Berkshire Hills Bancorp, Inc. (NYSE: BHLB) has reported strong first quarter 2025 results, with a 22% increase in operating earnings per share (EPS) year-over-year. The operating EPS for the first quarter was $0.60, up from $0.49 in the same period last year. The operating revenue increased by 5%, while operating non-interest expense decreased by 6% year-over-year.
The net interest margin increased by 10 basis points to 3.24% compared to the previous quarter. The efficiency ratio also improved to 59.5%, marking the best result in two years. Delinquent and non-performing loans to total loans stood at 0.42%, the lowest level in nearly two decades.
Net income for the first quarter of 2025 was $25.7 million, compared to $19.7 million in the previous quarter and a loss of $20.2 million in the first quarter of 2024. Similarly, operating earnings were $27.6 million for the first quarter of 2025, up from $26.0 million in the previous quarter and $20.9 million in the first quarter of 2024.
Net interest income, on a fully taxable equivalent (FTE) basis, was $91.7 million, up from $88.8 million in the previous quarter and $90.1 million in the first quarter of 2024. Non-interest income was $20.7 million for the first quarter of 2025, compared to $23.3 million in the previous quarter and a loss of $32.6 million in the first quarter of 2024.
On the expense side, non-interest expense was $70.4 million for the first quarter of 2025, down from $77.6 million in the previous quarter and $76.0 million in the first quarter of 2024. Operating non-interest expense was $67.9 million, compared to $71.0 million in the previous quarter and $72.4 million in the first quarter of 2024.
The first quarter net loan charge-offs to average loans was 0.15%, slightly up from 0.14% in the previous quarter, but down from 0.18% in the first quarter of 2024. Non-performing loans to total loans stood at 0.25%, slightly down from 0.26% in the previous quarter and up from 0.24% in the first quarter of 2024.
Return on average assets was 0.88% for the first quarter of 2025, up from 0.68% in the previous quarter and a negative 0.69% in the first quarter of 2024. The operating return on average assets was 0.94% for the first quarter of 2025, up from 0.90% in the previous quarter and 0.71% in the first quarter of 2024.
Berkshire's CEO, Nitin Mhatre, noted that the increase in first quarter operating EPS reflects revenue growth and improved efficiency, including the cumulative benefit of last year’s strategic initiatives. Operating leverage was a positive 5% quarter-over-quarter and 11% year-over-year. The period-end loans were up 4% year-over-year, with growth continuing quarter-over-quarter.
Berkshire Hills Bancorp, Inc. is the parent company of Berkshire Bank, with $12.0 billion in assets and 83 financial centers in New England and New York. The company has a pending agreement to merge with Brookline Bancorp, Inc., a multi-bank holding company with $11.5 billion in assets and branches in Massachusetts, Rhode Island, and New York. The market has reacted to these announcements by moving the company's shares 2.9% to a price of $25.01. For more information, read the company's full 8-K submission here.
