Catalyst Bancorp Inc (CLST, Financial) released its 8-K filing on April 24, 2025, detailing its financial results for the first quarter of 2025. The company, a bank holding entity, operates through its subsidiary, Catalyst Bank, focusing on community-oriented savings and loan services.
Financial Performance Overview
For the first quarter of 2025, Catalyst Bancorp Inc reported a net income of $586,000, a slight decrease from the $626,000 recorded in the fourth quarter of 2024. The company faced challenges in loan growth due to market turbulence, which led to project delays among customers. Despite these challenges, the company was recognized with the 'Best Community Banks to Work For' Award, highlighting its commitment to core values.
Loan and Deposit Analysis
As of March 31, 2025, total loans amounted to $166.1 million, reflecting a decrease of $1.0 million from the previous quarter. The decline was primarily seen in commercial and industrial loans, which fell by 4%. Total deposits also decreased by $5.1 million, or 3%, to $180.6 million, influenced by fluctuations in public funds.
| Loan Type | 3/31/2025 | 12/31/2024 | Change |
|---|---|---|---|
| Real Estate Loans | $138,696 | $138,716 | $(20) |
| Commercial and Industrial | $25,447 | $26,439 | $(992) |
| Total Loans | $166,077 | $167,076 | $(999) |
Credit Quality and Capital Management
Non-performing assets decreased by 6% to $1.7 million, with the ratio of NPAs to total assets improving slightly to 0.63%. The allowance for credit losses remained stable at $2.5 million, representing 1.51% of total loans. The company also repurchased 72,949 shares of its common stock, maintaining a strong capital position with shareholders' equity at $80.6 million.
Net Interest Income and Margins
Net interest income for the quarter was $2.4 million, a 4% decline from the previous quarter. The net interest margin narrowed slightly to 3.89%, impacted by a decrease in interest income from loans and cash. The average yield on interest-earning assets was 5.54%, while the average rate on interest-bearing liabilities was 2.56%.
Non-Interest Income and Expenses
Non-interest income rose by 64% to $553,000, driven by insurance proceeds for damages to foreclosed properties. However, non-interest expenses increased by 8% to $2.2 million, with notable rises in foreclosed asset expenses and advertising costs.
“Loan growth was muted to start the year as market turbulence caused some of our customers to delay projects,” said Joe Zanco, President and Chief Executive Officer of the Company and Bank.
Conclusion
Catalyst Bancorp Inc's first quarter results reflect the challenges of a turbulent market environment, impacting loan growth and net interest income. However, the company's recognition for workplace excellence and strategic capital management underscore its resilience. As the company navigates these challenges, maintaining credit quality and optimizing operational efficiency will be crucial for future performance.
Explore the complete 8-K earnings release (here) from Catalyst Bancorp Inc for further details.
