First Keystone Corp reported its financial results for the third quarter and the nine months ended September 30, 2024, highlighting significant changes in revenue, profitability, and strategic developments compared to the previous fiscal period.

For the three months ended September 30, 2024, the company achieved a net income of $1,507,000, an increase of $224,000 from $1,283,000 in the same period of 2023. This translated to earnings per share of $0.25, up from $0.21. Total interest income rose to $18,242,000, reflecting a 28.1% increase from $14,237,000 in Q3 2023, while net interest income also increased by 18.4% to $8,154,000. However, total non-interest expense increased to $7,820,000 from $7,420,000, driven primarily by higher salaries and benefits, which accounted for 55.9% of total non-interest expenses.

In contrast, the nine-month period ended September 30, 2024, saw a net loss of $15,490,000, a significant decline from a net income of $3,779,000 in the same period of 2023. This loss per share was $(2.52), compared to earnings of $0.62 in the prior year. The substantial loss was attributed to a goodwill impairment charge of $19,133,000 recognized in Q1 2024, following a decrease in the company's stock price.

Total assets increased to $1,438,693,000 as of September 30, 2024, up from $1,415,870,000 at year-end 2023. Total loans rose by 2.6% to $934,599,000, with real estate loans increasing by 3.0% to $836,213,000. Total deposits also grew by 4.0% to $1,019,909,000, driven by increases in retail and brokered certificates of deposit.

The company’s allowance for credit losses increased to $7,657,000 from $6,925,000 at year-end 2023, reflecting a proactive approach to managing credit risk amid economic uncertainties. Net charge-offs for the nine months ended September 30, 2024, were $760,000, a notable increase from $2,000 in the same period of 2023.

Strategically, First Keystone Corp has focused on enhancing its loan portfolio, with a significant emphasis on real estate lending. The company has also been actively managing its interest rate risk, with projections indicating potential impacts on net interest income under various interest rate scenarios.

Overall, while the company demonstrated growth in certain areas, the substantial net loss for the nine-month period underscores the challenges faced, particularly related to goodwill impairment and credit losses.