EXTON, Pa., Oct. 28, 2025 /PRNewswire/ -- First Resource Bancorp, Inc. (OTCQX: FRSB), the holding company for First Resource Bank, announced financial results for the three months ended September 30, 2025.

Lauren C. Ranalli, President and CEO, stated, "We achieved record net income during the third quarter of 2025, continuing the trend of exceptional performance established in the first half of the year. The net interest margin has steadily climbed this year, accelerating from 3.60% in the first quarter and 3.72% in the second quarter to 3.87% in the third quarter of 2025. We also surpassed the $700 million asset threshold, fueled by strong loan and deposit growth. These results reflect our unwavering commitment to providing exceptional customer service, fostering a thriving workplace culture, and supporting our local communities, all of which continue to generate exceptional value for our shareholders."

Highlights for the third quarter of 2025 included:

   -- Net income reached $2.3 million, a remarkable 39% increase year-over-year 
      and 19% growth over the prior quarter 
 
   -- Net interest margin expanded 15 basis points over the prior quarter to 
      3.87% 
 
   -- Total interest income rose 16% compared to the third quarter of 2024 
 
   -- Net interest income grew 27% over the prior year third quarter 
 
   -- Earnings per share climbed 42% to $0.75, compared to the same quarter 
      last year 
 
   -- Total loans grew 5% during the quarter, or 19% annualized 
 
   -- Total deposits also rose 5%, or 21% annualized 
 
   -- Book value per share increased 4% to $18.79 
 
   -- Total assets expanded by $27.6 million, or 4%, ending the quarter at 
      $724.9 million 
 
   -- There were no non-accrual or non-performing loans as of September 30, 
      2025 

"Our record year to date performance through September 30, 2025, positions us for what we anticipate being our most successful year yet," said Ranalli. "We're seeing sustained growth momentum and consistently strong profitability, which continue to strengthen our balance sheet. Disruption caused by an uptick in bank merger activity across our region will open the door to meaningful new business development opportunities and we are ready to seize them."

The company delivered outstanding financial performance in the third quarter of 2025, reporting net income totaling $2.3 million, or $0.75 per common share, a significant increase from $1.9 million, or $0.63 per share, in the previous quarter, and up considerably from $1.6 million, or $0.53 per common share, in the same period last year. This impressive growth was reflected in key profitability metrics, with the annualized return on average assets climbing to 1.29% for the third quarter of 2025, compared to 1.04% in the third quarter of 2024. Similarly, the annualized return on average equity also improved, reaching 16.19%, up from 13.08% year-over-year, underscoring the Bank's continued strength and strategic execution.

Total interest income for the third quarter of 2025 reached $11.0 million, reflecting a $720 thousand or 7% increase over the prior quarter. This growth was fueled by a 5% increase in loans during the third quarter, coupled with an overall increase in loan yields.

Total interest income increased by $1.5 million, marking a 16% increase from $9.5 million in the third quarter of 2024 to $11.0 million in the corresponding period of 2025. This growth was driven by a 12% year-over-year expansion in loans, complemented by an overall increase in loan yields.

Total interest income grew $4.1 million, or 15%, from $26.9 million for the nine months ended September 30, 2024, to $31.0 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 third quarter of 2025 compared to the prior quarter, primarily due to greater volumes of interest-bearing deposits. This was partially offset by an 11 basis point reduction in the cost of interest-bearing deposits. Consequently, interest expense on borrowings decreased by 9%, driven by a 34 basis point reduction in the cost of FHLB borrowings during the third quarter.

Total interest expense increased by 2%, climbing from $4.3 million in the third quarter of 2024 to $4.4 million in the third quarter of 2025. This increase was primarily attributable to greater volumes of interest-bearing deposits, partially offset by a 36 basis point decrease in the cost of interest-bearing deposits year-over-year. Interest expense on subordinated debt grew by 11%, while interest expense on borrowings declined by 68% when compared to the third quarter of 2024.

Total interest expense for the nine months ended September 30, 2025 increased by 7%, to $13.0 million, up from $12.1 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 14 basis point decrease in the cost of money market accounts, a 48 basis point drop in the cost of time deposits, and a 65 basis point decline in the cost of FHLB borrowings.

In the third quarter of 2025, net interest income grew by $608 thousand, or 10%, compared to the previous quarter. The net interest margin also improved, rising to 3.87% from 3.72% in the second quarter of 2025. The overall yield on interest-earning assets climbed by 7 basis points, primarily driven by a 9 basis point increase in loan yields to 6.64% for the quarter. Meanwhile, the cost of interest-bearing deposits declined 11 basis points to 3.25%, primarily due to a 19 basis point drop in the cost of time deposit accounts. This decrease was partially offset by higher volumes of interest-bearing deposit accounts. As a result, the total cost of deposits fell by 8 basis points for the quarter, from 2.82% to 2.74%.

Net interest income for the nine months ended September 30, 2025, totaled $18.0 million, reflecting a 22% improvement from $14.8 million for the same period in 2024. This growth was fueled by a $4.0 million, or 15%, increase in loan interest income, a $284 thousand, or 54%, decline in interest expense on borrowings, and a $122 thousand, or 133%, increase in other interest income, partially offset by a $1.1 million, or 10%, increase in deposit interest expense and a $97 thousand, or 32%, increase in interest expense on subordinated debt.

The provision for credit losses in the third quarter of 2025 was $189 thousand, up from $130 thousand in the prior quarter. A $215 thousand charge-off for a non-accrual commercial loan relationship was recorded in the third quarter of 2025, bringing total non-accrual loans to zero. Year over year, the provision for credit losses increased $176 thousand from $13 thousand in the third quarter of 2024 to $189 thousand in the third quarter of 2025.

As of September 30, 2025, the allowance for credit losses to total loans stood at 0.72%, down from 0.93% as of December 31, 2024. The reserve decreased due to a first-quarter charge-off of a previously reserved credit. There were no non-performing assets as of September 30, 2025, after the prior quarter end's total of a $215 thousand non-accrual commercial loan relationship was charged off. Non-performing assets to total assets stood at 0.00% as of September 30, 2025, compared to 0.19% as of December 31, 2024, and 0.00% at September 30, 2024.

Non-interest income totaled $349 thousand in the third quarter of 2025, representing a 6% decrease from $372 thousand in the previous quarter, and a 22% increase from $286 thousand in the same period of 2024. Notably, swap referral fee income contributed $97 thousand in the third quarter of 2025, down from $108 thousand in the second quarter of 2025 and up from zero in the third quarter of 2024. No gains on the sale of SBA loans were recorded in the third quarter of 2025, compared to $26 thousand in the previous quarter, and $59 thousand in the third quarter of 2024.

Non-interest income for the nine months ended September 30, 2025, totaled $1.1 million, up from $973 thousand in the same period of 2024. Swap referral fee income was $229 thousand in the first nine months of 2025, compared to $245 thousand in the first nine months of 2024. Gains on the sale of SBA loans totaled $113 thousand in the first nine months of 2025, compared to $59 thousand in the prior year period.

Non-interest expenses increased $80 thousand, or 2%, in the third quarter of 2025 compared to the prior quarter. This increase was driven by higher salaries & benefits, data processing, and other costs, partially offset by decreases in occupancy & equipment, professional fees, and advertising.

Non-interest expenses increased $486 thousand, or 14%, in the third 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 2.21% in the third quarter of 2025, down from 2.29% in the previous quarter and up from 2.17% in the third quarter of the prior year.

Non-interest expenses for the nine months ended September 30, 2025, were $11.3 million compared to $10.0 million for the same period in the prior year. The increase of $1.2 million, or 12%, was mostly attributed to increases in salaries & benefits associated with an expanded workforce, along with professional fees, advertising, data processing, and other expenses.

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October 28, 2025 08:00 ET (12:00 GMT)