First National Corporation reported a consolidated net loss of $933 thousand, or $0.10 diluted loss per common share, for the fourth quarter of 2024. However, adjusted operating earnings for the quarter were $6.0 million, or $0.66 per adjusted diluted common share, reflecting the initial combined financial results with Touchstone Bankshares, Inc.
Net interest income for the fourth quarter increased by $6.6 million to $18.4 million compared to the prior quarter, driven by a $545.3 million increase in average interest-earning assets from the Touchstone acquisition. The net interest margin expanded by 40 basis points to 3.83%, benefiting from changes in deposit mix and federal funds rate cuts in late 2024.
Noninterest income rose by $3.4 million to $6.4 million, primarily due to a $2.9 million pre-tax bargain purchase gain from the acquisition. Noninterest expense increased by $11.5 million to $21.9 million, largely due to $7.3 million in pre-tax merger-related expenses and other operational costs associated with the Touchstone integration. Total assets grew to $2.0 billion, and total deposits reached $1.80 billion at year-end 2024, reflecting the significant balance sheet expansion from the merger.
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