Glacier Bancorp, Inc. Q3 FY2025 earnings call

• The company delivered an excellent quarter with strong margin expansion, loan growth, and deposit growth.
• Completed core conversion of Bank of Idaho ($1.4 billion assets) and acquired Guaranty Bank ($3.1 billion assets), entering the Texas market. Bank of Idaho was folded into existing divisions, and Guaranty brings long-term opportunities in Texas.
• Pretax pre-provision net revenues for the first nine months of the current year increased $77.1 million (45%) over the prior year's first nine months.
• Focus on a flawless conversion in 2026 and ensuring happy employees and customers.

Glacier Bancorp, Inc. reported net income of $67.9 million or $0.57 per diluted share for the third quarter. The loan portfolio grew $258 million to $18.8 billion, a 6% annualized increase from the prior quarter, with commercial real estate as a key driver. Deposits reached $22 billion, up 4% annualized, with non-interest-bearing deposits making up 31% of total deposits. Net interest income was $225 million, up $18 million (9%) from the prior quarter and $45 million (25%) from the same quarter last year. The net interest margin on a tax-adjusted basis expanded to 3.39%, up 18 basis points from the prior quarter and 56 basis points year over year. The loan yield was 5.97%, up 11 basis points from the prior quarter and 28 basis points from the prior year third quarter. Total cost of funding declined to 1.58%, down 5 basis points from the prior quarter. Non-interest expense was $168 million, up $13 million (8%) from the second quarter. Non-interest income totaled $35 million, up $2.4 million (7%) from the prior quarter. Credit quality remained strong with nonperforming assets at 0.19% of total assets and net charge-offs at three basis points of loans. Tangible stockholders' equity increased $34 million (14%), and tangible book value per share was $20.46, up 8% year over year.

• For the fourth quarter, the company anticipates margin growth of 18 to 20 basis points, including the impact of Guaranty.
• In 2026, margin growth is expected but the pace of quarterly increase is likely to moderate.
• The fourth quarter non-interest expense is expected to range from $185 million to $189 million, including a step-up due to the Guaranty acquisition, with $21 to $22 million added to core non-interest expense and $3 million of amortization expense for a core deposit intangible.

Q: On margin outlook given September rate cut, A: Byron J. Pollan expects continued margin growth, with Q4 margin up 18-20 basis points including Guaranty, and 2026 margin growth expected but pace to moderate.

Q: On Texas market reception and M&A strategy, A: Randall M. Chesler says Guaranty is well-fitted, focus on conversion in 1Q 2026, then will explore M&A opportunities across areas.

Q: On deposit cost and beta, A: Byron J. Pollan says deposit cost on Sept 30 was 1.22%, beta mid-teens, with Guaranty's deposit base having slightly higher beta.

Q: On expense run rate and Guaranty impact, A: Ronald J. Copher says Q4 non-interest expense expected $185-189 million, including $21-22 million from Guaranty core non-interest expense and $3 million amortization.

Q: On margin guidance and color, A: Byron J. Pollan says margin guidance is more modest due to softer repricing list, rate cuts, and deposit lag.

Q: On non-depository financial institution lending and credit checks, A: Tom P. Dolan says exposure is immaterial, focus on community banking, knowing customers, regular reviews.