Horizon Bancorp, Inc. Reports Strong Second Quarter 2025 Results Led by Continued Net Interest Margin Expansion

Rhea-AI Summary

Horizon Bancorp (NASDAQ:HBNC) reported strong Q2 2025 financial results with net income of $20.6 million, or $0.47 per diluted share. The quarter marked the seventh consecutive quarter of net interest margin expansion, reaching 3.23%.

Key highlights include a 5.9% increase in net interest income to $55.4 million compared to Q1 2025, strong organic commercial loan growth of $117.2 million (14.8% annualized), and excellent credit quality with annualized net charge-offs of just 0.02%. The company's efficiency ratio improved to 59.48%, while maintaining stable non-time deposit balances and reducing interest-bearing liability costs.

For the first six months of 2025, earnings per share grew 58% compared to the same period in 2024, demonstrating continued momentum in key performance metrics including ROAA and ROATCE.

Positive

• Net interest margin expanded for seventh consecutive quarter to 3.23%
• Strong organic commercial loan growth of $117.2 million (14.8% annualized)
• Excellent credit quality with minimal net charge-offs of 0.02% annualized
• 58% year-over-year growth in earnings per share for first half of 2025
• Non-time deposit balances remained stable with declining interest-bearing liability costs
• Total equity to assets ratio improved to 10.34% from 10.18% in previous quarter

Negative

• Net income decreased to $20.6 million from $23.9 million in Q1 2025
• Total deposits declined by $66.0 million (1.1%) quarter-over-quarter
• Time deposits decreased by $51.9 million (4.2%)
• Total borrowings increased by $68.1 million during the quarter

Insights

Banking Financial Analyst

HBNC posts solid Q2 with 47% YoY EPS growth, seventh consecutive NIM expansion, and strong credit quality amid balanced loan growth.

Horizon Bancorp delivered robust second quarter results with net income of $20.6 million ($0.47 per share), representing a substantial 47% increase from $14.1 million ($0.32 per share) in Q2 2024. While earnings declined sequentially from Q1's $23.9 million, the previous quarter included a $7.0 million one-time gain from the sale of their mortgage warehouse business.

The standout metric is Horizon's net interest margin (NIM), which expanded for the seventh consecutive quarter to 3.23% - up significantly from 2.64% a year ago. This 59 basis point year-over-year expansion has driven a 22.3% increase in net interest income to $55.4 million. Approximately 7 basis points of this quarter's NIM improvement came from interest recoveries, suggesting underlying NIM strength even without this benefit.

Loan growth shows management's strategic focus, with total loans increasing at a 6.2% annualized rate compared to Q1. This was driven by strong commercial loan growth of $117.2 million (14.8% annualized), partially offset by the planned runoff of lower-yielding indirect auto loans ($34.1 million).

Credit quality remains exceptional with annualized net charge-offs of just 0.02% of average loans - well below industry averages. Non-performing assets decreased 12.4% from the previous quarter to just 0.36% of total assets, while the allowance for credit losses increased slightly to 1.09% of loans.

On the liability side, Horizon maintained stable core deposits while reducing higher-cost time deposits by $51.9 million (4.2%). This deposit mix shift combined with disciplined pricing contributed to a 2 basis point reduction in interest-bearing liability costs - a notable achievement in the current rate environment.

Expense management remains disciplined with non-interest expenses increasing less than 1% quarter-over-quarter. The efficiency ratio of 59.48%, while up slightly from Q1's 57.16%, represents significant improvement from 67.29% a year ago.

Capital levels continue to strengthen with tangible common equity to tangible assets improving to 8.37% from 8.19% in Q1. Tangible book value per share increased $0.36 to $14.32, reflecting strong earnings retention.

With first-half EPS of $1.01 representing 58% growth over the same period last year, Horizon has demonstrated meaningful improvement in profitability while maintaining strong asset quality and capital levels.

MICHIGAN CITY, Ind., July 23, 2025 (GLOBE NEWSWIRE) -- (NASDAQ GS: HBNC) – Horizon Bancorp, Inc. (“Horizon” or the “Company”), the parent company of Horizon Bank (the “Bank”), announced its unaudited financial results for the three months ended June 30, 2025.

“Horizon’s second quarter earnings reflect the strength of the organization’s exceptional core community banking franchise. Strong loan growth, stable and granular core funding, excellent credit quality and prudent management of expenses fueled the quarter’s positive results and expanded on management’s commitment to improve the financial performance of the Company. The quarter was highlighted by a seventh consecutive quarter of net interest margin expansion, low net charge offs of 2 bps annualized and enhanced momentum in key performance metrics of ROAA and ROATCE", President and CEO, Thomas Prame stated. “We continue to show strength across our core community banking platform that is being driven by a disciplined approach to creating a more efficient balance sheet and effective deployment of capital. We are pleased with our results through the first six months of 2025, with reported earnings per share growing by 58% versus the comparable period a year ago, and look forward to continuing to create additional shareholder value throughout the remainder of the year.”

Net income for the three months ended June 30, 2025 was $20.6 million, or $0.47 per diluted share, compared to net income of $23.9 million, or $0.54, for the first quarter of 2025 and compared to net income of $14.1 million, or $0.32 per diluted share, for the second quarter of 2024. As previously disclosed, results in the first quarter of 2025 included the $7.0 million pre-tax gain on the sale of the Company's mortgage warehouse business.

Net income for the six months ended June 30, 2025 was $44.6 million, or $1.01 per diluted share, compared to net income of $28.1 million, or $0.64, for the six months ended June 30, 2024.

Second Quarter 2025 Highlights

• Net interest income of $55.4 million increased 5.9% compared with $52.3 million for the three months ended March 31, 2025, and 22.3% compared with $45.3 million in the year ago period. Net interest margin, on a fully taxable equivalent ("FTE") basis¹, expanded for the seventh consecutive quarter, to 3.23%, compared with 3.04% for the three months ended March 31, 2025 and 2.64% for the three months ended June 30, 2024.

• Total loans held for investment ("HFI") increased 6.2% compared to the linked quarter annualized, with strong organic commercial loan growth of $117.2 million, or 14.8% annualized. This growth was partially funded by the continued strategic runoff of lower yielding indirect auto loans of approximately $34.1 million.

• Funding continued to trend favorably, with non-time deposit balances remaining relatively flat for the fourth consecutive quarter and interest-bearing liability cost declining by another 2 bps during the quarter.

• Credit quality remained strong, with annualized net charge offs of 0.02% of average loans during the second quarter. Non-performing assets remain well within expected ranges, decreasing 12.4% from the prior quarter.

• Expenses continued to be well managed, up less than 1% from the first quarter of 2025. These results reflect management's commitment to generate higher earnings while maintaining a more efficient expense base.

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1} Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

	Financial Highlights
	(Dollars in Thousands Except Share and Per Share Data and Ratios)
	Three Months Ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2025				2025				2024				2024				2024
Income statement:
Net interest income	$	55,354			$	52,267			$	53,127			$	46,910			$	45,279
Provision for credit loss expense		2,462				1,376				1,171				1,044				2,369
Non-interest income (loss)		10,920				16,499				(28,954	)			11,511				10,485
Non-interest expense		39,417				39,306				44,935				39,272				37,522
Income tax expense (benefit)		3,752				4,141				(11,051	)			(75	)			1,733
Net Income (Loss)	$	20,643			$	23,943			$	(10,882	)		$	18,180			$	14,140
Per share data:
Basic earnings (loss) per share	$	0.47			$	0.55			$	(0.25	)		$	0.42			$	0.32
Diluted earnings (loss) per share		0.47				0.54				(0.25	)			0.41				0.32
Cash dividends declared per common share		0.16				0.16				0.16				0.16				0.16
Book value per common share		18.06				17.72				17.46				17.27				16.62
Market value - high		15.88				17.76				18.76				16.57				12.74
Market value - low		12.92				15.00				14.57				11.89				11.29
Weighted average shares outstanding - Basic		43,794,490				43,777,109				43,721,211				43,712,059				43,712,059
Weighted average shares outstanding - Diluted		44,034,663				43,954,164				43,721,211				44,112,321				43,987,187
Common shares outstanding (end of period)		43,801,507				43,785,932				43,722,086				43,712,059				43,712,059
Key ratios:
Return on average assets		1.08	%			1.25	%		(0.56		)%			0.92	%			0.73	%
Return on average stockholders' equity		13.24				12.44				(5.73	)			9.80				7.83
Total equity to total assets		10.34				10.18				9.79				9.52				9.18
Total loans to deposit ratio		87.52				85.21				87.75				83.92				85.70
Allowance for credit losses to HFI loans		1.09				1.07				1.07				1.10				1.08
Annualized net charge-offs of average total loans (1)		0.02				0.07				0.05				0.03				0.05
Efficiency ratio		59.48				57.16				185.89				67.22				67.29
Key metrics (Non-GAAP) (2)
Net FTE interest margin		3.23	%			3.04	%			2.97	%			2.66	%			2.64	%
Return on average tangible common equity		13.24				15.79				(7.35	)			12.65				10.18
Tangible common equity to tangible assets		8.37				8.19				7.83				7.58				7.22
Tangible book value per common share	$	14.32			$	13.96			$	13.68			$	13.46			$	12.80
(1) Average total loans includes loans held for investment and held for sale.
(2) Non-GAAP financial metrics. See non-GAAP reconciliation included herein for the most directly comparable GAAP measures.

Income Statement Highlights

Net Interest Income

Net interest income was $55.4 million in the second quarter of 2025, compared to $52.3 million in the first quarter of 2025, driven by the continued expansion of the Company's net FTE interest margin¹, which increased to 3.23% for the second quarter of 2025, compared to 3.04% for the first quarter of 2025. Expansion was attributable to the favorable mix shift in average interest earning assets toward higher-yielding loans and in the average funding mix toward deposit balances, in addition to continued disciplined pricing strategies on both sides of the balance sheet. The second quarter net FTE interest margin did benefit by approximately seven basis points related to interest recoveries on certain commercial and residential loans.

Provision for Credit Losses

During the second quarter of 2025, the Company recorded a provision for credit losses of $2.5 million. This compares to a provision for credit losses of $1.4 million during the first quarter of 2025, and $2.4 million during the second quarter of 2024. The increase in the provision for credit losses during the second quarter of 2025 when compared with the first quarter of 2025 was primarily attributable to net growth in commercial loans HFI and changes in economic factors, partially offset by the reduction of specific reserves and the reserves for unfunded commitments in the current quarter.

For the second quarter of 2025, the allowance for credit losses included net charge-offs of $0.3 million, or an annualized 0.02% of average loans outstanding, compared to net charge-offs of $0.9 million, or an annualized 0.07% of average loans outstanding for the first quarter of 2025, and net charge-offs of $0.6 million, or an annualized 0.05% of average loans outstanding, in the second quarter of 2024.

The Company’s allowance for credit losses as a percentage of period-end loans HFI was 1.09% at June 30, 2025, compared to 1.07% at March 31, 2025 and 1.08% at June 30, 2024.

Non-Interest Income

For the Quarter Ended	June 30,				March 31,				December 31,				September 30,				June 30,
(Dollars in Thousands)	2025				2025				2024				2024				2024
Non-interest Income
Service charges on deposit accounts	$	3,208			$	3,208			$	3,276			$	3,320			$	3,130
Wire transfer fees		69				71				124				123				113
Interchange fees		3,403				3,241				3,353				3,511				3,826
Fiduciary activities		1,251				1,326				1,313				1,394				1,372
Loss on sale of investment securities		—				(407	)			(39,140	)			—				—
Gain on sale of mortgage loans		1,219				1,076				1,071				1,622				896
Mortgage servicing income net of impairment		375				385				376				412				450
Increase in cash value of bank owned life insurance		346				335				335				349				318
Other income		1,049				7,264				338				780				380
Total non-interest income (loss)	$	10,920			$	16,499			$	(28,954	)		$	11,511			$	10,485

Total non-interest income was $10.9 million in the second quarter of 2025, compared to non-interest income of $16.5 million in the first quarter of 2025. The decrease in non-interest income of $5.6 million is due to the sale of the Company's mortgage warehouse business to an unrelated third party in the first quarter of 2025, resulting in a pre-tax gain of $7.0 million that did not recur in the current period. Interchange fees and gain on sale of mortgage loans benefited from normal seasonality, while other categories remained relatively unchanged when compared with the prior period.

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1} Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

Non-Interest Expense

For the Quarter Ended	June 30,				March 31,				December 31,				September 30,				June 30,
(Dollars in Thousands)	2025				2025				2024				2024				2024
Non-interest Expense
Salaries and employee benefits	$	22,731			$	22,414			$	25,564			$	21,829			$	20,583
Net occupancy expenses		3,127				3,702				3,431				3,207				3,192
Data processing		2,951				2,872				2,841				2,977				2,579
Professional fees		735				826				736				676				714
Outside services and consultants		3,278				3,265				4,470				3,677				3,058
Loan expense		1,231				689				1,285				1,034				1,038
FDIC insurance expense		1,216				1,288				1,193				1,204				1,315
Core deposit intangible amortization		816				816				843				844				844
Merger related expenses		—				305				—				—				—
Other losses		245				228				371				297				515
Other expense		3,087				2,901				4,201				3,527				3,684
Total non-interest expense	$	39,417			$	39,306			$	44,935			$	39,272			$	37,522

Total non-interest expense was $39.4 million in the second quarter of 2025, compared with $39.3 million in the first quarter of 2025. The increase in non-interest expense during the second quarter of 2025 when compared with the prior period was primarily driven by a $0.5 million increase in loan expense. The increase was partially offset by a $0.6 million decrease in net occupancy expenses. Additionally, the Company incurred $0.3 million of direct expenses related to the sale of the mortgage warehouse business in the prior period that did not recur in the current period.   

Income Taxes

Horizon recorded a net tax expense of $3.8 million for the second quarter of 2025, representing an effective tax rate of 15.4%, which is consistent with the Company's estimated annual effective tax rate.

Balance Sheet Highlights

Total assets increased by $23.4 million, or 0.3%, to $7.7 billion as of June 30, 2025, from $7.6 billion as of March 31, 2025. The increase in total assets is primarily due to increases in loans HFI and non-interest earning cash, partially offset by a decrease in interest earning cash and investment securities. Total investment securities decreased by $24.2 million, or 1.2%, to $2.1 billion as of June 30, 2025. Total loans were $5.0 billion at June 30, 2025, an increase of $75.5 million from March 31, 2025 balances, due to organic commercial loan growth net of continued runoff in the indirect consumer portfolio.

Total deposits decreased by $66.0 million, or 1.1%, to $5.7 billion as of June 30, 2025 when compared to balances as of March 31, 2025. The decrease was partially related to a decline in time deposits of $51.9 million, or 4.2% and, to a lesser extent, a modest decrease in savings and money market deposits of $7.0 million, or 0.4%. Non-interest bearing deposit balances remained relatively unchanged in the current period. Total borrowings increased by $68.1 million during the quarter, to $880.3 million as of June 30, 2025. Balances subject to repurchase agreements increased by $7.2 million, to $95.1 million.

Capital

The following table presents the consolidated regulatory capital ratios of the Company for the previous three quarters, and the Company’s preliminary estimate of its consolidated regulatory capital ratios for the quarter ended June 30, 2025:

For the Quarter Ended	June 30,				March 31,				December 31,				September 30,
	2025*				2025				2024				2024
Consolidated Capital Ratios
Total capital (to risk-weighted assets)		14.48	%			14.26	%			13.91	%			13.45	%
Tier 1 capital (to risk-weighted assets)		12.52				12.33				12.00				11.63
Common equity tier 1 capital (to risk-weighted assets)		11.52				11.32				11.00				10.68
Tier 1 capital (to average assets)		9.59				9.25				8.88				9.02
*Preliminary estimate - may be subject to change

As of June 30, 2025, the ratio of total stockholders’ equity to total assets is 10.34%. Book value per common share was $18.06, increasing $0.34 during the second quarter of 2025.

Tangible common equity³ totaled $627.1 million at June 30, 2025, and the ratio of tangible common equity to tangible assets¹ was 8.37% at June 30, 2025, up from 8.19% at March 31, 2025. Tangible book value, which excludes intangible assets from total equity, per common share¹ was $14.32, increasing $0.36 during the second quarter of 2025 behind the growth in retained earnings.

Credit Quality

As of June 30, 2025, total non-accrual loans decreased by $4.5 million, or 15.7%, from March 31, 2025, to 0.49% of total loans HFI. Total non-performing assets decreased $3.9 million, or 12.4%, to $27.5 million, compared to $31.4 million as of March 31, 2025. The ratio of non-performing assets to total assets decreased to 0.36% compared to 0.41% as of March 31, 2025.

As of June 30, 2025, net charge-offs decreased by $0.6 million to $0.3 million, compared to $0.9 million as of March 31, 2025 and remain just 0.02% annualized of average loans.

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1} Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

Earnings Conference Call

As previously announced, Horizon will host a conference call to review its second quarter financial results and operating performance.

Participants may access the live conference call on July 24, 2025 at 7:30 a.m. CT (8:30 a.m. ET) by dialing 833-974-2379 from the United States, 866-450-4696 from Canada or 1-412-317-5772 from international locations and requesting the “Horizon Bancorp, Inc. Call.” Participants are asked to dial in approximately 10 minutes prior to the call.

A telephone replay of the call will be available approximately one hour after the end of the conference through August 1, 2025. The replay may be accessed by dialing 877-344-7529 from the United States, 855-669-9658 from Canada or 1–412–317-0088 from other international locations, and entering the access code 5878909.

About Horizon Bancorp, Inc.

Horizon Bancorp, Inc. (NASDAQ GS: HBNC) is the $7.7 billion-asset commercial bank holding company for Horizon Bank, which serves customers across diverse and economically attractive Midwestern markets through convenient digital and virtual tools, as well as its Indiana and Michigan branches. Horizon's retail offerings include prime residential and other secured consumer lending to in-market customers, as well as a range of personal banking and wealth management solutions. Horizon also provides a comprehensive array of in-market business banking and treasury management services, as well as equipment financing solutions for customers regionally and nationally, with commercial lending representing over half of total loans. More information on Horizon, headquartered in Northwest Indiana's Michigan City, is available at horizonbank.com and investor.horizonbank.com.

Use of Non-GAAP Financial Measures

Certain information set forth in this press release refers to financial measures determined by methods other than in accordance with GAAP. Specifically, we have included non-GAAP financial measures relating to net income, diluted earnings per share, pre-tax, pre-provision net income, net interest margin, tangible stockholders’ equity and tangible book value per share, efficiency ratio, the return on average assets, the return on average common equity, and return on average tangible equity. In each case, we have identified special circumstances that we consider to be non-recurring and have excluded them. Horizon believes these non-GAAP financial measures are helpful to investors and provide a greater understanding of our business and financial results without giving effect to one-time costs and non–recurring items. These measures are not necessarily comparable to similar measures that may be presented by other companies and should not be considered in isolation or as a substitute for the related GAAP measure. See the tables and other information below and contained elsewhere in this press release for reconciliations of the non-GAAP information identified herein and its most comparable GAAP measures.

Forward Looking Statements

This press release may contain forward–looking statements regarding the financial performance, business prospects, growth and operating strategies of Horizon Bancorp, Inc. and its affiliates (collectively, “Horizon”). For these statements, Horizon claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this press release should be considered in conjunction with the other information available about Horizon, including the information in the filings we make with the Securities and Exchange Commission (the “SEC”). Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance.

Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include: effects on Horizon’s business resulting from new U.S. domestic or foreign governmental trade measures, including but not limited to tariffs, import and export controls, foreign exchange intervention accomplished to offset the effects of trade policy or in response to currency volatility, and other restrictions on free trade; uncertain conditions within the domestic and international macroeconomic environment, including trade policy, monetary and fiscal policy, and conditions in the investment, credit, interest rate, and derivatives markets, and their impact on Horizon and its customers; current financial conditions within the banking industry; changes in the level and volatility of interest rates, changes in spreads on earning assets and changes in interest bearing liabilities; increased interest rate sensitivity; the aggregate effects of elevated inflation levels in recent years; loss of key Horizon personnel; increases in disintermediation; potential loss of fee income, including interchange fees, as new and emerging alternative payment platforms take a greater market share of the payment systems; estimates of fair value of certain of Horizon’s assets and liabilities; changes in prepayment speeds, loan originations, credit losses, market values, collateral securing loans and other assets; changes in sources of liquidity; legislative and regulatory actions and reforms; changes in accounting policies or procedures as may be adopted and required by regulatory agencies; litigation, regulatory enforcement, and legal compliance risk and costs; rapid technological developments and changes; cyber terrorism and data security breaches; the rising costs of cybersecurity; the ability of the U.S. federal government to manage federal debt limits; climate change and social justice initiatives; the inability to realize cost savings or revenues or to effectively implement integration plans and other consequences associated with mergers, acquisitions, and divestitures; acts of terrorism, war and global conflicts, such as the Russia and Ukraine conflict and the Israel and Hamas conflict; and supply chain disruptions and delays. These and additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in Horizon’s reports (such as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K) filed with the SEC and available at the SEC’s website (www.sec.gov). Undue reliance should not be placed on the forward–looking statements, which speak only as of the date hereof. Horizon does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward–looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.

	Condensed Consolidated Statements of Income
	(Dollars in Thousands Except Per Share Data, Unaudited)
	Three Months Ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2025				2025				2024				2024				2024
Interest Income
Loans receivable	$	78,618			$	74,457			$	76,747			$	75,488			$	71,880
Investment securities - taxable		5,941				6,039				6,814				8,133				7,986
Investment securities - tax-exempt		6,088				6,192				6,301				6,310				6,377
Other		830				2,487				3,488				957				738
Total interest income		91,477				89,175				93,350				90,888				86,981
Interest Expense
Deposits		26,053				25,601				27,818				30,787				28,447
Borrowed funds		8,171				9,188				10,656				11,131				11,213
Subordinated notes		829				829				829				830				829
Junior subordinated debentures issued to capital trusts		1,070				1,290				920				1,230				1,213
Total interest expense		36,123				36,908				40,223				43,978				41,702
Net Interest Income		55,354				52,267				53,127				46,910				45,279
Provision for credit loss expense		2,462				1,376				1,171				1,044				2,369
Net Interest Income after Provision for Credit Losses		52,892				50,891				51,956				45,866				42,910
Non-interest Income
Service charges on deposit accounts		3,208				3,208				3,276				3,320				3,130
Wire transfer fees		69				71				124				123				113
Interchange fees		3,403				3,241				3,353				3,511				3,826
Fiduciary activities		1,251				1,326				1,313				1,394				1,372
Gains (losses) on sale of investment securities		—				(407	)			(39,140	)			—				—
Gain on sale of mortgage loans		1,219				1,076				1,071				1,622				896
Mortgage servicing income net of impairment		375				385				376				412				450
Increase in cash value of bank owned life insurance		346				335				335				349				318
Other income		1,049				7,264				338				780				380
Total non-interest income (loss)		10,920				16,499				(28,954	)			11,511				10,485
Non-interest Expense
Salaries and employee benefits		22,731				22,414				25,564				21,829				20,583
Net occupancy expenses		3,127				3,702				3,431				3,207				3,192
Data processing		2,951				2,872				2,841				2,977				2,579
Professional fees		735				826				736				676				714
Outside services and consultants		3,278				3,265				4,470				3,677				3,058
Loan expense		1,231				689				1,285				1,034				1,038
FDIC insurance expense		1,216				1,288				1,193				1,204				1,315
Core deposit intangible amortization		816				816				843				844				844
Merger related expenses		—				305				—				—				—
Other losses		245				228				371				297				515
Other expense		3,087				2,901				4,201				3,527				3,684
Total non-interest expense		39,417				39,306				44,935				39,272				37,522
Income (Loss) Before Income Taxes		24,395				28,084				(21,933	)			18,105				15,873
Income tax expense (benefit)		3,752				4,141				(11,051	)			(75	)			1,733
Net Income (Loss)	$	20,643			$	23,943			$	(10,882	)		$	18,180			$	14,140
Basic Earnings (Loss) Per Share	$	0.47			$	0.55			$	(0.25	)		$	0.42			$	0.32
Diluted Earnings (Loss) Per Share		0.47				0.54				(0.25	)			0.41				0.32

	Condensed Consolidated Balance Sheet
	(Dollars in Thousands, Unaudited)
	Three Months Ended for the Period
	June 30,				March 31,				December 31,				September 30,				June 30,
	2025				2025				2024				2024				2024
Assets
Interest earning assets
Federal funds sold	$	2,024			$	—			$	—			$	113,912			$	34,453
Interest earning deposits		34,174				80,023				201,131				12,107				4,957
Interest earning time deposits		—				—				735				735				1,715
Federal Home Loan Bank stock		45,412				45,412				53,826				53,826				53,826
Investment securities, available for sale		231,999				231,431				233,677				541,170				527,054
Investment securities, held to maturity		1,819,087				1,843,851				1,867,690				1,888,379				1,904,281
Loans held for sale		2,994				3,253				67,597				2,069				2,440
Gross loans held for investment (HFI)		4,985,582				4,909,815				4,847,040				4,803,996				4,822,840
Total Interest earning assets		7,121,272				7,113,784				7,271,696				7,416,194				7,351,566
Non-interest earning assets
Allowance for credit losses		(54,399	)			(52,654	)			(51,980	)			(52,881	)			(52,215	)
Cash		101,719				89,643				92,300				108,815				106,691
Cash value of life insurance		37,755				37,409				37,450				37,115				36,773
Other assets		148,773				143,675				152,635				119,026				165,656
Goodwill		155,211				155,211				155,211				155,211				155,211
Other intangible assets		8,592				9,407				10,223				11,067				11,910
Premises and equipment, net		93,398				93,499				93,864				93,544				93,695
Interest receivable		39,730				38,663				39,747				39,366				43,240
Total non-interest earning assets		530,779				514,855				529,450				511,263				560,961
Total assets	$	7,652,051			$	7,628,639			$	7,801,146			$	7,927,457			$	7,912,526
Liabilities
Savings and money market deposits	$	3,385,413			$	3,393,371			$	3,446,681			$	3,420,827			$	3,364,726
Time deposits		1,193,180				1,245,088				1,089,153				1,220,653				1,178,389
Borrowings		880,336				812,218				1,142,340				1,142,744				1,229,165
Repurchase agreements		95,089				87,851				89,912				122,399				128,169
Subordinated notes		55,807				55,772				55,738				55,703				55,668
Junior subordinated debentures issued to capital trusts		57,583				57,531				57,477				57,423				57,369
Total interest earning liabilities		5,667,408				5,651,832				5,881,301				6,019,749				6,013,486
Non-interest bearing deposits		1,121,163				1,127,324				1,064,818				1,085,535				1,087,040
Interest payable		14,007				11,441				11,137				11,400				11,240
Other liabilities		58,621				61,981				80,308				55,951				74,096
Total liabilities		6,861,199				6,852,578				7,037,564				7,172,635				7,185,862
Stockholders’ Equity
Preferred stock		—				—				—				—				—
Common stock		—				—				—				—				—
Additional paid-in capital		360,758				360,522				363,761				358,453				357,673
Retained earnings		466,497				452,945				436,122				454,050				442,977
Accumulated other comprehensive (loss)		(36,403	)			(37,406	)			(36,301	)			(57,681	)			(73,985	)
Total stockholders’ equity		790,852				776,061				763,582				754,822				726,665
Total liabilities and stockholders’ equity	$	7,652,051			$	7,628,639			$	7,801,146			$	7,927,457			$	7,912,527

	Loans and Deposits
	(Dollars in Thousands, Unaudited)
	June 30,				March 31,				December 31,				September 30,				June 30,				% Change
	2025				2025				2024				2024				2024				Q2'25 vs Q1'25				Q2'25 vs Q2'24
Loans:
Commercial real estate	$	2,321,951			$	2,262,910			$	2,202,858			$	2,105,459			$	2,117,772				3	%			10	%
Commercial & Industrial		976,740				918,541				875,297				808,600				786,788				6	%			24	%
Total commercial		3,298,691				3,181,451				3,078,155				2,914,059				2,904,560				4	%			14	%
Residential Real estate		786,026				801,726				802,909				801,356				797,956				(2	)%			(1	)%
Mortgage warehouse		—				—				—				80,437				68,917				—	%			(100	)%
Consumer		900,865				926,638				965,976				1,008,144				1,051,407				(3	)%			(14	)%
Total loans held for investment		4,985,582				4,909,815				4,847,040				4,803,996				4,822,840				2	%			3	%
Loans held for sale		2,994				3,253				67,597				2,069				2,440				(8	)%			23	%
Total loans	$	4,988,576			$	4,913,068			$	4,914,637			$	4,806,065			$	4,825,280				2	%			3	%
Deposits:
Interest bearing deposits	$	1,713,058			$	1,713,991			$	1,767,983			$	1,688,998			$	1,653,508				—	%			4	%
Savings and money market deposits		1,672,355				1,679,380				1,678,697				1,731,830				1,711,218				—	%			(2	)%
Time deposits		1,193,180				1,245,088				1,089,153				1,220,653				1,178,389				(4	)%			1	%
Total Interest bearing deposits		4,578,593				4,638,459				4,535,833				4,641,481				4,543,115				(1	)%			1	%
Non-interest bearing deposits
Non-interest bearing deposits		1,121,164				1,127,324				1,064,819				1,085,534				1,087,040				(1	)%			3	%
Total deposits	$	5,699,757			$	5,765,784			$	5,600,652			$	5,727,015			$	5,630,155				(1	)%			1	%

	Average Balance Sheet
	(Dollars in Thousands, Unaudited)
	Three Months Ended
	June 30, 2025									March 31, 2025									June 30, 2024
	Average Balance			Interest(4)(6)			Average Rate(4)			Average Balance			Interest(4)(6)			Average Rate(4)			Average Balance			Interest(4)(6)			Average Rate(4)
Assets
Interest earning assets
Interest earning deposits (incl. Fed Funds Sold)	$	72,993		$	830			4.56	%	$	223,148		$	2,487			4.52	%	$	55,467		$	738			5.35	%
Federal Home Loan Bank stock		45,412			1,075			9.49	%		51,769			1,012			7.93	%		53,827			1,521			11.36	%
Investment securities - taxable (1)		959,238			4,867			2.03	%		974,109			5,027			2.09	%		1,309,305			6,465			1.99	%
Investment securities - non-taxable (1)		1,100,731			7,706			2.81	%		1,120,249			7,838			2.84	%		1,132,065			8,072			2.87	%
Total investment securities		2,059,969			12,573			2.45	%		2,094,358			12,865			2.49	%		2,441,370			14,537			2.39	%
Loans receivable (2) (3)		4,947,093			79,000			6.41	%		4,865,449			74,840			6.24	%		4,662,124			72,208			6.23	%
Total interest earning assets		7,125,467			93,478			5.26	%		7,234,724			91,204			5.11	%		7,212,788			89,004			4.96	%
Non-interest earning assets
Cash and due from banks		86,316									88,624									108,319
Allowance for credit losses		(52,560	)								(51,863	)								(50,334	)
Other assets		472,175									483,765									508,555
Total average assets	$	7,631,398								$	7,755,250								$	7,779,328
Liabilities and Stockholders' Equity
Interest bearing liabilities
Interest bearing demand deposits	$	1,727,713		$	6,803			1.58	%	$	1,750,446		$	6,491			1.50	%	$	1,656,523		$	7,081			1.72	%
Saving and money market deposits		1,651,866			8,200			1.99	%		1,674,590			8,263			2.00	%		1,677,967			9,733			2.33	%
Time deposits		1,233,582			11,050			3.59	%		1,212,386			10,847			3.63	%		1,134,590			11,633			4.12	%
Total Deposits		4,613,161			26,053			2.27	%		4,637,422			25,601			2.24	%		4,469,080			28,447			2.56	%
Borrowings		847,862			7,777			3.68	%		971,496			8,772			3.66	%		1,184,172			10,278			3.49	%
Repurchase agreements		88,058			394			1.79	%		88,469			416			1.91	%		125,144			935			3.00	%
Subordinated notes		55,785			829			5.96	%		55,750			829			6.03	%		55,647			829			5.99	%
Junior subordinated debentures issued to capital trusts		57,550			1,070			7.46	%		57,497			1,290			9.10	%		57,335			1,213			8.51	%
Total interest bearing liabilities		5,662,416			36,123			2.56	%		5,810,634			36,908			2.58	%		5,891,378			41,702			2.85	%
Non-interest bearing liabilities
Demand deposits		1,114,982									1,085,826									1,080,676
Accrued interest payable and other liabilities		64,465									78,521									80,942
Stockholders' equity		789,535									780,269									726,332
Total average liabilities and stockholders' equity	$	7,631,398								$	7,755,250								$	7,779,328
Net FTE interest income (non-GAAP) (5)				$	57,355								$	54,296								$	47,302
Less FTE adjustments (4)					2,001									2,029									2,023
Net Interest Income				$	55,354								$	52,267								$	45,279
Net FTE interest margin (Non-GAAP) (4)(5)								3.23	%								3.04	%								2.64	%
(1) Securities balances represent daily average balances for the fair value of securities. The average rate is calculated based on the daily average balance for the amortized cost of securities.
(2) Includes fees on loans held for sale and held for investment. The inclusion of loan fees does not have a material effect on the average interest rate.
(3) Non-accruing loans for the purpose of the computation above are included in the daily average loan amounts outstanding. Loan totals are shown net of unearned income and deferred loan fees.
(4) Management believes fully taxable equivalent, or FTE, interest income is useful to investors in evaluating the Company's performance as a comparison of the returns between a tax-free investment and a taxable alternative. The Company adjusts interest income and average rates for tax-exempt loans and securities to an FTE basis utilizing a 21% tax rate.
(5) Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.
(6) Includes dividend income on Federal Home Loan Bank stock

	Credit Quality
	(Dollars in Thousands Except Ratios, Unaudited)
	Quarter Ended
	June 30,				March 31,				December 31,				September 30,				June 30,				% Change
	2025				2025				2024				2024				2024				Q2'25 vs Q1'25				Q2'25 vs Q2'24
Non-accrual loans
Commercial	$	7,547			$	8,172			$	5,658			$	6,830			$	4,321				(8	)%			75	%
Residential Real estate		9,525				12,763				11,215				9,529				8,489				(25	)%			12	%
Mortgage warehouse		—				—				—				—				—				—	%			—	%
Consumer		7,222				7,875				8,919				7,208				5,453				(8	)%			32	%
Total non-accrual loans		24,294				28,810				25,792				23,567				18,263				(16	)%			33	%
90 days and greater delinquent - accruing interest		2,113				1,582				1,166				819				1,039				34	%			103	%
Total non-performing loans	$	26,407			$	30,392			$	26,958			$	24,386			$	19,302				(13	)%			37	%
Other real estate owned
Commercial	$	176			$	360			$	407			$	1,158			$	1,111				(51	)%			(84	)%
Residential Real estate		463				641				—				—				—				—	%			—	%
Mortgage warehouse		—				—				—				—				—				—	%			—	%
Consumer		480				34				17				36				57				1311	%			742	%
Total other real estate owned		1,119				1,035				424				1,194				1,168				8	%			(4	)%
Total non-performing assets	$	27,526			$	31,427			$	27,382			$	25,580			$	20,470				(12	)%			34	%
Loan data:
Accruing 30 to 89 days past due loans	$	31,401			$	19,034			$	23,075			$	18,087			$	19,785				65	%			59	%
Substandard loans		64,100				66,714				64,535				59,775				51,221				(4	)%			25	%
Net charge-offs (recoveries)
Commercial	$	84			$	(47	)		$	(32	)		$	(52	)		$	57				(279	)%			47	%
Residential Real estate		52				(47	)			(10	)			(9	)			(4	)			(211	)%			(1400	)%
Mortgage warehouse		—				—				—				—				—				—	%			—	%
Consumer		118				963				668				439				534				(88	)%			(78	)%
Total net charge-offs	$	254			$	869			$	626			$	378			$	587				(71	)%			(57	)%
Allowance for credit losses
Commercial	$	34,413			$	32,640			$	30,953			$	32,854			$	31,941				5	%			8	%
Residential Real estate		3,229				3,167				2,715				2,675				2,588				2	%			25	%
Mortgage warehouse		—				—				—				862				736				—	%			(100	)%
Consumer		16,757				16,847				18,312				16,490				16,950				(1	)%			(1	)%
Total allowance for credit losses	$	54,399			$	52,654			$	51,980			$	52,881			$	52,215				3	%			4	%
Credit quality ratios
Non-accrual loans to HFI loans		0.49	%			0.59	%			0.53	%			0.49	%			0.38	%
Non-performing assets to total assets		0.36	%			0.41	%			0.35	%			0.32	%			0.26	%
Annualized net charge-offs of average total loans		0.02	%			0.07	%			0.05	%			0.03	%			0.05	%
Allowance for credit losses to HFI loans		1.09	%			1.07	%			1.07	%			1.10	%			1.08	%

Non–GAAP Reconciliation of Net Fully-Taxable Equivalent ("FTE") Interest Margin
(Dollars in Thousands, Unaudited)
			Three Months Ended
			June 30,				March 31,				December 31,				September 30,				June 30,
			2025				2025				2024				2024				2024
Interest income (GAAP)	(A)		$	91,477			$	89,175			$	93,350			$	90,888			$	86,981
Taxable-equivalent adjustment:
Investment securities - tax exempt (1)				1,619				1,646				1,675				1,677				1,695
Loan receivable (2)				382				383				395				340				328
Interest income (non-GAAP)	(B)			93,478				91,204				95,420				92,905				89,004
Interest expense (GAAP)	(C)			36,123				36,908				40,223				43,978				41,702
Net interest income (GAAP)	(D) =(A) - (C)		$	55,354			$	52,267			$	53,127			$	46,910			$	45,279
Net FTE interest income (non-GAAP)	(E) = (B) - (C)		$	57,355			$	54,296			$	55,197			$	48,927			$	47,302
Average interest earning assets	(F)			7,125,467				7,234,724				7,396,178				7,330,263				7,212,788
Net FTE interest margin (non-GAAP)	(G) = (E*) / (F)			3.23	%			3.04	%			2.97	%			2.66	%			2.64	%
(1) The following represents municipal securities interest income for investment securities classified as available-for-sale and held-to-maturity
(2) The following represents municipal loan interest income for loan receivables classified as held for sale and held for investment
*Annualized

Non–GAAP Reconciliation of Return on Average Tangible Common Equity
(Dollars in Thousands, Unaudited)
			Three Months Ended
			June 30,				March 31,				December 31,				September 30,				June 30,
			2025				2025				2024				2024				2024
Net income (loss) (GAAP)	(A)		$	20,643			$	23,941			$	(10,882	)		$	18,180			$	14,140
Average stockholders' equity	(B)		$	789,535			$	780,269			$	755,340			$	738,372			$	726,332
Average intangible assets	(C)			164,320				165,138				165,973				166,819				167,659
Average tangible equity (Non-GAAP)	(D) = (B) - (C)		$	625,215			$	615,131			$	589,367			$	571,553			$	558,673
Return on average tangible common equity ("ROACE") (non-GAAP)	(E) = (A*) / (D)			13.24	%			15.48	%		(7.35		)%			12.65	%			10.18	%
*Annualized

Non–GAAP Reconciliation of Tangible Common Equity to Tangible Assets
(Dollars in Thousands, Unaudited)
			Three Months Ended
			June 30,				March 31,				December 31,				September 30,				June 30,
			2025				2025				2024				2024				2024
Total stockholders' equity (GAAP)	(A)		$	790,852			$	776,061			$	763,582			$	754,822			$	726,665
Intangible assets (end of period)	(B)			163,802				164,618				165,434				166,278				167,121
Total tangible common equity (non-GAAP)	(C) = (A) - (B)		$	627,050			$	611,443			$	598,148			$	588,544			$	559,544
Total assets (GAAP)	(D)		$	7,652,051			$	7,628,636			$	7,801,146			$	7,927,457			$	7,912,527
Intangible assets (end of period)	(B)			163,802				164,618				165,434				166,278				167,121
Total tangible assets (non-GAAP)	(E) = (D) - (B)		$	7,488,249			$	7,464,018			$	7,635,712			$	7,761,179			$	7,745,406
Tangible common equity to tangible assets (Non-GAAP)	(G) = (C) / (E)			8.37	%			8.19	%			7.83	%			7.58	%			7.22	%

Non–GAAP Reconciliation of Tangible Book Value Per Share
(Dollars in Thousands, Unaudited)
			Three Months Ended
			June 30,				March 31,				December 31,				September 30,				June 30,
			2025				2025				2024				2024				2024
Total stockholders' equity (GAAP)	(A)		$	790,852			$	776,061			$	763,582			$	754,822			$	726,665
Intangible assets (end of period)	(B)			163,802				164,618				165,434				166,278				167,121
Total tangible common equity (non-GAAP)	(C) = (A) - (B)		$	627,050			$	611,443			$	598,148			$	588,544			$	559,544
Common shares outstanding	(D)			43,801,507				43,786,000				43,722,086				43,712,059				43,712,059
Tangible book value per common share (non-GAAP)	(E) = (C) / (D)		$	14.32			$	13.96			$	13.68			$	13.46			$	12.80

Contact:	John R. Stewart, CFA
	EVP, Chief Financial Officer
Phone:	(219) 814–5833
Fax:	(219) 874–9280
Date:	July 23, 2025

FAQ

What were Horizon Bancorp's (HBNC) earnings per share in Q2 2025?

Horizon Bancorp reported earnings of $0.47 per diluted share in Q2 2025, compared to $0.54 in Q1 2025 and $0.32 in Q2 2024.

How did HBNC's net interest margin perform in Q2 2025?

HBNC's net interest margin expanded to 3.23%, marking the seventh consecutive quarter of expansion, up from 3.04% in Q1 2025 and 2.64% in Q2 2024.

What was Horizon Bancorp's loan growth in Q2 2025?

HBNC reported strong organic commercial loan growth of $117.2 million (14.8% annualized), while strategically reducing indirect auto loans by $34.1 million.

How did HBNC's credit quality metrics perform in Q2 2025?

Credit quality remained strong with annualized net charge-offs of just 0.02% of average loans, and non-performing assets decreased 12.4% to $27.5 million (0.36% of total assets).

What was Horizon Bancorp's capital position as of Q2 2025?

HBNC reported a total capital ratio of 14.48% and tangible book value per share of $14.32, with total stockholders' equity to assets ratio of 10.34%.