Heritage Commerce Corp Reports First Quarter 2025 Financial Results

San Jose, CA – April 24, 2025

Heritage Commerce Corp (Nasdaq: HTBK), the holding company for Heritage Bank of Commerce, today announced its unaudited financial results for the first quarter of 2025.

Quarterly Highlights

• Net Income: $11.6 million
• Earnings Per Share: $0.19
• Pre-Provision Net Revenue (PPNR): $16.6 million
• Fully Tax Equivalent (FTE) Net Interest Margin: 3.39%
• Efficiency Ratio: 63.96%
• Tangible Book Value Per Share: $8.48

CEO Commentary

“We delivered a solid quarter of performance with a 9% increase in our level of profitability from the prior quarter,” said Clay Jones, President and Chief Executive Officer.

“While our balance sheet trends reflected the seasonally low loan demand and deposit outflows in the first quarter, we generated a higher level of profitability due to improved net interest margin, strong expense control, and an improvement in our asset quality.”

“While economic uncertainty has increased over the past few months, we still expect to deliver solid financial performance in 2025…”

Financial Highlights

Linked-Quarter

• Net income of $11.6 million and EPS of $0.19, up 9% and 12%
• Total revenue of $46.1 million, down 1%
• Noninterest expense decreased by 3%
• PPNR increased to $16.6 million
• Effective tax rate: 28.8%

Year-Over-Year

• Net income up 14% and EPS up 12%
• Total revenue up 9%, noninterest expense up 7%
• PPNR up by $2 million
• Effective tax rate: 28.8%

Financial Condition

• Loans HFI remained flat at $3.5 billion
• Total deposits: $4.7 billion, down 3%
• Loan to deposit ratio: 74.45%
• Total shareholders’ equity: $696 million

Credit Quality

• NPAs to total assets: 0.11%
• Classified assets to total assets: 0.73%

Key Performance Metrics

• FTE net interest margin: 3.39%
• Return on average tangible assets: 0.88%
• Return on tangible common equity: 9.09%
• Efficiency ratio: 63.96%
• Common equity tier 1 capital ratio: 13.6%
• Total capital ratio: 15.9%
• Tangible common equity ratio: 9.78%
• Tangible book value per share: $8.48

Non-GAAP Financial Measures

This document includes certain non-GAAP performance metrics used by management to assess the company’s financial performance. These include PPNR, FTE net interest margin, efficiency ratio, tangible common equity ratios, and others. They are intended to supplement but not replace GAAP measures.

Forward-Looking Statement Disclaimer

Statements included in this release that are not historical facts are forward-looking and subject to various risks and uncertainties. Actual results may differ materially. Risks are discussed in detail in the Company’s filings with the SEC.

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