Horizon Bancorp, Inc. (HBNC): ANSOFF MATRIX [Dec-2025 Updated]

You're looking for clear, actionable growth strategies for Horizon Bancorp, Inc. (HBNC), and the Ansoff Matrix is the defintely the right framework to map out near-term risks and opportunities, especially now that the major balance sheet repositioning-which caused the Q3 2025 net loss of $222.0 million but expanded the Net Interest Margin to 3.52%-is largely complete. As CEO Thomas Prame noted, the focus shifts to the 'smart redeployment of our peer-leading capital generation' for 2026. This matrix distills that mandate into four distinct paths, moving you from safe bets like increasing digital marketing spend to aggressive diversification plays, giving you the precise blueprint needed to translate recent structural changes into durable returns for Horizon Bancorp, Inc. (HBNC) shareholders.

Horizon Bancorp, Inc. (HBNC) - Ansoff Matrix: Market Penetration

You're looking at how Horizon Bancorp, Inc. (HBNC) can grab more existing market share. This is about digging deeper into the markets where Horizon Bank already operates, using existing products or slight variations.

For digital marketing, the industry trend shows digital channels capturing nearly 62% of bank marketing budgets in 2025, a shift from offline tactics. Horizon Bancorp, Inc. previously exited its mortgage warehouse business, which realized a $7.0 million pre-tax gain in the first quarter of 2025. Still, the core commercial loan engine showed strong momentum, adding $117.2 million, or 14.8% annualized, in the second quarter of 2025.

To draw deposits, Horizon Bank is running a 3.40% APY 5-Month Certificate of Deposit special. To get this rate, a minimum deposit of $10,000 is required if the money is not currently on deposit at Horizon Bank. The standard Personal Savings Account has a $5 monthly maintenance fee, while the Money Market Account has a $10 monthly maintenance fee, both waived with a minimum daily balance. Total deposits were $5.77 billion as of March 31, 2025, but this figure decreased to $5.5 billion by September 30, 2025, even as the company worked to reduce over $125 million in non-core, higher-cost transactional deposit balances during the third quarter of 2025.

Cross-selling wealth management to commercial loan clients means targeting a growing base. Total assets for Horizon Bancorp, Inc. stood at $7.7 billion as of June 30, 2025. The company offers wealth management solutions alongside its in-market business banking services.

Boosting retention through a loyalty program ties into overall deposit stability. Core deposits showed growth of 24% annualized in the first quarter of 2025. The efficiency ratio improved to 59.48% in the second quarter of 2025, reflecting prudent management of expenses, which were up less than 1% from the first quarter of 2025 to the second quarter of 2025.

Optimizing branch operations involves managing the physical footprint. Horizon Bank operates 82 Branches across Indiana and Michigan. The focus on efficiency is clear in the financial results, with Net Interest Income growing to $58.4 million in the third quarter of 2025 from $55.4 million in the second quarter of 2025, driven by an expanded Net Interest Margin of 3.52% in the third quarter of 2025.

Here's a quick look at some key 2025 performance metrics:

The company is definitely focused on core franchise strength. You can see the commitment to disciplined pricing and asset deployment in the margin expansion, which hit its eighth consecutive quarter of growth by Q3 2025.

• Total Assets as of June 30, 2025: $7.7 billion.
• Net Charge-Offs (Q3 2025): Annualized 0.07% of Average Loans Outstanding.
• Subordinated Notes Redemption Date: October 1, 2025 (for $56.5 million).
• Earnings Per Share (6 Months 2025): Grew 58% versus the comparable period in 2024.
• CD Minimum Deposit (General): $500.

Finance: draft 13-week cash view by Friday.

Horizon Bancorp, Inc. (HBNC) - Ansoff Matrix: Market Development

You're looking at how Horizon Bancorp, Inc. can take its existing commercial banking and treasury management services into new geographic territories. The foundation for this move is solid, given the recent balance sheet cleanup.

The total assets for Horizon Bancorp, Inc. stood at $7.7 billion as of June 30, 2025, which then decreased to $6.7 billion by September 30, 2025, following the strategic repositioning that included selling approximately $1.7 billion of securities. The core business, however, shows strength; Net Interest Income for the third quarter of 2025 was $58.4 million, expanding the Net Interest Margin to 3.52% on an FTE basis. Credit quality remains tight, with annualized Net Charge-Offs at 0.07% of Average Loans Outstanding for Q3 2025.

Here's how the Market Development strategies map against current financial capacity and operational focus:

• Expand commercial lending operations into a contiguous state, like Ohio or Kentucky, via a loan production office.
• Launch a targeted digital-only banking platform to serve a younger demographic across the Midwest.
• Acquire a small, non-competing community bank in an adjacent metropolitan statistical area (MSA).
• Partner with national real estate developers to offer construction financing outside the core Indiana/Michigan footprint.
• Introduce existing treasury management services to mid-sized businesses in new, underserved regional cities.

For expanding commercial lending, remember that commercial lending already represents over half of total loans for Horizon Bancorp, Inc.. In the second quarter of 2025, commercial loans grew by $117.2 million, an annualized increase of 14.8%. This growth engine is what you'd deploy into a new contiguous market.

The acquisition strategy is supported by recent capital activity. Horizon Bancorp, Inc. closed on an equity offering for net proceeds of $98.6 million and also closed on $100,000,000 in subordinated notes in August 2025. This fresh capital provides the dry powder needed for an inorganic move into an adjacent MSA.

Partnering for construction financing leverages the existing loan mix. In Q2 2025, commercial loans had a mix where 58% was commercial real estate. Horizon Bancorp, Inc. already offers equipment financing solutions nationally.

To support these new market entries, you need to track the operational cost base. Total Non-Interest Expense for the third quarter of 2025 was $53.0 million. The Allowance for Credit Losses as a percentage of period-end loans HFI was 1.04% at September 30, 2025.

Here's a look at the capital structure supporting this expansion:

The digital platform launch across the Midwest relies on the existing franchise strength in Indiana and Michigan, which are served through branches and 'convenient digital and virtual tools'. The successful execution of the balance sheet repositioning is intended to improve run-rate earnings into 2026.

Introducing treasury management services to new regional cities is a direct play on the core banking platform. The Q3 2025 Net Interest Income of $58.4 million shows the current earning asset base is performing well.

• Commercial Loan Growth (Q2 2025 annualized): 14.8%.
• Commercial Real Estate Mix (Q2 2025): 58% of commercial loans.
• New Subordinated Notes Issued (August 2025): $100,000,000.
• Common Stock Net Proceeds (August 2025): $98.6 million.
• Securities Sold in Repositioning: Approximately $1.7 billion.

Finance: draft 13-week cash view by Friday.

Horizon Bancorp, Inc. (HBNC) - Ansoff Matrix: Product Development

Roll out a fully integrated small business loan application process with a 24-hour approval guarantee.

Develop a specialized, high-yield 'green' CD product tied to sustainable community investments, supporting a Net Interest Margin that expanded to 3.52% on an FTE basis in the third quarter of 2025.

Introduce a proprietary financial wellness app with budgeting and credit monitoring tools for retail customers, alongside a core client-driven deposit franchise that is growing.

Create a suite of tailored lending products for the growing local agricultural technology sector, building on commercial loan yields that averaged 7.15% in the first quarter of 2025.

Offer a premium, fee-based private banking service for high-net-worth individuals, leveraging a capital base that saw a $103.5 million gross proceeds capital raise in August 2025.

The capacity for new product investment is supported by the balance sheet repositioning efforts, which included redeploying approximately $600 million into new investment securities yielding 5.27% on a tax-equivalent basis.

Here's a quick look at the financial context as of late 2025:

These product development initiatives align with the continued strength in core banking areas:

• Commercial loan growth added $57.9 million annualized in Q3 2025.
• Leasing yields reached 8.40% in the first quarter of 2025.
• The company redeemed approximately $700 million in Federal Home Loan Bank advances.
• Total capital to risk-weighted assets was 14.28% as of March 31, 2025.
• The new subordinated notes offering in August 2025 was for $100,000,000.

If onboarding for the small business loan process takes longer than 24 hours, churn risk rises.

Horizon Bancorp, Inc. (HBNC) - Ansoff Matrix: Diversification

You're looking at how Horizon Bancorp, Inc. (HBNC) can expand beyond its core lending and deposit-taking by pursuing diversification strategies, which is the most aggressive quadrant of the Ansoff Matrix. The foundation for this is built on recent balance sheet restructuring and core performance. For instance, the Net Interest Margin (FTE basis) expanded for the eighth consecutive quarter, reaching 3.52% in the third quarter of 2025, up from 2.97% in the fourth quarter of 2024. This strong core profitability provides the capital base for these new ventures.

The company has already demonstrated an appetite for non-interest income generation through asset sales. The sale of the mortgage warehouse business in the first quarter of 2025 resulted in a pre-tax gain of $7.0 million. This contrasts with the $\text{39.1 million}$ pre-tax loss on investment securities sales in the fourth quarter of 2024, showing the volatility that non-core asset management can introduce, but also the potential for realized gains.

Here's a look at the scale and recent core performance that supports capital deployment for diversification:

The proposed diversification moves aim to create more durable, fee-based revenue streams, moving beyond the realized gains/losses seen from securities repositioning. The leadership team is focused on profitable growth and smart redeployment of capital generation heading into 2026.

The specific diversification avenues being considered for Horizon Bancorp, Inc. (HBNC) include:

• Establish a non-bank subsidiary focused on providing technology escrow and payment processing services.
• Invest in a minority stake in a regional FinTech company specializing in B2B payments.
• Launch a specialized insurance brokerage arm focused on commercial property and casualty policies.
• Acquire a registered investment advisor (RIA) firm to significantly boost non-interest income.
• Enter the equipment leasing market for small to mid-sized manufacturing businesses in the region.

The successful capital raise in August 2025, which included net proceeds of $98.6 million from a common stock offering and $100,000,000 in new subordinated notes, provides the immediate liquidity to fund these strategic expansions. The notes priced with a fixed interest rate of 7.00% per annum until September 15, 2030, which compares favorably to the initially assumed 7.50% fixed rate. This disciplined capital management is key to funding these new business lines.

For the nine months ended September 30, 2025, the net loss was $177.4 million, heavily impacted by the balance sheet transformation, but the core commercial loan engine is producing solid results, and credit quality remains excellent, with Net Charge-Offs at an annualized 0.07% of Average Loans Outstanding in Q3 2025. Finance: draft 13-week cash view by Friday.