
41,064 |
|
|
|
4.82 |
|
|
|
45,729 |
|
|
|
5.10 |
|
|
|
39,832 |
|
|
|
4.78 |
|
Agricultural − Production |
|
|
58,999 |
|
|
|
7.36 |
|
|
|
40,964 |
|
|
|
6.84 |
|
|
|
34,480 |
|
|
|
6.64 |
|
|
|
43,361 |
|
|
|
6.89 |
|
|
|
30,663 |
|
|
|
6.48 |
|
RRE − First lien |
|
|
904,414 |
|
|
|
4.50 |
|
|
|
689,382 |
|
|
|
3.98 |
|
|
|
691,152 |
|
|
|
3.95 |
|
|
|
747,874 |
|
|
|
4.17 |
|
|
|
673,118 |
|
|
|
3.80 |
|
RRE − Construction |
|
|
31,722 |
|
|
|
9.74 |
|
|
|
16,792 |
|
|
|
3.86 |
|
|
|
32,958 |
|
|
|
4.97 |
|
|
|
22,832 |
|
|
|
6.58 |
|
|
|
33,508 |
|
|
|
4.98 |
|
RRE − HELOC |
|
|
153,344 |
|
|
|
7.60 |
|
|
|
130,705 |
|
|
|
8.00 |
|
|
|
118,722 |
|
|
|
8.37 |
|
|
|
131,617 |
|
|
|
8.02 |
|
|
|
118,653 |
|
|
|
8.07 |
|
RRE − Junior lien |
|
|
47,041 |
|
|
|
6.25 |
|
|
|
36,818 |
|
|
|
5.74 |
|
|
|
36,415 |
|
|
|
6.21 |
|
|
|
38,982 |
|
|
|
6.24 |
|
|
|
35,382 |
|
|
|
5.83 |
|
Other consumer |
|
|
44,959 |
|
|
|
7.19 |
|
|
|
37,768 |
|
|
|
6.76 |
|
|
|
29,510 |
|
|
|
6.33 |
|
|
|
36,252 |
|
|
|
6.81 |
|
|
|
35,971 |
|
|
|
6.06 |
|
Total loans(1) |
|
|
3,814,934 |
|
|
|
6.27 |
|
|
|
2,968,947 |
|
|
|
5.73 |
|
|
|
2,653,508 |
|
|
|
5.64 |
|
|
|
3,099,015 |
|
|
|
5.93 |
|
|
|
2,535,073 |
|
|
|
5.39 |
|
Federal Reserve/FHLB stock |
|
|
20,717 |
|
|
|
7.66 |
|
|
|
17,562 |
|
|
|
8.25 |
|
|
|
24,780 |
|
|
|
7.48 |
|
|
|
17,901 |
|
|
|
8.12 |
|
|
|
25,246 |
|
|
|
6.98 |
|
Total interest earning assets |
|
|
4,808,230 |
|
|
|
5.60 |
|
|
|
4,077,716 |
|
|
|
5.12 |
|
|
|
3,645,184 |
|
|
|
4.89 |
|
|
|
4,221,832 |
|
|
|
5.28 |
|
|
|
3,592,476 |
|
|
|
4.61 |
|
Noninterest earning assets |
|
|
464,586 |
|
|
|
|
|
|
|
220,364 |
|
|
|
|
|
|
|
223,022 |
|
|
|
|
|
|
|
281,661 |
|
|
|
|
|
|
|
224,541 |
|
|
|
|
|
Total assets |
|
$ |
5,272,816 |
|
|
|
|
|
|
$ |
4,298,080 |
|
|
|
|
|
|
$ |
3,868,206 |
|
|
|
|
|
|
$ |
4,503,493 |
|
|
|
|
|
|
$ |
3,817,017 |
|
|
|
|
|
Interest-Bearing Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand deposits |
|
$ |
1,209,674 |
|
|
|
1.98 |
% |
|
$ |
1,003,595 |
|
|
|
2.31 |
% |
|
$ |
798,634 |
|
|
|
1.65 |
% |
|
$ |
1,010,888 |
|
|
|
2.12 |
% |
|
$ |
768,238 |
|
|
|
1.29 |
% |
Money market and savings deposits |
|
|
1,520,616 |
|
|
|
3.15 |
|
|
|
1,146,896 |
|
|
|
3.82 |
|
|
|
1,092,656 |
|
|
|
3.53 |
|
|
|
1,250,939 |
|
|
|
3.60 |
|
|
|
1,118,815 |
|
|
|
2.92 |
|
Time deposits |
|
|
698,358 |
|
|
|
4.24 |
|
|
|
485,533 |
|
|
|
4.46 |
|
|
|
383,715 |
|
|
|
4.27 |
|
|
|
518,826 |
|
|
|
4.39 |
|
|
|
303,746 |
|
|
|
3.58 |
|
Fed funds purchased and BTFP |
|
|
22,012 |
|
|
|
4.93 |
|
|
|
327,543 |
|
|
|
4.97 |
|
|
|
189,568 |
|
|
|
5.71 |
|
|
|
249,180 |
|
|
|
4.95 |
|
|
|
287,768 |
|
|
|
5.31 |
|
FHLB short-term advances |
|
|
200,000 |
|
|
|
5.10 |
|
|
|
200,000 |
|
|
|
5.20 |
|
|
|
200,000 |
|
|
|
5.09 |
|
|
|
200,000 |
|
|
|
5.12 |
|
|
|
113,973 |
|
|
|
5.00 |
|
Long-term debt |
|
|
59,055 |
|
|
|
4.48 |
|
|
|
59,027 |
|
|
|
4.58 |
|
|
|
58,943 |
|
|
|
4.59 |
|
|
|
59,013 |
|
|
|
4.59 |
|
|
|
58,900 |
|
|
|
4.55 |
|
Total interest-bearing liabilities |
|
|
3,709,715 |
|
|
|
3.11 |
|
|
|
3,222,594 |
|
|
|
3.66 |
|
|
|
2,723,516 |
|
|
|
3.37 |
|
|
|
3,288,846 |
|
|
|
3.48 |
|
|
|
2,651,440 |
|
|
|
2.91 |
|
Noninterest-Bearing Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing deposits |
|
|
847,153 |
|
|
|
|
|
|
|
628,114 |
|
|
|
|
|
|
|
719,895 |
|
|
|
|
|
|
|
704,463 |
|
|
|
|
|
|
|
737,365 |
|
|
|
|
|
Other noninterest-bearing liabilities |
|
|
237,820 |
|
|
|
|
|
|
|
72,143 |
|
|
|
|
|
|
|
75,413 |
|
|
|
|
|
|
|
112,437 |
|
|
|
|
|
|
|
69,944 |
|
|
|
|
|
Stockholders’ equity |
|
|
478,128 |
|
|
|
|
|
|
|
375,229 |
|
|
|
|
|
|
|
349,382 |
|
|
|
|
|
|
|
397,747 |
|
|
|
|
|
|
|
358,268 |
|
|
|
|
|
Total liabilities and stockholders’ equity |
|
$ |
5,272,816 |
|
|
|
|
|
|
$ |
4,298,080 |
|
|
|
|
|
|
$ |
3,868,206 |
|
|
|
|
|
|
$ |
4,503,493 |
|
|
|
|
|
|
$ |
3,817,017 |
|
|
|
|
|
Net interest rate spread |
|
|
|
|
|
|
2.49 |
% |
|
|
|
|
|
|
1.46 |
% |
|
|
|
|
|
|
1.52 |
% |
|
|
|
|
|
|
1.80 |
% |
|
|
|
|
|
|
1.70 |
% |
Net interest margin, tax-equivalent (1) |
|
|
|
|
|
|
3.20 |
% |
|
|
|
|
|
|
2.23 |
% |
|
|
|
|
|
|
2.37 |
% |
|
|
|
|
|
|
2.56 |
% |
|
|
|
|
|
|
2.46 |
% |
____________________ |
||
(1) |
Taxable-equivalent adjustment was calculated utilizing a marginal income tax rate of |
View source version on businesswire.com: https://www.businesswire.com/news/home/20250128310319/en/
Alan A. Villalon, Chief Financial Officer
952.417.3733 (Office)
Source: Alerus Financial Corporation