On October 24, 2024, Old Point Financial Corp (OPOF, Financial) released its 8-K filing detailing the financial results for the third quarter of 2024. The company, a prominent player in the financial services sector in the United States, operates through its subsidiaries, Old Point National Bank and Old Point Wealth Management, offering a range of commercial banking and wealth management services.
Financial Performance Overview
Old Point Financial Corp reported a net income of $2.4 million for the third quarter of 2024, with diluted earnings per share of $0.47. This represents a slight decrease from the second quarter of 2024, where net income was $2.5 million and diluted earnings per share were $0.50. However, it shows a significant improvement from the third quarter of 2023, where net income was $1.4 million with diluted earnings per share of $0.27. For the nine months ending September 30, 2024, the company achieved a net income of $6.6 million, compared to $6.2 million for the same period in 2023.
Key Financial Achievements
Old Point Financial Corp's financial achievements are highlighted by a robust increase in deposits and net interest income. Total deposits rose by $52.4 million, or 4.3%, from December 31, 2023, driven by significant contributions from large commercial customers. Net interest income for the third quarter was $12.3 million, marking a 1.6% increase from the previous quarter and a 7.7% increase from the third quarter of 2023. These achievements underscore the company's strategic focus on capitalizing on growth opportunities and maintaining a strong balance sheet.
Balance Sheet and Asset Quality
As of September 30, 2024, Old Point Financial Corp's total assets stood at $1.5 billion, an increase of $31.6 million from the end of 2023. The company experienced a decrease in net loans held for investment by $54.0 million, primarily due to reductions in consumer, construction, and commercial loans. However, residential real estate loans saw an increase of $8.8 million. The company's total stockholders' equity increased by $8.7 million, driven by net income and reduced unrealized losses in securities available-for-sale.
Challenges and Strategic Initiatives
Despite the positive financial performance, Old Point Financial Corp faced challenges, including a slight increase in non-performing assets (NPAs) to $2.7 million as of September 30, 2024. The company incurred $997 thousand in one-time costs related to cost-saving initiatives, which are expected to reduce noninterest expenses by approximately $5.0 million annually. These initiatives are crucial for maintaining financial stability and enhancing shareholder value.
Robert Shuford, Jr., Chairman, President, and CEO, stated, "Old Point delivered strong financial performance in the third quarter of 2024. We believe our commitment to prioritizing capital, asset quality, liquidity, and expense discipline continues to provide strong results for our shareholders."
Income Statement and Key Metrics
The income statement reveals a total noninterest income of $3.5 million for the third quarter, consistent with previous quarters. Noninterest expense totaled $12.4 million, reflecting a slight increase from the second quarter. The company's efficiency ratio improved to 78.53% from 86.40% in the third quarter of 2023, indicating better cost management.
| Metric | Q3 2024 | Q2 2024 | Q3 2023 |
|---|---|---|---|
| Net Income ($ million) | 2.4 | 2.5 | 1.4 |
| Diluted EPS ($) | 0.47 | 0.50 | 0.27 |
| Net Interest Income ($ million) | 12.3 | 12.1 | 11.4 |
| Efficiency Ratio (%) | 78.53 | 79.07 | 86.40 |
Conclusion
Old Point Financial Corp's third-quarter results demonstrate resilience and strategic focus in navigating economic uncertainties. The company's efforts in cost management and deposit growth are pivotal in sustaining its financial health. As Old Point Financial Corp continues to implement its strategic initiatives, it remains well-positioned to capitalize on future growth opportunities and deliver long-term value to its shareholders.
Explore the complete 8-K earnings release (here) from Old Point Financial Corp for further details.
