Financial Institutions, Inc. (FII) reported a net loss of $41.6 million for 2024, compared to a net income of $50.3 million in 2023. This resulted in a -0.68% return on average assets and a -8.74% return on average equity. The net loss was primarily due to a strategic investment securities restructuring, resulting in a pre-tax loss of $100.2 million on the sale of $653.5 million in available-for-sale securities. The company declared cash dividends of $1.20 per common share during 2024, consistent with 2023.
Net interest income decreased by $2.1 million to $163.6 million in 2024 compared to $165.7 million in 2023, primarily due to higher funding costs. The net interest margin fell to 2.86% from 2.94% in the prior year. Total assets decreased by $43.8 million to $6.12 billion at the end of 2024. Total loans increased slightly by $17.1 million to $4.48 billion, driven by growth in commercial mortgage loans, while total deposits decreased by $108.2 million to $5.10 billion.
Significant developments during the year included the sale of SDN Insurance Agency, LLC, generating $27 million in proceeds and a pre-tax gain of $13.7 million. The company also completed a common stock offering, raising net proceeds of $108.6 million. Additionally, FII announced the orderly wind-down of its Banking-as-a-Service offerings, and experienced a pre-tax loss of $18.2 million due to fraudulent activity. As of December 31, 2024, FII had 598 employees, a decrease of 26 employees from the previous year, primarily due to the sale of SDN.
The company's non-performing assets increased to $41.5 million, representing 0.68% of total assets, primarily due to one $15.5 million commercial loan placed on non-accrual status. Noninterest income decreased by $46.7 million to a net loss of $46.7 million, largely due to the investment securities restructuring and the sale of SDN. Noninterest expense increased by $41.7 million to $178.9 million, primarily due to the fraud matter and litigation settlement.
FII's outlook is subject to various risks and uncertainties, including credit risks, legal and regulatory risks, market risks, and technology and cybersecurity risks, as detailed in the 10-K filing. The company's ability to pay dividends is subject to certain restrictions, and the market price of its common stock may fluctuate significantly. The company continues to explore market expansion opportunities and acquisition targets.
About FINANCIAL INSTITUTIONS INC
About 10-K Filings
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