Union Bankshares Reports $8.8 Million Net Income for Fiscal Year 2024

Union Bankshares, Inc. reported a consolidated net income of $8.8 million for the fiscal year ending December 31, 2024, translating to basic earnings per share of $1.94, a decrease from $11.3 million and $2.50 per share in 2023. The decline in profitability was attributed to a $1.3 million loss from the sale of available-for-sale (AFS) debt securities, a $2.7 million increase in noninterest expenses, and a $1.4 million rise in credit loss expenses. However, net interest income increased by $521,000 to $38.4 million, driven by a higher volume of loans and an increase in interest rates.

The company's total consolidated assets grew by 4% to $1.53 billion, with net loans and loans held for sale rising by 12.6% to $1.16 billion, representing 75.6% of total assets. Conversely, total deposits decreased by 10.5% to $1.17 billion, primarily due to a reduction in wholesale deposit funding. The company’s reliance on borrowed funds increased significantly, with total borrowings rising to $259.7 million from $65.7 million in the previous year. The decrease in deposits was attributed to customers shifting funds into higher-yielding time deposits and spending down their balances.

In terms of operational developments, Union Bank continues to focus on enhancing its service offerings and expanding its market presence. The bank operates 18 branches and three loan centers across northern Vermont and New Hampshire, with a strong emphasis on community banking. The company has also seen an increase in its wealth management services, with income from this segment rising by 13.1% year-over-year. The bank's loan portfolio remains diversified, with a significant portion secured by real estate, which is closely monitored for credit quality.

Looking ahead, Union Bankshares anticipates some relief in funding costs due to a recent decline in short-term interest rates. The company is committed to optimizing its net interest margin and maintaining strong asset quality while navigating the challenges posed by the current economic environment. Management remains focused on gathering deposits and leveraging its community relationships to drive growth, despite the competitive pressures from larger financial institutions and alternative financial service providers. The bank's capital ratios remain strong, with total capital to risk-weighted assets at 12.5%, indicating a well-capitalized status under regulatory guidelines.