EX-99.1 2 afbi-ex99_1.htm EX-99.1 EX-99.1

 

 

Affinity Bancshares, Inc.

Announces First Quarter 2025

Financial Results

 

 

Affinity Bancshares, Inc. (NASDAQ:“AFBI”) (the “Company”), the holding company for Affinity Bank (the“Bank”), today announced net income of $1.8 million for the three months ended March 31, 2025, as compared to $1.3 million for the three months ended March 31, 2024.

 

 

 

 

 

At or for the three months ended,

 

Performance Ratios:

 

March 31, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

 

June 30, 2024

 

 

March 31, 2024

 

Net income (in thousands)

 

$

1,831

 

 

$

1,345

 

 

$

1,730

 

 

$

1,031

 

 

$

1,335

 

Diluted earnings per share

 

 

0.28

 

 

 

0.20

 

 

 

0.26

 

 

 

0.16

 

 

 

0.20

 

Operating income (1)

 

 

1,996

 

 

 

1,738

 

 

 

1,883

 

 

 

1,763

 

 

 

1,374

 

Adjusted diluted earnings per share (1)

 

 

0.30

 

 

 

0.26

 

 

 

0.29

 

 

 

0.27

 

 

 

0.21

 

Common book value per share

 

 

19.25

 

 

 

20.14

 

 

 

20.02

 

 

 

19.49

 

 

 

19.21

 

Tangible book value per share (1)

 

 

16.40

 

 

 

17.30

 

 

 

17.18

 

 

 

16.64

 

 

 

16.36

 

Total assets (in thousands)

 

 

912,496

 

 

 

866,817

 

 

 

878,561

 

 

 

873,582

 

 

 

869,547

 

Return on average assets

 

 

0.83

%

 

 

0.61

%

 

 

0.78

%

 

 

0.48

%

 

 

0.63

%

Return on average equity

 

 

5.68

%

 

 

4.14

%

 

 

5.43

%

 

 

3.33

%

 

 

4.38

%

Equity to assets

 

 

13.40

%

 

 

14.90

%

 

 

14.61

%

 

 

14.32

%

 

 

14.18

%

Tangible equity to tangible assets (1)

 

 

11.65

%

 

 

13.08

%

 

 

12.80

%

 

 

12.49

%

 

 

12.33

%

Net interest margin

 

 

3.52

%

 

 

3.56

%

 

 

3.52

%

 

 

3.71

%

 

 

3.38

%

Efficiency ratio

 

 

68.55

%

 

 

75.95

%

 

 

71.48

%

 

 

78.74

%

 

 

75.96

%

(1) Non-GAAP measure - see “Explanation of Certain Unaudited Non-GAAP Financial Measures” for more information and reconciliation to GAAP.

 

 

Net Income

 

•
Net income was $1.8 million for three months ended March 31, 2025 as compared to $1.3 million for the three months ended March 31, 2024, as a result of an increase in net interest income along with a decrease in noninterest expenses offset by a decrease in noninterest income.
•
Operating income for the three months ended March 31, 2025 was $2.0 million as compared to $1.4 million for the three months ended March 31, 2024.

 

 

Results of Operations

 

•
Net interest income was $7.3 million for the three months ended March 31, 2025 compared to $6.7 million for the three months ended March 31, 2024. The increase was due to an increase in interest income on loans, partially offset by increases in deposit and borrowing costs and a decrease in interest income on interest-earning deposits and investment securities.
•
Net interest margin for the three months ended March 31, 2025 increased to 3.52% from 3.38% for the three months ended March 31, 2024. The increase in the margin relates to increases in our yield on earning assets increasing 19 basis points while our deposits and borrowing cost of funds only increased three basis points.
•
Noninterest income decreased $103,000 to $481,000 for the three months ended March 31, 2025, as a result of a decrease in service charges on deposit accounts.

 

 

 

•
Non-interest expense decreased $211,000 to $5.4 million for the three months ended March 31, 2025 compared to the 2024 period, due mainly to a decrease in professional fees.

 

Financial Condition

 

•
Total assets increased $45.7 million to $912.5 million at March 31, 2025 from $866.8 million at December 31, 2024, as we experienced loan growth and an increase in interest earning deposits which was funded from growth in our deposits.
•
Total gross loans increased $6.9 million to $721.0 million at March 31, 2025 from $714.1 million at December 31, 2024. The increase was due to steady loan demand in construction and consumer loans.
•
Non-owner occupied office loans totaled $43.4 million at March 31, 2025; the average LTV on these loans is 48.7%, including
o
$16.0 million medical/dental tenants and
o
$27.4 million to other various tenants.
•
Investment securities held-to-maturity unrealized gains were $91,000, net of tax. Investment securities available-for-sale unrealized losses were $5.1 million, net of tax.
•
Cash and cash equivalents increased $33.3 million to $74.7 million at March 31, 2025 from $41.4 million at December 31, 2024.
•
Deposits increased by $56.8 million to $730.3 million at March 31, 2025 compared to $673.5 million at December 31, 2024, with a $33.5 million net increase in demand deposits and a $23.3 million increase in certificates of deposits.
•
Borrowings decreased by $4.8 million to $54.0 million at March 31, 2025 compared to $58.8 million at December 31, 2024 as an advance from the Bank Term Funding program was paid in full.
•
Equity decreased $6.8 million to $122.3 million at March 31, 2025 from $129.1 million at December 31, 2024 from payment of $1.50 per share dividend that was declared and paid in first quarter, along with $1.2 million common stock repurchases.

 

Asset Quality

 

•
Non-performing loans decreased to $4.4 million at March 31, 2025 from $4.8 million at December 31, 2024.
•
The allowance for credit losses as a percentage of non-performing loans was 190.3% at March 31, 2025, as compared to 177.9% at December 31, 2024.
•
Allowance for credit losses to total loans decreased to 1.17% at March 31, 2025 from 1.19% at December 31, 2024.
•
Net loan charge-offs were $89,000 for the three months ended March 31, 2025, as compared to net loan charge-offs of $326,000 for the three months ended March 31, 2024.

 

About Affinity Bancshares, Inc.

 

The Company is a Maryland corporation based in Covington, Georgia. The Company’s banking subsidiary, Affinity Bank, opened in 1928 and currently operates a full-service office in Atlanta, Georgia, two full-service offices in Covington, Georgia, and a loan production office serving the Alpharetta and Cumming, Georgia markets.

 

Forward-Looking Statements

In addition to historical information, this release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which describe the future plans, strategies and expectations of the Company. Forward-looking statements can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “assume,” “plan,” “seek,” “expect,” “will,” “may,” “should,” “indicate,” “would,” “contemplate,” “continue,” “target” and words of similar meaning. Forward-looking statements are based on our current beliefs and expectations and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Accordingly, you should not place undue reliance on such statements. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of this report. Factors which

 

 

 

could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to, changes in general economic conditions, interest rates and inflation; changes in asset quality; our ability to access cost-effective funding; fluctuations in real estate values; changes in laws or regulations; changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio; changes in technology; failures or breaches of our IT security systems; our ability to introduce new products and services and capitalize on growth opportunities; changes in the value of our goodwill and other intangible assets; our ability to successfully integrate acquired operations or assets; changes in accounting policies and practices; our ability to retain key employees; and the effects of natural disasters and geopolitical events, including terrorism, conflict and acts of war. These risks and other uncertainties are further discussed in the reports that the Company files with the Securities and Exchange Commission.

 

 

 

 

Average Balance Sheets

The following tables set forth average balance sheets, average annualized yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are monthly average balances. Non-accrual loans were included in the computation of average balances. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense.

 

 

 

 

For the Three Months Ended March 31,

 

 

 

2025

 

 

2024

 

 

 

Average
Outstanding
Balance

 

 

Interest

 

 

Average
Yield/Rate

 

 

Average
Outstanding
Balance

 

 

Interest

 

 

Average
Yield/Rate

 

 

 

(Dollars in thousands)

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans

 

$

713,878

 

 

$

10,648

 

 

 

6.05

%

 

$

664,660

 

 

$

9,499

 

 

 

5.75

%

Investment securities held-to-maturity

 

 

27,313

 

 

 

421

 

 

 

6.25

%

 

 

34,213

 

 

 

528

 

 

 

6.21

%

Investment securities available-for-sale

 

 

38,188

 

 

 

324

 

 

 

3.44

%

 

 

48,169

 

 

 

463

 

 

 

3.87

%

Interest-earning deposits and federal funds

 

 

59,305

 

 

 

615

 

 

 

4.21

%

 

 

50,083

 

 

 

647

 

 

 

5.20

%

Other investments

 

 

6,185

 

 

 

97

 

 

 

6.36

%

 

 

5,447

 

 

 

84

 

 

 

6.20

%

Total interest-earning assets

 

 

844,869

 

 

 

12,105

 

 

 

5.81

%

 

 

802,572

 

 

 

11,221

 

 

 

5.62

%

Non-interest-earning assets

 

 

48,093

 

 

 

 

 

 

 

 

 

52,145

 

 

 

 

 

 

 

Total assets

 

$

892,962

 

 

 

 

 

 

 

 

$

854,717

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing checking accounts

 

$

81,598

 

 

$

84

 

 

 

0.42

%

 

$

88,057

 

 

$

103

 

 

 

0.47

%

Money market accounts

 

 

156,548

 

 

 

1,163

 

 

 

3.01

%

 

 

140,600

 

 

 

1,086

 

 

 

3.11

%

Savings accounts

 

 

79,222

 

 

 

555

 

 

 

2.84

%

 

 

74,412

 

 

 

528

 

 

 

2.85

%

Certificates of deposit

 

 

238,904

 

 

 

2,444

 

 

 

4.15

%

 

 

219,806

 

 

 

2,285

 

 

 

4.18

%

Total interest-bearing deposits

 

 

556,272

 

 

 

4,246

 

 

 

3.10

%

 

 

522,875

 

 

 

4,002

 

 

 

3.08

%

FHLB advances and other borrowings

 

 

54,856

 

 

 

522

 

 

 

3.86

%

 

 

52,615

 

 

 

470

 

 

 

3.59

%

Total interest-bearing liabilities

 

 

611,128

 

 

 

4,768

 

 

 

3.16

%

 

 

575,490

 

 

 

4,472

 

 

 

3.13

%

Non-interest-bearing liabilities

 

 

151,121

 

 

 

 

 

 

 

 

 

156,697

 

 

 

 

 

 

 

Total liabilities

 

 

762,249

 

 

 

 

 

 

 

 

 

732,187

 

 

 

 

 

 

 

Total stockholders' equity

 

 

130,713

 

 

 

 

 

 

 

 

 

122,530

 

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

892,962

 

 

 

 

 

 

 

 

$

854,717

 

 

 

 

 

 

 

Net interest rate spread

 

 

 

 

 

 

 

 

2.65

%

 

 

 

 

 

 

 

 

2.49

%

Net interest income

 

 

 

 

$

7,337

 

 

 

 

 

 

 

 

$

6,749

 

 

 

 

Net interest margin

 

 

 

 

 

 

 

 

3.52

%

 

 

 

 

 

 

 

 

3.38

%

 

 

 

 

AFFINITY BANCSHARES, INC.

Consolidated Balance Sheets

(unaudited)

 

 

 

 

 

 

 

 

 

 

March 31, 2025

 

 

December 31, 2024

 

 

 

(Dollars in thousands except per share amounts)

 

Assets

 

Cash and due from banks

 

$

6,205

 

 

$

7,092

 

Interest-earning deposits in other depository institutions

 

 

68,499

 

 

 

34,333

 

Cash and cash equivalents

 

 

74,704

 

 

 

41,425

 

Investment securities available-for-sale

 

 

40,979

 

 

 

36,502

 

Investment securities held-to-maturity (estimated fair value of $27,505 net of allowance for credit losses of $45 at March 31, 2025 and estimated fair value of $27,286 net of allowance for credit losses of $45 at December 31, 2024)

 

 

27,338

 

 

 

27,299

 

Other investments

 

 

6,202

 

 

 

6,175

 

Loans

 

 

720,980

 

 

 

714,115

 

Allowance for credit loss on loans

 

 

(8,457

)

 

 

(8,496

)

Net loans

 

 

712,523

 

 

 

705,619

 

Premises and equipment, net

 

 

3,177

 

 

 

3,261

 

Bank owned life insurance

 

 

16,587

 

 

 

16,487

 

Intangible assets

 

 

18,127

 

 

 

18,175

 

Other assets

 

 

12,859

 

 

 

11,874

 

Total assets

 

$

912,496

 

 

$

866,817

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

Non-interest-bearing checking

 

$

153,630

 

 

$

151,395

 

Interest-bearing checking

 

 

84,106

 

 

 

73,841

 

Money market accounts

 

 

164,442

 

 

 

148,752

 

Savings accounts

 

 

81,411

 

 

 

76,053

 

Certificates of deposit

 

 

246,703

 

 

 

223,440

 

Total deposits

 

 

730,292

 

 

 

673,481

 

Federal Home Loan Bank advances and other borrowings

 

 

54,000

 

 

 

58,815

 

Accrued interest payable and other liabilities

 

 

5,925

 

 

 

5,406

 

Total liabilities

 

 

790,217

 

 

 

737,702

 

Stockholders' equity:

 

 

 

 

 

 

Common stock (par value $0.01 per share, 40,000,000 shares authorized;
   6,350,640 issued and outstanding at March 31, 2025 and 6,409,598 issued and outstanding at December 31, 2024)

 

 

64

 

 

 

64

 

Preferred stock (10,000,000 shares authorized, no shares outstanding)

 

 

—

 

 

 

—

 

Additional paid in capital

 

 

61,781

 

 

 

62,355

 

Unearned ESOP shares

 

 

(4,088

)

 

 

(4,378

)

Retained earnings

 

 

69,600

 

 

 

76,786

 

Accumulated other comprehensive loss

 

 

(5,078

)

 

 

(5,712

)

Total stockholders' equity

 

 

122,279

 

 

 

129,115

 

Total liabilities and stockholders' equity

 

$

912,496

 

 

$

866,817

 

 

 

 

 

AFFINITY BANCSHARES, INC.

Consolidated Statements of Income

(unaudited)

 

 

 

 

Three Months Ended March 31,

 

 

 

 

2025

 

 

2024

 

 

 

 

(Dollars in thousands except per share amounts)

 

Interest income:

 

 

 

 

 

 

 

Loans, including fees

 

 

$

10,648

 

 

$

9,499

 

Investment securities

 

 

 

842

 

 

 

1,075

 

Interest-earning deposits

 

 

 

615

 

 

 

647

 

Total interest income

 

 

 

12,105

 

 

 

11,221

 

Interest expense:

 

 

 

 

 

 

 

Deposits

 

 

 

4,246

 

 

 

4,002

 

FHLB advances and other borrowings

 

 

 

522

 

 

 

470

 

Total interest expense

 

 

 

4,768

 

 

 

4,472

 

Net interest income before provision for credit losses

 

 

 

7,337

 

 

 

6,749

 

Provision for credit losses

 

 

 

50

 

 

 

—

 

Net interest income after provision for credit losses

 

 

 

7,287

 

 

 

6,749

 

Noninterest income:

 

 

 

 

 

 

 

Service charges on deposit accounts

 

 

 

316

 

 

 

395

 

Other

 

 

 

165

 

 

 

189

 

Total noninterest income

 

 

 

481

 

 

 

584

 

Noninterest expenses:

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

 

3,359

 

 

 

3,179

 

Occupancy

 

 

 

605

 

 

 

618

 

Data processing

 

 

 

543

 

 

 

511

 

Other

 

 

 

852

 

 

 

1,262

 

Total noninterest expenses

 

 

 

5,359

 

 

 

5,570

 

Income before income taxes

 

 

 

2,409

 

 

 

1,763

 

Income tax expense

 

 

 

578

 

 

 

428

 

Net income

 

 

$

1,831

 

 

$

1,335

 

Weighted average common shares outstanding

 

 

 

 

 

 

 

Basic

 

 

 

6,405,702

 

 

 

6,416,628

 

Diluted

 

 

 

6,547,817

 

 

 

6,524,332

 

Basic earnings per share

 

 

$

0.29

 

 

$

0.21

 

Diluted earnings per share

 

 

$

0.28

 

 

$

0.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Explanation of Certain Unaudited Non-GAAP Financial Measures

 

Reported amounts are presented in accordance with GAAP. Additionally, the Company believes the following information is utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Refer to the Non-GAAP Reconciliation tables below for details on the earnings impact of these items.

 

 

 

For the Three Months Ended

 

Non-GAAP Reconciliation

 

March 31, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

 

June 30, 2024

 

 

March 31, 2024

 

Operating net income reconciliation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (GAAP)

 

$

1,831

 

 

$

1,345

 

 

$

1,730

 

 

$

1,031

 

 

$

1,335

 

Net loss on securities available for sale

 

 

—

 

 

 

385

 

 

 

—

 

 

 

—

 

 

 

—

 

ESOP Compensation expense related to dividend

 

 

211

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Merger-related expenses

 

 

—

 

 

 

119

 

 

 

196

 

 

 

939

 

 

 

50

 

Income tax expense

 

 

(46

)

 

 

(111

)

 

 

(43

)

 

 

(207

)

 

 

(11

)

Operating net income

$

1,996

 

 

$

1,738

 

 

$

1,883

 

 

$

1,763

 

 

$

1,374

 

Weighted average diluted shares

 

 

6,547,817

 

 

 

6,620,602

 

 

 

6,611,468

 

 

 

6,546,382

 

 

 

6,524,332

 

Adjusted diluted earnings per share

 

$

0.30

 

 

$

0.26

 

 

$

0.29

 

 

$

0.27

 

 

$

0.21

 

Tangible book value per common share reconciliation

 

Book Value per common share (GAAP)

 

$

19.25

 

 

$

20.14

 

 

$

20.02

 

 

$

19.49

 

 

$

19.21

 

 Effect of goodwill and other intangibles

 

 

(2.85

)

 

 

(2.84

)

 

 

(2.84

)

 

 

(2.85

)

 

 

(2.85

)

Tangible book value per common share

$

16.40

 

 

$

17.30

 

 

$

17.18

 

 

$

16.64

 

 

$

16.36

 

Tangible equity to tangible assets reconciliation

 

Equity to assets (GAAP)

 

13.40

%

 

 

14.90

%

 

 

14.61

%

 

 

14.32

%

 

 

14.18

%

Effect of goodwill and other intangibles

 

 

(1.75

)%

 

 

(1.81

)%

 

 

(1.81

)%

 

 

(1.83

)%

 

 

(1.85

)%

Tangible equity to tangible assets (1)

 

 

11.65

%

 

 

13.08

%

 

 

12.80

%

 

 

12.49

%

 

 

12.33

%

(1) Tangible assets is total assets less intangible assets. Tangible equity is total equity less intangible assets.