Company: MCHB
Filing Date: 2025-04-15
Form Type: ARS
Source: 0001518715-25-000069
Chunk: 12

Company: Mechanics Bancorp
Filing Date: 2025-04-15
Form: ARS
Chunk 12
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 have affected our interest income and interest expense, excluding interest income from nonaccrual loans. Information is provided in each category with respect to: (1) changes attributable to changes in volume, (2) changes attributable to changes in rate and (3) the net change. 2024 vs. 2023 Increase (Decrease) Due to Total Change(in thousands) Rate Volume Assets: Interest-earning assets Loans $ 8,032 $ (2,817) $ 5,215 Investment securities (1,983) (8,182) (10,165) FHLB stock, Fed Funds and other 975 6,458 7,433 Total interest-earning assets 7,024 (4,541) 2,483 Liabilities: Deposits Demand deposits 110 (173) (63) Money market and savings 5,731 (7,405) (1,674) Certificates of deposit 25,556 12,513 38,069 Total interest-bearing deposits 31,397 4,935 36,332 Borrowings: Borrowings 1,702 11,320 13,022 Long-term debt 120 22 142 Total interest-bearing liabilities 33,219 16,277 49,496 Total changes in net interest income (loss) $ (26,195) $ (20,818) $ (47,013) Net interest income in 2024 decreased $46.7 million as compared to 2023 due primarily to a decrease in our net interest margin. Our net interest margin decreased from 1.88% in 2023 to 1.38% in 2024 due to a 67 basis point increase in the rates paid on interest-bearing liabilities which was partially offset by a 10 basis point increase in the yield on interest earning assets. Yields on interest-earning assets increased as yields on adjustable-rate loans increased due to increases in the indexes on which their pricing is based. The increase in the rates paid on our interest-bearing liabilities was due to an increase in the proportion of higher cost borrowings and a decrease in the proportion of noninterest-bearing deposits to the total balance of interest-bearing liabilities and higher deposit rates and higher borrowing rates. The increases in the rates paid on borrowings and deposits were due to increases in market interest rates over the prior year and the migration of noninterest-bearing and lower cost interest- bearing accounts to higher cost certificates of deposit and money market accounts. Provision for Credit Losses