First Capital (FCAP) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $2.8 million ($0.85 per diluted share), up from $2.7 million ($0.82) in Q2 2023; six-month net income was $5.8 million ($1.73), down from $6.5 million ($1.95) year-over-year.

• Total assets increased by $5.7 million to $1.16 billion at June 30, 2024; net loans receivable rose $15.6 million to $630.0 million, while securities available for sale decreased $23.0 million to $414.3 million.

• Total deposits declined to $1.01 billion, with notable outflows in checking and savings accounts, partially offset by an increase in time deposits.

Financial highlights

• Net interest income after provision for credit losses increased $335,000 for Q2 2024 compared to Q2 2023; for the six months, it decreased $343,000 year-over-year.

• Total interest income for Q2 2024 was $12.2 million, up from $10.6 million in Q2 2023; six-month total was $24.1 million, up from $20.8 million.

• Total interest expense increased $1.3 million in Q2 and $3.5 million for the six months, reflecting higher average costs and balances of interest-bearing liabilities.

• Noninterest income grew by $160,000 in Q2 and $68,000 for the six months, mainly from higher gains on loan sales and other income.

• Noninterest expense rose $334,000 in Q2 and $690,000 for the six months, primarily due to higher compensation, professional fees, and other expenses.

Outlook and guidance

• Management expects continued competition for deposits and pressure on deposit costs due to high-rate alternatives and market conditions.

• Management cited macroeconomic uncertainty and increased nonperforming assets as factors in higher credit loss provisions.

• The Bank remains well-capitalized with a CBLR of 10.44% at June 30, 2024, and management believes all capital adequacy requirements are met.

• Forward-looking statements highlight risks from economic conditions, interest rates, competition, and regulatory changes.