Company: FGBI
Filing Date: 2025-08-18
Form Type: 10-Q
Source: 0001408534-25-000070
Chunk: 200

Company: First Guaranty Bancshares, Inc.
Filing Date: 2025-08-18
Form: 10-Q
Item: Part I, Item 2
Chunk 200
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 and interest expense incurred on interest-bearing liabilities, including deposits and other borrowed funds. Interest rate fluctuations, as well as changes in the amount and type of interest-earning assets and interest-bearing liabilities, combine to affect net interest income. First Guaranty’s assets and liabilities are generally most affected by changes in the Federal Funds rate, SOFR rate, short term Treasury rates such as one month and three month Treasury bills, and longer term Treasury rates such as the U.S. ten year Treasury rate. Our net interest income is affected by changes in the amount and mix of interest-earning assets and interest-bearing liabilities. There may also be a time lag in the effect of interest rate changes on assets and liabilities. It is also affected by changes in yields earned on interest-earning assets and rates paid on interest-bearing deposits and other borrowed funds.

A financial institution's asset and liability structure is substantially different from that of a non-financial company, in that virtually all assets and liabilities are monetary in nature. Accordingly, changes in interest rates may have a significant impact on a financial institution's performance. The impact of interest rate changes depends on the sensitivity to the change of our interest-earning assets and interest-bearing liabilities. The effects of the changing interest rate environment in recent periods and our interest sensitivity position is discussed below.

Three months ended June 30, 2025 compared to the three months ended June 30, 2024. Net interest income for the three months ended June 30, 2025 and 2024 was $22.2 million and $21.2 million, respectively. The increase in net interest income for the three months ended June 30, 2025 as compared to the prior year period was primarily due to an increase in the average balance of our total interest-earning assets and a decrease in the average rate of our total interest-bearing liabilities, partially offset by a decrease in the average yield of our total interest-earning assets and an increase in the average balance of our total interest-bearing liabilities. For the three months ended June 30, 2025, the average balance of our total interest-earning assets increased by $358.2 million to $3.8 billion due to growth in the securities portfolio and an increase in interest-earning deposits with banks. The average yield of our interest-earning assets decreased by 53 basis points to 5.72% for the three months ended June 30, 2025 from 6.25% for the three months ended June