Five Star Bancorp reported a significant increase in its financial performance for the fiscal year ending December 31, 2024, with total assets rising to $4.1 billion, up from $3.6 billion in 2023. The company’s total loans held for investment also saw a substantial increase, reaching $3.5 billion, compared to $3.1 billion the previous year. Net interest income increased by 7.96% to $119.7 million, driven by higher average balances and yields on loans, although the net interest margin decreased slightly to 3.32%. The provision for credit losses rose to $7.0 million from $4.0 million, reflecting the company's proactive approach to managing credit risk amid loan growth.
In terms of strategic developments, Five Star Bancorp opened a new full-service branch in Downtown San Francisco in September 2024, marking its expansion into the San Francisco Bay Area. The company also hired several key personnel, including eight business development officers and four relationship managers, to support this growth. As of December 31, 2024, the bank had a total of 205 full-time employees, reflecting its commitment to enhancing service delivery and operational capacity.
Operationally, the bank's customer base and engagement metrics showed positive trends, with total deposits increasing by 17.55% to $3.6 billion. Non-interest-bearing deposits accounted for 25.93% of total deposits, indicating a strong deposit base. The bank's loan-to-deposit ratio improved to 99.38%, down from 102.19% in the previous year, suggesting a more balanced approach to funding and lending. The bank's market share in the Greater Sacramento Area has also grown, confirming its competitive positioning in the region.
Looking ahead, Five Star Bancorp remains focused on organic growth through its "purpose-driven and integrity-centered" banking approach. The company plans to continue expanding its loan portfolio while maintaining disciplined credit underwriting and robust risk management practices. The management anticipates that interest rates may decrease in the coming years, which could positively impact net interest income. However, the bank is also aware of the potential risks associated with economic fluctuations, particularly in the real estate sector, which constitutes a significant portion of its loan portfolio. The company is committed to monitoring these risks closely and adapting its strategies accordingly.
About FIVE STAR BANCORP
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