Landmark Bancorp, Inc. (LARK) Q4 2025 Earnings Call Prepared Remarks Transcript
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Overview
The earnings call presents a mixed picture: strong financial performance with increased net income and EPS, but concerns over nonperforming loans and increased expenses. The Q&A section did not provide additional insights to alter the sentiment. The dividend declaration is positive, but noninterest income decline and investment portfolio losses pose risks. Overall, the positive financial metrics are balanced by credit risks and expense pressures, leading to a neutral stock price prediction.
Key Financial Performance
Net Income (Q4 2025) $4.7 million, an increase from $3.3 million in Q4 2024. The increase was mainly due to continued growth in net interest income.
Diluted Earnings Per Share (Q4 2025) $0.77, contributing to a full-year EPS of $3.07, which is a 43% increase over 2024 EPS.
Tangible Book Value Per Share $20.79, an increase of $0.83 from the prior quarter and $4.09 (24%) over year-end 2024.
Revenue Growth (2025) 17%, driven by continued expansion in net interest income.
Net Interest Margin (2025) 3.86%, an increase of 58 basis points year-over-year, driven by an attractive cost of deposits (1.56%).
Efficiency Ratio (2025) 62.7%, an improvement from 69.1% in 2024, due to controlled expense growth and enhanced capabilities.
Average Total Loan Growth (2025) 11.5%, with loans ending the year at $1.1 billion. Growth was led by commercial real estate loans and an 11% increase in mortgage originations.
Allowance for Credit Losses (Q4 2025) $12.5 million, representing 1.12% of gross loans. Net charge-offs totaled $341,000, down from $2.3 million in the prior quarter.
Nonperforming Loans (Year-End 2025) $10 million, a reduction of $3.1 million (24%) compared to year-end 2024.
Deposits (Year-End 2025) $1.4 billion, an increase of $63.4 million in Q4 2025 and $60.1 million year-over-year, driven by seasonal growth in public funds and core deposits.
Net Interest Margin (Q4 2025) 4.03%, an improvement of 20 basis points from Q3 2025 and 52 basis points from Q4 2024.
Noninterest Income (Q4 2025) $3.9 million, a decrease of $169,000 from the prior quarter, primarily due to a $101,000 loss on the sale of lower-yielding investment securities.
Noninterest Expense (Q4 2025) $12.3 million, an increase of $1.0 million from the prior quarter, driven by higher compensation and benefits, professional fees, and an impairment loss on repossessed assets.
Stockholders' Equity (Year-End 2025) $160.6 million, an increase of $4.9 million in Q4 2025, driven by net earnings and a decline in other comprehensive loss.
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Operating Highlights
Loan Growth: Achieved 11.5% average total loan growth in 2025, with loans ending the year at $1.1 billion. Growth was led by commercial real estate loans and agricultural portfolios.
Deposit Growth: Deposits increased by $63.4 million in Q4 2025 compared to the prior quarter, driven by seasonal growth in public funds and core deposits. Year-over-year, deposits grew by $60.1 million.
Revenue Growth: Revenue grew by 17% in 2025, driven by expansion in net interest income and pricing discipline. Net interest margin increased by 58 basis points to 3.86%.
Efficiency Ratio: Improved to 62.7% in 2025 from 69.1% in 2024, reflecting controlled expense growth and enhanced customer service capabilities.
Credit Risk Management: Nonperforming loans decreased by $3.1 million (24%) year-over-year, with proactive monitoring and reduction of problem credits. Allowance for credit losses stood at $12.5 million or 1.12% of gross loans.
Strategic Investments: Focused on investing in talent and capabilities to better serve customers and capitalize on growth opportunities in 2026.
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Risk or Challenges
Nonperforming Loans: Nonperforming loans totaled just under $10 million or 0.90% of gross loans as of December 31, 2025. While this is an improvement from the prior year, it still represents a risk to the company's financial health.
Loan Charge-offs: Net loan charge-offs for Q4 totaled $341,000, an increase from $219,000 during Q4 of 2024. Year-to-date, net loan charge-offs represent 0.25% of average loans, indicating ongoing credit risk.
Allowance for Credit Losses: The allowance for credit losses stood at $12.5 million or 1.12% of gross loans. This provision reflects the company's efforts to mitigate potential future losses but also highlights the inherent credit risks in the loan portfolio.
Noninterest Income: Noninterest income decreased by $169,000 in Q4 compared to the prior quarter, primarily due to a $101,000 loss on the sale of lower-yielding investment securities. This reduction could impact overall profitability.
Noninterest Expense: Noninterest expense for Q4 increased by $1.0 million compared to the prior quarter, driven by higher compensation and benefits, professional fees, and an impairment loss on repossessed assets. These rising costs could pressure margins.
Investment Portfolio Losses: Pretax unrealized net losses on the investment portfolio totaled $7.5 million as of December 31, 2025, which could affect the company's financial stability if market conditions worsen.
Deposit Costs: The average rate on interest-bearing deposits decreased to 2.06%, but the company remains exposed to potential increases in funding costs if interest rates rise.
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Guidance & Outlook
Future Investments: The company plans to continue investing in its talented associates and making strategic investments to better serve customers and capitalize on growth opportunities in its markets.
Loan Portfolio Management: The company will maintain proactive monitoring of the credit quality of its loan portfolio to identify emerging risks and minimize future losses.
Market Conditions: The Kansas economy remains healthy with a 3.8% unemployment rate as of November 2025. Housing market conditions are normalizing with increased active listings and a median sale price of $277,000.
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Shareholder Return Plan
Cash Dividend: The Board of Directors declared a cash dividend of $0.21 per share to be paid on February 26, 2026, to shareholders of record as of February 12, 2026.
Dividend History: This represents the 98th consecutive quarterly cash dividend since the parent company's formation in 2001.
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Key Q&A
Q:Review of Unclear Management Responses
A:
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Bancorp Full
Bancorp remark
CEO Wendel
CFO Investor
CFO Treasurer
Chief Hello
Chief McLanahan
Form
Investor Relations
Secretary CFO
VP Secretary
balance sheet
compensation benefit
conference
core deposit
cost deposit
date
dedication
deposit cost
deposit increase
effort
end loan
income share
increase compensation
increase deposit
loan end
loan production
offs charge
portfolio loan
price
pricing discipline
risk loan
tax rate
unit
yesterday
LARK Transcript
Landmark Bancorp, Inc. (LARK) Q4 2025 Earnings Call Prepared Remarks Transcript
Unknown1-29
The earnings call presents a mixed picture: strong financial performance with increased net income and EPS, but concerns over nonperforming loans and increased expenses. The Q&A section did not provide additional insights to alter the sentiment. The dividend declaration is positive, but noninterest income decline and investment portfolio losses pose risks. Overall, the positive financial metrics are balanced by credit risks and expense pressures, leading to a neutral stock price prediction.
Landmark Bancorp, Inc. (LARK) Q3 2025 Earnings Call Transcript
Unknown10-30
The earnings call summary presents a mixed outlook. Financial performance shows improvements in net income and returns, but loan portfolio risks and increased charge-offs are concerning. Dividend declarations are positive, but rising costs and interest rate pressures pose challenges. The absence of Q&A questions limits additional insights. Overall, the sentiment is neutral, with no strong catalysts for significant stock price movement.
Landmark Bancorp, Inc. (LARK) Q2 2025 Earnings Call Transcript
Unknown7-25
The earnings report shows strong financial performance with increased net income and EPS, but concerns arise from increased nonperforming loans, deposit decline, and economic uncertainties. The Q&A session highlighted efforts to improve deposit levels and manage nonperforming loans. While financial metrics are strong, risks and uncertainties balance the positive aspects, leading to a neutral sentiment.
Landmark Bancorp, Inc. (LARK) Q1 2025 Earnings Call Transcript
Positive5-2
The earnings call reflects strong financial performance with significant growth in net income and EPS, improved net interest margin, and operational efficiency. The declared dividend supports positive shareholder sentiment. Despite some risks, such as economic uncertainty and credit quality concerns, the overall outlook is optimistic with healthy economic conditions in Kansas. The Q&A session did not reveal any major concerns, further solidifying a positive sentiment. Therefore, the stock price is likely to see a positive movement of 2% to 8% over the next two weeks.
LARK Report
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