First Interstate Bancsystem Inc.: Q3 FY2025 earnings call

What management said about Q3 FY2025, from the documents filed with the SEC on 29 October 2025: press release. Guidance figures: 1 new, 1 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Net income flat on second quarter: Net income was $71.4 million, or $0.69 diluted EPS, against $71.7 million and $0.69 in the second quarter, and $55.5 million, $0.54 a year earlier. Source
• Net interest margin rose to 3.34%: Net interest margin was 3.34%, against 3.30% in the second quarter and 3.01% a year earlier. Excluding acquired-loan accretion, the adjusted FTE margin was 3.30%, up 4 basis points. Source
• No provision for credit losses: No provision was recorded, against a $0.3 million reduction in the second quarter and a $19.8 million provision a year earlier. Source
• Non-performing assets declined: Non-performing assets were $185.6 million, down $11.9 million from the second quarter and up $6.7 million from a year earlier. They were 1.17% of loans held for investment and OREO. Source
• CET1 ratio rose to 13.90%: The common equity tier 1 ratio rose 47 basis points, mainly from lower risk-weighted assets. Total risk-based capital was 16.62% and the leverage ratio 9.60%, marked preliminary. Source
• Organic growth plan continues: Management said it is executing its strategic plan, announced earlier this year, to focus on organic growth and support customers with its balance sheet. Source

“We continue to execute on our strategic plan, announced earlier this year, to focus on organic growth”

James A Reuter, President and Chief Executive Officer

Guidance

What changed from last quarter

• New: The company adopted a $150 million stock repurchase program on August 28, 2025. Source
• Ended: Sale of the Arizona and Kansas branches closed on October 10, 2025, after quarter end. Source
• Ended: Subordinated notes of $100.0 million, with a 5.25% fixed-to-floating rate, were paid off in the quarter. Source

Earnings and growth drivers

• Net income flat on second quarter: Net income was $71.4 million, or $0.69 diluted EPS, against $71.7 million and $0.69 in the second quarter, and $55.5 million, $0.54 a year earlier. Source
• Pre-tax income and tax expense: Income before tax was $92.6 million, against $93.5 million in the second quarter. The income tax provision was $21.2 million, against $21.8 million. Source
• Net interest income edged lower: Net interest income was $206.8 million, down $0.4 million from the second quarter and up $1.3 million from a year earlier. Acquired-loan accretion was $3.5 million. Source

Net interest margin and funding

• Net interest margin rose to 3.34%: Net interest margin was 3.34%, against 3.30% in the second quarter and 3.01% a year earlier. Excluding acquired-loan accretion, the adjusted FTE margin was 3.30%, up 4 basis points. Source
• Other borrowings repaid to zero: Other borrowed funds reached zero from $250.0 million at June 30, funded by loan paydowns and maturities. Source
• Total assets and securities declined: Total assets were $27,332.9 million, down 0.8% from June 30. Investment securities were $7,305.8 million after $725.2 million of purchases in the quarter. Source

“Our net interest margin continued to improve, and we maintained a clear focus on managing expenses prudently, with a goal to drive long-term, profitable growth”

James A Reuter, President and Chief Executive Officer

Credit quality and provision

• No provision for credit losses: No provision was recorded, against a $0.3 million reduction in the second quarter and a $19.8 million provision a year earlier. Source
• Allowance rose to 1.30%: The allowance for credit losses was 1.30% of loans held for investment, up from 1.28%. Coverage of non-performing loans was 113.0%, against 108.0% in the second quarter. Source
• Net charge-offs decreased: Net charge-offs were $2.3 million, or 0.06% annualized, against $5.8 million (0.14%) in the second quarter and $27.4 million (0.60%) a year earlier. Source
• Non-performing assets declined: Non-performing assets were $185.6 million, down $11.9 million from the second quarter and up $6.7 million from a year earlier. They were 1.17% of loans held for investment and OREO. Source

Fee income and expenses

• Noninterest income rose $2.6 million: Noninterest income was $43.7 million. Other income was $5.9 million, against $2.8 million, as the second quarter carried a valuation allowance on loans moved to held for sale. Source
• Payment fees fell after card outsourcing: Payment services revenue was $16.8 million, down $1.0 million from the second quarter and $1.9 million from a year earlier, mainly from lower consumer card interchange. Source
• Noninterest expense rose $2.8 million: Noninterest expense was $157.9 million, up $2.8 million from the second quarter and down $1.5 million from a year earlier. Source
• Salaries rose on incentive accruals: Salaries and wages were $66.2 million, up $1.2 million from the second quarter, on higher salaries and short-term incentive accruals. Source
• Note issuance costs written off: Other expenses rose $1.4 million to $51.6 million, mainly from writing off issuance costs on the subordinated notes. Source

Loans and deposits

• Loans held for investment declined: Loans held for investment were $15,834.4 million, down 3.2% from June 30 and 12.2% from a year earlier. The loans-to-deposits ratio was 70.1%. Source
• Total deposits edged lower: Total deposits were $22,605.0 million, down $25.6 million from June 30 and $259.1 million, or 1.1%, from a year earlier. Source
• Noninterest bearing deposits eased: Noninterest bearing deposits were $5,555.7 million, down from $5,579.0 million in June. Interest bearing deposits were $17,049.3 million, against $17,051.6 million in June. Source

Capital and shareholder returns

• CET1 ratio rose to 13.90%: The common equity tier 1 ratio rose 47 basis points, mainly from lower risk-weighted assets. Total risk-based capital was 16.62% and the leverage ratio 9.60%, marked preliminary. Source
• Tangible book value per share up: Tangible book value per common share was $21.77, up from $21.29 in the second quarter. Book value per common share was $33.17. Source
• Quarter buybacks and dividends paid: About 0.8 million shares were repurchased in the quarter at a weighted average price of $32.58. Regular dividends of about $49.1 million were paid. Source
• Dividend yield 6.0% on average price: The declared dividend equates to a 6.0% annualized yield on the $31.11 average closing price in the third quarter. Source

Card sale, leadership and strategy

• Second-quarter card loan sale gain: A second-quarter gain on the sale of the consumer credit card loan portfolio partly offset the valuation allowance in other income. Source
• Credit to senior leaders and bankers: The CEO credited senior leaders and relationship bankers, both internal and recruited from other institutions, with driving the plan forward. Source
• Organic growth plan continues: Management said it is executing its strategic plan, announced earlier this year, to focus on organic growth and support customers with its balance sheet. Source

Figures management reported

Risks management discussed

• Financial: Criticized loans were $1,164.1 million, down $38.9 million from June 30 but up $560.8 million from a year earlier. Doubtful loans rose to $49.7 million from $30.3 million. Source
• Demand: Loan balances declined as the indirect portfolio amortized, and the company stopped originating indirect loans in the first quarter of 2025. Source
• Demand: Deposit decreases were in noninterest bearing and several interest bearing categories, partly offset by increases in other interest bearing categories. Source
• Operational: Noninterest expense was higher than a year earlier, with legal and consulting services increasing. Source

Earlier plans management reported on

• Not stated: The prior quarter said the margin continued to improve as expected; this quarter the margin rose again to 3.34%.

Other quarters

• Q2 FY2026 earnings call
• Q1 FY2026 earnings call
• Q4 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.