- Carter Bankshares (CARE, Financial) reported Q1 2025 net income of $9.0 million, up from $8.3 million in Q4 2024.
- Net interest margin improved to 2.70%, with total deposits increasing by $47.5 million quarter-over-quarter.
- Nonperforming loans (NPLs) increased to $261.4 million, with Justice Entities loans remaining on nonaccrual status.
Carter Bankshares, Inc. (CARE) has announced its financial results for the first quarter of 2025, reporting a net income of $9.0 million, or $0.39 diluted earnings per share. This represents an improvement from the previous quarter's net income of $8.3 million ($0.36 EPS) and a significant increase from the $5.8 million ($0.25 EPS) reported in the same quarter last year.
Noteworthy is the bank's net interest margin, which saw an enhancement to 2.70%, up 12 basis points from the last quarter. Total portfolio loans grew by $62.7 million, reflecting an annualized growth rate of 7.0%, pushing the total to $3.7 billion at the end of the quarter.
The quarter saw total deposits rise by $47.5 million (4.6% annualized) compared to the previous quarter, signaling robust deposit growth. However, nonperforming loans increased by $2.1 million to $261.4 million, amounting to 7.09% of total portfolio loans.
A significant headwind continues to be the largest credit relationship with the Justice Entities, which remains on nonaccrual status. This has adversely affected interest income by $6.8 million during the quarter. Despite receiving $6.9 million in curtailment payments, the Justice Entities loans' principal balance still stands at $245.1 million.
Looking forward, Carter Bankshares is preparing to finalize a branch acquisition, which is expected to bring in an additional $60 million in deposits, further strengthening the bank's funding base. The company remains focused on core deposit acquisition, diversified loan growth, and increasing noninterest income as strategic priorities for 2025.
