Baton Rouge, LA , 01/23/2025 / 17:07, CST/CDT - EQS Newswire - Investar Bank (Nasdaq)
Investar Holding Corporation ("Investar") ISTR, the holding company for Investar Bank, National Association (the "Bank"), today announced financial results for the quarter ended December 31, 2024. Investar reported net income of $6.1 million, or $0.61 per diluted common share, for the fourth quarter of 2024, compared to net income of $5.4 million, or $0.54 per diluted common share, for the quarter ended September 30, 2024, and net income of $3.5 million, or $0.36 per diluted common share, for the quarter ended December 31, 2023.
On a non-GAAP basis, core earnings per diluted common share for the fourth quarter of 2024 were $0.65 compared to $0.45 for the third quarter of 2024 and $0.39 for the fourth quarter of 2023. Core earnings exclude certain non-operating items including, but not limited to, loss (gain) on call or sale of investment securities, net, loss on sale or disposition of fixed assets, net, loss on sale of other real estate owned, net, change in the fair value of equity securities, income from a legal settlement, loss on early extinguishment of subordinated debt, and legal settlement expense. As previously indicated, Investar's fourth quarter of 2024 results include $3.1 million in nontaxable noninterest income from bank owned life insurance ("BOLI") death benefit proceeds, which had a favorable impact on our core metrics. Refer to the Reconciliation of Non-GAAP Financial Measures tables for a reconciliation of GAAP to non-GAAP metrics, including the impact of BOLI death benefit proceeds on our core metrics.
Investar's President and Chief Executive Officer John D'Angelo commented:
"Over the past year, Investar has successfully implemented a strategy of consistent, quality earnings through the optimization of our balance sheet, and the fourth quarter results reflect our continued execution. Our net interest margin has begun to stabilize as our cost of funds has decreased. We remained focused on originating higher yielding loans and securing lower cost funding sources that are accretive to our margin. During the fourth quarter, in accordance with our strategy to remix the loan portfolio, we originated and renewed loans, 84% of which were variable-rate loans, at an 8.2% blended interest rate. We also repaid $109 million in borrowings under the Bank Term Funding Program and redeemed $20 million in principal amount of subordinated debt, which contributed to the decrease in our cost of funds. Additionally, despite inflationary pressures, noninterest expenses are closely monitored and remain well-controlled.
Credit quality remained very solid as nonperforming loans represented 0.42% of total loans at December 31, 2024, and we continued to allow higher risk commercial real estate relationships to run off.
We have closely managed our interest-earning assets and funding costs and are actively evaluating potential opportunities to further optimize our balance sheet mix to improve shareholder returns. Our liability sensitive balance sheet is well-positioned in the event of further rate cuts to benefit from the repricing of deposits and short-term borrowings.
As always, we remain focused on shareholder value and returning capital to shareholders. During the year, we paid quarterly dividends totaling $0.41 per share, which represented a 4% increase from the previous year."
Fourth Quarter Highlights
Return on average assets increased to 0.88% for the quarter ended December 31, 2024 compared to 0.77% for the quarter ended September 30, 2024. Core return on average assets, which includes the impact of BOLI death benefit proceeds, increased to 0.93% for the quarter ended December 31, 2024 compared to 0.63% for the quarter ended September 30, 2024.
Efficiency ratio improved to 71.00% for the quarter ended December 31, 2024 compared to 75.61% for the quarter ended September 30, 2024. Core efficiency ratio, which includes the impact of BOLI death benefit proceeds, improved to 69.41% for the quarter ended December 31, 2024 compared to 79.33% for the quarter ended September 30, 2024.
Investar received BOLI death benefit proceeds totaling $5.5 million, and recorded a related $3.1 million in nontaxable noninterest income from BOLI, during the quarter ended December 31, 2024.
Noninterest expense decreased $0.1 million to $16.1 million for the quarter ended December 31, 2024 compared to $16.2 million for the quarter ended September 30, 2024. Core noninterest expense remained flat at $15.9 million for the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024.
The overall cost of funds for the quarter ended December 31, 2024 decreased 12 basis points to 3.49% compared to 3.61% for the quarter ended September 30, 2024. The cost of deposits decreased five basis points to 3.40% for the quarter ended December 31, 2024 compared to 3.45% for the quarter ended September 30, 2024.
Credit quality remained solid with nonperforming loans comprising 0.42% of total loans at December 31, 2024 compared to 0.19% at September 30, 2024.
Variable-rate loans as a percentage of total loans was 32% at December 31, 2024 compared to 30% at September 30, 2024. During the fourth quarter of 2024, we originated and renewed loans, 84% of which were variable-rate loans, at an 8.2% blended interest rate.
Consistent with our strategy of optimizing the balance sheet, total loans decreased $30.8 million, or 1.4%, to $2.13 billion at December 31, 2024, compared to $2.16 billion at September 30, 2024. As a result of our strategy, we recognized the benefit of a $0.7 million negative provision for credit losses.
Total deposits increased $58.5 million, or 2.6%, to $2.35 billion at December 31, 2024 compared to $2.29 billion at September 30, 2024.
Investar redeemed all of the remaining $20.0 million in principal amount of our 5.125% Fixed-to-Floating Rate Subordinated Notes due 2029 (the "2029 Notes"). The 2029 Notes were to bear interest at a floating rate higher than the fixed rate beginning on December 31, 2024.
During the fourth quarter of 2024, Investar repaid all of the remaining $109.0 million in borrowings under the Federal Reserve's Bank Term Funding Program ("BTFP"), which contributed to the decrease in our overall cost of funds. The weighted average rate was 4.76% for the quarter ended December 31, 2024.
Investar's regulatory common equity tier 1 capital ratio increased to 10.85%, or 5.0% at December 31, 2024 compared to 10.33% at September 30, 2024.
Loans
Total loans were $2.13 billion at December 31, 2024, a decrease of $30.8 million, or 1.4%, compared to September 30, 2024, and a decrease of $85.5 million, or 3.9%, compared to December 31, 2023.
The following table sets forth the composition of the total loan portfolio as of the dates indicated (dollars in thousands).
Linked Quarter Change
Year/Year Change
Percentage of Total Loans
12/31/2024
9/30/2024
12/31/2023
$
%
$
%
12/31/2024
12/31/2023
Mortgage loans on real estate
Construction and development
$
154,553
$
166,954
$
190,371
$
(12,401
)
(7.4)
%
$
(35,818
)
(18.8)
%
7.3
%
8.6
%
1-4 Family
396,815
403,097
413,786
(6,282
)
(1.6
)
(16,971
)
(4.1
)
18.7
18.7
Multifamily
84,576
85,283
105,946
(707
)
(0.8
)
(21,370
)
(20.2
)
4.0
4.8
Farmland
6,977
7,173
7,651
(196
)
(2.7
)
(674
)
(8.8
)
0.3
0.4
Commercial real estate
Owner-occupied
449,259
467,467
449,610
(18,208
)
(3.9
)
(351
)
(0.1
)
21.1
20.3
Nonowner-occupied
495,289
499,274
488,098
(3,985
)
(0.8
)
7,191
1.5
23.3
22.1
Commercial and industrial
526,928
515,273
543,421
11,655
2.3
(16,493
)
(3.0
)
24.8
24.6
Consumer
10,687
11,325
11,736
(638
)
(5.6
)
(1,049
)
(8.9
)
0.5
0.5
Total loans
$
2,125,084
$
2,155,846
$
2,210,619
$
(30,762
)
(1.4)
%
$
(85,535
)
(3.9)
%
100
%
100
%
At December 31, 2024, Investar's total business lending portfolio, which consists of loans secured by owner-occupied commercial real estate properties and commercial and industrial loans, was $976.2 million, a decrease of $6.6 million, or 0.7%, compared to the business lending portfolio of $982.7 million at September 30, 2024, and a decrease of $16.8 million, or 1.7%, compared to the business lending portfolio of $993.0 million at December 31, 2023. The decrease in the business lending portfolio compared to September 30, 2024 is primarily driven by loan amortization in owner-occupied commercial real estate, partially offset by increased loan production by our Commercial and Industrial Division. The decrease in the business lending portfolio compared to December 31, 2023 is primarily driven by loan amortization consistent with our strategy of optimizing the balance sheet, partially offset by conversions of construction and development loans to owner-occupied loans upon completion of construction.
Nonowner-occupied loans totaled $495.3 million at December 31, 2024, a decrease of $4.0 million, or 0.8%, compared to $499.3 million at September 30, 2024, and an increase of $7.2 million, or 1.5%, compared to $488.1 million at December 31, 2023. The decrease in nonowner-occupied loans compared to September 30, 2024 is due to loan amortization and aligns with our strategy to optimize the mix of the portfolio. The increase in nonowner-occupied loans compared to December 31, 2023 is primarily due to a reclassification of a $15.9 million multifamily loan to a nonowner-occupied loan and conversions of construction and development loans to nonowner-occupied loans upon completion of construction, partially offset by loan amortization.
Construction and development loans totaled $154.6 million at December 31, 2024, a decrease of $12.4 million, or 7.4%, compared to $167.0 million at September 30, 2024, and a decrease of $35.8 million, or 18.8%, compared to $190.4 million at December 31, 2023. The decrease in construction and development loans compared to September 30, 2024 and December 31, 2023 is primarily due to conversions to permanent loans upon completion of construction.
Credit Quality
Nonperforming loans were $8.8 million, or 0.42% of total loans, at December 31, 2024, an increase of $4.7 million compared to $4.1 million, or 0.19% of total loans, at September 30, 2024, and an increase of $3.0 million compared to $5.8 million, or 0.26% of total loans, at December 31, 2023. The increase in nonperforming loans compared to September 30, 2024 is mainly attributable to one nonowner-occupied commercial real estate relationship totaling $2.4 million, two owner-occupied commercial real estate relationships totaling $1.3 million, and ten 1-4 family loan relationships totaling $1.3 million, partially offset by paydowns.
The allowance for credit losses was $26.7 million, or 302.8% and 1.26% of nonperforming and total loans, respectively, at December 31, 2024, compared to $28.1 million, or 682.0% and 1.30% of nonperforming and total loans, respectively, at September 30, 2024, and $30.5 million, or 529.3% and 1.38% of nonperforming and total loans, respectively, at December 31, 2023.
Investar recorded a negative provision for credit losses of $0.7 million for the quarter ended December 31, 2024 compared to a negative provision for credit losses of $0.9 million and a provision for credit losses of $0.5 million for the quarters ended September 30, 2024 and December 31, 2023, respectively. The negative provision for credit losses in the quarter ended December 31, 2024 is primarily attributable to a decrease in total loans, aging of existing loans, and an improvement in the economic forecast. The negative provision for credit losses in the quarter ended September 30, 2024 was primarily due to net recoveries of $0.4 million, a decrease in total loans, aging of existing loans, and an improvement in the economic forecast. The provision for credit losses for the quarter ended December 31, 2023 was primarily attributable to loan growth resulting from the purchase of commercial and industrial revolving lines of credit, partially offset by an improvement in the economic forecast.
Deposits
Total deposits at December 31, 2024 were $2.35 billion, an increase of $58.5 million, or 2.6%, compared to $2.29 billion at September 30, 2024, and an increase of $90.2 million, or 4.0%, compared to $2.26 billion at December 31, 2023.
The following table sets forth the composition of deposits as of the dates indicated (dollars in thousands).
Linked Quarter Change
Year/Year Change
Percentage of Total Deposits
12/31/2024
9/30/2024
12/31/2023
$
%
$
%
12/31/2024
12/31/2023
Noninterest-bearing demand deposits
$
432,143
$
437,734
$
448,752
$
(5,591
)
(1.3
)%
$
(16,609
)
(3.7
)%
18.4
%
19.9
%
Interest-bearing demand deposits
554,777
500,345
489,604
54,432
10.9
65,173
13.3
23.7
21.7
Money market deposits
191,548
196,710
179,366
(5,162
)
(2.6
)
12,182
6.8
8.2
8.0
Brokered demand deposits
47,320
-
-
47,320
-
47,320
-
2.0
-
Savings deposits
134,879
128,241
137,606
6,638
5.2
(2,727
)
(2.0
)
5.7
6.1
Brokered time deposits
245,520
271,684
269,102
(26,164
)
(9.6
)
(23,582
)
(8.8
)
10.5
11.9
Time deposits
739,757
752,694
731,297
(12,937
)
(1.7
)
8,460
1.2
31.5
32.4
Total deposits
$
2,345,944
$
2,287,408
$
2,255,727
$
58,536
2.6
%
$
90,217
4.0
%
100
%
100
%
The increase in interest-bearing demand deposits and savings deposits at December 31, 2024 compared to September 30, 2024 is primarily the result of organic growth. The decrease in noninterest-bearing demand deposits and money market deposits at December 31, 2024 compared to September 30, 2024 is primarily due to customers drawing down on their existing deposit accounts. The decrease in time deposits at December 31, 2024 compared to September 30, 2024 is primarily due to a reduced emphasis on time deposits. Brokered time deposits decreased to $245.5 million at December 31, 2024 from $271.7 million at September 30, 2024. Investar utilizes brokered time deposits, entirely in denominations of less than $250,000, to secure fixed cost funding and reduce short-term borrowings. At December 31, 2024, the balance of brokered time deposits remained below 10% of total assets, and the remaining weighted average duration was approximately seven months with a weighted average rate of 4.99%. Investar utilizes brokered demand deposits when pricing is more favorable than other short-term borrowings. For the quarter ended December 31, 2024, brokered demand deposits had a weighted average rate of 4.43%.
The increase in interest-bearing demand deposits, money market deposits, and time deposits at December 31, 2024 compared to December 31, 2023 is primarily the result of organic growth. The decrease in noninterest-bearing demand deposits and savings deposits at December 31, 2024 compared to December 31, 2023 is primarily due to customers drawing down on their existing deposit accounts and shifts into interest-bearing deposit products with higher rates.
Stockholders' Equity
Stockholders' equity was $241.3 million at December 31, 2024, a decrease of $4.2 million, or 1.7%, compared to September 30, 2024, and an increase of $14.5 million, or 6.4%, compared to December 31, 2023. The decrease in stockholders' equity compared to September 30, 2024 is primarily attributable to an increase in accumulated other comprehensive loss due to a decrease in the fair value of the Bank's available for sale securities portfolio, partially offset by net income for the quarter. The increase in stockholders' equity compared to December 31, 2023 is primarily attributable to net income for the 12 months ended December 31, 2024, partially offset by an increase in accumulated other comprehensive loss due to a decrease in the fair value of the Bank's available for sale securities portfolio.
Net Interest Income
Net interest income for the fourth quarter of 2024 totaled $17.5 million, a decrease of $0.4 million, or 2.1%, compared to the third quarter of 2024, and a decrease of $1.0 million, or 5.5%, compared to the fourth quarter of 2023. Total interest income was $35.5 million, $36.8 million and $36.7 million for the quarters ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively. Total interest expense was $18.0 million, $19.0 million and $18.2 million for the corresponding periods. Included in net interest income for the quarters ended December 31, 2024, September 30, 2024 and December 31, 2023 is $11,000, $13,000, and $25,000, respectively, of interest income accretion from the acquisition of loans. Also included in net interest income for the quarters ended December 31, 2024, September 30, 2024 and December 31, 2023 are interest recoveries of $11,000, $79,000 and $1.1 million, respectively.
Investar's net interest margin was 2.65% for the quarter ended December 31, 2024, compared to 2.67% for the quarter ended September 30, 2024 and 2.72% for the quarter ended December 31, 2023. The decrease in net interest margin for the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024 was driven by a 13 basis point decrease in the yield on interest-earning assets, partially offset by a 12 basis point decrease in the overall cost of funds. The decrease in net interest margin for the quarter ended December 31, 2024 compared to the quarter ended December 31, 2023 was driven by a nine basis point increase in the overall cost of funds and a two basis point decrease in the yield on interest-earning assets.
The yield on interest-earning assets was 5.38% for the quarter ended December 31, 2024, compared to 5.51% for the quarter ended September 30, 2024 and 5.40% for the quarter ended December 31, 2023. The decrease in the yield on interest-earning assets compared to the quarter ended September 30, 2024 was driven by a 17 basis point decrease in the yield on our loan portfolio. The decrease in the yield on interest-earning assets compared to the quarter ended December 31, 2023 was driven by a six basis point decrease in the yield on our loan portfolio.
Exclusive of the interest income accretion from the acquisition of loans and interest recoveries, discussed above, adjusted net interest margin decreased to 2.64% for the quarter ended December 31, 2024, compared to 2.66% for the quarter ended September 30, 2024 and increased from 2.56% for the quarter ended December 31, 2023. The adjusted yield on interest-earning assets was 5.37% for the quarter ended December 31, 2024 compared to 5.50% and 5.23% for the quarters ended September 30, 2024 and December 31, 2023, respectively. Refer to the Reconciliation of Non-GAAP Financial Measures table for a reconciliation of GAAP to non-GAAP metrics.
The cost of deposits decreased five basis points to 3.40% for the quarter ended December 31, 2024 compared to 3.45% for the quarter ended September 30, 2024 and increased 23 basis points compared to 3.17% for the quarter ended December 31, 2023. The decrease in the cost of deposits compared to the quarter ended September 30, 2024 resulted primarily from both a lower average balance of, and a decrease in rates paid on, brokered time deposits and a decrease in rates paid on time deposits, partially offset by both a higher average balance of, and an increase in rates paid on, interest-bearing demand deposits. The increase in the cost of deposits compared to the quarter ended December 31, 2023 resulted primarily from both a higher average balance of, and an increase in rates paid on, interest-bearing demand deposits and an increase in rates paid on time deposits, partially offset by both a lower average balance of, and a decrease in rates paid on, brokered time deposits.
The cost of short-term borrowings decreased 68 basis points to 3.91% for the quarter ended December 31, 2024 compared to 4.59% for the quarter ended September 30, 2024 and decreased 93 basis points compared to 4.84% for the quarter ended December 31, 2023. Beginning in the second quarter of 2023, the Bank began utilizing the BTFP to secure fixed rate funding for up to a one-year term and reduce short-term Federal Home Loan Bank ("FHLB") advances, which are priced daily. The Bank utilized this source of funding due to its lower rate as compared to FHLB advances, the ability to prepay the obligations without penalty, and as a means to lock in funding. During the fourth quarter of 2024, the Bank repaid all of the remaining $109.0 million in borrowings under the BTFP. The decrease in the cost of short-term borrowings compared to the quarter ended September 30, 2024 resulted primarily from a lower average balance of borrowings under the BTFP. The decrease in the cost of short-term borrowings compared to the quarter ended December 31, 2023 resulted primarily from both a lower average balance of, and a decrease in rates paid on, borrowings under the BTFP, which were driven by a decrease in the Federal Reserve's federal funds rate.
The overall cost of funds for the quarter ended December 31, 2024 decreased 12 basis points to 3.49% compared to 3.61% for the quarter ended September 30, 2024 and increased nine basis points compared to 3.40% for the quarter ended December 31, 2023. The decrease in the cost of funds for the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024 resulted from a decrease in the cost of deposits and both a decrease in the average balance of, and a decrease in the cost of short-term borrowings, partially offset by a higher average balance of deposits. The increase in the cost of funds for the quarter ended December 31, 2024 compared to the quarter ended December 31, 2023 resulted from both a higher average balance of, and an increase in the cost of deposits, partially offset by both a lower average balance of, and a decrease in the cost of short-term borrowings.
Noninterest Income
Noninterest income for the fourth quarter of 2024 totaled $5.2 million, an increase of $1.6 million, or 45.7%, compared to the third quarter of 2024 and an increase of $3.4 million, or 194.2%, compared to the fourth quarter of 2023.
The increase in noninterest income compared to the quarter ended September 30, 2024 is driven by a $3.1 million increase in income from BOLI, partially offset by a $1.1 million decrease in income from legal settlement and a $0.4 million increase in loss on call or sale of investment securities. During the fourth quarter, the Bank received BOLI death benefit proceeds totaling $5.5 million and recorded $3.1 million in income from BOLI. During the third quarter, Investar recorded $1.1 million in income from a legal settlement related to one loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida.
The increase in noninterest income compared to the quarter ended December 31, 2023 is driven by a $3.2 million increase in income from BOLI, a $0.1 million increase in change in the fair value of equity securities, and a $0.1 million increase in other operating income. The increase in other operating income is primarily attributable to a $0.1 million increase in distributions from investments.
Noninterest Expense
Noninterest expense for the fourth quarter of 2024 totaled $16.1 million, a decrease of $0.1 million, or 0.6%, compared to the third quarter of 2024, and an increase of $0.6 million, or 4.1%, compared to the fourth quarter of 2023.
The decrease in noninterest expense for the quarter ended December 31, 2024 compared to the quarter ended September 30, 2024 was driven by a $0.2 million decrease in salaries and employee benefits and a $0.1 million decrease in other operating expenses, partially offset by a $0.2 million increase in loss on early extinguishment of subordinated debt. The decrease in salaries and employee benefits was primarily due to decreases in salaries expense and deferred compensation expense, partially offset by an increase in health insurance claims. During the fourth quarter of 2024, Investar redeemed $20.0 million in principal amount of our 2029 Notes and recognized a loss on early extinguishment of subordinated debt of $0.2 million primarily consisting of unamortized deferred financing costs. The decrease in other operating expenses is primarily due to a decrease in collection and repossession expenses and Federal Deposit Insurance Corporation ("FDIC") assessments, partially offset by an increase in charitable contributions.
The increase in noninterest expense for the quarter ended December 31, 2024 compared to the quarter ended December 31, 2023 was driven by a $0.8 million increase in salaries and employee benefits and a $0.2 million increase in loss on early extinguishment of subordinated debt, partially offset by a $0.2 million decrease in depreciation and amortization and a $0.2 million decrease in other operating expenses. The increase in salaries and employee benefits is primarily due to investment in people with an emphasis on our Texas markets to remix and strengthen our balance sheet and an increase in incentive-based compensation. The decrease in depreciation and amortization is primarily due to the closure of one branch location in the first quarter of 2024. The decrease in other operating expenses is primarily due to a decrease in bank shares tax and a decrease in other real estate expense, partially offset by an increase in charitable contributions.
Taxes
Investar recorded income tax expense of $1.2 million for the quarter ended December 31, 2024, which equates to an effective tax rate of 16.0%, an increase from the effective tax rate of 12.7% for the quarter ended September 30, 2024 and a decrease from the effect tax rate of 18.1% for the quarter ended December 31, 2023. The third quarter 2024 effective tax rate reflected a revision to our estimated 2024 annual effective tax rate to account for the projected increase in nontaxable income from BOLI in the fourth quarter of $3.1 million upon receipt of death benefit proceeds.
Basic and Diluted Earnings Per Common Share
Investar reported basic and diluted earnings per common share of $0.62 and $0.61, respectively, for the quarter ended December 31, 2024, compared to basic and diluted earnings per common share of $0.55 and $0.54, respectively for the quarter ended September 30, 2024, and basic and diluted earnings per common share of $0.36 for the quarter ended December 31, 2023.
About Investar Holding Corporation
Investar, headquartered in Baton Rouge, Louisiana, provides full banking services, excluding trust services, through its wholly-owned banking subsidiary, Investar Bank, National Association. The Bank currently operates 29 branch locations serving Louisiana, Texas, and Alabama. At December 31, 2024, the Bank had 331 full-time equivalent employees and total assets of $2.7 billion.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles in the United States of America, or GAAP. These measures and ratios include "tangible common equity," "tangible assets," "tangible equity to tangible assets," "tangible book value per common share," "core noninterest income," "core earnings before noninterest expense," "core noninterest expense," "core earnings before income tax expense," "core income tax expense," "core earnings," "core efficiency ratio," "core return on average assets," "core return on average equity," "core basic earnings per share," and "core diluted earnings per share." We also present certain average loan, yield, net interest income and net interest margin data adjusted to show the effects of excluding interest recoveries and interest income accretion from the acquisition of loans. Management believes these non-GAAP financial measures provide information useful to investors in understanding Investar's financial results, and Investar believes that its presentation, together with the accompanying reconciliations, provide a more complete understanding of factors and trends affecting Investar's business and allow investors to view performance in a manner similar to management, the entire financial services sector, bank stock analysts and bank regulators. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results, and Investar strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. A reconciliation of the non-GAAP financial measures disclosed in this press release to the comparable GAAP financial measures is included at the end of the financial statement tables.
Forward-Looking and Cautionary Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Investar's current views with respect to, among other things, future events and financial performance. Investar generally identifies forward-looking statements by terminology such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "could," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of those words or other comparable words.
Any forward-looking statements contained in this press release are based on the historical performance of Investar and its subsidiaries or on Investar's current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by Investar that the future plans, estimates or expectations by Investar will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to Investar's operations, financial results, financial condition, business prospects, growth strategy and liquidity. If one or more of these or other risks or uncertainties materialize, or if Investar's underlying assumptions prove to be incorrect, Investar's actual results may vary materially from those indicated in these statements. Investar does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements. These factors include, but are not limited to, the following, any one or more of which could materially affect the outcome of future events:
the significant risks and uncertainties for our business, results of operations and financial condition, as well as our regulatory capital and liquidity ratios and other regulatory requirements caused by business and economic conditions generally and in the financial services industry in particular, whether nationally, regionally or in the markets in which we operate;
changes in inflation, interest rates, yield curves and interest rate spread relationships that affect our loan and deposit pricing;
our ability to successfully execute our near-term strategy to pivot from primarily a growth strategy to a strategy primarily focused on consistent, quality earnings through the optimization of our balance sheet, and our ability to successfully execute a long-term growth strategy;
our ability to achieve organic loan and deposit growth, and the composition of that growth;
a reduction in liquidity, including as a result of a reduction in the amount of deposits we hold or other sources of liquidity, which may be caused by, among other things, disruptions in the banking industry similar to those that occurred in early 2023 that caused bank depositors to move uninsured deposits to other banks or alternative investments outside the banking industry;
our ability to identify and enter into agreements to combine with attractive acquisition candidates, finance acquisitions, complete acquisitions after definitive agreements are entered into, and successfully integrate and grow acquired operations;
our adoption on January 1, 2023 of ASU 2016-13, and inaccuracy of the assumptions and estimates we make in establishing reserves for credit losses and other estimates;
changes in the quality or composition of our loan or investment portfolios, including adverse developments in borrower industries or in the repayment ability of individual borrowers;
changes in the quality and composition of, and changes in unrealized losses in, our investment portfolio, including whether we may have to sell securities before their recovery of amortized cost basis and realize losses;
the extent of continuing client demand for the high level of personalized service that is a key element of our banking approach as well as our ability to execute our strategy generally;
our dependence on our management team, and our ability to attract and retain qualified personnel;
the concentration of our business within our geographic areas of operation in Louisiana, Texas and Alabama;
increasing costs of complying with new and potential future regulations;
new or increasing geopolitical tensions, including resulting from wars in Ukraine and Israel and surrounding areas;
the emergence or worsening of widespread public health challenges or pandemics including COVID-19;
concentration of credit exposure;
any deterioration in asset quality and higher loan charge-offs, and the time and effort necessary to resolve problem assets;
fluctuations in the price of oil and natural gas;
data processing system failures and errors;
risks associated with our digital transformation process, including increased risks of cyberattacks and other security breaches and challenges associated with addressing the increased prevalence of artificial intelligence;
risks of losses resulting from increased fraud attacks against us and others in the financial services industry;
our potential growth, including our entrance or expansion into new markets, and the need for sufficient capital to support that growth;
the impact of litigation and other legal proceedings to which we become subject;
competitive pressures in the commercial finance, retail banking, mortgage lending and consumer finance industries, as well as the financial resources of, and products offered by, competitors;
the impact of changes in laws and regulations applicable to us, including banking, securities and tax laws and regulations and accounting standards, as well as changes in the interpretation of such laws and regulations by our regulators;
changes in the scope and costs of FDIC insurance and other coverages;
governmental monetary and fiscal policies; and
hurricanes, tropical storms, tropical depressions, floods, winter storms, droughts and other adverse weather events, all of which have affected Investar's market areas from time to time; other natural disasters; oil spills and other man-made disasters; acts of terrorism; other international or domestic calamities; acts of God; and other matters beyond our control.
These factors should not be construed as exhaustive. Additional information on these and other risk factors can be found in Part I Item 1A. "Risk Factors" and in the "Special Note Regarding Forward-Looking Statements" in Part II Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Investar's Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission.
For further information contact:
Investar Holding Corporation John Campbell Executive Vice President and Chief Financial Officer (225) 227-2215 John.Campbell@investarbank.com
INVESTAR HOLDING CORPORATION SUMMARY FINANCIAL INFORMATION (Amounts in thousands, except share data) (Unaudited)
As of and for the three months ended
12/31/2024
9/30/2024
12/31/2023
Linked Quarter
Year/Year
EARNINGS DATA
Total interest income
$
35,505
$
36,848
$
36,668
(3.6
)%
(3.2
)%
Total interest expense
18,022
18,992
18,177
(5.1
)
(0.9
)
Net interest income
17,483
17,856
18,491
(2.1
)
(5.5
)
Provision for credit losses
(701
)
(945
)
486
25.8
(244.2
)
Total noninterest income
5,163
3,544
1,755
45.7
194.2
Total noninterest expense
16,079
16,180
15,440
(0.6
)
4.1
Income before income tax expense
7,268
6,165
4,320
17.9
68.2
Income tax expense
1,161
784
782
48.1
48.5
Net income
$
6,107
$
5,381
$
3,538
13.5
72.6
AVERAGE BALANCE SHEET DATA
Total assets
$
2,763,734
$
2,796,969
$
2,817,388
(1.2
)%
(1.9
)%
Total interest-earning assets
2,626,533
2,660,011
2,694,474
(1.3
)
(2.5
)
Total loans
2,129,388
2,159,412
2,214,916
(1.4
)
(3.9
)
Total interest-bearing deposits
1,881,297
1,813,775
1,824,318
3.7
3.1
Total interest-bearing liabilities
2,054,561
2,093,260
2,119,724
(1.8
)
(3.1
)
Total deposits
2,315,730
2,246,901
2,279,211
3.1
1.6
Total stockholders' equity
247,230
238,778
212,454
3.5
16.4
PER SHARE DATA
Earnings:
Basic earnings per common share
$
0.62
$
0.55
$
0.36
12.7
%
72.2
%
Diluted earnings per common share
0.61
0.54
0.36
13.0
69.4
Core earnings(1):
Core basic earnings per common share(1)
0.66
0.45
0.39
46.7
69.2
Core diluted earnings per common share(1)
0.65
0.45
0.39
44.4
66.7
Book value per common share
24.55
24.98
23.26
(1.7
)
5.5
Tangible book value per common share(1)
20.31
20.73
18.92
(2.0
)
7.3
Common shares outstanding
9,828,413
9,827,622
9,748,067
0.0
0.8
Weighted average common shares outstanding - basic
9,828,146
9,828,776
9,754,617
0.0
0.8
Weighted average common shares outstanding - diluted
9,993,790
9,902,448
9,763,296
0.9
2.4
PERFORMANCE RATIOS
Return on average assets
0.88
%
0.77
%
0.50
%
14.3
%
76.0
%
Core return on average assets(1)
0.93
0.63
0.54
47.6
72.2
Return on average equity
9.83
8.97
6.61
9.6
48.7
Core return on average equity(1)
10.40
7.40
7.16
40.5
45.3
Net interest margin
2.65
2.67
2.72
(0.7
)
(2.6
)
Net interest income to average assets
2.52
2.54
2.60
(0.8
)
(3.1
)
Noninterest expense to average assets
2.31
2.30
2.17
0.4
6.5
Efficiency ratio(2)
71.00
75.61
76.26
(6.1
)
(6.9
)
Core efficiency ratio(1)
69.41
79.33
74.85
(12.5
)
(7.3
)
Dividend payout ratio
16.94
19.09
27.78
(11.3
)
(39.0
)
Net charge-offs (recoveries) to average loans
0.04
(0.02
)
-
300.0
-
(1) Non-GAAP financial measure. See reconciliation. (2) Efficiency ratio represents noninterest expense divided by the sum of net interest income (before provision for credit losses) and noninterest income.
INVESTAR HOLDING CORPORATION SUMMARY FINANCIAL INFORMATION (Unaudited)
As of and for the three months ended
12/31/2024
9/30/2024
12/31/2023
Linked Quarter
Year/Year
ASSET QUALITY RATIOS
Nonperforming assets to total assets
0.52
%
0.32
%
0.36
%
62.5
%
44.4
%
Nonperforming loans to total loans
0.42
0.19
0.26
121.1
61.5
Allowance for credit losses to total loans
1.26
1.30
1.38
(3.1
)
(8.7
)
Allowance for credit losses to nonperforming loans
302.77
682.03
529.32
(55.6
)
(42.8
)
CAPITAL RATIOS
Investar Holding Corporation:
Total equity to total assets
8.86
%
8.76
%
8.06
%
1.1
%
9.9
%
Tangible equity to tangible assets(1)
7.44
7.38
6.65
0.9
11.9
Tier 1 leverage capital
9.27
8.95
8.35
3.6
11.0
Common equity tier 1 capital(2)
10.85
10.33
9.51
5.0
14.1
Tier 1 capital(2)
11.26
10.74
9.90
4.8
13.7
Total capital(2)
13.14
13.48
12.99
(2.5
)
1.2
Investar Bank:
Tier 1 leverage capital
9.70
10.06
9.81
(3.6
)
(1.1
)
Common equity tier 1 capital(2)
11.79
12.07
11.64
(2.3
)
1.3
Tier 1 capital(2)
11.79
12.07
11.64
(2.3
)
1.3
Total capital(2)
12.94
13.26
12.89
(2.4
)
0.4
(1) Non-GAAP financial measure. See reconciliation. (2) Estimated for December 31, 2024.
Available for sale securities at fair value (amortized cost of $392,564, $399,615, and $419,283, respectively)
331,121
350,646
361,918
Held to maturity securities at amortized cost (estimated fair value of $42,144, $18,018, and $20,513, respectively)
42,687
18,302
20,472
Loans
2,125,084
2,155,846
2,210,619
Less: allowance for credit losses
(26,721
)
(28,103
)
(30,540
)
Loans, net
2,098,363
2,127,743
2,180,079
Equity securities at fair value
2,593
2,434
1,180
Nonmarketable equity securities
16,502
13,951
13,417
Bank premises and equipment, net of accumulated depreciation of $21,853, $21,275, and $19,476, respectively
40,705
41,795
44,183
Other real estate owned, net
5,218
4,739
4,438
Accrued interest receivable
14,423
14,324
14,366
Deferred tax asset
17,120
14,719
16,910
Goodwill and other intangible assets, net
41,696
41,844
42,320
Bank-owned life insurance
59,703
61,667
58,797
Other assets
24,759
24,069
25,066
Total assets
$
2,722,812
$
2,802,573
$
2,815,155
LIABILITIES
Deposits
Noninterest-bearing
$
432,143
$
437,734
$
448,752
Interest-bearing
1,913,801
1,849,674
1,806,975
Total deposits
2,345,944
2,287,408
2,255,727
Advances from Federal Home Loan Bank
67,215
63,500
23,500
Borrowings under Bank Term Funding Program
-
109,000
212,500
Repurchase agreements
8,376
12,994
8,633
Subordinated debt, net of unamortized issuance costs
16,697
36,494
44,320
Junior subordinated debt
8,733
8,709
8,630
Accrued taxes and other liabilities
34,551
38,926
35,077
Total liabilities
2,481,516
2,557,031
2,588,387
STOCKHOLDERS' EQUITY
Preferred stock, no par value per share; 5,000,000 shares authorized
-
-
-
Common stock, $1.00 par value per share; 40,000,000 shares authorized; 9,828,413, 9,827,622, and 9,748,067 shares issued and outstanding, respectively
9,828
9,828
9,748
Surplus
146,890
146,393
145,456
Retained earnings
132,935
127,860
116,711
Accumulated other comprehensive loss
(48,357
)
(38,539
)
(45,147
)
Total stockholders' equity
241,296
245,542
226,768
Total liabilities and stockholders' equity
$
2,722,812
$
2,802,573
$
2,815,155
INVESTAR HOLDING CORPORATION CONSOLIDATED STATEMENTS OF INCOME (Amounts in thousands, except share data) (Unaudited)
For the three months ended
For the twelve months ended
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
December 31, 2023
INTEREST INCOME
Interest and fees on loans
$
31,438
$
32,764
$
33,128
$
128,498
$
117,892
Interest on investment securities
Taxable
2,709
2,755
2,970
11,047
12,372
Tax-exempt
569
228
253
1,249
693
Other interest income
789
1,101
317
3,071
2,244
Total interest income
35,505
36,848
36,668
143,865
133,201
INTEREST EXPENSE
Interest on deposits
16,071
15,729
14,584
61,510
42,072
Interest on borrowings
1,951
3,263
3,593
12,602
16,609
Total interest expense
18,022
18,992
18,177
74,112
58,681
Net interest income
17,483
17,856
18,491
69,753
74,520
Provision for credit losses
(701
)
(945
)
486
(3,480
)
(2,000
)
Net interest income after provision for credit losses
18,184
18,801
18,005
73,233
76,520
NONINTEREST INCOME
Service charges on deposit accounts
804
828
798
3,241
3,090
(Loss) gain on call or sale of investment securities, net
(371
)
1
(322
)
(753
)
(323
)
(Loss) gain on sale or disposition of fixed assets, net
-
-
(39
)
427
(1,323
)
(Loss) gain on sale of other real estate owned, net
(25
)
(4
)
-
683
(114
)
Gain on sale of loans
-
-
-
-
75
Servicing fees and fee income on serviced loans
-
-
2
-
14
Interchange fees
407
403
417
1,615
1,697
Income from bank owned life insurance
3,576
459
371
4,886
1,417
Change in the fair value of equity securities
159
174
24
413
(65
)
Legal settlement
-
1,122
-
1,122
-
Other operating income
613
561
504
2,571
2,070
Total noninterest income
5,163
3,544
1,755
14,205
6,538
Income before noninterest expense
23,347
22,345
19,760
87,438
83,058
NONINTEREST EXPENSE
Depreciation and amortization
736
760
909
3,095
3,780
Salaries and employee benefits
9,792
9,982
9,003
38,615
37,143
Occupancy
647
652
706
2,576
2,994
Data processing
901
880
892
3,611
3,482
Marketing
136
121
68
370
302
Professional fees
434
473
461
1,797
1,933
Loss (gain) on early extinguishment of subordinated debt
210
-
-
(292
)
-
Other operating expenses
3,223
3,312
3,401
13,260
12,996
Total noninterest expense
16,079
16,180
15,440
63,032
62,630
Income before income tax expense
7,268
6,165
4,320
24,406
20,428
Income tax expense
1,161
784
782
4,154
3,750
Net income
$
6,107
$
5,381
$
3,538
$
20,252
$
16,678
EARNINGS PER SHARE
Basic earnings per common share
$
0.62
$
0.55
$
0.36
$
2.06
$
1.69
Diluted earnings per common share
0.61
0.54
0.36
2.04
1.69
Cash dividends declared per common share
0.105
0.105
0.10
0.41
0.395
INVESTAR HOLDING CORPORATION CONSOLIDATED AVERAGE BALANCE SHEET, INTEREST EARNED AND YIELD ANALYSIS (Amounts in thousands) (Unaudited)
For the three months ended
December 31, 2024
September 30, 2024
December 31, 2023
Average Balance
Interest Income/ Expense
Yield/ Rate
Average Balance
Interest Income/ Expense
Yield/ Rate
Average Balance
Interest Income/ Expense
Yield/ Rate
Assets
Interest-earning assets:
Loans
$
2,129,388
$
31,438
5.87
%
$
2,159,412
$
32,764
6.04
%
$
2,214,916
$
33,128
5.93
%
Securities:
Taxable
389,170
2,709
2.77
396,254
2,755
2.77
427,746
2,970
2.75
Tax-exempt
44,544
569
5.08
24,552
228
3.68
28,807
253
3.50
Interest-bearing balances with banks
63,431
789
4.95
79,793
1,101
5.49
23,005
317
5.46
Total interest-earning assets
2,626,533
35,505
5.38
2,660,011
36,848
5.51
2,694,474
36,668
5.40
Cash and due from banks
25,222
26,121
27,214
Intangible assets
41,775
41,927
42,414
Other assets
98,057
97,704
83,447
Allowance for credit losses
(27,853
)
(28,794
)
(30,161
)
Total assets
$
2,763,734
$
2,796,969
$
2,817,388
Liabilities and stockholders' equity
Interest-bearing liabilities:
Deposits:
Interest-bearing demand deposits
$
753,477
$
4,342
2.29
%
$
676,946
$
3,440
2.02
%
$
668,277
$
2,873
1.71
%
Brokered demand deposits
1,312
15
4.43
-
-
-
-
-
-
Savings deposits
130,896
371
1.13
127,536
366
1.14
136,045
318
0.93
Brokered time deposits
246,104
3,103
5.02
255,076
3,335
5.20
275,552
3,590
5.17
Time deposits
749,508
8,240
4.37
754,217
8,588
4.53
744,444
7,803
4.16
Total interest-bearing deposits
1,881,297
16,071
3.40
1,813,775
15,729
3.45
1,824,318
14,584
3.17
Short-term borrowings
68,237
671
3.91
207,539
2,396
4.59
218,977
2,672
4.84
Long-term debt
105,027
1,280
4.85
71,946
867
4.79
76,429
921
4.78
Total interest-bearing liabilities
2,054,561
18,022
3.49
2,093,260
18,992
3.61
2,119,724
18,177
3.40
Noninterest-bearing deposits
434,433
433,126
454,893
Other liabilities
27,510
31,805
30,317
Stockholders' equity
247,230
238,778
212,454
Total liability and stockholders' equity
$
2,763,734
$
2,796,969
$
2,817,388
Net interest income/net interest margin
$
17,483
2.65
%
$
17,856
2.67
%
$
18,491
2.72
%
INVESTAR HOLDING CORPORATION CONSOLIDATED AVERAGE BALANCE SHEET, INTEREST EARNED AND YIELD ANALYSIS (Amounts in thousands) (Unaudited)
For the twelve months ended
December 31, 2024
December 31, 2023
Average Balance
Interest Income/ Expense
Yield/ Rate
Average Balance
Interest Income/ Expense
Yield/ Rate
Assets
Interest-earning assets:
Loans
$
2,163,161
$
128,498
5.94
%
$
2,123,234
$
117,892
5.55
%
Securities:
Taxable
399,855
11,047
2.76
447,442
12,372
2.76
Tax-exempt
29,930
1,249
4.17
22,051
693
3.14
Interest-bearing balances with banks
56,851
3,071
5.40
38,561
2,244
5.82
Total interest-earning assets
2,649,797
143,865
5.43
2,631,288
133,201
5.06
Cash and due from banks
25,890
29,142
Intangible assets
42,006
42,695
Other assets
95,391
86,712
Allowance for credit losses
(28,933
)
(30,242
)
Total assets
$
2,784,151
$
2,759,595
Liabilities and stockholders' equity
Interest-bearing liabilities:
Deposits:
Interest-bearing demand deposits
$
692,390
$
14,024
2.03
%
$
688,786
$
8,941
1.30
%
Brokered demand deposits
455
22
4.76
-
-
-
Savings deposits
130,553
1,418
1.09
134,817
534
0.40
Brokered time deposits
249,668
12,878
5.16
163,873
8,224
5.02
Time deposits
745,002
33,168
4.45
699,648
24,373
3.48
Total interest-bearing deposits
1,818,068
61,510
3.38
1,687,124
42,072
2.49
Short-term borrowings
189,912
8,699
4.58
260,730
12,845
4.93
Long-term debt
81,152
3,903
4.81
82,844
3,764
4.54
Total interest-bearing liabilities
2,089,132
74,112
3.55
2,030,698
58,681
2.89
Noninterest-bearing deposits
430,433
489,175
Other liabilities
28,986
21,220
Stockholders' equity
235,600
218,502
Total liability and stockholders' equity
$
2,784,151
$
2,759,595
Net interest income/net interest margin
$
69,753
2.63
%
$
74,520
2.83
%
INVESTAR HOLDING CORPORATION RECONCILIATION OF NON-GAAP FINANCIAL MEASURES INTEREST EARNED AND YIELD ANALYSIS ADJUSTED FOR INTEREST RECOVERIES AND ACCRETION (Amounts in thousands) (Unaudited)
For the three months ended
December 31, 2024
September 30, 2024
December 31, 2023
Average Balance
Interest Income/ Expense
Yield/ Rate
Average Balance
Interest Income/ Expense
Yield/ Rate
Average Balance
Interest Income/ Expense
Yield/ Rate
Interest-earning assets:
Loans
$
2,129,388
$
31,438
5.87
%
$
2,159,412
$
32,764
6.04
%
$
2,214,916
$
33,128
5.93
%
Adjustments:
Interest recoveries
11
79
1,105
Accretion
11
13
25
Adjusted loans
2,129,388
31,416
5.87
2,159,412
32,672
6.02
2,214,916
31,998
5.73
Securities:
Taxable
389,170
2,709
2.77
396,254
2,755
2.77
427,746
2,970
2.75
Tax-exempt
44,544
569
5.08
24,552
228
3.68
28,807
253
3.50
Interest-bearing balances with banks
63,431
789
4.95
79,793
1,101
5.49
23,005
317
5.46
Adjusted interest-earning assets
2,626,533
35,483
5.37
2,660,011
36,756
5.50
2,694,474
35,538
5.23
Total interest-bearing liabilities
2,054,561
18,022
3.49
2,093,260
18,992
3.61
2,119,724
18,177
3.40
Adjusted net interest income/adjusted net interest margin
$
17,461
2.64
%
$
17,764
2.66
%
$
17,361
2.56
%
INVESTAR HOLDING CORPORATION RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Amounts in thousands, except share data) (Unaudited)
December 31, 2024
September 30, 2024
December 31, 2023
Tangible common equity
Total stockholders' equity
$
241,296
$
245,542
$
226,768
Adjustments:
Goodwill
40,088
40,088
40,088
Core deposit intangible
1,508
1,656
2,132
Trademark intangible
100
100
100
Tangible common equity
$
199,600
$
203,698
$
184,448
Tangible assets
Total assets
$
2,722,812
$
2,802,573
$
2,815,155
Adjustments:
Goodwill
40,088
40,088
40,088
Core deposit intangible
1,508
1,656
2,132
Trademark intangible
100
100
100
Tangible assets
$
2,681,116
$
2,760,729
$
2,772,835
Common shares outstanding
9,828,413
9,827,622
9,748,067
Tangible equity to tangible assets
7.44
%
7.38
%
6.65
%
Book value per common share
$
24.55
$
24.98
$
23.26
Tangible book value per common share
20.31
20.73
18.92
INVESTAR HOLDING CORPORATION RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Amounts in thousands, except share data) (Unaudited)
For the three months ended
December 31, 2024
September 30, 2024
December 31, 2023
Net interest income
(a)
$
17,483
$
17,856
$
18,491
Provision for credit losses
(701
)
(945
)
486
Net interest income after provision for credit losses
18,184
18,801
18,005
Noninterest income
(b)
5,163
3,544
1,755
Loss (gain) on call or sale of investment securities, net
371
(1
)
322
Loss on sale or disposition of fixed assets, net
-
-
39
Loss on sale of other real estate owned, net
25
4
-
Change in the fair value of equity securities
(159
)
(174
)
(24
)
Legal settlement(1)
-
(1,122
)
-
Change in the net asset value of other investments(2)
(25
)
(48
)
(43
)
Core noninterest income(3)
(d)
5,375
2,203
2,049
Core earnings before noninterest expense(3)
23,559
21,004
20,054
Total noninterest expense
(c)
16,079
16,180
15,440
Loss on early extinguishment of subordinated debt
(210
)
-
-
Severance(4)
(4
)
-
-
Loan purchase expense(5)
-
-
(66
)
Legal settlement expense(6)
-
(267
)
-
Core noninterest expense
(f)
15,865
15,913
15,374
Core earnings before income tax expense(3)
7,694
5,091
4,680
Core income tax expense(7)
1,231
647
847
Core earnings(3)
$
6,463
$
4,444
$
3,833
Core basic earnings per common share(3)
0.66
0.45
0.39
Diluted earnings per common share (GAAP)
$
0.61
$
0.54
$
0.36
Loss (gain) on call or sale of investment securities, net
0.03
-
0.03
Loss on sale or disposition of fixed assets, net
-
-
-
Loss on sale of other real estate owned, net
-
-
-
Change in the fair value of equity securities
(0.01
)
(0.01
)
-
Legal settlement(1)
-
(0.10
)
-
Change in the net asset value of other investments(2)
-
-
-
Loss on early extinguishment of subordinated debt
0.02
-
-
Severance(4)
-
-
-
Loan purchase expense(5)
-
-
-
Legal settlement expense(6)
-
0.02
-
Core diluted earnings per common share(3)
$
0.65
$
0.45
$
0.39
Efficiency ratio
(c) / (a+b)
71.00
%
75.61
%
76.26
%
Core efficiency ratio(3)
(f) / (a+d)
69.41
79.33
74.85
Core return on average assets(3)(8)
0.93
0.63
0.54
Core return on average equity(3)(8)
10.40
7.40
7.16
Total average assets
$
2,763,734
$
2,796,969
$
2,817,388
Total average stockholders' equity
247,230
238,778
212,454
(1)Adjustment to noninterest income directly attributable to income from a legal settlement related to one loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida. (2)Change in the net asset value of other investments represents unrealized gains or losses on Investar's investments in Small Business Investment Companies and other investment funds and is included in other operating income in the accompanying consolidated statements of income. (3)Core noninterest income, core earnings before noninterest expense, core earnings before income tax expense and core earnings include $3.1 million in nontaxable noninterest income from BOLI death benefit proceeds recorded during the quarter ended December 31, 2024. Excluding this income, core basic earnings per share, core diluted earnings per share, core efficiency ratio, core return on average assets, and core return on average equity are $0.39, $0.39, 80.35%, 0.55%, and 6.19%, respectively, for the quarter ended December 31, 2024. (4)Severance is included in salaries and employee benefits in the accompanying consolidated statements of income. (5)Adjustments to noninterest expense directly attributable to the purchase of loans, consisting of professional fees for legal and consulting services. (6)Adjustments to noninterest expense directly attributable to the income from a legal settlement, consisting of professional fees for legal services and collection and repossession expenses included in other operating expenses in the accompanying consolidated statements of income. (7)Core income tax expense is calculated using the effective tax rates of 16.0%, 12.7% and 18.1% for the quarters ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively. (8)Core earnings used in calculation. No adjustments were made to average assets or average equity.
