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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549  

FORM8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
 
Date of report (Date of earliest event reported): January 24, 2025  
 
LAKELAND FINANCIAL CORPORATION
(Exact name of Registrant as specified in its charter) 
Indiana 0-11487 35-1559596
(State or other jurisdiction
of incorporation)		 (Commission
File Number)		 (IRS Employer
Identification No.)
 
202 East Center Street,
Warsaw,Indiana46580
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (574) 267-6144
 
(Former name or former address if changed since last report.)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, no par value LKFN NASDAQ
 
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (s230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (s240.12b-2 of this chapter).



 
Emerging growth company  ☐
 
If an emerging growth company, indicate by check mark if the Registrant has elected not to use extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨



Item 2.02. Results of Operations and Financial Condition
 
On January 24, 2025, Lakeland Financial Corporation (the “Company”) issued a press release announcing its earnings for the three and twelve months ended December 31, 2024. The press release is furnished herewith as Exhibit 99.1.
 
The disclosure in this Item 2.02 and the related exhibit under Item 9.01 are being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The disclosure in this Item 2.02 and the related exhibit under Item 9.01 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
 
Item 9.01. Financial Statements and Exhibits
 
(d)Exhibits

 



SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
LAKELAND FINANCIAL CORPORATION
 
Dated:  January 24, 2025
By:/s/ Lisa M. O’Neill
  Lisa M. O’Neill
  Executive Vice President
  and Chief Financial Officer

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Exhibit 99.1

NEWS FROM LAKELAND FINANCIAL CORPORATION
FOR IMMEDIATE RELEASE
 
Contact
Lisa M. O’Neill
Executive Vice President and Chief Financial Officer
(574) 267-9125
lisa.oneill@lakecitybank.com
 
Lakeland Financial Reports Annual Net Income of $93.5 million, Organic Average Loan Growth of 5% and Average Deposit Growth of 4%
 
Warsaw, Indiana (January 24, 2025) – Lakeland Financial Corporation (Nasdaq Global Select/LKFN), parent company of Lake City Bank, today reported net income of $93.5 million for the year ended December 31, 2024, versus $93.8 million for the year ended December 31, 2023. Diluted earnings per share were $3.63 for the twelve months ended December 31, 2024, versus $3.65 for 2023.

Net income was $24.2 million for the three months ended December 31, 2024, a decrease of $5.4 million, or 18%, compared with net income of $29.6 million for the three months ended December 31, 2023. Diluted earnings per share of $0.94 for the fourth quarter of 2024 decreased by 19% from $1.16 for the fourth quarter of 2023. On a linked quarter basis, net income increased 4%, or $852,000, from third quarter 2024 net income of $23.3 million. Linked quarter diluted earnings per share improved by 3% from $0.91 for the third quarter of 2024.

Pretax pre-provision earnings, which is a non-GAAP measure, were $128.4 million for the twelve months ended December 31, 2024, an increase of $12.3 million, or 11%, compared to $116.2 million for the twelve months ended December 31, 2023. Pretax pre-provision earnings were $32.9 million for the three months ended December 31, 2024, a decrease of $3.4 million, or 9%, compared to $36.4 million for the three months ended December 31, 2023. Pretax pre-provision earnings increased by $2.1 million, or 7%, compared to $30.8 million on a linked quarter basis.

“2024 continued a long and consistent trend of organic growth in our balance sheet. We successfully expanded both our loan and deposit franchises during the year,” stated David M. Findlay, Chairman and CEO. “We are particularly pleased with the 9-basis point expansion of our net interest margin on a linked quarter basis as we effectively managed the balance sheet throughout the year.”

Quarterly Financial Performance
 
Fourth Quarter 2024 versus Fourth Quarter 2023 highlights:

•Tangible book value per share grew by $1.25, or 5%, to $26.47
•Total risk-based capital ratio improved to 15.90%, compared to 15.47%
•Tangible capital ratio improved to 10.19%, compared to 9.91%
•Average loans grew by $206.9 million, or 4%, to $5.09 billion
•Core deposit growth of $274.3 million, or 5%, to $5.9 billion
•Average equity increased by $121.1 million, or 21%
•Return on average equity of 13.87%, compared to 20.52%
•Return on average assets of 1.42%, compared to 1.80%
•Net interest margin improved to 3.25% versus 3.23%
•Net interest income increased by $3.1 million, or 6%
•Noninterest expense increased by $1.2 million, or 4%
•Provision expense of $3.7 million, compared to $300,000
•Net charge offs of $1.4 million versus $433,000
•Watch list loans as a percentage of total loans increased to 4.13% from 3.72%

Fourth Quarter 2024 versus Third Quarter 2024 highlights:
 
•Total risk-based capital ratio improved to 15.90% from 15.75%
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•Average equity growth of $23.6 million, or 4%
•Average loans grew by $22.3 million, or less than 1%, to $5.09 billion
•Core deposits increased by $118.6 million, or 2%, to $5.8 billion
•Net interest margin improved 9 basis points to 3.25% versus 3.16%
•Return on average equity of 13.87%, compared to 13.85%
•Return on average assets of 1.42%, compared to 1.39%
•Noninterest income decreased by $41,000, or less than 1%
•Noninterest expense increased by $260,000, or 1%
•Provision expense of $3.7 million, compared to $3.1 million
•Individually analyzed and watch list loans declined by $56.4 million, or 21%
•Watch list loans as a percentage of total loans improved to 4.13% from 5.27%

Capital Strength

The company’s total capital as a percentage of risk-weighted assets improved to 15.90% at December 31, 2024, compared to 15.47% at December 31, 2023 and 15.75% at September 30, 2024. These capital levels significantly exceeded the 10.00% regulatory threshold required to be characterized as “well capitalized” and reflect the company's robust capital base.

The company’s tangible common equity to tangible assets ratio, which is a non-GAAP financial measure, improved to 10.19% at December 31, 2024, compared to 9.91% at December 31, 2023. The tangible common equity ratio contracted from 10.47% at September 30, 2024. Unrealized losses from available-for-sale investment securities were $191.1 million at December 31, 2024, compared to $174.6 million at December 31, 2023 and $154.5 million at September 30, 2024. Excluding the impact of accumulated other comprehensive income (loss) on tangible common equity and tangible assets, the company’s ratio of adjusted tangible common equity to adjusted tangible assets, a non-GAAP financial measure, improved to 12.37% at December 31, 2024, compared to 11.99% at December 31, 2023 and 12.29% at September 30, 2024.

As announced on January 14, 2025, the board of directors approved a cash dividend for the fourth quarter of $0.50 per share, payable on February 5, 2025, to shareholders of record as of January 25, 2025. The fourth quarter dividend per share represents a 4% increase from the $0.48 dividend per share paid for the fourth quarter of 2023.

“The continued growth in our capital base supports the increase in our dividend rate paid to shareholders and contributes to the growth in total return for shareholders. The compounded annual growth rate for our dividend is 15% since 2012,” stated Kristin L. Pruitt, President.

Loan Portfolio

Average total loans for the twelve months ended December 31, 2024 were $5.04 billion, an increase of $225.7 million, or 5%, from $4.81 billion for the twelve months ended December 31, 2023. Average total loans of $5.09 billion in the fourth quarter of 2024, increased $206.9 million, or 4%, from $4.88 billion for the fourth quarter of 2023, and increased $22.3 million, or less than 1%, from $5.06 billion for the third quarter of 2024.

“Loan growth in 2024 benefited from healthy increases in both our commercial and consumer lending activities,” noted Findlay. “We were pleased to report 8% growth in consumer loans, 6% growth in CRE and multi-family loans, and 2% growth in commercial and industrial loans for 2024. Our Indiana markets continue to benefit from expanding economic activity stimulated by the pro-business operating environment. We continue to be focused on active business development efforts in every market and we are looking forward to continued organic growth in 2025.”

Total loans, net of deferred loan fees, increased by $200.6 million, or 4%, from $4.92 billion as of December 31, 2023 to $5.12 billion as of December 31, 2024. The increase in loans occurred across much of the portfolio with our commercial real estate and multi-family residential loan portfolio growing by $155.0 million, or 6%, our commercial and industrial loan portfolio growing by $30.1 million, or 2%, and our consumer 1-4 family mortgage loans portfolio growing by $34.0 million, or 7%. These increases were offset by a decrease to other commercial loans of $25.1 million, or 21%. On a linked quarter basis, total loans, net of deferred loan fees, increased by $35.7 million, or 1%, from $5.08 billion at September 30, 2024. The linked quarter increase was primarily a result of growth in total commercial real estate and multi-family residential loans of $42.7 million, or 2%, and growth in total agri-business and agricultural loans of $29.0 million, or 8%. Offsetting these increases was a decrease in total commercial and industrial loans of $42.0 million, or 3%.

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Commercial loan originations for the fourth quarter included approximately $390.0 million in loan originations, offset by approximately $359.0 million in commercial loan pay downs. Line of credit usage increased to 41% as of December 31, 2024, compared to 39% at December 31, 2023 and was unchanged from 41% as of September 30, 2024. Total available lines of credit contracted by $238.0 million, or 5%, as compared to a year ago, and line usage decreased by $2.0 million, or less than 1%, over that period. The company has limited exposure to commercial office space borrowers, all of which are in the bank’s Indiana markets. Loans totaling $101.7 million for this sector represented 2% of total loans at December 31, 2024, a decrease of $899,000, or 1%, from September 30, 2024. Commercial real estate loans secured by multi-family residential properties and secured by non-farm non-residential properties were approximately 213% of total risk-based capital at December 31, 2024.

Diversified Deposit Base

The bank's diversified deposit base has grown on a year over year basis and on a linked quarter basis.

DEPOSIT DETAIL
(unaudited, in thousands)
December 31, 2024September 30, 2024December 31, 2023
Retail$1,780,726 30.2 %$1,709,899 29.3 %$1,794,958 31.4 %
Commercial2,269,049 38.4 2,304,041 39.5 2,227,147 38.9 
Public funds1,809,631 30.7 1,726,869 29.6 1,563,015 27.3 
Core deposits5,859,406 99.3 5,740,809 98.4 5,585,120 97.6 
Brokered deposits41,560 0.7 96,504 1.6 135,405 2.4 
Total$5,900,966 100.0 %$5,837,313 100.0 %$5,720,525 100.0 %

Total deposits increased $180.4 million, or 3%, from $5.72 billion as of December 31, 2023 to $5.90 billion as of December 31, 2024. The increase in total deposits was driven by an increase in core deposits (which excludes brokered deposits) of $274.3 million, or 5%. Total core deposits at December 31, 2024 were $5.86 billion and represented 99% of total deposits, as compared to $5.59 billion and 98% of total deposits at December 31, 2023. Brokered deposits were $41.6 million, or 1% of total deposits, at December 31, 2024, compared to $135.4 million, or 2% of total deposits, at December 31, 2023.

The increase in core deposits since December 31, 2023 reflects growth in commercial deposits and public funds deposits. Public funds deposits grew annually by $246.6 million, or 16%, to $1.81 billion. Commercial deposits grew annually by $41.9 million, or 2%, to $2.27 billion. Retail deposits contracted annually by $14.2 million, or 1%, to $1.78 billion. The increase in public funds deposits drove the change in the composition of core deposits as public funds deposits as a percentage of total deposits increased to 31%, from 27%. Commercial and retail deposits as a percentage of total deposits contracted to 38%, from 39%, and to 30%, from 31%, respectively. Growth in public funds was positively impacted by the addition of a new public funds customers in the Lake City Bank footprint which included the addition of their operating accounts.

On a linked quarter basis, total deposits increased $63.7 million, or 1%, from $5.84 billion at September 30, 2024 to $5.90 billion at December 31, 2024. Core deposits increased by $118.6 million, or 2%, while brokered deposits decreased by $54.9 million, or 57%. Linked quarter growth in core deposits resulted primarily from an increase in public funds deposits of $82.8 million, or 5%, and growth in retail deposits of $70.8 million, or 4%. Offsetting these increases was a decrease in commercial deposits of $35.0 million, or 2%.

“Core deposit growth was steady throughout 2024 and accounts for 99% of the funding sources for Lake City Bank,” commented Findlay. “We are pleased that our growth in core deposits came from every region of the bank. We continue to successfully fund the loan growth with in-market stable and diversified deposit growth. We continue to gain market share in our more mature Northern Indiana markets and implemented strategies to enhance growth in the Indianapolis market through data-driven marketing and business development efforts.”

Average total deposits were $6.01 billion for the fourth quarter of 2024, an increase of $208.5 million, or 4%, from $5.80 billion for the fourth quarter of 2023. Average interest-bearing deposits drove the increase in average total deposits and increased by $301.1 million, or 7%. Contributing to the overall growth of interest-bearing deposits was an increase to average interest-bearing checking accounts of $431.9 million, or 14%. Offsetting this increase was a reduction in average time deposits of $98.9 million, or 9%, and a decrease to average savings deposits of $31.9 million, or 10%. Average noninterest-bearing demand deposits decreased by $92.5 million, or 7%.
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On a linked quarter basis, average total deposits increased by $130.9 million, or 2%, from $5.88 billion for the third quarter of 2024 to $6.01 billion for the fourth quarter of 2024. Average interest-bearing deposits drove the increase to total average deposits, which increased by $93.2 million, or 2%. An increase to interest bearing checking accounts of $209.6 million, or 6%, drove the increase to average interest-bearing deposits on a linked quarter basis. Offsetting this increase was a decrease to total average time deposits of $111.1 million, or 10%. Average noninterest-bearing demand deposits increased by $37.7 million, or 3%.

Checking account trends as of December 31, 2024 compared to December 31, 2023, include growth of $310.5 million, or 24%, in aggregate public fund checking account balances, growth of $24.5 million, or 1%, in aggregate commercial checking account balances, and expansion of $34.4 million, or 4%, in aggregate retail checking account balances. The number of accounts has also grown for all three segments, with growth of 7% for public funds accounts, 2% for commercial accounts and 1% for retail accounts during 2024.

Deposits not covered by FDIC deposit insurance as a percentage of total deposits were 62% as of December 31, 2024, compared to 61% at September 30, 2024, and 57% at December 31, 2023, reflecting the growth in public fund deposits over the period. Deposits not covered by FDIC deposit insurance or the Indiana Public Deposit Insurance Fund (which insures public funds deposits in Indiana), were 32% of total deposits as of December 31, 2024, compared to 32% at September 30, 2024, and 31% as of December 31, 2023. As of December 31, 2024, 98% of deposit accounts had deposit balances less than $250,000.

Net Interest Margin

Net interest margin was 3.25% for the fourth quarter of 2024, representing a 2 basis point increase from 3.23% for the fourth quarter of 2023. Earning assets yields decreased by 15 basis points to 5.81% for the fourth quarter of 2024 from 5.96% for the fourth quarter of 2023. The decrease in earning asset yields was offset by a decrease in the company's funding costs of 17 basis points as interest expense as a percentage of average earning assets decreased to 2.56% for the fourth quarter of 2024, compared to 2.73% for the fourth quarter of 2023.

Linked quarter net interest margin expanded by 9 basis point to 3.25% for the fourth quarter of 2024, compared to 3.16% for the third quarter of 2024. Average earning asset yields decreased by 23 basis points from 6.04% during the third quarter of 2024 to 5.81% during the fourth quarter of 2024 and were offset by a 32 basis point decrease in interest expense as a percentage of average earning assets from 2.88% to 2.56%. The cumulative 100 basis point decline in the Federal Funds Rate during 2024, drove the reduction in funding costs that provided for the net interest margin expansion through deposit repricing. Notably, the deposit mix shift from noninterest bearing deposits to interest bearing deposits experienced by the company during the monetary tightening cycle of March 2022 through September 2024 has stabilized with noninterest bearing deposits representing 22% of total deposits at December 31, 2024, compared to 24% at December 31, 2023 and 22% at September 30, 2024.

“Our thoughtful and strategic balance sheet management strategies led to healthy net interest margin expansion of 9 basis points during the fourth quarter,” noted Lisa M. O’Neill, Executive Vice-President and Chief Financial Officer. “Net interest margin expansion resulted from reduced deposit costs that outpaced loan repricing due to falling short term rates. Our public fund balances are largely tied to the effective federal funds rate, and we also continue to benefit from fixed rate loan repricing to the higher interest rate environment.”

The loan beta for the current rate-easing cycle is 25% compared to the deposit beta of 31%. The cumulative loan beta, which measures the sensitivity of a bank's average loan yield to changes in short-term interest rates, was 56% for the recent rate-tightening cycle. The cumulative deposit beta, which measures the sensitivity of a bank's deposit cost to changes in short-term interest rates, was 54% for the recent rate-tightening cycle.

Liquidity Overview

The bank has robust liquidity resources. These resources include secured borrowings available from the Federal Home Loan Bank and the Federal Reserve Bank Discount Window. In addition, the bank has unsecured borrowing capacity through long established relationships within the brokered deposits markets, federal funds lines from correspondent bank partners, and Insured Cash Sweep (ICS) one-way buy funds available from the Intrafi network. As of December 31, 2024, the company had access to an aggregate of $3.7 billion in liquidity from these sources, compared to $3.4 billion at December 31, 2023 and $3.7 billion at September 30, 2024. Utilization from these sources totaled $41.6 million at December 31, 2024, compared to $185.4 million at December 31, 2023 and $96.5 million at September 30, 2024. Core deposits have historically represented, and currently represent, the primary funding resource of the bank at 99% of total deposits and purchased funds.
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Investment Portfolio Overview

Total investment securities were $1.12 billion at December 31, 2024, reflecting a decrease of $58.7 million, or 5%, as compared to $1.18 billion at December 31, 2023. On a linked quarter basis, investment securities decreased $24.8 million, or 2%, due primarily to a decline in the fair market value of available-for-sale securities of $36.6 million, portfolio cash flows of $15.1 million and partially offset by investment security purchases of $30.0 million. Investment securities represented 17% of total assets on December 31, 2024, compared to 18% at December 31, 2023 and 17% at September 30, 2024. The ratio of investment securities as a percentage of total assets remains elevated over historical levels of approximately 12% to 14%. The company expects the investment securities portfolio as a percentage of assets to continue to decrease over time as the proceeds from pay downs, sales and maturities are used to fund loan growth and for general liquidity purposes. Tax equivalent adjusted effective duration for the investment portfolio was 6.0 years at December 31, 2024, compared to 6.5 years and 6.3 years at December 31, 2023 and September 30, 2024, respectively. Tax equivalent adjusted effective duration of the investment portfolio remains elevated as compared to 4.0 years at December 31, 2019 prior to the deployment of excess liquidity to the investment portfolio and the impact of the higher interest rate environment. The company anticipates receiving principal and interest cash flows of approximately $104.2 million during 2025 from the investment securities portfolio and plans to use that liquidity to fund loan growth and to fund new investment securities purchases.

Net interest income decreased by $356,000, or less than 1%, for the twelve months ended December 31, 2024, as compared to the twelve months ended December 31, 2023. Deposit interest expense increased by $35.0 million. Offsetting the increase in deposit interest expense was an increase in loan interest income of $29.8 million and a reduction in borrowings interest expense of $4.7 million. Net interest income was $51.7 million for the fourth quarter of 2024, representing an increase of $3.1 million, or 6%, as compared to the fourth quarter of 2023. Net interest income for the fourth quarter of 2024 benefited from an increase in loan interest income of $1.9 million and a reduction in interest expense of $667,000 compared to the prior year quarter. On a linked quarter basis, net interest income increased $2.4 million, or 5%, from $49.3 million for the third quarter of 2024. On a linked quarter basis, the increase to net interest income was driven by a $4.1 million reduction in interest expense and a $1.1 million increase in income from short-term investments. Offsetting the reduction in interest expense was a reduction in loan interest income of $2.9 million.
On a full year basis, revenue increased by $6.6 million, or 3%, to $253.5 million as compared to $246.9 million for 2023. Revenue was $63.6 million for the fourth quarter 2024 representing a decrease of $2.2 million, or 3%, as compared to the fourth quarter of 2023. On a linked quarter basis, revenue increased by $2.4 million, or 4%, from $61.2 million in the third quarter of 2024.
Asset Quality

Provision expense was $16.8 million for the year ended December 31, 2024, an increase of $10.9 million, or 186%, as compared to $5.9 million during 2023. The elevated provision recorded during 2024 as compared to the prior year was primarily driven by an increase in specific allocations from the downgrade of a $43.3 million credit to an industrial company in Northern Indiana. The relationship was placed on nonperforming status in conjunction with the downgrade, which occurred during the second quarter of 2024. Additional specific allocations of $5.5 million were reserved for this credit during the fourth quarter of 2024. The company recorded a provision expense of $3.7 million in the fourth quarter of 2024, compared to provision expense of $300,000 in the fourth quarter of 2023. On a linked quarter basis, provision expense increased by $632,000 from $3.1 million for the third quarter of 2024, or 21%.

The allowance for credit loss reserve to total loans was 1.68% at December 31, 2024, up from 1.46% at December 31, 2023, and 1.65% at September 30, 2024. Net charge offs were $2.8 million for the full year 2024 compared to $6.5 million for 2023. Net charge offs to total loans were 0.05% for 2024 compared to 0.13% for 2023. Net charge offs in the fourth quarter of 2024 were $1.4 million compared to $433,000 in the fourth quarter of 2023 and $143,000 during the linked third quarter of 2024. Annualized net charge offs to average loans were 0.11% for the fourth quarter of 2024, compared to 0.04% for the fourth quarter of 2023, and 0.01% for the linked third quarter of 2024.

Nonperforming assets increased $40.8 million, or 253%, to $56.9 million as of December 31, 2024, versus $16.1 million as of December 31, 2023. On a linked quarter basis, nonperforming assets decreased $1.2 million, or 2%, compared to $58.1 million as of September 30, 2024. The ratio of nonperforming assets to total assets at December 31, 2024 increased to 0.85% from 0.25% at December 31, 2023 and decreased from 0.87% at September 30, 2024. The full-year increase in nonperforming assets was primarily driven by the industrial borrower relationship referenced above.
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Total individually analyzed and watch list loans increased by $28.1 million, or 15%, to $211.1 million as of December 31, 2024, versus $183.1 million as of December 31, 2023. On a linked quarter basis, total individually analyzed and watch list loans decreased by $56.4 million, or 21%, from $267.6 million at September 30, 2024. Watch list loans as a percentage of total loans increased by 41 basis points to 4.13% at December 31, 2024, compared to 3.72% at December 31, 2023, and decreased by 114 basis points from 5.27% at September 30, 2024. The linked quarter decrease in total individually analyzed and watch list loans was primarily driven by the removal of six relationships from the watch list with an aggregate balance of $63.7 million, offset by the addition of four downgraded credits with an aggregated balance of $8.4 million. Approximately $45.5 million of the watch list removals were attributable to credit upgrades, with the remaining $18.2 million in removals attributable to payoffs.

“We are encouraged by the $56 million decrease in watch list credits during the quarter and are cautiously optimistic following our fourth quarter, semi-annual portfolio reviews meetings during which we review every commercial banker’s portfolio,” stated Findlay. “Economic conditions in all of our markets remain stable and we continue to actively manage our loan portfolio challenges.”

Noninterest Income

Noninterest income increased by $7.0 million, or 14%, to $56.8 million for the twelve months ended December 31, 2024, compared to $49.9 million for the prior year. The increase in noninterest income for the twelve months ended December 31, 2024 was primarily driven by the net gain on sale of Visa shares of $9.0 million. Contributing further to the increase in noninterest income was an increase to wealth and advisory fees of $1.4 million, or 15%, driven by growth in customers and favorable market performance. Bank owned life insurance income increased $1.1 million, or 34%, due to favorable market performance of the company's variable bank owned life insurance policies. Offsetting these increases was a $4.5 million, or 49%, decrease to other income. Other income was elevated during the twelve months ended December 31, 2023 from insurance and loss recoveries of $6.3 million that were related to the 2023 wire fraud loss. Offsetting the impact of these recoveries was increased investment income from the company's limited partnership investments and the receipt of an additional $1.0 million in recoveries from the wire fraud loss. Adjusted core noninterest income, a non-GAAP financial measure that excludes the effects of certain non-routine operating events, was $46.8 million for the twelve months ended December 31, 2024, an increase of $3.3 million, or 8%, compared to $43.6 million for twelve months ended December 31, 2023.

Findlay added, “It is very gratifying to report strong growth in core noninterest income for 2024. Our fee-based lines of business made significant contributions to revenue growth during the year. Notably, Wealth Advisory fees grew by 15% and treasury management fees grew by 5%. As we move into 2025, our teams continue to be focused on driving continued growth in these business lines.”

The company’s noninterest income decreased $5.3 million, or 31%, to $11.9 million for the fourth quarter of 2024, compared to $17.2 million for the fourth quarter of 2023. Wealth advisory fees increased $388,000, or 17%, and bank owned life insurance increased $476,000, or 64%. Other income decreased $6.5 million, or 89%. Other income was elevated during the fourth quarter of 2023 primarily due to insurance and loss recoveries of $6.3 million related to the wire fraud loss. Adjusted core noninterest income was $11.9 million for the fourth quarter of 2024, an increase of $968,000, or 9%, compared to $10.9 million for the fourth quarter of 2023.

On a linked quarter basis, noninterest income for the fourth quarter of 2024 decreased by $41,000, or less than 1%, from $11.9 million during the third quarter of 2024. The linked quarter decrease was driven by a decrease to other income of $261,000, or 25%, and was offset by an increase to bank owned life insurance income $148,000, or 14%.














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Noninterest Expense

Noninterest expense decreased by $5.6 million, or 4%, from $130.7 million to $125.1 million for the twelve months ended December 31, 2023 and 2024, respectively. Noninterest expense during 2023 was elevated as compared to 2024 due to the wire fraud loss, which added a net $16.7 million to noninterest expense. Offsetting this impact on noninterest expense was a $7.6 million, or 13%, increase in salaries and employees benefits during the full year 2024. The increase to salaries and benefits expense resulted primarily from increases to salaries and wages of $3.2 million, performance-based incentive compensation of $2.3 million, health insurance expense of $918,000, and variable deferred compensation of $950,000, which relates to the company's variable bank owned life insurance. Other expense increased $2.6 million, or 24%, primarily due to an accrued legal expense of $4.5 million. Data processing fees and supplies increased by $1.2 million, or 8%, from the continued investment in customer-facing and operational technology solutions. Adjusted core noninterest expense, a non-GAAP financial measure that excludes the effects of certain non-routine operating events, was $120.5 million for the twelve months ended December 31, 2024, an increase of $6.5 million, or 6%, compared to $114.0 million for the twelve months ended December 31, 2023.

Noninterest expense increased $1.2 million, or 4%, to $30.7 million for the fourth quarter of 2024, compared to $29.4 million during the fourth quarter of 2023. Driving the fourth quarter 2024 increase to noninterest expense was an increase to salaries and benefits expense of $1.5 million, or 10%, which was primarily attributable to increased salary expense of $825,000, deferred compensation of $414,000 and increased health insurance of $222,000. Other expense decreased by $595,000, or 20%, from lower legal accruals. Adjusted core noninterest expense increased by $1.7 million, or 6%, from $29.0 million during the fourth quarter of 2023.

On a linked quarter basis, noninterest expense increased by $260,000, or 1%, from $30.4 million during the third quarter of 2024. Driving the increase in noninterest expense was an increase in salaries and employee benefits of $785,000, or 5%, primarily due to performance-based incentive compensation. Corporate and business development expense decreased by $419,000, or 31%, which was driven by a reduction in advertising expense during the quarter. Other expense decreased by $132,000, or 5%.

The company's efficiency ratio for the twelve months ended December 31, 2024 was 49.3% compared to 52.9% for the twelve months ended December 31, 2023. The company's adjusted core efficiency ratio, a non-GAAP financial measure that excludes the impact of certain non-routine operating events, was 49.5% for the twelve months ended December 31, 2024 as compared to 47.4% for the twelve months ended December 31, 2023.

The company’s efficiency ratio was 48.2% for the fourth quarter of 2024, compared to 44.7% for the fourth quarter of 2023 and 49.7% for the linked third quarter of 2024. The company's adjusted core efficiency ratio was 48.7% for the fourth quarter of 2023 and unchanged when compared to the company's efficiency ratio for the third and fourth quarters of 2024.

Information regarding Lakeland Financial Corporation may be accessed on the home page of its subsidiary, Lake City Bank, at lakecitybank.com. The company’s common stock is traded on the Nasdaq Global Select Market under “LKFN.” Lake City Bank, a $6.7 billion bank headquartered in Warsaw, Indiana, was founded in 1872 and serves Central and Northern Indiana communities with 54 branch offices and a robust digital banking platform. Lake City Bank's community banking model prioritizes building in-market long-term customer relationships while delivering technology-forward solutions for retail and commercial clients.












 
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This document contains, and future oral and written statements of the company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “continue,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. The company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain and, accordingly, the reader is cautioned not to place undue reliance on any forward-looking statements made by the company. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the company undertakes no obligation to update any statement in light of new information or future events. Numerous factors could cause the company’s actual results to differ from those reflected in forward-looking statements, including the effects of economic, business and market conditions and changes, particularly in our Indiana market area, including prevailing interest rates and the rate of inflation; governmental monetary and fiscal policies; the risks of changes in interest rates on the levels, composition and costs of deposits, loan demand and the values and liquidity of loan collateral, securities and other interest sensitive assets and liabilities; and changes in borrowers’ credit risks and payment behaviors, as well as those identified in the company’s filings with the Securities and Exchange Commission, including the company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
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LAKELAND FINANCIAL CORPORATION
FOURTH QUARTER 2024 FINANCIAL HIGHLIGHTS
 Three Months EndedTwelve Months Ended
(Unaudited – Dollars in thousands, except per share data)December 31,September 30,December 31,December 31,December 31,
END OF PERIOD BALANCES20242024202320242023
Assets$6,678,374 $6,645,371 $6,524,029 $6,678,374 $6,524,029 
Investments1,122,994 1,147,806 1,181,646 1,122,994 1,181,646 
Loans5,117,948 5,081,990 4,916,534 5,117,948 4,916,534 
Allowance for Credit Losses85,960 83,627 71,972 85,960 71,972 
Deposits5,900,966 5,837,313 5,720,525 5,900,966 5,720,525 
Brokered Deposits41,560 96,504 135,405 41,560 135,405 
Core Deposits (1)5,859,406 5,740,809 5,585,120 5,859,406 5,585,120 
Total Equity683,911 699,181 649,793 683,911 649,793 
Goodwill Net of Deferred Tax Assets3,803 3,803 3,803 3,803 3,803 
Tangible Common Equity (2)680,108 695,378 645,990 680,108 645,990 
Adjusted Tangible Common
Equity (2)		846,040 832,813 800,450 846,040 800,450 
AVERAGE BALANCES
Total Assets$6,795,596 $6,656,464 $6,514,430 $6,662,718 $6,464,980 
Earning Assets6,470,920 6,329,287 6,145,937 6,328,498 6,114,225 
Investments1,134,011 1,128,705 1,107,862 1,134,979 1,184,659 
Loans5,086,614 5,064,348 4,879,695 5,039,406 4,813,678 
Total Deposits6,011,122 5,880,177 5,802,592 5,836,025 5,604,228 
Interest Bearing Deposits4,729,201 4,635,993 4,428,140 4,578,219 4,128,922 
Interest Bearing Liabilities4,729,206 4,649,745 4,441,425 4,644,553 4,295,743 
Total Equity693,744 670,160 572,653 662,087 588,667 
INCOME STATEMENT DATA
Net Interest Income$51,694 $49,273 $48,599 $196,679 $197,035 
Net Interest Income-Fully Tax Equivalent52,804 50,383 49,914 201,363 202,347 
Provision for Credit Losses3,691 3,059 300 16,750 5,850 
Noninterest Income11,876 11,917 17,208 56,844 49,858 
Noninterest Expense30,653 30,393 29,445 125,084 130,710 
Net Income24,190 23,338 29,626 93,478 93,767 
Pretax Pre-Provision Earnings (2)32,917 30,797 36,362 128,439 116,183 
PER SHARE DATA
Basic Net Income Per Common Share$0.94 $0.91 $1.16 $3.64 $3.67 
Diluted Net Income Per
Common Share		0.94 0.91 1.16 3.63 3.65 
Cash Dividends Declared Per Common Share0.48 0.48 0.46 1.92 1.84 
Dividend Payout51.06 %52.75 %39.66 %52.89 %50.41 %
Book Value Per Common Share (equity per share issued)$26.62 $27.22 $25.37 $26.62 $25.37 
Tangible Book Value Per Common Share (2)26.47 27.07 25.22 26.47 25.22 
Market Value – High$78.61 $72.25 $67.88 $78.61 $77.07 
Market Value – Low61.10 57.45 45.59 57.45 43.05 
Three Months EndedTwelve Months Ended
(Unaudited – Dollars in thousands, except per share data)December 31,September 30,December 31,December 31,December 31,
PER SHARE DATA (continued)20242024202320242023
Basic Weighted Average Common Shares Outstanding25,686,276 25,684,407 25,614,420 25,676,543 25,604,751 
Diluted Weighted Average Common Shares Outstanding25,792,460 25,767,739 25,732,870 25,769,018 25,723,165 
KEY RATIOS
Return on Average Assets1.42 %1.39 %1.80 %1.40 %1.45 %
Return on Average Total Equity13.87 13.85 20.52 14.12 15.93 
Average Equity to Average Assets10.21 10.07 8.79 9.94 9.11 
Net Interest Margin3.25 3.16 3.23 3.18 3.31 
Efficiency  (Noninterest Expense/Net Interest Income
plus Noninterest Income)
48.22 49.67 44.74 49.34 52.94 
Loans to Deposits86.73 87.06 85.95 86.73 85.95 
Investment Securities to Total Assets16.82 17.27 18.11 16.82 18.11 
Tier 1 Leverage (3)12.15 12.18 11.82 12.15 11.82 
Tier 1 Risk-Based Capital (3)14.64 14.50 14.21 14.64 14.21 
Common Equity Tier 1 (CET1) (3)14.64 14.50 14.21 14.64 14.21 
Total Capital (3)15.90 15.75 15.47 15.90 15.47 
Tangible Capital (2)10.19 10.47 9.91 10.19 9.91 
Adjusted Tangible Capital (2)12.37 12.29 11.99 12.37 11.99 
ASSET QUALITY
Loans Past Due 30 - 89 Days$4,273 $829 $3,360 $4,273 $3,360 
Loans Past Due 90 Days or More28 95 27 28 27 
Nonaccrual Loans56,431 57,551 15,687 56,431 15,687 
Nonperforming Loans56,459 57,646 15,714 56,459 15,714 
Other Real Estate Owned284 384 384 284 384 
Other Nonperforming Assets143 21 8 143 8 
Total Nonperforming Assets56,886 58,051 16,106 56,886 16,106 
Individually Analyzed Loans78,647 77,654 16,124 78,647 16,124 
Non-Individually Analyzed Watch List Loans132,499 189,918 166,961 132,499 166,961 
Total Individually Analyzed and Watch List Loans211,146 267,572 183,085 211,146 183,085 
Gross Charge Offs1,657 231 566 3,468 7,332 
Recoveries299 88 133 706 848 
Net Charge Offs/(Recoveries)1,358 143 433 2,762 6,484 
Net Charge Offs/(Recoveries) to Average Loans0.11 %0.01 %0.04 %0.05 %0.13 %
Credit Loss Reserve to Loans1.68 1.65 1.46 1.68 1.46 
Credit Loss Reserve to Nonperforming Loans152.25 145.07 458.01 152.25 458.01 
Nonperforming Loans to Loans1.10 1.13 0.32 1.10 0.32 
Nonperforming Assets to Assets0.85 0.87 0.25 0.85 0.25 
Total Individually Analyzed and Watch List Loans to Total Loans4.13 %5.27 %3.72 %4.13 %3.72 %
Three Months EndedTwelve Months Ended
(Unaudited – Dollars in thousands, except per share data)December 31,September 30,December 31,December 31,December 31,
PER SHARE DATA (continued)20242024202320242023
OTHER DATA
Full Time Equivalent Employees643 639 619 643 619 
Offices54 54 53 54 53 
(1)Core deposits equals deposits less brokered deposits.
(2)Non-GAAP financial measure - see “Reconciliation of Non-GAAP Financial Measures”.
(3)Capital ratios for December 31, 2024 are preliminary until the Call Report is filed.

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CONSOLIDATED BALANCE SHEETS (in thousands, except share data)
December 31,
2024		December 31,
2023
(Unaudited)
ASSETS
Cash and due from banks$71,733 $70,451 
Short-term investments96,472 81,373 
Total cash and cash equivalents168,205 151,824 
Securities available-for-sale, at fair value991,426 1,051,728 
Securities held-to-maturity, at amortized cost (fair value of $113,107 and $119,215, respectively)
131,568 129,918 
Real estate mortgage loans held-for-sale1,700 1,158 
Loans, net of allowance for credit losses of $85,960 and $71,972
5,031,988 4,844,562 
Land, premises and equipment, net60,489 57,899 
Bank owned life insurance113,320 109,114 
Federal Reserve and Federal Home Loan Bank stock21,420 21,420 
Accrued interest receivable28,446 30,011 
Goodwill4,970 4,970 
Other assets124,842 121,425 
Total assets$6,678,374 $6,524,029 
LIABILITIES
Noninterest bearing deposits$1,297,456 $1,353,477 
Interest bearing deposits4,603,510 4,367,048 
Total deposits5,900,966 5,720,525 
Borrowings - Federal Home Loan Bank advances0 50,000 
Accrued interest payable15,117 20,893 
Other liabilities78,380 82,818 
Total liabilities5,994,463 5,874,236 
STOCKHOLDERS’ EQUITY
Common stock: 90,000,000 shares authorized, no par value
25,978,831 shares issued and 25,509,592 outstanding as of December 31, 2024
25,903,686 shares issued and 25,430,566 outstanding as of December 31, 2023
129,664 127,692 
Retained earnings736,412 692,760 
Accumulated other comprehensive income (loss)(166,500)(155,195)
Treasury stock, at cost (469,239 shares and 473,120 shares as of December 31, 2024 and December 31, 2023, respectively)
(15,754)(15,553)
Total stockholders’ equity683,822 649,704 
Noncontrolling interest89 89 
Total equity683,911 649,793 
Total liabilities and equity$6,678,374 $6,524,029 
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CONSOLIDATED STATEMENTS OF INCOME (unaudited - in thousands, except share and per share data)
Three Months Ended December 31,Twelve Months Ended December 31,
2024202320242023
NET INTEREST INCOME
Interest and fees on loans
Taxable$83,253 $80,631 $335,639 $304,130 
Tax exempt296 1,016 2,126 3,885 
Interest and dividends on securities
Taxable2,997 3,187 12,048 13,153 
Tax exempt3,914 4,009 15,714 16,396 
Other interest income2,910 2,099 7,631 5,703 
Total interest income93,370 90,942 373,158 343,267 
Interest on deposits41,676 42,154 172,759 137,791 
Interest on short-term borrowings0 189 3,720 8,441 
Total interest expense41,676 42,343 176,479 146,232 
NET INTEREST INCOME51,694 48,599 196,679 197,035 
Provision for credit losses3,691 300 16,750 5,850 
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES48,003 48,299 179,929 191,185 
NONINTEREST INCOME
Wealth advisory fees2,699 2,311 10,469 9,080 
Investment brokerage fees456 445 1,894 1,815 
Service charges on deposit accounts2,825 2,682 11,157 10,773 
Loan and service fees2,977 2,968 11,832 11,750 
Merchant and interchange fee income889 907 3,542 3,651 
Bank owned life insurance income1,216 740 4,210 3,133 
Interest rate swap fee income0 0 0 794 
Mortgage banking income (loss)48 (70)116 (254)
Net securities gains (losses)0 (9)(46)(25)
Net gain on Visa shares0 0 8,996 0 
Other income766 7,234 4,674 9,141 
Total noninterest income11,876 17,208 56,844 49,858 
NONINTEREST EXPENSE
Salaries and employee benefits17,261 15,733 66,728 59,147 
Net occupancy expense1,706 1,486 6,865 6,360 
Equipment costs1,405 1,443 5,612 5,632 
Data processing fees and supplies3,742 3,698 15,161 14,003 
Corporate and business development950 877 4,965 4,807 
FDIC insurance and other regulatory fees894 894 3,465 3,363 
Professional fees2,275 2,299 8,950 8,583 
Wire fraud loss0 0 0 18,058 
Other expense2,420 3,015 13,338 10,757 
Total noninterest expense30,653 29,445 125,084 130,710 
INCOME BEFORE INCOME TAX EXPENSE29,226 36,062 111,689 110,333 
Income tax expense5,036 6,436 18,211 16,566 
NET INCOME$24,190 $29,626 $93,478 $93,767 
BASIC WEIGHTED AVERAGE COMMON SHARES25,686,276 25,614,420 25,676,543 25,604,751 
BASIC EARNINGS PER COMMON SHARE$0.94 $1.16 $3.64 $3.67 
DILUTED WEIGHTED AVERAGE COMMON SHARES25,792,460 25,732,870 25,769,018 25,723,165 
DILUTED EARNINGS PER COMMON SHARE$0.94 $1.16 $3.63 $3.65 


 
 

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LAKELAND FINANCIAL CORPORATION
LOAN DETAIL
(unaudited, in thousands)
December 31,
2024		September 30,
2024		December 31,
2023
Commercial and industrial loans:      
Working capital lines of credit loans$649,609 12.7 %$678,079 13.3 %$604,893 12.3 %
Non-working capital loans801,256 15.6 814,804 16.0 815,871 16.6 
Total commercial and industrial loans1,450,865 28.3 1,492,883 29.3 1,420,764 28.9 
Commercial real estate and multi-family residential loans: 
Construction and land development loans567,781 11.1 729,293 14.3 634,435 12.9 
Owner occupied loans807,090 15.8 810,453 15.9 825,464 16.8 
Nonowner occupied loans872,671 17.0 766,821 15.1 724,101 14.7 
Multifamily loans344,978 6.7 243,283 4.8 253,534 5.1 
Total commercial real estate and multi-family residential loans2,592,520 50.6 2,549,850 50.1 2,437,534 49.5 
Agri-business and agricultural loans: 
Loans secured by farmland156,609 3.1 157,413 3.1 162,890 3.3 
Loans for agricultural production230,787 4.5 200,971 4.0 225,874 4.6 
Total agri-business and agricultural loans387,396 7.6 358,384 7.1 388,764 7.9 
Other commercial loans95,584 1.9 94,309 1.9 120,726 2.5 
Total commercial loans4,526,365 88.4 4,495,426 88.4 4,367,788 88.8 
Consumer 1-4 family mortgage loans: 
Closed end first mortgage loans259,286 5.1 261,462 5.1 258,103 5.2 
Open end and junior lien loans214,125 4.2 210,275 4.1 189,663 3.9 
Residential construction and land development loans16,818 0.3 14,200 0.3 8,421 0.2 
Total consumer 1-4 family mortgage loans490,229 9.6 485,937 9.5 456,187 9.3 
Other consumer loans104,041 2.0 103,547 2.1 96,022 1.9 
Total consumer loans594,270 11.6 589,484 11.6 552,209 11.2 
Subtotal5,120,635 100.0 %5,084,910 100.0 %4,919,997 100.0 %
Less:  Allowance for credit losses(85,960) (83,627)(71,972)
Net deferred loan fees(2,687) (2,920)(3,463)
Loans, net$5,031,988  $4,998,363 $4,844,562 
 

 
LAKELAND FINANCIAL CORPORATION
DEPOSITS AND BORROWINGS
(unaudited, in thousands)
 
December 31,
2024		September 30,
2024		December 31,
2023
Noninterest bearing demand deposits$1,297,456 $1,284,527 $1,353,477 
Savings and transaction accounts:  
Savings deposits276,179 276,468 301,168 
Interest bearing demand deposits3,471,455 3,273,405 3,049,059 
Time deposits:  
Deposits of $100,000 or more642,776 787,095 792,738 
Other time deposits213,100 215,818 224,083 
Total deposits$5,900,966 $5,837,313 $5,720,525 
FHLB advances and other borrowings0 30,000 50,000 
Total funding sources$5,900,966 $5,867,313 $5,770,525 
 
 
 
 

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LAKELAND FINANCIAL CORPORATION
AVERAGE BALANCE SHEET AND NET INTEREST ANALYSIS
(UNAUDITED) 
Three Months Ended December 31, 2024Three Months Ended September 30, 2024Three Months Ended December 31, 2023
(fully tax equivalent basis, dollars in thousands)Average BalanceInterest IncomeYield (1)/
Rate		Average BalanceInterest IncomeYield (1)/
Rate		Average BalanceInterest IncomeYield (1)/
Rate
Earning Assets         
Loans:         
Taxable (2)(3)$5,060,397 $83,253 6.54 %$5,037,855 $86,118 6.80 %$4,820,389 $80,631 6.64 %
Tax exempt (1)26,217 364 5.52 26,493 366 5.50 59,306 1,265 8.46 
Investments: (1)
Securities1,134,011 7,953 2.79 1,128,705 7,871 2.77 1,107,862 8,262 2.96 
Short-term investments2,765 29 4.17 2,841 35 4.90 2,610 32 4.86 
Interest bearing deposits247,530 2,881 4.63 133,393 1,738 5.18 155,770 2,067 5.26 
Total earning assets$6,470,920 $94,480 5.81 %$6,329,287 $96,128 6.04 %$6,145,937 $92,257 5.96 %
Less:  Allowance for credit losses(84,687)  (81,353)(72,165)  
Nonearning Assets      
Cash and due from banks67,994   63,744 69,563   
Premises and equipment60,325   59,493 58,436   
Other nonearning assets281,044   285,293 312,659   
Total assets$6,795,596   $6,656,464 $6,514,430   
Interest Bearing Liabilities      
Savings deposits$274,960 $43 0.06 %$280,180 $45 0.06 %$306,875 $52 0.07 %
Interest bearing checking accounts3,505,470 31,562 3.58 3,295,911 33,822 4.08 3,073,570 30,953 4.00 
Time deposits:
In denominations under $100,000214,429 1,921 3.56 215,020 1,914 3.54 220,678 1,810 3.25 
In denominations over $100,000734,342 8,150 4.42 844,882 9,775 4.60 827,017 9,339 4.48 
Miscellaneous short-term borrowings5 0 5.30 13,752 189 5.48 13,285 189 5.64 
Total interest bearing liabilities$4,729,206 $41,676 3.51 %$4,649,745 $45,745 3.91 %$4,441,425 $42,343 3.78 %
Noninterest Bearing Liabilities      
Demand deposits1,281,921   1,244,184 1,374,452   
Other liabilities90,725   92,375 125,900   
Stockholders' Equity693,744   670,160 572,653   
Total liabilities and stockholders' equity$6,795,596   $6,656,464 $6,514,430   
Interest Margin Recap      
Interest income/average earning assets 94,480 5.81 %96,128 6.04 % 92,257 5.96 %
Interest expense/average earning assets 41,676 2.56 45,745 2.88  42,343 2.73 
Net interest income and margin $52,804 3.25 %$50,383 3.16 % $49,914 3.23 %
 
(1)Tax exempt income was converted to a fully taxable equivalent basis at a 21 percent tax rate. The tax equivalent rate for tax exempt loans and tax exempt securities acquired after January 1, 1983, included the Tax Equity and Fiscal Responsibility Act of 1982 (“TEFRA”) adjustment applicable to nondeductible interest expenses. Taxable equivalent basis adjustments were $1.11 million, $1.11 million and $1.32 million in the three-month periods ended December 31, 2024, September 30, 2024, and December 31, 2023, respectively.
(2)Loan fees, which are immaterial in relation to total taxable loan interest income for the three months ended December 31, 2024, September 30, 2024, and December 31, 2023, are included as taxable loan interest income.
(3)Nonaccrual loans are included in the average balance of taxable loans.
  


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Reconciliation of Non-GAAP Financial Measures

Tangible common equity, adjusted tangible common equity, tangible assets, adjusted tangible assets, tangible book value per common share, tangible common equity to tangible assets, adjusted tangible common equity to adjusted tangible assets, and pretax pre-provision earnings are non-GAAP financial measures calculated based on GAAP amounts. Tangible common equity is calculated by excluding the balance of goodwill and other intangible assets from the calculation of equity, net of deferred tax. Tangible assets are calculated by excluding the balance of goodwill and other intangible assets from the calculation of total assets, net of deferred tax. Adjusted tangible assets and adjusted tangible common equity remove the fair market value adjustment impact of the available-for-sale investment securities portfolio in accumulated other comprehensive income (loss) ("AOCI"). Tangible book value per common share is calculated by dividing tangible common equity by the number of shares outstanding less true treasury stock. Pretax pre-provision earnings is calculated by adding net interest income to noninterest income and subtracting noninterest expense. Because not all companies use the same calculation of tangible common equity and tangible assets, this presentation may not be comparable to other similarly titled measures calculated by other companies. However, management considers these measures of the company’s value meaningful to understanding of the company’s financial information and performance.
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A reconciliation of these non-GAAP financial measures is provided below (dollars in thousands, except per share data).

 Three Months EndedTwelve Months Ended
Dec. 31, 2024Sep. 30, 2024Dec. 31, 2023Dec. 31, 2024Dec. 31, 2023
Total Equity$683,911 $699,181 $649,793 $683,911 $649,793 
Less: Goodwill(4,970)(4,970)(4,970)(4,970)(4,970)
Plus: DTA Related to Goodwill1,167 1,167 1,167 1,167 1,167 
Tangible Common Equity680,108 695,378 645,990 680,108 645,990 
Market Value Adjustment in AOCI165,932 137,435 154,460 165,932 154,460 
Adjusted Tangible Common Equity846,040 832,813 800,450 846,040 800,450 
Assets$6,678,374 $6,645,371 $6,524,029 $6,678,374 $6,524,029 
Less: Goodwill(4,970)(4,970)(4,970)(4,970)(4,970)
Plus: DTA Related to Goodwill1,167 1,167 1,167 1,167 1,167 
Tangible Assets6,674,571 6,641,568 6,520,226 6,674,571 6,520,226 
Market Value Adjustment in AOCI165,932 137,435 154,460 165,932 154,460 
Adjusted Tangible Assets6,840,503 6,779,003 6,674,686 6,840,503 6,674,686 
Ending Common Shares Issued25,689,730 25,684,916 25,614,585 25,689,730 25,614,585 
Tangible Book Value Per Common Share$26.47 $27.07 $25.22 $26.47 $25.22 
Tangible Common Equity/Tangible Assets10.19 %10.47 %9.91 %10.19 %9.91 %
Adjusted Tangible Common Equity/Adjusted Tangible Assets12.37 %12.29 %11.99 %12.37 %11.99 %
Net Interest Income$51,694 $49,273 $48,599 $196,679 $197,035 
Plus:  Noninterest Income11,876 11,917 17,208 56,844 49,858 
Minus:  Noninterest Expense(30,653)(30,393)(29,445)(125,084)(130,710)
Pretax Pre-Provision Earnings$32,917 $30,797 $36,362 $128,439 $116,183 


15

lakelandlogoa.jpg
Adjusted core noninterest income, adjusted core noninterest expense, adjusted earnings before income taxes, core operational profitability, core operational diluted earnings per common share and adjusted core efficiency ratio are non-GAAP financial measures calculated based on GAAP amounts. These adjusted amounts are calculated by excluding the impact of the net gain on Visa shares, legal accrual, and wire fraud loss and associated insurance and loss recoveries and adjustments to salaries and employee benefits expense for the periods presented below. Management considers these measures of financial performance to be meaningful to understanding the company’s core business performance for these periods.

A reconciliation of these non-GAAP financial measures is provided below (dollars in thousands, except per share data).

 Three Months EndedTwelve Months Ended
Dec. 31, 2024Sep. 30, 2024Dec. 31, 2023Dec. 31, 2024Dec. 31, 2023
Noninterest Income$11,876 $11,917 $17,208 $56,844 $49,858 
Less: Net (Gain) Loss on Visa Shares0 15 0 (8,996)0 
Less: Insurance and Loss Recoveries 0 0 (6,300)(1,000)(6,300)
Adjusted Core Noninterest Income$11,876 $11,932 $10,908 $46,848 $43,558 
Noninterest Expense$30,653 $30,393 $29,445 $125,084 $130,710 
Less: Legal Accrual0 0 0 (4,537)0 
Less: Wire Fraud Loss0 0 0 0 (18,058)
Plus: Salaries and Employee Benefits (1)0 0 (453)0 1,397 
Adjusted Core Noninterest Expense$30,653 $30,393 $28,992 $120,547 $114,049 
Earnings Before Income Taxes$29,226 $27,738 $36,062 $111,689 $110,333 
Adjusted Core Impact:
Noninterest Income0 15 (6,300)(9,996)(6,300)
Noninterest Expense0 0 453 4,537 16,661 
Total Adjusted Core Impact0 15 (5,847)(5,459)10,361 
Adjusted Earnings Before Income Taxes29,226 27,753 30,215 106,230 120,694 
Tax Effect(5,036)(4,404)(4,996)(16,853)(19,119)
Core Operational Profitability (2)$24,190 $23,349 $25,219 $89,377 $101,575 
Diluted Earnings Per Common Share$0.94 $0.91 $1.16 $3.63 $3.65 
Impact of Adjusted Core Items0.00 0.00 (0.18)(0.16)0.30 
Core Operational Diluted Earnings Per Common Share$0.94 $0.91 $0.98 $3.47 $3.95 
Adjusted Core Efficiency Ratio48.22 %49.66 %48.72 %49.49 %47.40 %

(1)In 2023, long-term, incentive-based compensation accruals were reduced as a result of the wire fraud loss and associated insurance and loss recoveries.
(2)Core operational profitability was $11,000 higher and $4.4 million lower than reported net income for the three months ended September 30, 2024 and December 31, 2023, respectively. Core operational profitability was $4.1 million lower and $7.8 million higher than reported net income for the twelve months ended December 31, 2024 and 2023, respectively.

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16

v3.24.4
Cover
Jan. 24, 2025
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jan. 24, 2025
Entity Registrant Name LAKELAND FINANCIAL CORP
Entity Incorporation, State Country Name IN
Entity File Number 0-11487
Entity Tax Identification Number 35-1559596
Entity Address, Address Line One 202 East Center Street,
Entity Address, City or Town Warsaw
Entity Address, State or Province IN
Entity Address, Postal Zip Code 46580
City Area Code 574
Local Phone Number 267-6144
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, no par value
Trading Symbol LKFN
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000721994
Amendment Flag false
Lakeland Financial (NASDAQ:LKFN)
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