Five Bancorp Reports Robust Earnings Growth for Fiscal 2025

Five Bancorp US33830T1034

Five Bancorp concluded its 2025 fiscal year with a substantial surge in profitability, driven by a favorable interest rate environment and lower funding expenses. The financial institution's management has expressed confidence in maintaining this positive trajectory in the coming months.

• Net income for the year reached $61.6 million, a significant increase from the $45.7 million reported in the prior year.
• The net interest margin for the fourth quarter improved to 3.66%.
• An additional special cash dividend of $0.25 per share is scheduled for payment on Monday.

The final quarter of 2025 proved particularly strong, with Five Bancorp generating net earnings of $17.6 million. This result marks an improvement over both the preceding quarter's $16.3 million and the $13.3 million earned in the same period last year. On a per-share basis, fourth-quarter earnings came in at $0.83.

A key driver of the annual performance was a 23-basis-point expansion in the full-year net interest margin, which finished at 3.55%. This improvement was supported by a notable reduction in deposit costs, which fell by 16 basis points year-over-year to 2.40%. The downward trend in funding costs accelerated in Q4, dropping to 2.23%. Credit quality remained broadly stable despite the bank's growth, although the ratio of non-performing loans saw a slight increase from 0.05% to 0.08% over the year.

Strategic Priorities and Capital Return

Looking ahead, the bank's leadership has outlined ambitious targets for the current fiscal year, aiming for 10% growth in both loan originations and total deposits. As part of a strategy to optimize its balance sheet, Five Bancorp plans to reduce higher-cost wholesale deposits by approximately $175 million. The company's expense-to-assets ratio is targeted to fall within a range of 1.48% to 1.55% for 2026.

In a move to return capital to shareholders, the board has declared a special dividend of $0.25 per share. This payment, distributed to shareholders of record as of February 2nd, will be disbursed on Monday and reflects the direct sharing of the year's enhanced profits with investors. The bank's ability to sustain disciplined cost management while pursuing its loan growth objectives will be a critical factor in achieving its goals for the new year.