Company: FSBC
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001628280-25-038796
Chunk: 214

Company: FIVE STAR BANCORP
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 2
Chunk 214
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Non-interest Expense

Non-interest expense includes salaries and employee benefits, occupancy and equipment, data processing and software, FDIC insurance, professional services, advertising and promotional, loan-related expenses, and other operating expenses. In evaluating our level of non-interest expense, we closely monitor the Company’s efficiency ratio, which is calculated as non-interest expense divided by the sum of net interest income and non-interest income. We constantly seek to identify ways to streamline our business and operate more efficiently in order to reduce our non-interest expense over time as a percentage of our revenue, while continuing to achieve growth in total loans and assets.

Over the past several years, we have continued to invest significant resources in personnel, technology, and infrastructure. As we execute initiatives based on growth, we expect non-interest expense to continue to grow. Non-interest expense has increased throughout the periods presented below; however, we expect our efficiency ratio will continue to improve going forward due, in part, to our past investment in infrastructure.

Three months ended June 30, 2025 compared to three months ended June 30, 2024

Table 9 details the components of non-interest expense for the periods indicated.

Table 9: Non-interest ExpenseFor the three months ended(dollars in thousands)June 30, 2025June 30, 2024$ Change% ChangeSalaries and employee benefits$8,910 $7,803 $1,107 14.19 %Occupancy and equipment657 646 11 1.70 %Data processing and software1,508 1,235 273 22.11 %FDIC insurance470 390 80 20.51 %Professional services918 767 151 19.69 %Advertising and promotional865 615 250 40.65 %Loan-related expenses423 297 126 42.42 %Other operating expenses1,975 1,760 215 12.22 %Total non-interest expense$15,726 $13,513 $2,213 16.38 %

Salaries and employee benefits. The increase related primarily to: (i) a $1.2 million increase in salaries, benefits, and bonus expense, mainly related to a 16.58% increase in headcount between June 30, 2024 and June 30, 2025; and (ii) a $0.1 million increase in commissions paid. This increase was partially offset by a $0