Fifth District Bancorp (FDSB) Q3 2024 earnings summary

Executive summary

• Completed mutual-to-stock conversion and IPO on July 31, 2024, raising $54.6 million in gross proceeds and issuing 5,559,473 shares.

• Net loss of $788,000 for Q3 2024 and $1.2 million for the nine months ended September 30, 2024, compared to net income of $39,000 and $619,000 for the same periods in 2023.

• Net loss driven by a $1.3 million charitable contribution to establish the Fifth District Community Foundation and a $1.1 million realized loss on securities sales.

• Total assets increased 9.0% to $523.8 million at September 30, 2024, primarily from higher cash and investment securities.

Financial highlights

• Interest and dividend income rose 25.0% year-over-year to $5.2 million for Q3 2024; net interest income up 22.5% to $2.9 million.

• Interest expense increased 28.2% to $2.3 million for Q3 2024, reflecting higher deposit costs.

• Net interest margin improved to 2.32% in Q3 2024 from 2.11% in Q3 2023; net interest rate spread was 1.91%.

• Noninterest expense rose 59.9% to $4.2 million in Q3 2024, mainly due to the charitable contribution and higher compensation.

• Noninterest income was $252,000 in Q3 2024, up 1.2% year-over-year; for the nine months, noninterest income was a loss of $231,000 due to securities sales.

• Allowance for credit losses on loans decreased to 0.46% of total loans at September 30, 2024, from 0.76% a year earlier, with a $1.1 million reversal in Q2 2024.

Outlook and guidance

• Management expects to maintain strong liquidity and capital positions, with sufficient funds to meet current commitments.

• Anticipates a significant portion of maturing time deposits will be retained; prepared to raise rates or use FHLB advances if needed.

• Continues to monitor interest rate risk and manage the investment portfolio to reduce average maturity.