First Bancorp Inc ME

Net income for the six months ended June 30, 2024 was $12.2 million, down $3.2 million or 20.7% from the same period in 2023 due primarily to a decrease in net interest income resulting from higher funding costs. Earnings per common share on a fully diluted basis were $1.10 for the six months ended June 30, 2024, down $0.29 or 21.1% from the $1.39 posted for the same period in 2023. Dividends totaling $0.71 per share have been declared year-to-date, representing a payout to our shareholders of 64.3% of basic earnings per share for the period. For the quarter ended June 30, 2024, net income was $6.2 million, down $1.2 million or 16.5% from the same period in 2023. Earnings per common share on a fully diluted basis were $0.55 for the quarter ended June 30, 2024, down $0.11 or 17.1% from the $0.67 posted for the same period in 2023.

Net interest income on a tax-equivalent basis was down $3.4 million or 9.7% in the six months ended June 30, 2024 compared to the same period in 2023. The tax equivalent net interest margin for the six months ended June 30, 2024, was 2.21%, down from 2.62% for the same period in 2023. The period to period change in net interest income and net interest margin is primarily attributable to increased funding costs. For the quarter ended June 30, 2024, net interest income on a tax- equivalent basis decreased $825,000 or 5.0% compared to the same period in 2023, with the net interest margin at 2.21% compared to 2.46% for the same period in 2023.

Non-interest income for the six months ended June 30, 2024 was $7.8 million, up $358,000 or 4.8%, from the six months ended June 30, 2023. As compared to the prior year, service charges on deposit accounts were up $107,000, or 11.5%, and debit card revenue increased $43,000, or 1.7%. Revenue at First National Wealth Management increased $102,000 or 4.3% over the same period. Mortgage banking revenue decreased $68,000 or 17.6% on lower volume of mortgage sales and negative marks taken against mortgage servicing rights valuation.

Non-interest expense for the six months ended June 30, 2024 was $23.0 million, up $1.4 million or 6.7% from the six months ended June 30, 2023. FDIC insurance premiums increased $248,000 from the same period in 2023, salaries and employee benefits increased 6.8% and other operating expense increased 5.4% over the same period.

Asset quality continues to be strong and stable. Non-performing assets stood at 0.09% of total assets as of June 30, 2024, up slightly from 0.07% of total assets as of December 31, 2023 and 0.06% of total assets as of June 30, 2023. Total past-due loans remain low and were 0.15% of total loans as of June 30, 2024, down from 0.18% and slightly up from 0.14% of total loans as of December 31, 2023 and June 30, 2023, respectively.

The provision for credit losses on loans for the first six months of 2024 was $638,000, up from the $580,000 provisioned in the same period in 2023. The provision year-to-date in 2024 has been driven by loan growth, strong credit quality, and generally favorable economic forecasts. Net recoveries for the six months ended June 30, 2024 were $25,000 or 0.002% of average loans on an annualized basis, compared to net charge-offs of $48,000 or 0.005% as of the six months ended June 30, 2023. The ACL for loans increased $663,000 between December 31, 2023 and June 30, 2024, and now stands at 1.10% of loans outstanding as of June 30, 2024, as compared to 1.13% at December 31, 2023 and 1.14% at June 30, 2023.

The Company's balance sheet continued to expand in the first six months of 2024 as total assets increased $138.2 million or 4.7% year-to-date. The loan portfolio increased $118.2 million or 5.6% in the six months ended June 30, 2024 and $186.7 million or 9.1% from a year ago. Loan growth in the first six months of 2024 was centered in the commercial and residential portfolios. Commercial loans increased by $83.9 million during the period, led by increases in owner-occupied commercial real estate of $26.2 million, non-owner occupied commercial real estate of $16.3 million, commercial & industrial loans of $15.5 million, multifamily of $12.2 million and commercial construction of $10.1 million. Residential term loans increased by $11.2 million in the first six months of 2024 and residential construction loans increased by $3.2 million during the same period. The investment portfolio decreased $12.5 million year-to-date and decreased $15.4 million from a year ago based upon cash flow of amortizing securities, limited reinvestment or new purchases, and changes in the carrying value of AFS securities.

On the liability side of the balance sheet, total deposits decreased $21.6 million, or 0.8%, year-to-date to $2.58 billion. Low-cost deposits (Demand, NOW, Savings) have decreased $74.3 million, attributable in part to seasonal deposit patterns, and also to factors such as depositor preference for alternate investment vehicles and spend-down by municipal depositors of remaining stimulus funding. Money market balances have increased $11.2 million year-to-date, while local CDs decreased $10.6 million. To balance this activity and to support earning asset growth, wholesale CDs have increased $52.1 year-to-date and borrowings have increased by $161.0 million, mostly short-term.

Remaining well capitalized is a top priority for The Company. The Company's total risk-based capital ratio was 13.24% as of June 30, 2024, solidly above the well-capitalized threshold of 10.0% set by the FDIC, the FRBB, and the OCC.

Among the Company's operating ratios, the return on average assets was 0.82% and return on average tangible common equity of 11.49% for the six months ended June 30, 2024 compared to 1.10% and 15.16%, respectively, for the same period in 2023. Our non-GAAP efficiency ratio continues to be an important component in the Company's overall performance and stood at 58.70% for the six months ended June 30, 2024 compared to 51.10% for the same period in 2023, the change being attributable primarily to lower levels of net interest income.