Morris State Bancshares Announces Strong Quarterly Earnings and Declares Fourth Quarter Dividend
DUBLIN, Ga., Oct. 31, 2025 (GLOBE NEWSWIRE) — Morris State Bancshares, Inc. (OTCQX: MBLU) (the “Company”), the parent of Morris Bank (the “Bank”), today announced net income of $9.2 million for the quarter ending September 30, 2025, representing an increase of $3.2 million, or 53.43%, compared to net income of $5.9 million for the quarter ended June 30, 2025. Year-over-year the Company’s net income increased $3.7 million, or 68.98%, compared to net income of $5.4 million for the quarter ended September 30, 2024. The Bank’s record quarterly net earnings were primarily driven by two non-recurring items, one that increased non-interest income and another, an accounting change, that reduced non-interest expenses.
“We had a very strong third quarter. Core earnings continued to grow steadily this quarter, supported by higher net interest income as our net interest margin (NIM) increased 5 basis points (bp) to 4.48%. Additionally, we had a couple of one-time items that enhanced both our non-interest income and non-interest expense levels, producing the highest quarterly income in the Bank’s history. The Bank received the COVID Employee Retention Credit (ERC) of just under $2.5 million in July as a result of eligible payroll expenses incurred during the pandemic under the federal relief program. We also retroactively adopted FASB’s Proportional Amortization Method (PAM) as it relates to the Bank’s investment tax credits at the beginning of the year. Due to the adoption of PAM, we recorded a reduction to equity and a corresponding increase in accumulated amortization of investment tax credits. However, this retroactive adoption of PAM reduced our current year amortization expense, which resulted in the reversal of $1.7 million in amortization expenses during the third quarter. So combined, the ERC and PAM adoption boosted pre-tax income by $4.2 million and increased overall net income by $3.2 million from the prior quarter,” said Spence Mullis, Chairman and CEO. “Again, even without these one-time items, our net interest income grew due to our NIM expanding as a result of solid loan growth. Future earnings will also be enhanced by reduced amortization expense with the shift to PAM.”
The net interest margin was 4.48% for the third quarter of 2025 compared to 4.43% for the second quarter of 2025 and 4.10% for the third quarter of 2024. The average yield on earning assets grew three basis points from 6.20%, as of June 30, 2025, to 6.23%, while the Bank’s cost of funds decreased two basis points from 1.98% to 1.96% during the same period.
Total deposits declined slightly during the quarter by $5.5 million, or 0.42%. Loans increased $18.2 million during the third quarter. Management expects loan demand to remain largely unchanged for the remainder of the year, with the potential for a slight increase resulting from recent M&A activity by other banks in its markets.
The Bank’s allowance for credit losses as a percentage of total loans was 1.27% for September 30, 2025, as compared to 1.28% for June 30, 2025, and 1.30% as of September 30, 2024. The Company’s adversely classified index reduced slightly from 9.51% as of June 30, 2025, to 9.39% as of September 30, 2025. The Bank’s efficiency ratio improved significantly from 50.97% as of June 30, 2025, to 36.96% as of September 30, 2025, because of the previously mentioned additional income from the ERC and PAM amortization accounting adjustment.
The Company’s total shareholders’ equity increased 2.27% to $207.5 million as of September 30, 2025, as compared to $202.9 million as of June 30, 2025. Tangible book value per share increased to $18.51 as of September 30, 2025, a 2.49% increase from $18.06 per share on June 30, 2025. On October 15, 2025, the board of directors approved its fourth quarter dividend of $0.12 per share payable on or about December 10th to all shareholders of record as of November 10th.
Forward-looking Statements
Certain statements contained in this release may not be based on historical facts and are forward-looking statements. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “may,” “might,” “will,” “would,” “could” or “intend.” We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including, among others, the business and economic conditions; risks related to the integration of acquired businesses and any future acquisitions; changes in management personnel; interest rate risk; ability to execute on planned expansion and organic growth; credit risk and concentrations associated with the Company’s loan portfolio; asset quality and loan charge-offs; inaccuracy of the assumptions and estimates management of the Company makes in establishing reserves for probable loan losses and other estimates; lack of liquidity; impairment of investment securities, goodwill or other intangible assets; the Company’s risk management strategies; increased competition; system failures or failures to prevent breaches of our network security; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes; and increases in capital requirements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.
CONTACT:
Morris State Bancshares
Chris Bond
Chief Financial Officer
478-272-5202
| MORRIS STATE BANCSHARES, INC. AND SUBSIDIARIES Consolidating Balance Sheet | |||||||||||||||||||||||||
| September 30, 2025 | June 30, 2025 | Change | % Change | September 30, 2024 | Change | % Change | |||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||
| Cash and due from banks | $ | 84,825,539 | $ | 106,289,134 | $ | (21,463,595 | ) | -20.19 | % | $ | 48,180,615 | $ | 36,644,924 | 76.06 | % | ||||||||||
| Federal funds sold | 15,499,910 | 24,863,860 | (9,363,950 | ) | -37.66 | % | 11,932,122 | 3,567,788 | 29.90 | % | |||||||||||||||
| Total cash and cash equivalents | 100,325,449 | 131,152,994 | (30,827,545 | ) | -23.51 | % | 60,112,737 | 40,212,712 | 66.90 | % | |||||||||||||||
| Interest-bearing time deposits in other banks | 100,000 | 100,000 | — | 0.00 | % | 100,000 | — | 0.00 | % | ||||||||||||||||
| Securities available for sale, at fair value | 22,248,768 | 9,805,608 | 12,443,160 | 126.90 | % | 6,299,609 | 15,949,159 | 0.00 | % | ||||||||||||||||
| Securities held to maturity, at cost (net of CECL Reserve) | 191,253,253 | 205,814,736 | (14,561,483 | ) | -7.08 | % | 224,532,603 | (33,279,350 | ) | -14.82 | % | ||||||||||||||
| Federal Home Loan Bank stock, restricted, at cost | 1,084,200 | 1,084,200 | — | 0.00 | % | 1,740,300 | (656,100 | ) | -37.70 | % | |||||||||||||||
| Loans, net of unearned income | 1,174,036,110 | 1,155,735,771 | 18,300,339 | 1.58 | % | 1,088,132,851 | 85,903,259 | 7.89 | % | ||||||||||||||||
| Less-allowance for credit losses | (14,959,466 | ) | (14,816,647 | ) | (142,819 | ) | 0.96 | % | (14,179,392 | ) | (780,074 | ) | 5.50 | % | |||||||||||
| Loans, net | 1,159,076,644 | 1,140,919,124 | 18,157,520 | 1.59 | % | 1,073,953,459 | 85,123,185 | 7.93 | % | ||||||||||||||||
| – | |||||||||||||||||||||||||
| Bank premises and equipment, net | 14,698,463 | 14,720,155 | (21,692 | ) | -0.15 | % | 12,912,111 | 1,786,352 | 13.83 | % | |||||||||||||||
| ROU assets for operating lease, net | 660,649 | 601,700 | 58,949 | 9.80 | % | 854,808 | (194,159 | ) | -22.71 | % | |||||||||||||||
| Goodwill | 9,361,704 | 9,361,704 | — | 0.00 | % | 9,361,704 | — | 0.00 | % | ||||||||||||||||
| Intangible assets, net | 1,085,256 | 1,167,611 | (82,355 | ) | -7.05 | % | 1,422,326 | (337,070 | ) | -23.70 | % | ||||||||||||||
| Other real estate and foreclosed assets | 5,700 | 3,300 | 2,400 | 72.73 | % | 39,755 | (34,055 | ) | -85.66 | % | |||||||||||||||
| Accrued interest receivable | 7,388,887 | 6,760,207 | 628,680 | 9.30 | % | 6,640,617 | 748,270 | 11.27 | % | ||||||||||||||||
| Cash surrender value of life insurance | 15,450,301 | 15,340,444 | 109,857 | 0.72 | % | 15,022,374 | 427,927 | 2.85 | % | ||||||||||||||||
| Other assets | 17,652,382 | 17,574,139 | 78,243 | 0.45 | % | 22,311,520 | (4,659,138 | ) | -20.88 | % | |||||||||||||||
| Total Assets | $ | 1,540,391,656 | $ | 1,554,405,922 | $ | (14,014,266 | ) | -0.90 | % | $ | 1,435,303,923 | 105,087,733 | 7.32 | % | |||||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||
| Deposits: | |||||||||||||||||||||||||
| Non-interest bearing | $ | 335,465,880 | $ | 346,323,393 | $ | (10,857,513 | ) | -3.14 | % | $ | 320,503,732 | 14,962,148 | 4.67 | % | |||||||||||
| Interest bearing | 978,169,036 | 972,826,660 | 5,342,376 | 0.55 | % | 876,274,737 | 101,894,299 | 11.63 | % | ||||||||||||||||
| 1,313,634,916 | 1,319,150,053 | (5,515,137 | ) | -0.42 | % | 1,196,778,469 | 116,856,447 | 9.76 | % | ||||||||||||||||
| – | |||||||||||||||||||||||||
| Other borrowed funds | 4,124,000 | 19,039,839 | (14,915,839 | ) | -78.34 | % | 34,009,138 | (29,885,138 | ) | -87.87 | % | ||||||||||||||
| Lease liability for operating lease | 660,649 | 601,700 | 58,949 | 9.80 | % | 854,808 | (194,159 | ) | -22.71 | % | |||||||||||||||
| Accrued interest payable | 2,941,286 | 3,331,983 | (390,697 | ) | -11.73 | % | 2,114,956 | 826,330 | 39.07 | % | |||||||||||||||
| Accrued expenses and other liabilities | 11,494,708 | 9,362,044 | 2,132,664 | 22.78 | % | 10,938,057 | 556,651 | 5.09 | % | ||||||||||||||||
| Total liabilities | 1,332,855,559 | 1,351,485,619 | (18,630,060 | ) | -1.38 | % | 1,244,695,428 | 88,160,131 | 7.08 | % | |||||||||||||||
| Shareholders’ Equity: | |||||||||||||||||||||||||
| Common stock | 10,754,034 | 10,754,034 | — | 0.00 | % | 10,688,223 | 65,811 | 0.62 | % | ||||||||||||||||
| Paid in capital surplus | 36,029,228 | 35,876,904 | 152,324 | 0.42 | % | 34,867,691 | 1,161,537 | 3.33 | % | ||||||||||||||||
| Retained earnings | 143,109,304 | 147,779,527 | (4,670,223 | ) | -3.16 | % | 131,085,914 | 12,023,390 | 9.17 | % | |||||||||||||||
| Current year earnings | 20,116,252 | 10,912,007 | 9,204,245 | 84.35 | % | 15,660,043 | 4,456,209 | 28.46 | % | ||||||||||||||||
| Accumulated other comprehensive income (loss) | 1,083,287 | 1,153,839 | (70,552 | ) | -6.11 | % | 1,582,952 | (499,665 | ) | -31.57 | % | ||||||||||||||
| Treasury Stock, at cost 103,922 | (3,556,008 | ) | (3,556,008 | ) | — | 0.00 | % | (3,276,328 | ) | (279,680 | ) | 8.54 | % | ||||||||||||
| Total shareholders’ equity | 207,536,097 | 202,920,303 | 4,615,794 | 2.27 | % | 190,608,495 | 16,927,602 | 8.88 | % | ||||||||||||||||
| Total Liabilities and Shareholders’ Equity | $ | 1,540,391,656 | $ | 1,554,405,922 | (14,014,266 | ) | -0.90 | % | $ | 1,435,303,923 | 105,087,733 | 7.32 | % | ||||||||||||
| MORRIS STATE BANCSHARES, INC. | |||||||||||||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||||||||||||
| Consolidating Statement of Income | |||||||||||||||||||||||||
| for the Three Months Ended | |||||||||||||||||||||||||
| September 30, | June 30, | September 30, | |||||||||||||||||||||||
| 2025 | 2025 | Change | % Change | 2024 | Change | % Change | |||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||||||||||
| Interest and Dividend Income: | |||||||||||||||||||||||||
| Interest and fees on loans | $ | 20,986,965 | $ | 20,414,871 | $ | 572,094 | 2.80 | % | $ | 18,630,690 | $ | 2,356,275 | 12.65 | % | |||||||||||
| Interest income on securities | 1,600,983 | 1,568,867 | 32,116 | 2.05 | % | 1,825,236 | (224,253 | ) | -12.29 | % | |||||||||||||||
| Income on federal funds sold | 156,033 | 201,101 | (45,068 | ) | -22.41 | % | 163,624 | (7,591 | ) | -4.64 | % | ||||||||||||||
| Income on time deposits held in other banks | 1,034,737 | 850,388 | 184,349 | 21.68 | % | 338,433 | 696,304 | 205.74 | % | ||||||||||||||||
| Other interest and dividend income | 19,768 | 19,576 | 192 | 0.98 | % | 21,031 | (1,263 | ) | -6.01 | % | |||||||||||||||
| Total interest and dividend income | 23,798,486 | 23,054,803 | 743,683 | 3.23 | % | 20,979,014 | 2,819,472 | 13.44 | % | ||||||||||||||||
| Interest Expense: | |||||||||||||||||||||||||
| Deposits | 6,634,933 | 6,545,646 | 89,287 | 1.36 | % | 6,671,982 | (37,049 | ) | -0.56 | % | |||||||||||||||
| Interest on other borrowed funds | 208,252 | 289,514 | (81,262 | ) | -28.07 | % | 309,265 | (101,013 | ) | -32.66 | % | ||||||||||||||
| Interest on federal funds purchased | — | — | — | — | — | — | 0.00 | % | |||||||||||||||||
| Total interest expense | 6,843,185 | 6,835,160 | 8,025 | 0.12 | % | 6,981,247 | (138,062 | ) | -1.98 | % | |||||||||||||||
| Net interest income before provision for loan losses | 16,955,301 | 16,219,643 | 735,658 | 4.54 | % | 13,997,767 | 2,957,534 | 21.13 | % | ||||||||||||||||
| Less-provision for credit losses | 1,133,932 | 439,040 | 694,892 | 158.28 | % | 252,021 | 881,911 | 349.94 | % | ||||||||||||||||
| Net interest income after provision for credit losses | 15,821,369 | 15,780,603 | 40,766 | 0.26 | % | 13,745,746 | 2,075,623 | 15.10 | % | ||||||||||||||||
| Noninterest Income: | |||||||||||||||||||||||||
| Service charges on deposit accounts | 618,127 | 546,848 | 71,279 | 13.03 | % | 576,751 | 41,376 | 7.17 | % | ||||||||||||||||
| Other service charges, commissions and fees | 372,841 | 384,400 | (11,559 | ) | -3.01 | % | 399,839 | (26,998 | ) | -6.75 | % | ||||||||||||||
| Gain on sales of foreclosed assets | — | — | — | — | — | — | 0.00 | % | |||||||||||||||||
| Gain on sales of premises and equipment | — | — | — | — | — | — | 0.00 | % | |||||||||||||||||
| Increase in CSV of life insurance | 109,856 | 106,932 | 2,924 | 2.73 | % | 106,407 | 3,449 | 3.24 | % | ||||||||||||||||
| Other income | 2,865,191 | 332,498 | 2,532,693 | 761.72 | % | 23,002 | 2,842,189 | 12356.27 | % | ||||||||||||||||
| Total noninterest income | 3,966,015 | 1,370,678 | 2,595,337 | 189.35 | % | 1,105,999 | 2,860,016 | 258.59 | % | ||||||||||||||||
| Noninterest Expense: | |||||||||||||||||||||||||
| Salaries and employee benefits | 5,024,507 | 4,951,680 | 72,827 | 1.47 | % | 4,794,940 | 229,567 | 4.79 | % | ||||||||||||||||
| Occupancy and equipment expenses, net | 566,265 | 609,642 | (43,377 | ) | -7.12 | % | 592,165 | (25,900 | ) | -4.37 | % | ||||||||||||||
| Loss on sales and calls of securities | — | — | — | — | — | — | 0.00 | % | |||||||||||||||||
| Loss on Sales of premises and equipment | — | — | — | — | — | — | 0.00 | % | |||||||||||||||||
| Loss on sales of foreclosed assets | — | 1,400 | (1,400 | ) | -100.00 | % | 2,065 | (2,065 | ) | 0.00 | % | ||||||||||||||
| Other expenses | 2,065,393 | 3,706,152 | (1,640,759 | ) | -44.27 | % | 3,752,517 | (1,687,124 | ) | -44.96 | % | ||||||||||||||
| Total noninterest expense | 7,656,165 | 9,268,874 | (1,612,709 | ) | -17.40 | % | 9,141,687 | (1,485,522 | ) | -16.25 | % | ||||||||||||||
| Income Before Income Taxes | 12,131,219 | 7,882,407 | 4,248,812 | 53.90 | % | 5,710,058 | 6,421,161 | 112.45 | % | ||||||||||||||||
| Provision for income taxes | 2,926,975 | 1,883,456 | 1,043,519 | -55.40 | % | 263,212 | 2,663,763 | 1012.02 | % | ||||||||||||||||
| Net Income | $ | 9,204,244 | $ | 5,998,951 | 3,205,293 | 53.43 | % | $ | 5,446,846 | 3,757,398 | 68.98 | % | |||||||||||||
| Earnings per common share: | |||||||||||||||||||||||||
| Basic | $ | 0.87 | $ | 0.57 | 0.30 | 52.01 | % | $ | 0.51 | 0.36 | 69.90 | % | |||||||||||||
| Diluted | $ | 0.87 | $ | 0.57 | 0.30 | 52.63 | % | $ | 0.51 | 0.36 | 70.59 | % | |||||||||||||
| Quarter Ending | |||||||||
| September 30, | June 30, | September 30, | |||||||
| 2025 | 2025 | 2024 | |||||||
| Dollars in thousand, except per share data | (Unaudited) | (Unaudited) | (Unaudited) | ||||||
| Per Share Data | |||||||||
| Basic Earnings per Common Share | $ | 0.87 | $ | 0.57 | $ | 0.51 | |||
| Diluted Earnings per Common Share | 0.87 | 0.57 | 0.51 | ||||||
| Dividends per Common Share | 0.12 | 0.12 | 0.092 | ||||||
| Book Value per Common Share | 19.49 | 19.05 | 17.99 | ||||||
| Tangible Book Value per Common Share | 18.51 | 18.06 | 16.97 | ||||||
| Average Diluted Shares Outstanding | 10,622,703 | 10,608,771 | 10,602,348 | ||||||
| End of Period Common Shares Outstanding | 10,650,112 | 10,650,112 | 10,596,345 | ||||||
| Annualized Performance Ratios (Bank Only) | |||||||||
| Return on Average Assets | 2.43 | % | 1.71 | % | 1.65 | % | |||
| Return on Average Equity | 18.97 | % | 13.33 | % | 12.37 | % | |||
| Equity/Assets | 13.03 | % | 12.70 | % | 13.23 | % | |||
| Yield on Earning Assets | 6.23 | % | 6.20 | % | 6.05 | % | |||
| Cost of Funds | 1.96 | % | 1.98 | % | 2.18 | % | |||
| Net Interest Margin | 4.48 | % | 4.43 | % | 4.10 | % | |||
| Efficiency Ratio | 36.96 | % | 50.97 | % | 58.90 | % | |||
| Credit Metrics | |||||||||
| Allowance for Loan Losses to Total Loans | 1.27 | % | 1.28 | % | 1.30 | % | |||
| Adversely Classified Assets to Tier 1 Capital plus Allowance for Loan Losses | 9.39 | % | 9.51 | % | 6.15 | % | |||
