Banking – Page 360 – NewzIntel.com

MIL-OSI Australia: Treasurer to hold key meetings in United States and United Kingdom

Source: New South Wales Government 2

Headline: Treasurer to hold key meetings in United States and United Kingdom

Published: 28 January 2025

Statement by: Treasurer

Treasurer Daniel Mookhey will travel to the United States and United Kingdom holding key meetings to ensure NSW keeps borrowing rates low and to explore investment opportunities for the state.

During a nine-day trip beginning today, Treasurer Mookhey will visit Washington, New York and London, accompanied by TCorp’s Chief Executive Officer David Deverall.

Treasurer Mookhey will hold events with a range of bond holders, fund managers and investors including JP Morgan, Goldman Sachs, BlackRock, Nasdaq, the Bank of England and Capital Group, as well as meetings with ratings agencies.

The NSW Treasurer will also meet leaders including Australia’s Ambassador to the United States Kevin Rudd, Australian Consul-General in New York Ms Heather Ridout AO and will attend an industry event with former NSW Premier Dominic Perrottet.

This is Treasurer Mookhey’s first international trip since taking office.

MIL OSI News –

January 29, 2025

MIL-OSI Europe: Netherlands: Royal Schiphol Group enters into a loan agreement with the EIB for infrastructure investments

Source: European Investment Bank

Royal Schiphol Group and the European Investment Bank (EIB) have entered into a loan agreement to the value of EUR 175 million. This represents the first installment of a total financing of EUR 400 million. The loan contributes to the financial stability of Schiphol and is an important milestone in the realisation of the major EUR 6 million investment programme.

CFO Robert Carsouw: ’The largest investment programme in the airport’s history asks for robust finances and healthy cashflows. Additional financial resources are necessary in order to realise the infrastructure investments. We are very pleased with the support of the EIB and look forward to continuing our longstanding relationship. This loan contributes to ensuring our financial foundation.’

EIB Vice-President Robert de Groot added: ‘Our relationship with Schiphol goes back more than two decades, and we are committed to supporting them in these efficiency improvements, to the benefit of both staff and travelers. The EIB finances projects that matter to people, and align with the strategic priorities of the EU, this is a great example of both.’

New baggage basement

This loan will be used primarily for the construction of a new baggage basement. The new baggage basement will provide the necessary capacity to replace and upgrade the existing baggage system, which will improve working conditions for baggage handlers. The preparations for construction started recently.

Investment portfolio: EUR 6 billion in 5 years

Schiphol is investing EUR 6 billion over the next 5 years in the improvement of airport facilities including the maintenance and renovation of aviation infrastructure, renovation of passenger and employee facilities and implementation of innovative improvements to working conditions. Read more here.

Ongoing EIB support

Apart from previous financing for Schiphol’s infrastructure projects, in 2023, the EIB supported the airport’s electrification of airside equipment, which helped to lower emissions in line with Schiphol’s sustainability targets. With the planned investments related to this new loan, Schiphol will enhance its operational capabilities and contribute to the critical civilian infrastructure. The loan therefore falls under the EIB’s Strategic European Security Initiative (SESI).

MIL OSI Europe News –

January 29, 2025

MIL-OSI Europe: New Human Rights Toolkit for financial institutions

Source: European Investment Bank

Dutch-based electrical data analytics company Samotics has signed a €20 million financing agreement with the European Investment Bank (EIB) to accelerate its research and development activities. The EIB’s investment will enhance the company’s solutions regarding the monitoring of machine health and energy efficiency, while accelerating work on its next-generation integrated solution, planned for launch this year. The funding aligns with Samotics’ mission to make industries more reliable, efficient, and sustainable.

MIL OSI Europe News –

January 29, 2025

MIL-OSI: C&F Financial Corporation Announces Net Income for 2024

Source: GlobeNewswire (MIL-OSI)

TOANO, Va., Jan. 28, 2025 (GLOBE NEWSWIRE) — C&F Financial Corporation (the Corporation) (NASDAQ: CFFI), the holding company for C&F Bank, today reported consolidated net income of $6.0 million for the fourth quarter of 2024, compared to $5.1 million for the fourth quarter of 2023. The Corporation reported consolidated net income of $19.9 million for the year ended December 31, 2024, compared to $23.7 million for the year ended December 31, 2023. The following table presents selected financial performance highlights for the periods indicated:


	For The Quarter Ended						For the Year Ended
Consolidated Financial Highlights (unaudited)	12/31/2024			12/31/2023			12/31/2024			12/31/2023
Consolidated net income (000’s)	$	6,029		$	5,088		$	19,918		$	23,746

Earnings per share – basic and diluted	$	1.87		$	1.50		$	6.01		$	6.92

Annualized return on average equity		10.60	%		10.06	%		9.02	%		11.68	%
Annualized return on average tangible common equity¹		12.17	%		11.74	%		10.37	%		13.58	%
Annualized return on average assets		0.94	%		0.85	%		0.80	%		0.99	%

_________________
¹ For more information about these non-GAAP financial measures, which are not calculated in accordance with generally accepted accounting principles (GAAP), please see “Use of Certain Non-GAAP Financial Measures” and “Reconciliation of Certain Non-GAAP Financial Measures,” below.

“While the past year’s financial performance reflected the challenges of a dynamic interest rate environment, our fourth quarter earnings were solid, and we are optimistic of earnings momentum heading into the coming year,” commented Tom Cherry, President and Chief Executive Officer of C&F Financial Corporation. “Our net interest margin was down for 2024, however, it stabilized in the fourth quarter, and we are cautiously optimistic about margin performance in 2025. The community banking segment delivered solid loan and deposit growth across all markets. Despite facing headwinds from higher mortgage rates and a low inventory of homes for sale, the mortgage banking segment increased its loan production and net income over 2023. While higher charge-offs weighed on profitability at the consumer finance segment, we were able to achieve significant operational efficiencies during 2024. Despite obstacles and adversities that continually confront the banking industry in general, we believe C&F is well-positioned for the future.”

Key highlights for the fourth quarter and the year ended December 31, 2024 are as follows.

Community banking segment loans grew $21.5 million, or 6.0 percent annualized, and $180.0 million, or 14.1 percent, compared to September 30, 2024 and December 31, 2023, respectively;
Consumer finance segment loans decreased $10.5 million, or 8.8 percent annualized, and $1.7 million, or less than one percent, compared to September 30, 2024 and December 31, 2023, respectively;
Deposits increased $35.0 million, or 6.6 percent annualized, and $104.7 million, or 5.1 percent, compared to September 30, 2024 and December 31, 2023, respectively;
Consolidated annualized net interest margin was 4.13 percent for the fourth quarter of 2024 compared to 4.17 percent for the fourth quarter of 2023 and 4.13 percent in the third quarter of 2024. Consolidated net interest margin was 4.12 percent for the year ended December 31, 2024 compared to 4.31 percent for the year ended December 31, 2023;
The community banking segment recorded no provision for credit losses for the fourth quarter of 2024 and $75,000 for the fourth quarter of 2023, and recorded provision for credit losses of $1.7 million and $1.6 million for the years ended December 31, 2024 and 2023, respectively;
The consumer finance segment recorded provision for credit losses of $3.5 million and $2.4 million for the fourth quarters of 2024 and 2023, respectively, and recorded provision for credit losses of $11.6 million and $6.7 million for the years ended December 31, 2024 and 2023, respectively;
The consumer finance segment experienced net charge-offs at an annualized rate of 3.40 percent of average total loans for the fourth quarter of 2024, compared to 2.72 percent for the fourth quarter of 2023. Net charge-offs as a percentage of average total loans were 2.62 percent for the year ended December 31, 2024, compared to 1.99 percent for the year ended December 31, 2023; and
Mortgage banking segment loan originations increased $32.2 million, or 32.8 percent, to $130.4 million for the fourth quarter of 2024 compared to the fourth quarter of 2023 and increased $29.0 million, or 5.8 percent, to $527.8 million for the year ended December 31, 2024 compared to the year ended December 31, 2023.

Community Banking Segment. The community banking segment reported net income of $6.4 million for the fourth quarter of 2024, compared to $5.2 million for the same period of 2023, due primarily to:

higher interest income resulting from higher average balances of loans and the effects of higher interest rates on asset yields, offset in part by lower average balances of securities;
higher other income from bank owned life insurance policies; and
lower salaries and employee benefits expense due primarily to a reduction in headcount through attrition;

partially offset by:

higher interest expense due primarily to higher rates on deposits and higher average balances of interest-bearing deposits, offset in part by lower average balances of borrowings.

The community banking segment reported net income of $20.3 million for the year ended December 31, 2024, compared to $22.9 million for the same period of 2023, due primarily to:

higher interest expense resulting from higher rates on deposits and higher average balances of interest-bearing deposits, partially offset by lower average balances of borrowings;
higher data processing and consulting costs related to investments in operational technology to improve resilience, efficiency and customer experience;
higher occupancy expense related to branch network improvements, including the relocation of a branch and the opening of a new branch; and
higher salaries and employee benefits expense, which have generally increased in line with market conditions, offset in part by a reduction in headcount through attrition;

partially offset by:

higher interest income resulting from higher average balances of loans and the effects of higher interest rates on asset yields, offset in part by lower average balances of securities;
higher wealth management services income due primarily to higher assets under management;
higher other income from bank owned life insurance policies; and
higher investment income from other equity investments.

Average loans increased $180.8 million, or 14.4 percent, for the fourth quarter of 2024 and increased $164.0 million, or 13.5 percent, for the year ended December 31, 2024, compared to the same periods in 2023, due primarily to growth in the construction, commercial real estate, and residential mortgage segments of the loan portfolio. Average deposits increased $140.2 million, or 6.9 percent, for the fourth quarter of 2024 and increased $110.8 million, or 5.5 percent, for the year ended December 31, 2024, compared to the same periods in 2023, due primarily to higher balance of time deposits, partially offset by decreases in savings and interest-bearing demand deposits and noninterest-bearing demand deposits amid increased competition for deposits and the higher interest rate environment.

Average loan yields and average costs of interest-bearing deposits were higher for the fourth quarter and the year ended December 31, 2024, compared to the same periods of 2023, due primarily to the effects of the higher interest rate environment.

The community banking segment’s nonaccrual loans were $333,000 at December 31, 2024 compared to $406,000 at December 31, 2023. The community banking segment recorded no provision for credit losses for the fourth quarter of 2024 and $1.7 million for the year ended December 31, 2024 compared to $75,000 and $1.6 million for the same periods of 2023. At December 31, 2024, the allowance for credit losses increased to $17.4 million, compared to $16.1 million at December 31, 2023. The allowance for credit losses as a percentage of total loans decreased to 1.20 percent at December 31, 2024 from 1.26 percent at December 31, 2023. The increases in provision and allowance for credit losses are due primarily to growth in the loan portfolio. Management believes that the level of the allowance for credit losses is adequate to reflect the net amount expected to be collected.

Mortgage Banking Segment. The mortgage banking segment reported net income of $87,000 and $1.1 million for the fourth quarter and year ended December 31, 2024, respectively, compared to a net loss of $103,000 and net income of $465,000 for the same periods of 2023, due primarily to:

higher gains on sales of loans and higher mortgage banking fee income due to higher volume of mortgage loan originations; and
lower occupancy expenses due to an effort to reduce overhead costs;

partially offset by:

higher variable expenses tied to mortgage loan origination volume such as commissions and bonuses, reported in salaries and employee benefits; and
lower reversal of provision for indemnifications.

The sustained elevated level of mortgage interest rates, combined with higher home prices and lower levels of inventory, led to a level of mortgage loan originations in 2024 and 2023 for the industry that is lower than recent historical averages. Mortgage loan originations for the mortgage banking segment were $130.4 million for the fourth quarter of 2024, comprised of $15.9 million refinancings and $114.5 million home purchases, compared to $98.2 million, comprised of $12.5 million refinancings and $85.7 million home purchases, for the same period in 2023. Mortgage loan originations for the mortgage banking segment were $527.8 million for the year ended December 31, 2024, comprised of $50.2 million refinancings and $477.6 million home purchases, compared to $498.8 million, comprised of $52.7 million refinancings and $446.1 million home purchases, for the same period in 2023. Mortgage loan originations in the fourth quarter of 2024 decreased $26.6 million compared to the third quarter of 2024 due in part to normal industry seasonal fluctuations. Mortgage loan segment originations include originations of loans sold to the community banking segment, at prices similar to those paid by third-party investors. These transactions are eliminated to reach consolidated totals.

During the fourth quarter and year ended December 31, 2024, the mortgage banking segment recorded a reversal of provision for indemnification losses of $85,000 and $460,000, respectively, compared to a reversal of provision for indemnification losses of $150,000 and $585,000 in the same periods of 2023. The mortgage banking segment increased reserves for indemnification losses during 2020 based on widespread forbearance on mortgage loans and economic uncertainty related to the COVID-19 pandemic. The release of indemnification reserves in 2024 and 2023 was due primarily to improvement in the mortgage banking segment’s assessment of borrower payment performance, lower volume of mortgage loan originations in recent years and other factors affecting expected losses on mortgage loans sold in the secondary market, such as time since origination. Management believes that the indemnification reserve is sufficient to absorb losses related to loans that have been sold in the secondary market.

Consumer Finance Segment. The consumer finance segment reported net income of $272,000 and $1.4 million for the fourth quarter and year ended December 31, 2024, respectively, compared to net income of $618,000 and $2.9 million for the same periods in 2023. The decreases in consumer finance segment net income were due primarily to:

higher provision for credit losses due primarily to increased net charge-offs; and
higher interest expense on variable rate borrowings from the community banking segment as a result of higher interest rates and higher average balances of borrowings;

partially offset by:

higher interest income resulting from the effects of higher interest rates on loan yields and higher average balances of loans;
lower salaries and employee benefits expense due to an effort to reduce overhead costs; and
lower loan processing and collection expenses due primarily to efficiency initiatives within the collections department.

Average loans increased $2.5 million, or one percent, for the fourth quarter of 2024 and increased $2.9 million, or one percent, for the year ended December 31, 2024, compared to the same periods in 2023. The consumer finance segment experienced net charge-offs at a rate of 2.62 percent of average total loans for the year ended December 31, 2024, compared to 1.99 percent for the year ended December 31, 2023, due primarily to an increase in the number of delinquent loans, the number of repossessions, and the average amount charged-off when a loan was uncollectable. Higher amounts charged-off per loan resulted in part from larger loan amounts, generally purchased in 2020 and 2021 when automobile values were higher, being charged-off in the current year, with the wholesale values of automobiles having declined since then. At December 31, 2024, total delinquent loans as a percentage of total loans was 3.90 percent, compared to 4.09 percent at December 31, 2023, and 3.49 percent at September 30, 2024.

The consumer finance segment, at times, offers payment deferrals as a portfolio management technique to achieve higher ultimate cash collections on select loan accounts. A significant reliance on deferrals as a means of managing collections may result in a lengthening of the loss confirmation period, which would increase expectations of credit losses inherent in the portfolio. Average amounts of payment deferrals of automobile loans on a monthly basis, which are not included in delinquent loans, were 2.11 percent and 1.80 percent of average automobile loans outstanding during the fourth quarter and year ended December 31, 2024, respectively, compared to 2.02 percent and 1.87 percent during the same periods during 2023. The allowance for credit losses was $22.7 million at December 31, 2024 and $23.6 million at December 31, 2023. The allowance for credit losses as a percentage of total loans decreased to 4.86 percent at December 31, 2024 from 5.03 percent at December 31, 2023, primarily as a result of growth in loans with stronger credit quality while balances of loans with lower credit quality declined. Management believes that the level of the allowance for credit losses is adequate to reflect the net amount expected to be collected. If loan performance deteriorates resulting in further elevated delinquencies or net charge-offs, the provision for credit losses may increase in future periods.

Liquidity. The objective of the Corporation’s liquidity management is to ensure the continuous availability of funds to satisfy the credit needs of our customers and the demands of our depositors, creditors and investors. Uninsured deposits represent an estimate of amounts above the Federal Deposit Insurance Corporation (FDIC) insurance coverage limit of $250,000. As of December 31, 2024, the Corporation’s uninsured deposits were approximately $640.2 million, or 29.5 percent of total deposits. Excluding intercompany cash holdings and municipal deposits, which are secured with pledged securities, amounts uninsured were approximately $455.2 million, or 21.0 percent of total deposits as of December 31, 2024. The Corporation’s liquid assets, which include cash and due from banks, interest-bearing deposits at other banks and nonpledged securities available for sale, were $288.1 million and borrowing availability was $606.2 million as of December 31, 2024, which in total exceed uninsured deposits, excluding intercompany cash holdings and secured municipal deposits, by $439.1 million as of December 31, 2024.

In addition to deposits, the Corporation utilizes short-term and long-term borrowings as sources of funds. Short-term borrowings from the Federal Reserve Bank and the Federal Home loan Bank of Atlanta (FHLB) may be used to fund the Corporation’s day-to-day operations. Short-term borrowings also include securities sold under agreements to repurchase. Total borrowings increased to $122.6 million at December 31, 2024 from $109.5 million at December 31, 2023 due primarily to higher long-term borrowings from the FHLB used in part to fund loan growth.

Additional sources of liquidity available to the Corporation include cash flows from operations, loan payments and payoffs, deposit growth, maturities, calls and sales of securities and the issuance of brokered certificates of deposit.

Capital and Dividends. The Corporation declared cash dividends during the year ended December 31, 2024 totaling $1.76 per share, including a quarterly cash dividend of 44 cents per share during the fourth quarter of 2024, which was paid on January 1, 2025. These dividends represent a payout ratio of 23.5 percent of earnings per share for the fourth quarter of 2024 and 29.3 percent of earnings per share for the year ended December 31, 2024. The Board of Directors of the Corporation continually reviews the amount of cash dividends per share and the resulting dividend payout ratio in light of changes in economic conditions, current and future capital requirements, and expected future earnings.

Total consolidated equity increased $9.5 million at December 31, 2024, compared to December 31, 2023, due primarily to net income and lower unrealized losses in the market value of securities available for sale, which are recognized as a component of other comprehensive income, partially offset by share repurchases and dividends paid on the Corporation’s common stock. The Corporation’s securities available for sale are fixed income debt securities and their unrealized loss position is a result of rising market interest rates since they were purchased. The Corporation expects to recover its investments in debt securities through scheduled payments of principal and interest. Unrealized losses are not expected to affect the earnings or regulatory capital of the Corporation or C&F Bank. The accumulated other comprehensive loss related to the Corporation’s securities available for sale, net of deferred income taxes, decreased to $23.7 million at December 31, 2024 compared to $25.0 million at December 31, 2023 due primarily to fluctuations in debt security market interest rates and a decrease in the balance of securities available for sale.

As of December 31, 2024, the most recent notification from the FDIC categorized the C&F Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized under regulations applicable at December 31, 2024, C&F Bank was required to maintain minimum total risk-based, Tier 1 risk-based, CET1 risk-based and Tier 1 leverage ratios. In addition to the regulatory risk-based capital requirements, C&F Bank must maintain a capital conservation buffer of additional capital of 2.5 percent of risk-weighted assets as required by the Basel III capital rules. The Corporation and C&F Bank exceeded these ratios at December 31, 2024. For additional information, see “Capital Ratios” below. The above mentioned ratios are not impacted by unrealized losses on securities available for sale. In the event that all of these unrealized losses became realized into earnings, the Corporation and C&F Bank would both continue to exceed minimum capital requirements, including the capital conservation buffer, and be considered well capitalized.

In December 2023, the Board of Directors authorized a program, effective January 1, 2024 through December 31, 2024, to repurchase up to $10.0 million of the Corporation’s common stock (the 2024 Repurchase Program). During the fourth quarter and year ended December 31, 2024, the Corporation repurchased 11,100 shares, or $679,000, and 160,694 shares, or $7.9 million, of its common stock under the 2024 Repurchase Program, respectively. In December 2024, the Board of Directors authorized a new program, effective January 1, 2025 through December 31, 2025, to repurchase up to $5.0 million of the Corporation’s common stock through December 31, 2025 (the 2025 Repurchase Program).

About C&F Financial Corporation. The Corporation’s common stock is listed for trading on The Nasdaq Stock Market under the symbol CFFI. The common stock closed at a price of $75.40 per share on January 27, 2025. At December 31, 2024, the book value per share of the Corporation was $70.00 and the tangible book value per share was $61.86. For more information about the Corporation’s tangible book value per share, which is not calculated in accordance with GAAP, please see “Use of Certain Non-GAAP Financial Measures” and “Reconciliation of Certain Non-GAAP Financial Measures,” below.

C&F Bank operates 31 banking offices and four commercial loan offices located throughout eastern and central Virginia and offers full wealth management services through its subsidiary C&F Wealth Management, Inc. C&F Mortgage Corporation and its subsidiary C&F Select LLC provide mortgage loan origination services through offices located in Virginia and the surrounding states. C&F Finance Company provides automobile, marine and recreational vehicle loans through indirect lending programs offered primarily in the Northeastern, Midwestern and Southern United States from its headquarters in Henrico, Virginia.

Additional information regarding the Corporation’s products and services, as well as access to its filings with the Securities and Exchange Commission (SEC), are available on the Corporation’s website at http://www.cffc.com.

Use of Certain Non-GAAP Financial Measures. The accounting and reporting policies of the Corporation conform to GAAP in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of the Corporation’s performance. These include adjusted net income, adjusted earnings per share, adjusted return on average equity, adjusted return on average assets, return on average tangible common equity (ROTCE), adjusted ROTCE, tangible book value per share, price to tangible book value ratio, and the following fully-taxable equivalent (FTE) measures: interest income on loans-FTE, interest income on securities-FTE, total interest income-FTE and net interest income-FTE.

Management believes that the use of these non-GAAP measures provides meaningful information about operating performance by enhancing comparability with other financial periods, other financial institutions, and between different sources of interest income. The non-GAAP measures used by management enhance comparability by excluding the effects of balances of intangible assets, including goodwill, that vary significantly between institutions, and tax benefits that are not consistent across different opportunities for investment. These non-GAAP financial measures should not be considered an alternative to GAAP-basis financial statements, and other bank holding companies may define or calculate these or similar measures differently. A reconciliation of the non-GAAP financial measures used by the Corporation to evaluate and measure the Corporation’s performance to the most directly comparable GAAP financial measures is presented below.

Forward-Looking Statements. This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on the beliefs of the Corporation’s management, as well as assumptions made by, and information currently available to, the Corporation’s management, and reflect management’s current views with respect to certain events that could have an impact on the Corporation’s future financial performance. These statements, including without limitation statements made in Mr. Cherry’s quote and statements regarding future interest rates and conditions in the Corporation’s industries and markets, relate to expectations concerning matters that are not historical fact, may express “belief,” “intention,” “expectation,” “potential” and similar expressions, and may use the words “believe,” “expect,” “anticipate,” “estimate,” “plan,” “may,” “might,” “will,” “intend,” “target,” “should,” “could,” or similar expressions. These statements are inherently uncertain, and there can be no assurance that the underlying assumptions will prove to be accurate. Actual results could differ materially from those anticipated or implied by such statements. Forward-looking statements in this release may include, without limitation, statements regarding expected future operations and financial performance, expected trends in yields on loans, expected future recovery of investments in debt securities, future dividend payments, deposit trends, charge-offs and delinquencies, changes in cost of funds and net interest margin and items affecting net interest margin, strategic business initiatives and the anticipated effects thereof, changes in interest rates and the effects thereof on net interest income, mortgage loan originations, expectations regarding C&F Bank’s regulatory risk-based capital requirement levels, technology initiatives, our diversified business strategy, asset quality, credit quality, adequacy of allowances for credit losses and the level of future charge-offs, market interest rates and housing inventory and resulting effects in mortgage loan origination volume, sources of liquidity, adequacy of the reserve for indemnification losses related to loans sold in the secondary market, the effect of future market and industry trends, the effects of future interest rate fluctuations, cybersecurity risks, and inflation. Factors that could have a material adverse effect on the operations and future prospects of the Corporation include, but are not limited to, changes in:

interest rates, such as volatility in short-term interest rates or yields on U.S. Treasury bonds, increases in interest rates following actions by the Federal Reserve and increases or volatility in mortgage interest rates
general business conditions, as well as conditions within the financial markets
general economic conditions, including unemployment levels, inflation rates, supply chain disruptions and slowdowns in economic growth
general market conditions, including disruptions due to pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts (including the ongoing military conflicts between Russia and Ukraine and in the Middle East) or other major events, or the prospect of these events
average loan yields and average costs of interest-bearing deposits
financial services industry conditions, including bank failures or concerns involving liquidity
labor market conditions, including attracting, hiring, training, motivating and retaining qualified employees
the legislative/regulatory climate, regulatory initiatives with respect to financial institutions, products and services, the Consumer Financial Protection Bureau (the CFPB) and the regulatory and enforcement activities of the CFPB
monetary and fiscal policies of the U.S. Government, including policies of the FDIC, U.S. Department of the Treasury and the Board of Governors of the Federal Reserve System, and the effect of these policies on interest rates and business in our markets
demand for financial services in the Corporation’s market area
the value of securities held in the Corporation’s investment portfolios
the quality or composition of the loan portfolios and the value of the collateral securing those loans
the inventory level, demand and fluctuations in the pricing of used automobiles, including sales prices of repossessed vehicles
the level of automobile loan delinquencies or defaults and our ability to repossess automobiles securing delinquent automobile finance installment contracts
the level of net charge-offs on loans and the adequacy of our allowance for credit losses
the level of indemnification losses related to mortgage loans sold
demand for loan products
deposit flows
the strength of the Corporation’s counterparties
the availability of lines of credit from the FHLB and other counterparties
the soundness of other financial institutions and any indirect exposure related to the closing of other financial institutions and their impact on the broader market through other customers, suppliers and partners, or that the conditions which resulted in the liquidity concerns experienced by closed financial institutions may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Corporation has commercial or deposit relationships
competition from both banks and non-banks, including competition in the non-prime automobile finance markets and marine and recreational vehicle finance markets
services provided by, or the level of the Corporation’s reliance upon third parties for key services
the commercial and residential real estate markets, including changes in property values
the demand for residential mortgages and conditions in the secondary residential mortgage loan markets
the Corporation’s technology initiatives and other strategic initiatives
the Corporation’s branch expansions and consolidations plans
cyber threats, attacks or events
C&F Bank’s product offerings
accounting principles, policies and guidelines, and elections by the Corporation thereunder

These risks and uncertainties should be considered in evaluating the forward-looking statements contained herein, and readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this release. For additional information on risk factors that could affect the forward-looking statements contained herein, see the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2023 and other reports filed with the SEC. The Corporation undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.


C&F Financial Corporation Selected Financial Information (dollars in thousands, except for per share data) (unaudited)

Financial Condition	12/31/2024		12/31/2023
Interest-bearing deposits in other banks	$	49,423	$	58,777
Investment securities – available for sale, at fair value		418,625		462,444
Loans held for sale, at fair value		20,112		14,176
Loans, net:
Community Banking segment		1,436,226		1,257,557
Consumer Finance segment		444,085		444,931
Total assets		2,563,385		2,438,498
Deposits		2,170,860		2,066,130
Repurchase agreements		28,994		30,705
Other borrowings		93,615		78,834
Total equity		226,970		217,516


	For The				For The
	Quarter Ended				Year Ended
Results of Operations	12/31/2024		12/31/2023		12/31/2024		12/31/2023
Interest income	$	36,443	$	32,408	$	139,594	$	124,137
Interest expense		11,343		8,466		42,819		26,430
Provision for credit losses:
Community Banking segment		–		75		1,650		1,625
Consumer Finance segment		3,500		2,400		11,600		6,650
Noninterest income:
Gains on sales of loans		1,250		850		6,064		5,780
Other		5,700		6,953		24,474		23,835
Noninterest expenses:
Salaries and employee benefits		11,953		14,035		53,578		54,876
Other		9,363		9,038		36,352		35,007
Income tax expense		1,205		1,109		4,215		5,418
Net income		6,029		5,088		19,918		23,746

Fully-taxable equivalent (FTE) amounts¹
Interest income on loans-FTE		33,122		29,147		127,288		111,146
Interest income on securities-FTE		3,046		3,121		12,079		12,710
Total interest income-FTE		36,731		32,677		140,741		125,101
Net interest income-FTE		25,388		24,211		97,922		98,671

_________________
¹For more information about these non-GAAP financial measures, please see “Use of Certain Non-GAAP Financial Measures” and “Reconciliation of Certain Non-GAAP Financial Measures.”


	For the Quarter Ended
	12/31/2024							12/31/2023
	Average			Income/		Yield/		Average			Income/		Yield/
Yield Analysis	Balance			Expense		Rate		Balance			Expense		Rate
Assets
Securities:
Taxable	$	321,796		$	1,898	2.36	%	$	392,368		$	2,093	2.13	%
Tax-exempt		120,119			1,148	3.82			118,263			1,028	3.48
Total securities		441,915			3,046	2.76			510,631			3,121	2.44
Loans:
Community banking segment		1,438,195			20,036	5.54			1,257,418			16,813	5.30
Mortgage banking segment		30,674			486	6.30			22,288			383	6.82
Consumer finance segment		473,816			12,600	10.58			471,355			11,951	10.06
Total loans		1,942,685			33,122	6.78			1,751,061			29,147	6.60
Interest-bearing deposits in other banks		58,212			563	3.85			42,114			409	3.85
Total earning assets		2,442,812			36,731	5.98			2,303,806			32,677	5.63
Allowance for credit losses		(40,930	)						(40,614	)
Total non-earning assets		159,082							142,252
Total assets	$	2,560,964						$	2,405,444

Liabilities and Equity
Interest-bearing deposits:
Interest-bearing demand deposits	$	331,156			601	0.72		$	341,243			556	0.65
Money market deposit accounts		299,321			1,136	1.51			299,712			896	1.19
Savings accounts		176,106			26	0.06			194,476			33	0.07
Certificates of deposit		811,224			8,325	4.08			635,702			5,665	3.54
Total interest-bearing deposits		1,617,807			10,088	2.48			1,471,133			7,150	1.93
Borrowings:
Repurchase agreements		30,673			131	1.71			33,418			126	1.51
Other borrowings		93,765			1,124	4.79			98,875			1,190	4.81
Total borrowings		124,438			1,255	4.03			132,293			1,316	3.98
Total interest-bearing liabilities		1,742,245			11,343	2.59			1,603,426			8,466	2.10
Noninterest-bearing demand deposits		547,890							554,321
Other liabilities		43,379							45,462
Total liabilities		2,333,514							2,203,209
Equity		227,450							202,235
Total liabilities and equity	$	2,560,964						$	2,405,444
Net interest income				$	25,388						$	24,211
Interest rate spread						3.39	%						3.53	%
Interest expense to average earning assets						1.85	%						1.46	%
Net interest margin						4.13	%						4.17	%


	For the Year Ended
	12/31/2024							12/31/2023
	Average			Income/		Yield/		Average			Income/		Yield/
Yield Analysis	Balance			Expense		Rate		Balance			Expense		Rate
Assets
Securities:
Taxable	$	335,647		$	7,563	2.25	%	$	428,895		$	9,110	2.12	%
Tax-exempt		119,978			4,516	3.76			108,006			3,600	3.33
Total securities		455,625			12,079	2.65			536,901			12,710	2.37
Loans:
Community banking segment		1,378,131			75,707	5.49			1,214,143			62,188	5.12
Mortgage banking segment		30,737			1,897	6.17			25,598			1,695	6.62
Consumer finance segment		476,775			49,684	10.42			473,885			47,263	9.97
Total loans		1,885,643			127,288	6.75			1,713,626			111,146	6.49
Interest-bearing deposits in other banks		37,238			1,374	3.69			35,351			1,245	3.52
Total earning assets		2,378,506			140,741	5.92			2,285,878			125,101	5.47
Allowance for loan losses		(40,736	)						(41,047	)
Total non-earning assets		156,726							148,666
Total assets	$	2,494,496						$	2,393,497

Liabilities and Equity
Interest-bearing deposits:
Interest-bearing demand deposits	$	327,700			2,170	0.66		$	354,643			2,134	0.60
Money market deposit accounts		296,278			4,313	1.46			317,601			3,017	0.95
Savings accounts		180,429			111	0.06			209,033			124	0.06
Certificates of deposit		767,721			31,465	4.10			541,252			15,112	2.79
Total interest-bearing deposits		1,572,128			38,059	2.42			1,422,529			20,387	1.43
Borrowings:
Repurchase agreements		27,754			456	1.64			32,393			399	1.23
Other borrowings		91,713			4,304	4.69			116,908			5,644	4.83
Total borrowings		119,467			4,760	3.98			149,301			6,043	4.05
Total interest-bearing liabilities		1,691,595			42,819	2.53			1,571,830			26,430	1.68
Noninterest-bearing demand deposits		536,828							575,452
Other liabilities		45,217							42,954
Total liabilities		2,273,640							2,190,236
Equity		220,856							203,261
Total liabilities and equity	$	2,494,496						$	2,393,497
Net interest income				$	97,922						$	98,671
Interest rate spread						3.39	%						3.79	%
Interest expense to average earning assets						1.80	%						1.16	%
Net interest margin						4.12	%						4.31	%


	12/31/2024
Funding Sources	Capacity		Outstanding		Available
Unsecured federal funds agreements	$	75,000	$	—	$	75,000
Borrowings from FHLB		257,734		40,000		217,734
Borrowings from Federal Reserve Bank		313,499		—		313,499
Total	$	646,233	$	40,000	$	606,233


Asset Quality	12/31/2024			12/31/2023
Community Banking
Total loans	$	1,453,605		$	1,273,629
Nonaccrual loans	$	333		$	406

Allowance for credit losses (ACL)	$	17,379		$	16,072
Nonaccrual loans to total loans		0.02	%		0.03	%
ACL to total loans		1.20	%		1.26	%
ACL to nonaccrual loans		5,218.92	%		3,958.62	%
Year-to-date net charge-offs to average loans		0.01	%		0.01	%

Consumer Finance
Total loans	$	466,793		$	468,510
Nonaccrual loans	$	614		$	892
Repossessed assets	$	779		$	646
ACL	$	22,708		$	23,579
Nonaccrual loans to total loans		0.13	%		0.19	%
ACL to total loans		4.86	%		5.03	%
ACL to nonaccrual loans		3,698.37	%		2,643.39	%
Year-to-date net charge-offs to average loans		2.62	%		1.99	%


	For The						For The
	Quarter Ended						Year Ended
Other Performance Data	12/31/2024			12/31/2023			12/31/2024			12/31/2023
Net Income (Loss):
Community Banking	$	6,364		$	5,186		$	20,284		$	22,928
Mortgage Banking		87			(103	)		1,108			465
Consumer Finance		272			618			1,414			2,879
Other¹		(694	)		(613	)		(2,888	)		(2,526	)
Total	$	6,029		$	5,088		$	19,918		$	23,746

Net income attributable to C&F Financial Corporation	$	6,037		$	5,068		$	19,834		$	23,604

Earnings per share – basic and diluted	$	1.87		$	1.50		$	6.01		$	6.92
Weighted average shares outstanding – basic and diluted		3,226,999			3,367,931			3,299,574			3,411,995

Annualized return on average assets		0.94	%		0.85	%		0.80	%		0.99	%
Annualized return on average equity		10.60	%		10.06	%		9.02	%		11.68	%
Annualized return on average tangible common equity²		12.17	%		11.74	%		10.37	%		13.58	%
Dividends declared per share	$	0.44		$	0.44		$	1.76		$	1.76

Mortgage loan originations – Mortgage Banking	$	130,426		$	98,238		$	527,750		$	498,797
Mortgage loans sold – Mortgage Banking		154,552			109,387			522,001			498,852

_________________
¹ Includes results of the holding company that are not allocated to the business segments and elimination of inter-segment activity.
² For more information about these non-GAAP financial measures, please see “Use of Certain Non-GAAP Financial Measures” and “Reconciliation of Certain Non-GAAP Financial Measures.”


Market Ratios	12/31/2024		12/31/2023
Market value per share	$	71.25	$	68.19
Book value per share	$	70.00	$	64.28
Price to book value ratio		1.02		1.06
Tangible book value per share¹	$	61.86	$	56.40
Price to tangible book value ratio¹		1.15		1.21
Price to earnings ratio (ttm)		11.86		9.87

_________________
¹ For more information about these non-GAAP financial measures, please see “Use of Certain Non-GAAP Financial Measures” and “Reconciliation of Certain Non-GAAP Financial Measures.”



			Minimum Capital
Capital Ratios	12/31/2024	12/31/2023	Requirements³
C&F Financial Corporation¹
Total risk-based capital ratio	14.1%	14.8%	8.0%
Tier 1 risk-based capital ratio	11.9%	12.6%	6.0%
Common equity tier 1 capital ratio	10.7%	11.3%	4.5%
Tier 1 leverage ratio	9.8%	10.1%	4.0%

C&F Bank²
Total risk-based capital ratio	13.6%	14.1%	8.0%
Tier 1 risk-based capital ratio	12.3%	12.9%	6.0%
Common equity tier 1 capital ratio	12.3%	12.9%	4.5%
Tier 1 leverage ratio	10.1%	10.3%	4.0%

_________________
¹ The Corporation, a small bank holding company under applicable regulations and guidance, is not subject to the minimum regulatory capital regulations for bank holding companies. The regulatory requirements that apply to bank holding companies that are subject to regulatory capital requirements are presented above, along with the Corporation’s capital ratios as determined under those regulations.
² All ratios at December 31, 2024 are estimates and subject to change pending regulatory filings. All ratios at December 31, 2023 are presented as filed.
³ The ratios presented for minimum capital requirements are those to be considered adequately capitalized.


	For The Quarter Ended						For The Year Ended
	12/31/2024			12/31/2023			12/31/2024			12/31/2023
Reconciliation of Certain Non-GAAP Financial Measures
Return on Average Tangible Common Equity
Average total equity, as reported	$	227,450		$	202,235		$	220,856		$	203,261
Average goodwill		(25,191	)		(25,191	)		(25,191	)		(25,191	)
Average other intangible assets		(1,183	)		(1,439	)		(1,273	)		(1,538	)
Average noncontrolling interest		(518	)		(515	)		(649	)		(675	)
Average tangible common equity	$	200,558		$	175,090		$	193,743		$	175,857

Net income	$	6,029		$	5,088		$	19,918		$	23,746
Amortization of intangibles		64			69			260			273
Net loss (income) attributable to noncontrolling interest		8			(20	)		(84	)		(142	)
Net tangible income attributable to C&F Financial Corporation	$	6,101		$	5,137		$	20,094		$	23,877

Annualized return on average equity, as reported		10.60	%		10.06	%		12.02	%		15.58	%
Annualized return on average tangible common equity		12.17	%		11.74	%		10.37	%		13.58	%


	For The Quarter Ended				For The Year Ended
	12/31/2024		12/31/2023		12/31/2024		12/31/2023
Fully Taxable Equivalent Net Interest Income¹
Interest income on loans	$	33,075	$	29,093	$	127,089	$	110,938
FTE adjustment		47		54		199		208
FTE interest income on loans	$	33,122	$	29,147	$	127,288	$	111,146

Interest income on securities	$	2,805	$	2,906	$	11,131	$	11,954
FTE adjustment		241		215		948		756
FTE interest income on securities	$	3,046	$	3,121	$	12,079	$	12,710

Total interest income	$	36,443	$	32,408	$	139,594	$	124,137
FTE adjustment		288		269		1,147		964
FTE interest income	$	36,731	$	32,677	$	140,741	$	125,101

Net interest income	$	25,100	$	23,942	$	96,775	$	97,707
FTE adjustment		288		269		1,147		964
FTE net interest income	$	25,388	$	24,211	$	97,922	$	98,671

_________________
¹ Assuming a tax rate of 21%.


	December 31,			December 31,
*(Dollars in thousands except for per share data)*	2024			2023
Tangible Book Value Per Share
Equity attributable to C&F Financial Corporation	$	226,360		$	216,878
Goodwill		(25,191	)		(25,191	)
Other intangible assets		(1,147	)		(1,407	)
Tangible equity attributable to C&F Financial Corporation	$	200,022		$	190,280

Shares outstanding		3,233,672			3,374,098

Book value per share	$	70.00		$	64.28
Tangible book value per share	$	61.86		$	56.40

Contact:	Jason Long, CFO and Secretary
	(804) 843-2360

The MIL Network –

January 29, 2025

MIL-OSI United Nations: With Israeli Laws Set to Take Effect in 48 Hours, UN Palestine Refugee Agency Chief Warns Security Council of Risks to Gaza Ceasefire, Recovery Efforts

Source: United Nations General Assembly and Security Council

While Many Speakers Support Agency as Lifeline, Israel’s Delegate Says It Failed

The implementation of Israel’s legislation on 30 January — curtailing the operations of the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) — will undermine the ceasefire and sabotage Gaza’s recovery and political transition, a senior UN official told the Security Council today.

Expressing hope that the long-awaited ceasefire — which began nine days ago — “will hold and then the tremendous suffering in Gaza will subside”, Philippe Lazzarini, Commissioner-General of the United Nations Relief and Works Agency for Palestine Refugees in the Near East, welcomed the return of Israeli hostages and imprisoned Palestinians to their families. He also recognized the marked improvement in the flow of humanitarian aid and operating conditions. As the largest UN presence in Gaza — with 13,000 personnel and 300 premises — the Agency is critical in supporting a shattered population under a ceasefire, he emphasized.

Yet, in two days, “our operations in the Occupied Palestinian Territory will be crippled as legislation passed by Israel takes effect”, he warned, adding that the fate of millions of Palestinians is at stake. “In the wake of the ceasefire, we must contend with the devastation of the last 15 months and the enormity of the challenges ahead,” he said, pointing to a peer-reviewed study of death by traumatic injury in Gaza, which reveals that the mortality figure provided by the Ministry of Health is “a minimum estimate”. In fact, 46,000 deaths is likely an undercount by over 40 per cent, with the majority of those killed being women, children and the elderly. The study also confirms that those who escaped death by bombardment, starvation and disease have emerged shell-shocked.

Tens of thousands of people are now returning to the decimated north “to search for the living and to bury the dead”, he said, noting UNRWA’s unique mandate to provide public-like services to an entire population. He rejected Israel’s claim that the Agency plays “a negligible role” in providing humanitarian assistance in Gaza and that its services can be transferred to other entities. UNRWA constitutes half the emergency response, having delivered two thirds of all food assistance, provided shelter to over a million displaced persons and vaccinated a quarter of a million children against polio since October 2023. Less quantifiable, but critical for the humanitarian response and the ceasefire, is community acceptance: “Palestinians know and trust UNRWA,” he stressed.

Furthermore, Israel’s Government is investing significant resources to portray the Agency as a terrorist organization and its staff as terrorists or terrorist sympathizers. Billboards and ads accusing UNRWA of terrorism recently appeared in major cities worldwide. The political attacks on the Agency are motivated by the desire to strip Palestinians of their refugee status and erase their history and identity. Underscoring the need to allow the Agency to progressively conclude its mandate within the framework of a political process, he stated: “We are determined to stay and deliver until it is no longer possible to do so.”

Jan Egeland, Secretary-General of the Norwegian Refugee Council, recalled his visit to Gaza City in December 2024 and expressed shock at the destruction: clearing over 50 million tons of rubble in the aftermath of Israel’s bombardment “could take 21 years and cost up to $1.2 billion”. For two decades, children will have nowhere to play in the rubble and debris caused by this war, having to fear unexploded bombs. “The principles of proportionality, distinction and military necessity have been thoroughly violated,” he stated.

While his organization managed to have 18 trucks of humanitarian cargo enter Gaza last week, looting and attacks on aid convoys remain a major concern. He recalled that, on 12 September 2024, the Israeli National Security Council admitted to the Knesset that Israel was no longer issuing visas to employees of international non-governmental organizations — apparently part of a broader effort to undermine humanitarian work in the Occupied Palestinian Territory. However, as the occupying Power, Israel is legally obliged to facilitate humanitarian operations — in Gaza and in the West Bank alike.

Addressing the urgent humanitarian need, he called for full unrestricted access to northern Gaza, including the immediate opening of the Netzarim Corridor to facilitate the movement of civilians, humanitarian personnel and life-saving supplies. He further voiced alarm over intensified Israeli military operations and settler attacks across the occupied West Bank, urging the Council to “put all of our energies into achieving a peaceful resolution to the question of Palestine”.

…

MIL OSI United Nations News –

January 29, 2025

MIL-OSI Global: What the looming federal election could mean for the Bank of Canada’s independence

Source: The Conversation – Canada – By Andrew Allison, Philosophy PhD Student, University of Calgary

The independence of central banks from the democratic process has been a bedrock of economic policy for decades. The Bank of Canada is no exception, maintaining distance from elected officials to ensure monetary policy is free from political pressures.

However, a clear division between central bank and government could be tested with Mark Carney, former governor of both the Bank of Canada and the Bank of England who’s running for leadership of the Liberal Party and, in turn, the role of prime minister.

His bid raises concerns about how central bank independence might be perceived under a Carney-led government. Could his tenure as a central banker result in the Bank of Canada’s independence being clawed back? After all, he has demonstrated his ability to manage monetary policy at the highest levels.

The answer, if we want to preserve the economic benefits of central bank independence, is clear: the Bank of Canada’s independence must be preserved. And Carney, who has championed the importance of politically neutral monetary policy, would likely agree.

Incentives, not ignorance

The idea that central banks should operate independently of the democratic process is a widely held view among economists and central bankers. This is largely because there is an extremely low likelihood of elected officials committing to implement monetary policy that produces low inflation and stable prices.

If elected officials controlled monetary policy, incumbent governments would be tempted to “juice” the economy with “loose money” by reducing the interest rates right before elections.

In the short run, this would reduce unemployment, raise wages and potentially boost the chances of incumbent governments being re-elected. But, in the long run, citizens would pay the price in the form of inflation.

With repeated political interference, market entities would no longer react to injections of loose-money by investing in capital and labour and low interest rates would no longer produce the desired short-term benefits of more jobs and higher wages. But inflation would still persist. As economist Garrett Jones puts it, it would be “all hangover, no buzz.”

Empirical evidence bears this out. Central banks that with greater independence tend to have more price stability and less inflation.

This is why governments delegate monetary policy to independent central banks. Central bankers are able to implement monetary policy without the temptation to manipulate the economy for electoral gain.

It’s worth noting that the need for central bank independence is not exclusively due to politicians’ ignorance about managing monetary policy. Rather, it’s because the electoral incentives they face prevents them from being trusted to pull the levers of monetary power effectively.

This principle applies even to someone like Carney. If he were to become prime minister, he would face the same incentives as all other incumbent governments. Despite his expertise, he would still need independent central bankers to ensure monetary policy remains insulated from the political cycle.

Central bank independence in Canada

Central bank independence is not a binary, but exists on a spectrum. When studying the effects of independence, central banks are usually scored on a number of indicators, including whether central bankers can be fired by elected officials, how long central bankers’ terms are, and the extent to which they can be instructed by democratically elected bodies.

Widespread support for central bank independence among economists only began in the mid-1980s. Prior to that, central banks often gained their independence due to political and legal circumstances, rather then a deliberate attempt to adhere to a principle of independence. Both the Federal Reserve and the Bank of Canada have this in common.

The independence of the Bank of Canada had a tumultuous 25 years after its establishment in 1935. When pressed, finance ministers could not answer whether they or the Bank of Canada were ultimately responsible for the country’s monetary policy, often giving conflicting answers.

It would not be until 1961 that this uncertainty would come to a head during the Coyne Affair. Prime Minister John Diefenbaker wanted James Coyne, governor of the Bank of Canada at the time, fired for embarrassing his government and taking a hefty pension. The House of Commons passed a one-line bill that fired Coyne, but the Senate refused to pass it. Coyne resigned the next day.

After the Coyne Affair, central bank independence grew into the de facto status quo. In 1985, the Bank of Canada Act was passed, setting some limits on the power of the governor and their responsibility to the finance minister. As a result, Canada’s central bank independence falls somewhere in the middle of the spectrum compared to other wealthy, western nations.

Carney on central bank independence

In 2022, Conservative Party leader Pierre Poilievre threatened to fire the governor of the Bank of Canada, Tiff Macklem, if he became prime minister.

While the Bank of Canada Act does permit this through a formal procedure, setting the precedent that cabinets can and will fire governors could undermine central bank independence. It would risk making central bankers more beholden to the political aims of incumbent governments and more likely to produce inflationary monetary policy.

Compared to Poilievre, Carney is the conservative choice, likely aiming to maintain the status quo by leaving central bankers alone. During and after his time as a central banker, Carney has favoured central bank independence. And, as it stands, it doesn’t appear that he’s changed his mind now that he’s running for Liberal leader.

So, what would a Carney government mean for the Bank of Canada’s independence? Likely, not much — and from a monetary economic perspective, that’s a good thing. Preserving the status quo would ensure the Bank of Canada remains insulated from political interference, allowing it to focus on long-term price stability.

Andrew Allison receives funding from the Social Sciences and Humanities Research Council.

– ref. What the looming federal election could mean for the Bank of Canada’s independence – https://theconversation.com/what-the-looming-federal-election-could-mean-for-the-bank-of-canadas-independence-247886

MIL OSI – Global Reports –

January 29, 2025

MIL-OSI United Nations: Israel UNRWA ban will undermine Gaza ceasefire, Security Council hears

Source: United Nations 4

28 January 2025 Peace and Security

The implementation of new laws banning the UN Palestine refugee agency, UNRWA – set to take effect on Thursday – will heighten instability and deepen despair in the occupied Palestinian territory, the Security Council has heard.

Briefing ambassadors in New York on Tuesday, UNRWA Commissioner-General Philippe Lazzarini warned that the laws passed in October last year jeopardize the lives of millions of Palestinians and risks undermining the fragile ceasefire in Gaza.

They require that UNRWA cease its activities in the territory of the State of Israel – including the occupied West Bank, Gaza and East Jerusalem as the Knesset defines it, in defiance of international law – as well as restricting any Government contacts with the agency or anyone acting on its behalf.

“Curtailing our operations now – outside a political process, and when trust in the international community is so low – will undermine the ceasefire. It will sabotage Gaza’s recovery and political transition,” Mr. Lazzarini said.

He called for a “decisive intervention” by Council to support peace and stability in the occupied Palestinian territory and the broader region.

Disastrous consequences

Mr. Lazzarini further stressed that the full implementation of the Knesset legislation will be “disastrous”.

In Gaza, undermining UNRWA’s operations would compromise the international humanitarian response, he said, adding that it would also degrade the capacity of the United Nations just when humanitarian assistance must be scaled up.

“This will only worsen the already catastrophic living conditions of millions of Palestinians.”

UN Photo/Manuel Elías

Philippe Lazzarini, Commissioner-General of UNRWA, briefs the Security Council.

Unique role

UNRWA was established by the UN General Assembly to provide humanitarian and other essential services to Palestine refugees until a political solution is reached. Read our explainer on how the Gaza war has impacted UNRWA services, here.

Mr. Lazzarini emphasised that its work cannot simply be transferred to other entities, as its scale and trusted relationship with communities are unmatched.

“The Agency’s mere presence brings stability amid profound uncertainty,” he said. “Undermining UNRWA will sabotage Gaza’s recovery and any prospects for peace.”

In East Jerusalem, where the Knesset legislation calls for the immediate expulsion of UNRWA, 70,000 patients and 1,000 students will lose access to health and education services.

Mr. Lazzarini also noted that the legislation coincides with plans to expand illegal settlements on the land currently used by the Agency.

Financial and political challenges

Compounding these threats are severe financial constraints, with key donors reducing or suspending contributions.

Mr. Lazzarini appealed for urgent funding to sustain UNRWA’s operations, warning that its lifesaving work could abruptly end without sufficient resources.

He also highlighted a disinformation campaign spearheaded by Israeli authorities that falsely accuses the Agency of supporting terrorism. Such propaganda, he said, undermines UNRWA’s neutrality and puts its staff at risk.

Call to action

In conclusion, Mr. Lazzarini urged Security Council members to push back against the Knesset legislation, ensure continued funding for UNRWA, and advocate for a genuine political pathway to address the plight of Palestine refugees.

“UNRWA was always meant to be temporary,” he said.

“A fair and lasting political solution would allow the Agency to conclude its mandate, ensuring that its vital services are handed over to a functioning Palestinian state.”

More updates to come…

MIL OSI United Nations News –

January 29, 2025

MIL-OSI Africa: Revisiting the Africa-Paris Declaration: Progress, Challenges and the Road Ahead for African Energy

Source: Africa Press Organisation – English (2) – Report:

PARIS, France, January 28, 2025/APO Group/ —

The Africa-Paris Declaration, forged during the 2024 Invest in African Energy (IAE) Forum in Paris, was a pivotal moment in Africa’s quest for sustainable energy solutions. Aimed at strengthening the continent’s energy transition while addressing the urgent issue of energy poverty, the declaration set ambitious targets for expanding access to clean, affordable and reliable energy. With the 2025 edition of the forum approaching, now is the time to reflect on the progress made since the Africa-Paris Declaration and assess how these initiatives are shaping Africa’s energy future.

Increased Engagement in Africa

In the months following the declaration, international investors, development banks and private equity firms have shown a steadfast interest in the African energy market. A key milestone was the launch of the Africa Energy Bank by the African Export-Import Bank and APPO, marking the creation of a first-of-its-kind institution designed to fund and facilitate energy initiatives across the continent. Several final investment decisions were successfully closed, including Shell’s $5.5 billion Bonga North deepwater project. Additionally, strategic partnerships, including new PSCs signed by Panoro Energy in Equatorial Guinea and BW Energy in Gabon, highlight how international collaborations are accelerating energy development and creating new opportunities for exploration and production. This increased engagement is key to addressing the financing gap that has long hindered the growth of Africa’s energy sector.

Natural gas continues to play a central role in Africa’s energy strategy as a transitional fuel. The Africa-Paris Declaration underscored its importance as a bridge between traditional energy sources and renewable energy. Over the past year, significant strides have been made in natural gas exploration and LNG exports. Notable developments include Senegal’s Greater Tortue Ahmeyim LNG reaching its first gas production, the Republic of Congo’s first LNG exports to Italy from the Congo LNG project, Nigeria’s UTM FLNG receiving its construction license, and Angola’s Sanha Lean Gas Connection project achieving first gas, among others. These initiatives are not only crucial for advancing Africa’s energy transition, but also serve as powerful drivers of economic growth by creating jobs and advancing infrastructure development.

Meanwhile, countries like South Africa, Egypt and Morocco are at the forefront of wind and solar energy development, with momentum expected to build as they meet renewable energy targets and explore new growth opportunities. These investments are driving a shift toward cleaner, more sustainable energy in Africa, though challenges remain. High costs of renewable technologies and insufficient grid infrastructure continue to hinder expansion, underscoring the need for more investment in off-grid and mini-grid solutions.

Investment Gaps Persist

Despite these advancements, Africa still faces significant investment challenges. The financing gap for large-scale energy projects remains substantial and while the private sector has become more engaged, many projects still struggle to secure the necessary capital. In particular, the cost of financing remains high due to the perceived risks associated with energy investments in Africa. This is where continued efforts to de-risk investments and foster public-private partnerships are critical to unlocking the continent’s full energy potential. Institutional capacity continues to be a challenge for many African countries. While progress has been made in improving regulatory frameworks, there is still a need for clearer policies, streamlined permitting processes and better enforcement of regulations. Governments must continue to strengthen their institutions to effectively implement energy projects and create an enabling environment for both local and international investors.

With the IAE 2025 forum just months away, industry stakeholders have an opportunity to reflect on the progress made since the Africa-Paris Declaration and determine next steps for the continent’s energy future. The forum serves as a platform for government officials, industry leaders and financial institutions to renew commitments, share success stories and address ongoing challenges. While the road to universal energy access and a sustainable energy future is long, the declaration has set the framework for a collective effort that can lead to meaningful change. With the right investments, regulatory frameworks and political will, Africa can emerge as a global leader in energy innovation and sustainability.

MIL OSI Africa –

January 29, 2025

MIL-OSI United Kingdom: The UK urges Israel to ensure that UNRWA can continue its lifesaving operations: UK statement at the UN Security Council

Source: United Kingdom – Executive Government & Departments

Statement by Ambassador James Kariuki, UK Deputy Permanent Representative to the UN, at the UN Security Council meeting on UNRWA.

I want to offer my condolences again to all UN and humanitarian staff who have been killed in this conflict, including 273 members of your team, Philippe.

President, after 15 months of conflict, we now stand at a rare moment of hope for Palestinians and Israelis. Thanks to the tireless efforts of the United States, Qatar and Egypt we have a ceasefire deal that has seen seven hostages returned, reunited with their families and an end to the violence in Gaza that has claimed so many Palestinian lives.

We cannot and must not forget the suffering that has brought us to this moment. Lives brutally cut short by Hamas. Men, women and children abducted from their families – many of whom are still being held while their loved ones suffer in anguish.

This conflict has also seen over 47,000 Palestinians killed. At least 35,000 children are thought to have lost one or both parents. And an estimated 20% of the population has been left with lifelong disabilities.

The levels of destruction in Gaza are beyond belief.

We must turn the page on this cycle of violence. I want to highlight key actions to support this.

It is vital that we now see the release of all remaining hostages, and a sustained ceasefire to allow us to move from phase one of the agreement through to further phases. Only then can we achieve a lasting peace.

We welcome reports that there has been an increase in humanitarian aid into Gaza. This needs to be sustained and complemented by much-needed supplies of commercial goods.

To support this vital effort, my Minister for Development has today announced a further $21 million in funding to ensure healthcare, food and shelter reaches tens of thousands of civilians and to support vital infrastructure across the Occupied Palestinian Territories.

However, the implementation of Knesset legislation on UNRWA risks upending this humanitarian response as well as threatening the fragile and hard-won gains made through the ceasefire deal.

The vital work of UNRWA in ensuring that Palestinians have access to education and healthcare must also be protected in Gaza as well as the West Bank and East Jerusalem. These represent the most fundamental of human rights.

For this reason, the United Kingdom urges Israel, once again, to ensure that UNRWA can continue its lifesaving operations and provision of essential services across the Occupied Palestinian Territories.

We call on Israel to work urgently with international partners, including the UN, so there is no disruption to this vital work. Israel is obligated under international law to facilitate humanitarian assistance by all means at their disposal. We stand ready to work alongside Israel, the UN and our partners to assist.

We also call on UNRWA to continue to deliver their commitment to neutrality. Implementation of reforms to strengthen their neutrality remains critical. We welcome UNRWA’s commitment to fully investigate any allegations against their employees and the continued implementation of the Colonna Report’s recommendations. We have earmarked over $1.2 million of our funding to UNRWA to support their implementation.

President, the UK will play our full part in the coming days and weeks to seize the opportunity of this ceasefire for a better future. To ensure it leads to a credible pathway towards a two-state solution in which Israelis and Palestinians can live side by side in peace.

Thank you.

Published 28 January 2025

MIL OSI United Kingdom –

January 29, 2025

MIL-OSI United Nations: Deputy Secretary-General Tells Africa Energy Summit Policy Coherence, Finance, Transparent Cooperation Key to ‘Illuminate the Lives of Millions’

Source: United Nations General Assembly and Security Council

Following are UN Deputy Secretary-General Amina Mohammed’s remarks to the panel on “Policies and Reforms for Transforming African Energy” at the Mission 300 Africa Energy Summit, in Dar es Salaam today:

I want to start by thanking the Government of Tanzania and the African Union for its leadership, and the World Bank, the African Development Bank and the Mission 300 partners for convening this summit.

Mission 300 has undertaken an enormous task: to help close the energy access gap and unlock sustainable development across the continent by delivering electricity to 300 million Africans by 2030. As we have heard, we face a stark reality: 685 million people across the continent still lack access to electricity, with the gap widening as population growth outpaces new electricity connections.

And yet, Africa is richly endowed with natural resources vital for renewable energy technologies: it is home to 60 per cent of the world’s best solar resources and possesses vast wind, hydro and geothermal potential. And critical minerals mined in Africa are powering the renewables revolution around the world.

Despite this abundance, and record global investments in renewable energies worldwide, Africa continues to be left behind and many Africans continue to lack access to clean, affordable energy. This injustice must be urgently resolved. Access to electricity is an essential development requirement, one that can also be the multiplier for acceleration in building a sustainable future for all.

Providing clean energy to local communities represents a unique opportunity to improve health, widen access to education and social protection, make food systems resilient and create green jobs, e-commerce and financial services, while at the same time protecting the environment and biodiversity.

We have heard our distinguished speakers discuss why companies and Governments should get involved. The business case is clear: the falling costs of renewables and storage offer a great opportunity to deliver access to energy, energy security and sovereignty and climate resilience.

With the new African Continental Free Trade Area, aiming at a trade zone without barriers to the transfer of goods and services, the business opportunities will further multiply if the right policy environments — coherent and predictable — are put in place.

As we move into discussing what policies and reforms for transforming African energy can enable millions to access energy, I would like to focus on three areas of urgent attention for policymakers.

First, fostering policy coherence. We are five years away from the target of our SDGs [Sustainable Development Goals], and we are not on track. Policymakers and the international institutions need to strive to ensure sector-wide plans are coherent and aligned with the achievement of the SDGs due in 2030, while investors need robust regulatory laws in place to ensure business can operate aligned with them.

At this Summit, Mission 300 target countries are presenting their first national energy strategies for achieving universal energy access. These strategies need to be part of a broader plan, one that — while achieving universal energy access — needs to be aligned with the new economy-wide national climate action plans, or NDCs, consistent with 1.5°C, well before COP 30 [the 2025 United Nations Climate Change Conference] in November.

NDCs represent a unique opportunity for all countries to align their new climate plans and energy strategies, together with addressing adaptation needs. NDCs must coordinate the transition from fossil fuels with scaling of renewables and grid modernization and expansion, ensuring energy security and affordability. And they must be anchored in justice — providing support for affected workers and communities.

If done right, climate plans align with national development priorities and double as investment plans — becoming blueprints for a more sustainable and prosperous future. The Secretary-General’s panel on critical energy transition minerals offers important principles and actionable recommendations to ensure this new era does not repeat historical patterns of exploitation. SEforALL [Sustainable Energy for All], UN Resident Coordinators and country teams will continue to support country-level policy reforms, integrate stakeholder innovations, build institutional capacities and boost infrastructure investments across the entire clean-energy supply chain.

Second, mobilizing finance and support. While private-sector investments and innovation are important, public financing remains vital — especially in modernizing grid infrastructure to expand access and integrate renewables. Blending concessional public funds with commercial funds can help multiply renewable-energy investments in developing countries. We must work to strengthen the health of Africa’s public finances and tackle unsustainable debt burdens that are crowding out essential public investments.

The fourth International Conference on Financing for Development, that will take place in July to underpin the needs for long-term concessional finance, and the 1.3 trillion roadmap, agreed in Baku, that needs to be delivered by COP 30 in Brazil, must provide investments to scale up, among others, the energy transition.

Third, enhancing transparent international cooperation. International investments and cross-border partnerships hold the key to delivering electricity projects at a massive scale. Institutions must be strengthened to operate in complex regulatory environments, with multiple actors across jurisdictions.

Public-private partnerships need to be subject to stable and transparent public procurement rules throughout the whole project cycle — rules that prioritize long-term sustainability and allow for mutually beneficial contractual relationships. Transparency and accountability should be a hallmark of Mission 300 and set a new standard for cooperation across the continent.

As we start the five-year countdown to delivering on the Sustainable Development Goals, and mark the ten-year anniversary of the Paris Agreement, let us work together to illuminate the lives of millions, power the industries of tomorrow and ensure that no one is left behind in the race to deliver universal clean energy, climate resilience and economic prosperity.

MIL OSI United Nations News –

January 29, 2025

MIL-OSI: Philadelphia Union & Atomic Data Announce Multi-Year Partnership Extension

Source: GlobeNewswire (MIL-OSI)

CHESTER, Pa. and MINNEAPOLIS, Jan. 28, 2025 (GLOBE NEWSWIRE) — Philadelphia Union and Atomic Data announced today that they have extended their partnership for five more years, bringing a wide range of managed IT services to the Major League Soccer Club through 2029. Under the official IT partnership, Atomic Data and Game Day Technologies will continue to oversee all of the Union’s IT operations and security measures.

“We are excited to announce the extension of our multi-year partnership with Atomic Data,” said Chief Revenue Officer Charlie Slonaker. “Since our collaboration began in 2022, Atomic Data has significantly enhanced our technology operations and IT resources. Their 24×7 support has been instrumental in helping us achieve several key club goals. We look forward to continuing to develop innovative strategies to drive growth over the next five years.”

As the official IT provider for Philadelphia Union, Subaru Park, & WSFS Bank Sportsplex, Atomic Data manages their servers and endpoints, monitors their network around the clock, and provides 24×7 end-user help desk support. They also strengthen the team’s cybersecurity with advanced tools and offer on-site tech support for the organization as needed.

Atomic Data’s Yagya Mahadevan, head of sports and entertainment division Game Day Technologies, commented: “This multi-year extension reaffirms the strong partnership we’ve built with Philadelphia Union over the past three years, and we’re thrilled to enter the next phase. Looking ahead, we’re committed to helping Philadelphia Union implement robust processes to enhance their technology operations and deliver world-class infrastructure for the WSFS Bank Sportsplex.”

About Atomic Data & Game Day Technologies
Atomic Data, trusted IT provider for hundreds of enterprises, sports teams, and large venues, is on a mission to deliver always-on, custom-tailored technology solutions and objective IT leadership.

Game Day Technologies® powered by Atomic Data enables owners and teams to right size and modernize their venues, districts, training facilities, and back offices with objective, holistic technology oversight and activation.

For more information, please visit www.philadelphiaunion.com.

The MIL Network –

January 29, 2025

MIL-OSI Banking: Media advisory: Corruption Perceptions Index to be published on 11 February 2025

Source: Transparency International

Transparency international will release its 2024 Corruption Perceptions Index on Tuesday, 11 February 2025 at 6:01 CET (12:01 EST).

The Corruption Perceptions Index (CPI) is the leading global indicator of public sector corruption, providing an annual comparative snapshot of 180 countries and territories. The index for 2024 is calculated using data from 13 external sources.

Watch the CPI explainer video

The 2024 CPI edition assesses how countries have responded to corruption over time, reviewing progress and failures in the past year, while focusing particularly on how corruption is undermining climate action around the world. It shows how the biggest recipients of climate finance are facing governance and corruption challenges and that undue influence from the fossil fuel industry is limiting the ambition of wealthy nations to tackle climate change.

2024 Corruption Perceptions Index

11 February 2025 at 06:01 CET

Published online at  www.transparency.org/cpi/

Embargoed materials will be available on Tuesday, 4 February. To request interviews or press materials under embargo until publication, please email Felix Arbenz-Caines at di:ga Communications [email protected] or the press office at Transparency International Secretariat [email protected].

For national enquiries, please contact the appropriate Transparency International chapter.

MIL OSI Global Banks –

January 29, 2025

MIL-OSI United Kingdom: Reappointment of Ofgem Chief Executive

Source: United Kingdom – Executive Government & Departments 2

Jonathan Brearley reappointed as Chief Executive Officer of Ofgem.

Energy Secretary Ed Miliband has today (14 January 2025) confirmed the reappointment of Jonathan Brearley as Chief Executive Officer of Ofgem.

The reappointment will run from 1 February 2025 until 31 January 2030.

The Secretary of State has also extended the terms of 2 non-executive directors – Myriam Madden to 31 March 2025 and Barry Panayi to 16 March 2027.

Biographies

Jonathan Brearley – Chief Executive Officer

Jonathan Brearley was appointed as an executive member of the Ofgem Board in 2018. Jonathan became Ofgem’s Chief Executive Officer on 3 February 2020. This follows his previous appointment as Executive Director for Systems and Networks in April 2018.

He has wide-ranging energy sector experience, having led Electricity Market Reform as the Director for Energy Markets and Networks at the Department of Energy and Climate Change (DECC).

Prior to this, he was Director of the Office of Climate Change, a cross-government strategy unit focussed on climate change and energy issues, where he led the development of the Climate Change Act. Earlier in his career, Jonathan was a senior adviser in the Prime Minister’s Strategy Unit.

Appointed: 3 February 2020
Reappointed: 1 February 2025
Term ends: 31 March 2025

Myriam Madden – Non-Executive Director

Myriam was appointed to the Ofgem Board in January 2020. She has held senior executive finance and operational positions in global technology companies, financial services in the UK, US and Europe, as well as the public sector. An experienced Executive Director, Myriam specialised in business transformation, operational restructuring and finance in both the private and public sectors.

Myriam is a chartered management accountant and a Board member of the International Ethics Standards Board for Accountants (IESBA). She is a Board member of Home Group, chairman of their Scottish subsidiary, a board member of the Traverse Theatre and chairman of their Audit committee.

Myriam previously served as a non-executive member of the Audit and Risk Assurance Committee of BEIS. She was also a Board member of the American Institute of Certified Public Accountants and President of the Chartered Institute of Management Accountants, both global accounting bodies.

Appointed: 1 January 2020
Extended: 1 February 2025
Term ends: 31 January 2030

Barry Panayi Madden – Non-Executive Director

Barry was appointed to the Ofgem Board in March 2020. He specialises in data and digital transformation and has worked in data for the whole of his career. He is currently Chief Data and Insight Officer for John Lewis.

Prior to John Lewis, Barry spent the majority of his early career at Ernst & Young helping to lead the data and analytics practice and has subsequently headed up data and digital teams in organisations such as Bupa, Virgin and Lloyds Banking Group.

Appointed: 16 March 2020
Extended: 1 February 2025
Term ends: 16 March 2027

Published 14 January 2025

MIL OSI United Kingdom –

January 29, 2025

MIL-OSI: Summit State Bank Reports Fourth Quarter 2024 Financial Results

Source: GlobeNewswire (MIL-OSI)

SANTA ROSA, Calif., Jan. 28, 2025 (GLOBE NEWSWIRE) — Summit State Bank (the “Bank”) (Nasdaq: SSBI) today reported a net loss of $6,605,000, or $0.98 loss per diluted share for the fourth quarter ended December 31, 2024, compared to net income of $1,901,000, or $0.28 per diluted share for the fourth quarter ended December 31, 2023. The current quarter’s results were impacted by expenses including a $6,646,000 provision for credit losses on loans and a $4,119,000 one-time non-cash impairment charge to write off the remaining balance of goodwill. The Bank has taken significant charge offs and provisions for credit losses in the fourth quarter of 2024 as a proactive step towards resolving its problem loans. The goodwill impairment was a result of the Bank’s stock price trading below book value and is a non-cash charge that does not impact the Bank’s cash flows, liquidity, or regulatory capital. The Bank ended the year with improved regulatory capital ratios and is focused on expanding net interest margin in 2025.

For the year ended December 31, 2024, the Bank reported a net loss of $3,656,000, or $0.54 loss per diluted share compared to net income of $10,822,000, or $1.62 per diluted share for the year ended December 31, 2023. The 2024 net income loss was primarily attributable to annual provision for credit losses on loans totaling $7,958,000 and a one-time non-cash goodwill impairment expense of $4,119,000.

Pre-tax, pre-provision net income before goodwill¹ was $2,994,000 for the quarter ended December 31, 2024, compared to $2,122,000, $1,267,000, $1,955,000 and $2,643,000 for the quarters ended September 30, 2024, June 30, 2024, March 31, 2024, and December 31, 2023, respectively. “At the beginning of 2024, the Bank was negatively impacted by the ongoing strains that the high-interest rate environment put on our funding costs,” said Brian Reed, President and CEO. “By the fourth quarter of 2024, the Bank’s core operating results improved due to a lower cost of funds and improved noninterest income.”

“The Bank continues to focus on maintaining strong capital levels and did that effectively in 2024 by strategically managing the balance sheet and suspending cash dividends.
As such, the Board determined it will also suspend cash dividends in the first quarter of 2025 so that we can build capital, increase liquidity, and position the Bank to create long-term value for our shareholders.”

“The largest negative impact on the Bank’s performance in 2024 was a result of the heightened level of non-performing assets,” said Reed. “We have been aggressively pursuing solutions to these problem loans and have reduced our non performing loans by $9,160,000 in the fourth quarter of 2024. We anticipate non performing loans will be further reduced by $18,187,000 in the first half of 2025 as a result of loan payoffs from the sale of collateral that is currently under contract to be sold.”

“We are headed into 2025 feeling positive about our prospects subsequent to our significant progress in resolving problem loans. We continue to maintain our well capitalized status and sufficient liquidity after having realized successive quarters of improved net operating income results,” concluded Reed.

Fourth Quarter 2024 Financial Highlights (at or for the three months ended December 31, 2024)

The Bank’s Tier 1 Leverage ratio increased to 8.92% at December 31, 2024 compared to 8.85% at December 31, 2023. This ratio remains above the minimum of 5% required to be considered “well-capitalized” for regulatory capital purposes.
The Bank has implemented numerous operating cost saving initiatives including an 8% reduction in force.
The Bank’s annualized loss on average assets and annualized loss on average equity for the fourth quarter of 2024 was 2.39% and 25.94%, respectively. The pre-tax, pre-provision return on average assets before goodwill¹ and pre-tax, pre-provision return on average equity before goodwill¹ in the fourth quarter would have been 1.08% and 11.76%, respectively.
Net income was a loss of $6,605,000 for the fourth quarter of 2024. Pre-tax, pre-provision net income before goodwill¹ was $2,994,000 for the fourth quarter of 2024 compared to $2,122,000, $1,267,000, $1,955,000 and $2,643,000 for the quarters ended September 30, 2024, June 30, 2024, March 31, 2024, and December 31, 2023, respectively.
Collateral relating to two of the non performing loans is in contract to sell in the first half of 2025 and the expected proceeds represent 65% or $18,010,000 of the remaining $27,754,000 of non performing loans.
The allowance for credit losses to total loans was 1.50% after charging off $8,343,000 and recording a $6,646,000 provision for credit losses to replenish reserves on December 31, 2024.
The Bank maintained strong total liquidity of $435,409,000, or 40.8% of total assets as of December 31, 2024. This includes on balance sheet liquidity (cash and equivalents and unpledged available-for-sale securities) of $111,471,000 or 10.4% of total assets, plus available borrowing capacity of $323,938,000 or 30.3% of total assets.
The Bank has been strategically managing its loan and deposit portfolios to reduce risk in the balance sheet and improve capital ratios. The Bank has been successful in reducing the size of its balance sheet as noted below:
- Net loans decreased $33,627,000 to $904,999,000 at December 31, 2024, compared to $938,626,000 one year earlier and decreased $12,368,000 compared to $917,367,000 three months earlier.
- Total deposits decreased 5% to $962,562,000 at December 31, 2024, compared to $1,009,693,000 at December 31, 2023, and decreased 4% when compared to the prior quarter end of $1,002,770,000.
Book value was $13.61 per share, compared to $14.40 per share a year ago and $14.85 in the preceding quarter.

Operating Results

For the fourth quarter of 2024, the annualized loss on average assets was 2.39% and the annualized loss on average equity was 25.94%. This compared to an annualized return on average assets of 0.67% and an annualized return on average equity of 8.02%, respectively, for the fourth quarter of 2023. These ratios were negatively impacted during the fourth quarter of 2024 by a credit loss provision and one-time goodwill impairment. Without the impact from these items, the pre-tax, pre-provision return on average assets before goodwill¹ and the pre-tax, pre-provision return on average equity before goodwill¹ would have been 1.08% and 11.76%, respectively, for the three months ended December 31, 2024.

For the year ended 2024, the loss on average assets was 0.37% and the loss on average equity was 3.69%. This compares to the return on average assets of 0.95% and return on average equity of 11.56%, respectively, for the year ended 2023.

The Bank’s net interest margin was 2.88% in the fourth quarter of 2024 compared to its lowest quarterly net interest margin this year of 2.71% which occurred in the second and third quarters of 2024. The current net interest margin is also higher compared to the fourth quarter of 2023 of 2.85%. This was primarily attributable to the cost of deposits decreasing in the fourth quarter of 2024 to 2.87% compared to 3.05% during the preceding quarter. “We are starting to see an improvement in cost of funds in response to the Federal Reserve rate decreases. As CDs mature, we expect to see continued improvement in deposit pricing in the near future,” said Reed. “In addition, loan yields have started to improve as our existing loans have started to reprice.”

Interest and dividend income decreased 1.0% to $14,935,000 in the fourth quarter of 2024 compared to $15,036,000 in the fourth quarter of 2023. The decrease in interest income is attributable to a $182,000 decrease in interest on investment securities and a $137,000 decrease in interest on deposits with banks offset by an increase of $214,000 in interest and fees on loans.

Noninterest income increased in the fourth quarter of 2024 to $1,373,000 compared to $297,000 in the fourth quarter of 2023. The increase is primarily attributed to the Bank recognizing $857,000 in gains on sales of SBA guaranteed loan balances in the fourth quarter of 2024 compared to no gains on sales of SBA guaranteed loan balances in the fourth quarter of 2023.

Operating expenses increased in the fourth quarter of 2024 to $10,200,000 compared to $5,483,000 in the fourth quarter of 2023. The increase is primarily due to a one-time non-cash impairment charge of $4,119,000 to write off the remaining balance of goodwill. In addition, the Bank recorded a $443,000 loss related to an external check fraud event during the fourth quarter of 2024. The Bank has filed an insurance claim related to this fraud loss and may be partially reimbursed by insurance at a later date.

“We remain focused on enhancing revenue generation and driving significant cost efficiencies to improving our operational effectiveness. To date we have leveraged existing staff and technologies to reduce third-party expenses, eliminated raises and bonuses, reduced employee benefits Bank-wide, and reduced director fees.”

Balance Sheet Review

During 2024, the Bank strategically managed its loan and deposit portfolios to reduce risk in the balance sheet and improve capital ratios. As a result of the efforts, net loans decreased 4% to $904,999,000 and total deposits also decreased 5% to $962,562,000 as of December 31, 2024 compared to December 31, 2023.

Net loans were $904,999,000 at December 31, 2024 compared to $938,626,000 at December 31, 2023, and decreased 1% compared to September 30, 2024. The Bank’s largest loan types are commercial real estate loans which make up 78% of the portfolio, “secured by farmland” totaling 9% of the portfolio, and 7% in commercial and industrial loans. Of the commercial real estate total, approximately 34% or $231,000,000 is owner occupied and the remaining 66% or $451,000,000 is non-owner occupied. The Bank’s entire loan portfolio is well diversified between industries including office space which totals $116,400,000.

Total deposits were $962,562,000 at December 31, 2024 compared to $1,009,693,000 at December 31, 2023, and decreased 4% compared to the prior quarter end. At December 31, 2024, noninterest bearing demand deposit accounts decreased 8% compared to a year ago and represented 19% of total deposits; savings, NOW and money market accounts decreased 9% compared to a year ago and represented 49% of total deposits, and CDs increased 4% compared to a year ago and comprised 32% of total deposits.

Shareholders’ equity was $92,261,000 at December 31, 2024, compared to $100,662,000 three months earlier and $97,678,000 a year earlier. The decrease in shareholders’ equity compared to a year ago was due to a reduction in retained earnings. At December 31, 2024 book value was $13.61 per share, compared to $14.85 three months earlier, and $14.40 at December 31, 2023.

The Bank’s Tier 1 Leverage ratio continues to exceed the minimum of 5% necessary to be categorized as “well-capitalized” for regulatory capital purposes. The Tier-1 leverage ratio at the end of 2024 was 8.92%, an increase compared to 8.85% at the end of 2023.

Credit Quality

“Our primary focus remains on managing asset quality and reducing portfolio risk,” said Reed. “To that end we charged off loans of $8,343,000 and recorded a $6,646,000 provision for credit losses to replenish reserves during the fourth quarter of 2024. Three credits represent 94% or $26,040,000 of our non performing loans and are “secured by farmland” which have been hit hard by the current environment. The bank holds a small portion of its total loans in this industry and actively monitors the performance of these loans. Collateral relating to two of these three non performing loans is in contract to sell in the first half of 2025 and represents 65% or $18,010,000 of the non performing portfolio. The remaining non performing loans are being reserved at current appraisal value less selling cost.”

Non performing assets were $32,884,000, or 3.08% of total assets, at December 31, 2024. This compared to $41,971,000 in non performing assets at September 30, 2024, and $44,206,000 in non performing assets at December 31, 2023. Non performing assets include $5,130,000 for one other real estate owned loan at December 31, 2024 and September 30, 2024, compared to no other real estate owned loans at December 31, 2023.

There were $8,343,000 in net charge-offs during the three months ended December 31, 2024, compared to no charge-offs during the three months ended September 30, 2024 and net recoveries of $9,000 during the three months ended December 31, 2023.

For the fourth quarter of 2024, consistent with factors within the allowance for credit losses model, the Bank recorded a $6,646,000 provision for credit loss expense for loans, a $8,000 provision for credit losses for unfunded loan commitments and a $2,000 reversal of credit losses on investments. This compared to a $31,000 reversal of credit loss expense on loans, a $65,000 reversal of credit losses on unfunded loan commitments and a $31,000 provision for credit losses on investments in the fourth quarter of 2023.

The allowance for credit losses to total loans was 1.50% on December 31, 2024, and 1.60% on December 31, 2023. The decrease is due to $9,690,000 in loan charge-offs offset with a provision for credit losses on loans of $7,958,000 and $91,000 reversal of credit losses on unfunded loan commitments recorded during the year ended December 31, 2024.

About Summit State Bank

Founded in 1982 and headquartered in Sonoma County, Summit State Bank is an award-winning community bank serving the North Bay. The Bank serves small businesses, nonprofits and the community, with total assets of $1.1 billion and total equity of $92 million as of December 31, 2024. The Bank has built its reputation over the past 40 years by specializing in providing exceptional customer service and customized financial solutions to aid in the success of its customers.

Summit State Bank is committed to embracing the diverse backgrounds, cultures and talents of its employees to create high performance and support the evolving needs of its customers and community it serves. Through the engagement of its team, Summit State Bank has received many esteemed awards including: Top Performing Community Bank by American Banker, Best Places to Work in the North Bay and Diversity in Business by North Bay Business Journal, Corporate Philanthropy Award by the San Francisco Business Times, and Hall of Fame by North Bay Biz Magazine. Summit State Bank’s stock is traded on the Nasdaq Global Market under the symbol SSBI. Further information can be found at www.summitstatebank.com.

Cautionary Note Regarding Preliminary Financial Results and Forward-looking Statements

The financial results in this release are preliminary and unaudited. Final audited financial results and other disclosures will be reported in Summit State Bank’s annual report on Form 10-K for the period ended December 31, 2024 and may differ materially from the results and disclosures in this release due to, among other things, the completion of final review procedures, the occurrence of subsequent events or the discovery of additional information.

Except for historical information, the statements contained in this release, are forward-looking statements within the meaning of the “safe harbor” provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are non-historical statements regarding management’s expectations and beliefs about the Bank’s future financial performance and financial condition and trends in its business and markets. Words such as “expects,” “anticipates,” “believes,” “estimates” and similar expressions or future or conditional verbs such as “will,” “should,” “would” and “could” are intended to identify such forward-looking statements. Examples of forward-looking statements include but are not limited to statements regarding future operating results, operating improvements, loans sales and resolutions, cost savings, insurance recoveries and dividends. The forward-looking statements in this release are based on current information and on assumptions about future events and circumstances that are subject to a number of risks and uncertainties that are often difficult to predict and beyond the Bank’s control. As a result of those risks and uncertainties, the Bank’s actual future results and outcomes could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this release. Those risks and uncertainties include, but are not limited to, the risk of incurring credit losses; the quality and quantity of deposits; the market for deposits, adverse developments in the financial services industry and any related impact on depositor behavior or investor sentiment; risks related to the sufficiency of the Bank’s liquidity; fluctuations in interest rates; governmental regulation and supervision; the risk that the Bank will not maintain growth at historic rates or at all; general economic conditions, either nationally or locally in the areas in which the Bank conducts its business; risks associated with changes in interest rates, which could adversely affect future operating results; the risk that customers or counterparties may not performance in accordance with the terms of credit documents or other agreements due a decline in credit worthiness, business conditions or other reasons;; adverse conditions in real estate markets; and the inherent uncertainty of expectations regarding litigation, insurance claims and the performance or resolution of loans. Additional information regarding these and other risks and uncertainties to which the Bank’s business and future financial performance are subject is contained in the Bank’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and other documents the Bank files with the FDIC from time to time. Readers should not place undue reliance on the forward-looking statements, which reflect management’s views only as of the date of this release. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

¹Non-GAAP Financial Measures

This release contains non-GAAP (Generally Accepted Accounting Principles) financial measures in addition to the results presented in accordance with GAAP. These Non-GAAP financial measures include pre-tax, pre-provision net operating income before goodwill, pre-tax, pre-provision return on average assets before goodwill (“ROAA”), and pre-tax, pre-provision return on average equity (“ROAE”) before goodwill. We believe the presentation of these non-GAAP financial measures, provides useful information to assess our consolidated financial condition and consolidated results of operations and to assist investors in evaluating our financial results relative to our history results and those of our peers.

Not all companies use identical calculations or the same definitions of pre-tax, pre-provision net operating income before goodwill, pre-tax, pre-provision ROAA before goodwill and pre-tax, pre-provision ROAE before goodwill, so the presentation of these non-GAAP financial measures may not be comparable to other similarly titled measures used by other companies. These non-GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. These non-GAAP financial measures should be taken together with the corresponding GAAP measure and should not be considered a substitute for the GAAP measure. Reconciliations of the most directly comparable GAAP measures to these non-GAAP financial measurements are presented below.

Contact: Brian Reed, President and CEO, Summit State Bank (707) 568-4908


	Three Months Ended

	December 31, 2024			September 30, 2024		June 30, 2024			March 31, 2024			December 31, 2023
	(In thousands)
Reconciliation of non-GAAP pre-tax, pre-provision income net of goodwill

Net (loss) income	$	(6,605	)	$	626	$	928		$	1,395		$	1,901
Excluding provision for (reversal of) credit losses		6,652			1,294		(16	)		(85	)		(65	)
Excluding (reversal of) provision for income taxes		(1,172	)		202		355			645			807
Pre-tax, pre-provision income (non-GAAP)	$	(1,125	)	$	2,122	$	1,267		$	1,955		$	2,643

Excluding goodwill impairment		4,119			–		–			–			–
Pre-tax, pre-provision income net of goodwill (non-GAAP)	$	2,994		$	2,122	$	1,267		$	1,955		$	2,643



	Three Months Ended

	December 31, 2024			September 30, 2024		June 30, 2024			March 31, 2024			December 31, 2023
	(In thousands)
Reconciliation of non-GAAP return on average assets

Average assets	$	1,098,890		$	1,098,469	$	1,078,700		$	1,087,960		$	1,123,057
(Loss) return on average assets (1)		-2.39%			0.23%		0.35%			0.51%			0.67%

Net (loss) income	$	(6,605	)	$	626	$	928		$	1,395		$	1,901
Excluding provision for (reversal of) credit losses		6,652			1,294		(16	)		(85	)		(65	)
Excluding (reversal of) provision for income taxes		(1,172	)		202		355			645			807
Pre-tax, pre-provision income (non-GAAP)	$	(1,125	)	$	2,122	$	1,267		$	1,955		$	2,643

Excluding goodwill impairment		4,119			–		–			–			–
Pre-tax, pre-provision income net of goodwill (non-GAAP)	$	2,994		$	2,122	$	1,267		$	1,955		$	2,643

Adjusted return on average assets (non-GAAP) (1)		1.08%			0.77%		0.47%			0.72%			0.93%

(1) Annualized.

	Three Months Ended

	December 31, 2024			September 30, 2024		June 30, 2024			March 31, 2024			December 31, 2023
	(In thousands)
Reconciliation of non-GAAP return on average shareholders’ equity

Average shareholders’ equity	$	101,313		$	99,962	$	97,548		$	97,471		$	94,096
(Loss) return on average shareholders’ equity (1)		-25.94%			2.48%		3.82%			5.74%			8.02%

Net (loss) income	$	(6,605	)	$	626	$	928		$	1,395		$	1,901
Excluding provision for (reversal of) credit losses		6,652			1,294		(16	)		(85	)		(65	)
Excluding (reversal of) provision for income taxes		(1,172	)		202		355			645			807
Pre-tax, pre-provision income (non-GAAP)	$	(1,125	)	$	2,122	$	1,267		$	1,955		$	2,643

Excluding goodwill impairment		4,119			–		–			–			–
Pre-tax, pre-provision income net of goodwill (non-GAAP)	$	2,994		$	2,122	$	1,267		$	1,955		$	2,643

Adjusted return on average shareholders’ equity (non-GAAP) (1)		11.76%			8.42%		5.21%			8.04%			11.14%

(1) Annualized.


SUMMIT STATE BANK
STATEMENTS OF INCOME
(In thousands except earnings per share data)

	Three Months Ended						Year Ended
	December 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)

Interest and dividend income:
Interest and fees on loans	$	13,623		$	13,409		$	53,574		$	52,560
Interest on deposits with banks		655			792			2,060			4,410
Interest on investment securities		530			712			2,614			2,855
Dividends on FHLB stock		127			123			514			416
Total interest and dividend income		14,935			15,036			58,762			60,241
Interest expense:
Deposits		7,099			7,113			28,495			24,227
Federal Home Loan Bank advances		6			–			337			177
Junior subordinated debt		128			94			454			375
Total interest expense		7,233			7,207			29,286			24,779
Net interest income before provision for credit losses		7,702			7,829			29,476			35,462
Provision for (reversal of) credit losses on loans		6,646			(31	)		7,958			342
Provision for (reversal of) credit losses on unfunded loan commitments		8			(65	)		(91	)		(68	)
(Reversal of) provision for credit losses on investments		(2	)		31			(22	)		58
Net interest income after provision for (reversal of) credit
losses, unfunded loan commitments and investments		1,050			7,894			21,631			35,130
Non-interest income:
Service charges on deposit accounts		225			219			926			872
Rental income		61			54			241			193
Net gain on loan sales		857			–			2,114			2,481
Net gain on securities		6			–			6			–
FHLB prepayment fee		–			–			–			1,024
Other income		224			24			865			631
Total non-interest income		1,373			297			4,152			5,201
Non-interest expense:
Salaries and employee benefits		3,429			3,044			15,639			15,399
Occupancy and equipment		413			386			1,761			1,713
Goodwill impairment		4,119			–			4,119			–
Other expenses		2,239			2,053			7,889			7,938
Total non-interest expense		10,200			5,483			29,408			25,050
(Loss) income before provision for income taxes		(7,777	)		2,708			(3,625	)		15,281
(Reversal of) provision for income taxes		(1,172	)		807			31			4,459
Net (loss) income	$	(6,605	)	$	1,901		$	(3,656	)	$	10,822

Basic (loss) earnings per common share	$	(0.98	)	$	0.28		$	(0.54	)	$	1.62
Diluted (loss) earnings per common share	$	(0.98	)	$	0.28		$	(0.54	)	$	1.62

Basic weighted average shares of common stock outstanding		6,719			6,698			6,714			6,695
Diluted weighted average shares of common stock outstanding		6,719			6,698			6,714			6,698

SUMMIT STATE BANK
BALANCE SHEETS
(In thousands except share data)

	December 31, 2024		December 31, 2023
	(Unaudited)		(Unaudited)

ASSETS

Cash and due from banks	$	51,403	$	57,789
Total cash and cash equivalents		51,403		57,789

Investment securities:
Available-for-sale, less allowance for credit losses of $36 and $58
(at fair value; amortized cost of $80,887 in 2024 and $97,034 in 2023)		68,228		84,546

Loans, less allowance for credit losses of $13,769 in 2024 and $15,221 in 2023		904,999		938,626
Bank premises and equipment, net		5,155		5,316
Investment in Federal Home Loan Bank (FHLB) stock, at cost		5,889		5,541
Goodwill		–		4,119
Other real estate owned		5,130		–
Affordable housing tax credit investments		7,484		8,405
Accrued interest receivable and other assets		19,269		18,166

Total assets	$	1,067,557	$	1,122,508

LIABILITIES AND
SHAREHOLDERS’ EQUITY

Deposits:
Demand – non interest-bearing	$	185,756	$	201,909
Demand – interest-bearing		193,355		244,748
Savings		47,235		54,352
Money market		226,879		212,278
Time deposits that meet or exceed the FDIC insurance limit		70,717		63,159
Other time deposits		238,620		233,247
Total deposits		962,562		1,009,693

FHLB advances		–		–
Junior subordinated debt, net		5,935		5,920
Affordable housing commitment		583		4,094
Accrued interest payable and other liabilities		6,216		5,123

Total liabilities		975,296		1,024,830

Total shareholders’ equity		92,261		97,678

Total liabilities and shareholders’ equity	$	1,067,557	$	1,122,508


Financial Summary
(In thousands except per share data)

	As of and for the						As of and for the
	Three Months Ended						Year Ended
	December 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Statement of Income Data:
Net interest income	$	7,702		$	7,829		$	29,476		$	35,462
Provision for (reversal of) credit losses on loans		6,646			(31	)		7,958			342
Provision for (reversal of) credit losses on unfunded loan commitments		8			(65	)		(91	)		(68	)
(Reversal of) provision for credit losses on investments		(2	)		31			(22	)		58
Non-interest income		1,373			297			4,152			5,201
Non-interest expense		10,200			5,483			29,408			25,050
(Reversal of) provision for income taxes		(1,172	)		807			31			4,459
Net (loss) income	$	(6,605	)	$	1,901		$	(3,656	)	$	10,822

Selected per Common Share Data:
Basic earnings per common share	$	(0.98	)	$	0.28		$	(0.54	)	$	1.62
Diluted earnings per common share	$	(0.98	)	$	0.28		$	(0.54	)	$	1.62
Dividend per share	$	–		$	0.12		$	0.28		$	0.48
Book value per common share (1)	$	13.61		$	14.40		$	13.61		$	14.40

Selected Balance Sheet Data:
Assets	$	1,067,557		$	1,122,508		$	1,067,557		$	1,122,508
Loans, net		904,999			938,626			904,999			938,626
Deposits		962,562			1,009,693			962,562			1,009,693
Average assets		1,098,890			1,123,057			1,091,047			1,142,790
Average earning assets		1,064,872			1,089,808			1,058,766			1,110,801
Average shareholders’ equity		101,313			94,096			99,082			93,621
Nonperforming loans		27,754			44,206			27,754			44,206
Other real estate owned		5,130			–			–			–
Total nonperforming assets		32,884			44,206			32,884			44,206

Selected Ratios:
(Loss) return on average assets (2)		-2.39	%		0.67	%		-0.34	%		0.95	%
(Loss) return on average shareholders’ equity (2)		-25.94	%		8.02	%		-3.69	%		11.56	%
Efficiency ratio (3)		112.47	%		67.47	%		87.47	%		61.60	%
Net interest margin (2)		2.88	%		2.85	%		2.78	%		3.19	%
Common equity tier 1 capital ratio		10.19	%		9.90	%		10.19	%		9.90	%
Tier 1 capital ratio		10.19	%		9.90	%		10.19	%		9.90	%
Total capital ratio		11.94	%		11.75	%		11.94	%		11.75	%
Tier 1 leverage ratio		8.92	%		8.85	%		8.92	%		8.85	%
Common dividend payout ratio (4)		0.00	%		42.63	%		-51.81	%		30.05	%
Average shareholders’ equity to average assets		9.22	%		8.38	%		9.08	%		8.19	%
Nonperforming loans to total loans		3.02	%		4.63	%		3.02	%		4.63	%
Nonperforming assets to total assets		3.08	%		3.94	%		3.08	%		3.94	%
Allowance for credit losses to total loans		1.50	%		1.60	%		1.50	%		1.60	%
Allowance for credit losses to nonperforming loans		49.61	%		34.43	%		49.61	%		34.43	%

(1) Total shareholders’ equity divided by total common shares outstanding.
(2) Annualized.
(3) Non-interest expenses to net interest and non-interest income, net of securities gains.
(4) Common dividends divided by net (loss) income available for common shareholders.

The MIL Network –

January 29, 2025

MIL-OSI: Jeremy Michael Joins Guggenheim Securities to Expand Energy Investment Banking Practice

Source: GlobeNewswire (MIL-OSI)

NEW YORK, Jan. 28, 2025 (GLOBE NEWSWIRE) — Guggenheim Securities, the investment banking and capital markets division of Guggenheim Partners, announced today that Jeremy Michael has joined the firm’s Energy, Power & Energy Transition investment banking business as a Senior Managing Director.

Mr. Michael brings more than two decades of investment banking experience to Guggenheim with a focus on upstream, midstream, and downstream energy. He joins the firm from Barclays where he served as Global Head of Natural Resources Investment Banking advising industry-leading companies and leading sector-defining transactions.

“We are pleased to welcome Jeremy to Guggenheim,” said Mark Van Lith, CEO of Guggenheim Securities. “Jeremy is a leading advisor in the energy sector and will play an important role as we continue to build our energy and power franchises. We look forward to his success at the firm.”

Mr. Michael earned his B.A. from Vanderbilt University.

About Guggenheim Securities

Guggenheim Securities is the investment banking and capital markets business of Guggenheim Partners, a global investment and advisory firm. Guggenheim Securities offers services that fall into four broad categories: Advisory, Financing, Sales and Trading, and Research. Guggenheim Securities is headquartered in New York, with additional offices in Atlanta, Boston, Chicago, Houston, London, Menlo Park, and San Francisco. For more information, please visit GuggenheimSecurities.com, follow us on LinkedIn or contact us at GSinfo@GuggenheimPartners.com or 212.518.9200.

About Guggenheim Partners

Guggenheim Partners is a diversified financial services firm that delivers value to its clients through two primary businesses: Guggenheim Investments, a premier global asset manager and investment advisor, and Guggenheim Securities, a leading investment banking and capital markets business. Guggenheim’s professionals are based in offices around the world, and our commitment is to deliver long-term results with excellence and integrity while advancing the strategic interests of our clients. Learn more at GuggenheimPartners.com, and follow us on LinkedIn and Twitter @GuggenheimPtnrs.

Media Contact

Steven Lee
Guggenheim Securities
212.293.2811
Steven.Lee@guggenheimpartners.com

The MIL Network –

January 29, 2025

MIL-OSI United Nations: WFP reaches hundreds of thousands of people in Gaza in first week of the ceasefire

Source: World Food Programme

Photo: WFP/Photolibrary. WFP distribution point operated at the Nusierat camp by WFP’s partner, Global Communities.

Photo credit

GAZA/CAIRO – The United Nations World Food Programme (WFP) reached more than 330,000 people in Gaza with food assistance in the first week of the ceasefire, providing food parcels, hot meals and cash assistance to war-weary families.

“The first week has brought hope, but it is still early days. We must keep up this momentum,” said Antoine Renard, WFP Country Director in Palestine. “And with so many people on the move now, keen to reach their homes and reunite with their families in the north, we need to make sure they have food wherever they are. WFP’s priority is to ensure assistance follows the people.”

Here are the latest updates on WFP operations in Gaza:

WFP has brought 10,130 metric tons of food into Gaza since the ceasefire. Food entered Gaza through all available corridors from Jordan, Israel and Egypt.
For the first time in months, families in Gaza are now receiving significantly more rations – two food parcels and a 25-kg bag of wheat flour.

In total, WFP reached more 330,000 people in the first week of the ceasefire with food parcels and hot meals.

WFP has also distributed nutrition products to 46,000 people, including children under 5 and pregnant and breastfeeding women.

If the ceasefire holds, WFP aims to reach one million people each month for the next three months. WFP has enough food pre-positioned along the borders and on its way to Gaza to feed over a million people with full rations for three months.

A cash assistance programme started on Monday, with 7,000 people reached on day one, and more than 32,000 as of today. This money will enable families to meet their basic needs – not only food – as they seek to relocate and rebuild. The aim is to reach 30,000 families (150,000 people) in one month.

Thanks to the influx of fresh supplies entering the Strip, WFP has also been able to get bakeries up and running in the south – eight old and 5 new ones – and prepare hot meals and deliver ready-to-eat meals to families in shelters.

The humanitarian situation in the West Bank is also critical. WFP is ready to provide voucher assistance to approximately 3,750 people in Jenin camp, allowing them to obtain food at a local retailer or receive food parcels. Additionally, cash assistance will be provided to 12,750 displaced households affected by military operations.

Download photos here

Download video footage here

# # #

The United Nations World Food Programme is the world’s largest humanitarian organization saving lives in emergencies and using food assistance to build a pathway to peace, stability and prosperity for people recovering from conflict, disasters and the impact of climate change.

Follow us on X, formerly Twitter, via @wfp_media

MIL OSI United Nations News –

January 29, 2025

MIL-OSI: Eagle Bancorp Montana Earns $3.4 Million, or $0.44 per Diluted Share, in the Fourth Quarter of 2024 and $9.8 Million, or $1.24 per Diluted Share for the Year 2024; Declares Quarterly Cash Dividend of $0.1425 Per Share

Source: GlobeNewswire (MIL-OSI)

HELENA, Mont., Jan. 28, 2025 (GLOBE NEWSWIRE) — Eagle Bancorp Montana, Inc. (NASDAQ: EBMT), (the “Company,” “Eagle”), the holding company of Opportunity Bank of Montana (the “Bank”), today reported net income of $3.4 million, or $0.44 per diluted share, in the fourth quarter of 2024, compared to $2.7 million, or $0.34 per diluted share, in the preceding quarter, and $2.2 million, or $0.28 per diluted share, in the fourth quarter of 2023. For the year ended December 31, 2024, net income was $9.8 million, or $1.24 per diluted share, compared to $10.1 million, or $1.29 per diluted share, in 2023.

Eagle’s board of directors declared a quarterly cash dividend of $0.1425 per share on January 23, 2025. The dividend will be payable March 7, 2025, to shareholders of record February 14, 2025. The current dividend represents an annualized yield of 3.93% based on recent market prices.

“Eagle’s fourth quarter operating results were highlighted by strong quarterly deposit growth, sound revenue generation, and net interest margin expansion,” said Laura F. Clark, President and CEO. “We continue to maintain a stable core deposit base, with non-CDs representing 72.4% of total deposits at year end. Additionally, we continue to maintain quality credit. While loan growth has moderated in recent quarters, we are anticipating steady single-digit loan growth in the year ahead.”

Fourth Quarter 2024 Highlights (at or for the three-month period ended December 31, 2024, except where noted):

Net income increased 26.7% to $3.4 million, or $0.44 per diluted share, in the fourth quarter of 2024, compared to $2.7 million, or $0.34 per diluted share, in the preceding quarter, and increased 58.6% compared to $2.2 million, or $0.28 per diluted share, in the fourth quarter a year ago.
Net interest margin (“NIM”) was 3.59% in the fourth quarter of 2024, a 25 basis point increase compared to 3.34% in the preceding quarter and a 27 basis point increase compared to the fourth quarter a year ago.
Revenues (net interest income before the provision for credit losses, plus noninterest income) increased 2.8% to $21.4 million in the fourth quarter of 2024, compared to $20.8 million in the preceding quarter and increased 1.7% compared to $21.0 million in the fourth quarter a year ago.
Total loans increased 2.4% to $1.52 billion, at December 31, 2024, compared to $1.48 billion a year earlier, and decreased 0.9% compared to $1.53 billion at September 30, 2024.
Total deposits increased $46.0 million or 2.8% to $1.68 billion at December 31, 2024, compared to a year earlier, and increased $30.7 million or 1.9%, compared to September 30, 2024.
The allowance for credit losses represented 1.11% of portfolio loans and 437.7% of nonperforming loans at December 31, 2024, compared to 1.11% of portfolio loans and 195.2% of nonperforming loans at December 31, 2023.

The Company’s available borrowing capacity was approximately $404.0 million at December 31, 2024, compared to $398.5 million at December 31, 2023.

	December 31, 2024				December 31, 2023
(Dollars in thousands)	Borrowings Outstanding		Remaining Borrowing Capacity			Borrowings Outstanding		Remaining Borrowing Capacity
Federal Home Loan Bank advances	$	140,930	$	276,664		$	175,737	$	266,017
Federal Reserve Bank discount window		–		27,349			–		32,472
Correspondent bank lines of credit		–		100,000			–		100,000
Total	$	140,930	$	404,013		$	175,737	$	398,489

The Company paid a quarterly cash dividend in the fourth quarter of $0.1425 per share on December 6, 2024, to shareholders of record November 15, 2024.

Balance Sheet Results
Eagle’s total assets increased 1.3% to $2.10 billion at December 31, 2024, compared to $2.08 billion a year ago, and decreased 2.0% compared to $2.15 billion three months earlier. The investment securities portfolio totaled $292.6 million at December 31, 2024, compared to $318.3 million a year ago, and $307.0 million at September 30, 2024.

Eagle originated $68.1 million in new residential mortgages during the quarter and sold $64.0 million in residential mortgages, with an average gross margin on sale of mortgage loans of approximately 3.18%. This production compares to residential mortgage originations of $58.0 million in the preceding quarter with sales of $51.0 million and an average gross margin on sale of mortgage loans of approximately 3.31%. Mortgage volumes remain low as rates have continued to be elevated relative to rates on existing mortgages.

Total loans increased $36.2 million, or 2.4%, compared to a year ago, and decreased $14.0 million, or 0.9%, from three months earlier. Commercial real estate loans increased 6.1% to $646.0 million at December 31, 2024, compared to $608.7 million a year earlier. Commercial real estate loans were comprised of 71.4% non-owner occupied and 28.6% owner occupied at December 31, 2024. Agricultural and farmland loans increased 4.9% to $281.0 million at December 31, 2024, compared to $267.9 million a year earlier. Residential mortgage loans decreased 1.8% to $153.7 million, compared to $156.6 million a year earlier. Commercial loans increased 8.5% to $144.0 million, compared to $132.7 million a year ago. Commercial construction and development loans decreased 21.5% to $124.2 million, compared to $158.1 million a year ago. Home equity loans increased 12.2% to $97.5 million, residential construction loans increased 5.2% to $45.7 million, and consumer loans decreased 5.4% to $28.5 million, compared to a year ago.

“Similar to other community banks, our deposit mix has shifted towards higher yielding deposits over the last several quarters due to the higher interest rate environment. However, the recent Fed rate cuts have started to ease deposit pricing, and we anticipate this will continue as we move through this next rate cycle,” said Miranda Spaulding, CFO.

Total deposits increased to $1.68 billion at December 31, 2024, compared to $1.64 billion at December 31, 2023, and $1.65 billion at September 30, 2024. Noninterest-bearing checking accounts represented 24.9%, interest-bearing checking accounts represented 13.2%, savings accounts represented 12.5%, money market accounts comprised 21.8% and time certificates of deposit made up 27.6% of the total deposit portfolio at December 31, 2024. There were no brokered certificates at December 31, 2024, compared to $72.2 million at December 31, 2023, and $22.1 million at September 30, 2024. The average cost of total deposits was 1.71% in the fourth quarter of 2024, compared to 1.76% in the preceding quarter and 1.49% in the fourth quarter of 2023. The estimated amount of uninsured deposits was approximately $323.0 million, or 19% of total deposits, at December 31, 2024, compared to $307.0 million, or 18% of total deposits, at September 30, 2024.

Shareholders’ equity was $174.8 million at December 31, 2024, compared to $169.3 million a year earlier and $177.7 million three months earlier. Book value per share was $21.77 at December 31, 2024, compared to $21.11 a year earlier and $22.17 three months earlier. Tangible book value per share, a non-GAAP financial measure calculated by dividing shareholders’ equity, less goodwill and core deposit intangible, by common shares outstanding, was $16.88 at December 31, 2024, compared to $16.05 a year earlier and $17.23 three months earlier.

Operating Results
“The higher yields on interest earning assets combined with a lower cost of funds contributed to our 25 basis point NIM expansion during the quarter, compared to the preceding quarter,” said Spaulding. “We anticipate additional improvement in our cost of funds over the next several quarters.”

Eagle’s NIM was 3.59% in the fourth quarter of 2024, a 25 basis point increase compared to 3.34% in the preceding quarter and a 27 basis point improvement compared to the fourth quarter a year ago. The interest accretion on acquired loans totaled $161,000 and resulted in a four basis-point increase in the NIM during the fourth quarter of 2024, compared to $167,000 and a three basis-point increase in the NIM during the preceding quarter. Funding costs for the fourth quarter of 2024 were 2.69%, compared to 2.89% in the third quarter of 2024 and 2.58% in the fourth quarter of 2023. Average yields on interest earning assets for the fourth quarter of 2024 increased to 5.70%, compared to 5.66% in the third quarter of 2024 and 5.36% in the fourth quarter a year ago. For the year, the NIM was 3.42% compared to 3.51% for 2023.

Net interest income, before the provision for credit losses, increased 6.3% to $16.8 million in the fourth quarter of 2024, compared to $15.8 million in the third quarter of 2024, and increased 10.5% compared to $15.2 million in the fourth quarter of 2023. For the year, net interest income increased 1.5% to $63.4 million, compared to $62.5 million in 2023.

Fourth quarter revenues increased 2.8% to $21.4 million, compared to $20.8 million in the preceding quarter and increased 1.7% compared to $21.0 million in the fourth quarter a year ago. For the year 2024, revenues were $81.2 million, compared to $85.2 million in 2023. The decrease compared to a year ago was largely due to lower volumes in mortgage banking activity.

Total noninterest income decreased 8.2% to $4.6 million in the fourth quarter of 2024, compared to $5.0 million in the preceding quarter, and decreased 21.3% compared to $5.8 million in the fourth quarter a year ago. The decrease compared to the preceding quarter was largely due to income from bank owned life insurance of $724,000 recorded during the third quarter of 2024. Net mortgage banking income, the largest component of noninterest income, totaled $2.8 million in the fourth quarter of 2024, compared to $2.6 million in the preceding quarter and $3.7 million in the fourth quarter a year ago. This decrease compared to the fourth quarter a year ago was largely driven by a decline in net gain on sale of mortgage loans, which was impacted by lower mortgage loan volumes. For the year, noninterest income decreased 21.8% to $17.8 million, compared to $22.7 million in 2023. Net mortgage banking income decreased 33.1% to $10.0 million in 2024, compared to $15.0 million in 2023. These decreases were driven by a decline in net gain on sale of mortgage loans.

Eagle’s fourth quarter noninterest expense was $17.7 million, an increase of 2.5% compared to $17.3 million in the preceding quarter and a 6.3% decrease compared to $18.9 million in the fourth quarter a year ago. Lower salaries and employee benefits contributed to the decrease compared to the year ago quarter. For the year, noninterest expense decreased 3.9% to $69.3 million, compared to $72.1 million in 2023.

For the fourth quarter of 2024, the Company recorded income tax expense of $269,000. This compared to income tax expense of $529,000 in the preceding quarter and an income tax benefit of $315,000 in the fourth quarter of 2023. The effective tax rate for the year was 14.2% compared to 13.7% for the prior year and is due to the increase in proportion of tax-exempt income compared to pretax earnings, as well as tax credits from investments in low-income housing tax credit projects.

Credit Quality
Due to muted loan growth and positive economic factors within the CECL modeling, Eagle recorded a recapture in its provision for credit losses of $36,000 during the fourth quarter of 2024. This compared to a $277,000 provision for credit losses in the preceding quarter and $270,000 in the fourth quarter a year ago. The allowance for credit losses represented 437.7% of nonperforming loans at December 31, 2024, compared to 356.7% three months earlier and 195.2% a year earlier. Nonperforming loans were $3.9 million at December 31, 2024, $4.8 million at September 30, 2024, and $8.4 million a year earlier. Net loan charge-offs totaled $44,000 in the fourth quarter of 2024, compared to net loan charge-offs of $17,000 in the preceding quarter and net loan charge-offs of $10,000 in the fourth quarter a year ago. The allowance for credit losses was $16.9 million, or 1.11% of total loans, at December 31, 2024, compared to $17.1 million, or 1.12% of total loans, at September 30, 2024, and $16.4 million, or 1.11% of total loans, a year ago.

Capital Management
The ratio of tangible common shareholders’ equity (shareholders’ equity, less goodwill and core deposit intangible) to tangible assets (total assets, less goodwill and core deposit intangible) was 6.57% at December 31, 2024, up from 6.32% a year ago and 6.56% three months earlier. This ratio is a non-GAAP financial measure. For the most comparable GAAP financial measure, see “Reconciliation of Non-GAAP Financial Measures” below. As of December 31, 2024, the Bank’s regulatory capital was in excess of all applicable regulatory requirements and is deemed well capitalized. The Bank’s Tier 1 capital to adjusted total average assets was 10.07% as of December 31, 2024.

About the Company
Eagle Bancorp Montana, Inc. is a bank holding company headquartered in Helena, Montana, and is the holding company of Opportunity Bank of Montana, a community bank established in 1922 that serves consumers and small businesses in Montana through 29 banking offices. Additional information is available on the Bank’s website at www.opportunitybank.com. The shares of Eagle Bancorp Montana, Inc. are traded on the NASDAQ Global Market under the symbol “EBMT.”

Forward Looking Statements
This release may contain certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and may be identified by the use of such words as “believe,” “will” “expect,” “anticipate,” “should,” “planned,” “estimated,” and “potential.” These forward-looking statements include, but are not limited to statements of our goals, intentions, expectations and anticipations; statements regarding our business plans, prospects, mergers, growth and operating strategies; statements regarding the asset quality of our loan and investment portfolios; and estimates of our risks and future costs and benefits. These forward-looking statements are based on current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. These factors include, but are not limited to, changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements; general economic conditions and political events, either nationally or in our market areas, that are worse than expected; the emergence or continuation of widespread health emergencies or pandemics, including but not limited to vaccine efficacy and immunization rates, new variants, steps taken by governmental and other authorities to contain, mitigate and combat the pandemic, adverse effects on our employees, customers and third-party service providers, the increase in cyberattacks in the current work-from-home environment; the impact of volatility in the U.S. banking industry, including the associated impact of any regulatory changes or other mitigation efforts taken by governmental agencies in response thereto; the impact of any new regulatory, policy or enforcement developments resulting from the change in U.S. presidential administration; the possibility that future credit losses may be higher than currently expected due to changes in economic assumptions, customer behavior, adverse developments with respect to U.S. economic conditions and other uncertainties, including the impact of supply chain disruptions, inflationary pressures and labor shortages on economic conditions and our business; an inability to access capital markets or maintain deposits or borrowing costs; competition among banks, financial holding companies and other traditional and non-traditional financial service providers; loan demand or residential and commercial real estate values in Montana; the concentration of our business in Montana; our ability to continue to increase and manage our commercial real estate, commercial business and agricultural loans; the costs and effects of legal, compliance and regulatory actions, changes and developments, including the initiation and resolution of legal proceedings (including any securities, bank operations, consumer or employee litigation); inflation and changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments; adverse changes in the securities markets that lead to impairment in the value of our investment securities and goodwill; other economic, governmental, competitive, regulatory and technological factors that may affect our operations; our ability to implement new technologies and maintain secure and reliable technology systems including those that involve the Bank’s third-party vendors and service providers; cyber incidents, or theft or loss of Company or customer data or money; our ability to appropriately address social, environmental, and sustainability concerns that may arise from our business activities; the effect of our recent or future acquisitions, including the failure to achieve expected revenue growth and/or expense savings, the failure to effectively integrate their operations, the outcome of any legal proceedings and the diversion of management time on issues related to the integration.

Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements. All information set forth in this press release is current as of the date of this release and the company undertakes no duty or obligation to update this information.

Use of Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles utilized in the United States, or GAAP, in this release, including the Financial Ratios and Other Data contains non-GAAP financial measures. Non-GAAP financial measures include: 1) core efficiency ratio, 2) tangible book value per share and 3) tangible common equity to tangible assets. The Company uses these non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance, performance trends and financial condition, and to enhance investors’ overall understanding of such financial performance. In particular, the use of tangible book value per share and tangible common equity to tangible assets is prevalent among banking regulators, investors and analysts.

The numerator for the core efficiency ratio is calculated by subtracting acquisition costs and intangible asset amortization from noninterest expense. Tangible assets and tangible common shareholders’ equity are calculated by excluding intangible assets from assets and shareholders’ equity, respectively. For these financial measures, our intangible assets consist of goodwill and core deposit intangible. Tangible book value per share is calculated by dividing tangible common shareholders’ equity by the number of common shares outstanding. We believe that this measure is consistent with the capital treatment by our bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios and present this measure to facilitate the comparison of the quality and composition of our capital over time and in comparison, to our competitors.

Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names. Further, the non-GAAP financial measure of tangible book value per share should not be considered in isolation or as a substitute for book value per share or total shareholders’ equity determined in accordance with GAAP, and may not be comparable to a similarly titled measure reported by other companies. Eagle strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Reconciliation of the GAAP and non-GAAP financial measures are presented below.

Balance Sheet
(Dollars in thousands, except per share data)				(Unaudited)
	December 31,			September 30,			December 31,
	2024			2024			2023

Assets:
Cash and due from banks	$	29,824		$	22,954		$	23,243
Interest bearing deposits in banks		1,735			19,035			1,302
Federal funds sold		–			200			–
Total cash and cash equivalents		31,559			42,189			24,545
Securities available-for-sale, at fair value		292,590			306,982			318,279
Federal Home Loan Bank (“FHLB”) stock		7,778			11,218			9,191
Federal Reserve Bank (“FRB”) stock		4,131			4,131			4,131
Mortgage loans held-for-sale, at fair value		13,368			13,429			11,432
Loans:
Real estate loans:
Residential 1-4 family		153,721			156,811			156,578
Residential 1-4 family construction		45,701			52,217			43,434
Commercial real estate		645,962			644,019			608,691
Commercial construction and development		124,211			125,323			158,132
Farmland		146,610			145,356			142,590
Other loans:
Home equity		97,543			93,646			86,932
Consumer		28,513			29,445			30,125
Commercial		144,039			143,190			132,709
Agricultural		134,346			144,645			125,298
Total loans		1,520,646			1,534,652			1,484,489
Allowance for credit losses		(16,850	)		(17,130	)		(16,440	)
Net loans		1,503,796			1,517,522			1,468,049
Accrued interest and dividends receivable		12,890			14,844			12,485
Mortgage servicing rights, net		15,376			15,443			15,853
Assets held-for-sale, at cost		960			257			–
Premises and equipment, net		101,540			100,297			94,282
Cash surrender value of life insurance, net		53,232			52,852			47,939
Goodwill		34,740			34,740			34,740
Core deposit intangible, net		4,499			4,834			5,880
Other assets		26,631			26,375			28,860
Total assets	$	2,103,090		$	2,145,113		$	2,075,666

Liabilities:
Deposit accounts:
Noninterest bearing	$	419,211		$	419,760		$	418,727
Interest bearing		1,262,017			1,230,752			1,216,468
Total deposits		1,681,228			1,650,512			1,635,195
Accrued expenses and other liabilities		47,018			38,593			36,462
FHLB advances and other borrowings		140,930			219,167			175,737
Other long-term debt, net		59,149			59,111			58,999
Total liabilities		1,928,325			1,967,383			1,906,393

Shareholders’ Equity:
Preferred stock (par value $0.01 per share; 1,000,000 shares
authorized; no shares issued or outstanding)		–			–			–
Common stock (par value $0.01; 20,000,000 shares authorized;
8,507,429 shares issued; 8,027,177, 8,016,784 and 8,016,784
shares outstanding at December 31, 2024, September 30, 2024, and
December 31, 2023, respectively		85			85			85
Additional paid-in capital		108,334			109,040			108,819
Unallocated common stock held by Employee Stock Ownership Plan		(4,011	)		(4,154	)		(4,583	)
Treasury stock, at cost (480,252, 490,645 and 490,645 shares at
December 31, 2024, September 30, 2024, and December 31, 2023, respectively)		(10,761	)		(11,124	)		(11,124	)
Retained earnings		101,264			98,979			96,021
Accumulated other comprehensive loss, net of tax		(20,146	)		(15,096	)		(19,945	)
Total shareholders’ equity		174,765			177,730			169,273
Total liabilities and shareholders’ equity	$	2,103,090		$	2,145,113		$	2,075,666

Income Statement				(Unaudited)						(Unaudited)
(Dollars in thousands, except per share data)	Three Months Ended									Years Ended
	December 31,			September 30,		December 31,				December 31,
	2024			2024		2023				2024			2023
Interest and dividend income:
Interest and fees on loans	$	23,756		$	23,802		$	21,481		$	92,282		$	79,423
Securities available-for-sale		2,475			2,598			2,790			10,428			11,376
FRB and FHLB dividends		308			266			247			1,085			727
Other interest income		148			94			23			416			89
Total interest and dividend income		26,687			26,760			24,541			104,211			91,615
Interest expense:
Interest expense on deposits		7,216			7,190			6,090			27,838			17,857
FHLB advances and other borrowings		2,005			3,084			2,569			10,211			8,562
Other long-term debt		676			684			684			2,724			2,719
Total interest expense		9,897			10,958			9,343			40,773			29,138
Net interest income		16,790			15,802			15,198			63,438			62,477
(Recapture) provision for credit losses		(36	)		277			270			518			1,456
Net interest income after provision for credit losses		16,826			15,525			14,928			62,920			61,021

Noninterest income:
Service charges on deposit accounts		387			430			444			1,645			1,757
Mortgage banking, net		2,818			2,602			3,718			10,014			14,970
Interchange and ATM fees		675			662			663			2,540			2,524
Appreciation in cash surrender value of life insurance		408			1,038			301			2,054			1,466
Net loss on sale of available-for-sale securities		(141	)		–			–			(141	)		(222	)
Other noninterest income		425			251			686			1,664			2,227
Total noninterest income		4,572			4,983			5,812			17,776			22,722

Noninterest expense:
Salaries and employee benefits		9,830			9,894			11,359			39,715			42,973
Occupancy and equipment expense		2,194			2,134			1,972			8,531			8,072
Data processing		1,715			1,587			1,673			6,209			5,943
Software subscriptions		576			511			519			2,127			2,064
Advertising		466			277			445			1,312			1,375
Amortization		337			337			386			1,391			1,587
Loan costs		372			385			461			1,567			1,887
FDIC insurance premiums		287			295			288			1,165			1,150
Professional and examination fees		596			438			438			1,941			1,922
Other noninterest expense		1,323			1,412			1,350			5,348			5,116
Total noninterest expense		17,696			17,270			18,891			69,306			72,089

Income before provision for income taxes		3,702			3,238			1,849			11,390			11,654
Provision (benefit) for income taxes		269			529			(315	)		1,612			1,598
Net income	$	3,433		$	2,709		$	2,164		$	9,778		$	10,056

Basic earnings per common share	$	0.44		$	0.35		$	0.28		$	1.25		$	1.29
Diluted earnings per common share	$	0.44		$	0.34		$	0.28		$	1.24		$	1.29

Basic weighted average shares outstanding		7,862,279			7,836,921			7,809,274			7,838,822			7,793,352

Diluted weighted average shares outstanding		7,868,507			7,860,138			7,815,022			7,853,792			7,798,244

ADDITIONAL FINANCIAL INFORMATION				(Unaudited)
(Dollars in thousands, except per share data)	Three Months Ended or Years Ended
	December 31,			September 30,		December 31,
	2024			2024		2023

Mortgage Banking Activity (For the quarter):
Net gain on sale of mortgage loans	$	2,036		$	1,691	$	2,845
Net change in fair value of loans held-for-sale and derivatives		(3	)		159		(40	)
Mortgage servicing income, net		785			752		913
Mortgage banking, net	$	2,818		$	2,602	$	3,718

Mortgage Banking Activity (Year-to-date):
Net gain on sale of mortgage loans	$	6,741				$	11,396
Net change in fair value of loans held-for-sale and derivatives		(5	)				194
Mortgage servicing income, net		3,278					3,380
Mortgage banking, net	$	10,014				$	14,970

Performance Ratios (For the quarter):
Return on average assets		0.65%			0.51%		0.42%
Return on average equity		8.12%			6.56%		5.68%
Yield on average interest earning assets		5.70%			5.66%		5.36%
Cost of funds		2.69%			2.89%		2.58%
Net interest margin		3.59%			3.34%		3.32%
Core efficiency ratio*		81.26%			81.47%		88.08%

Performance Ratios (Year-to-date):
Return on average assets		0.47%					0.50%
Return on average equity		5.94%					6.33%
Yield on average interest earning assets		5.62%					5.14%
Cost of funds		2.76%					2.11%
Net interest margin		3.42%					3.51%
Core efficiency ratio*		83.62%					82.75%

* The core efficiency ratio is a non-GAAP ratio that is calculated by dividing non-interest expense, exclusive of acquisition
costs and intangible asset amortization, by the sum of net interest income and non-interest income.



ADDITIONAL FINANCIAL INFORMATION
(Dollars in thousands, except per share data)

Asset Quality Ratios and Data:	As of or for the Three Months Ended
	December 31,			September 30,		December 31,
	2024			2024		2023

Nonaccrual loans	$	3,227		$	3,859	$	8,395
Loans 90 days past due and still accruing		623			944		26
Total nonperforming loans		3,850			4,803		8,421
Other real estate owned and other repossessed assets		45			4		5
Total nonperforming assets	$	3,895		$	4,807	$	8,426

Nonperforming loans / portfolio loans		0.25%			0.31%		0.57%
Nonperforming assets / assets		0.19%			0.22%		0.41%
Allowance for credit losses / portfolio loans		1.11%			1.12%		1.11%
Allowance for credit losses/ nonperforming loans		437.66%			356.65%		195.23%
Gross loan charge-offs for the quarter	$	51		$	22	$	11
Gross loan recoveries for the quarter	$	7		$	5	$	1
Net loan charge-offs for the quarter	$	44		$	17	$	10


	December 31,			September 30,		December 31,
	2024			2024		2023
Capital Data (At quarter end):
Common shareholders’ equity (book value) per share	$	21.77		$	22.17	$	21.11
Tangible book value per share**	$	16.88		$	17.23	$	16.05
Shares outstanding		8,027,177			8,016,784		8,016,784
Tangible common equity to tangible assets***		6.57%			6.56%		6.32%

Other Information:
Average investment securities for the quarter	$	300,088		$	305,730	$	306,678
Average investment securities year-to-date	$	306,538		$	308,688	$	328,533
Average loans for the quarter ****	$	1,533,686		$	1,547,246	$	1,494,181
Average loans year-to-date ****	$	1,523,384		$	1,519,951	$	1,436,672
Average earning assets for the quarter	$	1,858,078		$	1,874,669	$	1,817,419
Average earning assets year-to-date	$	1,850,120		$	1,847,468	$	1,780,727
Average total assets for the quarter	$	2,107,357		$	2,116,839	$	2,062,267
Average total assets year-to-date	$	2,092,051		$	2,086,951	$	2,015,586
Average deposits for the quarter	$	1,671,653		$	1,622,254	$	1,626,598
Average deposits year-to-date	$	1,636,390		$	1,624,636	$	1,603,861
Average equity for the quarter	$	169,054		$	165,162	$	152,516
Average equity year-to-date	$	164,591		$	163,106	$	158,807



** The tangible book value per share is a non-GAAP ratio that is calculated by dividing shareholders’ equity,
less goodwill and core deposit intangible, by common shares outstanding.
*** The tangible common equity to tangible assets is a non-GAAP ratio that is calculated by dividing shareholders’
equity, less goodwill and core deposit intangible, by total assets, less goodwill and core deposit intangible.
**** Includes loans held for sale

Reconciliation of Non-GAAP Financial Measures

Core Efficiency Ratio				(Unaudited)						(Unaudited)
(Dollars in thousands)	Three Months Ended									Years Ended
	December 31,			September 30,			December 31,			December 31,
	2024			2024			2023			2024			2023
Calculation of Core Efficiency Ratio:
Noninterest expense	$	17,696		$	17,270		$	18,891		$	69,306		$	72,089
Intangible asset amortization		(337	)		(337	)		(386	)		(1,391	)		(1,587	)
Core efficiency ratio numerator		17,359			16,933			18,505			67,915			70,502

Net interest income		16,790			15,802			15,198			63,438			62,477
Noninterest income		4,572			4,983			5,812			17,776			22,722
Core efficiency ratio denominator		21,362			20,785			21,010			81,214			85,199

Core efficiency ratio (non-GAAP)		81.26%			81.47%			88.08%			83.62%			82.75%

Tangible Book Value and Tangible Assets	(Unaudited)
(Dollars in thousands, except per share data)	December 31,			September 30,			December 31,
	2024			2024			2023
Tangible Book Value:
Shareholders’ equity	$	174,765		$	177,730		$	169,273
Goodwill and core deposit intangible, net		(39,239	)		(39,574	)	$	(40,620	)
Tangible common shareholders’ equity (non-GAAP)	$	135,526		$	138,156		$	128,653

Common shares outstanding at end of period		8,027,177			8,016,784			8,016,784

Common shareholders’ equity (book value) per share (GAAP)	$	21.77		$	22.17		$	21.11

Tangible common shareholders’ equity (tangible book value)
per share (non-GAAP)	$	16.88		$	17.23		$	16.05

Tangible Assets:
Total assets	$	2,103,090		$	2,145,113		$	2,075,666
Goodwill and core deposit intangible, net		(39,239	)		(39,574	)		(40,620	)
Tangible assets (non-GAAP)	$	2,063,851		$	2,105,539		$	2,035,046

Tangible common shareholders’ equity to tangible assets
(non-GAAP)		6.57%			6.56%			6.32%

Contacts:	Laura F. Clark, President and CEO (406) 457-4007 Miranda J. Spaulding, SVP and CFO (406) 441-5010

The MIL Network –

January 29, 2025

MIL-OSI USA: Warren Writes Fox News Digital Op-ed Challenging Elon Musk to Cut $2 Trillion in Waste By Taking On Billionaires and Giant Corporations

US Senate News:

Source: United States Senator for Massachusetts – Elizabeth Warren
January 28, 2025
“Here’s something President Donald Trump, Elon Musk, and I agree on: the federal government throws away trillions of dollars on wasteful spending.”
“Instead of cutting help for people who rely on Medicare, Social Security and the VA, let’s focus on the billionaires and billionaire corporations who are feasting off the American taxpayer.”
Warren Op-Ed in Fox News Digital
Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs, published an op-ed outlining her recommendations for cutting government waste to make government more efficient and save taxpayers money. In a public letter last week, Warren proposed 30 recommendations for President Trump and Elon Musk, head of the Department of Government Efficiency, to cut at least $2 trillion in government waste over the next decade.
Musk has already walked back his goal of $2 trillion of cuts. Unlike the Republican plans, none of these recommendations would cut access to Medicare, Medicaid, Social Security, veterans’ benefits, and other programs that tens of millions of Americans count on–and instead focus on waste, fraud, and abuse in government spending.
Read the full op-ed here and below:
Senator Elizabeth Warren: Trump, Musk and I agree on something important. And I’ve got 30 ways to get it doneJanuary 28, 2025
Here’s something President Donald Trump, Elon Musk, and I agree on: the federal government throws away trillions of dollars on wasteful spending. I have spent years trying to squeeze government waste out of our budget, and I’m ready to work with Musk to make government more efficient and save taxpayers money. But here’s the thing: we need to focus in the right place. Instead of cutting help for people who rely on Medicare, Social Security and the VA, let’s focus on the billionaires and billionaire corporations who are feasting off the American taxpayer.
After promising his Department of Government Efficiency (DOGE) would cut $2 trillion in government waste, Musk’s ambition is rapidly shrinking. Within weeks, he cut his goal in half to $1 trillion– all before he’s actually cut a single dollar. I don’t want Musk to fold so quickly. I crunched the numbers and found $2 trillion that we could cut over the next 10 years by focusing on the guys who are getting rich off our government. Last week, I sent Musk my blueprint to do just that.
Congressional Republicans’ initial plans call for cuts to government programs that millions of Americans rely on to pay their bills each month – things like Social Security, money to cover nursing home costs, and help buying private health insurance. Scrapping essential services is not efficiency; it is cold-hearted cruelty. Tossing old folks out of nursing homes or telling people that their insurance has been cancelled won’t save money; it just makes lives tougher for the families that struggle to pick up the slack. If Musk and the Republicans take that route, it will be a disaster for working people and I will fight back.
But we don’t have to cut the programs Americans rely on. We can eliminate at least $2 trillion of government waste over the next decade without cutting programs that help our grandparents, our veterans, and our children. In fact, I have 30 specific proposals to do just that. I’ll share a few of them now, but you can read all about them in my letter to Musk here.
Here are a few examples of government waste we could start with. First, we could negotiate better contracts for the Department of Defense. In 2023, the DoD spent $440.7 billion on contracts – and giant contractors overcharge us on nearly everything. The Air Force pays over 7,500% more on soap dispensers than regular Americans do. The Army pays $71 for pins that should cost less than a nickel. Spending is so out of control at DoD that it is the only agency in government that cannot pass a simple audit. American taxpayers are sick of getting scammed by overpaid military contractors. My recommendations on Defense spending alone would save nearly $200 billion in the next 12 years.
Taxpayers are also getting swindled by for-profit health insurance companies. Right now, about half of all seniors have been lured into a privatized Medicare program called Medicare Advantage. This program was started to lower costs for seniors, but over time the insurers figured out how to boost their profits by manipulating claims and denying coverage. It’s so bad now that the non-partisan Medicare Payment Advisory Commission estimates that privatized Medicare insurers overcharged taxpayers by nearly $83 billion in 2024 alone, while other independent researchers put the dollar figure at $140 billion. Rooting out their dirty tactics could save more than a trillion dollars over ten years without cutting Medicare benefits by one penny.
Cracking down on health care profiteering isn’t a partisan issue. I’ve partnered with Republican Josh Hawley of Missouri to claw back billions more from corporations that are cheating the government on health care costs. He’s not the only Republican who agrees that we need to stop corporations from overcharging taxpayers for lifesaving medications: President Trump has voiced support for another one of my proposals to cut wasteful spending, Medicare price negotiations. By expanding this program to bring the prices down for the most expensive drugs covered by Medicare, the government could save taxpayers another $200 billion over the next decade.
We can bring down the deficit by cutting spending, but we can also improve our financial position by making millionaires and billionaires pay their fair share. Hedge funds and private equity companies use loopholes to avoid paying anywhere between $1.4 billion and $18 billion each year – that’s an easy fix. By closing just one big estate tax exemption loophole abused by the ultra-rich, the US government could save another $60 billion per year. We should close those loopholes – and fully fund the IRS to catch wealthy tax cheats who think they’re above the law.
My list of cuts and loophole closers will save $2 trillion. So where are Elon Musk, Donald Trump and the DOGE project? Why give up so quickly on beating back the defense contractors, health insurance giants, and other huge companies that are ripping off the American people? If Musk and Trump have the courage to cut this waste, I’ve got a plan and 30 specific recommendations to get it done.
Democrat Elizabeth Warren represents Massachusetts in the United States Senate.

MIL OSI USA News –

January 29, 2025

MIL-OSI United Kingdom: Middle East: Minister for Development’s statement, 28 January 2025

Source: United Kingdom – Executive Government & Departments

Development Minister Anneliese Dodds gave an oral statement to the House of Commons on the ceasefire agreement in Gaza and effect on humanitarian aid.

With permission, I will update the House on the ceasefire agreement in Gaza and detail our latest efforts to get aid to those in desperate need.

Madam Deputy Speaker, this is a fragile ceasefire – but it brings much-needed hope for the Israeli and Palestinian people.

The agreement to end the fighting and release the hostages is what this Labour government has been pressing for from the moment we came to office.

I thank Qatar, Egypt and the US for their tireless efforts, and echo the Prime Minister in wishing Emily Damari and the other former hostages well as they begin to recover from their horrific ordeals.

We continue to call, Madam Deputy Speaker, for their immediate release of all those still waiting to be reunited with their loved ones, including the remaining hostages with links to the UK.

Madam Deputy Speaker, civilians in Gaza have endured suffering that defies belief, and this deal brings hope that they can start to rebuild their lives.

In the days since the guns were silenced, Israel has opened up mechanisms to surge in aid.

The UN and aid organisations have been working tirelessly to deliver the humanitarian aims of the ceasefire agreement.

After so much time waiting at the border – delays I saw for myself in December – trucks are now streaming in.

Partners on the ground report that more than 200,000 food parcels have been dispatched to more than 130 distribution points since the ceasefire.

This government has been at the forefront of the humanitarian effort in Gaza since we came to office.

Overturning the suspension of funding to UNRWA and then boosting our support. Supporting UK-Med field hospitals to help the injured. Working with Egypt to support those Medevac-ed out of Gaza and providing vital resources to UNICEF and the World Food Programme.

Today, I am pleased to announce that the UK is investing in the ceasefire.

UK support will be distributed to the UN and key medical partners, so that tens of thousands of civilians get the healthcare, food and shelter they need.

That support will amount to £17 million from the UK to get more aid into Gaza and restore services. The figure also includes £2 million for the World Bank to support the construction and restoration of critical water and energy infrastructure.

The UK has already helped around 284,000 people in Gaza to access water, sanitation and hygiene services.

Today’s uplift brings our commitment for the Occupied Palestinian Territories and Palestinian refugees in the region to £129 million this financial year.

I am also pleased to announce to the House that this morning, Jordanian air force helicopters started landing in Gaza with UK-funded medical supplies and logistical support from UK armed forces.

I thank Jordan for their excellent commitment to getting aid in, in such challenging circumstances. We will continue to support our Jordanian partners in this initiative.

But more action is needed.

The air bridge to Gaza is no substitute for road routes, which must remain open.

We also call on Israel to allow more essential items like tents, mattresses and medical equipment in.

As people start to move home, basic services need to be put back in place, and unexploded bombs and mines cleared.

Without this, even more lives will be lost.

And of course, the UN and humanitarian agencies must be able to operate freely.

This Government has repeatedly stated the need for UNRWA to continue its lifesaving assistance to the people of Gaza, Jerusalem and the West Bank.

The Knesset legislation taking effect on the 30th of January risks impeding the progress made since the ceasefire. Israel must allow the agency to continue to operate.

The legislation does not and cannot change the fact that Israel has a responsibility under international law to facilitate humanitarian assistance.

As the UN Security Council heard last week, a million Gazan children need support to process their traumatic experiences – their suffering cannot be underestimated.

And around fifteen and a half thousand patients need medical evacuation, according to the World Health Organisation. Routes must be opened for them to get this treatment.

Madam Deputy Speaker, the UK and wider international community stand ready to support Palestinians as they begin to rebuild their lives, their homes and their communities.

We are under no illusions concerning the scale of the challenge ahead.

The overwhelming majority of homes in Gaza are damaged or destroyed. The economy has collapsed. And basic services, including energy and water, have been knocked out.

So, we are working with partners to urgently find ways to

best finance and support recovery and reconstruction efforts.

It is essential that the coming surge of assistance is properly coordinated, and with the access and security to reach those in need.

The Palestinian Authority has a crucial role to play and we are providing technical and financial assistance to the Authority, including to support the urgent recovery of basic services.

Madam Deputy Speaker, the UK has always been clear that this ceasefire is just the first step. We must build confidence on all sides to help sustain it, progress through all its phases and turn it into a lasting peace that assures the security of Israelis and Palestinians alike.

The UK will focus all of our efforts on keeping up the momentum, using every diplomatic channel available.

As you will know, Madam Deputy Speaker, the Foreign Secretary and the Minister for the Middle East kept up the drumbeat of engagement during their visits to Egypt and the United Nations last week.

We will keep up the pace until every hostage is released, aid reaches all those in need, and Palestinians are able to rebuild their homes and their lives.

I commend this statement to the House.

Published 28 January 2025

MIL OSI United Kingdom –

January 29, 2025

MIL-OSI Africa: International Islamic Trade Finance Corporation (ITFC) Launches New Environmental and Social Policy to Drive Sustainable Trade

Source: Africa Press Organisation – English (2) – Report:

JEDDAH, Saudi Arabia, January 28, 2025/APO Group/ —

The International Islamic Trade Finance Corporation (ITFC) (www.ITFC-IDB.org), member of the Islamic Development Bank Group (IsDB), unveiled its new Environmental and Social (ES) policy. This policy reinforces ITFC’s commitment to embedding sustainable practices across its trade finance operations, recognizing the essential role trade finance and trade development can play in mitigating climate change and promoting social equity.

ITFC’s member countries are among the most vulnerable to climate change, social challenges, and economic inequality. This ongoing climate crisis requires urgent action. With trade being responsible for 20-30% of global CO₂ emissions, ITFC is aligning its operations with international frameworks such as the Paris Agreement and the United Nations Sustainable Development Goals (SDGs) to make trading greener in its markets of operations. By championing responsible and inclusive trade finance, ITFC aims to reduce its carbon footprint while supporting its member countries in achieving sustainable economic growth.

This new ES policy is focused on 5 key areas:

Environmental Action. ITFC is proactively incorporating green practices throughout every aspect of its operations and work environment. By prioritizing digitization, implementing paperless solutions, and enhancing energy efficiency, we aim to lead by example in embracing environmentally responsible initiatives and demonstrating our commitment to sustainability.

Sustainable and Inclusive Trade Finance. ITFC aims to increase its share of financing in goods and services that promote sustainability. By prioritizing sectors that strengthen resilience, such as sustainable agriculture, financial inclusion, and eco-friendly supply chains, ITFC is contributing to sustainable and inclusive growth in our member countries.
Empowering for Sustainable Impact. Through capacity-building programs and technical assistance, ITFC will help businesses and governments reduce climate risks, advance social inclusion, and access green financing opportunities.
Innovative Treasury Solutions. ITFC is dedicated to increasing investment in Shariah-compliant sustainable financial instruments, including exploring the issuance of green Sukuk to bolster climate-resilient trade and development for ITFC member countries.
Credible Assessment and Disclosure. ITFC is committed to adopting best practices to embed environmental and social considerations in its transactions and projects. We aim to transparently disclose our ES performance, adhering to international best practices, promote accountability and build trust with our stakeholders.

On this note, Eng. Hani Salem Sonbol, CEO ITFC stated: “Our work in some of the world’s most climate-vulnerable regions have given us firsthand insight into the reality of climate change. From rural landscapes to urban centers, we are witnessing the effects of an accelerating environmental shift and as we remain true to our commitment to powering sustainable growth, it has become imperative for the Corporation to fully streamline and operationalize its new direction towards sustainability and climate change.”

ITFC’s new environmental and social policy reflects its vision to foster economic growth that is both inclusive and sustainable, setting a new standard for trade finance institutions globally. ITFC remains committed to fostering intra-OIC trade, enhancing member countries’ capacities to adopt green energy solutions.

MIL OSI Africa –

January 29, 2025

MIL-OSI United Kingdom: New humanitarian support for Gaza as ceasefire allows operations to scale up

Source: United Kingdom – Government Statements

The Minister for Development announces new £17 million package to support thousands of civilians across the Occupied Palestinian Territories.

UK aid package will ensure healthcare, food and shelter reaches tens of thousands of civilians and supports vital infrastructure across the Occupied Palestinian Territories.
Minister for Development, Anneliese Dodds announces £17 million package and reiterates need for much more aid to enter Gaza with the support of UN agencies including UNRWA.
Comes as 300,000 people now confirmed treated by UK-Med at field hospitals in Gaza thanks to UK funding.

Thousands of civilians in Gaza will receive humanitarian aid funded by the UK.

Food assistance programmes, water and sanitation services and maternal and children’s healthcare are some of the areas which will be scaled up with new funding.

This will build on UK efforts over the past 15 months which have ensured more than half a million people have received essential healthcare in Gaza.

Within this £17 million package announced today, £2 million in funding for the World Bank will support critical water and energy infrastructure construction and restoration across the Occupied Palestinian Territories (OPTs), including in Gaza. The UK’s ongoing support has meant 284,000 people in Gaza already have improved access to water, sanitation and hygiene services.

This announcement brings the total UK support for the OPTs this financial year to £129 million, demonstrating the UK’s commitment to playing a leading role in alleviating Palestinian suffering and helping to build security and economic recovery in the Middle East. This will help drive UK security, in support of the Government’s Plan for Change.

It comes as a Jordanian-led helicopter initiative flying aid directly to Gaza has started delivering lifesaving UK-funded medicines to civilians today. As well as providing up to £500,000 of supplies onboard, the UK has also deployed military planners to assist with logistics. Speaking in the House this afternoon, Minister Dodds will underscore the UK’s pride in working with Jordan – who have demonstrated leadership and commitment to deliver aid via all routes possible – to get the airbridge up and running in such challenging circumstances.

Minister for Development Anneliese Dodds said:

The scale of suffering in Gaza cannot be overstated and the UN and its agencies, including UNRWA, must be allowed by Israel to do their vital work.

This announcement is part of the UK’s investment in the ceasefire deal, scaling up aid operations and helping the most desperate people access healthcare, water, food and shelter.

We must seize this opportunity to get a surge of humanitarian aid to Gaza, all the hostages released and a path towards a viable Palestinian state.

Minister Dodds emphasised the UK will also continue to support the crucial role played by UN agencies and NGOs operating in Gaza. This includes UNRWA, which has played a vital role in the increase in humanitarian assistance since the ceasefire earlier this month.

Ahead of the upcoming implementation of Israel’s UNRWA legislation on 30 January, which risks jeopardising the humanitarian response in Gaza and the delivery of essential services in East Jerusalem and the West Bank, the UK has urged Israel to ensure that UNRWA can continue its lifesaving operations for Palestinian refugees. Israel has a responsibility under international law to facilitate humanitarian assistance. Minister Dodds will again reiterate that humanitarian operations must not face a cliff edge on 30 January.

The Minister for Development also confirmed that the UK provided an additional £4.5 million to UK-Med last year. The charity deploys staff, many of whom work in the NHS, to crisis-hit areas around the world to deliver life and limb-saving healthcare. NHS staff who work for UK-Med typically deploy to Gaza for a four-week period, supporting lifesaving efforts and gaining essential trauma experience.

UK funding has helped doctors in Gaza treat more than 300,000 patients in Gaza with a range of medical conditions as well as treating injuries directly associated with the conflict. This funding is on top of the £5.5 million announced for the charity on the Foreign Secretary’s first visit to Israel and the OPTs in July last year.

UK-Med CEO, David Wightwick said:

After more than two decades in humanitarian work, I have never seen a crisis of this scale and severity.

That’s why UK Government funding is vital in providing support to UK-Med to deliver life-saving care to over 300,000 patients in Gaza during 2024.

I want to thank our 400-strong team on the ground for their determination, professionalism and tireless work to address the health impacts of this devastating conflict.

This government’s steadfast support for UNRWA, including £41m of support this financial year, has helped the organisation deliver its humanitarian operation and provide essential services such as education, social care and vaccinations across the OPTs and to Palestinian refugees in the region.

Notes to editors

The £17 million package announced today consists of:
£15 million of UK funding comes from the Crisis Reserve pool to be allocated to partner agencies.
£2 million of funding for the World Bank to deliver water and energy infrastructure across the OPTs, including in Gaza
An additional £4.5 million of funding to UK-Med has previously been allocated and spent but not announced
UK-Med operate two field hospitals in Gaza, Deir Al Balah and Al Mawasi. The Al Mawasi field hospital has, among other facilities, an operating theatre, a maternity unit and physical rehabilitation services for patients. At Deir Al Balah, UK-Med staff deliver primary care and see over 400 patients a day. *This air bridge to Gaza is no substitute for the road routes. The terms of the ceasefire must be adhered to, so that many more trucks can safely and effectively distribute aid within Gaza.
Footage – b-roll of UK aid to Gaza via Jordanian helicopters and UK-Med field hospital

Media enquiries

Email newsdesk@fcdo.gov.uk

Telephone 020 7008 3100

Contact the FCDO Communication Team via email (monitored 24 hours a day) in the first instance, and we will respond as soon as possible.

Published 28 January 2025

MIL OSI United Kingdom –

January 29, 2025

MIL-OSI: Coastal Financial Corporation Announces Fourth Quarter 2024 Results

Source: GlobeNewswire (MIL-OSI)

EVERETT, Wash., Jan. 28, 2025 (GLOBE NEWSWIRE) — Coastal Financial Corporation (Nasdaq: CCB) (the “Company”, “Coastal”, “we”, “our”, or “us”), the holding company for Coastal Community Bank (the “Bank”), through which it operates a community-focused bank with an industry leading banking as a service (“BaaS”) segment, today reported unaudited financial results for the quarter ended December 31, 2024, including net income of $13.4 million, or $0.94 per diluted common share, compared to $13.5 million, or $0.97 per diluted common share, for the three months ended September 30, 2024 and $45.2 million, or $3.26 per diluted common share, for the year ended December 31, 2024, compared to $44.6 million, or $3.27 per diluted common share for the year ended December 31, 2023.

Management Discussion of the Quarter and Full-year Results

“2024 was highlighted by the completion of our $98.0 million capital raise during the fourth quarter, which we will utilize to support growth of the Bank including in our CCBX segment,” said CEO Eric Sprink. “We saw high quality net loan growth of $67.7 million despite selling $845.5 million in loans during the fourth quarter, and our CCBX program fee income continued to increase which was up 56.9% for full-year 2024 relative to the prior year. We continue to invest heavily in CCBX to support future growth, and we are pleased to have three letters of intent (“LOI”) signed going into 2025 with an active pipeline.”

Key Points for Fourth Quarter and Our Go-Forward Strategy

Completed Capital Raise Allows CCBX Growth to Continue. During the fourth quarter of 2024, we completed a $98.0 million common equity raise, which was priced at $71.00/share. Proceeds will be used for general corporate purposes and to support growth of the Bank including in our CCBX segment. As of December 31, 2024 we had three signed LOIs and continue to have an active pipeline for 2025. The growth in common-equity tier 1 and total risk-based capital to 12.04% and 14.67%, respectively, includes the benefit of the capital raise.
Strong Annual Growth in CCBX Program Fees. Total BaaS program fee income was $25.6 million for the year ended December 31, 2024, an increase of $9.3 million, or 56.9%, from the year ended December 31, 2023, and is representative of growth in partner transaction activity and expanded product offerings within our CCBX operating segment. Trends in CCBX noninterest income were also positive during the quarter, with total program fees of $8.2 million for the three months ended December 31, 2024, an increase of $1.8 million, or 27.6%, from the three months ended September 30, 2024.
Investments for Growth Continues. Total non-interest expense of $64.2 million was down $1.4 million, or 2.1%, as compared to $65.6 million in the third quarter of 2024, mainly driven by lower BaaS loan expense, partially offset by higher salaries and employee benefits, point of sale expense, and legal and professional expenses. As we increase the number of new CCBX partners and programs launching in 2025, we expect that expenses will tend to be front-loaded with a focus on compliance and operational risk before any new program reaches significant revenues.
Off Balance Sheet Activity Update. During the fourth quarter of 2024, we sold $845.5 million of loans, the majority of which were credit card receivables, and swept $273.2 million of deposits off balance-sheet. We are able to retain a portion of the fee income on these sold credit card loans. As of December 31, 2024 there were 182,449 credit cards with fee earning potential, an increase of 101,023 compared to the quarter ended September 30, 2024 and an increase of 172,400 from December 31, 2023.
Continued Monitoring of CCBX Risk. We remain fully indemnified against fraud and 98.7% indemnified against credit risk with our CCBX partners as of year-end of 2024.

Fourth Quarter 2024 Financial Highlights

The tables below outline some of our key operating metrics.

	Three Months Ended
(Dollars in thousands, except share and per share data; unaudited)	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
Income Statement Data:
Interest and dividend income	$	96,587		$	105,079		$	97,487		$	90,472		$	88,243
Interest expense		30,071			32,892			31,250			29,536			28,586
Net interest income		66,516			72,187			66,237			60,936			59,657
Provision for credit losses		61,867			70,257			62,325			83,158			60,789
Net interest (expense)/ income after provision for credit losses		4,649			1,930			3,912			(22,222	)		(1,132	)
Noninterest income		76,756			80,068			69,918			86,955			64,694
Noninterest expense		64,206			65,616			58,809			56,018			51,703
Provision for income tax		3,832			2,926			3,425			1,915			2,847
Net income		13,367			13,456			11,596			6,800			9,012

	As of and for the Three Month Period
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
Balance Sheet Data:
Cash and cash equivalents	$	452,513		$	484,026		$	487,245		$	515,128		$	483,128
Investment securities		47,321			48,620			49,213			50,090			150,364
Loans held for sale		20,600			7,565			—			797			—
Loans receivable		3,486,565			3,418,832			3,326,460			3,199,554			3,026,092
Allowance for credit losses		(176,994	)		(170,263	)		(147,914	)		(139,258	)		(116,958	)
Total assets		4,121,208			4,065,821			3,961,546			3,865,258			3,753,366
Interest bearing deposits		3,057,808			3,047,861			2,949,643			2,888,867			2,735,161
Noninterest bearing deposits		527,524			579,427			593,789			574,112			625,202
Core deposits ⁽¹⁾		3,123,434			3,190,869			3,528,339			3,447,864			3,342,004
Total deposits		3,585,332			3,627,288			3,543,432			3,462,979			3,360,363
Total borrowings		47,884			47,847			47,810			47,771			47,734
Total shareholders’ equity		438,704			331,930			316,693			303,709			294,978

Share and Per Share Data ⁽²⁾:
Earnings per share – basic	$	0.97		$	1.00		$	0.86		$	0.51		$	0.68
Earnings per share – diluted	$	0.94		$	0.97		$	0.84		$	0.50		$	0.66
Dividends per share		—			—			—			—			—
Book value per share ⁽³⁾	$	29.37		$	24.51		$	23.54		$	22.65		$	22.17
Tangible book value per share ⁽⁴⁾	$	29.37		$	24.51		$	23.54		$	22.65		$	22.17
Weighted avg outstanding shares – basic		13,828,605			13,447,066			13,412,667			13,340,997			13,286,828
Weighted avg outstanding shares – diluted		14,268,229			13,822,270			13,736,508			13,676,917			13,676,513
Shares outstanding at end of period		14,935,298			13,543,282			13,453,805			13,407,320			13,304,339
Stock options outstanding at end of period		186,354			198,370			286,119			309,069			354,969

See footnotes that follow the tables below

	As of and for the Three Month Period
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
Credit Quality Data:
Nonperforming assets ⁽⁵⁾ to total assets		1.52	%		1.63	%		1.34	%		1.42	%		1.43	%
Nonperforming assets ⁽⁵⁾ to loans receivable and OREO		1.80	%		1.94	%		1.60	%		1.71	%		1.78	%
Nonperforming loans ⁽⁵⁾ to total loans receivable		1.80	%		1.94	%		1.60	%		1.71	%		1.78	%
Allowance for credit losses to nonperforming loans		282.5	%		256.5	%		278.1	%		253.8	%		217.2	%
Allowance for credit losses to total loans receivable		5.08	%		4.98	%		4.45	%		4.35	%		3.86	%
Gross charge-offs	$	61,585		$	53,305		$	55,207		$	58,994		$	47,652
Gross recoveries	$	5,646		$	4,069		$	1,973		$	1,776		$	2,781
Net charge-offs to average loans ⁽⁶⁾		6.51	%		5.65	%		6.57	%		7.34	%		5.92	%

Capital Ratios:
Company
Tier 1 leverage capital		10.78	%		8.40	%		8.31	%		8.24	%		8.10	%
Common equity Tier 1 risk-based capital		12.04	%		9.24	%		9.03	%		8.98	%		9.10	%
Tier 1 risk-based capital		12.14	%		9.34	%		9.13	%		9.08	%		9.20	%
Total risk-based capital		14.67	%		11.89	%		11.70	%		11.70	%		11.87	%
Bank
Tier 1 leverage capital		10.64	%		9.29	%		9.24	%		9.19	%		9.06	%
Common equity Tier 1 risk-based capital		11.99	%		10.34	%		10.15	%		10.14	%		10.30	%
Tier 1 risk-based capital		11.99	%		10.34	%		10.15	%		10.14	%		10.30	%
Total risk-based capital		13.28	%		11.63	%		11.44	%		11.43	%		11.58	%

⁽¹⁾Core deposits are defined as all deposits excluding brokered and time deposits.
⁽²⁾Share and per share amounts are based on total actual or average common shares outstanding, as applicable.
⁽³⁾We calculate book value per share as total shareholders’ equity at the end of the relevant period divided by the outstanding number of our common shares at the end of each period.
⁽⁴⁾Tangible book value per share is a non-GAAP financial measure. We calculate tangible book value per share as total shareholders’ equity at the end of the relevant period, less goodwill and other intangible assets, divided by the outstanding number of our common shares at the end of each period. The most directly comparable GAAP financial measure is book value per share. We had no goodwill or other intangible assets as of any of the dates indicated. As a result, tangible book value per share is the same as book value per share as of each of the dates indicated.
⁽⁵⁾Nonperforming assets and nonperforming loans include loans 90+ days past due and accruing interest.
⁽⁶⁾Annualized calculations.

Key Performance Ratios

Return on average assets (“ROA”) was 1.30% for the quarter ended December 31, 2024 compared to 1.34% and 0.97% for the quarters ended September 30, 2024 and December 31, 2023, respectively. ROA for the quarter ended December 31, 2024, decreased 0.04% and increased 0.33% compared to September 30, 2024 and December 31, 2023, respectively. Noninterest expenses were lower for the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024 largely due to a decrease in BaaS loan expense, which is directly related to the amount of interest earned on CCBX loans, and higher than the quarter ended December 31, 2023 largely due to an increase in salaries and employee benefits, data processing and software licenses, legal and professional expenses and point of sale expenses, all of which are related to the growth of Company and investments in technology and risk management.

Yield on earning assets and yield on loans receivable decreased 1.14% and 0.99%, respectively, for the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024. This decrease is due to a combination of factors. We continue to refine our credit approach with partners, widening the scope of loans that we are moving to nonaccrual, which decreased loan interest income in the quarter ended December 31, 2024 as compared to prior quarters. Average loans receivable as of December 31, 2024 decreased $45.4 million compared to September 30, 2024 as we continue to sell CCBX loans as part of our on-going strategy to manage the loan portfolio and credit quality. New loans are being booked with enhanced credit standards, which typically results in a lower interest rate than some of the higher risk loans that have paid off or we have chosen to sell.

The following table shows the Company’s key performance ratios for the periods indicated.

	Three Months Ended					Twelve Months Ended
(unaudited)	December 31, 2024	September 30, 2024	June 30, 2024	March 31, 2024	December 31, 2023	December 31, 2024	December 31, 2023

Return on average assets ⁽¹⁾	1.30%	1.34%	1.21%	0.73%	0.97%	1.15%	1.28%
Return on average equity ⁽¹⁾	14.90%	16.67%	15.22%	9.21%	12.35%	14.11%	16.41%
Yield on earnings assets ⁽¹⁾	9.65%	10.79%	10.49%	10.07%	9.77%	10.25%	9.82%
Yield on loans receivable ⁽¹⁾	10.44%	11.43%	11.23%	10.85%	10.71%	10.99%	10.60%
Cost of funds ⁽¹⁾	3.24%	3.62%	3.60%	3.52%	3.39%	3.49%	2.91%
Cost of deposits ⁽¹⁾	3.21%	3.59%	3.58%	3.49%	3.36%	3.46%	2.87%
Net interest margin ⁽¹⁾	6.65%	7.41%	7.13%	6.78%	6.61%	6.99%	7.10%
Noninterest expense to average assets ⁽¹⁾	6.23%	6.54%	6.14%	6.04%	5.56%	6.24%	5.90%
Noninterest income to average assets ⁽¹⁾	7.45%	7.98%	7.30%	9.38%	6.95%	8.00%	5.97%
Efficiency ratio	44.81%	43.10%	43.19%	37.88%	41.58%	42.21%	45.92%
Loans receivable to deposits ⁽²⁾	97.82%	94.46%	93.88%	92.42%	90.05%	97.8%	90.1%

⁽¹⁾Annualized calculations shown for quarterly periods presented.
⁽²⁾Includes loans held for sale.

Management Outlook; CEO Eric Sprink

“As we look forward to 2025, our strategy involves selectively expanding our current base of CCBX partners while continuing to invest in and enhance our technology and risk management infrastructure. This will enable us to support the next phase of growth within CCBX more efficiently. Additionally, we are focused on growing noninterest income through increased transaction activity and new product offerings with our established partners. We plan to continue selling credit card loans while retaining a portion of the fee income for our role in processing transactions, which offers an additional source of noninterest income without adding on-balance-sheet risk. We believe that by increasing noninterest income, we can mitigate the uncertainties associated with fluctuating interest rates and provide a more stable income stream in the future.” said CEO Eric Sprink.

Coastal Financial Corporation Overview

The Company has one main subsidiary, the Bank which consists of three segments: CCBX, the community bank and treasury & administration. The CCBX segment includes all of our BaaS activities, the community bank segment includes all community banking activities, and the treasury & administration segment includes treasury management, overall administration and all other aspects of the Company.

CCBX Performance Update

Our CCBX segment continues to evolve, and we have 24 relationships, at varying stages, including three signed letters of intent as of December 31, 2024. We continue to refine the criteria for CCBX partnerships, exploring relationships with larger more established partners, with experienced management teams, existing customer bases and strong financial positions and will continue to exit relationships where it makes sense for us to do so.

As we explore relationships with new partners we plan to continue expanding product offerings with our existing CCBX partners. As we become more proficient in the BaaS space we aim to cultivate new relationships that align with our long-term goals. We believe that a strategy of adding new partnerships and launching new products with existing partners positions us to reach a wide and established customer base with a modest increase in regulatory risk given that we have already vetted existing partners and have an operational history. Increases in partner activity/transaction counts is positively impacting noninterest income and we expect that trend to continue as products launched earlier in the year gain traction. We plan to continue selling loans as part of our strategy to balance partner and lending limits, and manage the loan portfolio and credit quality. We retain a portion of the fee income for our role in processing transactions on sold credit card balances, and plan to continue this strategy to provide an on-going and passive revenue stream with no on balance sheet risk.

The following table illustrates the activity and evolution in CCBX relationships for the periods presented.

	As of
(unaudited)	December 31, 2024	September 30, 2024	December 31, 2023
Active	19	19	19
Friends and family / testing	1	1	1
Implementation / onboarding	1	1	1
Signed letters of intent	3	1	0
Wind down – active but preparing to exit relationship	0	0	0
Total CCBX relationships	24	22	21

CCBX loans increased $82.3 million, or 5.4%, to $1.60 billion despite selling $845.5 million loans during the three months ended December 31, 2024. In accordance with the program agreement for one partner, effective April 1, 2024, the portion of the CCBX portfolio that we are responsible for losses on decreased from 10% to 5%. At December 31, 2024 the portion of this portfolio for which we are responsible represented $20.6 million in loans.

The following table details the CCBX loan portfolio:

CCBX	As of
	December 31, 2024					September 30, 2024					December 31, 2023
(dollars in thousands; unaudited)	Balance			% to Total		Balance			% to Total		Balance			% to Total
Commercial and industrial loans:
Capital call lines	$	109,017		6.8	%	$	103,924		6.8	%	$	87,494		7.3	%
All other commercial & industrial loans		33,961		2.1			36,494		2.4			54,298		4.5
Real estate loans:
Residential real estate loans		267,707		16.7			265,402		17.5			238,035		19.9
Consumer and other loans:
Credit cards		528,554		33.0			633,691		41.6			505,837		42.3
Other consumer and other loans		664,780		41.4			482,228		31.7			310,574		26.0
Gross CCBX loans receivable		1,604,019		100.0	%		1,521,739		100.0	%		1,196,238		100.0	%
Net deferred origination (fees) costs		(442	)				(447	)				(300	)
Loans receivable	$	1,603,577				$	1,521,292				$	1,195,938
Loan Yield – CCBX ⁽¹⁾⁽²⁾		15.28	%				17.35	%				17.36	%

⁽¹⁾CCBX yield does not include the impact of BaaS loan expense. BaaS loan expense represents the amount paid or payable to partners for credit enhancements and originating & servicing CCBX loans. See reconciliation of the non-GAAP measures at the end of this earnings release for the impact of BaaS loan expense on CCBX loan yield.
⁽²⁾Loan yield is annualized for the three months ended for each period presented and includes loans held for sale and nonaccrual loans.

The increase in CCBX loans in the quarter ended December 31, 2024, includes an increase of $77.4 million or 6.9%, in consumer and other loans, an increase of $5.1 million, or 4.9%, in capital call lines as a result of normal balance fluctuations and business activities, and an increase of $2.3 million, or 0.9%, in residential real estate loans. We continue to monitor and manage the CCBX loan portfolio, and sold $845.5 million in CCBX loans during the quarter ended December 31, 2024 compared to sales of $423.7 million in the quarter ended September 30, 2024. We continue to reposition ourselves by managing CCBX credit and concentration levels in an effort to optimize our loan portfolio and generate off balance sheet fee income.

CCBX loan yield decreased 2.06% for the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024 as a result of our widening the scope of loans that we are moving to nonaccrual, which decreased loan interest income in the quarter ended December 31, 2024. Also contributing to the decrease are lower interest rates on new CCBX loans, which are replacing higher risk and higher rate loans that have paid off or were sold as part of our strategy to manage the loan portfolio and credit quality. The recent decrease in the Fed funds interest rate further contributed to the change.

The following chart show the growth in credit card accounts that we are able to generate fee income from. This includes accounts with balances, which are included in our loan totals, and accounts that have been sold and have no corresponding balance in our loan totals, but that we are still able to generate fee income on.

The following table details the CCBX deposit portfolio:

CCBX	As of
	December 31, 2024					September 30, 2024					December 31, 2023
(dollars in thousands; unaudited)	Balance			% to Total		Balance			% to Total		Balance			% to Total
Demand, noninterest bearing	$	55,686		2.7	%	$	60,655		2.9	%	$	63,630		3.4	%
Interest bearing demand and money market		1,958,459		94.9			1,991,858		94.6			1,794,168		96.3
Savings		5,710		0.3			5,204		0.3			4,964		0.3
Total core deposits		2,019,855		97.9			2,057,717		97.8			1,862,762		100.0
Other deposits		44,233		2.1			47,046		2.2			—		—
Total CCBX deposits	$	2,064,088		100.0	%	$	2,104,763		100.0	%	$	1,862,762		100.0	%
Cost of deposits ⁽¹⁾		4.19	%				4.82	%				4.90	%

⁽¹⁾Cost of deposits is annualized for the three months ended for each period presented.

CCBX deposits decreased $40.7 million, or 1.9%, in the three months ended December 31, 2024 to $2.06 billion as a result of normal balance fluctuations. This excludes the $273.2 million in CCBX deposits that were transferred off balance sheet for increased Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and sweep purposes, compared to $214.5 million for the quarter ended September 30, 2024. Amounts in excess of FDIC insurance coverage are transferred, using a third party facilitator/vendor sweep product, to participating financial institutions.

Community Bank Performance Update

In the quarter ended December 31, 2024, the community bank saw net loans decrease $14.6 million, or 0.8%, to $1.88 billion.

The following table details the Community Bank loan portfolio:

Community Bank	As of
	December 31, 2024					September 30, 2024					December 31, 2023
(dollars in thousands; unaudited)	Balance			% to Total		Balance			% to Total		Balance			% to Total
Commercial and industrial loans	$	150,395		8.0	%	$	152,161		8.0	%	$	149,502		8.2	%
Real estate loans:
Construction, land and land development loans		148,198		7.8			163,051		8.6			157,100		8.5
Residential real estate loans		202,064		10.7			212,467		11.2			225,391		12.3
Commercial real estate loans		1,374,801		72.8			1,362,452		71.5			1,303,533		70.9
Consumer and other loans:
Other consumer and other loans		13,542		0.7			14,173		0.7			1,628		0.1
Gross Community Bank loans receivable		1,889,000		100.0	%		1,904,304		100.0	%		1,837,154		100.0	%
Net deferred origination fees		(6,012	)				(6,764	)				(7,000	)
Loans receivable	$	1,882,988				$	1,897,540				$	1,830,154
Loan Yield⁽¹⁾		6.53	%				6.64	%				6.32	%

⁽¹⁾Loan yield is annualized for the three months ended for each period presented and includes loans held for sale and nonaccrual loans.

Community bank loans decreased $14.9 million in construction, land and land development loans, decreased $1.8 million in commercial and industrial loans and decreased $631,000 in consumer and other loans, and were partially offset by an increase in commercial real estate loans of $12.3 million during the quarter ended December 31, 2024.

The following table details the community bank deposit portfolio:

Community Bank	As of
	December 31, 2024					September 30, 2024					December 31, 2023
(dollars in thousands; unaudited)	Balance			% to Total		Balance			% to Total		Balance			% to Total
Demand, noninterest bearing	$	471,838		31.0	%	$	518,772		34.1	%	$	561,572		37.5	%
Interest bearing demand and money market		570,625		37.5			552,108		36.3			846,072		56.5
Savings		61,116		4.0			62,272		4.1			71,598		4.8
Total core deposits		1,103,579		72.5			1,133,152		74.5			1,479,242		98.8
Other deposits		400,118		26.3			373,681		24.5			1		0.0
Time deposits less than $100,000		5,920		0.4			6,305		0.4			8,109		0.5
Time deposits $100,000 and over		11,627		0.8			9,387		0.6			10,249		0.7
Total Community Bank deposits	$	1,521,244		100.0	%	$	1,522,525		100.0	%	$	1,497,601		100.0	%
Cost of deposits⁽¹⁾		1.86	%				1.92	%				1.57	%

⁽¹⁾Cost of deposits is annualized for the three months ended for each period presented.

Community bank deposits decreased $1.3 million, or 0.1%, during the three months ended December 31, 2024 to $1.52 billion as result of normal balance fluctuations. The community bank segment includes noninterest bearing deposits of $471.8 million, or 31.0%, of total community bank deposits, resulting in a cost of deposits of 1.86%, which compared to 1.92% for the quarter ended September 30, 2024, largely due to the decreases in the Fed funds rate late in the third quarter and during the fourth quarter of 2024. The cost of community bank deposits are projected to decline further as the Fed funds rate had a decrease of 0.25%, which occurred in December 2024 and the full quarterly effect of that decrease will not be recognized until the first quarter of 2025.

Net Interest Income and Margin Discussion

Net interest income was $66.5 million for the quarter ended December 31, 2024, a decrease of $5.7 million, or 7.9%, from $72.2 million for the quarter ended September 30, 2024, and an increase of $6.9 million, or 11.5%, from $59.7 million for the quarter ended December 31, 2023. The decrease in net interest income compared to September 30, 2024, was a result of a decrease in average loans receivable as a result of selling $845.5 million in CCBX loans during the quarter ended December 31, 2024, the recent decrease in the Fed funds interest rate, and continued enhancements to our partner credit practices that resulted in a reduction of interest income on loans. The increase in net interest income compared to December 31, 2023 was largely related to increased yield on loans resulting from higher interest rates and growth in higher yielding loans, partially offset by an increase in cost of funds relating to higher interest rates and growth in interest bearing deposits.

Net interest margin was 6.65% for the three months ended December 31, 2024, compared to 7.41% for the three months ended September 30, 2024, largely due to lower loan yield. Net interest margin, net of BaaS loan expense, (A reconciliation of the non-GAAP measures are set forth in the Non-GAAP Financial Measures section of this earnings release.) was 4.16% for the three months ended December 31, 2024, compared to 4.06% for the three months ended September 30, 2024. Net interest margin was 6.61% for the three months ended December 31, 2023. The increase in net interest margin for the three months ended December 31, 2024 compared to the three months ended December 31, 2023 was largely due to an increase in loan yield, partially offset by higher interest rates on interest bearing deposits. Interest and fees on loans receivable decreased $9.9 million, or 9.9%, to $89.7 million for the three months ended December 31, 2024, compared to $99.6 million for the three months ended September 30, 2024, as a result of loan sales and a decrease in the Fed funds interest rate. Additionally, as we continue to refine our credit approach with partners, we are widening the scope of loans that we are moving to nonaccrual which decreased interest income in the quarter ended December 31, 2024 and lowered loan yield and net interest margin; however this also decreased BaaS loan expense (which is in noninterest expense) resulting in no impact to net income. Interest and fees on loans receivable increased $8.6 million, or 10.5%, compared to $81.2 million for the three months ended December 31, 2023, due to an increase in outstanding balances and higher interest rates. Net interest margin, net of Baas loan expense (A reconciliation of the non-GAAP measures are set forth in the Non-GAAP Financial Measures section of this earnings release.) increased 0.10% for the three months ended December 31, 2024, compared to the three months ended September 30, 2024 and increased 0.25% compared the three months ended December 31, 2023.

The following tables illustrate how net interest margin and loan yield is affected by BaaS loan expense:

Consolidated	As of and for the Three Months Ended									As of and for the Twelve Months Ended
(dollars in thousands; unaudited)	December 31 2024			September 30 2024			December 31 2023			December 31 2024			December 31 2023
Net interest margin, net of BaaS loan expense:
Net interest margin ⁽¹⁾		6.65	%		7.41	%		6.61	%		6.99	%		7.10	%
Earning assets		3,980,078			3,875,911			3,581,772			3,802,275			3,364,406
Net interest income (GAAP)		66,516			72,187			59,657			265,876			238,727
Less: BaaS loan expense		(24,859	)		(32,612	)		(24,310	)		(111,384	)		(86,900	)
Net interest income, net of BaaS loan expense⁽²⁾	$	41,657		$	39,575		$	35,347		$	154,492		$	151,827
Net interest margin, net of BaaS loan expense ⁽¹⁾⁽²⁾		4.16	%		4.06	%		3.92	%		4.06	%		4.51	%
Loan income net of BaaS loan expense divided by average loans:
Loan yield (GAAP)⁽¹⁾		10.44	%		11.43	%		10.71	%		10.99	%		10.60	%
Total average loans receivable	$	3,419,476		$	3,464,871		$	3,007,289		$	3,320,582		$	2,936,908
Interest and earned fee income on loans (GAAP)		89,714			99,590			81,159			364,869			311,441
BaaS loan expense		(24,859	)		(32,612	)		(24,310	)		(111,384	)		(86,900	)
Net loan income⁽²⁾	$	64,855		$	66,978		$	56,849		$	253,485		$	224,541
Loan income, net of BaaS loan expense, divided by average loans ⁽¹⁾⁽²⁾		7.55	%		7.69	%		7.50	%		7.63	%		7.65	%

⁽¹⁾ Annualized calculations shown for periods presented.
⁽²⁾ A reconciliation of the non-GAAP measures are set forth at the end of this earnings release.

Average investment securities decreased $820,000 to $48.2 million compared to the three months ended September 30, 2024 and decreased $101.5 million compared to the three months ended December 31, 2023 as a result of principal paydowns and maturing securities.

Cost of funds was 3.24% for the quarter ended December 31, 2024, a decrease of 38 basis points from the quarter ended September 30, 2024 and a decrease of 16 basis points from the quarter ended December 31, 2023. Cost of deposits for the quarter ended December 31, 2024 was 3.21%, compared to 3.59% for the quarter ended September 30, 2024, and 3.36% for the quarter ended December 31, 2023. The decreased cost of funds and deposits compared to September 30, 2024 and December 31, 2023 was largely due to the recent reductions in the Fed funds rate.

The following table summarizes the average yield on loans receivable and cost of deposits:

	For the Three Months Ended
	December 31, 2024		September 30, 2024		December 31, 2023
	Yield on Loans ⁽²⁾	Cost of Deposits ⁽²⁾	Yield on Loans ⁽²⁾	Cost of Deposits ⁽²⁾	Yield on Loans ⁽²⁾	Cost of Deposits ⁽²⁾
Community Bank	6.53%	1.86%	6.64%	1.92%	6.32%	1.57%
CCBX ⁽¹⁾	15.28%	4.19%	17.35%	4.82%	17.36%	4.90%
Consolidated	10.44%	3.21%	11.43%	3.59%	10.71%	3.36%

⁽¹⁾Annualized calculations for periods shown for credit and fraud enhancements and originating & servicing CCBX loans. To determine Net BaaS loan income earned from CCBX loan relationships, the Company takes BaaS loan interest income and deducts BaaS loan expense to arrive at Net BaaS loan income which can be compared to interest income on the Company’s community bank loans. See reconciliation of the non-GAAP measures at the end of this earnings release for the impact of BaaS loan expense on CCBX loan yield.
⁽²⁾Annualized calculations for periods shown.

The following table illustrates how BaaS loan interest income is affected by BaaS loan expense resulting in net BaaS loan income and the associated yield:

	For the Three Months Ended
	December 31, 2024			September 30, 2024				December 31, 2023
(dollars in thousands, unaudited)	Income / Expense		Income / expense divided by average CCBX loans ⁽²⁾	Income / Expense		Income / expense divided by average CCBX loans⁽²⁾		Income / Expense		Income / expense divided by average CCBX loans ⁽²⁾
BaaS loan interest income	$	58,671	15.28%	$	67,692	17.35	%	$	52,327	17.36%
Less: BaaS loan expense		24,859	6.48%		32,612	8.36	%		24,310	8.06%
Net BaaS loan income ⁽¹⁾	$	33,812	8.81%	$	35,080	8.99	%	$	28,017	9.30%
Average BaaS Loans⁽³⁾	$	1,527,178		$	1,552,443			$	1,196,137

⁽¹⁾ A reconciliation of the non-GAAP measures are set forth at the end of this earnings release.
⁽²⁾ Annualized calculations shown for quarterly periods presented.
⁽³⁾ Includes loans held for sale.

Noninterest Income Discussion

Noninterest income was $76.8 million for the three months ended December 31, 2024, a decrease of $3.3 million from $80.1 million for the three months ended September 30, 2024, and an increase of $12.1 million from $64.7 million for the three months ended December 31, 2023. The decrease in noninterest income for the quarter ended December 31, 2024 as compared to the quarter ended September 30, 2024 was primarily due to a decrease of $3.3 million in total BaaS income. The $3.3 million decrease in total BaaS income included an $8.0 million decrease in BaaS credit enhancements related to the provision for credit losses, partially offset by a a $3.0 million increase in BaaS fraud enhancements and an increase of $1.8 million in BaaS program income. The $1.8 million increase in BaaS program income is largely due to higher reimbursement of expenses as well as an increase in transaction fees and interchange fees, our primary BaaS source for recurring fee income, as well as higher reimbursement of expenses (see “Appendix B” for more information on the accounting for BaaS allowance for credit losses and credit and fraud enhancements).

The $12.1 million increase in noninterest income over the quarter ended December 31, 2023 was primarily due to a $7.9 million increase in BaaS credit and fraud enhancements and an increase of $3.8 million in BaaS program income.

Noninterest Expense Discussion
Total noninterest expense decreased $1.4 million to $64.2 million for the three months ended December 31, 2024, compared to $65.6 million for the three months ended September 30, 2024, and increased $12.5 million from $51.7 million for the three months ended December 31, 2023. The decrease in noninterest expense for the quarter ended December 31, 2024, as compared to the quarter ended September 30, 2024, was primarily due to a $4.8 million decrease in BaaS expense from a $7.8 million decrease in BaaS loan expense, partially offset by a $3.0 million increase in BaaS fraud expense. BaaS loan expense represents the amount paid or payable to partners for credit enhancements, fraud enhancements, and originating & servicing CCBX loans. BaaS fraud expense represents non-credit fraud losses on partner’s customer loan and deposit accounts. A portion of this expense is realized during the quarter in which the loss occurs, and a portion is estimated based on historical or other information from our partners. Other variances that partially offset the net decrease in noninterest expense include an increase of $1.4 million in point of sale expenses as a result of increased partner transaction activity, an increase of $893,000 in salaries and employee benefits and an increase of $1.0 million in legal and professional fees as part of our continued investments in technology and risk management.

The increase in noninterest expenses for the quarter ended December 31, 2024 compared to the quarter ended December 31, 2023 was largely due to an increase of $4.8 million in BaaS partner expense primarily from a $4.3 million increase in BaaS fraud expense, a $549,000 increase in BaaS loan expense, a $2.0 million increase in legal and professional expenses, a $1.8 million increase in point of sale expenses, a $1.5 million increase in salary and employee benefits, and a $1.2 million increase in data processing and software licenses due to enhancements in technology.

Certain noninterest expenses are reimbursed by our CCBX partners. In accordance with GAAP we recognize all expenses in noninterest expense and all reimbursement of expenses from our CCBX partner in noninterest income. The following table reflects the portion of noninterest expenses that are reimbursed by partners to assist the understanding of how the increases in noninterest expense are related to expenses incurred for and reimbursed by CCBX partners:

	Three Months Ended
	December 31,		September 30,		December 31,
(dollars in thousands; unaudited)	2024		2024		2023
Total noninterest expense (GAAP)	$	64,206	$	65,616	$	51,703
Less: BaaS loan expense		24,859		32,612		24,310
Less: BaaS fraud expense		5,043		2,084		779
Less: Reimbursement of expenses (Baas)		3,468		1,843		1,076
Noninterest expense, net of Baas loan expense, BaaS fraud expense and reimbursement of expenses (BaaS) ⁽¹⁾	$	30,836	$	29,077	$	25,538

⁽¹⁾ A reconciliation of the non-GAAP measures are set forth at the end of this earnings release.

Provision for Income Taxes

The provision for income taxes was $3.8 million for the three months ended December 31, 2024, $2.9 million for the three months ended September 30, 2024 and $2.8 million for the fourth quarter of 2023. The income tax provision was higher for the three months ended December 31, 2024 compared to the quarter ended September 30, 2024 as a result of the deductibility of certain equity awards which reduced tax expense during the quarter ended September 30, 2024 compared to the quarter ended December 31, 2024 despite net income being higher fairly even, and higher than the quarter ended December 31, 2023, primarily due to higher net income compared to that quarter, partially offset by the deductibility of certain equity awards.

The Company is subject to various state taxes that are assessed as CCBX activities and employees expand into other states, which has increased the overall tax rate used in calculating the provision for income taxes in the current and future periods. The Company uses a federal statutory tax rate of 21.0% as a basis for calculating provision for federal income taxes and 2.63% for calculating the provision for state income taxes.

Financial Condition Overview

Total assets increased $55.4 million, or 1.4%, to $4.12 billion at December 31, 2024 compared to $4.07 billion at September 30, 2024. The increase is primarily due to stronger loan growth, partially offset by lower cash balances. Total loans receivable increased $67.7 million to $3.49 billion at December 31, 2024, from $3.42 billion at September 30, 2024.

As of December 31, 2024, the Company had the capacity to borrow up to a total of $642.1 million from the Federal Reserve Bank discount window and Federal Home Loan Bank, and an additional $50.0 million from a correspondent bank. There were no borrowings outstanding on these lines as of December 31, 2024.

The Company completed a $98.0 million capital raise during the quarter ended December 31, 2024. After contributing $50.0 million to the Bank, the Company had a cash balance of $47.7 million as of December 31, 2024, which is retained for general operating purposes, including debt repayment, and for funding $480,000 in commitments to bank technology investment funds.

Uninsured deposits were $543.0 million as of December 31, 2024, compared to $542.2 million as of September 30, 2024.

Total shareholders’ equity as of December 31, 2024 increased $106.8 million since September 30, 2024. The increase in shareholders’ equity was primarily due to an increase of $93.4 million in common stock outstanding as a result of the aforementioned capital raise and, to a lessor extent, equity awards exercised during the three months ended December 31, 2024 combined with $13.4 million in net earnings.

The Company and the Bank remained well capitalized at December 31, 2024, as summarized in the following table.

(unaudited)	Coastal Community Bank	Coastal Financial Corporation	Minimum Well Capitalized Ratios under Prompt Corrective Action ⁽¹⁾
Tier 1 Leverage Capital (to average assets)	10.64%	10.78%	5.00%
Common Equity Tier 1 Capital (to risk-weighted assets)	11.99%	12.04%	6.50%
Tier 1 Capital (to risk-weighted assets)	11.99%	12.14%	8.00%
Total Capital (to risk-weighted assets)	13.28%	14.67%	10.00%

⁽¹⁾ Presents the minimum capital ratios for an insured depository institution, such as the Bank, to be considered well capitalized under the Prompt Corrective Action framework. The minimum requirements for the Company to be considered well capitalized under Regulation Y include to maintain, on a consolidated basis, a total risk-based capital ratio of 10.0 percent or greater and a tier 1 risk-based capital ratio of 6.0 percent or greater.

Asset Quality

The total allowance for credit losses was $177.0 million and 5.08% of loans receivable at December 31, 2024 compared to $170.3 million and 4.98% at September 30, 2024 and $117.0 million and 3.86% at December 31, 2023. The allowance for credit loss allocated to the CCBX portfolio was $158.1 million and 9.86% of CCBX loans receivable at December 31, 2024, with $18.9 million of allowance for credit loss allocated to the community bank or 1.00% of total community bank loans receivable.

The following table details the allocation of the allowance for credit loss as of the period indicated:

	As of December 31, 2024									As of September 30, 2024									As of December 31, 2023
(dollars in thousands; unaudited)	Community Bank			CCBX			Total			Community Bank			CCBX			Total			Community Bank			CCBX			Total
Loans receivable	$	1,882,988		$	1,603,577		$	3,486,565		$	1,897,540		$	1,521,292		$	3,418,832		$	1,830,154		$	1,195,938		$	3,026,092
Allowance for credit losses		(18,924	)		(158,070	)		(176,994	)		(20,132	)		(150,131	)		(170,263	)		(21,595	)		(95,363	)		(116,958	)
Allowance for credit losses to total loans receivable		1.00	%		9.86	%		5.08	%		1.06	%		9.87	%		4.98	%		1.18	%		7.97	%		3.86	%

Net charge-offs totaled $55.9 million for the quarter ended December 31, 2024, compared to $49.2 million for the quarter ended September 30, 2024 and $44.9 million for the quarter ended December 31, 2023. Net charge-offs as a percent of average loans increased to 6.51% for the quarter ended December 31, 2024 compared to 5.65% for the quarter ended September 30, 2024. CCBX partner agreements provide for a credit enhancement that covers the net-charge-offs on CCBX loans and negative deposit accounts by indemnifying or reimbursing incurred losses, except in accordance with the program agreement for one partner where the Company was responsible for credit losses on approximately 5% of a $324.6 million loan portfolio. At December 31, 2024, our portion of this portfolio represented $20.6 million in loans. Net charge-offs for this $20.6 million in loans were $1.1 million for the three months ended December 31, 2024, compared to $1.1 million for the three months ended September 30, 2024 and $1.5 million for the three months ended December 31, 2023.

The following table details net charge-offs for the community bank and CCBX for the period indicated:

	Three Months Ended
	December 31, 2024									September 30, 2024									December 31, 2023
(dollars in thousands; unaudited)	Community Bank			CCBX			Total			Community Bank			CCBX			Total			Community Bank			CCBX			Total
Gross charge-offs	$	139		$	61,446		$	61,585		$	398		$	52,907		$	53,305		$	2		$	47,650		$	47,652
Gross recoveries		(3	)		(5,643	)		(5,646	)		(3	)		(4,066	)		(4,069	)		(4	)		(2,777	)		(2,781	)
Net charge-offs	$	136		$	55,803		$	55,939		$	395		$	48,841		$	49,236		$	(2	)	$	44,873		$	44,871
Net charge-offs to average loans ⁽¹⁾		0.03	%		14.54	%		6.51	%		0.08	%		12.52	%		5.65	%		0.00	%		14.88	%		5.92	%

⁽¹⁾ Annualized calculations shown for periods presented.

During the quarter ended December 31, 2024, a $63.7 million provision for credit losses was recorded for CCBX partner loans, compared to the $72.1 million provision for credit losses was recorded for CCBX partner loans for the quarter ended September 30, 2024, the provision was based on management’s analysis, bringing the CCBX allowance for credit losses to $158.1 million at December 31, 2024 compared to $150.1 million at September 30, 2024. The increase in the allowance is due to the addition of new loans, partially offset by loan sales. CCBX loans have a higher level of expected losses than our community bank loans, which is reflected in the factors for the allowance for credit losses. Agreements with our CCBX partners provide for a credit enhancement which protects the Bank by indemnifying or reimbursing incurred losses.

In accordance with accounting guidance, we estimate and record a provision for expected losses for these CCBX loans and reclassified negative deposit accounts. When the provision for CCBX credit losses and provision for unfunded commitments is recorded, a credit enhancement asset is also recorded on the balance sheet through noninterest income (BaaS credit enhancements). Expected losses are recorded in the allowance for credit losses. The credit enhancement asset is relieved when credit enhancement recoveries are received from the CCBX partner. If our partner is unable to fulfill their contracted obligations then the Bank could be exposed to additional credit losses. Management regularly evaluates and manages this counterparty risk.

The factors used in management’s analysis for community bank credit losses indicated that a provision recapture of $1.1 million and was needed for the quarter ended December 31, 2024 compared to a provision recapture of $519,000 and provision of $277,000 for the quarters ended September 30, 2024 and December 31, 2023, respectively. The recapture in the current period was due to the decrease in the community bank loan portfolio combined with an improvement in the forward look, which is driven by the future projected unemployment and GDP curves, which flattened since last quarter, lessening the impact of this factor.

The following table details the provision expense/(recapture) for the community bank and CCBX for the period indicated:

	Three Months Ended
(dollars in thousands; unaudited)	December 31, 2024			September 30, 2024			December 31, 2023
Community bank	$	(1,071	)	$	(519	)	$	277
CCBX		63,741			72,104			60,467
Total provision expense	$	62,670		$	71,585		$	60,744

A recapture for unfunded commitments of $803,000 was recorded for the quarter ended December 31, 2024 as a result of a decrease in the overall available balance combined with an improvement in the reserve rates.

At December 31, 2024, our nonperforming assets were $62.7 million, or 1.52%, of total assets, compared to $66.4 million, or 1.63%, of total assets, at September 30, 2024, and $53.8 million, or 1.43%, of total assets, at December 31, 2023. These ratios are impacted by nonperforming CCBX loans that are covered by CCBX partner credit enhancements. As of December 31, 2024, $60.8 million of the $62.6 million in nonperforming CCBX loans were covered by CCBX partner credit enhancements described above.

Nonperforming assets decreased $3.7 million during the quarter ended December 31, 2024, compared to the quarter ended September 30, 2024. This change is due to a decrease in CCBX and community bank nonaccrual loans. Community bank nonperforming loans decreased $1.0 million from September 30, 2024 to $100,000 as of December 31, 2024, and CCBX nonperforming loans decreased $2.7 million to $62.6 million from September 30, 2024. The decrease in CCBX nonperforming loans is due to an decrease of $570,000 in nonaccrual loans from September 30, 2024 to $19.5 million. Some CCBX partners have a collection practice that places certain loans on nonaccrual status to improve collectability. $17.2 million of these loans are less than 90 days past due as of December 31, 2024. Additionally, there was a $2.2 million decrease in CCBX loans that are past due 90 days or more and still accruing interest. As a result of the type of loans (primarily consumer loans) originated through our CCBX partners we anticipate that balances 90 days past due or more and still accruing will generally increase as those loan portfolios grow. Installment/closed-end and revolving/open-end consumer loans originated through CCBX lending partners will continue to accrue interest until 120 and 180 days past due, respectively and are reported as substandard, 90 days or more days past due and still accruing. There were no repossessed assets or other real estate owned at December 31, 2024. Our nonperforming loans to loans receivable ratio was 1.80% at December 31, 2024, compared to 1.94% at September 30, 2024, and 1.78% at December 31, 2023.

For the quarter ended December 31, 2024, there were $136,000 community bank net charge-offs and $55.8 million in net charge-offs were recorded on CCBX loans. These CCBX loans have a higher level of expected losses than our community bank loans, which is reflected in the factors for the allowance for credit losses.

The following table details the Company’s nonperforming assets for the periods indicated.

Consolidated	As of
(dollars in thousands; unaudited)	December 31, 2024			September 30, 2024			December 31, 2023
Nonaccrual loans:
Commercial and industrial loans	$	334		$	531		$	—
Real estate loans:
Residential real estate		—			44			170
Commercial real estate		—			831			7,145
Consumer and other loans:
Credit cards		10,262			7,987			—
Other consumer and other loans		8,967			11,713			—
Total nonaccrual loans		19,563			21,106			7,315
Accruing loans past due 90 days or more:
Commercial & industrial loans		1,006			1,566			2,086
Real estate loans:
Residential real estate loans		2,608			3,025			1,115
Consumer and other loans:
Credit cards		34,490			34,562			34,835
Other consumer and other loans		4,989			6,111			8,488
Total accruing loans past due 90 days or more		43,093			45,264			46,524
Total nonperforming loans		62,656			66,370			53,839
Real estate owned		—			—			—
Repossessed assets		—			—			—
Total nonperforming assets	$	62,656		$	66,370		$	53,839
Total nonaccrual loans to loans receivable		0.56	%		0.62	%		0.24	%
Total nonperforming loans to loans receivable		1.80	%		1.94	%		1.78	%
Total nonperforming assets to total assets		1.52	%		1.63	%		1.43	%

The following tables detail the CCBX and community bank nonperforming assets which are included in the total nonperforming assets table above.

CCBX	As of
(dollars in thousands; unaudited)	December 31, 2024			September 30, 2024			December 31, 2023
Nonaccrual loans:
Commercial and industrial loans:
All other commercial & industrial loans	$	234		$	333		$	—
Consumer and other loans:
Credit cards		10,262			7,987			—
Other consumer and other loans		8,967			11,713			—
Total nonaccrual loans		19,463			20,033			—
Accruing loans past due 90 days or more:
Commercial & industrial loans		1,006			1,566			2,086
Real estate loans:
Residential real estate loans		2,608			3,025			1,115
Consumer and other loans:
Credit cards		34,490			34,562			34,835
Other consumer and other loans		4,989			6,111			8,488
Total accruing loans past due 90 days or more		43,093			45,264			46,524
Total nonperforming loans		62,556			65,297			46,524
Other real estate owned		—			—			—
Repossessed assets		—			—			—
Total nonperforming assets	$	62,556		$	65,297		$	46,524
Total CCBX nonperforming assets to total consolidated assets		1.52	%		1.61	%		1.24	%

Community Bank	As of
(dollars in thousands; unaudited)	December 31, 2024		September 30, 2024			December 31, 2023
Nonaccrual loans:
Commercial and industrial loans	$	100	$	198		$	—
Real estate:
Residential real estate		—		44			170
Commercial real estate		—		831			7,145
Total nonaccrual loans		100		1,073			7,315
Accruing loans past due 90 days or more:
Total accruing loans past due 90 days or more		—		—			—
Total nonperforming loans		100		1,073			7,315
Other real estate owned		—		—			—
Repossessed assets		—		—			—
Total nonperforming assets	$	100	$	1,073		$	7,315
Total community bank nonperforming assets to total consolidated assets	< 0.01%			0.03	%		0.19	%

About Coastal Financial

Coastal Financial Corporation (Nasdaq: CCB) (the “Company”), is an Everett, Washington based bank holding company whose wholly owned subsidiaries are Coastal Community Bank (“Bank”) and Arlington Olympic LLC. The $4.12 billion Bank provides service through 14 branches in Snohomish, Island, and King Counties, the Internet and its mobile banking application. The Bank provides banking as a service to broker-dealers, digital financial service providers, companies and brands that want to provide financial services to their customers through the Bank’s CCBX segment. To learn more about the Company visit www.coastalbank.com.

CCB-ER

Contact

Eric Sprink, Chief Executive Officer, (425) 357-3659
Joel Edwards, Executive Vice President & Chief Financial Officer, (425) 357-3687

Forward-Looking Statements

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. Any statements about our management’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. Any or all of the forward-looking statements in this earnings release may turn out to be inaccurate. The inclusion of or reference to forward-looking information in this earnings release should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of risks, uncertainties and assumptions that are difficult to predict. Factors that could cause actual results to differ materially from those in the forward-looking statements include, without limitation, the risks and uncertainties discussed under “Risk Factors” in our Annual Report on Form 10-K for the most recent period filed and in any of our subsequent filings with the Securities and Exchange Commission.

If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. You are cautioned not to place undue reliance on forward-looking statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by law.

COASTAL FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands; unaudited)

ASSETS
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
Cash and due from banks	$	36,533		$	45,327		$	59,995		$	32,790		$	31,345
Interest earning deposits with other banks		415,980			438,699			427,250			482,338			451,783
Investment securities, available for sale, at fair value		35			38			39			41			99,504
Investment securities, held to maturity, at amortized cost		47,286			48,582			49,174			50,049			50,860
Other investments		10,800			10,757			10,664			10,583			10,227
Loans held for sale		20,600			7,565			—			797			—
Loans receivable		3,486,565			3,418,832			3,326,460			3,199,554			3,026,092
Allowance for credit losses		(176,994	)		(170,263	)		(147,914	)		(139,258	)		(116,958	)
Total loans receivable, net		3,309,571			3,248,569			3,178,546			3,060,296			2,909,134
CCBX credit enhancement asset		181,890			167,251			143,485			137,276			107,921
CCBX receivable		14,138			16,060			11,520			10,369			9,088
Premises and equipment, net		27,431			25,833			24,526			22,995			22,090
Lease right-of-use assets		5,219			5,427			5,635			5,756			5,932
Accrued interest receivable		21,104			23,664			23,617			24,681			26,819
Bank-owned life insurance, net		13,375			13,255			13,132			12,991			12,870
Deferred tax asset, net		3,600			3,083			2,221			2,221			3,806
Other assets		13,646			11,711			11,742			12,075			11,987
Total assets	$	4,121,208		$	4,065,821		$	3,961,546		$	3,865,258		$	3,753,366

LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES
Deposits	$	3,585,332		$	3,627,288		$	3,543,432		$	3,462,979		$	3,360,363
Subordinated debt, net		44,293			44,256			44,219			44,181			44,144
Junior subordinated debentures, net		3,591			3,591			3,591			3,590			3,590
Deferred compensation		332			369			405			442			479
Accrued interest payable		962			1,070			999			1,061			892
Lease liabilities		5,398			5,609			5,821			5,946			6,124
CCBX payable		29,171			39,188			34,536			33,095			33,651
Other liabilities		13,425			12,520			11,850			10,255			9,145
Total liabilities		3,682,504			3,733,891			3,644,853			3,561,549			3,458,388
SHAREHOLDERS’ EQUITY
Common Stock		228,177			134,769			132,989			131,601			130,136
Retained earnings		210,529			197,162			183,706			172,110			165,311
Accumulated other comprehensive loss, net of tax		(2	)		(1	)		(2	)		(2	)		(469	)
Total shareholders’ equity		438,704			331,930			316,693			303,709			294,978
Total liabilities and shareholders’ equity	$	4,121,208		$	4,065,821		$	3,961,546		$	3,865,258		$	3,753,366

COASTAL FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts; unaudited)

	Three Months Ended
	December 31, 2024		September 30, 2024		June 30, 2024			March 31, 2024			December 31, 2023
INTEREST AND DIVIDEND INCOME
Interest and fees on loans	$	89,714	$	99,590	$	90,944		$	84,621		$	81,159
Interest on interest earning deposits with other banks		6,021		4,781		5,683			4,780			5,687
Interest on investment securities		661		675		686			1,034			1,225
Dividends on other investments		191		33		174			37			172
Total interest income		96,587		105,079		97,487			90,472			88,243
INTEREST EXPENSE
Interest on deposits		29,404		32,083		30,578			28,867			27,916
Interest on borrowed funds		667		809		672			669			670
Total interest expense		30,071		32,892		31,250			29,536			28,586
Net interest income		66,516		72,187		66,237			60,936			59,657
PROVISION FOR CREDIT LOSSES		61,867		70,257		62,325			83,158			60,789
Net interest income/(expense) after provision for credit losses		4,649		1,930		3,912			(22,222	)		(1,132	)
NONINTEREST INCOME
Service charges and fees		932		952		946			908			957
Loan referral fees		—		—		—			168			—
Unrealized gain (loss) on equity securities, net		1		2		9			15			80
Other income		473		486		257			308			60
Noninterest income, excluding BaaS program income and BaaS indemnification income		1,406		1,440		1,212			1,399			1,097
Servicing and other BaaS fees		1,043		1,044		1,525			1,131			1,015
Transaction fees		1,783		1,696		1,309			1,122			1,006
Interchange fees		1,916		1,853		1,625			1,539			1,272
Reimbursement of expenses		3,468		1,843		1,637			1,033			1,076
BaaS program income		8,210		6,436		6,096			4,825			4,369
BaaS credit enhancements		62,097		70,108		60,826			79,808			58,449
BaaS fraud enhancements		5,043		2,084		1,784			923			779
BaaS indemnification income		67,140		72,192		62,610			80,731			59,228
Total noninterest income		76,756		80,068		69,918			86,955			64,694
NONINTEREST EXPENSE
Salaries and employee benefits		17,994		17,101		17,005			17,984			16,490
Occupancy		958		964		985			1,029			976
Data processing and software licenses		4,010		4,297		3,625			3,381			2,781
Legal and professional expenses		4,606		3,597		3,631			3,672			2,649
Point of sale expense		2,745		1,351		852			869			899
Excise taxes		778		762		(706	)		320			449
Federal Deposit Insurance Corporation (“FDIC”) assessments		750		740		690			683			665
Director and staff expenses		683		559		470			400			478
Marketing		28		67		14			53			138
Other expense		1,752		1,482		1,383			1,867			1,089
Noninterest expense, excluding BaaS loan and BaaS fraud expense		34,304		30,920		27,949			30,258			26,614
BaaS loan expense		24,859		32,612		29,076			24,837			24,310
BaaS fraud expense		5,043		2,084		1,784			923			779
BaaS loan and fraud expense		29,902		34,696		30,860			25,760			25,089
Total noninterest expense		64,206		65,616		58,809			56,018			51,703
Income before provision for income taxes		17,199		16,382		15,021			8,715			11,859
PROVISION FOR INCOME TAXES		3,832		2,926		3,425			1,915			2,847
NET INCOME	$	13,367	$	13,456	$	11,596		$	6,800		$	9,012
Basic earnings per common share	$	0.97	$	1.00	$	0.86		$	0.51		$	0.68
Diluted earnings per common share	$	0.94	$	0.97	$	0.84		$	0.50		$	0.66
Weighted average number of common shares outstanding:
Basic		13,828,605		13,447,066		13,412,667			13,340,997			13,286,828
Diluted		14,268,229		13,822,270		13,736,508			13,676,917			13,676,513

COASTAL FINANCIAL CORPORATION
AVERAGE BALANCES, YIELDS, AND RATES – QUARTERLY
(Dollars in thousands; unaudited)

	For the Three Months Ended
	December 31, 2024							September 30, 2024							December 31, 2023
	Average Balance			Interest & Dividends		Yield / Cost ⁽¹⁾		Average Balance			Interest & Dividends		Yield / Cost ⁽¹⁾		Average Balance			Interest & Dividends		Yield / Cost ⁽¹⁾
Assets
Interest earning assets:
Interest earning deposits with other banks	$	501,654		$	6,021	4.77	%	$	350,915		$	4,781	5.42	%	$	413,127		$	5,687	5.46	%
Investment securities, available for sale ⁽²⁾		39			—	—			40			—	—			100,204			546	2.16
Investment securities, held to maturity ⁽²⁾		48,126			661	5.46			48,945			675	5.49			49,469			679	5.45
Other investments		10,783			191	7.05			11,140			33	1.18			11,683			172	5.84
Loans receivable ⁽³⁾		3,419,476			89,714	10.44			3,464,871			99,590	11.43			3,007,289			81,159	10.71
Total interest earning assets		3,980,078			96,587	9.65			3,875,911			105,079	10.79			3,581,772			88,243	9.77
Noninterest earning assets:
Allowance for credit losses		(156,687	)						(151,292	)						(95,391	)
Other noninterest earning assets		277,922							268,903							204,052
Total assets	$	4,101,313						$	3,993,522						$	3,690,433

Liabilities and Shareholders’ Equity
Interest bearing liabilities:
Interest bearing deposits	$	3,068,357		$	29,404	3.81	%	$	2,966,527		$	32,083	4.30	%	$	2,660,235		$	27,916	4.16	%
FHLB advances and other borrowings		—			1	—			9,717			140	5.73			3			—	—
Subordinated debt		44,272			599	5.38			44,234			598	5.38			44,121			598	5.38
Junior subordinated debentures		3,591			67	7.42			3,591			71	7.87			3,590			72	7.96
Total interest bearing liabilities		3,116,220			30,071	3.84			3,024,069			32,892	4.33			2,707,949			28,586	4.19
Noninterest bearing deposits		577,453							588,178							640,424
Other liabilities		50,824							60,101							52,450
Total shareholders’ equity		356,816							321,174							289,612
Total liabilities and shareholders’ equity	$	4,101,313						$	3,993,522						$	3,690,435
Net interest income				$	66,516						$	72,187						$	59,657
Interest rate spread						5.82	%						6.46	%						5.59	%
Net interest margin ⁽⁴⁾						6.65	%						7.41	%						6.61	%

⁽¹⁾Yields and costs are annualized.
⁽²⁾For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
⁽³⁾Includes loans held for sale and nonaccrual loans.
⁽⁴⁾Net interest margin represents net interest income divided by the average total interest earning assets.

COASTAL FINANCIAL CORPORATION
SELECTED AVERAGE BALANCES, YIELDS, AND RATES – BY SEGMENT – QUARTERLY
(Dollars in thousands; unaudited)

	For the Three Months Ended
	December 31, 2024						September 30, 2024						December 31, 2023
(dollars in thousands, unaudited)	Average Balance		Interest & Dividends		Yield / Cost ⁽¹⁾		Average Balance		Interest & Dividends		Yield / Cost ⁽¹⁾		Average Balance		Interest & Dividends		Yield / Cost ⁽¹⁾
Community Bank
Assets
Interest earning assets:
Loans receivable ⁽²⁾	$	1,892,298	$	31,043	6.53	%	$	1,912,428	$	31,898	6.64	%	$	1,811,152	$	28,832	6.32	%
Total interest earning assets		1,892,298		31,043	6.53			1,912,428		31,898	6.64			1,811,152		28,832	6.32
Liabilities
Interest bearing liabilities:
Interest bearing deposits		1,029,346		7,161	2.77	%		982,280		7,264	2.94	%		951,148		6,090	2.54	%
Intrabank liability		357,442		4,290	4.77			406,641		5,540	5.42			275,995		3,799	5.46
Total interest bearing liabilities		1,386,788		11,451	3.28			1,388,921		12,804	3.67			1,227,143		9,889	3.20
Noninterest bearing deposits		505,510						523,507						584,009
Net interest income			$	19,592					$	19,094					$	18,943
Net interest margin⁽³⁾					4.12	%					3.97	%					4.15	%

CCBX
Assets
Interest earning assets:
Loans receivable ⁽²⁾⁽⁴⁾	$	1,527,178	$	58,671	15.28	%	$	1,552,443	$	67,692	17.35	%	$	1,196,137	$	52,327	17.36	%
Intrabank asset		583,776		7,007	4.78			496,475		6,764	5.42			569,365		7,837	5.46
Total interest earning assets		2,110,954		65,678	12.38			2,048,918		74,456	14.46			1,765,502		60,164	13.52
Liabilities
Interest bearing liabilities:
Interest bearing deposits		2,039,011		22,243	4.34	%		1,984,247		24,819	4.98	%		1,709,087		21,826	5.07	%
Total interest bearing liabilities		2,039,011		22,243	4.34			1,984,247		24,819	4.98			1,709,087		21,826	5.07
Noninterest bearing deposits		71,943						64,671						56,415
Net interest income			$	43,435					$	49,637					$	38,338
Net interest margin⁽³⁾					8.19	%					9.64	%					8.62	%
Net interest margin, net of Baas loan expense ⁽⁵⁾					3.50	%					3.31	%					3.15	%

	For the Three Months Ended
	December 31, 2024						September 30, 2024							December 31, 2023
(dollars in thousands, unaudited)	Average Balance		Interest & Dividends		Yield / Cost ⁽¹⁾		Average Balance			Interest & Dividends		Yield / Cost ⁽¹⁾		Average Balance		Interest & Dividends		Yield / Cost ⁽¹⁾
Treasury & Administration
Assets
Interest earning assets:
Interest earning deposits with other banks	$	501,654	$	6,021	4.77	%	$	350,915		$	4,781	5.42	%	$	413,127	$	5,687	5.46	%
Investment securities, available for sale ⁽⁶⁾		39		—	—			40			—	—			100,204		546	2.16
Investment securities, held to maturity ⁽⁶⁾		48,126		661	5.46			48,945			675	5.49			49,469		679	5.45
Other investments		10,783		191	7.05			11,140			33	1.18			11,683		172	5.84
Total interest earning assets		560,602		6,873	4.88	%		411,040	—		5,489	5.31	%		574,483		7,084	4.89	%
Liabilities
Interest bearing liabilities:
FHLB advances and borrowings	$	—	$	1	—	%		9,717			140	5.73	%		3		—	—	%
Subordinated debt		44,272		599	5.38	%		44,234			598	5.38	%		44,121		598	5.38	%
Junior subordinated debentures		3,591		67	7.42			3,591			71	7.87			3,590		72	7.96
Intrabank liability, net ⁽⁷⁾		226,334		2,717	4.78			89,834			1,224	5.42			293,370		4,038	5.46
Total interest bearing liabilities		274,197		3,384	4.91			147,376			2,033	5.49			341,084		4,708	5.48
Net interest income			$	3,489						$	3,456					$	2,376
Net interest margin⁽³⁾					2.48	%						3.34	%					1.64	%

(1) Yields and costs are annualized.
⁽²⁾Includes loans held for sale and nonaccrual loans.
⁽³⁾Net interest margin represents net interest income divided by the average total interest earning assets.
⁽⁴⁾CCBX yield does not include the impact of BaaS loan expense. BaaS loan expense represents the amount paid or payable to partners for credit enhancements, fraud enhancements and originating & servicing CCBX loans. See reconciliation of the non-GAAP measures at the end of this earnings release for the impact of BaaS loan expense on CCBX loan yield.
⁽⁵⁾Net interest margin, net of BaaS loan expense, includes the impact of BaaS loan expense. BaaS loan expense represents the amount paid or payable to partners for credit enhancements, fraud enhancements, originating & servicing CCBX loans. See reconciliation of the non-GAAP measures at the end of this earnings release.
⁽⁶⁾For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
⁽⁷⁾Intrabank assets and liabilities are consolidated for period calculations and presented as intrabank asset, net or intrabank liability, net in the table above.

Non-GAAP Financial Measures

The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance.

However, these non-GAAP financial measures are supplemental and are not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these adjusted measures, this presentation may not be comparable to other similarly titled adjusted measures reported by other companies.

The following non-GAAP measures are presented to illustrate the impact of BaaS loan expense on net loan income and yield on loans and CCBX loans and the impact of BaaS loan expense on net interest income and net interest margin.

Loan income, net of BaaS loan expense, divided by average loans, is a non-GAAP measure that includes the impact BaaS loan expense on loan income and the yield on loans. The most directly comparable GAAP measure is yield on loans.

Net BaaS loan income divided by average CCBX loans is a non-GAAP measure that includes the impact BaaS loan expense on net BaaS loan income and the yield on CCBX loans. The most directly comparable GAAP measure is yield on CCBX loans.

Net interest income, net of BaaS loan expense, is a non-GAAP measure that includes the impact BaaS loan expense on net interest income. The most directly comparable GAAP measure is net interest income.

CCBX net interest margin, net of BaaS loan expense, is a non-GAAP measure that includes the impact of BaaS loan expense on net interest rate margin. The most directly comparable GAAP measure is CCBX net interest margin.

Reconciliations of the GAAP and non-GAAP measures are presented below.

CCBX	As of and for the Three Months Ended									As of and for the Twelve Months Ended
(dollars in thousands; unaudited)	December 31 2024			September 30 2024			December 31 2023			December 31 2024			December 31 2023
Net BaaS loan income divided by average CCBX loans:
CCBX loan yield (GAAP)⁽¹⁾		15.28	%		17.35	%		17.36	%		16.89	%		16.89	%
Total average CCBX loans receivable	$	1,527,178		$	1,552,443		$	1,196,137		$	1,427,571		$	1,210,413
Interest and earned fee income on CCBX loans (GAAP)		58,671			67,692			52,327			241,134			204,458
BaaS loan expense		(24,859	)		(32,612	)		(24,310	)		(111,384	)		(86,900	)
Net BaaS loan income	$	33,812		$	35,080		$	28,017		$	129,750		$	117,558
Net BaaS loan income divided by average CCBX loans ⁽¹⁾		8.81	%		8.99	%		9.30	%		9.09	%		9.71	%
CCBX net interest margin, net of BaaS loan expense:
CCBX net interest margin ⁽¹⁾		8.19	%		9.64	%		8.62	%		8.87	%		9.65	%
CCBX earning assets		2,110,954			2,048,918			1,765,502			1,999,695			1,574,334
Net interest income (GAAP)		43,435			49,637			38,338			177,320			151,883
Less: BaaS loan expense		(24,859	)		(32,612	)		(24,310	)		(111,384	)		(86,900	)
Net interest income, net of BaaS loan expense	$	18,576		$	17,025		$	14,028		$	65,936		$	64,983
CCBX net interest margin, net of BaaS loan expense ⁽¹⁾		3.50	%		3.31	%		3.15	%		3.30	%		4.13	%

Consolidated	As of and for the Three Months Ended									As of and for the Twelve Months Ended
(dollars in thousands; unaudited)	December 31 2024			September 30 2024			December 31 2023			December 31 2024			December 31 2023
Net interest margin, net of BaaS loan expense:
Net interest margin ⁽¹⁾		6.65	%		7.41	%		6.61	%		6.99	%		7.10	%
Earning assets		3,980,078			3,875,911			3,581,772			3,802,275			3,364,406
Net interest income (GAAP)		66,516			72,187			59,657			265,876			238,727
Less: BaaS loan expense		(24,859	)		(32,612	)		(24,310	)		(111,384	)		(86,900	)
Net interest income, net of BaaS loan expense	$	41,657		$	39,575		$	35,347		$	154,492		$	151,827
Net interest margin, net of BaaS loan expense ⁽¹⁾		4.16	%		4.06	%		3.92	%		4.06	%		4.51	%
Loan income net of BaaS loan expense divided by average loans:
Loan yield (GAAP)⁽¹⁾		10.44	%		11.43	%		10.71	%		10.99	%		10.60	%
Total average loans receivable	$	3,419,476		$	3,464,871		$	3,007,289		$	3,320,582		$	2,936,908
Interest and earned fee income on loans (GAAP)		89,714			99,590			81,159			364,869			311,441
BaaS loan expense		(24,859	)		(32,612	)		(24,310	)		(111,384	)		(86,900	)
Net loan income	$	64,855		$	66,978		$	56,849		$	253,485		$	224,541
Loan income, net of BaaS loan expense, divided by average loans ⁽¹⁾		7.55	%		7.69	%		7.50	%		7.63	%		7.65	%

⁽¹⁾ Annualized calculations for periods presented.

The following non-GAAP measure is presented to illustrate the impact of BaaS loan expense, BaaS fraud expense and reimbursement of expenses (BaaS) on noninterest expense. The most comparable GAAP measure is noninterest expense.

	As of and for the Three Months Ended
(dollars in thousands, unaudited)	December 31, 2024		September 30, 2024		December 31, 2023
Noninterest expense, net of reimbursement of expenses (BaaS)
Noninterest expense (GAAP)	$	64,206	$	65,616	$	51,703
Less: BaaS loan expense		24,859		32,612		24,310
Less: BaaS fraud expense		5,043		2,084		779
Less: Reimbursement of expenses		3,468		1,843		1,076
Noninterest expense, net of BaaS loan expense, BaaS fraud expense and reimbursement of expenses	$	30,836	$	29,077	$	25,538

APPENDIX A –
As of December 31, 2024

Industry Concentration

We have a diversified loan portfolio, representing a wide variety of industries. Our major categories of loans are commercial real estate, consumer and other loans, residential real estate, commercial and industrial, and construction, land and land development loans. Together they represent $3.49 billion in outstanding loan balances. When combined with $1.96 billion in unused commitments the total of these categories is $5.46 billion.

Commercial real estate loans represent the largest segment of our loans, comprising 39.4% of our total balance of outstanding loans as of December 31, 2024. Unused commitments to extend credit represents an additional $34.2 million, and the combined total in commercial real estate loans represents $1.41 billion, or 25.8% of our total outstanding loans and loan commitments.

The following table summarizes our loan commitment by industry for our commercial real estate portfolio as of December 31, 2024:

(dollars in thousands; unaudited)	Outstanding Balance		Available Loan Commitments		Total Outstanding Balance & Available Commitment		% of Total Loans (Outstanding Balance & Available Commitment)		Average Loan Balance		Number of Loans
Apartments	$	405,561	$	4,953	$	410,514	7.5	%	$	3,937	103
Hotel/Motel		154,691		68		154,759	2.8			6,726	23
Convenience Store		139,735		575		140,310	2.6			2,329	60
Office		122,897		7,687		130,584	2.4			1,366	90
Retail		103,312		414		103,726	1.9			993	104
Warehouse		103,130		—		103,130	1.9			1,748	59
Mixed use		91,607		5,365		96,972	1.8			1,160	79
Mini Storage		80,837		10,183		91,020	1.7			3,674	22
Strip Mall		43,894		—		43,894	0.8			6,271	7
Manufacturing		37,617		1,200		38,817	0.7			1,297	29
Groups < 0.70% of total		91,520		3,777		95,297	1.7			1,173	78
Total	$	1,374,801	$	34,222	$	1,409,023	25.8	%	$	2,102	654

Consumer loans comprise 34.6% of our total balance of outstanding loans as of December 31, 2024. Unused commitments to extend credit represents an additional $735.8 million, and the combined total in consumer and other loans represents $1.94 billion, or 35.6% of our total outstanding loans and loan commitments. As illustrated in the table below, our CCBX partners bring in a large number of mostly smaller dollar loans, resulting in an average consumer loan balance of just $1,000. CCBX consumer loans are underwritten to CCBX credit standards and underwriting of these loans is regularly tested, including quarterly testing for partners with portfolio balances greater than $10.0 million.

The following table summarizes our loan commitment by industry for our consumer and other loan portfolio as of December 31, 2024:

(dollars in thousands; unaudited)	Outstanding Balance		Available Loan Commitments ⁽¹⁾		Total Outstanding Balance & Available Commitment ⁽¹⁾		% of Total Loans (Outstanding Balance & Available Commitment)		Average Loan Balance		Number of Loans
CCBX consumer loans
Credit cards	$	528,554	$	717,198	$	1,245,752	22.8	%	$	1.8	301,799
Installment loans		656,797		15,806		672,603	12.3			1.0	690,596
Lines of credit		722		1		723	0.0			1.4	524
Other loans		7,261		—		7,261	0.1			—	163,026
Community bank consumer loans
Installment loans		1,917		2		1,919	0.1			68.5	28
Lines of credit		181		344		525	0.0			5.7	32
Other loans		11,444		2,400		13,844	0.3			30.6	374
Total	$	1,206,876	$	735,751	$	1,942,627	35.6	%	$	1.0	1,156,379

⁽¹⁾Total exposure on CCBX loans is subject to CCBX partner/portfolio maximum limits.

Residential real estate loans comprise 13.4% of our total balance of outstanding loans as of December 31, 2024. Unused commitments to extend credit represents an additional $499.5 million, and the combined total in residential real estate loans represents $969.3 million, or 17.8% of our total outstanding loans and loan commitments.

The following table summarizes our loan commitment by industry for our residential real estate loan portfolio as of December 31, 2024:

(dollars in thousands; unaudited)	Outstanding Balance		Available Loan Commitments ⁽¹⁾		Total Outstanding Balance & Available Commitment ⁽¹⁾		% of Total Loans (Outstanding Balance & Available Commitment)		Average Loan Balance		Number of Loans
CCBX residential real estate loans
Home equity line of credit	$	267,707	$	453,369	$	721,076	13.2	%	$	27	10,092
Community bank residential real estate loans
Closed end, secured by first liens		165,433		2,080		167,513	3.1			537	308
Home equity line of credit		25,506		43,102		68,608	1.3			109	234
Closed end, second liens		11,125		965		12,090	0.2			371	30
Total	$	469,771	$	499,516	$	969,287	17.8	%	$	44	10,664

⁽¹⁾Total exposure on CCBX loans is subject to CCBX partner/portfolio maximum limits.

Commercial and industrial loans comprise 8.4% of our total balance of outstanding loans as of December 31, 2024. Unused commitments to extend credit represents an additional $645.5 million, and the combined total in commercial and industrial loans represents $938.9 million, or 17.2% of our total outstanding loans and loan commitments. Included in commercial and industrial loans is $109.0 million in outstanding capital call lines, with an additional $550.9 million in available loan commitments which is limited to a $350.0 million portfolio maximum. Capital call lines are provided to venture capital firms through one of our CCBX BaaS clients. These loans are secured by the capital call rights and are individually underwritten to the Bank’s credit standards and the underwriting is reviewed by the Bank on every capital call line.

The following table summarizes our loan commitment by industry for our commercial and industrial loan portfolio as of December 31, 2024:

(dollars in thousands; unaudited)	Outstanding Balance		Available Loan Commitments ⁽¹⁾		Total Outstanding Balance & Available Commitment ⁽¹⁾		% of Total Loans (Outstanding Balance & Available Commitment)		Average Loan Balance		Number of Loans
Consolidated C&I loans
Capital Call Lines	$	109,017	$	550,948	$	659,965	12.1	%	$	808	135
Construction/Contractor Services		24,367		36,343		60,710	1.1			121	202
Financial Institutions		48,648		—		48,648	0.9			4,054	12
Retail		28,533		5,664		34,197	0.6			14	2,052
Manufacturing		5,604		4,581		10,185	0.2			147	38
Medical / Dental / Other Care		7,074		2,641		9,715	0.2			544	13
Groups < 0.20% of total		70,130		45,360		115,490	2.1			55	1,275
Total	$	293,373	$	645,537	$	938,910	17.2	%	$	79	3,727

⁽¹⁾Total exposure on CCBX loans is subject to CCBX partner/portfolio maximum limits.

Construction, land and land development loans comprise 4.2% of our total balance of outstanding loans as of December 31, 2024. Unused commitments to extend credit represents an additional $47.8 million, and the combined total in construction, land and land development loans represents $196.0 million, or 3.6% of our total outstanding loans and loan commitments.

The following table details our loan commitment for our construction, land and land development portfolio as of December 31, 2024:

(dollars in thousands; unaudited)	Outstanding Balance		Available Loan Commitments		Total Outstanding Balance & Available Commitment		% of Total Loans (Outstanding Balance & Available Commitment)		Average Loan Balance		Number of Loans
Commercial construction	$	83,216	$	30,500	$	113,716	2.1	%	$	6,935	12
Residential construction		40,940		10,873		51,813	0.9			2,408	17
Developed land loans		8,305		456		8,761	0.2			489	17
Undeveloped land loans		8,665		4,816		13,481	0.2			619	14
Land development		7,072		1,157		8,229	0.2			643	11
Total	$	148,198	$	47,802	$	196,000	3.6	%	$	2,087	71

Exposure and risk in our construction, land and land development portfolio is declining compared to previous periods as indicated in the following table:

	Outstanding Balance as of
(dollars in thousands; unaudited)	December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Commercial construction	$	83,216	$	97,792	$	110,372	$	102,099	$	81,489
Residential construction		40,940		35,822		34,652		28,751		34,213
Undeveloped land loans		8,665		8,606		8,372		8,190		7,890
Developed land loans		8,305		14,863		13,954		14,307		20,515
Land development		7,072		5,968		5,714		7,515		12,993
Total	$	148,198	$	163,051	$	173,064	$	160,862	$	157,100

Commitments to extend credit total $1.96 billion at December 31, 2024, however we do not anticipate our customers using the $1.96 billion that is showing as available due to CCBX partner and portfolio limits.

The following table presents outstanding commitments to extend credit as of December 31, 2024:

Consolidated
(dollars in thousands; unaudited)	As of December 31, 2024
Commitments to extend credit:
Commercial and industrial loans	$	94,589
Commercial and industrial loans – capital call lines		550,948
Construction – commercial real estate loans		36,873
Construction – residential real estate loans		10,929
Residential real estate loans		499,516
Commercial real estate loans		34,222
Credit cards		717,198
Consumer and other loans		18,553
Total commitments to extend credit	$	1,962,828

We have individual CCBX partner portfolio limits with our each of our partners to manage loan concentration risk, liquidity risk, and counter-party partner risk. For example, as of December 31, 2024, capital call lines outstanding balance totaled $109.0 million, and while commitments totaled $550.9 million, the commitments are limited to a maximum of $350.0 million by agreement with the partner. If a CCBX partner goes over their individual limit, it would be a breach of their contract and the Bank may impose penalties and would have the choice to fund the loan.

See the table below for CCBX portfolio maximums and related available commitments:

CCBX
(dollars in thousands; unaudited)	Balance			Percent of CCBX loans receivable		Available Commitments ⁽¹⁾		Maximum Portfolio Size		Cash Reserve/Pledge Account Amount ⁽²⁾
Commercial and industrial loans:
Capital call lines	$	109,017		6.8	%	$	550,948	$	350,000	$	—
All other commercial & industrial loans		33,961		2.1			19,104		480,000		834
Real estate loans:
Home equity lines of credit ⁽³⁾		267,707		16.7			453,369		375,000		36,241
Consumer and other loans:
Credit cards – cash secured		211					—				—
Credit cards – unsecured		528,343					717,198				26,742
Credit cards – total		528,554		33.0			717,198		807,484		26,742
Installment loans – cash secured		127,014					15,806				—
Installment loans – unsecured		529,783					—				5,332
Installment loans – total		656,797		40.9			15,806		1,787,118		5,332
Other consumer and other loans		7,983		0.5			1		5,398		196
Gross CCBX loans receivable		1,604,019		100.0	%		1,756,426		3,805,000	$	69,345
Net deferred origination fees		(442	)
Loans receivable	$	1,603,577

(1) Remaining commitment available, net of outstanding balance.
(2) Balances are as of January 8, 2025.
(3) These home equity lines of credit are secured by residential real estate and are accessed by using a credit card, but are classified as 1-4 family residential properties per regulatory guidelines.

APPENDIX B –
As of December 31, 2024

CCBX – BaaS Reporting Information

During the quarter ended December 31, 2024, $62.1 million was recorded in BaaS credit enhancements related to the provision for credit losses – loans and reserve for unfunded commitments for CCBX partner loans and negative deposit accounts. Agreements with our CCBX partners provide for a credit enhancement provided by the partner which protects the Bank by indemnifying or reimbursing incurred losses. In accordance with accounting guidance, we estimate and record a provision for expected losses for these CCBX loans, unfunded commitments and negative deposit accounts. When the provision for credit losses – loans and provision for unfunded commitments is recorded, a credit enhancement asset is also recorded on the balance sheet through noninterest income (BaaS credit enhancements) in recognition of the CCBX partner legal commitment to indemnify or reimburse losses. The credit enhancement asset is relieved as credit enhancement payments and recoveries are received from the CCBX partner or taken from the partner’s cash reserve account. Agreements with our CCBX partners also provide protection to the Bank from fraud by indemnifying or reimbursing incurred fraud losses. BaaS fraud includes noncredit fraud losses on loans and deposits originated through partners. Fraud losses are recorded when incurred as losses in noninterest expense, and the enhancement received from the CCBX partner is recorded in noninterest income, resulting in a net impact of zero to the income statement. Many CCBX partners also pledge a cash reserve account at the Bank which the Bank can collect from when losses occur that is then replenished by the partner on a regular interval. Although agreements with our CCBX partners provide for credit enhancements that provide protection to the Bank from credit and fraud losses by indemnifying or reimbursing incurred credit and fraud losses, if our partner is unable to fulfill their contracted obligation then the bank would be exposed to additional loan and deposit losses if the cash flows on the loans were not sufficient to fund the reimbursement of loan losses, as a result of this counterparty risk. If a CCBX partner does not replenish their cash reserve account the Bank may consider an alternative plan for funding the cash reserve. This may involve the possibility of adjusting the funding amounts or timelines to better align with the partner’s specific situation. If a mutually agreeable funding plan is not agreed to, the Bank could declare the agreement in default, take over servicing and cease paying the partner for servicing the loan and providing credit enhancements. The Bank would evaluate any remaining credit enhancement asset from the CCBX partner in the event the partner failed to determine if a write-off is appropriate. If a write-off occurs, the Bank would retain the full yield and any fee income on the loan portfolio going forward, and our BaaS loan expense would decrease once default occurred and payments to the CCBX partner were stopped.

The Bank records contractual interest earned from the borrower on CCBX partner loans in interest income, adjusted for origination costs which are paid or payable to the CCBX partner. BaaS loan expense represents the amount paid or payable to partners for credit and fraud enhancements and originating & servicing CCBX loans. To determine net revenue (Net BaaS loan income) earned from CCBX loan relationships, the Bank takes BaaS loan interest income and deducts BaaS loan expense to arrive at Net BaaS loan income (A reconciliation of the non-GAAP measures are set forth in the preceding section of this earnings release.) which can be compared to interest income on the Company’s community bank loans.

The following table illustrates how CCBX partner loan income and expenses are recorded in the financial statements:

Loan income and related loan expense	Three Months Ended
(dollars in thousands; unaudited)	December 31, 2024			September 30, 2024			December 31, 2023
Yield on loans ⁽¹⁾		15.28	%		17.35	%		17.36	%
BaaS loan interest income	$	58,671		$	67,692		$	52,327
Less: BaaS loan expense		24,859			32,612			24,310
Net BaaS loan income ⁽²⁾	$	33,812		$	35,080		$	28,017
Net BaaS loan income divided by average BaaS loans ⁽¹⁾⁽²⁾		8.81	%		8.99	%		9.30	%

(1) Annualized calculation for quarterly periods shown.
(2) A reconciliation of the non-GAAP measures are set forth in the preceding section of this earnings release.

A decrease in average CCBX loans receivable resulted in decreased interest income on CCBX loans during the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024. The decrease in average CCBX loans receivable was primarily due to loan sales in the CCBX loan portfolio as part of our strategy to optimize the CCBX loan portfolio and strengthen our balance sheet through originating higher quality new loans and enhanced credit standards. These higher quality loans also have lower stated rates and expected losses. As a result, our yield on loans and our BaaS loan expense decrease by similar amounts. We continue to reposition ourselves by managing CCBX credit and concentration levels in an effort to optimize our loan portfolio and generate off balance sheet fee income. Growth in CCBX loans and deposits has resulted in increases in interest income and expense for the quarter ended December 31, 2024 compared to the quarter ended December 31, 2023.

The following tables are a summary of the interest components, direct fees, and expenses of BaaS for the periods indicated and are not inclusive of all income and expense related to BaaS.

Interest income	Three Months Ended
(dollars in thousands; unaudited)	December 31, 2024		September 30, 2024		December 31, 2023
Loan interest income	$	58,671	$	67,692	$	52,327
Total BaaS interest income	$	58,671	$	67,692	$	52,327

Interest expense	Three Months Ended
(dollars in thousands; unaudited)	December 31, 2024		September 30, 2024		December 31, 2023
BaaS interest expense	$	22,243	$	24,819	$	21,826
Total BaaS interest expense	$	22,243	$	24,819	$	21,826

BaaS income	Three Months Ended
(dollars in thousands; unaudited)	December 31, 2024		September 30, 2024		December 31, 2023
BaaS program income:
Servicing and other BaaS fees	$	1,043	$	1,044	$	1,015
Transaction fees		1,783		1,696		1,006
Interchange fees		1,916		1,853		1,272
Reimbursement of expenses		3,468		1,843		1,076
BaaS program income		8,210		6,436		4,369
BaaS indemnification income:
BaaS credit enhancements		62,097		70,108		58,449
BaaS fraud enhancements		5,043		2,084		779
BaaS indemnification income		67,140		72,192		59,228
Total noninterest BaaS income	$	75,350	$	78,628	$	63,597

Servicing and other BaaS fees decreased $1,000 in the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024 while transaction fees and interchange fees increased $87,000 and $63,000, respectively. We expect servicing and other BaaS fees to decrease and transaction and interchange fees to increase as partner activity grows and contracted minimum fees are replaced with recurring fees and then exceed those minimum fees. Increases in BaaS reimbursement of fees offsets increases in noninterest expense from BaaS expenses covered by CCBX partners.

BaaS loan and fraud expense:	Three Months Ended
(dollars in thousands; unaudited)	December 31, 2024		September 30, 2024		December 31, 2023
BaaS loan expense	$	24,859	$	32,612	$	24,310
BaaS fraud expense		5,043		2,084		779
Total BaaS loan and fraud expense	$	29,902	$	34,696	$	25,089

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/20c5a089-a44b-483e-acb5-fccbbe07fc10

The MIL Network –

January 29, 2025

MIL-OSI Economics: François Villeroy de Galhau: For a high speed and safe journey into the financial future

Source: Bank for International Settlements

Ladies and gentlemen,
It is a great pleasure to welcome you to this high-level conference organised by the Banque de France on speed and innovation, and how they could be disruptive for financial markets and market infrastructures. Let me thank Emmanuelle Assouan and her teams for setting up this event. I would also like to extend my warm thanks to all participants from industry, public authorities and central banks who will give their views during three roundtables today, including my colleagues and friends Andrea Maechler, Piero Cipollone and Naoto Shimoda.

It is a première for a Banque de France conference to be held here at the Cinémathèque française, which is definitely an excellent venue for our theme of today: we are here in the place where speed is made art. As you know, cinema was invented in France by the Lumière brothers in the late 19th century. During the projection in 1896 of one of their very first movies, The arrival of a train at La Ciotat station, the audience was so overwhelmed by the moving image of a train coming directly at them that people ran away. But we do not fear speed anymore, on the contrary: it has become a key success factor in financial markets and market infrastructures, yielding high benefits. Transactions and their settlement have already become dramatically swifter over the last decades – notably in France, which was at the forefront in dematerialising securities – and will continue gathering speed. I will first elaborate on the reasons why, in a fast-moving environment, resilience must be preserved in order to ensure financial stability (I). Our public-private partnership has to evolve, with a view to enhancing cross-border payments and the holistic project of creating a shared ledger (II).

I. A fast-moving financial system whose resilience must be preserved in order to ensure financial stability

Markets are undergoing structural changes, all driven by increased speed aimed at achieving higher efficiency. Automation and high-frequency trading are driving a rise in daily trading volumes; new participants have emerged, and incumbents have evolved. Nowadays, robots and algorithms are unlocking new possibilities, while artificial intelligence offers the promise of value added in trading, customer relationships and investment decisions. From photography to digital movies, from local theatres to global web platforms, cinematography has gone through technological revolutions over the years. However, whether it’s in cinema or finance, speed is not a goal per se. The social utility of certain accelerations such as high-frequency trading remains to be seen, and they carry risks. We must reflect on new guardrails to protect against possible increased market volatility – and even potential flash crashes caused by poorly coordinated algorithms that can amplify massive sell-offs.

Post-market processes are keeping pace with this acceleration in trading: settlement is getting ever faster. A few years ago, implementing T+2 (i.e. ensuring settlement within two days of transaction execution) was a major step forward for all players, as enshrined in the European CSDR regulation.ⁱ Nowadays we are once again aiming for more ambitious targets, with an objective of T+1 in Europe in 2027 – as has already been the case in the United States, Canada and Mexico since end-May last year. Interestingly, across the Atlantic, this evolution was driven by market players, who saw in the shortening of the settlement cycle an opportunity to further reduce liquidity, counterparty and operational risks. The American experience also shows that T+1 yields direct financial benefits, in particular a significant lowering of CCP margins. T+1 therefore received overall support in ESMA’s and the Commission’s public consultations. I trust that we are all well aware of the operational requirements and challenges to be met:ⁱⁱ preparatory work must start now, with the adaptation of IT systems and further automation of processes. It is also important to coordinate with the United Kingdom and Switzerland, and to pay due attention to the consequences in terms of shorter cut-offs – notably for FX transactions.

The tokenisation of assets is obviously another groundswell movement, which could further enhance the straight-through processing of trade and post-trade activities, and paves the way for yet another acceleration with a widespread implementation of T+0. It has the potential to generate even greater savings both for the financial industry and end-users. To date, the nascent DLTⁱⁱⁱ finance has used new forms of commercial bank money as settlement assets, such as tokenised deposits or so-called stablecoins. As experience has shown in the last few years, they are far from immune, and Europe has made the right step by adopting the MiCA regulation. Failing to regulate crypto-assets and non-banks today would merely sow the seeds for tomorrow’s financial crisis.

Beyond these regulatory issues, it has become more and more apparent that we currently lack the anchor provided by central bank money, which drastically reduces counterparty and liquidity risks, and crucially ensures the finality of payments. A wholesale central bank digital currency would ensure convertibility between tokenised assets, exactly as central banks currently ensure convertibility between commercial bank monies, allowing for delivery-versus-payment and payment-versus-payment. In short, tokenised central bank money would provide a “safety pivot”, and serve as a reliable basis of trust on which these new technologies could realise their full potential.

II. A step further with the interlinking of fast-payment systems and a European shared ledger to meet the challenges of transition and growth

Central banks must therefore keep up with these developments,^iv in order to explore the potential of DLT and foster innovation while preserving the anchoring role of central bank money. Building among others on the Banque de France’s pioneering experiments between 2020 and 2023,^v the Eurosystem conducted a series of new experiments on wholesale CBDC between April and November 2024,^vi with the active involvement of the Banque de France, Banca d’Italia and Bundesbank as solution providers. We witnessed active industry participation in the Eurosystem experiments, and I would like to take the opportunity to pay tribute to your strong commitment – which, I believe, also reflects the growing awareness of the need for a safe settlement asset.

Together, we successfully tested numerous and very diverse use cases, ranging from primary issues to cross-currency payments, repos, margin calls and asset management, to give a few examples. Actual settlement was even tested for the lifecycle management of securities and secondary market transactions. With this ambitious programme, we have further delivered on our learning-by-doing approach, which is of the essence. As announced, the Eurosystem will draw lessons from the exploratory work, including on how to facilitate the provision of central bank money settlement for wholesale asset transactions on DLT platforms. Clearly, it is in the interest of both European commercial banks and the public sector to work together towards a tokenised European framework: money is and will remain a public-private partnership, which has to evolve.

As regards cross-border payments, the Eurosystem has launched initiatives to help improve them, including exploratory work on linking TIPS with other fast-payment systems such as UPI in India. We thereby support the G20 roadmap for creating a faster, cheaper, more transparent and accessible global payments ecosystem, while ensuring secure and reliable instant payments. The G20 roadmap also foresees, in the longer term, the use of tokenisation to further enhance cross-border payments.

We now need to bring all these advances together to create a global motion picture, in a holistic manner. Here, the idea of a “unified ledger” put forward by the BIS^vii looks like more than a promising technology: a rallying concept, or even a utopia. This next-generation market infrastructure would take one day in the future the shape of a shared, seamless and programmable platform that integrates central bank money, commercial bank money and tokenised financial assets – which would call for redefined and improved public-private partnerships. Accordingly, in April 2024 the BIS launched Project Agorá,^viii to explore the tokenisation of cross-border payments to improve the existing correspondent banking model. This major project brings together seven central banks worldwide, including the Banque de France which represents the Eurosystem, and a large group of private financial firms. But a first and necessary step towards such a global infrastructure should be to build regional shared ledgers – one of which would be European.

A European shared ledger could prove an efficient means to overcome European market fragmentation and current inefficiencies, by facilitating the provision of seamlessly connected services across Europe. It would therefore act as a catalyst for a Savings and Investments Union, and provide tools such as green bonds and securities to finance the green transition, at a time where we have to mobilise Europe’s private savings surplus of more than EUR 300 billion a year. In short, it would be an important lever for achieving our climate but also digital transformations, which are among our main challenges; it would also help Europe to gain in both size – by unifying its single market – and speed. Achieving this ambitious vision requires moving forward step by step, in a phased approach. Rather than replacing existing infrastructures which have already helped to reduce fragmentation in Europe – like the harmonised settlement system T2S –, this new shared infrastructure would tackle markets which still rely on manual processes and lack standardisation, such as OTC markets and unlisted stocks. A crucial first step will be to make central bank money available on this infrastructure: this makes it all the more important to offer a wholesale CBDC solution in the short term to prepare this long term target.

Let me conclude with Billy Wilder, the director of Some like it hot. He once gave this sound piece of advice: “If you have a problem with the third act, the real problem is in the first act.” This leads me to a twofold conclusion: first, that it is the right time to engage in the design and experimentation of market infrastructures of the future; second, that fast-paced transformations should not be at the expense of past achievements in financial stability, and increase risks. Central bank money must remain the settlement asset at the core of the financial system, whether tokenised or not. Under this condition, our common technological breakthroughs could contribute to meeting our major challenges. Thank you for your attention.

MIL OSI Economics –

January 29, 2025

MIL-OSI United Nations: Deputy Secretary-General’s remarks at the Mission 300 Africa Energy Summit: “Introduction to the Panel on “Policies and reforms for transforming African energy” [as prepared for delivery]

Source: United Nations secretary general

Your Excellency Mr. Doto Biteko, Deputy Prime Minister and Minister for Energy of the United Republic of Tanzani], Excellencies, Ladies and Gentlemen,

I want to start by thanking the Government of Tanzania and the African Union for its leadership; and the World Bank, the African Development Bank, and the Mission 300 partners for convening this Summit.

Mission 300’s has undertaken an enormous task: to help close the energy access gap and unlock sustainable development across the continent by delivering electricity to 300 million Africans by 2030.

As we have heard, we face a stark reality: 685 million people across the continent still lack access to electricity, with the gap widening as population growth outpaces new electricity connections.

And yet, Africa is richly endowed with natural resources vital for renewable energy technologies: it is home to 60 per cent of the world’s best solar resources and possesses vast wind, hydro, and geothermal potential.

And critical minerals mined in Africa are powering the renewables revolution around the world.

Despite this abundance, and record global investments in renewable energies worldwide, Africa continues to be left behind and many Africans continue to lack access to clean, affordable energy.

This injustice must be urgently resolved.

Access to electricity is an essential development requirement, one that can also be the multiplier for acceleration in building a sustainable future for all

Providing clean energy to local communities, represents a unique opportunity to improve health, widen access to education and social protection, make food systems resilient, create green jobs and e-commerce and financial services while at the same time protecting the environment and the biodiversity.

We have heard our distinguished speakers discuss why companies and governments should get involved.

The business case is clear: the falling costs of renewables and storage offer a great opportunity to deliver access to energy, energy security and sovereignty, and climate resilience.

With the new African Continental Free Trade Area , aiming at a trade zone without barriers to the transfer of goods and services, the business opportunities will further multiply if the right policy environments, coherent and predictable, are put in place.

As we move into discussing what policies and reforms for transforming African Energy can enable millions to access to energy, I would like to focus on three areas of urgent attention for policy makers:

First, fostering policy coherence.

We are 5 years away from the target of our SDGs. And we are not on track.

Policy makers and the international institutions need to strive to ensure sector wide plans are coherent and aligned with the achievement of the SDGs due in 2030, while investors need robust regulatory laws in place to ensure business can operate aligned with them.

At this Summit, Mission 300 target countries are presenting their first national energy strategies for achieving universal energy access. These strategies need to be part of a broader plan, one that while achieving universal energy access need to be aligned with the new economy-wide national climate action plans – or NDCs – consistent with 1.5 degrees, well before COP 30 in November.

NDCs represent a unique opportunity for all countries to align their new climate plans and energy strategies, together with addressing adaptation needs.

NDCs must coordinate the transition from fossil fuels with scaling of renewables and grid modernization and expansion, ensuring energy security and affordability.

And they must be anchored in justice – providing support for affected workers and communities.

If done right, climate plans align with national development priorities and double as investment plans – becoming blueprints for a more sustainable and prosperous future.

Excellencies,

The Secretary-General’s panel on Critical Energy Transition Minerals offers important Principles and Actionable Recommendations to ensure this new era does not repeat historical patterns of exploitation.

SE4ALL, UN Resident Coordinators and Country Teams will continue to support country level policy reforms, integrate stakeholder innovations, build institutional capacities, and boost infrastructure investments across the entire clean energy supply chain.

Second, mobilizing finance and support.

While private sector investments and innovation are important, public financing, remains vital – especially in modernizing grid infrastructure to expand access and integrate renewables.

Blending concessional public funds with commercial funds can help multiply renewable energy investments in developing countries.

We must work to strengthen the health of Africa’s public finances, and tackle unsustainable debt burdens that are crowding out essential public investments.

The fourth conference on Finance for Development that will take place in July to underpin the needs for long-term concessional finance and the 1.3 trillion roadmap, agreed in Baku, that needs to be delivered by COP 30 in Brazil must provide investments to scale up, among others, the energy transition.

Third, enhancing transparent international cooperation.

International investments and cross-border partnerships hold the key to delivering electricity projects at a massive scale.

Institutions must be strengthened to operate in complex regulatory environments, with multiple actors across jurisdictions.

Public private partnerships need to be subject to stable and transparent public procurement rules throughout the whole project cycle, rules that prioritize long term sustainability and allow for mutually beneficial contractual relationships.

Transparency and accountability should be a hallmark of Mission 300, and set a new standard for cooperation across the continent.

Excellencies,

As we start the 5-year countdown to delivering on the Sustainable Development Goals, and mark the tenth-year anniversary of the Paris Agreement, let us work together to illuminate the lives of millions, power the industries of tomorrow, and ensure that no one is left behind in the race to deliver universal clean energy, climate resilience, and economic prosperity.

Thank you.

MIL OSI United Nations News –

January 29, 2025

MIL-OSI: First Financial Northwest, Inc. Reports Net Income of $1.2 Million or $0.13 per Diluted Share for the Fourth Quarter and $1.1 Million or $0.12 per Diluted Share for the Year Ended December 31, 2024

Source: GlobeNewswire (MIL-OSI)

RENTON, Wash., Jan. 28, 2025 (GLOBE NEWSWIRE) — First Financial Northwest, Inc. (the “Company”) (NASDAQ GS: FFNW), the holding company for First Financial Northwest Bank (the “Bank”), today reported net income for the quarter ended December 31, 2024, of $1.2 million, or $0.13 per diluted share, compared to a net loss of $608,000, or $(0.07) per diluted share, for the quarter ended September 30, 2024, and net income of $1.2 million, or $0.13 per diluted share, for the quarter ended December 31, 2023. For the twelve months ended December 31, 2024, the Company reported net income of $1.1 million, or $0.12 per diluted share, compared to net income of $6.3 million, or $0.69 per diluted share, for the year ended December 31, 2023.

The improved performance in the current quarter compared to the quarter ended September 30, 2024, was due primarily to a $1.3 million recapture of provision for credit losses. This compares to a provision for credit losses of $1.6 million in the prior quarter that mainly related to two participation loans to a single borrowing entity totaling approximately $6.0 million, where we were not the lead lender. During the quarter ended December 31, 2024, one of the two loans was paid in full and the borrower paid down the balance on the other loan using proceeds from the sale of another property. Subsequently, we received an updated appraisal of the property securing the remaining loan that confirmed a value sufficient to support the recapture of the previously allocated specific reserve for this loan.

“I am pleased to report that our net loans receivable increased $14.0 million in the quarter as our lending teams continue to focus on growing our loan portfolio. In addition, our credit quality remained strong, with only $842,000 in nonaccrual loans, representing 0.07% of our $1.16 billion total loan portfolio,” stated Joseph W. Kiley III, President and CEO.

“We continue to prepare for the closing of the sale of the Bank to Global Federal Credit Union (“Global”), as we await the final required approval from Global’s primary regulator, the National Credit Union Administration, before we can proceed towards closing the transaction,” concluded Kiley.

Highlights for the quarter and year ended December 31, 2024:

Net loans receivable totaled $1.14 billion at December 31, 2024, compared to $1.13 billion at September 30, 2024, and $1.18 billion at December 31, 2023.
Book value per common share was $17.50 at December 31, 2024, compared to $17.39 at September 30, 2024, and $17.61 at December 31, 2023.
The Bank’s Tier 1 leverage and total capital ratios were 11.2% and 16.7% at December 31, 2024, compared to 10.9% and 16.7% at September 30, 2024, and 10.2% and 16.2% at December 31, 2023, respectively.
Credit quality remained strong with nonaccrual loans totaling $842,000, or 0.07% of total loans at December 31, 2024.
A $1.3 million recapture of provision for credit losses was recorded in the current quarter, compared to a $1.6 million and no provision for credit losses recorded during the prior quarter and the same quarter a year ago, respectively. We recorded a $50,000 recapture of provision for credit losses for the year ended December 31, 2024, compared to a $208,000 recapture of provision for credit losses for the year ended December 31, 2023.

Deposits decreased $36.0 million to $1.13 billion at December 31, 2024, compared to $1.17 billion at September 30, 2024, and decreased $62.7 million compared to $1.19 billion at December 31, 2023. The decrease in deposits at December 31, 2024, compared to September 30, 2024, was due primarily to a $19.7 million decrease in noninterest-bearing demand deposits and a $15.5 million decrease in money market deposits. The decrease in deposits at December 31, 2024, from December 31, 2023, reflects declines in all deposit categories except for retail certificates of deposit which increased $91.8 million.

Federal Home Loan Bank (“FHLB”) advances totaled $110.0 million at December 31, 2024, compared to $100.0 million at September 30, 2024, and $125.0 million at December 31, 2023. Of the total FHLB advances at December 31, 2024, $100.0 million were tied to cash flow hedge agreements under which the Bank pays a fixed rate and receives a variable rate in return to assist in the Bank’s interest rate risk management efforts. These cash flow hedge agreements had a weighted average remaining term of 27.8 months and a weighted average fixed interest rate of 1.93% as of December 31, 2024. The average cost of borrowings was 2.35% for the quarter ended December 31, 2024, compared to 3.19% for the quarter ended September 30, 2024, and 2.40% for the quarter ended December 31, 2023.

The following table presents a breakdown of our total deposits (unaudited):

	Dec 31, 2024		Sep 30, 2024		Dec 31, 2023		Three Month Change			One Year Change
Deposits:	(Dollars in thousands)
Noninterest-bearing demand	$	80,772	$	100,466	$	100,899	$	(19,694	)	$	(20,127	)
Interest-bearing demand		56,957		55,506		56,968		1,451			(11	)
Savings		16,277		17,031		18,886		(754	)		(2,609	)
Money market		480,520		495,978		529,411		(15,458	)		(48,891	)
Certificates of deposit, retail		448,974		447,474		357,153		1,500			91,821
Brokered deposits		47,900		50,900		130,790		(3,000	)		(82,890	)
Total deposits	$	1,131,400	$	1,167,355	$	1,194,107	$	(35,955	)	$	(62,707	)

The following tables present an analysis of total deposits by branch office (unaudited):

December 31, 2024
	Noninterest- bearing demand		Interest- bearing demand		Savings		Money market		Certificates of deposit, retail		Brokered deposits		Total
	(Dollars in thousands)
King County
Renton	$	26,242	$	14,786	$	10,197	$	284,670	$	309,858	$	–	$	645,753
Landing		3,245		1,359		170		7,958		14,965		–		27,697
Woodinville		1,738		3,168		620		8,834		11,511		–		25,871
Bothell		2,792		930		408		1,421		6,762		–		12,313
Crossroads		11,075		2,762		86		29,208		18,772		–		61,903
Kent		3,766		4,873		40		18,673		8,471		–		35,823
Kirkland		5,524		1,924		208		11,574		1,855		–		21,085
Issaquah		1,244		238		13		2,298		6,562		–		10,355
Total King County		55,626		30,040		11,742		364,636		378,756		–		840,800
Snohomish County
Mill Creek		3,184		3,496		342		16,135		12,487		–		35,644
Edmonds		7,316		8,542		338		16,482		13,003		–		45,681
Clearview		4,909		5,653		1,494		17,934		13,778		–		43,768
Lake Stevens		3,633		5,946		1,314		24,571		17,004		–		52,468
Smokey Point		2,544		1,800		1,032		36,950		9,619		–		51,945
Total Snohomish County		21,586		25,437		4,520		112,072		65,891		–		229,506
Pierce County
University Place		1,837		54		1		2,113		2,122		–		6,127
Gig Harbor		1,723		1,426		14		1,699		2,205		–		7,067
Total Pierce County		3,560		1,480		15		3,812		4,327		–		13,194

Brokered deposits		–		–		–		–		–		47,900		47,900

Total deposits	$	80,772	$	56,957	$	16,277	$	480,520	$	448,974	$	47,900	$	1,131,400

September 30, 2024
	Noninterest- bearing demand		Interest- bearing demand		Savings		Money market		Certificates of deposit, retail		Brokered deposits		Total
	(Dollars in thousands)
King County
Renton	$	29,388	$	14,153	$	10,654	$	305,836	$	315,721	$	–	$	675,752
Landing		3,442		1,660		237		8,348		12,733		–		26,420
Woodinville		1,968		2,234		959		8,852		11,522		–		25,535
Bothell		2,965		1,151		401		1,536		5,918		–		11,971
Crossroads		14,770		2,039		107		31,665		18,136		–		66,717
Kent		5,417		10,502		44		16,053		8,562		–		40,578
Kirkland		10,967		1,890		206		11,243		2,240		–		26,546
Issaquah		1,186		294		18		2,547		6,580		–		10,625
Total King County		70,103		33,923		12,626		386,080		381,412		–		884,144
Snohomish County
Mill Creek		3,990		2,171		384		14,628		10,312		–		31,485
Edmonds		9,254		6,831		330		18,549		13,281		–		48,245
Clearview		5,587		5,242		1,462		21,206		12,251		–		45,748
Lake Stevens		3,970		4,282		1,244		23,257		15,571		–		48,324
Smokey Point		2,994		1,664		969		29,353		11,387		–		46,367
Total Snohomish County		25,795		20,190		4,389		106,993		62,802		–		220,169
Pierce County
University Place		2,940		53		4		1,848		1,458		–		6,303
Gig Harbor		1,628		1,340		12		1,057		1,802		–		5,839
Total Pierce County		4,568		1,393		16		2,905		3,260		–		12,142

Brokered deposits		–		–		–		–		–		50,900		50,900

Total deposits	$	100,466	$	55,506	$	17,031	$	495,978	$	447,474	$	50,900	$	1,167,355

Net loans receivable totaled $1.14 billion at December 31, 2024, compared to $1.13 billion at September 30, 2024, and $1.18 billion at December 31, 2023. The increase in the current quarter compared to the quarter ended September 30, 2024, was due to growth in non-residential commercial real estate, construction/land, consumer and one-to-four family residential loans, partially offset by declines in multifamily and business lending. The average balance of net loans receivable totaled $1.13 billion for both the quarters ended December 31, 2024, and September 30, 2024, compared to $1.17 billion for the quarter ended December 31, 2023. For the year ended December 31, 2024, the average balance of net loans receivable was $1.14 billion, compared to $1.17 billion for the year ended December 31, 2023.

The allowance for credit losses (“ACL”) represented 1.30% of total loans receivable at December 31, 2024, compared to 1.42% of total loans receivable at September 30, 2024, and 1.28% at December 31, 2023. The change in the ACL at December 31, 2024, compared to September 30, 2024, related primarily to activity on the single lending relationship discussed above.

Nonaccrual loans totaled $842,000 at December 31, 2024, compared to $853,000 at September 30, 2024, and $220,000 at December 31, 2023. There was no other real estate owned at December 31, 2024, September 30, 2024, or December 31, 2023.

Net interest income totaled $8.4 million for the quarter ended December 31, 2024, compared to $8.5 million for the quarter ended September 30, 2024, and $9.3 million for the quarter ended December 31, 2023. The decrease in the current quarter compared to the quarter ended September 30, 2024, was primarily due to declines in interest from earning assets, partially offset by declines in interest expense. For the year ended December 31, 2024, net interest income totaled $34.8 million, compared to $40.5 million for the year ended December 31, 2023, as total interest expense increased by $5.0 million and total interest income declined by $800,000.

Total interest income decreased $419,000 to $19.0 million for the quarter ended December 31, 2024, compared to $19.4 million for the quarter ended September 30, 2024, and decreased $1.3 million compared to $20.3 million for the quarter ended December 31, 2023. The decrease in total interest income during the current quarter compared to the prior quarter was primarily due to a $250,000 or 29.0% decline in interest income earned on interest-earning deposits held with banks. This decline resulted from a 54 basis point decrease in the average yield earned on these deposits, coupled with a $13.6 million reduction in their average balance. Additionally, interest income on loans, including fees, declined by $146,000 or 0.9%, primarily due to a $2.5 million decrease in the average balance of loans and, to a lesser extent, a four basis point decrease in the yield earned on loans. The decrease in total interest income during the current quarter compared to the comparable quarter in 2023 was primarily due to declines in interest income on loans, including fees, of $631,000, investments of $449,000, and interest-earning deposits with banks of $267,000, partially offset by an increase in dividends on FHLB stock of $56,000.

Yield on loans, the largest component of our interest-earning assets, declined to 5.82% during the recent quarter, compared to 5.86% and 5.83% for the quarters ended September 30, 2024, and December 31, 2023, respectively. The yield on investment securities for the current quarter was 4.29%, down slightly from 4.30% last quarter and up from 4.11% a year ago.

Total interest expense was $10.6 million for the quarter ended December 31, 2024, down from $11.0 million for both quarters ended September 30, 2024, and December 31, 2023. The decrease from the quarter ended September 30, 2024, was due to lower interest expense related to FHLB advances and other borrowings, which declined due to a decline in the average balance of FHLB advances and other borrowings, partially offset by higher interest expense on deposits driven by an increase in the average balance of interest-bearing deposits. The decrease from the quarter ended December 31, 2023, was due to lower interest expense on deposits and FHLB advances and other borrowings, primarily as a result of lower average balances of these liabilities.

Net interest margin was 2.50% for the quarter ended December 31, 2024, compared to 2.46% for the quarter ended September 30, 2024, and 2.54% for the quarter ended December 31, 2023. The increase in the net interest margin for the quarter ended December 31, 2024, compared to the prior quarter was primarily due to a decline in the average balance of total interest-earning assets, as net interest income was relatively unchanged during the periods. The decrease in the net interest margin for the quarter ended December 31, 2024, compared to the same quarter a year ago was primarily due to a decline in net interest income, which was partially offset by a decline in the average balance of total interest-earning assets. The net interest margin for the month of December 2024 was 2.55%.

Noninterest income for the quarter ended December 31, 2024, totaled $658,000, down from $677,000 for the quarter ended September 30, 2024, and up from $633,000 for the quarter ended December 31, 2023. The decrease compared to the quarter ended September 30, 2024, was primarily due to lower loan and deposit related fees and BOLI income, partially offset by an increase in wealth management revenue. Noninterest income remained nearly flat at $2.8 million for both the years ended December 31, 2024, and December 31, 2023, as increases in BOLI income, wealth management revenue and loan related fees in the current year were nearly entirely offset by decreases in deposit related fees and other noninterest income.

Noninterest expense totaled $8.9 million for the quarter ended December 31, 2024, compared to $8.5 million for the quarter ended September 30, 2024, and $8.4 million for the quarter ended December 31, 2023. The increase from the quarter ended September 30, 2024, was primarily due to a $860,000 increase in salaries and employee benefits due to 2025 merit increases implemented in December 2024, as well as year-end accruals related to incentive compensation, partially offset by decreases in nearly all other categories, most notably professional fees and other general and administrative expenses. Incentive compensation increased due to the project that modified certain loans that would have otherwise been ineligible for Global Federal Credit Union to hold on their balance sheet. The increase compared to the quarter ended December 31, 2023, was primarily due to a $644,000 increase in salaries and employee benefits and an $87,000 increase in data processing expenses, partially offset by decreases across other expense categories. Noninterest expense totaled $36.7 million for the year ended December 31, 2024, compared to $35.7 million for the year ended December 31, 2023. The year-over-year increase was primarily due to an increase in professional fees, data processing and salaries and employee benefits, partially offset by lower marketing and other general and administrative expenses and regulatory assessments.

First Financial Northwest, Inc. is the parent company of First Financial Northwest Bank; an FDIC insured Washington State-chartered commercial bank headquartered in Renton, Washington, serving the Puget Sound Region through 15 full-service banking offices. For additional information about us, please visit our website at ffnwb.com and click on the “Investor Relations” link at the bottom of the page.

Forward-looking statements:

When used in this press release and in other documents filed with or furnished to the Securities and Exchange Commission (the “SEC”), in press releases or other public stockholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases “believe,” “will,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts but instead represent management’s current expectations and forecasts regarding future events many of which are inherently uncertain and outside of our control. Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, assumptions and statements about, among other things, our pending transaction with Global Federal Credit Union (“Global”) whereby Global, pursuant to the definitive purchase and assumption agreement (the “P&A Agreement”), will acquire substantially all of the assets and assume substantially all of the liabilities of the Bank, expectations of the business environment in which we operate, projections of future performance or financial items, perceived opportunities in the market, potential future credit experience, and statements regarding our mission and vision. These forward-looking statements are based on current management expectations and may, therefore, involve risks and uncertainties. Actual results may differ, possibly materially from those currently expected or projected in these forward-looking statements made by, or on behalf of, us and could negatively affect our operating and stock performance. Factors that could cause our actual results to differ materially from those described in the forward-looking statements, include, but are not limited to, the following: the occurrence of any event, change or other circumstances that could give rise to the right of one or all of the parties to terminate the P&A Agreement; delays in completing the P&A Agreement; the failure to obtain necessary regulatory approvals or to satisfy any of the other conditions to the Global transaction, including the P&A Agreement, on a timely basis or at all; delays or other circumstances arising from the dissolution of the Bank and the Company following completion of the P&A Agreement; diversion of management’s attention from ongoing business operations and opportunities during the pending Global transaction; potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement of the Global transaction; adverse impacts to economic conditions in our local market areas, other markets where the Company has lending relationships, or other aspects of the Company’s business operations or financial markets, including, without limitation, as a result of employment levels, labor shortages and the effects of inflation, a recession or slowed economic growth; changes in the interest rate environment, including increases or decreases in the Federal Reserve benchmark rate and duration at which such interest rate levels are maintained, which could adversely affect our revenues and expenses, the value of assets and obligations, and the availability and cost of capital and liquidity; the impact of inflation and the current and future monetary policies of the Federal Reserve in response thereto; the effects of any federal government shutdown; increased competitive pressures, including repricing and competitors’ pricing initiatives, and their impact on our market position, loan, and deposit products; legislative and regulatory changes; the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment; disruptions, security breaches, or other adverse events, failures or interruptions in, or attacks on, our information technology systems or on the third-party vendors who perform several of our critical processing functions; effects of critical accounting policies and judgments, including the use of estimates in determining the fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation; the potential effects of new tariffs or changes to existing trade policies that could affect economic activity or specific industry sectors; the effects of climate change, severe weather events, natural disasters, pandemics, epidemics and other public health crises, acts of war or terrorism, civil unrest and other external events on our business; and other factors described in the Company’s latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other reports filed with or furnished to the Securities and Exchange Commission – that are available on our website at www.ffnwb.com and on the SEC’s website at www.sec.gov.

Any of the forward-looking statements that we make in this Press Release and in the other public statements are based upon management’s beliefs and assumptions at the time they are made and may turn out to be wrong because of the inaccurate assumptions we might make, because of the factors illustrated above or because of other factors that we cannot foresee. Therefore, these factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES Consolidated Balance Sheets (Dollars in thousands) (Unaudited)
Assets	Dec 31, 2024			Sep 30, 2024			Dec 31, 2023			Three Month Change		One Year Change

Cash on hand and in banks	$	9,535		$	8,423		$	8,391		13.2	%	13.6	%
Interest-earning deposits with banks		36,182			72,884			22,138		(50.4	)	63.4
Investments available-for-sale, at fair value		151,642			156,609			207,915		(3.2	)	(27.1	)
Investments held-to-maturity, at amortized cost		2,468			2,462			2,456		0.2		0.5
Loans receivable, net of allowance of $15,066, $16,265 and $15,306, respectively		1,140,186			1,126,146			1,175,925		1.2		(3.0	)
Federal Home Loan Bank (“FHLB”) stock, at cost		5,853			5,403			6,527		8.3		(10.3	)
Accrued interest receivable		6,108			6,638			7,359		(8.0	)	(17.0	)
Deferred tax assets, net		2,582			2,690			2,648		(4.0	)	(2.5	)
Premises and equipment, net		18,166			18,584			19,667		(2.2	)	(7.6	)
Bank owned life insurance (“BOLI”), net		38,950			38,661			37,653		0.7		3.4
Prepaid expenses and other assets		9,676			8,898			10,478		8.7		(7.7	)
Right of use asset (“ROU”), net		2,357			2,473			2,617		(4.7	)	(9.9	)
Goodwill		889			889			889		0.0		0.0
Core deposit intangible, net		295			326			419		(9.5	)	(29.6	)
Total assets	$	1,424,889		$	1,451,086		$	1,505,082		(1.8	)	(5.3	)

Liabilities and Stockholders’ Equity

Deposits
Noninterest-bearing deposits	$	80,772		$	100,466		$	100,899		(19.6	)	(19.9	)
Interest-bearing deposits		1,050,628			1,066,889			1,093,208		(1.5	)	(3.9	)
Total deposits		1,131,400			1,167,355			1,194,107		(3.1	)	(5.3	)
FHLB advances		110,000			100,000			125,000		10.0		(12.0	)
Advance payments from borrowers for taxes and insurance		2,873			5,211			2,952		(44.9	)	(2.7	)
Lease liability, net		2,550			2,673			2,806		(4.6	)	(9.1	)
Accrued interest payable		526			294			2,739		78.9		(80.8	)
Other liabilities		15,985			15,340			15,818		4.2		1.1
Total liabilities		1,263,334			1,290,873			1,343,422		(2.1	)	(6.0	)

Commitments and contingencies

Stockholders’ Equity
Preferred stock, $0.01 par value; authorized 10,000,000 shares; no shares issued or outstanding		–			–			–		n/a		n/a
Common stock, $0.01 par value; authorized 90,000,000 shares; issued and outstanding 9,230,010 shares at December 31, 2024, 9,213,969 shares at September 30, 2024, and 9,179,510 shares at December 31, 2023		93			92			92		1.1		1.1
Additional paid-in capital		72,823			72,916			73,035		(0.1	)	(0.3	)
Retained earnings		94,892			93,692			96,206		1.3		(1.4	)
Accumulated other comprehensive loss, net of tax		(6,253	)		(6,487	)		(7,673	)	(3.6	)	(18.5	)
Total stockholders’ equity		161,555			160,213			161,660		0.8		(0.1	)
Total liabilities and stockholders’ equity	$	1,424,889		$	1,451,086		$	1,505,082		(1.8	)%	(5.3	)%

FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES Consolidated Income Statements (Dollars in thousands, except per share data) (Unaudited)
	Quarter Ended
	Dec 31, 2024			Sep 30, 2024			Dec 31, 2023		Three Month Change		One Year Change
Interest income
Loans, including fees	$	16,512		$	16,658		$	17,143	(0.9	)%	(3.7	)%
Investments		1,694			1,744			2,143	(2.9	)	(21.0	)
Interest-earning deposits with banks		613			863			880	(29.0	)	(30.3	)
Dividends on FHLB Stock		177			150			121	18.0		46.3
Total interest income		18,996			19,415			20,287	(2.2	)	(6.4	)
Interest expense
Deposits		9,956			9,748			10,281	2.1		(3.2	)
FHLB advances and other borrowings		600			1,213			731	(50.5	)	(17.9	)
Total interest expense		10,556			10,961			11,012	(3.7	)	(4.1	)
Net interest income		8,440			8,454			9,275	(0.2	)	(9.0	)
(Recapture of provision) provision for credit losses		(1,250	)		1,575			–	(179.4	)	n/a
Net interest income after (recapture of provision) provision for credit losses		9,690			6,879			9,275	40.9		4.5

Noninterest income
BOLI income		289			295			255	(2.0	)	13.3
Wealth management revenue		88			42			60	109.5		46.7
Deposit related fees		226			236			234	(4.2	)	(3.4	)
Loan related fees		44			96			60	(54.2	)	(26.7	)
Other		11			8			24	37.5		(54.2	)
Total noninterest income		658			677			633	(2.8	)	3.9

Noninterest expense
Salaries and employee benefits		5,466			4,606			4,822	18.7		13.4
Occupancy and equipment		1,154			1,183			1,231	(2.5	)	(6.3	)
Professional fees		377			585			431	(35.6	)	(12.5	)
Data processing		805			838			718	(3.9	)	12.1
Regulatory assessments		160			165			196	(3.0	)	(18.4	)
Insurance and bond premiums		114			113			113	0.9		0.9
Marketing		24			46			70	(47.8	)	(65.7	)
Other general and administrative		834			952			858	(12.4	)	(2.8	)
Total noninterest expense		8,934			8,488			8,439	5.3		5.9
Income before federal income tax provision (benefit)		1,414			(932	)		1,469	(251.7	)	(3.7	)
Federal income tax provision (benefit)		214			(324	)		275	(166.0	)	(22.2	)
Net income (loss)	$	1,200		$	(608	)	$	1,194	(297.4	)%	0.5	%

Basic earnings (loss) per share	$	0.13		$	(0.07	)	$	0.13
Diluted earnings (loss) per share	$	0.13		$	(0.07	)	$	0.13
Weighted average number of common shares outstanding		9,220,593			9,190,146			9,151,892
Weighted average number of diluted shares outstanding		9,238,565			9,190,146			9,176,724

FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES Consolidated Income Statements (Dollars in thousands, except per share data) (Unaudited)
	Year Ended December 31,
		2024			2023		One Year Change
Interest income
Loans, including fees	$	66,941		$	66,938		0.0	%
Investments		7,388			8,474		(12.8	)
Interest-earning deposits with banks		2,444			2,261		8.1
Dividends on FHLB Stock		597			485		23.1
Total interest income		77,370			78,158		(1.0	)
Interest expense
Deposits		39,117			34,407		13.7
FHLB advances and other borrowings		3,490			3,208		8.8
Total interest expense		42,607			37,615		13.3
Net interest income		34,763			40,543		(14.3	)
Recapture of provision for credit losses		(50	)		(208	)	(76.0	)
Net interest income after recapture of provision for credit losses		34,813			40,751		(14.6	)

Noninterest income
BOLI		1,245			1,081		15.2
Wealth management revenue		279			253		10.3
Deposit accounts related fees		923			956		(3.5	)
Loan related fees		296			275		7.6
Other		53			208		(74.5	)
Total noninterest income		2,796			2,773		0.8

Noninterest expense
Salaries and employee benefits		20,652			20,366		1.4
Occupancy and equipment		4,789			4,748		0.9
Professional fees		3,011			2,288		31.6
Data processing		3,285			2,857		15.0
Regulatory assessments		662			763		(13.2	)
Insurance and bond premiums		477			468		1.9
Marketing		179			343		(47.8	)
Other general and administrative		3,638			3,833		(5.1	)
Total noninterest expense		36,693			35,666		2.9
Income before federal income tax (benefit) provision		916			7,858		(88.3	)
Federal income tax (benefit) provision		(156	)		1,553		(110.0	)
Net income	$	1,072		$	6,305		(83.0	)%

Basic earnings per share	$	0.12		$	0.69
Diluted earnings per share	$	0.12		$	0.69
Weighted average number of common shares outstanding		9,183,900			9,126,209
Weighted average number of diluted shares outstanding		9,238,016			9,152,617

The following table presents a breakdown of the loan portfolio (unaudited):

	December 31, 2024					September 30, 2024					December 31, 2023
	Amount			Percent		Amount			Percent		Amount			Percent
	(Dollars in thousands)
Commercial real estate:
Residential:
Multifamily	$	126,303		10.9	%	$	132,811		11.6	%	$	138,149		11.6	%
Total multifamily residential		126,303		10.9			132,811		11.6			138,149		11.6

Non-residential:
Retail		110,787		9.6			118,840		10.4			124,172		10.4
Office		73,306		6.3			73,778		6.5			72,778		6.1
Hotel / motel		72,434		6.3			54,716		4.8			63,597		5.3
Storage		32,229		2.8			32,443		2.8			33,033		2.8
Mobile home park		22,701		2.0			22,443		2.0			21,701		1.8
Warehouse		23,363		2.0			18,743		1.6			19,218		1.6
Nursing Home		9,713		0.8			11,407		1.0			11,610		1.0
Other non-residential		29,865		2.5			30,719		2.7			31,750		2.6
Total non-residential		374,398		32.3			363,089		31.8			377,859		31.6

Construction/land:
One-to-four family residential		49,674		4.3			42,846		3.8			47,149		4.0
Multifamily		7,884		0.7			7,227		0.6			4,004		0.3
Land development		9,582		0.8			10,148		0.8			9,771		0.8
Total construction/land		67,140		5.8			60,221		5.2			60,924		5.1

One-to-four family residential:
Permanent owner occupied		284,650		24.7			279,744		24.5			284,471		23.9
Permanent non-owner occupied		217,420		18.8			221,127		19.4			228,752		19.2
Total one-to-four family residential		502,070		43.5			500,871		43.9			513,223		43.1

Business
Aircraft		–		0.0			–		0.0			1,945		0.1
Small Business Administration (“SBA”)		1,729		0.2			1,745		0.2			1,794		0.3
Paycheck Protection Plan (“PPP”)		159		0.0			238		0.0			473		0.0
Other business		10,247		0.9			12,416		1.1			24,869		2.1
Total business		12,135		1.1			14,399		1.3			29,081		2.5

Consumer
Classic, collectible and other auto		59,580		5.2			58,085		5.1			58,618		5.0
Other consumer		13,626		1.2			12,935		1.1			13,377		1.1
Total consumer		73,206		6.4			71,020		6.2			71,995		6.1
Total loans		1,155,252		100.0	%		1,142,411		100.0	%		1,191,231		100.0	%
Less:
ACL		15,066					16,265					15,306
Loans receivable, net	$	1,140,186				$	1,126,146				$	1,175,925

Concentrations of credit: ⁽¹⁾
Construction loans as % of total capital		40.5	%				36.8	%				38.3	%
Total non-owner occupied commercial real estate as % of total capital		300.8	%				296.2	%				316.8	%

⁽¹⁾ Concentrations of credit percentages are for First Financial Northwest Bank only using classifications in accordance with FDIC regulatory guidelines.

FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES Key Financial Measures (Unaudited)
	At or For the Quarter Ended
	Dec 31,			Sep 30,			Jun 30,			Mar 31,			Dec 31,
		2024			2024			2024			2024			2023
	(Dollars in thousands, except per share data)
Performance Ratios: ⁽¹⁾
Return on assets		0.33	%		(0.17	)%		0.43	%		(0.29	)%		0.31	%
Return on equity		2.96			(1.50	)		3.88			(2.67	)		2.97
Dividend payout ratio		0.00			0.00			76.47			(108.33	)		100.00
Equity-to-assets ratio		11.34			11.04			11.10			10.91			10.74
Tangible equity ratio ⁽²⁾		11.26			10.97			11.02			10.83			10.66
Net interest margin		2.50			2.46			2.66			2.55			2.54
Average interest-earning assets to average interest-bearing liabilities		116.51			116.46			117.01			116.40			115.84
Efficiency ratio		98.20			92.96			82.35			116.97			85.17
Noninterest expense as a percent of average total assets		2.49			2.32			2.21			3.05			2.18
Book value per common share	$	17.50		$	17.39		$	17.51		$	17.46		$	17.61
Tangible book value per share ⁽²⁾		17.37			17.26			17.37			17.32			17.47

Capital Ratios: ⁽³⁾
Tier 1 leverage ratio		11.16	%		10.86	%		10.91	%		10.41	%		10.18	%
Common equity tier 1 capital ratio		15.40			15.43			15.39			14.98			14.90
Tier 1 capital ratio		15.40			15.43			15.39			14.98			14.90
Total capital ratio		16.65			16.68			16.64			16.24			16.15

Asset Quality Ratios: ⁽⁴⁾
Nonaccrual loans as a percent of total loans		0.07	%		0.07	%		0.41	%		0.02	%		0.02	%
Nonaccrual loans as a percent of total assets		0.06			0.06			0.32			0.01			0.01
ACL as a percent of total loans		1.30			1.42			1.29			1.30			1.28
Net charge-offs to average loans receivable, net		(0.00	)		0.00			0.00			0.00			0.00

Allowance for Credit Losses:
ACL – loans
Beginning balance	$	16,265		$	14,796		$	14,996		$	15,306		$	15,306
(Recapture of provision) provision for credit losses		(1,200	)		1,500			(200	)		(300	)		–
Charge-offs		–			(31	)		–			(10	)		–
Recoveries		1			–			–			–			–
Ending balance	$	15,066		$	16,265		$	14,796		$	14,996		$	15,306

Allowance for unfunded commitments
Beginning balance	$	639		$	564		$	564		$	439		$	439
(Recapture of provision) provision for credit losses		(50	)		75			–			125			–
Ending balance	$	589		$	639		$	564		$	564		$	439

(Recapture of provision) provision for credit losses
ACL – loans	$	(1,200	)	$	1,500		$	(200	)	$	(300	)	$	–
Allowance for unfunded commitments		(50	)		75			–			125			–
Total	$	(1,250	)	$	1,575		$	(200	)	$	(175	)	$	–

⁽¹⁾ Performance ratios are calculated on an annualized basis.
⁽²⁾ Non-GAAP financial measures. Refer to Non-GAAP Financial Measures at the end of this press release for a reconciliation to the nearest GAAP equivalents.
⁽³⁾ Capital ratios are for First Financial Northwest Bank only.
⁽⁴⁾ Loans are reported net of undisbursed funds.

FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES Key Financial Measures (Unaudited)
	At or For the Quarter Ended
	Dec 31,			Sep 30,			Jun 30,			Mar 31,			Dec 31,
		2024			2024			2024			2024			2023
	(Dollars in thousands)
Yields and Costs: ⁽¹⁾
Yield on loans		5.82	%		5.86	%		5.93	%		5.88	%		5.83	%
Yield on investments		4.29			4.30			4.38			4.11			4.11
Yield on interest-earning deposits		4.73			5.27			5.25			5.28			5.32
Yield on FHLB stock		12.87			7.73			8.63			7.79			7.29
Yield on interest-earning assets		5.63	%		5.66	%		5.73	%		5.62	%		5.56	%

Cost of interest-bearing deposits		3.77	%		3.80	%		3.71	%		3.69	%		3.62	%
Cost of borrowings		2.35			3.19			2.64			2.65			2.40
Cost of interest-bearing liabilities		3.64	%		3.72	%		3.59	%		3.58	%		3.50	%

Cost of total deposits ⁽²⁾		3.46	%		3.47	%		3.38	%		3.38	%		3.31	%
Cost of funds ⁽²⁾		3.37			3.44			3.30			3.31			3.23

Average Balances:
Loans	$	1,129,019		$	1,131,473		$	1,139,017		$	1,160,156		$	1,167,339
Investments		156,975			161,232			173,102			202,106			206,837
Interest-earning deposits		51,518			65,149			36,959			37,032			65,680
FHLB stock		5,471			7,719			6,714			6,554			6,584
Total interest-earning assets	$	1,342,983		$	1,365,573		$	1,355,792		$	1,405,848		$	1,446,440

Interest-bearing deposits	$	1,051,201		$	1,021,041		$	1,029,608		$	1,082,168		$	1,127,690
Borrowings		101,522			151,478			129,126			125,604			120,978
Total interest-bearing liabilities		1,152,723			1,172,519			1,158,734			1,207,772			1,248,668
Noninterest-bearing deposits		93,331			96,003			101,196			99,173			102,869
Total deposits and borrowings	$	1,246,054		$	1,268,522		$	1,259,930		$	1,306,945		$	1,351,537

Average assets	$	1,429,788		$	1,453,431		$	1,446,207		$	1,495,753		$	1,538,955
Average stockholders’ equity		161,093			161,569			161,057			161,823			159,659

⁽¹⁾ Yields and costs are annualized.
⁽²⁾ Includes noninterest-bearing deposits.
⁽³⁾ Includes total borrowings and deposits (including noninterest-bearing deposits).

FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES Key Financial Measures (Unaudited)
	At or For the Year Ended December 31,
		2024			2023			2022			2021			2020
				(Dollars in thousands, except per share data)
Performance Ratios:
Return on assets		0.07	%		0.41	%		0.91	%		0.86	%		0.63	%
Return on equity		0.66			3.93			8.34			7.65			5.50
Dividend payout ratio		216.67			75.36			32.65			33.59			45.45
Equity-to-assets ratio		11.34			10.74			10.67			11.07			11.26
Tangible equity ratio ⁽¹⁾		11.26			10.66			10.58			10.97			11.15
Net interest margin		2.54			2.82			3.54			3.35			3.15
Average interest-earning assets to average interest-bearing liabilities		116.59			116.69			119.18			118.59			115.62
Efficiency ratio		97.69			82.34			69.04			68.32			72.39
Noninterest expense as a percent of average total assets		2.52			2.33			2.44			2.35			2.39
Book value per common share	$	17.50		$	17.61		$	17.57		$	17.30		$	16.05
Tangible book value per share ⁽¹⁾		17.37			17.47			17.41			17.13			15.88

Capital Ratios: ⁽²⁾
Tier 1 leverage ratio		11.16	%		10.18	%		10.31	%		10.34	%		10.29	%
Common equity tier 1 capital ratio		15.40			14.90			14.37			14.23			14.32
Tier 1 capital ratio		15.40			14.90			14.37			14.23			14.32
Total capital ratio		16.65			16.15			15.62			15.48			15.57

Asset Quality Ratios: ⁽³⁾
Nonaccrual loans as a percent of total loans		0.07	%		0.02	%		0.02	%		0.00	%		0.19	%
Nonaccrual loans as a percent of total assets		0.06			0.01			0.01			0.00			0.18
ACL as a percent of total loans		1.30			1.28			1.29			1.40			1.36
Net charge-offs (recoveries) to average loans receivable, net		0.00			0.00			0.00			(0.02	)		(0.00	)

ACL – loans
Beginning balance	$	15,306		$	15,227		$	15,657		$	15,174		$	13,218
Beginning balance adjustment from adoption of Topic 326		–			500			–			–			–
(Recapture of provision) provision for credit losses		(200	)		(400	)		(400	)		300			1,900
Charge-offs		(41	)		(22	)		(37	)		–			(2	)
Recoveries		1			1			7			183			58
Ending balance	$	15,066		$	15,306		$	15,227		$	15,657		$	15,174

Allowance for unfunded commitments
Beginning balance	$	439		$	247		$	281		$	351		$	428
Provision (recapture of provision) for credit losses		150			192			(34	)		(70	)		(77	)
Ending balance	$	589		$	439		$	247		$	281		$	351

(Recapture of provision) provision for credit losses
ACL – loans	$	(200	)	$	(400	)	$	(400	)	$	300		$	1,900
Allowance for unfunded commitments		150			192			(34	)		(70	)		(77	)
Total	$	(50	)	$	(208	)	$	(434	)	$	230		$	1,823

⁽¹⁾ Non-GAAP financial measures. Refer to Non-GAAP Financial Measures at the end of this press release for a reconciliation to the nearest GAAP equivalents.
⁽²⁾ Capital ratios are for First Financial Northwest Bank only.
⁽³⁾ Loans are reported net of undisbursed funds.

FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES Key Financial Measures (Unaudited)
	At or For the Year Ended December 31,
		2024			2023			2022			2021			2020
	(Dollars in thousands)
Yields and Costs:
Yield on loans		5.87	%		5.71	%		4.69	%		4.57	%		4.69	%
Yield on investments		4.26			3.97			2.77			1.83			2.39
Yield on interest-earning deposits		5.12			5.06			1.28			0.12			0.21
Yield on FHLB stock		9.03			7.07			5.08			5.29			4.85
Yield on interest-earning assets		5.66	%		5.44	%		4.33	%		4.01	%		4.36	%

Cost of deposits		3.74	%		3.12	%		0.87	%		0.71	%		1.42	%
Cost of borrowings		2.75			2.52			1.70			1.39			1.31
Cost of interest-bearing liabilities		3.63	%		3.05	%		0.95	%		0.78	%		1.41	%

Cost of interest-bearing deposits		3.42	%		2.83	%		0.77	%		0.64	%		1.32	%
Cost of funds		3.35			2.80			0.86			0.71			1.32

Average Balances:
Loans	$	1,139,864		$	1,172,569		$	1,128,835		$	1,098,772		$	1,120,889
Investments		173,276			213,261			203,165			176,110			133,584
Interest-earning deposits		47,723			44,684			30,176			60,482			25,108
FHLB stock		6,614			6,857			6,256			6,271			6,600
Total interest-earning assets	$	1,367,477		$	1,437,371		$	1,368,432		$	1,341,635		$	1,286,181

Interest-bearing deposits	$	1,045,950		$	1,104,510		$	1,034,351		$	1,015,852		$	987,069
Borrowings		126,931			127,263			113,890			115,466			125,392
Total interest-bearing liabilities		1,172,881			1,231,773			1,148,241			1,131,318			1,112,461
Noninterest-bearing deposits		97,411			109,795			125,166			112,484			75,388
Total deposits and borrowings	$	1,270,292		$	1,341,568		$	1,273,407		$	1,243,802		$	1,187,849

Average assets	$	1,456,215		$	1,529,511		$	1,455,739		$	1,421,476		$	1,361,604
Average stockholders’ equity		161,385			160,428			158,685			160,041			155,587

Non-GAAP Financial Measures

In addition to financial results presented in accordance with generally accepted accounting principles (“GAAP”) utilized in the United States, this earnings release contains non-GAAP financial measures that include tangible equity, tangible assets, tangible book value per share, and the tangible equity-to-assets ratio. The Company believes that these non-GAAP financial measures and ratios as presented are useful for both investors and management to understand the effects of goodwill and core deposit intangible, net and provides an alternative view of the Company’s performance over time and in comparison to the Company’s competitors. Non-GAAP financial measures have limitations, are not required to be uniformly applied and are not audited. They should not be considered in isolation and are not a substitute for other measures in this earnings release that are presented in accordance with GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

The following tables provide a reconciliation between the GAAP and non-GAAP measures:

	Quarter Ended
		Dec 31, 2024			Sep 30, 2024			Jun 30, 2024			Mar 31, 2024			Dec 31, 2023
	(Dollars in thousands, except per share data)
Tangible equity to tangible assets and tangible book value per share:
Total stockholders’ equity (GAAP)	$	161,555		$	160,213		$	160,693		$	160,183		$	161,660
Less:
Goodwill		889			889			889			889			889
Core deposit intangible, net		295			326			357			388			419
Tangible equity (Non-GAAP)	$	160,371		$	158,998		$	159,447		$	158,906		$	160,352

Total assets (GAAP)	$	1,424,889		$	1,451,086		$	1,447,753		$	1,468,350		$	1,505,082
Less:
Goodwill		889			889			889			889			889
Core deposit intangible, net		295			326			357			388			419
Tangible assets (Non-GAAP)	$	1,423,705		$	1,449,871		$	1,446,507		$	1,467,073		$	1,503,774

Common shares outstanding at period end		9,230,010			9,213,969			9,179,825			9,174,425			9,179,510

Equity-to-assets ratio (GAAP)		11.34	%		11.04	%		11.10	%		10.91	%		10.74	%
Tangible equity-to-tangible assets ratio (Non-GAAP)		11.26			10.97			11.02			10.83			10.66
Book value per common share (GAAP)	$	17.50		$	17.39		$	17.51		$	17.46		$	17.61
Tangible book value per share (Non-GAAP)		17.37			17.26			17.37			17.32			17.47

Non-GAAP Financial Measures (continued)

	Year Ended December 31,
		2024			2023			2022			2021			2020
	(Dollars in thousands, except per share data)
Tangible equity to tangible assets and tangible book value per share:
Total stockholders’ equity (GAAP)	$	161,555		$	161,660		$	160,360		$	157,879		$	156,302
Less:
Goodwill		889			889			889			889			889
Core deposit intangible		295			419			548			684			824
Tangible equity (Non-GAAP)	$	160,371		$	160,352		$	158,923		$	156,306		$	154,589

Total assets (GAAP)		1,424,889			1,505,082			1,502,916			1,426,329			1,387,669
Less:
Goodwill		889			889			889			889			889
		295			419			548			684			824
Tangible assets (Non-GAAP)	$	1,423,705		$	1,503,774		$	1,501,479		$	1,424,756		$	1,385,956

Common shares outstanding at period end		9,230,010			9,179,510			9,127,595			9,125,759			9,736,875

Equity-to-assets ratio (GAAP)		11.34	%		10.74	%		10.67	%		11.07	%		11.26	%
Tangible equity ratio (Non-GAAP)		11.26			10.66			10.58			10.97			11.15
Book value per common share (GAAP)	$	17.50		$	17.61		$	17.57		$	17.30		$	16.05
Tangible book value per share (Non-GAAP)		17.37			17.47			17.41			17.13			15.88

For more information, contact:
Joseph W. Kiley III, President and Chief Executive Officer
Rich Jacobson, Executive Vice President and Chief Financial Officer
(425) 255-4400

The MIL Network –

January 29, 2025

MIL-OSI: Endeavor Bancorp Reports Net Income of $1.1 Million for the Fourth Quarter of 2024; Highlighted by Quarterly Net Interest Margin Expansion

Source: GlobeNewswire (MIL-OSI)

SAN DIEGO, Jan. 28, 2025 (GLOBE NEWSWIRE) — Endeavor Bancorp (OTCQX: EDVR) (the “Company,” or “Bancorp”), the holding company for Endeavor Bank (the “Bank”), today reported net income of $1.08 million, or $0.25 per diluted share, for the fourth quarter of 2024, compared to net income of $924,000, or $0.22 per diluted share, for the third quarter of 2024, and $852,000, or $0.20 per diluted share, for the fourth quarter of 2023. Pretax net income was $1.55 million in the fourth quarter compared to $1.32 million in the preceding quarter and $1.24 million in the fourth quarter of 2023. All financial results are unaudited.

Results for the fourth quarter of 2024 included a $374,000 provision for credit losses, compared to a $609,000 provision for credit losses in the third quarter of 2024, and a $181,000 provision for credit losses in the fourth quarter of 2023. Also noteworthy was the interest expense on borrowings in the past three quarters, with interest expense on borrowings of $493,000 for the third and fourth quarters of 2024, and $201,000 for the fourth quarter of 2023. The additional interest expense was associated with the recent subordinated debt issued late in the first quarter of 2024. Excluding taxes and loan loss provisions, the Company’s pretax, pre-provision net income was $1.93 million in the fourth quarter of 2024, which was unchanged compared to the preceding quarter and an increase compared to $1.41 million in the fourth quarter of 2023.

“Endeavor’s fourth quarter 2024 operating results were highlighted by strong net interest income generation and net interest margin expansion,” stated Julie Glance, CFO. “We had another year of double-digit loan and deposit growth, with net loans increasing 31.1% and deposits increasing 18.5%, compared to a year ago. In addition, our earning assets yield also increased, up 69 basis points in 2024 over 2023, which is contributing to net interest margin expansion. As we look to 2025, our primary focus is shifting to deposit gathering, with an emphasis on bringing in full client relationships to grow our core deposit base.”

“Our thoughts and prayers are with the people and communities impacted by the Southern California wildfires and straight-line winds. Our team is actively reviewing our records to determine if any clients may be affected by these tragic events,” said Dan Yates, CEO.

Income Statement
Strong fourth quarter earnings were driven by loan growth and earning asset rates. Total interest income on loans and bank deposits and investments was $10.8 million, an increase of $568,000 compared to the preceding quarter, while total interest expenses decreased $30,000 during the same timeframe. Net interest income was $6.5 million in the fourth quarter of 2024, which was an increase of $598,000, or 10.1% compared to the preceding quarter and a 29.8% increase compared to the fourth quarter of 2023.

“The 12 basis point increase in our net interest margin during the fourth quarter of 2024, compared to the prior quarter, was the result of strong loan growth and higher interest earning assets, in addition to improving funding costs,” said Yates.

Net interest margin (NIM) increased 12 basis points to 3.97% in the fourth quarter of 2024 compared to 3.85% in the third quarter of 2024 and increased 40 basis points compared to 3.57% in the fourth quarter of 2023. The yield on total earning assets remained strong, decreasing only seven basis points during the fourth quarter of 2024 to 6.54%, compared to 6.61% in the preceding quarter, and up from 6.00% in the fourth quarter of 2023. The cost of deposits decreased significantly to 2.76% in the fourth quarter, compared to 2.98% in the third quarter, and up from 2.62% in the fourth quarter of 2023

Non-Interest income decreased to $160,000 in the fourth quarter, compared to $217,000 in the third quarter of 2024, and increased compared to $138,000 in the fourth quarter 2023.

Non-Interest expenses increased $547,000, an increase of 13.0%, in the fourth quarter compared to the third quarter of 2024, and increased $1.0 million compared to the fourth quarter of 2023. “The increase in expenses during the fourth quarter of 2024 was primarily driven by growth-related investment in infrastructure, as well as some non-recurring expenses specific to the quarter. Also worth noting, non-interest expenses for the year were well within our budgeted operating plan,” said Glance.

The Company’s annualized return on average equity for the fourth quarter of 2024 was 9.35%, compared to 8.17% in the third quarter of 2024 and 7.99% in the fourth quarter of 2023. The annualized return on average assets for the fourth quarter of 2024 was 0.65% compared to 0.59% in the third quarter of 2024 and 0.60% in the fourth quarter of 2023.

Balance Sheet
Total assets increased $23.0 million, or 3.5%, during the fourth quarter of 2024 to $678.3 million at December 31, 2024, compared to $655.3 million at September 30, 2024, and increased $108.2 million, or 19.0%, compared to December 31, 2023. Balance sheet liquidity remains strong with cash balances of $80.5 million, which represents 11.9% of total assets as of December 31, 2024. The Company’s bond portfolio increased $5.7 million during the fourth quarter to $25.8 million as of December 31, 2024, representing only 3.8% of total assets. Total available borrowing capacity through the Federal Home Loan Bank and the Federal Reserve discount window exceeded $140.1 million as of quarter end.

“At a time where other banks are shrinking their balance sheet, we have remained focused on expanding. Loan growth and new loan originations remained strong during the fourth quarter of 2024, as we continue to seek out high quality lending opportunities in our markets,” said Steve Sefton, President. “In early 2024, we expanded our team and moved into the greater Los Angeles Metro and Inland Empire markets. While this expansion north is still in its early stages, we are already seeing positive momentum and is already contributing to operating results.”

Total loans outstanding increased $33.4 million, or 6.2%, during the fourth quarter of 2024 to $571.8 million at December 31, 2024, compared to $538.4 million three months earlier, and increased $135.6 million, or 31.1%, when compared to $436.3 million a year earlier. Total non-performing loans decreased to 0.46% of the total loan portfolio as of December 31, 2024, compared to 1.22% in the prior quarter. The decrease compared to the prior quarter was due to one borrower who had been in the renewal process whose loans were successfully renewed during the fourth quarter of 2024 and are now current. The Company had no net charge offs during the fourth quarter of 2024, or in the prior quarter.

Total deposits increased $23.4 million, or 4.1%, during the quarter to $601.2 million at December 31, 2024, compared to $577.8 million three months earlier, and increased $93.4 million, up 18.5% when compared to $577.8 million a year earlier. The loan to deposit ratio was 95.1% at December 31, 2024, compared to 93.2% at September 30, 2024, and 86.0% as of December 31, 2023.

As a result of its participation in a reciprocal deposit placement network, the Bank accepted “reciprocal” deposits from other institutions, enabling the Bank to offer customers FDIC insurance on accounts in excess of the typical $250,000 FDIC insurance limit. Although the reciprocal deposit accounts maintained through the network are core deposits seeking FDIC insurance, the FDIC rules indicate that reciprocal deposits aggregating over 20% of total liabilities are classified as deposits obtained by or through a deposit broker. The total reciprocal deposits reported as brokered deposits were $113.7 million at December 31, 2024, and $127.0 million as of September 30, 2024. To support the strong loan growth, the Company is utilizing a conservative amount of wholesale deposits. As of December 31, 2024, total wholesale deposits, excluding the reciprocal deposits, was $60.7 million, representing 10.1% of total deposits compared to $40.7 million as of September 30, 2024, or 7.0% of total deposits.

Shareholders’ equity was $46.0 million at December 31, 2024, compared to $45.3 million at September 30, 2024, and $42.5 million at December 31, 2023. Tangible book value per share increased to $13.17 at December 31, 2024, compared to $12.97 three months earlier and $12.48 a year earlier.

Capital
The Bank’s Tier 1 leverage ratio was 10.90% as of December 31, 2024, compared to 11.38% at September 30, 2024. The Tier 1 risk-based capital ratio was 10.71% as of December 31, 2024, compared to 10.95% on September 30, 2024, and the Total risk-based capital ratio was 11.92% compared to 12.13% three months earlier, all of which were well above regulatory minimums.

On March 5, the Company completed the issuance of $12.5 million in fixed-to-floating rate subordinated notes. The subordinated debt was structured such that it qualified as Tier 2 capital at the holding company with most of the new capital down streamed to the Bank as Tier 1 capital.

About Endeavor Bancorp
Endeavor Bancorp, the holding company for Endeavor Bank, is primarily owned and operated by Southern Californians for Southern California businesses and their owners. The bank’s focus is local: local decision-making, local board, local founders, local owners, and relationships with local clients in Southern California.

Headquartered in downtown San Diego in the Symphony Towers building, the Bank also operates a loan production and executive administration office in Carlsbad and a branch office in La Mesa. Endeavor Bank provides traditional business banking services across a broad spectrum of industries and specialties. Unique to the bank is its consultative banking approach that partners our business clients with Endeavor Bank’s senior management. Together, we build strategies and provide resources that solve problems, plan for the future, and help clients’ efforts to grow revenues and profits. Endeavor Bancorp trades on the OTCQX^® Best Market under the symbol “EDVR.” Visit www.endeavor.bank for more information.

EDVR Shareholders
With many of our shareholders transferring their EDVR shares to their brokerage companies, along with ongoing trading taking place, Bancorp may not have the most current shareholder contact information. If you are an EDVR shareholder and would like to receive information via a more timely method, please complete the Shareholder Communication Preference Form on our website: https://www.bankendeavor.com/investor-relations so we can keep you updated on EDVR news, and invite you to various shareholder networking events throughout the year.

Forward-Looking Statements
This press release includes “forward-looking statements,” as such term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on the current beliefs of the Company’s directors and executive officers (collectively, “Management”), as well as assumptions made by and information currently available to the Company’s Management. All statements regarding the Company’s business strategy and plans and objectives of Management of the Company for future operations, are forward-looking statements. When used in this press release, the words “anticipate,” “believe,” “estimate,” “expect” and “intend” and words or phrases of similar meaning, as they relate to the Company or the Company’s Management, are intended to identify forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from the Company’s expectations (“cautionary statements”) are loan losses, rapid and unanticipated deposit withdrawals, unavailability of sources of liquidity, additional regulatory requirements that may be imposed on community banks or banks generally, changes in interest rates, loss of key personnel, lower lending limits and capital than competitors, regulatory restrictions and oversight of the Company, the secure and effective implementation of technology, risks related to the local and national economy, the effect on customers, collateral value and property insurance markets of the recent wildfires in the Los Angeles metropolitan area and similar events in the future, changes in real estate values, the Company’s implementation of its business plans and management of growth, loan performance, interest rates, and regulatory matters, the effects of trade, monetary and fiscal policies, inflation, and changes in accounting policies and practices. Based upon changing conditions, if any one or more of these risks or uncertainties materialize, or if any underlying assumptions prove incorrect, actual results may vary materially from those described as anticipated, believed, estimated, expected, or intended. The Company does not intend to update these forward-looking statements.

SELECTED FINANCIAL DATA (In thousands of dollars, except for ratios and per share amounts) Unaudited

	Three Months Ended

	December 31, 2024			September 30, 2024			December 31, 2023
	(Consolidated)			(Consolidated)			(Consolidated)
SUMMARY OF OPERATIONS
Interest income	$	10,754		$	10,186		$	8,444
Interest expense		4,236			4,266			3,423
Net interest income		6,518			5,920			5,021
Provision for credit losses		374			609			181
Net interest income after loss provision		6,144			5,311			4,841
Non-interest income		160			217			138
Non-interest expense		4,752			4,205			3,738
Income before tax		1,552			1,323			1,241
Federal income tax expense		296			255			245
State income tax expense		171			143			143
Net income	$	1,084		$	924		$	852

Core pretax earnings*	$	1,926		$	1,932		$	1,413
*excludes taxes and provision for loan losses

PER COMMON SHARE DATA
Number of shares outstanding (000s)*		3,494			3,494			3,394
*Adjusted for May 2024 Stock Dividend
Earnings per share, basic	$	0.31		$	0.26		$	0.25
Earnings per share, diluted	$	0.25		$	0.22		$	0.20
Book Value per share	$	13.17		$	12.97		$	12.53

BALANCE SHEET DATA
Assets	$	678,332		$	655,305		$	570,176
Investments securities		25,777			20,107			7,877
Total loans, net of unearned income		571,817			538,439			436,263
Total deposits		601,219			577,781			507,557
Borrowings		26,697			26,672			16,121
Shareholders’ equity		46,009			45,308			42,526
Loan to Deposit ratio		95.11	%		93.19	%		85.95	%
Wholesale Deposits to Total Deposits		10.10	%		7.04	%

AVERAGE BALANCE SHEET DATA
Average assets	$	660,748		$	619,122			563,973
Average total loans, net of unearned income		549,340			506,469			424,435
Average total deposits		582,583			541,858		$	501,079
Average shareholders’ equity		46,117			44,990			42,344

ASSET QUALITY RATIOS
Net (charge-offs) recoveries	$	–		$	–			(800	)
Net (charge-offs) recoveries to average loans		0.00	%		0.00	%		0.20	%
Non-performing loans as a % of loans		0.46	%		1.22	%		0.07	%
Non-performing assets as a % of assets		0.38	%		1.00	%		0.05	%
Allowance for loan losses as a % of total loans		0.46	%		1.39	%		1.37	%
Allowance for loan losses as a % of non-performing loans		300.54	%		113.61	%		6.94	%

FINANCIAL RATIOSSTATISTICS
Annualized return on average equity		9.35	%		8.17	%		7.99	%
Annualized return on average assets		0.65	%		0.59	%		0.60	%
Net interest margin		3.97	%		3.85	%		3.57	%
Efficiency ratio		71.17	%		69.26	%		72.44	%

CAPITAL RATIOS
Tier 1 leverage ratio — Bank		10.90	%		11.38	%		10.14	%
Common equity tier 1 ratio — Bank		10.71	%		10.95	%		10.92	%
Tier 1 risk-based capital ratio — Bank		10.71	%		10.95	%		10.92	%
Total risk-based capital ratio –Bank		11.90	%		12.13	%		12.09	%

TCE/TA *		6.78	%		6.91	%		7.46	%
Tangible Book Value per Share	$	13.17		$	12.97			12.48	%

*Non-GAAP financial measure.
Unaudited financials 2024

Endeavor Bancorp Contact Information:
(858) 230.5185
Dan Yates, CEO
dyates@bankendeavor.com

(858) 230.4243
Steve Sefton, President
ssefton@bankendeavor.com

The MIL Network –

January 29, 2025

MIL-OSI: Community Bankshares, Inc. Acquires Thomas USAF / Thomas Financial Group to Completely Revolutionize Government-Guaranteed Lending Nationwide

Source: GlobeNewswire (MIL-OSI)

LAGRANGE, Ga., Jan. 28, 2025 (GLOBE NEWSWIRE) — Community Bankshares, Inc., one of the fastest-growing financial services companies in the nation, announces its acquisition of Thomas USAF / Thomas Financial Group, a 30-year industry leader in USDA government-guaranteed commercial lending. This acquisition, coming on the heels of the recent launch of Phoenix Lender Services, underscores Community Bankshares’ bold strategy to redefine the financial services landscape and expand its leadership in innovative lending solutions for rural and underserved markets across the United States.

A Future-Focused Partnership

“This is not just an acquisition — it’s a reimagining of what’s possible in government-guaranteed lending,” said Jeremy Gilpin, Chairman of the Board of Community Bankshares, Inc. “By combining the proven track record of Thomas Financial Group as a top USDA originator and packager with the cutting-edge capabilities of Phoenix Lender Services and lending expertise of Community Bank & Trust, we’re setting a new standard for how rural and underserved markets can access capital and thrive.”

The acquisition builds on Community Bankshares’ strategic vision of redefining how lending capital is provided across America in a manner that promotes business stability and encourages community prosperity.

Jeremy Gilpin and Chris Hurn bring more than 60 years of combined experience in government-guaranteed lending. Together, they have assembled a powerhouse leadership team within the Community Bankshares companies that is certain to shake up the industry. Their shared vision, innovative strategies, and proven success in government-guaranteed lending sets the stage for a transformative era in rural economic development and business financing.

A Legacy of Leadership

Founded by visionary entrepreneur Mike Thomas, Thomas USAF / Thomas Financial Group has been a pioneer in leveraging USDA and SBA lending programs to empower small businesses and revitalize communities. Consistently ranked as one of the top originators and packagers of USDA and SBA loans in the nation, the company has facilitated over $5 billion in financing to businesses across diverse industries, helping them navigate complex lending scenarios and achieve their financial goals.

“Founding Thomas Financial was not just about lending—it was about giving rural and underserved communities a fighting chance to grow and thrive,” said Mike Thomas, Founder of Thomas Financial Group. “As I hand the reins to the brilliant Jeremy Gilpin and the exceptional leadership at Community Bankshares, I am proud of the legacy we leave behind and confident in the transformative impact this partnership will have nationwide.”

Mike Thomas will remain actively engaged with the organization to assist with Governmental Affairs, playing a key role in shaping its strategic direction. Leveraging his decades of experience and extensive industry relationships, Mr. Thomas will focus on advocating for rural and underserved markets, as well as small businesses, to strengthen the company’s leadership in the government-guaranteed lending sector. His ongoing involvement ensures that Thomas Financial Group, along with the entire Community Bankshares family of companies, remains at the forefront of legislative initiatives, policy development, and strategic partnerships with government agencies.

“This acquisition reflects our unwavering commitment to transforming access to capital in underserved markets,” said Gilpin. “With the expertise of Thomas Financial Group and our shared values, we are building a new era of opportunity for businesses and communities nationwide.”

Community Bankshares is now positioned as a leader in addressing current challenges faced by small businesses and rural economies, particularly as they navigate a rapidly evolving financial landscape. The partnership will also ensure the continued legacy of excellence established by Thomas Financial Group, now a wholly owned subsidiary of Community Bankshares.

“We are poised to lead one of the most innovative and forward-thinking organizations in the government-guaranteed lending sector nationwide,” said Chris Hurn, President of Community Bankshares. “This collaboration not only enhances our capacity to serve businesses across the spectrum, from startups to established enterprises, but it also reaffirms our commitment to championing economic growth in rural and underserved markets. Together, we will ensure these communities remain integral to the progress and prosperity of our nation’s economy.”

For more information about Thomas Financial Group, visit www.ThomasFinancialGroup.com.

About Thomas Financial Group

Thomas Financial Group, based in Atlanta, Georgia, is now a subsidiary of Community Bankshares, Inc. and a nationally recognized leader in commercial lending solutions. Specializing in USDA and SBA programs, the company has a proven track record of empowering businesses, strengthening rural and underserved communities, and advancing government-guaranteed lending.

About Community Bankshares, Inc.

Headquartered in LaGrange, Georgia, Community Bankshares, Inc. is the parent company of Community Bank & Trust and a network of financial service subsidiaries. Phoenix Lender Services (PHX) is a subsidiary of Community Bankshares, Inc. Whose mission is redefining the way lending capital is provided across America, in a manner that promotes business stability and encourages community prosperity. The company serves a diverse clientele across the nation, fostering growth, opportunity, and collaboration.

Media Contact:

Hannah Williams
Uproar by Moburst for Community Bankshares Inc
hannah.williams@moburst.com

The MIL Network –

January 29, 2025

MIL-OSI: BCB Bancorp, Inc. Earns $3.3 Million in Fourth Quarter 2024; Reports $0.16 EPS and Declares Quarterly Cash Dividend of $0.16 Per Share

Source: GlobeNewswire (MIL-OSI)

BAYONNE, N.J., Jan. 28, 2025 (GLOBE NEWSWIRE) — BCB Bancorp, Inc. (the “Company”), (NASDAQ: BCBP), the holding company for BCB Community Bank (the “Bank”), today reported net income of $3.3 million for the fourth quarter of 2024, compared to $6.7 million in the third quarter of 2024, and $6.1 million for the fourth quarter of 2023. Earnings per diluted share for the fourth quarter of 2024 were $0.16, compared to $0.36 in the preceding quarter and $0.35 in the fourth quarter of 2023. Net income and earnings per diluted share for the fourth quarter of 2024, without giving effect to the Company’s unrealized losses on equity investments and the loss on sale of non-performing loans, were $4.1 million and $0.24, respectively.

The Company also announced that its Board of Directors declared a regular quarterly cash dividend of $0.16 per share. The dividend will be payable on February 24, 2025 to common shareholders of record on February 7, 2025.

“We took a number of positive actions during 2024 that have strengthened our balance sheet position. We meaningfully reduced our exposure to wholesale funding and continue to work hard on replacing higher cost funding with core deposits. Additionally, we have strengthened our capital position through positive retained earnings, favorable capital actions and selective loan growth. We have been prudently building up our CECL reserves to address asset quality issues. As we tackle and remediate credit quality issues, we are also positioning the Bank to gradually start lending and booking new business with both existing and new customers,” stated Michael Shriner, President and Chief Executive Officer.

Executive Summary

Total deposits were $2.751 billion at December 31, 2024 compared to $2.725 billion at September 30, 2024.
Net interest margin was 2.53 percent for the fourth quarter of 2024, compared to 2.58 percent for the third quarter of 2024, and 2.57 percent for the fourth quarter of 2023.
- Total yield on interest-earning assets was 5.33 percent for the fourth quarter of 2024 compared to 5.44 percent for the third quarter of 2024, and 5.33 percent for the fourth quarter of 2023.
- Total cost of interest-bearing liabilities was 3.57 percent for the fourth quarter of 2024, compared to 3.62 percent for the third quarter of 2024, and 3.45 percent for the fourth quarter of 2023.
The efficiency ratio for the fourth quarter was 62.1 percent compared to 53.2 percent in the prior quarter, and 61.0 percent in the fourth quarter of 2023.
The annualized return on average assets ratio for the fourth quarter was 0.36 percent, compared to 0.72 percent in the prior quarter, and 0.63 percent in the fourth quarter of 2023.
The annualized return on average equity ratio for the fourth quarter was 4.0 percent, compared to 8.3 percent in the prior quarter, and 7.9 percent in the fourth quarter of 2023.
The provision for credit losses was $4.2 million in the fourth quarter of 2024 compared to $2.9 million for the third quarter of 2024, and $1.9 million for the fourth quarter of 2023.
The allowance for credit losses (“ACL”) as a percentage of total loans was 1.15 percent at December 31, 2024 compared to 1.11 percent at the prior quarter-end and 1.01 percent at December 31, 2023.
Total loans receivable, net of the allowance for credit losses, of $2.996 billion at December 31, 2024, decreased 8.6 percent from $3.280 billion at December 31, 2023.

Balance Sheet Review

Total assets decreased by $233.3 million, or 6.1 percent, to $3.599 billion at December 31, 2024, from $3.832 billion at December 31, 2023. The decrease in total assets was due to a decrease in loans of $283.4 million, offset by an increase of $37.8 million in cash and cash equivalents. The decrease in loans was primarily from loan sales and payoffs/paydowns that exceeded loan originations.

Total cash and cash equivalents increased by $37.8 million, or 13.5 percent, to $317.3 million at December 31, 2024, from $279.5 million at December 31, 2023. The increase was primarily due to loan sales and payoffs/paydowns that exceeded loan originations.

Loans receivable, net, decreased by $283.4 million, or 8.6 percent, to $2.996 billion at December 31, 2024, from $3.280 billion at December 31, 2023. Total loan decreases during the period included decreases of $187.4 million in commercial real estate multi-family loans, $57.4 million in construction loans, $29.4 million in commercial business loans, $8.4 million in residential 1-4 family loans, and $1.4 million in consumer loans. Home equity loans increased $438 thousand. The allowance for credit losses on loans increased $1.2 million to $34.8 million, or 77.8 percent of non-accruing loans and 1.15 percent of gross loans, at December 31, 2024, as compared to an allowance for credit losses on loans of $33.6 million, or 178.9 percent of non-accruing loans and 1.01 percent of gross loans, at December 31, 2023.

Total investment securities increased by $14.3 million, or 14.8 percent, to $111.2 million at December 31, 2024, from $96.9 million at December 31, 2023, as excess liquidity has been deployed into the securities portfolio.

Deposits decreased by $228.2 million, or 7.7 percent, to $2.751 billion at December 31, 2024, from $2.979 billion at December 31, 2023. A majority of the decline was due to a decrease in certificates of deposit of $193.5 million. The reduction in certificates of deposit was mainly caused by the withdrawal of brokered deposits which was partially offset by an increase in retail time deposits.

Total borrowings decreased by $12.1 million to $498.3 million at December 31, 2024 from $510.4 million at December 31, 2023. The decrease in borrowings was primarily due to the maturity of $18.0 million of FHLB debt that was paid off during 2024. The weighted average interest rate of the Company’s outstanding FHLB advances was 4.35 percent at December 31, 2024 and 4.21 percent at December 31, 2023. The weighted average maturity of such FHLB advances as of December 31, 2024 was 0.97 years. The interest rate of the Company’s subordinated debt balances was 9.25 percent at December 31, 2024 and 8.36 percent at December 31, 2023.

Stockholders’ equity increased by $9.9 million, or 3.1 percent, to $323.9 million at December 31, 2024, from $314.1 million at December 31, 2023. The increase was primarily attributable to the increase in retained earnings of $5.9 million, or 4.4 percent, to $141.9 million at December 31, 2024 from $135.9 million at December 31, 2023.

Fourth Quarter 2024 Income Statement Review

Net income was $3.3 million for the quarter ended December 31, 2024 and $6.1 million for the quarter ended December 31, 2023. In the fourth quarter of 2024, the Bank recorded $2.2 million more in loan loss provisioning, and net interest income declined by $1.7 million. Non-interest income was also lower by $2.3 million. Offsetting these declines was a decrease in non-interest expense of $2.2 million. The Bank also recorded $1.3 million less for income tax provisioning.

Net interest income decreased by $1.7 million, or 7.2 percent, to $22.2 million for the fourth quarter of 2024, from $23.9 million for the fourth quarter of 2023. The decrease in net interest income resulted from lower interest income, offset by lower interest expense.

Interest income decreased by $3.1 million, or 6.1 percent, to $46.7 million for the fourth quarter of 2024, from $49.7 million for the fourth quarter of 2023. The average balance of interest-earning assets decreased $226.6 million, or 6.1 percent. The rate of return remained flat at 5.33 percent.

Interest expense declined $1.3 million, to $24.5 million, for the fourth quarter of 2024, from $25.8 million for the fourth quarter of 2023. Average interest-bearing liabilities decreased $247.2 million, or 8.3 percent. The average yield on these liabilities was 3.57 percent, versus 3.45 percent from one year earlier.

The net interest margin was 2.53 percent for the fourth quarter of 2024 compared to 2.57 percent for the fourth quarter of 2023. The decrease in the net interest margin compared to the fourth quarter of 2023 was the result of the increase in the cost of interest-bearing liabilities. The yield on interest earning assets remained the same from one year earlier.

During the fourth quarter of 2024, the Company recognized $4.1 million in net charge-offs compared to $233 thousand in net charge offs for the fourth quarter of 2023. The Bank had non-accrual loans totaling $44.7 million, or 1.48 percent of gross loans, at December 31, 2024 as compared to $18.8 million, or 0.57 percent of gross loans, at December 31, 2023. The allowance for credit losses on loans was $34.8 million, or 1.15 percent of gross loans, at December 31, 2024, and $33.6 million, or 1.01 percent of gross loans, at December 31, 2023. The provision for credit losses on loans was $4.2 million for the fourth quarter of 2024 compared to $1.9 million for the fourth quarter of 2023. Management believes that the allowance for credit losses on loans was adequate at December 31, 2024 and December 31, 2023.

Non-interest income decreased by $2.3 million to $938 thousand for the fourth quarter of 2024 from $3.2 million in the fourth quarter of 2023. The decrease in total non-interest income was related to losses on equity investments of $661 thousand in the 2024 quarter as compared to a gain on such investments of $1.1 million in the 2023 quarter, as well as the recordation of a $570 thousand loss on the sale of a non-performing loan during the fourth quarter.

Non-interest expense decreased by $2.2 million, or 13.3 percent, to $14.4 million for the fourth quarter of 2024 from $16.6 million for the fourth quarter of 2023. The decrease in these expenses for the fourth quarter of 2024 was driven by lower salaries and benefits expense, which declined $857 thousand. The fourth quarter of 2023 salaries and benefits included a previously disclosed one-time payment of $1.17 million to a former executive officer. Professional fees, regulatory assessment fees and advertising and promotional costs also declined by $388 thousand, $373 thousand, and $191 thousand, respectively.

The income tax provision decreased by $1.3 million, or 48.4 percent, to $1.3 million for the fourth quarter of 2024. The provision was $2.6 million for the fourth quarter of 2023. The consolidated effective tax rate was 29.0 percent for the fourth quarter of 2024 and 29.9 percent for the fourth quarter of 2023.

Year-to-Date Income Statement Review

Net income decreased by $10.9 million, or 36.8 percent, to $18.6 million for the twelve months of 2024 from $29.5 million for the twelve months of 2023. The decrease in net income was driven, primarily, by lower net interest income of $12.0 million, or 11.6 percent, and an increase in the provision for credit losses by $5.5 million.

Net interest income decreased by $12.0 million, or 11.6 percent, to $92.0 million for the first twelve months of 2024 from $104.1 million for the twelve months of 2023. The decrease in net interest income resulted from an increase in interest expense of $17.7 million, partly offset by an increase in interest income of $5.6 million.

Interest income increased by $5.6 million, or 3.0 percent, to $194.0 million for the twelve months of 2024, from $188.4 million for the twelve months of 2023. The increase was due to an increase of 22 basis points on interest earning assets, from 5.16 percent to 5.38 percent. Offsetting this, somewhat, was a decrease in average interest earning assets of $47.5 million, for the comparable period, which was comprised of a decrease in average loans of $84.8 million offset by an increase in average other interest-earning assets of $37.6 million.

Interest expense increased by $17.7 million, or 21.0 percent, to $102.0 million for 2024, from $84.3 million for 2023. This increase resulted primarily from an increase in the average rate on interest-bearing liabilities of 64 basis points to 3.57 percent for the twelve months of 2024, from 2.93 percent for the twelve months of 2023. Offsetting this was a decrease in average interest bearing liabilities of $18.5 million over the same comparable time period.

Net interest margin was 2.55 percent for the twelve months of 2024, compared to 2.85 percent for the twelve months of 2023. The decrease in the net interest margin compared to the prior period was largely the result of an increase in the cost of the Bank’s interest-bearing liabilities.

During the twelve months of 2024, the Company experienced $10.4 million in net charge offs compared to $704 thousand in net charge offs for the same period in 2023. The provision for credit losses was $11.6 million for the twelve months of 2024 compared to $6.1 million for the same period in 2023.

Non-interest income decreased by $1.1 million to $2.9 million for the twelve months of 2024 from $4.1 million for the twelve months of 2023. The decrease was due to losses on sales of loans of $5.3 million. This was offset by realized and unrealized gains or losses on equity investments, which were $3.7 million greater, and income on Bank-owned Life Insurance (BOLI), which was $883 thousand higher, for the comparable period. The realized and unrealized gains or losses on equity investments are based on prevailing market conditions.

Non-interest expense decreased by $3.5 million, or 5.7 percent, to $57.1 million for the twelve months of 2024 from $60.6 million for the same period in 2023. The decrease in operating expenses for 2024 was driven primarily by decreases in salaries and employee benefits of $2.6 million and advertising and promotional costs of $485 thousand. The 2023 salaries and benefits expense included the payment to a former executive described above.

The income tax provision decreased by $4.3 million, or 36.6 percent to $7.6 million for the twelve months of 2024 from $12.0 million for the same period in 2023. The consolidated effective tax rate was 29.1 percent for the twelve months of 2024 compared to 28.9 percent for the twelve months of 2023.

Asset Quality

During the fourth quarter of 2024, the Company recognized $4.1 million in net charge offs, compared to $233 thousand in net charge offs for the fourth quarter of 2023.

The Bank had non-accrual loans totaling $44.7 million, or 1.48 percent of gross loans, at December 31, 2024, as compared to $18.8 million, or 0.57 percent of gross loans, at December 31, 2023. The allowance for credit losses on loans was $34.8 million, or 1.15 percent of gross loans, at December 31, 2024, and $33.6 million, or 1.01 percent of gross loans, at December 31, 2023. The allowance for credit losses on loans was 77.8 percent of non-accrual loans at December 31, 2024, and 178.9 percent of non-accrual loans at December 31, 2023.

About BCB Bancorp, Inc.

BCB Bancorp, Inc. is a New Jersey corporation established in 2003, and is the holding company parent of BCB Community Bank. The Company has not engaged in any significant business activity other than owning all of the outstanding common stock of the Bank. Established in 2000 and headquartered in Bayonne, N.J., the Bank is the wholly-owned subsidiary of BCB Bancorp, Inc. (NASDAQ: BCBP). The Bank has twenty-three New Jersey branch offices in Bayonne, Edison, Hoboken, Fairfield, Holmdel, Jersey City, Lyndhurst, Maplewood, Monroe Township, Newark, Parsippany, Plainsboro, River Edge, Rutherford, South Orange, Union, and Woodbridge, New Jersey, and four New York branch offices in Hicksville and Staten Island, New York. The Bank provides businesses and individuals a wide range of loans, deposit products, and retail and commercial banking services. For more information, please go to www.bcb.bank.

Forward-Looking Statements

This release, like many written and oral communications presented by BCB Bancorp, Inc., and our authorized officers, may contain certain forward-looking statements regarding our prospective performance and strategies within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of said safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identified by use of words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “seek,” “strive,” “try,” or future or conditional verbs such as “could,” “may,” “should,” “will,” “would,” or similar expressions. Our ability to predict results or the actual effects of our plans or strategies is inherently uncertain. Accordingly, actual results may differ materially from anticipated results.

The most significant factor that could cause future results to differ materially from those anticipated by our forward-looking statements include the ongoing impact of higher inflation levels and higher interest rates concerns, all of which could impact economic growth and could cause a reduction in financial transactions and business activities, including decreased deposits and reduced loan originations, our ability to manage liquidity and capital in a rapidly changing and unpredictable market, and supply chain disruptions.. Other factors that could cause future results to vary materially from current management expectations as reflected in our forward-looking statements include, but are not limited to: the global impact of the military conflicts in the Ukraine and the Middle East; unfavorable economic conditions in the United States generally and particularly in our primary market area; the Company’s ability to effectively attract and deploy deposits; the impact of any future pandemics or other natural disasters; changes in the Company’s corporate strategies, the composition of its assets, or the way in which it funds those assets; shifts in investor sentiment or behavior in the securities, capital, or other financial markets, including changes in market liquidity or volatility; the effects of declines in real estate values that may adversely impact the collateral underlying our loans; increase in unemployment levels and slowdowns in economic growth; our level of non-performing assets and the costs associated with resolving any problem loans including litigation and other costs; the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of our loan and investment securities portfolios; the credit risk associated with our loan portfolio; changes in the quality and composition of the Bank’s loan and investment portfolios; changes in our ability to access cost-effective funding; deposit flows; legislative and regulatory changes, including increases in Federal Deposit Insurance Corporation, or FDIC, insurance rates; monetary and fiscal policies of the federal and state governments; changes in tax policies, rates and regulations of federal, state and local tax authorities; demands for our loan products; demand for financial services; competition; changes in the securities or secondary mortgage markets; changes in management’s business strategies; changes in consumer spending; our ability to retain key employees; the effects of any reputational, credit, interest rate, market, operational, legal, liquidity, or regulatory risk; expanding regulatory requirements which could adversely affect operating results; civil unrest in the communities that we serve; and other factors discussed elsewhere in this report, and in other reports we filed with the SEC, including under “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K, and our other periodic reports that we file with the SEC.

Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

Explanation of Non-GAAP Financial Measures

Reported amounts are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). This press release also contains certain supplemental Non-GAAP information that the Company’s management uses in its analysis of the Company’s financial results. The Company’s management believes that providing this information to analysts and investors allows them to better understand and evaluate the Company’s financial results for the periods in question.

The Company provides measurements and ratios based on tangible stockholders’ equity and efficiency ratios. These measures are utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, the Company’s management believes that such information is useful to investors. For a reconciliation of GAAP to Non-GAAP financial measures included in this press release, see “Reconciliation of GAAP to Non-GAAP Financial Measures” below.


	Statements of Income – Three Months Ended,
	December 31, 2024			September 30, 2024		December 31, 2023		Dec 31, 2024 vs. Sept 30, 2024		Dec 31, 2024 vs. Dec 31, 2023
Interest and dividend income:	(In thousands, except per share amounts, Unaudited)
Loans, including fees	$	41,431		$	42,857	$	43,893	-3.3	%	-5.6	%
Mortgage-backed securities		473			303		293	56.1	%	61.4	%
Other investment securities		978			994		991	-1.6	%	-1.3	%
FHLB stock and other interest-earning assets		3,771			4,472		4,527	-15.7	%	-16.7	%
Total interest and dividend income		46,653			48,626		49,704	-4.1	%	-6.1	%

Interest expense:
Deposits:
Demand		5,866			5,686		5,015	3.2	%	17.0	%
Savings and club		156			146		177	6.8	%	-11.9	%
Certificates of deposit		12,218			13,670		13,308	-10.6	%	-8.2	%
		18,240			19,502		18,500	-6.5	%	-1.4	%
Borrowings		6,219			6,079		7,282	2.3	%	-14.6	%
Total interest expense		24,459			25,581		25,782	-4.4	%	-5.1	%

Net interest income		22,194			23,045		23,922	-3.7	%	-7.2	%
Provision for credit losses		4,154			2,890		1,927	43.7	%	115.6	%

Net interest income after provision for credit losses		18,040			20,155		21,995	-10.5	%	-18.0	%

Non-interest income income (loss) :
Fees and service charges		1,187			1,196		1,445	-0.8	%	-17.9	%
(Loss) gain on sales of loans		(554	)		35		11	-1682.9	%	-5136.4	%
Realized and unrealized gain (loss) on equity investments		(661	)		1,132		1,029	-158.4	%	-164.2	%
Bank-owned life insurance (“BOLI”) income		636			652		597	-2.5	%	6.5	%
Other		330			112		69	194.6	%	378.3	%
Total non-interest income		938			3,127		3,228	-70.0	%	-70.9	%

Non-interest expense:
Salaries and employee benefits		7,117			7,139		7,974	-0.3	%	-10.7	%
Occupancy and equipment		2,483			2,591		2,606	-4.2	%	-4.7	%
Data processing and communications		1,754			1,681		1,721	4.3	%	1.9	%
Professional fees		599			618		987	-3.1	%	-39.3	%
Director fees		269			351		274	-23.4	%	-1.8	%
Regulatory assessment fees		769			666		1,142	15.5	%	-32.7	%
Advertising and promotions		212			182		403	16.5	%	-47.4	%
Other real estate owned, net		–			–		4	0.0	%	-100.0	%
Other		1,164			701		1,457	66.0	%	-20.1	%
Total non-interest expense		14,367			13,929		16,568	3.1	%	-13.3	%

Income before income tax provision		4,611			9,353		8,655	-50.7	%	-46.7	%
Income tax provision		1,339			2,685		2,593	-50.1	%	-48.4	%

Net Income		3,272			6,668		6,062	-50.9	%	-46.0	%
Preferred stock dividends		475			475		182	-0.0	%	160.7	%
Net Income available to common stockholders	$	2,797		$	6,193	$	5,880	-54.8	%	-52.4	%

Net Income per common share-basic and diluted
Basic	$	0.16		$	0.36	$	0.35	-54.9	%	-52.9	%
Diluted	$	0.16		$	0.36	$	0.35	-54.9	%	-53.0	%

Weighted average number of common shares outstanding
Basic		17,056			17,039		16,876	0.1	%	1.1	%
Diluted		17,108			17,064		16,884	0.3	%	1.3	%

	Statements of Income – Twelve Months Ended,
	December 31, 2024			December 31, 2023			Dec 31, 2024 vs. Dec 31, 2023
Interest and dividend income:	(In thousands, except per share amounts, Unaudited)
Loans, including fees	$	172,046		$	169,559		1.5	%
Mortgage-backed securities		1,378			880		56.6	%
Other investment securities		3,953			4,226		-6.5	%
FHLB stock and other interest-earning assets		16,632			13,695		21.4	%
Total interest and dividend income		194,009			188,360		3.0	%

Interest expense:
Deposits:
Demand		22,158			16,915		31.0	%
Savings and club		620			620		0.0	%
Certificates of deposit		55,442			39,157		41.6	%
		78,220			56,692		38.0	%
Borrowings		23,768			27,606		-13.9	%
Total interest expense		101,988			84,298		21.0	%

Net interest income		92,021			104,062		-11.6	%
Provision for credit losses		11,570			6,104		89.5	%

Net interest income after provision for credit losses		80,451			97,958		-17.9	%

Non-interest income:
Fees and service charges		4,717			5,334		-11.6	%
(Loss) gain on sales of loans		(5,325	)		36		-14891.7	%
Realized and unrealized gain (loss) on equity investments		379			(3,361	)	-111.3	%
Bank-owned life insurance (“BOLI”) income		2,634			1,751		50.4	%
Other		535			251		113.1	%
Total non-interest income		2,940			4,088		-28.1	%

Non-interest expense:
Salaries and employee benefits		28,229			30,827		-8.4	%
Occupancy and equipment		10,247			10,340		-0.9	%
Data processing and communications		6,960			6,968		-0.1	%
Professional fees		2,416			2,735		-11.7	%
Director fees		1,151			1,083		6.3	%
Regulatory assessments		3,530			3,585		-1.5	%
Advertising and promotions		863			1,348		-36.0	%
Other real estate owned, net		–			7		-100.0	%
Other		3,725			3,698		0.7	%
Total non-interest expense		57,121			60,591		-5.7	%

Income before income tax provision		26,270			41,455		-36.6	%
Income tax provision		7,647			11,972		-36.1	%

Net Income		18,623			29,483		-36.8	%
Preferred stock dividends		1,832			702		160.9	%
Net Income available to common stockholders	$	16,791		$	28,781		-41.7	%

Net Income per common share-basic and diluted
Basic	$	0.99		$	1.71		-42.1	%
Diluted	$	0.99		$	1.70		-42.0	%

Weighted average number of common shares outstanding
Basic		17,007			16,870		0.8	%
Diluted		17,018			16,932		0.5	%

Statements of Financial Condition	December 31, 2024			September 30, 2024			December 31, 2023			Dec 31, 2024 vs. Sept 30, 2024		Dec 31, 2024 vs. Dec 31, 2023
ASSETS	(In Thousands, Unaudited)
Cash and amounts due from depository institutions	$	14,075		$	12,617		$	16,597		11.6	%	-15.2	%
Interest-earning deposits		303,207			230,506			262,926		31.5	%	15.3	%
Total cash and cash equivalents		317,282			243,123			279,523		30.5	%	13.5	%

Interest-earning time deposits		735			735			735		–		–
Debt securities available for sale		101,717			98,169			87,769		3.6	%	15.9	%
Equity investments		9,472			10,133			9,093		-6.5	%	4.2	%
Loans held for sale		–			250			1,287		-100.0	%	-100.0	%
Loans receivable, net of allowance for credit losses on loans of $34,789, $34,693 and $33,608, respectively		2,996,259			3,087,914			3,279,708		-3.0	%	-8.6	%
Federal Home Loan Bank of New York (“FHLB”) stock, at cost		24,272			24,732			24,917		-1.9	%	-2.6	%
Premises and equipment, net		12,569			12,008			13,057		4.7	%	-3.7	%
Accrued interest receivable		15,176			16,496			16,072		-8.0	%	-5.6	%
Deferred income taxes		17,181			17,370			18,213		-1.1	%	-5.7	%
Goodwill and other intangibles		5,253			5,253			5,253		0.0	%	0.0	%
Operating lease right-of-use asset		12,686			13,438			12,935		-5.6	%	-1.9	%
Bank-owned life insurance (“BOLI”)		76,040			75,404			73,407		0.8	%	3.6	%
Other assets		10,476			8,745			10,428		19.8	%	0.5	%
Total Assets	$	3,599,118		$	3,613,770		$	3,832,397		-0.4	%	-6.1	%

LIABILITIES AND STOCKHOLDERS’ EQUITY

LIABILITIES
Non-interest bearing deposits	$	520,387		$	528,089		$	536,264		-1.5	%	-3.0	%
Interest bearing deposits		2,230,471			2,196,491			2,442,816		1.5	%	-8.7	%
Total deposits		2,750,858			2,724,580			2,979,080		1.0	%	-7.7	%
FHLB advances		455,361			466,424			472,811		-2.4	%	-3.7	%
Subordinated debentures		42,961			67,042			37,624		-35.9	%	14.2	%
Operating lease liability		13,139			13,878			13,315		-5.3	%	-1.3	%
Other liabilities		12,874			13,733			15,512		-6.3	%	-17.0	%
Total Liabilities		3,275,193			3,285,657			3,518,342		-0.3	%	-6.9	%

STOCKHOLDERS’ EQUITY
Preferred stock: $0.01 par value, 10,000 shares authorized		–			–			–		–		–
Additional paid-in capital preferred stock		24,723			29,763			25,043		-16.9	%	-1.3	%
Common stock: no par value, 40,000 shares authorized		–			–			–		0.0	%	0.0	%
Additional paid-in capital common stock		200,935			200,605			198,923		0.2	%	1.0	%
Retained earnings		141,853			141,770			135,927		0.1	%	4.4	%
Accumulated other comprehensive loss		(5,239	)		(5,678	)		(7,491	)	-7.7	%	-30.1	%
Treasury stock, at cost		(38,347	)		(38,347	)		(38,347	)	0.0	%	0.0	%
Total Stockholders’ Equity		323,925			328,113			314,055		-1.3	%	3.1	%

Total Liabilities and Stockholders’ Equity	$	3,599,118		$	3,613,770		$	3,832,397		-0.4	%	-6.1	%

Outstanding common shares		17,063			17,048			16,904

	Three Months Ended December 31,
		2024						2023
	Average Balance		Interest Earned/Paid		Average Yield/Rate (3)		Average Balance		Interest Earned/Paid		Average Yield/Rate (3)
	(Dollars in thousands)
Interest-earning assets:
Loans Receivable⁽⁴⁾⁽⁵⁾	$	3,081,846	$	41,431	5.38	%	$	3,311,946	$	43,893	5.30	%
Investment Securities		110,447		1,451	5.26	%		93,638		1,284	5.48	%
Other Interest-earning assets⁽⁶⁾		309,804		3,771	4.87	%		323,064		4,527	5.61	%
Total Interest-earning assets		3,502,097		46,653	5.33	%		3,728,648		49,704	5.33	%
Non-interest-earning assets		124,554						124,809
Total assets	$	3,626,651					$	3,853,457
Interest-bearing liabilities:
Interest-bearing demand accounts	$	551,971	$	2,682	1.94	%	$	578,890	$	2,184	1.51	%
Money market accounts		380,136		3,184	3.35	%		359,366		2,832	3.15	%
Savings accounts		254,093		156	0.25	%		288,108		177	0.25	%
Certificates of Deposit		1,048,341		12,218	4.66	%		1,140,656		13,307	4.67	%
Total interest-bearing deposits		2,234,541		18,240	3.27	%		2,367,020		18,500	3.13	%
Borrowed funds		508,113		6,219	4.90	%		622,860		7,282	4.68	%
Total interest-bearing liabilities		2,742,654		24,459	3.57	%		2,989,880		25,782	3.45	%
Non-interest-bearing liabilities		560,345						557,156
Total liabilities		3,302,999						3,547,036
Stockholders’ equity		323,652						306,420
Total liabilities and stockholders’ equity	$	3,626,651					$	3,853,457
Net interest income			$	22,194					$	23,922
Net interest rate spread⁽¹⁾					1.76	%					1.88	%
Net interest margin⁽²⁾					2.53	%					2.57	%

^{(1) Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.}
^{(2) Net interest margin represents net interest income divided by average total interest-earning assets.}
^{(3) Annualized.}
^{(4) Excludes allowance for credit losses.}
^{(5) Includes non-accrual loans.}
^{(6) Includes Federal Home Loan Bank of New York Stock.}

	Year Ended December 31,
		2024						2023
	Average Balance		Interest Earned/Paid		Average Yield/Rate (3)		Average Balance		Interest Earned/Paid		Average Yield/Rate (3)
	(Dollars in thousands)
Interest-earning assets:
Loans Receivable⁽⁴⁾⁽⁵⁾	$	3,196,538	$	172,046	5.38	%	$	3,281,334	$	169,559	5.17	%
Investment Securities		99,733		5,331	5.35	%		100,000		5,106	5.11	%
Other interest-earning assets⁽⁶⁾		308,248		16,632	5.40	%		270,659		13,695	5.06	%
Total Interest-earning assets		3,604,519		194,009	5.38	%		3,651,993		188,360	5.16	%
Non-interest-earning assets		124,441						123,652
Total assets	$	3,728,960					$	3,775,645
Interest-bearing liabilities:
Interest-bearing demand accounts	$	553,013	$	9,701	1.75	%	$	658,023	$	8,426	1.28	%
Money market accounts		372,205		12,457	3.35	%		334,353		8,489	2.54	%
Savings accounts		264,430		620	0.23	%		305,778		620	0.20	%
Certificates of Deposit		1,153,235		55,442	4.81	%		980,617		39,157	3.99	%
Total interest-bearing deposits		2,342,883		78,220	3.34	%		2,278,771		56,692	2.49	%
Borrowed funds		511,916		23,768	4.64	%		594,564		27,606	4.64	%
Total interest-bearing liabilities		2,854,799		101,988	3.57	%		2,873,335		84,298	2.93	%
Non-interest-bearing liabilities		554,037						602,691
Total liabilities		3,408,836						3,476,026
Stockholders’ equity		320,124						299,618
Total liabilities and stockholders’ equity	$	3,728,960					$	3,775,644
Net interest income			$	92,021					$	104,062
Net interest rate spread⁽¹⁾					1.81	%					2.22	%
Net interest margin⁽²⁾					2.55	%					2.85	%

^{(1) Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.}
^{(2) Net interest margin represents net interest income divided by average total interest-earning assets.}
^{(3) Annualized.}
^{(4) Excludes allowance for credit losses.}
^{(5) Includes non-accrual loans.}
^{(6) Includes Federal Home Loan Bank of New York Stock.}

	Financial Condition data by quarter
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023

	(In thousands, except book values)
Total assets	$	3,599,118		$	3,613,770		$	3,793,941		$	3,849,195		$	3,832,397
Cash and cash equivalents		317,282			243,123			326,870			352,448			279,523
Securities		111,189			108,302			94,965			96,189			96,862
Loans receivable, net		2,996,259			3,087,914			3,161,925			3,226,877			3,279,708
Deposits		2,750,858			2,724,580			2,935,239			2,991,659			2,979,080
Borrowings		498,322			533,466			510,710			510,573			510,435
Stockholders’ equity		323,925			328,113			320,732			320,131			314,055
Book value per common share¹	$	17.54		$	17.50		$	17.17		$	17.24		$	17.10
Tangible book value per common share²	$	17.23		$	17.19		$	16.86		$	16.93		$	16.79

	Operating data by quarter
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
	(In thousands, except for per share amounts)
Net interest income	$	22,194		$	23,045		$	23,639		$	23,143		$	23,922
Provision for credit losses		4,154			2,890			2,438			2,088			1,927
Non-interest income (loss)		938			3,127			(3,234	)		2,109			3,228
Non-interest expense		14,367			13,929			13,987			14,838			16,568
Income tax expense		1,339			2,685			1,163			2,460			2,593
Net income	$	3,272		$	6,668		$	2,817		$	5,866		$	6,062
Net income per diluted share	$	0.16		$	0.36		$	0.14		$	0.32		$	0.35
Common Dividends declared per share	$	0.16		$	0.16		$	0.16		$	0.16		$	0.16

	Financial Ratios(3)
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
Return on average assets		0.36	%		0.72	%		0.30	%		0.61	%		0.63	%
Return on average stockholders’ equity		4.04	%		8.29	%		3.52	%		7.46	%		7.91	%
Net interest margin		2.53	%		2.58	%		2.60	%		2.50	%		2.57	%
Stockholders’ equity to total assets		9.00	%		9.08	%		8.45	%		8.32	%		8.19	%
Efficiency Ratio⁴		62.11	%		53.22	%		68.55	%		58.76	%		61.02	%

	Asset Quality Ratios
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
	(In thousands, except for ratio %)
Non-Accrual Loans	$	44,708		$	35,330		$	32,448		$	22,241		$	18,783
Non-Accrual Loans as a % of Total Loans		1.48	%		1.13	%		1.01	%		0.68	%		0.57	%
ACL as % of Non-Accrual Loans		77.8	%		98.2	%		108.6	%		155.4	%		178.9	%
Individually Analyzed Loans		83,399			66,048			60,798			65,731			54,019
Classified Loans		152,714			98,316			87,033			97,739			85,727

^{(1) Calculated by dividing stockholders’ equity, less preferred equity, to shares outstanding.}
^{(2) Calculated by dividing tangible stockholders’ common equity, a non-GAAP measure, by shares outstanding. Tangible stockholders’ common equity is stockholders’ equity less goodwill and preferred stock. See “Reconciliation of GAAP to Non-GAAP Financial Measures by quarter.”}
^{(3) Ratios are presented on an annualized basis, where appropriate.}
^{(4) The Efficiency Ratio, a non-GAAP measure, was calculated by dividing non-interest expense by the total of net interest income and non-interest income. See “Reconciliation of GAAP to Non-GAAP Financial Measures by quarter.”}

	Recorded Investment in Loans Receivable by quarter
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
	(In thousands)
Residential one-to-four family	$	239,870		$	241,050		$	242,706		$	244,762		$	248,295
Commercial and multi-family		2,246,677			2,296,886			2,340,385			2,392,970			2,434,115
Construction		135,434			146,471			173,207			180,975			192,816
Commercial business		342,799			371,365			375,355			378,073			372,202
Home equity		66,769			67,566			66,843			65,518			66,331
Consumer		2,235			2,309			2,053			2,847			3,643
	$	3,033,784		$	3,125,647		$	3,200,549		$	3,265,145		$	3,317,402
Less:
Deferred loan fees, net		(2,736	)		(3,040	)		(3,381	)		(3,705	)		(4,086	)
Allowance for credit losses		(34,789	)		(34,693	)		(35,243	)		(34,563	)		(33,608	)

Total loans, net	$	2,996,259		$	3,087,914		$	3,161,925		$	3,226,877		$	3,279,708

	Non-Accruing Loans in Portfolio by quarter
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
	(In thousands)
Residential one-to-four family	$	1,387		$	410		$	350		$	429		$	270
Commercial and multi-family		32,973			27,693			27,796			12,627			8,684
Construction		586			586			586			3,225			4,292
Commercial business		10,530			6,498			3,673			5,916			5,491
Home equity		231			123			43			44			46
Consumer		–			20			–			–			–
Total:	$	45,707		$	35,330		$	32,448		$	22,241		$	18,783

	Distribution of Deposits by quarter
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
	(In thousands)
Demand:
Non-Interest Bearing	$	520,387		$	528,089		$	523,816		$	531,112		$	536,264
Interest Bearing		553,731			527,862			549,239			552,295			564,912
Money Market		395,004			366,655			371,689			361,791			370,934
Sub-total:	$	1,469,122		$	1,422,606		$	1,444,744		$	1,445,198		$	1,472,110
Savings and Club		252,491			255,115			258,680			272,051			284,273
Certificates of Deposit		1,029,245			1,046,859			1,231,815			1,274,410			1,222,697
Total Deposits:	$	2,750,858		$	2,724,580		$	2,935,239		$	2,991,659		$	2,979,080

	Reconciliation of GAAP to Non-GAAP Financial Measures by quarter

	Tangible Book Value per Share
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
	(In thousands, except per share amounts)
Total Stockholders’ Equity	$	323,925		$	328,113		$	320,732		$	320,131		$	314,055
Less: goodwill		5,253			5,253			5,253			5,253			5,253
Less: preferred stock		24,723			29,763			28,403			27,733			25,043
Total tangible common stockholders’ equity		293,949			293,097			287,076			287,145			283,759
Shares common shares outstanding		17,063			17,048			17,029			16,957			16,904
Book value per common share	$	17.54		$	17.50		$	17.17		$	17.24		$	17.10
Tangible book value per common share	$	17.23		$	17.19		$	16.86		$	16.93		$	16.79

	Efficiency Ratios
	Q4 2024			Q3 2024			Q2 2024			Q1 2024			Q4 2023
	(In thousands, except for ratio %)
Net interest income	$	22,194		$	23,045		$	23,639		$	23,143		$	23,922
Non-interest income (loss)		938			3,127			(3,234	)		2,109			3,228
Total income		23,132			26,172			20,405			25,252			27,150
Non-interest expense		14,367			13,929			13,987			14,838			16,568
Efficiency Ratio		62.11	%		53.22	%		68.55	%		58.76	%		61.02	%

CONTACT:	MICHAEL SHRINER,
	PRESIDENT & CEO
	JAWAD CHAUDHRY,
	EVP & CFO
	(201) 823-0700

The MIL Network –

January 29, 2025

MIL-OSI United Kingdom: Mayor delighted to launch Feel the Beat: An Afro-Inspired Bank Holiday Celebration

Source: Northern Ireland – City of Derry

Mayor delighted to launch Feel the Beat: An Afro-Inspired Bank Holiday Celebration

28 January 2025

The amazing sound and incredible energy of Afrobeats is set to vibrate around St Columb’s Hall at a special fundraising night planned by the Mayor of Derry City and Strabane District Council for Spring this year.

Feel the Beat: An Afro-Inspired Bank Holiday Celebration will feature top DJs Renzo Rose, DJ Rob and DJ Lui who will play a mix of Afrobeats, amapiano, dancehall, hip-hop, R’n’B and commercial music guaranteed to have you on the dancefloor all night long.

Revealing her plans for Feel the Beat, which will take place on 25^th May 2025, Mayor Lilian Seenoi Barr said: “I am so excited to bring this night of Afrobeats to St Columb’s Hall. I would encourage everyone to come along and enjoy a night of incredible energy and top tunes. It doesn’t matter if you’ve never been to an Afrobeats event before, if you love music you’ll love this night.”

The event is planned as a fundraiser for the Bud Club, the charity the Mayor has chosen to support during her year in office. BUD is an inclusive provision for young people with disabilities and specific/complex needs.

Tickets are now on sale and the Mayor is encouraging people to get theirs early to avoid disappointment. She explained: “This night is perfect for anyone who loves energetic music and would enjoy a night full of friendship and positivity. And remember, by buying a ticket you will also be supporting the awesome Bud Club and all the work that they do. This is all possible because of the sponsorship support given by the Garvan O’Doherty group.

“So get your tickets now and get ready to dance like you have never danced before at Feel the Beat in St Columb’s Hall. I can’t wait to see you all on the dancefloor.”

Tickets for the Feel the Beat: An Afro-Inspired Bank Holiday Celebration are now on sale and can be purchased at https://AfroBeatCelebration.eventbrite.co.uk

MIL OSI United Kingdom –

January 29, 2025

MIL-OSI: HomeTrust Announces the Sale of Knoxville Branches to Apex Bank

Source: GlobeNewswire (MIL-OSI)

ASHEVILLE, N.C. and CAMDEN, Tenn., Jan. 28, 2025 (GLOBE NEWSWIRE) — HomeTrust Bancshares, Inc. (NASDAQ: HTBI) (“Company”), the holding company of HomeTrust Bank (“HomeTrust”), and Apex Bank (“Apex”) today announced that HomeTrust and Apex have entered into a definitive purchase and assumption agreement (the “agreement”) under which Apex will acquire HomeTrust’s two branches in Knoxville, Tennessee. Under the terms of the agreement, Apex will acquire the physical locations, related fixed assets, and substantially all the customer deposit accounts which are currently estimated at $42 million. HomeTrust will retain the loan accounts associated with the branches.

“This transaction aligns with our strategic plan to tighten our geographic footprint, improve our branch efficiencies, and allocate our capital to support our long-term growth in other core markets,” said Hunter Westbrook, HomeTrust’s President and Chief Executive Officer.

Matt Daniels, President and CEO of Apex Bank said, “Being locally owned and operated, we are excited to expand our footprint in Knoxville. This investment will allow us to better serve customers and support the community. We will continue to look for opportunities to expand our presence in the area and remain committed to providing personalized financial solutions that help individuals and businesses thrive.”

The proposed transaction, which is subject to customary closing conditions, including approval by applicable regulatory authorities, is currently anticipated to close in the second quarter of 2025.

Piper Sandler & Co. served as HomeTrust’s financial advisor for the transaction, while Silver, Freedman Taff & Tiernan LLP provided legal counsel. Baker Donelson provided legal counsel for Apex.

About HomeTrust Bancshares, Inc.
HomeTrust Bancshares, Inc. is the holding company for HomeTrust Bank. As of December 31, 2024, the Company had assets of $4.6 billion. The Bank, founded in 1926, is a North Carolina state chartered, community-focused financial institution committed to providing value added relationship banking with over 30 locations as well as online/mobile channels. Locations include: North Carolina (the Asheville metropolitan area, the “Piedmont” region, Charlotte, and Raleigh/Cary), South Carolina (Greenville and Charleston), East Tennessee (Kingsport/Johnson City, Knoxville, and Morristown), Southwest Virginia (Roanoke Valley) and Georgia (Greater Atlanta).

About Apex Bank
Apex Bank was founded in 1931 and is headquartered in Knoxville, Tennessee. Apex Bank has experienced tremendous growth since 2008, increasing total assets from $157 million to over $1.35 billion in 2025. The bank currently has 20 retail locations and a Knoxville-based national mortgage servicing center. Apex Bank has consistently been ranked as one of the best-performing community banks in the nation for the past 16 years, including the award of Tennessee’s Top Community Bank from Independent Community Bankers of America and other leading rankings in the financial industry.

Forward-Looking Statements
This press release may include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact, but instead are based on certain assumptions including statements with respect to the Company’s beliefs, plans, objectives, goals, expectations, assumptions and statements about future economic performance and projections of financial items. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated or implied by forward-looking statements. The factors that could result in material differentiation include, but are not limited to, the impact of bank failures or adverse developments involving other banks and related negative press about the banking industry in general on investor and depositor sentiment; the remaining effects of the COVID-19 pandemic on general economic and financial market conditions and on public health, both nationally and in the Company’s market areas; natural disasters, including the effects of Hurricane Helene; expected revenues, cost savings, synergies and other benefits from merger and acquisition activities might not be realized to the extent anticipated, within the anticipated time frames, or at all, costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected, and goodwill impairment charges might be incurred; increased competitive pressures among financial services companies; changes in the interest rate environment; changes in general economic conditions, both nationally and in our market areas; legislative and regulatory changes; and the effects of inflation, a potential recession, and other factors described in the Company’s latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other documents filed with or furnished to the Securities and Exchange Commission – which are available on the Company’s website at www.htb.com and on the SEC’s website at www.sec.gov. Any of the forward-looking statements that the Company makes in this press release or in the documents the Company files with or furnishes to the SEC are based upon management’s beliefs and assumptions at the time they are made and may turn out to be wrong because of inaccurate assumptions, the factors described above or other factors that management cannot foresee. The Company does not undertake, and specifically disclaims any obligation, to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

www.htb.com
www.apexbank.com

The MIL Network –

January 29, 2025

Category: Banking

While Many Speakers Support Agency as Lifeline, Israel’s Delegate Says It Failed

Incentives, not ignorance

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Disastrous consequences

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Financial and political challenges

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Biographies

Jonathan Brearley – Chief Executive Officer

Myriam Madden – Non-Executive Director

Barry Panayi Madden – Non-Executive Director

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I. A fast-moving financial system whose resilience must be preserved in order to ensure financial stability

II. A step further with the interlinking of fast-payment systems and a European shared ledger to meet the challenges of transition and growth

Mayor delighted to launch Feel the Beat: An Afro-Inspired Bank Holiday Celebration