Catalyst Bancorp, Inc. Announces 2025 First Quarter Results

Catalyst Bancorp, Inc. (Nasdaq: “CLST”) (the “Company”), the parent company for Catalyst Bank (the “Bank”) (www.catalystbank.com), reported net income of $586,000 for the first quarter of 2025, compared to net income of $626,000 for the fourth quarter of 2024.

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“Loan growth was muted to start the year as market turbulence caused some of our customers to delay projects,” said Joe Zanco, President and Chief Executive Officer of the Company and Bank. “On a brighter note, we were grateful to have received the 'Best Community Banks to Work For' Award at the ICBA's Live Conference in Nashville in March. Our employees continue to do a great job living our values of Truth, Humility, Impact, Now and Connection.”

Loans

Loans totaled $166.1 million at March 31, 2025, down $1.0 million, or less than 1%, from December 31, 2024. The following table sets forth the composition of the Company's loan portfolio as of the dates indicated.

(Dollars in thousands) 3/31/2025 12/31/2024 ChangeReal estate loansOne- to four-family residential $ 82,025 $ 81,097 $ 928 1 %Commercial real estate 22,103 22,108 (5) -Construction and land 32,038 32,941 (903) (3)Multi-family residential 2,530 2,570 (40) (2)Total real estate loans 138,696 138,716 (20) -Other loansCommercial and industrial 25,447 26,439 (992) (4) %Consumer 1,934 1,921 13 1Total other loans 27,381 28,360 (979) (3)Total loans $ 166,077 $ 167,076 $ (999) (1)

The following table presents certain major segments of our commercial real estate, construction and land, and commercial and industrial loan balances as of the dates indicated.

(Dollars in thousands) 3/31/2025 12/31/2024 ChangeCommercial real estateRetail $ 3,723 $ 4,005 $ (282) (7) %Hospitality 3,342 3,460 (118) (3)Restaurants 1,070 1,091 (21) (2)Oilfield services 393 402 (9) (2)Other non-owner occupied 2,479 2,658 (179) (7)Other owner occupied 11,096 10,492 604 6Total commercial real estate $ 22,103 $ 22,108 $ (5) -Construction and landMulti-family residential $ 11,297 $ 10,031 $ 1,266 13 %Health service facilities 8,626 7,139 1,487 21Hospitality 2,716 2,716 – -Retail 6,077 5,106 971 19Other commercial construction and land 1,791 4,364 (2,573) (59)Consumer residential construction and land 1,531 3,585 (2,054) (57)Total construction and land $ 32,038 $ 32,941 $ (903) (3)Commercial and industrialOilfield services $ 8,474 $ 14,823 $ (6,349) (43) %Industrial equipment 8,285 2,831 5,454 193Professional services 3,119 3,127 (8) (0)Other commercial and industrial 5,569 5,658 (89) (2)Total commercial and industrial loans $ 25,447 $ 26,439 $ (992) (4)

Credit Quality and Allowance for Credit Losses

At March 31, 2025, non-performing assets (“NPAs”) totaled $1.7 million, down $103,000, or 6%, from $1.8 million at December 31, 2024 primarily due to a decline in foreclosed assets. The ratio of NPAs to total assets was 0.63% and 0.66% at March 31, 2025 and December 31, 2024, respectively. Non-performing loans (“NPLs”) comprised 0.99% and 0.98% of total loans at March 31, 2025 and December 31, 2024, respectively. At March 31, 2025 and December 31, 2024, 98% of total NPLs were one- to four-family residential mortgage loans.

At both March 31, 2025 and December 31, 2024, the allowance for credit losses on loans totaled $2.5 million, or 1.51% of total loans. The provision for credit losses was zero for the first quarter of 2025 and the fourth quarter of 2024. Net loan charge-offs totaled $39,000 during the first quarter of 2025, compared to net charge-offs of $2,000 for the fourth quarter of 2024. Net loan charge-offs during the first quarter of 2025 were primarily related to residential mortgage loans and overdrawn deposit accounts.

Deposits

Total deposits were $180.6 million at March 31, 2025, down $5.1 million, or 3%, from December 31, 2024. Total deposits averaged $177.1 million during the first quarter of 2025, compared to $171.0 million during the fourth quarter of 2024. The fluctuations in total deposits were mainly due to public funds. The following table sets forth the composition of the Company's deposits as of the dates indicated.

(Dollars in thousands) 3/31/2025 12/31/2024 ChangeNon-interest-bearing demand deposits $ 26,093 $ 28,281 $ (2,188) (8) %Interest-bearing demand deposits 42,737 48,334 (5,597) (12)Money market 9,737 10,729 (992) (9)Savings 42,542 37,639 4,903 13Certificates of deposit 59,489 60,691 (1,202) (2)Total deposits $ 180,598 $ 185,674 $ (5,076) (3)

The ratio of the Company's total loans to total deposits was 92% at March 31, 2025, compared to 90% at December 31, 2024.

Total public fund deposits amounted to $29.8 million, or 17% of total deposits, at March 31, 2025, compared to $35.6 million, or 19% of total deposits, at December 31, 2024. At March 31, 2025, approximately 80% of our total public fund deposits consisted of non-interest-bearing and interest-bearing demand deposits from municipalities within our market.

Capital and Share Repurchases

At March 31, 2025 and December 31, 2024, consolidated shareholders' equity totaled $80.6 million, or 29.7% of total assets, and $80.2 million, or 29.0% of total assets, respectively.

The Company repurchased 72,949 shares of its common stock at an average cost per share of $11.86 during the first quarter of 2025, compared to 120,977 shares at an average cost per share of $11.70 during the fourth quarter of 2024. Under the Company's November 2024 Repurchase Plan, 114,201 shares of the Company's common stock were available for repurchase at March 31, 2025. Since the announcement of our first share repurchase plan on January 26, 2023 and through March 31, 2025, the Company has repurchased a total of 1,084,799 shares of its common stock, or approximately 21% of the common shares originally issued, at an average cost per share of $11.93. At March 31, 2025, the Company had common shares outstanding of 4,205,201.

Net Interest Income

The net interest margin for the first quarter of 2025 was 3.89%, down three basis points compared to the prior quarter. For the first quarter of 2025, the average yield on interest-earning assets was 5.54%, down three basis points from the prior quarter, and the average rate paid on interest-bearing liabilities was 2.56%, down one basis point from the fourth quarter of 2024.

Net interest income for the first quarter of 2025 was $2.4 million, down $107,000, or 4%, compared to the fourth quarter of 2024. Total interest income was down $137,000, or 4%, in the first quarter of 2025 compared to the prior quarter primarily due to a decline in income on residential mortgage loans, commercial and industrial loans, and interest-earning cash. Total interest expense decreased $30,000, or 3%, in the first quarter of 2025 compared to the prior quarter. During the fourth quarter of 2024, the Bank's $20.0 million BTFP advance was paid off, which led to a decline in interest expense on borrowings of $112,000 for the first quarter of 2025 compared to the fourth quarter of 2024. The decline in interest expense on borrowings was partially offset by an increase in interest expense on deposits that was largely driven by an increase in the cost of public fund deposits.

The following table sets forth, for the periods indicated, the Company's total dollar amount of interest income from average interest-earning assets and the resulting yields, as well as the interest expense on average interest-bearing liabilities, expressed both in dollars and rates, and the net interest margin. Taxable equivalent (“TE”) yields have been calculated using a marginal tax rate of 21%. All average balances are based on daily balances.

Three Months Ended 3/31/2025 12/31/2024(Dollars in thousands) Average Interest Average Average Interest Average Balance Yield/ Balance Yield/ Rate(TE) Rate(TE)INTEREST-EARNING ASSETSLoans receivable(1) $ 166,145 $ 2,738 6.68 % $ 167,187 $ 2,814 6.70 %Investment securities(2) 46,960 275 2.35 47,764 273 2.30Other interest earning assets 33,585 361 4.36 36,107 424 4.66Total interest-earning assets $ 246,690 $ 3,374 5.54 $ 251,058 $ 3,511 5.57INTEREST-BEARING LIABILITIESDemand deposits, money market, and $ 94,133 $ 483 2.08 % $ 85,118 $ 394 1.84 %savings accountsCertificates of deposit 55,846 458 3.32 57,031 465 3.24Total interest-bearing deposits 149,979 941 2.54 142,149 859 2.40Borrowings 9,573 68 2.85 18,663 180 3.85Total interest-bearing liabilities $ 159,552 $ 1,009 2.56 $ 160,812 $ 1,039 2.57Net interest-earning assets $ 87,138 $ 90,246Net interest income; average interest rate $ 2,365 2.98 % $ 2,472 3.00 %spreadNet interest margin(3) 3.89 3.92(1) Includes non-accrual loans during the respective periods. Calculated net of deferred fees and discounts and loans in-process.(2) Average investment securities does not include unrealized holding gains/losses on available-for-sale securities.(3) Equals net interest income divided by average interest-earning assets. Taxable equivalent yields are calculated using a marginal tax rate of 21%.

Non-interest Income

Non-interest income for the first quarter of 2025 totaled $553,000, up $216,000, or 64%, compared to the fourth quarter of 2024. Non-interest income for the first quarter of 2025 included insurance proceeds of $216,000 for fire and flood damages related to foreclosed properties.

Non-interest Expense

Non-interest expense for the first quarter of 2025 totaled $2.2 million, up $160,000, or 8%, compared to the fourth quarter of 2024. Foreclosed assets expense for the first quarter of 2025 included net losses of $88,000 on the sale of foreclosed properties.

Salaries and employee benefits expense totaled $1.2 million for the first quarter of 2025, up $18,000, or 1%, from the prior quarter primarily due to an increase in the cost of employee benefits for 2025.

Advertising and marketing expense totaled $39,000 for the first quarter of 2025, up $22,000, or 129%, from the prior quarter largely driven by an increase in business development activity during the first quarter of 2025.

Other non-interest expense totaled $207,000 for the first quarter of 2025, up $19,000, or 10%, from the prior quarter primarily due to an increase in loan collection related expenses.

About Catalyst Bancorp, Inc.

Catalyst Bancorp, Inc. (Nasdaq: CLST) is a Louisiana corporation and registered bank holding company for Catalyst Bank, its wholly-owned subsidiary, with $271.6 million in assets at March 31, 2025. Catalyst Bank, formerly St. Landry Homestead Federal Savings Bank, has been in operation in the Acadiana region of south-central Louisiana for over 100 years. With a focus on fueling business and improving lives throughout the region, Catalyst Bank offers commercial and retail banking products through our six full-service branches located in Carencro, Eunice, Lafayette, Opelousas, and Port Barre. To learn more about Catalyst Bancorp and Catalyst Bank, visit www.catalystbank.com, or the website of the Securities and Exchange Commission, www.sec.gov.

Forward-looking Statements

This news release reflects industry conditions, Company performance and financial results and contains “forward-looking statements,' which may include forecasts of our financial results and condition, expectations for our operations and businesses, and our assumptions for those forecasts and expectations. Do not place undue reliance on forward-looking statements. These forward-looking statements are subject to a number of risk factors and uncertainties which could cause the Company's actual results and experience to differ materially from the anticipated results and expectation expressed in such forward-looking statements.

Factors that could cause our actual results to differ materially from our forward-looking statements are described under “Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Supervision and Regulation” in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and in other documents subsequently filed by the Company with the Securities and Exchange Commission, available at the SEC's website and the Company's website, each of which are referenced above. To the extent that statements in this news release relate to future plans, objectives, financial results or performance by the Company, these statements are deemed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are generally identified by use of words such as “may,” “believe,” “expect,” “anticipate,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential” or the negative of these terms or other comparable terminology.

Forward-looking statements represent management's beliefs, based upon information available at the time the statements are made, with regard to the matters addressed; they are not guarantees of future performance. Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements. All information is as of the date of this news release. Except to the extent required by applicable law or regulation, the Company undertakes no obligation to revise or update publicly any forward-looking statement for any reason.

CATALYST BANCORP, INC. AND SUBSIDIARYCONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited) (Unaudited)(Dollars in thousands) 3/31/2025 12/31/2024 3/31/2024ASSETSNon-interest-bearing cash $ 4,128 $ 4,076 $ 3,118Interest-bearing cash and due from banks 36,190 40,219 72,893Total cash and cash equivalents 40,318 44,295 76,011Investment securities:Securities available-for-sale, at fair value 29,840 28,712 25,534Securities held-to-maturity 13,445 13,447 13,457Loans receivable, net of unearned income 166,077 167,076 143,491Allowance for credit losses (2,500) (2,522) (2,068)Loans receivable, net 163,577 164,554 141,423Accrued interest receivable 866 851 733Foreclosed assets 77 194 237Premises and equipment, net 6,049 6,085 5,995Stock in correspondent banks, at cost 809 1,961 1,898Bank-owned life insurance 14,607 14,489 14,139Other assets 2,060 2,109 2,622TOTAL ASSETS $ 271,648 $ 276,697 $ 282,049LIABILITIESDeposits:Non-interest-bearing $ 26,093 $ 28,281 $ 28,836Interest-bearing 154,505 157,393 140,801Totaldeposits 180,598 185,674 169,637Borrowings 9,603 9,558 29,423Other liabilities 856 1,261 1,736TOTAL LIABILITIES 191,057 196,493 200,796SHAREHOLDERS' EQUITYCommon stock 42 43 46Additional paid-in capital 38,844 39,561 42,711Unallocated common stock held by benefit plans (5,649) (5,702) (6,169)Retained earnings 50,446 49,860 48,260Accumulated other comprehensive income (loss) (3,092) (3,558) (3,595)TOTAL SHAREHOLDERS' EQUITY 80,591 80,204 81,253TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 271,648 $ 276,697 $ 282,049CATALYST BANCORP, INC. AND SUBSIDIARYCONSOLIDATED STATEMENTS OF INCOME(Unaudited) Three Months Ended(Dollars in thousands) 3/31/2025 12/31/2024 3/31/2024INTEREST INCOMELoans receivable, including fees $ 2,738 $ 2,814 $ 2,214Investment securities 275 273 325Cash and due from banks 341 401 594Other 20 23 22Total interest income 3,374 3,511 3,155INTEREST EXPENSEDeposits 941 859 769Borrowings 68 180 293Total interest expense 1,009 1,039 1,062Net interest income 2,365 2,472 2,093Provision for credit losses – – 95Net interest income after provision for credit losses 2,365 2,472 1,998NON-INTEREST INCOMEService charges on deposit accounts 197 201 203Bank-owned life insurance 118 119 113Loss on sales of investment securities – – (5,507)Other income on foreclosed assets 216 – -Gain (loss) on disposals and sales of fixed assets – – 11Other 22 17 17Total non-interest income (loss) 553 337 (5,163)NON-INTEREST EXPENSESalaries and employee benefits 1,245 1,227 1,260Occupancy and equipment 199 193 196Data processing and communication 182 179 794Professional fees 101 94 107Directors' fees 114 116 115ATM and debit card 22 17 69Foreclosed assets, net 89 7 8Advertising and marketing 39 17 38Other 207 188 204Total non-interest expense 2,198 2,038 2,791Income (loss) before income tax expense (benefit) 720 771 (5,956)Income tax expense (benefit) 134 145 (1,267)NET INCOME (LOSS) $ 586 $ 626 $ (4,689)Earnings (loss) per share:Basic $ 0.16 $ 0.16 $ (1.15)Diluted 0.16 0.16 (1.15)CATALYST BANCORP, INC. AND SUBSIDIARYSELECTED FINANCIAL DATA Three Months Ended(Dollars in thousands) 3/31/2025 12/31/2024 3/31/2024EARNINGS DATATotal interest income $ 3,374 $ 3,511 $ 3,155Total interest expense 1,009 1,039 1,062Net interest income 2,365 2,472 2,093Provision for credit losses – – 95Total non-interest income (loss) 553 337 (5,163)Total non-interest expense 2,198 2,038 2,791Income tax expense (benefit) 134 145 (1,267)Net income (loss) $ 586 $ 626 $ (4,689)AVERAGE BALANCE SHEET DATATotal loans $ 166,145 $ 167,187 $ 144,428Total interest-earning assets 246,690 251,058 269,835Total assets 268,232 272,443 286,708Total interest-bearing deposits 149,979 142,149 146,201Total interest-bearing liabilities 159,552 160,812 174,192Total deposits 177,106 170,991 174,656Total shareholders' equity 80,426 80,988 82,667SELECTED RATIOSReturn on average assets 0.89 % 0.91 % (6.58) %Return on average equity 2.96 3.08 (22.81)Efficiency ratio 75.31 72.54 (90.93)Net interest margin(TE) 3.89 3.92 3.12Average equity to average assets 29.98 29.73 28.83Common equity Tier 1 capital ratio(1) 46.95 45.81 52.09Tier 1 leverage capital ratio(1) 29.45 28.73 26.84Total risk-based capital ratio(1) 48.20 47.06 53.34NON-FINANCIAL DATATotal employees (full-time equivalent) 49 49 47Common shares issued and outstanding, end of period 4,205,201 4,278,150 4,558,329(1) Capital ratios are preliminary end-of-period ratios for the Bank only and are subject to change.CATALYST BANCORP, INC. AND SUBSIDIARYSELECTED FINANCIAL DATA(continued) Three Months Ended(Dollars in thousands) 3/31/2025 12/31/2024 3/31/2024ALLOWANCE FOR CREDIT LOSSESLoans:Beginning balance $ 2,522 $ 2,414 $ 2,124Provision for credit losses 17 110 42Charge-offs (53) (28) (123)Recoveries 14 26 25Net (charge-offs) recoveries (39) (2) (98)Ending balance $ 2,500 $ 2,522 $ 2,068Unfunded commitments:Beginning balance $ 121 $ 231 $ 257Provision for (reversal of) credit losses on (17) (110) 53unfunded commitmentsEnding balance $ 104 $ 121 $ 310Total provision for credit losses $ – $ – $ 95CREDIT QUALITY(1)Non-accruing loans $ 1,554 $ 1,567 $ 1,453Accruing loans 90 days or more past due 91 64 29Total non-performing loans 1,645 1,631 1,482Foreclosed assets 77 194 237Total non-performing assets $ 1,722 $ 1,825 $ 1,719Total non-performing loans to total loans 0.99 % 0.98 % 1.03 %Total non-performing assets to total assets 0.63 0.66 0.61(1) Credit quality data and ratios are as of the end of each period presented.

For more information:Joe Zanco, President and CEO(337) 948-3033

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