Summit State Bank Reports Net Income of $928,000 for Second Quarter 2024

Core Viewpoint - Summit State Bank reported a significant decline in net income for the second quarter of 2024, primarily due to high interest rates affecting funding costs, which is a challenge faced by the entire banking industry [1][2]. Financial Performance - Net income for Q2 2024 was $928,000, or $0.14 per diluted share, down from $2,985,000, or $0.45 per diluted share in Q2 2023 [1][2]. - The annualized return on average assets was 0.35% and return on average equity was 3.82%, compared to 1.03% and 12.69% respectively in Q2 2023 [3][25]. - Net interest margin decreased to 2.71% in Q2 2024 from 3.44% in Q2 2023, with interest and dividend income down 8% to $14,371,000 [4][25]. Loan and Deposit Trends - Net loans decreased by $11,292,000 to $913,514,000 compared to $924,806,000 a year earlier [2][7]. - Total deposits decreased by 8% to $966,587,000 compared to $1,048,316,000 in Q2 2023, although there was a 3% increase from the previous quarter [2][8]. Credit Quality - Nonperforming assets were $40,994,000, or 3.79% of total assets, an increase from $24,908,000 a year earlier [11][25]. - The allowance for credit losses to total loans was 1.52% as of June 30, 2024, down from 1.62% a year ago [14][25]. Capital and Liquidity - The bank maintained strong liquidity of $479,202,000, or 44.3% of total assets, as of June 30, 2024 [2][10]. - Shareholders' equity was $97,949,000, with a book value of $14.44 per share, compared to $13.92 a year ago [9][25]. Operating Expenses - Operating expenses decreased to $6,627,000 in Q2 2024 from $6,822,000 in Q2 2023, primarily due to reductions in stock appreciation rights and employee bonuses [6][25].