Detailed narrative
Optimize Origin Strategy
The "Optimize Origin" initiative, launched 18 months ago, has transformed the company's operations, leading to improved financial performance and a strengthened culture. This strategy influences capital allocation, technology investment, talent recruitment, and client service, positioning Origin for long-term value creation. Management emphasized the consistency of performance as a key benefit of this ongoing transformation.
Strategic Talent Acquisition
Origin Bancorp continues to capitalize on market disruption🌐 by attracting experienced bankers and quality clients. The company added 12 bankers in Q2, following 15 in Q1, expanding into Birmingham, Alabama, and reinforcing talent in North Texas, Houston, East Texas, and Mississippi. This lift-out strategy is driving strong pipelines and future revenue streams, with only $12 million of loan growth year-to-date attributed to 2026 hires, indicating significant future potential.
Disciplined Growth and Profitability
The company emphasizes balanced and disciplined growth, focusing on relationship profitability, pricing, core deposit generation, and long-term returns. Loan growth is concentrated in dynamic markets like Texas and the Southeast, generating $323 million in H1, with over 50% of year-to-date growth in C&I. New loans are priced around 6.4%, reflecting strong discipline despite competitive pressures on terms and non-recourse offerings.
Deposit Franchise Strength
Noninterest-bearing deposits increased nearly $200 million during the quarter, now representing 26% of total deposits, indicating success in winning primary banking relationships. New deposit account openings accelerated meaningfully, up over 36% year-over-year in the first half, with June seeing an 82% increase to over 1,800 new accounts, reflecting strong client acquisition and market dislocation.
Technology and Culture Investments
Origin is making meaningful investments in technology, AI, and data to enhance its operating model, improve productivity, and scale the franchise efficiently. Concurrently, the company's culture remains a competitive advantage, with high employee satisfaction and engagement scores from its Glint survey, ranking among the top 10% globally across all industries. These investments are designed to give bankers better information and faster insights.
Credit Quality
The company reported sound and improving credit metrics during Q2 FY26. Total past due 30 to 89 days decreased to 0.06%, reflecting the lowest level over the past 5 quarters. Net charge-offs were minimal at $454,000, benefiting from $2 million in recoveries, resulting in an annualized rate of 0.02% for the quarter and 0.08% year-to-date. Nonperforming assets decreased $9 million to 0.98% of loans, also a 5-quarter low, and classified assets declined $10.2 million to 1.79%.