Executive Summary

Q4 2024 diluted EPS was $0.92 on net income of $7.4M, down versus Q3 ($1.29, $10.3M) and prior-year Q4 ($1.23, $9.8M), with the decline driven primarily by a tax provision of $2.5M versus a $0.4M tax benefit in Q3 tied to purchased energy tax credits .
Net interest margin remained resilient at 4.31% (vs. 4.35% in Q3 and 4.24% YoY), while efficiency ratio rose to 68.16% (vs. 69.42% in Q3 and 62.47% YoY), reflecting higher operating costs alongside stable core earnings capacity .
Deposits fell 3.6% QoQ as brokered CDs declined $107.2M, offset by increased FHLB borrowings (+$144.0M) due to more favorable rates; the Board raised the quarterly dividend 3.7% to $0.28 and repurchased 35,000 shares in Q4 .
Management emphasized surpassing $3B in assets via organic loan growth and continuing to prioritize tangible book value accretion; TBV/share rose 13.8% YoY to $36.02 .
No Street consensus comparison: S&P Global estimates unavailable at time of review; framing catalysts include dividend increase, deposit mix shift to FHLB funding, and tax provision normalization (vs. Q3 credits) .

What Went Well and What Went Wrong

What Went Well

Organic loan growth drove total assets above $3.0B; loans receivable, net increased $38.3M QoQ and $100.5M YoY, with growth in construction/development and one-to-four-family loans; CEO: “proud to have… surpassed $3 billion in total assets” .
Tangible book value/share rose to $36.02 (+13.8% YoY) and book value/share reached $38.26; CFO: focus on “risk adjusted returns and growing tangible book value remains a mainstay” .
Home lending gross margins improved to 3.14% (vs. 2.96% in Q3 and 3.09% YoY) even as volumes normalized; Q4 one-to-four-family sales were $138.9M .

What Went Wrong

EPS and net income declined QoQ/YoY as Q3’s tax credit benefit reversed to a $2.5M provision; noninterest expense increased $1.9M YoY, driven by salaries/benefits, data processing, and professional fees .
Deposits decreased 3.6% QoQ (and 7.3% YoY) with brokered CDs down $107.2M, requiring higher borrowings (+$144.0M QoQ); uninsured deposits edged up to ~$652.7M .
Credit metrics weakened: nonperforming loans rose to $13.6M (0.54% of gross loans), ACLL coverage to NPLs declined to 234.6%, and net charge-offs increased YoY; management cited volatile economic conditions .

Financial Results

Metric	Q2 2024	Q3 2024	Q4 2024
Net Interest Income ($USD Millions)	$30.401	$31.244	$31.114
Noninterest Income ($USD Millions)	$5.868	$5.967	$4.610
Noninterest Expense ($USD Millions)	$23.857	$25.832	$24.351
Net Income ($USD Millions)	$8.959	$10.286	$7.382
Diluted EPS ($USD)	$1.13	$1.29	$0.92
Net Interest Margin (%)	4.29%	4.35%	4.31%
Efficiency Ratio (%)	65.78%	69.42%	68.16%

Segment net income (Commercial & Consumer Banking vs. Home Lending)

Metric	Q4 2023	Q3 2024	Q4 2024
Commercial & Consumer Banking Net Income ($USD Millions)	$10.026	$9.268	$7.421
Home Lending Net Income ($USD Millions)	$(0.254)	$1.018	$(0.039)
Total Net Income ($USD Millions)	$9.772	$10.286	$7.382

Key KPIs and balance sheet

Metric	Q2 2024	Q3 2024	Q4 2024
Total Deposits ($USD Millions)	$2,382.803	$2,427.331	$2,339.418
Loans Receivable, Net ($USD Millions)	$2,457.184	$2,463.697	$2,501.951
Borrowings ($USD Millions)	$181.895	$163.806	$307.806
Noninterest-bearing Deposits ($USD Millions)	$623.349	$657.753	$638.158
Certificates of Deposit (Subtotal, $USD Millions)	$1,097.222	$1,112.221	$1,028.896
Average Total Cost of Funds (%)	2.38%	2.39%	2.38%
ROA (%)	1.22%	1.38%	0.98%
ROE (%)	12.72%	14.08%	9.88%
NPA / Assets (%)	0.39%	0.36%	0.45%
NPL / Gross Loans (%)	0.46%	0.43%	0.54%
ACLL / NPL (x)	273.95%	290.07%	234.55%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Quarterly Dividend/Share	Q4 2024	$0.27	$0.28 (payable Feb 20, 2025)	Raised
Share Repurchase Authorization	Q4 2024	$5.0M program completed	Additional $5.0M authorized (through Oct 31, 2025)	Raised/Extended
Share Repurchases Executed (Q4)	Q4 2024	N/A	35,000 shares at $48.47 avg; $4.7M remaining under existing plan	Activity Update

No formal revenue/expense/tax-rate guidance provided in filings; ongoing strategy commentary focuses on funding mix, portfolio growth, and tangible book value priorities .

Earnings Call Themes & Trends

Note: Q4 2024 earnings call transcript not available in our document set; themes below reflect quarterly disclosures.

Topic	Previous Mentions (Q2 2024)	Previous Mentions (Q3 2024)	Current Period (Q4 2024)	Trend
Funding mix (brokered CDs vs. FHLB)	Nonretail CDs ↓$71.2M; borrowings ↑$52.0M on favorable rates	Brokered CDs ↓$10.8M; deposits ↑$44.5M; borrowings ↓$18.1M	Brokered CDs ↓$107.2M; borrowings ↑$144.0M (rate-driven)	Pivot from brokered CDs to FHLB borrowings
Mortgage banking volumes/margins	Sales $164.5M; margins 2.96% (down QoQ)	Sales $167.6M; margins 2.96% (flat QoQ)	Sales $138.9M; margins 3.14% (up QoQ)	Activity moderating; margins improving
NIM and cost of funds	NIM 4.29%; cost 2.38%	NIM 4.35%; cost 2.39%	NIM 4.31%; cost 2.38%	Stable NIM; plateauing cost of funds
Credit quality	NPL 0.46%; net charge-offs $1.2M	NPL 0.43%; net charge-offs $1.6M	NPL 0.54%; net charge-offs $0.983M; ACLL/NPL ↓	Mixed: NPL growing; charge-offs volatile
Capital & TBV	TBV/share $34.66	TBV/share $35.10	TBV/share $36.02	Consistent TBV accretion

Management Commentary

CEO Joe Adams: “Despite economic volatility… we are proud to have… surpassed $3 billion in total assets.” He also highlighted the 48th consecutive dividend increase to $0.28/share .
CFO/President Matthew Mullet: “Tangible book value (non-GAAP) per share was $36.02… a 13.8% increase year over year. The focus on risk adjusted returns and growing tangible book value remains a mainstay” .
Q3 CEO comment (context): deposit growth driven by a strategic objective to fund loan growth with core deposits, underscoring the funding discipline .
Q2 CEO comment: recognized leadership transition and Board’s support for dividend raise and repurchase plan, reiterating shareholder return priorities .

Q&A Highlights

Q4 2024 earnings call transcript was not available; no Q&A themes or clarifications could be extracted from primary sources. Disclosures emphasize funding mix changes, tax credit purchase impact in Q3 (benefit) vs. Q4 normalization (provision), and ongoing tangible book value focus .

Estimates Context

S&P Global Wall Street consensus estimates (EPS and revenue) for Q4 2024 were unavailable due to a request limit error at the time of retrieval. As a result, we cannot provide a beat/miss analysis relative to Street for this quarter.
Given the earnings mechanics, consensus revisions may need to reflect: the normalization of tax expense post-Q3 tax credits, higher borrowings replacing brokered CDs, and expense growth tied to commissions and consulting fees .

Key Takeaways for Investors

Earnings normalization: The swing from Q3 tax benefits to a Q4 tax provision depressed EPS; core spread metrics remain stable, suggesting earnings power ex-tax is intact .
Funding strategy pivot: Rapid runoff of brokered CDs and replacement with FHLB advances lifted borrowings; watch cost-of-funds trajectory as rates evolve and deposit competition persists .
Credit watchlist: NPLs rose and ACLL/NPL coverage fell; consumer/home improvement and CRE exposures merit monitoring amid “volatile economic conditions” .
Mortgage banking resilience: Margins improved despite lower volumes; ongoing MSR management and gain dynamics can add noninterest income volatility .
Capital and TBV compounding: TBV/share up 13.8% YoY; dividend increased to $0.28 and buybacks continued, supporting total shareholder return .
Segment lens: Commercial & Consumer Banking drove profits; Home Lending near breakeven in Q4; mix and allocation (including intercompany MSR gains previously) can affect segment results .
Near-term setup: Catalysts include dividend/buyback support and potential stabilization in deposit costs; risks center on credit quality trends and funding costs if rates remain elevated .

FS Bancorp, Inc. (FSBW)·Q4 2024 Earnings Summary