FIRST RESOURCE BANCORP, INC. ANNOUNCES 2025 FIRST QUARTER RESULTS; NET INCOME GREW 27% OVER PRIOR YEAR, NET INTEREST MARGIN EXPANDS

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First Resource Bancorp (OTCQX: FRSB) reported strong Q1 2025 financial results, with net income reaching $1.7 million, up 27% year-over-year and 67% from the previous quarter. The bank achieved earnings per share of $0.56, a 30% increase from Q1 2024.

Key highlights include net interest margin expansion to 3.60%, total interest income growth of 16% year-over-year, and total deposits increasing by 4% during the quarter. The bank's total assets grew by $11.7 million to $675.3 million, while non-performing assets decreased to 0.04% from 0.19% in the previous quarter.

The loan portfolio expanded by 1% to $605.0 million, with growth in commercial business, construction, and consumer loans. Book value per share increased 4% to $17.34, and the company continued its stock repurchase program, buying back 9,248 shares at an average price of $14.62.

Positive

• Net income increased 27% year-over-year to $1.7 million
• Net interest margin expanded to 3.60%, up 10 basis points
• Total deposits grew 4% during Q1 2025
• Non-performing assets decreased significantly to 0.04% from 0.19%
• Book value per share increased 4% to $17.34

Negative

• $1.1 million in loan charge-offs during Q1 2025
• Slow 1% loan growth described as 'anomaly' by management
• Non-interest expenses increased 9% quarter-over-quarter
• 12% decrease in non-interest income year-over-year

EXTON, Pa., April 24, 2025 /PRNewswire/ -- First Resource Bancorp, Inc. (OTCQX: FRSB), the holding company for First Resource Bank, announced financial results for the three months ended March 31, 2025. 

Lauren C. Ranalli, President and CEO, stated, "First Resource Bancorp achieved record profitability in the first quarter of 2025, driven by an improved net interest margin and robust deposit growth. Our disciplined approach to loan and deposit pricing continues to strengthen our bottom line, while our superior level of customer service has fueled continued balance sheet expansion. We are excited to start the year on such a strong note and look forward to building on this momentum."

Highlights for the first quarter of 2025 included:

• Net income of $1.7 million exceeded the prior year by 27% and the prior quarter by 67%
• Net interest margin expanded 10 basis points over the prior quarter to 3.60%
• Total interest income grew 16% over the prior year first quarter
• Net interest income grew 19% over the prior year first quarter
• Earnings per share grew 30% over the prior year first quarter to $0.56 per share
• Total deposits grew 4% during the first quarter, or 16% annualized
• Book value per share grew 4% to $17.34 during the first quarter
• Total assets grew $11.7 million, or 2%, ending the quarter at $675.3 million
• Non-performing assets to total assets fell to 0.04% from 0.19% from the prior quarter

Ranalli added, "Our performance is driven not only by consistent growth, but also the upward repricing of loans originated during periods of historically low interest rates —a trend we expect to persist through the remainder of this year and into next. We also saw a decline in deposit costs compared to the previous quarter, while still achieving 4% deposit growth in the first quarter. Our strategic approach to rates has allowed us to steadily grow and quickly enhance our net interest margin."

Net income for the quarter ended March 31, 2025, totaled $1.7 million, or $0.56 per common share, marking a significant increase from $1.0 million, or $0.33 per share, in the previous quarter, and up from $1.3 million, or $0.43 per common share, in the same quarter of 2024. The annualized return on average assets rose to 1.06% for the first quarter of 2025, compared to 0.92% in the first quarter of 2024. Similarly, the annualized return on average equity also improved, reaching 13.31%, up from 11.39% during the same period last year. 

Total interest income was $9.7 million for the first quarter of 2025, a $95 thousand, or 1%, increase from the fourth quarter of 2024. This growth was fueled by a 1% increase in loans during the first quarter.

Total interest income increased by $1.4 million, marking a 16% increase from $8.4 million in the first quarter of 2024 to $9.7 million in the corresponding period of 2025. This growth was driven by a 10% year-over-year expansion in loans, complemented by an overall increase in loan yields. 

Total interest expense fell by 2% in the first quarter of 2025 compared to the fourth quarter of 2024. This decline was primarily driven by a 5 basis point reduction in the cost of money market accounts and a 24 basis point reduction in the cost of time deposits. These savings were partially offset by an increased volume of interest-bearing deposits. Additionally, interest expense on borrowings fell by 15%, resulting from a decrease in the average balance of overnight advances during the first quarter of 2025 compared to the fourth quarter of 2024.

Total interest expense increased by 13%, climbing from $3.7 million in the first quarter of 2024 to $4.2 million in the first quarter of 2025. This increase was primarily driven by greater volumes of interest-bearing deposits, partially offset by a 6 basis point decrease in the cost of interest-bearing deposits year-over-year. Interest expense on subordinated debt grew by 45%, while interest expense on borrowings declined by 27% when compared to the first quarter of 2024.

In the first quarter of 2025, net interest income grew by $163 thousand, or 3%, compared to the previous quarter. The net interest margin also increased to 3.60%, up from 3.50% for the fourth quarter of 2024. The overall yield on interest-earning assets rose by 5 basis points, primarily driven by a 5 basis point increase in loan yields to 6.47% for the quarter. Meanwhile, the cost of interest-bearing deposits dropped by 10 basis points to 3.39%, reflecting lower rates on money market and time deposit accounts, partially offset by increased volumes in those categories. As a result, the total cost of deposits fell by 4 basis points for the quarter, from 2.89% to 2.85%.

The provision for credit losses in the first quarter of 2025 was $174 thousand, down significantly from $1.1 million in the fourth quarter of 2024. The elevated provision in the previous quarter was primarily attributable to a $1.0 million specific reserve established for a non-accrual commercial loan relationship, and that amount was subsequently charged off during the first quarter of 2025. An additional $100 thousand charge-off for an unrelated commercial loan, brought the total charge-offs for the quarter to $1.1 million. Year over year, the provision for credit losses rose $110 thousand from $64 thousand in the first quarter of 2024 to $174 thousand in the first quarter of 2025. 

"The vast majority of the first quarter charge-offs had already been provided for through a specific reserve in the prior quarter, resulting in minimal impact on earnings this quarter," commented Ranalli. "Despite the charge-off decisions, we are actively pursuing all available collection options related to these loans."

As of March 31, 2025, the allowance for credit losses to total loans stood at 0.77%, down from 0.93% as of December 31, 2024. Non-performing assets consisted solely of non-performing loans, totaling $262 thousand as of March 31, 2025, a decrease from $1.3 million at the end of the prior quarter. There were no non-performing assets as of March 31, 2024. Non-performing assets to total assets stood at 0.04% at March 31, 2025, compared to 0.19% as of December 31, 2024, and 0.00% at March 31, 2024.

Non-interest income totaled $349 thousand in the first quarter of 2025, representing a 21% increase from $289 thousand in the previous quarter, and a 12% decrease from $396 thousand in the same quarter of the prior year. Notably, swap referral fee income contributed $24 thousand in the first quarter of 2025, compared to $31 thousand in the fourth quarter of 2024 and $182 thousand in the first quarter of 2024. Gains on the sale of SBA loans were $87 thousand in the first quarter of 2025, compared to an immaterial amount in the fourth quarter of 2024, and none in the first quarter of 2024.

Non-interest expenses increased $290 thousand, or 9%, in the first quarter of 2025 compared to the prior quarter. This increase was driven by higher salaries & employee benefits, professional fees, advertising, data processing, and other costs. However, these increases were partially offset by decreases in occupancy & equipment. 

Non-interest expenses increased $274 thousand, or 8%, in the first quarter of 2025 compared to the same period in 2024. This rise was driven by increases in all categories when comparing the first quarter of 2025 to the first quarter of 2024. The ratio of non-interest expenses to average assets was 2.25% in the first quarter of 2025, up from 2.07% in the previous quarter and down from 2.28% in the first quarter of the prior year.

Deposits for the first quarter experienced a net increase of $21.8 million, or 4%, rising from $552.2 million on December 31, 2024, to $574.0 million on March 31, 2025. Noninterest-bearing deposits rose by 8% in the first quarter, increasing $6.8 million to $93.4 million, up from $86.6 million in the previous quarter. Interest-bearing checking balances rose by $6.6 million, or 17%, to $46.8 million, up from $40.1 the prior quarter. Money market deposits grew $10.3 million, or 4%, rising from $239.8 million at the end of the fourth quarter of 2024, to $250.1 by the close of the first quarter of 2025. These gains were partially offset by a $2.0 million, or 1%, decline in time deposits, which fell from $185.7 million on December 31, 2024, to $183.7 million on March 31, 2025.

Between March 31, 2024, and March 31, 2025, total deposits grew 12%, driven by increases in interest-bearing checking accounts, money markets, and time deposits. This growth was partially offset by a decline in noninterest-bearing deposits. As of March 31, 2025, approximately 82% of total deposits were insured or otherwise collateralized, up from 81% in the prior quarter.

The loan portfolio expanded by $6.6 million, representing a 1% increase, from $598.5 million on December 31, 2024, to $605.0 million on March 31, 2025. Robust growth in commercial business, construction loans, and consumer loans was partially offset by a decrease in commercial real estate loans when comparing loan balances over the same period.

Ranalli noted, "Robust loan fundings in the first quarter were offset by several large loan payoffs. We consider the resulting relatively slow net loan growth in the first quarter to be an anomaly, with stronger growth expected for the remainder of the year."

Between March 31, 2024 and March 31, 2025, total loans expanded by 10%, with strong growth in all loan categories.

The following table illustrates the composition of the loan portfolio:

	Mar. 31, 2025		Dec. 31, 2024		Mar. 31, 2024
Commercial real estate	$   476,539,433		$   480,933,654		$   444,909,373
Commercial construction	46,800,635		39,760,197		35,337,226
Commercial business	63,018,850		59,862,802		51,780,407
Consumer	18,681,505		17,907,914		17,979,804
Total loans	$   605,040,423		$   598,464,567		$   550,006,810

 

Investment securities totaled $16.8 million on March 31, 2025, compared to $26.6 million on December 31, 2024. The held-to-maturity investment portfolio had a book value of $8.5 million and a fair market value of $7.5 million, resulting in an unrealized loss of $1.0 million, compared to an unrealized loss of $1.1 million at year-end 2024. After tax, this loss amounts to $799 thousand, representing approximately 1.5% of total equity as of March 31, 2025. The remainder of the investment portfolio was classified as available-for-sale, with a book value of $9.4 million and a fair value of $8.3 million, resulting in an unrealized loss of $1.1 million, compared to $1.2 million as of December 31, 2024. This unrealized loss, net of tax, totals $841 thousand and is reflected in accumulated other comprehensive loss on the balance sheet.

On August 12, 2024, the Company announced a stock repurchase program authorizing the repurchase of up to 155,922 shares of its common stock. During the quarter ended March 31, 2025, the Company repurchased 9,248 shares at a total cost of $136 thousand and an average price of $14.62 per share, a significant discount to book value per share of $17.34 at the end of the first quarter. As of March 31, 2025, 49,759 shares remained available for repurchase under the program.

Total stockholders' equity increased by $1.7 million, or 3%, rising from $50.3 million on December 31, 2024, to $52.0 million on March 31, 2025, largely driven by net income. During the quarter ended March 31, 2025, book value per share increased by 61 cents, or 4%, reaching $17.34.

Selected Financial Data: Consolidated Balance Sheets (unaudited)
	March 31, 2025		December 31, 2024
Cash and due from banks	$    32,001,499		$    17,837,920
Time deposits at other banks	100,000		100,000
Investments	16,832,703		26,611,867
Loans	605,040,423		598,464,567
Allowance for credit losses	(4,649,701)		(5,574,679)
Premises & equipment	7,612,821		7,551,410
Other assets	18,343,387		18,593,449
Total assets	$  675,281,132		$  663,584,534
Noninterest-bearing deposits	$    93,370,878		$    86,581,276
Interest-bearing checking	46,765,157		40,119,102
Money market	250,128,786		239,828,130
Time deposits	183,711,945		185,697,340
Total deposits	573,976,766		552,225,848
Short term borrowings	30,000,000		40,000,000
Long term borrowings	4,250,000		6,250,000
Subordinated debt	8,477,273		8,473,216
Other liabilities	6,574,889		6,341,010
Total liabilities	623,278,928		613,290,074
Common stock	3,100,773		3,100,773
Surplus	19,854,676		19,852,352
Treasury stock	(1,422,978)		(1,316,876)
Accumulated other comprehensive loss	(840,523)		(964,821)
Retained earnings	31,310,256		29,623,032
Total stockholders' equity	52,002,204		50,294,460
Total liabilities &      stockholders' equity	$  675,281,132		$  663,584,534

 

Performance Statistics (unaudited)
	Qtr Ended Mar. 31, 2025	Qtr Ended Dec. 31, 2024	Qtr Ended Sep. 30, 2024	Qtr Ended Jun. 30, 2024	Qtr Ended Mar. 31, 2024
Net interest margin	3.60 %	3.50 %	3.43 %	3.43 %	3.35 %
Nonperforming loans/    total loans	0.04 %	0.21 %	0.00 %	0.00 %	0.00 %
Nonperforming assets/    total assets	0.04 %	0.19 %	0.00 %	0.00 %	0.00 %
Allowance for credit losses/    total loans	0.77 %	0.93 %	0.76 %	0.77 %	0.80 %
Average loans/average    assets	93.0 %	93.2 %	92.9 %	92.7 %	92.4 %
Non-interest expenses*/    average assets	2.25 %	2.07 %	2.17 %	2.21 %	2.28 %
Efficiency ratio	61.0 %	58.3 %	62.3 %	63.3 %	65.5 %
Earnings per share – basic    and diluted	$0.56	$0.33	$0.53	$0.44	$0.43
Book value per share	$17.34	$16.73	$16.45	$15.78	$15.34
Total shares outstanding	2,998,977	3,006,039	3,004,689	3,098,431	3,096,138
Weighted average shares outstanding	3,003,194	3,005,408	3,055,157	3,097,433	3,094,951
*  Annualized

 

Consolidated Income Statements (unaudited)
	Qtr. Ended Mar. 31, 2025		Qtr. Ended Dec. 31, 2024		Qtr. Ended Sep. 30, 2024		Qtr. Ended Jun. 30, 2024		Qtr. Ended Mar. 31, 2024
INTEREST INCOME
Loans, including fees	$9,583,093		$9,512,689		$9,346,895		$8,859,695		$8,228,102
Securities	116,372		115,291		123,678		122,082		120,713
Other	47,421		24,256		25,135		34,964		31,735
Total interest income	9,746,886		9,652,236		9,495,708		9,016,741		8,380,550
INTEREST EXPENSE
Deposits	4,002,995		4,057,530		3,979,691		3,767,011		3,519,176
Borrowings	77,303		90,767		245,596		173,198		105,860
Subordinated debt	134,682		134,681		120,829		93,124		93,124
Total interest expense	4,214,980		4,282,978		4,346,116		4,033,333		3,718,160
Net interest income	5,531,906		5,369,258		5,149,592		4,983,408		4,662,390
Provision for credit losses	174,097		1,127,547		13,317		246,273		63,651
Net interest income after provision for credit losses	5,357,809		4,241,711		5,136,275		4,737,135		4,598,739
NON-INTEREST INCOME
Service charges and other fees	109,360		114,958		94,812		104,748		100,164
BOLI income	65,850		66,248		65,800		59,613		51,356
Gain on sale of SBA loans	86,860		(367)		59,296		-		-
Swap referral fee income	24,201		31,030		-		62,460		182,060
Other	62,843		77,225		65,944		64,085		62,548
Total non-interest income	349,114		289,094		285,852		290,906		396,128
NON-INTEREST EXPENSE
Salaries & benefits	2,127,037		1,948,007		1,999,957		1,944,755		2,045,083
Occupancy & equipment	334,698		336,629		368,339		362,850		289,202
Professional fees	150,176		109,819		128,748		130,767		137,482
Advertising	108,721		77,809		76,383		81,510		81,745
Data processing	204,492		201,671		189,429		180,257		176,685
Other	664,334		625,603		622,590		636,589		584,926
Total non-interest expense	3,589,458		3,299,538		3,385,446		3,336,728		3,315,123
Income before federal income tax expense	2,117,465		1,231,267		2,036,681		1,691,313		1,679,744
Federal income tax expense	430,241		223,486		413,607		342,880		348,807
Net income	$1,687,224		$1,007,781		$1,623,074		$1,348,433		$1,330,937

 

About First Resource Bancorp, Inc.

First Resource Bancorp, Inc. is the holding company of First Resource Bank. First Resource Bank is a locally owned and operated Pennsylvania state-chartered bank with three full-service branches, serving the banking needs of businesses, professionals and individuals in the Delaware Valley. The Bank offers a full range of deposit and credit services with a high level of personalized service. First Resource Bank also offers a broad range of traditional financial services and products, competitively priced and delivered in a responsive manner to small businesses, professionals and residents in the local market. For additional information visit our website at www.firstresourcebank.com. Member FDIC.

This press release contains statements that are not of historical facts and may pertain to future operating results or events or management's expectations regarding those results or events. These are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts. When used in this press release, the words "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates", or words of similar meaning, or future or conditional verbs, such as "will", "would", "should", "could", or "may" are generally intended to identify forward-looking statements. These forward-looking statements are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are either beyond our control or not reasonably capable of predicting at this time. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the results discussed in these forward-looking statements. Readers of this press release are accordingly cautioned not to place undue reliance on forward-looking statements. First Resource Bank disclaims any intent or obligation to update publicly any of the forward-looking statements herein, whether in response to new information, future events or otherwise.

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SOURCE First Resource Bank

FAQ

What was First Resource Bancorp's (FRSB) net income growth in Q1 2025?

FRSB's net income grew 27% year-over-year to $1.7 million in Q1 2025, and increased 67% compared to the previous quarter.

How much did FRSB's deposits grow in Q1 2025?

Total deposits grew 4% during Q1 2025 (16% annualized), reaching $574.0 million from $552.2 million in the previous quarter.

What was FRSB's earnings per share in Q1 2025?

FRSB reported earnings per share of $0.56 in Q1 2025, representing a 30% increase from $0.43 in Q1 2024.

How did FRSB's loan portfolio perform in Q1 2025?

The loan portfolio grew 1% to $605.0 million in Q1 2025, with growth in commercial business, construction, and consumer loans, while commercial real estate loans decreased.

What is FRSB's current book value per share?

FRSB's book value per share increased 4% to $17.34 as of March 31, 2025.