Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at Old National Bank (NASDAQ:ONB) and its peers.
Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.
The 98 regional banks stocks we track reported a satisfactory Q2. As a group, revenues were in line with analysts’ consensus estimates.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Old National Bank (NASDAQ:ONB)
Tracing its roots back to 1834 when Andrew Jackson was president, Old National Bancorp (NASDAQ:ONB) is a bank holding company that provides commercial and consumer loans, deposit services, wealth management, and treasury solutions primarily throughout the Midwest region.
Old National Bank reported revenues of $647.3 million, up 36.1% year on year. This print exceeded analysts’ expectations by 4.5%. Overall, it was a strong quarter for the company with a solid beat of analysts’ tangible book value per share estimates.
“I’m truly thrilled to join a team that’s so deeply committed to relationship banking and making a real impact on our communities,” said Burke. “Old National’s core values and mission strongly align with my personal values, positioning me well to jump into the role, take care of clients and deliver standout products and services consistently across all of our markets.”
Unsurprisingly, the stock is down 4.9% since reporting and currently trades at $21.55.
Best Q2: UMB Financial (NASDAQ:UMBF)
With roots dating back to 1913 and a name derived from "United Missouri Bank," UMB Financial (NASDAQ:UMBF) is a financial holding company that provides banking, asset management, and fund services to commercial, institutional, and individual customers.
UMB Financial reported revenues of $689.2 million, up 76.7% year on year, outperforming analysts’ expectations by 8.6%. The business had a stunning quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ tangible book value per share estimates.
The market seems happy with the results as the stock is up 5.7% since reporting. It currently trades at $116.
Is now the time to buy UMB Financial? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Coastal Financial (NASDAQ:CCB)
Pioneering the intersection of traditional banking and financial technology in the Pacific Northwest, Coastal Financial (NASDAQ:CCB) operates as a bank holding company that provides traditional banking services and Banking-as-a-Service (BaaS) solutions to consumers and businesses.
Coastal Financial reported revenues of $119.4 million, down 11.7% year on year, falling short of analysts’ expectations by 21.5%. It was a disappointing quarter as it posted a significant miss of analysts’ net interest income estimates and a significant miss of analysts’ EPS estimates.
Interestingly, the stock is up 4.2% since the results and currently trades at $105.71.
Read our full analysis of Coastal Financial’s results here.
Live Oak Bancshares (NYSE:LOB)
Founded during the 2008 financial crisis with a vision to reimagine small business banking through technology, Live Oak Bancshares (NYSE:LOB) is a bank holding company that specializes in providing online banking services and SBA-guaranteed loans to small businesses across targeted industries nationwide.
Live Oak Bancshares reported revenues of $143.7 million, up 14.6% year on year. This number beat analysts’ expectations by 2.7%. It was a strong quarter as it also logged a solid beat of analysts’ net interest income estimates and a narrow beat of analysts’ tangible book value per share estimates.
The stock is up 9% since reporting and currently trades at $35.35.
Read our full, actionable report on Live Oak Bancshares here, it’s free.
Ameris Bancorp (NYSE:ABCB)
Tracing its roots back to 1971 and expanding significantly through both organic growth and strategic acquisitions, Ameris Bancorp (NYSE:ABCB) is a financial holding company that provides a full range of banking services to retail and commercial customers across select markets in the southeastern United States.
Ameris Bancorp reported revenues of $300.7 million, flat year on year. This print topped analysts’ expectations by 1.4%. Overall, it was a very strong quarter as it also recorded a beat of analysts’ EPS estimates and a solid beat of analysts’ net interest income estimates.
The stock is up 5.5% since reporting and currently trades at $70.02.
Read our full, actionable report on Ameris Bancorp here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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