Eagle Bancorp Montana reports stable Q2 earnings, loan growth

HELENA - Eagle Bancorp Montana, Inc. (NASDAQ:EBMT), the holding company of Opportunity Bank of Montana, reported net income of $3.2 million, or $0.41 per diluted share, for the second quarter of 2025, matching the previous quarter’s results and improving from $1.7 million, or $0.22 per diluted share, in the same period last year. With a market capitalization of $131 million and trading at a P/E ratio of 11.6, InvestingPro analysis suggests the stock is currently undervalued relative to its Fair Value.

The company’s net interest margin expanded to 3.91% in the second quarter, up 17 basis points from the previous quarter and 50 basis points higher than a year ago. This improvement was driven by higher yields on interest-earning assets and declining funding costs. According to InvestingPro data, the company maintains strong financial metrics with a notably low PEG ratio of 0.43, suggesting attractive growth potential relative to its current valuation.

Total loans increased 3.4% to $1.57 billion compared to a year earlier, with commercial real estate loans rising 7.6% to $675.3 million and agricultural and farmland loans growing 13.5% to $317.3 million. InvestingPro highlights that Eagle Bancorp has maintained dividend payments for 26 consecutive years and has raised its dividend for 13 straight years, demonstrating consistent shareholder returns alongside its loan portfolio growth.

"We delivered strong financial results for the second quarter of 2025, marked by growth in both loans and deposits, as well as continued expansion in our net interest margin," said Laura F. Clark, President and CEO, in a statement based on the company’s press release.

Total deposits increased 7.4% to $1.74 billion from a year ago, with noninterest-bearing checking accounts representing 24% of the total deposit portfolio. The average cost of deposits was 1.62% in the second quarter, down from 1.67% in the preceding quarter and 1.70% a year ago.

Revenue increased 9.7% to $23 million compared to the previous quarter and 15.3% from a year earlier. Noninterest income rose 19.7% to $4.8 million from the previous quarter, primarily due to higher mortgage banking income.

The bank’s board declared a quarterly cash dividend of $0.145 per share, payable September 5 to shareholders of record on August 15, representing an annualized yield of 3.47% based on current market prices. This attractive yield is supported by the company’s strong dividend history and sustainable payout ratio, as confirmed by multiple additional dividend metrics available on InvestingPro.

The allowance for credit losses represented 1.13% of portfolio loans and 348.8% of nonperforming loans. Nonperforming loans were $5.1 million, or 0.32% of total loans.

Eagle Bancorp Montana operates 30 banking offices throughout Montana.

In other recent news, Eagle Bancorp Montana, Inc. has appointed Baker Tilly US, LLP as its new independent registered public accounting firm. This change follows a merger between the company’s former auditor, Moss Adams LLP, and Baker Tilly. The transition was approved by Eagle Bancorp’s audit committee. Notably, Moss Adams’ audit reports for 2023 and 2024 did not contain any adverse opinions, although there was an adverse opinion regarding the company’s internal control effectiveness as of December 31, 2024. Additionally, Eagle Bancorp Montana’s shareholders have approved all five proposals during the company’s Annual Meeting. The meeting included the election of three directors, Maureen J. Rude, Rick F. Hays, and Peter J. Johnson, to serve three-year terms. The directors received significant support, with millions of shares voted in their favor.

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