Executive Summary

Q3 FY2024 results were modest: net income of $0.136M and diluted EPS of $0.02; net interest margin compressed to 2.15% (from 2.28% in Q2 and 2.84% YoY) as higher funding costs outpaced asset yields .
Net interest income declined sequentially to $4.014M, while non-interest income improved to $0.725M driven by equity securities gains; expense discipline reduced salaries and benefits YoY .
Asset quality remained solid (non-performing assets/total assets 0.41%), and ACL/loans held at 0.65%; liquidity ratio was 38.9% with $65.0M of FHLB advances supporting buybacks and balance sheet needs .
The company declared a $0.03 dividend on April 17, 2024; no formal guidance was issued; Street EPS/revenue consensus was unavailable for comparison .
Stock catalysts: continued share repurchases, stable asset quality, and potential NIM stabilization if deposit pricing pressure eases (management notes intense deposit competition) .

What Went Well and What Went Wrong

What Went Well

Asset quality stable: non-performing assets/total assets decreased to 0.41% vs 0.49% at FY-end; management emphasized “strong asset quality metrics” with low delinquencies and charge-offs .
Non-interest income improved: unrealized gain on equity securities ($0.150M) and higher bank-owned life insurance earnings lifted total other income to $0.725M .
Expense control: salaries and benefits declined YoY to $2.991M; management cited staff reductions consistent with expense management initiatives .
Quote: “The interest rate environment has created significant pricing competition for deposits within our market.” (context for margin pressure and deposit mix) .
Liquidity robust: liquidity ratio 38.9% and ample FHLB capacity ($280.8M) to fund operations and deposits as needed .

What Went Wrong

Net interest margin compression: NIM fell to 2.15% (Q3) from 2.28% (Q2) and 2.84% (YoY) as deposit and borrowing costs increased faster than asset yields .
Net interest income dropped to $4.014M (vs $4.211M in Q2 and $5.533M YoY), with management noting higher average borrowings and rate-driven cost increases drove the decline .
Modest earnings: net income of $0.136M, diluted EPS $0.02, reflecting margin pressure despite non-interest income gains .
Funding costs rose: FHLB advances increased to $65.0M (from $54.0M in Q2) to support share repurchases and funding needs, pressuring spread and NIM .
No formal guidance provided; limited visibility relative to peers; consensus estimates unavailable to frame beats/misses .

Financial Results

Income Statement Highlights (Quarterly)

Metric ($USD Millions unless noted)	Q3 2023 (YoY)	Q1 2024	Q2 2024	Q3 2024
Total Interest Income	$7.608	$8.011	$8.063	$8.164
Net Interest Income	$5.533	$4.744	$4.211	$4.014
Total Other (Non-Interest) Income	$0.174	$0.650	$0.828	$0.725
Total Other (Non-Interest) Expense	$5.569	$5.225	$5.071	$5.338
Net Income	$0.183	$0.179	$0.011	$0.136
Diluted EPS	$0.01	$0.02	$0.00	$0.02

Margins and Spread

Metric	Q3 2023 (YoY)	Q1 2024	Q2 2024	Q3 2024
Net Interest Margin %	2.84%	2.52%	2.28%	2.15%
Interest Rate Spread %	2.54%	2.10%	1.90%	1.73%

Key KPIs

KPI	Q3 2023 (YoY)	Q1 2024	Q2 2024	Q3 2024
ROAA (annualized)	0.09%	0.09%	0.01%	0.07%
ROAE (annualized)	0.43%	0.47%	0.04%	0.43%
Non-Performing Assets / Total Assets	0.49%	0.45%	0.38%	0.41%
ACL / Total Loans	0.69%	0.75%	0.76%	0.65%
FHLB Advances (Period-End, $)	$34.0M	$51.0M	$54.0M	$65.0M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Formal Financial Guidance	FY/Q4 2024	None	None	Maintained (no guidance)
Dividend per Share	Declared April 17, 2024	$0.03 (prior quarter declared Jan 17, 2024)	$0.03	Maintained

Earnings Call Themes & Trends

No Q3 FY2024 earnings call transcript was filed; themes below reflect management’s MD&A across quarters.

Topic	Previous Mentions (Q1 & Q2 FY2024)	Current Period (Q3 FY2024)	Trend
Deposit competition & pricing	“Significant pricing competition for deposits” noted; deposit mix shifts (money market down, interest-bearing checking up)	Reiterated deposit pricing pressure in market impacting funding costs	Persistent pressure
Net interest margin drivers	NIM 2.52% (Q1) and 2.28% (Q2); decline due to higher deposit/borrowing costs outpacing asset yield increases	NIM fell to 2.15%; management cites higher borrowings and rate-driven cost increases	Sequential decline
Asset quality	NPA/Assets improved to 0.45% (Q1) and 0.38% (Q2) with strong metrics	Stable at 0.41%; management references strong asset quality	Stable/strong
Liquidity & borrowing	FHLB advances rose to $51.0M (Q1) and $54.0M (Q2); liquidity ratio ~40%	FHLB advances $65.0M; liquidity ratio 38.9%	Slightly higher borrowing, strong liquidity
Capital actions	Ongoing repurchases; equity declined with buybacks	Continued capital return; TBVPS relatively stable; dividend maintained	Ongoing buybacks/dividends

Management Commentary

“The interest rate environment has created significant pricing competition for deposits within our market,” framing margin pressure and deposit mix dynamics .
“Net interest margin decreased primarily due to an increase in the average balance of borrowings and the rise in interest rates that caused an increase in the cost of borrowings and deposits that exceeded the increase in interest income on loans” .
“Asset quality metrics remain strong with non-performing assets to total assets decreasing to 0.41%... low levels of delinquencies, net charge-offs and non-performing assets” .

Q&A Highlights

No earnings call transcript was available for Q3 FY2024; therefore, no Q&A highlights or call-based guidance clarifications were disclosed [ListDocuments returned 0 transcripts for WMPN].

Estimates Context

Wall Street consensus EPS and revenue estimates via S&P Global were unavailable for WMPN due to missing mapping; as a result, no beat/miss comparison can be provided (we attempted to retrieve consensus for Q1–Q3 FY2024) [SpgiEstimatesError: Missing CIQ mapping for 'WMPN'].
Implication: Investors should focus on underlying trends (NIM trajectory, deposit costs, asset quality) until coverage improves.

Key Takeaways for Investors

Margin stabilization is the swing factor: NIM compressed to 2.15%; easing deposit competition or funding mix optimization would be the primary lever to re-expand spread/NIM .
Asset quality and liquidity provide downside protection: NPA/Assets 0.41% and liquidity ratio 38.9% support resilience through rate transitions .
Funding costs bear watching: FHLB advances rose to $65.0M; elevated wholesale funding can pressure NIM if deposit repricing remains competitive .
Non-interest income is a secondary offset: equity securities gains lifted other income, but sustainability depends on market factors; core earning power hinges on NII .
Expense discipline helps: salaries/benefits declined YoY with targeted reductions, partially mitigating margin pressure .
Capital return continues: consistent $0.03 dividend and ongoing buybacks support per-share value; monitor capital ratios and TBVPS trends as repurchases proceed .
Absent formal guidance and Street estimates, focus on management’s commentary and quarterly NIM/ROAA/ROAE trajectory to gauge near-term trading setup and medium-term thesis .

William Penn Bancorporation (WMPN)·Q3 2024 Earnings Summary