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Catalyst Bancorp, Inc. (CLST)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 was steady but mixed: net income was $586k (diluted EPS $0.16), essentially flat QoQ ($626k, $0.16) and up markedly YoY from a loss in Q1 2024, with NIM easing 3 bps QoQ to 3.89% as asset yields slipped and deposit costs edged up modestly .
  • Loan growth was “muted” as “market turbulence caused some of our customers to delay projects,” while deposits fell $5.1m (−3%) sequentially, largely tied to public funds seasonality; loan-to-deposit ratio rose to 92% (from 90% in Q4) .
  • Non-interest income rose sharply QoQ on $216k of insurance proceeds related to foreclosed properties; non-interest expense increased on higher foreclosed asset losses and marketing spend; BTFP paydown in Q4 reduced borrowing costs into Q1 .
  • Capital remains very strong (prelim. CET1 46.95%, Total RBC 48.20% at the bank), and the company repurchased 72,949 shares at $11.86 avg. in Q1; 114,201 shares remained under the Nov-2024 plan at quarter-end .
  • No formal guidance or Street consensus was available; near-term stock catalysts include continued capital returns, stabilization of public fund deposits/mix, and NIM trajectory following the BTFP payoff and deposit pricing actions .

What Went Well and What Went Wrong

What Went Well

  • Non-interest income support from one-time items: Q1 included $216k of insurance proceeds tied to foreclosed assets, helping lift total non-interest income to $553k (+64% QoQ) .
  • Funding cost relief from BTFP payoff: Borrowings interest expense fell by $112k vs. Q4 as the $20m BTFP advance was retired in Q4, partially offsetting higher deposit costs, supporting a NIM of 3.89% (−3 bps QoQ) .
  • Strong capital and capital return: Bank-level CET1 46.95% and Total RBC 48.20%; continued buybacks of 72,949 shares in Q1 (avg. $11.86), with ~114k shares remaining under the plan .
  • Management tone emphasizes values and culture amid turbulence: “Loan growth was muted…market turbulence caused some of our customers to delay projects,” but the bank received “Best Community Banks to Work For” recognition at ICBA Live .

What Went Wrong

  • Loan growth stalled: Loans declined $1.0m QoQ to $166.1m, led by C&I (−$1.0m) and construction & land (−$0.9m) .
  • Deposit balance pressure and mix: Deposits fell $5.1m QoQ to $180.6m, with public funds down to $29.8m (17% of deposits vs. 19% in Q4), lifting the loan-to-deposit ratio to 92% .
  • Core margin drift: NIM fell 3 bps QoQ as asset yields slipped 3 bps to 5.54% and interest-bearing deposit costs rose to 2.54% (+14 bps vs. Q3 2024) amid public funds cost dynamics; net interest income fell $107k QoQ .
  • Elevated non-interest expenses: Non-interest expense rose $160k QoQ to $2.2m, including $88k net losses on sales of foreclosed properties and higher marketing and collection-related costs .

Financial Results

Metric ($USD Thousands unless noted)Q1 2024Q3 2024Q4 2024Q1 2025
Net Interest Income2,093 2,532 2,472 2,365
Non-Interest Income(5,163) 620 337 553
Revenue (Net Int. + Non-Int.)(3,165)*3,152*2,809*2,918*
Net Income (Loss)(4,689) 447 626 586
Diluted EPS ($)(1.15) 0.11 0.16 0.16
Net Interest Margin (TE, %)3.12 3.86 3.92 3.89
Efficiency Ratio (%)90.93 71.72 72.54 75.31
ROA (%)(6.58) 0.63 0.91 0.89
  • Revenue values with asterisk are from S&P Global and may differ from GAAP presentation; Values retrieved from S&P Global.

KPIs and balance sheet

KPIQ1 2024Q3 2024Q4 2024Q1 2025
Loans ($)143,491 165,882 167,076 166,077
Deposits ($)169,637 167,436 185,674 180,598
Loan-to-Deposit Ratio (%)—99 90 92
NPAs/Assets (%)0.61 0.57 0.66 0.63
NPLs/Loans (%)1.03 0.87 0.98 0.99
ACL on Loans ($)2,068 2,414 2,522 2,500
CET1 (Bank, %)—45.74 45.81 46.95
Total RBC (Bank, %)—46.99 47.07 48.20
Shares Repurchased (Period)—79,400 120,977 72,949

Estimates vs. Actuals (S&P Global baseline)

MetricQ1 2025 ConsensusQ1 2025 Actual
Revenue ($USD)N/A*2,918,000*
EPS ($)N/A*0.16
  • Consensus unavailable for CLST; Values marked with asterisk are retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
———The company did not issue quantitative guidance in the Q1 2025 press release/8-K—

Earnings Call Themes & Trends

Note: No earnings call transcript was published for Q1 2025; analysis below reflects management narrative across press releases/8-Ks.

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q1 2025)Trend
Loan growth cadenceRecord quarterly loan growth in Q3 (+$12.6m) and continued growth in Q4 (+$1.2m) “Loan growth was muted… market turbulence delayed projects,” loans −$1.0m QoQ Decelerated
Public funds/deposit seasonalityDeposits −$12.6m in Q3 on seasonal public funds; +$18.2m in Q4 on seasonal inflows Deposits −$5.1m; public funds $29.8m (17% of deposits) vs. $35.6m (19%) in Q4 Continued volatility
Funding costs/BTFPBTFP outstanding/pledged securities in Q3; BTFP repaid in Q4 Borrowing cost down $112k QoQ from BTFP payoff; deposit costs partly offset Improved borrowings cost; deposit pricing pressure
MarginNIM: 3.86% (Q3) → 3.92% (Q4) NIM 3.89% (−3 bps QoQ) Stable to slight compression
One-time income itemsQ3: $280k CDFI BEA grant recognized Q1: $216k insurance proceeds in non-interest income Volatile, non-recurring blend
CreditNPLs/Loans: 0.87% (Q3) → 0.98% (Q4) 0.99% in Q1; NPAs/Assets 0.63% Slightly higher but stable

Management Commentary

  • “Loan growth was muted to start the year as market turbulence caused some of our customers to delay projects.” — Joe Zanco, President & CEO .
  • “We were grateful to have received the ‘Best Community Banks to Work For’ Award… Our employees continue to do a great job living our values of Truth, Humility, Impact, Now and Connection.” — Joe Zanco .
  • “The net interest margin for the first quarter of 2025 was 3.89%, down three basis points compared to the prior quarter… average yield on interest-earning assets was 5.54%… average rate paid on interest-bearing liabilities was 2.56%.” .
  • “Non-interest income… totaled $553,000… included insurance proceeds of $216,000 for fire and flood damages related to foreclosed properties.” .
  • “Non-interest expense… totaled $2.2 million… [included] net losses of $88,000 on the sale of foreclosed properties… [and] increase in the cost of employee benefits for 2025.” .

Q&A Highlights

  • No earnings call transcript was available for Q1 2025; Q&A highlights and any guidance clarifications were not published .

Estimates Context

  • S&P Global consensus for CLST was not available for Q1 2025 EPS or revenue; we therefore cite only actuals and denote consensus as N/A. Revenue “actual” values shown are S&P Global’s aggregation for comparability, which may differ from GAAP presentation; Values retrieved from S&P Global.
  • Given muted loan growth, slight NIM compression, and deposit mix dynamics, near-term estimate revisions (where coverage exists) would likely focus on NIM trajectory and non-interest income normalization (removal of one-time insurance proceeds) .

Key Takeaways for Investors

  • Core earnings steady but reliant on non-recurring items: Q1 EPS $0.16 with non-interest income boosted by $216k insurance proceeds; absent one-offs, operating leverage remains tight as NIM ticked down and expenses rose .
  • Funding mix/seasonality remains the swing factor: Public funds drove deposit volatility Q3→Q4→Q1 and influenced deposit costs; stabilization here is key for NIM and liquidity optics (loan/deposit now 92%) .
  • Margin path post-BTFP payoff: Borrowing cost relief is realized; the next lever is deposit pricing/mix to defend NIM amid modest asset yield drift (5.54% in Q1) .
  • Credit steady but watch retail residential: NPLs/Loans at 0.99%, with 98% of NPLs in one- to four-family mortgages; charge-offs of $39k in Q1 were low .
  • Capital return continues: Repurchases (72,949 shares in Q1; ~114k shares left under the plan at 3/31) plus very strong bank-level capital ratios provide downside support and optionality .
  • Near-term setup: Expect normalization of non-interest income (no BEA grant, insurance proceeds were one-time), careful monitoring of public fund seasonality into mid-year, and focus on expense control as business development/marketing ramps .

Appendix: Additional Detail (select disclosures)

  • Deposit composition: Non-interest-bearing $26.1m; interest-bearing demand $42.7m; money market $9.7m; savings $42.5m; CDs $59.5m at 3/31/25 .
  • Loan composition highlights: C&I −$992k QoQ (oilfield −$6.3m offset by industrial equipment +$5.45m); construction & land −$903k, with multi-family +$1.27m and “other commercial construction and land” −$2.57m .
  • Share count: 4,205,201 common shares outstanding at 3/31/25 .

Citations
(Q1 2025 press release and tables)
(8-K with Exhibit 99.1 content)
(Q4 2024 press release and tables)
(Q3 2024 press release and tables)
Investor Relations site reference for news/transcripts availability:

S&P Global disclaimer: Revenue values marked with an asterisk (*) and consensus notations are Values retrieved from S&P Global.