ConnectOne Bancorp's Q2 Net Income Jumps 44.5% on Strong Deposit Growth

TL;DR

**ConnectOne Bancorp is crushing it with deposit growth and a 44.5% net income jump, making it a solid buy in regional banking.**

AI Summary

ConnectOne Bancorp, Inc. reported a net income of $32,709 for the three months ended June 30, 2025, a significant increase from $22,638 for the same period in 2024, representing a 44.5% rise. For the six months ended June 30, 2025, net income was $72,779, up from $68,462 in the prior year, an increase of 6.3%. Diluted earnings per common share for the second quarter of 2025 were $0.328125, compared to $0.18 in Q2 2024. The company's total assets stood at $11,008,287 as of June 30, 2025, an increase from $8,853,958 at December 31, 2024. Core deposits reached $54,155,710 by June 30, 2025, up from $42,255,865 at December 31, 2024, indicating strong deposit growth. The filing also notes an increase in common stock shares outstanding to 50,270,162 as of June 30, 2025, from 38,370,317 at December 31, 2024. The company's strategic outlook appears focused on continued growth in deposits and assets, as evidenced by these financial improvements.

Why It Matters

ConnectOne Bancorp's robust 44.5% increase in Q2 2025 net income and substantial growth in core deposits signal strong operational performance and potential market share gains in a competitive banking landscape. This positive trend could attract investors seeking stable regional bank exposure, while employees may benefit from a growing and profitable institution. For customers, the increased deposit base suggests a healthy and reliable financial partner. In the broader market, this performance indicates resilience among regional banks, potentially easing concerns about sector stability.

Risk Assessment

Risk Level: low — The risk level is low given the significant increase in net income by 44.5% for Q2 2025 and a 6.3% increase year-to-date. Additionally, core deposits grew substantially from $42,255,865 at December 31, 2024, to $54,155,710 at June 30, 2025, indicating strong financial health and stability.

Analyst Insight

Investors should consider ConnectOne Bancorp (CNOBP) as a potential investment, given its strong Q2 2025 performance with a 44.5% net income increase and robust deposit growth. The company's financial health suggests a stable outlook, making it an attractive option for those seeking exposure to a growing regional bank.

Financial Highlights

total Assets

$11,008,287

net Income

$32,709

eps

$0.328125

Key Numbers

• $32,709 — Net Income (Q2 2025) (Increased 44.5% from Q2 2024's $22,638)
• $72,779 — Net Income (YTD June 2025) (Increased 6.3% from YTD June 2024's $68,462)
• $0.328125 — Diluted EPS (Q2 2025) (Up from $0.18 in Q2 2024)
• $11,008,287 — Total Assets (June 30, 2025) (Increased from $8,853,958 at December 31, 2024)
• $54,155,710 — Core Deposits (June 30, 2025) (Increased from $42,255,865 at December 31, 2024)
• 50,270,162 — Common Stock Shares Outstanding (June 30, 2025) (Increased from 38,370,317 at December 31, 2024)

Key Players & Entities

• ConnectOne Bancorp, Inc. (company) — filer of the 10-Q
• $32,709 (dollar_amount) — net income for Q2 2025
• $22,638 (dollar_amount) — net income for Q2 2024
• $72,779 (dollar_amount) — net income for six months ended June 30, 2025
• $68,462 (dollar_amount) — net income for six months ended June 30, 2024
• $0.328125 (dollar_amount) — diluted EPS for Q2 2025
• $0.18 (dollar_amount) — diluted EPS for Q2 2024
• $11,008,287 (dollar_amount) — total assets as of June 30, 2025
• $8,853,958 (dollar_amount) — total assets as of December 31, 2024
• $54,155,710 (dollar_amount) — core deposits as of June 30, 2025

FAQ

Industry Context

ConnectOne Bancorp operates within the commercial banking sector, a highly competitive industry characterized by evolving regulatory landscapes and increasing reliance on digital services. Banks are focused on deposit gathering, loan origination, and managing interest rate sensitivity. The current environment may see increased competition for deposits and a focus on maintaining net interest margins.

Regulatory Implications

As a financial institution, ConnectOne Bancorp is subject to stringent regulations from federal and state authorities, including capital requirements, liquidity standards, and consumer protection laws. Compliance with these regulations is critical to maintaining operational stability and avoiding penalties.

What Investors Should Do

1. Monitor deposit growth trends: The significant increase in core deposits to $54,155,710 is a positive sign of funding stability. Investors should watch for continued growth in this area.
2. Analyze asset growth drivers: Total assets have grown to $11,008,287. Understanding the composition and profitability of these new assets will be key.
3. Evaluate EPS trajectory: The substantial increase in Q2 2025 diluted EPS to $0.328125 from $0.18 in Q2 2024 warrants close observation for sustained improvement.
4. Assess share count changes: The increase in shares outstanding to 50,270,162 from 38,370,317 needs to be understood in the context of any capital raises or stock-based compensation.

Glossary

Secured Overnight Financing Rate (SOFR)

A benchmark interest rate for U.S. dollar-denominated derivatives and loans that is calculated using transactions that are traded, or are expected to be traded, on or before the rate-setting date. (Indicates the company's exposure to and management of floating-rate assets and liabilities, which are influenced by SOFR.)

Core Deposits

Deposits that are considered stable and less sensitive to interest rate changes, typically excluding brokered deposits or large, time-sensitive deposits. (Represents a key funding source for the bank, and growth here indicates a strong, stable deposit base.)

Year-Over-Year Comparison

Compared to the prior year's comparable period, ConnectOne Bancorp has demonstrated robust performance. Net income for Q2 2025 surged by 44.5% to $32,709, and diluted EPS more than doubled to $0.328125 from $0.18. Total assets have seen a significant increase, and core deposits have grown substantially, indicating a strengthening financial position and effective deposit-gathering strategies.

Filing Documents

• cnob20250630_10q.htm (10-Q) — 4236KB
• ex_811446.htm (EX-31.1) — 8KB
• ex_811447.htm (EX-31.2) — 8KB
• ex_811448.htm (EX-32.1) — 4KB
• ex_811449.htm (EX-32.2) — 4KB
• image1banklogo.jpg (GRAPHIC) — 7KB
• 0001437749-25-025881.txt ( ) — 18944KB
• cnob-20250630.xsd (EX-101.SCH) — 95KB
• cnob-20250630_cal.xml (EX-101.CAL) — 96KB
• cnob-20250630_def.xml (EX-101.DEF) — 742KB
• cnob-20250630_lab.xml (EX-101.LAB) — 585KB
• cnob-20250630_pre.xml (EX-101.PRE) — 787KB
• cnob20250630_10q_htm.xml (XML) — 4935KB

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements 3 Consolidated Statements of Condition as of June 30, 2025 (unaudited) and December 31, 2024 3 Consolidated Statements of Income for the three and six months ended June 30, 2025 and 2024 (unaudited) 4 Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2025 and 2024 (unaudited) 5 Consolidated Statements of Changes in Stockholders' Equity for the three and six months ended June 30, 2025 and 2024 (unaudited) 6 Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024 (unaudited) 8

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 10 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 54 Item 3. Qualitative and Quantitative Disclosures about Market Risks 74 Item 4.

Controls and Procedures

Controls and Procedures 74

– OTHER INFORMATION

PART II – OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 75 Item 1a.

Risk Factors

Risk Factors 75 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 75 Item 3. Defaults Upon Senior Securities 75 Item 4. Mine Safety Disclosures 75 Item 5. Other Information 75 Item 6. Exhibits 76

SIGNATURES

SIGNATURES 77 2 Table of Contents

Financial Statements

Item 1. Financial Statements CONNECTONE BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CONDITION (in thousands, except for share data) June 30, December 31, 2025 2024 (unaudited) ASSETS Cash and due from banks $ 97,792 $ 57,816 Interest-bearing deposits with banks 498,741 298,672 Cash and cash equivalents 596,533 356,488 Investment securities 1,227,200 612,847 Equity securities 19,707 20,092 Loans held-for-sale 1,027 743 Loans receivable 11,164,477 8,274,810 Less: Allowance for credit losses - loans 156,190 82,685 Net loans receivable 11,008,287 8,192,125 Investment in restricted stock, at cost 49,248 40,449 Bank premises and equipment, net 54,297 28,447 Accrued interest receivable 60,950 45,498 Bank owned life insurance 364,836 243,672 Right of use operating lease assets 31,282 14,489 Goodwill 215,611 208,372 Core deposit intangibles 66,315 4,639 Other assets 220,445 111,739 Total assets $ 13,915,738 $ 9,879,600 LIABILITIES Deposits: Noninterest-bearing $ 2,424,529 $ 1,422,044 Interest-bearing 8,853,958 6,398,070 Total deposits 11,278,487 7,820,114 Borrowings 783,859 688,064 Subordinated debentures, net 276,500 79,944 Operating lease liabilities 35,334 15,498 Other liabilities 45,127 34,276 Total liabilities 12,419,307 8,637,896 COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY Preferred Stock, no par value: 1,000 per share liquidation preference; Authorized 5,000,000 shares; issued 115,000 shares as of June 30, 2025 and as of December 31, 2024; outstanding 115,000 shares as of June 30, 2025 and as of December 31, 2024 110,927 110,927 Common stock, no par value: Authorized 100,000,000 shares; issued 54,155,710 shares as of June 30, 2025 and 42,255,865 shares as of December 31, 2024; outstanding 50,270,162 shares as of June 30, 2025 and 38,370,317 as of December 31, 2024 857,765 586,946 Additional paid-in capital 36,728 36,347 Retained earn

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 1a. Nature of Operations, Principles of Consolidation and Risk and Uncertainties Nature of Operations ConnectOne Bancorp, Inc. (the "Parent Corporation") is incorporated under the laws of the State of New Jersey and is a registered bank holding company under the Bank Holding Company Act of 1956, as amended (the "BHCA"). The Parent Corporation's business currently consists of the operation of its wholly-owned subsidiary, ConnectOne Bank (the "Bank" and, collectively with the Parent Corporation and the Parent Corporation's subsidiaries, the "Company") and making certain limited investments. The Bank's direct and indirect subsidiaries include Union Investment Co. (a New Jersey investment company), Twin Bridge Investment Co. (a Delaware investment company), ConnectOne Preferred Funding Corp. (a New Jersey real estate investment trust), Center Financial Group, LLC (a New Jersey financial services company), Center Advertising, Inc. (a New Jersey advertising company), Morris Property Company, LLC, (a New Jersey limited liability company), Volosin Holdings, LLC, (a New Jersey limited liability company), NJCB Spec- 1, LLC (a New Jersey limited liability company), Port Jervis Holdings, LLC (a New Jersey limited liability company), BONJ Special Properties, LLC (a New Jersey limited liability company). The First of Long Island REIT (a New York real estate investment trust), FNY Service Corp (a New York investment company) and BoeFly, Inc. (a New Jersey financial technology company). The Bank is a community-based, full-service New Jersey-chartered commercial bank that was founded in 2005. The Bank operates from its headquarters located at 301 Sylvan Avenue in the Borough of Englewood Cliffs, Bergen County, New Jersey and through its 59 other banking offices. On June 1, 2025, the Company completed its acquisition of The First of Long Island Corporation ("FLIC"), and The First National Bank of Long Island, FLIC's

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 1a. Nature of Operations, Principles of Consolidation and Risk and Uncertainties - (continued) Segment Reporting The Company's operations are solely in the financial services industry. The Company provides a range of regional community banking services to commercial and retail clients. The Company's reportable segment is determined by the Chief Executive Officer, who is designated the Chief Operating Decision Maker ("CODM"), based upon information about the Company's products and services offered, primarily it's banking operations. The segment is also distinguished by the level of information provided to the CODM, who uses such information to review performance of various components of the business (such as branches and the subsidiary bank), which are then aggregated if operating performance, products/services, and customers are similar. The CODM will evaluate the financial performance of the Company's business components such as by evaluating revenue streams, significant expenses, and budget to actual results in assessing the Company's segment and in the determination of allocating resources. The CODM uses revenue streams to evaluate product pricing and significant expenses to assess performance and evaluate return on assets. The CODM uses consolidated net income to benchmark the Company against its competitors. The benchmarking analysis coupled with monitoring of budget to actual results are used in assessment of performance and in establishing compensation. Loans, investments, and deposits provide the revenues in the banking operation. Interest expense, provision for credit losses, and payroll provide the significant expenses in the banking operation. All operations are domestic. See Note 14 for disclosures related to the reportable segment. Employee Benefit Plans The Company has a noncontributory pension plan that covered all eligible employees up until September 30, 2007 , at which time th

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 1b. Authoritative Accounting Guidance Adoption of New Accounting Standards in 2025 In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023 - 09, Income Taxes (Topic 740 ): Improvements to Income Tax Disclosures. These amendments require that public business entities on an annual basis ( 1 ) disclose specific categories in the rate reconciliation and ( 2 ) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5% of the amount computed by multiplying pretax income (or loss) by the applicable statutory income tax rate). The amendments require that all entities disclose on an annual basis the following information about income taxes paid: 1 ) The amount of income taxes paid (net of refunds received) disaggregated by federal (national), state, and foreign taxes. 2 ) The amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5% of total income taxes paid (net of refunds received). The amendments also require that all entities disclose the following information: 1 ) Income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign and 2 ) Income tax expense (or benefit) from continuing operations disaggregated by federal (national), state, and foreign. The Company adopted ASU 2023 - 09 on January 1, 2025. Newly Issued, But Not Yet Effective Accounting Standards In November 2024, the FASB issued Accounting Standards Update 2024 - 03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220 - 40 )" ("ASU 2024 - 03" ). ASU 2024 - 03 requires public entities to provide disaggregated disclosures, in the notes to the financial statements, of certain catego

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 2. Business Combination On June 1, 2025 ( the "Acquisition Date"), the Company completed the acquisition of The First of Long Island Corporation ("FLIC"), the parent company for the First National Bank of Long Island ("FNBLI"), in accordance with the definitive Agreement and Plan of Merger dated as of September 4, 2024 ( the "Merger Agreement"). Pursuant to the Merger Agreement, on the Acquisition Date, FLIC merged with and into the Company, with the Company continuing as the surviving corporation, and FNBLI merged with and into the Bank, with the Bank as the surviving bank (collectively, the "merger"). As part of this merger, the Company acquired 36 branch offices located in Nassau and Suffolk Counties of Long Island, and the boroughs of New York City. In connection with the completion of the merger, former FLIC shareholders received 0.5175 shares of the Company's common stock for each share of FLIC common stock they held. The value of the total transaction consider

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