RED RIVER BANCSHARES INC
For the period ended Mar 31, 2025. Filed May 9, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 9, 2025
RRBI$103.55-0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-08.
0001071236-24-000088
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-09.
0001071236-25-000048
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 231 previous paragraphs and 215 current paragraphs.
110 unchanged; 81 reworded; 23 added; 37 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 29 previous and 29 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
In the first quarter of 2025, we reported an improved net interest margin, higher net interest income, and higher net income. The balance sheet reflected good loan growth, while deposits and assets had slight increases. We increased the quarterly cash dividend paid to shareholders by 33.3% to $0.12 per share for the first quarter of 2025. Also, in the first quarter, we completed significant upgrades to our digital banking systems.
Current report
•Net income for the first quarter of 2025 was $10.4 million, or $1.52 diluted EPS, an increase of $1.0 million, or 11.2%, compared to $9.3 million, or $1.37 diluted EPS, for the fourth quarter of 2024. Net income for the first quarter increased due to having higher net interest income, along with approximately $620,000 of periodic items that reduced operating expenses. These operating expense reductions benefited EPS by approximately $0.07.
Current report
•Deposits totaled $2.83 billion as of March 31, 2025, an increase of $20.6 million, or 0.7%, compared to $2.81 billion as of December 31, 2024. This increase was mainly due to higher balances in consumer and commercial customer deposit accounts, partially offset by the seasonal outflow of funds from public entity customers.
Current report
•As of March 31, 2025, loans HFI were $2.11 billion, which was $39.7 million, or 1.9%, higher than $2.08 billion as of December 31, 2024. In the first quarter of 2025, we had steady new loan closing activity, combined with funding of loan construction commitments.
Current report
•As of March 31, 2025, total securities were $699.5 million, which was $14.7 million, or 2.1%, higher than December 31, 2024. Securities increased mainly due to the purchase of new securities, combined with a smaller net unrealized loss on securities AFS.
Current report
•The provision for credit losses was $450,000 for the first quarter of 2025, compared to $300,000 for the prior quarter. The $150,000 increase was due to loan growth and uncertainty regarding tariffs and trade.
Current report
•In the first quarter of 2025, the quarterly cash dividend increased by 33.3% to $0.12 per common share, up from $0.09 per common share for each quarter in 2024.
Current report
•In the first quarter of 2025, Red River Bank’s online, mobile banking, and bill payment systems were upgraded in order to improve our digital services for all customers.
Current report
•In the first quarter of 2025, S&P Global Market Intelligence ranked the Bank 14th of the top 50 best deposit franchises in 2024 for banks with assets between $3.0 and $10.0 billion.
Current report
•On March 14, 2025, our board of directors and executive management had the privilege of ringing the closing bell at the Nasdaq Market Site in New York to commemorate being a public company for 6 years.
Current report
Net income for the first quarter of 2025 was $10.4 million, or $1.52 diluted EPS, an increase of $1.0 million, or 11.2%, compared to $9.3 million, or $1.37 diluted EPS, for the fourth quarter of 2024. The increase in net income was due to a $923,000 increase in net interest income, a $277,000 increase in noninterest income, and a $252,000 decrease in operating expenses, partially offset by a $256,000 increase in income tax expense and a $150,000 increase in the provision for credit losses. The return on assets for the first quarter of 2025 was 1.32%, compared to 1.18% for the fourth quarter of 2024. The return on equity was 12.85% for the first quarter of 2025, compared to 11.46% for the fourth quarter of 2024. Our efficiency ratio for the first quarter of 2025 was 55.51%, compared to 58.71% for the fourth quarter of 2024.
Current report
The provision for credit losses for the first quarter of 2025 was $450,000 for loans, which was $150,000 higher than the provision for credit losses of $300,000 for the first quarter of 2024. The increase in the first quarter of 2025 was related to loan growth in the quarter, combined with uncertainty regarding tariffs and trade. The provision in the first quarter of 2024 was due to potential economic challenges resulting from the inflationary environment, changing monetary policy, and loan growth.
Current report
Mortgage loan income decreased $122,000 to $530,000 for the first quarter of 2025, compared to the prior quarter due to decreased purchase activity.
Current report
Noninterest income increased $344,000 to $5.3 million for the three months ended March 31, 2025, compared to $4.9 million for the three months ended March 31, 2024. The increase in noninterest income was mainly due to higher brokerage income. Beginning in January 2024, net debit card income has been impacted by a new debit card provider contract.
Current report
Debit card income, net, decreased $30,000 to $992,000 for the three months ended March 31, 2025, compared to the same period prior year. For the three months ended March 31, 2024, debit card income benefited from $145,000 of nonrecurring income due to the termination of our prior debit card provider contract. This decrease was partially offset by lower debit card expenses for the three months ended March 31, 2025, due to the new debit card provider contract.
Current report
Operating expense decreased $252,000 to $16.6 million for the first quarter of 2025, compared to $16.8 million for the fourth quarter of 2024. Thedecrease in operating expenses was mainly due to lower data processing expense and loan and deposit expenses, partially offset by higher personnel expenses.
Current report
Data processing expense decreased $393,000 to $288,000 for the first quarter of 2025, compared to the prior quarter. This decrease was attributable to receipt of a $447,000 periodic refund from our data processing center in the first quarter of 2025. This decrease was partially offset by new expenses and $14,000 of nonrecurring implementation fees related to online, mobile banking, and bill payment systems implemented in the first quarter of 2025.
Current report
Loan and deposit expenses decreased $272,000 to $62,000 for the first quarter of 2025, compared to the prior quarter. This decrease was primarily attributable to receipt of a $173,000 negotiated, variable rebate from a vendor in the first quarter of 2025.
Current report
Personnel expenses increased $254,000 to $10.0 million for the first quarter of 2025, compared to the prior quarter. This increase was primarily due to an increase in head count, restarting of payroll tax expense, and increased revenue-based commission compensation. As of March 31, 2025 and December 31, 2024, we had 375 and 369 total employees, respectively.
Current report
Personnel expenses increased $473,000 to$10.0 million for thethree months ended March 31, 2025, compared to the same period prior year. This increase was primarily due to an increase in headcount and increased revenue-based commission compensation. As of March 31, 2025 and 2024, we had 375 and 358 total employees, respectively.
Current report
Other taxes decreased $125,000 to $612,000 for the three months ended March 31, 2025, compared to the same period prior year. This decrease was primarily due to $100,000 of stock repurchase excise tax expense for the three months ended March 31, 2024. Due to finalized guidance received in the second quarter of 2024, regulations require stock repurchase excise tax to be recorded as a reduction to stockholder's equity as opposed to being expensed. We did not repurchase any shares during the three months ended March 31, 2025.
Current report
Data processing expense decreased $59,000 to $288,000 for the three months ended March 31, 2025, compared to the same period prior year. This decrease was due to receipt of a $447,000 periodic refund from our data processing center in the first quarter of 2025 compared to a $284,000 similar refund in the same period prior year. This decrease was partially offset by new expenses and $14,000 of nonrecurring implementation fees related toonline banking, mobile banking, and bill payment systems implemented in the first quarter of 2025.
Current report
Energy loans were 1.4% of loans HFI as of March 31, 2025 and December 31, 2024.
Removed paragraphs (37)
Previous report
In the third quarter of 2024, the Company reported higher earnings, an improved net interest margin, and fairly consistent loans and deposits. We deployed excess funds into the securities portfolio and completed a significant stock repurchase. In mid-September, the target range of the federal funds rate was reduced by 50 bps.
Previous report
•Net income for the third quarter of 2024 was $8.8 million, or $1.27 diluted EPS, an increase of $767,000, or 9.6%, compared to $8.0 million, or $1.16 diluted EPS, for the second quarter of 2024. Net income for the third quarter benefited from higher net interest income and an improved net interest margin FTE, along with higher noninterest income.
Previous report
•Noninterest income totaled $5.4 million for the third quarter of 2024, an increase of $321,000, or 6.3%, compared to $5.1 million for the previous quarter. Noninterest income benefited from the receipt of a $151,000 nonrecurring loan fee.
Previous report
•Deposits totaled $2.75 billion as of September 30, 2024, an increase of $30.5 million, or 1.1%, compared to $2.72 billion as of June 30, 2024. In the third quarter of 2024, customer deposit balances remained consistent, with normal activity.
Previous report
•As of September 30, 2024, loans HFI were $2.06 billion, slightly higher than $2.05 billion as of June 30, 2024. In the third quarter of 2024, we closed on a high level of loan commitments, which should fund over time.
Previous report
•As of September 30, 2024, total securities were $697.7 million, which was $31.1 million, or 4.7%, higher than June 30, 2024. In the third quarter of 2024, we redeployed cash flows from lower yielding securities into higher yielding securities, as well as deployed other liquid assets into the securities portfolio.
Previous report
•In the third quarter of 2024, the provision for credit losses totaled $300,000. This included $200,000 for loans and $100,000 for unfunded loan commitments.
Previous report
•We paid a quarterly cash dividend of $0.09 per common share in the third quarter of 2024.
Previous report
•As of September 30, 2024, capital levels were strong with a stockholders’ equity to assets ratio of 10.46%, a leverage ratio of 11.90%, and a total risk-based capital ratio of 18.07%.
Previous report
•The book value per share of common stock was $47.51 as of September 30, 2024, compared to $44.58 as of June 30, 2024. This improvement was primarily due to the decrease in the accumulated other comprehensive loss related to securities and net income added to stockholders’ equity, partially offset by stock repurchases.
Previous report
Net income for the third quarter of 2024 was $8.8 million, or $1.27 diluted EPS, an increase of $767,000, or 9.6%, compared to $8.0 million, or $1.16 diluted EPS, for the second quarter of 2024. The increase in net income was due to a $670,000 increase in net interest income and a $321,000 increase in noninterest income, partially offset by a $161,000 increase in income tax expense and a $63,000 increase in operating expenses. The return on assets for the third quarter of 2024 was 1.13%, compared to 1.05% for the second quarter of 2024. The return on equity was 11.11% for the third quarter of 2024, compared to 10.69% for the second quarter of 2024. Our efficiency ratio for the third quarter of 2024 was 60.09%, compared to 62.07% for the second quarter of 2024.
Previous report
The net interest margin FTE was positively impacted by the increase in the yield on earning assets, for the nine months ended September 30, 2024, when compared to the nine months ended September 30, 2023. The yield on loans increased 53 bps due to higher rates on new and renewed loans due to the higher interest rate environment. The yield on securities increased 49 bps for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, due to reinvesting lower yielding securities cash flows into higher yielding securities. In addition, the yield on short-term liquid assets increased 35 bps due to having a higher average federal funds rate in 2024 than in 2023.
Previous report
The provision for credit losses for the nine months ended September 30, 2024, was $900,000, an increase of $415,000, or 85.6%, from $485,000 for the nine months ended September 30, 2023. The primary drivers of the increase were the recent inflationary environment, changing monetary policy, current economic forecasts, loan growth, and an increase in unfunded loan commitments. Effective January 1, 2023, we adopted ASC 326, the CECL methodology for estimating credit losses. For the cumulative effect of adopting ASC 326, we recorded a $569,000, net of tax, decrease to stockholders’ equity as of January 1, 2023. No provision expense was recorded for the first quarter of 2023 under the new CECL methodology.
Previous report
Service charges on deposit accounts increased $119,000 to $1.5 million for the third quarter of 2024, compared to the prior quarter, due to a larger number of non-sufficient fund transactions and related fee income in the third quarter of 2024.
Previous report
Loan and deposit income increased $96,000 to $588,000 for the third quarter of 2024, compared to the prior quarter. The third quarter of 2024 benefited from the receipt of a $151,000 nonrecurring loan fee.
Previous report
Noninterest income decreased $482,000 to $15.4 million for the nine months ended September 30, 2024, compared to $15.9 million for the nine months ended September 30, 2023. The decrease in noninterest income was mainly due to lower income from SBIC limited partnerships of which Red River Bank is a member, partially offset by higher mortgage loan income, a gain on equity securities, and higher net debit card income, brokerage income, and loan and deposit income.
Previous report
SBIC income decreased $1.4 million to $1.1 million for the nine months ended September 30, 2024, compared to the same period prior year. For the nine months ended September 30, 2024, we received $114,000 of distribution payments, in addition to normal income. For the nine months ended September 30, 2023, we received income from the sale of an investment, in addition to normal income.
Previous report
Mortgage loan income increased $314,000 to $1.8 million for the nine months ended September 30, 2024, compared to the same period prior year mainly due to an increase in the average loan amount, which generated higher mortgage loan fee income.
Previous report
Debit card income, net, increased $188,000 to $2.9 million for the nine months ended September 30, 2024, compared to the same period prior year. In the first quarter of 2024, we terminated our previous debit card provider contract, which resulted in $145,000 of nonrecurring income. In January 2024, a newly negotiated debit card provider contract became effective, which resulted in an increase in debit card income. These increases were partially offset by higher debit card processing expenses during the nine months ended September 30, 2024.
Previous report
Loan and deposit income increased $6,000 to $1.6 million for the nine months ended September 30, 2024, compared to the same period prior year. During the nine months ended September 30, 2024, we received $201,000 of nonrecurring loan fees, which were offset by lower deposit fees due to changing customer deposit activity.
Previous report
Operating expenses increased $63,000 to $16.8 million for the third quarter of 2024, compared to $16.7 million for the second quarter of 2024. Theincrease in operating expenses was due to higher technology expenses and other tax expenses.
Previous report
Other taxes increased $122,000 to$622,000 for the third quarter of 2024, compared to the prior quarter. The second quarter benefited from the reversal of $145,000 of stock repurchase tax expense due to finalized guidelines.
Previous report
Personnel expenses increased $846,000 to$28.9 million for thenine months ended September 30, 2024, compared to the same period prior year. This increase was primarily due to higher compensation expense as a result of net staff changes, offset by a decrease in medical insurance expense. As of September 30, 2024 and 2023, we had 366 and 360 total employees, respectively.
Previous report
Legal and professional expenses increased $286,000 to $2.0 million for the nine months ended September 30, 2024, compared to the same period prior year. This increase was due to higher contracted services, higher public company expenses, and higher professional and advisory services mainly related to a newly negotiated debit card provider contract effective January 2024.
Previous report
Technology expenses increased $232,000 to $2.3 million for the nine months ended September 30, 2024, compared to the same period prior year. This increase was primarily due to implementing new software and $32,000 of nonrecurring expenses related to our new location in the New Orleans market.
Previous report
Other business development expenses increased $138,000 to $1.6 million for the nine months ended September 30, 2024, compared to the same period prior year. This increase was mainly the result of an increase in CRA-related contributions, as well as higher marketing expenses.
Previous report
Other taxes decreased $183,000 to $1.9 million for the nine months ended September 30, 2024, compared to the same period prior year. This decreasewas primarily due to a decrease in State of Louisiana bank stock tax resulting from lower deposit account balances and lower net income for the applicable tax years.
Previous report
Energy loans were 1.6% and 1.7% of loans HFI as of September 30, 2024 and December 31, 2023, respectively.
Previous report
(1)The $900,000 provision for credit losses on the consolidated statements of income for the nine months ended September 30, 2024, includes $800,000 for loans and $100,000 for unfunded loan commitments.
Previous report
On March 13, 2024, we entered into a privately negotiated stock repurchase agreement for the purchase of 200,000 shares of our common stock for a total purchase price of approximately $10.0 million. This repurchase was supplemental to our 2024 stock repurchase program and did not impact the amount of permitted repurchases thereunder.
Previous report
On August 8, 2024, we entered into a privately negotiated stock repurchase agreement for the purchase of 60,000 shares of our common stock for a total purchase price of approximately $3.0 million. This repurchase was supplemental to our 2024 stock repurchase program. However, in connection with the repurchase, we reduced the availability under our 2024 stock repurchase program by $3.0 million.
Previous report
For the three months ended September 30, 2024, we repurchased 233 shares of our common stock from the open market at an aggregate cost of $11,000 under the stock repurchase program. For the nine months ended September 30, 2024, we repurchased 16,453 shares of our common stock from the open market at an aggregate cost of $775,000 under the stock repurchase program.
Previous report
The Federal Reserve’s Bank Term Funding Program ended on March 11, 2024. The Bank did not utilize this program while it was being offered.
Previous report
Purchase Commitment
Previous report
The Company has committed to an agreement to buy real estate for approximately $1.9 million as of September 30, 2024.
Previous report
Construction Commitment
Previous report
The Company has one committed construction agreement to construct a banking center, and there was approximately $85,000 remaining on this commitment as of September 30, 2024.
Reworded paragraphs (81)
Previous wording
The purpose of this discussion and analysis is to focus on significant changes in the financial condition of Red River Bancshares, Inc. on a consolidated basis from December 31, 2023 through September 30, 2024, and on our results of operations for the quarters ended September 30, 2024 and June 30, 2024, and for the nine months ended September 30, 2024 and September 30, 2023.
Current wording
The purpose of this discussion and analysis is to focus on significant changes in the financial condition of Red River Bancshares, Inc. on a consolidated basis from December 31, 2024 through March 31, 2025, and on our results of operations for the quarters ended March 31, 2025 and December 31, 2024, and for the three months ended March 31, 2025 and March 31, 2024.
Previous wording
THIRD QUARTER 2024 FINANCIAL AND OPERATIONAL HIGHLIGHTS
Current wording
FIRST QUARTER 2025 FINANCIAL AND OPERATIONAL HIGHLIGHTS
Previous wording
•For the third quarter of 2024, the return on assets was 1.13%, and the return on equity was 11.11%.
Current wording
•For the first quarter of 2025, the return on assets was 1.32%, and the return on equity was 12.85%.
Previous wording
•Net interest income and net interest margin FTE increased for the third quarter of 2024 compared to the prior quarter. Net interest income for the third quarter of 2024 was $22.5 million compared to $21.8 million for the prior quarter. Net interest margin FTE for the third quarter of 2024 was 2.98% compared to 2.92% for the prior quarter. These increases were due to improved yields on securities and loans outpacing higher deposit rates.
Current wording
•Net interest income and net interest margin FTE increased for the first quarter of 2025 compared to the prior quarter. Net interest income for the first quarter of 2025 was $24.6 million, which was $923,000, or 3.9%, higher than $23.7 million for the prior quarter. Net interest margin FTE increased 13 bps to 3.22% for the first quarter of 2025, compared to 3.09% for the prior quarter. These improvements resulted from higher securities yields and lower deposit rates.
Previous wording
•As of September 30, 2024, assets were $3.10 billion, which was $53.2 million, or 1.7%, higher than June 30, 2024. The increase was mainly due to a $30.5 million increase in deposits.
Current wording
•As of March 31, 2025, assets were $3.19 billion, which was $36.8 million, or 1.2%, higher than December 31, 2024. The increase was mainly due to a $20.6 million increase in deposits.
Previous wording
•As of September 30, 2024, liquid assets, which are cash and cash equivalents, were $232.6 million, and the liquid assets to assets ratio was 7.50%. We do not have any borrowings, brokered deposits, or internet-sourced deposits.
Current wording
•As of March 31, 2025, liquid assets, which are cash and cash equivalents, were $252.2 million, and the liquid assets to assets ratio was 7.91%. We do not have any borrowings, brokered deposits, or internet-sourced deposits.
Previous wording
•As of September 30, 2024, NPAs were $3.1 million, or 0.10% of assets, and the ACL was $21.8 million, or 1.06% of loans HFI.
Current wording
•As of March 31, 2025, NPAs were $5.2 million, or 0.16% of assets, and the ACL was $21.8 million, or 1.03% of loans HFI.
Previous wording
•The 2024 stock repurchase program authorizes us to purchase up to $5.0 million of our outstanding shares of common stock from January 1, 2024 through December 31, 2024. In the third quarter of 2024, we entered into a privately negotiated stock repurchase agreement for the repurchase of 60,000 shares at an aggregate cost of $3.0 million. In connection with this repurchase, we reduced the availability under the 2024 stock repurchase program by $3.0 million. We also repurchased 233 shares at an aggregate cost of $11,000 from the open market. As of September 30, 2024, the 2024 stock repurchase program had $1.2 million remaining.
Current wording
•The 2025 stock repurchase program authorizes us to purchase up to $5.0 million of our outstanding shares of common stock from January 1, 2025 through December 31, 2025. As of March 31, 2025, the 2025 stock repurchase program had $5.0 million of available capacity.
Previous wording
Net income for the nine months ended September 30, 2024, was $24.9 million, or $3.59 diluted EPS, a decrease of $1.7 million, or 6.2%, compared to $26.6 million, or $3.70 diluted EPS, for the nine months ended September 30, 2023. The decrease in net income was due to a $1.5 million increase in operating expenses, a $482,000 decrease in noninterest income, and a $415,000 increase in the provision for credit losses, partially offset by $463,000 increase in net interest income and a $240,000 decrease in income tax expense. The return on assets for the nine months ended September 30, 2024, was 1.08%, compared to 1.18% for the nine months ended September 30, 2023. The return on equity was 10.86% for the nine months ended September 30, 2024, compared to 12.71% for the nine months ended September 30, 2023. Our efficiency ratio for the nine months ended September 30, 2024, was 60.84%, compared to 59.02% for the nine months ended September 30, 2023.
Current wording
Net income for the three months ended March 31, 2025, was $10.4 million, or $1.52 diluted EPS, an increase of $2.2 million, or 26.4%, compared to $8.2 million, or $1.16 diluted EPS, for the three months ended March 31, 2024. The increase in net income was due to a $3.2 million increase in net interest income and a $344,000 increase in noninterest income, partially offset by a $715,000 increase in operating expenses, a $562,000 increase in income tax expense, and a $150,000 increase in the provision for credit losses. The return on assets for the three months ended March 31, 2025, was 1.32%, compared to 1.07% for the three months ended March 31, 2024. The return on equity was 12.85% for the three months ended March 31, 2025, compared to 10.77% for the three months ended March 31, 2024. Our efficiency ratio for the three months ended March 31, 2025, was 55.51%, compared to 60.37% for the three months ended March 31, 2024.
Previous wording
In 2023, the interest rate environment trended upward. The FOMC increased the federal funds rate by 50 bps in the first quarter of 2023, by 25 bps in the second and third quarters of 2023, then kept the rate consistent through the second quarter of 2024. Late in the third quarter of 2024, the FOMC decreased the federal funds rate by 50 bps to a target range of 4.75%-5.00%. The average effective federal funds rate was 5.26% for the third quarter of 2024, compared to 5.33% for the second quarter of 2024. For the nine months ended September 30, 2024, the average effective federal funds rate was 5.31%, compared to 4.92% for the nine months ended September 30, 2023. The net interest income and net interest margin FTE increased in the third quarter of 2024 compared to the prior quarter. The net interest income increased and the net interest margin FTE decreased for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023.
Current wording
In the first half of 2024, the target range for the federal funds rate was consistent at 5.25%-5.50%. In September of 2024, the FOMC decreased the federal funds rate by 50 bps and then by an additional 50 bps during the fourth quarter of 2024, reducing the target federal funds range to 4.25%-4.50%. The target range for the federal funds rate was unchanged in the first quarter of 2025. The average effective federal funds rate was 4.33% for the first quarter of 2025, compared to 4.65% for the fourth quarter of 2024, and 5.33% for the first quarter of 2024. Net interest income and net interest margin FTE increased in the first quarter of 2025 compared to both the prior quarter as well as the first quarter of 2024.
Previous wording
Net interest income for the third quarter of 2024 was $22.5 million, which was $670,000, or 3.1%, higher than the second quarter of 2024, due to a $1.2 million increase in interest and dividend income, partially offset by a $550,0000 increase in interest expense. The increase in interest and dividend income was due to higher interest income on loans and securities. Loan income increased $1.0 million primarily due to higher rates on new and renewed loans compared to the existing portfolio. The average rate on new and renewed loans was 7.89% for the third quarter of 2024 and 7.98% for the prior quarter. Securities income increased $266,000 due to reinvesting lower yielding securities cash flows into higher yielding securities. The increase in interest expense was primarily due to higher rates on interest-bearing transaction deposits and time deposits.
Current wording
Net interest income for the first quarter of 2025 was $24.6 million, which was $923,000, or 3.9%, higher than the fourth quarter of 2024, due to a $178,000 increase in interest and dividend income, combined with a $745,000 decrease in interest expense. The increase in interest and dividend income was mainly due to higher interest income on securities. Securities income increased $233,000 primarily due to reinvesting lower yielding securities cash flows into higher yielding securities. The decrease in interest expense was primarily due to lower rates on time deposits.
Previous wording
The net interest margin FTE increased six bps to 2.98% for the third quarter of 2024, compared to 2.92% for the prior quarter. This increase was due to improved yields on securities and loans, partially offset by higher deposit costs. The yield on securities increased 15 bps due to reinvesting lower yielding securities cash flows into higher yielding securities. The yield on loans increased 11 bps due to higher rates on new and renewed loans compared to the existing portfolio. The cost of deposits increased six bps to 1.81% for the third quarter of 2024, compared to 1.75% for the previous quarter, primarily due to a nine bp increase in the rate on interest-bearing deposits during the third quarter, partially offset by our adjustment to certain transaction deposit rates late in the third quarter.
Current wording
The net interest margin FTE increased 13 bps to 3.22% for the first quarter of 2025, compared to 3.09% for the prior quarter. This increase was due to improved yields on securities and loans, combined with lower deposit costs. The yield on securities increased 11 bps, primarily due to reinvesting lower yielding securities cash flows into higher yielding securities. The yield on loans increased 7 bps due to higher rates on new and renewed loans compared to the existing portfolio yield. The average rate on new and renewed loans was 7.02% for the first quarter of 2025 and 7.25% for the prior quarter. The cost of deposits decreased 10 bps to 1.61% for the first quarter of 2025, compared to 1.71% for the previous quarter, mainly due to lowering selected time deposit rates. As a result of this change, there was a 37 bp decrease in the rate on time deposits during the first quarter.
Previous wording
Late in the third quarter of 2024, the target range for the federal funds rate was reduced 50 bps to 4.75%-5.00%. At that time, we adjusted rates on transaction and time deposits, and we expect to continue lowering these rates in conjunction with future federal funds rate decreases. The market’s expectation is that the FOMC will continue lowering the target federal funds rate in the fourth quarter of 2024. During the twelve months ending September 30, 2025, we anticipate receiving approximately $134.0 million in securities cash flows with an average yield of 2.86%, and we project approximately $194.2 million of fixed rate loans will mature with an average yield of 5.95%. We expect to redeploy these balances into higher yielding assets. Additionally, during the twelve months ending September 30, 2025, we expect $558.5 million of time deposits to mature with an average rate of 4.47%, which we anticipate repricing into lower cost deposits. As of September 30, 2024, floating rate loans were 14.9% of loans HFI, and floating rate transaction deposits were 7.2% of interest-bearing transaction deposits. Depending on balance sheet activity and the movement in interest rates, we expect the net interest income and net interest margin FTE to improve slightly in the fourth quarter of 2024.
Current wording
The FOMC kept the federal funds rate consistent in the first quarter of 2025, with the target federal funds range remaining at 4.25%-4.50%. The market’s expectation is that the FOMC may lower the target range of the federal funds rate several times in 2025. During the remainder of 2025, we anticipate receiving approximately $80.0 million in securities cash flows with an average yield of 3.28%, and we project approximately $162.2 million of fixed rate loans will mature with an average yield of 6.15%. We expect to redeploy these balances into slightly higher yielding assets. Additionally, during the second quarter of 2025, we expect $253.6 million of time deposits to mature with an average rate of 4.06%, which we anticipate repricing into slightly lower cost deposits. As of March 31, 2025, floating rate loans were 17.6% of loans HFI, and floating rate transaction deposits were 8.7% of interest-bearing transaction deposits. Depending on balance sheet activity, the movement in interest rates, and the economic outlook, we expect the net interest income and net interest margin FTE to remain fairly consistent for the remainder of 2025.
Previous wording
(1)Includes average outstanding balances of loans HFS of$3.0 million and$3.2 million for the three months ended September 30, 2024 and June 30, 2024, respectively.
Current wording
(1)Includes average outstanding balances of loans HFS of$2.6 million and$3.2 million for the three months ended March 31, 2025 and December 31, 2024, respectively.
Previous wording
Net interest income for the nine months ended September 30, 2024 was $65.6 million, which was $463,000, or 0.7%, higher than $65.1 million for the nine months ended September 30, 2023. Net interest income increased due to a $15.1 million increase in interest and dividend income, mostly offset by a $14.6 million increase in interest expense.
Current wording
Net interest income for the three months ended March 31, 2025 was $24.6 million, which was $3.2 million, or 15.2%, higher than $21.4 million for the three months ended March 31, 2024. Net interest income increased due to a $2.8 million increase in interest and dividend income, combined with a $457,000 decrease in interest expense.
Previous wording
The increase in interest and dividend income for the nine months ended September 30, 2024, when compared to the nine months ended September 30, 2023, was mainly due to higher interest income on loans. Loan income increased $12.1 million primarily due to higher rates on new and renewed loans, combined with higher balances in loans HFI. The increase in interest expense for the nine months ended September 30, 2024, when compared to the nine months ended September 30, 2023, was due to an increase in deposit rates as we responded to deposit rate pressure, combined with larger balances in higher cost deposit accounts. During 2023, we experienced a change in the deposit mix due to customers moving deposits from lower yielding categories to higher yielding categories.
Current wording
The increase in interest and dividend income for the three months ended March 31, 2025, when compared to the three months ended March 31, 2024, was due to higher interest income on loans and securities, partially offset by a decrease in interest income on short-term liquid assets. Loan income increased $2.4 million due to higher rates on new and renewed loans compared to the existing portfolio yield, combined with higher balances in loans HFI. Securities income increased $792,000 primarily due to reinvesting lower yielding securities cash flows into higher yielding securities. The interest income on short-term liquid assets decreased $378,000 due to the FOMC lowering the federal funds rate during the second half of 2024. The decrease in interest expense for the three months ended March 31, 2025, when compared to the three months ended March 31, 2024, was primarily due to lower rates on time deposits.
Previous wording
Net interest margin FTE decreased two bps to 2.92% for the nine months ended September 30, 2024, from 2.94% for the nine months ended September 30, 2023, due to the increase in the cost of deposits exceeding the increase in the yield on earning assets. The cost of deposits increased 70 bps to 1.75% for the nine months ended September 30, 2024, from 1.05% for the nine months ended September 30, 2023, due to a 94 bp increase in the rate on interest-bearing deposits, combined with customers moving deposits from lower yielding categories to higher yielding categories. Within total interest-bearing deposits, the rate on time deposits and interest-bearing transaction deposits increased 141 and 59 bps, respectively. These rates increased as we continued to respond to deposit rate pressure. However, late in the third quarter of 2024, we adjusted rates on certain transaction and time deposits in response to the federal funds rate decrease by the FOMC.
Current wording
Net interest margin FTE increased 39 bps to 3.22% for the three months ended March 31, 2025, from 2.83% for the three months ended March 31, 2024, primarily due to higher yields on securities and loans, combined with lower deposit costs. The yield on securities increased 47 bps mainly due to reinvesting lower yielding securities cash flows into higher yielding securities. The yield on loans increased 32 bps due to higher rates on new and renewed loans compared to the existing portfolio yield. The cost of deposits decreased 9 bps to 1.61% for the three months ended March 31, 2025, from 1.70% for the three months ended March 31, 2024, due to a 19 bp decrease in the rate on interest-bearing deposits. Within total interest-bearing deposits, the rate on time deposits and interest-bearing transaction deposits decreased 32 and 11 bps, respectively. These decreases occurred as we adjusted rates on selected transaction and time deposits during the second half of 2024 in response to the federal funds rate decreases by the FOMC. We also lowered selected time deposit rates in the first quarter of 2025.
Previous wording
The following table presents average balance sheet information, interest income, interest expense, and the corresponding average yields earned and rates paid for the nine months ended September 30, 2024 and 2023:
Current wording
The following table presents average balance sheet information, interest income, interest expense, and the corresponding average yields earned and rates paid for the three months ended March 31, 2025 and 2024:
Previous wording
(1)Includes average outstanding balances of loans HFS of $2.7 million and $2.5 million for the nine months ended September 30, 2024 and 2023, respectively.
Current wording
(1)Includes average outstanding balances of loans HFS of $2.6 million and $2.0 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Increases and decreases in interest income and interest expense result from changes in average balances (volume) of interest-earning assets and interest-bearing liabilities, as well as changes in average interest rates. The following table presents the dollar amount of changes in interest income and interest expense for major components of interest-earning assets and interest-bearing liabilities for the periods presented. It distinguishes between the changes related to outstanding balances and those due to changes in interest rates.
Current wording
Increases and decreases in interest income and interest expense result from changes in average balances (volume) of interest-earning assets and interest-bearing liabilities, as well as changes in average interest rates. The following table presents the dollar amount of changes in interest income and interest expense for major components of interest-earning assets and interest-bearing liabilities for the periods presented.
Previous wording
The provision for credit losses for the third quarter of 2024 totaled $300,000, which included $200,000 for loans and $100,000 for unfunded loan commitments. The provision for credit losses in the second quarter was $300,000 for loans. The provision in the second and third quarters was due to potential economic challenges resulting from the recent inflationary environment, changing monetary policy, and loan growth. In the third quarter of 2024, we had an increase in unfunded loan commitments. We will continue to evaluate future provision needs in relation to current economic situations, loan growth, trends in asset quality, forecasted information, and other conditions influencing loss expectations
Current wording
The provision for credit losses for the first quarter of 2025 was $450,000 for loans, which was $150,000 higher than the provision for credit losses of $300,000 for the prior quarter. The increase in the first quarter of 2025 was related to loan growth in the quarter, combined with uncertainty regarding tariffs and trade. The provision in the fourth quarter of 2024, which included $200,000 for loans and $100,000 for unfunded loan commitments, was due to potential economic challenges resulting from the recent inflationary environment, changing monetary policy, and loan growth. We will continue to evaluate future provision needs in relation to current economic situations, loan growth, trends in asset quality, forecasted information, and other conditions influencing loss expectations
Previous wording
Noninterest income increased $321,000 to $5.4 million for the third quarter of 2024 compared to $5.1 million for the second quarter of 2024. The increase in noninterest income was mainly due to a gain on equity securities and increases in service charges on deposit accounts, loan and deposit income, and brokerage income, partially offset by a decrease in SBIC income.
Current wording
Noninterest income increased $277,000 to $5.3 million for the first quarter of 2025 compared to $5.0 million for the fourth quarter of 2024. The increase in noninterest income was mainly due to higher brokerage income and a gain on equity securities, partially offset by lower mortgage loan income and SBIC income.
Previous wording
Brokerage income increased $94,000 to $987,000 for the third quarter of 2024, compared to the prior quarter. The higher income in the third quarter of 2024 was mainly due to increased investing activities by clients. Assets under management were $1.13 billion as of September 30, 2024, and $1.09 billion as of June 30, 2024.
Current wording
Brokerage income increased $401,000 to $1.3 million for the first quarter of 2025, compared to the prior quarter. The higher income in the first quarter of 2025 was due to increased investing activity by clients. Assets under management were $1.14 billion as of March 31, 2025, which was consistent with December 31, 2024.
Previous wording
Equity securities are an investment in a CRA mutual fund consisting primarily of bonds. The gain or loss on equity securities is a fair value adjustment primarily driven by changes in the interest rate environment. Due to the fluctuations in market rates between quarters, equity securities had a gain of $107,000 in the third quarter of 2024, compared to a loss of $13,000 for the previous quarter.
Current wording
Equity securities are an investment in a CRA mutual fund consisting primarily of bonds. The gain or loss on equity securities is a fair value adjustment primarily driven by changes in the interest rate environment. Due to the fluctuations in market rates between quarters, equity securities had a gain of $44,000 in the first quarter of 2025, compared to a loss of $91,000 for the previous quarter.
Previous wording
SBIC income for the third quarter of 2024 decreased $153,000 to $301,000, compared to the prior quarter. This decrease was primarily due to lower normal income received from these partnerships in the third quarter. We expect SBIC income to be slightly higher in the fourth quarter of 2024 when compared to the third quarter.
Current wording
SBIC income decreased $66,000 to $280,000 for the first quarter of 2025, compared to the prior quarter. This decrease was primarily due to lower normal income received from these partnerships. We expect SBIC income to be lower in future quarters due to fund value fluctuations.
Previous wording
Brokerage income increased $108,000 to $2.9 million for the nine months ended September 30, 2024, compared to the same period prior year. This increase was primarily due to higher investing activities by clients. Assets under management were $1.13 billion and $978.3 million as of September 30, 2024 and 2023, respectively.
Current wording
Brokerage income increased $338,000 to $1.3 million for the three months ended March 31, 2025, compared to the same period prior year, due to increased investing activity by clients. Assets under management were $1.14 billion and $1.07 billion as of March 31, 2025 and 2024, respectively.
Previous wording
Operating expenses increased $1.5 million to $49.3 million for the nine months ended September 30, 2024, compared to $47.9 million for the nine months ended September 30, 2023. Theincrease in operating expenses was mainly due to higher personnel expenses, legal and professional expenses, technology expenses, other business development expenses, and occupancy and equipment expenses, partially offset by lower other taxes and loan and deposit expenses.
Current wording
Operating expenses increased $715,000 to $16.6 million for the three months ended March 31, 2025, compared to $15.9 million for the three months ended March 31, 2024. Theincrease in operating expenses was mainly due to higher personnel expenses, occupancy and equipment expenses, technology expenses, and loan and deposit expenses, partially offset by lower other taxes and data processing expense.
Previous wording
Occupancy and equipment expenses increased $42,000 to$5.0 million for thenine months ended September 30, 2024, compared to the same period prior year. This increase was primarily due to a full period of expenses related to properties that were expanded or opened in 2023 and $76,000 of nonrecurring expenses related to our new location in the New Orleans market and other 2024 property renovations. The same period prior year had $189,000 of nonrecurring expenses related to opening our new operations center building and the expansion of a banking center in the Southwest market.
Current wording
Occupancy and equipment expenses increased $178,000 to$1.8 million for thethree months ended March 31, 2025, compared to the same period prior year. This increase was primarily due to an increase in equipment maintenance contract expense, a full period of expenses related to our new banking center opened in the New Orleans market in 2024, and nonrecurring expenses related to the renovation of a banking center.
Previous wording
Technology expenses increased $141,000 to $865,000 for the third quarter of 2024, compared to the prior quarter. This increase was primarily due to continued upgrades to our core banking systems and other software technology enhancements.
Current wording
Technology expenses increased $126,000 to $835,000 for the three months ended March 31, 2025, compared to the same period prior year. This increase was primarily due to continued software technology enhancements and upgrades.
Previous wording
Loan and deposit expenses decreased $167,000 to $561,000 for the nine months ended September 30, 2024, compared to the same period prior year. The nine months ended September 30, 2024, benefited from the receipt of a $262,000 negotiated, variable rebate from a vendor. This decrease was partially offset by an increase in total collection expenses.
Current wording
Loan and deposit expenses increased $104,000 to $62,000 for the three months ended March 31, 2025, compared to the same period prior year. For the three months ended March 31, 2025, we received a $173,000 negotiated, variable rebate from a vendor compared to a $262,000 similar rebate in the same period prior year.
Previous wording
For the nine months ended September 30, 2024 and 2023, income tax expense totaled $5.9 million and $6.2 million, respectively. The decrease in income tax expense was primarily due to a decrease in pre-tax income. Our effective income tax rates for the nine months ended September 30, 2024 and 2023, were 19.2% and 18.8%, respectively.
Current wording
For the quarters ended March 31, 2025 and December 31, 2024, income tax expense totaled $2.5 million and $2.2 million, respectively. This increase in income tax expense was primarily due to the increase in pre-tax income. Our effective income tax rate for the quarters ended March 31, 2025 and December 31, 2024, was 19.4% for each quarter.
Previous wording
For the quarters ended September 30, 2024 and June 30, 2024, income tax expense totaled $2.1 million and $1.9 million, respectively. The slight increase in income tax expense was primarily due to a slight increase in pre-tax income. Our effective income tax rates for the quarters ended September 30, 2024 and June 30, 2024, were 19.1% and 19.3%, respectively.
Current wording
For the three months ended March 31, 2025 and 2024, income tax expense totaled $2.5 million and $1.9 million, respectively. The increase in income tax expense was primarily due to the increase in pre-tax income. Our effective income tax rates for the three months ended March 31, 2025 and 2024, were 19.4% and 19.1%, respectively.
Previous wording
As of September 30, 2024, assets were $3.10 billion, which was $27.1 million, or 0.9%, lower than $3.13 billion as of December 31, 2023, primarily due to a decrease in deposits. Total deposits decreased $54.8 million, or 2.0%, to $2.75 billion as of September 30, 2024, from $2.80 billion as of December 31, 2023. Cash and cash equivalents decreased $72.8 million, or 23.8%, to $232.6 million and were 7.50% of assets as of September 30, 2024. Total securities decreased $16.6 million, or 2.3%, to $697.7 million and were 22.49% of assets as of September 30, 2024. Loans HFI increased $63.2 million, or 3.2%, to $2.06 billion as of September 30, 2024. As of September 30, 2024, and December 31, 2023, we had no borrowings. Stockholders’ equity increased $20.5 million during the first nine months of 2024 to $324.3 million as of September 30, 2024. As of September 30, 2024, the loans HFI to deposits ratio was 74.84%, compared to 71.13% as of December 31, 2023, and the noninterest-bearing deposits to total deposits ratio was 32.12%, compared to 32.71% as of December 31, 2023.
Current wording
As of March 31, 2025, assets were $3.19 billion, which was $36.8 million, or 1.2%, higher than $3.15 billion as of December 31, 2024, primarily due to an increase in deposits. Total deposits increased $20.6 million, or 0.7%, to $2.83 billion as of March 31, 2025, from $2.81 billion as of December 31, 2024. Cash and cash equivalents decreased $16.8 million, or 6.3%, to $252.2 million and were 7.91% of assets as of March 31, 2025. Total securities increased $14.7 million, or 2.1%, to $699.5 million and were 21.95% of assets as of March 31, 2025. Loans HFI increased $39.7 million, or 1.9%, to $2.11 billion as of March 31, 2025. As of March 31, 2025, and December 31, 2024, we had no borrowings. Stockholders’ equity increased $13.6 million during the first three months of 2025 to $333.3 million as of March 31, 2025. As of March 31, 2025, the loans HFI to deposits ratio was 74.84%, compared to 73.97% as of December 31, 2024, and the noninterest-bearing deposits to total deposits ratio was 32.08%, compared to 30.89% as of December 31, 2024.
Previous wording
Interest-bearing deposits in other banks were the third-largest component of earning assets as of September 30, 2024. Excess liquidity that is not being deployed into loans or securities is placed in these accounts. As of September 30, 2024, interest-bearing deposits in other banks were $193.0 million and were 6.2% of assets, a decrease of $59.4 million, or 23.5%, compared to $252.4 million and 8.1% of assets as of December 31, 2023. This decrease was primarily due to the outflow of customer deposits during the nine months ended September 30, 2024.
Current wording
Interest-bearing deposits in other banks were the third-largest component of earning assets as of March 31, 2025. Excess liquidity that is not being deployed into loans or securities is placed in these accounts. As of March 31, 2025, interest-bearing deposits in other banks were $215.7 million and were 6.8% of assets, a decrease of $22.7 million, or 9.5%, compared to $238.4 million and 7.6% of assets as of December 31, 2024. This decrease was primarily due to funding loan and securities growth, which exceeded deposit growth in the first quarter of 2025.
Previous wording
Our securities portfolio is the second-largest component of earning assets and provides a significant source of revenue. Securities are classified as AFS, HTM, and equity securities. As of September 30, 2024, our total securities portfolio was 22.5% of assets. It is designed primarily to provide and maintain liquidity, generate a favorable return on investments without incurring unnecessary interest rate and credit risk, and complement our lending activities. We may invest in various types of liquid assets that are permissible under governing regulations and approved by our investment policy, which include U.S. Treasury obligations, U.S. government agency obligations, certificates of deposit of insured domestic banks, mortgage-backed and mortgage-related securities, corporate notes having an investment rating of “A” or better, municipal bonds, and certain equity securities.
Current wording
Our securities portfolio is the second-largest component of earning assets and provides a significant source of revenue. Securities are classified as AFS, HTM, and equity securities. As of March 31, 2025, our total securities portfolio was 22.0% of assets. It is designed primarily to provide and maintain liquidity, generate a favorable return on investments without incurring unnecessary interest rate and credit risk, and complement our lending activities. We may invest in various types of liquid assets that are permissible under governing regulations and approved by our investment policy, which include U.S. Treasury obligations, U.S. government agency obligations, certificates of deposit of insured domestic banks, mortgage-backed and mortgage-related securities, corporate notes having an investment rating of “A” or better, municipal bonds, and certain equity securities.
Previous wording
Securities AFS and securities HTM are debt securities. Total debt securities on the consolidated balance sheets were $694.7 million as of September 30, 2024, a decrease of $16.6 million, or 2.3%, from $711.3 million as of December 31, 2023.
Current wording
Securities AFS and securities HTM are debt securities. Total debt securities on the consolidated balance sheets were $696.6 million as of March 31, 2025, an increase of $14.6 million, or 2.1%, from $681.9 million as of December 31, 2024.
Previous wording
Securities AFS are held for indefinite periods of time and are carried at estimated fair value. As of September 30, 2024, the estimated fair value of securities AFS was $560.6 million. The carrying values of our securities AFS are adjusted for unrealized gain or loss, and any unrealized gain or loss is reported on an after-tax basis as a component of AOCI in stockholders’ equity. The net unrealized loss on securities AFS decreased $12.7 million for the nine months ended September 30, 2024, resulting in a net unrealized loss of $49.5 million as of September 30, 2024, compared to a net unrealized loss of $62.2 million as of December 31, 2023.
Current wording
Securities AFS are held for indefinite periods of time and are carried at estimated fair value. As of March 31, 2025, the estimated fair value of securities AFS was $566.9 million. The carrying values of our securities AFS are adjusted for unrealized gain or loss, and any unrealized gain or loss is reported on an after-tax basis as a component of AOCI in stockholders’ equity. The net unrealized loss on securities AFS decreased $4.6 million for the three months ended March 31, 2025, resulting in a net unrealized loss of $58.7 million as of March 31, 2025, compared to a net unrealized loss of $63.2 million as of December 31, 2024.
Previous wording
Securities HTM, which we have the intent and ability to hold until maturity, are carried at amortized cost. As of September 30, 2024, the amortized cost of securities HTM was $134.1 million. Securities HTM had an unrealized loss of $17.3 million as of September 30, 2024, compared to an unrealized loss of $22.2 million as of December 31, 2023.
Current wording
Securities HTM, which we have the intent and ability to hold until maturity, are carried at amortized cost. As of March 31, 2025, the amortized cost of securities HTM was $129.7 million. Securities HTM had an unrealized loss of $21.8 million as of March 31, 2025, compared to an unrealized loss of $22.8 million as of December 31, 2024.
Previous wording
Investment activity for the nine months ended September 30, 2024, included $117.3 million in maturities, principal repayments, and calls, partially offset by $87.8 million of securities purchased. There were no sales of securities AFS, and there were no purchases or sales of securities HTM for the same period.
Current wording
Investment activity for the three months ended March 31, 2025, included $36.8 million of securities purchased, partially offset by $26.8 million in maturities, principal repayments, and calls. There were no sales of securities AFS, and there were no purchases or sales of securities HTM for the same period.
Previous wording
The securities portfolio tax-equivalent yield was 2.36% for the nine months ended September 30, 2024, compared to 1.86% for the nine months ended September 30, 2023. The increase in yield was primarily due to reinvesting lower yielding securities cash flows received between September 30, 2023 and September 30, 2024, into higher yielding securities.
Current wording
The securities portfolio tax-equivalent yield was 2.73% for the three months ended March 31, 2025, compared to 2.26% for the three months ended March 31, 2024. The increase in yield was primarily due to reinvesting lower yielding securities cash flows received between March 31, 2024 and March 31, 2025, into higher yielding securities.
Showing the first 40 of 81 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
4.2% of loans HFI as of March 31, 2025, and 4.4% as of December 31, 2024. Loans to physician and dental practices were 3.4% of loans HFI as of March 31, 2025 and December 31, 2024.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Equity securities are an investment in a CRA mutual fund consisting primarily of bonds. The gain or loss on equity securities is a fair value adjustment primarily driven by changes in the interest rate environment. Due to fluctuations in market rates, equity securities had a gain of $63,000 for the nine months ended September 30, 2024, compared to a loss of $145,000 for the same period prior year.
Previous report — wording carried elsewhere
Bank policy regarding economic value at risk simulations performed by our risk model for instantaneous parallel shifts of the yield curve, estimated fair value of equity for the subsequent one-year period should not decline by more than 10.0% for a 100 bp shift, 20.0% for a 200 bp shift, and 30.0% for a 300 bp shift.
Previous report — wording carried elsewhere
Our consolidated financial statements are prepared in accordance with GAAP and with general practices within the financial services industry. Application of these principles requires management to make estimates and assumptions about future events that affect the amounts reported in the consolidated financial statements and accompanying notes.