Executive Summary

Record quarter: Net income rose to $4.48M and diluted EPS to $1.34, up 54% YoY, driven by net interest margin expansion and lower interest expense; management labeled the quarter “record quarterly earnings.”
Profitability inflected on both YoY and sequential bases: tax-equivalent NIM expanded to 3.71% (vs 3.19% in Q3’24 and 3.59% in Q2’25), ROA reached 1.45% and ROE 14.29%.
Credit quality and provisioning improved: provision fell to $0.15M (vs $0.46M YoY), net charge-offs were $17K; nonaccrual loans declined to $3.87M and ACL coverage edged up to 1.51% of loans.
Capital return: quarterly dividend of $0.31 was paid and the board added flexibility via a Rule 10b5-1/10b-18 repurchase plan for up to 113,236 shares (through Aug 28, 2026), signaling confidence in intrinsic value.
No sell-side consensus available for EPS or revenue this quarter; the beat/miss framework is not applicable for FCAP this period (S&P Global consensus data unavailable).

What Went Well and What Went Wrong

What Went Well

NIM-driven earnings power: Tax-equivalent NIM rose to 3.71% (from 3.19% YoY) as asset yields increased and average cost of interest-bearing liabilities fell to 1.66%; net interest income rose to $10.96M.
Noninterest income tailwind: $150K gain on equity securities (vs a $196K loss YoY) and stronger mortgage gains boosted noninterest income to $2.31M.
Credit benign and provisioning lower: Provision dropped to $0.15M (from $0.46M YoY), and net charge-offs were $17K for the quarter; nonaccrual loans improved to $3.87M at 9/30.

Quote: “We are excited to introduce additional flexibility into our existing stock repurchase plan… reflecting our confidence in the Company’s value.” — CEO Michael C. Frederick on the new Rule 10b5-1/10b-18 repurchase plan.

What Went Wrong

Operating expense pressure: Noninterest expense increased $0.54M YoY, primarily from occupancy/equipment (+$331K) due to demolition/rebuild of a Bullitt County branch and a loss on related assets, plus comp/benefits (+$202K).
Higher tax rate: Effective tax rate rose to 19.2% (vs 15.6% YoY), modestly diluting after-tax earnings leverage.
Securities-related drag (partial offset): Despite gains on equity securities, the company recorded a $39K net loss on sale of AFS securities in Q3’25 (no sales in Q3’24).

Financial Results

Income statement snapshot (oldest → newest)

Metric (Units)	Q1 2025	Q2 2025	Q3 2025
Net Income ($M)	$3.24	$3.78	$4.48
Diluted EPS ($)	$0.97	$1.13	$1.34
Net Interest Income ($M)	$9.58	$10.41	$10.96
Noninterest Income ($M)	$1.85	$2.02	$2.31
“Total Revenue” (NII+Noninterest) ($M)	$11.43 (= $9.58 + $1.85)	$12.43 (= $10.41 + $2.02)	$13.26 (= $10.96 + $2.31)
Provision for Credit Losses ($M)	$0.34	$0.31	$0.15
Effective Tax Rate (%)	17.2%	18.4%	19.2%

Notes: FCAP does not disclose “revenue” under a standard bank format; “Total Revenue” here is NII plus noninterest income derived from reported line items.

Margins and returns (oldest → newest)

Metric (Units)	Q1 2025	Q2 2025	Q3 2025
Net Interest Margin (GAAP, %)	3.28%	3.52%	3.64%
Net Interest Margin (Tax-Equivalent, %)	3.34%	3.59%	3.71%
Interest Rate Spread (GAAP, %)	2.85%	3.11%	3.21%
ROA (annualized, %)	1.08%	1.24%	1.45%
ROE (annualized, %)	11.12%	12.59%	14.29%
Net Overhead / Avg Assets (annualized, %)	2.40%	2.47%	2.44%

Balance sheet and credit (period-end; oldest → newest)

Metric (Units)	Q1 2025 (3/31)	Q2 2025 (6/30)	Q3 2025 (9/30)
Total Assets ($M)	$1,214.54	$1,242.69	$1,235.48
Gross Loans ($M)	$652.48	$658.90	$652.19
Deposits ($M)	$1,083.92	$1,110.63	$1,094.73
Nonaccrual Loans ($M)	$4.08	$3.99	$3.87
ACL as % of Gross Loans (%)	1.46%	1.48%	1.51%
Community Bank Leverage Ratio (%)	10.61%	10.80%	10.82%

YoY checkpoint (Q3 2024 vs Q3 2025)

Metric (Units)	Q3 2024	Q3 2025
Net Income ($M)	$2.90	$4.48
Diluted EPS ($)	$0.87	$1.34
Net Interest Margin (TE, %)	3.19%	3.71%
Provision for Credit Losses ($M)	$0.46	$0.15

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Formal Revenue/EPS/Margin Guidance	FY/Quarter	None provided	None provided	Maintained (no formal guidance)
Quarterly Dividend per Share	Q3 2025	$0.29 in Q2’25	$0.31	Increased
Share Repurchase Authorization (Plan)	9/4/2025–8/28/2026	Ongoing authorization since 2008	New Rule 10b5-1/10b-18 plan up to 113,236 shares	Added execution flexibility

No explicit OpEx, OI&E, or tax rate guidance was provided in the materials reviewed.

Earnings Call Themes & Trends

No earnings call transcript was available for Q3 2025; themes below reflect management’s disclosures in the quarterly releases.

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q3 2025)	Trend
Net Interest Margin	NIM expanded to 3.59% TE (Q2) on higher asset yields and stable funding costs; Q1 TE NIM 3.34%.	NIM rose to 3.71% TE; avg earning asset yield 4.94%, cost of IB liabilities 1.66%.	Improving
Deposit/Funding Costs	Avg cost of IB liabilities fell to 1.64% (Q2) vs 1.71% (Q2’24); BTFP balances reduced by Q2.	Cost further at 1.66%; no FHLB/BTFP balances in Q3 averages.	Stable to improving
Credit Quality	Q2 provision $0.31M; net charge-offs $0.11M; Q1 provision $0.34M; ACL coverage ~1.46%.	Provision $0.15M; net charge-offs $0.02M; nonaccruals down to $3.87M; ACL 1.51%.	Improving
Noninterest Income	Q2: slight YoY decline; securities loss and lower loan-sale gains offset by BOLI redemption gain.	Q3: +$0.51M YoY on equity gains (+$150K) and higher mortgage gains/swap fees; small AFS loss.	Improving
Expenses/Branch Investments	Q2: higher comp/benefits and occupancy from call center upgrade, ATM servicing, marketing.	Q3: higher occupancy from demolition/rebuild of Bullitt County branch; comp/benefits up.	Mixed (investment-driven)
Capital Return	Regular dividend ($0.29) in Q1–Q2.	Dividend to $0.31; new repurchase plan providing execution flexibility.	More shareholder-friendly

Management Commentary

Strategy and capital allocation: “We are excited to introduce additional flexibility into our existing stock repurchase plan… aligning it more closely with our long-term capital allocation strategy and reflecting our confidence in the Company’s value.” — Michael C. Frederick, President & CEO.
Net interest dynamics: Management cites higher tax-equivalent yields on earning assets (4.94%) and lower average cost of interest-bearing liabilities (1.66%) as key drivers of NIM expansion.
Operating investments: Elevated occupancy and equipment expense reflect demolition and rebuilding of a Bullitt County branch; Q2 included call center upgrades and higher ATM servicing expense.

Q&A Highlights

No earnings call transcript was available for Q3 2025; no Q&A details or clarifications were disclosed in the source documents reviewed.

Estimates Context

S&P Global sell-side consensus for EPS and revenue was unavailable for Q3 2025 (and for Q1–Q2 2025), so we cannot determine beat/miss versus Street. Values retrieved from S&P Global.
Given the strong YoY and sequential EPS acceleration and NIM expansion, any active coverage (if present) may update FY models to reflect lower funding costs and higher asset yields; however, absent published consensus, we do not quantify revisions.

Key Takeaways for Investors

Earnings power inflected as NIM expanded to 3.71% TE and funding costs stayed contained, lifting EPS to $1.34 and ROE to 14.3%. Sequential momentum continues.
Credit remained benign with a modest $0.15M provision and lower nonaccruals, supporting lower earnings volatility into year-end.
Expense uptick is investment-led (branch rebuild), likely transitory; watch for normalization as projects complete.
Capital return is stepping up: dividend increased to $0.31 and a 10b5-1/10b-18 plan enables opportunistic buybacks through Aug 2026.
Balance sheet capacity intact: deposits stable ($1.095B), CBLR 10.82%, positioning for continued organic growth.
With no Street consensus, stock reactions may hinge more on local/regional bank comps, NIM trajectories, and credit headlines than on “beat/miss” optics.
Monitor: forward NIM as deposit betas evolve, mortgage banking momentum, timing of branch rebuild completion, and tax rate creeping higher (19.2% this quarter).

Citations and sources:

Q3 2025 earnings 8-K and attached Exhibit 99.1 press release:
Q3 2025 earnings press release (GlobeNewswire):
Q2 2025 earnings 8-K and press release:
Q1 2025 earnings 8-K and press release:
Repurchase plan press release (Aug 29, 2025):

FIRST CAPITAL INC (FCAP)·Q3 2025 Earnings Summary