Franklin Financial Services (FRAF) - 2024 Q3 - Quarterly Report

Financial Performance - Total interest income for September 2024 was $26,053 thousand, an increase of 29.0$20,154 thousand in September 2023[7]. - Net interest income after credit loss expense for September 2024 was $14,167 thousand, up 10.4$12,832 thousand in September 2023[7]. - Net income for September 2024 was $4,218 thousand, an increase of 9.3$3,859 thousand in September 2023[8]. - Basic earnings per share for September 2024 was $0.96, up from$0.89 in September 2023, reflecting an increase of 7.9%[7]. - Noninterest income for the nine months ended September 2024 was $13,392 thousand, a significant increase from$10,766 thousand in the same period of 2023, representing a growth of 24.0%[7]. - Net income for the nine months ended September 30, 2024, was $10,612,000, compared to$10,127,000 for the same period in 2023, reflecting a year-over-year increase of approximately 4.8%[11]. - Net income for Q3 2024 was $4.2 million ($0.95 per diluted share), a 39.1% increase from Q2 2024 and a 9.3% increase from Q3 2023[89]. - Year-to-date net income for 2024 reached $10.6 million ($2.41 per diluted share), up 4.8% compared to the same period in 2023[89]. Expenses and Income - Total noninterest expense for the nine months ended September 2024 was $41,561 thousand, compared to$36,864 thousand in the same period of 2023, indicating an increase of 12.6%[7]. - Noninterest expense increased by $1.7 million to$13,917 thousand in Q3 2024, primarily due to higher salaries and benefits costs[103]. - The provision for credit losses on loans for September 2024 was $474 thousand, a decrease of 45.2$866 thousand in September 2023[7]. - The provision for credit losses was $485 thousand for Q3 2024, down from$875 thousand in Q3 2023[90]. - Noninterest income rose by $840 thousand to$4,853 thousand in Q3 2024, a 20.9% increase compared to Q3 2023, driven by higher wealth management fees and loan service charges[101]. Assets and Liabilities - Total assets as of September 30, 2024, increased to $1,200 million, reflecting a growth of 8.0$1,111 million as of December 31, 2023[7]. - The total cash and cash equivalents at the end of the period were $236,317,000, significantly higher than$73,953,000 at the end of September 2023, marking an increase of approximately 219.5%[11]. - The total outstanding loans increased to $1,348,386 thousand as of September 30, 2024, compared to$1,240,933 thousand at December 31, 2023, reflecting a growth of approximately 8.7%[34]. - Total deposits increased to $1,723,491 thousand from$1,537,978 thousand as of December 31, 2023, representing an increase of approximately 12.1%[73]. - The total interest-bearing liabilities rose to $1,640,311 thousand in Q3 2024, compared to$1,349,860 thousand in Q3 2023, marking an increase of 21.5%[99]. Shareholder Equity - Total shareholders' equity increased to $149,928,000 as of September 30, 2024, up from$132,136,000 at the beginning of the year, representing a growth of approximately 13.5%[9]. - Shareholders' equity increased by $17.8 million year-to-date to$149.9 million, with a book value of $33.93 per share[91]. - The Corporation's dividend payout ratio was 39.74$17,507 thousand as of September 30, 2024, compared to $16,052 thousand at December 31, 2023, showing an increase of 9.1$1,483 thousand in Q3 2024 from $1,936 thousand in Q3 2023, a reduction of 23.4$2,077 thousand, with 30-59 days past due at $781 thousand and 90 days or more at$351 thousand[45]. - The total nonaccrual loans as of September 30, 2024, include $43 thousand in residential real estate and$147 thousand in commercial loans[44]. Market and Economic Conditions - The Corporation's market area includes diverse industries such as warehousing, healthcare, and agriculture, providing a stable economic base for growth[136]. - The Bank's capital conservation buffer was 5.44% as of September 30, 2024, exceeding the regulatory minimum of 2.5%[75]. - The Corporation's liquidity management strategy includes regular reviews of projected net cash flows at 30 and 90-day intervals to ensure adequate funding resources[138]. Regulatory Compliance - Common Equity Tier 1 (CET1) Risk-based Capital Ratio for Franklin Financial Services Corporation was 12.08% as of September 30, 2024, up from 11.82% at December 31, 2023[76]. - Total risk-based capital ratio for Franklin Financial Services Corporation was 14.73% as of September 30, 2024, compared to 14.45% at December 31, 2023[76].