First Reliance Bancshares Reports Third Quarter 2024 Results
FLORENCE, S.C., Oct. 24, 2024 /PRNewswire/ -- First Reliance Bancshares, Inc. (OTC:FSRL), the holding company for First Reliance Bank (collectively, "First Reliance" or the "Company"), today announced its financial results for the third quarter of 2024.
Third Quarter 2024 Highlights
Net income increased 26.4% for the third quarter of 2024 to $1.8 million, or $0.22 per diluted share, compared to $1.4 million, or $0.18 per diluted share, for the third quarter of 2023. Operating earnings, which excludes securities gains (losses), net of tax, was $2.0 million, or $0.24 per diluted share, for the third quarter of 2024, compared to $1.7 million, or $0.20 per diluted share, in the third quarter of 2023.
Book value per share increased $1.86, or 22.9%, from $8.12 per share at September 30, 2023, to $9.98 per share at September 30, 2024. Tangible book value per share increased $1.87, or 23.3%, from $8.02 per share at September 30, 2023, to $9.89 per share at September 30, 2024.
Net interest income for the quarter was $8.1 million, which represents an increase of $900,000, or 12.5%, compared to the same quarter one year ago. On a linked quarter basis, the increase was $438,000, or 5.7%.
Net interest margin increased during the quarter to 3.27% at September 30, 2024, compared to 3.20% at June 30, 2024, and increased 16 basis points compared to the same period in 2023.
The Company recorded securities losses of $162 thousand pre-tax in the third quarter of 2024 compared to $268 thousand pre-tax in third quarter of 2023. The after-tax impact of these securities losses was $125 thousand and $209 thousand, respectively.
Total loans held for investment decreased $214 thousand, or (0.12%) annualized, to $739.2 million at September 30, 2024, from $739.4 million at June 30, 2024.
Total deposits increased $52.1 million, or 23.2% annualized, to $951.9 million at September 30, 2024, from $899.8 million at June 30, 2024.
Asset quality remained steady with nonperforming assets totaling $924 thousand, or 0.09% of total assets at September 30, 2024, compared to $310 thousand, or 0.03% of total assets at June 30, 2024.
Cost of funds for the third quarter of 2024 decreased to 2.23% from 2.28% on a linked quarter basis and increased from 1.91% for the same period in 2023.
Rick Saunders, Chief Executive Officer, remarked: "The third quarter of 2024 provided some clarity relative to the economy and interest rates as the Fed began to lower interest rates. Our net interest margin improved seven basis points to 3.27%, expenses were flat from the second quarter of 2024, credit quality remained steady with low net charge offs and low nonperforming assets, and deposit growth totaled $52.1 million. Our loan to deposit ratio dropped below 80% (77.65%) for the first time since the first quarter of 2023. Tangible book value per share improved by $0.76 during the quarter with $0.51 per share being attributable to the lower unrealized losses in the securities portfolio."
Financial Summary
Three Months Ended
Nine Months Ended
Sep 30
Jun 30
Mar 31
Dec 31
Sep 30
Sep 30
Sep 30
($ in thousands, except per share data)
2024
2024
2024
2023
2023
2024
2023
Earnings:
Net income available to common shareholders
$ 1,825
$ 1,942
$ 1,238
$ 776
$ 1,444
$ 5,005
$ 3,828
Operating earnings (Non-GAAP)
1,950
1,942
1,238
1,424
1,653
5,130
4,398
Earnings per common share, diluted
0.22
0.24
0.15
0.10
0.18
0.61
0.47
Operating earnings, diluted (Non-GAAP)
0.24
0.24
0.15
0.17
0.20
0.63
0.54
Total revenue(1)
9,855
10,226
9,690
8,285
9,219
29,771
27,607
Net interest margin
3.27 %
3.20 %
3.11 %
3.16 %
3.11 %
3.20 %
3.20 %
Return on average assets(2)
0.69 %
0.75 %
0.49 %
0.32 %
0.58 %
0.65 %
0.52 %
Return on average equity(2)
9.60 %
10.69 %
7.01 %
4.70 %
8.68 %
9.16 %
7.77 %
Efficiency ratio(3)
76.90 %
75.21 %
81.04 %
89.83 %
80.35 %
77.67 %
80.66 %
As of
Sep 30
Jun 30
Mar 31
Dec 31
Sep 30
($ in thousands)
2024
2024
2024
2023
2023
Balance Sheet:
Total assets
$ 1,071,480
$ 1,058,395
$ 1,027,616
$ 974,157
$ 991,721
Total loans receivable
739,219
739,433
725,234
705,672
706,596
Total deposits
951,948
899,799
881,309
858,597
861,229
Total transaction deposits(4) to total deposits
38.82 %
39.18 %
39.86 %
41.31 %
43.55 %
Loans to deposits
77.65 %
82.18 %
82.29 %
82.19 %
82.05 %
Bank Capital Ratios:
Total risk-based capital ratio
13.56 %
13.34 %
13.46 %
13.86 %
13.54 %
Tier 1 risk-based capital ratio
12.51 %
12.28 %
12.37 %
12.75 %
12.43 %
Tier 1 leverage ratio
9.87 %
10.01 %
10.16 %
10.32 %
10.11 %
Common equity tier 1 capital ratio
12.51 %
12.28 %
12.37 %
12.75 %
12.43 %
Asset Quality Ratios:
Nonperforming assets as a percentage of total assets
0.09 %
0.03 %
0.03 %
0.03 %
0.05 %
Allowance for credit losses as a percentage of total loans receivable
1.13 %
1.15 %
1.17 %
1.19 %
1.19 %
Net charge-offs as a percentage of average total loans receivable
0.03 %
0.05 %
0.06 %
0.00 %
0.01 %
Footnotes to table located at the end of this release.
CONDENSED CONSOLIDATED INCOME STATEMENTS, Unaudited
Three Months Ended
Nine Months Ended
Sep 30
Jun 30
Mar 31
Dec 31
Sep 30
Sep 30
($ in thousands, except per share data)
2024
2024
2024
2023
2023
2024
2023
Interest income
Loans
$ 10,930
$ 10,746
$ 10,085
$ 9,678
$ 9,394
$ 31,761
$ 26,492
Investment securities
1,969
1,875
1,972
1,832
1,596
5,816
4,310
Other interest income
623
419
291
396
536
1,333
1,680
Total interest income
13,522
13,040
12,348
11,906
11,526
38,910
32,482
Interest expense
Deposits
4,833
4,652
4,332
4,076
3,671
13,817
8,470
Other interest expense
585
722
808
558
651
2,115
2,312
Total interest expense
5,418
5,374
5,140
4,634
4,322
15,932
10,782
Net interest income
8,104
7,666
7,208
7,272
7,204
22,978
21,700
Provision for credit losses
(83)
55
207
(118)
(42)
179
487
Net interest income after provision for loan losses
8,187
7,611
7,001
7,390
7,246
22,799
21,213
Noninterest income
Mortgage banking income
805
1,416
1,375
694
1,147
3,596
3,127
Service fees on deposit accounts
327
307
336
336
371
970
1,038
Debit card and other service charges, commissions, and fees
528
568
519
544
537
1,615
1,617
Income from bank owned life insurance
105
103
102
99
95
310
429
Loss on sale of securities, net
(162)
-
-
(802)
(268)
(162)
(723)
Gain on disposal of fixed assets
-
-
20
11
-
20
19
Other income
148
166
130
132
132
444
400
Total noninterest income
1,751
2,560
2,482
1,014
2,014
6,793
5,907
Noninterest expense
Compensation and benefits
4,682
4,693
4,878
4,558
4,603
14,253
13,716
Occupancy and equipment
848
837
841
798
882
2,526
2,630
Data processing, technology, and communications
994
1,119
1,039
985
923
3,152
2,796
Professional fees
265
96
110
56
58
471
364
Marketing
66
102
160
104
151
328
584
Other
723
844
826
942
790
2,393
2,177
Total noninterest expense
7,578
7,691
7,854
7,443
7,407
23,123
22,267
Income before provision for income taxes
2,360
2,480
1,629
961
1,853
6,469
4,853
Income tax expense
535
538
391
185
409
1,464
1,025
Net income available to common shareholders
$ 1,825
$ 1,942
$ 1,238
$ 776
$ 1,444
$ 5,005
$ 3,828
Add back securities losses, net of tax
125
-
-
648
209
125
570
Operating earnings (Non-GAAP)
$ 1,950
$ 1,942
$ 1,238
$ 1,424
$ 1,653
$ 5,130
$ 4,398
Weighted average common shares - basic
7,847
7,851
7,837
7,826
7,834
7,845
7,822
Weighted average common shares - diluted
8,221
8,260
8,217
8,164
8,149
8,255
8,161
Basic net income per common share
$ 0.23
$ 0.25
$ 0.16
$ 0.10
$ 0.18
$ 0.64
$ 0.49
Diluted net income per common share
$ 0.22
$ 0.24
$ 0.15
$ 0.10
$ 0.18
$ 0.61
$ 0.47
Operating earnings per common share (Non-GAAP)
$ 0.25
$ 0.25
$ 0.16
$ 0.18
$ 0.21
$ 0.66
$ 0.56
