Affinity Bancshares(AFBI) - 2025 Q4 - Annual Report

Financial Performance - Net income rose by $2.9 million, or 53.1%, to $8.3 million for the year ended December 31, 2025, compared to $5.4 million for the year ended December 31, 2024[188]. - Net income increased by $2.9 million, or 53.1%, to $8.3 million for the year ended December 31, 2025, compared to $5.4 million for 2024[208]. - Noninterest income decreased by $91,000, or 4.5%, to $1.9 million for the year ended December 31, 2025[218]. - Income tax expense increased to $2.9 million for the year ended December 31, 2025, compared to $1.5 million for 2024, attributed to increased income before income taxes[221]. Asset and Liability Management - Total assets increased by $14.9 million, or 1.7%, to $881.7 million at December 31, 2025, from $866.8 million at December 31, 2024[187]. - Gross loans increased by $28.6 million, or 4.0%, to $742.7 million at December 31, 2025, with consumer loans rising by $15.2 million, or 12.6%[197]. - Total deposits increased by $21.5 million, or 3.2%, to $695.0 million at December 31, 2025, with savings accounts growing by $20.9 million, or 27.5%[199]. - Cash and cash equivalents increased by $12.4 million, or 30.0%, to $53.9 million at December 31, 2025, primarily due to deposit growth[196]. - The loan-to-deposit ratio at December 31, 2025, was 106.9%, compared to 106.0% at December 31, 2024[199]. - The company had outstanding commitments to originate loans of $72.0 million as of December 31, 2025[237]. Interest Income and Expenses - Interest income increased by $3.0 million, or 6.3%, to $51.0 million for the year ended December 31, 2025, driven by a $3.5 million increase in interest income on loans[188]. - Interest income rose by $3.0 million, or 6.3%, to $51.0 million for the year ended December 31, 2025, from $48.0 million in 2024[209]. - Interest expense increased by $1.1 million, or 5.7%, to $19.9 million for the year ended December 31, 2025[212]. - Net interest income before provision for credit losses increased by $2.0 million, or 6.8%, to $31.1 million for the year ended December 31, 2025[215]. - Total interest-earning assets increased by $45.2 million, or 5.5%, to $868.0 million for the year ended December 31, 2025[215]. - Net interest margin was 3.59% for the year ended December 31, 2025, compared to 3.54% for 2024[215]. Expenses and Efficiency - Noninterest expenses decreased by $2.1 million, or 8.7%, to $21.7 million for the year ended December 31, 2025[188]. - Non-interest expenses decreased by $2.1 million, or 8.7%, to $21.7 million for the year ended December 31, 2025, from $23.8 million for 2024, primarily due to a decrease in other expenses, specifically merger-related expenses[220]. - Total non-interest expenses included salaries and employee benefits of $12.904 million, a decrease of 1.7% from $13.126 million in 2024[220]. Capital and Liquidity - Stockholders' equity decreased by $2.1 million, or 1.6%, to $127.0 million at December 31, 2025, impacted by $8.8 million in dividends paid and $5.9 million in common stock repurchases[201]. - The company maintained a liquidity ratio of 12.0% or greater, with compliance at December 31, 2025, and 2024[231]. - The company is categorized as well capitalized and exceeded all regulatory capital requirements as of December 31, 2025[236]. Risk Management - Provision for credit losses recorded was $125,000 for the year ended December 31, 2025, compared to $438,000 for 2024[217]. - Allowance for credit losses to total loans was 1.21% at December 31, 2025, compared to 1.19% at December 31, 2024[217]. - The estimated net interest income for a 400 basis point increase in interest rates is projected to be $29.935 million, reflecting an 8.27% decrease from the current level[228]. - The company does not engage in hedging activities such as futures or options, focusing instead on managing interest rate risk through various strategies[224]. Borrowings - The company had a $50.6 million line of credit with the Federal Home Loan Bank of Atlanta, with $54.0 million in borrowings as of December 31, 2025[231].