First US Bancshares, Inc. Reports Second Quarter 2025 Results
BIRMINGHAM, Ala., July 30, 2025 /PRNewswire/ -- Second Quarter Highlights:
First US Bancshares, Inc. (NASDAQ:FUSB) (the "Company"), the parent company of First US Bank (the "Bank"), today reported net income of $0.2 million, or $0.03 per diluted share, for the quarter ended June 30, 2025 ("2Q2025"), compared to $1.8 million, or $0.29 per diluted share, for the quarter ended March 31, 2025 ("1Q2025") and $2.1 million, or $0.34 per diluted share, for the quarter ended June 30, 2024 ("2Q2024"). For the six months ended June 30, 2025, net income totaled $1.9 million, or $0.32 per diluted share, compared to $4.2 million, or $0.68 per diluted share, for the six months ended June 30, 2024. The decrease in net income in both 2Q2025 and the six months ended June 30, 2025, compared to the previous periods, resulted primarily from an increase in the Company's provision for credit losses on loans and leases.
The table below summarizes selected financial data for each of the periods presented.
Quarter Ended
Six Months Ended
2025
2024
2025
2024
June30,
March 31,
December31,
September30,
June30,
June30,
June30,
Results of Operations:
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Interest income
$
14,854
$
14,018
$
14,420
$
15,017
$
14,546
$
28,872
$
28,823
Interest expense
5,378
5,121
5,672
5,832
5,370
10,499
10,607
Net interest income
9,476
8,897
8,748
9,185
9,176
18,373
18,216
Provision for credit losses
2,717
528
470
152
-
3,245
—
Net interest income after provision for credit losses
6,759
8,369
8,278
9,033
9,176
15,128
18,216
Non-interest income
849
875
982
901
835
1,724
1,700
Non-interest expense
7,444
6,918
6,947
6,990
7,272
14,362
14,419
Income before income taxes
164
2,326
2,313
2,944
2,739
2,490
5,497
Provision for income taxes
9
554
599
722
612
563
1,263
Net income
$
155
$
1,772
$
1,714
$
2,222
$
2,127
$
1,927
$
4,234
Per Share Data:
Basic net income per share
$
0.03
$
0.30
$
0.30
$
0.38
$
0.36
$
0.33
$
0.72
Diluted net income per share
$
0.03
$
0.29
$
0.29
$
0.36
$
0.34
$
0.32
$
0.68
Dividends declared
$
0.07
$
0.07
$
0.07
$
0.05
$
0.05
$
0.14
$
0.10
Key Measures (Period End):
Total assets
$
1,143,379
$
1,126,967
$
1,101,086
$
1,100,235
$
1,083,313
Tangible assets (1)
1,135,932
1,119,502
1,093,602
1,092,733
1,075,781
Total loans
871,431
848,335
823,039
803,308
819,126
Allowance for credit losses ("ACL") on loans andleases
11,388
10,405
10,184
10,116
10,227
Investment securities, net
157,137
161,946
168,570
145,044
144,876
Total deposits
986,846
961,952
972,557
981,149
954,455
Short-term borrowings
35,000
45,000
10,000
-
15,000
Long-term borrowings
10,909
10,890
10,872
10,854
10,836
Total shareholders' equity
101,892
101,231
98,624
98,491
93,836
Tangible common equity (1)
94,445
93,766
91,140
90,989
86,304
Book value per common share
17.70
17.64
17.31
17.23
16.34
Tangible book value per common share (1)
16.41
16.34
16.00
15.92
15.03
Key Ratios:
Return on average assets (annualized)
0.06
%
0.66
%
0.63
%
0.82
%
0.80
%
0.35
%
0.80
%
Return on average common equity (annualized)
0.61
%
7.21
%
6.92
%
9.21
%
9.23
%
3.86
%
9.24
%
Return on average tangible common equity(annualized) (1)
0.66
%
7.79
%
7.49
%
9.99
%
10.05
%
4.17
%
10.06
%
Pre-tax pre-provision net revenue to average assets(annualized) (1)
1.03
%
1.06
%
1.02
%
1.14
%
1.03
%
1.05
%
1.04
%
Net interest margin
3.59
%
3.53
%
3.41
%
3.60
%
3.69
%
3.56
%
3.67
%
Efficiency ratio (2)
72.1
%
70.8
%
71.4
%
69.3
%
72.6
%
71.5
%
72.4
%
Total loans to deposits
88.3
%
88.2
%
84.6
%
81.9
%
85.8
%
Total loans to assets
76.2
%
75.3
%
74.7
%
73.0
%
75.6
%
Common equity to total assets
8.91
%
8.98
%
8.96
%
8.95
%
8.66
%
Tangible common equity to tangible assets (1)
8.31
%
8.38
%
8.33
%
8.33
%
8.02
%
Tier 1 leverage ratio (3)
9.23
%
9.55
%
9.50
%
9.49
%
9.46
%
ACL on loans and leases as % of total loans
1.31
%
1.23
%
1.24
%
1.26
%
1.25
%
Nonperforming assets as % of total assets
0.33
%
0.44
%
0.50
%
0.60
%
0.27
%
Net charge-offs as a percentage of average loans
0.79
%
0.13
%
0.24
%
0.12
%
0.10
%
0.47
%
0.10
%
(1) Refer to the non-GAAP reconciliations beginning on page 10.
(2) Efficiency ratio = non-interest expense / (net interest income + non-interest income)
(3) First US Bank Tier 1 leverage ratio
CEO Commentary
"During the second quarter, we recorded a significant provision for credit losses associated with growth in indirect consumer lending, combined with an uptick in net charge-offs in the category, as well as the application of additional reserves on two individually evaluated commercial loans," stated James F. House, President and CEO of the Company. "While the additional provisioning had a pronounced impact on earnings for both the quarter and year-to-date period, we are encouraged by increases in both net interest margin and total loans during the quarter. Net interest margin expanded by six basis points compared to the previous quarter, and total loans grew by 2.7% during the quarter, bringing year-to-date loan growth to 5.9%. Our pre-tax pre-provision net revenue also increased by 0.9% compared to 1Q2025 and by 5.2% compared to 2Q2024," continued Mr. House. "All of these measures help build a solid base for the future."
Financial Results
Loans and Leases – The table below summarizes loan balances by portfolio category as of the end of each of the most recent five quarters.
Quarter Ended
2025
2024
June30,
March31,
December31,
September 30,
June30,
(Dollars in Thousands)
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Real estate loans:
Construction, land development and other land loans
$48,101
$58,572
$65,537
$53,098
$72,183
Secured by 1-4 family residential properties
67,587
68,523
69,999
70,067
70,272
Secured by multi-family residential properties
118,807
106,374
101,057
100,627
97,527
Secured by non-residential commercial real estate
215,035
214,065
227,751
224,611
218,386
Commercial and industrial loans ("C&I")
40,986
45,166
44,238
44,872
46,249
Consumer loans:
Direct
4,836
4,610
4,774
5,018
5,272
Indirect
376,079
351,025
309,683
305,015
309,237
Total loans and leases held for investment
$871,431
$848,335
$823,039
$803,308
$819,126
Allowance for credit losses on loans and leases
11,388
10,405
10,184
10,116
10,227
Net loans and leases held for investment
$860,043
$837,930
$812,855
$793,192
$808,899
Total loans increased by $23.1 million in 2Q2025, driven primarily by growth of $25.1 million in consumer indirect loans during the quarter. The indirect lending platform focuses on recreational and equipment consumer lending on the higher end of the credit spectrum. Collateral financed in the indirect portfolio primarily includes boats, recreational vehicles, campers, horse trailers and cargo trailers. The weighted average credit score of new indirect loans financed during the six months ended June 30, 2025 was 798, while the weighted average credit score for the entire portfolio was 781. In addition to the indirect portfolio, the Company also grew its multi-family residential real estate loan category by $12.4 million in 2Q2025. Loan growth during 2Q2025 was partially offset by reductions primarily in the construction and C&I categories. Total loan volume averaged $857.7 million during 2Q2025 compared to $824.5 million during 1Q2025 and $819.6 million during 2Q2024. For the six months ended June 30, 2025, average loan balances increased by $20.4 million, or 2.5%, compared to the six months ended June 30, 2024.
Net Interest Income and Margin, Net interest income in 2Q2025 increased by $0.6 million, or 6.5%, compared to 1Q2025 and increased by $0.3 million, or 3.3%, compared to 2Q2024. Net interest margin was 3.59% for 2Q2025 compared to 3.53% for 1Q2025 and 3.69% for 2Q2024. The increase in net interest margin compared to the prior quarter resulted from increased average loan volume, as well as increases in yields on loans and investments. The decrease in net interest margin compared to 2Q2024 resulted primarily from yield reductions on loans that occurred following the reduction of the Federal Funds rate during the latter part of 2024. For the six months ended June 30, 2025, net interest margin was 3.56% compared to 3.67% for the six months ended June 30, 2024.
Provision for Credit Losses, During 2Q2025, the Company recorded a provision for credit losses of $2.7 million, bringing the total provision for credit losses to $3.2 million for the six months ended June 30, 2025. No provision for credit losses was recorded in 2Q2024 or for the six months ended June 30, 2024. In both 2Q2025 and the six months ended June 30, 2025, the provision for credit losses resulted primarily from significant growth in the consumer indirect category, combined with an increase in net charge-offs in the category, as well as from additional reserves on two individually evaluated commercial loans. For 2Q2025, $1.4 million of the provision was associated with the indirect consumer portfolio, while $0.9 million was associated with specific reserves added for the two individually evaluated loans, with the remaining $0.4 million associated with various factors, including changes in economic forecasting data and increases in the allowance for unfunded commitments. For the six months ended June 30, 2025, $2.3 million of the provision was associated with the indirect consumer portfolio, while $0.9 million was associated with specific reserves added for the two individually evaluated loans. As of June 30, 2025, the Company's allowance for credit losses ("ACL") on loans and leases as a percentage of total loans was 1.31%, compared to 1.24% as of December 31, 2024.
Pre-tax Pre-provision Net Revenue ("PPNR") – PPNR totaled $2.9 million in both 2Q2025 and 1Q2025, compared to $2.7 million in 2Q2024. For the six months ended June 30, 2025, PPNR totaled $5.7 million compared to $5.5 million for the six months ended June 30, 2024. As a percentage of average assets, PPNR totaled 1.03% in 2Q2025 compared to 1.06% in 1Q2025 and 1.03% in 2Q2024. For the six months ended June 30, 2025, PPNR as a percentage of average assets was 1.05% compared ...
