Financial Performance - Net income for the three-month period ended December 31, 2024, was $6.2 million, or $0.89 per diluted share, compared to $920,000, or $0.13 per diluted share, for the same period in 2023[193]. - Net interest income increased by $1.3 million, or 9.6%, for the three-month period ended December 31, 2024, compared to the same period in 2023[194]. - Noninterest income increased by $3.3 million for the three-month period ended December 31, 2024, primarily due to a $2.5 million net gain on the sale of loans[205]. - Noninterest expense decreased by $1.1 million for the three-month period ended December 31, 2024, compared to the same period in 2023, primarily due to reductions in compensation and benefits, occupancy and equipment, and professional fee expenses[207]. - The Company recognized an income tax expense of $848,000 for the three-month period ended December 31, 2024, compared to an income tax benefit of $476,000 for the same period in 2023, with an effective tax rate of 12.0%[208]. Balance Sheet Changes - Cash and cash equivalents increased by $24.1 million from $52.1 million at September 30, 2024, to $76.2 million at December 31, 2024[184]. - Net loans receivable decreased by $79.3 million, from $1.96 billion at September 30, 2024, to $1.88 billion at December 31, 2024, primarily due to a $87.2 million bulk sale of residential real estate home equity line of credit loans[184]. - Total deposits decreased by $48.1 million from $1.88 billion at September 30, 2024, to $1.83 billion at December 31, 2024[188]. - Stockholders' equity decreased by $1.1 million from $177.1 million at September 30, 2024, to $176.0 million at December 31, 2024[192]. - As of December 31, 2024, the Bank had cash and cash equivalents of $76.2 million and securities available-for-sale with a fair value of $241.6 million, including $130.3 million that are unpledged[209]. - As of December 31, 2024, deposits exceeding the FDIC insurance limit of $250,000 per insured account were estimated to be $570.4 million, or 31.1% of total deposits[211]. Capital and Borrowing - The Bank maintained Tier 1 capital ratio of 9.33%, common equity Tier 1 capital ratio of 11.93%, and total capital ratio of 13.01% as of December 31, 2024, all above the regulatory requirements[215]. - The Bank had the ability to borrow a total of $800.0 million from the FHLB, of which $295.0 million was borrowed and outstanding as of December 31, 2024[209]. Interest Rate Risk Management - The Company's net interest income could decrease by $2.4 million, or 3.29%, over a one-year horizon with an immediate and sustained increase in interest rates of 1.00%[226]. - An immediate and sustained decrease in rates of 1.00% would increase net interest income by $2.9 million, or 3.95% over a one-year horizon compared to a flat interest rate scenario[226]. - A 2.00% increase in interest rates would lead to a decrease in net interest income by 6.01%, while a 3.00% increase would result in an 8.68% decrease[226]. - Conversely, a 1.00% decrease in interest rates would increase net interest income by $2.9 million, or 3.95%, over the same period[226]. - The Company aims for long-term profitability while managing interest rate risk through strategies that include shortening the effective maturities of interest-earning assets[221]. - The Company relies primarily on retail deposits as a stable source of funding, which helps mitigate the effects of interest rate fluctuations[221]. - The management utilizes a Net Interest Income at Risk simulation to assess interest rate sensitivity and its impact on projected net interest income[223]. - The Company does not engage in hedging activities or high-risk derivative instruments, minimizing exposure to foreign currency exchange rate risk or commodity price risk[222]. - The Company emphasizes the origination of short-term loans to manage interest rate risk effectively[221]. Internal Controls and Compliance - The Company's management concluded that the disclosure controls and procedures were effective as of December 31, 2024, ensuring timely and accurate reporting[229]. - The internal control over financial reporting is designed to ensure reliability and compliance with U.S. GAAP[230]. - There have been no changes in internal controls over financial reporting that materially affected their effectiveness during the three months ended December 31, 2024[233]. - The Company has not engaged in any off-balance sheet transactions that are reasonably likely to have a material effect on its consolidated financial condition for the three-month period ended December 31, 2024[217].
First Savings Financial (FSFG) - 2025 Q1 - Quarterly Report