On August 6, 2024, CF Bankshares Inc (CFBK, Financial) released its 8-K filing detailing the financial results for the second quarter ended June 30, 2024. CF Bankshares Inc is engaged in providing a variety of financial services, including commercial loans, real estate loans, equipment leasing, SBA loans, and treasury management depository services.
Performance and Challenges
CF Bankshares Inc reported net income of $1.7 million, or $0.26 per diluted common share, for Q2 2024. This represents a significant decline from the $4.2 million, or $0.66 per diluted common share, reported in Q2 2023. The decrease in net income was primarily due to a $3.6 million increase in loan provision expenses, largely related to two acquired loan participations.
Timothy T. O’Dell, President and CEO, commented: “Net After Tax Consolidated Earnings for Q2 were $1.7 million (or $0.26 per diluted common share), which included the impact from $3.6 million in elevated loan provision expense. The increased provisioning was related mostly to two acquired loan participations whose performance we have been tracking closely.”
Financial Achievements
Despite the challenges, CF Bankshares Inc achieved a pre-provision, pre-tax net revenue (PPNR) of $5.5 million for Q2 2024, up from $5.0 million in Q1 2024 and $5.3 million in Q2 2023. This indicates a stable core operating performance.
Income Statement Highlights
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Net Interest Income | $11.4 million | $11.3 million | $11.5 million |
| Noninterest Income | $1.2 million | $905,000 | $978,000 |
| Noninterest Expense | $7.1 million | $7.2 million | $7.2 million |
| Net Income | $1.7 million | $3.1 million | $4.2 million |
Balance Sheet and Cash Flow Highlights
Net loans and leases totaled $1.7 billion at June 30, 2024, a slight decrease from $1.7 billion at March 31, 2024. Deposits also saw a decrease, totaling $1.7 billion at June 30, 2024, down from $1.7 billion at March 31, 2024. Stockholders’ equity increased to $159.6 million, up from $158.0 million at March 31, 2024.
Key Metrics
Net interest margin for Q2 2024 was 2.39%, a slight increase from 2.36% in Q1 2024 but a decrease from 2.52% in Q2 2023. The allowance for credit losses on loans and leases increased to $19.3 million, representing 1.13% of total loans and leases, up from 1.06% in Q1 2024.
Commentary and Analysis
Robert E. Hoeweler, Chairman of the Board, added: “Our underpinning business fundamentals remain very strong. We are buoyed by our continuing success attracting quality new business and banking talent, as our business model and delivery of commercial banking services resonates strongly with entrepreneurs and closely held businesses.”
CF Bankshares Inc's performance in Q2 2024 reflects both the challenges and opportunities in the current economic environment. The elevated loan provision expenses have impacted net income, but the company's core operations remain robust, as evidenced by stable PPNR and net interest income. The increase in noninterest income and the strategic focus on commercial loan generation and treasury management services are positive indicators for future growth.
For more detailed financial information, readers are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from CF Bankshares Inc for further details.
