HBNC

The headline FY2025 numbers look catastrophic — a $150M net loss, EPS of -$3.24, ROE of -21.9% and a 17.5% shrinkage in total assets to $6.44B — but the MD&A makes clear this is a one-time, self-inflicted reset, not operating deterioration. Management reclassified $1.8B of held-to-maturity securities to available-for-sale (unmasking a $282.6M unrealized loss) and sold $1.4B of bonds for a pre-tax loss of $299.5M, then recycled proceeds into higher-yielding commercial loans. The Q4 run-rate validates the move: net interest income of $63.5M (+19.5% YoY), FTE NIM of 4.29% (vs. 2.97% a year ago, expanding for the ninth consecutive quarter), ROA of 1.63% and ROE of 15.71% — the profile of a healthy community bank, not a distressed one.