Union Bankshares Reports $2.5 Million Net Income in Q1 2025, Driven by Increased Net Interest Income

Union Bankshares, Inc. reported a net income of $2.5 million for the first quarter of 2025, reflecting a 3.5% increase from $2.4 million in the same period of 2024. This growth was primarily driven by a $1.26 million rise in net interest income, which reached $10.27 million, alongside a slight decrease in income tax expenses. However, the bank faced increased noninterest expenses, which rose by $601,000, and a $465,000 increase in credit loss expenses. The bank's total assets stood at $1.52 billion, a marginal decrease from $1.53 billion at the end of 2024, while total loans and loans held for sale increased slightly to $1.17 billion.

In terms of operational metrics, Union Bankshares saw a 1.1% increase in total deposits, which reached $1.18 billion, driven by a $6.5 million rise in noninterest-bearing deposits. The bank's loan portfolio composition remained stable, with real estate loans comprising 87.2% of total loans. The allowance for credit losses on loans increased to $8.11 million from $7.68 million, reflecting management's proactive approach to potential credit risks. The bank's nonperforming assets also rose significantly, with nonaccrual loans increasing to $14.96 million from $1.65 million at the end of 2024.

Strategically, Union Bankshares has focused on enhancing its capital position, with stockholders' equity increasing to $70.1 million, up from $66.5 million at the end of 2024. This improvement was attributed to net income, a reduction in accumulated other comprehensive loss, and an increase in additional paid-in capital. The bank's book value per share rose to $15.44, up from $14.65. The bank continues to explore growth opportunities, including potential acquisitions, while maintaining a conservative approach to its capital management.

Looking ahead, Union Bankshares remains cautious amid a challenging economic environment characterized by rising interest rates and competitive pressures. The bank's management has indicated that while they are confident in their financial model, they are closely monitoring market conditions and customer behavior. The bank's liquidity position is robust, supported by various funding sources, including FHLB advances and brokered deposits, which positions it well to meet future cash flow needs. The bank's strategic focus will continue to be on maintaining asset quality and managing credit risks effectively.