Company: FSBC
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001628280-25-050090
Chunk: 47

Company: FIVE STAR BANCORP
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 47
---
 such as loans and investments, less interest expense on interest-bearing liabilities, such as deposits, subordinated notes, and other borrowings, which are used to fund those assets. In evaluating our net interest income, we measure and monitor yields on our interest-earning assets and interest-bearing liabilities as well as trends in our net interest margin. Net interest margin is a ratio calculated as net interest income divided by total interest-earning assets for the same period. We manage our earning assets and funding sources in order to maximize this margin while limiting credit risk and interest rate sensitivity to our established risk appetite levels. Changes in market interest rates and competition in our market typically have the largest impact on periodic changes in our net interest margin.

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

Net interest income increased by $9.0 million, or 29.49%, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, and our net interest margin increased 19 basis points during the same period. The increase in net interest income is primarily attributable to an increase in interest income driven by loan growth and an improvement in the average yield on loans, partially offset by an increase in interest expense driven by deposit growth. Additional detail relating to net interest margin in each period is provided below.

36

Average balance sheet, interest, and yield/rate analysis. Table 3 presents average balance sheet information, interest income, interest expense, and the corresponding average yield earned or rate paid for each period reported. The average balances are daily averages and include both performing and nonperforming loans.

Table 3: Average Balances, Interest, and Yield/RateFor the three months endedSeptember 30, 2025For the three months endedSeptember 30, 2024(dollars in thousands)Average BalanceInterest Income/ExpenseAverage Yield/Rate Average BalanceInterest Income/ExpenseAverage Yield/RateAssetsInterest-earning deposits in banks1$451,534 $5,009 4.40 %$126,266 $1,657 5.22 %Investment securities1,296,806 579 2.38 %106,256 620 2.32 %Loans held for investment and sale1,33,831,851 59,257 6.14 %3,354,050 50,390 5.98 %Total interest-earning assets