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Fifth District Bancorp, Inc.

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Business Summary

Fifth District Bancorp, Inc. (the "Company") operates primarily through its wholly-owned subsidiary, Fifth District Savings Bank, a federally-chartered savings bank with its main office in New Orleans, Louisiana, and six branch offices located in the Parishes of Jefferson, Orleans, and St. Tammany. The Company was incorporated in February 2024 and became the holding company for Fifth District Savings Bank upon its conversion from mutual to stock form on July 31, 2024. The Company is a registered savings and loan holding company subject to regulation by the Board of Governors of the Federal Reserve System, while the Bank is regulated by the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) .

The Company faces strong competition in its primary market area, the New Orleans-Metairie Metropolitan Statistical Area (MSA), from large money center banks, regional banks, community banks, savings institutions, credit unions, mortgage banking firms, consumer finance companies, and fintech companies . As of June 30, 2025, Fifth District Savings Bank ranked 11th among 26 FDIC-insured financial institutions in Jefferson Parish with a deposit market share of 2.30% , 9th among 21 in Orleans Parish with a deposit market share of 0.89% , and 22nd among 27 in St. Tammany Parish with a deposit market share of 0.39% . The Company's ability to compete does not depend on any existing relationships .

Fifth District Bancorp's core business model revolves around generating net interest income, which is the difference between interest earned on interest-earning assets and interest paid on interest-bearing liabilities . The Company primarily originates and retains fixed-rate one-to four-family residential mortgage loans, and to a lesser extent, construction loans, home equity loans, home equity lines of credit, land loans, commercial real estate loans, commercial and industrial loans, and share loans . Revenue is also generated from non-interest income, primarily service charges on deposit accounts, ATM and check card fees, income from bank-owned life insurance, and fees from third parties for loan referrals . The Company's primary customer segments are individuals and businesses within its primary market area, and it emphasizes personalized and efficient customer service to attract and retain a loyal local customer base .

The loan portfolio is predominantly composed of one-to-four family residential mortgage loans, which totaled $325.8 million or 86.34% of total loans at December 31, 2025. These are primarily fixed-rate loans for 10-year and 15-year terms, with loan-to-value ratios generally limited to 80% (or 90% with a rate adjustment) . The Company does not offer adjustable-rate residential mortgages, interest-only loans, negative amortization loans, or subprime loans (generally to borrowers with credit scores less than 620) .

Construction and land development loans totaled $12.5 million or 3.32% of total loans at December 31, 2025, including $1.0 million in land loans. These are primarily residential construction loans structured as construction/permanent loans that convert to fixed-rate residential mortgages after a 12-month construction period . Commercial real estate loans amounted to $10.5 million or 2.79% of total loans, offered to businesses for purchase or refinance of commercial and other non-residential real estate, typically with fixed rates for up to 5 years and amortization periods up to 25 years . Commercial and industrial loans totaled $14.2 million or 3.77% of total loans, with $11.5 million of these being purchased from Bankers Healthcare Group, LLC (BHG) and $2.3 million from U.S. government agencies . Home equity loans and lines of credit were $10.1 million or 2.67% of total loans, with lines of credit having a 10-year draw period and a 15-year payback period, and interest rates based on the prime rate with a 6.25% floor and an 18% annual lifetime ceiling . Consumer loans totaled $4.2 million or 1.11% of total loans, comprising share loans and purchased BHG consumer loans .

For the year ended December 31, 2025, the Company reported net income of $4.1 million , a significant increase from a net loss of ($1.1) million in 2024. Total assets grew by $7.1 million to $534.4 million . Loans receivable, net, increased by $9.1 million to $376.4 million . Deposits increased by $1.7 million to $393.2 million . Total stockholders' equity increased by $4.0 million to $129.8 million . Diluted EPS was $0.80 for 2025, compared to ($0.21) for 2024. The allowance for credit losses on loans remained at $1.7 million for both periods.

Year-over-year, total interest and dividend income increased by $2.8 million or 14.4% to $22.1 million in 2025, driven by a $1.6 million increase in interest on loans and a $1.5 million increase in interest on investment securities available-for-sale. Net interest income increased by $2.8 million or 27.8% to $12.8 million . The interest rate spread increased to 2.04% from 1.68% , and the net interest margin increased to 2.55% from 2.13% . Non-interest income saw a substantial increase of $4.4 million or 4017.3% to $4.4 million , primarily due to a $3.5 million gain on bank-owned life insurance proceeds . Noninterest expense increased by $370,000 or 2.9% to $13.1 million , mainly due to a $958,000 increase in salaries and employee benefits, partially offset by a $1.3 million decrease in charitable contributions .

During the reported period, the Company completed its conversion from a mutual form of organization to a stock form on July 31, 2024, selling 5,459,473 shares of common stock at $10.00 per share and issuing 100,000 shares to The Fifth District Community Foundation, Inc. . The Company also authorized a stock repurchase program on August 25, 2025, for up to 555,947 shares , and repurchased 173,711 shares at an average price of $13.72 during the quarter ended December 31, 2025 . The Company also adopted the 2025 Equity Incentive Plan on September 15, 2025, which permits the grant of up to 555,947 shares of common stock and issued 55,595 restricted stock awards in 2025 .

Business Outlook

The Company's business strategy emphasizes building long-term value for stockholders by operating as a profitable community-oriented financial institution . A key aspect of this strategy is to continue focusing on originating fixed-rate one-to four-family residential mortgage loans for retention in its portfolio, as these loans constituted $325.8 million , or 86.3% , of the total loan portfolio at December 31, 2025 . Residential mortgage lending is expected to remain the primary lending activity .

Another growth area involves a moderate increase in the commercial and industrial loan portfolio. At December 31, 2025, commercial real estate, commercial and industrial loans, and loan participations accounted for $24.8 million , or 6.6% , of the total loan portfolio . These loans are identified as higher-yielding and having shorter terms, which helps to mitigate interest rate risk compared to one-to four-family residential mortgage loans .

Operationally, the Company intends to maintain strong asset quality through conservative underwriting standards and credit monitoring processes . At December 31, 2025, nonperforming assets totaled $586,000 , representing 0.1% of total assets . Efforts will continue to grow low-cost "core" deposits, defined as all deposits other than certificates of deposit, which totaled $153.4 million , or 39.0% , of total deposits at December 31, 2025 . This strategy aims to provide a stable source of funds to support loan growth at costs consistent with improving the interest rate spread and net interest margin . The Company also plans to remain a community-oriented institution, relying on high-quality service to maintain and build a loyal local customer base .

The Company plans to grow organically on a managed basis, leveraging the capital raised in the stock offering to increase lending and investment capacity . Additionally, it may consider expansion opportunities in its market area or contiguous markets that are believed to enhance franchise value and stockholder returns . These opportunities could include establishing loan production offices, new branch offices, acquiring branch offices, and/or acquiring other financial institutions .

Regarding capital allocation, the Company authorized a stock repurchase program on August 25, 2025, for up to 555,947 shares of its common stock, representing 10% of shares then outstanding . The Company intends to conduct these repurchases on the open market, including through a Rule 10b5-1 trading plan, subject to market conditions . There is no guarantee as to the number of shares that may ultimately be repurchased, and the program may be suspended or discontinued at any time . The Company has not paid any cash dividends to stockholders to date, and future dividend payments are subject to statutory and regulatory limitations, financial condition, results of operations, tax considerations, and general economic conditions .

Risk Factors

The Company faces several material risks, including general economic conditions, nationally or in its market area, being worse than expected . Inflation and changes in the interest rate environment could reduce margins and yields, the fair value of financial instruments, or loan origination volume, or increase defaults, losses, and prepayments within the loan portfolio . The ability to access cost-effective funding and maintain adequate liquidity, primarily through deposits, is also a risk . Fluctuations in real estate values and conditions in the residential real estate market pose a risk . Changes in laws, government regulations, or policies affecting financial institutions, including regulatory fees, capital requirements, and insurance premiums, could have an adverse impact . Technological changes that are more difficult or expensive than expected, the inability of third-party providers to perform as expected, and failures or breaches of operational or information security systems, including cyberattacks, are also significant risks . The Company's estimated Economic Value of Equity (EVE) would decrease by 25.90% in the event of an instantaneous parallel 200 basis point increase in market interest rates , and net interest income would decrease by 16.57% under the same scenario .

Management Priorities

Management's overall tone to shareholders emphasizes building long-term value by operating as a profitable, community-oriented financial institution dedicated to meeting customer banking needs through personalized and efficient service . The strategic priorities include continuing to focus on originating fixed-rate one-to four-family residential mortgage loans for portfolio retention, which constituted 86.3% of the total loan portfolio at December 31, 2025 . A second priority is to moderately increase the commercial and industrial loan portfolio, which represented 6.6% of the total loan portfolio at December 31, 2025, due to their higher yields and shorter terms that help mitigate interest rate risk . The third strategic priority is to maintain strong asset quality through conservative underwriting and credit monitoring, as evidenced by nonperforming assets totaling $586,000 or 0.1% of total assets at December 31, 2025 . Management also intends to continue efforts to grow low-cost "core" deposits, which were $153.4 million or 39.0% of total deposits at December 31, 2025, to provide stable funding for loan growth and improve net interest margin .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Fifth District Bancorp, Inc.
  2. [2] Item 1, Business — Competition
  3. [3] Item 1, Business — Competition
  4. [4] Item 1, Business — Competition
  5. [5] Item 1, Business — Competition
  6. [6] Item 1, Business — Competition
  7. [7] Item 7, MD&A — Overview
  8. [8] Item 7, MD&A — Overview
  9. [9] Item 7, MD&A — Overview
  10. [10] Item 7, MD&A — Business Strategy
  11. [11] Item 1, Business — Loan Portfolio Composition
  12. [12] Item 1, Business — Loan Portfolio Composition
  13. [13] Item 1, Business — One- to Four-Family Residential Mortgage Lending
  14. [14] Item 1, Business — One- to Four-Family Residential Mortgage Lending
  15. [15] Item 1, Business — One- to Four-Family Residential Mortgage Lending
  16. [16] Item 1, Business — Loan Portfolio Composition
  17. [17] Item 1, Business — Loan Portfolio Composition
  18. [18] Item 1, Business — Construction and Land Development Loans
  19. [19] Item 1, Business — Construction and Land Development Loans
  20. [20] Item 1, Business — Loan Portfolio Composition
  21. [21] Item 1, Business — Loan Portfolio Composition
  22. [22] Item 1, Business — Commercial Real Estate Loans
  23. [23] Item 1, Business — Loan Portfolio Composition
  24. [24] Item 1, Business — Loan Portfolio Composition
  25. [25] Item 1, Business — Commercial and Industrial Loans
  26. [26] Item 1, Business — Commercial and Industrial Loans
  27. [27] Item 1, Business — Commercial and Industrial Loans
  28. [28] Item 1, Business — Commercial and Industrial Loans
  29. [29] Item 1, Business — Loan Portfolio Composition
  30. [30] Item 1, Business — Loan Portfolio Composition
  31. [31] Item 1, Business — Home Equity Loans and Lines of Credit
  32. [32] Item 1, Business — Home Equity Loans and Lines of Credit
  33. [33] Item 1, Business — Home Equity Loans and Lines of Credit
  34. [34] Item 1, Business — Loan Portfolio Composition
  35. [35] Item 1, Business — Loan Portfolio Composition
  36. [36] Item 1, Business — Consumer Loans
  37. [37] Item 7, MD&A — Comparison of Operating Results for the Years Ended December 31, 2025 and December 31, 2024
  38. [38] Item 7, MD&A — Comparison of Operating Results for the Years Ended December 31, 2025 and December 31, 2024
  39. [39] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  40. [40] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  41. [41] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  42. [42] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  43. [43] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  44. [44] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  45. [45] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  46. [46] Item 7, MD&A — Comparison of Financial Condition at December 31, 2025 and December 31, 2024
  47. [47] Item 7, MD&A — Selected Operating Data
  48. [48] Item 7, MD&A — Selected Operating Data
  49. [49] Item 7, MD&A — Provision (Recovery) for Credit Losses
  50. [50] Item 7, MD&A — Interest Income
  51. [51] Item 7, MD&A — Interest Income
  52. [52] Item 7, MD&A — Interest Income
  53. [53] Item 7, MD&A — Interest Income
  54. [54] Item 7, MD&A — Interest Income
  55. [55] Item 7, MD&A — Net Interest Income
  56. [56] Item 7, MD&A — Net Interest Income
  57. [57] Item 7, MD&A — Net Interest Income
  58. [58] Item 7, MD&A — Net Interest Income
  59. [59] Item 7, MD&A — Net Interest Income
  60. [60] Item 7, MD&A — Net Interest Income
  61. [61] Item 7, MD&A — Net Interest Income
  62. [62] Item 7, MD&A — Noninterest Income
  63. [63] Item 7, MD&A — Noninterest Income
  64. [64] Item 7, MD&A — Noninterest Income
  65. [65] Item 7, MD&A — Noninterest Income
  66. [66] Item 7, MD&A — Noninterest Income
  67. [67] Item 7, MD&A — Noninterest Expense
  68. [68] Item 7, MD&A — Noninterest Expense
  69. [69] Item 7, MD&A — Noninterest Expense
  70. [70] Item 7, MD&A — Noninterest Expense
  71. [71] Item 7, MD&A — Noninterest Expense
  72. [72] Item 7, MD&A — Noninterest Expense
  73. [73] Item 1, Business — Fifth District Bancorp, Inc.
  74. [74] Item 1, Business — Fifth District Bancorp, Inc.
  75. [75] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  76. [76] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  77. [77] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  78. [78] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  79. [79] Item 13, Note 13 — Stock-Based Compensation
  80. [80] Item 13, Note 13 — Stock-Based Compensation
  81. [81] Item 13, Note 13 — Stock-Based Compensation
  82. [82] Item 7, MD&A — Business Strategy
  83. [83] Item 7, MD&A — Business Strategy
  84. [84] Item 7, MD&A — Business Strategy
  85. [85] Item 7, MD&A — Business Strategy
  86. [86] Item 7, MD&A — Business Strategy
  87. [87] Item 7, MD&A — Business Strategy
  88. [88] Item 7, MD&A — Business Strategy
  89. [89] Item 7, MD&A — Business Strategy
  90. [90] Item 7, MD&A — Business Strategy
  91. [91] Item 7, MD&A — Business Strategy
  92. [92] Item 7, MD&A — Business Strategy
  93. [93] Item 7, MD&A — Business Strategy
  94. [94] Item 7, MD&A — Business Strategy
  95. [95] Item 7, MD&A — Business Strategy
  96. [96] Item 7, MD&A — Business Strategy
  97. [97] Item 7, MD&A — Business Strategy
  98. [98] Item 7, MD&A — Business Strategy
  99. [99] Item 7, MD&A — Business Strategy
  100. [100] Item 7, MD&A — Business Strategy
  101. [101] Item 7, MD&A — Business Strategy
  102. [102] Item 7, MD&A — Business Strategy
  103. [103] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  104. [104] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  105. [105] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  106. [106] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  107. [107] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  108. [108] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  109. [109] Item 1, Business — Forward Looking Statements
  110. [110] Item 1, Business — Forward Looking Statements
  111. [111] Item 1, Business — Forward Looking Statements
  112. [112] Item 1, Business — Forward Looking Statements
  113. [113] Item 1, Business — Forward Looking Statements
  114. [114] Item 1, Business — Forward Looking Statements
  115. [115] Item 7, MD&A — Economic Value of Equity
  116. [116] Item 7, MD&A — Economic Value of Equity
  117. [117] Item 7, MD&A — Change in Net Interest Income
  118. [118] Item 7, MD&A — Change in Net Interest Income
  119. [119] Item 7, MD&A — Business Strategy
  120. [120] Item 7, MD&A — Business Strategy
  121. [121] Item 7, MD&A — Business Strategy
  122. [122] Item 7, MD&A — Business Strategy
  123. [123] Item 7, MD&A — Business Strategy
  124. [124] Item 7, MD&A — Business Strategy
  125. [125] Item 7, MD&A — Business Strategy
  126. [126] Item 7, MD&A — Business Strategy
  127. [127] Item 7, MD&A — Business Strategy
  128. [128] Item 7, MD&A — Business Strategy
  129. [129] Item 7, MD&A — Business Strategy

Analysis on 5/21/2026