Company: ONBPP
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0000707179-25-000009
Chunk: 24

Company: OLD NATIONAL BANCORP /IN/
Filing Date: 2025-04-30
Form: 10-Q
Item: Item 1
Chunk 24
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,522)— (392,522)Net loans$35,893,365 $— $35,893,365 (1)Includes direct finance leases of $107.5 million at March 31, 2025 and $120.6 million at December 31, 2024.(2)    Includes unearned income of $122.3 million at March 31, 2025 and $163.3 million at December 31, 2024.The risk characteristics of each loan portfolio segment are as follows:CommercialCommercial loans are classified primarily on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not be as expected and the collateral securing these loans may fluctuate in value. Most commercial loans are secured by the assets being financed or other business assets such as accounts receivable or inventory and may incorporate a personal guarantee; however, some loans may be made on an unsecured basis. In the case of loans secured by accounts receivable, the availability of funds for the repayment of these loans may be substantially dependent on the ability of the borrower to collect amounts due from its clients.Commercial Real EstateCommercial real estate loans are classified primarily as cash flow loans and secondarily as loans secured by real estate. Commercial real estate lending typically involves higher loan principal amounts, and the repayment of these loans is generally dependent on the successful operation of the property securing the loan or the business conducted 

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on the property securing the loan. Commercial real estate loans may be adversely affected by conditions in the real estate markets or in the general economy. The properties securing Old National’s commercial real estate portfolio are diverse in terms of type and geographic location. Management monitors and evaluates commercial real estate loans based on collateral, geography, and risk grade criteria. In addition, management tracks the level of owner-occupied commercial real estate loans versus non-owner-occupied loans.Included with commercial real estate are construction loans, which are underwritten utilizing independent appraisal reviews, sensitivity analysis of absorption and lease rates, financial analysis of the developers and property owners, and feasibility studies, if available. Construction loans are generally based on estimates of costs and value associated with the complete project. These estimates may be inaccurate. Construction loans often involve the disbursement of substantial funds with repayment substantially dependent on the success of the ultimate project. Sources of repayment for these types of loans may be pre-committed permanent loans from approved long