Company: ONBPP
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0000707179-25-000018
Chunk: 111

Company: OLD NATIONAL BANCORP /IN/
Filing Date: 2025-07-30
Form: 10-Q
Item: Item 1
Chunk 111
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 months ended June 30, 2025 and 2024, respectively. The three months ended June 30, 2025 and 2024 included net charge-offs on PCD loans totaling 0.03% and 0.05% on an annualized basis of average loans, respectively. Net charge-offs on loans totaled $48.1 million during the six months ended June 30, 2025, compared to $25.8 million for the same period in 2024. Annualized, net charge-offs to average loans were 0.24% and 0.15% for the six months ended June 30, 2025 and 2024, respectively. The six months ended June 30, 2025 and 2024 included net charge-offs on PCD loans totaling 0.03% and 0.06% on an annualized basis of average loans, respectively.

Credit quality within the loans held for investment portfolio is continuously monitored by management and is reflected within the allowance for credit losses on loans. The allowance for credit losses is an estimate of expected losses inherent within the Company’s loans held for investment portfolio. Credit quality is assessed and monitored by evaluating various attributes and the results of those evaluations are utilized in underwriting new loans and in our process for estimating expected credit losses. Expected credit loss inherent in non-cancelable off-balance-sheet credit exposures (unfunded loan commitments) is accounted for as a separate liability included in other liabilities on the balance sheet. The allowance for credit losses on loans held for investment and unfunded loan commitments is adjusted by a credit loss expense, which is reported in earnings, and reduced by the charge-off of loan amounts, net of recoveries. Accrued interest receivable is excluded from the estimate of credit losses.

The allowance for credit loss estimation process involves procedures to consider the unique characteristics of our loan portfolio segments. These segments are further disaggregated into loan classes based on the level at which credit risk of the loan is monitored. When computing the level of expected credit losses, credit loss assumptions are estimated using a model that categorizes loan pools based on loss history, delinquency status, and other credit trends and risk characteristics, including current conditions and reasonable and supportable forecasts about the future. Determining the appropriateness of the allowance is complex and requires judgment by management about the effect of matters that are inherently uncertain. In future periods, evaluations of the overall loan portfolio, in light of the factors and forecasts then prevailing, may result in significant