Unity Bancorp Reports Quarterly Earnings of $11.6 Million

Rhea-AI Summary

Unity Bancorp (NASDAQ: UNTY) reported Q1 2025 net income of $11.6 million, or $1.13 per diluted share, showing a 0.8% increase from Q4 2024's $11.5 million. The company achieved a 1.83% ROA and 15.56% ROE.

Key highlights include strong Commercial and Residential lending growth of $84.5 million (3.74% increase) and customer deposit growth of $90.7 million (4.82% increase) quarter-over-quarter. The bank maintains approximately $2.8 billion in assets and $2.2 billion in deposits.

Unity Bank operates through its branch network across multiple New Jersey counties and Northampton County in Pennsylvania, focusing on retail, corporate, and small business customers while maintaining conservative loan-to-value and debt-service-coverage levels.

Positive

• Net income increased 0.8% to $11.6 million quarter-over-quarter
• Strong loan growth of $84.5 million (3.74% increase)
• Customer deposits grew by $90.7 million (4.82% increase)
• Healthy ROA of 1.83% and ROE of 15.56%

Negative

• None.

Insights

Banking Financial Analyst

Unity Bancorp's Q1 2025 results demonstrate robust operational execution in a challenging banking environment. The $11.6 million quarterly earnings ($1.13 per diluted share) represent a modest 0.8% sequential increase, while maintaining identical EPS quarter-over-quarter.

The bank's profitability metrics are particularly impressive, with ROA of 1.83% and ROE of 15.56% - both significantly outperforming regional banking sector averages. These metrics reflect effective balance sheet management and operational efficiency.

Most noteworthy is Unity's synchronized growth in both loans and deposits. The 3.74% loan portfolio expansion ($84.5 million) was more than matched by 4.82% growth in customer deposits ($90.7 million), enabling the bank to fund credit growth organically without relying heavily on wholesale funding sources. This balanced approach positions Unity favorably in terms of both liquidity and interest margin preservation.

Management's comments on tariffs provide insight into their customer base composition - primarily domestic-focused small businesses, some potentially benefiting from trade policy shifts. Their proactive positioning as advisors for businesses navigating economic challenges demonstrates customer relationship depth beyond traditional banking services.

Unity's disciplined credit risk management approach, emphasizing conservative loan-to-value ratios and debt-service-coverage levels, reflects prudent underwriting standards. While specific asset quality metrics weren't disclosed, management's explicit focus on addressing potential delinquencies suggests proactive risk monitoring.

The consistent execution across multiple quarters indicates management effectiveness and provides reasonable confidence in sustained performance, particularly impressive given the volatile rate environment facing regional banks.

CLINTON, N.J., April 11, 2025 (GLOBE NEWSWIRE) -- Unity Bancorp, Inc. (NASDAQ: UNTY), parent company of Unity Bank, reported net income of $11.6 million, or $1.13 per diluted share, for the quarter ended March 31, 2025, compared to net income of $11.5 million, or $1.13 per diluted share for the quarter ended December 31, 2024. This represents a 0.8% increase in net income.

James A. Hughes, President and CEO, commented on the financial results: “We are pleased to announce another strong quarter for Unity Bancorp, Inc. We earned $11.6 million in net income, or $1.13 per diluted share, representing 1.83% ROA and 15.56% ROE.

Our Commercial and Residential lending had strong originations, growing loans by $84.5 million in the first quarter, a 3.74% increase from year-end. Our Retail division also demonstrated their deposit gathering capabilities, with customer deposits (ex-brokered deposits) increasing by $90.7 million, or 4.82%, quarter over quarter. We will continue to diligently manage our balance sheet, and aim to fund future credit growth by growing deposits in tandem. Furthermore, we will continue to maintain disciplined credit-risk management, by underwriting credits to conservative loan-to-value and debt-service-coverage levels, as well as swiftly addressing delinquency and non-performing asset scenarios as they arise.

Despite the recent volatility seen in the capital markets primarily due to the implementation of tariffs, as a community bank we do not see any adverse impacts on prospective loan demand. A portion of our small business customers are poised to benefit from tariffs on foreign goods. Further, to the extent that our customers are negatively impacted, we are on standby and will remain a trusted advisor to help them navigate any potential difficulties. Our balance sheet growth highlights Unity’s commitment to providing financial services that support economic development in our local communities. Our motto “Growing With You” has never been more relevant. The relentless dedication of our employees to delivering best-in-class customer service has driven these impressive financial results.”

For the full version of the Company’s quarterly earnings release, including financial tables, please visit News - Unity Bank (q4ir.com).

Unity Bancorp, Inc. is a financial services organization headquartered in Clinton, New Jersey, with approximately $2.8 billion in assets and $2.2 billion in deposits. Unity Bank, the Company’s wholly owned subsidiary, provides financial services to retail, corporate and small business customers through its robust branch network located in Bergen, Hunterdon, Middlesex, Morris, Ocean, Somerset, Union, and Warren Counties in New Jersey and Northampton County in Pennsylvania. For additional information about Unity, visit our website at www.unitybank.com, or call 800-618-BANK.

This news release contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader in understanding anticipated future financial performance. These statements may be identified by use of the words “believe”, “expect”, “intend”, “anticipate”, “estimate”, “project” or similar expressions. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond the Company’s control that could impede its ability to achieve these goals. These factors include those items included in our Annual Report on Form 10-K under the heading “Item IA-Risk Factors” as amended or supplemented by our subsequent filings with the SEC, as well as general economic conditions, trends in interest rates, the ability of our borrowers to repay their loans, our ability to manage and reduce the level of our nonperforming assets, results of regulatory exams, and the impact of any health crisis or national disasters on the Bank, its employees and customers, among other factors.

This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

News Media & Financial Analyst Contact:
George Boyan, EVP and CFO
(908) 713-4565

PDF available: http://ml.globenewswire.com/Resource/Download/fe9c7f9d-e20c-4e4d-a2aa-71f584057b57

FAQ

What was Unity Bancorp's (UNTY) earnings per share in Q1 2025?

Unity Bancorp reported earnings of $1.13 per diluted share in Q1 2025.

How much did Unity Bancorp's (UNTY) loan portfolio grow in Q1 2025?

Unity's loan portfolio grew by $84.5 million, representing a 3.74% increase from year-end 2024.

What was Unity Bancorp's (UNTY) deposit growth in Q1 2025?

Customer deposits (excluding brokered deposits) increased by $90.7 million, or 4.82%, quarter over quarter.

What are Unity Bancorp's (UNTY) current total assets and deposits?

Unity Bancorp has approximately $2.8 billion in assets and $2.2 billion in deposits.

What was Unity Bancorp's (UNTY) Return on Assets (ROA) and Return on Equity (ROE) in Q1 2025?

Unity achieved a 1.83% ROA and 15.56% ROE in Q1 2025.