First National Corporation Reports Record Second Quarter 2025 Earnings

Core Insights - First National Corporation reported a net income of $5.05 million for the second quarter of 2025, with basic and diluted earnings per share of $0.56, reflecting a significant increase of 211% from the previous period and 44% from the same quarter last year [1][6]. Financial Performance - Adjusted earnings for the second quarter of 2025 were $5.1 million, with adjusted basic and diluted earnings per share of $0.57 [1][6]. - The net interest margin (FTE) improved to 3.95%, up from 3.77% in the first quarter of 2025 and 3.40% in the second quarter of 2024 [4][6]. - Net interest income for the second quarter was $18.5 million, an increase of $1.0 million from the previous quarter [4][6]. - Non-interest income rose to $3.9 million, a 7.7% increase from the prior quarter, driven by higher ATM and check card income [5][6]. Balance Sheet Highlights - Total assets reached $2.041 billion, a 40.1% increase from the previous year, primarily due to growth in loans held for investment [9][12]. - Loans held for investment totaled $1.428 billion, up 46.1% from one year prior [10][12]. - Total deposits were $1.803 billion, reflecting a 42.5% increase from the previous year [12]. Expense Management - Non-interest expense decreased to $15.2 million, down from $18.3 million in the prior quarter, mainly due to reduced merger-related expenses and lower salaries and benefits [7][8]. - Adjusted operating non-interest expense was $14.7 million, a decrease of $1.3 million from the previous quarter [8]. Asset Quality - Nonperforming assets as a percentage of total assets increased to 0.33% from 0.24% in the previous quarter, but decreased from 0.59% a year ago [17][20]. - Net charge-offs totaled $448 thousand in the second quarter, down from $2.4 million in the first quarter of 2025 [19][32]. Capital Ratios - The total capital ratio stood at 14.89%, with a Tier 1 capital ratio of 12.37% as of June 30, 2025 [22][31]. - The tangible book value per share was $17.40, reflecting a slight increase from the previous quarter [22][31].