Company: FCAP
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001171843-25-001868
Chunk: 1156

Company: FIRST CAPITAL INC
Filing Date: 2025-03-31
Form: 10-K
Item: Item 4
Chunk 1156
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 Bank recognized net charge-offs of $469,000 for 2023 compared to $261,000 for 2022.  In addition, nonperforming loans increased from $1.3 million at December 31, 2022 to $1.8 million at December 31, 2023.

Noninterest Income.  Noninterest income decreased $295,000 for 2023 as compared to 2022 primarily due to decreases in gains on the sale of loans and commission and fee income of $412,000 and $370,000, respectively.  These were partially offset by increases in ATM and debit card fees and service charges on deposit accounts of $144,000 and $70,000, respectively, in addition to a decrease of $207,000 in the unrealized loss on equity securities.  In addition, the Company recognized a $40,000 net gain on sale of securities during 2023 compared to no such gain during 2022.

The $40,000 net gain on sale of securities was a result of the Company’s regular evaluation of its entire securities portfolio.  During 2023, the Company selected and sold securities available for sale with a market value of $20.6 million and an amortized cost basis of $20.8 million resulting in a net loss of $114,000.  The net loss was more than offset by the $157,000 gain on sale of the Company’s VISA Class B stock in September 2023.  The strategy for both sales was the enhancement of long-term earnings.

Noninterest Expense.  Noninterest expenses increased $940,000 for 2023 as compared to 2022.  This was primarily due to increases in compensation and benefits, data processing expenses, and other expenses of $305,000, $417,000 and $372,000, respectively, when comparing the two periods.  The increases were partially offset by decreases of $53,000 and $77,000 in professional fees and occupancy and equipment expenses, respectively.  The increase in other expenses was due primarily to increases in FDIC insurance premiums and fraud losses of $203,000 and $163,000, respectively, in addition to general inflationary increases across multiple other expenses.  These were partially offset by a $128,000 decrease in expenses, including the payout of loss claims, associated with the Company’s wholly owned captive insurance subsidiary which ceased regular operations in August and was formally dissolved in December 2023.    

Income Tax Expense.