Why did SIMA's Q4 net profit surge despite high expenses?

Ledyard Financial Group's Q4 2024 net income increased to $1.3 million, up $607 thousand from the previous quarter and $1.2 million from the same period in the previous year, primarily due to expanded net interest margin, growth in wealth management revenues, and the impact of a sale-leaseback transaction and investment portfolio sales. Here are the key reasons for the notable increase in net profit:

1. **Net Interest Margin Expansion**: The net interest margin expanded, which contributed to the increase in net income. This indicates that the bank earned more on its interest-earning assets relative to the interest-bearing liabilities.
2. **Wealth Management Revenues Increase**: Wealth management revenues increased, which is a positive indicator as it suggests that the bank's investment-related services are performing well. This could be due to factors such as market conditions, investment performance, or an increase in client assets under management.
3. **Sale-leaseback Transaction and Investment Portfolio Sales**: The company executed a sale-leaseback transaction and sold $28 million of investment portfolio at a loss. Although the investment portfolio sales were at a loss, the sale-leaseback transaction could have brought in additional income, which, combined with the portfolio sales, positively impacted the net profit.

In conclusion, SIMA's Q4 net profit surge can be attributed to a combination of factors, including net interest margin expansion, increase in wealth management revenues, and the impact of strategic transactions such as the sale-leaseback transaction and investment portfolio sales.

|code|Ticker|Name|Date|Net Income YoY|Net Income|market_code|
|---|---|---|---|---|---|---|
|SIMA|SIMA.O|SIM Acquisition|2024 Q1||-28464|185|
|SIMA|SIMA.O|SIM Acquisition|2024 Q2||-12841|185|
|SIMA|SIMA.O|SIM Acquisition|2024 Q3||2357270|185|
|SIMA|SIMA.O|SIM Acquisition|2024 Q4||2431139|185|