Executive Summary

Q3 2024 was a clean rebound quarter: diluted EPS rose to $0.65 from $0.26 in Q2 and $0.62 a year ago as provision expense normalized, noninterest-bearing deposits surged 18% QoQ, and NIM expanded for a second straight quarter to 2.41% .
Net interest income was stable at $11.5mm (+0.8% QoQ), while noninterest income increased 32% QoQ to $1.6mm, driven by higher swap fees and “other” income; service charges were up 65% YoY .
Credit remained the key watch item: nonaccruals rose to 0.84% of loans (two commercial credits moved to nonaccrual), and net charge-offs were $3.29mm, though provision fell sharply to $0.56mm from $3.56mm in Q2 (Q2 reflected reserves on two non-core loan participations) .
The Board raised the quarterly dividend 17% to $0.07 on Oct 1; management highlighted deposit repricing tailwinds from recent Fed cuts and a balance sheet shift away from residential mortgages toward commercial relationships as ongoing catalysts .

What Went Well and What Went Wrong

What Went Well
- EPS recovery with PPNR resilience: $0.65 EPS and $5.84mm PPNR as provision normalized after Q2’s elevated reserves; NIM ticked up 2 bps QoQ to 2.41% (second consecutive expansion) .
- Deposit mix improvement: noninterest-bearing deposits grew $40mm (18%) QoQ; total deposits +$49.1mm QoQ; brokered deposits reduced by $14.7mm YTD .
- Management tone constructive: “recent Fed rate cuts are providing for deposit repricing opportunities,” and strategic pivot to reduce residential mortgage portfolio and fund commercial pipelines to support NIM over time .
What Went Wrong
- Asset quality pressure: nonaccrual loans rose to $14.6mm (0.84% of loans) from $10.9mm in Q2, and net charge-offs increased to $3.29mm; ACL/loans declined to 0.97% (from 1.13% in Q2) as prior-quarter specific reserves were charged off .
- Operating costs edged up: noninterest expense increased 1.9% QoQ (and 6.9% YoY) on higher “other” and data processing costs; fraud losses contributed to “other” expense YoY .
- No formal quantitative guidance; while management cited positive deposit repricing and commercial pipelines, investors lack explicit targets on NIM, credit costs, or growth .

Financial Results

Metric	Q3 2023	Q2 2024	Q3 2024
Diluted EPS ($)	0.62	0.26	0.65
Net Interest Income ($mm)	11.667	11.367	11.460
Noninterest Income ($mm)	1.301	1.218	1.606
Provision for Credit Losses ($mm)	1.193	3.561	0.558
Net Interest Margin (%)	2.50%	2.39%	2.41%
ROA (annualized, %)	0.82%	0.34%	0.84%
ROE (annualized, %)	10.75%	4.23%	10.38%
Efficiency Ratio (%)	52.13%	56.35%	55.30%

Balance sheet and credit KPIs

KPI	Dec 31, 2023	Jun 30, 2024	Sep 30, 2024
Total Deposits ($mm)	1,744.057	1,696.476	1,745.576
Noninterest-Bearing Deposits ($mm)	235.916	217.771	257.715
Loans & Leases, Gross ($mm)	1,710.998	1,706.980	1,733.855
Nonperforming Loans / Total Loans (%)	0.33%	0.64%	0.84%
ACL on Loans / Total Loans (%)	0.99%	1.13%	0.97%
Net Charge-offs ($mm)	0.623 (Q4’23)	2.108	3.291
% Deposits > FDIC Limit	29.2%	28.6%	30.2%

Notes: Management also highlighted YTD service charge growth (+70% YoY) and QoQ swap fee increases; see Noninterest Income detail above .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Dividend per common share	Quarterly	$0.06 (paid Jul 19, 2024)	$0.07 (payable Oct 19, 2024)	Raised
Formal quantitative financial guidance (NIM, credit costs, revenue/expense)	FY/Quarter	None disclosed	None disclosed; qualitative commentary on deposit repricing and balance sheet repositioning	Maintained (no formal guidance)

Earnings Call Themes & Trends

No earnings call transcript was available in the source set for Q3 2024; themes are compiled from management’s press releases.

Topic	Previous Mentions (Q2 and Q1)	Current Period (Q3 2024)	Trend
Deposit mix and pricing	Q1: “held the line” against ultra-high competitor rates to manage cost of funds ; Q2: deposits declined QoQ, but service charges benefited from treasury management buildout	Noninterest-bearing deposits +18% QoQ; management sees deposit repricing tailwinds from recent Fed cuts	Improving mix; pricing tailwind
NIM trajectory	Q1 NIM 2.36% (down, calendar/fee headwinds) ; Q2 NIM +3 bps to 2.39%	NIM +2 bps QoQ to 2.41% (second consecutive expansion)	Slightly improving
Credit and non-core participations	Q1: core book strong ; Q2: $3.6mm provision on two non-core participations acquired from regionals	Provision normalized to $0.56mm, but nonaccruals rose to 0.84% and NCOs were $3.29mm as prior reserves flowed through	Mixed; normalization in provision, elevated losses
Commercial growth & pipelines	Q1: $37.3mm new production, teams expanded ; Q2: pipelines “increasing,” new Indianapolis team	“Pipelines… continue to expand”; balance sheet pivot to commercial loans with deposit/treasury relationships	Positive pipeline momentum
Fee income (Treasury Mgmt)	Q2: service charges +64% YoY; TM leadership cited	Service charges +65% YoY; YTD +70%	Sustained growth

Management Commentary

“Recent Fed rate cuts are providing for deposit repricing opportunities which will lower deposit interest expense and are expected to reduce our incremental cost of funding over time.” – Timothy T. O’Dell, President & CEO .
“Strategically, our business intents include repositioning our balance sheet, by reducing the portfolio of residential home mortgage loans… to fund commercial banking pipelines… This approach will result in a long-term benefit to our net interest margin.” – Timothy T. O’Dell .
“Our CF Leadership Team has continued to successfully adapt to the challenging interest rate environment… executing solid fundamentals.” – Robert E. Hoeweler, Chairman .

Q&A Highlights

No Q3 2024 earnings call/Q&A transcript was available in the documents set; no additional Q&A disclosures were found in 8-Ks or press releases [List: earnings-call-transcript returned none].

Estimates Context

We attempted to retrieve S&P Global consensus for Q3 2024 EPS and revenue; consensus data was unavailable at query time due to SPGI daily request limits. As a result, we cannot assess beats/misses versus Wall Street for this quarter [GetEstimates error].
Actual reported EPS and key line items are presented above; where estimates become available, EPS and “total net revenue” (NII + noninterest income) should be compared to consensus to gauge revisions risk .

Key Takeaways for Investors

Momentum in core earnings: EPS recovered to $0.65 as provision normalized and NIM expanded again; watch for further NIM benefit from deposit repricing and balance sheet mix shift toward commercial .
Deposit franchise traction: +$40mm noninterest-bearing QoQ and +$49mm total deposits QoQ, reducing reliance on higher-cost funding and potentially supporting NIM into 2025 .
Credit watch remains the swing factor: rising nonaccruals (0.84%) and elevated NCOs ($3.29mm) suggest near-term volatility in credit costs even as Q2’s non-core specific reserves roll through .
Expense discipline needed: efficiency ratio at 55.3% (vs 52.1% in 3Q23) with higher “other” costs; continued scaling of fee income (service charges +65% YoY) can help offset .
Capital and dividends supportive: CET1/Tier 1 risk-based ~12.35% and dividend raised 17% to $0.07 underline confidence; dividend growth can be a stock support if credit stabilizes .
Trading setup: absent consensus estimates, near-term stock reaction likely tied to narrative—deposit mix improvement, NIM stabilization, and any incremental disclosures on non-core credit resolution and charge-off cadence in Q4 .

Appendix: Prior-Quarter Context (for trend analysis)

Q2 2024: EPS $0.26; provision $3.56mm (reserves on two non-core participations); NIM 2.39%; service charges +64% YoY .
Q1 2024: EPS $0.47; provision $1.24mm; NIM 2.36%; management “held the line” on deposit pricing; new commercial hires noted .

Sources: CFBK Q3 2024 8‑K and Exhibit 99.1 earnings release (Oct 30, 2024) ; Standalone Q3 2024 press release (Oct 30, 2024) ; Dividend press release (Oct 1, 2024) ; Q2 2024 8‑K/PR (Aug 6, 2024) ; Q1 2024 8‑K/PR (May 7, 2024) .

Estimates: S&P Global consensus unavailable at time of query due to API limit (attempted “Primary EPS Consensus Mean” and “Revenue Consensus Mean” for Q3 2024).

CF BANKSHARES INC. (CFBK)·Q3 2024 Earnings Summary