First US Bancshares Reports Decrease in Net Income Amid Credit Loss Provisions

First US Bancshares, Inc. reported its financial results for the second quarter of 2025, revealing a net income of $155,000, or $0.03 per diluted share, a significant decrease from $2.1 million, or $0.34 per diluted share, in the same period last year. For the first half of 2025, net income totaled $1.9 million, down from $4.2 million in the prior year. The decline in profitability was primarily attributed to a provision for credit losses of $3.2 million, compared to no provision in the same period of 2024. The company’s net interest income increased slightly to $9.5 million for the quarter, up from $9.2 million a year earlier, while total interest income rose to $14.9 million, reflecting growth in interest-earning assets.

Total assets for First US Bancshares increased to $1.14 billion as of June 30, 2025, compared to $1.10 billion at the end of 2024, marking a 3.8% growth. The company’s loan portfolio also expanded by 5.9%, reaching $871.4 million, driven mainly by a $66.4 million increase in consumer indirect loans. However, the company experienced a reduction in other lending categories, particularly in construction and non-residential commercial real estate loans. The allowance for credit losses on loans and leases rose to $11.4 million, representing 1.31% of total loans, up from 1.24% at the end of 2024.

In terms of operational developments, First US Bancshares continues to focus on enhancing its indirect lending platform, which targets higher-end credit consumers. The weighted average credit score for new indirect loans was reported at 798, indicating a strong credit quality in this segment. The company also maintained a stable deposit base, with total deposits increasing to $986.8 million, a 1.5% rise from the previous period, supported by growth in interest-bearing demand deposit accounts and brokered certificates of deposit.

Looking ahead, First US Bancshares remains cautious about the economic environment, which has been characterized by volatility and uncertainty due to factors such as inflation and geopolitical tensions. The company is actively monitoring these conditions, particularly their potential impact on credit quality and loan performance. Management has indicated that while they are focused on maintaining a strong liquidity position and capital ratios, they are also prepared for potential challenges that may arise from changing market conditions.

Overall, First US Bancshares is navigating a complex financial landscape while continuing to pursue growth opportunities, particularly in its consumer lending segments. The company’s strategic focus on enhancing its product offerings and managing credit risk will be critical as it seeks to improve its financial performance in the coming quarters.