Heartland Financial USA, Inc. (HTLF) reported its financial results for the third quarter and the nine months ended September 30, 2024, reflecting a mixed performance in terms of revenue, profitability, and strategic developments.

For the third quarter of 2024, HTLF achieved a net income of $64.2 million, a 33% increase from $48.1 million in the same period of 2023. Earnings per diluted share rose to $1.44, compared to $1.08 in Q3 2023. Net interest income also increased by 8% to $157.9 million, up from $145.8 million year-over-year. Total revenue for the quarter was $176.9 million, a slight increase of 2% from $174.1 million in Q3 2023. However, noninterest income saw a significant decline, dropping 33% to $19.0 million from $28.4 million in the prior year.

For the nine months ended September 30, 2024, net income was $155.6 million, a modest increase from $150.3 million in the same period of 2023. Total revenue for this period decreased slightly to $535.7 million from $536.0 million year-over-year. The company reported a net interest margin of 3.73%, up from 3.14% in Q3 2023, indicating improved efficiency in generating income from its assets.

HTLF's total assets decreased to $18.27 billion as of September 30, 2024, down from $19.41 billion at the end of 2023. Total loans held to maturity also fell by 5% to $11.44 billion, with notable declines in commercial and industrial loans and residential mortgage loans. Conversely, cash and cash equivalents increased significantly to $588.4 million from $323.0 million at the end of 2023.

The company’s total deposits decreased by 8% to $14.95 billion, primarily due to a reduction in demand deposits. However, savings deposits increased by 4%, reflecting a shift in customer preferences. HTLF also reported a significant increase in its total stockholders' equity, which rose to $2.14 billion from $1.93 billion at the end of 2023.

Strategically, HTLF terminated interest rate swaps in early October 2024, aimed at mitigating unrealized securities losses and adjusting loan rates. The company also repaid a $500 million advance from the Bank Term Funding Program in November 2024. Additionally, HTLF recognized a gain of $29.7 million from the sale of Rocky Mountain Bank branches, which included loans and deposits.

Overall, while HTLF demonstrated growth in net income and net interest income, challenges in noninterest income and a decrease in total assets and loans highlight the complexities of the current market environment.