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Overview of Primis Financial Corp.'s Q1 2025 Performance

On April 29, 2025, Primis Financial Corp. (NASDAQ: FRST) released its earnings report for the first quarter of 2025, showcasing a remarkable turnaround with net income of $2.7 million, translating to earnings of $0.11 per share. This positive performance comes as a relief following a substantial loss of $23.3 million reported in the prior quarter (Q4 2024) and a modest gain of $2.5 million from the same quarter last year (Q1 2024). This resurgence marks a significant improvement in the company’s operational health, elevating investor confidence.

Key Financial Metrics

The report highlighted a normalized return on assets of 0.56%, illustrating the company's strategy for gradual rebuilding alongside optimizing its service delivery. CEO Dennis J. Zember, Jr. emphasized that recent improvements in performance are primarily due to a focus on asset management, cost efficiencies, and targeted growth in their mortgage division, suggesting a clearer pathway to future success.

Operating Results

In the first quarter, Primis Financial shifted its consumer loan book back to a held-for-investment classification after unsuccessful attempts to sell it. This led to an additional provision of $1.9 million in the company's CECL model. The additional expenses related to transitioning auditors and professional fees were recognized, amounting to unusually high costs in this quarter.

Excluding these nonrecurring charges, Primis Financial achieved an adjusted earnings figure of $5.1 million for this quarter. The bank’s prudent strategies allow for the anticipated return to growth towards the $3.75 billion asset level achieved in 2024, supported by expense management and effective recruiting efforts across the organization.

Strategic Progress and Community Engagement

Primis's commitment to serving its community is evident in its expansion efforts, which now include 24 banking offices across Virginia and Maryland. They hold $2.2 billion in low-cost customer deposits, ensuring competitive rates against regional peers. The bank is focused on refining its service delivery by utilizing technological innovations such as the proprietary V1BE service that enhances customer interaction.

Despite the traditionally slow first quarter for loan closings, the pipeline has strengthened, indicating a loan availability of $228 million as of March 31, 2025, in stark contrast to previous quarters.

Mortgage Division Growth

The company's mortgage division reported a profit of $0.8 million for the quarter, in stark contrast to a loss in preceding quarters. Locked loans increased by 27% from the fourth quarter of 2024. Primis successfully recruited new teams in key markets, enhancing production potential significantly.

Looking Ahead

Moving forward, Primis plans continued focus on core banking operations, efficiency improvements, and innovative digital strategies to secure additional deposits and enhance profitability. Their aspiration to reach 10,000 banking professionals through Panacea Financial remains on target.

With net interest income slightly improving to $26.4 million, Primis anticipates a continual increase in profit margins. Declining rates of nonperforming assets, the strategic consolidation of technology management, and anticipated operational cost savings significantly strengthen their position.

As they persist in optimally managing expenses, all indicators suggest a favorable outlook for the next quarter and the remainder of the fiscal year, ensuring a sharp contrast to previously reported losses.

The dividends declared for shareholders demonstrate a consistent commitment to stakeholder returns, embodying confidence in the company’s trajectory. As Primis Financial Corp. continues to focus on rebuilding, growth, and effective management, it aims for a significant enhancement in profitability and investor trust in the coming periods.