Core Insights - ChoiceOne Financial Services, Inc. reported a net loss of $13.9 million for Q1 2025, a significant decline compared to a net income of $5.6 million in Q1 2024, primarily due to merger-related expenses and provisions for credit losses [5][6][19] - The merger with Fentura Financial, Inc. and The State Bank was completed on March 1, 2025, significantly enhancing ChoiceOne's market presence and capabilities [4][21] - Total assets increased to $4.3 billion as of March 31, 2025, up from $2.7 billion a year earlier, largely driven by the merger [7][17] Financial Performance - The diluted loss per share was $1.29 for Q1 2025, compared to diluted earnings per share of $0.74 in the same period of the previous year [6][29] - Net interest income rose to $26.3 million in Q1 2025, up from $16.5 million in Q1 2024, attributed to the merger's contribution [5][28] - The GAAP net interest margin increased to 3.43% in Q1 2025, compared to 2.67% in Q1 2024, reflecting the merger's impact [5][30] Loan and Deposit Growth - Core loans grew by $1.4 billion due to the merger, with organic growth of $40.1 million or 10.6% annualized in Q1 2025 [8][11] - Deposits, excluding brokered deposits, increased by $1.4 billion as of March 31, 2025, driven by the merger and organic growth [11][12] - The loan-to-deposit ratio stood at 80.21% as of March 31, 2025, indicating a balanced approach to asset management [7] Asset Quality and Credit Losses - The provision for credit losses was $13.1 million in Q1 2025, primarily due to the acquisition of non-PCD loans [14] - Asset quality remained strong, with annualized net loan charge-offs to average loans at 0.01% and nonperforming loans at 0.65% as of March 31, 2025 [14][19] Merger Impact - The merger resulted in approximately $1.8 billion in total assets, $1.4 billion in loans, and $1.4 billion in deposits being acquired [5][11] - ChoiceOne recognized a core deposit intangible of $31 million related to the merger, amortized over 10 years [10] - The valuation mark on acquired loans was estimated at a reduction of $64.7 million, with $59.8 million expected to be accretable to interest income [9]

Core Viewpoint - ChoiceOne Financial Services, Inc. has successfully consolidated The State Bank into ChoiceOne Bank, enhancing operational efficiency and growth opportunities in Michigan [1][2]. Group 1: Consolidation Details - The consolidation of The State Bank into ChoiceOne Bank was completed on March 14, 2025, with The State Bank now operating under the ChoiceOne Bank name [1]. - This merger follows the earlier completion of the merger with Fentura on March 1, 2025, resulting in a financial holding company with over $4 billion in assets and 56 offices across West, Central, and Southeast Michigan [3]. Group 2: Leadership and Community Engagement - Former Fentura CEO Ronald Justice highlighted the merger as a significant opportunity for customers, communities, employees, and shareholders, emphasizing the cultural and geographical fit [4]. - The company celebrated its name change with community officials and made donations to local nonprofit organizations, reinforcing its commitment to community support [5]. Group 3: Company Overview - ChoiceOne Financial Services, Inc. is headquartered in Sparta, Michigan, and operates as a financial holding company with over $4 billion in assets [6]. - ChoiceOne Bank provides insurance and investment products through its subsidiary, ChoiceOne Insurance Agencies, Inc., and is listed on the Nasdaq Capital Market under the symbol "COFS" [6].

Core Viewpoint - ChoiceOne Financial Services has successfully completed the merger with Fentura Financial, creating a bank holding company with assets exceeding $4 billion and operating 56 offices across Michigan [1][2]. Group 1: Merger Details - The merger between ChoiceOne Financial Services and Fentura Financial became effective on March 1, 2025 [1]. - The combined organization will be headquartered in Sparta, Michigan, and will consolidate The State Bank into ChoiceOne Bank, effective March 14, 2025 [2]. Group 2: Strategic Benefits - The acquisition is described as a natural geographical and cultural fit, allowing for an expansion of the community bank franchise into Central and Southeastern Michigan [2]. - The merger is expected to enhance the range and capacity for commercial and consumer lending, alongside advancements in technology [2]. - ChoiceOne aims to provide a comprehensive line of products and services to small businesses and consumers in West, Central, and Southeast Michigan through an improved retail network [2]. Group 3: Company Overview - ChoiceOne Financial Services is a financial holding company and the parent corporation of ChoiceOne Bank and The State Bank, collectively operating 56 offices in various counties across Michigan [3]. - The company offers insurance and investment products through its subsidiary, ChoiceOne Insurance Agencies, Inc. [3]. - ChoiceOne Financial Services is publicly traded on the Nasdaq Capital Market under the symbol "COFS" [3].

Core Viewpoint - ChoiceOne Financial Services, Inc. has received regulatory approval to merge with Fentura Financial, Inc., enhancing its presence in Michigan and creating a combined organization with approximately $4.3 billion in assets [1][2]. Company Overview - ChoiceOne Financial Services, Inc. is headquartered in Sparta, Michigan, and operates as the parent company of ChoiceOne Bank, which has 35 offices across several counties [3]. - The company is currently an approximately $2.6 billion-asset bank holding company, ranking as the eighth largest in Michigan based on asset size [3]. - ChoiceOne Bank offers a range of financial products, including insurance and investment services through its subsidiary [3]. Fentura Financial Overview - Fentura Financial, Inc. is the holding company for The State Bank, which operates 21 offices in various counties in Michigan [4]. - The State Bank provides a full array of banking services, including consumer, mortgage, and wealth management, while also engaging in community support initiatives [4]. Merger Details - The merger is expected to be effective on March 1, 2025, with the bank consolidation anticipated to take place on March 14, 2025 [2]. - Post-merger, the combined entity will operate under the ChoiceOne name and brand, expanding its geographical footprint into several new counties [2].

Core Insights - ChoiceOne Financial Services, Inc. (COFS) reported quarterly earnings of $0.83 per share, matching the Zacks Consensus Estimate and showing an increase from $0.70 per share a year ago [1] - The company achieved revenues of $24.34 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 1.43% and up from $20.6 million year-over-year [2] - The stock has underperformed the market, losing about 1.4% since the beginning of the year compared to the S&P 500's gain of 2.9% [3] Earnings Performance - The company has surpassed consensus EPS estimates three times over the last four quarters, with a notable surprise of 25.68% in the previous quarter [1][2] - The current consensus EPS estimate for the upcoming quarter is $0.93, with expected revenues of $34.5 million, and for the current fiscal year, the estimate is $3.80 on $167.7 million in revenues [7] Market Outlook - The earnings outlook and estimate revisions will significantly influence the stock's immediate price movement, with the current Zacks Rank for the stock being 3 (Hold), indicating expected performance in line with the market [6] - The Financial - Miscellaneous Services industry, to which ChoiceOne belongs, is currently in the top 36% of Zacks industries, suggesting a favorable environment for stock performance [8]

Core Financial Performance - ChoiceOne Financial Services reported a net income of $7,159,000 for Q4 2024, a 35.3% increase from $5,293,000 in Q4 2023, and a total net income of $26,727,000 for the full year 2024, up 25.7% from $21,261,000 in 2023 [4][8] - Diluted earnings per share for Q4 2024 were $0.79, compared to $0.70 in Q4 2023, and for the full year, it was $3.25, up from $2.82 in 2023 [4][8] - Adjusted net income, excluding merger-related expenses, was $7,532,000 for Q4 2024 and $27,733,000 for the full year [4][8] Asset and Loan Growth - Total assets increased to $2.7 billion as of December 31, 2024, up $146.5 million from the previous year, primarily driven by a $114.5 million increase in core loans [5][8] - Core loans grew by $40.3 million or 11.0% on an annualized basis in Q4 2024 and $114.5 million or 8.2% for the full year [8][10] - The company strategically shifted from lower-yielding assets to higher-yielding loans to support organic loan growth [5][8] Deposit Trends - Deposits, excluding brokered deposits, decreased by $24.0 million or an annualized 4.4% in Q4 2024 but increased by $79.0 million or 3.8% for the full year [6][8] - The decline in deposits during Q4 was attributed to seasonal outflows of public funds [6][8] - Total available borrowing capacity secured by pledged assets was $837.2 million as of December 31, 2024 [6][8] Interest Income and Margin - Net interest income for Q4 2024 was $19.3 million, compared to $16.6 million in Q4 2023, aided by cash settlements from pay-fixed interest rate swaps [8][10] - The GAAP net interest margin decreased to 2.98% in Q4 2024 from 3.17% in Q3 2024 but increased from 2.66% in Q4 2023 [8][10] Noninterest Income and Expenses - Noninterest income increased by $948,000 in Q4 2024 and $3.1 million for the full year, driven by higher customer service charges and earnings on life insurance policies [13][14] - Noninterest expenses rose by $1.6 million or 11.4% in Q4 2024 and $3.6 million or 6.6% for the full year, influenced by merger-related expenses and increased employee benefit costs [14][8] Merger and Future Outlook - The company is preparing for a merger with Fentura Financial, Inc. and The State Bank, expected to close in Q1 2025, which is anticipated to enhance market presence and capabilities [3][15] - The CEO expressed optimism about the merger and its potential benefits for customers and communities [15]

Financial Performance - ChoiceOne reported net income of $7,159,000 for Q4 2024, a 35.3% increase from $5,293,000 in Q4 2023, and $26,727,000 for the full year 2024, up 25.7% from $21,261,000 in 2023[4] - Diluted earnings per share were $0.79 for Q4 2024, compared to $0.70 in Q4 2023, and $3.25 for the full year 2024, up from $2.82 in 2023[4] - Adjusted net income for the three months ended December 31, 2024, was $7,532, up from $5,293 in 2023, reflecting a year-over-year increase of 42.3%[29] - Basic earnings per share for the twelve months ended December 31, 2024, were $3.27, compared to $2.82 in 2023, marking a 15.9% increase[26] - Net income for the twelve months ended December 31, 2024, was $26,727, representing a 25.7% increase from $21,261 in 2023[26] Asset and Loan Growth - Total assets increased to $2.7 billion as of December 31, 2024, up $146.5 million from the previous year, driven by a $114.5 million increase in core loans[5] - Core loans grew by $40.3 million or 11.0% on an annualized basis in Q4 2024, and by $114.5 million or 8.2% for the full year 2024[5] - Core loans increased to $1,505,762 as of December 31, 2024, from $1,465,458 as of September 30, 2024, indicating a growth of 2.0%[24] - Gross loans increased to $1,552,928,000 in Q4 2024, up 2.8% from $1,509,944,000 in Q3 2024[31] - Average loans increased to $1,516,466,000 in Q4 2024, up from $1,359,643,000 in Q4 2023, indicating a growth of approximately 11.5%[34] Income and Expenses - Noninterest income increased by $948,000 in Q4 2024 and by $3.1 million for the full year 2024, primarily due to higher customer service charges and earnings on life insurance policies[12] - Noninterest expense rose by $1.6 million or 11.4% in Q4 2024, attributed to merger-related expenses and increased employee benefit costs[13] - Noninterest income for the twelve months ended December 31, 2024, was $17,995, an increase from $14,906 in 2023, representing a growth of 20.0%[26] - Noninterest expense for the twelve months ended December 31, 2024, was $58,723, compared to $55,074 in 2023, reflecting an increase of 4.8%[26] Credit Losses and Provisions - The provision for credit losses expense on loans was $200,000 in Q4 2024, with a ratio of allowance for credit losses to total loans at 1.07%[9] - The provision for credit losses on loans for the three months ended December 31, 2024, was $200, a decrease from $933 in the same period of 2023[26] - The company reported a net provision for credit losses expense of $625 for the twelve months ended December 31, 2024, compared to $150 in 2023, indicating a significant increase in credit loss provisions[26] Shareholder Equity and Mergers - Shareholders' equity totaled $260.4 million as of December 31, 2024, up from $195.6 million a year earlier, largely due to proceeds from the sale of common stock[11] - The anticipated merger with Fentura Financial, Inc. and The State Bank is expected to close in Q1 2025, enhancing ChoiceOne's market capabilities[3] Interest and Capital Ratios - Net interest income for the three months ended December 31, 2024, was $19,349, an increase of 10.8% from $16,556 for the same period in 2023[26] - Net interest margin (GAAP) was 2.98% in Q4 2024, down from 3.17% in Q3 2024[33] - Total capital to risk-weighted assets ratio was 14.5% in Q4 2024, down from 15.0% in Q3 2024[32] Employee and Operational Metrics - Full-time equivalent employees increased to 377 in Q4 2024, up from 371 in Q3 2024[32] - Total assets as of Q4 2024 were $2,723,243,000, a slight decrease from $2,726,003,000 in Q3 2024[31]

Core Viewpoint - ChoiceOne Financial Services and Fentura Financial have announced a merger, with Fentura merging into ChoiceOne, which will continue as the surviving entity, enhancing their market position in Michigan [1][2]. Company Overview - ChoiceOne Financial Services, Inc. is headquartered in Sparta, Michigan, and operates as a financial holding company with approximately $2.6 billion in assets, making it the eighth largest bank holding company in Michigan [3]. - Fentura Financial, Inc. is the holding company for The State Bank, which operates 21 offices across several counties in Michigan and focuses on community engagement and customer service [4]. Merger Details - Shareholders from both companies approved the merger on December 12, 2024, with the transaction expected to close in the first quarter of 2025, pending regulatory approvals [1][2]. - Post-merger, the combined entity will have approximately $4.3 billion in assets and 56 offices, positioning it as the third largest publicly traded bank holding company in Michigan based on asset size [2]. Strategic Implications - The merger is anticipated to create efficiencies and new growth opportunities due to limited overlap and disruption between the two organizations [2]. - Both CEOs expressed confidence that the merger will enhance value for shareholders and strengthen community engagement [2].

Financial Performance - ChoiceOne reported net income of $7,348,000 for Q3 2024, a 43.5% increase from $5,122,000 in Q3 2023, and $19,568,000 for the nine months ended September 30, 2024, up 22.5% from $15,968,000 in the same period last year [149]. - The annualized return on average assets was 1.09% for Q3 2024, compared to 0.80% for Q3 2023, while the return on average shareholders' equity was 12.36%, up from 11.31% in the same period last year [153]. - Adjusted diluted earnings per share were $0.93 for Q3 2024, compared to $0.68 in Q3 2023, reflecting the impact of the common stock offering [149]. - Noninterest income increased by $2.1 million for the nine months ended September 30, 2024, primarily due to an increase in customer service charges [181]. - Noninterest expense increased by $2.1 million or 5.0% for the nine months ended September 30, 2024, compared to the same period in 2023 [183]. Assets and Liabilities - Total assets increased to $2.7 billion as of September 30, 2024, reflecting a growth of $149.3 million compared to December 31, 2023, primarily due to a $74.2 million increase in core loans [150]. - Total liabilities rose to $2,650,444,000, up from $2,461,358,000, indicating a growth of approximately 11.6% [160]. - Shareholders' equity increased to $237,875,000 from $181,219,000, reflecting a growth of 31.2% [157]. - Total available for sale securities decreased to $497.6 million as of September 30, 2024, from $514.6 million on December 31, 2023 [187]. - Uninsured deposits amounted to $863.3 million or 39.1% of total deposits as of September 30, 2024, up from $769.7 million or 36.3% at the end of 2023 [199]. Loans and Interest Income - Average loans increased to $1,436,277,000 with an interest income of $66,051,000, resulting in an interest rate of 6.14% [159]. - Net interest income (tax-equivalent basis) increased to $56,258,000 from $50,487,000, representing a growth of 14% year-over-year [159]. - Net interest margin (tax-equivalent basis) improved to 3.00% compared to 2.87% in the previous year [159]. - Average loan balances increased to $1.46 billion in Q3 2024, up from $1.36 billion in Q4 2023 and $1.28 billion in Q3 2023, with core loans growing by $74.2 million or 7.1% on an annualized basis [192]. - Tax-equivalent net interest income increased by $5.8 million for the nine months ended September 30, 2024, compared to the same period in 2023 [166]. Deposits and Funding - Deposits, excluding brokered deposits, rose by $102.1 million or an annualized 19.5% in Q3 2024, driven by public funds, and increased by $103.0 million or 4.9% compared to December 31, 2023 [151]. - The cost of deposits to average total deposits increased to an annualized 1.53% in Q3 2024 from 1.36% in Q3 2023, influenced by the Federal Reserve's rate changes [152]. - Total cost of funds increased to an annualized 1.87% in Q3 2024, compared to 1.70% in Q3 2023 [201]. - ChoiceOne experienced $86.2 million in deposit growth in the first nine months of 2024, compared to a decrease of $15.2 million in the same period in 2023 [210]. Mergers and Capital - ChoiceOne completed a public offering of 1,380,000 shares at $25.00 per share, raising approximately $34.5 million to support regulatory capital ratios and the merger with Fentura Financial [146]. - The merger with Fentura Financial is expected to create the third largest publicly traded bank in Michigan with approximately $4.3 billion in total assets and 56 offices, anticipated to close in Q1 2025 [148]. - ChoiceOne's total capital to risk-weighted assets ratio was 15.0% as of September 30, 2024, exceeding the minimum required for capital adequacy purposes of 8.0% [206]. - Common equity Tier 1 capital to risk-weighted assets for ChoiceOne Bank is 212.3 million, or 11.8% [208]. Credit Quality - The provision for credit losses on loans was $1.1 million during the first nine months of 2024, compared to $332,000 in the same period in the prior year [179]. - Nonperforming loans increased to $2.9 million as of September 30, 2024, compared to $1.8 million as of September 30, 2023 [177]. Cash Flow and Liquidity - Net cash provided by operating activities decreased to $25.0 million for the nine months ended September 30, 2024, down from $57.3 million in the same period in 2023 [210]. - Net cash used in investing activities was $56.3 million for the nine months ended September 30, 2024, compared to $96.1 million in the same period in 2023 [210]. - Outstanding borrowings from the BTFP amounted to $170.0 million as of September 30, 2024 [212]. - Total available borrowing capacity from the FHLB and the Federal Reserve Bank was $780.6 million as of September 30, 2024 [212]. - Management believes that capital levels as of September 30, 2024, are adequate for the foreseeable future [208].

分组1 - ChoiceOne Financial Services, Inc. reported quarterly earnings of $0.93 per share, exceeding the Zacks Consensus Estimate of $0.74 per share, and up from $0.68 per share a year ago, representing an earnings surprise of 25.68% [1] - The company posted revenues of $25.12 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 8.72%, compared to $19.93 million in the same quarter last year [1] - Over the last four quarters, ChoiceOne Financial Services has consistently surpassed consensus EPS and revenue estimates [1] 分组2 - The stock has gained approximately 5.8% since the beginning of the year, while the S&P 500 has increased by 22.7% [2] - The current consensus EPS estimate for the upcoming quarter is $0.79 on revenues of $23.4 million, and for the current fiscal year, it is $3.06 on revenues of $89.4 million [4] - The Zacks Industry Rank for Financial - Miscellaneous Services is in the bottom 41% of over 250 Zacks industries, indicating potential challenges for stock performance [5]