Old National Thrives in Challenging 2024 with Strong Growth, Solid Earnings
Old National reported a strong fourth quarter and full year performance this morning, exceeding expectations despite navigating an uncertain environment. Chairman Jim Ryan attributed the bank's success to its focus on low-cost core deposits, which grew by approximately 10% in 2024, funding a corresponding 10% growth in loans.
The company's basic banking strategy has served it well, with total deposits and loans experiencing a compounded annual growth rate of 8% since 2022. This growth was driven by the bank's focus on low-cost core deposits, which finished the year at 1.93%, with an impressive 93% drop in beta on exception price deposits.
Ryan highlighted Old National's peer-leading deposit franchise, disciplined loan growth, strong credit quality, well-managed expenses, and dedicated team members as key factors in its success. The bank's full-year results were impressive, with GAAP per common share at $1.68 and adjusted earnings per common share of $1.86.
Adjusted return on average tangible common equity was a respectable 16.9%, while net return on average assets stood at 1.14%. Notably, the adjusted efficiency ratio came in at 52%, and net charge-offs were low at 17 basis points.
The company also announced its partnership with Bremer Bank, enhancing its presence in the Mid-west and expanding its footprint across Minnesota, North Carolina, and Wisconsin. Ryan expressed enthusiasm for the collaboration and highlighted the genuine interest of Bremer team members in the combination.
Looking ahead, Old National is confident in its ability to navigate changes in short-term interest rates, shifts in the yield curve, and overall economic conditions. Chairman Jim Ryan emphasized his confidence in the bank's leadership and expressed gratitude for President and COO Mark Sander's dedicated service, which will come to an end on June 30.
Old National's financial performance has been nothing short of impressive, with its total shareholder return significantly outperforming the KRX and executive peer group in 2024. The bank's tangible book value per share grew by 8% year-over-year, solidifying its position as one of the premier banks in the country.
