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FIRST CAPITAL , INC . REPORTS QUARTERLY EARNINGS Corydon , Indiana -- ( BUSINESS WIRE ) -April 27 , 2021. First Capital , Inc. ( the “ Company ” ) ( NASDAQ : FCAP ) , the holding company for First Harrison Bank ( the “ Bank ” ) , today reported net income of $ 2.9 million or $ 0.88 per diluted share for the quarter ended March 31 , 2021 , compared to $ 2.1 million or $ 0.63 per diluted share for the quarter ended March 31 , 2020. The increase in net income is primarily due to an increase in noninterest income . Net interest income after provision for loan losses increased $ 74,000 for the quarter ended March 31 , 2021 as compared to the same period in 2020. Interest income decreased $ 382,000 when comparing the periods due to a decrease in the average tax - equivalent yield on interest - earning assets from 4.10 % for the first quarter of 2020 to 3.13 % for the first quarter of 2021 partially offset by an increase in the average balance of interest - earning assets from $ 761.7 million for the first quarter of 2020 to $ 954.8 million for the first quarter of 2021. The decrease in the tax - equivalent yield was due to the Federal Open Market Committee ( FOMC ) lowering interest rates during March 2020 due to the COVID - 19 pandemic and an increase in the average balance of federal funds sold . Federal funds sold increased primarily due to increased balances in deposit accounts from stimulus programs and normal deposit growth . Interest expense decreased $ 180,000 when comparing the periods due to a decrease in the average cost of interest - bearing liabilities from 0.33 % for the first quarter of 2020 to 0.17 % for the first quarter of 2021 partially offset by an increase in the average balance of interest - bearing liabilities from $ 571.2 million for the first quarter of 2020 to $ 684.7 million for the first quarter of 2021. As a result of the changes in interest- earning assets and interest - bearing liabilities , the interest rate spread decreased from 3.77 % for the quarter ended March 31 , 2020 to 2.96 % for the same period in 2021 . Based on management's analysis of the allowance for loan losses , the provision for loan losses decreased from $ 351,000 for the quarter ended March 31 , 2020 to $ 75,000 for the quarter ended March 31 , 2021. The provision for loan losses was higher in the first quarter of 2020 compared to the first quarter of 2021 due to changes to the qualitative factors within the Bank's allowance for loan losses calculation related to uncertainties that surrounded the COVID - 19 pandemic in the first quarter of 2020. The Bank recognized net charge - offs of $ 72,000 for the quarter ended March 30 , 2021 compared to $ 105,000 for the same period in 2020 . Noninterest income increased $ 982,000 for the quarter ended March 31 , 2021 as compared to the same period in 2020. The first quarter of 2021 included a $ 234,000 unrealized gain on equity securities compared to a $ 394,000 unrealized loss on equity securities during the same period in 2020. Gains on the sale of loans and ATM and debit card fees increased $ 277,000 and $ 203,000 , respectively , when comparing the two periods . This was partially offset by a $ 96,000 decrease in service charges on deposit accounts . Noninterest expense decreased $ 18,000 for the quarter ended March 31 , 2021 as compared to the same period in 2020 , due primarily to decreases in other expenses and advertising expenses of $ 91,000 and $ 58,000 , respectively , partially offset by an increase in professional services of $ 65,000 . Income tax expense increased $ 229,000 for the first quarter of 2021 as compared to the first quarter of 2020 primarily due to an increase in pre - tax net income and a change in Kentucky tax law that subjects the Bank to the state's corporate income tax effective January 1 , 2021 as opposed to the bank franchise tax , which was repealed . As a result , the effective tax rate for the quarter ended March 31 , 2021 was 17.4 % compared to 15.6 % for the same period in 2020 . Total assets increased $ 38.1 million to $ 1.06 billion at March 31 , 2021 from $ 1.02 billion at December 31 , 2020. Cash and cash equivalents and investments securities increased $ 30.1 million and $ 30.0 million , respectively , from December 31 , 2020 to March 31 , 2021 while net loans receivable decreased $ 17.7 million during the same period . Deposit growth funded the increase in assets as deposits grew $ 40.0 million from $ 900.5 million at December 31 , 2020 to $ 940.5 million at March 31 , 2021. Nonperforming assets ( consisting of nonaccrual loans , accruing loans 90 days or more past due , troubled debt restructurings on accrual status , and foreclosed real estate ) increased from $ 3.2 million at December 31 , 2020 to $ 3.3 million at March 31 , 2021. The Bank has assisted customers experiencing a COVID - 19 related hardship by approving payment extensions on loans totaling $ 68.1 million , primarily related to commercial real estate lending relationships . As of March 31 , 2021 , $ 61.7 million of those loans remain outstanding and all have resumed payments . Additionally , the Bank is participating in the Small Business Administration's ( SBA's ) Paycheck Protection Program ( PPP ) , and has approved approximately $ 58.5 million of PPP loans , including $ 12.6 million in second - draw PPP loans originated during 2021. The Bank has received payoffs on $ 30.6 million of PPP loans from the SBA , and as of March 31 , 2021 had $ 990,000 remaining in deferred fees related to PPP loans . At March 31 , 2021 , the Bank was considered well - capitalized under applicable federal regulatory capital guidelines .