Norwood Financial Corp Reports 30.3% Increase in Net Income for Q1 2025

Norwood Financial Corp reported a net income of $5.77 million for the first quarter of 2025, a 30.3% increase from $4.43 million in the same period last year. This growth was primarily driven by a $3.15 million rise in net interest income, which reached $18.05 million, compared to $14.91 million in the first quarter of 2024. The company's basic and diluted earnings per share improved to $0.63, up from $0.55 in the prior year. The annualized return on average assets and equity also saw an increase, reaching 1.01% and 10.73%, respectively, compared to 0.80% and 9.79% in the previous year.

Total assets for Norwood Financial Corp increased to $2.38 billion as of March 31, 2025, up from $2.32 billion at the end of 2024. This growth was largely attributed to a $57.6 million increase in gross loans, which totaled $1.75 billion. The company’s loan portfolio saw significant contributions from commercial real estate loans, which rose by $14.3 million, and commercial loans, which increased by $21.5 million. The allowance for credit losses stood at $20.44 million, representing 1.15% of total loans, slightly down from 1.16% at the end of the previous year.

In terms of operational metrics, total deposits rose by $145.3 million to $2.00 billion, driven by increases in interest-bearing demand deposits and certificates of deposit. The company reported a decrease in short-term borrowings, which were eliminated entirely by March 31, 2025, compared to $113.1 million at the end of 2024. Other borrowings increased to $118.6 million, reflecting a shift in funding strategies. The company’s non-performing loans totaled $7.95 million, or 0.45% of total loans, a slight decrease from 0.46% at the end of 2024.

Looking ahead, Norwood Financial Corp remains optimistic about its growth trajectory, citing a strong demand for loans and a stable interest rate environment. The company plans to continue monitoring its credit quality and adjusting its allowance for credit losses as necessary. Management believes that the current economic conditions, including interest rate fluctuations and market competition, will influence its future performance, but they are confident in their strategies to maintain profitability and manage risks effectively.