HBT Financial, Inc. Q1 2026 Filing Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended March 31, 2026. HBT Financial, Inc. is the holding company for Heartland Bank and Trust Company, operating primarily in Illinois, eastern Iowa, and suburban St. Louis. The quarter was defined by the completion of the acquisition of CNB Bank Shares, Inc. ("CNB") on March 1, 2026, which significantly expanded the Company's asset base and geographic footprint.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 | Change |
|---|---|---|---|
| Net Income | $11.2 million | $19.1 million | -$7.9 million (41.3% decrease) |
| Earnings Per Share (Diluted) | $0.34 | $0.60 | -$0.26 |
| Total Assets | $6.77 billion | $5.03 billion (avg) | +33.6% (vs. Dec 2025) |
| Total Loans | $4.69 billion | $3.46 billion (avg) | +35.6% (vs. Dec 2025) |
| Total Deposits | $5.80 billion | $4.33 billion (avg) | +33.1% (vs. Dec 2025) |
| Net Interest Income | $56.4 million | $48.7 million | +$7.7 million |
| Net Interest Margin | 4.20% | 4.12% | +8 bps |
| Provision for Credit Losses | ($0.2 million) benefit | $0.6 million expense | Improvement |
| Noninterest Expense | $52.4 million | $31.9 million | +$20.5 million |
| Efficiency Ratio | 76.56% | 53.85% | Worsened (due to acquisition costs) |
Material Changes vs. Prior Period
- Acquisition Impact: The CNB acquisition added $1.81 billion in assets, $1.30 billion in loans, and $1.52 billion in deposits. This drove the significant increase in balance sheet size and average balances.
- Expense Surge: Noninterest expenses increased by 64.2% year-over-year, primarily due to $15.7 million in one-time acquisition-related expenses (including $8.7 million in data processing and $4.0 million in salaries).
- Net Income Decline: Despite a $7.7 million increase in net interest income and a negative provision for credit losses, GAAP net income fell 41.3% due to the acquisition costs. Adjusted net income (excluding acquisition costs) was $22.6 million, an increase of 17.4% over the prior year.
- Capital Raise: The Company issued $85.0 million of fixed-to-floating rate subordinated notes in March 2026 to bolster capital resources.
- Asset Quality: Nonperforming assets increased to $14.4 million from $8.7 million at year-end 2025, largely attributable to $6.1 million of nonaccrual loans acquired from CNB.
Guidance, Outlook, and Risks
- Outlook: Management expects net interest margin to remain stable or increase with rising rates, though future decreases in market rates could pressure margins. The Company is focused on integrating CNB operations and realizing synergies.
- Dividends: The quarterly dividend was increased to $0.23 per share in Q1 2026.
- Stock Repurchases: The Company repurchased 602,855 shares in Q1 2026. Approximately $14.4 million remains available under the current $30.0 million authorization.
- Risks: Key risks include integration challenges with the CNB acquisition, interest rate volatility affecting net interest income, credit quality deterioration in the commercial real estate and agricultural sectors, and cybersecurity threats.
Investor Verification Checklist
- Acquisition Integration: Verify the timeline and cost realization for the CNB system conversion and operational integration.
- Adjusted Metrics: Review the reconciliation of Adjusted Net Income ($22.6 million) and Adjusted Efficiency Ratio (52.68%) to understand core operating performance excluding one-time costs.
- Asset Quality Trends: Monitor the specific risk ratings of the acquired CNB loan portfolio, particularly the $6.1 million in nonaccrual loans and $113 million in "Pass-Watch" loans.
- Deposit Stability: Assess the retention of the $1.52 billion in new deposits from CNB and the cost of funds trends.
- Capital Ratios: Confirm that the new subordinated notes and retained earnings maintain the Company and Bank in "Well Capitalized" status under regulatory requirements.