Morris State Bancshares Announces Quarterly Earnings and Declares Second Quarter Dividend

Rhea-AI Summary

Morris State Bancshares (OTCQX: MBLU) reported Q1 2025 net income of $4.9 million, a slight increase of 0.45% from Q1 2024, but down 20.04% from Q4 2024's $6.1 million. The bank achieved loan growth of $23 million (2.12%), representing an annualized growth rate of 8.48%.

The net interest margin improved to 4.29% in Q1 2025, up from 4.17% in Q4 2024 and 3.99% in Q1 2024. Asset quality showed improvement with the adversely classified asset index declining to 4.66%. The decline in quarterly earnings was primarily attributed to higher income tax provisioning, increased CECL-related reserves, and higher salary expenses.

The board approved a Q2 2025 dividend of $0.12 per share. Total shareholders' equity increased 1.18% to $198 million, with tangible book value growing to $17.66.

Positive

• Net interest margin expanded to 4.29%, up from 4.17% in Q4 2024
• Loan growth of $23 million (2.12%) achieved in Q1 2025
• Asset quality improved with declining adversely classified asset index to 4.66%
• Total shareholders' equity increased 8.75% year-over-year to $198 million

Negative

• Net income decreased 20.04% quarter-over-quarter to $4.9 million
• Higher income tax provisioning due to expiration of solar project tax credits
• Increased CECL-related reserves for unfunded loan commitments
• Higher salary and benefits expenses impacting noninterest expense

DUBLIN, Ga., April 23, 2025 (GLOBE NEWSWIRE) -- Morris State Bancshares, Inc. (OTCQX: MBLU) (the “Company”), the parent of Morris Bank, today announced net income of $4.9 million for the quarter ending March 31, 2025, representing an increase of $22 thousand, or 0.45%, compared to net income of $4.9 million for the quarter ended March 31, 2024. In the linked quarter comparison, net income decreased $1.2 million, or 20.04%, compared to net income of $6.1 million for the quarter ending December 31, 2024. Net interest income before provision for credit losses increased from the linked and prior year quarters by $980 thousand and $2.5 million, respectively.   The decline in linked quarterly net earnings was primarily driven by higher income tax provisioning, increased CECL-related reserves for unfunded loan commitments, and an increase in salary and benefits costs related to the payment of first quarter bonuses for the prior year.

“We are very pleased with our first-quarter performance, highlighted by strong growth in core net interest income. This was driven by a 12 basis-point expansion in our net interest margin compared to the fourth quarter of last year. Despite significant loan payoffs during the quarter, we achieved loan growth of over $23 million, or 2.12%, representing an annualized growth rate of 8.48%. Our asset quality remains strong, and we’ve seen a slight reduction in our adversely classified ratio from the same time last year,” said Spence Mullis, Chairman and CEO.  

The net interest margin was 4.29% for the first quarter of 2025 compared to 4.17% for the fourth quarter of 2024 and 3.99% for the first quarter of 2024. The average yield on earning assets grew 6 basis points from 6.01%, as of December 31, 2024, to 6.07%, while the Bank’s cost of funds decreased 9 basis points from 2.06% to 1.97% during the same period.

Provision for credit losses increased $549 thousand and provisioning for unfunded loan commitments increased $521 thousand during the quarter as a result of loan growth. The Company’s asset quality improved during the quarter, as reflected by a decline in the Bank’s adversely classified asset index from 4.96% as of December 31, 2024, to 4.66% as of March 31, 2025. The Bank’s reserve as a percentage of total loans was 1.30% for March 31, 2025, as compared to 1.30% for December 31, 2024, and 1.34% for March 31, 2024.   Noninterest expense increased $621 thousand, or 6.95%, compared to the prior quarter ended December 31, 2024, due mainly to higher salary and benefits expenses. With the expiration of solar project tax credits used by the Company each of the last three years, income tax provision increased by $1.0 million, or 217.28%, during the quarter.

After paying a regular quarterly dividend of $0.12 per share and a one-time special dividend of $0.15 per share, the Company’s total shareholders’ equity increased 1.18% during the quarter to $198 million as of March 31, 2025, and up 8.75%, or $15.9 million, from March 31, 2024. The tangible book value of the company grew to $17.66 on March 31, 2025, from $17.45 on December 31, 2024, and was up 9.21% from $16.17¹ as of March 31, 2024. On April 16, 2025, the board of directors approved a second quarter dividend of $0.12 per share payable on or about June 15, 2025, to all shareholders of record as of May 15, 2025.

Forward-looking Statements

Certain statements contained in this release may not be based on historical facts and are forward-looking statements. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “may,” “might,” “will,” “would,” “could” or “intend.” We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including, among others, the business and economic conditions; risks related to the integration of acquired businesses and any future acquisitions; changes in management personnel; interest rate risk; ability to execute on planned expansion and organic growth; credit risk and concentrations associated with the Company’s loan portfolio; asset quality and loan charge-offs; inaccuracy of the assumptions and estimates management of the Company makes in establishing reserves for probable loan losses and other estimates; lack of liquidity; impairment of investment securities, goodwill or other intangible assets; the Company’s risk management strategies; increased competition; system failures or failures to prevent breaches of our network security; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes; and increases in capital requirements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.

^{1 Common stock, tangible book value and per share amounts for March 31, 2024 and previous quarters have been adjusted to reflect the April 22, 2024 4-for-1 stock dividend.}

MORRIS STATE BANCSHARES, INC.
AND SUBSIDIARIES
Consolidating Balance Sheet
		March 31,				December 31,											March 31,
		2025				2024				Change				% Change			2024				Change				% Change
		(Unaudited)															(Unaudited)
ASSETS
Cash and due from banks		$	92,342,678			$	53,898,138			$	38,444,540			71.33	%		$	67,354,916			$	24,987,762			37.10	%
Federal funds sold			15,606,716				42,064,131				(26,457,415	)		-62.90	%			3,746,408				11,860,308			316.58	%
Total cash and cash equivalents			107,949,394				95,962,269				11,987,125			12.49	%			71,101,324				36,848,070			51.82	%
Interest-bearing time deposits in other banks			100,000				100,000				--			0.00	%			100,000				--			0.00	%
Securities available for sale, at fair value			9,414,147				9,726,716				(312,569	)		-3.21	%			7,845,095				1,569,052			0.00	%
Securities held to maturity, at cost (net of CECL Reserve)			208,561,077				215,836,502				(7,275,425	)		-3.37	%			231,758,455				(23,197,378	)		-10.01	%
Federal Home Loan Bank stock, restricted, at cost			1,084,200				1,032,800				51,400			4.98	%			1,029,600				54,600			5.30	%
Loans, net of unearned income			1,139,719,828				1,116,074,659				23,645,169			2.12	%			1,060,755,992				78,963,836			7.44	%
Less-allowance for credit losses			(14,829,709	)			(14,488,525	)			(341,184	)		2.35	%			(14,236,149	)			(593,560	)		4.17	%
Loans, net			1,124,890,119				1,101,586,134				23,303,985			2.12	%			1,046,519,843				78,370,276			7.49	%
Bank premises and equipment, net			14,844,597				12,780,014				2,064,583			16.15	%			13,112,437				1,732,160			13.21	%
ROU assets for operating lease, net			692,339				776,979				(84,640	)		-10.89	%			1,035,712				(343,373	)		-33.15	%
Goodwill			9,361,704				9,361,704				--			0.00	%			9,361,704				--			0.00	%
Intangible assets, net			1,253,288				1,338,964				(85,676	)		-6.40	%			1,594,101				(340,813	)		-21.38	%
Other real estate and foreclosed assets			15,503				21,898				(6,395	)		-29.20	%			38,558				(23,055	)		-59.79	%
Accrued interest receivable			6,369,932				7,278,258				(908,326	)		-12.48	%			5,964,911				405,021			6.79	%
Cash surrender value of life insurance			15,233,512				15,128,762				104,750			0.69	%			14,813,139				420,373			2.84	%
Other assets			21,726,495				22,674,658				(948,163	)		-4.18	%			25,151,653				(3,425,158	)		-13.62	%
Total Assets		$	1,521,496,307			$	1,493,605,658			$	27,890,649			1.87	%		$	1,429,426,532				92,069,775			6.44	%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Non-interest bearing		$	330,414,834			$	325,534,335			$	4,880,499			1.50	%		$	302,810,356				27,604,478			9.12	%
Interest bearing			963,948,287				939,354,005				24,594,282			2.62	%			904,181,606				59,766,681			6.61	%
			1,294,363,121				1,264,888,340				29,474,781			2.33	%			1,206,991,962				87,371,159			7.24	%
Other borrowed funds			19,029,606				19,019,372				10,234			0.05	%			27,169,934				(8,140,328	)		-29.96	%
Lease liability for operating lease			692,339				776,979				(84,640	)		-10.89	%			1,035,712				(343,373	)		-33.15	%
Accrued interest payable			2,778,669				2,111,093				667,576			31.62	%			1,419,439				1,359,230			95.76	%
Accrued expenses and other liabilities			6,726,119				11,206,717				(4,480,598	)		-39.98	%			10,830,616				(4,104,497	)		-37.90	%
Total liabilities			1,323,589,854				1,298,002,501				25,587,353			1.97	%			1,247,447,663				76,142,191			6.10	%
Shareholders' Equity:
Common stock			10,701,756				10,688,723				13,033			0.12	%			10,645,509				56,247			0.53	%
Paid in capital surplus			35,307,009				34,936,059				370,950			1.06	%			34,349,749				957,260			2.79	%
Retained earnings			149,055,224				130,111,050				18,944,174			14.56	%			133,038,717				16,016,507			12.04	%
Current year earnings			4,913,056				21,804,345				(16,891,289	)		-77.47	%			4,890,818				22,238			0.45	%
Accumulated other comprehensive income (loss)			1,289,137				1,422,709				(133,572	)		-9.39	%			1,811,160				(522,023	)		-28.82	%
Treasury Stock, at cost 95,498			(3,359,729	)			(3,359,729	)			--			0.00	%			(2,757,084	)			(602,645	)		21.86	%
Total shareholders' equity			197,906,453				195,603,157				2,303,296			1.18	%			181,978,869				15,927,584			8.75	%
Total Liabilities and Shareholders' Equity		$	1,521,496,307			$	1,493,605,658				27,890,649			1.87	%		$	1,429,426,532				92,069,775			6.44	%

MORRIS STATE BANCSHARES, INC.
AND SUBSIDIARIES
Consolidating Statement of Income
for the Three Months Ended
		March 31,				December 31,											March 31,
		2025				2024				Change				% Change			2024				Change				% Change
		(Unaudited)				(Unaudited)											(Unaudited)
Interest and Dividend Income:
Interest and fees on loans		$	19,338,360			$	18,818,919			$	519,441			2.76	%		$	17,124,889			$	2,213,471			12.93	%
Interest income on securities			1,671,657				1,735,131				(63,474	)		-3.66	%			1,970,394				(298,737	)		-15.16	%
Income on federal funds sold			534,479				363,781				170,698			46.92	%			168,129				366,350			217.90	%
Income on time deposits held in other banks			605,454				362,174				243,280			67.17	%			408,412				197,042			48.25	%
Other interest and dividend income			25,413				22,116				3,297			14.91	%			75,848				(50,435	)		-66.49	%
Total interest and dividend income			22,175,363				21,302,121				873,242			4.10	%			19,747,672				2,427,691			12.29	%
Interest Expense:
Deposits			6,413,065				6,401,228				11,837			0.18	%			6,339,843				73,222			1.15	%
Interest on other borrowed funds			286,480				404,974				(118,494	)		-29.26	%			445,278				(158,798	)		-35.66	%
Interest on federal funds purchased			--				129				(129	)		-100.00	%			--				--			0.00	%
Total interest expense			6,699,545				6,806,331				(106,786	)		-1.57	%			6,785,121				(85,576	)		-1.26	%
Net interest income before provision for loan losses			15,475,818				14,495,790				980,028			6.76	%			12,962,551				2,513,267			19.39	%
Less-provision for credit losses			577,123				27,972				549,151			1963.22	%			4,501				572,622			12722.11	%
Net interest income after provision for credit losses			14,898,695				14,467,818				430,877			2.98	%			12,958,050				1,940,645			14.98	%
Noninterest Income:
Service charges on deposit accounts			540,600				560,822				(20,222	)		-3.61	%			491,568				49,032			9.97	%
Other service charges, commissions and fees			380,482				393,175				(12,693	)		-3.23	%			362,692				17,790			4.90	%
Gain on sales of foreclosed assets			--				--				--			--				700				(700	)		-100.00	%
Gain on sale of securities available for sale			--				447				(447	)		-100.00	%			--				--			447
Increase in CSV of life insurance			104,750				106,388				(1,638	)		-1.54	%			101,516				3,234			3.19	%
Other income			20,407				15,349				5,058			32.95	%			251,361				(230,954	)		-91.88	%
Total noninterest income			1,046,239				1,076,181				(29,942	)		-2.78	%			1,207,837				(161,598	)		-13.38	%
Noninterest Expense:
Salaries and employee benefits			5,122,152				4,743,238				378,914			7.99	%			4,861,534				260,618			5.36	%
Occupancy and equipment expenses, net			527,532				550,212				(22,680	)		-4.12	%			545,126				(17,594	)		-3.23	%
Loss on sales of foreclosed assets			--				8,457				(8,457	)		-100.00	%			--				--			--
Other expenses			3,905,857				3,632,476				273,381			7.53	%			3,716,219				189,638			5.10	%
Total noninterest expense			9,555,541				8,934,383				621,158			6.95	%			9,122,879				432,662			4.74	%
Income Before Income Taxes			6,389,393				6,609,616				(220,223	)		-3.33	%			5,043,008				1,346,385			26.70	%
Provision for income taxes			1,476,337				465,314				1,011,023			217.28	%			152,190				1,324,147			870.06	%
																						-
Net Income		$	4,913,056			$	6,144,302				(1,231,246	)		-20.04	%		$	4,890,818				22,238			0.45	%
Earnings per common share:
Basic		$	0.46			$	0.58				(0.12	)		-20.69	%		$	0.46				-			0.00	%
Diluted		$	0.46			$	0.58				(0.12	)		-20.69	%		$	0.46				-			0.00	%
		.

MORRIS STATE BANCSHARES, INC.
AND SUBSIDIARIES
		Quarter Ending
		March 31,				December 31,				March 31,
		2025				2024				2024
Dollars in thousand, except per share data		(Unaudited)				(Unaudited)				(Unaudited)
Per Share Data
Basic Earnings per Common Share		$	0.46			$	0.58			$	0.46
Diluted Earnings per Common Share			0.46				0.58				0.46
Dividends per Common Share			0.27				0.092				0.092
Book Value per Common Share			18.66				18.46				17.20
Tangible Book Value per Common Share			17.66				17.45				16.17
Average Diluted Shared Outstanding			10,593,370				10,596,432				10,602,289
End of Period Common Shares Outstanding			10,606,258				10,593,225				10,624,932
Annualized Performance Ratios (Bank Only)
Return on Average Assets			1.41	%			1.79	%			1.55	%
Return on Average Equity			11.12	%			13.69	%			11.74	%
Equity/Assets			12.75	%			12.84	%			13.09	%
Yield on Earning Assets			6.07	%			6.01	%			5.87	%
Cost of Funds			1.97	%			2.06	%			2.09	%
Net Interest Margin			4.29	%			4.17	%			3.99	%
Efficiency Ratio			57.90	%			54.21	%			61.48	%
Credit Metrics
Allowance for Credit Losses to Total Loans			1.30	%			1.30	%			1.34	%
Adversely Classified Assets to Tier 1 Capital
plus Allowance for Credit Losses			4.66	%			4.96	%			5.22	%

CONTACT:
Morris State Bancshares
Chris Bond
Chief Financial Officer
478-272-5202 

FAQ

What was Morris State Bancshares (MBLU) net income for Q1 2025?

Morris State Bancshares reported net income of $4.9 million for Q1 2025, up 0.45% from Q1 2024 but down 20.04% from Q4 2024.

How much did MBLU's loan portfolio grow in Q1 2025?

MBLU achieved loan growth of $23 million (2.12%) in Q1 2025, representing an annualized growth rate of 8.48%.

What is MBLU's dividend payment for Q2 2025?

The board approved a Q2 2025 dividend of $0.12 per share, payable around June 15, 2025, to shareholders of record as of May 15, 2025.

How did MBLU's net interest margin perform in Q1 2025?

Net interest margin improved to 4.29% in Q1 2025, up from 4.17% in Q4 2024 and 3.99% in Q1 2024.