Lake Shore Bancorp(LSBK) - 2025 Q1 - Quarterly Report

Financial Performance - Total interest income for Q1 2025 was $8,367,000, a decrease of 2.8% from $8,609,000 in Q1 2024[13] - Net interest income after provision for credit losses was $5,417,000, slightly down from $5,485,000 in the same period last year[13] - Non-interest income increased to $724,000 in Q1 2025, up from $707,000 in Q1 2024, representing a growth of 2.4%[13] - Net income for Q1 2025 was $1,057,000, compared to $1,014,000 in Q1 2024, reflecting a growth of 4.2%[13] - Basic and diluted earnings per share increased to $0.19 in Q1 2025, up from $0.17 in Q1 2024[13] - Total comprehensive income for Q1 2025 was $1,070,000, significantly higher than $216,000 in Q1 2024[14] - Other Comprehensive Income for Q1 2025 was $13,000, a significant recovery from a loss of $798,000 in Q1 2024[14] Expenses and Dividends - Total non-interest expense decreased to $4,878,000 in Q1 2025, down from $4,995,000 in Q1 2024, a reduction of 2.4%[13] - Cash dividends declared per share were $0.18 in Q1 2025, compared to no dividends declared in Q1 2024[13] Credit Losses and Provisions - The provision for credit losses was $48,000 in Q1 2025, a reversal from a credit loss of $352,000 in Q1 2024[13] - The allowance for credit losses increased by $37,000 for loans and $9,000 for unfunded commitments as of March 31, 2025, compared to December 31, 2024[30] - The provision for credit losses for the three months ended March 31, 2025, was $39 thousand, while for the same period in 2024, it was a negative $223 thousand, indicating a significant shift in credit quality assessment[55] - The total allowance for credit losses on loans was $5,170 thousand as of March 31, 2025, compared to $6,463 thousand on March 31, 2024, reflecting a decrease of about 20%[55] Loans and Deposits - Net increase in deposits was $9,752,000, up from $3,780,000 in the previous year[18] - As of March 31, 2025, the company's total gross loans amounted to $553.6 million, an increase from $546.5 million as of December 31, 2024, representing a growth of approximately 1.9%[45] - The company's real estate loans totaled $528.7 million as of March 31, 2025, slightly down from $529.8 million as of December 31, 2024, indicating a decrease of about 0.2%[45] - The total gross loans receivable as of March 31, 2025, was $553,631,000, showing a slight increase from $546,490,000 as of December 31, 2024[61] Cash Flow and Investments - Net cash provided by operating activities was $718,000, compared to a net cash used of $32,000 in the prior year[18] - The company reported a net cash used in investing activities of $5,601,000, a significant decrease from $8,411,000 in the same period of 2024[18] - Cash and cash equivalents at the end of the period were $30,428,000, down from $54,953,000 at the end of the same period in 2024[18] - Interest paid during the period was $2,918,000, a decrease from $3,979,000 in the prior year[18] Securities and Fair Value - Total debt securities available for sale had a fair value of $55,681,000, with unrealized losses of $12,620,000[36] - The estimated fair value of total securities as of March 31, 2025, was $55,801,000, compared to $56,495,000 as of December 31, 2024[98] - The fair value of municipal bonds pledged as collateral for customer deposits was $3.8 million as of March 31, 2025, down from $4.6 million as of December 31, 2024[39] - The company recognized an unrealized gain of $46,000 on equity securities during the three months ended March 31, 2025, compared to an unrealized gain of $11,000 during the same period in 2024[44] Stock and Compensation - Stock-based compensation costs for the three months ended March 31, 2025, were $120,000, compared to $38,000 for the same period in 2024[80] - The 2025 Equity Incentive Plan was approved on February 4, 2025, allowing for the issuance of up to 300,000 shares of common stock[88] - A total of 27,197 restricted stock awards were granted under the 2025 EIP at a fair value of $15.77 per share[89] - The ESOP compensation expense was $31,000 for the three months ended March 31, 2025, compared to $23,000 for the same period in 2024[91] Credit Quality and Loan Classification - The company classified its loans into categories such as Pass, Special Mention, Substandard, Doubtful, and Loss, with a focus on monitoring credit quality indicators monthly[65][67] - The total gross loans classified as Pass for residential, one- to four-family loans was $156,198,000 as of March 31, 2025[68] - Non-accrual loans totaled $3,804 thousand as of March 31, 2025, compared to $3,472 thousand on December 31, 2024, marking an increase of approximately 9.5%[60] Miscellaneous - The company is transitioning to a fully-public stock holding company structure, with the SEC declaring the New Bank Holding Company's Registration Statement effective on May 14, 2025[32] - The company had no foreclosed real estate as of March 31, 2025, and December 31, 2024[75] - The company did not sell any debt securities during the three months ended March 31, 2025, and 2024[43]