The Bank Slate

INSIGHTS INTO THE BANKING INDUSTRY

First Savings in Ind. shifts strategy for home equity lines of credit

First Savings Financial Group in Jeffersonville, Ind., sold a large pool of home equity lines of credit as it shifted its strategy for those originations.

The $2.4 billion-asset company said in a press release that it sold $87.2 million of home equity lines of credit in the final quarter of 2024 for a net gain of $2.5 million. The sale also contributed to the decision to record a $490,000 reversal to the company’s loan-loss provision.

The sale also contributed to a 2.4% linked-quarter decline in total assets.

The sale is part of a strategic initiative to shift from holding first lien home equity lines of credit to selling them, Larry Myers, the company’s president and CEO, said in the release. The goal is to improve noninterest income, moderate the loan-to-deposit ratio, decrease reliance on noncore funding, and generate capital.

Myers said that surplus capital generated from sales could be used to retire high-cost subordinated debt and to buy back stock.

Leave a Reply

Your email address will not be published. Required fields are marked *