Malaga Financial Corp., the holding company for Palos Verdes Estates-based Malaga Bank, reported a net income of over $6 million for its first quarter ending on March 31.
The holding company, traded on the over-the-counter market, reported a net-income increase from the same period last year, signaling health amid high interest rates and a rocky regional banking market.
“We are pleased to report strong earnings for the first quarter of 2024,” said Randy Bowers, president and chief executive of Malaga. “The operating environment has been challenging with continued pressure on the net interest margin and the impact of inflation on expenses.”
The bank did not disclose the quarter’s net interest margin. As an over-the-counter stock, Malaga is not subject to the same financial disclosures as banks listed on the New York Stock Exchange or the Nasdaq.
Malaga did say its expenses increased
2% compared the same quarter last year. The company attributed the hike to increased deposit insurance premiums, data processing and office rent.
Malaga Bank operates six offices in the South Bay. It is a full-service banking outlet.
Malaga Financial saw assets decrease to $1.48 billion at the end of last year compared to the $1.5 billion reported at the end of 2022. The bank attributed the drop to a decrease in deposits, as people move excess cash into alternative investments such as real estate and stocks.
“We encountered exceptionally weak loan demand and heightened competition for deposits from large banks, pushing the cost of funds higher,” Bowers said in Malaga’s annual earnings.
