Company: MGNO
Filing Date: 2025-01-03
Form Type: 10-Q/A
Source: 0000927089-25-000009
Chunk: 33

Company: Magnolia Bancorp, Inc.
Filing Date: 2025-01-03
Form: 10-Q/A
Chunk 33
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 declines in our cost of funds.

The interest on our certificates of deposit increased to $258,000 in the first nine months of 2024 from $72,000 in the first nine months of 2023. This substantial increase of $186,000 was due to the average rate paid on certificates of deposit increasing to 3.50% in the first nine months of 2024 from 0.86% in the first nine months of 2023, reflecting higher market rates of interest. The higher rate paid in 2024 was partially offset by a $1.3 million or 11.9% decrease in the average balance of certificates of deposit in the first nine months of 2024 from the first nine months of 2023, as we used short-term FHLB advances to a greater extent in the first nine months of 2024. The non-interest-bearing deposits included in our core deposits increased to $1,045,300 at September 30, 2024 from $855,000 at December 31, 2023.

Interest on FHLB advances was $26,000 during the first nine months of 2024 compared to $6,000 in the first nine months of 2023, as the average balance of outstanding FHLB advances was $622,000 in the first nine months of 2024 compared to $503,000 in the first nine months of 2023. We increased our short-term FHLB advances in lieu of paying higher rates on longer term certificates of deposit in anticipation of the Federal Reserve Board cutting interest rates. All of our outstanding FHLB advances were repaid upon maturity prior to September 30, 2024.

Net Interest Income.Net interest income decreased by $232,700, or 22.5%, to $802,300 for the nine months ended September 30, 2024 compared to $1,035,000 for the nine months ended September 30, 2023. The decrease was primarily due to our average interest rate spread declining to 2.45% in the first nine months of 2024 from 3.62% in the first nine months of 2023, as the average rates paid on our deposits and FHLB advances increased substantially faster than the average yield on our loan portfolio. Although the average yield on interest-earning assets increased from 4.11% in the first nine months of 2023 to 4.29% in the first nine months of 202