ConnectOne Bancorp targets 2.90% NIM in Q1 2025, with merger synergies to boost profitability
Financial Performance: ConnectOne Bancorp reported a strong Q4 2024 with a 21% sequential increase in net income, driven by improved net interest margins and core deposit growth. The company anticipates further margin expansion to 2.90% in Q1 2025, bolstered by its upcoming merger with First National Bank of Long Island.
Merger Outlook and Analyst Sentiment: Management expressed confidence in the merger's potential to enhance profitability and market presence, projecting significant operational efficiencies and revenue synergies. Analysts remain cautiously optimistic, focusing on credit quality and integration risks while acknowledging the company's strategic positioning for growth.
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ConnectOne Bancorp Q4 2025 Earnings Call Highlights
- Asset Growth: ConnectOne Bancorp achieved $14 billion in assets and surpassed a $1.4 billion market cap in 2025, demonstrating the strength of its business model and the value of its client-first culture.
- Deposit and Loan Growth: Client deposits increased by approximately 5% on an annualized basis in the second half of 2025, with loan portfolio growth at a similar rate, although offset by higher payoffs due to refinancing.
- Operating Earnings Increase: Operating earnings for the quarter rose 18.6% sequentially, driving quarterly return on assets to 1.24%, which enhances the company's overall financial performance.
- Future Outlook: The company expects net interest margin to rise by 5 basis points in Q1 2026, with loan portfolio growth anticipated in the 3% to 5% range, and management is optimistic about future capital deployment and dividend increases.
ConnectOne Bancorp's Series A Preferred Stock Exceeds 5.5% Yield Threshold
Stock Performance: ConnectOne Bancorp Inc's Dep Shares (CNOBP) are up approximately 0.5% while the common shares (CNOB) are down about 0.1% in Friday trading.
Dividend History: A chart detailing the historical dividend payments for ConnectOne Bancorp Inc's Dep Shares 5.25% Reset Rate Non-Cumul Preferred Stock Ser A is provided.
Comparison Chart: A chart comparing the one-year performance of CNOBP shares against CNOB shares is included.
Author's Opinion Disclaimer: The views expressed in the article are those of the author and do not necessarily reflect the opinions of Nasdaq, Inc.
