8-K
COMMUNITY TRUST BANCORP INC /KY/ (CTBI)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
December 31, 2024
Commission file number 001-31220
Community Trust Bancorp, Inc.
(Exact name of registrant as specified in its charter)
| Kentucky | 61-0979818 |
|---|---|
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
| P.O. Box 2947<br><br> <br>346 North Mayo Trail<br><br> <br>Pikeville,<br> Kentucky | 41502 |
| (Address of principal executive offices) | (Zip code) |
| (606)<br> 432-1414<br><br> <br>(Registrant’s telephone number) | |
| Securities registered pursuant to Section 12(b) of the Act: | |
| Common Stock<br><br> <br>(Title of class) | |
| CTBI | The NASDAQ Global Select Market |
| --- | --- |
| (Trading symbol) | (Name of exchange on which registered) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Securities Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 – Results of Operations and Financial Condition
On January 15, 2025, Community Trust Bancorp, Inc. issued a press release announcing its financial results for the quarter and year ended December 31, 2024. A copy of this press release is being furnished to the Securities and Exchange Commission pursuant to Item 2.02 – Results of Operations and Financial Condition and Item 7.01 – Regulation FD Disclosure of Form 8-K and is attached hereto as Exhibit 99.1. The information in this Form 8-K and in Exhibit 99.1 attached hereto shall not be deemed filed for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference.
Item 9.01 – Financial Statements and Exhibits
(d) Exhibits
The following exhibit is filed with this report:
| 99.1 | Press Release dated January 15, 2025 |
|---|
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| COMMUNITY TRUST BANCORP, INC. | ||
|---|---|---|
| Date: | January 15, 2025 | By: |
| /s/ Mark A. Gooch | ||
| Mark A. Gooch | ||
| Chairman, President, and Chief Executive Officer |
Page 2
Page 3
Exhibit 99.1
FOR IMMEDIATE RELEASE
January 15, 2025
FOR ADDITIONAL INFORMATION, PLEASE CONTACT MARK A. GOOCH, CHAIRMAN, PRESIDENT, AND CEO, COMMUNITY TRUST BANCORP, INC. AT (606) 437-3229
Pikeville, Kentucky:
COMMUNITY TRUST BANCORP, INC. REPORTS EARNINGS FOR THE 4^TH^ QUARTER AND YEAR 2024
Earnings Summary
| Earnings Summary | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (in thousands except per share data) | 4Q<br><br> <br>2024 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | Year<br><br> <br>2024 | Year<br><br> <br>2023 | ||||||||||
| Net income | $ | 22,493 | $ | 22,142 | $ | 18,659 | $ | 82,813 | $ | 78,004 | |||||
| Earnings per share | $ | 1.25 | $ | 1.23 | $ | 1.04 | $ | 4.61 | $ | 4.36 | |||||
| Earnings per share - diluted | $ | 1.25 | $ | 1.23 | $ | 1.04 | $ | 4.61 | $ | 4.36 | |||||
| Return on average assets | 1.47 | % | 1.50 | % | 1.30 | % | 1.41 | % | 1.40 | % | |||||
| Return on average equity | 11.77 | % | 11.77 | % | 10.98 | % | 11.31 | % | 11.75 | % | |||||
| Efficiency ratio | 51.60 | % | 51.75 | % | 55.74 | % | 52.57 | % | 54.29 | % | |||||
| Tangible common equity | 11.30 | % | 11.79 | % | 11.16 | % | |||||||||
| Dividends declared per share | $ | 0.47 | $ | 0.47 | $ | 0.46 | $ | 1.86 | $ | 1.80 | |||||
| Book value per share | $ | 41.95 | $ | 42.14 | $ | 39.01 | |||||||||
| Weighted average shares | 17,971 | 17,962 | 17,901 | 17,950 | 17,887 | ||||||||||
| Weighted average shares - diluted | 18,009 | 17,991 | 17,926 | 17,977 | 17,900 |
Community Trust Bancorp, Inc. (NASDAQ-CTBI) achieved earnings for the fourth quarter 2024 of $22.5 million, or $1.25 per basic share, compared to $22.1 million, or $1.23 per basic share, earned during the third quarter 2024 and $18.7 million, or $1.04 per basic share, earned during the fourth quarter 2023. Total revenue for the quarter was $2.9 million above prior quarter and $9.0 million above prior year same quarter. Net interest revenue for the quarter increased $2.3 million compared to prior quarter and $6.6 million compared to prior year same quarter, and noninterest income increased $0.6 million compared to prior quarter and $2.4 million compared to prior year same quarter. Our provision for credit losses for the quarter decreased $0.1 million from prior quarter but increased $0.8 million from prior year same quarter. Noninterest expense increased $1.3 million compared to prior quarter and $2.1 million compared to prior year same quarter. Net income for the year ended December 31, 2024 was $82.8 million, or $4.61 per basic share, compared to $78.0 million, or $4.36 per basic share, for the year ended December 31, 2023.
4^th^ Quarter 2024 Highlights
| ❖ | Net interest income for the quarter of $49.5 million was $2.3 million, or 4.9%, above prior quarter and $6.6 million, or 15.2%,<br> above prior year same quarter, as our net interest margin increased 4 basis points from prior quarter and 24 basis points from prior year same quarter. |
|---|---|
| ❖ | Provision for credit losses at $2.6 million for the quarter decreased $0.1 million from prior quarter but increased $0.8 million<br> from prior year same quarter. |
| --- | --- |
| ❖ | Noninterest income for the quarter ended December 31, 2024 of $16.2 million was $0.6 million, or 3.8%, above prior quarter and<br> $2.4 million, or 17.7%, above prior year same quarter. |
| --- | --- |
| ❖ | Noninterest expense for the quarter<br> ended December 31, 2024 of $33.8 million was $1.3 million, or 3.9%, above prior quarter and $2.1 million, or 6.8%, above prior year same quarter. |
| --- | --- |
| ❖ | Our loan portfolio at $4.5 billion increased $136.2 million, an annualized 12.5%, from September 30, 2024 and $435.7 million, or<br> 10.8%, from December 31, 2023. |
| --- | --- |
| ❖ | We had net loan charge-offs of $1.0 million, or an annualized 0.09% of average loans, for the fourth quarter 2024 compared to $1.5<br> million, or an annualized 0.14% of average loans, for the third quarter 2024 and $1.0 million, or 0.10% of average loans annualized, for the fourth quarter 2023. |
| --- | --- |
| ❖ | Our total nonperforming loans increased to $26.7 million at December 31, 2024 from $25.1 million at September 30, 2024 and $14.0<br> million at December 31, 2023. Nonperforming assets at $30.3 million increased $3.9 million from September 30, 2024 and $14.7 million from December 31, 2023. |
| --- | --- |
| ❖ | Deposits, including repurchase agreements, at $5.3 billion increased $238.8 million, or an annualized 18.7%, from September 30,<br> 2024 and $360.5 million, or 7.3%, from December 31, 2023. |
| --- | --- |
| ❖ | Shareholders’ equity at $757.6 million decreased $3.2 million, or an annualized 1.7%, during the quarter but increased $55.4<br> million, or 7.9%, from December 31, 2023. Shareholders’ equity was negatively impacted during the quarter by the increase in unrealized losses on securities driven by higher long-term interest rates. |
| --- | --- |
Net Interest Income
| Percent Change | ||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 4Q 2024<br><br> <br>Compared to: | ||||||||||||||||||||||||
| ($ in thousands) | 4Q<br><br> <br>2024 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | Year<br><br> <br>2024 | Year<br><br> <br>2023 | Percent Change | ||||||||||||||||
| Components of net interest income: | ||||||||||||||||||||||||
| Income on earning assets | $ | 81,979 | $ | 79,814 | $ | 73,329 | 2.7 | % | 11.8 | % | 313,443 | $ | 268,650 | 16.7 | % | |||||||||
| Expense on interest bearing liabilities | 32,452 | 32,615 | 30,354 | (0.5 | %) | 6.9 | % | 127,448 | 95,540 | 33.4 | % | |||||||||||||
| Net interest income | 49,527 | 47,199 | 42,975 | 4.9 | % | 15.2 | % | 185,995 | 173,110 | 7.4 | % | |||||||||||||
| TEQ | 273 | 280 | 297 | (2.6 | %) | (8.0 | %) | 1,139 | 1,191 | (4.3 | %) | |||||||||||||
| Net interest income, tax equivalent | $ | 49,800 | $ | 47,479 | $ | 43,272 | 4.9 | % | 15.1 | % | 187,134 | $ | 174,301 | 7.4 | % | |||||||||
| Average yield and rates paid: | ||||||||||||||||||||||||
| Earning assets yield | 5.66 | % | 5.72 | % | 5.43 | % | (1.0 | %) | 4.2 | % | 5.65 | % | 5.15 | % | 9.8 | % | ||||||||
| Rate paid on interest bearing liabilities | 3.18 | % | 3.36 | % | 3.27 | % | (5.4 | %) | (2.6 | %) | 3.30 | % | 2.72 | % | 21.2 | % | ||||||||
| Gross interest margin | 2.48 | % | 2.36 | % | 2.16 | % | 5.2 | % | 15.1 | % | 2.35 | % | 2.43 | % | (3.1 | %) | ||||||||
| Net interest margin | 3.43 | % | 3.39 | % | 3.19 | % | 1.1 | % | 7.5 | % | 3.36 | % | 3.32 | % | 1.1 | % | ||||||||
| Average balances: | ||||||||||||||||||||||||
| Investment securities | $ | 1,075,698 | $ | 1,091,258 | $ | 1,144,078 | (1.4 | %) | (6.0 | %) | 1,102,434 | $ | 1,200,965 | (8.2 | %) | |||||||||
| Loans | $ | 4,399,291 | $ | 4,300,652 | 4,022,547 | 2.3 | % | 9.4 | % | 4,247,762 | 3,888,585 | 9.2 | % | |||||||||||
| Earning assets | $ | 5,779,438 | $ | 5,570,160 | 5,377,827 | 3.8 | % | 7.5 | % | 5,569,948 | 5,244,128 | 6.2 | % | |||||||||||
| Interest-bearing liabilities | $ | 4,059,061 | $ | 3,859,978 | 3,687,660 | 5.2 | % | 10.1 | % | 3,867,733 | 3,514,142 | 10.1 | % |
Net interest income for the quarter of $49.5 million was $2.3 million, or 4.9%, above prior quarter and $6.6 million, or 15.2%, above prior year same quarter. Our net interest margin, on a fully tax equivalent basis, at 3.43% increased 4 basis points from prior quarter and 24 basis points from prior year same quarter. Our quarterly average earning assets increased $209.3 million from prior quarter and $401.6 million from prior year same quarter. Our yield on average earning assets decreased 6 basis points from prior quarter but increased 23 basis points from prior year same quarter, while our cost of funds decreased 18 basis points from prior quarter and 9 basis points from prior year same quarter. Net interest income for the year ended December 31, 2024 was $186.0 million compared to $173.1 million for the year ended December 31, 2023.
Our ratio of average loans to deposits, including repurchase agreements, was 84.4% for the quarter ended December 31, 2024 compared to 85.8% for the quarter ended September 30, 2024 and 81.8% for the quarter ended December 31, 2023.
Noninterest Income
| Percent Change | |||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 4Q 2024<br><br> <br>Compared to: | |||||||||||||||||||
| ($ in thousands) | 4Q<br><br> <br>2024 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | Year<br><br> <br>2024 | Year<br><br> <br>2023 | Percent Change | |||||||||||
| Deposit related fees | $ | 7,619 | $ | 7,886 | $ | 7,312 | (3.4 | %) | 4.2 | % | 29,824 | $ | 29,935 | (0.4 | %) | ||||
| Trust revenue | 3,961 | 3,707 | 3,318 | 6.9 | 19.4 | % | 14,921 | 13,025 | 14.6 | % | |||||||||
| Gains on sales of loans | 50 | 80 | 54 | (37.6 | ) | (8.0 | %) | 294 | 395 | (25.6 | %) | ||||||||
| Loan related fees | 1,472 | 813 | 467 | 81.2 | % | 215.5 | % | 4,957 | 3,792 | 30.7 | % | ||||||||
| Bank owned life insurance revenue | 915 | 1,214 | 816 | (24.6 | %) | 12.1 | % | 5,236 | 3,517 | 48.9 | % | ||||||||
| Brokerage revenue | 536 | 563 | 285 | (4.8 | %) | 88.2 | % | 2,272 | 1,473 | 54.3 | % | ||||||||
| Other | 1,607 | 1,300 | 1,473 | 23.6 | % | 9.1 | % | 5,061 | 5,522 | (8.3 | %) | ||||||||
| Total noninterest income | $ | 16,160 | $ | 15,563 | $ | 13,725 | 3.8 | % | 17.7 | % | 62,565 | $ | 57,659 | 8.5 | % |
Noninterest income for the quarter ended December 31, 2024 of $16.2 million was $0.6 million, or 3.8%, above prior quarter and $2.4 million, or 17.7%, above prior year same quarter. Quarter over quarter increases in loan related fees ($0.7 million), trust revenue ($0.3 million), and securities gains ($0.3 million) were offset by decreases in deposit related fees ($0.3 million) and bank owned life insurance revenue ($0.3 million). Year over year increases included loan related fees ($1.0 million), trust fees ($0.6 million), deposit related fees ($0.3 million), securities gains ($0.3 million), and brokerage revenue ($0.2 million). The increase in loan related fees for the quarter resulted primarily from the fluctuation in the fair market value of our mortgage servicing rights. The increase in securities gains for the quarter was primarily the result of the valuation of our Visa Class B stock. Noninterest income for the year 2024 was $62.6 million compared to $57.7 million for the year 2023.
Noninterest Expense
| Percent Change | |||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 4Q 2024<br><br> <br>Compared to: | |||||||||||||||||||
| ($ in thousands) | 4Q<br><br> <br>2024 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | Year<br><br> <br>2024 | Year<br><br> <br>2023 | Percent Change | |||||||||||
| Salaries | $ | 13,310 | $ | 13,374 | $ | 13,163 | (0.5 | %) | 1.1 | % | $ | 52,757 | $ | 51,283 | 2.9 | % | |||
| Employee benefits | 6,883 | 6,147 | 5,282 | 12.0 | % | 30.3 | % | 26,670 | 22,428 | 18.9 | % | ||||||||
| Net occupancy and equipment | 3,015 | 3,072 | 3,045 | (1.9 | %) | (1.0 | %) | 12,204 | 11,843 | 3.1 | % | ||||||||
| Data processing | 3,181 | 2,804 | 2,630 | 13.4 | % | 20.9 | % | 11,172 | 9,726 | 14.9 | % | ||||||||
| Legal and professional fees | 1,039 | 1,024 | 900 | 1.4 | % | 15.4 | % | 3,873 | 3,350 | 15.6 | % | ||||||||
| Advertising and marketing | 821 | 876 | 923 | (6.3 | %) | (11.0 | %) | 3,130 | 3,214 | (2.6 | %) | ||||||||
| Taxes other than property and payroll | 436 | 438 | 421 | (0.5 | %) | 3.5 | % | 1,754 | 1,706 | 2.8 | % | ||||||||
| Other | 5,084 | 4,777 | 5,264 | 6.4 | % | (3.4 | %) | 19,363 | 21,840 | (11.3 | %) | ||||||||
| Total noninterest expense | $ | 33,769 | $ | 32,512 | $ | 31,628 | 3.9 | % | 6.8 | % | $ | 130,923 | $ | 125,390 | 4.4 | % |
Noninterest expense for the quarter ended December 31, 2024 of $33.8 million was $1.3 million, or 3.9%, above prior quarter and $2.1 million, or 6.8%, above prior year same quarter. The quarter over quarter increase primarily resulted from increases in personnel expense ($0.7 million) and data processing expense ($0.4 million). The year over year increase was primarily due to increases in personnel expense ($1.7 million, which included a $1.1 million increase in bonuses and incentives and a $0.5 million increase in the cost of group medical and life insurance benefits) and data processing ($0.6 million). Other noninterest expense was positively impacted year over year by the accounting method change related to investments in tax credit structures (ASU No. 2023-02). Noninterest expense for the year 2024 was $130.9 million compared to $125.4 million for the year 2023.
Balance Sheet Review
Total Loans
| Percent Change | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 4Q 2024 Compared to: | ||||||||||||
| ($ in thousands) | 4Q<br><br> <br>2024 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | |||||||
| Commercial nonresidential real estate | $ | 865,031 | $ | 834,985 | $ | 778,637 | 3.6 | % | 11.1 | % | ||
| Commercial residential real estate | 508,310 | 485,004 | 417,943 | 4.8 | % | 21.6 | % | |||||
| Hotel/motel | 458,832 | 453,465 | 395,765 | 1.2 | % | 15.9 | % | |||||
| Other commercial | 440,506 | 440,636 | 391,390 | (0.0 | %) | 12.5 | % | |||||
| Total commercial | 2,272,679 | 2,214,090 | 1,983,735 | 2.6 | % | 14.6 | % | |||||
| Residential mortgage | 1,043,401 | 1,003,123 | 937,524 | 4.0 | % | 11.3 | % | |||||
| Home equity loans/lines | 167,425 | 163,013 | 147,036 | 2.7 | % | 13.9 | % | |||||
| Total residential | 1,210,826 | 1,166,136 | 1,084,560 | 3.8 | % | 11.6 | % | |||||
| Consumer indirect | 850,289 | 816,187 | 823,505 | 4.2 | % | 3.3 | % | |||||
| Consumer direct | 152,843 | 154,061 | 159,106 | (0.8 | %) | (3.9 | %) | |||||
| Total consumer | 1,003,132 | 970,248 | 982,611 | 3.4 | % | 2.1 | % | |||||
| Total loans | $ | 4,486,637 | $ | 4,350,474 | $ | 4,050,906 | 3.1 | % | 10.8 | % |
Total Deposits and Repurchase Agreements
| Percent Change | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 4Q 2024 Compared to: | ||||||||||||
| ($ in thousands) | 4Q<br><br> <br>2024 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | 3Q<br><br> <br>2024 | 4Q<br><br> <br>2023 | |||||||
| Noninterest bearing deposits | $ | 1,242,676 | $ | 1,204,515 | $ | 1,260,690 | 3.2 | % | (1.4 | %) | ||
| Interest bearing deposits | ||||||||||||
| Interest checking | 167,736 | 156,249 | 123,927 | 7.4 | % | 35.4 | % | |||||
| Money market savings | 1,781,415 | 1,658,758 | 1,525,537 | 7.4 | % | 16.8 | % | |||||
| Savings accounts | 511,378 | 501,933 | 535,063 | 1.9 | % | (4.4 | %) | |||||
| Time deposits | 1,366,984 | 1,316,807 | 1,279,405 | 3.8 | % | 6.8 | % | |||||
| Repurchase agreements | 240,166 | 233,324 | 225,245 | 2.9 | % | 6.6 | % | |||||
| Total interest bearing deposits and repurchase agreements | 4,067,679 | 3,867,071 | 3,689,177 | 5.2 | % | 10.3 | % | |||||
| Total deposits and repurchase agreements | $ | 5,310,355 | $ | 5,071,586 | $ | 4,949,867 | 4.7 | % | 7.3 | % |
CTBI’s total assets at $6.2 billion as of December 31, 2024 increased $230.3 million, or 15.4% annualized, from September 30, 2024 and $423.5 million, or 7.3%, from December 31, 2023. Loans outstanding at $4.5 billion increased $136.2 million, an annualized 12.5%, from September 30, 2024 and $435.7 million, or 10.8%, from December 31, 2023. The increase in loans from prior quarter included a $58.6 million increase in the commercial loan portfolio, a $44.7 million increase in the residential loan portfolio, and a $34.1 million increase in the indirect consumer loan portfolio, partially offset by a $1.2 million decrease in the consumer direct loan portfolio. CTBI’s investment portfolio decreased $41.8 million, or an annualized 15.1%, from September 30, 2024 and $107.4 million, or 9.2%, from December 31, 2023. The decrease in our investment portfolio quarter over quarter was primarily attributable to an increase in our unrealized losses in the amount of $23.7 million, while our unrealized losses decreased year over year by $6.6 million. Deposits in other banks increased $141.5 million from prior quarter and $83.9 million from December 31, 2023. Deposits, including repurchase agreements, at $5.3 billion increased $238.8 million, or an annualized 18.7%, from September 30, 2024 and $360.5 million, or 7.3%, from December 31, 2023. CTBI is not dependent on any one customer or group of customers for their source of deposits. As of December 31, 2024, no one customer accounted for more than 4% of our $5.1 billion in deposits. Only three customer relationships accounted for more than 1% each.
Shareholders’ equity at $757.6 million decreased $3.2 million, or an annualized 1.7%, during the quarter but increased $55.4 million, or 7.9%, from December 31, 2023. Net unrealized losses on securities, net of deferred taxes, were $98.4 million at December 31, 2024, compared to $80.6 million at September 30, 2024 and $103.3 million at December 31, 2023. CTBI’s annualized dividend yield to shareholders as of December 31, 2024 was 3.55%.
Asset Quality
Our total nonperforming loans increased to $26.7 million at December 31, 2024 from $25.1 million at September 30, 2024 and $14.0 million at December 31, 2023. Accruing loans 90+ days past due at $10.3 million decreased $8.8 million from prior quarter but increased $0.4 million from December 31, 2023. Nonaccrual loans at $16.4 million increased $10.4 million from prior quarter and $12.3 million from December 31, 2023. The increase in nonaccrual loans included an $8.0 million credit that is 80% USDA guaranteed. Accruing loans 30-89 days past due at $16.8 million decreased $3.7 million from prior quarter but increased $1.5 million from December 31, 2023. Our loan portfolio management processes focus on the immediate identification, management, and resolution of problem loans to maximize recovery and minimize loss.
We had net loan charge-offs of $1.0 million, or an annualized 0.09% of average loans, for the fourth quarter 2024 compared to $1.5 million, or an annualized 0.14% of average loans, for the third quarter 2024 and $1.0 million, or 0.10% of average loans annualized, for the fourth quarter 2023. Of the net charge-offs for the quarter, $0.5 million were in indirect consumer loans, $0.2 million were in commercial loans, $0.2 million were in direct consumer loans, and $0.1 million were in residential loans. Net loan charge-offs for the year 2024 were in line with management’s expectations at $5.5 million, or 0.13% of average loans, compared to $3.2 million, or 0.08% of average loans for the year 2023.
Allowance for Credit Losses
Our provision for credit losses at $2.6 million for the quarter decreased $0.1 million from prior quarter but increased $0.8 million from prior year same quarter. Of the provision for the quarter, $1.6 million was allotted to fund loan growth. Provision for credit losses for the year 2024 increased $4.1 million from the year 2023. Our reserve coverage (allowance for credit losses to nonperforming loans) at December 31, 2024 was 206.0% compared to 212.7% at September 30, 2024 and 354.7% at December 31, 2023. Our credit loss reserve as a percentage of total loans outstanding at December 31, 2024 remained at 1.23% from September 30, 2024 compared to 1.22% at December 31, 2023.
Forward-Looking Statements
Certain of the statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. CTBI’s actual results may differ materially from those included in the forward-looking statements. Forward-looking statements are typically identified by words or phrases such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “may increase,” “may fluctuate,” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” and “could.” These forward-looking statements involve risks and uncertainties including, but not limited to, economic conditions, portfolio growth, the credit performance of the portfolios, including bankruptcies, and seasonal factors; changes in general economic conditions including the performance of financial markets, prevailing inflation and interest rates, realized gains from sales of investments, gains from asset sales, and losses on commercial lending activities; the effects of epidemics, pandemics, or other infectious disease outbreaks; results of various investment activities; the effects of competitors’ pricing policies, changes in laws and regulations, competition, and demographic changes on target market populations’ savings and financial planning needs; industry changes in information technology systems on which we are highly dependent; failure of acquisitions to produce revenue enhancements or cost savings at levels or within the time frames originally anticipated or unforeseen integration difficulties; and the resolution of legal proceedings and related matters. In addition, the banking industry in general is subject to various monetary, operational, and fiscal policies and regulations, which include, but are not limited to, those determined by the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Consumer Financial Protection Bureau, and state regulators, whose policies, regulations, and enforcement actions could affect CTBI’s results. These statements are representative only on the date hereof, and CTBI undertakes no obligation to update any forward-looking statements made.
Community Trust Bancorp, Inc., with assets of $6.2 billion, is headquartered in Pikeville, Kentucky and has 72 banking locations across eastern, northeastern, central, and south central Kentucky, six banking locations in southern West Virginia, three banking locations in northeastern Tennessee, four trust offices across Kentucky, and one trust office in Tennessee.
Additional information follows.
| Community Trust Bancorp, Inc. | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Financial Summary (Unaudited) | |||||||||||||||
| December 31, 2024 | |||||||||||||||
| (in thousands except per share data and # of employees) | |||||||||||||||
| Three | Three | Three | Twelve | Twelve | |||||||||||
| Months | Months | Months | Months | Months | |||||||||||
| Ended | Ended | Ended | Ended | Ended | |||||||||||
| December 31, 2024 | September 30, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||||||||
| Interest income | $ | 81,979 | $ | 79,814 | $ | 73,329 | $ | 313,443 | $ | 268,650 | |||||
| Interest expense | 32,452 | 32,615 | 30,354 | 127,448 | 95,540 | ||||||||||
| Net interest income | 49,527 | 47,199 | 42,975 | 185,995 | 173,110 | ||||||||||
| Loan loss provision | 2,587 | 2,736 | 1,815 | 10,951 | 6,811 | ||||||||||
| Gains on sales of loans | 50 | 80 | 54 | 294 | 395 | ||||||||||
| Deposit related fees | 7,619 | 7,886 | 7,312 | 29,824 | 29,935 | ||||||||||
| Trust revenue | 3,961 | 3,707 | 3,318 | 14,921 | 13,025 | ||||||||||
| Loan related fees | 1,472 | 813 | 467 | 4,957 | 3,792 | ||||||||||
| Securities gains (losses) | 521 | 213 | 258 | 631 | 996 | ||||||||||
| Other noninterest income | 2,537 | 2,864 | 2,316 | 11,938 | 9,516 | ||||||||||
| Total noninterest income | 16,160 | 15,563 | 13,725 | 62,565 | 57,659 | ||||||||||
| Personnel expense | 20,193 | 19,521 | 18,445 | 79,427 | 73,711 | ||||||||||
| Occupancy and equipment | 3,015 | 3,072 | 3,045 | 12,204 | 11,843 | ||||||||||
| Data processing expense | 3,181 | 2,804 | 2,630 | 11,172 | 9,726 | ||||||||||
| FDIC insurance premiums | 670 | 629 | 655 | 2,586 | 2,483 | ||||||||||
| Other noninterest expense | 6,710 | 6,486 | 6,853 | 25,534 | 27,627 | ||||||||||
| Total noninterest expense | 33,769 | 32,512 | 31,628 | 130,923 | 125,390 | ||||||||||
| Net income before taxes | 29,331 | 27,514 | 23,257 | 106,686 | 98,568 | ||||||||||
| Income taxes | 6,838 | 5,372 | 4,598 | 23,873 | 20,564 | ||||||||||
| Net income | $ | 22,493 | $ | 22,142 | $ | 18,659 | $ | 82,813 | $ | 78,004 | |||||
| Memo: TEQ interest income | $ | 82,252 | $ | 80,094 | $ | 73,626 | $ | 314,582 | $ | 269,841 | |||||
| Average shares outstanding | 17,971 | 17,962 | 17,901 | 17,950 | 17,887 | ||||||||||
| Diluted average shares outstanding | 18,009 | 17,991 | 17,926 | 17,977 | 17,900 | ||||||||||
| Basic earnings per share | $ | 1.25 | $ | 1.23 | $ | 1.04 | $ | 4.61 | $ | 4.36 | |||||
| Diluted earnings per share | $ | 1.25 | $ | 1.23 | $ | 1.04 | $ | 4.61 | $ | 4.36 | |||||
| Dividends per share | $ | 0.47 | $ | 0.47 | $ | 0.46 | $ | 1.86 | $ | 1.80 | |||||
| Average balances: | |||||||||||||||
| Loans | $ | 4,399,291 | $ | 4,300,652 | $ | 4,022,547 | $ | 4,247,762 | $ | 3,888,585 | |||||
| Earning assets | 5,779,438 | 5,570,160 | 5,377,827 | 5,569,948 | 5,244,128 | ||||||||||
| Total assets | 6,100,136 | 5,891,157 | 5,713,977 | 5,893,995 | 5,572,141 | ||||||||||
| Deposits, including repurchase agreements | 5,215,204 | 5,014,506 | 4,916,208 | 5,036,906 | 4,771,106 | ||||||||||
| Interest bearing liabilities | 4,059,061 | 3,859,978 | 3,687,660 | 3,867,733 | 3,514,142 | ||||||||||
| Shareholders' equity | 760,223 | 748,098 | 674,349 | 732,119 | 663,664 | ||||||||||
| Performance ratios: | |||||||||||||||
| Return on average assets | 1.47 | % | 1.50 | % | 1.30 | % | 1.41 | % | 1.40 | % | |||||
| Return on average equity | 11.77 | % | 11.77 | % | 10.98 | % | 11.31 | % | 11.75 | % | |||||
| Yield on average earning assets (tax equivalent) | 5.66 | % | 5.72 | % | 5.43 | % | 5.65 | % | 5.15 | % | |||||
| Cost of interest bearing funds (tax equivalent) | 3.18 | % | 3.36 | % | 3.27 | % | 3.30 | % | 2.72 | % | |||||
| Net interest margin (tax equivalent) | 3.43 | % | 3.39 | % | 3.19 | % | 3.36 | % | 3.32 | % | |||||
| Efficiency ratio (tax equivalent) | 51.60 | % | 51.75 | % | 55.74 | % | 52.57 | % | 54.29 | % | |||||
| Loan charge-offs | $ | 2,264 | $ | 2,736 | $ | 2,529 | $ | 10,503 | $ | 8,259 | |||||
| Recoveries | (1,285 | ) | (1,212 | ) | (1,538 | ) | (4,977 | ) | (5,010 | ) | |||||
| Net charge-offs | $ | 979 | $ | 1,524 | $ | 991 | $ | 5,526 | $ | 3,249 | |||||
| Market Price: | |||||||||||||||
| High | $ | 61.66 | $ | 52.22 | $ | 45.74 | $ | 61.66 | $ | 47.35 | |||||
| Low | $ | 46.55 | $ | 41.50 | $ | 33.91 | $ | 38.44 | $ | 32.68 | |||||
| Close | $ | 53.03 | $ | 49.66 | $ | 43.86 | $ | 53.03 | $ | 43.86 |
| Community Trust Bancorp, Inc. | ||||||||
|---|---|---|---|---|---|---|---|---|
| Financial Summary (Unaudited) | ||||||||
| December 31, 2024 | ||||||||
| (in thousands except per share data and # of employees) | ||||||||
| As of | As of | |||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| September 30, 2024 | December 31, 2023 | |||||||
| Assets: | ||||||||
| Loans | 4,486,637 | $ | 4,350,474 | $ | 4,050,906 | |||
| Loan loss reserve | (54,968 | ) | (53,360 | ) | (49,543 | ) | ||
| Net loans | 4,431,669 | 4,297,114 | 4,001,363 | |||||
| Loans held for sale | 184 | 115 | 152 | |||||
| Securities AFS | 1,055,728 | 1,098,076 | 1,163,724 | |||||
| Equity securities at fair value | 3,781 | 3,266 | 3,158 | |||||
| Other equity investments | 9,949 | 10,060 | 9,599 | |||||
| Other earning assets | 298,580 | 157,092 | 214,664 | |||||
| Cash and due from banks | 73,021 | 85,944 | 58,833 | |||||
| Premises and equipment | 49,630 | 47,519 | 45,311 | |||||
| Right of use asset | 14,385 | 14,718 | 15,703 | |||||
| Goodwill and core deposit intangible | 65,490 | 65,490 | 65,490 | |||||
| Other assets | 190,828 | 183,574 | 191,699 | |||||
| Total Assets | 6,193,245 | $ | 5,962,968 | $ | 5,769,696 | |||
| Liabilities and Equity: | ||||||||
| Interest bearing checking | 167,736 | $ | 156,249 | $ | 123,927 | |||
| Savings deposits | 2,292,793 | 2,160,691 | 2,060,600 | |||||
| CD's >=100,000 | 795,619 | 753,253 | 704,222 | |||||
| Other time deposits | 571,365 | 563,554 | 575,183 | |||||
| Total interest bearing deposits | 3,827,513 | 3,633,747 | 3,463,932 | |||||
| Noninterest bearing deposits | 1,242,676 | 1,204,515 | 1,260,690 | |||||
| Total deposits | 5,070,189 | 4,838,262 | 4,724,622 | |||||
| Repurchase agreements | 240,166 | 233,324 | 225,245 | |||||
| Other interest bearing liabilities | 64,830 | 64,893 | 65,075 | |||||
| Lease liability | 15,190 | 15,530 | 16,393 | |||||
| Other noninterest bearing liabilities | 45,286 | 50,197 | 36,153 | |||||
| Total liabilities | 5,435,661 | 5,202,206 | 5,067,488 | |||||
| Shareholders' equity | 757,584 | 760,762 | 702,208 | |||||
| Total Liabilities and Equity | 6,193,245 | $ | 5,962,968 | $ | 5,769,696 | |||
| Ending shares outstanding | 18,058 | 18,052 | 18,000 | |||||
| 30 - 89 days past due loans | 16,833 | $ | 20,578 | $ | 15,343 | |||
| 90 days past due loans | 10,317 | 19,111 | 9,920 | |||||
| Nonaccrual loans | 16,369 | 5,980 | 4,048 | |||||
| Foreclosed properties | 3,647 | 1,344 | 1,616 | |||||
| Community bank leverage ratio | 13.76 | % | 13.99 | % | 13.69 | % | ||
| Tangible equity to tangible assets ratio | 11.30 | % | 11.79 | % | 11.16 | % | ||
| FTE employees | 934 | 943 | 967 |
All values are in US Dollars.