- Net income for S&T Bancorp (STBA, Financial) increased to $33.4 million in Q1 2025, or $0.87 per diluted share.
- Customer deposits saw strong growth, increasing by $134.7 million, or 7.23% annualized.
- The net interest margin rose to 3.81%, improving by 4 basis points compared to the previous quarter.
S&T Bancorp, Inc. (NASDAQ: STBA) reported robust financial results for the first quarter of 2025. The bank achieved a net income of $33.4 million, translating to $0.87 per diluted share. This reflects an increase from the prior quarter's $33.1 million, or $0.86 per share, and a 7% rise compared to $31.2 million, or $0.81 per share, in the first quarter of 2024.
The company's performance was bolstered by improved return metrics, with a return on average assets (ROA) of 1.41% and a return on average equity (ROE) of 9.67%. The net interest margin (NIM) on a fully taxable equivalent (FTE) basis rose by 4 basis points to 3.81%, primarily due to effective liability management strategies.
Loan portfolio growth remained strong, with total loans increasing by $93.4 million, marking a 4.89% annualized growth rate. This was led by expansions in commercial real estate loans, which grew by $74.2 million, and commercial construction loans, which grew by $27.3 million.
Customer deposits experienced significant growth of $134.7 million, or 7.23% annualized, allowing S&T Bancorp to reduce higher-cost borrowings by $55.0 million to $195.3 million and brokered deposits by $24.9 million.
In terms of asset quality, S&T Bancorp reported a decrease in nonperforming assets to $22.4 million, representing 0.29% of total loans, down from 0.36% in the prior quarter. This improvement was driven by net loan recoveries and a reduced provision for credit losses, which resulted in a negative $3.0 million adjustment.
While noninterest income decreased slightly to $10.4 million due to seasonally slower customer activity, noninterest expenses were well-managed at $55.1 million, consistent with the previous quarter. The bank strategically repositioned its securities portfolio, incurring a $2.3 million realized loss but positioning itself for higher yields in the future.
