#United States #Peoples Financial #FNCB Merger #Q1 2025 Earnings #Dunmore

Peoples Financial Services Corp. Reports Strong Q1 2025 Earnings

Peoples Financial Services Corp. (NASDAQ: PFIS), the parent company of Peoples Security Bank and Trust Company, announced its unaudited financial results for the first quarter of 2025, showcasing a substantial increase in earnings compared to the previous quarter. The report highlights a net income of $15 million or $1.49 per diluted share for the quarter ending March 31, 2025, a significant rise from the $6.1 million or $0.61 per diluted share reported for the last quarter of 2024.

Financial Performance Overview

The growth in earnings can be mainly attributed to several factors. Firstly, there was an increase in net interest income alongside a reduced provision for credit losses and lower non-interest expenses. The bank's return on average assets was recorded at 1.22%, while the return on average equity stood at 12.70% for the first quarter, up from 0.47% and 5.07% in the previous quarter, respectively.

A notable event leading into this quarter was the merger with FNCB Bancorp, Inc., which was finalized on July 1, 2024. The financials from the merger contributed to the increased asset base, creating opportunities for growth. However, the company also incurred non-recurring expenses related to the acquisition totaling $0.2 million this quarter, compared to $5.0 million in Q4 2024.

Non-GAAP Measures and Core Performance

To provide further insight into its operational performance, Peoples Financial reported non-GAAP measures. Core net income, excluding non-recurring costs, amounted to $15.1 million or $1.51 per diluted share, showing an increase from $10.0 million or $0.99 per diluted share last quarter.

The company’s PPNR (pre-provision net revenue) also shows promising figures. For Q1 2025, PPNR was $18.3 million or $1.82 per diluted share, up from $9.6 million or $0.96 per diluted share in the prior quarter.

Earnings Components Breakdown

• - Net Interest Income: Increased to $39.5 million, up by $1.0 million from the previous quarter.
• - Noninterest Income: Reported at $6.3 million, significantly higher than $5.5 million last quarter, driven by gains from asset sales and increased cash surrender value of life insurance.
• - Noninterest Expenses: Decreased markedly to $27.4 million, down from $34.8 million in the previous quarter, largely due to reduced acquisition-related expenses and measures to cut operational costs.

Asset Quality and Book Value

As of March 31, 2025, total assets reached $5.0 billion, fueled by the bank's growing loan portfolio, which amounted to $4.0 billion. Importantly, nonperforming assets represented 0.59% of loans, showing stable asset quality. The company’s book value per common share improved to $48.21, reflecting a positive trend in shareholder equity.

Moreover, Peoples has enhanced its dividend policy, raising the first quarter dividend to $0.6175 per share, marking a 50.6% increase compared to the same quarter the previous year. This dividend increase signifies the company's commitment to returning value to its shareholders amidst its growth trajectory.

Conclusion

Peoples Financial Services Corp. continues to demonstrate strong financial health, with its latest earnings report indicating robust performance following the strategic merger with FNCB. With prudent financial management and growth-oriented strategies in place, the company is well-positioned for future success in a challenging banking landscape. As it moves forward, the focus will remain on leveraging its expanded footprint and enhancing service offerings to further bolster its market share in the region.

For additional insights and updates, you can visit psbt.com.