ONB Stock Forecast & Price Target

Old National Bancorp reported a sequential increase in both spread revenues and core fee income, with spread revenues rising 0.6% to $394.2 million and core fee income up 1.7% to $95.8 million, indicating stable revenue generation. Additionally, organic core deposits saw a slight increase of 0.5% sequentially, reaching $39.3 billion, reflecting a solid foundation for future funding and investment growth. Furthermore, the growth in average deposits by 5.3% annually, primarily driven by private banking and community deposits, reinforces the bank's robust ability to attract and retain customer funds.

Old National Bancorp experienced a significant decline in mortgage banking results, reporting an 8.4% decrease sequentially to $7.0 million, along with a notable 29.4% drop in capital markets revenues to $5.2 billion. The company's core margin decreased by 4 basis points to approximately 3.15%, while total loans decreased by 0.3% sequentially to $36.3 billion, primarily driven by reductions in commercial and industrial (C&I) and commercial real estate (CRE) balances. Additionally, total deposits saw a slight decline of 0.1% to $40.8 billion, indicating stagnation in non-loan earning asset growth, which raises concerns about the bank's future revenue generation.