Butterfield Reports 2025 Fourth Quarter Results
The Bank of N.T. Butterfield & Son Limited announced financial results for the quarter ended December 31, 2025.
A spokesperson said, “Net income for the year ended December 31, 2025 was $231.9 million, or $5.47 per diluted common share, compared to $216.3 million, or $4.71 per diluted common share, for the year ended December 31, 2024. Core net income1 for the year ended December 31, 2025 was $237.5 million, or $5.60 per diluted common share, compared to $218.9 million, or $4.77 per diluted common share, for the year ended December 31, 2024.
“The return on average common equity for the year ended December 31, 2025 was 21.7% compared to 21.4% for the year ended December 31, 2024. The core return on average tangible common equity1 for the year ended December 31, 2025 was 24.2%, compared to 24.0% for the year ended December 31, 2024. The efficiency ratio for the year ended December 31, 2025 was 59.4% compared with 60.4% for the year ended December 31, 2024. The core efficiency ratio1 for the year ended December 31, 2025 was 58.5% compared with 60.0% for the year ended December 31, 2024.”
Michael Collins, Butterfield’s Chairman and Chief Executive Officer, commented, “Throughout 2025 Butterfield delivered strong financial results supported by disciplined strategic execution. We achieved year-on-year net income growth, with core net income per diluted share increasing 17.4% compared to 2024. Our relationshipfocused banking and private trust businesses increased non-interest income, while net interest income benefited from lower deposit costs and higher yielding asset redeployment. Butterfield remained focused on expense management, while completing a number of value-added projects that have advanced our technology platform.
“Capital management remains integral to Butterfield’s strategy, with an increase in the quarterly dividend as well as share repurchases driving a combined payout ratio approaching 100% of net income for 2025. In addition, we remain focused on growth through private trust and bank acquisitions in order to achieve scale in island markets that we understand.
“On behalf of my fellow Directors, I am pleased to welcome Meroe Park back to Butterfield. Meroe brings over three decades of distinguished public service experience, including Deputy Secretary and Chief Operating Officer of the Smithsonian Institution and Executive Director and Chief Operating Officer at the Central Intelligence Agency, where she operated at the intersection of governance, operations, and public accountability. Meroe’s ability to navigate complexity and lead in demanding professional environments with diverse stakeholders, combined with her background in human resources, operations, technology, and cyber security will add meaningful depth to our Board deliberations.”
A spokesperson added, “Net income for the fourth quarter of 2025 was $63.8 million, or $1.54 per diluted common share, compared to net income of $61.1 million, or $1.46 per diluted common share, for the previous quarter and $59.6 million, or $1.34 per diluted common share, for the fourth quarter of 2024. Core net income1 for the fourth quarter of 2025 was $63.8 million, or $1.54 per diluted common share, compared to $63.3 million, or $1.51 per diluted common share, for the previous quarter and $59.6 million, or $1.34 per diluted common share, for the fourth quarter of 2024.
“The return on average common equity for the fourth quarter of 2025 was 22.7% compared to 22.5% for the previous quarter and 22.9% for the fourth quarter of 2024. The core return on average tangible common equity1 for the fourth quarter of 2025 was 24.6%, compared to 25.5% for the previous quarter and 25.2% for the fourth quarter of 2024. The efficiency ratio for the fourth quarter of 2025 was 57.2%, compared to 57.7% for the previous quarter and 58.2% for the fourth quarter of 2024. The core efficiency ratio1 for the fourth quarter of 2025 was 57.2% compared with 56.2% in the previous quarter and 58.2% for the fourth quarter of 2024.
“Net income and core net income1 were up in the fourth quarter of 2025 versus the prior quarter, primarily due to higher non-interest income and lower provision for credit losses, which were partially offset by higher non-interest expenses.
“Net interest income [“NII”] for the fourth quarter of 2025 was $92.6 million, relatively flat compared to $92.7 million in the previous quarter and $4.0 million higher compared to $88.6 million in the fourth quarter of 2024. NII was higher during the fourth quarter of 2025 compared to the fourth quarter of 2024 due to a lower cost of deposits as central banks have reduced market interest rates and investment yields have increased as assets were deployed into higher yielding available-for-sale investment securities, which were partially offset by lower loan and treasury yields.
“Net interest margin [“NIM”] for the fourth quarter of 2025 was 2.69%, a decrease of 4 basis points from the previous quarter at 2.73% and compares favorably to 2.61% in the fourth quarter of 2024. NIM in the fourth quarter of 2025 decreased compared to the prior quarter due to lower treasury and loan yields as central banks cut market interest rates. NIM in the fourth quarter of 2025 increased compared to the fourth quarter of 2024 due to lower cost of deposits, which were partially offset by lower treasury and loan yields.
“Non-interest income for the fourth quarter of 2025 was $66.3 million, an increase of $5.1 million from $61.2 million in the previous quarter and $3.0 million higher than $63.2 million in the fourth quarter of 2024. The increase in the fourth quarter of 2025 compared to the prior quarter was due to higher banking revenue due to seasonality, higher third party credit card volume incentives and higher trust revenue from new clients and fee increases. Non-interest income in the fourth quarter of 2025 was higher than the fourth quarter of 2024 due to higher trust revenue from new clients and fee increases and increased asset management fees from higher valuation, partially offset by lower banking revenue.
“Non-interest expenses were $93.1 million in the fourth quarter of 2025, compared to $90.8 million in the previous quarter and $90.6 million in the fourth quarter of 2024. Core non-interest expenses1 of $93.1 million in the fourth quarter of 2025 were higher compared to the $88.5 million incurred in the previous quarter and the $90.6 million in the fourth quarter of 2024. Core non-interest expenses1 in the fourth quarter of 2025 were higher compared to the prior quarter due to increased professional and outside services costs, salaries and benefits, technology and communications, marketing and other non-interest expenses. Core non-interest expenses1 in the fourth quarter of 2025 were higher compared to the fourth quarter of 2024 due to salaries and benefits and professional and outside services cost.
“Period end deposit balances remained relatively flat at $12.7 billion compared to December 31, 2024. Average deposits were $12.8 billion in the quarter ended December 31, 2025, which is slightly higher than the $12.6 billion in the prior quarter.
“Tangible book value per share1 at the end of the fourth quarter of 2025 was $26.41 per share, higher than $25.06 per share at the end of the prior quarter and an increase over the $21.70 at December 31, 2024. The tangible book value per share1 continues to improve due to OCI burndown and retained earnings, net of dividends.
“The Board declared a quarterly cash dividend rate of $0.50 per common share to be paid on March 9, 2026 to shareholders of record on February 23, 2026. During the fourth quarter of 2025, Butterfield repurchased 0.6 million common shares under the Bank’s existing share repurchase program. On December 8, 2025, the Board approved a new share repurchase program to replace its expiring program, authorizing the purchase of up to 3.0 million common shares through to December 31, 2026. The new share repurchase authorization took effect on January 1, 2026.
“Effective January 1, 2025, the Bank has adopted the Basel Committee on Banking Supervision’s ["BCBS"] revised standardized approach for credit risk framework as required by the Bermuda Monetary Authority ["BMA"]. Comparatives were prepared under the prior credit risk framework. The current total regulatory capital ratio as at December 31, 2025 was 27.8%, compared to 25.8% as at December 31, 2024. Both of these ratios remain conservatively above the minimum regulatory requirements applicable to the Bank.”
