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PALOS VERDES ESTATES, Calif., July 12, 2024 (GLOBE NEWSWIRE) -- Malaga Financial Corporation “Company” (OTCPink:MLGF), the parent company of Malaga Bank FSB, today reported that net income for the six months ended June 30, 2024 was $11,791,000 ($1.31 basic and fully diluted earnings per share) compared to $11,469,000 ($1.28 basic and fully diluted earnings per share, as adjusted for the stock dividend declared on November 9, 2023) for the same period ended June 30, 2023, an increase of $322,000 or 3%. Net income for the quarter ended June 30, 2024 was $5,779,000 ($0.64 basic and fully diluted earnings per share), an increase of $185,000 or 3% from net income of $5,594,000 ($0.63 basic and fully diluted earnings per share, as adjusted for the stock dividend declared on November 9, 2023) for the quarter ended June 30, 2023. For the first six months of 2024, the Company’s annualized return on average equity was 11.73% and the annualized return on average assets was 1.62%.
The increase in earnings of $185,000 for the second quarter of 2024 compared to second quarter of 2023 was primarily attributed to a $170,000 increase in net interest income after provision for loan losses, a $60,000 decrease in other operating expense, and a $43,000 decrease in nonoperating expense offset by a $77,000 increase in income tax expense and an $11,000 decrease in other operating income.
Net interest income totaled $11,207,000 in the second quarter of 2024, an increase of $2,000 from the same period in 2023. This resulted primarily due to a decrease in average interest-earning assets of $61.9 million offset by an increase in the interest rate spread from 2.87% to 2.92%. The increase in the interest rate spread is primarily attributed to an increase of 0.49% in yield on average interest-earning assets offset by an increase of 0.44% in yield on average interest-bearing liabilities.
Operating expenses decreased 2% in the second quarter of 2024 to $3,448,000 from $3,508,000 in the second quarter of 2023. The decrease is primarily attributed to decreases in deposit insurance premium of $73,000 and general and administrative of $28,000 offset by increases in data processing of $23,000 and compensation of $10,000.
The Company had no 30-day delinquent loans or loans with deferred payments and no foreclosed real estate owned at June 30, 2024. The Company’s allowance for credit losses was $3,737,000, or 0.30% of total loans, at June 30, 2024.
Randy C. Bowers, Chairman, President, and CEO, commented, “We are pleased to report continued year-over-year earnings increases for the 2nd quarter and year-to-date 2024.This positive earnings trend along with excellent asset quality and tight expense control position us well for continued favorable performance for the remainder of the year. In spite of a very challenging operating environment, we are realistically optimistic going forward and wish to again thank our colleagues for their efforts in achieving these results.”