Sturgis Bancorp, Inc. Reports Financial Results for Full-Year 2024

Rhea-AI Summary

Sturgis Bancorp (OTCQX:STBI) has reported its Q4 and full-year 2024 financial results. Q4 highlights include net income of $2.0 million, EPS of $0.91, and a dividend of $0.17 per share. Total assets reached $956 million with deposits at $814 million.

Full-year 2024 performance showed net income of $2.8 million (down from $6.0 million in 2023), with EPS of $1.32. The bank maintained strong capital ratios with Tier 1 leverage capital at 7.89%. Notable changes include:

• Net interest income decreased 1.70% to $28.0 million in 2024
• Provision for credit losses increased to $4.6 million (vs $1.3 million in 2023)
• Noninterest income rose 13.14% to $10.1 million
• Total assets grew by $37 million during the year

Positive

• Q4 net income improved to $2.0M from $1.5M in Q3
• Net interest income increased 7.09% YoY in Q4
• Noninterest income grew 13.14% to $10.1M in 2024
• Total assets increased by $37M during 2024
• Net loans grew to $768M from $739M YoY

Negative

• Annual net income declined 53.3% to $2.8M from $6.0M in 2023
• Major $5.5M loan charge-off in Q1 2024
• Credit loss provisions increased to $4.6M from $1.3M YoY
• Net interest income decreased 1.70% in 2024
• Book value per share declined to $25.66 from $25.94 YoY

STURGIS, MI / ACCESS Newswire / March 4, 2025 / Sturgis Bancorp, Inc. (OTCQX:STBI) today reported for the fourth quarter and full-year 2024:

Key Quarterly Highlights

• Net income of $2.0 million.

• Earnings per share of $0.91.

• Paid dividend of $0.17 per share.

• Total assets increased to $956 million.

• Deposits increased to $814 million.

• The Bank maintained strong capital ratios, exceeding "well capitalized" requirements, with Tier 1 leverage capital at 7.89%.

Key Full-Year Highlights

• Net income of $2.8 million.

• Earnings per share of $1.32.

• Quarterly dividends totaled $0.68 per share.

• Total assets increased by $37 million during the year.

• Deposits increased by $15 million during the year.

From Jason J. Hyska, Sturgis Bancorp, Inc. Chief Executive Officer

"The year ended on a positive note for the Bank. Net Income for 4Q24 was $2 million; 4Q24 Tier 1 Leverage Capital ended at 7.89% up from 1Q24's 7.64%, after the large commercial credit loss in 1Q24. The Bank's focus for 2025 is to continue to grow customer relationships by expanding wallet share. We will also continue focus efforts in our newer markets. The vision for our team is to continue to leverage the Community Bank model by focusing on what customers want and being there for our communities."

Quarterly Income Statement Highlights

• Net income for the quarter (4Q24) was $2.0 million, increasing from last quarter's (3Q24) $1.5 million net income, while also up from the net loss of $(350,000) for the same quarter of the prior year (4Q23). The increase from 4Q23 was substantially due to an increase in net interest income, after credit loss expense, higher earnings on bank-owned life insurance, and a decrease in compensation and benefits.

• Earnings (loss) per share were $0.91 for 4Q24, $0.72 for 3Q24, and $(0.16) for 4Q24.

• Net interest income was $7.4 million during 4Q24, a 4.50% increase from 3Q24's $7.0 million. This also is a 7.09% increase from 4Q23's $6.9 million net interest income. The change from the same quarter a year ago was primarily due to:

  • Interest and dividend income of $12.1 million in 4Q24, compared to $10.8 million in 4Q23.

• Tax equivalent net interest margin decreased slightly to 3.35% for 4Q24 from 3.38% for 3Q24, while increasing from the 3.28% margin in 4Q23.

• During 4Q24, there was a reversal of the allowance for credit losses of $216,000, due to annual historic loss updates, qualitative factor adjustments, and lower specific reserves. During 3Q24, there was also a reversal of the allowance of $28,000, while $993,000 was provided to the allowance for credit losses in 4Q23.

• Noninterest income totaled $2.4 ($2.398) million during 4Q24, a 1.32% increase from 3Q24's $2.4 ($2.367) million, and a 22.50% increase from for 4Q23's $2.0 million. This fluctuation from 4Q23 was primarily due to:

  • Earnings on cash value of bank-owned life insurance for 4Q24 were $541,000, compared to $100,000 for 4Q23.

• Noninterest expenses totaled $7.7 million during 4Q24, a 1.37% increase from 3Q24's $7.6 million, while an 8.33% decrease from 4Q23's $8.4 million. This fluctuation from 4Q23 was primarily due to:

  • Compensation and benefits in 4Q24 were $4.2 million, compared to $5.4 million for 4Q23. Most of this difference was due to one-time expenses associated with the retirement of the former President and CEO.

Full-Year Income Statement Highlights

• Net income for 2024 was $2.8 million, compared to $6.0 million for 2023, as further discussed below.

• Earnings per share were $1.32 for 2024 and $2.81 for 2023.

• Net interest income was $28.0 million for 2024, a 1.70% decrease from 2023's $28.5 million. This decrease was primarily due to:

  • Although interest and dividend income increased $5.9 million to $46.7 million in 2024 compared to $40.8 million in 2023, interest expense increased $6.4 million to $18.7 million in 2024 compared to $12.3 million in 2023.

• During 2024, $4.6 million was provided to the allowance for credit losses, compared to $1.3 million for 2023. This increase was primarily due to:

  • A one-time charge-off of one customer's loans totaling $5.5 million occurred in 1Q24.

• Noninterest income totaled $10.1 million for 2024, compared to $8.9 million for 2023. This 13.14% increase was primarily comprised of:

  • Investment brokerage commission income of $2.6 million in 2024, compared to $2.2 million in 2023.

  • Mortgage banking activities of $1.8 million in 2024, compared to $1.5 million in 2023.

  • Gain on termination of interest rate swaps of $1.1 million in 2024, compared to $793,000 in 2023.

• Noninterest expenses totaled $30.4 million in 2024, compared to $29.0 million in 2023. This 4.73% increase was primarily comprised of:

  • Compensation and benefits expense of $17.7 million in 2024, compared to $17.5 million in 2023.

  • Occupancy and equipment expense of $4.3 million in 2024, compared to $3.7 million in 2023.

  • Data processing expense of $1.3 million in 2024, compared to $1.0 million in 2023.

Balance Sheet Highlights

• Total assets increased to $956 million as of the end of 4Q24, a 0.87% increase from the end of 3Q24's $948 million, and a 4.02% increase from then end of 4Q23's $919 million. These net increases were comprised of:

  • Cash and cash equivalents ended 4Q24 at $20.8 million, compared to $23.8 million as of the end of 3Q24, and $40.0 million as of the end of 4Q23.

  • Securities - available-for-sale increased to $77.1 million, compared to $80.9 million as of the end of 3Q24, and $52.7 million as of the end of 4Q23.

  • Net loans ended 4Q24 at $768 million, compared to $753 million as of the end of 3Q24, and $739 million as of the end of 4Q23.

• Total deposits as of the end of 4Q24 were $814 million, compared to $809 million as of the end of 3Q24, and $799 million as of the end of 4Q23. These net increases were comprised of:

  • Noninterest-bearing deposits decreased to $158 million as of the end of 4Q24, from $162 million as of the end of 3Q24, and $160 million as of the end of 4Q23.

  • Interest-bearing deposits increased to $656 million as of the end of 4Q24, from $647 million as of the end of 3Q24, and $639 million as of the end of 4Q23.

• Borrowed funds increased to $61.1 million as of the end of 4Q24, from $57.0 million as of the end of 3Q24, and $40.0 million as of the end of 4Q23.

• Total equity at the end of 4Q24 was $55.4 million, compared to $55.5 million as of the end of 3Q24, and $55.8 million as of the end of 4Q23.

• Book value per share was $25.66 ($21.51 tangible) at the end of 4Q24, compared to $25.74 ($21.55 tangible) as of the end of 3Q24, and $25.94 ($21.84 tangible) as of the end of 4Q23.

About Sturgis Bancorp, Inc.

Sturgis Bancorp, Inc. is the holding company for Sturgis Bank & Trust Company (the Bank), and its subsidiaries: Oakleaf Financial Services, Oak Mortgage, Ayres/Oak Insurance, and Oak Title Services. The Bank provides a full array of trust, commercial, and consumer banking services from banking centers in: Sturgis, Bangor, Bronson, Centreville, Climax, Colon, Marshall, Niles, Portage, South Haven, St. Joseph, Three Rivers, and White Pigeon, Michigan. Oakleaf Financial Services offers a complete range of investment and financial-advisory services. Oakleaf Mortgage offers residential mortgages in all markets of the Bank. Ayres/Oak Insurance offers various competitive commercial and consumer insurance products. Oak Title Services offers commercial and consumer title insurance services.

Forward-Looking Statements

This release contains statements that constitute forward-looking statements. These statements appear in several places in this release and include statements regarding intent, belief, outlook, objectives, efforts, estimates, or expectations of Sturgis Bancorp, Inc. (Bancorp), primarily with respect to future events and the future financial performance of Bancorp. Any such forward-looking statements are not guarantees of future events or performance and involve risks and uncertainties, and actual results may differ materially from those in the forward-looking statements. Factors that could cause a difference between an ultimate actual outcome and a preceding forward-looking statement include, but are not limited to, changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking laws and regulations; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; government and regulatory policy changes; the outcome of any pending or future litigation and contingencies; trends in consumer behavior and ability to repay loans; and changes in the world, national, and local economies. Bancorp undertakes no obligation to update, amend, or clarify forward-looking statements as a result of new information, future events, or otherwise. The numbers presented herein are unaudited.

For additional information, visit our website at www.sturgis.bank.

Sturgis Bancorp, Inc. Contacts

• Jason J. Hyska, CEO & President, or Brian P. Hoggatt, CFO - (269) 651-9345

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited - Amounts in thousands, except share and per share data)

		Three Months Ended
		Dec 31,				Sep 30,				Dec 31,
		2024				2024				2023
		4Q24				3Q24				4Q23
Interest and dividend income
Loans (including fees)		$	10,981			$	10,819			$	10,056
Investment securities:
Taxable			827				906				506
Tax-exempt			38				39				69
Dividends			224				190				139
Total interest and dividend income			12,070				11,954				10,770
Interest expense
Deposits			3,956				3,686				3,496
Borrowed funds			763				1,233				410
Total interest expense			4,719				4,919				3,906
Net interest income			7,351				7,035				6,864
Credit loss expense (benefit)			(216	)			(28	)			993
Net interest income, after credit loss expense			7,567				7,063				5,871
Noninterest income
Service charges on deposits and other fees			337				356				345
Interchange income			336				375				328
Investment brokerage commission income			697				646				606
Mortgage banking activitives			262				588				420
Trust fee income			115				97				76
Earnings on cash value of bank-owned life insurance			541				111				100
Gain on sale of real estate owned, net			2				47				2
Proportionate net income from unconsolidated subsidiaries			92				100				67
Other income			16				47				14
Total noninterest income			2,398				2,367				1,958
Noninterest expenses
Compensation and benefits			4,212				4,559				5,412
Occupancy and equipment			1,103				1,063				992
Interchange expenses			203				174				179
Data processing			425				318				187
Professional services			165				125				177
Advertising			190				223				185
FDIC premiums			187				176				152
Other expenses			1,185				933				1,082
Total noninterest expenses			7,670				7,571				8,366
Income (loss) before income tax expense (benefit)			2,295				1,859				(537	)
Income tax expense (benefit)			330				316				(187	)
Net income (loss)		$	1,965			$	1,543			$	(350	)
Earnings (loss) per share		$	0.91			$	0.72			$	(0.16	)
Dividends per share		$	0.17			$	0.17			$	0.17

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited - Amounts in thousands, except share and per share data)

		Full-Year Ended
		Dec 31,				Dec 31,
		2024				2023
Interest and dividend income
Loans (including fees)		$	42,534			$	37,964
Investment securities:
Taxable			3,298				1,965
Tax-exempt			177				361
Dividends			733				479
Total interest and dividend income			46,742				40,769
Interest expense
Deposits			15,170				10,725
Borrowed funds			3,553				1,542
Total interest expense			18,723				12,267
Net interest income			28,019				28,502
Credit loss expense			4,585				1,269
Net interest income, after credit loss expense			23,434				27,233
Noninterest income
Service charges on deposits and other fees			1,372				1,356
Interchange income			1,369				1,349
Investment brokerage commission income			2,578				2,203
Mortgage banking activitives			1,823				1,484
Trust fee income			465				365
Earnings on cash value of bank-owned life insurance			867				887
Gain on sale of real estate owned, net			77				56
Gain on termination of interest rate swap			1,070				793
Proportionate net income from unconsolidated subsidiaries			365				224
Other income			92				190
Total noninterest income			10,078				8,907
Noninterest expenses
Compensation and benefits			17,680				17,459
Occupancy and equipment			4,260				3,739
Interchange expenses			708				650
Data processing			1,319				988
Professional services			580				525
Advertising			827				723
FDIC premiums			741				675
Other expenses			4,239				4,224
Total noninterest expenses			30,354				28,983
Income before income tax expense			3,158				7,157
Income tax expense (benefit)			323				1,139
Net income		$	2,835			$	6,018
Earnings per share		$	1.32			$	2.81
Dividends per share		$	0.68			$	0.68

CONSOLIDATED BALANCE SHEETS
(Unaudited - Amounts in thousands, except share and per share data)

		Dec 31,				Sep 30,				Dec 31,
		2024				2024				2023
		4Q24				3Q24				4Q24
ASSETS
Cash and due from banks		$	10,628			$	12,642			$	10,243
Other short-term investments			10,174				11,199				29,766
Total cash and cash equivalents			20,802				23,841				40,009
Securities - available-for-sale			77,072				80,867				52,658
Securities - held-to-maturity			19,442				19,722				20,866
Federal Home Loan Bank stock			9,786				9,786				7,295
Loans held for sale			3,658				3,664				2,259
Loans, net of allowance for credit losses of $9,289; $9,484;
and $10,198 at 4Q24; 3Q24; and 4Q23, respectively			768,430				752,660				739,461
Premises and equipment, net			18,708				18,546				19,136
Goodwill			5,834				5,834				5,834
Mortgage servicing rights			3,121				3,198				2,979
Real estate owned			152				151				130
Bank-owned life insurance			15,402				16,158				15,832
Accrued interest receivable			3,405				3,504				3,099
Other assets			10,577				10,201				9,914
Total assets		$	956,389			$	948,132			$	919,472
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits
Noninterest-bearing		$	157,782			$	162,254			$	159,899
Interest-bearing			656,077				646,734				639,039
Total deposits			813,859				808,988				798,938
Federal Home Loan Bank advances and other borrowings			61,100				57,000				40,000
Subordinated debentures - $15,000 face amount (less
unamortized debt issuance costs of $81; $102; and $164
at 4Q24; 3Q24; and 4Q23, respectively)			14,919				14,898				14,836
Accrued interest payable			2,600				2,190				1,654
Other liabilities			8,502				9,540				8,276
Total liabilities			900,980				892,616				863,704
Stockholders' equity
Common stock - $1 par value: authorized - 9,000,000 shares;
issued and outstanding - 2,159,191 shares at 4Q24;
2,156,941 shares at 3Q24; and 2,150,191 shares at 4Q23			2,159				2,157				2,150
Additional paid-in capital			8,699				8,660				8,556
Retained earnings			53,398				51,801				52,029
Accumulated other comprehensive (loss)			(8,847	)			(7,102	)			(6,967	)
Total stockholders' equity			55,409				55,516				55,768
Total liabilities and stockholders' equity		$	956,389			$	948,132			$	919,472

SOURCE: Sturgis Bancorp, Inc.

View the original press release on ACCESS Newswire

FAQ

What caused STBI's net income to decline in 2024 compared to 2023?

STBI's net income declined to $2.8M in 2024 from $6.0M in 2023 primarily due to a $5.5M charge-off from one customer's loans in Q1 2024 and increased credit loss provisions of $4.6M.

How did STBI's Q4 2024 performance compare to Q4 2023?

Q4 2024 showed significant improvement with $2.0M net income compared to a $350,000 loss in Q4 2023, driven by increased net interest income and lower compensation expenses.

What were STBI's key deposit trends in 2024?

STBI's total deposits increased by $15M in 2024, reaching $814M, with interest-bearing deposits growing to $656M while non-interest bearing deposits slightly decreased to $158M.

How much did STBI pay in dividends during 2024?

STBI paid total quarterly dividends of $0.68 per share during 2024, with the most recent quarterly dividend being $0.17 per share.