Primis Financial Corp. ((FRST)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Primis Financial Corp. recently held its earnings call, revealing a strong financial performance for the third quarter of 2025. The company reported significant growth in net earnings and improved return metrics, showcasing successful expansion in key business divisions. However, the call also highlighted challenges related to credit concerns with nonaccrual loans, which require resolution.
Significant Improvement in Net Earnings
Primis Financial reported a remarkable increase in net earnings, reaching $6.8 million or $0.28 per share for Q3 2025. This is a substantial rise from the $2 million or $0.08 per share reported in Q3 2024, indicating a strong upward trajectory in the company’s financial health.
Improved Return Metrics
The company achieved improved return metrics, with Return on Assets (ROA) and Return on Tangible Common Equity (ROTCE) increasing to 70 basis points and 9.45%, respectively. The core ROA is expected to reach 90 basis points, underscoring the company’s robust ongoing performance.
Core Margin Growth
Primis Financial’s core margin grew to 3.15%, up from 3.12% in Q2 2025 and 35 basis points higher than a year ago. This growth reflects the company’s ability to enhance its profitability through strategic financial management.
Noninterest-bearing Deposit Growth
The company saw a 16% year-over-year growth in noninterest-bearing checking accounts, which improved the deposit mix and reduced the cost of deposits by 20%. This growth is a positive indicator of the company’s financial stability and customer trust.
Mortgage Division Expansion
Primis Financial’s mortgage division experienced significant expansion, with monthly production increasing from $20 million to $100-$120 million. This growth resulted in pretax earnings of $1.9 million, marking the division’s strongest quarter to date.
Panacea Division Success
The Panacea division reported substantial growth, with loan balances and deposits increasing significantly. Deposits grew by 50% year-over-year, with a cost of deposits at 1.37%, lower than the core bank, highlighting the division’s success.
Credit Concerns with Nonaccrual Loans
Despite the positive financial performance, Primis Financial faces challenges with credit concerns related to nonaccrual loans. Issues with two office real estate properties and two other loans, one with a $7.5 million exposure, have impacted the company’s financial results.
Forward-Looking Guidance
Looking ahead, Primis Financial Corp. anticipates continued improvement in its financial metrics. The company expects its core ROA to align with a 1% target and foresees further enhancement in its core margin by 6 to 8 basis points. The mortgage division is projected to maintain its increased production levels, contributing to long-term profitability goals.
In conclusion, Primis Financial Corp.’s earnings call highlighted a strong financial performance, with significant growth in net earnings and improved return metrics. The company’s strategic initiatives in key business divisions have yielded positive results, although challenges with nonaccrual loans remain. Overall, the outlook is optimistic, with expectations of continued financial improvement and strategic growth.