Catalyst Bancorp, Inc. reported a total asset increase of $7.6 million, or 2.9%, reaching $270.9 million as of December 31, 2023, compared to $263.4 million in the previous year. The company's loan portfolio grew by $11.3 million, or 8.5%, totaling $144.9 million, driven primarily by an increase in commercial loans. Net interest income rose by $470,000, or 6.4%, to $7.8 million, while net income increased to $602,000 from $180,000 in 2022. The net interest margin improved to 3.10%, up from 2.75% in the prior year, reflecting higher yields on interest-earning assets.
In terms of operational changes, Catalyst Bancorp has shifted its focus from traditional residential mortgage lending to a more diversified approach that includes commercial and industrial loans. The company has also implemented a new core processing system aimed at enhancing customer service and internal banking technology. As of December 31, 2023, the bank's total deposits were $165.6 million, a slight increase of $528,000, while borrowings surged by 110.7% to $19.4 million, reflecting the bank's strategy to support loan growth.
The bank's employee count decreased to 48 full-time equivalents from 50 in the previous year, as part of ongoing efforts to streamline operations. The company has also engaged in share repurchase programs, buying back 528,674 shares at an average cost of $11.94 per share during 2023. This activity contributed to a decline in total shareholders' equity to $84.7 million, down 4.4% from the previous year.
Catalyst Bancorp's outlook remains cautious, with management noting potential risks from economic conditions, interest rate fluctuations, and competitive pressures. The company has adopted the current expected credit losses (CECL) model, which resulted in an increase in the allowance for loan losses to $2.1 million, or 1.47% of total loans. The bank's management is focused on maintaining strong asset quality and is prepared to adjust its strategies in response to changing market conditions.
About Catalyst Bancorp, Inc.
Catalyst Bancorp, Inc. is a Louisiana-based bank holding company focused on community banking through its subsidiary, Catalyst Bank. The bank offers a range of financial services, including residential and commercial loans, and aims to attract small to mid-sized businesses. With a strategic shift towards commercial lending, Catalyst is positioned to capitalize on growth opportunities in the Acadiana region, enhancing its service offerings and expanding its branch network.
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