First Guaranty Bancshares (FGBI) Q3 2024 earnings summary

Executive summary

• Total assets reached $3.9 billion as of Q3 2024, up 14.8% year-over-year and $371.2 million since year-end 2023, driven by increases in investment securities, cash, and net loans.

• Net income for Q3 2024 was $1.9 million, up 8.7% year-over-year; nine-month net income rose 44.5% to $11.4 million.

• Earnings per share were $0.11 for Q3 and $0.78 for the nine months, both higher than prior year periods.

• Deposit base increased 14% to $3.4 billion, supported by new market expansion and time deposits, especially brokered deposits.

• Nonaccrual loans surged to $65.8 million, mainly due to a single $37 million commercial real estate relationship.

Financial highlights

• Net interest income for Q3 2024 was $22.7 million, up from $20.4 million last year; nine-month net interest income was $65.9 million.

• Net interest margin for Q3 2024 was 2.51%, down from 2.54% in Q3 2023; nine-month margin was 2.52%, down from 2.75%.

• Provision for credit losses surged to $4.9 million in Q3 and $14.0 million for nine months, reflecting higher credit risk.

• Allowance for credit losses totaled $33.3 million, or 1.20% of gross loans, up from $30.9 million (1.13%) at year-end.

• Noninterest income for nine months was $22.2 million, up from $8.0 million, mainly due to a $13.2 million gain on a sale-leaseback transaction.

Outlook and guidance

• Management expects continued growth in Texas and Mideast markets, with additional loan growth opportunities anticipated.

• Economic uncertainty and elevated nonaccrual loans may require further increases to the allowance for credit losses.

• Forward-looking statements caution about risks and uncertainties, referencing risk factors in recent SEC filings.

• A goodwill impairment charge is possible in Q4 2024 due to stock price performance and recent earnings.