Peoples Financial Corporation has reported a notable decrease in its first quarter earnings for 2025, with net income falling by $1,105,000 to $1,310,000 from $2,415,000 in the same period in 2024. This decline translates to a drop in earnings per weighted average common share from $0.52 to $0.28, underscoring the financial pressures faced by the corporation in a challenging economic climate.
The reduction in earnings was primarily driven by a $1,025,000 decrease in net interest income, with total interest income declining by $1,370,000 to $7,559,000. This downturn was largely due to lower interest income on securities, a consequence of decreased balances and yields. However, the bank successfully mitigated some of these losses by reducing total interest expenses by $345,000, achieved through lower interest rates on deposit accounts and reduced borrowing costs.
Financial performance metrics for the quarter further illustrate the impact of the economic environment, with the return on average assets decreasing from 1.12% to 0.62% and the efficiency ratio increasing from 64% to 77%. Despite these challenges, shareholders' equity demonstrated resilience, increasing by $4,454,000 to $94,455,000 by the end of March 2025. This improvement was supported by quarterly earnings and a $3,144,000 decrease in unrealized losses on securities compared to the previous period.
The bank's strong leverage ratio of 13.32% and an increase in total deposits to $751,991,000, up by $31,261,000 from the end of 2024, highlight its solid financial foundation. This growth was largely fueled by public fund tax deposits received during the first and last quarters. Chevis C. Swetman, chairman and chief executive officer, reiterated the bank's focus on maintaining high-quality assets and staying alert to economic conditions and potential interest rate changes.
Operating 18 bank facilities across the Mississippi Gulf Coast, serving Hancock, Harrison, Jackson, and Stone counties, Peoples Financial Corporation remains a key player in the region's financial sector, with total assets amounting to $867 million as of March 31, 2025. For more information, visit https://www.peoplesfinancialcorporation.com.
