First Guaranty Bank(FGBI) - 2025 Q1 - Quarterly Report

Financial Performance - First Guaranty recorded a net loss of $6.2 million for the three months ended March 31, 2025, compared to a net income of $2.3 million for the same period in 2024, representing a decrease of $8.5 million [107]. - Total assets decreased by $143.5 million to $3.8 billion at March 31, 2025, a decline of 3.6% from December 31, 2024, driven by decreases in investment securities and net loans [111]. - Total shareholders' equity decreased to $251.4 million at March 31, 2025, down from $255.0 million at December 31, 2024, primarily due to a net loss of $6.2 million [156]. - Net loss for the three months ended March 31, 2025 was $6.2 million, a decrease of $8.5 million from net income of $2.3 million for the same period in 2024 [157]. - Noninterest expense decreased to $18.0 million for the three months ended March 31, 2025, from $18.9 million for the same period in 2024 [176]. Loan and Credit Quality - Total loans decreased to $2.51 billion at March 31, 2025, down $181.0 million or 6.7% from December 31, 2024, continuing the strategy to reduce loan concentration risk [107]. - Nonaccrual loan balances increased to $133.4 million at March 31, 2025, an increase of $24.9 million compared to December 31, 2024, primarily concentrated in two commercial real estate loans [107]. - The provision for credit losses was $14.5 million for the first quarter of 2025, significantly higher than $2.3 million for the same period in 2024, with $5.8 million related to the sale of two commercial real estate loans [107]. - Nonperforming assets totaled $133.9 million, or 3.50% of total assets, an increase of $13.6 million, or 11.3%, from $120.4 million, or 3.03%, at December 31, 2024 [127]. - Nonaccrual loans increased from $108.5 million at December 31, 2024, to $133.4 million at March 31, 2025, with a significant portion concentrated in two commercial real estate relationships totaling $40.3 million [128]. Deposits and Funding - Total deposits decreased by $136.8 million, or 3.9%, to $3.3 billion from December 31, 2024, to March 31, 2025 [143]. - Noninterest-bearing demand deposits increased by $21.6 million, or 5.3%, to $425.6 million at March 31, 2025 [143]. - Interest-bearing demand deposits decreased by $138.4 million, or 10.0%, to $1.2 billion at March 31, 2025 [143]. - Public funds deposits totaled $928.4 million at March 31, 2025, down from $1.0 billion at December 31, 2024 [150]. - The total amount of uninsured deposits was estimated at $294.9 million at March 31, 2025 [146]. Capital and Regulatory Compliance - As of March 31, 2025, the Bank's capital conservation buffer was 4.74%, exceeding the minimum requirement of 2.50% [185]. - The Bank satisfied the minimum regulatory capital requirements and was classified as well capitalized as of March 31, 2025 [188]. - The Tier 1 Risk-based Capital Ratio for the Bank was 8.00% as of March 31, 2025, compared to 11.49% at December 31, 2024 [189]. - The total risk-based capital ratio for the Bank was 10.00% as of March 31, 2025, down from 12.74% at December 31, 2024 [189]. Interest Income and Expense - Net interest income for the three months ended March 31, 2025 was $22.2 million, slightly up from $21.9 million for the same period in 2024 [107]. - Interest income increased by $1.6 million, or 2.9%, to $54.5 million for the three months ended March 31, 2025 compared to the prior year [161]. - Interest income on loans decreased by $3.9 million, or 8.4%, to $43.0 million for the three months ended March 31, 2025 [163]. - Interest expense increased by $1.3 million, or 4.0%, to $32.2 million for the three months ended March 31, 2025 [165]. - The net interest margin was 2.35% for the three months ended March 31, 2025, down from 2.58% for the same period in 2024 [169]. Business Strategy and Operations - First Guaranty declared cash dividends of $0.01 per common share in the first quarter of 2025, a reduction from $0.16 per share in the same period of 2024, as part of a new business strategy to increase capital [109]. - First Guaranty closed three branches and consolidated two existing branches into one location on March 7, 2025, with no material impact on operations [109]. - The company modified its business plan in 2024 to reduce the liability-sensitive nature of its balance sheet [192].