Executive Summary

Q4 2024 posted a net loss of $1.764 million and EPS of -$0.14, driven by a negotiated settlement of a U.S. Government Contract Disputes Act claim that reduced net income by $3.8 million after tax in the quarter .
Core operating metrics held relatively stable q/q: Net interest margin (TEB) was 3.49% vs 3.47% in Q3; efficiency ratio worsened to 84.54% vs 76.73% due to provision and legal/valuation items .
Deposits rose $18.1 million in Q4 on seasonal factors and reduced pricing competition, with money market and CDs up; noninterest-bearing DDA remained 19.6% of total deposits, core deposits 80.7% .
The company maintained the quarterly dividend at $0.10 throughout 2024; book value/share increased to $12.55; Tier 1 leverage ratio was 10.90% at year-end .
Wall Street consensus estimates from S&P Global were unavailable at time of query due to API limits; results likely below EPS consensus given the Q4 loss and settlement impact [GetEstimates unavailable; values would be from S&P Global if available].

What Went Well and What Went Wrong

What Went Well

Deposit growth returned: total deposits increased $18.1 million in Q4 as pricing competition eased, and money market accounts (+$8.5 million) and CDs (+$12.6 million) grew .
NIM stability: Net interest margin (TEB) held at 3.49% in Q4 vs 3.47% in Q3, signaling stable asset yields and funding costs despite deposit competition .
Strategic focus and growth initiatives: management emphasized 2025 growth in small business and general commercial finance, and Treasury Services, citing new products and marketing that boosted originations of small business lines and new commercial deposit accounts in H2 2024. Quote: “We look forward to continuing our growth in small business and general commercial finance portfolios…” .

What Went Wrong

Q4 loss from dispute settlement: the company agreed to settle a $10.5 million claim for $5.6 million cash and return of unused licenses, causing a $3.8 million after-tax reduction to Q4 net income and a quarterly loss .
Credit costs spiked: provision for credit losses surged to $4.650 million in Q4 (vs $0.485 million in Q3), and net charge-offs were $4.974 million annualized, reflecting stress in equipment finance and commercial exposures .
Efficiency ratio deterioration: efficiency ratio worsened to 84.54% in Q4 from 76.73% in Q3, driven by higher provisioning and specific legal/valuation expenses tied to equipment finance and disputes .

Financial Results

Metric (Units)	Q4 2023	Q1 2024	Q2 2024	Q3 2024	Q4 2024
Net Income ($USD Thousands)	$2,079	$1,710	$2,134	$1,993	$(1,764)
Diluted EPS ($)	$0.17	$0.14	$0.17	$0.16	$(0.14)
Total Interest Income ($USD Thousands)	$16,923	$17,345	$17,655	$16,886	$16,687
Total Interest Expense ($USD Thousands)	$4,491	$4,818	$5,079	$5,225	$5,010
Net Interest Income ($USD Thousands)	$12,432	$12,527	$12,576	$11,661	$11,677
Provision for Credit Losses ($USD Thousands)	$313	$12	$(122)	$485	$4,650
Noninterest Income ($USD Thousands)	$1,625	$1,461	$1,276	$1,482	$1,570
Noninterest Expense ($USD Thousands)	$10,879	$11,766	$11,135	$10,084	$11,199
Net Interest Margin (TEB, %)	3.48%	3.59%	3.67%	3.47%	3.49%
Efficiency Ratio (%)	77.39%	84.11%	80.39%	76.73%	84.54%
ROA (%)	0.56%	0.46%	0.58%	0.56%	(0.49%)
ROE (%)	5.37%	4.38%	5.44%	5.03%	(4.43%)

Segment/Balance Mix

Loans by Category ($USD Thousands, Period End)	Q4 2023	Q3 2024	Q4 2024
One-to-Four Family Residential	$18,945	$15,634	$14,829
Multi-Family Residential	$527,460	$524,340	$521,957
Nonresidential Real Estate	$118,016	$109,799	$108,153
Commercial Loans & Leases	$393,321	$280,218	$248,595
Consumer	$1,364	$1,847	$1,623
Total Loans	$1,059,106	$931,838	$895,157
Allowance for Credit Losses	$(8,345)	$(7,899)	$(7,571)
Loans, Net	$1,050,761	$923,939	$887,586

Deposits by Type ($USD Thousands, Period End)	Q4 2023	Q3 2024	Q4 2024
Noninterest-Bearing Demand	$260,851	$226,882	$238,826
Interest-Bearing NOW	$306,548	$276,551	$277,059
Money Market	$297,074	$306,679	$305,538
Savings	$174,759	$160,815	$161,139
Retail Certificates of Deposit	$222,391	$228,485	$234,979
Total Deposits	$1,261,623	$1,199,412	$1,217,541

KPIs and Credit Quality

Credit Quality & Capital	Q4 2023	Q3 2024	Q4 2024
Nonperforming Assets ($USD Thousands)	$25,115	$24,297	$18,325
NPAs / Total Assets (%)	1.69%	1.71%	1.28%
NPLs / Total Loans (%)	2.11%	2.40%	1.89%
ACL / Total Loans (%)	0.79%	0.85%	0.85%
ACL / NPLs (%)	37.36%	35.37%	44.71%
Tier 1 Leverage Ratio (%)	10.54%	11.11%	10.90%
Book Value per Share ($)	$12.45	$12.77	$12.55

Notes:

Loan-to-deposit ratio was 72.9% at 12/31/2024 vs 83.3% at 12/31/2023 .
Cash and interest-bearing deposits were $93.5 million at 12/31/2024; total assets $1.435 billion .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Quarterly Dividend per Share ($)	2024	$0.10	$0.10 maintained	Maintained
Strategic Outlook (qualitative)	2025	N/A	Growth focus in small business and general commercial finance; expand small business and commercial deposit/Treasury Services; evaluate efficiencies in facilities/expenses	Initiated qualitative outlook
Capital Ratios	2024 YE	N/A	Tier 1 leverage 10.90%; CET1 18.70%; Total RBC 21.79%	Informational (no target)

No numeric revenue/EPS/expense guidance ranges were provided in the filings. Management’s commentary was directional rather than quantitative .

Earnings Call Themes & Trends

No earnings call transcript was found for Q4 2024 in the available document catalog; therefore, call themes and Q&A are unavailable for this quarter.

Topic	Previous Mentions (Q-2 and Q-3)	Current Period (Q4 2024)	Trend
Deposit Competition & Mix	Competition intensified in Q2–Q3 from regional banks, credit unions, and money market funds ; core deposits ~80%	Competition eased; deposits +$18.1mm; MM/CDs grew; DDA 19.6%; core deposits 80.7%	Improving pricing environment; stable core mix
Government Disputes & Legal	Two Contract Disputes Act claims submitted in 2024; legal expenses increased	Final settlement of largest claim; $3.8mm after-tax Q4 hit; one claim remains	Resolution progress; residual exposure remains
Credit Quality & Equipment Finance	Ongoing resolutions of middle-market and small-ticket equipment finance nonperformers during year	NPLs and NPAs declined q/q; net charge-offs elevated; equipment finance nonaccruals still sizable	Mixed: improved NPA ratios but higher charge-offs
Originations & Underwriting	Increased opportunities in Q2/Q4, but low conversion due to underwriting competition	Continued mention of low sales conversion in MF/CRE/middle-market equipment; small business lines and Treasury/Deposits originations rising	Shift toward small business/commercial/Treasury growth
Macro/Funding Costs	Deposit cost up 64 bps YoY (1.22%→1.86%); average cost of funds rose	Average cost of deposits 1.52% (Q4), NIM stable	Funding costs elevated vs 2023; stabilizing q/q

Management Commentary

“The Company ended 2024 in good financial and operational condition… The net income for 2024 reflects the financial impact of the two U.S. Government Contract Disputes Act claims and the final resolution of the most significant claim…” — F. Morgan Gasior, Chairman & CEO .
“We look forward to continuing our growth in small business and general commercial finance… [and] evaluate opportunities to achieve greater efficiencies in facilities utilization and other expense categories…” — F. Morgan Gasior .
“His extensive background and deep understanding of commercial finance perfectly align with our mission… to empower businesses with flexible, competitive financial solutions…” — on the appointment of a Regional Commercial Financial Leader (Jan 8, 2025 press release) .

Q&A Highlights

No Q4 2024 earnings call transcript was available; thus, Q&A themes, guidance clarifications, and tone assessment from the call are unavailable based on accessible source documents.

Estimates Context

S&P Global (Capital IQ) Wall Street consensus for Q4 2024 EPS and Revenue was unavailable due to API request-limitation errors at time of query. As a result, we cannot quantify beats/misses vs consensus for this quarter (if available, values would be retrieved from S&P Global).

Key Takeaways for Investors

The Q4 loss was event-driven, tied to the government dispute settlement; underlying NIM remained stable q/q at 3.49%, suggesting core spread dynamics are steady .
Deposit momentum improved in Q4 as pricing competition eased, with MM and CD balances rising and total deposits up $18.1 million; sustaining this trend will aid funding stability and margin preservation .
Credit quality ratios improved (NPAs/Assets fell to 1.28%), but elevated net charge-offs and a large equipment finance nonaccrual balance indicate continued portfolio clean-up and risk reduction efforts in equipment finance/healthcare finance .
Efficiency ratio deterioration (84.54%) and higher provision/legal/valuation costs pressured profitability; watch for 2025 efficiency initiatives in facilities and expenses to restore operating leverage .
Capital remains strong (Tier 1 leverage 10.90%), dividend was maintained at $0.10/share, and book value/share increased to $12.55—supportive of capital return stability despite Q4 volatility .
Strategic pivot toward small business/commercial lending and Treasury Services with new products and marketing could improve originations mix and fee income; execution and underwriting discipline remain critical amid competitive credit markets .
With consensus estimates unavailable, near-term stock reaction may hinge on investor interpretation of the non-recurring settlement vs. core operations stability; track subsequent disclosures on the remaining claim and any remarketing recovery of returned licenses .

BankFinancial CORP (BFIN)·Q4 2024 Earnings Summary