## Catalyst Bancorp Reports Strong Loan Growth in Q3 2024, Despite Declining Net Income
Catalyst Bancorp, Inc. (Nasdaq: “CLST”), the parent company of Catalyst Bank, announced its financial results for the third quarter of 2024. While the company reported a net income of $447,000, marking a decrease from the previous quarter, it achieved a significant milestone with a record loan portfolio growth of $12.6 million during the period.
Record Loan Portfolio Growth Fuels Business Activity
The company’s loan portfolio reached a total of $165.9 million by September 30, 2024, representing an 8% increase from the second quarter. This growth was driven by strong performance across various loan segments, including commercial real estate, construction and land, and commercial and industrial loans. Notably, the construction and land loan segment saw a remarkable 48% increase, highlighting the company’s active involvement in regional development projects.
Investment Securities and Deposits Show Steady Performance
Catalyst Bancorp also reported a steady increase in its investment securities portfolio, reaching $45.6 million by September 30. This reflects the company’s strategic allocation of funds towards fixed-rate mortgage back securities, indicating a cautious approach to managing risk and maximizing returns.
Total deposits experienced a slight decline to $167.4 million, driven by seasonal fluctuations in public fund deposits. However, the company’s total loans-to-deposits ratio remained strong at 99%, demonstrating its ability to effectively leverage available funds for lending activities.
Capital and Share Repurchases Underscore Commitment to Shareholder Value
Catalyst Bancorp continued its share repurchase program during the third quarter, repurchasing 79,400 shares of its common stock at an average cost per share of $11.75. This demonstrates the company’s commitment to returning value to shareholders and solidifying its financial position.
Net Interest Income Improves, Fueled by Loan Growth
The company’s net interest margin for the third quarter reached 3.86%, representing a 14-basis point increase from the previous quarter. This improvement was attributed to the strong loan growth, which boosted interest income. Despite an increase in interest expense, the company managed to increase its net interest income by $84,000, or 3%, compared to the second quarter.
Non-Interest Income and Expense Reflect Strategic Initiatives
The third quarter saw a significant increase in non-interest income, primarily driven by a $280,000 grant from the Community Development Financial Institution (CDFI) Fund. This grant recognizes the company’s commitment to community development and its positive impact on the region.
Non-interest expense also increased during the quarter, primarily due to salary increases and the initial billing cycle for a new core processing system adopted earlier in the year. These strategic investments reflect the company’s dedication to enhancing its operational efficiency and technological capabilities.
