result, the Corporation's financial statements for the year ended December 31, 2025, were impacted, necessitating a restatement of certain financial results.
First Keystone Corporation reported a significant turnaround in its financial performance for the fiscal year ending December 31, 2025, achieving a net income of $6.15 million, a stark contrast to a net loss of $13.20 million in the previous year. This improvement was primarily attributed to the absence of a goodwill impairment charge, which had significantly impacted the 2024 results. Earnings per share rose to $0.99 from a loss of $2.14 in 2024, while the return on average assets improved to 0.41% from a negative 0.93%. Total interest income increased by 8.1% to $77.20 million, driven by growth in real estate loans, while interest expense rose modestly by 1.0% to $39.55 million.
The Corporation's total assets grew by 7.2% to approximately $1.53 billion, with total deposits increasing by 8.8% to $1.14 billion. This growth was largely fueled by a $135.73 million increase in retail certificates of deposit, reflecting a strategic shift towards term deposits. The loan portfolio remained stable, with a slight decrease to $946.66 million, primarily due to higher principal payments offsetting new loan originations. The allowance for credit losses increased to $9.41 million, reflecting a proactive approach to managing credit risk amid economic uncertainties.
Operationally, First Keystone Corporation maintained a workforce of 210 employees and continued to expand its branch network, which includes 19 locations across Pennsylvania. The Bank's market share in its primary service area was reported at 2.9%, ranking it 12th among the top 20 banks in the region. The Corporation's strategic focus on enhancing customer relationships and service offerings has been pivotal in attracting and retaining deposits, despite facing competition from various financial institutions.
Looking ahead, the Corporation expressed cautious optimism regarding its future performance, emphasizing the importance of maintaining adequate capital levels and liquidity to navigate potential economic challenges. Management highlighted ongoing efforts to enhance asset quality and mitigate risks associated with interest rate fluctuations. The Corporation's capital ratios remained strong, with a total risk-based capital ratio of 16.12%, well above the regulatory minimum requirements. As the economic landscape evolves, First Keystone Corporation aims to leverage its solid foundation to pursue growth opportunities while managing risks effectively.
About FIRST KEYSTONE CORP
First Keystone Corporation is a bank holding company that manages First Keystone Community Bank, a full-service regional bank serving northeastern Pennsylvania. It offers personal and business banking, loans, trust, and investment services. Focused on community banking, it emphasizes relationship-based service, local market expertise, and regulatory compliance, supporting small to medium-sized businesses and individuals in its primary markets.
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