Morris State Bancshares Announces Quarterly Earnings, Announces Retirement of Subordinated Debt and Declares Third Quarter Dividend
DUBLIN, Ga., July 29, 2025 (GLOBE NEWSWIRE) -- Morris State Bancshares, Inc. (OTCQX:MBLU) (the "Company"), the parent of Morris Bank (the "Bank"), today announced net income of $6.0 million for the quarter ending June 30, 2025, representing an increase of $1.1 million, or 22.10%, compared to net income of $4.9 million for the quarter ended March 31, 2025. Compared to the same quarter a year ago, net income increased by $677 thousand, or 12.71%, from $5.3 million for the quarter ending June 30, 2024. Net interest income before provision for credit losses increased from the linked and prior year quarters by $744 thousand and $2.7 million, respectively.
"The Company delivered solid second quarter results, driven by continued net interest margin expansion and steady balance sheet growth," said Spence Mullis, Chairman and CEO. "Our net interest margin at the end of June was 4.43%, an increase of 14 basis points from the linked quarter and 41 basis points higher than the same quarter a year ago. The average yield on earning assets grew 13 basis points during the second quarter from 6.07% to 6.20%, while the Bank's cost of funds increased 1 basis point from 1.97% to 1.98% during the same period. While we experienced significant payoffs during the quarter, our loan portfolio expanded by $16.0 million, or 1.41% for the quarter, an annualized growth rate of approximately 5.7%. Deposits increased by $24.8 million, or 1.91% for the quarter, which equates to an annualized growth rate of roughly 7.8%. As previously communicated, it was our intention to pay off the Company's remaining subordinated debt as soon as the opportunity became available. We're pleased to report that on July 22, 2025, we retired the full $15.0 million. This will result in significant interest expense savings for the Company going forward."
The Bank's allowance for credit losses as a percentage of total loans was 1.28% for June 30, 2025, as compared to 1.30% for March 31, 2025, and 1.30% for June 30, 2024. The Bank's adversely classified index increased during the quarter from 4.66% as of March 31, 2025, to 9.51% as of June 30, 2025. The quarterly change was concentrated in one loan relationship. Overall, classified assets levels remain below historical trends.
The Bank's efficiency ratio improved to 50.97% for the quarter ending June 30, 2025, from 57.97% at March 31, 2025 and 58.36% at June 30, 2024. Noninterest expense declined by $287,000, or 3.00%, compared to the quarter ending March 31, 2025. This decrease was driven by lower salary and benefits costs, along with several routine operating expenses coming in below budget. Provision for income taxes increased $407 thousand, or 27.58%, as a result of higher pre-tax income.
The Company's total shareholders' equity increased 2.53% during the quarter to $203 million as of June 30, 2025, and up 8.97%, or $16.7 million, from June 30, 2024. The tangible book value of the Company grew to $18.06 as of June 30, 2025, from $17.66 as of March 31, 2025, and was up 9.26% from $16.53 as of June 30, 2024. On July 17, 2025, the board of directors approved a third quarter dividend of $0.12 per share payable on or about September 15, 2025, to all shareholders of record as of August 15, 2025.
Forward-looking Statements
Certain statements contained in this release may not be based on historical facts and are forward-looking statements. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as "anticipate," "believe," "estimate," "expect," "may," "might," "will," "would," "could" or "intend." We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including, among others, the business and economic conditions; risks related to the integration of acquired businesses and any future acquisitions; changes in management personnel; interest rate risk; ability to execute on planned expansion and organic growth; credit risk and concentrations associated with the Company's loan portfolio; asset quality and loan charge-offs; inaccuracy of the assumptions and estimates management of the Company makes in establishing reserves for probable loan losses and other estimates; lack of liquidity; impairment of investment securities, goodwill or other intangible assets; the Company's risk management strategies; increased competition; system failures or failures to prevent breaches of our network security; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes; and increases in capital requirements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.
MORRIS STATE BANCSHARES, INC.
AND SUBSIDIARIES
Consolidating Balance Sheet
June 30,
March 31,
June 30,
2025
2025
Change
% Change
2024
Change
% Change
(Unaudited)
(Unaudited)
(Unaudited)
ASSETS
Cash and due from banks
$
106,289,134
$
92,342,678
$
13,946,456
15.10
%
$
43,688,884
$
62,600,250
143.29
%
Federal funds sold
24,863,860
15,606,716
9,257,144
59.32
%
14,624,710
10,239,150
70.01
%
Total cash and cash equivalents
131,152,994
107,949,394
23,203,600
21.49
%
58,313,594
72,839,400
124.91
%
Interest-bearing time deposits in other banks
100,000
100,000
--
0.00
%
100,000
--
0.00
%
Securities available for sale, at fair value
9,805,608
9,414,147
391,461
4.16
%
7,669,642
2,135,966
0.00
%
Securities held to maturity, at cost (net of CECL Reserve)
205,814,736
208,561,077
(2,746,341
)
-1.32
%
227,532,821
(21,718,085
)
-9.55
%
Federal Home Loan Bank stock, restricted, at cost
1,084,200
1,084,200
--
0.00
%
1,027,800
56,400
5.49
%
Loans, net of unearned income
1,155,735,771
1,139,719,828
16,015,943
1.41
%
1,081,790,223
73,945,548
6.84
%
Less-allowance for credit losses
(14,816,647
)
(14,829,709
)
13,062
-0.09
%
(14,109,191
)
(707,456
)
5.01
%
Loans, net
1,140,919,124
1,124,890,119
16,029,005
1.42
%
1,067,681,032
73,238,092
6.86
%
-
Bank premises and equipment, net
14,720,155
14,844,597
(124,442
)
-0.84
%
13,051,972
1,668,183
12.78
%
ROU assets for operating lease, net
601,700
692,339
(90,639
)
-13.09
%
945,268
(343,568
)
-36.35
%
Goodwill
9,361,704
9,361,704
--
0.00
%
9,361,704
--
0.00
%
Intangible assets, net
1,167,611
1,253,288
(85,677
)
-6.84
%
1,508,214
(340,603
)
-22.58
%
Other real estate and foreclosed assets
3,300
15,503
(12,203
)
-78.71
%
43,408
(40,108
)
-92.40
%
Accrued interest receivable
6,760,207
6,369,932
390,275
6.13
%
6,421,999
338,208
5.27
%
Cash surrender value of life insurance
15,340,444
15,233,512
106,932
0.70
%
14,915,967
424,477
2.85
%
Other assets
17,574,139
21,726,495
(4,152,356
)
-19.11
%
21,721,225
(4,147,086
)
-19.09
%
Total Assets
$
1,554,405,922
$
1,521,496,307
$
32,909,615
2.16
%
$
1,430,294,646
124,111,276
8.68
%
LIABILITIES AND SHAREHOLDERS' EQUITY
