First Keystone Announces Amended Fourth Quarter 2025 Earnings (Unaudited)
MWN-AI** Summary
First Keystone Corporation (OTC: FKYS), the parent company of First Keystone Community Bank, announced its amended earnings for the fourth quarter of 2025, revealing significant financial growth compared to the previous year. The corporation reported an 8.1% increase in interest income, totaling $5,777,000, largely driven by growth in commercial real estate loans. Total interest expense saw a slight increase of 1.0%, influenced by rising deposit-related costs despite lower expenses on short- and long-term borrowings.
The increase in interest expense can be attributed to a $3,152,000 outlay on retail certificates of deposits (CDs) and $1,226,000 on brokered CDs. Notably, First Keystone's retail CD balances surged by $135,733,000 as funds shifted from other retail deposit products into CDs. However, interest on short-term borrowings decreased by $1,731,000 due to reduced average borrowing balances year-over-year.
The provision for credit losses rose by $3,061,000, driven by two notable charge-offs and a significant non-accrual commercial real estate loan. Despite this, the overall loan portfolio remained stable. Non-interest income increased by 9.3%, with net securities gains improving due to changes in market valuations.
Operationally, non-interest expenses plummeted by 33.0%, primarily due to a substantial one-time goodwill impairment charge incurred in 2024. This decrease was somewhat offset by increases in employee benefits and various operational costs. Net income surged to $6,152,000, a remarkable increase attributed to the prior year's impairment charge.
Overall, First Keystone's total assets grew to $1,530,977,000, marking a 7.2% increase, while stockholders’ equity improved by 5.9%. The bank's focus on traditional values and innovative banking products continues to resonate, enhancing its market position.
MWN-AI** Analysis
First Keystone Corporation (OTC: FKYS) has released its amended fourth quarter 2025 earnings, which reveal a promising trajectory in interest income and overall financial stability. The reported interest income of $5,777,000 signifies an 8.1% increase year-over-year, largely fueled by growth in commercial real estate loans. This pivotal growth suggests robust demand within this sector, presenting an opportunity for investors interested in real estate sector performance.
Interestingly, while total interest expenses saw a modest increase, the decrease in short-term borrowing interest suggests improved liquidity. The shift from other retail deposit products to retail CDs may reflect a strategic move by consumers towards more secure, interest-bearing options in an uncertain economic environment. The increase in retail CD balances, which rose by $135,733,000, positions First Keystone to benefit from a stable funding base and improved interest margin.
Moreover, First Keystone's ability to increase non-interest income, including gains from life insurance and securities, reflects effective diversified income streams, which diminishes the reliance on traditional banking fees alone. The substantial decrease in non-interest expenses by 33% largely stemmed from a one-time goodwill impairment in 2024, indicating operational efficiency improvements.
The net income of $6,152,000 for 2025 represents a remarkable turnaround from the prior year, particularly noteworthy as it follows a year of significant impairment challenges. With net income per share of $0.99 and a generous dividend payout of $1.12, shareholders may find the current valuation attractive.
Given these results, potential investors might consider First Keystone as a viable option for dividend-seeking portfolios, especially in a rising interest environment, while keeping an eye on the potential impact of economic shifts on commercial real estate. Investors should also monitor the company’s handling of credit losses to gauge ongoing portfolio risk.
**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 $5,777,000 or 8.1%, 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 $3,061,000 as compared to the year ended December 31, 2024 mainly due to two larger charge-offs and the movement to non-accrual of a significant commercial real estate loan completed during the fourth quarter of 2025. The circumstances related to each respective loan were isolated and not indicative of any deterioration in the loan portfolio.
Non-interest income increased by $626,000 or 9.3% 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 $371,000 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 $16,670,000 or 33.0% 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 $252,000 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 $6,152,000. Net income per share was $0.99 while dividends totaled $1.12 per share for the year ended December 31, 2025. Net income increased by $19,355,000 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 $1,530,977,000 at December 31, 2025, an increase of $102,394,000 or 7.2% 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 $6,278,000 or 5.9% 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.
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/20260330029072/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 commercial real estate loans contribute to the overall growth in interest income for First Keystone Corp. FKYS, and what are the future prospects for this segment?
Given the significant decrease in non-interest expense for First Keystone Corp. FKYS due to the prior goodwill impairment charge, how might future expenses be impacted in subsequent years?
Considering the increase in net income for First Keystone Corp. FKYS, how sustainable do you believe this growth is, especially after accounting for the one-time goodwill impairment?
What strategies is First Keystone Corp. FKYS implementing to manage the shift from transactional deposits to term deposits like retail CDs, and how might this affect liquidity?
**MWN-AI FAQ is based on asking OpenAI questions about First Keystone Corp. (OTC: FKYS).
NASDAQ: FKYS
FKYS Trading
1.33% G/L:
$19 Last:
188 Volume:
$19 Open:
