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What changed in HomeTrust Bancshares, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of HomeTrust Bancshares, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+255 added−253 removedSource: 10-K (2026-03-13) vs 10-K (2025-03-13)

Top changes in HomeTrust Bancshares, Inc.'s 2025 10-K

255 paragraphs added · 253 removed · 215 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

63 edited+9 added−9 removed123 unchanged
Biggest changeTotal credit exposure in a single loan or group of loans to related borrowers exceeding 60% of the Bank’s legal lending limit (currently approximately $50.4 million) must be approved by the Bank's Board of Directors. The Bank has no relationships currently in excess of this limit.
Biggest changeThe Executive Loan Committee may approve one transaction that will temporarily increase a borrower’s total credit exposure by more than 10% over 60% of the Bank’s legal lending limit; otherwise, total credit exposure in a single loan or group of loans to related borrowers exceeding 60% of the Bank’s legal lending limit (approximately $54.2 million as of December 31, 2025) must be approved by the Bank's Board of Directors.
The federal banking agencies have issued guidance on sound risk management practices for concentrations in commercial real estate lending.
Commercial Real Estate Lending Concentrations. The federal banking agencies have issued guidance on sound risk management practices for concentrations in commercial real estate lending.
The SEC has adopted regulations and policies under the Exchange Act that seek to increase corporate responsibility, provide for enhanced penalties for accounting and auditing improprieties and protect investors by improving the accuracy and reliability of corporate disclosures in SEC filings. These regulations and policies include very specific additional disclosure requirements and mandate corporate governance practices. Dividends.
The SEC has adopted regulations and policies under the Exchange Act that seek to increase corporate responsibility, provide enhanced penalties for accounting and auditing improprieties and protect investors by improving the accuracy and reliability of corporate disclosures in SEC filings. These regulations and policies include very specific additional disclosure requirements and mandate corporate governance practices. Dividends.
The Federal Reserve has issued a policy statement on the payment of cash dividends by bank holding companies, which expresses its view that although there are no specific regulations restricting dividend payments by bank holding companies other than state corporate laws, a bank holding company must maintain an adequate capital position and generally should not pay cash dividends unless the company's net income for the past year is sufficient to fully fund the cash dividends and that the prospective rate of earnings appears consistent with the company's capital needs, asset quality and overall financial condition.
The Federal Reserve has issued a policy statement on the payment of cash dividends by bank holding companies, which expresses its view that although there are no specific regulations restricting dividend payments by bank holding companies other than state corporate 11 laws, a bank holding company must maintain an adequate capital position and generally should not pay cash dividends unless the company's net income for the past year is sufficient to fully fund the cash dividends and that the prospective rate of earnings appears consistent with the company's capital needs, asset quality and overall financial condition.
A bank that has 9 experienced rapid growth in commercial real estate lending, has notable exposure to a specific type of commercial real estate loan, or is approaching or exceeding the following supervisory criteria may be identified for further supervisory analysis with respect to real estate concentration risk: • Total reported loans for construction, land development and other land represent 100% or more of the bank’s total regulatory capital; or • Total commercial real estate loans (as defined in the guidance) represent 300% or more of the bank’s total regulatory capital and the outstanding balance of the bank’s commercial real estate loan portfolio has increased 50% or more during the prior 36 months.
A bank that has experienced rapid growth in commercial real estate lending, has notable exposure to a specific type of commercial real estate loan, or is approaching or exceeding the following supervisory criteria may be identified for further supervisory analysis with respect to real estate concentration risk: • Total reported loans for construction, land development and other land represent 100% or more of the bank’s total regulatory capital; or • Total commercial real estate loans (as defined in the guidance) represent 300% or more of the bank’s total regulatory capital and the outstanding balance of the bank’s commercial real estate loan portfolio has increased 50% or more during the prior 36 months.
Other than an investor’s own Internet access charges, we make available free of charge through our website our Annual Report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to these reports, as soon as reasonably practicable after we have electronically filed such material with, or furnished such material to, the SEC. 12
Other than an investor’s own Internet access charges, we make available free of charge through our website our Annual Report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to these reports, as soon as reasonably practicable after we have electronically filed such material with, or furnished such material to, the SEC.
An Item 1.05 Form 8-K will generally be due four business days after a registrant determines that a cybersecurity incident is material. See "Item 1C. Cybersecurity Risk Management, Strategy and Governance” for annual disclosures. 10 Environmental Issues Associated with Real Estate Lending .
An Item 1.05 Form 8-K will generally be due four business days after a registrant determines that a cybersecurity incident is material. See "Item 1C. Cybersecurity Risk Management, Strategy and Governance” for annual disclosures. Environmental Issues Associated with Real Estate Lending .
We do not currently know of any practice, condition, or violation that may lead to termination of our deposit insurance. 8 Transactions with Related Parties. Federal laws strictly limit the ability of banks to engage in certain transactions with their affiliates, including their bank holding companies.
We do not currently know of any practice, condition or violation that may lead to termination of our deposit insurance. Transactions with Related Parties. Federal laws strictly limit the ability of banks to engage in certain transactions with their affiliates, including their bank holding companies.
The Bank is periodically examined by the NCCOB and the Federal Reserve to ensure that it satisfies applicable standards with respect to its capital adequacy, assets, management, earnings, liquidity and 7 sensitivity to market interest rates. The NCCOB and the Federal Reserve also regulate the branching authority of the Bank.
The Bank is periodically examined by the NCCOB and the Federal Reserve to ensure that it satisfies applicable standards with respect to its capital adequacy, assets, management, earnings, liquidity and sensitivity to market interest rates. The NCCOB and the Federal Reserve also regulate the branching authority of the Bank.
Formal enforcement actions include the issuance of a capital directive or cease and desist order, civil money penalties, removal of officers and/or directors and receivership or conservatorship of the institution. Insurance of Accounts and Regulation by the FDIC.
Formal enforcement actions include the issuance of a capital directive or cease and desist order, civil money penalties, removal of officers and/or directors and receivership or conservatorship of the institution. 8 Insurance of Accounts and Regulation by the FDIC.
As described above under "Regulation of HomeTrust Bank – Capital Requirements for HomeTrust Bank," the capital conservation buffer requirement can also restrict the ability of HomeTrust Bancshares, Inc. and the Bank to pay dividends. 11 Stock Repurchases.
As described above under "Regulation of HomeTrust Bank – Capital Requirements for HomeTrust Bank," the capital conservation buffer requirement can also restrict the ability of HomeTrust Bancshares, Inc. and the Bank to pay dividends. Stock Repurchases.
Any such institution must submit a capital restoration plan and, until such plan is approved, may not increase its assets, acquire another depository institution, establish a branch or engage in any new activities, or make capital distributions. As of December 31, 2024, HomeTrust Bank met the requirements to be “well capitalized” and met the capital conservation buffer requirement.
Any such institution must submit a capital restoration plan and, until such plan is approved, may not increase its assets, acquire another depository institution, establish a branch or engage in any new activities, or make capital distributions. As of December 31, 2025, HomeTrust Bank met the requirements to be “well capitalized” and met the capital conservation buffer requirement.
We also originate one-to-four family loans, SBA loans and HELOCs to sell to third-parties. In addition, we invest in debt securities issued by United States Government agencies and GSEs, municipal bonds, corporate bonds, commercial paper and certificates of deposit insured by the FDIC. We offer a variety of deposit accounts for individuals, businesses and nonprofit organizations.
We also originate one-to-four family loans, SBA loans and HELOCs to sell to third-parties. In addition, we invest in debt securities issued by United States Government agencies and GSEs, municipal bonds, corporate bonds and certificates of deposit insured by the FDIC. We offer a variety of deposit accounts for individuals, businesses and nonprofit organizations.
These securities include: United States Treasury obligations, securities of various federal agencies, including mortgage-backed securities, callable agency securities, certain certificates of deposit of insured banks and savings institutions, municipal bonds, investment grade corporate bonds and commercial paper and federal funds. See “How We Are Regulated” below for a discussion of additional restrictions on our investment activities.
These securities include: United States Treasury obligations, securities of various federal agencies, including mortgage-backed securities, callable agency securities, certain certificates of deposit of insured banks and savings institutions, municipal bonds, investment grade corporate bonds and federal funds. See “How We Are Regulated” below for a discussion of additional restrictions on our investment activities.
For a description of the capital regulations, see "Regulation of HomeTrust Bank – Capital Requirements for HomeTrust Bank" and “Note 18 – Regulatory Capital Matters” of the Notes to Consolidated Financial Statements included in Item 8 in this report. At December 31, 2024, HomeTrust Bancshares, Inc. exceeded its minimum regulatory capital requirements under Federal Reserve regulations. Federal Securities Law.
For a description of the capital regulations, see "Regulation of HomeTrust Bank – Capital Requirements for HomeTrust Bank" and “Note 18 – Regulatory Capital Matters” of the Notes to Consolidated Financial Statements included in Item 8 in this report. At December 31, 2025, HomeTrust Bancshares, Inc. exceeded its minimum regulatory capital requirements under Federal Reserve regulations. Federal Securities Law.
For additional information regarding the Bank’s required and actual capital levels at December 31, 2024, see “Note 18 – Regulatory Capital Matters” of the Notes to Consolidated Financial Statements included in Item 8 in this report. Federal Home Loan Bank System.
For additional information regarding the Bank’s required and actual capital levels at December 31, 2025, see “Note 18 – Regulatory Capital Matters” of the Notes to Consolidated Financial Statements included in Item 8 in this report. Federal Home Loan Bank System.
As a multi-state bank, we pay taxes on the portion of revenue generated within the state. In 2024 and 2023 the tax rate was 4.5%. Tennessee . The state of Tennessee requires banks to file a franchise and excise tax form for financial institutions.
As a multi-state bank, we pay taxes on the portion of revenue generated within the state. In 2025 and 2024 the tax rate was 4.5%. Tennessee . The state of Tennessee requires banks to file a franchise and excise tax form for financial institutions.
The excise tax is based on the taxable income (as defined by the state), the portion of revenue generated in the state and the applicable excise tax, which was 6.5% in 2024 and 2023. Virginia . The state of Virginia requires banks to file a bank franchise tax.
The excise tax is based on the taxable income (as defined by the state), the portion of revenue generated in the state and the applicable excise tax, which was 6.5% in 2025 and 2024. Virginia . The state of Virginia requires banks to file a bank franchise tax.
The Senior and Executive Loan Committee approval levels must be approved by the Board of Directors.
The Senior and Executive Loan Committee approval authority levels must be approved by the Board of Directors.
The tax is based on the portion of capital deployed within the state and county level (as defined by the state) and was taxed at $1 per $100 of taxable value in 2024 and 2023. The Company is subject to taxation via nexus in several other states where we do not have physical locations.
The tax is based on the portion of capital deployed within the state and county level (as defined by the state) and was taxed at $1 per $100 of taxable value in 2025 and 2024. 12 The Company is subject to taxation via nexus in several other states where we do not have physical locations.
According to the final rule, qualifying institutions that elect to use the CBLR framework and that maintain a leverage ratio of greater than 9% will be considered to have satisfied the generally applicable risk-based and leverage capital requirements in the regulatory agencies' capital rules, and to have met the capital requirements for the well capitalized category under the agencies' prompt corrective action framework.
Qualifying institutions that elect to use the CBLR framework and that maintain a leverage ratio of greater than 9% will be considered to have satisfied the generally applicable risk-based and leverage capital requirements in the regulatory agencies' capital rules, and to have met the capital requirements for the well capitalized category under the agencies' prompt corrective action framework.
Our fundamentals are a behavior-based set of expectations, intended to support the Company's core values and increase overall employee engagement. As employees exit the organization, we seek their candid feedback through confidential interviews and surveys in an effort to improve our processes, practices and overall work environment.
Our fundamentals are a behavior-based set of expectations, intended to support the Company's core values and increase overall employee engagement. As employees exit the organization, we seek their candid feedback through confidential interviews and surveys to improve our processes, practices and overall work environment.
The franchise tax is based on the portion of revenue generated in the state, the net worth of the Bank and the applicable franchise tax, which was $0.25 per $100 in 2024 and 2023.
The franchise tax is based on the portion of revenue generated in the state, the net worth of the Bank and the applicable franchise tax, which was $0.25 per $100 in 2025 and 2024.
As a multi-state bank, we pay taxes on the portion of revenue generated within the state. In 2024 and 2023 the tax rate was 5.75%. North Carolina. The state of North Carolina requires all corporations chartered or doing business in the state to pay a corporate tax. In 2024 and 2023 the tax rate was 2.5%.
As a multi-state bank, we pay taxes on the portion of revenue generated within the state. In 2025 and 2024 the tax rate was 5.75%. North Carolina. The state of North Carolina requires all corporations chartered or doing business in the state to pay a corporate tax. In 2025 and 2024 the tax rate was 2.25% and 2.5%, respectively.
The guidance provides that the strength of an institution’s lending and risk management practices with respect to such concentrations will be taken into account in supervisory guidance on evaluation of capital adequacy. As of December 31, 2024, HomeTrust Bank’s aggregate recorded loan balances for construction, land development and land loans were 58.2% of regulatory capital.
The guidance provides that the strength of an institution’s lending and risk management practices with respect to such concentrations will be taken into account in supervisory guidance on evaluation of capital adequacy. As of December 31, 2025, HomeTrust Bank’s aggregate recorded loan balances for construction, land development and land loans were 53.7% of regulatory capital.
Each week, a different fundamental is emphasized and discussed throughout the Company through unique videos, a culture mobile app, and at the start of each team meeting.
Each week, a different fundamental is emphasized and discussed throughout the Company through unique videos and at the start of each team meeting.
At December 31, 2024, we had $8.0 million of net operating loss carryforwards for federal income tax purposes. Corporate Dividends-Received Deduction. HomeTrust Bancshares, Inc. files a consolidated return with the Bank. As a result, any dividends HomeTrust Bancshares, Inc. receives from the Bank will not be included as income to HomeTrust Bancshares, Inc.
At December 31, 2025, we had $6.4 million of net operating loss carryforwards for federal income tax purposes. Corporate Dividends-Received Deduction. HomeTrust Bancshares, Inc. files a consolidated return with the Bank. As a result, any dividends HomeTrust Bancshares, Inc. receives from the Bank will not be included as income to HomeTrust Bancshares, Inc.
As of December 31, 2024, the Bank's risk-based capital exceeded the required capital conservation buffer.
As of December 31, 2025, the Bank's risk-based capital exceeded the required capital conservation buffer.
The Bank is subject to a statutory lending limit on aggregate loans to one person or a group of persons combined because of certain relationships and common interests. That limit is generally equal to 15% of unimpaired capital and surplus, which was $84.2 million as of December 31, 2024.
The Bank is subject to a statutory lending limit on aggregate loans to one person or a group of persons combined because of certain relationships and common interests. That limit is generally equal to 15% of unimpaired capital and surplus, which was $90.3 million as of December 31, 2025.
In addition, at December 31, 2024, HomeTrust Bank’s commercial real estate loans, as defined by the guidance, were 233.4% of regulatory capital. See "Risk Factors – The level of our commercial real estate portfolio may subject us to additional regulatory scrutiny." Community Reinvestment and Consumer Protection Laws.
In addition, at December 31, 2025, HomeTrust Bank’s commercial real estate loans, as defined by the guidance, were 209.9% of regulatory capital. See "Risk Factors – The level of our commercial real estate portfolio may subject us to additional regulatory scrutiny." Community Reinvestment and Consumer Protection Laws.
At new employee orientation, newly hired employees are educated on the history of the Company, our vision and our 33 culture fundamentals which outline how we work with our customers, partners and each other. We place an emphasis on providing regular performance feedback and encourage collaboration across the Company through open dialogue and focused execution while seeking diverse perspectives.
At new employee orientation, newly hired employees are educated on the history of the Company, our vision and our 33 culture fundamentals which outline how we work with our customers, partners and each other. We require all leaders to provide regular performance feedback and encourage collaboration across the Company through open dialogue and focused execution while seeking diverse perspectives.
Specific to our investment portfolio, we do not currently participate in hedging programs, stand-alone contracts for interest rate caps, floors or swaps or other activities involving the use of off-balance sheet derivative financial instruments and have no present intention to do so. Further, we do not invest in securities which are not rated investment grade. HOW WE ARE REGULATED General.
Specific to our investment portfolio, we do not currently participate in hedging programs, stand-alone contracts for interest rate caps, floors or swaps or other activities involving the use of off-balance sheet derivative financial instruments and have no present intention to do so.
We support these initiatives through both financial and people resources in our communities. Collectively, our Bank employees volunteer thousands of hours annually in their local communities, such as helping to build homes and teaching grade school youth how to begin establishing healthy money savings habits. Our Bank employees are making a positive difference in the lives of others every day.
We support these initiatives through both financial and people resources in our communities. Collectively, our Bank employees volunteer thousands of hours annually in their local communities, such as helping to build homes and teaching grade school youth how to begin establishing healthy money savings habits.
The Federal Reserve may disapprove such a purchase or redemption if it determines that the proposal would constitute an unsafe or unsound practice or would violate any law, regulation, Federal Reserve order or any condition imposed by, or written agreement with, the Federal Reserve. The Company repurchased 23,483 shares during the year ended December 31, 2024.
The Federal Reserve may disapprove such a purchase or redemption if it determines that the proposal would constitute an unsafe or unsound practice or would violate any law, regulation, Federal Reserve order or any condition imposed by, or written agreement with, the Federal Reserve. The Company repurchased 334,413 shares during the year ended December 31, 2025. Legislative and Regulatory Proposals.
In 2024, we conducted a 6 comprehensive employee engagement survey, with a high-level of employee participation and year-over-year we have continued to improve employee engagement results. Results are utilized to gain perspective on what we do well and identify opportunities for improvement. In addition, HomeTrust continues deepening the understanding of our 33 culture fundamentals which we introduced in 2022.
Year-over-year we have continued to improve our employee engagement results. Results are utilized to gain perspective on what we do well and identify opportunities for improvement. In addition, HomeTrust continues deepening the understanding of our 33 culture fundamentals which we introduced in 2022.
At December 31, 2024, the Company had consolidated total assets of $4.6 billion, total deposits of $3.8 billion and stockholders’ equity of $551.8 million. The Company has not engaged in any significant activity other than holding the stock of the Bank.
At December 31, 2025, the Company had consolidated total assets of $4.5 billion, total deposits of $3.7 billion and stockholders’ equity of $600.7 million. The Company has not engaged in any significant activity other than holding the stock of the Bank.
Our talent acquisition practices are designed to attract top talent and foster an inclusive, respectful and rewarding workplace. Selection teams are guided by our talent acquisition professionals in the proper recruitment and selection of candidates with a focus on competency-based hiring.
Our talent acquisition practices are designed to attract top talent and foster a workplace where belonging fuels excellence. Selection teams are guided by our talent acquisition professionals in the proper recruitment and selection of candidates with a focus on competency-based hiring.
Investment Policy and Procedures The Bank invests in various securities based on investment policies that have been approved by our Board of Directors and adhere to bank regulations.
The Bank currently has one relationship in excess of this limit. Investment Policy and Procedures The Bank invests in various securities based on investment policies that have been approved by our Board of Directors and adhere to bank regulations.
Our Chief Executive Officer and Chief Financial Officer are responsible for the management of our investment portfolio, subject to the direction and guidance of the Board of Directors. These officers consider various factors when making decisions, including the marketability, maturity and tax consequences of the proposed investment.
Our Chief Financial Officer is responsible for the management of our investment portfolio, subject to the direction and guidance of the Asset/Liability Committee of the Board of Directors. He considers various factors when making decisions, including the marketability, maturity and tax consequences of the proposed investment.
The Company adopted the five-year phase in provision as of July 1, 2020. On March 30, 2023, the CFPB issued a final rule amending Regulation B to implement changes to the Equal Credit Opportunity Act made by Section 1071 of the Dodd-Frank Act.
On March 30, 2023, the CFPB issued a final rule amending Regulation B to implement changes to the Equal Credit Opportunity Act made by Section 1071 of the Dodd-Frank Act.
The FHLBs are funded primarily from proceeds derived from the sale of consolidated obligations of the FHLB System and make loans or advances to members in accordance with policies and procedures established by the Board of Directors of the FHLB, which are subject to the oversight of the FHFA.
The FHLBs are funded primarily from proceeds derived from the sale of consolidated obligations of the FHLB System and make loans or advances to members in accordance with policies and procedures established by the Board of Directors of the FHLB. All advances from the FHLB are required to be fully secured by sufficient collateral as determined by the FHLB.
HomeTrust is committed to creating and sustaining a high performing regional community bank and we believe the best way to achieve that goal is to become a regionally and nationally recognized best place to work.
HomeTrust is committed to sustaining a high-performing regional community bank and we believe the best way to achieve that goal is to become a regionally and nationally recognized best place to work. In 2025, the Company was named one of Bank Director’s “Best U.S.
These contributions could also have an adverse effect on the value of FHLB stock in the future. A reduction in value of the Bank’s FHLB stock may result in a decrease in net income and possibly capital. Commercial Real Estate Lending Concentrations.
These contributions have adversely affected the level of FHLB dividends paid and could continue to do so in the future. These contributions could also have an adverse effect on the value of FHLB stock in the future. A reduction in value of the Bank’s FHLB stock may result in a decrease in net income and possibly capital.
HomeTrust Bancshares, Inc. is subject to examination and supervision by, and is required to file certain reports with, the Federal Reserve. HomeTrust Bancshares, Inc. is also subject to the rules and regulations of the SEC under the federal securities laws.
Further, we do not invest in securities which are not rated investment grade. 7 HOW WE ARE REGULATED General. HomeTrust Bancshares, Inc. is subject to examination and supervision by, and is required to file certain reports with, the Federal Reserve. HomeTrust Bancshares, Inc. is also subject to the rules and regulations of the SEC under the federal securities laws.
The HTB Employee Relief Fund will remain in place to provide future charitable financial support to employees in times of crisis, disaster or hardship. We believe a strong corporate culture and employee engagement is crucial to the success of the Company.
The HTB Employee Relief Fund provides financial grants to support employees in times of crisis, disaster or hardship. 6 We believe a strong corporate culture and employee engagement is crucial to the success of the Company. In 2025, we conducted a comprehensive employee engagement survey, with a high-level of employee participation.
In addition, the way we create differentiation from our competition is by focusing on “HOW” we deliver our products and services. While some employees have been a part of HomeTrust Bank for decades, a significant number of employees have more recently brought their professional expertise and industry knowledge to us through internal growth and acquisitions.
While some employees have been a part of HomeTrust Bank for decades, a significant number of employees have more recently brought their professional expertise and industry knowledge to us through internal growth and acquisitions.
Commercial and industrial loan competition is primarily from local and regional commercial banks. We believe that we compete effectively because we consistently deliver high-quality, personal service to our customers that results in a high level of customer satisfaction. We attract our deposits through our branch office network, supplementing this funding through brokered deposits as necessary.
Other commercial banks, credit unions and finance companies provide vigorous competition in consumer lending. Commercial and industrial loan competition is primarily from local and regional commercial banks. We believe that we compete effectively because we consistently deliver high-quality, personal service to our customers that results in a high level of customer satisfaction.
Competition We face strong competition in originating loans and in attracting deposits. Competition in originating real estate loans comes primarily from 5 other commercial banks, savings institutions, credit unions, life insurance companies and mortgage bankers. Other commercial banks, credit unions and finance companies provide vigorous competition in consumer lending.
Our Bank employees are making a positive difference in the lives of others every day. 5 Competition We face strong competition in originating loans and in attracting deposits. Competition in originating real estate loans comes primarily from other commercial banks, savings institutions, credit unions, life insurance companies and mortgage bankers.
In addition, we offer company-paid short-term disability coverage to provide 100% wage replacement for eight weeks for employees with at least one year of service if they experience a qualifying medical event. In 2024, more than half our workforce was impacted by Hurricane Helene, which caused catastrophic damage across Western North Carolina, Eastern Tennessee and Upstate South Carolina.
In addition, we offer company-paid short-term disability coverage to provide 100% wage replacement for eight weeks for employees with at least one year of service if they experience a qualifying medical event.
Human Capital As of December 31, 2024, we employed 539 full-time employees and 24 part-time employees, for a total of 563 employees. Our employees are located primarily in our five-state geographic footprint: North Carolina - 367, Tennessee - 60, Georgia - 49, Virginia - 37 and South Carolina - 37.
Human Capital As of December 31, 2025, we employed 550 full-time employees and 24 part-time employees, for a total of 574 employees. Our employees are located primarily in our five-state geographic footprint: North Carolina (374), Tennessee (54), Georgia (52), South Carolina (41) and Virginia (41). In addition, 12 employees are located in other states across the U.S and work remotely.
HomeTrust Bank is a member of the FHLB of Atlanta, which is one of the 11 regional banks in the FHLB System that administer the home financing credit function of financial institutions. The FHLBs are subject to the oversight of the FHFA and each FHLB serves as a reserve or central bank for its members within its assigned region.
HomeTrust Bank is a member of the FHLB of Atlanta, which is one of the 11 regional banks in the FHLB System that administer the home financing credit function of financial institutions.
The Bank is subject to the BSA and other anti-money laundering laws and regulations, including the USA PATRIOT Act of 2001. These laws and regulations require the Bank to implement policies, procedures and controls to detect, prevent and report money laundering and terrorist financing and to verify the identity of its customers.
These laws and regulations require the Bank to implement policies, procedures and controls to detect, prevent and report money laundering and terrorist financing and to verify the identity of its customers. Violations of these requirements can result in substantial civil and criminal sanctions.
HomeTrust continues to make significant investments in the culture of our workplace, expansion of inclusive benefits, increased employee communication, training and education opportunities. Collectively, these initiatives are designed to have a teammate first work environment to boost employee morale, engagement and job satisfaction.
These recognitions are a testament to the collective achievements of our teams and our ongoing commitment to enhancing the employee experience. HomeTrust continues to make significant investments in the culture of our workplace, expansion of inclusive benefits, increased employee communication, training and education opportunities.
We also have a highly competitive suite of cash management services, online/mobile banking and internal support expertise specific to the needs of small to mid-sized commercial business customers. Beyond traditional financial institutions, we also face competition from financial technology companies, or fintechs.
We believe that we compete for deposits by offering superior service and a variety of deposit accounts at competitive rates. We also have a highly competitive suite of cash management services, online/mobile banking and internal support expertise specific to the needs of small to mid-sized commercial business customers.
Non-compliance with federal or similar state privacy and cybersecurity laws and regulations could lead to substantial regulatory imposed fines and penalties, damages from private causes of action and/or reputational harm.
Non-compliance with federal or similar state privacy and cybersecurity laws and regulations could lead to substantial regulatory imposed fines and penalties, damages from private causes of action and/or reputational harm. 10 In addition, the Securities and Exchange Commission requires registrants to disclose material cybersecurity incidents they experience and to disclose on an annual basis material information regarding their cybersecurity risk management, strategy and governance.
In addition, 13 employees are located in other states across the U.S and work remotely. For almost 100 years, HomeTrust Bank has striven to be an employer of choice. We value and promote belonging in every aspect of our business and at every level within the Company.
For almost 100 years, HomeTrust Bank has striven to be an employer of choice. We value and promote belonging in every aspect of our business and at every level within the Company. We recruit, hire and promote employees based on their individual ability and experience and in accordance with Affirmative Action and Equal Employment Opportunity laws and regulations.
Violations of these requirements can result in substantial civil and criminal sanctions. In addition, provisions of the USA PATRIOT Act require the federal financial institution regulatory agencies to consider the effectiveness of a financial institution's anti-money laundering activities when reviewing mergers and acquisitions. The AMLA, which amends the BSA, was enacted in January 2021.
In addition, provisions of the USA PATRIOT Act require the federal financial institution regulatory agencies to consider the effectiveness of a financial institution's anti-money laundering activities when reviewing mergers and acquisitions. The Anti-Money Laundering Act of 2020, which amended the BSA, is intended to be a comprehensive reform and modernization to U.S. bank secrecy and anti-money laundering laws.
All employees are eligible for CSL and may use it throughout the calendar year to participate in eligible community service activities. The Bank also sponsors a two week per year program called the "Heart of HTB" where employees come together to volunteer at non-profit organizations which serve our communities.
The Bank also annually sponsors two week-long events called the "Heart of HTB" where employees come together to volunteer at non-profit organizations which serve our communities.
Competition for deposits is principally from other commercial banks, savings institutions and credit unions located in the same communities, as well as mutual funds and other alternative investments. We believe that we compete for deposits by offering superior service and a variety of deposit accounts at competitive rates.
We attract our deposits through our branch office network, supplementing this funding through brokered deposits as necessary. Competition for deposits is principally from other commercial banks, savings institutions and credit unions located in the same communities, as well as mutual funds and other alternative investments.
The FHLBs continue to contribute to low- and moderately-priced housing programs through direct loans or interest subsidies on advances targeted for community investment and low- and moderate-income housing projects. These contributions have adversely affected the level of FHLB dividends paid and could continue to do so in the future.
At December 31, 2025, the Bank held $3.4 million in FHLB stock which complied with the holding requirements. 9 The FHLBs continue to contribute to low- and moderately-priced housing programs through direct loans or interest subsidies on advances targeted for community investment and low- and moderate-income housing projects.
An unsatisfactory rating may be the basis for denial of certain applications. The Bank received a “satisfactory” rating during its most recent CRA examination. On October 24, 2023, the federal banking agencies issued a final rule designed to strengthen and modernize regulations implementing the CRA.
An unsatisfactory rating may be the basis for denial of certain applications. The Bank received a “satisfactory” rating during its most recent CRA examination. BSA / Anti-Money Laundering Laws. The Bank is subject to the BSA and other anti-money laundering laws and regulations, including the USA PATRIOT Act of 2001.
We are committed to serving and strengthening the communities in which we live, work and play and believe this commitment fosters strong and rewarding relationships with our clients and community partners. Community Service Leave ("CSL") is awarded annually to employees to foster volunteerism with charitable organizations of their choice throughout the year.
Collectively, these initiatives are designed to have a teammate first work environment to boost employee morale, engagement and job satisfaction. We are committed to serving and strengthening the communities in which we live, work and play and believe this commitment fosters strong and rewarding relationships with our clients and community partners.
All advances from the FHLB are required to be fully secured by sufficient collateral as determined by the FHLB. In addition, all long-term advances are required to provide funds for residential home financing. At December 31, 2024, the Bank held $3.5 million in FHLB stock which complied with the holding requirements.
In addition, all long-term advances are required to provide funds for residential home financing.
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We recruit, hire and promote employees based on their individual ability and experience and in accordance with Affirmative Action and Equal Employment Opportunity laws and regulations.
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Beyond traditional financial institutions, we also face competition from financial technology companies, or fintechs. In addition, the way we create differentiation from our competition is by focusing on “HOW” we deliver our products and services.
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Employees were supported through inclement weather pay, flexible work arrangements and donations of food and supplies. We also established the HTB Employee Relief Fund, launched with a significant initial donation by the Bank, which provided monetary grants to all employees living in areas affected by the storm.
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Supporting our employees through personal hardships is of the utmost importance which is why we founded the HTB Employee Relief Fund, launched with a significant initial donation by the Bank, and continuously funded through employee donations and a generous match by the Company each year.
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In 2024, HomeTrust was recognized as a Best Bank to Work For by American Banker, one of America's Most Loved Workplaces by Newsweek and a Best Place to Work in South Carolina. These recognitions are a testament to the collective achievements of our teams and our ongoing commitment to enhancing the employee experience.
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Banks,” one of Forbes’ “America’s Best Banks,” one of S&P Global’s “Top 50 Community Banks,” and named to the 2025 KBW Honor Roll.
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The Bank has not currently elected to adopt the CBLR framework, but may consider that election in the future. The regulatory agencies have adopted a rule that provides a banking organization the option to phase-in over a five-year period the effects of CECL on its regulatory capital upon the adoption of the standard.
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In addition, the Company has been recognized as one of American Banker’s “Best Banks to Work For,” received a “Most Loved Workplace” certification by Best Practices Institute, named as one of Best Companies Group’s “America’s Best Workplaces,” and a "Best Place to Work" in Georgia, North Carolina, South Carolina, Tennessee and Virginia.
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The changes are designed to encourage banks to expand access to credit, investment and banking services in low and moderate income communities, adapt to changes in the banking industry including mobile and internet banking, provide greater clarity and consistency in the application of the CRA regulations and tailor CRA evaluations and data collection to bank size and type.
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Community Service Leave ("CSL") is awarded annually to employees to foster volunteerism with charitable organizations of their choice throughout the year. All employees are eligible for CSL and may use it throughout the calendar year to participate in eligible community service activities.
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The applicability date for the majority of the provisions in the CRA regulations is January 1, 2026 and additional requirements are scheduled to become applicable on January 1, 2027. The Bank currently cannot predict the impact the changes to the CRA regulations will have on its operations. BSA / Anti-Money Laundering Laws.
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On November 25, 2025, the Federal banking agencies, including the Federal Reserve, proposed a lower CBLR requirement of 8%.
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The AMLA is intended to be a comprehensive reform and modernization to U.S. bank secrecy and anti-money laundering laws.
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Community banks that fail to meet the qualifying criteria after opting into the CBLR framework would have four reporting periods to meet the qualifying criteria again provided they maintain a leverage ratio above 7% and have not used the grace period for more than eight of the prior 20 quarters.
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In addition, the Securities and Exchange Commission requires registrants to disclose material cybersecurity incidents they experience and to disclose on an annual basis material information regarding their cybersecurity risk management, strategy and governance.
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The agencies also proposed removing the provisions under the CBLR framework that provided temporary relief for qualifying community banks during the COVID-19 outbreak. The Bank has not currently elected to adopt the CBLR framework, but may consider that election in the future.
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N o shares were repurchased during the six-month transition period ended December 31, 2023. Legislative and Regulatory Proposals.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe have policies and procedures in place to protect our reputation and promote ethical conduct, but these policies and procedures may not be fully effective. Negative publicity regarding our business, employees or customers, with or without merit, may result in the loss of customers, investors and employees, costly litigation, a decline in revenues and increased governmental regulation.
Biggest changeNegative publicity regarding our business, employees or customers, with or without merit, may result in the loss of customers, investors and employees, costly litigation, a decline in revenues and increased governmental regulation. 22 Our growth or future losses may require us to raise additional capital in the future, but that capital may not be available when it is needed or the cost of that capital may be very high.
Our nonperforming assets adversely affect our net income in various ways: • we record interest income only on a cash basis for nonaccrual loans and any nonperforming debt securities, and do not record interest income for repossessed assets; • we must provide for ECLs through a current period charge to the provision for credit losses; • noninterest expense increases when we write down the value of repossessed assets to reflect changing market values or recognize credit impairment on nonperforming debt securities; • there are legal fees associated with the resolution of problem assets, as well as carrying costs such as taxes, insurance and maintenance fees related to our repossessed assets; and • the resolution of nonperforming assets requires the active involvement of management, a distraction from more profitable activity.
Our nonperforming assets adversely affect our net income in various ways: • we record interest income only on a cash basis for nonaccrual loans and any nonperforming debt securities, and do not record interest income for repossessed assets; • we must provide for ECLs through a current period charge to the provision for credit losses; • noninterest expense increases when we write down the value of repossessed assets to reflect changing market values or recognize credit impairment on nonperforming debt securities; 16 • there are legal fees associated with the resolution of problem assets, as well as carrying costs such as taxes, insurance and maintenance fees related to our repossessed assets; and • the resolution of nonperforming assets requires the active involvement of management, a distraction from more profitable activity.
Although these funds historically have been a relatively stable source of funds for us, availability depends on the individual municipality’s fiscal policies and cash flow needs. 21 Competition with other financial institutions could adversely affect our profitability. Although we consider ourselves competitive in our market areas, we face intense competition in both making loans and attracting deposits.
Although these funds historically have been a relatively stable source of funds for us, availability depends on the individual municipality’s fiscal policies and cash flow needs. Competition with other financial institutions could adversely affect our profitability. Although we consider ourselves competitive in our market areas, we face intense competition in both making loans and attracting deposits.
Any decline in available funding could adversely impact our ability to originate loans, invest in securities, meet our expenses or fulfill obligations such as repaying our borrowings or meeting deposit withdrawal demands, any of which could, in turn, have a material adverse effect on our business, financial condition and results of operations. See “Item 7.
Any decline in available funding could adversely impact our ability to originate loans, invest in securities, meet our expenses or fulfill obligations such as repaying our borrowings or meeting deposit withdrawal demands, any of which could, in turn, have a material 21 adverse effect on our business, financial condition and results of operations. See “Item 7.
Consequently, an adverse development with respect to one loan or one credit relationship can expose us to a significantly greater risk of loss. In addition, during the term of some of our construction and land development loans, no payment from the borrower is required since the accumulated interest is added to the principal of the loan through an interest reserve.
Consequently, an adverse development with respect to one loan or one credit relationship can expose us to a significantly greater risk of loss. 14 In addition, during the term of some of our construction and land development loans, no payment from the borrower is required since the accumulated interest is added to the principal of the loan through an interest reserve.
Furthermore, a prolonged period of inflation could cause wages and other costs to the Company to increase, which could adversely affect our results of operations and financial condition. Severe weather and other natural disasters, acts of war or terrorism, new public health issues or other adverse external events could harm our business.
Furthermore, a prolonged period of inflation could cause wages and other costs to the Company to increase, which could adversely affect our results of operations and financial condition. 13 Severe weather and other natural disasters, acts of war or terrorism, new public health issues or other adverse external events could harm our business.
If these issues or liabilities exceed our estimates, our results of operations and financial condition may be materially negatively affected. • prices at which future acquisitions can be made may not be acceptable to us. 18 • our growth initiatives may require us to recruit experienced personnel to assist in such initiatives.
If these issues or liabilities exceed our estimates, our results of operations and financial condition may be materially negatively affected. • prices at which future acquisitions can be made may not be acceptable to us. • our growth initiatives may require us to recruit experienced personnel to assist in such initiatives.
Additionally, actions by regulatory agencies or significant litigation against us may lead to penalties that materially affect us. Further, changes in accounting standards can be both difficult to predict and involve judgment and discretion in their interpretation by us and our independent registered public accounting firm.
Additionally, actions by regulatory agencies or significant 19 litigation against us may lead to penalties that materially affect us. Further, changes in accounting standards can be both difficult to predict and involve judgment and discretion in their interpretation by us and our independent registered public accounting firm.
If we breach those representations and warranties, the buyers may require us to repurchase the loans and we may incur a loss on the repurchase. Risks Related to Acquisition Activities Our strategy of pursuing acquisitions exposes us to financial, execution and operational risks that could adversely affect us.
If we breach those representations and warranties, the buyers may require us to repurchase the loans and we may incur a loss on the repurchase. 18 Risks Related to Acquisition Activities Our strategy of pursuing acquisitions exposes us to financial, execution and operational risks that could adversely affect us.
Our primary market areas are concentrated in North Carolina (the Asheville metropolitan area, the "Piedmont" region, Charlotte and Raleigh/Cary), South Carolina (Greenville and Charleston), East Tennessee (Kingsport/Johnson City, Knoxville and Morristown), Southwest Virginia (the Roanoke Valley) and Georgia (Greater Atlanta).
Our primary market areas are concentrated in North Carolina (the Asheville metropolitan area, the "Piedmont" region, Charlotte and Raleigh/Cary), South Carolina (Greenville and Charleston), East Tennessee (Kingsport/Johnson City and Morristown), Southwest Virginia (the Roanoke Valley) and Georgia (Greater Atlanta).
In some cases, repossessed collateral for transportation and construction loans, and manufacturing equipment for equipment finance loans may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency may not warrant further substantial collection efforts against the borrower.
In some cases, repossessed collateral for transportation and construction loans, and manufacturing equipment for 15 equipment finance loans may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency may not warrant further substantial collection efforts against the borrower.
Any compromise of our security could deter customers from using our internet banking services that involve the transmission of confidential information. We rely on standard internet security systems to provide the security and authentication necessary to effect secure transmission of data.
Any compromise 20 of our security could deter customers from using our internet banking services that involve the transmission of confidential information. We rely on standard internet security systems to provide the security and authentication necessary to effect secure transmission of data.
The 17 inability of our loans to adjust downward can contribute to increased income in periods of declining interest rates, although this result is subject to the risks that borrowers may refinance these loans during such periods.
The inability of our loans to adjust downward can contribute to increased income in periods of declining interest rates, although this result is subject to the risks that borrowers may refinance these loans during such periods.
Properties under construction are often difficult to sell and typically must be completed in order to be successfully 14 sold, which also complicates the process of working out problem construction loans.
Properties under construction are often difficult to sell and typically must be completed in order to be successfully sold, which also complicates the process of working out problem construction loans.
We may also experience greater than anticipated customer losses even if the integration process is successful. • to finance a future acquisition, we may borrow funds, thereby increasing our leverage and diminishing our liquidity, or raise additional capital, which could dilute the interests of our existing stockholders. • we have completed six acquisitions during the past 12 years that enhanced our rate of growth.
We may also experience greater than anticipated customer losses even if the integration process is successful. • to finance a future acquisition, we may borrow funds, thereby increasing our leverage and diminishing our liquidity, or raise additional capital, which could dilute the interests of our existing stockholders. • we have completed six acquisitions during the past 13 years that enhanced our rate of growth.
Factors that could detrimentally impact our access to liquidity sources include a decrease in the level of our business activity as a result of a downturn in the Georgia, North Carolina, South Carolina, Tennessee and/or Virginia markets in which the majority of our loans are concentrated or adverse regulatory action against us.
Factors that could detrimentally impact our access to liquidity sources include a decrease in the level of our business activity as a result of a downturn in the Georgia, North Carolina, South Carolina, Tennessee and/or Virginia markets, which is where the majority of our loans are concentrated, or adverse regulatory action against us.
Credit-related impairment is recognized as an ACL on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings. As of December 31, 2024, an ACL was not deemed necessary by the Company for credit-related impairment on our securities portfolio.
Credit-related impairment is recognized as an ACL on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings. As of December 31, 2025, an ACL was not deemed necessary by the Company for credit-related impairment on our securities portfolio.
Inflationary pressures and rising prices may adversely affect our results of operations and financial condition. Inflation rose sharply starting at the end of calendar year 2021 to levels not seen in more than 40 years. This rise continued through the first half of calendar year 2024.
Inflationary pressures and rising prices may adversely affect our results of operations and financial condition. Inflation rose sharply starting at the end of 2021 to levels not seen in more than 40 years. This rise continued through the first half of 2024.
This could result in lower net interest margins and lower interest income in future periods. We may experience future goodwill impairment, which could reduce our earnings. Our annual goodwill impairment test did not identify any impairment for the year ended December 31, 2024.
This could result in lower net interest margins and lower interest income in future periods. We may experience future goodwill impairment, which could reduce our earnings. Our annual goodwill impairment test did not identify any impairment for the year ended December 31, 2025.
As a result, when interest rates rise, our funding costs may rise faster than the yield we earn on our assets, causing our net interest margin to contract until the yields on interest-earning assets catch up. Changes in the slope of the “yield curve”, or the spread between short-term and long-term interest rates, could also reduce our net interest margin.
As a result, when interest rates rise, our funding costs may rise faster than the yield we earn on our assets, causing our net interest margin to contract until the yields on interest-earning assets catch up. Changes in the slope of the “yield curve,” or the spread between short-term and long-term interest rates, could also reduce our net interest margin.
Additionally, charge-offs on commercial real estate loans may be larger on a per loan basis than those incurred with our residential and consumer loan portfolios. The level of our commercial real estate loan portfolio may subject us to additional regulatory scrutiny.
Additionally, charge-offs on commercial real estate loans may be larger on a per loan basis than those incurred with our residential and consumer loan portfolios. The level of our non-owner occupied commercial real estate loan portfolio may subject us to additional regulatory scrutiny.
At December 31, 2024, the most significant portion of our loans located outside of our primary market areas were equipment finance loans, SBA loans and purchased HELOCs.
At December 31, 2025, the most significant portion of our loans located outside of our primary market areas were equipment finance loans, SBA loans and purchased HELOCs.
Our NBV in the loan at the time of foreclosure and thereafter is 16 compared to the updated market value of the foreclosed property less estimated selling costs (fair value). A charge-off is recorded for any excess in the asset’s NBV over its fair value.
Our net book value in the loan at the time of foreclosure and thereafter is compared to the updated market value of the foreclosed property less estimated selling costs (fair value). A charge-off is recorded for any excess in the asset’s net book value over its fair value.
In response, we elected to cease further originations within the sector as of December 31, 2023 and devote additional attention towards resolving loans within the existing portfolio.
In response, we elected to cease further originations within the sector as of December 31, 2023 and have devoted additional attention towards resolving loans within the existing portfolio.
Although we have developed and continue to invest in systems and processes that are designed to detect and prevent security breaches and cyber-attacks and periodically test our security, these precautions may not protect our systems from compromises or breaches of our security measures, and could result in losses to us or our customers, our loss of business and/or customers, damage to our reputation, the incurrence of additional expenses, disruption to our business, our inability to grow our online services or other businesses, additional regulatory scrutiny or penalties or our exposure to civil litigation and possible financial liability, any of which could have a material adverse effect on our business, financial condition and results of operations. 20 Our security measures may not protect us from system failures or interruptions of our own systems or those of our third-party vendors .
Although we have developed and continue to invest in systems and processes that are designed to detect and prevent security breaches and cyber-attacks and periodically test our security, these precautions may not protect our systems from compromises or breaches of our security measures, and could result in losses to us or our customers, our loss of business and/or customers, damage to our reputation, the incurrence of additional expenses, disruption to our business, our inability to grow our online services or other businesses, additional regulatory scrutiny or penalties or our exposure to civil litigation and possible financial liability, any of which could have a material adverse effect on our business, financial condition and results of operations.
Bank regulators also have the ability to impose conditions in the approval of merger and acquisition transactions. The significant federal and state banking regulations that affect us are described under the heading "Business – How We Are Regulated” in Item 1 of this Form 10-K.
Bank regulators can also impose conditions on the approval of merger and acquisition transactions. The significant federal and state banking regulations that affect us are described under the heading "Business – How We Are Regulated” in Item 1 of this Form 10-K.
At December 31, 2024, municipal leases were $166.0 million, or 4.5% of our total loan portfolio. We offer ground and equipment lease financing to fire departments located throughout North Carolina and, to a lesser extent, South Carolina and Virginia.
At December 31, 2025, municipal leases were $166.4 million, or 4.7% of our total loan portfolio. We offer ground and equipment lease financing to fire departments located throughout North Carolina and, to a lesser extent, South Carolina and Virginia.
For these reasons, we may experience higher rates of delinquency, default and loss. Our non-owner occupied real estate loans may expose us to increased credit risk. At December 31, 2024, $142.3 million, or 22.6% of our one-to-four family loans and 3.9% of our total loan portfolio, consisted of loans secured by non-owner occupied residential properties.
For these reasons, we may experience higher rates of delinquency, default and loss. Our non-owner occupied residential real estate loans may expose us to increased credit risk. At December 31, 2025, $142.6 million, or 22.5% of our one-to-four family loans and 4.0% of our total loan portfolio, consisted of loans secured by non-owner occupied residential properties.
At December 31, 2024, commercial real estate loans were $1.8 billion, or 49.5% of our total loan portfolio, including multifamily loans totaling $120.4 million or 3.3% of our total loan portfolio. These loans typically involve higher principal amounts than other types of loans and some of our commercial borrowers have more than one loan outstanding with us.
At December 31, 2025, commercial real estate loans were $1.8 billion, or 49.8% of our total loan portfolio, including multifamily loans totaling $110.9 million or 3.1% of our total loan portfolio. These loans typically involve higher principal amounts than other types of loans and some of our commercial borrowers have more than one loan outstanding with us.
Severe weather and other natural disasters such as Hurricane Helene, acts of war or terrorism, new public health issues or other adverse external events could have a significant impact on our ability to conduct business.
Severe weather and other natural disasters, acts of war or terrorism, public health issues or other adverse external events could have a significant impact on our ability to conduct business.
Starting in March 2022, the FOMC increased the targeted federal funds rate 11 separate times, raising the rate by 525 basis points to a range of 5.25% to 5.50%, before decreasing the rate three times starting in September 2024 to a range of 4.25% to 4.50%.
Starting in March 2022, the FOMC increased the targeted federal funds rate 11 separate times, raising the rate by 525 basis points to a range of 5.25% to 5.50%, before decreasing the rate three times in 2024 to a range of 4.25% to 4.50% and three additional times in 2025 to a range of 3.50% to 3.75%.
Construction and land development loans in our commercial real estate loan portfolio at December 31, 2024, totaled $274.4 million, or 7.5% of our total loan portfolio, and consisted of loans to contractors and builders primarily to finance the construction of single and multifamily homes, subdivisions, as well as commercial properties.
Construction and land development loans in our commercial real estate loan portfolio at December 31, 2025, totaled $277.0 million, or 7.7% of our total loan portfolio, and consisted of loans to contractors and builders primarily to finance the construction of single and multifamily homes, subdivisions, as well as commercial properties.
These rules require financial institutions to establish procedures for 19 identifying and verifying the identity of customers seeking to open new financial accounts. Failure to comply with these regulations could result in fines or sanctions and limit our ability to get regulatory approval of acquisitions or other activities.
These rules require financial institutions to establish procedures for identifying and verifying the identity of customers seeking to open new financial accounts. Failure to comply with these regulations could result in fines or sanctions and limit our ability to get regulatory approval of acquisitions or other activities. Banking institutions can receive large fines for non-compliance with these laws and regulations.
At December 31, 2024, we had $976.9 million in certificates of deposit that mature within one year and $2.8 billion in checking, savings and money market accounts with no stated maturity.
At 17 December 31, 2025, we had $882.2 million in certificates of deposit that mature within one year and $2.8 billion in checking, savings and money market accounts with no stated maturity.
At December 31, 2024, construction and land development loans in our residential real estate loan portfolio were $53.7 million, or 1.5% of our total loan portfolio, and consisted primarily of construction to permanent loans to homeowners building a residence or developing lots in residential subdivisions intending to construct a residence within one year.
At December 31, 2025, construction and land development loans in our residential real estate loan portfolio were $45.6 million, or 1.3% of our total loan portfolio, and consisted primarily of construction to permanent loans to homeowners building a residence or developing lots in residential subdivisions intending to construct a residence within one year.
At December 31, 2024, $28.2 million of our municipal leases contained a non-appropriation clause. Our allowance for credit losses may prove to be insufficient to absorb losses in our loan portfolio.
At December 31, 2025, $30.6 million of our municipal leases contained a non-appropriation clause. Our allowance for credit losses may prove to be insufficient to absorb losses in our loan portfolio.
Furthermore, in the case of speculative construction loans, there is the added risk associated with identifying an end-purchaser for the finished project. At December 31, 2024, $70.5 million of our construction and land development loans were for speculative construction and none were classified as nonaccruing.
Furthermore, in the case of speculative construction loans, there is the added risk associated with identifying an end-purchaser or tenant for the finished project. At December 31, 2025, $161.0 million of our construction and land development loans were for speculative construction and none were classified as nonaccruing.
In addition, our success has been and continues to be highly dependent upon the services of our directors, several of whom are nearing retirement age, and we may not be able to identify and attract suitable candidates to replace such directors.
In addition, our success has been and continues to be highly dependent upon the services of our directors, several of whom have reached or are nearing the mandatory retirement age under our bylaws, and we may not be able to identify and attract suitable candidates to replace these directors.
Such balloon payments may require the borrower to either sell or refinance the underlying property in order to make the payment, which may increase the risk of default or non-payment. At December 31, 2024, commercial real estate loans that were nonperforming totaled $12.1 million, or 43.6% of our total nonperforming loans.
Such balloon payments may require the borrower to either sell or refinance the underlying property in order to make the payment, which may increase the risk of default or non-payment. At December 31, 2025, commercial real estate loans that were nonperforming totaled $17.4 million, or 39.8% of our total nonperforming loans.
Our total loans for multifamily, non-farm/non-residential, construction, land development and other land represented 233.4% of total risk-based capital at December 31, 2024.
Our total loans for multifamily, non-farm/non-residential, construction, land development and other land represented 209.9% of total risk-based capital at December 31, 2025.
The amount of this ACL is determined by our management through periodic reviews and consideration of several factors, including, but not limited to: • our reserve on loans collectively evaluated, based on peer loss experience, which management believes provides the best basis for its assessment of ECLs, and consideration of the effects of past events, current conditions and reasonable and supportable forecasts on the collectability of the loan portfolio; • a qualitative reserve adjustment based on factors that are relevant within the qualitative framework; and • our reserve on individually evaluated loans which no longer share similar risk characteristics, which is based on a DCF analysis unless the loan meets the criteria for use of the fair value of collateral, either by virtue of an expected foreclosure or through meeting the definition of collateral dependent.
The amount of this ACL is determined by our management through periodic reviews and consideration of several factors, including, but not limited to: • our reserve on loans collectively evaluated, based on peer loss experience, which management believes provides the best basis for its assessment of ECLs, and consideration of the effects of past events, current conditions and reasonable and supportable forecasts on the collectability of the loan portfolio; • a qualitative reserve adjustment based on factors that are relevant within the qualitative framework; and • our reserve on individually evaluated loans that no longer share similar risk characteristics, which is based on a DCF analysis unless the loan meets the criteria for use of the fair value of collateral, either by virtue of an expected foreclosure or through meeting the definition of "collateral dependent." Our determination of the appropriate level of the ACL inherently involves a high degree of subjectivity and requires us to make significant estimates of current credit risks and future trends, all of which may undergo material changes over time.
Further, if we are unable to raise additional capital when required by our bank regulators, we may be subject to adverse regulatory action. We rely on dividends from the Bank for substantially all of our revenue at the holding company level.
In addition, any additional capital we obtain may dilute the interests of existing holders of our common stock. Further, if we are unable to raise additional capital when required by our bank regulators, we may be subject to adverse regulatory action. We rely on dividends from the Bank for substantially all of our revenue at the holding company level.
From September through the end of calendar year 2024, the Federal Open Market Committee (“FOMC”) of the Federal Reserve reduced the targeted federal funds rate three times to a range of 4.25% to 4.50%; however, despite these actions, general market rates of interest remain elevated.
From September through the end of 2024, the Federal Open Market Committee (“FOMC”) of the Federal Reserve reduced the targeted federal funds rate three times to a range of 4.25% to 4.50%, and further reduced the rate in September, October and December 2025 to a range of 3.50% to 3.75%; however, despite these actions, general market rates of interest remain elevated.
Our nonperforming assets (which consist of nonaccruing loans and repossessed assets) were $28.8 million, or 0.63% of total assets, at December 31, 2024, compared to $19.3 million, or 0.41% of total assets, at December 31, 2023, respectively.
Our nonperforming assets (which consist of nonaccruing loans and repossessed assets) were $44.4 million, or 0.98% of total assets, at December 31, 2025, compared to $28.8 million, or 0.63% of total assets, at December 31, 2024, respectively.
Our equipment finance and auto finance lending increases our exposure to lending risks. At December 31, 2024, $406.4 million and $69.1 million, or 11.1% and 1.9% of our total loan portfolio, consisted of equipment finance and indirect auto finance loans, respectively. Equipment finance and indirect auto finance loans are inherently risky as they are secured by assets that depreciate rapidly.
Our equipment finance and auto finance lending increases our exposure to lending risks. At December 31, 2025, $311.4 million and $38.3 million, or 8.7% and 1.0% of our total loan portfolio, consisted of equipment finance and indirect auto finance loans, respectively. Equipment finance and indirect auto finance loans are inherently risky as they are secured by assets that depreciate rapidly.
While we assess and improve these programs on an ongoing basis, there can be no assurance that our risk management or compliance programs, along with other related controls, will effectively mitigate all risk and limit losses in our business.
We also maintain a compliance program to identify, measure, assess and report on our adherence to applicable laws, policies and procedures. While we assess and improve these programs on an ongoing basis, there can be no assurance that our risk management or compliance programs, along with other related controls, will effectively mitigate all risk and limit losses in our business.
As of December 31, 2024, our loans with interest rate floors totaled approximately $749.0 million, or 20.5% of our total loan portfolio, and had a weighted average floor rate of 5.45%, of which $113.0 million were at their floor rate.
As of December 31, 2025, our loans with interest rate floors totaled approximately $744.9 million, or 20.8% of our total loan portfolio, and had a weighted average floor rate of 5.03%, of which $155.1 million were at their floor rate.
Banking institutions can receive large fines for non-compliance with these laws and regulations. While we have developed policies and procedures designed to assist in compliance with these laws and regulations, no assurance can be given that these policies and procedures will be effective in preventing violations of these laws and regulations.
While we have developed policies and procedures designed to assist in compliance with these laws and regulations, no assurance can be given that these policies and procedures will be effective in preventing violations of these laws and regulations. Our framework for managing risks may not be effective in mitigating risk and loss to us .
Such events could also affect the stability of our deposit base, cause significant property damage, adversely affect our employees, adversely impact the values of collateral securing our loans and/or interfere with our borrowers’ abilities to repay their debt obligations to us. 13 Risks Related to Lending Activities Our business may be adversely affected by credit risk associated with residential property.
There is no assurance that our business continuity and disaster recovery program can adequately mitigate these risks. Such events could also affect the stability of our deposit base, cause significant property damage, adversely affect our employees, adversely impact the values of collateral securing our loans and/or interfere with our borrowers’ abilities to repay their debt obligations to us.
Our ability to raise additional capital, if needed, will depend on conditions in the capital markets at that time, which are outside our control, and on our financial condition and performance. Accordingly, we cannot make assurances that we will be able to raise additional capital, if needed, on terms that are acceptable to us, or at all.
Accordingly, we cannot make assurances that we will be able to raise additional capital, if needed, on terms that are acceptable to us, or at all. If we cannot raise additional capital when needed, our ability to further expand our operations could be materially impaired and our financial condition and liquidity could be materially and adversely affected.
At December 31, 2024, $630.4 million, or 17.3% of our total loan portfolio, was secured by liens on one-to-four family residential loans. These types of loans are generally sensitive to regional and local economic conditions that significantly impact the ability of borrowers to meet their loan payment obligations, making loss levels difficult to predict.
These types of loans are generally sensitive to regional and local economic conditions that significantly impact the ability of borrowers to meet their loan payment obligations, making loss levels difficult to predict.
In addition, during this long period of time from financing to completion, the collateral often does not generate any cash flow to support debt service. Our commercial real estate loans involve higher principal amounts than other loans and repayment of these loans may be dependent on factors outside our control or the control of our borrowers.
In addition, during this long period of time from financing to completion, the collateral often does not generate any cash flow to support debt service.
As a result of those efforts, although net charge-offs within the portfolio remained elevated, the outstanding balance of loans to smaller operators declined from $56.2 million to $28.2 million over the course of calendar year 2024. 15 Lastly, as a result of our decision to cease indirect auto finance loan originations as of March 31, 2024, the outstanding balance of the portfolio declined from $107.0 million to $69.1 million over the course of calendar year 2024.
Lastly, as a result of our decision to cease indirect auto finance loan originations as of March 31, 2024, the outstanding balance of the portfolio has declined from $107.0 million at December 31, 2023 to $69.1 million at December 31, 2024 and $38.3 million at December 31, 2025, respectively.
These risks include liquidity risk, credit risk, market risk, interest rate risk, operational risk, legal and compliance risk and reputational risk, among others. We also maintain a compliance program to identify, measure, assess and report on our adherence to applicable laws, policies and procedures.
We have established processes and procedures intended to identify, measure, monitor, report, analyze and control the types of risk to which we are subject. These risks include liquidity risk, credit risk, market risk, interest rate risk, operational risk, legal and compliance risk and reputational risk, among others.
Our growth or future losses may require us to raise additional capital in the future, but that capital may not be available when it is needed or the cost of that capital may be very high. We are required by federal regulatory authorities to maintain adequate levels of capital to support our operations.
We are required by federal regulatory authorities to maintain adequate levels of capital to support our operations. Our ability to raise additional capital, if needed, will depend on conditions in the capital markets at that time, which are outside our control, and on our financial condition and performance.
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There is no assurance that our business continuity and disaster recovery program can adequately mitigate these risks.
Added
Risks Related to Lending Activities Our business may be adversely affected by credit risk associated with residential property. At December 31, 2025, $633.5 million, or 17.7% of our total loan portfolio, was secured by liens on one-to-four family residential loans.
Removed
Our determination of the appropriate level of the ACL inherently involves a high degree of subjectivity and requires us to make significant estimates of current credit risks and future trends, all of which may undergo material changes over time.
Added
Our non-owner occupied and owner occupied commercial real estate loans involve higher principal amounts than other loans and repayment of these loans may be dependent on factors outside our control or the control of our borrowers.
Removed
Our framework for managing risks may not be effective in mitigating risk and loss to us . We have established processes and procedures intended to identify, measure, monitor, report, analyze and control the types of risk to which we are subject.
Added
As a reflection of those efforts, although net charge-offs within the portfolio remained elevated, the outstanding balance of over-the-road trucking loans has declined from $121.4 million at December 31, 2023 to $74.5 million at December 31, 2024 and $38.0 million as of December 31, 2025, respectively.
Removed
If we cannot raise additional capital when needed, our ability to further expand our operations could be materially impaired and our financial condition and liquidity could be materially and adversely affected. In addition, any additional capital we 22 obtain may dilute the interests of existing holders of our common stock.
Added
Our security measures may not protect us from system failures or interruptions of our own systems or those of our third-party vendors .
Added
We have policies and procedures in place to protect our reputation and promote ethical conduct, but these policies and procedures may not be fully effective.
Added
Recent changes in the regulatory landscape and shifting federal priorities have moved toward a reduction in emphasis on certain ESG priorities, particularly around climate change and diversity, equity and inclusion (“DEI”). This shift has led to a rollback of regulations that mandate specific disclosures and operational practices in these areas.
Added
However, some stakeholder groups continue to demand greater transparency and action, resulting in a complex and potentially conflicting environment for companies. If regulatory enforcement of ESG-related policies becomes less stringent, companies may face reputational risks if their practices are seen as insufficient or inconsistent with broader societal expectations, especially related to DEI and environmental stewardship.
Added
As a result, navigating this evolving regulatory and public opinion landscape may require us to balance compliance with regulatory requirements against maintaining investor, customer, and stakeholder trust.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur Chief Technology Officer is responsible for monitoring and coordinating the Company’s Information Security Program, which is managed on a day-to-day basis by our Information Security Officer.
Biggest changeOur Information Security Officer is responsible for developing and coordinating the Company’s Information Security Program, which is managed operationally on a day-to-day basis by our Infrastructure and Security Manager, reporting to our Chief Technology Officer.
Any incident assessed as potentially being or becoming material is further escalated to the Operating Committee which includes all executive officers and may be elevated to the Board of Directors if 23 the incident is deemed material or otherwise appropriate. Outside legal counsel and forensic analysts may also be engaged to assist in evaluating and remediating cybersecurity issues and events.
Any incident assessed as potentially being or becoming material is further escalated to the Operating Committee which includes all executive officers and may be elevated to the Board of Directors if the incident is deemed material or otherwise appropriate. Outside legal counsel and forensic analysts may also be engaged to assist in evaluating and remediating cybersecurity issues and events.
To ensure this focus is properly disseminated, the Enterprise Risk Management Program includes a Management Risk Committee, made up of executive officers, to ensure proper oversight of risk-related decision making and communication by executive management.
To ensure this focus is properly disseminated, the Enterprise 23 Risk Management Program includes a Management Risk Committee, made up of executive officers, to ensure proper oversight of risk-related decision making and communication by executive management.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed3 unchanged
Biggest changeIn total, as of December 31, 2024, we have 37 locations in five states, which include: North Carolina (the Asheville metropolitan area, the "Piedmont" region, Charlotte and Raleigh/Cary), South Carolina (Greenville and Charleston), East Tennessee (Kingsport/Johnson City, Knoxville and Morristown), Southwest Virginia (the Roanoke Valley) and Georgia (Greater Atlanta). Of those offices, 8 are leased facilities.
Biggest changeIn total, as of December 31, 2025, we have 34 locations in five states, which include: North Carolina (the Asheville metropolitan area, the "Piedmont" region, Charlotte and Raleigh/Cary), South Carolina (Greenville and Charleston), East Tennessee (Kingsport/Johnson City and Morristown), Southwest Virginia (the Roanoke Valley) and Georgia (Greater Atlanta). Of those offices, 8 are leased facilities.
We also own an operations center located in Asheville, North Carolina. We lease additional space, which is adjacent to the facility we own in Asheville, for administrative and operations personnel. The lease terms for our branch offices, operations center and other offices are not individually material. Lease expirations range from one to 18 years.
We also own an operations center located in Asheville, North Carolina. We lease additional space, which is adjacent to the facility we own in Asheville, for administrative and operations personnel. The lease terms for our branch offices, operations center and other offices are not individually material. Lease expirations range from one to 15 years.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by the Issuer The following table provides information about repurchases of common stock by the Company during the quarter ended December 31, 2024: Period Total # of Shares Purchased Average Price Paid per Share Total # of Shares Purchased as Part of Publicly Announced Plans Maximum # of Shares that May Yet Be Purchased Under Publicly Announced Plans October 1 - October 31, 2024 — $ — — 243,156 November 1 - November 30, 2024 — — — 243,156 December 1 - December 31, 2024 — — — 243,156 Total — $ — — 243,156 Over the years as a public company, the Company's Board of Directors has, from time to time, authorized the repurchase of its common stock.
Biggest changeSee Item 1, “How We Are Regulated,” for more information regarding the restrictions on the Company’s and the Bank’s abilities to pay dividends. 24 Purchases of Equity Securities by the Issuer The following table provides information about repurchases of common stock by the Company during the quarter ended December 31, 2025: Period Total # of Shares Purchased Average Price Paid per Share Total # of Shares Purchased as Part of Publicly Announced Plans Maximum # of Shares that May Yet Be Purchased Under Publicly Announced Plans October 1 - October 31, 2025 67,091 $ 40.46 67,091 82,853 November 1 - November 30, 2025 60,942 39.68 60,942 21,911 December 1 - December 31, 2025 113,168 44.57 113,168 778,743 Total 241,201 $ 42.19 241,201 778,743 Over the years as a public company, the Company's Board of Directors has, from time to time, authorized the repurchase of its common stock.
The information presented below assumes the reinvestment of all dividends and that the value of common stock and each index was $100 on June 30, 2019. Historical stock price performance is not necessarily indicative of future stock price performance.
The information presented below assumes the reinvestment of all dividends and that the value of common stock and each index was $100 on June 30, 2020. Historical stock price performance is not necessarily indicative of future stock price performance.
The Company began paying its first cash dividends during the second quarter of fiscal year 2019. The timing and amount of cash dividends paid depends on our earnings, capital requirements, financial condition and other relevant factors. We also have the ability to receive dividends or capital distributions from HomeTrust Bank, our wholly owned subsidiary.
The timing and amount of cash dividends paid depends on our earnings, capital requirements, financial condition and other relevant factors. We also have the ability to receive dividends or capital distributions from HomeTrust Bank, our wholly owned subsidiary. There are regulatory restrictions on the ability of HomeTrust Bank to pay dividends.
The shares may be purchased in the open market or in privately negotiated transactions, from time to time depending upon market conditions and other factors. 24 Stockholder Return Performance Graph Presentation The performance graph below compares the Company’s cumulative stockholder return on its common stock since June 30, 2019 to the cumulative total return of the S&P US BMI Bank Index and the NASDAQ Composite for the periods indicated.
Stockholder Return Performance Graph Presentation The performance graph below compares the Company’s cumulative stockholder return on its common stock since June 30, 2020 to the cumulative total return of the S&P US BMI Bank Index and the NASDAQ Composite for the periods indicated.
The most recent time this was done, on February 28, 2022, 806,000 shares of common stock were authorized for repurchase representing approximately 5% of the Company's outstanding shares at the time of the announcement.
During the fourth quarter of 2025 , the Company completed the repurchase plan originally authorized on February 28, 2022, of 806,000 shares of common stock which represented approximately 5% of the Company's outstanding shares at the time of the announcement.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. As of December 31, 2024, the Company’s common stock was listed on the NASDAQ Stock Market LLC under the symbol “HTBI.” However, the Company's listing was transferred to the New York Stock Exchange LLC on February 24, 2025 under the symbol "HTB".
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The Company's common stock is listed on the New York Stock Exchange LLC under the symbol "HTB". As of the close of business on March 9, 2026, there were 16,928,453 shares of common stock outstanding held by 928 holders of record.
As of the close of business on March 7, 2025, there were 17,567,959 shares of common stock outstanding held by 959 holders of record. Certain shares are held in “nominee” or “street” name and accordingly, the number of beneficial owners of such shares is not known or included in the foregoing number.
Certain shares are held in “nominee” or “street” name and accordingly, the number of beneficial owners of such shares is not known or included in the foregoing number. The Company began paying its first cash dividends during the second quarter of fiscal year 2019.
Removed
There are regulatory restrictions on the ability of HomeTrust Bank to pay dividends. See Item 1, “How We Are Regulated,” for more information regarding the restrictions on the Company’s and the Bank’s abilities to pay dividends.
Added
On December 15, 2025, an additional 870,000 shares of common stock were authorized for repurchase representing approximately 5% of the Company's outstanding shares at the time of the announcement. As of December 31, 2025 , 91,257 of these shares had been purchased at an average price of $44.55 per share.
Removed
As of December 31, 2024 , 562,844 of these shares had been purchased at an average price of $28.83 per share, 23,483 of which were repurchased during the year ended December 31, 2024 .
Added
The shares may be purchased in the open market or in privately negotiated transactions, from time to time depending upon market conditions and other factors.
Removed
Year Ended June 30, Six Months Ended December 31, 2023 Year Ended December 31, 2024 2019 2020 2021 2022 2023 HomeTrust Bancshares, Inc. 100.00 64.18 114.56 102.48 85.63 107.71 135.82 S&P US BMI Bank Index 100.00 76.33 128.52 103.70 95.79 115.05 148.25 NASDAQ Composite 100.00 127.56 188.74 144.29 182.01 201.83 265.85
Added
Year Ended June 30, Six Months Ended December 31, 2023 Year Ended December 31, 2020 2021 2022 2023 2024 2025 HomeTrust Bancshares, Inc. 100.00 178.50 159.67 133.42 167.83 211.63 269.81 S&P US BMI Bank Index 100.00 168.37 135.86 125.49 150.73 194.23 249.37 NASDAQ Composite 100.00 147.96 113.12 142.68 158.22 208.41 252.47

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

84 edited+20 added−22 removed85 unchanged
Biggest changeFinancial Highlights (Dollars in thousands) December 31, 2024 December 31, 2023 June 30, 2023 June 30, 2022 Selected financial condition data Total assets $ 4,595,430 $ 4,672,633 $ 4,607,487 $ 3,549,204 Cash and cash equivalents 279,219 347,140 303,497 105,119 Commercial paper, net — — — 194,427 Certificates of deposit in other banks 28,538 34,722 33,152 23,551 Debt securities available for sale, at fair value 152,011 126,950 151,926 126,978 Loans, net of ACL and deferred loan fees and costs 3,603,014 3,591,381 3,611,630 2,734,605 Deposits 3,779,203 3,661,373 3,601,168 3,099,761 Junior subordinated debt 10,120 10,021 9,971 — Borrowings 188,000 433,763 457,263 — Stockholders’ equity 551,758 499,893 471,186 388,845 Year Ended December 31, 2024 Six Months Ended December 31, 2023 Year Ended June 30, (Dollars in thousands, except per share data) 2023 2022 Selected operations data Total interest and dividend income $ 261,616 $ 124,684 $ 187,126 $ 116,114 Total interest expense 92,941 40,601 29,711 5,340 Net interest income 168,675 84,083 157,415 110,774 Provision (benefit) for credit losses 7,545 5,930 15,392 (592) Net interest income after provision (benefit) for credit losses 161,130 78,153 142,023 111,366 Service charges and fees on deposit accounts 9,165 4,686 9,510 9,462 Loan income and fees 2,737 982 2,571 3,185 Gain on sale of loans held for sale 6,253 2,330 5,608 12,876 BOLI income 4,312 3,901 2,116 2,000 Operating lease income 7,346 3,377 5,471 6,392 Gain on sale of debt securities available for sale — — — 1,895 Gain (loss) on sale of premises and equipment (9) (248) 2,097 (87) Other 3,645 1,847 3,677 3,386 Total noninterest income 33,449 16,875 31,050 39,109 Total noninterest expense 124,668 59,345 115,909 105,097 Income before income taxes 69,911 35,683 57,164 45,378 Income tax expense 15,106 7,386 12,560 9,725 Net income $ 54,805 $ 28,297 $ 44,604 $ 35,653 Net income per common share – basic $ 3.21 $ 1.67 $ 2.82 $ 2.27 Net income per common share – diluted $ 3.20 $ 1.67 $ 2.80 $ 2.23 At or For the Year Ended December 31, 2024 At or For the Six Months Ended December 31, 2023 At or For the Year Ended June 30, 2023 2022 Performance ratios Return on assets (ratio of net income to average total assets) (1) 1.23 % 1.27 % 1.16 % 1.01 % Return on equity (ratio of net income to average equity) (1) 10.37 11.51 10.43 9.00 Yield on earning assets (1) 6.28 5.96 5.20 3.54 Rate paid on interest-bearing liabilities (1) 3.00 2.66 1.17 0.23 Average interest rate spread (1) 3.28 3.30 4.03 3.31 Net interest margin (1)(2) 4.05 4.02 4.38 3.38 Average interest-earning assets to average interest-bearing liabilities 134.60 136.76 141.23 138.30 Noninterest expense to average total assets (1) 2.81 2.66 3.01 2.97 Efficiency ratio 61.68 58.78 61.50 70.12 Efficiency ratio – adjusted (3) 60.12 59.81 59.12 69.19 26 At or For the Year Ended December 31, 2024 At or For the Six Months Ended December 31, 2023 At or For the Year Ended June 30, 2023 2022 Asset quality ratios Nonperforming assets to total assets (4) 0.63 % 0.41 % 0.18 % 0.18 % Nonperforming loans to total loans (4) 0.76 0.53 0.23 0.22 Total classified assets to total assets 1.06 0.90 0.53 0.61 Allowance for credit losses to nonperforming loans (4) 163.68 251.60 567.56 566.83 Allowance for credit losses to total loans 1.24 1.34 1.29 1.25 Net charge-offs to average loans (1) 0.28 0.28 0.10 (0.02) Capital ratios Equity to total assets at end of period 12.01 % 10.70 % 10.23 % 10.96 % Tangible equity to total tangible assets (3) 11.25 9.91 9.39 10.31 Average equity to average assets 11.90 11.03 11.11 11.20 Dividend payout ratio 13.99 12.53 13.97 15.30 Dividends declared per common share $ 0.45 $ 0.21 $ 0.39 $ 0.35 (1) Ratio is annualized for the six months ended December 31, 2023.
Biggest changeFinancial Highlights (Dollars in thousands) December 31, 2025 December 31, 2024 December 31, 2023 June 30, 2023 Selected financial condition data Total assets $ 4,545,635 $ 4,595,430 $ 4,672,633 $ 4,607,487 Cash and cash equivalents 324,692 279,219 347,140 303,497 Certificates of deposit in other banks 18,841 28,538 34,722 33,152 Debt securities available for sale, at fair value 142,540 152,011 126,950 151,926 Loans, net of ACL and deferred loan fees and costs 3,536,675 3,603,014 3,591,381 3,611,630 Deposits 3,709,997 3,779,203 3,661,373 3,601,168 Junior subordinated debt 10,220 10,120 10,021 9,971 Borrowings 165,000 188,000 433,763 457,263 Stockholders’ equity 600,690 551,758 499,893 471,186 Year Ended December 31, Six Months Ended December 31, 2023 Year Ended June 30, 2023 (Dollars in thousands, except per share data) 2025 2024 Selected operations data Total interest and dividend income $ 256,138 $ 261,616 $ 124,684 $ 187,126 Total interest expense 79,400 92,112 40,144 29,711 Net interest income 176,738 169,504 84,540 157,415 Provision for credit losses 6,938 7,545 5,930 15,392 Net interest income after provision for credit losses 169,800 161,959 78,610 142,023 Service charges and fees on deposit accounts 9,807 9,165 4,686 9,510 Loan income and fees 2,772 2,737 982 2,571 Gain on sale of loans held for sale 7,668 6,253 2,330 5,608 BOLI income 3,552 4,312 3,901 2,116 Operating lease income 7,064 7,346 3,377 5,471 Gain on sale of branches 1,448 — — — Gain (loss) on sale of premises and equipment 93 (9) (248) 2,097 Other 3,927 3,645 1,847 3,677 Total noninterest income 36,331 33,449 16,875 31,050 Total noninterest expense 125,176 125,497 59,802 115,909 Income before income taxes 80,955 69,911 35,683 57,164 Income tax expense 16,591 15,106 7,386 12,560 Net income $ 64,364 $ 54,805 $ 28,297 $ 44,604 Net income per common share – basic $ 3.75 $ 3.21 $ 1.67 $ 2.82 Net income per common share – diluted $ 3.72 $ 3.20 $ 1.67 $ 2.80 26 At or For the Year Ended December 31, At or For the Six Months Ended December 31, 2023 At or For the Year Ended June 30, 2023 2025 2024 Performance ratios Return on assets (ratio of net income to average total assets) (1) 1.46 % 1.23 % 1.27 % 1.16 % Return on equity (ratio of net income to average equity) (1) 11.06 10.37 11.51 10.43 Yield on earning assets (1) 6.16 6.28 5.96 5.20 Rate paid on interest-bearing liabilities (1) 2.62 2.98 2.63 1.17 Average interest rate spread (1) 3.54 3.30 3.33 4.03 Net interest margin (1)(2) 4.25 4.07 4.04 4.38 Average interest-earning assets to average interest-bearing liabilities 137.29 134.60 136.76 141.23 Noninterest expense to average total assets (1) 2.84 2.83 2.68 3.01 Efficiency ratio 58.75 61.84 58.97 61.50 Efficiency ratio – adjusted (3) 58.72 60.28 60.00 59.12 At or For the Year Ended December 31, At or For the Six Months Ended December 31, 2023 At or For the Year Ended June 30, 2023 2025 2024 Asset quality ratios Nonperforming assets to total assets (4) 0.98 % 0.63 % 0.41 % 0.18 % Nonperforming loans to total loans (4) 1.22 0.76 0.53 0.23 Total classified assets to total assets 1.46 1.06 0.90 0.53 Allowance for credit losses to nonperforming loans (4) 94.75 163.68 251.60 567.56 Allowance for credit losses to total loans 1.16 1.24 1.34 1.29 Net charge-offs to average loans (1) 0.24 0.28 0.28 0.10 Capital ratios Equity to total assets at end of period 13.21 % 12.01 % 10.70 % 10.23 % Tangible equity to total tangible assets (3) 12.49 11.25 9.91 9.39 Average equity to average assets 13.19 11.90 11.03 11.11 Dividend payout ratio 13.02 13.99 12.53 13.97 Dividends declared per common share $ 0.49 $ 0.45 $ 0.21 $ 0.39 (1) Ratio is annualized for the six months ended December 31, 2023.
For further information, see “Note 17 – Commitments and Contingencies” of the Notes to Consolidated Financial Statements included in Item 8 of this Form 10-K. 40 Asset/Liability Management and Interest Rate Risk Our Risk When Interest Rates Change. The rates of interest we earn on assets and pay on liabilities generally are established contractually for a period of time.
For further information, see “Note 17 – Commitments and Contingencies” of the Notes to Consolidated Financial Statements included in Item 8 of this Form 10-K. Asset/Liability Management and Interest Rate Risk Our Risk When Interest Rates Change. The rates of interest we earn on assets and pay on liabilities generally are established contractually for a period of time.
See "Note 1 – Summary of Significant Accounting Policies” of the Notes to the Consolidated Financial Statements included in Item 8 of this Form 10-K for further discussion. Our noninterest expenses consist primarily of salaries and employee benefits, occupancy expenses, computer services, operating lease depreciation, marketing and FDIC deposit insurance premiums.
See "Note 1 – Summary of Significant Accounting Policies” of the Notes to the Consolidated Financial Statements included in Item 8 of this Form 10-K for further discussion. 28 Our noninterest expenses consist primarily of salaries and employee benefits, occupancy expenses, computer services, operating lease depreciation, marketing and FDIC deposit insurance premiums.
The committee also evaluates these impacts against the potential changes in net interest income and market value of our portfolio equity that are monitored by the Board of Directors of HomeTrust Bank generally on a quarterly basis. 41 Our asset/liability management strategy sets limits on the change in PVE given certain changes in interest rates.
The committee also evaluates these impacts against the potential changes in net interest income and market value of our portfolio equity that are monitored by the Board of Directors of HomeTrust Bank generally on a quarterly basis. Our asset/liability management strategy sets limits on the change in PVE given certain changes in interest rates.
Interest rate risk is measured by changes in PVE for instantaneous parallel shifts in the yield curve up and down 400 basis points. Overall, our interest rate sensitivity is very low with minimal changes to our PVE with rate increases or smaller rate decreases. Loans with interest rate floors assist in maintaining our net interest income when rates decrease.
Interest rate risk is measured by changes in PVE for instantaneous parallel shifts in the yield curve up and down 400 basis points. Overall, our interest rate sensitivity is very low with minimal changes to our PVE with rate increases or smaller rate decreases. Loans with interest rate 41 floors assist in maintaining our net interest income when rates decrease.
Residential Real Estate – One-to-Four Family . We originate loans secured by first mortgages on one-to-four family residences typically for the purchase or refinance of owner occupied primary or secondary residences located primarily in our market areas. We originate both 35 fixed-rate loans and adjustable-rate loans.
Residential Real Estate – One-to-Four Family . We originate loans secured by first mortgages on one-to-four family residences typically for the purchase or refinance of owner occupied primary or secondary residences located primarily in our market areas. We originate both fixed-rate loans and adjustable-rate loans.
On a longer term basis, we maintain a strategy of investing in various lending products and debt securities, including MBS. On a stand-alone level we are a separate legal entity from the Bank and must provide for our own liquidity and pay our own operating expenses.
On a longer term basis, we maintain a strategy of investing in various lending 40 products and debt securities, including MBS. On a stand-alone level we are a separate legal entity from the Bank and must provide for our own liquidity and pay our own operating expenses.
See "Note 10 – Borrowings" of the Notes to the Consolidated Financial Statements included in Item 8 of this Form 10-K for discussion of the origin and terms of the debt. The following tables set forth information regarding our borrowings at the end of and during the periods indicated.
See "Note 10 – Borrowings" of the Notes to the Consolidated Financial Statements included in Item 8 of this Form 10-K for discussion of the origin and terms of the debt. 39 The following tables set forth information regarding our borrowings at the end of and during the periods indicated.
Maturities are based on the final contractual payment dates, and do not reflect the impact of prepayments or early redemptions that may occur. Weighted average yields were calculated using amortized cost on a fully-taxable equivalent basis. The Company did not hold any tax-exempt debt securities as of December 31, 2024.
Maturities are based on the final contractual payment dates, and do not reflect the impact of prepayments or early redemptions that may occur. Weighted average yields were calculated using amortized cost on a fully-taxable equivalent basis. The Company did not hold any tax-exempt debt securities as of December 31, 2025.
The primary sources are increases in deposit accounts, wholesale borrowings and cash flows from loan payments and the securities portfolio. In addition to these primary sources of funds, management has several secondary sources available to meet potential funding requirements as outlined in the "Comparison of Financial Condition at December 31 , 2024 and December 31, 2023 – Borrowings" section above.
The primary sources are increases in deposit accounts, wholesale borrowings and cash flows from loan payments and the securities portfolio. In addition to these primary sources of funds, management has several secondary sources available to meet potential funding requirements as outlined in the "Comparison of Financial Condition at December 31 , 2025 and December 31, 2024 – Borrowings" section above.
Accretion income on acquired loans of $3.2 million and $2.1 million was recognized during the same periods, respectively, and was included in loan interest income.
Accretion income on acquired loans of $2.2 million and $3.2 million was recognized during the same periods, respectively, and was included in loan interest income.
The table presented here, as of December 31, 2024, is forward-looking information about our sensitivity to changes in interest rates. The table incorporates data from an independent service, as it relates to maturity repricing and repayment/withdrawal of interest-earning assets and interest-bearing liabilities.
The table presented here, as of December 31, 2025, is forward-looking information about our sensitivity to changes in interest rates. The table incorporates data from an independent service, as it relates to maturity repricing and repayment/withdrawal of interest-earning assets and interest-bearing liabilities.
Overview The following discussion and analysis presents the more significant factors that affected our financial condition as of December 31, 2024 and 2023 and results of operations for the years ended December 31, 2024 and December 31, 2023. Refer to "Item 7.
Overview The following discussion and analysis presents the more significant factors that affected our financial condition as of December 31, 2025 and 2024 and results of operations for the years ended December 31, 2025 and 2024. Refer to "Item 7.
For the years ended December 31 , 2024 and December 31 , 2023 , the amounts recorded for off-balance-sheet credit exposure were the result of changes in the balance of loan commitments, loan mix and the projected economic forecast as outlined above.
For the years ended December 31 , 2025 and December 31 , 2024 , the amounts recorded for off-balance sheet credit exposure were the result of changes in the balance of loan commitments, loan mix and the projected economic forecast as outlined above.
SBA 7(a) and USDA B&I loans will normally be adjustable rate loans based upon The Wall Street Journal prime lending rate. Under the loan programs, we will typically sell in the secondary market the guaranteed portion of these loans to generate noninterest income and retain the related unguaranteed portion of these loans.
SBA 7(a) and USDA B&I loans will normally be adjustable rate loans based upon The Wall Street Journal prime lending rate. Under the loan programs, we will typically sell in the secondary market the guaranteed portion of these loans to generate noninterest income and retain the related unguaranteed portion of these loans. Commercial – Equipment Finance .
The following table indicates the amount of our CDs, both within and in excess of the $250,000 FDIC insurance limit, by time remaining until maturity as of December 31, 2024.
The following table indicates the amount of our CDs, both within and in excess of the $250,000 FDIC insurance limit, by time remaining until maturity as of December 31, 2025.
The committee recommends strategy changes based on this review. The committee is responsible for reviewing and reporting on the effects of the policy implementations and strategies to the Board of Directors at least quarterly.
The committee recommends strategy changes based on this review. The committee is responsible for reviewing and reporting on the effects of the policy implementations and strategies to the Asset/Liability Committee of the Board of Directors at least quarterly.
The loans have terms ranging from 24 to 96 months, with an average of five years, and are secured by the financed equipment. Typical transaction sizes range from $10,000 to $4.0 million, with an average outstanding loan balance of $140,000. Commercial – Municipal Leases .
The loans have terms ranging from 24 to 96 months, with an average of five years, and are secured by the financed equipment. Typical transaction sizes range from $10,000 to $4.0 million, with an average outstanding loan balance of $134,000. 34 Commercial – Municipal Leases .
See further discussion of the drivers of the change in the "Comparison of Results of Operations for the Years Ended December 31, 2024 and December 31, 2023 – Provision for Credit Losses" section above.
See further discussion of the drivers of the change in the "Comparison of Results of Operations for the Years Ended December 31, 2025 and December 31, 2024 – Provision for Credit Losses" section above.
In addition to borrowings deemed necessary to address funding needs, as a result of our merger with Quantum, we assumed $11.3 million of junior subordinated debentures, which carried a purchase accounting discount of $1.2 million as of December 31, 2024.
In addition to borrowings deemed necessary to address funding needs, as a result of our merger with Quantum, we assumed $11.3 million of junior subordinated debentures, which carried a purchase accounting discount of $1.1 million as of December 31, 2025.
At December 31, 2024, unfunded commitments on these lines of credit, including loans held for sale, totaled $436.0 million. Consumer Lending . Our consumer loans consist of loans secured by deposit accounts or personal property such as automobiles, boats and motorcycles, as well as unsecured consumer debt.
Unfunded commitments on these lines of credit, including loans held for sale, totaled $491.2 million and $436.0 million at December 31, 2025 and 2024, respectively. Consumer Lending . Our consumer loans consist of loans secured by deposit accounts or personal property such as automobiles, boats and motorcycles, as well as unsecured consumer debt.
In an effort to assist customers in their post-Hurricane Helene recovery and clean-up efforts, in the quarter ended December 31, 2024 we granted payment deferrals of up to six months to provide short-term relief to impacted customers. The outstanding balance of these deferrals was $136.0 million at December 31, 2024.
In an effort to assist customers in their post-Hurricane Helene recovery and clean-up efforts, in the fourth quarter of 2024 we granted payment deferrals of up to six months to provide short-term relief to impacted customers, the outstanding balance of which was $136.0 million at December 31, 2024.
All of our construction and land/lot loans were made on properties located within our market area. Unfunded loan commitments totaled $29.8 million and $60.4 million at December 31, 2024 and 2023, respectively. Construction-to-permanent loans are made for the construction of a one-to-four family property which is intended to be occupied by the borrower as either a primary or secondary residence.
All of our construction and land/lot loans were made on properties located within our market area. Unfunded loan commitments totaled $38.7 million and $29.8 million at December 31, 2025 and 2024, respectively. Construction-to-permanent loans are made for the construction of a one-to-four family property which is intended to be occupied by the borrower as either a primary or secondary residence.
Loans to finance the construction of speculative single-family homes are generally offered to experienced builders with a proven track record of performance. These loans require interest-only payments during the construction phase. Unfunded commitments on these loans were $67.6 million and $53.4 million at December 31, 2024 and 2023, respectively. Both adjustable and fixed rates are offered on commercial construction loans.
Loans to finance the construction of speculative single-family homes are generally offered to experienced builders with a proven track record of performance. These loans require interest-only payments during the construction phase. Unfunded commitments on these loans were $75.0 million and $67.6 million at December 31, 2025 and 2024, respectively. Both adjustable and fixed rates are offered on commercial construction loans.
The following represent our critical accounting policies: Allowance for Credit Losses, or ACL, on Loans. The ACL on loans held for investment reflects our estimate of credit losses that will result from the inability of our borrowers to make required loan payments.
The following represents our critical accounting policy: Allowance for Credit Losses, or ACL, on Loans. The ACL on loans held for investment reflects our estimate of credit losses that will result from the inability of our borrowers to make required loan payments.
Our primary source of funds consists of dividends or capital distributions from the Bank, although there are regulatory restrictions on the ability of the Bank to pay dividends. At December 31, 2024, we (on an unconsolidated basis) had liquid assets of $1.1 million.
Our primary source of funds consists of dividends or capital distributions from the Bank, although there are regulatory restrictions on the ability of the Bank to pay dividends. At December 31, 2025, we (on an unconsolidated basis) had liquid assets of $8.3 million.
Individually evaluated loans may be evaluated for ACL purposes using either the cash flow or the collateral valuation method. As of December 31, 2024, there were $13.8 million of loans individually evaluated compared to $8.8 million at December 31, 2023. The following table summarizes net charge-offs (recoveries) to average loans outstanding by loan category as of the dates indicated.
Individually evaluated loans may be evaluated for ACL purposes using either the cash flow or the collateral valuation method. As of December 31, 2025, there were $11.5 million of loans individually evaluated compared to $13.8 million at December 31, 2024. 38 The following table summarizes net charge-offs (recoveries) to average loans outstanding by loan category for the years indicated.
We recognize in net income the amount needed to adjust the ACL on loans held for investment and certain off-balance-sheet credit exposures for management’s current estimate of ECLs. Our ACL on loans held for investment is calculated using collectively evaluated and individually evaluated loans. Business Combinations, Core Deposit Intangible and Acquired Loans.
We recognize in net income the amount needed to adjust the ACL on loans held for investment and certain off-balance sheet credit exposures for management’s current estimate of ECLs. Our ACL on loans held for investment is calculated using collectively evaluated and individually evaluated loans.
We consider the relatively short duration of our deposits in our overall asset/liability management process. As short-term rates increase, we have assets and liabilities that increase with the market. This is reflected in the change in our PVE when rates increase (see the table below). PVE is defined as the net present value of our existing assets and liabilities.
We consider the relatively short duration of our loans and deposits in our overall asset/liability management process. As short-term rates increase, we have assets and liabilities that increase with the market. This is reflected in the change in our PVE when rates increase (see the table below).
We originate commercial real estate loans, including loans secured by retail/wholesale facilities, hotels, industrial facilities, medical and professional buildings, office buildings, churches and multifamily residential properties located primarily in our market areas. The average outstanding loan balance was $957,000 as of December 31, 2024.
We originate commercial real estate loans, including loans secured by retail/wholesale facilities, hotels, industrial facilities, medical and professional buildings, office buildings, churches and multifamily residential properties located primarily in our market areas. The average outstanding loan balance was $1.0 million as of December 31, 2025.
Specific to time deposits, we held approximately $168.1 million in uninsured CDs as of December 31, 2024. The uninsured amount is an estimate consistent with the methodology used for the Company's regulatory reporting disclosures.
Specific to time deposits, we held approximately $198.5 million in uninsured CDs as of December 31, 2025. The uninsured amount is an estimate consistent with the methodology used for the Company's regulatory reporting disclosures.
Specific to 34 our non-owner occupied portfolio, the outstanding balance of loans secured by offices totaled $93.7 million as of December 31, 2024. We offer both fixed- and adjustable-rate commercial real estate loans. Our commercial real estate mortgage loans generally include a balloon maturity of five years or less. Amortization terms are generally limited to 20 years.
Specific to our non-owner occupied portfolio, the outstanding balance of loans secured by offices totaled $97.0 million and $93.7 million as of December 31, 2025 and 2024, respectively. We offer both fixed- and adjustable-rate commercial real estate loans. Our commercial real estate mortgage loans generally include a balloon maturity of five years or less.
At December 31, 2024 and 2023, the Company had the ability to borrow $315.5 million and $72.8 million, respectively, through FHLB advances and $106.6 million and $55.3 million, respectively, through the unused portion of a line of credit with the FRB.
At December 31, 2025 and 2024, the Company had the ability to borrow $355.3 million and $315.5 million, respectively, through FHLB advances and $66.3 million and $106.6 million, respectively, through the unused portion of a line of credit with the FRB.
Total liabilities were $4.0 billion at December 31, 2024, compared to $4.2 billion at December 31, 2023, a decrease of $129.1 million, or 3.1%, period-over-period, the components of which are discussed below. Deposits. The following table summarizes the composition of our deposit portfolio as of the dates indicated.
Total liabilities were $3.9 billion at December 31, 2025, compared to $4.0 billion at December 31, 2024, a decrease of $98.7 million, or 2.4%, the components of which are discussed below. Deposits. The following table summarizes the composition of our deposit portfolio as of the dates indicated.
Total nonperforming assets were $28.8 million, or 0.63% of total assets, at December 31, 2024, compared to $19.3 milion, or 0.41% of total assets, at December 31, 2023. The following table sets forth the composition of our nonperforming assets among our different asset categories.
Total nonperforming assets were $44.4 million, or 0.98% of total assets, at December 31, 2025, compared to $28.8 milion, or 0.63% of total assets, at December 31, 2024. The following table sets forth the composition of our nonperforming assets among our different asset categories.
At December 31, 2024, the total approved loan commitments and unused lines of credit outstanding amounted to $230.5 million and $712.3 million, respectively, as compared to $240.9 million and $690.6 million as of December 31, 2023. Certificates of deposit scheduled to mature in one year or less at December 31, 2024 totaled $976.9 million.
At December 31, 2025, the total approved loan commitments and unused lines of credit outstanding amounted to $347.6 million and $831.3 million, respectively, as compared to $230.5 million and $712.3 million as of December 31, 2024. Certificates of deposit scheduled to mature in one year or less at December 31, 2025 totaled $882.2 million.
At December 31, 2024, brokered deposits totaled $387.1 million, or 10.2% of total deposits. Liquidity management is both a daily and long-term function of business management. Excess liquidity is generally invested in short-term investments, such as overnight deposits and federal funds.
At December 31, 2025, brokered deposits totaled $271.3 million, or 7.3% of total deposits. Liquidity management is both a daily and long-term function of business management. Excess liquidity is generally invested in short-term investments, such as overnight deposits and federal funds.
Management’s Discussion and Analysis of Financial Condition and Results of Operations" included in our Transition Report on Form 10-KT filed with the SEC on March 12, 2024 (the “2023 Form 10-KT") for a discussion and analysis of the more significant factors that affected periods prior to the year ended December 31, 2024.
Management’s Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K filed with the SEC on March 13, 2025 (the “2024 Form 10-K") for a discussion and analysis of the more significant factors that affected periods prior to the year ended December 31, 2025.
Outside of changes in value, the changes between years were the result of $28.7 million in proceeds from the maturity, call and paydown of securities offset by $52.8 million in purchases. All purchases were residential MBS and consistent with the composition of the existing securities held in the portfolio.
Outside of changes in value, the changes between years were the result of $36.6 million in proceeds from the maturity, call and paydown of securities, partially offset by $23.0 million in purchases. All purchases were residential MBS and consistent with the composition of the existing securities held in the portfolio.
See further discussion in the "Comparison of Financial Condition at December 31 , 2024 and December 31 , 2023 – Allowance for Credit Losses on Loans" section below. 31 Noninterest Income. Noninterest income for the year ended December 31, 2024 increased $1.4 million, or 4.3%, when compared to the year ended December 31, 2023.
See further discussion in the "Comparison of Financial Condition at December 31 , 2025 and December 31 , 2024 – Allowance for Credit Losses on Loans" section below. 31 Noninterest Income. Noninterest income for the year ended December 31, 2025 increased $2.9 million, or 8.6%, when compared to last year.
In addition, we have historically demonstrated an ability to maintain retail deposits through various interest rate cycles. If local retail deposit rates increase dramatically, we also have access to wholesale funding through our lines of credit with the FHLB and FRB and the brokered deposit market to replace retail deposits, as needed.
If local retail deposit rates increase dramatically, we also have access to wholesale funding through our lines of credit with the FHLB and FRB and the brokered deposit market to replace retail deposits, as needed.
The results for the year ended December 31, 2024 compared to the prior year were positively impacted by a $7.6 million decrease in the provision for credit losses and a $1.4 million increase in noninterest income, partially offset by a $758,000 decrease in net interest income and a $1.6 million increase in noninterest expense.
The results for the year ended December 31, 2025 compared to the prior year were positively impacted by a $7.2 million increase in net interest income, a $2.9 million increase in noninterest income, a $607,000 decrease in the provision for credit losses and a $321,000 decrease in noninterest expense.
As of December 31, 2024, our loans with interest rate floors totaled approximately $749.0 million, or 20.5% of our total loan portfolio, and had a weighted average floor rate of 5.45%, of which $113.0 million were at their floor rate.
As of December 31, 2025, our loans with interest rate floors totaled approximately $744.9 million, or 20.8% of our total loan portfolio, and had a weighted average floor rate of 5.03%, of which $155.1 million were at their floor rate.
(4) Tax-equivalent results include adjustments to interest income of $1,460 and $1,244 for the years ended December 31, 2024 and 2023, respectively, calculated based on a combined federal and state tax rate of 24%.
(4) Tax-equivalent results include adjustments to interest income of $1,737 and $1,460 for the years ended December 31, 2025 and 2024, respectively, calculated based on a combined federal and state tax rate of 24%. Total interest and dividend income for the year ended December 31, 2025 decreased $5.5 million, or 2.1%, compared to the year ended December 31, 2024.
Our land, lots and development loans are predominately for the purchase or refinance of unimproved land held for future residential development, improved residential lots held for speculative investment purposes and for the future construction of one-to-four family (speculative and pre-sold) or commercial real estate.
Our land, lots and development loans are predominately for the purchase or refinance of unimproved land held for future residential development, improved residential lots held for speculative investment purposes and for the future construction of one-to-four family (speculative and pre-sold) or commercial real estate. Unfunded commitments totaled $111.9 million and $48.1 million at December 31, 2025 and 2024, respectively.
December 31, 2024 December 31, 2023 (Dollars in thousands) Allocated Allowance % of Loan Portfolio ACL to Loans Allocated Allowance % of Loan Portfolio ACL to Loans Commercial real estate loans Construction and land development $ 3,541 8 % 0.10 % $ 4,591 8 % 0.13 % Commercial real estate - owner occupied 5,465 15 0.15 5,647 15 0.16 Commercial real estate - non-owner occupied 9,074 24 0.25 9,187 24 0.25 Multifamily 1,204 3 0.03 898 2 0.02 Total commercial real estate loans 19,284 50 0.53 20,323 49 0.56 Commercial loans Commercial and industrial 4,837 9 0.13 4,994 7 0.14 Equipment finance 10,090 11 0.28 11,843 13 0.32 Municipal leases 340 5 0.01 189 4 0.01 Total commercial loans 15,267 25 0.42 17,026 24 0.47 Residential real estate loans Construction and land development 465 1 0.01 1,203 3 0.03 One-to-four family 7,441 17 0.20 6,302 16 0.17 HELOCs 1,758 5 0.05 1,779 5 0.05 Total residential real estate loans 9,664 23 0.26 9,284 24 0.25 Consumer loans 1,070 2 0.03 2,008 3 0.06 Total loans $ 45,285 100 % 1.24 % $ 48,641 100 % 1.34 % December 31, 2024 December 31, 2023 (Dollars in thousands) Allocated Allowance ACL to Loans Allocated Allowance ACL to Loans ACL composition Quantitative allocation $ 22,330 0.61 % $ 23,664 0.65 % Qualitative allocation 21,880 0.60 22,858 0.63 Individual allocation 1,075 0.03 2,119 0.06 Total ACL $ 45,285 1.24 % $ 48,641 1.34 % At or For the Year Ended December 31, 2024 At or For the Year Ended December 31, 2023 At or For the Year Ended June 30, 2023 Asset quality ratios ACL to nonaccruing loans (1) 163.68 % 251.60 % 567.56 % Net charge-offs to average loans 0.28 0.18 0.10 (1) At December 31, 2024, $13.0 million, or 47.1%, of nonaccruing loans were current on their loan payments.
December 31, 2025 December 31, 2024 (Dollars in thousands) Allocated Allowance % of Loan Portfolio ACL to Loans Allocated Allowance % of Loan Portfolio ACL to Loans Commercial real estate Construction and land development $ 3,948 8 % 0.11 % $ 3,541 8 % 0.10 % Commercial real estate - owner occupied 5,404 16 0.15 5,465 15 0.15 Commercial real estate - non-owner occupied 8,908 23 0.25 9,074 24 0.25 Multifamily 1,038 3 0.03 1,204 3 0.03 Total commercial real estate 19,298 50 0.54 19,284 50 0.53 Commercial Commercial and industrial 4,894 10 0.14 4,837 9 0.13 Equipment finance 8,110 9 0.22 10,090 11 0.28 Municipal leases 327 5 0.01 340 5 0.01 Total commercial 13,331 24 0.37 15,267 25 0.42 Residential real estate Construction and land development 307 1 0.01 465 1 0.01 One-to-four family 6,342 18 0.18 7,441 17 0.20 HELOCs 1,843 6 0.05 1,758 5 0.05 Total residential real estate 8,492 25 0.24 9,664 23 0.26 Consumer 358 1 0.01 1,070 2 0.03 Total loans $ 41,479 100 % 1.16 % $ 45,285 100 % 1.24 % December 31, 2025 December 31, 2024 (Dollars in thousands) Allocated Allowance ACL to Loans Allocated Allowance ACL to Loans ACL composition Quantitative allocation $ 22,832 0.64 % $ 22,330 0.61 % Qualitative allocation 17,359 0.50 21,880 0.60 Individual allocation 1,288 0.02 1,075 0.03 Total ACL $ 41,479 1.16 % $ 45,285 1.24 % At or For the Year Ended December 31, 2025 2024 Asset quality ratios ACL to nonaccruing loans (1) 94.75 % 163.68 % Net charge-offs to average loans 0.24 0.28 (1) At December 31, 2025, $10.1 million, or 23.2%, of nonaccruing loans were current on their loan payments.
At December 31, 2024 and 2023, the Company maintained revolving lines of credit with three unaffiliated banks, the unused portion of which totaled $165.0 million and $146.2 million, respectively. Capital Resources Stockholders' equity increased $51.9 million, or 10.4%, to $551.8 million at December 31, 2024 as compared to December 31, 2023.
At both December 31, 2025 and 2024, the Company maintained revolving lines of credit with four unaffiliated banks, the unused portion of which totaled $165.0 million. Capital Resources Stockholders' equity increased $48.9 million, or 8.9%, to $600.7 million at December 31, 2025 as compared to December 31, 2024.
At December 31, 2024, $106.7 million, or 64.3%, of our municipal leases were secured by fire trucks, $51.7 million, or 31.2%, were secured by fire stations, with the remaining $7.6 million, or 4.5%, secured by miscellaneous firefighting equipment and land. At December 31, 2024, the average outstanding municipal lease balance was $454,000.
At December 31, 2025, $105.6 million, or 63.5%, of our municipal leases were secured by fire trucks, $54.3 million, or 32.6%, were secured by fire stations, with the remaining $6.5 million, or 3.9%, secured by miscellaneous firefighting equipment and land. At December 31, 2025, the average outstanding municipal lease balance was $436,000.
The Company then records the necessary ACL on the non-PCD loans through provision for credit losses expense. 28 Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, see “Note 1 – Summary of Significant Accounting Policies" of the Notes to the Consolidated Financial Statements in Item 8 of this report on Form 10-K for further discussion.
Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, see “Note 1 – Summary of Significant Accounting Policies" of the Notes to the Consolidated Financial Statements in Item 8 of this report on Form 10-K for further discussion.
For the year ended December 31 , 2023 , the "loans" portion of the provision for credit losses was the result of the following, offset by net charge-offs of $6.7 million during the period: • $4.9 million provision to establish an allowance on Quantum's loan portfolio. • $1.4 million provision driven by changes in the loan mix. • $2.1 million provision due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments. • $1.1 million increase in specific reserves on individually evaluated credits.
For the year ended December 31 , 2024 , the "loans" portion of the provision for credit losses was the result of the following, offset by net charge-offs of $10.8 million during the period: • $1.6 million benefit driven by changes in the loan mix. • $0.7 million benefit due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments.
GAAP Reconciliation of Non-GAAP Financial Measures We believe the non-GAAP financial measures included above provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with US GAAP; however, we acknowledge that our non-GAAP financial measures have a number of limitations.
At December 31, 2025, $10.1 million, or 23.2%, of nonaccruing loans were current on their loan payments. 27 GAAP Reconciliation of Non-GAAP Financial Measures We believe the non-GAAP financial measures included above provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with US GAAP; however, we acknowledge that our non-GAAP financial measures have a number of limitations.
Year Ended December 31, (Dollars in thousands) 2024 2023 Average balances Junior subordinated debentures $ 10,067 $ 8,826 FHLB advances 24,784 116,842 FRB advances 25,635 23,907 Revolving lines of credit 10,785 67,233 Weighted average interest rate Junior subordinated debentures 9.22 % 9.11 % FHLB advances 5.55 5.29 FRB advances 5.41 5.34 Revolving lines of credit 9.12 8.90 39 (Dollars in thousands) December 31, 2024 December 31, 2023 Balance outstanding at end of period Junior subordinated debentures $ 10,120 $ 10,021 FHLB advances — 105,000 FRB advances 188,000 310,000 Revolving lines of credit — 18,763 Weighted average interest rate Junior subordinated debentures 6.51 % 7.59 % FHLB advances — 5.44 FRB advances 4.50 5.50 Revolving lines of credit — 9.00 All qualifying one-to-four family loans, HELOCs, commercial real estate loans and FHLB of Atlanta stock are pledged as collateral to secure outstanding FHLB advances while commercial construction, indirect auto and municipal leases are pledged as collateral to secure outstanding FRB advances.
Year Ended December 31, (Dollars in thousands) 2025 2024 Average balances Junior subordinated debentures $ 10,167 $ 10,067 FHLB advances 903 24,784 FRB advances 20,145 25,635 Revolving lines of credit — 10,785 Weighted average interest rate Junior subordinated debentures 8.04 % 9.22 % FHLB advances 4.57 5.55 FRB advances 4.66 5.41 Revolving lines of credit — 9.12 (Dollars in thousands) December 31, 2025 December 31, 2024 Balance outstanding at end of period Junior subordinated debentures $ 10,220 $ 10,120 FHLB advances — — FRB advances 165,000 188,000 Revolving lines of credit — — Weighted average interest rate Junior subordinated debentures 5.85 % 6.51 % FHLB advances — — FRB advances 3.75 4.50 Revolving lines of credit — — All qualifying one-to-four family loans, HELOCs, commercial real estate loans, multifamily loans and FHLB of Atlanta stock are pledged as collateral to secure outstanding FHLB advances while commercial construction loans, indirect auto loans, and equipment and municipal leases are pledged as collateral to secure outstanding FRB advances.
Set forth below is a reconciliation to US GAAP of our efficiency ratio: Year Ended December 31, 2024 Six Months Ended December 31, 2023 Year Ended June 30, (Dollars in thousands) 2023 2022 Noninterest expense $ 124,668 $ 59,345 $ 115,909 $ 105,097 Less: officer transition agreement expense — — — 1,795 Less: merger-related expenses — — 5,465 — Less: contract renewal consulting fee 2,965 — — — Noninterest expense – adjusted $ 121,703 $ 59,345 $ 110,444 $ 103,302 Net interest income $ 168,675 $ 84,083 $ 157,415 $ 110,774 Plus: tax equivalent adjustment 1,460 656 1,163 1,231 Plus: noninterest income 33,449 16,875 31,050 39,109 Less: BOLI death benefit proceeds in excess of cash surrender value 1,143 2,646 — — Less: gain on sale of available for sale and equity securities — — 721 1,895 Less: gain (loss) on sale of premises and equipment (9) (248) 2,097 (87) Net interest income plus noninterest income – adjusted $ 202,450 $ 99,216 $ 186,810 $ 149,306 Efficiency ratio 61.68 % 58.78 % 61.50 % 70.12 % Efficiency ratio – adjusted 60.12 % 59.81 % 59.12 % 69.19 % Set forth below is a reconciliation to US GAAP of tangible book value and tangible book value per share: (Dollars in thousands, except per share data) December 31, 2024 December 31, 2023 June 30, 2023 June 30, 2022 Total stockholders' equity $ 551,758 $ 499,893 $ 471,186 $ 388,845 Less: goodwill, core deposit intangibles, net of taxes 39,189 41,086 42,410 25,710 Tangible book value $ 512,569 $ 458,807 $ 428,776 $ 363,135 Common shares outstanding 17,527,709 17,387,069 17,366,673 15,591,466 Book value per share $ 31.48 $ 28.75 $ 27.13 $ 24.94 Tangible book value per share $ 29.24 $ 26.39 $ 24.69 $ 23.29 27 Set forth below is a reconciliation to US GAAP of tangible equity to tangible assets: (Dollars in thousands) December 31, 2024 December 31, 2023 June 30, 2023 June 30, 2022 Tangible equity (1) $ 512,569 $ 458,807 $ 428,776 $ 363,135 Total assets 4,595,430 4,672,633 4,607,487 3,549,204 Less: goodwill, core deposit intangibles, net of taxes 39,189 41,086 42,410 25,710 Total tangible assets $ 4,556,241 $ 4,631,547 $ 4,565,077 $ 3,523,494 Tangible equity to tangible assets 11.25 % 9.91 % 9.39 % 10.31 % (1) Tangible equity (or tangible book value) is equal to total stockholders' equity less goodwill and core deposit intangibles, net of related deferred tax liabilities.
Set forth below is a reconciliation to US GAAP of our efficiency ratio: Year Ended December 31, Six Months Ended December 31, 2023 Year Ended June 30, 2023 (Dollars in thousands) 2025 2024 Noninterest expense $ 125,176 $ 125,497 $ 59,802 $ 115,909 Less: merger-related expenses — — — 5,465 Less: contract renewal consulting fee — 2,965 — — Noninterest expense – adjusted $ 125,176 $ 122,532 $ 59,802 $ 110,444 Net interest income $ 176,738 $ 169,504 $ 84,540 $ 157,415 Plus: tax equivalent adjustment 1,737 1,460 656 1,163 Plus: noninterest income 36,331 33,449 16,875 31,050 Less: BOLI death benefit proceeds in excess of cash surrender value 92 1,143 2,646 — Less: gain on sale of branches 1,448 — — — Less: gain on sale of available for sale and equity securities — — — 721 Less: gain (loss) on sale of premises and equipment 93 (9) (248) 2,097 Net interest income plus noninterest income – adjusted $ 213,173 $ 203,279 $ 99,673 $ 186,810 Efficiency ratio 58.75 % 61.84 % 58.97 % 61.50 % Efficiency ratio – adjusted 58.72 % 60.28 % 60.00 % 59.12 % Set forth below is a reconciliation to US GAAP of tangible book value and tangible book value per share: (Dollars in thousands, except per share data) December 31, 2025 December 31, 2024 December 31, 2023 June 30, 2023 Total stockholders' equity $ 600,690 $ 551,758 $ 499,893 $ 471,186 Less: goodwill, core deposit intangibles, net of taxes 37,844 39,189 41,086 42,410 Tangible book value $ 562,846 $ 512,569 $ 458,807 $ 428,776 Common shares outstanding 17,286,289 17,527,709 17,387,069 17,366,673 Book value per share $ 34.75 $ 31.48 $ 28.75 $ 27.13 Tangible book value per share $ 32.56 $ 29.24 $ 26.39 $ 24.69 Set forth below is a reconciliation to US GAAP of tangible equity to tangible assets: (Dollars in thousands) December 31, 2025 December 31, 2024 December 31, 2023 June 30, 2023 Tangible equity (1) $ 562,846 $ 512,569 $ 458,807 $ 428,776 Total assets 4,545,635 4,595,430 4,672,633 4,607,487 Less: goodwill, core deposit intangibles, net of taxes 37,844 39,189 41,086 42,410 Total tangible assets $ 4,507,791 $ 4,556,241 $ 4,631,547 $ 4,565,077 Tangible equity to tangible assets 12.49 % 11.25 % 9.91 % 9.39 % (1) Tangible equity (or tangible book value) is equal to total stockholders' equity less goodwill and core deposit intangibles, net of related deferred tax liabilities.
At December 31, 2024, $13.0 million, or 47.1%, of nonaccruing loans were current on their loan payments.
At December 31, 2024, $13.0 million, or 47.1%, of nonaccruing loans were current on their loan payments. The ACL on loans decreased $3.8 million, or 8.4%, during the year ended December 31, 2025.
The following table presents a breakdown of the components of the provision for credit losses: Years Ended December 31, (Dollars in thousands) 2024 2023 $ Change % Change Provision for credit losses Loans $ 7,460 $ 16,170 $ (8,710) (54) % Off-balance-sheet credit exposure 85 (1,075) 1,160 108 Total provision for credit losses $ 7,545 $ 15,095 $ (7,550) (50) % For the year ended December 31 , 2024 , the "loans" portion of the provision for credit losses was the result of the following, offset by net charge-offs of $10.8 million during the period: • $1.6 million benefit driven by changes in the loan mix. • $0.7 million benefit due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments. • $1.0 million decrease in specific reserves on individually evaluated credits.
The following table presents a breakdown of the components of the provision for credit losses: Years Ended December 31, (Dollars in thousands) 2025 2024 $ Change % Change Provision for credit losses Loans $ 5,465 $ 7,460 $ (1,995) (27) % Off-balance sheet credit exposure 1,473 85 1,388 1,633 Total provision for credit losses $ 6,938 $ 7,545 $ (607) (8) % For the year ended December 31 , 2025 , the "loans" portion of the provision for credit losses was the result of the following, offset by net charge-offs of $9.3 million during the period: • $2.5 million benefit driven by changes in the loan mix. • $1.5 million benefit due to changes in the projected economic forecast, specifically the national unemployment rate, and changes in qualitative adjustments.
Adjustable rate-based loans typically include a floor and ceiling interest rate and are indexed to The Wall Street Journal prime rate or the one-month term SOFR, plus or minus an interest rate margin and rates generally adjust daily. The maximum loan-to-value ratio for commercial real estate loans is generally up to 80% on purchases and refinances.
Amortization terms are generally offered up to 25 years. Adjustable rate-based loans typically include a floor and ceiling interest rate and are indexed to The Wall Street Journal prime rate or the one-month term SOFR, plus or minus an interest rate margin and rates generally adjust daily.
Total assets were $4.6 billion and $4.7 billion at December 31, 2024 and December 31, 2023, respectively, a decrease of $77.2 million, or 1.7%, period-over-period, the components of which are discussed below. Debt Securities Available for Sale. Debt securities available for sale increased $25.1 million, or 19.7%, to $152.0 million at December 31, 2024.
Total assets were $4.5 billion and $4.6 billion at December 31, 2025 and 2024, respectively, a decrease of $49.8 million, or 1.1%, the components of which are discussed below. Debt Securities Available for Sale. Debt securities available for sale decreased $9.5 million, or 6.2%, to $142.5 million at December 31, 2025.
The following table details the contractual maturity ranges of our loan portfolio without factoring in scheduled payments or potential prepayments. Loan balances do not include undisbursed loan proceeds, unearned discounts, unearned income or the ACL. In addition, we have disclosed those loans with predetermined (fixed) and floating interest rates at December 31, 2024.
Loan balances do not include undisbursed loan proceeds, unearned discounts, unearned income or the ACL. In addition, we have disclosed those loans with predetermined (fixed) and floating interest rates at December 31, 2025.
Comparison of Results of Operations for the Years Ended December 31 , 2024 and December 31, 2023 Net Income. Net income totaled $54.8 million, or $3.20 per diluted share, for the year ended December 31, 2024 compared to $50.0 million, or $2.97 per diluted share, for the year ended December 31, 2023, an increase of $4.8 million, or 9.5%.
Net income totaled $64.4 million, or $3.72 per diluted share, for the year ended December 31, 2025 compared to $54.8 million, or $3.20 per diluted share, for the year ended December 31, 2024, an increase of $9.6 million, or 17.4%.
The amount of income tax expense is influenced by the amount of pre-tax income, tax-exempt income, changes in the statutory rate and the effect of changes in valuation allowances maintained against deferred tax benefits. The effective tax rates for the years ended December 31, 2024 and 2023 were 21.6% and 21.0%, respectively.
Income Taxes. The amount of income tax expense is influenced by the amount of pre-tax income, tax-exempt income, changes in the statutory rate and the effect of changes in valuation allowances maintained against deferred tax benefits.
Loans held for investment totaled $3.6 billion at December 31, 2024, an increase of $8.3 million or 0.2%. The following table illustrates the changes within the portfolio.
Loans held for investment totaled $3.6 billion at December 31, 2025, a decrease of $70.1 million, or 1.9%, compared to the balance as of December 31, 2024. The following table illustrates the changes within the portfolio.
During the year ended December 31, 2024, there were $48.7 million of sales of the guaranteed portion of SBA commercial loans with gains of $3.9 million compared to $46.7 million sold with gains of $3.0 million during the prior year, with the improvement in profitability due to more favorable pricing on the secondary market.
There were $40.4 million of sales of the guaranteed portion of SBA commercial loans with gains of $3.0 million compared to $48.7 million sold with gains of $3.9 million during the prior year.
We originate commercial business loans made under the SBA 7(a) and USDA B&I programs to small businesses located throughout the country.
The interest rates on such loans are either fixed rate or adjustable rate indexed to The Wall Street Journal prime rate plus a margin. We originate commercial business loans made under the SBA 7(a) and USDA B&I programs to small businesses located throughout the country.
As a result of our decision to cease indirect auto finance loan originations as of March 31, 2024, the outstanding balance of the indirect auto portfolio declined to $69.1 million at December 31, 2024, a $37.9 million, or 35.4%, decrease compared to the prior year end.
As a result of our decision to cease indirect auto finance loan originations as of March 31, 2024, the outstanding balance of the indirect auto portfolio declined to $38.3 million at December 31, 2025, a $30.8 million, or 44.5%, decrease compared to the prior year end. 35 The following table details the contractual maturity ranges of our loan portfolio without factoring in scheduled payments or potential prepayments.
There were $95.4 million of HELOCs sold during the current year with gains of $887,000 compared to $104.0 million sold with gains of $873,000 in the prior year. There were $82.0 million of residential mortgages originated for sale sold with gains of $1.4 million compared to $69.3 million sold with gains of $1.1 million in the prior year.
There were $113.5 million of residential mortgage loans originated for sale which were sold with gains of $2.4 million compared to $82.0 million sold with gains of $1.4 million in the prior year.
Year Ended December 31, 2024 Year Ended December 31, 2023 (Dollars in thousands) Net Charge-Offs (Recoveries) Average Loans Outstanding Net Charge-Off (Recovery) Ratio Net Charge-Offs (Recoveries) Average Loans Outstanding Net Charge-Off (Recovery) Ratio Commercial real estate loans $ 343 $ 1,910,402 0.02 % $ 285 $ 1,896,991 0.02 % Commercial loans 9,667 919,564 1.05 6,156 860,410 0.72 Residential real estate loans (119) 921,207 (0.01) (285) 858,552 (0.03) Consumer loans 925 93,811 0.99 601 116,843 0.51 Total $ 10,816 $ 3,844,984 0.28 % $ 6,757 $ 3,732,796 0.18 % 38 Liabilities.
Year Ended December 31, 2025 Year Ended December 31, 2024 (Dollars in thousands) Net Charge-Offs (Recoveries) Average Loans Outstanding Net Charge-Off (Recovery) Ratio Net Charge-Offs (Recoveries) Average Loans Outstanding Net Charge-Off (Recovery) Ratio Commercial real estate $ 190 $ 1,890,942 0.01 % $ 343 $ 1,910,402 0.02 % Commercial 8,567 933,373 0.92 9,667 919,564 1.05 Residential real estate 106 943,292 0.01 (119) 921,207 (0.01) Consumer 408 55,712 0.73 925 93,811 0.99 Total $ 9,271 $ 3,823,319 0.24 % $ 10,816 $ 3,844,984 0.28 % Liabilities.
Total interest expense for the year ended December 31, 2024 increased $27.9 million, or 42.9%, compared to the year ended December 31, 2023, the result of a $33.0 million, or 59.8%, increase in interest expense on deposits and a $5.3 million, or 58.4%, decrease in interest expense on borrowings.
Total interest expense for the year ended December 31, 2025 decreased $12.7 million, or 13.8%, compared to the year ended December 31, 2024, the result of a $9.8 million, or 11.2%, decrease in interest expense on deposits and a $2.8 million, or 73.8%, decrease in interest expense on other borrowings.
The renewal will result both in future cost savings and the expansion of our technology solutions, supporting the Company's growth initiatives and digital strategies all with the goal of enhancing the customer experience. Item(s) of Note – Year Ended December 31, 2023 On February 12, 2023, the Company merged with Quantum which operated two locations in the Atlanta metro area.
The renewal will result both in future cost savings and the expansion of our technology solutions, supporting the Company's growth initiatives and digital strategies all with the goal of enhancing the customer experience. Comparison of Results of Operations for the Years Ended December 31 , 2025 and December 31, 2024 Net Income.
(Dollars in thousands) December 31, 2024 December 31, 2023 $ Change % Change MBS, residential $ 144,147 $ 104,499 $ 39,648 38 % Municipal bonds 3,396 3,409 (13) — Corporate bonds 4,468 19,042 (14,574) (77) Total $ 152,011 $ 126,950 $ 25,061 20 % The composition and contractual maturities of our debt securities portfolio as of December 31, 2024 is indicated in the following table.
(Dollars in thousands) December 31, 2025 December 31, 2024 $ Change % Change MBS, residential $ 136,082 $ 144,147 $ (8,065) (6) % Municipal bonds 1,826 3,396 (1,570) (46) Corporate bonds 4,632 4,468 164 4 Total $ 142,540 $ 152,011 $ (9,471) (6) % The composition and contractual maturities of our debt securities portfolio as of December 31, 2025 is indicated in the following table.
December 31, 2024 December 31, 2023 Change % of Total at December 31, 2024 % of Total at December 31, 2023 (Dollars in thousands) $ % Commercial real estate loans Construction and land development $ 274,356 $ 305,269 $ (30,913) (10) % 8 % 8 % Commercial real estate - owner occupied 545,490 536,545 8,945 2 15 15 Commercial real estate - non-owner occupied 866,094 875,694 (9,600) (1) 24 24 Multifamily 120,425 88,623 31,802 36 3 2 Total commercial real estate loans 1,806,365 1,806,131 234 — 50 49 Commercial loans Commercial and industrial 316,159 237,255 78,904 33 9 7 Equipment finance 406,400 465,573 (59,173) (13) 11 13 Municipal leases 165,984 150,292 15,692 10 5 4 Total commercial loans 888,543 853,120 35,423 4 25 24 Residential real estate loans Construction and land development 53,683 96,646 (42,963) (44) 1 3 One-to-four family 630,391 584,405 45,986 8 17 16 HELOCs 195,288 185,878 9,410 5 5 5 Total residential real estate loans 879,362 866,929 12,433 1 23 24 Consumer loans 74,029 113,842 (39,813) (35) 2 3 Loans, net of deferred loan fees and costs $ 3,648,299 $ 3,640,022 $ 8,277 — % 100 % 100 % The principal categories of our loan portfolio are discussed below.
December 31, 2025 December 31, 2024 Change % of Total at December 31, 2025 % of Total at December 31, 2024 (Dollars in thousands) $ % Commercial real estate loans Construction and land development $ 277,028 $ 274,356 $ 2,672 1 % 8 % 8 % Commercial real estate - owner occupied 562,049 545,490 16,559 3 16 15 Commercial real estate - non-owner occupied 832,502 866,094 (33,592) (4) 23 24 Multifamily 110,912 120,425 (9,513) (8) 3 3 Total commercial real estate loans 1,782,491 1,806,365 (23,874) (1) 50 50 Commercial loans Commercial and industrial 378,686 316,159 62,527 20 10 9 Equipment finance 311,356 406,400 (95,044) (23) 9 11 Municipal leases 166,396 165,984 412 — 5 5 Total commercial loans 856,438 888,543 (32,105) (4) 24 25 Residential real estate loans Construction and land development 45,617 53,683 (8,066) (15) 1 1 One-to-four family 633,511 630,391 3,120 — 18 17 HELOCs 217,310 195,288 22,022 11 6 5 Total residential real estate loans 896,438 879,362 17,076 2 25 23 Consumer loans 42,787 74,029 (31,242) (42) 1 2 Loans, net of deferred loan fees and costs $ 3,578,154 $ 3,648,299 $ (70,145) (2) % 100 % 100 % 33 The principal categories of our loan portfolio are discussed below.
The increase in interest expense on deposits was primarily the result of both increases in the average cost of funds across funding sources and average deposits, while the decrease in interest expense on borrowings was the result of a decline in average borrowings outstanding. 30 The following table shows the effects that changes in average balances (volume), including differences in the number of days in the periods compared, and average interest rates (rate) had on the interest earned on interest-earning assets and interest paid on interest-bearing liabilities: Increase / (Decrease) Due to Total Increase/ (Decrease) (Dollars in thousands) Volume Rate Interest-earning assets Loans receivable $ 9,075 $ 15,972 $ 25,047 Debt securities available for sale (467) 1,475 1,008 Other interest-earning assets 574 506 1,080 Total interest-earning assets 9,182 17,953 27,135 Interest-bearing liabilities Interest-bearing checking accounts (346) 1,316 970 Money market accounts 2,203 10,943 13,146 Savings accounts (25) 1 (24) Certificate accounts 8,673 10,258 18,931 Junior subordinated debt 113 13 126 Borrowings (5,523) 267 (5,256) Total interest-bearing liabilities 5,095 22,798 27,893 Decrease in net interest income $ (758) Provision for Credit Losses.
The decrease in interest expense on deposits can primarily be traced to a decrease in the average cost of funds, while the decrease in interest expense on other borrowings was primarily the result of a decline in average borrowings outstanding. 30 The following table shows the effects that changes in average balances (volume), including differences in the number of days in the periods compared, and average interest rates (rate) had on the interest earned on interest-earning assets and interest paid on interest-bearing liabilities: Increase / (Decrease) Due to Total Increase / (Decrease) (Dollars in thousands) Volume Rate Interest-earning assets Loans receivable $ (3,931) $ (3,312) $ (7,243) Debt securities available for sale 522 139 661 Other interest-earning assets 2,111 (1,007) 1,104 Total interest-earning assets (1,298) (4,180) (5,478) Interest-bearing liabilities Interest-bearing checking accounts (147) (604) (751) Money market accounts 823 (4,026) (3,203) Savings accounts (6) (22) (28) Certificate accounts (1,449) (4,405) (5,854) Junior subordinated debt 9 (120) (111) Borrowings (2,485) (280) (2,765) Total interest-bearing liabilities (3,255) (9,457) (12,712) Increase in net interest income $ 7,234 Provision for Credit Losses.
(Dollars in thousands) December 31, 2024 December 31, 2023 $ Change % Change Core deposits Noninterest-bearing deposits $ 680,926 $ 784,950 $ (104,024) (13) % NOW accounts 575,238 591,270 (16,032) (3) Money market accounts 1,341,995 1,246,807 95,188 8 Savings accounts 181,317 194,486 (13,169) (7) Total core deposits $ 2,779,476 $ 2,817,513 (38,037) (1) Certificates of deposit 999,727 843,860 155,867 18 Total $ 3,779,203 $ 3,661,373 $ 117,830 3 % The following bullet points provide further information regarding the composition of our deposit portfolio as of December 31, 2024: • The balance of uninsured deposits was $897.7 million, or 23.8% of total deposits, which included $195.9 million of collateralized deposits to municipalities. • The balance of brokered deposits was $387.1 million, or 10.2% of total deposits. • Commercial and consumer depositors represented 55% and 45% of total deposits, respectively. • The average balance of our deposit accounts was $35,000. • Our largest 25 depositors made up $480.8 million, or 12.7% of total deposits.
(Dollars in thousands) December 31, 2025 December 31, 2024 $ Change % Change Core deposits Noninterest-bearing deposits $ 707,748 $ 680,926 $ 26,822 4 % NOW accounts 546,387 575,238 (28,851) (5) Money market accounts 1,374,635 1,341,995 32,640 2 Savings accounts 171,455 181,317 (9,862) (5) Total core deposits 2,800,225 2,779,476 20,749 1 Certificates of deposit 909,772 999,727 (89,955) (9) Total $ 3,709,997 $ 3,779,203 $ (69,206) (2) % The following bullet points provide further information regarding the composition of our deposit portfolio as of December 31, 2025: • The balance of uninsured deposits was $971.5 million, or 26.2% of total deposits, which included $262.0 million of collateralized deposits to municipalities. • The balance of brokered deposits was $271.3 million, or 7.3% of total deposits. • Commercial and consumer depositors represented 56% and 44% of total deposits, respectively. • The average balance of our deposit accounts was $36,000. • Our largest 25 depositors made up $534.8 million, or 14.4% of total deposits.
Changes in the components of noninterest income are discussed below: Years Ended December 31, (Dollars in thousands) 2024 2023 $ Change % Change Noninterest income Service charges and fees on deposit accounts $ 9,165 $ 9,335 $ (170) (2) % Loan income and fees 2,737 2,336 401 17 Gain on sale of loans held for sale 6,253 5,250 1,003 19 BOLI income 4,312 4,996 (684) (14) Operating lease income 7,346 6,107 1,239 20 Gain (loss) on sale of premises and equipment (9) 734 (743) (101) Other 3,645 3,315 330 10 Total noninterest income $ 33,449 $ 32,073 $ 1,376 4 % • Loan income and fees: The increase was primarily driven by loan servicing income associated with SBA loans. • Gain on sale of loans held for sale: The increase was primarily driven by an increase in the premiums received on SBA loans sold during the current period.
Changes in the components of noninterest income are discussed below: Years Ended December 31, (Dollars in thousands) 2025 2024 $ Change % Change Noninterest income Service charges and fees on deposit accounts $ 9,807 $ 9,165 $ 642 7 % Loan income and fees 2,772 2,737 35 1 Gain on sale of loans held for sale 7,668 6,253 1,415 23 BOLI income 3,552 4,312 (760) (18) Operating lease income 7,064 7,346 (282) (4) Gain on sale of branches 1,448 — 1,448 100 Gain (loss) on sale of premises and equipment 93 (9) 102 1,133 Other 3,927 3,645 282 8 Total noninterest income $ 36,331 $ 33,449 $ 2,882 9 % • Gain on sale of loans held for sale: The increase was primarily driven by growth in the volume of HELOCs and residential mortgage loans sold during the current period, partially offset by a reduction in the sales volume of the guaranteed portion of SBA commercial loans.
These loans are typically secured by collateral and are used for general business purposes, including working capital financing, equipment financing, capital investment and general investments. Loan terms typically vary from one to five years. The interest rates on such loans are either fixed rate or adjustable rate indexed to The Wall Street Journal prime rate plus a margin.
These loans are primarily originated as conventional loans to business borrowers, which include lines of credit, term loans and letters of credit. These loans are typically secured by collateral and are used for general business purposes, including working capital financing, equipment financing, capital investment and general investments. Loan terms typically vary from one to five years.
(Dollars in thousands) December 31, 2024 December 31, 2023 Nonaccruing loans Commercial real estate loans Construction and land development $ — $ — Commercial real estate - owner occupied 8,471 912 Commercial real estate - non-owner occupied 3,551 4,032 Multifamily 47 74 Total commercial real estate loans 12,069 5,018 Commercial loans Commercial and industrial 3,487 2,774 Equipment finance 4,666 6,463 Municipal leases — — Total commercial loans 8,153 9,237 Residential real estate loans Construction and land development 132 132 One-to-four family 2,916 2,205 HELOCs 3,990 2,173 Total residential real estate loans 7,038 4,510 Consumer 407 568 Total nonaccruing loans $ 27,667 $ 19,333 Total repossessed assets 1,103 — Total nonperforming assets $ 28,770 $ 19,333 Total nonperforming assets as a percentage of total assets 0.63 % 0.41 % This increase was primarily driven by increases of $7.6 million in owner occupied commercial real estate and $1.8 million in home equity loans, partially offset by a $1.8 million decrease in equipment finance loans.
(Dollars in thousands) December 31, 2025 December 31, 2024 Nonaccruing loans Commercial real estate Construction and land development $ 381 $ — Commercial real estate - owner occupied 10,467 8,471 Commercial real estate - non-owner occupied 6,566 3,551 Multifamily — 47 Total commercial real estate 17,414 12,069 Commercial Commercial and industrial 9,786 3,487 Equipment finance 6,690 4,666 Municipal leases — — Total commercial 16,476 8,153 Residential real estate Construction and land development — 132 One-to-four family 2,961 2,916 HELOCs 6,523 3,990 Total residential real estate 9,484 7,038 Consumer 402 407 Total nonaccruing loans $ 43,776 $ 27,667 Total repossessed assets 657 1,103 Total nonperforming assets $ 44,433 $ 28,770 Total nonperforming assets as a percentage of total assets 0.98 % 0.63 % Total SBA loans included in nonaccrual loans $ 20,647 $ 6,619 Portion of SBA loans fully guaranteed by the SBA 14,885 3,462 Total nonaccruing loans, excluding the balance fully guaranteed by the SBA 28,891 24,205 Total repossessed assets 657 1,103 Total nonperforming assets, excluding the balance fully guaranteed by the SBA $ 29,548 $ 25,308 Total nonperforming assets, excluding the balance fully guaranteed by the SBA, as a percentage of total assets 0.65 % 0.55 % SBA loans made up the largest portion of nonperforming assets at $20.6 million and $6.6 million at December 31, 2025 and 2024, respectively.
Years Ended December 31, 2024 2023 (Dollars in thousands) Average Balance Outstanding Interest Earned/ Paid Yield/ Rate Average Balance Outstanding Interest Earned/ Paid Yield/ Rate Assets Interest-earning assets Loans receivable (1) $ 3,884,984 $ 247,642 6.37 % $ 3,732,796 $ 222,595 5.96 % Debt securities available for sale 137,108 6,045 4.41 151,110 5,037 3.33 Other interest-earning assets (2) 144,262 7,929 5.50 133,108 6,849 5.15 Total interest-earning assets 4,166,354 261,616 6.28 4,017,014 234,481 5.84 Other assets 273,307 268,102 Total assets $ 4,439,661 $ 4,285,116 Liabilities and equity Interest-bearing liabilities Interest-bearing checking accounts $ 570,952 $ 5,420 0.95 % $ 619,034 $ 4,450 0.72 % Money market accounts 1,314,867 40,680 3.09 1,217,474 27,534 2.26 Savings accounts 185,712 164 0.09 213,601 188 0.09 Certificate accounts 952,602 42,003 4.41 692,338 23,072 3.33 Total interest-bearing deposits 3,024,133 88,267 2.92 2,742,447 55,244 2.01 Junior subordinated debt 10,067 928 9.22 8,826 802 9.09 Borrowings 61,205 3,746 6.12 158,374 9,002 5.68 Total interest-bearing liabilities 3,095,405 92,941 3.00 2,909,647 65,048 2.24 Noninterest-bearing deposits 757,472 852,207 Other liabilities 58,496 52,155 Total liabilities 3,911,373 3,814,009 Stockholders' equity 528,288 471,107 Total liabilities and stockholders' equity $ 4,439,661 $ 4,285,116 Net earning assets $ 1,070,949 $ 1,107,367 Average interest-earning assets to average interest-bearing liabilities 134.60 % 138.06 % Non-tax-equivalent Net interest income $ 168,675 $ 169,433 Interest rate spread 3.28 % 3.60 % Net interest margin (3) 4.05 % 4.22 % Tax-equivalent (4) Net interest income $ 170,135 $ 170,677 Interest rate spread 3.31 % 3.63 % Net interest margin (3) 4.08 % 4.25 % (1) Average loans receivable balances include loans held for sale and nonaccruing loans.
Years Ended December 31, 2025 2024 (Dollars in thousands) Average Balance Outstanding Interest Earned / Paid Yield / Rate Average Balance Outstanding Interest Earned / Paid Yield / Rate Assets Interest-earning assets Loans receivable (1) $ 3,823,319 $ 240,399 6.29 % $ 3,884,984 $ 247,642 6.37 % Debt securities available for sale 148,951 6,706 4.50 137,108 6,045 4.41 Other interest-earning assets (2) 182,666 9,033 4.95 144,262 7,929 5.50 Total interest-earning assets 4,154,936 256,138 6.16 4,166,354 261,616 6.28 Other assets 260,395 273,307 Total assets $ 4,415,331 $ 4,439,661 Liabilities and equity Interest-bearing liabilities Interest-bearing checking accounts $ 555,443 $ 4,669 0.84 % $ 570,952 $ 5,420 0.95 % Money market accounts 1,342,019 36,648 2.73 1,314,867 39,851 3.03 Savings accounts 178,503 136 0.08 185,712 164 0.09 Certificate accounts 919,734 36,149 3.93 952,602 42,003 4.41 Total interest-bearing deposits 2,995,699 77,602 2.59 3,024,133 87,438 2.89 Junior subordinated debt 10,167 817 8.04 10,067 928 9.22 Borrowings 20,597 981 4.76 61,205 3,746 6.12 Total interest-bearing liabilities 3,026,463 79,400 2.62 3,095,405 92,112 2.98 Noninterest-bearing deposits 743,578 757,472 Other liabilities 63,109 58,496 Total liabilities 3,833,150 3,911,373 Stockholders' equity 582,181 528,288 Total liabilities and stockholders' equity $ 4,415,331 $ 4,439,661 Net earning assets $ 1,128,473 $ 1,070,949 Average interest-earning assets to average interest-bearing liabilities 137.29 % 134.60 % Non-tax-equivalent Net interest income $ 176,738 $ 169,504 Interest rate spread 3.54 % 3.30 % Net interest margin (3) 4.25 % 4.07 % Tax-equivalent (4) Net interest income $ 178,475 $ 170,964 Interest rate spread 3.58 % 3.34 % Net interest margin (3) 4.30 % 4.10 % (1) Average loans receivable balances include loans held for sale and nonaccruing loans.
Lastly, our hedging of mandatory commitments on the residential mortgage loan pipeline resulted in gains of $81,000 and $284,000 in the same periods, respectively. • BOLI income: The decrease was primarily the result of a $1.5 million decrease in tax-free gains on death benefit proceeds in excess of the cash surrender value of the policies compared to the prior year, partially offset by the impact of higher yielding policies due to the partial restructuring of the portfolio at the end of the prior year. • Operating lease income: The increase was the result of $2.1 million in additional contract earnings on a higher average outstanding balance of associated contracts, partially offset by an $805,000 increase in the valuation allowance against previously leased equipment. • Gain (loss) on sale of premises and equipment: During the prior year, three properties were sold for a combined net gain of $734,000.
Lastly, our hedging of mandatory commitments on the residential mortgage loan pipeline resulted in a net loss of $131,000 for the year ended December 31, 2025 versus a net gain of $81,000 in the prior year. • BOLI income: The decrease was due to a $1.0 million decrease in tax-free gains on death benefit proceeds in excess of the cash surrender value of the policies year-over-year, partially offset by higher yielding policies as a result of restructuring the portfolio at the end of calendar year 2023. • Gain on sale of branches: During the current year we completed the sale of our two Knoxville, Tennessee branches, recognizing a gain of $1.4 million in the current year, with no similar activity occurring in the prior year.
As of this same date, we retained a $2.2 million qualitative allocation in our ACL for the potential impact of the storm upon our loan portfolio which had been established in the quarter ended September 30, 2024. Our individually evaluated loans are comprised of loans meeting certain thresholds including those on nonaccrual status.
As any residual impact of the Hurricane was believed to have now been reflected elsewhere within the ACL, in 2025 we released the $2.2 million qualitative allocation previously established. Our individually evaluated loans are comprised of loans meeting certain thresholds including those on nonaccrual status.
Activity within stockholders' equity included $54.8 million in net income and $5.9 million in stock-based compensation and stock option exercises, partially offset by $7.7 million in cash dividends declared. As of December 31, 2024, the Bank was considered "well capitalized" in accordance with its regulatory capital guidelines and exceeded all regulatory capital requirements.
Activity within stockholders' equity included $64.4 million in net income and $5.6 million in share-based compensation and stock option exercises, partially offset by $8.4 million in cash dividends declared and $13.6 million in stock repurchases.
Changes in the components of noninterest expense are discussed below: Years Ended December 31, (Dollars in thousands) 2024 2023 $ Change % Change Noninterest expense Salaries and employee benefits $ 67,900 $ 65,692 $ 2,208 3 % Occupancy expense, net 9,768 9,999 (231) (2) Computer services 12,506 12,388 118 1 Operating lease depreciation expense 7,734 5,406 2,328 43 Telephone, postage and supplies 2,253 2,545 (292) (11) Marketing and advertising 1,893 2,180 (287) (13) Deposit insurance premiums 2,230 2,580 (350) (14) Core deposit intangible amortization 2,463 3,184 (721) (23) Merger-related expenses — 4,741 (4,741) (100) Contract renewal consulting fee 2,965 — 2,965 100 Other 14,956 14,374 582 4 Total noninterest expense $ 124,668 $ 123,089 $ 1,579 1 % • Salaries and employee benefits: The increase was primarily the result of pay increases, partially offset by reductions in incentive pay. • Operating lease depreciation expense: The increase was due to a higher average outstanding balance of associated contracts. • Core deposit intangible amortization: The intangible recorded as a result of the Quantum merger is being amortized on an accelerated basis, so the rate of amortization slowed year-over-year. • Merger-related expenses: The prior year included expenses associated with the Quantum merger.
Changes in the components of noninterest expense are discussed below: Years Ended December 31, (Dollars in thousands) 2025 2024 $ Change % Change Noninterest expense Salaries and employee benefits $ 72,956 $ 67,900 $ 5,056 7 % Occupancy expense, net 10,021 9,768 253 3 Computer services 10,653 12,506 (1,853) (15) Operating lease depreciation expense 7,009 7,734 (725) (9) Telecom, postage and supplies 2,188 2,253 (65) (3) Marketing and advertising 1,879 1,893 (14) (1) Deposit insurance premiums 1,935 2,230 (295) (13) Core deposit intangible amortization 1,747 2,463 (716) (29) Contract renewal consulting fee — 2,965 (2,965) (100) Other 16,788 15,785 1,003 6 Total noninterest expense $ 125,176 $ 125,497 $ (321) — % • Salaries and employee benefits: The increase was primarily the result of increases in both pay and incentive compensation. • Computer services: At the end of 2024, we finalized a multiyear renewal of our largest core processing contract.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed2 unchanged
Biggest changeThe information contained in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Asset Liability Management and Interest Rate Risk” in this Form 10-K is incorporated herein by reference.
Biggest changeThe information contained above in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Asset Liability Management and Interest Rate Risk” in this Form 10-K is incorporated herein by reference.

Other HTB 10-K year-over-year comparisons