Home Federal Bancorp, Inc. of Louisiana reported its financial results for the three months ended September 30, 2024, revealing a decrease in net income to $941,000, down from $1,220,000 in the same period of 2023. This decline was primarily attributed to a significant drop in net interest income, which fell by $857,000 (16.2%) to $4,427,000, driven by an increase in total interest expense of $524,000 (18.8%) and a decrease in total interest income of $333,000 (4.1%). The average interest rate spread also narrowed to 2.23% from 2.68% year-over-year, with the net interest margin decreasing to 2.98% from 3.37%.

Total assets decreased by $9.1 million (1.4%) to $628.4 million as of September 30, 2024, compared to $637.5 million at the end of June 2024. The decline in assets was accompanied by a decrease in net loans receivable, which fell by $16.8 million (3.6%) to $454.0 million. Total deposits also decreased by $9.4 million (1.6%) to $564.6 million, largely due to an 8.2% drop in certificates of deposit.

On the positive side, total stockholders’ equity increased by $1.5 million (2.8%) to $54.3 million, supported by the net income generated during the quarter. The company reported a recovery of credit losses amounting to $223,000, reflecting a decrease in loans receivable.

Non-interest income for the quarter decreased by $134,000 (30.9%) compared to the prior year, primarily due to a $220,000 increase in losses on the sale of real estate. However, this was partially offset by gains on loan sales, which increased by $58,000. Non-interest expenses decreased by $177,000 (4.2%), attributed to reductions in various operational costs, including advertising and compensation expenses.

As of September 30, 2024, the company held cash and cash equivalents of $41.0 million, an increase of $6.1 million (17.4%) from the previous quarter. The allowance for credit losses rose to $4.7 million from $4.6 million, reflecting ongoing adjustments in response to credit quality assessments.

Home Federal Bank's regulatory capital ratios remained strong, with common equity tier 1 and tier 1 capital at 13.19%, total capital at 14.29%, and leverage at 9.02%. The company continues to navigate a challenging economic environment while maintaining a focus on its core banking operations in the Shreveport-Bossier City-Minden area of Louisiana.