C&F Financial (CFFI) - 2025 Q4 - Annual Results

Financial Performance - Consolidated net income for Q4 2025 was $6.7 million, up from $6.0 million in Q4 2024, and for the full year 2025, it was $27.0 million, compared to $19.9 million in 2024[2] - Earnings per share increased to $2.07 for Q4 2025 from $1.87 in Q4 2024, and for the year, it rose to $8.29 from $6.01[2] - Net income for the year ended December 31, 2025, was $26,991 million, a significant increase of 35.4% compared to $19,918 million in 2024[33] - Noninterest income for the year ended December 31, 2025, was $26,652 million, compared to $24,474 million in 2024, marking an increase of 8.9%[33] - The annualized return on average assets improved to 0.97% in 2025 from 0.94% in 2024[41] - The annualized return on average tangible common equity was 11.67% in Q4 2025, slightly down from 12.17% in Q4 2024[41] Loan and Deposit Growth - Community banking segment loans grew by $45.3 million, or 11.7% annualized, in Q4 2025, and by $136.7 million, or 9.4%, compared to December 31, 2024[4] - Mortgage banking segment loan originations increased by $55.5 million, or 42.6%, to $186.0 million in Q4 2025, and by $152.5 million, or 28.9%, to $680.2 million for the year[10] - Total loans increased to $2,017,687 million for the year ended December 31, 2025, up from $1,885,643 million in 2024, representing a growth of 7.0%[35] - Total loans in Community Banking increased to $1,590,301 million in 2025 from $1,453,605 million in 2024, representing a growth of 9.4%[37] - Deposits increased by $47.7 million, or 8.3% annualized, in Q4 2025, and by $174.9 million, or 8.1%, compared to December 31, 2024[4] Credit Quality - The community banking segment recorded a provision for credit losses of $250,000 for Q4 2025, compared to no provision in Q4 2024, and a net reversal of provision for credit losses of $50,000 for the year[8] - The allowance for credit losses as a percentage of total loans decreased to 1.10% at December 31, 2025, from 1.20% at December 31, 2024[9] - The provision for credit losses in the community banking segment was $250 million for the quarter ended December 31, 2025, compared to a provision reversal of $(50) million in 2024[33] - Nonaccrual loans in Community Banking increased to $1,135 million in 2025 from $333 million in 2024, resulting in a nonaccrual loans to total loans ratio of 0.07%[37] Capital and Equity - Total equity increased to $262,348 million as of December 31, 2025, from $226,970 million in 2024, indicating a growth of 15.6%[33] - Total borrowings decreased to $113.3 million at December 31, 2025, down from $122.6 million at December 31, 2024[17] - C&F Bank was categorized as well capitalized under the FDIC's regulatory framework as of December 31, 2025, exceeding all required capital ratios[22] - The total risk-based capital ratio for C&F Financial Corporation increased to 15.2% in 2025, compared to 14.1% in 2024, exceeding the minimum requirement of 8.0%[39] - The book value per share rose to $80.64 in 2025 from $70.00 in 2024, indicating a strong growth in equity[39] Dividends and Shareholder Returns - The Corporation declared cash dividends totaling $1.84 per share for the year ended December 31, 2025, representing a payout ratio of 22.2 percent of earnings per share[20] - Dividends declared per share increased to $0.46 in Q4 2025 from $0.44 in Q4 2024, reflecting a commitment to returning value to shareholders[41] Operational Highlights - C&F Bank operates 31 banking offices and five commercial loan offices throughout Virginia, offering full wealth management services[25] - The Corporation had a share repurchase program authorized for up to $5.0 million, but did not make any repurchases during 2025[23] - The Corporation expects to recover its investments in debt securities through scheduled payments of principal and interest despite unrealized losses[21] - Forward-looking statements indicate expectations regarding future financial performance, including trends in yields on loans and deposit growth[29] Interest Income and Margins - Interest income rose to $151,499 million for the year ended December 31, 2025, up from $139,594 million in 2024, reflecting an increase of 8.6%[33] - Consolidated annualized net interest margin was 4.20% for Q4 2025, up from 4.13% in Q4 2024, and 4.21% for the year, compared to 4.12% in 2024[5] - The net interest margin improved to 4.21% for the year ended December 31, 2025, compared to 4.12% in 2024[35] - The average yield on total loans was 6.73% for the year ended December 31, 2025, slightly down from 6.75% in 2024[35]