Core Viewpoint - Unity Bancorp, Inc. has declared a cash dividend of $0.14 per common share, payable on June 20, 2025, to shareholders of record as of June 6, 2025 [1] Group 1: Company Overview - Unity Bancorp, Inc. is a financial services organization based in Clinton, New Jersey, with approximately $2.8 billion in assets and $2.2 billion in deposits [2] - Unity Bank, the wholly owned subsidiary of Unity Bancorp, provides financial services to retail, corporate, and small business customers through a branch network in various counties in New Jersey and Pennsylvania [2] Group 2: Financial Information - The declared cash dividend of $0.14 per common share reflects the company's ongoing commitment to returning value to its shareholders [1]

[PART I - CONSOLIDATED FINANCIAL INFORMATION](index=5&type=section&id=PART%20I) [Consolidated Financial Statements (Unaudited)](index=5&type=section&id=ITEM%201) This section presents Unity Bancorp, Inc.'s unaudited consolidated financial statements for Q1 2025, highlighting an increase in total assets to **$2.8 billion**, a rise in net income to **$11.6 million**, and growth in loans and deposits [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets%20at%20March%2031%2C%202025%20and%20December%2031%2C%202024) Total assets grew to **$2.77 billion** as of March 31, 2025, up from **$2.65 billion** at year-end 2024, driven primarily by an increase in net loans Consolidated Balance Sheet Highlights (In thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$2,767,943** | **$2,654,017** | | Cash and cash equivalents | $211,593 | $180,438 | | Net loans | $2,317,479 | $2,233,869 | | Total securities | $142,092 | $145,028 | | **Total Liabilities** | **$2,461,801** | **$2,358,434** | | Total deposits | $2,175,398 | $2,100,313 | | Borrowed funds | $243,292 | $220,504 | | **Total Shareholders' Equity** | **$306,142** | **$295,583** | [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income%20for%20the%20three%20months%20ended%20March%2031%2C%202025%20and%202024) For Q1 2025, net income increased to **$11.6 million** from **$9.6 million** in the prior-year period, driven by a **14.3%** increase in net interest income to **$27.3 million** Quarterly Income Statement Highlights (In thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Interest Income | $27,251 | $23,841 | | Provision for credit losses, loans | $1,358 | $641 | | Noninterest Income | $2,101 | $1,718 | | Noninterest Expense | $12,611 | $12,132 | | **Net Income** | **$11,598** | **$9,586** | | **Diluted EPS** | **$1.13** | **$0.93** | [Consolidated Statements of Comprehensive Income](index=7&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20for%20the%20three%20months%20ended%20March%2031%2C%202025%20and%202024) Total comprehensive income for Q1 2025 was **$11.9 million**, compared to **$9.5 million** in Q1 2024, primarily due to higher net income and a smaller other comprehensive loss Quarterly Comprehensive Income (In thousands) | Component | Q1 2025 (Net of tax) | Q1 2024 (Net of tax) | | :--- | :--- | :--- | | Net Income | $11,598 | $9,586 | | Other Comprehensive Income (Loss) | $275 | $(115) | | **Total Comprehensive Income** | **$11,873** | **$9,471** | [Consolidated Statements of Changes in Shareholders' Equity](index=8&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity%20for%20the%20three%20months%20ended%20March%2031%2C%202025%20and%202024) Shareholders' equity increased from **$295.6 million** at year-end 2024 to **$306.1 million** at March 31, 2025, driven by net income and positive other comprehensive income - Key drivers for the change in shareholders' equity in Q1 2025 were net income of **$11.6 million** and other comprehensive income of **$275 thousand**, offset by dividends of **$1.4 million**[13](index=13&type=chunk) - In Q1 2024, the company repurchased **150,000 shares** of treasury stock for **$4.1 million**, with no shares repurchased in Q1 2025[13](index=13&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20three%20months%20ended%20March%2031%2C%202025%20and%202024) For Q1 2025, cash and cash equivalents increased by **$31.2 million**, with net cash provided by operating activities at **$17.9 million** and financing activities at **$96.1 million** Quarterly Cash Flow Summary (In thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $17,854 | $15,762 | | Net cash used in investing activities | $(82,766) | $(3,025) | | Net cash provided by (used in) financing activities | $96,067 | $(24,527) | | **Increase (decrease) in cash and cash equivalents** | **$31,155** | **$(11,790)** | [Notes to the Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) This section provides detailed disclosures on accounting policies, fair value measurements, and portfolio composition, identifying the allowance for credit losses as a significant estimate - The company identifies the allowance for credit losses as a significant estimate, which may be affected by future changes in economic conditions and loan portfolio credit quality[19](index=19&type=chunk) - The company acknowledges risks from macro-economic trends, including interest rate environments and inflation, and notes increased competition for liquidity[21](index=21&type=chunk)[22](index=22&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=47&type=section&id=ITEM%202) Management discusses the company's Q1 2025 financial performance, highlighting a **14.3%** increase in net interest income and a rise in net income to **$11.6 million**, alongside asset quality, liquidity, and capital adequacy [Earnings Summary](index=47&type=section&id=Earnings%20Summary) Net income for Q1 2025 was **$11.6 million** (**$1.13** per diluted share), a significant increase from **$9.6 million** (**$0.93** per diluted share) in Q1 2024 Q1 2025 Performance Highlights vs. Q1 2024 | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income | $11.6 million | $9.6 million | | Diluted EPS | $1.13 | $0.93 | | Return on Average Assets | 1.83% | 1.58% | | Return on Average Equity | 15.56% | 14.49% | | Net Interest Margin | 4.46% | 4.09% | - Net interest income grew **14.3%** year-over-year, primarily due to increased yield and volume on loans[123](index=123&type=chunk) - Noninterest income increased **22.3%** year-over-year, mainly from higher service, loan, and branch fees[123](index=123&type=chunk) [Net Interest Income](index=49&type=section&id=Net%20Interest%20Income) Tax-equivalent net interest income increased by **14.3%** to **$27.3 million** in Q1 2025, with the net interest margin expanding by **37 basis points** to **4.46%** - The increase in net interest income was driven by a **$1.2 million** contribution from higher yields on earning assets and a **$1.7 million** contribution from increased average volume of interest-earning assets[131](index=131&type=chunk) - The average volume of interest-earning assets grew by **$132.5 million**, primarily due to a **$128.6 million** increase in average loans[131](index=131&type=chunk) - Total interest expense decreased by **$0.5 million** (**3.9%**) compared to Q1 2024, mainly due to a lower rate and balance on borrowed funds[133](index=133&type=chunk) [Provision for Credit Losses](index=54&type=section&id=Provision%20for%20Credit%20Losses) The provision for credit losses on loans was **$1.4 million** for Q1 2025, more than double the **$0.6 million** provision in Q1 2024, primarily attributed to loan growth - The provision for credit losses for loans increased to **$1.4 million** in Q1 2025 from **$0.6 million** in Q1 2024, mainly due to loan growth[141](index=141&type=chunk) - The provision for off-balance sheet exposures was a release of **$41 thousand** in Q1 2025, compared to a **$2 thousand** provision in Q1 2024[141](index=141&type=chunk) [Financial Condition](index=55&type=section&id=Financial%20Condition%20at%20March%2031%2C%202025) As of March 31, 2025, total assets grew by **4.3%** to **$2.8 billion** from year-end 2024, primarily fueled by an **$84.5 million** increase in gross loans - Total assets increased by **$113.9 million** (**4.3%**) to **$2.8 billion** at March 31, 2025, compared to year-end 2024[145](index=145&type=chunk) - The asset growth was primarily driven by an **$84.5 million** increase in gross loans and a **$31.2 million** increase in cash and cash equivalents[145](index=145&type=chunk) - Total shareholders' equity increased by **$10.6 million** since year-end 2024, mainly due to retained earnings[146](index=146&type=chunk) [Asset Quality](index=62&type=section&id=Asset%20Quality) Nonaccrual loans increased to **$16.8 million** from **$13.1 million** at year-end 2024, driven by increases in commercial and residential mortgage segments, while potential problem loans also rose slightly - Nonaccrual loans stood at **$16.8 million** at March 31, 2025, an increase of **$3.7 million** from December 31, 2024, but a slight decrease from **$16.9 million** at March 31, 2024[174](index=174&type=chunk) - Potential problem loans, defined as performing but with non-passing risk ratings, totaled **$15.3 million**, up from **$14.6 million** at year-end 2024[177](index=177&type=chunk) [Allowance for Credit Losses and Reserve for Unfunded Loan Commitments](index=64&type=section&id=Allowance%20for%20Credit%20Losses%20and%20Reserve%20for%20Unfunded%20Loan%20Commitments) The allowance for credit losses increased to **$27.7 million** at March 31, 2025, from **$26.8 million** at year-end 2024, with the allowance as a percentage of total loans remaining stable at **1.18%** Allowance for Credit Losses Summary | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Allowance for Credit Losses | $27.7 million | $26.8 million | | Allowance to Total Loans | 1.18% | 1.18% | | Net Charge-offs (Q1) | $0.5 million | N/A | - The reserve for unfunded loan commitments remained stable at **$0.6 million** at March 31, 2025[181](index=181&type=chunk) [Market Risk](index=66&type=section&id=Market%20Risk) The company's primary market risk is interest rate risk, with sensitivity analysis showing a **12.26%** decrease in Economic Value of Equity (EVE) and a **4.33%** decrease in Net Interest Income (NII) in a +200 basis point shock scenario Interest Rate Sensitivity Analysis at March 31, 2025 | Rate Shock (bps) | Change in EVE (%) | Change in NII (%) (12 mo.) | | :--- | :--- | :--- | | +300 | (18.69)% | (6.61)% | | +200 | (12.26)% | (4.33)% | | +100 | (5.71)% | (2.22)% | | -100 | 0.51% | 0.31% | [Liquidity](index=68&type=section&id=Liquidity) The company maintains a strong liquidity position with cash and cash equivalents of **$211.6 million** at March 31, 2025, and significant additional borrowing capacity from FHLB and FRB - Cash and cash equivalents increased by **$31.2 million** during the quarter to **$211.6 million**[198](index=198&type=chunk) - The company had significant additional borrowing capacity: **$276.9 million** from FHLB, **$225.3 million** from the FRB, and **$20.0 million** from other sources[188](index=188&type=chunk)[200](index=200&type=chunk) - Total available funding plus cash on hand was **168.8%** of uninsured or uncollateralized deposits as of March 31, 2025[200](index=200&type=chunk) [Regulatory Capital](index=70&type=section&id=Regulatory%20Capital) Unity Bank continues to exceed all regulatory capital requirements, considered 'well capitalized', with a Total risk-based capital ratio of **15.23%** and a Common Equity Tier 1 (CET1) ratio of **13.98%** as of March 31, 2025 Unity Bank Capital Ratios at March 31, 2025 | Ratio | Actual | Well Capitalized Requirement | | :--- | :--- | :--- | | Common Equity Tier 1 (CET1) | 13.98% | 6.50% | | Tier 1 Risk-Based Capital | 13.98% | 8.00% | | Total Risk-Based Capital | 15.23% | 10.00% | | Tier 1 Leverage | 12.05% | 5.00% | [Shareholders' Equity](index=72&type=section&id=Shareholders%27%20Equity) No shares were repurchased during Q1 2025, leaving **685 thousand** shares available for repurchase under current authorizations, contrasting with **150 thousand** shares repurchased in Q1 2024 - No shares were repurchased in Q1 2025, leaving **684,645 shares** available for repurchase under the authorized plan as of March 31, 2025[202](index=202&type=chunk)[203](index=203&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=47&type=section&id=ITEM%203) There were no significant changes in the company's market risk assessment from its 2024 Form 10-K, with interest rate risk remaining the primary market risk - There were no significant changes in the Company's market risk assessment during Q1 2025[206](index=206&type=chunk) [Controls and Procedures](index=47&type=section&id=ITEM%204) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no significant changes in internal control over financial reporting during the quarter - Management concluded that the Company's disclosure controls and procedures were effective as of March 31, 2025[206](index=206&type=chunk) - No significant changes to internal controls over financial reporting occurred during the quarter[206](index=206&type=chunk) [PART II - OTHER INFORMATION](index=74&type=section&id=PART%20II) [Legal Proceedings](index=74&type=section&id=ITEM%201) The company is subject to ordinary course legal proceedings but is not aware of any that would have a material adverse effect on its business, financial condition, or results of operations - The Company is not aware of any pending legal proceedings that would materially affect its financial position or results[208](index=208&type=chunk) [Risk Factors](index=74&type=section&id=ITEM%201A) No new risk factors are presented in this report, with the company referring to the 'Risk Factors' section within its 2024 Form 10-K - The report refers to the Risk Factors section of the 2024 Form 10-K for information on this item[209](index=209&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=74&type=section&id=ITEM%202) This section refers to the discussion of the company's share repurchase plan under the MD&A section, noting no shares were repurchased during Q1 2025 - No shares were repurchased during the first quarter of 2025[202](index=202&type=chunk)[210](index=210&type=chunk) [Exhibits](index=75&type=section&id=ITEM%206) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL data files - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Sections 302 and 906[211](index=211&type=chunk)[213](index=213&type=chunk)

Core Insights - Unity Bank has been recognized as one of the top-performing small banks in the United States by the Hovde Group, marking the third consecutive year of inclusion in the high-performer list, indicating strong financial management and customer service [1][3]. Group 1: Performance Recognition - The Hovde Group's 2025 report evaluates small banks with market capitalizations between $100 million and $1.5 billion, ranking them based on financial metrics such as pre-tax pre-provision net revenue, efficiency ratios, loan and deposit growth, tangible book value growth, and employee productivity [2]. - Unity Bank's recognition reflects the strength of its strategic approach, employee dedication, and customer trust, emphasizing a focus on long-term, responsible growth [3]. Group 2: Company Overview - Unity Bancorp, Inc. (NASDAQ:UNTY) is the parent company of Unity Bank, which operates 21 branches across New Jersey and the Lehigh Valley, Pennsylvania, providing community-focused commercial banking services [5].

Core Insights - Unity Bank has been recognized as one of the top-performing small banks in the United States by the Hovde Group, marking the third consecutive inclusion in the annual high-performer list, indicating sustained excellence in financial management and customer service [1][3] Group 1: Performance Recognition - The Hovde Group's 2025 report evaluates small banks with market capitalizations between $100 million and $1.5 billion, ranking them based on key financial metrics such as pre-tax pre-provision net revenue, efficiency ratios, loan and deposit growth, tangible book value growth, and employee productivity [2] - Unity Bank's recognition reflects the consistent strength of its strategy, employee dedication, and customer trust, reinforcing a focus on long-term, responsible growth [3] Group 2: Company Overview - Unity Bancorp, Inc. (NASDAQ: UNTY) is the parent company of Unity Bank, which operates 21 branches across New Jersey and the Lehigh Valley, Pennsylvania, providing community-focused commercial banking services including deposit accounts, loans, and digital services [5]

Core Insights - Unity Bancorp reported revenue of $29.35 million for the quarter ended March 2025, reflecting a year-over-year increase of 14.8% [1] - Earnings per share (EPS) for the quarter was $1.13, up from $0.93 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $28.57 million by 2.74%, while the EPS also surpassed the consensus estimate of $1.12 by 0.89% [1] Financial Performance Metrics - Efficiency Ratio stood at 42.9%, slightly better than the average estimate of 43.2% from two analysts [4] - Average Earning Assets were reported at $2.48 billion, compared to the average estimate of $2.46 billion [4] - Net interest margin was 4.5%, exceeding the estimated 4.4% [4] - Total Noninterest Income reached $2.10 million, surpassing the average estimate of $1.95 million [4] - Net Interest Income was reported at $27.25 million, above the average estimate of $26.63 million [4] Stock Performance - Unity Bancorp's shares have returned -6.2% over the past month, compared to a -6.1% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Unity Bancorp (UNTY) came out with quarterly earnings of $1.13 per share, beating the Zacks Consensus Estimate of $1.12 per share. This compares to earnings of $0.93 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 0.89%. A quarter ago, it was expected that this bank holding company would post earnings of $1.08 per share when it actually produced earnings of $1.13, delivering a surprise of 4.63%.Over the last four quarters, the ...

Financial Performance - Net income for the quarter ended March 31, 2025, was $11.6 million, a 0.8% increase from $11.5 million for the quarter ended December 31, 2024[1]. - Net income for the period was $11,598,000, reflecting a slight increase of 0.8% from $11,505,000 in the previous quarter and a significant increase of 21.0% from $9,586,000 year-over-year[12]. - Net income for Q1 2025 was $11,598,000, slightly up from $11,505,000 in Q4 2024, representing an increase of 0.81%[22]. - Basic net income per common share was $1.15, unchanged from the previous quarter and up from $0.95 year-over-year[12]. Interest Income and Margin - Net interest income increased to $27.3 million for the quarter ended March 31, 2025, up from $26.5 million, with a net interest margin of 4.46%, an increase of 9 basis points[2]. - Total interest income for the three months ended March 31, 2025, was $40,801,000, an increase of 1.3% compared to $40,264,000 for the previous quarter and a 7.5% increase from $37,937,000 year-over-year[12]. - Net interest income after provision for credit losses was $25,934,000, up 3.0% from $25,190,000 in the previous quarter and 11.8% from $23,198,000 year-over-year[12]. - The company reported a net interest margin for the quarter ended March 31, 2025, indicating a focus on maintaining profitability through interest income strategies[14]. - The net interest margin improved to 4.46% for the three months ended March 31, 2025, compared to 4.09% for the same period in 2024[15]. Loans and Deposits - Total gross loans rose by $84.5 million, or 3.7%, from December 31, 2024, primarily due to growth in commercial and mortgage loans[2]. - Total loans increased to $2,345,130,000 in Q1 2025 from $2,260,657,000 in Q4 2024, marking a growth of 3.73%[22]. - Total deposits increased by $75.1 million, or 3.6%, from December 31, 2024, with 20.0% of total deposits being uninsured or uncollateralized[2]. - Total deposits rose to $2,175,398,000 in Q1 2025 from $2,100,313,000 in Q4 2024, reflecting a growth of 3.57%[22]. Asset Growth - Total assets increased by 4.3% to $2,767,943,000 compared to $2,654,017,000 in the previous quarter[10]. - Total assets increased to $2,565,324,000 as of March 31, 2025, compared to $2,436,735,000 on March 31, 2024, reflecting a growth of 5.3%[15]. Equity and Retained Earnings - Shareholders' equity increased to $306.1 million as of March 31, 2025, compared to $295.6 million at the end of the previous quarter[2]. - Total shareholders' equity grew by 3.6% to $306,142,000 compared to $295,583,000[10]. - Retained earnings increased by 4.5% to $237,518,000 from $227,331,000[10]. - Total shareholders' equity increased to $302,292,000 as of March 31, 2025, up from $266,148,000 a year earlier, reflecting a growth of 13.6%[15]. Noninterest Income and Expenses - Noninterest income was $2.1 million for the quarter ended March 31, 2025, compared to $1.9 million for the previous quarter, driven by increased service and loan fee income[2]. - Total noninterest income rose to $2,101,000, a 9.7% increase from $1,916,000 in the previous quarter and a 22.3% increase from $1,718,000 year-over-year[12]. - Total noninterest expense remained stable at $12,611,000, a slight decrease from $12,617,000 in the previous quarter but an increase of 3.9% from $12,132,000 year-over-year[12]. Credit Quality - The allowance for credit losses as a percentage of gross loans was 1.18% as of March 31, 2025[2]. - Nonaccrual assets increased to $18.0 million as of March 31, 2025, compared to $15.0 million as of December 31, 2024[6]. - Provision for credit losses on loans was $1,358,000, a significant increase of 188.9% compared to $470,000 in the previous quarter and up 111.9% from $641,000 year-over-year[12]. - Nonaccrual loans to total loans ratio increased to 0.72% in Q1 2025 from 0.58% in Q4 2024, showing a deterioration in loan quality[22]. - The allowance for credit losses increased by 3.2% to $27,651,000 from $26,788,000[10]. Ratings and Recognition - Unity Bank received a 5-Star Superior rating from BauerFinancial in March 2025, indicating strong performance in capital, loan quality, and profitability[4].

Financial Performance - Unity Bancorp, Inc. reported net income of $11.6 million, or $1.13 per diluted share, for Q1 2025, reflecting a 0.8% increase from the previous quarter's net income of $11.5 million [1] - The company achieved a return on assets (ROA) of 1.83% and a return on equity (ROE) of 15.56% [2] Lending and Deposits - Commercial and residential lending saw strong originations, with loans increasing by $84.5 million, a 3.74% rise from year-end [3] - Customer deposits (excluding brokered deposits) grew by $90.7 million, or 4.82%, quarter over quarter [3] Strategic Outlook - The company aims to manage its balance sheet diligently, focusing on funding future credit growth through deposit growth [3] - Unity Bancorp remains committed to disciplined credit-risk management, including conservative underwriting practices and proactive management of delinquency and non-performing assets [3] Market Context - Despite capital market volatility due to tariffs, Unity Bancorp does not anticipate adverse impacts on loan demand, with some small business customers potentially benefiting from tariffs on foreign goods [4] - The company emphasizes its role as a trusted advisor to customers facing challenges, reinforcing its commitment to local economic development [4] Company Overview - Unity Bancorp, Inc. is headquartered in Clinton, New Jersey, with approximately $2.8 billion in assets and $2.2 billion in deposits [5] - Unity Bank, the wholly owned subsidiary, serves retail, corporate, and small business customers through a robust branch network across several counties in New Jersey and Pennsylvania [5]

Core Insights - Unity Bancorp, Inc. reported a net income of $11.6 million, or $1.13 per diluted share, for Q1 2025, reflecting a 0.8% increase from the previous quarter [1][2] Financial Performance - The company achieved a return on assets (ROA) of 1.83% and a return on equity (ROE) of 15.56% [2] - Commercial and residential lending saw strong originations, with loans increasing by $84.5 million, a 3.74% rise from year-end [3] - Customer deposits (excluding brokered deposits) grew by $90.7 million, or 4.82%, quarter over quarter [3] Strategic Focus - Unity Bancorp aims to manage its balance sheet diligently, planning to fund future credit growth through deposit growth [3] - The company emphasizes disciplined credit-risk management, focusing on conservative loan-to-value and debt-service-coverage levels [3] - Unity Bancorp remains committed to supporting local economic development and providing financial services to its communities [4] Market Context - Despite capital market volatility due to tariffs, Unity Bancorp does not anticipate adverse impacts on loan demand [4] - The company is prepared to assist small business customers who may benefit from tariffs on foreign goods [4] Company Overview - Unity Bancorp, Inc. is headquartered in Clinton, New Jersey, with approximately $2.8 billion in assets and $2.2 billion in deposits [5] - Unity Bank, the wholly owned subsidiary, serves retail, corporate, and small business customers through a robust branch network in New Jersey and Pennsylvania [5]

Financial Performance - Net income for the year ended December 31, 2024, totaled $41.5 million, a 4.4% increase from $39.7 million in 2023[166] - Noninterest income was $8.5 million, a 4.0% increase compared to $8.1 million in the prior year[167] - The effective tax rate decreased to 23.8% from 25.1% in the prior year[170] - Noninterest expense totaled $48.7 million, an increase of $1.7 million compared to the prior year[170] - Total comprehensive income for 2024 was $55,220, compared to $53,665 in 2023, reflecting a 2.9% increase[291] - The company declared dividends of $0.52 per share in 2024, up from $0.48 per share in 2023[292] Interest Income and Margin - Net interest income increased by $3.6 million, or 3.8%, to $98.6 million, primarily due to higher yields on interest-earning assets[167] - The net interest margin increased by 10 basis points to 4.16% for the year ended December 31, 2024[167] - Net interest income on a fully tax-equivalent basis was $98.6 million for 2024, compared to $95.0 million in 2023, reflecting an increase in net interest margin to 4.16%[185] - Total interest income for 2024 increased to $155,738, up 8.5% from $143,494 in 2023[290] Loans and Credit Quality - Total gross loans rose by $88.6 million, or 4.1%, driven by a 10.5% increase in commercial loans[170] - The provision for credit losses for loans increased to $2.4 million in 2024 from $1.8 million in 2023, attributed to loan growth[186] - Nonaccrual loans decreased to $13.1 million at December 31, 2024, down from $18.2 million at year-end 2023, representing a reduction of $5.1 million[235] - The allowance for credit losses increased to $26.8 million at December 31, 2024, compared to $25.9 million at December 31, 2023, with an allowance to total loans ratio of 1.18%[240] - The net charge-offs for 2024 were $1.5 million, a decrease from $2.0 million in 2023, indicating improved asset quality[240] Deposits and Funding - Total deposits increased by $176.2 million, or 9.2%, primarily due to growth in time deposits[170] - Total deposits rose by $176.2 million, or 9.2%, to $2.1 billion at December 31, 2024, driven by increases in time deposits and noninterest-bearing demand deposits[194] - Noninterest-bearing demand deposits accounted for 21.0% of total deposits, while time deposits represented 29.9% as of December 31, 2024[246] - The company reported a 47.4% increase in time deposits from December 31, 2023, reflecting a strategic shift in deposit composition[249] - Total borrowed funds decreased by $135.9 million, or 38.1%, primarily due to customer deposit growth[170] Assets and Equity - Total assets increased by $75.5 million, or 2.9%, to $2.7 billion at December 31, 2024, primarily due to an increase of $88.6 million in gross loans[193] - Total shareholders' equity increased by $34.2 million compared to December 31, 2023, due to earnings and an increase in common stock[195] - Shareholders' equity increased by $34.2 million to $295.6 million as of December 31, 2024, compared to $261.4 million at December 31, 2023, primarily due to net income of $41.5 million[273] Investment Securities - AFS debt securities totaled $93.9 million at December 31, 2024, an increase of $2.1 million or 2.3 percent compared to $91.8 million at December 31, 2023[199] - HTM debt securities amounted to $41.3 million at December 31, 2024, an increase of $5.2 million or 14.3 percent from $36.1 million at December 31, 2023[201] - The fair value of HTM debt securities was $33.8 million at December 31, 2024, compared to $29.7 million at December 31, 2023[201] - The company recorded a valuation allowance of $2.8 million for available-for-sale debt securities as of December 31, 2024, compared to $1.3 million as of December 31, 2023[289] Accounting and Regulatory Compliance - The company adopted the CECL accounting guidance on January 1, 2023, resulting in an increase of $0.8 million in the allowance for credit losses related to loans[282] - The Company maintains a well-capitalized status, exceeding all capital requirements of federal banking regulators as of December 31, 2024[274] - The Company adopted the provisions of ASC 326 effective January 1, 2023, modifying its accounting policy for the allowance for credit losses on loans[330] Cash Flow and Activities - Operating activities generated $47.9 million in net cash for the year ended December 31, 2024, compared to $46.9 million in 2023[264] - Investing activities used $92.8 million in net cash in 2024, an increase from $57.8 million in 2023[265] - Financing activities provided $30.5 million in net cash for 2024, a decrease from $90.9 million in 2023[266]