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OLD POINT FINANCIAL CORP (OPOF)·Q4 2024 Earnings Summary

Executive Summary

  • Old Point delivered record FY24 earnings ($9.5M, $1.88 EPS) and solid Q4 performance: net income rose 20.9% QoQ to $2.9M ($0.57 EPS) and nearly doubled YoY, while NIM eased modestly to 3.53% FTE .
  • Deposits grew 2.0% YoY to $1.25B, with strong noninterest-bearing inflows from large commercial and municipal customers; liquidity was robust at $460M (31.7% of assets), despite loan contraction reflecting portfolio “right‑sizing” .
  • Operating discipline remains a key narrative: noninterest expense fell sequentially, with 2024 actions reducing headcount ~12% and driving a lower run-rate; professional services normalized after legal matter settlements in Q3 .
  • Asset quality stayed strong: NPAs were 0.19% of assets; provision for credit losses decreased sharply YoY and QoQ, and the ACL/loans was stable at 1.13% .
  • Catalyst: Continued expense control and deposit strength, plus durable asset quality, underpin earnings resilience into 2025; dividend held at $0.14 (1.9% yield on 2/18/25 price) supports income investor interest .

What Went Well and What Went Wrong

What Went Well

  • Record 2024 earnings and sequential EPS growth: “Despite a challenging banking environment, we delivered record earnings in 2024” (CEO); Q4 net income rose 20.9% QoQ to $2.9M ($0.57 EPS) .
  • Deposit and liquidity strength: Total deposits +2.0% YoY with robust noninterest-bearing growth; liquidity expanded to $460M (31.7% of assets), enabling paydown of higher-cost borrowings .
  • Expense control traction: Q4 noninterest expense fell QoQ; 2024 initiatives cut headcount ~12% and supported lower efficiency ratio vs. prior year’s Q4 .

What Went Wrong

  • Net interest income flat-to-down sequentially: Q4 NII of $12.25M decreased $58K QoQ as average loan balances fell; NIM contracted to 3.53% FTE from 3.57% FTE QoQ .
  • Loan contraction: Net loans fell to $998.7M (-6.5% YoY), driven by declines in consumer, construction, and commercial exposures, partly offset by residential real estate growth .
  • Noninterest income softness: Q4 noninterest income declined to $3.24M vs. $3.47M in Q3, pressured by lower service charges/fees and losses on sales of repossessed assets; mortgage banking continued to be weak on strategic shift and market conditions .

Financial Results

MetricQ4 2023Q2 2024Q3 2024Q4 2024
Net Interest Income ($USD Millions)$11.86 $12.12 $12.31 $12.25
Noninterest Income ($USD Millions)$3.49 $3.47 $3.47 $3.24
Total Revenue (FTE, non-GAAP) ($USD Millions)$15.39 $15.62 $15.82 $15.53
Net Income ($USD Millions)$1.48 $2.53 $2.38 $2.88
Diluted EPS ($)$0.29 $0.50 $0.47 $0.57
NIM (FTE, %)3.46% 3.63% 3.57% 3.53%
ROA (%)0.40% 0.71% 0.64% 0.77%
ROE (%)5.88% 9.43% 8.39% 9.96%
Efficiency Ratio (%)79.53% 79.07% 78.53% 78.01%

Segment/Noninterest Income Breakdown (selected components)

Component ($USD Thousands)Q4 2023Q3 2024Q4 2024
Fiduciary & Asset Mgmt Fees1,350 1,126 1,212
Service Charges on Deposit Accounts780 858 798
Other Service Charges, Commissions & Fees888 1,070 904
Bank-Owned Life Insurance Income262 285 274
Mortgage Banking Income (Loss)82 (2) 0
Loss on Sale of Repossessed Assets0 (25) (65)
Other Operating Income111 160 121
Total Noninterest Income3,493 3,472 3,244

Key Performance Indicators

KPIQ4 2023Q2 2024Q3 2024Q4 2024
Loans, Net ($USD Thousands)1,068,046 1,042,774 1,014,012 998,713
Deposits ($USD Thousands)1,230,397 1,236,575 1,282,786 1,254,914
Total Assets ($USD Thousands)1,446,382 1,423,354 1,478,009 1,450,570
NPAs ($USD Thousands)2,183 1,959 2,695 2,695
NPAs / Total Assets (%)0.15% 0.14% 0.18% 0.19%
ACL on Loans / Total Loans (%)1.13% 1.12% 1.14% 1.13%
Annualized Net Charge-Offs / Avg Loans (%)0.39% 0.12% 0.18% 0.16%
Liquidity ($USD Millions; % Assets)$342.5; 23.7% $403.8; 28.4% $497.7; 33.7% $460.0; 31.7%

Drivers/Why:

  • NII down slightly QoQ on lower average loan balances; partially offset by higher average securities at improved yields .
  • Noninterest income declined QoQ due to lower service charges/fees and higher losses on repossessed asset sales; fiduciary fees helped offset .
  • Expenses decreased QoQ as professional services normalized (Q3 included $240K legal settlements) and data processing/occupancy fell; incentive comp increased on record net income .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Noninterest expense reduction initiativesFY24 into FY25 run-rate~$5.0M annualized pre-tax savings (excluding one-time costs) when fully implemented Continued cost-saving measures; no updated numeric range provided Maintained (no numeric update)
Quarterly Dividend per ShareQ4 2024 → Q1 2025$0.14 per share $0.14 per share; ~1.9% annual yield at $29.73 close (2/18/25) Maintained

No formal revenue/NIM/OpEx/tax rate guidance ranges were issued in Q4 materials .

Earnings Call Themes & Trends

Note: A Q4 2024 earnings call transcript was not available in our document catalog; themes tracked via Q2/Q3/Q4 press releases.

TopicPrevious Mentions (Q2 2024)Previous Mentions (Q3 2024)Current Period (Q4 2024)Trend
Expense discipline/cost savingsInitiatives underway; ~$5.0M annualized pre-tax savings expected; headcount reduced ~12% by late Q1/Q2 One-time costs finalized ($997K YTD); savings reiterated; headcount down ~12% Continued cost-saving measures; positioning to capitalize on opportunities Positive; run-rate benefits progressing
Deposit growth & liquidityDeposits +0.5% YTD; liquidity 28.4% of assets Deposits +4.3% YTD; liquidity 33.7% Deposits +2.0% YoY; liquidity 31.7% Strong, sustained
Loan portfolio mix/right‑sizingDeclines in consumer, construction, commercial; increases in residential & CRE Continued declines in consumer, construction, commercial & CRE; residential up Declines in consumer, construction, commercial; residential up Ongoing contraction in targeted categories
Asset qualityNPAs 0.14%; net charge-offs 0.12% NPAs 0.18%; net charge-offs 0.18% NPAs 0.19%; net charge-offs 0.16% Stable at low levels
Mortgage bankingDown due to strategy shift & market conditions Continued decline on strategic shift Declined; strategic shift & industry conditions Weak/managed down
Capital metricsWell-capitalized; book value up Well-capitalized; book value $22.74 Well-capitalized; book value $22.44 Stable

Management Commentary

  • CEO (Q4): “Despite a challenging banking environment, we delivered record earnings in 2024… cost-saving measures… and our strategic growth plan will allow us to capitalize on new opportunities and continue to provide value to our shareholders.”
  • Strategic focus: Prioritizing capital, asset quality, liquidity, and expense discipline highlighted across releases .
  • Balance sheet positioning: Deployment of liquidity into higher earning assets improved average earning asset yields, while deposit mix moved favorably (NIB growth) .

Q&A Highlights

  • Not available; a Q4 2024 earnings call transcript was not found in our document catalog or searches. We reviewed Q4 2024 press release and the associated 8-K furnishing the release .

Estimates Context

  • S&P Global consensus for Q4 2024 EPS and revenue was unavailable for OPOF due to missing SPGI/CIQ mapping at the time of query. We attempted retrieval but did not receive values [SpgiEstimatesError: Missing CIQ mapping].
  • Implication: We cannot label beats/misses versus Wall Street consensus for Q4 2024.

Key Takeaways for Investors

  • Earnings momentum with record FY24 and stronger Q4 profitability, supported by disciplined cost control and favorable deposit mix; NIM drift modestly lower QoQ on loan contraction but remains resilient .
  • Deposits and liquidity are material positives—noninterest-bearing growth from large customers and $460M of liquidity provide funding flexibility and reduce reliance on higher-cost borrowings .
  • Loan portfolio “right‑sizing” is intentional; further contraction in consumer/construction/commercial balances reduces risk and supports margin stability amid rate uncertainty .
  • Noninterest income headwinds (mortgage banking, repossessed asset losses) are manageable; fiduciary & asset management fees remain a steady contributor .
  • Asset quality remains a pillar: low NPAs, stable ACL/loans, and reduced provision vs. prior year support credit-cost visibility into 2025 .
  • Dividend sustained at $0.14; ~1.9% yield at recent price supports total return profile; payout ratio 24.7% in Q4 allows retention for capital and growth .
  • Near-term trading: Favorable setup on earnings resilience and deposit/liquidity strength; watch NIM trajectory, loan mix shifts, and noninterest income normalization as rate environment evolves .

Appendix: Additional Q4 Materials

  • 8-K furnishing Q4 & FY24 results (press release attached as Exhibit 99.1) .
  • Quarterly dividend announcement (Feb 19, 2025): $0.14 per share; ~1.9% yield at $29.73 close (2/18/25) .
  • Prior quarter releases for trend analysis: Q3 2024 (Oct 24) and Q2 2024 (Jul 25) .