First Keystone Announces Fourth Quarter 2025 Earnings (Unaudited)
MWN-AI** Summary
First Keystone Corporation (OTC: FKYS), the parent company of First Keystone Community Bank, reported its unaudited fourth-quarter earnings for 2025, highlighting significant financial growth. The company's interest income rose by $5.84 million, or 8.2%, compared to 2024, driven primarily by increased commercial real estate loans. Although total interest expenses increased slightly by $405,000, primarily due to higher deposit-related costs, there was a notable decrease in expenses from short- and long-term borrowings.
Deposits grew by $91.56 million, or 8.8%, largely due to a shift toward retail CDs, with balances rising by $135.73 million. The corporation experienced a migration of funds from other deposit products into CDs, with brokered CDs also seeing an increase in balances. Furthermore, the net effect of derivative agreements contributed positively, boosting net interest income by $583,000.
Notably, the provision for credit losses increased by $1.27 million owing to a significant charge-off in the fourth quarter, although this event was viewed as isolated and not reflective of broader loan portfolio trends. Non-interest income also increased by $627,000, signaling a 9.4% uptick from the previous year, aided by gains from life insurance proceeds and improved sales of mortgage loans.
A major highlight of the earnings report was the substantial decrease in non-interest expenses, down 32.8% due to a large goodwill impairment recognized in early 2024. The corporation's net income soared to $7.62 million, marking an increase of approximately $20.83 million from 2024, primarily influenced by the prior year’s impairment charge.
As of December 31, 2025, total assets reached $1.53 billion, reflecting a 7.3% increase, emphasizing First Keystone's strong growth trajectory in both asset management and income generation.
MWN-AI** Analysis
First Keystone Corporation's recent unaudited fourth quarter earnings for 2025 present a mixed but overall positive picture for investors. The increase in interest income, primarily from commercial real estate loans, highlights the bank's ability to capitalize on lending opportunities despite the broader economic landscape. An 8.2% boost to interest income signals solid growth potential, driven by a strategic focus on higher-yield loan products.
On the expense side, while total interest expense rose slightly by 1.0%, the decrease in short-term borrowing costs suggests prudent management of liabilities. The significant shift of deposits toward retail CDs reflects changing consumer behavior and the bank's adaptive response to market conditions, which can be viewed positively. The increase in deposit interest expenses associated with these CDs, however, should be monitored as it may impact the bank’s net interest margin moving forward.
Notably, non-interest income also rose 9.4%, showcasing diversified revenue streams beyond traditional lending. This is crucial as it mitigates risks associated with potential loan defaults.
A remarkable decrease in non-interest expenses by 32.8%, primarily due to the earlier goodwill impairment, positions First Keystone favorably, enhancing profitability. The sharp increase in net income to $7.6 million versus 2024 can largely be attributed to this factor, making it important for investors to analyze underlying earning quality for sustainability.
With total assets reaching $1.53 billion and a commendable increase in stockholder equity, First Keystone appears fundamentally sound. However, the increase in provision for credit losses due to isolated charge-offs warrants close examination of future loan portfolio performance.
Overall, First Keystone Corporation presents an intriguing investment opportunity, particularly for those seeking exposure to a community-focused bank with a solid growth trajectory. Investors should remain cautious of potential credit risks as the economy continues to evolve.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
First Keystone Corporation (OTC: FKYS), parent company of First Keystone Community Bank, reported an increase in interest income by $5,843,000 or 8.2%, as compared to the year ended December 31, 2024. The increase was predominantly due to growth in commercial real estate loans. Total interest expense increased by $405,000 or 1.0% overall mainly due to an increase of $2,225,000 in interest expense related to deposits offset by a decrease of $1,820,000 in interest expense related to short- and long-term borrowings. Interest on short-term borrowings decreased by $1,731,000 as compared to December 31, 2024 mainly due to lower average balances of short-term borrowings throughout 2025 at $132,726,000 vs. $158,422,000 in 2024. The increased deposit interest for the year ended December 31, 2025 is mainly due to an increase of $3,152,000 in expense related to retail CDs and an increase of $1,226,000 in expense related to brokered CDs offset by a decrease of $2,153,000 in expense related to other retail deposits. Retail CD balances have increased $135,733,000 at December 31, 2025 vs. December 31, 2024, with migration of funds from other retail deposit products into CD products throughout 2025. Average brokered CD balances were $108,398,000 for the year ended December 31, 2025 vs. $77,357,000 for the year ended December 31, 2024. The net effect of derivative agreements increased net interest income by $583,000 for the year ended December 31, 2025 and $1,623,000 for the year ended December 31, 2024. The provision for credit losses increased by $1,273,000 as compared to the year ended December 31, 2024 mainly due to a large charge-off completed during the fourth quarter of 2025 which was isolated and not indicative of any deterioration in the loan portfolio.
Non-interest income increased by $627,000 or 9.4% for the year ended December 31, 2025 as compared to the same period in 2024. Net securities gains/losses improved by $119,000 to a gain of $224,000 compared to a gain of $105,000 for the year ended December 31, 2024 as a result of changes in the mark-to-market adjustment on held equity securities. Other non-interest income increased $372,000 mainly due to $255,000 in gains from life insurance proceeds realized from a death benefit received during the first half of 2025, a $63,000 increase in gains on sales of mortgage loans, and a $33,000 increase in ATM and debit card fee income.
Non-interest expense decreased by $16,678,000 or 32.8% for the year ended December 31, 2025 as compared to the same period in 2024. The decrease from the same period in 2024 was mainly the result of a full, non-cash, goodwill valuation impairment charge of $19,133,000 completed during the first quarter of 2024 from impairment testing performed as a result of the decrease in the Corporation’s stock price as a triggering event. This decrease was offset by a $651,000 increase in salaries and employee benefits mainly driven by increased costs associated with healthcare, a $453,000 increase in data processing fees due to vendor relationship credits utilized in 2024 that were no longer available to utilize in 2025, $307,000 in other non-interest expense related to a fraud write off associated with a customer account in the first quarter of 2025, and a combined $386,000 increase in furniture, equipment and computers expense related to the replacement of the bank’s ATM fleet. Income tax expense increased $645,000 during the year ended December 31, 2025, as compared to the same period in 2024 due to higher overall operating income.
Net income for the year ended December 31, 2025 was $7,622,000. Net income per share was $1.22 while dividends totaled $1.12 per share for the year ended December 31, 2025. Net income increased by $20,825,000 as compared to the same period in 2024. The increase was primarily due to the Corporation recognizing goodwill impairment of $19,133,000 in the first quarter of 2024.
Total Assets increased to $1,532,439,000 at December 31, 2025, an increase of $103,856,000 or 7.3% as compared to December 31, 2024. Securities and restricted stocks increased $4,121,000 as compared to December 31, 2024. Deposits increased by $91,557,000 or 8.8% at December 31, 2025 as compared to December 31, 2024. Retail CDs increased by $135,733,000 and other retail deposits decreased by $44,554,000, as the Corporation has experienced a shift from transactional deposits to term deposits. Stockholders’ equity increased $7,748,000 or 7.3% mainly due to an improvement of $6,177,000 in accumulated other comprehensive loss as a result of market value improvement in the current interest rate environment and a $649,000 increase in retained earnings.
First Keystone Community Bank provides innovative business and personal banking products that focus on “Yesterday’s Traditions. Tomorrow’s Vision.” The Bank currently operates offices in Columbia (5), Luzerne (8), Montour (1), Monroe (4), and Northampton (1) counties.
Inquiries regarding the purchase of the Corporation’s stock may be made through the following brokers: RBC Dain Rauscher, 800-223-4207; Janney Montgomery Scott, Inc., 800-526-6397; and Stifel Nicolaus & Co. Inc., 800-679-5446.
Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. These factors include operating, legal and regulatory risks, changing economic and competitive conditions and other risks and uncertainties.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260130522542/en/
For more information on First Keystone Community Bank or its parent company, First Keystone Corporation, please contact Jack W. Jones at 570-752-3671.
FAQ**
How does the increase in interest income reported by First Keystone Corp. FKYS for 2025 reflect its strategy in commercial real estate lending, and what implications does it have for future growth?
With the decrease in non-interest expenses primarily due to a goodwill impairment at First Keystone Corp. FKYS, how sustainable is this expense reduction, and what should investors expect moving forward?
Given the significant increase in retail CDs at First Keystone Corp. FKYS, how is the bank managing the shift from transactional to term deposits, and what risks does this pose to liquidity?
What are the primary drivers behind the increase in provisions for credit losses at First Keystone Corp. FKYS, and how does the company plan to mitigate potential future impacts on its financial performance?
**MWN-AI FAQ is based on asking OpenAI questions about First Keystone Corp. (OTC: FKYS).
NASDAQ: FKYS
FKYS Trading
0.0% G/L:
$19.50 Last:
400 Volume:
$19.35 Open:
