Five Star Bancorp Announces Second Quarter 2025 Results

Core Insights - Five Star Bancorp reported a net income of $14.5 million for Q2 2025, an increase from $13.1 million in Q1 2025 and $10.8 million in Q2 2024 [1][8][9] Financial Performance - Return on average assets (ROAA) improved to 1.37% in Q2 2025 from 1.30% in Q1 2025 and 1.23% in Q2 2024 [2][12] - Return on average equity (ROAE) increased to 14.17% in Q2 2025 from 13.28% in Q1 2025 and 11.72% in Q2 2024 [2][12] - Pre-tax income rose to $20.1 million in Q2 2025, up from $18.4 million in Q1 2025 and $15.2 million in Q2 2024 [2][12] - Basic and diluted earnings per share were both $0.68 in Q2 2025, compared to $0.62 in Q1 2025 and $0.51 in Q2 2024 [2][12] Loan and Deposit Growth - Total loans held for investment increased by $136.2 million, or 3.76% (15.04% annualized), from Q1 2025 to Q2 2025 [3][7] - Total deposits rose by $158.3 million, or 4.24% (16.94% annualized), during the same period [3][7] - Non-wholesale deposits increased by $191.6 million, or 6.29%, while wholesale deposits decreased by $33.4 million, or 4.84% [6][7] Interest Income and Margin - Net interest income for Q2 2025 was $36.5 million, an increase of $2.5 million, or 7.47%, from Q1 2025 [2][21] - Net interest margin improved to 3.53% in Q2 2025 from 3.45% in Q1 2025 [2][12] Expense Management - Non-interest expense increased by $0.7 million in Q2 2025 compared to Q1 2025, primarily due to higher business travel and promotional expenses [8][9] - The efficiency ratio improved to 41.03% in Q2 2025 from 42.58% in Q1 2025 [10][12] Asset Quality - The ratio of nonperforming loans to loans held for investment increased slightly from 0.05% at the end of Q1 2025 to 0.06% at the end of Q2 2025 [11][27] - The allowance for credit losses was $40.2 million as of June 30, 2025, up from $37.8 million at the end of 2024 [26][28] Market Expansion - The company plans to open a new office in Walnut Creek in Q3 2025, expanding its presence in the San Francisco Bay Area [5][6] - The team in the Bay Area has grown to 34 employees, with deposits totaling $456.9 million as of June 30, 2025 [5][6]