Company: ISBA
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0000842517-25-000099
Chunk: 67

Company: ISABELLA BANK CORP
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 67
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 respectively. The ETR in the first quarter 2025 included a one-time expense totaling $166 due to the taxes owed from the lifetime earnings on BOLI policies that were surrendered during the quarter. Excluding the one-time charge, the ETR was 15%, which is higher than the prior year quarter on higher pretax income.

Financial Condition (March 31, 2025 to December 31, 2024 comparison)

Total assets increased $16,346 to $2,102,587 as of March 31, 2025, primarily due to an increase of $38,681 in interest bearing cash, $18,997 in gross securities, and $10,951 increase in BOLI assets, offset by a $60,065 decrease in advances to mortgage brokers.

Our AFS securities portfolio totaled $513,040 at March 31, 2025, increasing $24,011 at the end of first quarter 2025. The increase was driven by $40,362 in purchases of collateralized mortgage obligation securities with a weighted-average yield of 4.56%. Amortization and maturities of $21,058 partially offset the increase from purchases. Net unrealized losses at March 31, 2025 totaled $21,473, or 4.02%, of the portfolio and improved during the quarter due to the treasury portfolio rapidly approaching maturity and a decrease in market yields. The par value and corresponding book yields that are estimated to mature or payoff by year include: $54,500 in principal with a weighted-average book yield of 2.34% over the remainder of 2025; $217,400 at 1.17% in 2026; and $63,400 at 1.86% in 2027.  Some of these securities amortize so the actual principal paydown may differ from these estimates.

Loans outstanding as of March 31, 2025 totaled $1,367,724. Since December 31, 2024, gross loans have decreased $55,847 as a result of a reduction in advance to mortgage brokers. However, the decline in this non-core loan product has provided liquidity and the opportunity to refocus on loans that can be recorded on our balance sheet for longer terms and help to mitigate interest rate risk. 

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Core loans, which excludes advances to mortgage brokers, grew $4,218, driven by the commercial real estate and commercial and industrial loan portfolios of $4,787 and $4