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First Resource Bank (Pennsylvania)

FIRST RESOURCE BANCORP, INC. ANNOUNCES 2025 SECOND QUARTER RESULTS; NET INCOME GREW 41% OVER PRIOR YEAR, NET INTEREST MARGIN EXPANDS

EXTON, Pa. , July 23, 2025 /PRNewswire/ -- First Resource Bancorp, Inc. (OTCQX: FRSB), the holding company for First Resource Bank, announced financial results for the three months ended June 30, 2025. 

Lauren C. Ranalli, President and CEO, stated, "The second quarter of 2025 marked the most profitable quarter in the Bank's history, capping off a record breaking first half of the year. This exceptional performance was fueled by a widening net interest margin and sustained growth in loans and deposits. Management's disciplined approach to pricing across the balance sheet has generated significant net interest margin expansion - from 3.50% in the fourth quarter of 2024, to 3.60% in the first quarter of 2025 and now 3.72% in the second quarter of 2025. With total assets approaching the $700 million threshold, each additional basis point of margin expansion contributes significantly to our bottom line."

Highlights for the second quarter of 2025 included:

  • Net income of $1.9 million exceeded the prior year by 41% and the prior quarter by 13%
  • Net interest margin expanded 12 basis points over the prior quarter to 3.72%
  • Total interest income grew 14% over the prior year second quarter
  • Net interest income grew 19% over the prior year second quarter
  • Earnings per share grew 43% over the prior year second quarter to $0.63 per share
  • Total loans grew 3% during the second quarter, or 13% annualized
  • Total deposits grew 4% during the second quarter, or 18% annualized
  • Book value per share grew 4% to $18.00 during the second quarter
  • Total assets grew $22.0 million, or 3%, ending the quarter at $697.3 million
  • Non-performing assets to total assets remain low at 0.03%
  • Named a "Best Places to Work" company by the Philadelphia Business Journal for the seventh consecutive year
  • Named Best Commercial Bank and Best Community Bank by the readers of the Main Line Times for the fifth consecutive year
  • Recognized as one of the top 100 performing community banks in 2024 with under $2 billion in assets in the US by American Banker

Ranalli added, "This record profitability has boosted book value to $18.00 per share as of June 30, 2025. We remain focused on effectively managing the factors that we can control to steadily increase book value per share, with the goal of delivering long-term value to our shareholders."

Net income for the quarter ended June 30, 2025, totaled $1.9 million, or $0.63 per common share, marking a significant increase from $1.7 million, or $0.56 per share, in the previous quarter, and up from $1.3 million, or $0.44 per common share, in the same quarter of 2024. The annualized return on average assets rose to 1.15% for the second quarter of 2025, compared to 0.89% in the second quarter of 2024. Similarly, the annualized return on average equity also improved, reaching 14.38%, up from 11.27% during the same period last year. 

Total interest income for the second quarter of 2025 reached $10.3 million, reflecting a $527 thousand or 5% increase over the prior quarter. This growth was fueled by a 3% increase in loans during the second quarter, coupled with an overall increase in loan yields.

Total interest income increased by $1.3 million, marking a 14% increase from $9.0 million in the second quarter of 2024 to $10.3 million in the corresponding period of 2025. This growth was driven by a 9% year-over-year expansion in loans, complemented by an overall increase in loan yields. 

Total interest income grew $2.6 million, or 15%, from $17.4 million for the six months ended June 30, 2024, to $20.0 million for the corresponding period in 2025. This growth was primarily driven by loan portfolio expansion and an increased rate environment, as previously noted.

Total interest expense rose 3% in the second quarter of 2025 compared to the prior quarter, primarily due to a 2 basis point increase in the cost of money market accounts and greater volumes of money market accounts and time deposits. This was partially offset by a 20 basis point reduction in the cost of time deposits. Additionally, interest expense on borrowings increased by 11%, driven by an increase in the average balance of FHLB borrowings during the second quarter.

Total interest expense increased by 7%, climbing from $4.0 million in the second quarter of 2024 to $4.3 million in the second quarter of 2025. This increase was primarily attributable to greater volumes of interest-bearing deposits, partially offset by a 19 basis point decrease in the cost of interest-bearing deposits year-over-year. Interest expense on subordinated debt grew by 45%, while interest expense on borrowings declined by 50% when compared to the second quarter of 2024.

Total interest expense for the six months ended June 30, 2025 increased by 10%, to $8.5 million, up from $7.8 million in the same period of 2024. Primary factors of this increase include greater volumes of interest-bearing deposits and subordinated debt. These increases were partially offset by a reduction in FHLB borrowings and declines in the cost of funds, including a 12 basis point decrease in cost of money market accounts, a 32 basis point drop in the cost of time deposits, and a 14 basis point decline in cost of FHLB borrowings.

In the second quarter of 2025, net interest income grew by $409 thousand, or 7%, compared to the previous quarter. The net interest margin also improved, rising to 3.72% from 3.60% in the first quarter of 2025. The overall yield on interest-earning assets climbed by 8 basis points, primarily driven by an 8 basis point increase in loan yields to 6.55% for the quarter. Meanwhile, the cost of interest-bearing deposits declined 3 basis points to 3.36%, primarily due to a 20 basis point drop in the cost of time deposit accounts. This decrease was partially offset by a 2 basis point rise in money market rates and higher volumes in those categories. As a result, the total cost of deposits fell by 3 basis points for the quarter, from 2.85% to 2.82%.

Net interest income for the six months ended June 30, 2025, totaled $11.5 million, reflecting a 19% improvement from $9.6 million for the same period in 2024. This growth was fueled by a $2.6 million, or 15%, increase in loan interest income and a $116 thousand, or 42%, decline in interest expense on borrowings, partially offset by an $829 thousand, or 11%, increase in deposit interest expense and an $83 thousand, or 45%, increase in interest expense on subordinated debt.

The provision for credit losses in the second quarter of 2025 was $130 thousand, down from $174 thousand in the prior quarter. A charge-off amounting to $47 thousand in the second quarter of 2025 had been previously reserved and, as such, did not affect the provision for the quarter. Year over year, the provision for credit losses fell $116 thousand from $246 thousand in the second quarter of 2024 to $130 thousand in the second quarter of 2025. The higher provision for credit losses in the second quarter of 2024 was due to a $204 thousand charge-off related to a single loan relationship.

As of June 30, 2025, the allowance for credit losses to total loans stood at 0.76%, down from 0.93% as of December 31, 2024. The reserve decreased due to a first-quarter charge-off of a previously reserved credit. Non-performing assets, consisting solely of non-performing loans, totaled $215 thousand as of June 30, 2025, down from $262 thousand at the end of the prior quarter. There were no non-performing assets as of June 30, 2024. Non-performing assets to total assets stood at 0.03% as of June 30, 2025, compared to 0.19% as of December 31, 2024, and 0.00% at June 30, 2024.

Non-interest income totaled $372 thousand in the second quarter of 2025, representing a 7% increase from $349 thousand in the previous quarter, and a 28% increase from $291 thousand in the same period of 2024. Notably, swap referral fee income contributed $108 thousand in the second quarter of 2025, up from $24 thousand in the first quarter of 2025 and $62 thousand in the second quarter of 2024. Gains on the sale of SBA loans totaled $26 thousand in the second quarter of 2025, compared to $87 thousand in the previous quarter, and none in the second quarter of 2024.

Non-interest income for the six months ended June 30, 2025, totaled $722 thousand, up from $687 thousand in the same period of 2024. Swap referral fee income was $132 thousand in the first half of 2025, compared to $245 thousand in the first half of 2024. Gains on the sale of SBA loans totaled $113 thousand in the first half of 2025, whereas no such gains were recorded in the prior year period.

Non-interest expenses increased $202 thousand, or 6%, in the second quarter of 2025 compared to the prior quarter. This increase was driven by higher salaries & benefits, professional fees, advertising, data processing, and other costs. However, these increases were partially offset by decreases in occupancy & equipment. 

Non-interest expenses increased $455 thousand, or 14%, in the second quarter of 2025 compared to the same period in 2024. Increases in salaries & benefits, professional fees, advertising, data processing, and other costs were partially offset by a decrease in occupancy & equipment costs. The ratio of non-interest expenses to average assets was 2.29% in the second quarter of 2025, up from 2.25% in the previous quarter and up from 2.21% in the second quarter of the prior year.

Non-interest expenses for the six months ended June 30, 2025, were $7.4 million compared to $6.7 million for the same period in the prior year. The increase of $729 thousand, or 11%, was mostly attributed to increases in salaries & benefits associated with an expanded workforce, along with professional fees, advertising, data processing, and other expenses.

Total deposits increased by $25.8 million, or 4% during the second quarter of 2025, rising from $574.0 million as of March 31, 2025, to $599.7 million on June 30, 2025. Noninterest-bearing deposits rose by 6% in the second quarter, increasing $6.0 million to $99.4 million, up from $93.4 million in the previous quarter. Interest-bearing checking balances declined by $3.1 million, or 7%, to $43.6 million, down from $46.8 million in the prior quarter. Money market deposits grew $6.6 million, or 3%, rising from $250.1 million at the end of the first quarter of 2025, to $256.7 million by the close of the second quarter, while time deposits grew $16.3 million, or 9%, from $183.7 million on March 31, 2025, to $200.0 million on June 30, 2025.

Between June 30, 2024, and June 30, 2025, total deposits grew 12%, driven by increases in interest-bearing checking accounts, money markets, and time deposits. This growth was partially offset by a decline in noninterest-bearing deposits. As of June 30, 2025, approximately 81% of total deposits were insured or otherwise collateralized, down from 82% in the prior quarter.

The loan portfolio expanded by $19.8 million, representing a 3% increase, from $605.0 million on March 31, 2025, to $624.8 million on June 30, 2025, with strong growth in all loan categories. Year-to-date, total loans grew $26.3 million, or 4%, reflecting continued strength and diversification in lending activity.

Between June 30, 2024, and June 30, 2025, total loans expanded by 9%, with strong growth noted in all commercial loan categories.

The following table illustrates the composition of the loan portfolio:

Jun. 30,

2025

Dec. 31,

2024

Jun. 30,

2024





Commercial real estate

$   487,283,100

$   480,933,654

$   457,437,009

Commercial construction

52,208,827

39,760,197

42,138,883

Commercial business

66,271,853

59,862,802

55,316,506

Consumer

19,037,313

17,907,914

18,697,974





Total loans

$   624,801,093

$   598,464,567

$   573,590,372

Investment securities totaled $16.5 million on June 30, 2025, compared to $16.8 million on March 31, 2025. The held-to-maturity investment portfolio had a book value of $8.5 million and a fair market value of $7.5 million, resulting in an unrealized loss of $961 thousand, compared to an unrealized loss of $1.0 million as of March 31, 2025. After tax, this loss amounts to $759 thousand, representing approximately 1.4% of total equity as of June 30, 2025. The remainder of the investment portfolio was classified as available-for-sale, with a book value of $9.0 million and a fair value of $8.0 million, resulting in an unrealized loss of $970 thousand, compared to $1.1 million as of March 31, 2025. This unrealized loss, net of tax, totals $766 thousand and is reflected in accumulated other comprehensive loss on the balance sheet.

On August 12, 2024, the Company announced a stock repurchase program authorizing the repurchase of up to 155,922 shares of its common stock. During the quarter ended June 30, 2025, the Company repurchased 1,328 shares at a total cost of $19 thousand and an average price of $14.25 per share, a significant discount to book value per share of $18.00 at the end of the second quarter. As of June 30, 2025, 48,431 shares remained available for repurchase under the program which is scheduled to expire on July 16, 2025.

Total stockholders' equity increased by $2.0 million, or 4%, rising from $52.0 million on March 31, 2025, to $54.0 million on June 30, 2025, largely driven by net income. During the quarter ended June 30, 2025, book value increased by 66 cents, or 4%, reaching $18.00 per share.

 

Selected Financial Data:
Consolidated Balance Sheets (unaudited)


June 30,
2025

December 31,
2024




Cash and due from banks

$    34,917,531

$    17,837,920

Time deposits at other banks

100,000

100,000

Investments

16,473,298

26,611,867

Loans

624,801,093

598,464,567

Allowance for credit losses

(4,733,781)

(5,574,679)

Premises & equipment

7,561,092

7,551,410

Other assets

18,141,421

18,593,449




Total assets

$  697,260,654

$  663,584,534




Noninterest-bearing deposits

$    99,411,113

$    86,581,276

Interest-bearing checking

43,620,103

40,119,102

Money market

256,694,537

239,828,130

Time deposits

200,018,778

185,697,340

  Total deposits

599,744,531

552,225,848

Short term borrowings

20,000,000

40,000,000

Long term borrowings

8,210,000

6,250,000

Subordinated debt

8,481,329

8,473,216

Other liabilities

6,830,863

6,341,010




Total liabilities

643,266,723

613,290,074




Common stock

3,100,773

3,100,773

Surplus

19,855,264

19,852,352

Treasury stock

(1,409,115)

(1,316,876)

Accumulated other comprehensive loss

(766,374)

(964,821)

Retained earnings

33,213,383

29,623,032




Total stockholders' equity

53,993,931

50,294,460




Total liabilities &

     stockholders' equity

$  697,260,654

$  663,584,534

 

Performance Statistics
(unaudited)


Qtr Ended

Jun. 30,

2025

Qtr Ended

Mar. 31,

2025

Qtr Ended

Dec. 31,

2024

Qtr Ended

Sep. 30,

2024

Qtr Ended

Jun. 30,

2024







Net interest margin

3.72 %

3.60 %

3.50 %

3.43 %

3.43 %







Nonperforming loans/

   total loans

0.03 %

0.04 %

0.21 %

0.00 %

0.00 %







Nonperforming assets/

   total assets

0.03 %

0.04 %

0.19 %

0.00 %

0.00 %







Allowance for credit losses/

   total loans

0.76 %

0.77 %

0.93 %

0.76 %

0.77 %







Average loans/average

   assets

93.3 %

93.0 %

93.2 %

92.9 %

92.7 %







Non-interest expenses*/

   average assets

2.29 %

2.25 %

2.07 %

2.17 %

2.21 %







Efficiency ratio

60.0 %

61.0 %

58.3 %

62.3 %

63.3 %







Earnings per share – basic

   and diluted

$0.63

$0.56

$0.33

$0.53

$0.44







Book value per share

$18.00

$17.34

$16.73

$16.45

$15.78







Total shares outstanding

3,000,028

2,998,977

3,006,039

3,004,689

3,098,431







Weighted average shares
     outstanding

2,999,200

3,003,194

3,005,408

3,055,157

3,097,433


*  Annualized

 

Consolidated Income Statements (unaudited)


Qtr. Ended

Jun. 30,

2025

Qtr. Ended

Mar. 31,

2025

Qtr. Ended

Dec. 31,

2024

Qtr. Ended

Sep. 30,

2024

Qtr. Ended

Jun. 30,

2024







INTEREST INCOME






Loans, including fees

$10,126,623

$9,583,093

$9,512,689

$9,346,895

$8,859,695

Securities

118,920

116,372

115,291

123,678

122,082

Other

28,289

47,421

24,256

25,135

34,964

 Total interest income

10,273,832

9,746,886

9,652,236

9,495,708

9,016,741







INTEREST EXPENSE






Deposits

4,111,978

4,002,995

4,057,530

3,979,691

3,767,011

Borrowings

85,822

77,303

90,767

245,596

173,198

Subordinated debt

134,681

134,682

134,681

120,829

93,124

 Total interest expense

4,332,481

4,214,980

4,282,978

4,346,116

4,033,333







Net interest income

5,941,351

5,531,906

5,369,258

5,149,592

4,983,408







Provision for credit losses

130,416

174,097

1,127,547

13,317

246,273







Net interest income after

provision for credit losses

5,810,935

5,357,809

4,241,711

5,136,275

4,737,135







NON-INTEREST INCOME






Service charges and other fees

97,887

109,360

114,958

94,812

104,748

BOLI income

66,998

65,850

66,248

65,800

59,613

Gain on sale of SBA loans

26,326

86,860

(367)

59,296

-

Swap referral fee income

107,925

24,201

31,030

-

62,460

Other

73,275

62,843

77,225

65,944

64,085

 Total non-interest income

372,411

349,114

289,094

285,852

290,906







NON-INTEREST EXPENSE






Salaries & benefits

2,253,069

2,127,037

1,948,007

1,999,957

1,944,755

Occupancy & equipment

318,631

334,698

336,629

368,339

362,850

Professional fees

192,378

150,176

109,819

128,748

130,767

Advertising

113,923

108,721

77,809

76,383

81,510

Data processing

207,430

204,492

201,671

189,429

180,257

Other

705,961

664,334

625,603

622,590

636,589

Total non-interest expense

3,791,392

3,589,458

3,299,538

3,385,446

3,336,728







Income before federal income tax expense

2,391,954

2,117,465

1,231,267

2,036,681

1,691,313







Federal income tax expense

488,827

430,241

223,486

413,607

342,880







Net income

$  1,903,127

$1,687,224

$1,007,781

$1,623,074

$1,348,433

 

Income Statements (unaudited)


Six Months
Ended
Jun. 30,
2025

Six Months
Ended
Jun. 30,
2024




INTEREST INCOME



Loans, including fees

$  19,709,716

$  17,087,797

Securities

235,292

242,795

Other

75,710

66,699

 Total interest income

20,020,718

17,397,291




INTEREST EXPENSE



Deposits

8,114,973

7,286,187

Borrowings

163,125

279,058

Subordinated debt

269,363

186,248

 Total interest expense

8,547,461

7,751,493




Net interest income

11,473,257

9,645,798




Provision for credit losses

304,513

309,924




Net interest income after

provision for credit losses

11,168,744

9,335,874




NON-INTEREST INCOME



Service charges and other fees

207,247

204,912

BOLI income

132,848

110,969

Gain on sale of SBA loans

113,186

-

Swap referral fee income

132,126

244,520

Other

136,118

126,633

 Total non-interest income

721,525

687,034




NON-INTEREST EXPENSE



Salaries & benefits

4,380,106

3,989,838

Occupancy & equipment

653,329

652,052

Professional fees

342,554

268,249

Advertising

222,644

163,255

Data processing

411,922

356,942

Other

1,370,295

1,221,515

Total non-interest expense

7,380,850

6,651,851




Income before federal income tax expense

4,509,419

3,371,057




Federal income tax expense

919,068

691,687




Net income

$    3,590,351

$    2,679,370

About First Resource Bancorp, Inc.

First Resource Bancorp, Inc. is the holding company of First Resource Bank. First Resource Bank is a locally owned and operated Pennsylvania state-chartered bank with three full-service branches, serving the banking needs of businesses, professionals and individuals in the Delaware Valley. The Bank offers a full range of deposit and credit services with a high level of personalized service. First Resource Bank also offers a broad range of traditional financial services and products, competitively priced and delivered in a responsive manner to small businesses, professionals and residents in the local market. For additional information visit our website at www.firstresourcebank.com. Member FDIC.

This press release contains statements that are not of historical facts and may pertain to future operating results or events or management's expectations regarding those results or events. These are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts. When used in this press release, the words "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates", or words of similar meaning, or future or conditional verbs, such as "will", "would", "should", "could", or "may" are generally intended to identify forward-looking statements. These forward-looking statements are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are either beyond our control or not reasonably capable of predicting at this time. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the results discussed in these forward-looking statements. Readers of this press release are accordingly cautioned not to place undue reliance on forward-looking statements. First Resource Bank disclaims any intent or obligation to update publicly any of the forward-looking statements herein, whether in response to new information, future events or otherwise.                 

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SOURCE First Resource Bank