Company: BCTF
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0001552781-25-000058
Chunk: 290

Company: Bancorp 34, Inc.
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1A
Chunk 290
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 the higher
interest rate environment. This, coupled with market rates peaking during the first nine months of 2024, led to costs on interest bearing
liabilities increasing from 3.08% to 3.74% when comparing 2023 to 2024. Average noninterest bearing deposits were $187.8 million and
$89.2 million for 2024 and 2023, respectively, and this increase reflects the CBOA Merger as previously described.

Average total
borrowings increased to $50.5 million in 2024 as the CBOA Merger resulted in the acquisition of trust preferred security debt and the
Bank carrying Bank Term Funding Program Borrowings (“BTFP”) from the Federal Reserve due to the favorable spread of the borrowings
in relation to cash yields. The BTFP borrowings were paid off using excess cash in the fourth quarter as the Federal Reserve eased in
monetary policy and interest rates declined.

Our net interest margin
was 3.65% for 2024, compared to 2.76% for 2023, an increase of 89 basis points. The increase is a result of the merger improving loan
yield, which outpaced increases in funding costs.

63

The average balance sheet amounts, the related
interest income or expense, and average rates earned or paid are presented in the following table.

    For the year ended December 31, 2024  
    For the year ended December 31, 2023 
  
    (dollars in thousands) 
    Average Balance  
    Interest(2)  
    Average Yield/Rate  
    Average Balance  
    Interest  
    Average Yield/Rate 
  
    Interest Earning Assets 

    Loans(1) 
    $655,802  
    $44,013  
     6.73% 
    $472,113  
    $25,779  
     5.46%
  
    Investment securities 
     68,182  
     2,164  
     2.51% 
     61,694  
     1,611  
     2.61%
  
    Other interest earning assets 
     80,841  
     4,608  
     6.29% 
     16,888  
     734  
     4.35%
  
    Total earning assets 
     804,