Peoples Financial Corporation Reports $1.24 Million Net Income in Q2 2025, Down from $2.33 Million Last Year

Peoples Financial Corporation reported a net income of $1.24 million for the second quarter of 2025, a decline from $2.33 million in the same period last year. The decrease in profitability is attributed to a reduction in interest income, which fell to $7.46 million from $8.70 million year-over-year. The company's net interest income also decreased, totaling $5.47 million for the quarter, down from $5.90 million in the prior year. The decline in interest income was primarily driven by lower yields on investments and a decrease in average interest-earning assets, which dropped by approximately $88 million.

Total assets for Peoples Financial Corporation decreased to $761.34 million as of June 30, 2025, down from $831.85 million at the end of 2024. This decline was largely due to a significant drop in total deposits, which fell by $76.42 million, primarily from governmental entities reallocating their funds. The company’s loan portfolio, however, showed growth, increasing to $248.30 million from $233.58 million, as new loans outpaced repayments and charge-offs. The allowance for credit losses on loans was reported at $2.97 million, representing 1.19% of total loans.

In terms of operational metrics, the company maintained a consistent employee headcount, with 4,617,466 shares of common stock issued and outstanding. The bank's focus on maintaining a strong capital base is evident, as it reported a community bank leverage ratio of 13.97%, well above the regulatory minimum of 9%. The company continues to emphasize its commitment to monitoring asset quality and managing non-performing loans, which totaled $600,000 as of June 30, 2025, compared to $418,000 at the end of 2024.

Looking ahead, Peoples Financial Corporation anticipates challenges due to ongoing economic conditions, including inflation and interest rate fluctuations. The Federal Reserve's recent actions to lower interest rates may provide some relief, but the company remains cautious about potential impacts on its loan portfolio and overall financial performance. Management is focused on strategic initiatives to enhance operational efficiency and strengthen its market position in the competitive banking landscape.