Executive Summary

Q4 2024 EPS was $0.65 diluted ($0.67 basic), up vs. $0.62 diluted ($0.64 basic) in Q4 2023, with drivers including higher net interest income, lower provision (a recovery), and stronger non-interest income; partially offset by higher non-interest expense .
Net interest margin improved sequentially and year-over-year to 3.39% (from 3.35% in Q3 2024 and 3.32% in Q4 2023) as loan yields and security yields trended favorably and deposit mix stabilized .
Credit remained benign: provision was a $0.205M recovery (vs. $0.405M expense in Q4 2023) as the Hurricane Helene reserve was reduced; NPAs were 0.29% of assets (vs. 0.24% at 12/31/23), ACL/loans 0.88% (vs. 1.01% at 12/31/23) .
Capital return momentum: regular $0.19 dividend declared for Q4 2024, a special $0.16 dividend announced in January 2025, and a new $3.0M share repurchase authorization in March 2025—potential supports for the stock .

What Went Well and What Went Wrong

What Went Well
- EPS grew year-over-year as net interest income rose to $13.81M and non-interest income increased to $7.06M; NIM expanded to 3.39% with a recovery in provision for credit losses, lifting pre-tax income to $4.59M .
- Appraisal management fee income was a notable tailwind, rising to $3.02M in Q4 (vs. $2.12M in Q4 2023), reflecting stronger appraisal volume, also seen earlier in 2024 .
- Management highlighted that “minimal losses are expected as a result of Hurricane Helene,” supporting the provision recovery and overall credit outlook .
What Went Wrong
- Non-interest expense rose to $16.49M (vs. $14.57M in Q4 2023), driven by higher salaries/benefits (+$0.67M), appraisal management fee expense (+$0.72M), and “other” expenses (+$0.48M), including consulting and debit card fraud expense .
- NPAs increased to $4.8M (0.29% of assets) from $3.9M (0.24%) year-over-year, with increases in residential mortgage NPAs and other real estate owned, though still low in absolute terms .
- Effective tax rate ticked up to 22.44% (vs. 22.24% in Q4 2023); management also noted year 2024 taxes reflected deferred tax revaluation due to the phasedown of North Carolina’s corporate income tax .

Financial Results

Metric	Q4 2023	Q3 2024	Q4 2024
Net Interest Income ($M)	$13.27	$13.55	$13.81
Provision for Credit Losses ($M)	$0.405	$0.297	$(0.205)$ (recovery)
Non-Interest Income ($M)	$6.13	$7.10	$7.06
Non-Interest Expense ($M)	$14.57	$15.02	$16.49
Pre-Tax Income ($M)	$4.42	$5.33	$4.59
Net Earnings ($M)	$3.44	$3.96	$3.56
Diluted EPS ($)	$0.62	$0.72	$0.65
Net Interest Margin (tax-equivalent)	3.32%	3.35%	3.39%
Effective Tax Rate	22.24%	25.76%	22.44%

Non-interest income breakdown (Q4):

Non-Interest Income ($M)	Q4 2023	Q4 2024
Service Charges	$1.42	$1.45
Other Service Charges/Fees	$0.19	$0.16
Mortgage Banking Income	$0.10	$0.09
Insurance & Brokerage	$0.20	$0.27
Appraisal Mgmt. Fee Income	$2.12	$3.02
Miscellaneous	$2.10	$2.06
Total Non-Interest Income	$6.13	$7.06

Key performance indicators (period-end):

KPI	Dec 31, 2023	Sep 30, 2024	Dec 31, 2024
Total Assets ($B)	$1.636	$1.662	$1.652
Total Loans ($B)	$1.093	$1.124	$1.138
Total Deposits ($B)	$1.392	$1.480	$1.485
Core Deposits ($B, % of deposits)	$1.24 (89.30%)	$1.34 (90.30%)	$1.34 (90.17%)
NPAs ($M, % of assets)	$3.9 (0.24%)	$3.9 (0.24%)	$4.8 (0.29%)
ACL / Loans (%)	1.01%	0.94%	0.88%
Securities Sold Under Repo ($M)	$86.7	$8.4	$0.0

KPIs (Q4 run-rate):

KPI	Q4 2023	Q4 2024
ROAA	0.84%	0.85%
ROAE	12.72%	10.77%

Note: PEBK does not report segment financials; appraisal management is a major fee line item rather than a reportable segment .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Regular Cash Dividend	Q4 2024	$0.19 per share (maintained)	$0.19 per share (paid Dec 13, 2024 to holders of record Dec 3)	Maintained
Special Cash Dividend	1Q25 (declared Jan 17, 2025)	N/A	$0.16 per share (paid Feb 14, 2025)	New special dividend
Regular Cash Dividend	1Q25	$0.19 per share	$0.20 per share (to be paid Mar 14, 2025)	Raised
Share Repurchase Authorization	Announced Mar 13, 2025	None announced	Up to $3.0M authorization	New program

No formal quantitative guidance was provided on revenue, margins, OpEx, or tax beyond commentary on tax effects and balance sheet/capital actions .

Earnings Call Themes & Trends

No Q4 2024 earnings call transcript was available in the document set or via our search; analysis below uses management commentary from earnings releases.

Topic	Q2 2024 (prior two quarters)	Q3 2024 (prior quarter)	Q4 2024 (current)	Trend
Interest Rate Environment/NIM	NIM 3.34%; higher asset yields offset by higher deposit costs; Fed rate impact on loans/securities yields noted .	NIM 3.35%; similar dynamics; rising time deposits and deposit rates pressured funding costs .	NIM 3.39%; further sequential improvement; variable-rate securities and loan growth supported interest income .	Improving sequential NIM.
Credit/Provision	Provision recovery ($0.468M) on reduced construction loan reserves; ACL/loans 0.90% .	Provision $0.297M; added $0.669M Helene reserve; ACL/loans 0.94% .	Provision recovery ($0.205M) as Helene reserve reduced to $60K (from $669K); ACL/loans 0.88% .	Provision normalized; Helene reserve largely unwound.
Appraisal Management Fees	Income up $0.59M YoY; expense up $0.47M YoY (volume-driven) .	Income +$0.29M YoY; expense +$0.25M YoY (volume-driven) .	Income +$0.90M YoY; expense +$0.72M YoY (volume-driven) .	Strong fee tailwind, with expense follow-through.
Expenses/One-offs	Higher comp, appraisal expense, consulting/debit card expense .	Occupancy included $0.362M write-off tied to branch closure; higher consulting .	Higher comp (salary/SERP), appraisal expense, consulting/debit card fraud costs .	Elevated noninterest expenses; some one-time items earlier.
Deposits/Funding	Total deposits $1.48B; ICS usage rising; core deposits 90.02% .	$1.48B deposits; ICS shift continued; repo balances dropped materially .	$1.485B deposits; core deposits 90.17%; repos moved to $0 via ICS .	Stable deposits; funding mix improving via ICS.
Taxes/Policy	Q2 ETR ~22%; normal .	ETR elevated (25.76%) due to NC deferred tax revaluation .	ETR ~22.44%; 2024 reflects NC tax rate phasedown .	One-time Q3 tax effect; normalized thereafter.

Management Commentary

“Net earnings were $3.6 million… for the three months ended December 31, 2024… attributed… to an increase in net interest income, a decrease in the provision for credit losses and an increase in non-interest income… partially offset by an increase in non-interest expense” — William D. Cable, Sr., President & CEO .
“The decrease in the provision… is primarily attributable to a $609,000 decrease in the reserve for losses associated with Hurricane Helene… Minimal losses are expected as a result of Hurricane Helene.” .
“The effective tax rate was 21.86% for the year ended December 31, 2024… reflects the revaluation of the deferred tax asset due to planned reductions in the North Carolina corporate income tax rate…” .
“Securities sold under agreements to repurchase were zero at December 31, 2024, compared to $86.7 million at December 31, 2023,” with customers shifting to ICS deposits .

Q&A Highlights

No public Q4 2024 earnings call transcript was available; no Q&A to report based on the document set reviewed (8-K/press releases) and document search results showed no transcript for PEBK in the period.

Estimates Context

S&P Global consensus estimates could not be retrieved due to an access limit; as a result, we cannot present objective “vs. consensus” comparisons for Q4 2024. This may reflect limited or no published Street coverage and/or temporary data access constraints (SPGI daily request limit exceeded). Where estimates are unavailable, investors should rely on actuals and operating trend analysis presented above [GetEstimates errors].

Key Takeaways for Investors

Earnings quality improved with a provision recovery and NIM expansion; the Helene-related reserve largely unwound, supporting a stable credit narrative into 2025 .
Fee momentum from appraisal management remains a differentiator, though it carries associated expense growth; monitoring net contribution from this line is key .
Expense discipline bears watching after multi-quarter increases (comp, appraisal-related, consulting, fraud costs); any normalization could drive operating leverage .
Funding mix is improving: core deposits are ~90% of total; repurchase agreements moved to $0 as clients migrated to ICS—beneficial for liquidity optics and cost of funds .
Capital return stepped up through a special dividend and new $3.0M buyback authorization; together with regular dividends, this underpins shareholder yield and could support valuation .
With limited Street estimate visibility, trading likely keys off realized NIM, expense trajectory, credit quality, and capital return cadence; the setup looks constructive if funding costs remain contained and fees stay resilient .

Sources

Q4 2024 8-K and press release (including financial statements and highlights) .
Q3 2024 8-K and press release (comparatives, balance sheet trends, one-off items) .
Q2 2024 8-K and press release (comparatives and fee/expense dynamics) .
Other relevant press releases for Q4 period and shortly after: Q4 2024 dividend (Nov 22, 2024) ; special dividend (Jan 17, 2025) ; Q1 2025 dividend (Feb 21, 2025) ; $3.0M repurchase authorization (Mar 13, 2025) .

PEOPLES BANCORP OF NORTH CAROLINA INC (PEBK)·Q4 2024 Earnings Summary