Fidelity D & D Bancorp, Inc. (NASDAQ: FDBC) and its banking
subsidiary, The Fidelity Deposit and Discount Bank, announced its
unaudited, consolidated financial results for the three and twelve
month periods ended December 31, 2022.
Unaudited Financial Information
Net income recorded for the year ended December 31, 2022 was
$30.0 million, or $5.29 diluted earnings per share, compared to
$24.0 million, or $4.48 diluted earnings per share, for the year
ended December 31, 2021. The $6.0 million, or 25% improvement
in net income stemmed from the $10.5 million improvement in
net interest income partially offset by $1.6 million less
non-interest income, $1.2 million in additional non-interest
expenses and a $1.4 million higher provision for income taxes.
The acquisition of Landmark Bancorp, Inc. (“Landmark”) during
the third quarter of 2021 resulted in growth in the Company’s
earning assets which contributed to net interest income growth. The
Company continued to operate four community banking
offices acquired from Landmark which contributed to the increased
operating expenses.
“We are pleased with our outstanding
2022 financial results. Fidelity Bank achieved record
financial results and increased an already strong regulatory
capital position. The year was marked by the successful
execution of key strategic initiatives and synergies from the
Landmark acquisition. Our asset quality metrics
remain strong, and our solid capital position allowed us
to increase our dividend payments to our shareholders for the
eighth consecutive year,” stated Daniel J. Santaniello, President
and Chief Executive Officer. “As we enter 2023, we are well
positioned to continue to create shareholder value.”
Net income for the quarter ended December 31, 2022 was
$7.1 million, or $1.26 diluted earnings per share,
compared to $7.8 million, or $1.37 diluted earnings per share,
for the quarter ended December 31, 2021. The $0.6 million, or
8%, decline in net income resulted from the $0.5 million
increase in the provision for income taxes, $0.3 million
higher non-interest expenses and a $0.3 million decrease
in non-interest income. The contributors to lower net
income were partially offset by the $0.4 million
improvement in net interest income quarter-over-quarter.
Consolidated Fourth Quarter Operating Results
Overview
Net interest income was $18.3 million for the fourth
quarter of 2022, a 3% increase over
the $17.9 million earned for the fourth quarter of 2021.
The $0.4 million improvement in net interest income resulted
primarily from a $37.4 million increase in the
average balance of interest-earning assets supplemented by a
38 basis point increase in fully-taxable equivalent
(“FTE”) yields on these earning assets partially offset by higher
interest expense. The loan portfolio had the biggest impact,
producing a $1.8 million increase in interest income from
$88.3 million in higher average balances and an increase of 23
basis points in FTE yields earned on loans. Residential real estate
contributed the most to the increase in loan interest income,
growing $1.1 million from $54.7 million in higher average
balances and a 53 basis point increase in FTE yields. Interest
income in the commercial portfolio
increased $0.4 million during the fourth quarter of
2022 versus the fourth quarter of 2021, despite
the recognition of $0.9 million less Small Business
Administration (“SBA”) fees attributable to Paycheck
Protection Program (“PPP”) loans and $0.8 million less in fair
value accretion on acquired loans over the same time periods.
Interest income from the investment portfolio grew $0.3 million
primarily from mortgage-backed securities which increased $4.0
million in average balances and 33 basis point higher FTE yields
earned thereon. Interest income on interest-bearing deposits grew
$0.4 million from higher yields. Partially offsetting the increase
in interest income, interest expense grew $2.1 million primarily
due to a 48 basis point increase in rates paid on
interest-bearing deposits which resulted in $2.0 million in
additional interest expense.
The overall cost of interest-bearing liabilities was 0.74% for
the fourth quarter of 2022, an increase of 51 basis points from the
0.23% paid for the fourth quarter of 2021. The cost of funds
increased 36 basis points to 0.53% for the fourth quarter of 2022
from 0.17% for the fourth quarter of 2021. The Company’s
FTE (non-GAAP measurement) net interest spread was 3.04%
for the fourth quarter of 2022, down 13 basis points from the 3.17%
recorded for the fourth quarter of 2021. FTE net interest margin
increased by three basis points to 3.27% for the three months ended
December 31, 2022 from 3.24% for the same 2021 period. Average
non-interest bearing deposits, which impact net interest margin,
increased $23.4 million quarter-over-quarter resulting in the
widening gap between spread and margin.
The provision for loan losses was $0.5 million for the fourth
quarter of 2022, a $0.1 million increase compared to $0.4
million for the fourth quarter of 2021. The increase was due to the
higher provisioning required for loan growth in the
fourth quarter of 2022 compared to the year earlier period.
This amount of provisioning reflected what management deemed
necessary to maintain the allowance for loan and lease losses at an
adequate level.
Total non-interest income decreased $0.3 million, or 6%,
to $3.9 million for the fourth quarter of
2022 compared to $4.2 million for the fourth quarter of 2021.
The decrease in non-interest income was primarily attributable to
$0.3 million lower gains on the sale of loans and $0.2 million less
service charges on loans primarily from a decline in mortgage
loan service charges and commercial loan late fees. The Company
also recognized $0.1 million less fees from financial services and
$0.1 million lower rental income. Partially offsetting these
decreases was $0.2 million lower losses on disposal of
equipment and $0.1 million higher service charges on deposits.
Non-interest expenses increased $0.3 million, or 2%, for
the fourth quarter of 2022 to $12.9 million from $12.6 million for
the same quarter of 2021. Non-interest expense increases were
primarily due to $0.2 million higher professional services, $0.1
million in additional equipment maintenance and rental expenses and
$0.1 million more in data processing and communications expenses.
These increases were partially offset by decreases of $0.1 million
in FDIC assessment and $0.1 million in advertising and
marketing expenses.
The provision for income taxes increased $0.5 million during the
fourth quarter of 2022 due to an adjustment to the provision
calculation recorded during the fourth quarter of 2022.
Consolidated Year-To-Date Operating Results
Overview
Net interest income was $72.3 million for the year ended
December 31, 2022 compared to $61.8 million for the year ended
December 31, 2021. The $10.5 million, or 17%, improvement was
the result of earnings from a larger average balance of
interest-earning assets supplemented by higher FTE yields earned on
these assets which offset an increase in interest expense from a
larger average balance and rate paid on interest-bearing deposits.
The loan portfolio had the biggest impact, producing $8.6 million
more interest income from $200.8 million in higher average
balances and a one basis point increase in yields. Interest income
in the commercial portfolio increased $3.2 million during 2022
compared to 2021, despite recognition of $3.9 million less SBA fees
attributable to PPP loans over the same time periods. Interest
income from investments increased $3.8 million from a $167.2
million larger average balance in the portfolio along with a 12
basis point increase in yields. On the funding side, interest
expense increased by $2.8 million due to a $217.4 million larger
average balance of interest-bearing deposits and a 14 basis
point increase in the rates paid on those deposits. FTE net
interest spread was 3.16% for 2022, or unchanged from the 3.16%
recorded for 2021. Over the same time period, the Company’s
FTE net interest margin increased by five basis points to 3.28%
from 3.23%. The increase in FTE net interest margin is primarily
attributable to the growth of $76.9 million in average
non-interest-bearing deposits.
For the year ended December 31, 2022, the provision for loan
losses was $2.1 million, a $0.1 million increase compared to $2.0
million for the year ended December 31, 2021. The
increase in provision expense approximated the growth in
loans for the year. This amount of provisioning was respective
to the loan growth achieved during 2022 and reflected what
management deemed necessary to maintain the allowance for loan and
lease losses at an adequate level.
Total non-interest income for the year ended December 31, 2022
was $16.7 million, a decrease of $1.6 million, or 9%, from
$18.3 million for the year ended December 31, 2021. The
decrease in non-interest income was attributable to the decline in
residential mortgage activity stemming from increased mortgage
rates and a reduction in secondary market activity which lowered
the level of gains by $2.5 million during 2022 compared
to 2021. Also, the Company also recorded $0.7 million less service
charges on loans primarily from less mortgage loan service charges.
Partially offsetting these decreases was $0.9 million in higher
service charges on deposits, $0.2 million higher interchange fees
and $0.2 million more fees from trust fiduciary activities.
Non-interest expenses increased to $51.3 million for the year
ended December 31, 2022, an increase of $1.2 million, or 2%, from
$50.1 million for the year ended December 31, 2021. Non-interest
expenses would have increased another $3.4 million if not for
merger-related expenses of $3.0 million and a FHLB prepayment
penalty of $0.4 million incurred during 2021. The largest
driver of this increase was a $2.9 million increase in salaries and
employee benefit expenses primarily from $1.4 million lower
loan origination cost deferrals and $0.9 million higher
salaries. Premises and equipment expenses increased $0.6 million
primarily from additional lease payments and higher equipment
maintenance and rental expenses. PA shares tax expense also
increased $0.3 million year-over-year.
The provision for income taxes increased $1.4 million during
2022 compared to 2021 due to the higher income before taxes and a
$0.2 million adjustment to the
provision calculation recorded during the fourth quarter
of 2022.
Consolidated Balance Sheet & Asset Quality
Overview
The Company’s total assets declined to $2.4 billion as of
December 31, 2022, a decrease of $41 million from
December 31, 2021. Growth in the loan portfolio of $99 million was
offset by a reduction of the investments portfolio by $95 million
primarily due to recording net unrealized losses resulting
from the significantly higher interest rates throughout 2022
along with paydowns and $68 million lower cash balances.
The net growth in loans includes $39 million in paydowns on PPP
loans, net of deferred fees. Partially offsetting the decrease in
the investment portfolio was an increase within other assets
from the $19 million increase in deferred tax assets due to
the unrealized losses in the investment portfolio. During the same
time period, total liabilities increased $8 million. Deposits
declined $3 million and therefore $13 million in short-term
borrowings, after use of excess cash balances, were
needed to fund loan growth.
Shareholders’ equity decreased $48.8 million, or 23%, to $162.9
million at December 31, 2022 from $211.7 million at December 31,
2021. The decrease was caused by an $71.3 million, after tax,
reduction in accumulated other comprehensive income from net
unrealized losses recorded on the investment portfolio
stemming from the increase in intermediate to long-term U.S.
Treasury interest rates. At December 31, 2022, there were no
securities identified with credit-related, other-than-temporary
impairment losses. During 2022, the Company acquired treasury stock
totaling $1.3 million which further reduced shareholders’ equity.
Partially offsetting these decreases, retained earnings improved
from net income of $30.0 million, partially offset by $7.7 million
in cash dividends paid to shareholders. An additional $1.5 million
recorded from the issuance of common stock under the Company’s
stock plans and stock-based compensation also partially
offset the decrease in shareholders’ equity. Accumulated other
comprehensive income (loss) is excluded from regulatory capital
ratios. The Company remains well capitalized with Tier 1 capital at
8.69% of total average assets as of December 31, 2022. Total
risk-based capital was 14.35% of risk-weighted assets and Tier 1
risk-based capital was 13.27% of risk-weighted assets as of
December 31, 2022. Tangible book value per share was $25.18 at
December 31, 2022 compared to $33.68 at December 31, 2021.
Tangible common equity was 6.01% of total assets at December 31,
2022 compared to 7.93% at December 31, 2021.
Asset Quality
Total non-performing assets were $4.1 million, or 0.17% of
total assets, at December 31, 2022, compared to $6.4 million, or
0.27% of total assets, at December 31, 2021. Past due and
non-accrual loans to total loans were 0.28% at December 31, 2022
compared to 0.34% at December 31, 2021. Net charge-offs to average
total loans were 0.04% at December 31, 2022 unchanged compared to
0.04% at December 31, 2021.
Fidelity D & D Bancorp, Inc. has built a strong history as
trusted financial advisor to the clients served by The Fidelity
Deposit and Discount Bank (“Fidelity Bank”). Fidelity Bank operates
21 full-service offices throughout Lackawanna, Luzerne, Lehigh and
Northampton Counties, along with a limited production commercial
office in Luzerne County and a Fidelity Bank Wealth Management
Minersville Office in Schuylkill County. Fidelity Bank provides a
digital and virtual experience via digital services, and digital
account opening offered through online banking at
bankatfidelity.com and the mobile app. Additionally, Fidelity Bank
offers full-service Wealth Management & Brokerage Services, a
Mortgage Center, and an array of personal and business banking
products and services. Part of the Company’s vision is to serve as
the best bank for the community, which was accomplished by having
provided over 4,100 hours of volunteer time and over $1.6
million in donations to non-profit organizations directly within
the markets served throughout 2022. The
Company continues its mission of exceeding client
expectations through a unique banking experience, providing 24
hour, 7 days a week service to clients through branch offices,
online at www.bankatfidelity.com, and through the Customer Care
Center at 800-388-4380. Fidelity Bank’s deposits are insured by the
Federal Deposit Insurance Corporation up to the full extent
permitted by law.
Non-GAAP Financial Measures
The Company uses non-GAAP financial measures to provide
information useful to the reader in understanding its
operating performance and trends, and to facilitate comparisons
with the performance of other financial institutions. Management
uses these measures internally to assess and better understand our
underlying business performance and trends related to core business
activities. The Company’s non-GAAP financial measures and key
performance indicators may differ from the non-GAAP financial
measures and key performance indicators other financial
institutions use to measure their performance and trends.
Non-GAAP financial measures should be supplemental to GAAP used to
prepare the Company’s operating results and should not be read in
isolation or relied upon as a substitute for GAAP measures.
Reconciliations of GAAP to non-GAAP operating measures to the most
directly comparable GAAP financial measures are included in the
tables at the end of this release.
Management believes merger-related expenses are not standard
costs necessary for operations. These charges principally represent
professional fees and system conversion and integration costs
related to the transaction. These costs are specific to each
individual transaction and may vary significantly based on the size
and complexity of the transaction. Management also believes the
FHLB prepayment fee incurred to payoff FHLB advances is
non-recurring and should be excluded from normal operating expenses
for proper comparison.
Interest income was adjusted to recognize the income from tax
exempt interest-earning assets as if the interest was taxable,
fully-taxable equivalent (FTE), in order to calculate certain
ratios within this document. This treatment allows a uniform
comparison among yields on interest-earning assets. Interest income
was FTE adjusted, using the corporate federal tax rate of 21% for
2022 and 2021.
Forward-looking statements
Certain of the matters discussed in this press
release constitute forward-looking statements for purposes of
the Securities Act of 1933, as amended, and the Securities Exchange
Act of 1934, as amended, and as such may involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be
materially different from future results, performance or
achievements expressed or implied by such forward-looking
statements. The words “expect,” “anticipate,” “intend,” “plan,”
“believe,” “estimate,” and similar expressions are intended to
identify such forward-looking statements.
The Company’s actual results may differ materially
from the results anticipated in these forward-looking statements
due to a variety of factors, including, without limitation:
|
■ |
local, regional and national
economic conditions and changes thereto; |
|
■ |
the short-term and long-term
effects of inflation, and rising costs to the Company, its
customers and on the economy; |
|
■ |
the effects of economic
conditions particularly with regard to the negative impact of
severe, wide-ranging and continuing disruptions caused by the
spread of Coronavirus Disease 2019 (COVID-19) and any other
pandemic, epidemic or other health-related crisis and responses
thereto on current customers and the operations of the Company,
specifically the effect of the economy on loan
customers’ ability to repay loans; |
|
■ |
the costs and effects of
litigation and of unexpected or adverse outcomes in such
litigation; |
|
■ |
the impact of new or changes in
existing laws and regulations, including laws and regulations
concerning taxes, banking, securities and insurance and their
application with which the Company and its subsidiaries must
comply; |
|
■ |
impacts of the capital and
liquidity requirements of the Basel III standards and other
regulatory pronouncements, regulations and rules; |
|
■ |
governmental monetary and fiscal
policies, as well as legislative and regulatory changes; |
|
■ |
effects of short- and long-term
federal budget and tax negotiations and their effect on economic
and business conditions; |
|
■ |
the effect of changes in
accounting policies and practices, as may be adopted by the
regulatory agencies, as well as the Financial Accounting Standards
Board and other accounting standard setters; |
|
■ |
the risks of changes and
volatility of interest rates on the level and composition of
deposits, loan demand, and the values of loan collateral,
securities and interest rate protection agreements, as well as
interest rate risks; |
|
■ |
the effects of competition from
other commercial banks, thrifts, mortgage banking firms, consumer
finance companies, credit unions, securities brokerage firms,
insurance companies, money market and other mutual funds and other
financial institutions operating in our market area and elsewhere,
including institutions operating locally, regionally, nationally
and internationally, together with such competitors offering
banking products and services by mail, telephone, computer and the
internet; |
|
■ |
technological changes; |
|
■ |
the interruption or breach in
security of our information systems, continually evolving
cybersecurity and other technological risks and attacks resulting
in failures or disruptions in customer account management, general
ledger processing and loan or deposit updates and potential impacts
resulting therefrom including additional costs, reputational
damage, regulatory penalties, and financial losses; |
|
■ |
acquisitions and integration of
acquired businesses; |
|
■ |
the failure of assumptions
underlying the establishment of reserves for loan losses and
estimations of values of collateral and various financial assets
and liabilities; |
|
■ |
inflation, securities markets and
monetary fluctuations and volatility; |
|
■ |
the short-term and long-term
effects of inflation, and rising costs to the Company, its
customers and on the economy; |
|
■ |
acts of war or terrorism; |
|
■ |
disruption of credit and equity
markets; and |
|
■ |
the risk that our analyses of
these risks and forces could be incorrect and/or that the
strategies developed to address them could be unsuccessful. |
|
|
|
The Company cautions readers not to place undue
reliance on forward-looking statements, which reflect analyses only
as of the date of this release. The Company has no obligation to
update any forward-looking statements to reflect events or
circumstances after the date of this release.
For more information please visit our investor relations
web site located through www.bankatfidelity.com.
FIDELITY D & D BANCORP,
INC.Unaudited Condensed Consolidated Balance
Sheets(dollars in thousands)
At Period End: |
|
December 31, 2022 |
|
|
December 31, 2021 |
|
Assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
29,091 |
|
|
$ |
96,877 |
|
Investment securities |
|
|
643,606 |
|
|
|
738,980 |
|
Restricted investments in bank stock |
|
|
5,268 |
|
|
|
3,206 |
|
Loans and leases |
|
|
1,565,811 |
|
|
|
1,464,855 |
|
Allowance for loan losses |
|
|
(17,149 |
) |
|
|
(15,624 |
) |
Premises and equipment, net |
|
|
31,307 |
|
|
|
29,310 |
|
Life insurance cash surrender value |
|
|
54,035 |
|
|
|
52,745 |
|
Goodwill and core deposit intangible |
|
|
21,168 |
|
|
|
21,570 |
|
Other assets |
|
|
45,235 |
|
|
|
27,185 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
2,378,372 |
|
|
$ |
2,419,104 |
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Non-interest-bearing deposits |
|
$ |
602,608 |
|
|
$ |
590,283 |
|
Interest-bearing deposits |
|
|
1,564,305 |
|
|
|
1,579,582 |
|
Total deposits |
|
|
2,166,913 |
|
|
|
2,169,865 |
|
Short-term borrowings |
|
|
12,940 |
|
|
|
- |
|
Secured borrowings |
|
|
7,619 |
|
|
|
10,620 |
|
Other liabilities |
|
|
27,950 |
|
|
|
26,890 |
|
Total liabilities |
|
|
2,215,422 |
|
|
|
2,207,375 |
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
162,950 |
|
|
|
211,729 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders’ equity |
|
$ |
2,378,372 |
|
|
$ |
2,419,104 |
|
|
|
|
|
|
|
|
|
|
Average Year-To-Date Balances: |
|
December 31, 2022 |
|
|
December 31, 2021 |
|
Assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
81,532 |
|
|
$ |
146,986 |
|
Investment securities |
|
|
684,588 |
|
|
|
568,785 |
|
Restricted investments in bank stock |
|
|
3,565 |
|
|
|
3,181 |
|
Loans and leases |
|
|
1,500,796 |
|
|
|
1,299,960 |
|
Allowance for loan losses |
|
|
(16,612 |
) |
|
|
(16,100 |
) |
Premises and equipment, net |
|
|
30,640 |
|
|
|
28,956 |
|
Life insurance cash surrender value |
|
|
53,443 |
|
|
|
48,570 |
|
Goodwill and core deposit intangible |
|
|
21,359 |
|
|
|
12,180 |
|
Other assets |
|
|
40,265 |
|
|
|
23,069 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
2,399,576 |
|
|
$ |
2,115,587 |
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Non-interest-bearing deposits |
|
$ |
594,541 |
|
|
$ |
517,599 |
|
Interest-bearing deposits |
|
|
1,593,805 |
|
|
|
1,376,364 |
|
Total deposits |
|
|
2,188,346 |
|
|
|
1,893,963 |
|
Short-term borrowings |
|
|
1,031 |
|
|
|
97 |
|
Secured borrowings |
|
|
8,886 |
|
|
|
9,122 |
|
FHLB advances |
|
|
- |
|
|
|
848 |
|
Other liabilities |
|
|
28,434 |
|
|
|
22,322 |
|
Total liabilities |
|
|
2,226,697 |
|
|
|
1,926,352 |
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
172,879 |
|
|
|
189,235 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders’ equity |
|
$ |
2,399,576 |
|
|
$ |
2,115,587 |
|
|
|
|
|
|
|
|
|
|
FIDELITY D & D BANCORP,
INC.Unaudited Condensed Consolidated Statements of
Income(dollars in thousands)
|
|
Three Months Ended |
|
|
Years ended |
|
|
|
Dec. 31, 2022 |
|
Dec. 31, 2021 |
|
Dec. 31, 2022 |
|
Dec. 31, 2021 |
Interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and leases |
|
$ |
17,425 |
|
|
$ |
15,614 |
|
|
$ |
64,020 |
|
|
$ |
55,431 |
|
Securities and other |
|
|
3,869 |
|
|
|
3,174 |
|
|
|
14,652 |
|
|
|
10,037 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest income |
|
|
21,294 |
|
|
|
18,788 |
|
|
|
78,672 |
|
|
|
65,468 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
(2,822 |
) |
|
|
(873 |
) |
|
|
(6,144 |
) |
|
|
(3,456 |
) |
Borrowings and debt |
|
|
(145 |
) |
|
|
(37 |
) |
|
|
(254 |
) |
|
|
(183 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest expense |
|
|
(2,967 |
) |
|
|
(910 |
) |
|
|
(6,398 |
) |
|
|
(3,639 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
18,327 |
|
|
|
17,878 |
|
|
|
72,274 |
|
|
|
61,829 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for loan losses |
|
|
(525 |
) |
|
|
(450 |
) |
|
|
(2,100 |
) |
|
|
(2,000 |
) |
Non-interest income |
|
|
3,920 |
|
|
|
4,185 |
|
|
|
16,642 |
|
|
|
18,287 |
|
Non-interest expense |
|
|
(12,865 |
) |
|
|
(12,614 |
) |
|
|
(51,348 |
) |
|
|
(50,107 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
8,857 |
|
|
|
8,999 |
|
|
|
35,468 |
|
|
|
28,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
(1,711 |
) |
|
|
(1,213 |
) |
|
|
(5,447 |
) |
|
|
(4,001 |
) |
Net income |
|
$ |
7,146 |
|
|
$ |
7,786 |
|
|
$ |
30,021 |
|
|
$ |
24,008 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
Dec. 31, 2022 |
|
Sep. 30, 2022 |
|
Jun. 30, 2022 |
|
Mar. 31, 2022 |
|
Dec. 31, 2021 |
Interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and leases |
|
$ |
17,425 |
|
|
$ |
16,320 |
|
|
$ |
15,500 |
|
|
$ |
14,775 |
|
|
$ |
15,614 |
|
Securities and other |
|
|
3,869 |
|
|
|
3,815 |
|
|
|
3,565 |
|
|
|
3,403 |
|
|
|
3,174 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest income |
|
|
21,294 |
|
|
|
20,135 |
|
|
|
19,065 |
|
|
|
18,178 |
|
|
|
18,788 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
(2,822 |
) |
|
|
(1,550 |
) |
|
|
(950 |
) |
|
|
(822 |
) |
|
|
(873 |
) |
Borrowings and debt |
|
|
(145 |
) |
|
|
(75 |
) |
|
|
30 |
|
|
|
(65 |
) |
|
|
(37 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest expense |
|
|
(2,967 |
) |
|
|
(1,625 |
) |
|
|
(920 |
) |
|
|
(887 |
) |
|
|
(910 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
18,327 |
|
|
|
18,510 |
|
|
|
18,145 |
|
|
|
17,291 |
|
|
|
17,878 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for loan losses |
|
|
(525 |
) |
|
|
(525 |
) |
|
|
(525 |
) |
|
|
(525 |
) |
|
|
(450 |
) |
Non-interest income |
|
|
3,920 |
|
|
|
3,911 |
|
|
|
4,256 |
|
|
|
4,554 |
|
|
|
4,185 |
|
Non-interest expense |
|
|
(12,865 |
) |
|
|
(13,028 |
) |
|
|
(12,800 |
) |
|
|
(12,654 |
) |
|
|
(12,614 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
8,857 |
|
|
|
8,868 |
|
|
|
9,076 |
|
|
|
8,666 |
|
|
|
8,999 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
(1,711 |
) |
|
|
(1,179 |
) |
|
|
(1,412 |
) |
|
|
(1,144 |
) |
|
|
(1,213 |
) |
Net income |
|
$ |
7,146 |
|
|
$ |
7,689 |
|
|
$ |
7,664 |
|
|
$ |
7,522 |
|
|
$ |
7,786 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FIDELITY D & D BANCORP,
INC.Unaudited Condensed Consolidated Balance
Sheets(dollars in thousands)
At Period End: |
|
Dec. 31, 2022 |
|
Sep. 30, 2022 |
|
Jun. 30, 2022 |
|
Mar. 31, 2022 |
|
Dec. 31, 2021 |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
29,091 |
|
|
$ |
134,042 |
|
|
$ |
109,125 |
|
|
$ |
97,403 |
|
|
$ |
96,877 |
|
Investment securities |
|
|
643,606 |
|
|
|
635,787 |
|
|
|
674,833 |
|
|
|
711,583 |
|
|
|
738,980 |
|
Restricted investments in bank stock |
|
|
5,268 |
|
|
|
3,639 |
|
|
|
3,622 |
|
|
|
3,231 |
|
|
|
3,206 |
|
Loans and leases |
|
|
1,565,811 |
|
|
|
1,524,328 |
|
|
|
1,494,316 |
|
|
|
1,479,114 |
|
|
|
1,464,855 |
|
Allowance for loan losses |
|
|
(17,149 |
) |
|
|
(16,779 |
) |
|
|
(16,590 |
) |
|
|
(16,081 |
) |
|
|
(15,624 |
) |
Premises and equipment, net |
|
|
31,307 |
|
|
|
30,971 |
|
|
|
30,855 |
|
|
|
31,336 |
|
|
|
29,310 |
|
Life insurance cash surrender value |
|
|
54,035 |
|
|
|
53,711 |
|
|
|
53,383 |
|
|
|
53,065 |
|
|
|
52,745 |
|
Goodwill and core deposit intangible |
|
|
21,168 |
|
|
|
21,264 |
|
|
|
21,360 |
|
|
|
21,462 |
|
|
|
21,570 |
|
Other assets |
|
|
45,235 |
|
|
|
48,805 |
|
|
|
44,036 |
|
|
|
39,661 |
|
|
|
27,185 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
2,378,372 |
|
|
$ |
2,435,768 |
|
|
$ |
2,414,940 |
|
|
$ |
2,420,774 |
|
|
$ |
2,419,104 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing deposits |
|
$ |
602,608 |
|
|
$ |
616,844 |
|
|
$ |
610,987 |
|
|
$ |
599,497 |
|
|
$ |
590,283 |
|
Interest-bearing deposits |
|
|
1,564,305 |
|
|
|
1,636,389 |
|
|
|
1,606,637 |
|
|
|
1,610,508 |
|
|
|
1,579,582 |
|
Total deposits |
|
|
2,166,913 |
|
|
|
2,253,233 |
|
|
|
2,217,624 |
|
|
|
2,210,005 |
|
|
|
2,169,865 |
|
Short-term borrowings |
|
|
12,940 |
|
|
|
10 |
|
|
|
10 |
|
|
|
- |
|
|
|
- |
|
Secured borrowings |
|
|
7,619 |
|
|
|
7,688 |
|
|
|
7,736 |
|
|
|
10,572 |
|
|
|
10,620 |
|
Other liabilities |
|
|
27,950 |
|
|
|
28,350 |
|
|
|
26,951 |
|
|
|
24,954 |
|
|
|
26,890 |
|
Total liabilities |
|
|
2,215,422 |
|
|
|
2,289,281 |
|
|
|
2,252,321 |
|
|
|
2,245,531 |
|
|
|
2,207,375 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
162,950 |
|
|
|
146,487 |
|
|
|
162,619 |
|
|
|
175,243 |
|
|
|
211,729 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders’ equity |
|
$ |
2,378,372 |
|
|
$ |
2,435,768 |
|
|
$ |
2,414,940 |
|
|
$ |
2,420,774 |
|
|
$ |
2,419,104 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Quarterly Balances: |
|
Dec. 31, 2022 |
|
Sep. 30, 2022 |
|
Jun. 30, 2022 |
|
Mar. 31, 2022 |
|
Dec. 31, 2021 |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
73,023 |
|
|
$ |
88,863 |
|
|
$ |
69,086 |
|
|
$ |
95,319 |
|
|
$ |
117,746 |
|
Investment securities |
|
|
637,825 |
|
|
|
672,595 |
|
|
|
693,121 |
|
|
|
736,021 |
|
|
|
725,977 |
|
Restricted investments in bank stock |
|
|
3,840 |
|
|
|
3,645 |
|
|
|
3,538 |
|
|
|
3,228 |
|
|
|
3,246 |
|
Loans and leases |
|
|
1,540,999 |
|
|
|
1,511,268 |
|
|
|
1,482,629 |
|
|
|
1,467,362 |
|
|
|
1,452,676 |
|
Allowance for loan losses |
|
|
(17,113 |
) |
|
|
(16,911 |
) |
|
|
(16,441 |
) |
|
|
(15,966 |
) |
|
|
(15,857 |
) |
Premises and equipment, net |
|
|
31,190 |
|
|
|
30,956 |
|
|
|
31,091 |
|
|
|
29,301 |
|
|
|
29,399 |
|
Life insurance cash surrender value |
|
|
53,925 |
|
|
|
53,599 |
|
|
|
53,277 |
|
|
|
52,960 |
|
|
|
52,635 |
|
Goodwill and core deposit intangible |
|
|
21,210 |
|
|
|
21,308 |
|
|
|
21,405 |
|
|
|
21,517 |
|
|
|
21,632 |
|
Other assets |
|
|
47,714 |
|
|
|
42,564 |
|
|
|
40,878 |
|
|
|
29,679 |
|
|
|
26,679 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
2,392,614 |
|
|
$ |
2,407,887 |
|
|
$ |
2,378,584 |
|
|
$ |
2,419,421 |
|
|
$ |
2,414,133 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing deposits |
|
$ |
609,262 |
|
|
$ |
589,227 |
|
|
$ |
593,121 |
|
|
$ |
586,363 |
|
|
$ |
585,899 |
|
Interest-bearing deposits |
|
|
1,589,129 |
|
|
|
1,614,573 |
|
|
|
1,579,150 |
|
|
|
1,592,173 |
|
|
|
1,575,844 |
|
Total deposits |
|
|
2,198,391 |
|
|
|
2,203,800 |
|
|
|
2,172,271 |
|
|
|
2,178,536 |
|
|
|
2,161,743 |
|
Short-term borrowings |
|
|
3,875 |
|
|
|
10 |
|
|
|
206 |
|
|
|
- |
|
|
|
- |
|
Secured borrowings |
|
|
7,654 |
|
|
|
7,707 |
|
|
|
9,644 |
|
|
|
10,584 |
|
|
|
16,053 |
|
Other liabilities |
|
|
30,489 |
|
|
|
29,031 |
|
|
|
27,164 |
|
|
|
27,008 |
|
|
|
27,410 |
|
Total liabilities |
|
|
2,240,409 |
|
|
|
2,240,548 |
|
|
|
2,209,285 |
|
|
|
2,216,128 |
|
|
|
2,205,206 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
152,205 |
|
|
|
167,339 |
|
|
|
169,299 |
|
|
|
203,293 |
|
|
|
208,927 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders’ equity |
|
$ |
2,392,614 |
|
|
$ |
2,407,887 |
|
|
$ |
2,378,584 |
|
|
$ |
2,419,421 |
|
|
$ |
2,414,133 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FIDELITY D & D BANCORP,
INC.Selected Financial Ratios and Other
Financial Data
|
|
Three Months Ended |
|
|
|
Dec. 31, 2022 |
|
Sep. 30, 2022 |
|
Jun. 30, 2022 |
|
Mar. 31, 2022 |
|
Dec. 31, 2021 |
Selected returns and financial ratios |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
$ |
1.27 |
|
|
$ |
1.36 |
|
|
$ |
1.35 |
|
|
$ |
1.33 |
|
|
$ |
1.38 |
|
Diluted earnings per share |
|
$ |
1.26 |
|
|
$ |
1.36 |
|
|
$ |
1.35 |
|
|
$ |
1.32 |
|
|
$ |
1.37 |
|
Dividends per share |
|
$ |
0.36 |
|
|
$ |
0.33 |
|
|
$ |
0.33 |
|
|
$ |
0.33 |
|
|
$ |
0.33 |
|
Yield on interest-earning assets (FTE)* |
|
|
3.78 |
% |
|
|
3.60 |
% |
|
|
3.50 |
% |
|
|
3.34 |
% |
|
|
3.40 |
% |
Cost of interest-bearing liabilities |
|
|
0.74 |
% |
|
|
0.40 |
% |
|
|
0.23 |
% |
|
|
0.22 |
% |
|
|
0.23 |
% |
Cost of funds |
|
|
0.53 |
% |
|
|
0.29 |
% |
|
|
0.17 |
% |
|
|
0.16 |
% |
|
|
0.17 |
% |
Net interest spread (FTE)* |
|
|
3.04 |
% |
|
|
3.20 |
% |
|
|
3.27 |
% |
|
|
3.12 |
% |
|
|
3.17 |
% |
Net interest margin (FTE)* |
|
|
3.27 |
% |
|
|
3.32 |
% |
|
|
3.34 |
% |
|
|
3.18 |
% |
|
|
3.24 |
% |
Return on average assets |
|
|
1.18 |
% |
|
|
1.27 |
% |
|
|
1.29 |
% |
|
|
1.26 |
% |
|
|
1.28 |
% |
Return on average equity |
|
|
18.63 |
% |
|
|
18.23 |
% |
|
|
18.16 |
% |
|
|
15.01 |
% |
|
|
14.79 |
% |
Return on average tangible equity* |
|
|
21.64 |
% |
|
|
20.89 |
% |
|
|
20.79 |
% |
|
|
16.78 |
% |
|
|
16.49 |
% |
Efficiency ratio (FTE)* |
|
|
56.06 |
% |
|
|
56.38 |
% |
|
|
55.45 |
% |
|
|
56.21 |
% |
|
|
55.52 |
% |
Expense ratio |
|
|
1.48 |
% |
|
|
1.51 |
% |
|
|
1.44 |
% |
|
|
1.36 |
% |
|
|
1.38 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years ended |
|
|
|
Dec. 31, 2022 |
|
Dec. 31, 2021 |
Basic earnings per share |
|
$ |
5.32 |
|
|
$ |
4.51 |
|
Diluted earnings per share |
|
$ |
5.29 |
|
|
$ |
4.48 |
|
Dividends per share |
|
$ |
1.35 |
|
|
$ |
1.23 |
|
Yield on interest-earning assets (FTE)* |
|
|
3.56 |
% |
|
|
3.42 |
% |
Cost of interest-bearing liabilities |
|
|
0.40 |
% |
|
|
0.26 |
% |
Cost of funds |
|
|
0.29 |
% |
|
|
0.19 |
% |
Net interest spread (FTE)* |
|
|
3.16 |
% |
|
|
3.16 |
% |
Net interest margin (FTE)* |
|
|
3.28 |
% |
|
|
3.23 |
% |
Return on average assets |
|
|
1.25 |
% |
|
|
1.13 |
% |
Return on average equity |
|
|
17.37 |
% |
|
|
12.69 |
% |
Return on average tangible equity* |
|
|
19.81 |
% |
|
|
13.56 |
% |
Efficiency ratio (FTE)* |
|
|
56.02 |
% |
|
|
60.92 |
% |
Expense ratio |
|
|
1.45 |
% |
|
|
1.50 |
% |
|
|
|
|
|
|
|
|
|
Non-GAAP Measures |
|
Three Months Ended |
|
|
Years ended |
|
(dollars in thousands except per share data) |
|
Dec. 31, 2022 |
|
Dec. 31, 2021 |
|
Dec. 31, 2022 |
|
Dec. 31, 2021 |
Net income |
|
$ |
7,146 |
|
|
$ |
7,786 |
|
|
$ |
30,021 |
|
|
$ |
24,008 |
|
Merger-related expenses, net
of income taxes |
|
|
- |
|
|
|
(87 |
) |
|
|
- |
|
|
|
2,542 |
|
FHLB
prepayment penalty, net of income taxes |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
291 |
|
Adjusted net income* |
|
$ |
7,146 |
|
|
$ |
7,699 |
|
|
$ |
30,021 |
|
|
$ |
26,841 |
|
Adjusted basic earnings per
share* |
|
$ |
1.27 |
|
|
$ |
1.36 |
|
|
$ |
5.32 |
|
|
$ |
5.04 |
|
Adjusted diluted earnings per
share* |
|
$ |
1.26 |
|
|
$ |
1.35 |
|
|
$ |
5.29 |
|
|
$ |
5.00 |
|
Interest income adjustment to
FTE* |
|
$ |
700 |
|
|
$ |
655 |
|
|
$ |
2,738 |
|
|
$ |
2,135 |
|
Adjusted return on average
assets* |
|
|
1.18 |
% |
|
|
1.27 |
% |
|
|
1.25 |
% |
|
|
1.27 |
% |
Adjusted return on average
tangible equity* |
|
|
21.64 |
% |
|
|
16.31 |
% |
|
|
19.81 |
% |
|
|
15.16 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial data |
|
At period end: |
|
(dollars in thousands except per share data) |
|
Dec. 31, 2022 |
|
Sep. 30, 2022 |
|
Jun. 30, 2022 |
|
Mar. 31, 2022 |
|
Dec. 31, 2021 |
Book value per share |
|
$ |
28.94 |
|
|
$ |
26.02 |
|
|
$ |
28.77 |
|
|
$ |
30.97 |
|
|
$ |
37.50 |
|
Tangible book value per share* |
|
$ |
25.18 |
|
|
$ |
22.24 |
|
|
$ |
24.99 |
|
|
$ |
27.17 |
|
|
$ |
33.68 |
|
Equity to assets |
|
|
6.85 |
% |
|
|
6.01 |
% |
|
|
6.73 |
% |
|
|
7.24 |
% |
|
|
8.75 |
% |
Allowance for loan losses to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans |
|
|
1.10 |
% |
|
|
1.10 |
% |
|
|
1.11 |
% |
|
|
1.09 |
% |
|
|
1.09 |
% |
Non-accrual loans |
|
6.77x |
|
|
5.23x |
|
|
5.17x |
|
|
6.97x |
|
|
5.30x |
|
Non-accrual loans to total loans |
|
|
0.16 |
% |
|
|
0.20 |
% |
|
|
0.21 |
% |
|
|
0.16 |
% |
|
|
0.20 |
% |
Non-performing assets to total assets |
|
|
0.17 |
% |
|
|
0.19 |
% |
|
|
0.20 |
% |
|
|
0.17 |
% |
|
|
0.27 |
% |
Net charge-offs to average total loans |
|
|
0.04 |
% |
|
|
0.04 |
% |
|
|
0.01 |
% |
|
|
0.02 |
% |
|
|
0.04 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Adequacy Ratios |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total risk-based capital
ratio |
|
|
14.35 |
% |
|
|
14.34 |
% |
|
|
14.30 |
% |
|
|
14.18 |
% |
|
|
14.51 |
% |
Common equity tier 1
risk-based capital ratio |
|
|
13.27 |
% |
|
|
13.27 |
% |
|
|
13.21 |
% |
|
|
13.11 |
% |
|
|
13.40 |
% |
Tier 1 risk-based capital
ratio |
|
|
13.27 |
% |
|
|
13.27 |
% |
|
|
13.21 |
% |
|
|
13.11 |
% |
|
|
13.40 |
% |
Leverage ratio |
|
|
8.69 |
% |
|
|
8.51 |
% |
|
|
8.43 |
% |
|
|
8.14 |
% |
|
|
7.94 |
% |
* See non-GAAP Financial Measures above.
Contacts:
Daniel J. Santaniello |
Salvatore R. DeFrancesco,
Jr. |
President and Chief Executive
Officer |
Treasurer and Chief
Financial Officer |
570-504-8035 |
570-504-8000 |
Grafico Azioni Fidelity D and D Bancorp (NASDAQ:FDBC)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Fidelity D and D Bancorp (NASDAQ:FDBC)
Storico
Da Giu 2023 a Giu 2024