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  Title	OptimumBank Holdings, Inc. Financial Performance for the Fourth Quarter of 2024
  ID	6584898
  External ID	7525576569
  Author	Unknown
  Published Date	Feb. 5, 2025, 8:30 a.m.
  Summary	By: February 05, 2025 at 08:30 AM EST Fort Lauderdale, Florida--(Newsfile Corp. - February 5, 2025) - OptimumBank Holdings, Inc. (NYSE American: OPHC) (the "Company") is a one-bank holding company a
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  URL	http://business.inyoregister.com/inyoregister/article/newsfile-2025-2-5-optimumbank-holdings-inc-financial-performance-for-the-fourth-quarter-of-2024
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  Content ID	4079463
  Key	04d565e6-d765-4e49-ae16-51e7c14856bc
  Content	By: February 05, 2025 at 08:30 AM EST Fort Lauderdale, Florida--(Newsfile Corp. - February 5, 2025) - OptimumBank Holdings, Inc. (NYSE American: OPHC) (the "Company") is a one-bank holding company and owns 100% of OptimumBank (the "Bank"). Today the Company reported robust financial performance for the year ended, December 31, 2024. The Company achieved net income of $13.1 million, or $1.39 per basic share and $1.33 per diluted share, compared to net income of $6.3 million, or $0.87 per basic and diluted share, for the same period in 2023. This reflects significant growth in both revenue and profitability year-over-year, driven by strong increases in net interest income and noninterest income. Key Financial Highlights: Net interest income for the year ended December 31, 2024, reached $34.7 million, reflecting a robust 46.3% increase from $23.7 million for the same period in 2023. This growth was primarily driven by a 43.1% rise in average interest-earning assets, alongside a slight improvement in net interest margin. Net interest margin increased to 3.83%, up from 3.75% for the year ended December 31, 2023, reflecting effective asset utilization despite the upward pressures on funding costs associated with interest-bearing deposits. Noninterest income for the year ended December 31, 2024, grew to $4.6 million, a 33.9% increase from $3.5 million in 2023, driven primarily by higher service charges and a solid increase in other noninterest income sources. Asset and Deposit Growth: Gross loans expanded to $804.0 million as of December 31, 2024, reflecting an 18.2% increase from $680.1 million as of December 31, 2023, driven by sustained demand across our lending products. Total deposits grew by 20.7% to $772.2 million, from $639.5 million as of December 31, 2023. Capital Position: The Bank's Tier 1 capital to total assets ratio improved to 10.91% as of December 31, 2024, compared to 10.00% at the end of 2023, reflecting a strengthened capital base that supports continued growth. Chairman of the Board Commentary "We are pleased to report strong financial results for the year ended December 31, 2024, underscoring the effectiveness of our strategic initiatives and operational execution. Net income for the period increased to $13.1 million, or $1.39 per basic share and $1.33 per diluted share, a significant improvement from $6.3 million in the prior year. This remarkable growth is a testament to our commitment to generating superior returns for shareholders while enhancing our operational efficiencies and market positioning." "Our net interest income demonstrated robust growth, rising 46.3% to $34.7 million, driven primarily by a 43.1% increase in average interest-earning assets. The enhancement in our net interest margin—up 8 basis points to 3.83% from 3.75% year over year-reflects our effective management of asset yields despite the upward pressures on funding costs associated with interest—bearing deposits." "Noninterest income also showed strong growth, increasing 33.9% to $4.6 million from $3.5 million last year. This growth was primarily driven by higher service charges and a solid uptick in other noninterest income sources, reflecting the increasing diversification of our revenue base. Concurrently, we experienced a 32.7% rise in noninterest expenses to $19.5 million, mainly due to strategic investments in talent, technology, and infrastructure. These investments—focused on scaling our SBA department and enhancing treasury management capabilities—are expected to generate long-term revenue accretion, positioning us for the future." "From an asset perspective, our gross loans expanded to $804 million, reflecting an 18.2% increase from $680.1 million in 2023, driven by sustained demand across our lending products. Our deposit base grew by 20.7% to $772.2 million, with noninterest-bearing deposits increasing by 8.7%. This balanced growth in both loan and deposit portfolios reflect our continued ability to attract and retain high-quality relationships." "Looking forward, we remain confident in our ability to capitalize on the current momentum, with a strategic focus on disciplined lending, expense optimization, and innovative product offerings. Earlier this year, we successfully completed an At-the-Market offering of common stock, raising more than $10 million to further strengthen our capital position. We are committed to leveraging our capital, operational efficiency, and market position to continue driving superior returns for our shareholders and stakeholders alike." Net Interest Income and Net Interest Margin Year Ended (Dollars in thousands) Net interest income for the year ended 2024 was $34.69 million, reflecting a 46.3% increase from $23.71 million in 2023. This growth was primarily driven by a 43.1% increase in average interest-earning assets from the prior year, contributing significantly to the rise in net interest income. The net interest margin improved to 3.83% from 3.75%, up by eight basis points, demonstrating effective asset utilization and growth despite increased interest-bearing deposit costs. Noninterest Income Year Ended December 31 (Dollars in thousands) Noninterest income for the year ended 2024 was $4.623 million, a 33.9% increase from $3.45 million in year ended 2023. The increase was primarily driven by higher service charges and fees, which rose to $3.78 million from $3.33 million in 2023. Additionally, there was a significant increase in other noninterest income, which includes loan prepayments, which grew to $843,000 from $123,000 in 2023. Noninterest Expense Year Ended December 31 (Dollars in thousands) Noninterest expenses for the year ended December 31, 2024, totaled $19.46 million, a 32.7% increase from $14.66 million in 2023. This increase reflects strategic investments to support the Company's expansion and operational growth. A significant portion of the increase was driven by salaries and employee benefits, which rose to $11.10 million from $8.26 million, reflecting the bank's commitment to strengthening its workforce to support expanding service offerings. Data processing expenses grew from $1.70 million to $2.27 million, due to investments in advanced treasury management software. This technology enhances our ability to serve current clients and attract new business, generating additional fee income as we expand our treasury management capabilities. Further contributing to the rise in expenses were regulatory assessments, which increased from $550,000 to $799,000, and professional fees, which rose to $1.07 million from $729,000. These increases reflect heightened compliance efforts, and the specialized expertise required to scale our services. Additionally, occupancy and equipment expenses increased from $773,000 to $884,000, while other noninterest expenses rose from $2.27 million to $3.33 million. These investments in talent, technology, and compliance are part of our long-term strategy to position the Company for sustainable growth, allowing us to serve a broader client base while advancing past our goal of becoming a $1 billion institution. Loans and Credit Quality (Dollars in thousands) Change in Allowance for Credit Losses (Dollars in thousands) Year Ended December 31 (Dollars in thousands) As of December 31, 2024, gross loans reached $804.2 million, a significant increase of 18.2% from $680.1 million at the end of December 2023. After accounting for net deferred loan fees and costs, which decreased by 54.0% to $(595,000), and an increase of 12.7% in the allowance for credit losses, total net loans amounted to $795.0 million, reflecting an 18.5% rise from $671.1 million at the close of 2023. The allowance for credit losses at the end of December 2024 stands at $8.66 million, up 12.7% from $7.68 million as of December 31, 2023. This increase reflects a combination of credit loss expense adjustments and recoveries across different loan categories. The breakdown of the allowance for credit losses reveals the following key changes for the year ended December 31, 2024: Residential Real Estate: Increased to $1.11 million from $1.02 million, reflecting additional allowances following a credit loss expense of $94,000. Multi-Family Real Estate: Decreased to $786,000 from $1.04 million, primarily due to a $(255,000) credit recovery. Commercial Real Estate: Declined to $2.71 million from $3.79 million, driven by a $(1.09) million credit recovery. Land and Construction: Increased to $2.02 million from $1.02 million, reflecting a credit loss expense of $996,000. Commercial Loans: Increased to $1.68 million from $281,000, after a credit loss expense of $1.41 million and charge-offs of $17,000. Consumer Loans: Declined to $365,000 from $529,000, as charge-offs of $1.76 million were partially offset by recoveries of $382,000 and a credit loss expense of $1.21 million. As of December 31, 2024, the allowance for credit losses stands at 1.08% of total loans and covers 115% of nonperforming loans, which totaled $7.5 million. This strong coverage underscores the Company's commitment to prudent risk management and credit quality oversight, ensuring it remains well-positioned to manage potential risks as it continues its strong growth trajectory. Deposits Deposits Summary Consolidated Balance Sheets (Dollars in thousands) Deposits Summary Year Ended December 31 (Dollars in thousands) Interest Rates on Deposits (Dollars in thousands) Deposit Composition (Percentage of Total Deposits) Total deposits reached $772.2 million as of December 31, 2024, reflecting a 20.7% increase from $639.6 million on December 31, 2023. This growth was driven by an 8.7% increase in noninterest-bearing demand deposits, which rose to $211.9 million from $194.9 million. However, savings, NOW, and money-market deposits declined 13.8% to $278.4 million, compared to $322.9 million at the end of the previous year. The net increase in deposits for the year totaled $132.6 million, slightly above the $131.7 million increase recorded in 2023. Uninsured deposits accounted for 27.6% of total deposits as of December 31, 2024, down from 28.9% at the end of 2023, while noninterest deposits made up 27.4%, compared to 30.5% in the prior year. Capital Requirements to be Well Capitalized (Dollars in thousands) As of December 31, 2024, the Bank's Tier 1 capital totaled $107.1 million, representing a Tier 1 capital to total assets ratio of 10.91% This marks an increase from $75.0 million and a ratio of 10.00% as of December 31, 2023. Tier 1 capital is more than $18.7 million dollars greater than is required to meet the CBLR Framework. Safe Harbor Statement This press release contains forward-looking statements that can be identified by terminology such as "believes," "expects," "potential," "plans," "suggests," "may," "should," "could," "intends," or similar expressions. Many forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to be materially different from any future results or implied by such statements. These factors include, but are not limited to, our limited operating history, managing our expected growth, risks associated with the integration of acquired websites, possible inadvertent infringement of third-party intellectual property rights, our ability to effectively compete, our acquisition strategy, and a limited public market for our common stock, among other risks. OptimumBank Holdings, Inc.'s future results may also be impacted by other risk factors listed from time to time in its SEC filings. Many factors are difficult to predict accurately and are generally beyond the company's control. Forward-looking statements speak only as to the date they are made, and OptimumBank Holdings, Inc. does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made. Investor Relations & Corporate Relations Contact: Seth Denison Telephone: Email: SDenison@OptimumBank.com Select Financial Data Consolidated Balance Sheets (Dollars in thousands, except per share amounts) Consolidated Statements of Earnings (In thousands, except per share amounts) Consolidated Statements of Comprehensive Income (In thousands) To view the source version of this press release, please visit https://www.newsfilecorp.com/release/239642
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  Publisher Name	The Inyo Register
  Publisher URL	http://business.inyoregister.com
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