Glacier Bancorp's NIM Surges 61 BPS, Acquisitions Fuel Growth

Date of Call: Jan 23, 2026

Financials Results

• Revenue: Not explicitly provided; net interest income for Q4 was $266M, up 18% from prior quarter; net interest income for 2025 was $889M, up 26% YOY.
• EPS: Diluted EPS for Q4 was $0.49 per share. Diluted EPS for 2025 was $1.99 per share, an increase of $0.31, or 18%, from the prior year.
• Gross Margin: Not applicable for a bank; net interest margin for Q4 was 3.58%, up 19 basis points from prior quarter and up 61 basis points from prior year fourth quarter.
• Operating Margin: Not explicitly calculated; net interest margin provided as 3.58% for Q4.

Guidance:

• Core non-interest expense for Q1 2026 expected to be $189-$193 million, stepping down in subsequent quarters.
• Full year 2026 core operating expense guide estimated at $766 million.
• Net interest margin expected to reach 4% in the second half of 2026.
• Loan growth for 2026 expected in the low- to mid-single digits.
• Efficiency ratio expected to improve to the mid-50% (54%-55%) range in 2026.
• Expect $2 billion+ of assets repriced in 2026, gaining 75-100 basis points.
• Expect ~$425 million of securities cash flow each quarter in 2026.
• Full-year 2026 securities cash flow yield expected in the low to mid-1% range.

Business Commentary:

Record Growth and Strategic Acquisitions:

• Glacier Bancorp reported record total assets of $32 billion for 2025, with a 12% increase from the prior quarter and a 21% increase in the loan portfolio.
• This growth was driven by strategic acquisitions, including the Bank of Idaho and Guaranty Bank & Trust, which expanded their footprint in Idaho and Texas.

Financial Performance and Margin Expansion:

• The company delivered a net income of $239 million for 2025, a 26% increase from the prior year.
• Financial results were bolstered by strong margin expansion, with a net interest margin increase of 61 basis points from the prior year's fourth quarter.

Strong Deposit Growth:

• Total deposits grew to $24.6 billion, a 12% increase from the prior quarter and a 20% increase for the year 2025.
• This was attributed to the acquisitions and the company's expanding footprint and strong market position.

Efficiency and Expense Management:

• The efficiency ratio improved to 63% by the end of 2025, down from 66.7% at the beginning of the year.
• This improvement was due to disciplined expense management and the integration of new technology, which enhanced operational efficiency.

Credit Quality and Risk Management:

• Non-Performing Assets remained low at 22 basis points of total assets, and the allowance for credit was maintained at 1.22% of total loans.
• This reflects a conservative approach to risk management and a disciplined credit culture.

Sentiment Analysis:

Overall Tone: Positive

• Management expressed being "very pleased with the performance," highlighted "transformative" growth from acquisitions, "strong financial results," "significant growth in all key metrics," "excellent quarter," "good momentum," "historically low levels" for credit quality, "strong capital position," and "very solid foundation for future growth."

Q&A:

• Question from David Feaster (Raymond James): Concerns about loan growth being slower than expected in the quarter and outlook for future growth and Guaranty contribution.
  Response: Growth is seasonally slower due to ag/construction season ends and line paydowns; 2026 expected low- to mid-single digits with potential for higher end due to strong pipeline and construction tailwinds. Guaranty is already contributing meaningfully.

• Question from David Feaster (Raymond James): Follow-up on net interest margin trajectory, confidence in reaching 4% threshold, and dependence on Fed cuts.
  Response: NIM momentum is strong and structural, not Fed-dependent; expect to hit 4% in second half of 2026.

• Question from David Feaster (Raymond James): Core expense run rate heading into new year and thoughts on investments/hiring amid market disruption.
  Response: Q1 2026 core expense guide $189-$193M, stepping down through the year; efficiency ratio improving toward mid-50s. Investment in people is selective and not expected to cause material expense increase.

• Question from Andrew Terrell (Stephens): Full-year 2026 expected expense run rate given Q1 guide and moderation afterward.
  Response: Full year 2026 core operating expense guide estimated at $766 million.

• Question from Andrew Terrell (Stephens): Origination yields, competition impact, and pace of loan/earning asset yield expansion.
  Response: New loan pricing spreads around 300 bps over index, with yields recently rising; expect north of $2 billion in assets repriced in 2026, gaining 75-100 bps.

• Question from Andrew Terrell (Stephens): Update on Guaranty's tangible book value dilution and payback period.
  Response: Tangible book value payback period remains six months as previously stated.

• Question from Kelly Motta (KBW): Clarification on expense guide upper end and factors pushing to higher vs. lower end of efficiency ratio range.
  Response: Higher expenses expected with higher revenues and talent additions; Q1 typically higher due to pay increases/taxes, then steps down.

• Question from Kelly Motta (KBW): New loan pricing trends and outlook for 2026.
  Response: New loan pricing margins are improving, starting near 3%, encouraging but early to tell if trend continues.

• Question from Kelly Motta (KBW): Cadence and blended yield of securities cash flows for 2026.
  Response: Expect ~$425 million quarterly securities cash flow with yield in low to mid-1% range.

• Question from Jeff Rulis (D.A. Davidson): Headwinds/tailwinds for loan growth in 2025 vs. 2026 and M&A outlook.
  Response: 2025 had some early-term payout headwinds; 2026 tailwinds from construction season and ag line utilization. M&A environment is good and selective.

• Question from Andrew Terrell (Stephens) - Follow-up: Repricing asset figures for 2026/2027 and FHLB balance payoff timing/cash flow use.
  Response: Repricing ~$2.5B in 2027. FHLB payoff expected mid-March 2026, funded by securities cash flow; excess cash to be redeployed into bond book.

• Question from David Feaster (Raymond James) - Follow-up: Early read on Guaranty integration and longer-term margin outlook.
  Response: Integration is seamless with minimal disruption; culture/credit fit is strong. Long-term margin expansion expected beyond 4% in 2027.

• Question from Matthew Clark (Piper Sandler): Clarification of expense guide, deposit cost uptick, cost save recognition, and charge-off details.
  Response: Expense guide is $189-$193M for Q1. Deposit cost uptick from acquisition, expected to trend down. Cost saves materialize post-conversion. Charge-offs were normal year-end cleanup, nothing unusual.

Contradiction Point 1

Net Interest Margin (NIM) Trajectory and Timing

It involves contradictory statements on the dependency of reaching a 4% NIM on Fed policy, which is a critical factor for financial forecasting and investor expectations.

How confident are you in achieving a 4% net interest margin by 2026, and how dependent is this on Fed rate cuts? - David Feaster (Raymond James)

2025Q4: NIM momentum is strong and structural, not dependent on Fed policy. - [Byron Pollan](Treasurer)

Given seven consecutive quarters of margin expansion, where do you expect margins to go? - Jeff Rulis (D.A. Davidson)

2025Q3: For 2026, we expect continued margin growth... timing depends on factors like loan/deposit growth and Fed policy. - [Byron Pollan](Treasurer)

Contradiction Point 2

Expense Outlook and Efficiency Ratio Targets

It involves contradictory guidance on the timing and magnitude of expense reductions from the Guaranty acquisition, affecting the forecast of the company's efficiency and profitability.

What is the core expense run rate heading into the new year, how will expenses trend, and are there plans for investments or hiring? - David Feaster (Raymond James)

2025Q4: Hiring for talent... not a material expense increase." and "The efficiency ratio is expected to improve to the mid-50% range (54–55%) by the second half of 2026. - [Ron Copher](CFO) & [Randy Chesler](CEO)

Will Q4 expenses moderate by 2026 due to cost savings from the Guaranty conversion? - Andrew Terrell (Stephens)

2025Q3: A 20% reduction in noninterest expenses is modeled, with 50% achieved in 2026 and the other 50% in 2027, leading to some moderation. - [Ron Copher](CFO)

Contradiction Point 3

Net Interest Margin (NIM) Growth Trajectory and Drivers

It involves a contradiction on whether NIM growth is dependent on Fed policy and the magnitude of expected contribution from the Guaranty acquisition, which are key elements for understanding the company's financial strategy and performance drivers.

What is the trajectory for net interest margin (NIM) and confidence in reaching 4% by 2026, and how dependent is this on Fed cuts? - David Feaster (Raymond James)

2025Q4: NIM momentum is strong and structural, not dependent on Fed policy. The company expects to reach ~4% NIM in the second half of 2026. - [Byron Pollan](Treasurer)

Can you clarify if the current quarter includes any one-time margin accretion and whether the all-in number is progressing toward the pre-Guaranty exit rate? - Jeffrey Allen Rulis (D.A. Davidson & Co.)

2025Q2: With Guaranty... I think Guaranty could add an additional 6 to 7 basis points on top of what we just discussed. - [Byron Pollan](Treasurer)

Contradiction Point 4

Timing and Impact of Guaranty Acquisition on Expenses and Margins

It involves a contradiction on when acquisition-related costs stabilize and when margin contribution from Guaranty materializes, which is crucial for understanding the financial impact and timing of strategic acquisitions.

Can you clarify the expense guidance, deposit cost increase, timing of cost savings from Guaranty, and whether net charge-offs were unusual? - Matthew Clark (Piper Sandler)

2025Q4: The deposit cost uptick was due to the Guaranty acquisition, and costs are expected to trend down. Cost saves from Guaranty will take hold after the conversion in February. - [Ron Copher](CFO)

Where do you expect expenses and growth to head moving forward? - Jeffrey Allen Rulis (D.A. Davidson & Co.)

2025Q2: Assuming we're going to close on Guaranty in, say, October 31, you would add $14 million to the guide I gave for the fourth quarter to include Guaranty. - [Ron Copher](CFO)

Contradiction Point 5

Expense Guidance and Outlook

It involves a contradiction on the quarterly expense run rate guidance for Q2 2025/Q1 2026, which is essential for forecasting the company's operational costs and financial health.

What is the core expense run rate for the new year, and how do you expect expenses to trend, including any plans for investments or hiring? - David Feaster (Raymond James)

2025Q4: Q1 2026 core non-interest expense guide: $189–$193 million... Expenses will step down in Q2–Q4 as the company grows into its expense base. - [Ron Copher](CFO) & [Randy Chesler](CEO)

Can you share an update on the expense guidance? - Jeff Rulis (D.A. Davidson)

2025Q1: The core noninterest expense guide for 2025 remains: $151-154 million per quarter, skewing towards $154 million in Q1 and stepping down to $151-152 million for the remaining quarters. - [Ron Copher](CFO)