• Net Income (Full Year 2024): $13 million, an increase of 6.3% from the prior year.
• Net Income (Q4 2024): $3.3 million, compared to $2.6 million in Q4 2023.
• Net Interest Income (Full Year 2024): $45.7 million, an increase of 6%.
• Net Interest Income (Q4 2024): $12.4 million, an increase of $795,000 from Q3 2024.
• Noninterest Income (Full Year 2024): Increased by $1.5 million or approximately 13%.
• Noninterest Income (Q4 2024): $3.4 million, a decrease of $882,000 from Q3 2024.
• Efficiency Ratio (Q4 2024): 70.0%.
• Return on Average Assets (Q4 2024): 0.83%.
• Return on Average Equity (Q4 2024): 9.54%.
• Loan Growth (Q4 2024): Increased by $50.5 million or 20% annualized.
• Total Loan Balances: Nearly $1.1 billion.
• Deposit Growth (Q4 2024): Increased by $53 million.
• Net Interest Margin (Q4 2024): Increased 21 basis points to 3.51%.
• Allowance for Credit Losses: $12.8 million, representing 1.22% of gross loans.
• Stock Dividend: 5% stock dividend distributed, 24th consecutive year.
• Cash Dividend: $0.20 per share paid in Q4 2024; $0.21 per share declared for March 2025.

• Warning! GuruFocus has detected 7 Warning Signs with LARK.

Release Date: February 05, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Landmark Bancorp Inc (NASDAQ:LARK) reported a strong net income of $13 million for 2024, marking a 6.3% increase from the previous year.
• The company added $103.7 million in new loans, contributing to a 6% rise in net interest income to $45.7 million.
• Noninterest income grew by $1.5 million, approximately 13%, indicating diversified revenue streams.
• The efficiency ratio improved, reflecting well-controlled expenses and operational efficiency.
• Landmark Bancorp Inc (NASDAQ:LARK) maintained solid credit quality throughout the year, with low net credit losses and a robust allowance for credit losses totaling $12.8 million.

Negative Points

• Net income for the fourth quarter of 2024 decreased to $3.3 million from $3.9 million in the prior quarter, due to a decline in noninterest income and higher noninterest expenses.
• A securities loss of $1 million was recorded due to the sale of low-yielding U.S. Treasury securities.
• Noninterest income decreased by $882,000 compared to the prior quarter, impacted by lower sales of residential mortgages and a decline in gains from sales of premises and equipment.
• Noninterest expenses increased by $1.3 million, primarily due to higher professional fees and compensation costs.
• The efficiency ratio remains relatively high at 70%, indicating room for improvement in operational efficiency.

Q & A Highlights

Q: Can you provide more details on the impact of loan repricing and the potential for margin expansion if interest rates remain stable? A: Abigail Wendel, President and CEO, explained that while 30% of the loan portfolio is expected to reprice in 2025, the impact on margins will also depend on deposit side dynamics. Raymond McLanahan, Chief Credit Officer, added that the portfolio's response will depend on treasury performance and Federal Reserve actions. They anticipate margin expansion even in a stable rate environment due to strategic adjustments on the deposit side.

Q: How sustainable is the recent loan growth, and what are the expectations for the coming quarters? A: Abigail Wendel noted that the strong loan growth of $50.5 million in the last quarter was significant and set a positive foundation for 2025. While acknowledging the challenge of predicting pipeline status, she expressed confidence in the bank's commercial bankers and their ability to maintain a strong pipeline, although such high growth rates may not be necessary every quarter.

Q: Are there plans to hire more lenders, and have there been recent additions to the team? A: Abigail Wendel confirmed that they hired a new lender in Southwest Kansas recently and are continuously evaluating opportunities to add more lenders. The focus is on developing talent in key markets like Topeka and Manhattan, with ongoing recruitment efforts tailored to market needs.

Q: What is the strategic focus for Landmark Bancorp in 2025 beyond regular banking activities? A: Abigail Wendel emphasized investing in the company's infrastructure to enhance associate and customer experiences. The focus is on leveraging information and tools to improve service delivery and operational efficiency. She also highlighted the potential for mergers and acquisitions as part of their growth strategy, aiming to be a bank of choice for customers and potential partners.

Q: Can you discuss the profitability of the mortgage business and expectations for 2025? A: Abigail Wendel stated that while they do not disclose segment-specific profitability, the mortgage business operates leanly and is well-managed. The focus is on cross-selling opportunities and managing expenses effectively. She noted that the housing market dynamics, influenced by existing low-rate mortgages, might impact volume, but the team is focused on optimizing operations.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.