First Capital, Inc. Reports Strong Quarterly Earnings

First Capital ( (FCAP) ) has released its Q2 earnings. Here is a breakdown of the information First Capital presented to its investors.

First Capital, Inc., the holding company for First Harrison Bank, operates in the financial sector, providing banking services across Indiana and Kentucky. The company has reported a significant increase in its quarterly earnings, with net income rising to $3.8 million, or $1.13 per diluted share, compared to $2.8 million, or $0.85 per diluted share, in the same period last year. This growth is attributed to higher net interest income, driven by increased interest-earning assets and improved interest margins.

Key financial metrics highlight a robust performance for First Capital, Inc. in the recent quarter. The net interest income after provision for credit losses rose by $1.8 million, reflecting a favorable shift in the average tax-equivalent yield on interest-earning assets from 4.42% to 4.82%. Additionally, the average balance of interest-earning assets increased to $1.18 billion, contributing to the enhanced net interest margin, which climbed from 3.15% to 3.59%. Despite a slight increase in interest expense, the average cost of interest-bearing liabilities decreased, further supporting the company’s financial health.

Noninterest income saw a minor decrease due to losses on equity securities, although this was partially offset by gains from the redemption of a bank-owned life insurance policy. On the expense side, noninterest expenses rose by $494,000, mainly due to higher compensation, benefits, and operational costs. The effective tax rate also increased, reflecting a higher proportion of taxable income.

Looking ahead, First Capital, Inc. appears well-positioned to continue its growth trajectory, supported by strategic asset management and operational efficiencies. The company’s management remains focused on navigating economic uncertainties while capitalizing on opportunities to enhance shareholder value.