• Net Income: C&F Financial Corp reported a consolidated net income of $23.7 million for 2023, down from $29.4 million in 2022.

• Earnings Per Share: Earnings per share were $6.92 for 2023, compared to $8.29 in 2022.

• Return on Assets and Equity: Return on average assets was 0.99% and return on average equity was 11.68% for 2023.

• Community Banking Segment: This segment reported net income of $22.9 million for 2023, showing resilience despite industry challenges.

• Mortgage Banking Segment: The segment faced a net loss of $103,000 in Q4 2023, but overall net income for the year was $465,000.

• Consumer Finance Segment: Reported net income of $618,000 for Q4 and $2.9 million for the year, reflecting a decrease from 2022 figures.

• Liquidity and Capital: The company maintains a strong liquidity position with liquid assets and borrowing availability exceeding uninsured deposits by $429.7 million as of December 31, 2023.

• Warning! GuruFocus has detected 2 Warning Sign with CFFI.

On January 24, 2024, C&F Financial Corp (NASDAQ:CFFI) released its 8-K filing, announcing its financial results for the year ended December 31, 2023. The American bank holding company, which operates through its subsidiaries offering banking and financial services to individuals and businesses, faced a challenging year marked by liquidity pressures, inflation, and a difficult interest rate environment.

Financial Performance Overview

The company reported a decrease in consolidated net income to $23.7 million for 2023, down from $29.4 million in the previous year. This decline was partly due to the absence of certain one-time benefits realized in 2022, such as real estate disposal activity and a change in accounting policy. When adjusted for these factors, net income still showed a decrease from $27.0 million in 2022 to $23.7 million in 2023. Basic and diluted earnings per share followed this downward trend, dropping from $8.29 in 2022 to $6.92 in 2023.

Despite the overall decline in net income, C&F Financial Corp's community banking segment remained a bright spot, reporting net income of $22.9 million for the year. This performance underscores the segment's resilience and the company's ability to grow earning assets and deposits in a tough year for the banking industry.

Segment Performance and Challenges

The mortgage banking segment reported a net loss of $103,000 for the fourth quarter of 2023, although it managed to achieve net income of $465,000 for the full year. This segment's performance reflects the broader industry trend of declining mortgage loan originations due to rising interest rates and higher home prices.