FS Bancorp (FSBW) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $9.0 million, nearly flat year-over-year, as higher noninterest income offset lower net interest income and higher provision for credit losses.

• Book value per share rose to $37.15 at June 30, 2024, up $4.44 year-over-year.

• Quarterly dividend increased to $0.27 per share; new $5.0 million share repurchase plan announced.

• Total assets decreased to $2.94 billion at June 30, 2024, from $2.97 billion at year-end 2023.

• Loan portfolio growth was driven by increases in one-to-four-family, multi-family, and home equity loans, while construction and CRE loans declined.

Financial highlights

• Net interest income for Q2 2024 was $30.4 million, down $1.2 million year-over-year due to higher deposit and borrowing costs.

• Net interest margin fell to 4.29% from 4.66% year-over-year, reflecting increased funding costs.

• Noninterest income rose $1.0 million to $5.9 million, driven by higher gains on loan and investment sales and fair value adjustments.

• Noninterest expense decreased $347,000 to $23.9 million, mainly from lower loan costs and FDIC insurance.

• Efficiency ratio improved to 65.78% from 66.52% year-over-year.

Outlook and guidance

• Management expects continued focus on growing and diversifying the loan portfolio, maintaining strong asset quality, and emphasizing core deposits.

• The company projects ongoing investment in home lending operations and disciplined construction lending.

• Management remains focused on matching deposit/liability duration with loan/assets and enhancing shareholder value through dividends and share repurchases.

• No material changes in risk factors or market risk disclosures were noted since the last annual report.