FIRST COMMUNITY BANKSHARES INC /VA/
For the period ended Sep 30, 2025. Filed Nov 7, 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.
Sep 30, 2025 · Filed Nov 7, 2025
FCBC$45.48+0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-01.
0001437749-25-024338
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-07.
0001437749-25-033752
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 99 previous paragraphs and 103 current paragraphs.
61 unchanged; 30 reworded; 12 added; 8 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 23 previous and 23 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 (12)
Current report
Recent Developments
Current report
On July 19, 2025, the Company entered into an Agreement and Plan of Merger (the " Merger Agreement") with Hometown Bancshares, Inc., a West Virginia corporation ("Hometown"), under which the Company will acquire Hometown (the "Merger"). Hometown will cease to exist, and the Company will survive and continue to exist as a Virginia Corporation. The transaction was previously disclosed in our Form 8-K on July 19, 2025, and in Note 15, Subsequent Events, to the condensed consolidated financial statements included in our Form 10-Q for the quarter ended June 30, 2025.
Current report
Under the terms of the Merger Agreement, each share of Hometown common stock outstanding immediately prior to the effective time will be converted into the right to receive 11.706 shares of the Company's common stock, subject to customary adjustments. The completion of the Merger is subject to approval by Hometown's shareholders, receipt of required regulatory approvals, and satisfaction of other customary closing conditions.
Current report
During the quarter ended September 30, 2025, the Company and Hometown continued to work toward satisfying the closing conditions, including activities in furtherance of receiving the required regulatory approvals. As of the date of this filing, the Merger had not yet been consummated, and the Company expects the transaction to close in January of 2026, subject to the conditions described above.
Current report
The Company has incurred approximately $787 thousand of transaction-related costs during the nine months ended September 30, 2025, which are included in non-interest expense of the accompanying condensed consolidated statements of income. Additional merger-related expenses are expected to be incurred in future periods as the transaction progresses toward closing.
Current report
Net income decreased $768 thousand, or 5.89%, in the third quarter of 2025 compared to the same period in 2024. The decrease in net income is primarily attributable to an increase in non-interest expense of $2.10 million, or 8.69%. The increase in non-interest expense is attributable to increases in salaries and employee benefits of $1.22 million, or 9.31% and merger expense of $787 thousand. The merger expense is related to the forthcoming merger with Hometown Bank, with an anticipated completion date of January 2026. The increase in non-interest expense was partially offset by an increase in net interest income after provision for loan losses of $1.06 million, or 3.52% and noninterest income of $437 thousand, or 4.18%.
Current report
Nine-Month Comparison.
Current report
For the nine months ended September 30, 2025, net income declined $2.24 million, or 5.80%, compared to the same period in 2024. The decrease is primarily driven by a $3.45 million, or 3.15%, reduction in interest income and $4.22 million, or 5.82%, increase in non-interest expense. These impacts were partially offset by a $2.48 million, or 98.57%, decrease in the provision for loan losses and a $2.41 million, 8.28%, increase in non-interest income. The significant decrease in provision for loan losses is driven by a decline in the carrying value of non-performing assets and average loan balances when compared to the same period in 2024.
Current report
Average earning assets decreased by $46.54 million, or 1.63%, primarily due to a $116.18 million, or 4.73%, reduction in average loan balances. This was partially offset by a $73.10 million, or 27.03%, increase in interest-bearing deposits with banks, reflecting a shift in the earning assets mix. The yield on earning assets fell by 10 basis points, or 1.94%, driven by a 18.38% decline in the average yield earned on interest-bearing deposits with banks to 4.44% from 5.44% for the same quarter in 2024. The average loan to deposit ratio decreased to 88.78% from 92.11%, due to a decline in average loan balances, indicating a more conservative lending posture. Non-cash accretion income totaled $405 thousand down from $592 thousand in the same period of 2024.
Current report
Average interest-bearing liabilities, which consist of interest-bearing deposits and borrowings, experienced a reduction in interest expense of $571 thousand, or 3.92%, compared to the same period in 2024. The decrease was primarily driven by a decline in average balance of interest-bearing deposits of $6.66 million, or 0.37%, and a decline in the average yield of 4 basis points, or 3.67%. The decrease in yield was largely attributable to a shift in the composition of average liabilities from higher-cost time deposits to lower-yielding deposits. This shift contributed to an interest expense reduction of $536 thousand, or 3.69%.
Current report
As of September 30, 2025, the balance of the ACL totaled $31.60 million, or 1.36%, of total loans. This compares to $34.83 million as of December 31, 2024, reflecting a decrease of $3.23 million. The reduction in the ACL primarily reflects a provision for credit losses of $36 thousand, offset by net charge-offs of $3.29 million during the first nine months of 2025. The lower provision also reflects an $84.78 million, or 3.51%, decline in total loan balances and a reduction in non-performing assets, driven by regional market conditions being favorable.
Current report
On July 19, 2025, the Company entered in an Agreement and Plan of Merger with Hometown Bancshares, Inc., in an all-stock transaction valued at approximately $41.5 million, based on First Community's closing share price of common stock of $40.33 as of July 18, 2025. Following the effective time of the Merger, each outstanding share of Hometown common stock will be converted to 11.706 shares of First Community's common stock, which equates to $472.10 per share of Hometown Common Stock, subject to customary closing conditions, including regulatory and shareholder approvals. First Community expects the transaction to be minimally dilutive to tangible book value per share (non-GAAP) and to provide high-single digit accretion to earnings per share. Also, the Company does not anticipate the need for additional external financing related to the transaction.
Removed paragraphs (8)
Previous report
Net income decreased $440 thousand, or 3.47%, in the second quarter of 2025 compared to the same period in 2024. The decrease is primarily attributable to a decrease in net interest income of $1.26 million, or 3.93%; as well as an increase in non-interest expense of $558 thousand, or 2.24%. The decreases in income were offset by an increase in total noninterest income of $998 thousand, or 10.68%, as well as a decrease in provision for credit losses of $429 thousand, or 297.92%, compared to the same period in 2024.
Previous report
Six-Month Comparison.
Previous report
Net income decreased $1.47 million, or 5.75%, in the first six months of 2025 compared to the same period in 2024. The decrease is primarily attributable to a decrease in net interest income of $2.59 million, or 4.07%, as well as an increase in non-interest expense of $2.12 million, or 4.38%. The decreases in income were offset by an increase in total noninterest income of $1.97 million, or 10.58%, as well as a decrease in provision for credit losses of $1.12 million, or 96.88%, compared to the same period in 2024.
Previous report
Average earning assets decreased $27.71 million, or 0.97%, primarily due to a decrease in the average balance for loans of $134.85 million, or 5.40%. In addition, the average balance for available-for-sale securities decreased $16.30 million, or 11.26%. These decreases to earning assets were offset by an increase in the average balance for interest-bearing balances with banks of $123.44 million, or 58.66%. The yield on earning assets decreased 16 basis points, or 3.08%, with loans experiencing a decrease of 6 basis points and securities available for sale experiencing a decrease of 16 basis points. The average loan to deposit ratio decreased to 88.93% from 93.60% reported in the same quarter of 2024. Non-cash accretion income was $430 thousand for the second quarter compared to $661 thousand reported in the same period of 2024.
Previous report
Average interest-bearing liabilities, which consist of interest-bearing deposits and borrowings, experienced an increase in interest expense of $326 thousand, or 3.52%, primarily due to an increase in the average balance of deposits of $1.03 million, or 0.06%. The yield on interest-bearing liabilities increased 4 basis points primarily due to the increase in yield on time deposits.
Previous report
As of June 30, 2025, the balance of the ACL for loans was $33.02 million, or 1.40% of total loans. The ACL at June 30, 2025, decreased $1.81 million from the balance of $34.83 million recorded at December 31, 2024. This decrease included a provision of $36 thousand offset by net charge-offs for the six months of $1.86 million.
Previous report
Subsequent Event
Previous report
As reported on Form 8-K filed with the SEC on July 21, 2025, the Company, along with Hometown Bancshares, Inc. (“Hometown”) announced the execution of an Agreement and Plan of Merger (the “Agreement”) whereby the Company will acquire Hometown and its banking subsidiary, Union Bank, Inc for a total valuation of approximately $41.5 million based on closing price for the Company’s common stock of $40.33 as of July 18, 2025. Pursuant to the terms of the Agreement, Hometown shareholders will receive 11.706 shares of the Company common stock for each share of Hometown common stock that they own as of the closing date. Currently, the transaction is expected to close in the first quarter of 2026. Please refer to Note 15 of the Notes to Condensed Consolidated Financial Statements for more information on this acquisition.
Reworded paragraphs (30)
Previous wording
First Community Bankshares, Inc. (the “Company”) is a financial holding company, headquartered in Bluefield, Virginia, that provides banking products and services through its wholly owned subsidiary First Community Bank (the “Bank”), a Virginia chartered bank institution. As of June 30, 2025, the Bank operated 53 branches in Virginia, West Virginia, North Carolina and Tennessee. As of June 30, 2025, full-time equivalent employees, calculated using the number of hours worked, totaled 594. Our primary source of earnings is net interest income, the difference between interest earned on assets and interest paid on liabilities, which is supplemented by fees for services, commissions on sales, and various deposit service charges. We fund our lending and investing activities primarily through the retail deposit operations of our branch banking network. We invest our funds primarily in loans to retail and commercial customers and various investment securities. Our common stock is traded on the NASDAQ Global Select Market under the symbol FCBC.
Current wording
First Community Bankshares, Inc. (the “Company”) is a financial holding company, headquartered in Bluefield, Virginia, that provides banking products and services through its wholly owned subsidiary First Community Bank (the “Bank”), a Virginia-chartered banking institution. As of September 30, 2025, the Bank operated 52 branches in Virginia, West Virginia, North Carolina and Tennessee. As of September 30, 2025, full-time equivalent employees, calculated using the number of hours worked, totaled 586. Our primary source of earnings is net interest income, the difference between interest earned on assets and interest paid on liabilities, which is supplemented by fees for services, commissions on sales, and various deposit service charges. We fund our lending and investing activities primarily through the retail deposit operations of our branch banking network. We invest our funds primarily in loans to retail and commercial customers and various investment securities. Our common stock is traded on the NASDAQ Global Select Market under the symbol FCBC.
Previous wording
The Bank offers trust management, estate administration, and investment advisory services through its Trust Division and wholly owned subsidiary First Community Wealth Management Inc. (“FCWM”). The Trust Division manages inter vivos trusts and trusts under will, develops and administers employee benefit and individual retirement plans, and manages and settles estates. Fiduciary fees for these services are charged on a schedule related to the size, nature, and complexity of the account. Revenues consist primarily of investment advisory fees and commissions on assets under management and administration. As of June 30, 2025, the Trust Division and FCWM managed and administered $1.66 billion in combined assets under various fee-based arrangements as fiduciary or agent. The Bank also offers a full range of commercial and personal insurance products through its strategic partnership with Bankers Insurance, LLC.
Current wording
The Bank offers trust management, estate administration, and investment advisory services through its Trust Division and wholly owned subsidiary First Community Wealth Management Inc. (“FCWM”). The Trust Division manages inter vivos trusts and trusts under will, develops and administers employee benefit and individual retirement plans, and manages and settles estates. Fiduciary fees for these services are charged on a schedule related to the size, nature, and complexity of the account. Revenues consist primarily of investment advisory fees and commissions on assets under management and administration. As of September 30, 2025, the Trust Division and FCWM managed and administered $1.75 billion in combined assets under various fee-based arrangements as fiduciary or agent. The Bank also offers a full range of commercial and personal insurance products through its strategic partnership with Bankers Insurance, LLC.
Previous wording
Highlights of our results of operations for the three and six months ended June 30, 2025, and financial condition as of June 30, 2025, include the following:
Current wording
Highlights of our results of operations for the three and nine months ended September 30, 2025, and financial condition as of September 30, 2025, include the following:
Previous wording
Three*-*Month Comparison. Net interest income comprised 74.78% of total net interest and noninterest income in the second quarter of 2025 compared to 77.35% in the same quarter of 2024. Net interest income on a GAAP basis decreased $1.26 million, or 3.93%. Net interest income on a FTE basis decreased $1.25 million, with a percentage decrease of 3.91%. The net interest margin on a FTE basis decreased 14 basis points while the net interest spread on a FTE basis decreased 13 basis points. The decrease in both the net interest margin and the net interest spread was primarily the result of a decrease in interest income driven by a decrease in the yield and average balance in both the loan and the securities available for sale portfolios.
Current wording
Three*-*Month Comparison. Net interest income comprised 74.19% of total net interest and noninterest income in the third quarter of 2025 compared to 75.14% in the same quarter of 2024. Net interest income on a GAAP basis decreased $297 thousand, or 0.94% and net interest income on a FTE basis decreased $293 thousand, or 0.92%; when compared to the same period in 2024. The net interest margin on a FTE basis increased 2 basis points while the net interest spread increased 9 basis points, or 2.27%. The primary drivers of the increase were a 19-basis point reduction in interest expense on interest-bearing deposits and a 10 basis point decline in earning assets.
Previous wording
Average interest-bearing liabilities, which consist of interest-bearing deposits and borrowings, decreased $3.73 million, or 0.21%, primarily due to a decrease in time deposits of $17.81 million, or 7.23%, and a decrease in demand deposits of $6.82 million, or 1.03%. The decreases in average interest-bearing liabilities were offset by an increase in average saving deposits of $20.60 million, of 2.36%. The yield on interest-bearing liabilities decreased 4 basis points and is primarily due to the decrease in yield on savings deposits.
Current wording
Average interest-bearing liabilities, which consist of interest-bearing deposits and borrowings, decreased $21.71 million, or 1.21%, primarily due to a decrease in time deposits of $31.42 million, or 12.82%. This was partially offset by a $9.2 million, or 1.03% increase in savings deposits. The yield on interest-bearing liabilities decreased 19 basis points, or 16.10%, compared to the same period of 2024. The reduction is primarily due to decreases in average rates on time deposits of 34 basis points, or 15.74%, and savings deposits of 25 basis points, or 14.88%, resulting in an interest savings of $896 thousand, or 16.91%, compared to the same period in 2024.
Previous wording
Six-Month Comparison. Net interest income comprised 74.77% of total net interest and noninterest income in the six months ending June 30, 2025 compared to 77.36% for the same period of 2024. Net interest income on a GAAP basis decreased $2.59 million, or 4.07%. Net interest income on a FTE basis decreased $2.59 million, with a percentage decrease of 4.06%. The net interest margin on a FTE basis decreased 14 basis points while the net interest spread on a FTE basis decreased 16 basis points. The decrease in both the net interest margin and the net interest spread was primarily the result of a decrease in interest income driven by a decrease in the yield and average balance in both the loan and the securities available for sale portfolios.
Current wording
Nine-Month Comparison. Net interest income comprised 74.57% of total net interest and noninterest income in the nine months ending September 30, 2025, compared to 76.61% for the same period of 2024. Net interest income on a GAAP basis decreased $2.88 million, or 3.03%. Net interest income on a FTE basis decreased $2.88 million, with a percentage decrease of 3.02%. The net interest margin on a FTE basis decreased 8 basis points while the net interest spread decreased 7 basis points, or 1.72%. The decrease in both the net interest margin and the net interest spread was primarily the result of a decrease in interest income driven by a reduction in the yield and average balance of the loan portfolio.
Previous wording
Average earning assets decreased $21.05 million, or 0.74%, primarily due to a decrease in the average balance for loans of $144.53 million, or 5.73%. In addition, the average balance for available-for-sale securities decreased $53.08 million, or 27.66%. These decreases to earning assets were offset by an increase in the average balance for interest-bearing balances with banks of $176.55 million, or 127.51%. The yield on earning assets decreased 11 basis points, or 2.14%, primarily due to a decrease in the yield on loans of 7 basis points, or 1.33%. The average loan to deposit ratio decreased to 89.68% from 94.56% reported in the same quarter of 2024. Non-cash accretion income was $986 thousand for the first six months of 2025 compared to $ 1.44 million reported in the same period of 2024.
Current wording
Average earning assets decreased $29.64 million, or 1.04%, primarily due to a decrease in the average balance for loans of $135.06 million, or 5.40%. In addition, the average balance for available-for-sale securities decreased $36.43 million, or 21.14%. These decreases were offset by an increase in the average balance for interest-bearing balances with banks of $141.85 million, or 77.61%. The yield on earning assets decreased 11 basis points, or 2.14%, primarily due to decreases in the yield on loans of 4 basis points, or 0.76%, and a 18.61% decline in average rate of interest earned on interest-bearing deposits with banks from 5.48% to 4.46%. The average loan to deposit ratio decreased to 89.38% from 93.74% compared to the same quarter of 2024. Non-cash accretion income totaled $1.39 thousand for the first nine months of 2025 compared to $ 2.04 million reported in the same period of 2024.
Previous wording
Three*-*Month Comparison. The provision charged to operations decreased $429 thousand, or 297.92%, in the second quarter of 2025 compared to the same quarter of 2024. There was a recovery of provision for credit losses for loans of $292 thousand was recorded in the second quarter of 2025 compared to the provision of $449 thousand recorded in the same period of 2024. The decrease in provision was primarily due to a decrease in the balance of the loan portfolio, as well as a decrease in net charge-offs. There was a provision recorded for the allowance for unfunded commitments during the second quarter of 2025 of $7 thousand. A recovery of provision for the allowance for unfunded commitments was recorded during the second quarter of 2024, in the amount of $305 thousand.
Current wording
Three*-*Month Comparison. No provision for credit losses for loans was recorded in the third quarter of 2025 compared to a provision of $1.36 million recorded in the same period of 2024. The decrease in provision was primarily attributable to a decrease in the balance of the loan portfolio, as well as a decrease in non-performing loans. There was no provision for unfunded commitments recorded during the third quarter of 2025 or 2024.
Previous wording
Six-Month Comparison. The provision charged to operations decreased $1.12 million, or 96.88%, in the six months ending June 30, 2025 compared to the same quarter of 2024. Provision for credit losses for loans of $58 thousand was recorded in the six months ending June 30, 2025 compared to the provision of $1.46 million recorded in the same period of 2024. As noted above, the decrease was primarily due to a decrease in the balance of loan portfolio, as well as a decrease in net charge-offs. There was a recovery of provision for the allowance for unfunded commitments during the first six months of 2025 of $22 thousand. Compared to a recovery of provision for unfunded commitments of $305 thousand during the first six months of 2024.
Current wording
Nine-Month Comparison. The provision charged to operations decreased $2.48 million, or 98.57%, in the nine months ending September 30, 2025, compared to the same quarter of 2024. A provision for credit losses for loans of $36 thousand was recorded in the nine months ending September 30, 2025 compared to a provision of $2.52 million recorded in the same period of 2024. As noted above, the decrease was primarily due to a decrease in the balance of loan portfolio, as well as a decrease in non-performing loans. A provision for the allowance for unfunded commitments of $22 thousand was recorded during the first nine months of 2025 compared to a provision of $305 thousand during the same time period of 2024.
Previous wording
Three*-*Month Comparison. Noninterest income comprised 25.22% of total net interest and noninterest income in the second quarter of 2025 compared to 22.65% in the same quarter of 2024. Noninterest income increased $998 thousand or 10.68%. The increase is primarily attributable to an increase in service charges on deposits of $692 thousand, or 20.19%.
Current wording
Three*-*Month Comparison. Noninterest income comprised 25.81% of total net interest and noninterest income in the third quarter of 2025 compared to 24.86% in the same quarter of 2024. Noninterest income increased $437 thousand or 4.18%, compared to the same period of 2024. The increase is primarily attributable to an increase in wealth management fees of $300 thousand, or 28.01% and service charges on deposits of $859 thousand, or 23.46%.
Previous wording
Six-Month Comparison. Noninterest income comprised 25.23% of total net interest and noninterest income in the six months ending June 30, 2025 compared to 22.64% in the same quarter of 2024. Noninterest income increased $1.97 million or 10.58%. The increase is primarily attributable to an increase in service charges on deposits of $1.22 million, or 18.08%, and an increase in other operating income of $518 thousand, or 20.08%.
Current wording
Nine-Month Comparison. Noninterest income comprised 25.43% of total net interest and noninterest income in the nine months ending September 30, 2025 compared to 23.39% in the same quarter of 2024. Noninterest income increased $2.41 million or 8.28%, compared to the same period in 2024. The increase is primarily attributable to an increase in service charges on deposits of $2.08 million, or 19.97%, and an increase in wealth management fees of $521 thousand, or 16.11%.
Previous wording
Three*-*Month Comparison. Noninterest expense increased $558 thousand, or 2.24%, in the second quarter of 2025 compared to the same quarter of 2024. The increase was primarily due to an increase in salaries and employee benefits of $1.86 million, or 14.87%.
Current wording
Three*-*Month Comparison. Noninterest expense increased $2.10 million, or 8.69%, in the third quarter of 2025 compared to the same quarter of 2024. The increase was primarily due to an increase in salaries and employee benefits of $1.22 million, or 9.31% and merger expense of $787 thousand.
Previous wording
Six-Month Comparison. Noninterest expense increased $2.12 million, or 4.38%, in the six months ending June 30, 2025 compared to the same quarter of 2024. The largest increases were primarily due to increases in salaries and employee benefits of $2.61 million, or 10.42%, and other operating expense of $622 thousand, or 9.73%.
Current wording
Nine-Month Comparison. Noninterest expense increased $4.22 million, or 5.82%, in the nine months ending September 30, 2025 compared to the same quarter of 2024. The largest increase is primarily due to increases in salaries and employee benefits of $3.83 million, or 10.04%.
Previous wording
The Company’s effective tax rate, income tax as a percent of pre-tax income, may vary significantly from the statutory rate due to permanent differences and available tax credits. Permanent differences are income and expense items excluded by law in the calculation of taxable income. The Company’s most significant permanent differences generally include interest income on municipal securities and increases in the cash surrender value of life insurance policies.
Current wording
The Company’s effective tax rate, income tax as a percent of pre-tax income, may vary significantly from the statutory rate due to permanent differences and available tax credits. Permanent differences are income and expense items excluded by law in the calculation of taxable income. The Company’s most significant permanent differences generally include interest income on municipal securities, increase in the cash surrender value of life insurance policies and non-deductible acquisition costs.
Previous wording
Three-Month Comparison. Income tax expense increased $54 thousand, or 1.53%. The effective tax rate increased to 22.63% in the second quarter of 2025 from 21.75% in the same quarter of 2024.
Current wording
Three-Month Comparison. Income tax expense increased $165 thousand, or 4.75%. The effective tax rate increased to 22.89% in the third quarter of 2025 from 21.06% in the same quarter of 2024.
Previous wording
Six-Month Comparison. Income tax expense decreased $148 thousand, or 2.06%. The decrease is primarily due to the decrease in net income before taxes. The effective tax rate increased to 22.60% in the six months ending June 30, 2025 from 21.93% in the same quarter of 2024.
Current wording
Nine-Month Comparison. Income tax expense increased $17 thousand, or 0.16%. The increase is primarily due to an increase of the effective tax rate to 22.70% in the nine months ending September 30, 2025 from 21.64% in the same quarter of 2024.
Previous wording
Total assets as of June 30, 2025, decreased $80.20 million, or 2.46%, from December 31, 2024. The decrease in assets was primarily driven by decreases in the loans and securities available-for-sale portfolios. Total liabilities decreased $56.64 million, or 2.07%, and was primarily driven by a decrease in deposits. Stockholders' equity decreased $23.56 million, or 4.48%.
Current wording
Total assets as of September 30, 2025, decreased $71.60 million, or 2.20%, from December 31, 2024. The decrease in assets was primarily attributable to decreases in loan and securities available-for-sale portfolios. Total liabilities decreased $55.94 million, or 2.05%, and was primarily driven by a decrease in deposits of 60.65 million, or 2.25%. Stockholders' equity decreased $15.67 million, or 2.98%.
Previous wording
Available-for-sale debt securities as of June 30, 2025, decreased $37.31 million, or 21.97%, compared to December 31, 2024. The decrease is primarily due to the maturities and calls of securities of $90.45 million during the first six months of 2025 offset by purchases of $50.11 million. The market value of debt securities available-for-sale as a percentage of amortized cost was 91.52% as of June 30, 2025, compared to 91.97% as of December 31, 2024.
Current wording
Available-for-sale debt securities as of September 30, 2025, decreased $38.54 million, or 22.69%, compared to December 31, 2024. The decrease is primarily due to the maturities and calls of securities of $103 million during the first nine months of 2025 offset by purchases of $60 million. The market value of debt securities available-for-sale as a percentage of amortized cost was 92.34% as of September 30, 2025, compared to 91.97% as of December 31, 2024.
Previous wording
Total loans as of June 30, 2025, decreased $62.81 million, or 2.60%, compared to December 31, 2024. The largest decrease occurred in the commercial loans segment with an overall decrease of $27.18 million, or 1.72%. Within this segment, the largest decreases occurred in non-farm, non-residential loans, single family non-owner occupied, and multi-family residential loans with decreases of $11.58 million, $10.55 million, and $10.25 million, respectively. These decreases were offset by an increase in commercial and industrial loans of $16.82 million. The consumer real estate segment decreased $20.72 million, or 2.78%, primarily due to a decrease in single family owner occupied of $15.41 million, or 2.37%.
Current wording
Total loans as of September 30, 2025, decreased $84.78 million, or 3.51%, compared to December 31, 2024. The largest decrease occurred in the commercial loans segment with an overall decrease of $38.11 million, or 2.41%. Within this segment, the largest decreases occurred in non-farm/non-residential loans, single family non-owner occupied, and construction/development and other land development with decreases of $20.60 million, $16.29 million, and $9.14 million, respectively. These decreases were offset by an increase in commercial and industrial loans of $20.90 million. The consumer real estate segment decreased $24.33 million, or 3.27%, primarily due to a decrease in single family owner occupied of $17.60 million, or 2.71%.
Previous wording
Nonperforming assets as of June 30, 2025, decreased $1.43 million, or 6.97%, from December 31, 2024. Nonaccrual loans decreased $1.79 million, or 8.98%. OREO decreased $66 thousand, or 12.67%. In addition, accruing loans past due 90 days or more increased $419 thousand from year-end. As of June 30, 2025, nonaccrual loans were largely attributed to single family owner occupied (45.37%), non-farm, non-residential (14.19%), and single family non-owner occupied of (9.39%). Certain loans included in the nonaccrual category have been written down to estimated realizable value or assigned specific reserves in the allowance for credit losses based on management’s estimate of loss at ultimate resolution.
Current wording
Nonperforming assets as of September 30, 2025, decreased $3.64 million, or 17.70%, from December 31, 2024. Nonaccrual loans decreased $3.36 million, or 16.89%. OREO decreased $257 thousand, or 49.33%. In addition, accruing loans past due 90 days or more decreased $24 thousand from year-end. As of September 30, 2025, nonaccrual loans were largely attributed to single family owner occupied (50.58%), non-farm, non-residential (11.91%), and commercial and industrial of (9.36%). Certain loans included in the nonaccrual category have been written down to estimated realizable value or assigned specific reserves in the allowance for credit losses based on management’s estimate of loss at ultimate resolution.
Previous wording
Delinquent loans, comprised of loans 30 days or more past due and nonaccrual loans, totaled $28.92 million as of June 30, 2025, a decrease of $8.62 million, or 22.98%, compared to $37.55 million as of December 31, 2024. Delinquent loans as a percent of total loans totaled 1.23% as of June 30, 2025, which includes past due loans (0.46%) and nonaccrual loans (0.77%).
Current wording
Delinquent loans, comprised of loans 30 days or more past due and nonaccrual loans, totaled $27.19 million as of September 30, 2025, a decrease of $10.36 million, or 27.59%, compared to $37.55 million as of December 31, 2024. Delinquent loans as a percent of total loans totaled 1.17% as of September 30, 2025, which includes past due loans (0.46%) and nonaccrual loans (0.71%).
Previous wording
When restructuring loans for borrowers experiencing financial difficulty, we generally make concessions with respect to interest rates, loan terms, or amortization terms. Total loans modified as of June 30, 2025, were $2.13 million. As of June 30, 2025, $322 thousand of these loans were 30-89 days past due. Modified loans past due 90 days or more totaled $58 thousand and are included in the total for nonaccrual loans.
Current wording
When restructuring loans for borrowers experiencing financial difficulty, we generally make concessions with respect to interest rates, loan terms, or amortization terms. Total loans modified as of September 30, 2025, were $2.29 million. As of September 30, 2025, $213 thousand of these loans were 30-89 days past due. Modified loans past due 90 days or more totaled $165 thousand and are included in the total for nonaccrual loans.
Previous wording
OREO, which is carried at the lesser of estimated net realizable value or cost, decreased $66 thousand, or 12.67%, as of June 30, 2025, from December 31, 2024, and consisted of 5 properties with an average holding period of approximately 9 months. The net loss on the sale of OREO totaled $93 thousand for the six months ended June 30, 2025, compared to a net loss of $32 thousand for the same period of the prior year. The following table presents the changes in OREO during the periods indicated:
Current wording
OREO, which is carried at the lesser of estimated net realizable value or cost, decreased $257 thousand, or 49.33%, as of September 30, 2025, from December 31, 2024, and consisted of 4 properties with an average holding period of approximately 14 months. The net loss on the sale of OREO totaled $4 thousand for the nine months ended September 30, 2025, compared to a net loss of $29 thousand for the same period of the prior year. The following table presents the changes in OREO during the periods indicated:
Previous wording
At June 30, 2025, the Company also had an allowance for unfunded commitments of $319 thousand which was recorded in Other Liabilities on the Balance Sheet. During the first six months of 2025, the Company recorded a recovery of provision for credit losses for loan commitments of $22 thousand There was a recovery of provision of $305 thousand recorded in the same period of 2024.
Current wording
As of September 30, 2025, the Company also had an allowance for unfunded commitments of $319 thousand which was recorded in Other Liabilities on the Balance Sheet. During the first nine months of 2025, the Company recorded a recovery of provision for credit losses for loan commitments of $22 thousand. There was a recovery of provision of $305 thousand recorded in the same period of 2024.
Previous wording
Total deposits as of June 30, 2025, decreased $55.88 million, or 2.08%, compared to December 31, 2024. The largest decreases in deposits occurred in interest-bearing demand of $26.18 million, or 3.88%, time deposits of $18.42 million, or 7.66%, and noninterest-bearing demand deposits of $9.82 million or 1.11%.
Current wording
Total deposits as of September 30, 2025, decreased $60.65 million, or 2.25%, compared to December 31, 2024. The largest decreases occurred in time deposits of $34.08 million, or 14.17%, interest-bearing demand deposits of $20.51 million, or 3.04% and noninterest-bearing demand deposits of $17.95 million or 2.03%. These decreases were offset by an increase in savings deposits of $11.89 million, or 1.33%.
Previous wording
Total borrowings in the form of retail repurchase agreements as of June 30, 2025, increased $110 thousand, or 12.14%, compared to December 31, 2024.
Current wording
Total borrowings in the form of retail repurchase agreements as of September 30, 2025, increased $523 thousand, or 57.73%, compared to December 31, 2024.
Previous wording
As a financial holding company, the Company’s primary source of liquidity is dividends received from the Bank, which are subject to certain regulatory limitations. Other sources of liquidity include cash, investment securities, and borrowings. As of June 30, 2025, the Company’s cash reserves and short-term investment securities totaled $395.06 million and $10.91 million, respectively. The Company’s cash reserves and investments provide adequate working capital to meet obligations for the next twelve months.
Current wording
As a financial holding company, the Company’s primary source of liquidity is dividends received from the Bank, which are subject to certain regulatory limitations. Other sources of liquidity include cash, investment securities, and borrowings. As of September 30, 2025, the Company’s cash reserves and short-term investment securities totaled $30.31 million and $10.92 million, respectively. The Company’s cash reserves and investments provide adequate working capital to meet obligations for the next twelve months.
Previous wording
In addition to cash on hand and deposits with other financial institutions, we rely on customer deposits, cash flows from loans and investment securities, and lines of credit from the FHLB and the Federal Reserve Bank (“FRB”) Discount Window to meet potential liquidity demands. These sources of liquidity are immediately available to satisfy deposit withdrawals, customer credit needs, and our operations. Secondary sources of liquidity include approved lines of credit with correspondent banks and unpledged available-for-sale securities. As of June 30, 2025, our unencumbered cash totaled $395.06 million, unused borrowing capacity from the FHLB totaled $326.43 million, available credit from the FRB Discount Window totaled $5.84 million, available lines from correspondent banks totaled $100.00 million, and unpledged available-for-sale securities totaled $104.22 million.
Current wording
In addition to cash on hand and deposits with other financial institutions, we rely on customer deposits, cash flows from loans and investment securities, and lines of credit from the FHLB and the Federal Reserve Bank (“FRB”) Discount Window to meet potential liquidity demands. These sources of liquidity are immediately available to satisfy deposit withdrawals, customer credit needs, and our operations. Secondary sources of liquidity include approved lines of credit with correspondent banks and unpledged available-for-sale securities. As of September 30, 2025, our unencumbered cash totaled $427.71 million, unused borrowing capacity from the FHLB totaled $313.58 million, available credit from the FRB Discount Window totaled $5.86 million, available lines from correspondent banks totaled $100.00 million, and unpledged available-for-sale securities totaled $102.66 million.
Previous wording
We are committed to effectively managing our capital to protect our depositors, creditors, and shareholders. Failure to meet certain capital requirements may result in actions by regulatory agencies that could have a material impact on our operations. Total stockholders’ equity as of June 30, 2025, decreased $23.56 million, or 4.48%, to $502.83 million from $526.39 million as of December 31, 2024. The decrease in capital is primarily attributable to the payment of the special cash dividend in the first quarter of 2025 of $2.07 per share totaling approximately $37.93 million in addition to the regular cash dividends paid in first and second quarter of $0.31 per share. The decrease was offset by net income of $24.06 million. Book value per share at June 30, 2025, was $27.46 compared to $28.73 at year-end 2024.
Current wording
We are committed to effectively managing our capital to protect our depositors, creditors, and shareholders. Failure to meet certain capital requirements may result in actions by regulatory agencies that could have a material impact on our operations. Total stockholders’ equity as of September 30, 2025, decreased $15.67 million, or 2.98%, to $510.73 million from $526.39 million as of December 31, 2024. The decrease in capital is primarily attributable to the payment of the special cash dividend in the first quarter of 2025 of $2.07 per share totaling approximately $37.93 million in addition to the regular cash dividends paid in first and second quarter of $0.31 per share. The decrease was offset by net income of $36.33 million. Book value per share on September 30, 2025, was $27.89 compared to $28.73 at year-end 2024.
Previous wording
As of June 30, 2025, the Federal Open Market Committee had set the benchmark federal funds rate to a range of 425 to 450 basis points. The following table presents the sensitivity of net interest income from immediate and sustained rate shocks in various interest rate scenarios over a twelve-month period for the periods indicated:
Current wording
As of September 30, 2025, the Federal Open Market Committee had set the benchmark federal funds rate to a range of 400 to 425 basis points. The following table presents the sensitivity of net interest income from immediate and sustained rate shocks in various interest rate scenarios over a twelve-month period for the periods indicated: