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OAKLAND, Md., April 21, 2025 /PRNewswire/ -- First United Corporation (the "Corporation, "we", "us", and "our") (NASDAQ: FUNC), a bank holding company and the parent company of First United Bank & Trust (the "Bank"), today announced financial results for the three-month period ended March 31, 2025. Consolidated net income was $5.8 million for the first quarter of 2025, or $0.89 per diluted share, compared to $3.7 million, or $0.56 per diluted share, for the first quarter of 2024 and $6.2 million, or $0.95 per diluted share, for the fourth quarter of 2024. Annualized Return on Average Assets and Return on Average Equity were 1.19% and 12.83%, respectively.
According to Carissa Rodeheaver, Chairman, President and CEO, "We are very pleased with the first quarter results as we saw margin expansion, solid fee income and controlled expenses. Loan production was moderate during the quarter as many borrowers sit on the sidelines waiting for more certainty in the economic and political environments. Funding remains a challenge as inflation has taken its toll resulting in higher spending and reduced deposit balances while competition remains high. We are optimistic about the remainder of 2025 as we position ourselves for future growth and focus on an improved customer experience. We intend to invest in strategic hires and enhanced technology, particularly around the electronic banking experience, which will result in higher salaries and benefits and data processing expenses over the course of this year. However, we expect other expenses to be consistent with this quarter on a forward basis. Our solid performance is attributable to our dedicated associates as they assist our customers through these volatile times."
First Quarter Financial Highlights:
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Net interest margin, on a non-GAAP, fully tax equivalent ("FTE") basis, was 3.56% for the first quarter of 2025, reflecting increased loan yields and stable funding costs.
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Modest loan production, with $36.1 million in commercial loan originations and $11.4 million in residential mortgage originations in the first quarter.
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Provision expense was $0.7 million in the first quarter, driven by stable asset quality and improved qualitative factors, partially offset by the uncertainty of current economic conditions.
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Deposits increased by $48.7 million, which included $50.0 million in new brokered deposits obtained to repay $50.0 million in overnight borrowings outstanding at December 31, 2024.
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Operating income, including net gains, decreased by $0.1 million when compared to the linked quarter.
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Operating expenses increased by $0.5 million when compared to the linked quarter.
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A cash dividend of $0.22 per common share was declared in the first quarter.
Income Statement Overview
On a GAAP basis, net income for the first quarter of 2025 was $5.8 million. This compares to $6.2 million in the fourth quarter of 2024 and $3.7 million in the first quarter of 2024.
| | Q1 2025 | Q4 2024 | Q1 2024 |
| Net Income, non-GAAP (millions) | $ 5.8 | $ 6.2 | $4.1 |
| Net Income, GAAP (millions) | $ 5.8 | $ 6.2 | $ 3.7 |
| Diluted net income per share, non-GAAP | $ 0.89 | $ 0.95 | $ 0.62 |
| Diluted net income per share, GAAP | $ 0.89 | $ 0.95 | $ 0.56 |
The $2.1 million increase in quarterly net income when compared to the first quarter of 2024 was primarily driven by a $2.2 million increase in net interest income, a $0.3 million decrease in provision for credit loss, stable non-interest income, and a decrease in non-interest expense of $0.3 million, partially offset by an increase in income tax expense of $0.7 million. Comparing the first quarter of 2025 to the same period of 2024, interest and fees on loans increased by $2.5 million resulting from new loans booked at higher rates, the repricing of adjustable-rate loans, and growth in our loan portfolio. Interest expense remained stable when comparing year-over-year quarterly expense as reductions in the rate environment offset the increased funding. Other operating income was stable, and other operating expenses decreased by $0.3 million driven by a $0.6 million decrease in occupancy and equipment expense related to the accelerated depreciation and lease expenses for the branch closures in the first quarter of 2024, and a $0.2 million decrease in other pension benefits expense. These decreases were partially offset by a $0.2 million increase in salaries and benefits, an increase of $0.2 million in data processing expenses, and increases in other expenses such as miscellaneous loan fees and marketing expenses.
Compared to the linked quarter, net income decreased by $0.4 million due primarily to a $0.5 million increase in other operating expenses driven by a $0.9 million increase in salaries and employee benefit expenses due to a reversal of incentive payments in the fourth quarter of 2024 based on slower growth than originally budgeted, increased health insurance claims, and increased occupancy and equipment expenses of $0.2 million, partially offset by decreases in other expenses such as data processing, miscellaneous loan fees, and other pension benefits expenses. Net interest income increased by $0.3 million due to a $0.3 million increase in interest income and stable interest expense.
Net Interest Income and Net Interest Margin
Net interest income, on a non-GAAP, FTE basis, increased by $2.2 million for the first quarter of 2025 when compared to the first quarter of 2024. This increase was driven by an increase of $2.2 million in interest income. Interest income on loans increased by $2.5 million due to the increase of 46 basis points in overall yield on the loan portfolio as new loans were booked at higher rates during 2024, upward repricing of adjustable-rate loans, and an increase in average balances of $75.3 million. Interest income on Federal funds sold decreased by $0.4 million due to a decrease of 105 basis points in average rates and a decrease of $22.1 million in average balances. Interest expense in the first quarter of 2025 was stable when compared to the first quarter of 2024. Interest expense paid on deposits increased by $0.4 million due to a $141.1 million increase in average balances, partially offset by a decrease of 12 basis points on the rate paid. Interest paid on short-term borrowings decreased by $0.4 million for the first quarter of 2025 when compared to the same period of 2024 due to the repayment of the $40.0 million from the Bank Term Funding Program ("BTFP") late in the third quarter of 2024.
Comparing the first quarter of 2025 to the fourth quarter of 2024, net interest income, on a non-GAAP, FTE basis, increased by $0.3 million. This increase was driven by a $0.3 million increase in interest income resulting from a $0.5 million increase in interest and fees on loans, an increase in average loan balances of $30.8 million, and an 11 basis point increase in average yield. This increase was partially offset by a $0.2 million decrease in interest earned on Federal funds sold due to $14.8 million in reduced balances and a 69 basis point reduction in average yield. Interest expense was stable when comparing the first quarter of 2025 to the linked quarter. Interest expense on deposits increased slightly by $0.1 million due to an increase of $39.7 million in average balances and a 2 basis point decrease in average yields.
Non-Interest Income
Other operating income, including net gains, for the first quarter of 2025 was stable when compared to the same period of 2024. Wealth management income increased by $0.1 million due to increased market values and growth in new and existing customer relationships. This was offset by a decrease in brokerage commissions due to slower annuity sales comparing these quarters.
On a linked quarter basis, other operating income, including net gains, decreased by $0.1 million. Debit card income decreased by $0.2 million due to an annual incentive payment received in the fourth quarter of 2024. Wealth management income increased by $0.1 million due to increased brokerage commissions in the first quarter of 2025.
Non-Interest Expense
Operating expenses decreased by $0.3 million in the first quarter of 2025 when compared to the first quarter of 2024. The decrease was largely driven by a $0.6 million decrease in equipment and occupancy expense due to the accelerated depreciation expenses recognized in the first quarter of 2024 in conjunction with the branch closures in February 2024. This decrease was partially offset by a $0.2 million increase in salaries and benefits primarily driven by increases in incentive pay and life and health insurance expenses due to increased claims. Additionally, data processing expenses increased by $0.2 million in the first quarter of 2025 when compared to the first quarter of 2024, partially offset by a decrease in other miscellaneous expenses of $0.1 million due primarily to reduced net periodic pension costs and check fraud related costs.
Operating expenses increased by $0.5 million for the first quarter of 2025 when compared to the linked quarter. Salaries and employee benefits increased by $0.9 million due to a reversal of incentive payments in the fourth quarter of 2024 based on slower growth than originally budgeted, increased health insurance expenses due to increased claims, and equipment and occupancy expenses increased $0.2 million. Occupancy expenses increased quarter over quarter due to a credit in the fourth quarter of 2024 for a leased space exited in 2024 which was later reimbursed by the landlord. These increases were partially offset by a decrease in professional services of $0.1 million, a decrease in data processing expenses of $0.2 million, a decrease in miscellaneous loan fees of $0.1 million, and a decrease in other miscellaneous expenses of $0.2 million.
The effective income tax rates as a percentage of income for the three-month periods ended March 31, 2025 and March 31, 2024 were 24.6% and 23.9%, respectively.
Balance Sheet Overview
Total assets at March 31, 2025 were $2.0 billion, representing a $6.7 million increase since December 31, 2024. During the first quarter of 2025, cash and interest-bearing deposits in other banks increased by $6.1 million. The investment portfolio increased by $5.2 million as bonds were purchased to gain yield before long-term rates decline. Gross loans decreased slightly by $0.9 million. While loan production was modest during the quarter, amortization and payoffs exceeded growth levels. Pension assets decreased by $1.8 million due to decreased market values.
Total liabilities at March 31, 2025 were $1.8 billion, representing a $2.3 million increase since December 31, 2024. Total deposits increased by $48.7 million when compared to December 31, 2024 related primarily to the $50.0 million in new brokered deposits that were obtained in January 2025 to fund the repayment of the $50.0 million in overnight borrowings outstanding at December 31, 2024. Savings and money market accounts increased by $18.7 million and retail time deposits increased by $2.2 million. Interest-bearing demand deposits, primarily our ICS product, decreased by $17.9 million and non-interest-bearing deposits decreased by $4.3 million due primarily to seasonal fluctuations in municipal deposit accounts and increased spending by businesses and consumers related to inflation, respectively. Short-term borrowings decreased by $45.1 million primarily due to the repayment of $50.0 million in overnight borrowings outstanding at December 31, 2024, partially offset by increases in balances of the overnight investment sweep product.
Outstanding loans of $1.5 billion at March 31, 2025 reflected a $0.9 decrease since December 31, 2024.
| Loan Type (in millions) | | Change since |
| Commercial | | $0.0 |
| Residential Mortgages | | $1.3 |
| Consumer | | ($2.2) |
Since December 31, 2024, commercial real estate loans increased by $6.4 million, acquisition and development loans decreased by $1.2 million, commercial and industrial loans decreased by $5.2 million, residential mortgage loans increased $1.3 million, and consumer loans decreased by $2.2 million.
While loan production in the first quarter was modest, offset by amortization and payoffs, we are still working towards an 8% increase in loans. This growth could be tempered depending on the outcome of the current political uncertainties. New commercial loan production for the three months ended March 31, 2025 was approximately $36.1 million. However, the pipeline of commercial loans as of March 31, 2025 was $56.0 million and unfunded, committed commercial construction loans totaled approximately $41.7 million. Commercial amortization and payoffs were approximately $35.0 million through March 31, 2025, due primarily to pay-offs of short-term commercial loans as well as normal amortizations of the commercial loan portfolio.
New consumer mortgage loan production for the first quarter of 2025 was approximately $11.4 million, with most of this production comprised of in-house mortgages. The pipeline of in-house, portfolio loans as of March 31, 2025 was $10.9 million. Unfunded commitments related to residential construction loans totaled $9.8 million at March 31, 2025.
Total deposits at March 31, 2025 increased by $48.7 million when compared to December 31, 2024.
| Deposit Type (in millions) | | Change since |
| Non-Interest-Bearing | | ($4.3) |
| Interest-Bearing Demand | | ($17.9) |
| Savings and Money Market | | $18.7 |
| Time Deposits- Brokered | | $50.0 |
| Time Deposits- Retail | | $2.2 |
| Total Deposits | | $48.7 |
In January 2025, $50.0 million in brokered time deposits with an average interest rate of 4.24% were obtained to fund the repayment of $50.0 million in overnight borrowings that were outstanding at December 31, 2024. Savings and money market accounts increased by $18.7 million due primarily to the expansion of current and new relationships throughout the first three months of 2025. Non-interest-bearing checking deposits decreased by $4.3 million and interest-bearing checking deposits decreased by $17.9 million due primarily to seasonal fluctuations in municipal and commercial account balances and increased spending by businesses and consumers related to inflation. Retail time deposits increased by $2.2 million since December 31, 2024.
The book value of the Corporation's common stock was $28.35 per share at March 31, 2025 compared to $27.71 per share at December 31, 2024. At March 31, 2025, there were 6,478,634 basic outstanding shares and 6,657,239 diluted outstanding shares of common stock. The increase in the book value at March 31, 2025 was due to the undistributed net income of $4.4 million for the first quarter of 2025.
Asset Quality
The allowance for credit losses ("ACL") was $18.5 million at March 31, 2025 compared to $18.0 million recorded at March 31, 2024 and $18.2 million at December 31, 2024. The provision for credit losses was $0.7 million for the quarter ended March 31, 2025 compared to $0.9 million for the quarter ended March 31, 2024 and $0.5 million for the fourth quarter of 2024. The decreased provision expense recorded in the first quarter of 2025 when compared to the same period in 2024 was primarily related to the $12.1 million in commercial loan balances moved to non-accrual in the first quarter of 2024. Asset quality remained strong during the first quarter of 2025. Net charge-offs of $0.4 million were recorded for the quarter ended March 31, 2025 compared to net charge-offs of $0.5 million for the quarter ended March 31, 2024. The ratio of the ACL to loans outstanding was 1.25% at March 31, 2025 compared to 1.23% at December 31, 2024 and 1.27% at March 31, 2024. Management feels it is important to maintain the ACL given the uncertainties in the economic and political environments.
The ratio of net charge offs to average loans was 0.10% for the quarter ended March 31, 2025, and 0.13% for the quarter ended March 31, 2024. The commercial and industrial portfolio had net charge offs of 0.50% and 0.12% for the quarters ended March 31, 2025 and 2024, respectively. This increase resulted from the charge off of equipment loan balances on one commercial restaurant relationship during the first quarter of 2025 due to depressed liquidation prices of the equipment. The decrease in net charge offs in consumer loans in the first quarter of 2025 was primarily driven by approximately $0.3 million in charge offs of demand deposit balances during the first quarter of 2024. Details of the ratios, by loan type, are shown below. Our special assets team continues to actively collect on charged-off loans, resulting in overall low net charge-off ratios.
| Ratio of Net (Charge Offs)/Recoveries to Average Loans | ||
| | 3/31/2025 | 3/31/2024 |
| Loan Type | (Charge Off) / Recovery | (Charge Off) / Recovery |
| Commercial Real Estate | 0.00 % | 0.03 % |
| Acquisition & Development | 0.26 % | 0.01 % |
| Commercial & Industrial | (0.50 %) | (0.12 %) |
| Residential Mortgage | 0.01 % | 0.01 % |
| Consumer | (0.65 %) | (2.89 %) |
| Total Net (Charge Offs)/Recoveries | (0.10 %) | (0.13 %) |
Non-accrual loans totaled $4.0 million at March 31, 2025 compared to $4.9 million at December 31, 2024. The decrease in non-accrual balances at March 31, 2025 was related to principal reductions.
Non-accrual loans that have been subject to partial charge-offs totaled $0.7 million at both March 31, 2025 and December 31, 2024. There were no loans secured by 1-4 family residential real estate properties in the process of foreclosure at March 31, 2025. Loans secured by 1-4 family residential real estate properties in the process of foreclosure totaled $1.6 million at December 31, 2024. As a percentage of the loan portfolio, accruing loans past due 30 days or more was 0.42% at March 31, 2025 compared to 0.32% at December 31, 2024 and 0.40% as of March 31, 2024. The increase in the past due loans at March 31, 2025 was associated with one customer who experienced unexpected delays and cost overruns during construction of a multi-family project, thus causing cash flow disruption.
ABOUT FIRST UNITED CORPORATION
First United Corporation is a Maryland corporation chartered in 1985 and a financial holding company registered with the Board of Governors of the Federal Reserve System under the Bank Holding Company Act of 1956, as amended, that elected financial holding company status in 2021. The Corporation's primary business is serving as the parent company of the Bank, First United Statutory Trust I ("Trust I") and First United Statutory Trust II ("Trust II" and together with Trust I, "the Trusts"), both Connecticut statutory business trusts. The Trusts were formed for the purpose of selling trust preferred securities that qualified as Tier 1 capital. The Bank has two consumer finance company subsidiaries- Oak First Loan Center, Inc., a West Virginia corporation, and OakFirst Loan Center, LLC, a Maryland limited liability company – and two subsidiaries that it uses to hold real estate acquired through foreclosure or by deed in lieu of foreclosure – First OREO Trust, a Maryland statutory trust, and FUBT OREO I, LLC, a Maryland limited liability company. In addition, the Bank owns 99.9% of the limited partnership interests in Liberty Mews Limited Partnership, a Maryland limited partnership formed for the purpose of acquiring, developing and operating low-income housing units in Garrett County, Maryland, and a 99.9% non-voting membership interest in MCC FUBT Fund, LLC, an Ohio limited liability company formed for the purpose of acquiring, developing and operating low-income housing units in Allegany County, Maryland (the "MCC Fund"). The Corporation's website is www.mybank.com.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements do not represent historical facts, but are statements about management's beliefs, plans and objectives about the future, as well as its assumptions and judgments concerning such beliefs, plans and objectives. These statements are evidenced by terms such as "anticipate," "estimate," "should," "expect," "believe," "intend," and similar expressions. Although these statements reflect management's good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. The beliefs, plans and objectives on which forward-looking statements are based involve risks and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements. For a discussion of these risks and uncertainties, see the section of the periodic reports that First United Corporation files with the Securities and Exchange Commission entitled "Risk Factors". In addition, investors should understand that the Corporation is required under generally accepted accounting principles to evaluate subsequent events through the filing of the consolidated financial statements included in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 and the impact that any such events have on our critical accounting assumptions and estimates made as of March 31, 2025, which could require us to make adjustments to the amounts reflected in this press release.
| FIRST UNITED CORPORATION | ||||||
| Oakland, MD | ||||||
| Stock Symbol : FUNC | ||||||
| Financial Highlights - Unaudited | ||||||
| | ||||||
| (Dollars in thousands, except per share data) | | | | | ||
| | | | Three Months Ended | |||
| | | | March 31, | | March 31, | |
| | | | 2025 | | 2024 | |
| Results of Operations: | | | | | ||
| | Interest income | | $ 24,062 | | $ 21,898 | |
| | Interest expense | | 8,046 | | 8,086 | |
| | Net interest income | | 16,016 | | 13,812 | |
| | Provision for credit losses | | 656 | | 946 | |
| | Other operating income | | 4,822 | | 4,793 | |
| | Net gains | | 92 | | 82 | |
| | Other operating expense | | 12,576 | | 12,881 | |
| | Income before taxes | | $ 7,698 | | $ 4,860 | |
| | Income tax expense | | 1,892 | | 1,162 | |
| | Net income | | $ 5,806 | | $ 3,698 | |
| | | | | | | |
| Per share data: | | | | | ||
| | Basic net income per share | | $ 0.90 | | $ 0.56 | |
| | Diluted net income per share | | $ 0.89 | | $ 0.56 | |
| | Adjusted Basic net income (1) | | $ 0.90 | | $ 0.62 | |
| | Adjusted Diluted net income (1) | | $ 0.89 | | $ 0.62 | |
| | Dividends declared per share | | $ 0.22 | | $ 0.20 | |
| | Book value | | $ 28.35 | | $ 24.89 | |
| | Diluted book value | | $ 28.27 | | $ 24.86 | |
| | Tangible book value per share | | $ 26.55 | | $ 23.08 | |
| | Diluted Tangible book value per share | | $ 26.47 | | $ 23.05 | |
| | | | | | | |
| | Closing market value | | $ 30.02 | | $ 22.91 | |
| | Market Range: | | | | | |
| | High | | $ 41.61 | | $ 23.85 | |
| | Low | | $ 29.38 | | $ 21.21 | |
| | | | | | | |
| Shares outstanding at period end: Basic | | 6,478,634 | | 6,648,645 | ||
| Shares outstanding at period end: Diluted | | 6,497,454 | | 6,657,239 | ||
| | | | | | ||
| Performance ratios: (Year to Date Period End, annualized) | | | | | ||
| Return on average assets | | 1.19 % | | 0.76 % | ||
| Adjusted return on average assets | | 1.19 % | | 0.78 % | ||
| Return on average shareholders' equity | | 12.83 % | | 9.07 % | ||
| Adjusted return on average shareholders' equity | | 12.83 % | | 9.33 % | ||
| Net interest margin (Non-GAAP), includes tax exempt income of $49 and $57 | | 3.56 % | | 3.12 % | ||
| Net interest margin GAAP | | 3.55 % | | 3.10 % | ||
| Efficiency ratio - non-GAAP (1) | | 59.95 % | | 65.71 % | ||
| | | | | | ||
| (1) Efficiency ratio is a non-GAAP measure calculated by dividing total operating expenses by the sum of tax equivalent net interest income and other operating income, less gains/(losses) on sales of securities and/or fixed assets. | | March 31, | | December 31 | ||
| | | 2025 | | 2024 | ||
| Financial Condition at period end: | | | | | ||
| Assets | | $ 1,979,753 | | $ 1,973,022 | ||
| Earning assets | | $ 1,762,891 | | $ 1,758,665 | ||
| Gross loans | | $ 1,479,869 | | $ 1,480,793 | ||
| | Commercial Real Estate | | $ 532,764 | | $ 526,364 | |
| | Acquisition and Development | | $ 94,063 | | $ 95,314 | |
| | Commercial and Industrial | | $ 282,370 | | $ 287,534 | |
| | Residential Mortgage | | $ 520,072 | | $ 518,815 | |
| | Consumer | | $ 50,600 | | $ 52,766 | |
| Investment securities | | $ 275,143 | | $ 269,991 | ||
| Total deposits | | $ 1,623,574 | | $ 1,574,829 | ||
| | Noninterest bearing | | $ 422,415 | | $ 426,737 | |
| | Interest bearing | | $ 1,201,159 | | $ 1,148,092 | |
| Shareholders' equity | | $ 183,694 | | $ 179,295 | ||
| | | . | | | ||
| | | | | | ||
| Capital ratios: | | | | | ||
| | | | | | ||
| | Tier 1 to risk weighted assets | | 14.87 % | | 14.70 % | |
| | Common Equity Tier 1 to risk weighted assets | | 12.97 % | | 12.79 % | |
| | Tier 1 Leverage | | 11.94 % | | 11.88 % | |
| | Total risk based capital | | 16.10 % | | 15.92 % | |
| | | | | | | |
| Asset quality: | | | | | ||
| | | | | | ||
| Net charge-offs for the quarter | | $ (360) | | $ (362) | ||
| Nonperforming assets: (Period End) | | | | | ||
| | Nonaccrual loans | | $ 4,026 | | $ 4,931 | |
| | Loans 90 days past due and accruing | | 233 | | 918 | |
| | | | | | | |
| | Total nonperforming loans and 90 day past due | | $ 4,259 | | $ 5,849 | |
| | | | | | | |
| | Other real estate owned | | $ 3,062 | | $ 3,062 | |
| | Other repossessed assets | | $ 2,802 | | $ 2,802 | |
| | Modified loans | | $ 1,021 | | $ 1,006 | |
| | | | | | | |
| Allowance for credit losses to gross loans | | 1.25 % | | 1.23 % | ||
| Allowance for credit losses to non-accrual loans | | 458.69 % | | 368.49 % | ||
| Allowance for credit losses to non-performing assets | | 182.43 % | | 155.13 % | ||
| Non-performing and 90 day past due loans to total loans | | 0.29 % | | 0.39 % | ||
| Non-performing loans and 90 day past due loans to total assets | | 0.22 % | | 0.30 % | ||
| Non-accrual loans to total loans | | 0.27 % | | 0.33 % | ||
| Non-performing assets to total assets | | 0.51 % | | 0.59 % | ||
| FIRST UNITED CORPORATION | ||||||||
| Oakland, MD | ||||||||
| Stock Symbol : FUNC | ||||||||
| Financial Highlights - Unaudited | ||||||||
| | ||||||||
| | ||||||||
| | | | | | ||||
| | March 31, | December 31, | September 30, | June 30, | March 31, | | ||
| (Dollars in thousands, except per share data) | 2025 | 2024 | 2024 | 2024 | 2024 | | ||
| Results of Operations: | | | | | | | ||
| | Interest income | $ 24,062 | $ 23,725 | $ 23,257 | $ 23,113 | $ 21,898 | | |
| | Interest expense | 8,046 | 8,025 | 8,029 | 7,875 | 8,086 | | |
| | Net interest income | 16,016 | 15,700 | 15,228 | 15,238 | 13,812 | | |
| | Provision for credit losses | 656 | 529 | 264 | 1,194 | 946 | | |
| | Other operating income | 4,822 | 4,924 | 4,912 | 4,782 | 4,793 | | |
| | Net gains | 92 | 132 | 141 | 59 | 82 | | |
| | Other operating expense | 12,576 | 12,081 | 12,314 | 12,364 | 12,881 | | |
| | Income before taxes | $ 7,698 | $ 8,146 | $ 7,703 | $ 6,521 | $ 4,860 | | |
| | Income tax expense | 1,892 | 1,960 | 1,932 | 1,607 | 1,162 | | |
| | Net income | $ 5,806 | $ 6,186 | $ 5,771 | $ 4,914 | $ 3,698 | | |
| | | | | | | | | |
| Per share data: | | | | | | | ||
| | Basic net income per share | $ 0.90 | $ 0.95 | $ 0.89 | $ 0.75 | $ 0.56 | | |
| | Diluted net income per share | $ 0.89 | $ 0.95 | $ 0.89 | $ 0.75 | $ 0.56 | | |
| | Adjusted basic net income (1) | $ 0.90 | $ 0.95 | $ 0.89 | $ 0.75 | $ 0.62 | | |
| | Adjusted diluted net income (1) | $ 0.89 | $ 0.95 | $ 0.89 | $ 0.75 | $ 0.62 | | |
| | Dividends declared per share | $ 0.22 | $ 0.22 | $ 0.22 | $ 0.22 | $ 0.20 | | |
| | Book value | $ 28.35 | $ 27.71 | $ 26.90 | $ 25.39 | $ 24.89 | | |
| | Diluted book value | $ 28.27 | $ 27.65 | $ 26.84 | $ 25.34 | $ 24.86 | | |
| | Tangible book value per share | $ 26.55 | $ 25.89 | $ 25.06 | $ 23.55 | $ 23.08 | | |
| | Diluted Tangible book value per share | $ 26.47 | $ 25.83 | $ 25.01 | $ 23.49 | $ 23.05 | | |
| | | | | | | | | |
| | Closing market value | $ 30.02 | $ 33.71 | $ 29.84 | $ 20.42 | $ 22.91 | | |
| | Market Range: | | | | | | | |
| | High | $ 41.61 | $ 36.17 | $ 30.77 | $ 22.88 | $ 23.85 | | |
| | Low | $ 29.38 | $ 29.63 | $ 20.40 | $ 19.40 | $ 21.21 | | |
| | | | | | | | | |
| Shares outstanding at period end: Basic | 6,478,634 | 6,471,096 | 6,468,625 | 6,465,601 | 6,648,645 | | ||
| Shares outstanding at period end: Diluted | 6,497,454 | 6,485,119 | 6,482,648 | 6,479,624 | 6,657,239 | | ||
| | | | | | | | ||
| Performance ratios: (Year to Date Period End, annualized) | | | | | | | ||
| Return on average assets | 1.19 % | 1.06 % | 0.99 % | 0.89 % | 0.76 % | | ||
| Adjusted return on average assets (1) | 1.19 % | 1.08 % | 1.01 % | 0.98 % | 0.85 % | | ||
| Return on average shareholders' equity | 12.83 % | 12.16 % | 11.52 % | 10.48 % | 9.07 % | | ||
| Adjusted return on average shareholders' equity (1) | 12.83 % | 12.42 % | 11.78 % | 11.52 % | 10.11 % | | ||
| Net interest margin (Non-GAAP), includes tax exempt income of $49 and $57 | 3.56 % | 3.38 % | 3.34 % | 3.31 % | 3.12 % | | ||
| Net interest margin GAAP | 3.55 % | 3.36 % | 3.32 % | 3.29 % | 3.10 % | | ||
| Efficiency ratio - non-GAAP (1) | 59.95 % | 61.31 % | 62.46 % | 63.48 % | 65.71 % | | ||
| | | | | | | | ||
| (1) Efficiency ratio is a non-GAAP measure calculated by dividing total operating expenses by the sum of tax equivalent net interest income and other operating income, less gains/(losses) on sales of securities and/or fixed assets. | March 31, | December 31, | September 30, | June 30, | March 31, | | ||
| | 2025 | 2024 | 2024 | 2024 | 2024 | | ||
| Financial Condition at period end: | | | | | | | ||
| Assets | $ 1,979,753 | $ 1,973,022 | $ 1,916,126 | $ 1,868,599 | $ 1,912,953 | | ||
| Earning assets | $ 1,762,891 | $ 1,758,665 | $ 1,722,346 | $ 1,695,425 | $ 1,695,962 | | ||
| Gross loans | $ 1,479,869 | $ 1,480,793 | $ 1,447,883 | $ 1,422,975 | $ 1,412,327 | | ||
| | Commercial Real Estate | $ 532,764 | $ 526,364 | $ 502,828 | $ 506,273 | $ 492,819 | | |
| | Acquisition and Development | $ 94,063 | $ 95,314 | $ 92,909 | $ 88,215 | $ 83,424 | | |
| | Commercial and Industrial | $ 282,370 | $ 287,534 | $ 277,994 | $ 260,168 | $ 274,722 | | |
| | Residential Mortgage | $ 520,072 | $ 518,815 | $ 519,168 | $ 511,354 | $ 501,990 | | |
| | Consumer | $ 50,600 | $ 52,766 | $ 54,984 | $ 56,965 | $ 59,372 | | |
| Investment securities | $ 275,143 | $ 269,991 | $ 267,214 | $ 267,151 | $ 278,716 | | ||
| Total deposits | $ 1,623,574 | $ 1,574,829 | $ 1,540,395 | $ 1,537,071 | $ 1,563,453 | | ||
| | Noninterest bearing | $ 422,415 | $ 426,737 | $ 419,437 | $ 423,970 | $ 422,759 | | |
| | Interest bearing | $ 1,201,159 | $ 1,148,092 | $ 1,120,958 | $ 1,113,101 | $ 1,140,694 | | |
| Shareholders' equity | $ 183,694 | $ 179,295 | $ 173,979 | $ 164,177 | $ 165,481 | | ||
| | | | | | | | ||
| Capital ratios: | | | | | | | ||
| | | | | | | | ||
| | Tier 1 to risk weighted assets | 14.87 % | 14.70 % | 14.61 % | 14.51 % | 14.58 % | | |
| | Common Equity Tier 1 to risk weighted assets | 12.97 % | 12.79 % | 12.66 % | 12.54 % | 12.60 % | | |
| | Tier 1 Leverage | 11.94 % | 11.88 % | 11.88 % | 11.69 % | 11.48 % | | |
| | Total risk based capital | 16.10 % | 15.92 % | 15.83 % | 15.75 % | 15.83 % | | |
| | | | | | | | | |
| Asset quality: | | | | | | | ||
| | | | | | | | ||
| Net (charge-offs)/recoveries for the quarter | $ (360) | $ (362) | $ (109) | $ (1,309) | $ (459) | | ||
| Nonperforming assets: (Period End) | | | | | | | ||
| | Nonaccrual loans | $ 4,026 | $ 4,931 | $ 8,073 | $ 9,438 | $ 16,007 | | |
| | Loans 90 days past due and accruing | 233 | 918 | 538 | 526 | 120 | | |
| | | | | | | | | |
| | Total nonperforming loans and 90 day past due | $ 4,259 | $ 5,849 | $ 8,611 | $ 9,964 | $ 16,127 | | |
| | | | | | | | | |
| | Other real estate owned | $ 3,062 | $ 3,062 | $ 2,860 | $ 2,978 | $ 4,402 | | |
| | Other repossessed assets | $ 2,802 | $ 2,802 | $ 42 | $ 32 | $ 68 | | |
| | Modified/restructured loans | $ 1,021 | $ 1,006 | $ 1,016 | $ 893 | $ - | | |
| | | | | | | | | |
| Allowance for credit losses to gross loans | 1.25 % | 1.23 % | 1.24 % | 1.26 % | 1.27 % | | ||
| Allowance for credit losses to non-accrual loans | 458.69 % | 368.49 % | 223.09 % | 189.90 % | 112.34 % | | ||
| Allowance for credit losses to non-performing assets | 182.43 % | 155.13 % | 157.00 % | 138.49 % | 87.59 % | | ||
| Non-performing and 90 day past due loans to total loans | 0.29 % | 0.39 % | 0.59 % | 0.70 % | 1.14 % | | ||
| Non-performing loans and 90 day past due loans to total assets | 0.22 % | 0.30 % | 0.45 % | 0.53 % | 0.84 % | | ||
| Non-accrual loans to total loans | 0.27 % | 0.33 % | 0.56 % | 0.66 % | 1.13 % | | ||
| Non-performing assets to total assets | 0.51 % | 0.59 % | 0.60 % | 0.69 % | 1.07 % | | ||
| Consolidated Statement of Condition | | | | |
| | | | | |
| (Dollars in thousands - Unaudited) | | March 31, | | December 31, |
| | | | | |
| Assets | | | | |
| Cash and due from banks | $ | 82,813 | $ | 77,020 |
| Interest bearing deposits in banks | | 1,618 | | 1,307 |
| Cash and cash equivalents | | 84,431 | | 78,327 |
| Investment securities – available for sale (at fair value) | | 99,998 | | 94,494 |
| Investment securities – held to maturity (at cost) | | 174,144 | | 175,497 |
| Equity investments with readily determinable fair market values | | 1,001 | | — |
| Restricted investment in bank stock, at cost | | 5,815 | | 5,768 |
| Loans held for sale | | — | | 806 |
| Loans | | 1,479,869 | | 1,480,793 |
| Unearned fees | | (457) | | (442) |
| Allowance for credit losses | | (18,467) | | (18,170) |
| Net loans | | 1,460,945 | | 1,462,181 |
| Premises and equipment, net | | 30,010 | | 30,081 |
| Goodwill and other intangible assets | | 11,691 | | 11,773 |
| Bank owned life insurance | | 49,293 | | 48,952 |
| Deferred tax assets | | 10,021 | | 9,989 |
| Other real estate owned, net | | 3,062 | | 3,062 |
| Operating lease asset | | 1,131 | | 1,204 |
| Pension asset | | 16,064 | | 17,824 |
| Accrued interest receivable and other assets | | 32,147 | | 33,064 |
| Total Assets | $ | 1,979,753 | $ | 1,973,022 |
| Liabilities and Shareholders' Equity | | | | |
| Liabilities: | | | | |
| Non-interest bearing deposits | $ | 422,415 | $ | 426,737 |
| Interest bearing deposits | | 1,201,159 | | 1,148,092 |
| Total deposits | | 1,623,574 | | 1,574,829 |
| Short-term borrowings | | 20,342 | | 65,409 |
| Long-term borrowings | | 120,929 | | 120,929 |
| Operating lease liability | | 1,308 | | 1,384 |
| Allowance for credit loss on off balance sheet exposures | | 863 | | 863 |
| Accrued interest payable and other liabilities | | 27,617 | | 28,889 |
| Dividends payable | | 1,426 | | 1,424 |
| Total Liabilities | | 1,796,059 | | 1,793,727 |
| Shareholders' Equity: | | | | |
| Common Stock – par value $0.01 per share; Authorized 25,000,000 shares; issued and outstanding 6,6478,634 shares at March 31, 2025 and 6,471,096 at December 31, 2024 | | 65 | | 65 |
| Surplus | | 20,606 | | 20,476 |
| Retained earnings | | 193,382 | | 189,002 |
| Accumulated other comprehensive loss | | (30,359) | | (30,248) |
| Total Shareholders' Equity | | 183,694 | | 179,295 |
| Total Liabilities and Shareholders' Equity | $ | 1,979,753 | $ | 1,973,022 |
| Historical Income Statement | | | | | | | | | | |
| | | | | |||||||
| | | 2025 | | 2024 | ||||||
| | | Q1 | | Q4 | | Q3 | Q2 | Q1 | ||
| In thousands | (Unaudited) | |||||||||
| Interest income | | | | | | | | | | |
| Interest and fees on loans | $ | 21,755 | $ | 21,299 | $ | 21,018 | $ | 20,221 | $ | 19,218 |
| Interest on investment securities | | | | | | | | | | |
| Taxable | | 1,763 | | 1,672 | | 1,647 | | 1,697 | | 1,744 |
| Exempt from federal income tax | | 45 | | 47 | | 56 | | 53 | | 53 |
| Total investment income | | 1,808 | | 1,719 | | 1,703 | | 1,750 | | 1,797 |
| Other | | 499 | | 707 | | 536 | | 1,142 | | 883 |
| Total interest income | | 24,062 | | 23,725 | | 23,257 | | 23,113 | | 21,898 |
| Interest expense | | | | | | | | | | |
| Interest on deposits | | 6,683 | | 6,585 | | 6,579 | | 6,398 | | 6,266 |
| Interest on short-term borrowings | | 20 | | 40 | | 467 | | 509 | | 461 |
| Interest on long-term borrowings | | 1,343 | | 1,400 | | 983 | | 968 | | 1,359 |
| Total interest expense | | 8,046 | | 8,025 | | 8,029 | | 7,875 | | 8,086 |
| Net interest income | | 16,016 | | 15,700 | | 15,228 | | 15,238 | | 13,812 |
| Credit loss expense/(credit) | | | | | | | | | | |
| Loans | | 657 | | 522 | | 195 | | 1,251 | | 961 |
| Debt securities held to maturity | | — | | — | | 14 | | — | | — |
| Off balance sheet credit exposures | | (1) | | 7 | | 55 | | (57) | | (15) |
| Provision for credit losses | | 656 | | 529 | | 264 | | 1,194 | | 946 |
| Net interest income after provision for credit losses | | 15,360 | | 15,171 | | 14,964 | | 14,044 | | 12,866 |
| Other operating income | | | | | | | | | | |
| Gains on sale of residential mortgage loans | | 92 | | 132 | | 141 | | 59 | | 82 |
| Net gains/(losses) | | 92 | | 132 | | 141 | | 59 | | 82 |
| Other Income | | | | | | | | | | |
| Service charges on deposit accounts | | 547 | | 553 | | 555 | | 556 | | 556 |
| Other service charges | | 206 | | 211 | | 236 | | 225 | | 215 |
| Trust department | | 2,323 | | 2,323 | | 2,328 | | 2,255 | | 2,188 |
| Debit card income | | 921 | | 1,134 | | 1,000 | | 999 | | 932 |
| Bank owned life insurance | | 341 | | 345 | | 340 | | 334 | | 326 |
| Brokerage commissions | | 421 | | 295 | | 297 | | 362 | | 495 |
| Other | | 63 | | 63 | | 156 | | 51 | | 81 |
| Total other income | | 4,822 | | 4,924 | | 4,912 | | 4,782 | | 4,793 |
| Total other operating income | | 4,914 | | 5,056 | | 5,053 | | 4,841 | | 4,875 |
| Other operating expenses | | | | | | | | | | |
| Salaries and employee benefits | | 7,331 | | 6,456 | | 7,160 | | 7,256 | | 7,157 |
| FDIC premiums | | 245 | | 260 | | 256 | | 285 | | 269 |
| Equipment | | 578 | | 490 | | 627 | | 635 | | 923 |
| Occupancy | | 689 | | 563 | | 709 | | 652 | | 954 |
| Data processing | | 1,503 | | 1,688 | | 1,333 | | 1,422 | | 1,318 |
| Marketing | | 238 | | 205 | | 151 | | 184 | | 134 |
| Professional services | | 476 | | 536 | | 477 | | 449 | | 486 |
| Contract labor | | 163 | | 181 | | 149 | | 84 | | 183 |
| Telephone | | 98 | | 99 | | 97 | | 103 | | 109 |
| Other real estate owned | | 92 | | 47 | | 124 | | 14 | | 86 |
| Investor relations | | 62 | | 65 | | 84 | | 91 | | 53 |
| Contributions | | 56 | | 53 | | 65 | | 66 | | 50 |
| Other | | 1,045 | | 1,438 | | 1,082 | | 1,123 | | 1,159 |
| Total other operating expenses | | 12,576 | | 12,081 | | 12,314 | | 12,364 | | 12,881 |
| Income before income tax expense | | 7,698 | | 8,146 | | 7,703 | | 6,521 | | 4,860 |
| Provision for income tax expense | | 1,892 | | 1,960 | | 1,932 | | 1,607 | | 1,162 |
| Net Income | $ | 5,806 | $ | 6,186 | $ | 5,771 | $ | 4,914 | $ | 3,698 |
| Basic net income per common share | $ | 0.90 | $ | 0.95 | $ | 0.89 | $ | 0.75 | $ | 0.56 |
| Diluted net income per common share | $ | 0.89 | $ | 0.95 | $ | 0.89 | $ | 0.75 | $ | 0.56 |
| Weighted average number of basic shares outstanding | | 6,474 | | 6,470 | | 6,468 | | 6,527 | | 6,642 |
| Weighted average number of diluted shares outstanding | | 6,490 | | 6,484 | | 6,482 | | 6,537 | | 6,655 |
| Dividends declared per common share | $ | 0.22 | $ | 0.22 | $ | 0.22 | $ | 0.20 | $ | 0.20 |
| Non-GAAP Financial Measures (unaudited) | ||||||||
| Reconciliation of as reported (GAAP) and non-GAAP financial measures | ||||||||
| | ||||||||
| The following tables below provide a reconciliation of certain financial measures calculated under generally accepted accounting principles ("GAAP") (as reported) and non-GAAP. A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with GAAP in the United States. The Company's management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company's operating results in addition to the results measured in accordance with GAAP. While management uses these non-GAAP measures in its analysis of the Company's performance, this information should not be viewed as a substitute for financial results determined in accordance with GAAP or considered to be more important than financial results determined in accordance with GAAP. | ||||||||
| The following non-GAAP financial measures exclude accelerated depreciation expenses related to the branch closures. | ||||||||
| | | Three months ended March 31, | | | ||||
| | | 2025 | | 2024 | | | ||
| (in thousands, except for per share amount) | | | | | | | | |
| Net income - as reported | | $ | 5,806 | | $ | 3,698 | | |
| Adjustments: | | | | | | | | |
| Accelerated depreciation expenses | | | — | | | 562 | | |
| Income tax effect of adjustments | | | — | | | (137) | | |
| Adjusted net income (non-GAAP) | | $ | 5,806 | | $ | 4,123 | | |
| | | | | | | | | |
| Diluted earnings per share - as reported | | $ | 0.89 | | $ | 0.56 | | |
| Adjustments: | | | | | | | | |
| Accelerated depreciation expenses | | | — | | | 0.08 | | |
| Income tax effect of adjustments | | | — | | | (0.02) | | |
| Adjusted basic and diluted earnings per share (non-GAAP) | | $ | 0.89 | | $ | 0.62 | | |
| | | | | | | | | |
| | | | | | | | | |
| | | As of or for the three months ended | | | ||||
| | | March 31, | | | ||||
| (in thousands, except per share data) | | 2025 | | 2024 | | | ||
| Per Share Data | | | | | | | | |
| Basic net income per share - as reported | | $ | 0.90 | | $ | 0.56 | | |
| Basic net income per share - non-GAAP | | | 0.90 | | | 0.62 | | |
| Diluted net income per share - as reported | | $ | 0.89 | | $ | 0.56 | | |
| Diluted net income per share - non-GAAP | | | 0.89 | | | 0.62 | | |
| Basic book value per share | | $ | 28.40 | | $ | 24.89 | | |
| Diluted book value per share | | $ | 28.42 | | $ | 24.86 | | |
| | | | | | | | | |
| | | | | | | | | |
| Significant Ratios: | | | | | | | | |
| | | | | | | | | |
| Return on Average Assets - as reported | | | 1.19 % | | | 0.76 % | | |
| Accelerated depreciation expenses | | | - | | | 0.03 % | | |
| Income tax effect of adjustments | | | - | | | (0.01 %) | | |
| Adjusted Return on Average Assets (non-GAAP) | | | 1.19 % | | | 0.78 % | | |
| | | | | | | | | |
| Return on Average Equity - as reported | | | 12.83 % | | | 9.07 % | | |
| Accelerated depreciation expenses | | | - | | | 0.34 % | | |
| Income tax effect of adjustments | | | - | | | (0.08 %) | | |
| Adjusted Return on Average Equity (non-GAAP) | | | 12.83 % | | | 9.33 % | | |
| | | | | | | | | |
| (1) See reconcilation of this non-GAAP financial measure provided elsewhere herein. | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | Three Months Ended | | ||||||||||||||
| | | | March 31 | | ||||||||||||||
| | | | 2025 | | 2024 | | ||||||||||||
| | (dollars in thousands) | | Average | | Interest | | Average | | Average | | Interest | | Average | | ||||
| | Assets | | | | | | | | | | | | | | | | | |
| | Loans | | $ | 1,483,151 | | | 21,768 | | 5.95 | % | $ | 1,407,886 | | $ | 19,234 | | 5.49 | % |
| | Investment Securities: | | | | | | - | | | | | | | | | | | |
| | Taxable | | | 284,303 | | | 1,763 | | 2.51 | % | 294,526 | | | 1,744 | | 2.38 | % | |
| | Non taxable | | | 6,524 | | | 81 | | 5.04 | % | 7,806 | | | 94 | | 4.84 | % | |
| | Total | | | 290,827 | | | 1,844 | | 2.57 | % | | 302,332 | | | 1,838 | | 2.45 | % |
| | Federal funds sold | | | 41,750 | | | 384 | | 3.73 | % | 63,843 | | | 758 | | 4.78 | % | |
| | Interest-bearing deposits with other banks | | | 8,488 | | | 15 | | 0.72 | % | 8,787 | | | 31 | | 1.42 | % | |
| | Other interest earning assets | | | 5,774 | | | 100 | | 7.02 | % | 5,107 | | | 94 | | 7.40 | % | |
| | Total earning assets | | | 1,829,990 | | | 24,111 | | 5.34 | % | | 1,787,955 | | | 21,955 | | 4.94 | % |
| | Allowance for credit losses | | | (18,413) | | | | | | | | (17,696) | | | | | | |
| | Non-earning assets | | | 165,125 | | | | | | | | 188,425 | | | | | | |
| | Total Assets | | $ | 1,976,702 | | | | | | | $ | 1,958,684 | | | | | | |
| | Liabilities and Shareholders' Equity | | | | | | | | | | | | | | | | | |
| | Interest-bearing demand deposits | | $ | 373,903 | | $ | 1,652 | | 1.79 | % | $ | 348,998 | | $ | 1,441 | | 1.66 | % |
| | Interest-bearing money markets- retail | | | 464,151 | | | 3,547 | | 3.10 | % | 322,965 | | | 3,260 | | 4.06 | % | |
| | Interest-bearing money markets- brokered | | | 134 | | | 1 | | 3.03 | % | — | | | — | | — | % | |
| | Savings deposits | | | 171,517 | | | 43 | | 0.10 | % | 189,572 | | | 48 | | 0.10 | % | |
| | Time deposits - retail | | | 144,519 | | | 1,046 | | 2.94 | % | 157,678 | | | 1,118 | | 2.85 | % | |
| | Time deposits - brokered | | | 36,041 | | | 394 | | 4.43 | % | 30,000 | | | 399 | | 5.35 | % | |
| | Short-term borrowings | | | 23,053 | | | 20 | | 0.35 | % | 73,351 | | | 461 | | 2.53 | % | |
| | Long-term borrowings | | | 120,929 | | | 1,343 | | 4.50 | % | 103,017 | | | 1,359 | | 5.31 | % | |
| | Total interest-bearing liabilities | | | 1,334,247 | | | 8,046 | | 2.45 | % | | 1,225,581 | | | 8,086 | | 2.65 | % |
| | Non-interest-bearing deposits | | | 427,518 | | | | | | | | 534,413 | | | | | | |
| | Other liabilities | | | 31,474 | | | | | | | | 34,746 | | | | | | |
| | Shareholders' Equity | | | 183,463 | | | | | | | | 163,944 | | | | | | |
| | Total Liabilities and Shareholders' Equity | | $ | 1,976,702 | | | | | | | $ | 1,958,684 | | | | | | |
| | Net interest income and spread | | | | | $ | 16,065 | | 2.89 | % | | | $ | 13,869 | | 2.29 | % | |
| | Net interest margin | | | | | | | | 3.56 | % | | | | | | 3.12 | % | |
| | | | | | | | | | | | | | | | | | | |
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SOURCE First United Corporation