Franklin Financial Services Reports $3.9 Million Net Income in Q1 2025

Franklin Financial Services Corporation reported a net income of $3.9 million for the first quarter of 2025, translating to earnings of $0.88 per diluted share, marking a 16.7% increase from the $3.4 million, or $0.77 per diluted share, recorded in the same period of 2024. The company's total assets rose to $2.257 billion, a 2.7% increase from $2.198 billion at the end of 2024. The growth in net income was supported by a rise in interest income, which reached $27.1 million, up from $23.8 million year-over-year, driven by an increase in loan volume and interest rates.

The corporation's total net loans increased by $57.3 million, or 4.2%, to $1.457 billion, while total deposits grew by $51.9 million, or 2.9%, to $1.868 billion. The cost of deposits slightly decreased to 2.02% from 2.06% in the previous quarter. The provision for credit losses was $779,000, up from $452,000 in the first quarter of 2024, primarily due to the growth in the loan portfolio. The allowance for credit losses as a percentage of loans was 1.27% as of March 31, 2025, compared to 1.26% at the end of 2024.

In terms of operational developments, Franklin Financial's wealth management fees increased to $2.2 million, reflecting growth in assets under management, which surpassed $1.3 billion. The corporation's noninterest income also saw an uptick, totaling $4.6 million, compared to $4.2 million in the prior year. This increase was attributed to higher gains on loan sales and other service charges. The bank's efficiency ratio improved to 71.36%, down from 73.76% a year earlier, indicating better cost management relative to revenue.

The company declared a quarterly cash dividend of $0.33 per share, representing a 3.1% increase over the previous quarter's dividend. This decision reflects the corporation's commitment to returning value to shareholders while maintaining a strong capital position. As of March 31, 2025, total shareholders' equity increased to $151.4 million, up from $144.7 million at the end of 2024, bolstered by retained earnings and improvements in accumulated other comprehensive income.

Looking ahead, Franklin Financial Services Corporation remains optimistic about its growth trajectory, supported by a diverse economic base in its primary market area. Management anticipates continued loan growth and stable asset quality, although it acknowledges potential risks from economic fluctuations and interest rate changes. The corporation's capital ratios indicate a well-capitalized status, positioning it favorably for future opportunities and challenges in the financial landscape.