Oakworth Capital Inc. Reports Significant Earnings Growth
Oakworth Capital Inc. (OTCQX: OAKC) recently announced an impressive 24% increase in diluted earnings per share during the first half of the fiscal year when compared to the same period last year. The company's robust financial performance is driven by strong fundamentals across various metrics.
Key Financial Highlights
Income and Profitability Metrics
As of June 30, 2025, Oakworth's net income reached $9.4 million, marking a substantial 25% rise compared to $7.5 million generated in the previous year. The diluted earnings per share stood at $1.89, up from $1.53 in the same period of 2024, reflecting the company’s effective growth strategies.
The pre-tax pre-provision income saw a notable increase, totaling $14.5 million, which is 31% higher than the $11.1 million reported in the first half of 2024. Additionally, the company's revenue surged to $39.8 million, a commendable 18% growth from the $33.9 million reported last year, demonstrating a strong demand for their services.
Growth in Revenue Streams
Breaking down the revenue sources, Oakworth experienced a linked-quarter growth of 2% in net interest income and an attractive year-over-year growth of 23%. However, trust and wealth fees reported a 4% linked-quarter decline, contrasted with a 10% year-over-year growth, highlighting variability in certain service areas.
Moreover, non-interest expenses increased to $25.3 million, reflecting an 11% rise year-over-year, underlining the company’s continued investment in its growth and service capabilities. The return on average equity (ROAE) for the period was a solid 14.5%, and return on average assets (ROAA) stood at 1.0%, showcasing operational efficiency.
Wealth Management and Balance Sheet Strength
Growth in Assets
Oakworth's wealth assets climbed to $2.4 billion, representing a 10% increase from $2.2 billion reported a year earlier. This consistent growth in assets attests to the company's growing footprint in the wealth management sector. Additionally, loans increased by 15% year-over-year on an average basis and 10% on a period-end basis, culminating in total loans of $1.5 billion.
Deposits also saw robust growth, with average deposits up 16% and period-end deposits increasing to $1.6 billion, reflecting strong customer trust and loyalty. These results indicate Oakworth’s commitment to expanding its offerings while maintaining balance sheet strength.
Commitment to Safety and Soundness
In terms of credit quality, the company maintains impressive metrics. Their non-performing loans totaled $0.5 million, with zero loans past due for over 90 days. The company also holds a $5.4 million inventory of Other Real Estate Owned (OREO), complemented by a 1.2% allowance for credit losses, providing a cushion against future uncertainties.
Furthermore, Oakworth enjoys sturdy capital ratios, with total risk-based capital at 12.1%, Common Equity Tier 1 (CET1) at 10.9%, and Tier 1 leverage ratio at 9.7%, which altogether strengthens the firm's ability to navigate financial challenges.
Leadership Insight
Oakworth’s Chairman and CEO, Scott Reed, expressed optimism about the company’s performance, stating, "We continue to see positive momentum from our investments in people, processes, and technology in new and existing markets. We look forward to serving our clients and accelerating revenue in the back half of the year."
About Oakworth Capital Inc.
Oakworth Capital, Inc. serves as a bank holding entity for Oakworth Capital Bank (OTCQX: OAKC), which has been operational since 2008. With four offices in the Southeast, Oakworth provides comprehensive commercial and private banking, as well as wealth management and advisory services to clients throughout the United States.
The bank is recognized as one of American Banker's “Best Banks to Work For,” maintaining a leading position for six consecutive years and earning the second position most recently. Oakworth's client satisfaction metrics are noteworthy – its 2024 average Net Promoter Score (NPS) was an impressive 94, with a corresponding client retention rate of 95%.
As of the second quarter of 2025, Oakworth boasts total assets of $1.8 billion, gross loans of $1.5 billion, and deposits totaling $1.6 billion.
Frequently Asked Questions
What did Oakworth Capital Inc. report regarding its earnings?
Oakworth Capital Inc. reported a 24% increase in diluted earnings per share in the first half of 2025 compared to the previous year.
How much did Oakworth's net income grow?
The net income for Oakworth increased to $9.4 million, representing a 25% growth year-over-year.
What are Oakworth's capital ratios like?
As of June 30, 2025, Oakworth's total risk-based capital ratio was 12.1%, with CET1 at 10.9% and a Tier 1 leverage ratio of 9.7%.
How have Oakworth's wealth assets changed?
The company's wealth assets rose by 10% to reach $2.4 billion compared to the previous year.
Who is the CEO of Oakworth Capital Inc.?
The CEO of Oakworth Capital Inc. is Scott Reed, who has mentioned the positive momentum from investments in people and technology.
