Executive Summary

Q2 FY2025 delivered solid growth: net income rose 41% YoY to $2.68M, EPS of $0.43 vs $0.30 last year, with NIM expanding to 3.31% (+14 bps YoY, +9 bps QoQ) on higher asset yields and moderating funding costs .
Credit quality strengthened: non‑performing loans fell to $81K (0.01% of total loans), and NPAs declined to 0.26% of assets; allowance/loans held at 0.98% .
Deposits and liquidity improved: deposits grew to $857.7M (+$8.8M QoQ), cash and interest‑earning deposits reached $72.9M (+$14.4M QoQ) supporting loan growth to $809.0M .
Capital returns: dividend raised to $0.06 in Q2 (from $0.05 in FY2024), and post‑quarter the Board authorized a new buyback of up to 5% of shares after completing the prior program (337,146 shares at $12.23 avg) .

What Went Well and What Went Wrong

What Went Well

Net interest margin expanded to 3.31%, supported by a 23 bps increase in asset yields to 5.68% and a 13 bps decline in liability costs YoY; NII grew 13.8% to $7.88M .
Fee and other income surged 104% YoY to $1.27M, led by stronger SBA 7(a) loan sale gains ($612K vs $213K YoY) and higher prepayment/late charges and BOLI income .
Asset quality improved meaningfully: NPLs decreased to $81K (0.01% of loans), NPAs/Assets to 0.26%, while deposits increased $61.0M YTD, strengthening liquidity and supporting growth .
CEO tone constructive: “another strong quarter… expansion in our net interest margin, and an extremely low level of non‑performing assets… well positioned to navigate the current market volatility” .

What Went Wrong

Operating expenses rose 5.7% YoY (+$290K) on higher compensation/benefits and seasonal occupancy costs (snow/ice removal), with marketing and loan servicing also up .
Effective tax rate rose to 29.0% (vs 21.7% YoY), lifting tax expense to $1.10M and tempering the flow‑through from higher pre‑tax income .
No formal financial guidance was provided; transparency on forward NIM/credit cost trajectory remains limited outside qualitative commentary and ongoing capital return actions .

Financial Results

Income statement and profitability (YoY and QoQ)

Metric	Q2 2024	Q1 2025	Q2 2025
EPS ($)	$0.30	$0.34	$0.43
Net Income ($M)	$1.90	$2.09	$2.68
Net Interest & Dividend Income ($M)	$6.92	$7.44	$7.88
Other Income ($M)	$0.62	$0.96	$1.27
Provision for (Recovery of) Credit Losses ($000)	$14	$101	$(30)
Effective Tax Rate (%)	21.7%	27.9%	29.0%
Net Interest Margin (%)	3.17%	3.22%	3.31%
ROA (annualized, %)	0.81%	0.86%	1.05%
ROE (annualized, %)	7.13%	7.42%	9.55%

Balance sheet and credit metrics (period end)

Metric	Sep 30, 2024	Dec 31, 2024	Mar 31, 2025
Total Assets ($M)	$951.9	$1,008.4	$1,021.9
Total Loans Receivable ($M)	$780.2	$805.5	$809.0
Deposits ($M)	$796.7	$848.8	$857.7
Cash & Interest‑Earning Deposits ($M)	$25.6	$58.5	$72.9
Book Value/Share ($)	$16.98	$17.23	$17.65
Non‑Performing Loans ($000)	$232	$339	$81
NPLs / Total Loans (%)	0.03%	0.04%	0.01%
NPAs / Total Assets (%)	0.42%	0.29%	0.26%
Allowance for Credit Losses / Loans (%)	0.97%	0.98%	0.98%

Revenue (S&P Global) – “Total revenue” proxy

Metric	Q4 2024	Q1 2025	Q2 2025
Revenue ($M)	$9.35*	$8.30*	$9.17*

Values retrieved from S&P Global.
Note: For banks, “Revenue” reflects S&P Global’s convention (generally NII + noninterest income).

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Dividend per share	Quarterly	$0.05 (declared Nov 2024)	$0.06 (declared Apr 30, 2025; payable May 28, 2025)	Raised
Share repurchase authorization	Ongoing	Prior program completed: 337,146 shares at $12.23 avg (authorized Dec 8, 2022)	New authorization: up to 5% of shares (≈323,547 shares)	New program
Financial guidance (revenue/margins/expenses)	FY2025	Not provided	Not provided	Maintained (no formal guidance)

Earnings Call Themes & Trends

Note: No earnings call transcript located for Q2 FY2025; analysis reflects press releases/8‑K disclosures from the last three quarters .

Topic	Q4 2024 (Q‑2)	Q1 2025 (Q‑1)	Q2 2025 (Current)	Trend
Net interest margin	NIM up to 3.08% from 3.02% linked quarter	NIM 3.22%; seeing benefits of late‑2024 Fed cuts	NIM 3.31%; +14 bps YoY on higher asset yields and lower liability costs	Improving
Credit quality	Record OREO gains; disciplined collateral pursuit	OREO sales gains; NPLs 0.04% of loans	NPLs 0.01%; NPAs/Assets 0.26%	Strengthening
Deposit flows/liquidity	Planned to fund growth; cautious environment	Deposits +6.5% QoQ; cash balances up to $58.5M	Deposits +$61.0M YTD; cash/IEDs $72.9M	Improving
Loan growth	FY2024 loans +12% YoY	Loans +$25.3M QoQ; CRE led increases	Loans +$29.0M YTD; CRE +$33.9M, construction down	Mixed mix; steady growth
Capital return	Dividend $0.05 declared	Dividend $0.06 declared	Dividend $0.06; new repurchase program post‑quarter	Increasing
Footprint/product	Opened Martinsville branch	Emphasis on community banking model	Focus on relationships and balance sheet management	Consistent

Management Commentary

“We are very pleased to report another strong quarter, highlighted by a 41% increase in net income, an expansion in our net interest margin, and an extremely low level of non‑performing assets… well positioned to navigate the current market volatility” — John Fitzgerald, President & CEO .
Drivers: NIM expansion was supported by a higher yield on interest‑earning assets (5.68%, +23 bps YoY) and lower cost of interest‑bearing liabilities (3.02%, −13 bps YoY) with asset growth also contributing .
Fee momentum: SBA 7(a) loan sale gains rose to $612K (from $213K), alongside higher prepayment/late charges and BOLI income .

Q&A Highlights

No Q2 FY2025 earnings call transcript was found; the company’s disclosures for the quarter were provided via press release and Form 8‑K Exhibit 99.1 .

Estimates Context

S&P Global consensus: No EPS or revenue consensus figures were available for MGYR for Q2 FY2025 (micro‑cap coverage is limited). As a result, a beat/miss assessment versus Wall Street consensus is not determinable this quarter. Values retrieved from S&P Global.
Actuals vs. consensus (where available):
- EPS: $0.43 actual; Consensus: N/A .
- Revenue (S&P “total revenue” proxy): $9.17M* actual; Consensus: N/A. Values retrieved from S&P Global.

Key Takeaways for Investors

NIM expansion appears durable near‑term given higher asset yields and easing funding costs; continued balance sheet growth should support NII, though tax rate normalization (29%) partially offsets EPS leverage .
Credit remains a differentiator: exceptionally low NPLs (0.01%) and declining NPAs provide cushion if macro volatility persists and underpin capital return capacity .
Fee growth drivers (SBA 7(a) sales, prepayment fees, BOLI income) broaden revenue sources beyond NII, adding resilience as rates normalize .
Capital return accelerating: dividend at $0.06 and new 5% buyback authorization post‑quarter provide support for TSR and flexibility around capital deployment .
Deposit momentum and liquidity strength (cash/IEDs $72.9M) mitigate wholesale funding needs and position the bank to fund a healthy loan pipeline .
Watch list: expense trajectory (comp/benefits, occupancy) and any shift in credit costs as mix tilts to CRE; efficiency investments may be needed to sustain operating leverage .
With limited Street coverage, trading could react more to company‑specific disclosures (dividends/buybacks/credit data) than to consensus‑driven beats/misses; upcoming quarters’ NIM trend and deposit mix will be key catalysts .

Supporting Detail – Additional Press Releases

KBW Bank Honor Roll: Magyar named for the second consecutive year, highlighting consistent earnings growth .
New repurchase program: Up to 5% of outstanding shares authorized after completing prior program; timing to depend on market and liquidity considerations .

Magyar Bancorp, Inc. (MGYR)·Q2 2025 Earnings Summary