LIMERICK, PA — Victory Bancorp, Inc. (OTCQX: VTYB) recently released its financial report for the fourth quarter and full year ending December 31, 2023, revealing a robust performance despite a challenging operating environment.
The bank reported a net income of $475 thousand for the fourth quarter, translating to $0.23 per diluted share. For the entire year, the net income was $2.1 million or $1.06 per diluted share. The book value per common share also rose, reaching $14.18 by the end of December 2023.
Joseph W. Major, the bank’s leader, highlighted that total bank assets grew from $419 million at the end of the third quarter to $442 million at the year’s end. This growth occurred despite the sharp increase in funding costs due to unprecedented interest rate hikes, which in turn led to a decline in the net interest margin.
Major credited the bank’s ability to attract valuable clients and expand its loan portfolio to record levels to the dedicated efforts of the team. He noted that the bank’s loan “pipeline” remains strong, with total net loans increasing by 11.3% or $36.9 million during the year, reaching $364.3 million at the end of December 2023. This represents a significant increase compared to $327.4 million at the end of 2022.
Despite the record loan balances, net interest income declined from $15.9 million in 2022 to $13.5 million in 2023, largely due to increased interest expenses. However, the bank’s continued loan growth led to an increase in the allowance for loan loss from $3.3 million at the end of 2022 to $3.5 million at the end of 2023.
Non-performing assets also saw a rise during the quarter, increasing from $0 at the end of September 2023 to $2.2 million at the end of December 2023. These were mainly comprised of two real estate-related credits, which have since been repaid.
Meanwhile, operating expenses remained well managed, with non-interest expenses decreasing slightly from $11.2 million in 2022 to $11.1 million in 2023. The bank’s total negative mark on its available for sale investment portfolio was just below $2 million at the end of 2023.
Despite a challenging year marked by significant increases in funding costs, Victory Bancorp demonstrated resilience and adaptability. The bank’s ability to attract clients and expand its loan portfolio amid rising interest rates paints a promising picture for shareholders as they look ahead to 2024.
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