QCR Holdings, Inc., the parent company of Cedar Rapids Bank & Trust (CRBT), announced net income of $25.8 million, and diluted earnings per share (EPS) of $1.52, for the first quarter of 2025.
In a Tuesday, April 22, earnings release, QCR said the results compared to net income of $30.2 million and diluted EPS of $1.77 for the fourth quarter of 2024.
In addition to QCBT, headquartered in Bettendorf, the Moline-based multi-bank holding company also serves the Iowa markets of Cedar Rapids, Cedar Valley, Des Moines/Ankeny and Springfield, Missouri through its wholly owned subsidiary banks.
For the full earnings release, visit here.
Here’s a look at some of the other highlights for the first quarter that ended March 31:
Net interest income for the first quarter totaled $60 million, a decrease of $1.2 million from the fourth quarter 2024.
“Our adjusted net interest margin (NIM), on a tax equivalent yield (TEY) basis, increased one basis point from the fourth quarter of 2024 and was within our guidance range, overpowering the dilution from the impact of expired interest rate caps,” Todd A. Gipple, QCR president and chief financial officer, said in the release.
“Looking ahead, we anticipate continued margin expansion and are guiding to second quarter adjusted NIM TEY in the range from static to an increase of four basis points, assuming no Federal Reserve rate cuts,” he added.
Noninterest income
Noninterest income totaled $16.9 million, down from $30.6 million in the fourth quarter of 2024. QCR generated $6.5 million of capital markets revenue during the first quarter, compared to $20.6 million in the prior quarter.
“Our capital markets business was affected by macroeconomic uncertainty. Despite this, demand for affordable housing remains significant,” Larry Helling, QCR’s chief executive officer, said in the release. “The lower first quarter results in this sector should lead to a larger pipeline for future transactions. Our capital markets activity for the second quarter is normalizing as clients adjust to the current environment.”
QCR also reported strength in its wealth management business in the first quarter, generating annualized revenue growth of 14%.
“We expect continued strong growth in this business to be fueled by the strategic investments we made in our Southwest Missouri and Central Iowa markets,” Mr. Gipple said.
Deposit growth
During the first quarter, core deposits increased by $332.2 million, or 20% annualized, allowing QCR to decrease brokered deposits by $56.0 million, and overnight FHLB advances by $140 million. Gross loans and leases held for investment as a percentage of total deposits ratio improved to 92.96% from 96.05% from the prior quarter.
“Our deposit growth this quarter reflects our strong execution in expanding market share and deepening relationships with both new and existing clients in our core markets,” said Mr. Helling, who will retire in May as CEO of both QCR and Cedar Rapids Bank and Trust Company, one of its subsidiaries. Mr. Gipple will succeed him after the company’s annual meeting Thursday, May 22.
Continued loan growth
In the first quarter, total loans and leases held for investment grew by $38.9 million to $6.8 billion.
“First quarter loan activity was influenced by heightened macroeconomic uncertainty and elevated payoffs,” Mr. Helling added. “We anticipate that the slowdown in our LIHTC business during this period should lead to a larger pipeline of future activity driven by the ongoing significant demand for low-income housing.”
In addition, QCR said its asset quality remains strong. Its nonperforming assets (NPAs) to total assets ratio was 0.53% on March 31, up three basis points from the prior quarter. NPAs totaled $48.1 million at the end of the first quarter, which was a $2.6 million increase from the prior quarter. The increase in NPAs was primarily due to the addition of three specific loans, partially offset by the payoff of its largest NPA in January.
Its total criticized loans, a leading indicator of asset quality, declined by $18.2 million on a linked-quarter basis, and the ratio of criticized loans to total loans and leases as of March 31, improved to 2.06%, as compared to 2.34% on Dec. 31. This $18.2 million reduction marks QCR’s lowest criticized loan ratio in five years.
