Arizona Tribune - Sturgis Bancorp, Inc. Reports Financial Results for Third Quarter 2025

Key Quarterly Highlights

• Net income was $2.4 million.

• Earnings per share of $1.09.

• Paid dividend of $0.17 per share.

• Total assets increased to $999 million, with $3.5 million increase in total loans.

• Deposits increased $12.0 million to $894 million.

• Brokered CDs decreased by $30.1 million.

• The Bank maintained strong capital ratios, exceeding "well-capitalized" requirements, with Tier 1 leverage capital at 7.85%.

From Jason J. Hyska, Sturgis Bancorp, Inc. Chief Executive Officer

"Our strategic plan continues to be implemented, focused on Relationship banking and deposit gathering. Core deposits have increased by $128 million, year to date. This increase funded $92.4 million reduction in brokered CDs and borrowings, gradually improving the net interest margin. We will continue to monitor local and national economic factors, as they seem to be ever changing."

Quarterly Income Statement Highlights

• Net income for the quarter (3Q25) was $2.4 million, up from last quarter's (2Q25) $1.6 million net income and up from $1.5 million net income for the same quarter of the prior year (3Q24).

  • The increase in net income from 2Q25 was primarily due to the net effect of the following fluctuations:

    • Revenue increases of $426,000 in net interest income after the provision for credit losses, as a result of increased yield rates and lower cost of funds;

    • An increase in revenue from mortgage banking activities of $152,000; and

    • An overall decrease in other expenses of $211,000.

  • The increase in net income from 3Q24 was primarily due to the net effect of the following:

    • Revenue increase of $1.3 million in net interest income after the provision for credit losses, as a result of increased yield rates and lower cost of funds; and

    • An increase in compensation and benefits expense of $321,000.

• Earnings per share were $1.09 for 3Q25, $0.76 for 2Q25, and $0.72 for 3Q24.

• Net interest income after the provision for credit losses was $8.4 million during 3Q25, a 5.37% increase from 2Q25's $7.9 million. This also is an 18.48% increase from 3Q24's $7.1 million. The change from the same quarter a year ago was primarily due to:

  • An increase in total interest and dividend income of $726,000 due to increased yield rates; and

  • A decrease in total interest expense of $545,000 due to lower cost of funds.

• Tax equivalent net interest margin decreased to 3.54% for 3Q25 from 3.64% for 2Q25, while increasing from the 3.19% margin in 3Q24.

• During 3Q25 and 3Q24, there were reversals of the allowance for credit losses of $62,000 and $28,000, respectively, due to quarterly net recoveries. During 2Q25 $117,000 was provided to the allowance for credit losses.

• Noninterest income totaled $2.4 million during 3Q25, $2.2 million during 2Q25, and $2.4 million during 3Q24.

• Noninterest expenses totaled $7.9 million during 3Q25, $8.1 million during 2Q25, and $7.6 million during 3Q24.

Year-to-Date Income Statement Highlights

• Net income for the first nine months of 2025 (YTD 2025) was $5.4 million compared to $870,000 for the first nine months of 2024 (YTD 2024), as further discussed below.

• Earnings per share were $2.52 for YTD 2025 and $0.40 for YTD 2024.

• Net interest income after the provision for credit losses was $24.2 million for YTD 2025, a 52.38% increase from YTD 2024's $15.9 million. This increase was due to:

  • Total interest and dividend income of $37.0 million for YTD 2025, compared to $34.8 million for YTD 2024, as a result of higher yield rates;

  • Interest expense of $12.9 million for YTD 2025, compared to $14.0 million for YTD 2024 as a result of lower cost of funds; and

  • There has been a reversal of the allowance on credit losses of $104,000 for YTD 2025, while $4.8 million was provided to the allowance in YTD 2024. This difference is primarily due to a one-time charge-off of a single customer's loans totaling $5.5 million which occurred during 1Q24.

• Noninterest income totaled $6.8 million for YTD 2025, compared to $7.7 million for YTD 2024. This is an 11.73% decrease. This net decrease was primarily due to:

  • Mortgage banking activities of $1.2 million in YTD 2025, compared to $1.6 million in YTD 2024;

  • Gain on termination of interest rate swaps of $1.1 million in YTD 2024 with no such gains in YTD 2025; and

  • Offset by investment brokerage commission income of $2.2 million in YTD 2025, compared to $1.9 million in YTD 2024.

• Noninterest expense totaled $24.2 million for YTD 2025, compared to $22.7 million for YTD 2024. This is a 6.74% increase. This increase was due to:

  • Compensation and benefits expense of $14.6 million for YTD 2025, compared to $13.5 million for YTD 2024;

  • Occupancy and equipment expense of $3.4 million for YTD 2025, compared to $3.2 million for YTD 2024; and

  • Data processing expense of $1.1 million for YTD 2025, compared to $900,000 for YTD 2024.

Balance Sheet Highlights

• Total assets increased to $999 million as of the end of 3Q25, a 1.42% increase from the end of 2Q25's $985 million, and a 5.36% increase from the end of 3Q24's $948 million. These increases were primarily comprised of:

  • Cash and cash equivalents ended 3Q25 at $46.0 million, compared to $39.0 million at the end of 2Q25, and $23.8 million at the end of 3Q24.

  • Net loans ended 3Q25 at $781 million, compared to $778 million at the end of 2Q25, and $753 million at the end of 3Q24.

• Total deposits as of the end of 3Q25 were $894 million, compared with $882 million at the end of 2Q25, and $809 million at the end of 3Q24. These increases were comprised of:

  • Noninterest-bearing deposits have remained steady with balances of $163 million, $165 million, and $162 million at the end of 3Q25, 2Q25, and 3Q24, respectively.

  • Interest-bearing deposits increased primarily in checking and reciprocal deposits to $732 million at the end of 3Q25, from $718 million at the end of 2Q25 and from $647 million at the end of 3Q24.

• Borrowed funds ended 3Q25 and 2Q25 at the same balance of $15.7 million, decreasing from the $57.0 million balance at the end of 3Q24.

• Total equity at the end of 3Q25 was $61.3 million, compared to $58.5 million at the end of 2Q25, and $55.5 million at the end of 3Q24.

• Book value per share was $28.29 ($24.15 tangible) at the end of 3Q25, compared to $27.06 ($22.93 tangible) at the end of 2Q25, and $25.74 ($21.55 tangible) at the end of 3Q24.

About Sturgis Bancorp, Inc.

Sturgis Bancorp, Inc. is the holding company for Sturgis Bank & Trust Company (the Bank), and its subsidiaries: Oakleaf Financial Services, Oak Mortgage, Ayres/Oak Insurance, and Oak Title Services. The Bank provides a full array of trust, commercial, and consumer banking services from banking centers in: Sturgis, Bangor, Bronson, Centreville, Climax, Colon, Marshall, Niles, Portage, South Haven, St. Joseph, Three Rivers, and White Pigeon, Michigan. Oakleaf Financial Services offers a complete range of investment and financial-advisory services. Oakleaf Mortgage offers residential mortgages in all markets of the Bank. Ayres/Oak Insurance offers various competitive commercial and consumer insurance products. Oak Title Services offers commercial and consumer title insurance services.

Forward-Looking Statements

This release contains statements that constitute forward-looking statements. These statements appear in several places in this release and include statements regarding intent, belief, outlook, objectives, efforts, estimates, or expectations of Sturgis Bancorp, Inc. (Bancorp), primarily with respect to future events and the future financial performance of Bancorp. Any such forward-looking statements are not guarantees of future events or performance and involve risks and uncertainties, and actual results may differ materially from those in the forward-looking statements. Factors that could cause a difference between an ultimate actual outcome and a preceding forward-looking statement include, but are not limited to, changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking laws and regulations; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; government and regulatory policy changes; the outcome of any pending or future litigation and contingencies; trends in consumer behavior and ability to repay loans; and changes in the world, national, and local economies. Bancorp undertakes no obligation to update, amend, or clarify forward-looking statements as a result of new information, future events, or otherwise. The numbers presented herein are unaudited.

For additional information, visit our website at www.sturgis.bank.

Sturgis Bancorp, Inc. Contacts

• Jason J. Hyska, CEO & President, or Brian P. Hoggatt, CFO - (269) 651-9345

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited - Amounts in thousands, except share and per share data)

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited - Amounts in thousands, except share and per share data)

CONSOLIDATED BALANCE SHEETS
(Unaudited - Amounts in thousands, except share and per share data)

SOURCE: Sturgis Bancorp, Inc.

View the original press release on ACCESS Newswire

M.O.Allen--AT