8-K: First Busey Corporation Announces First Quarter 2025 Results, Impacted by CrossFirst Acquisition

First Busey Corporation reports a net loss for the first quarter of 2025, significantly influenced by the recent acquisition of CrossFirst Bankshares, Inc.

Summary

• First Busey Corporation reported a net loss of $(30.0) million, or $(0.44) per diluted common share, for the first quarter of 2025.
• This compares to a net income of $28.1 million, or $0.49 per diluted common share, for the fourth quarter of 2024.
• The results were significantly impacted by the acquisition of CrossFirst Bankshares, Inc. on March 1, 2025.
• Adjusted net income, excluding non-GAAP adjustments, was $39.9 million, or $0.57 per diluted common share.
• Net interest income was $103.7 million, and the net interest margin was 3.16%.
• Total assets reached $19.46 billion as of March 31, 2025.
• The company resumed stock repurchases, buying back 220,000 shares at an average price of $21.98 per share.
• CrossFirst Bank is expected to be merged with and into Busey Bank on June 20, 2025.

Sentiment

Score: 6

Explanation: The sentiment is neutral to slightly positive. While the company reported a net loss, it highlights adjusted figures that show profitability and emphasizes the strategic benefits of the CrossFirst acquisition. The forward-looking statements are cautiously optimistic.

Positives

• The acquisition of CrossFirst Bankshares, Inc. is expected to be accretive to tangible book value.
• Adjusted net income was $39.9 million, or $0.57 per diluted common share.
• Net interest margin increased to 3.16% for the first quarter of 2025.
• The company resumed stock repurchases, buying back 220,000 shares at an average price of $21.98 per share.
• Wealth management fees increased by 3.4% compared to the fourth quarter of 2024.
• The Wealth Management segment reported another quarter of record high revenue for the first quarter of 2025.
• Adjusted efficiency ratio was 58.7% for the first quarter of 2025.
• Tangible book value per common share increased to $18.62 at March 31, 2025, reflecting a 10.6% year-over-year increase.

Negatives

• The company reported a net loss of $(30.0) million, or $(0.44) per diluted common share, for the first quarter of 2025.
• Total noninterest income decreased by 39.7% compared to the fourth quarter of 2024, primarily due to net securities losses.
• Total noninterest expense increased by 47.3% compared to the fourth quarter of 2024.
• Efficiency ratio was 79.3% for the first quarter of 2025, compared to 64.5% for the fourth quarter of 2024.
• Non-performing assets represented 0.31% of total assets as of March 31, 2025, a 12 basis point increase from December 31, 2024.

Risks

• Integration risks associated with the CrossFirst acquisition.
• Potential for failure to realize anticipated benefits of the CrossFirst acquisition.
• Economic conditions and financial market volatility.
• Changes in interest rates and prepayment rates.
• Credit risk and risk from concentrations within the loan portfolio.
• Liquidity risk and dependence on non-core funding sources.
• Cybersecurity-related incidents.

Future Outlook

Busey projects further net interest margin expansion during the second quarter of 2025 and anticipates cost saves of ~$25 million from the CrossFirst acquisition, with 50% overall realization in 2025 and 100% in 2026.

Management Comments

• Van A. Dukeman, Chairman and Chief Executive Officer, stated that the transformative partnership between Busey and CrossFirst takes the organization to new heights.
• Van A. Dukeman expressed gratitude for the opportunities to consistently earn the business of customers, based on the contributions of talented associates and the continued support of loyal shareholders.

Industry Context

The acquisition of CrossFirst Bankshares, Inc. reflects a trend of consolidation in the banking industry, as institutions seek to expand their geographic footprint and service offerings to remain competitive.

Comparison to Industry Standards

• The document references KRX Median values for certain metrics, suggesting a comparison to a peer group of banks.
• Busey's adjusted efficiency ratio of 58.7% is compared to the KRX Median.
• Busey's non-performing assets to total assets ratio is compared to the KRX Median.
• The document compares Busey's performance to its own historical performance and provides forward-looking projections.

Stakeholder Impact

• Shareholders will be impacted by the net loss and the strategic decisions related to the CrossFirst acquisition.
• Employees will be impacted by the integration of CrossFirst Bank and potential cost-saving measures.
• Customers will benefit from the expanded service offerings and geographic reach resulting from the acquisition.

Next Steps

• Merge CrossFirst Bank with and into Busey Bank on June 20, 2025.
• Continue to integrate CrossFirst Bank operations.
• Realize cost synergies from the CrossFirst acquisition.
• Deploy excess cash to reduce wholesale funding levels.
• Evaluate and execute off-balance sheet hedging and balance sheet repositioning strategies.

Key Dates

Keywords

First Busey Corporation, CrossFirst Bankshares, acquisition, financial results, net income, earnings, net interest margin, assets, deposits, stock repurchase, wealth management, noninterest income, noninterest expense, capital ratios, liquidity