First Savings Financial (FSFG) - 2025 Q3 - Quarterly Report

Part I Financial Information Financial Statements The unaudited condensed consolidated financial statements detail the company's financial position, operations, and cash flows, reflecting asset shifts and income growth Condensed Consolidated Balance Sheets Total assets slightly decreased to $2.42 billion by June 30, 2025, driven by reduced net loans, while liabilities shifted from deposits to FHLB borrowings Condensed Consolidated Balance Sheets | Item | June 30, 2025 ($ in thousands) | September 30, 2024 ($ in thousands) | | :--- | :--- | :--- | | Total Assets | $2,416,675 | $2,450,368 | | Loans, net | $1,895,821 | $1,963,852 | | Debt securities available for sale | $243,411 | $248,679 | | Total cash and cash equivalents | $52,123 | $52,142 | | Total Liabilities | $2,232,853 | $2,273,253 | | Total deposits | $1,736,194 | $1,880,881 | | Federal Home Loan Bank borrowings | $434,924 | $301,640 | | Total Stockholders' Equity | $183,822 | $177,115 | Condensed Consolidated Statements of Income Net income significantly increased for both the three and nine-month periods ended June 30, 2025, driven by higher net interest and noninterest income Condensed Consolidated Statements of Income | Item | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Nine Months Ended June 30, 2025 ($ in thousands) | Nine Months Ended June 30, 2024 ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | | Net interest income | $16,725 | $14,534 | $48,178 | $42,985 | | Total noninterest income | $4,520 | $3,196 | $14,183 | $9,688 | | Total noninterest expense | $13,693 | $12,431 | $42,334 | $40,248 | | Net Income | $6,166 | $4,073 | $17,890 | $9,920 | | Diluted EPS | $0.88 | $0.60 | $2.57 | $1.45 | Condensed Consolidated Statements of Comprehensive Income Comprehensive income for the nine months ended June 30, 2025, was $9.0 million, significantly impacted by unrealized losses on available-for-sale securities Condensed Consolidated Statements of Comprehensive Income | Item | Three Months Ended June 30, 2025 ($ in thousands) | Nine Months Ended June 30, 2025 ($ in thousands) | | :--- | :--- | :--- | | Net Income | $6,166 | $17,890 | | Other Comprehensive Income (Loss) | $(676) | $(8,866) | | Comprehensive Income | $5,490 | $9,024 | Condensed Consolidated Statements of Changes in Stockholders' Equity Stockholders' equity increased to $183.8 million by June 30, 2025, driven by net income, partially offset by comprehensive loss and dividends - Key drivers for the change in stockholders' equity over the nine months ended June 30, 2025 include: - Net income: +$17.9 million[12] - Other comprehensive loss: -$8.9 million[12] - Common stock dividends paid: -$3.3 million[12] Condensed Consolidated Statements of Cash Flows Cash and cash equivalents remained stable for the nine months ended June 30, 2025, with operating outflows offset by investing inflows from loan sales Condensed Consolidated Statements of Cash Flows | Item | Nine Months Ended June 30, 2025 ($ in thousands) | Nine Months Ended June 30, 2024 ($ in thousands) | | :--- | :--- | :--- | | Net Cash Provided by (Used in) Operating Activities | $(26,155) | $89,979 | | Net Cash Provided by (Used In) Investing Activities | $60,800 | $(167,069) | | Net Cash Provided by (Used In) Financing Activities | $(34,664) | $88,668 | | Net Increase (Decrease) in Cash and Cash Equivalents | $(19) | $11,578 | Notes to Condensed Consolidated Financial Statements The notes detail accounting policies, financial statement components, including ACL methodology, investment and loan portfolios, and segment performance Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial performance, highlighting substantial net income growth, a strategic shift in funding, and a strong 'well-capitalized' regulatory position Comparison of Financial Condition Net loans decreased by $68.0 million due to a bulk sale, while deposits declined and FHLB borrowings increased to manage funding - Net loans receivable decreased by $68.0 million, primarily due to the transfer and subsequent bulk sale of approximately $87.2 million of residential real estate home equity line of credit loans[190] - Total deposits decreased by $144.7 million, driven by a $229.1 million reduction in brokered deposits[194] - Borrowings from the FHLB increased by $133.3 million, utilized in place of the decreased brokered deposits[196] Results of Operations for the Three Months Ended June 30, 2025 and 2024 Net income for Q3 2025 significantly increased to $6.2 million, driven by higher net interest income and expanded tax-equivalent net interest margin - Net income increased to $6.2 million ($0.88 per diluted share) for Q3 2025, compared to $4.1 million ($0.60 per diluted share) for Q3 2024[198] - Net interest income increased by $2.2 million (15.1%) year-over-year, with the tax-equivalent net interest margin improving to 2.99% from 2.67%[199] - Noninterest income increased by $1.3 million, primarily due to a $617,000 gain on sale of home equity lines of credit and a $565,000 gain from a lease termination[210] Results of Operations for the Nine Months Ended June 30, 2025 and 2024 Net income for the nine months ended June 30, 2025, rose to $17.9 million, driven by increased net interest and noninterest income, and a credit for credit losses - Net income for the nine-month period was $17.9 million ($2.57 per diluted share), up from $9.9 million ($1.45 per diluted share) in the prior year[215] - Net interest income increased by $5.2 million (12.1%), with the tax-equivalent net interest margin expanding to 2.89% from 2.67%[216] - A net credit for credit losses of $263,000 was recorded, compared to a $1.6 million provision in the prior year, primarily due to the bulk sale of $87.2 million of home equity loans[226] - Noninterest income increased by $4.5 million, driven by a $3.1 million gain on sale of home equity lines of credit and a $403,000 gain on sale of equity securities[228] Liquidity and Capital Resources The company maintains strong liquidity through diverse funding sources and remains 'well-capitalized' with substantial borrowing capacity as of June 30, 2025 - Primary sources of funds include customer deposits, loan repayments, maturing securities, and FHLB borrowings[233] - At June 30, 2025, the Bank had total borrowing capacity of $800.0 million from the FHLB, with $434.9 million outstanding[233] - As of June 30, 2025, the Bank was categorized as 'well-capitalized' under regulatory guidelines, with a total capital to risk-weighted assets ratio of 12.47%, exceeding the 10.0% requirement[238] Quantitative and Qualitative Disclosures About Market Risk The company manages interest rate risk using a Net Interest Income at Risk model, projecting a 4.56% decrease in NII for a 100bp rate increase Projected Change in Net Interest Income | Immediate Change in Interest Rates (bp) | Projected % Change in Net Interest Income (1-Year Horizon) | | :--- | :--- | | +300bp | (12.38)% | | +200bp | (8.47)% | | +100bp | (4.56)% | | -100bp | 5.18% | | -200bp | 10.34% | Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures were effective as of June 30, 2025[252] - No material changes in internal control over financial reporting occurred during the three months ended June 30, 2025[253] Part II Other Information Legal Proceedings As of June 30, 2025, the company is not involved in any legal proceedings expected to materially impact its financial condition or operations - The Company is not a party to any legal proceedings that would require disclosure or have a material adverse effect on its financial condition[256] Risk Factors No material changes have occurred to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended September 30, 2024 - No material changes have occurred to the risk factors described in the Annual Report on Form 10-K for the year ended September 30, 2024[257] Unregistered Sales of Equity Securities, Use of Proceeds, And Issuer Purchases of Equity Securities During Q3 2025, the company repurchased 1,428 shares of common stock at an average price of $27.64 under its repurchase program Issuer Purchases of Equity Securities | Period | Total Shares Purchased | Average Price Paid per Share ($) | | :--- | :--- | :--- | | April 2025 | — | $— | | May 2025 | 1,428 | $27.64 | | June 2025 | — | $— | | Total | 1,428 | $27.64 | Other Information No directors or executive officers adopted or terminated Rule 10b5-1 trading plans during the three months ended June 30, 2025 - No directors or executive officers adopted or terminated any Rule 10b5-1 trading plans during the three months ended June 30, 2025[263] Exhibits The report includes various exhibits filed with Form 10-Q, such as CEO/CFO certifications and XBRL interactive data files