CB Financial Services, Inc. (CBFV)·Q4 2024 Earnings Summary

Executive Summary

• Q4 delivered stable core performance: diluted EPS $0.46 and adjusted diluted EPS $0.35, with net interest and dividend income $11.5M and GAAP NIM 3.12% (up 1 bp vs Q3) as funding costs declined faster than asset yields; asset quality remained “pristine” with NPLs at 0.16% of loans .
• Revenue mix featured higher securities income (taxable securities income +166% YoY to $3.1M) and a $708k EU earn-out in other income; interest income included a $313k payoff of a previously nonaccrual loan, supporting NIM stability .
• Balance sheet repositioning and deposit mix shift continued: loans rose $26.9M QoQ driven by commercial portfolios; deposits declined $70.3M QoQ as $60.6M brokered CDs matured, reducing cash and cost of funds while insured/collateralized deposits reached 78.4% .
• Capital and liquidity remain strong: Tier 1 leverage 9.98%, CET1 14.78%, available borrowing capacity $601.6M and aggregate available liquidity $737.2M covering 369% of uninsured/non‑collateralized deposits; declared $0.25 dividend payable ~Feb 28, 2025 .

What Went Well and What Went Wrong

What Went Well

• NIM resilience amid lower deposit costs and reduced brokered CDs concentration: “Funding costs decreased at a more favorable rate than asset yields… we reduced our concentration of brokered time deposits” .
• Commercial-led loan growth: loans increased $26.5M QoQ with CRE, construction, and C&I leading gains; management highlighted expanded commercial team contributions .
• Asset quality remained strong: NPLs fell to 0.16% of loans, ACL/loans 0.90%, and annualized Q4 net charge-offs were 0.06% .

What Went Wrong

• Elevated interest expense on deposits: +40.4% YoY to $7.5M as mix shifted to higher-cost money market/time deposits and average cost of interest-bearing deposits rose 59 bps YoY .
• Efficiency ratio deteriorated vs prior quarters to 71.68% (from 69.11% in Q3) with higher salaries/benefits and contracted services; opex still above pre-sale EU levels adjusted for mix changes .
• Deposit base contracted QoQ by $70.3M as $60.6M brokered CDs matured, reducing cash balances; though intentional, the shrink reduced total deposits and required careful funding management .

Financial Results

Core P&L and EPS (Quarterly)

Notes: Q4 2024 interest income included a $313k payoff on a previously nonaccrual loan; Q4 noninterest income included a $708k EU earn‑out .

Margins and Profitability

Balance Sheet Snapshot

Asset Quality

Loan Portfolio Mix (12/31/24)

Deposit Mix (12/31/24)

Guidance Changes

Note: The company did not provide formal revenue, margin, OpEx, or tax rate guidance in Q4 materials .

Earnings Call Themes & Trends

Earnings call transcript was not available in the repository; themes are synthesized from Q2/Q3/Q4 press releases and the Q4 investor presentation [functions.ListDocuments earnings-call-transcript: none].

Management Commentary

• “We finished the year strong, with a consistent net interest margin along with solid fourth quarter loan growth. Funding costs decreased at a more favorable rate than asset yields… we reduced our concentration of brokered time deposits… helped lower our cost of funds.” — John H. Montgomery, President & CEO .
• “On a quarter over quarter basis, the loan portfolio grew $26.5 million… We have made tremendous efforts in expanding our commercial lending team over the last year, which is contributing to this growth.” — John H. Montgomery .
• “We are making forward progress in implementing our Specialty Treasury Payments & Services program… full utilization expected during the third quarter of 2025… anticipate this strategy contributing to revenue growth by the end of the year.” — John H. Montgomery .

Q&A Highlights

No Q4 2024 earnings call transcript was available in the repository; Q&A highlights and clarifications cannot be assessed [functions.ListDocuments earnings-call-transcript: none].

Estimates Context

Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue was unavailable due to an SPGI request limit error; as a result, we cannot classify beats/misses versus consensus at this time [functions.GetEstimates error].

Key Takeaways for Investors

• Margin stabilization is evident with GAAP NIM at 3.12% and FTE NIM at 3.13%, aided by lower funding costs, reduced brokered CDs, and a nonaccrual payoff; watch for further deposit cost relief as rate cuts flow through .
• Commercial growth is backstopping consumer runoff: loans +$26.9M QoQ with CRE/construction/C&I expansion; expanded commercial banker hiring pipeline supports momentum .
• Asset quality remains a differentiator: NPLs/loans at 0.16%, ACL/loans at 0.90%, and annualized NCOs at 0.06%; sustained conservative underwriting reduces tail risk .
• Liquidity and capital provide ample flexibility: $737.2M available liquidity, $601.6M borrowing capacity, deposit coverage at 369%, Tier 1 leverage 9.98%—capacity to fund growth and manage deposit churn .
• Specialty Treasury Payments & Services program is a 2025 catalyst: expected full utilization in Q3 2025 with deposit generation targeted by year-end, potentially improving core deposit mix and fee income .
• Opex mix bears watching: efficiency ratio at 71.68% and higher contracted services/data processing tied to tech initiatives; near-term cost investment should be weighed against expected TM revenue/low-cost deposit benefits .
• Dividend maintained at $0.25/share; combined with buyback authorization in 2024, capital returns remain part of the shareholder proposition .

Additional data points

• Taxable securities income +166% YoY to $3.1M on CLO purchases and higher yields (balance sheet repositioning) .
• Deposits -$70.3M QoQ largely from brokered maturities (−$60.6M), improving cost of funds and reducing excess cash .
• Insured/collateralized deposits represent 78.4% of total; uninsured at 21.6% .