WALDORF, Md., July 25, 2022 (GLOBE NEWSWIRE) --
The Community Financial Corporation (NASDAQ: TCFC) (the “Company”),
the holding company for Community Bank of the Chesapeake (the
“Bank”), today reported record net income for the three months
ended June 30, 2022 of $6.8 million, or $1.21 per diluted
common share. This compares to net income of $6.3 million, or $1.10
per diluted common share for the first quarter of 2022, and net
income of $6.4 million or $1.10 per diluted common share for the
quarter ended June 30, 2021. The Company reported record net
income for the six months ended June 30, 2022 of $13.1 million
or diluted earnings per share of $2.31 compared to net income for
the comparable 2021 period of $12.7 million or diluted earnings per
share of $2.17.
Second Quarter 2022
Highlights
-
Record Net Income: Net income totaled $6.8 million
for the quarter ended June 30, 2022, or $1.21 per diluted
common share compared to net income of $6.4 million or $1.10 per
diluted common share for the quarter ended June 30, 2021 and
$6.3 million or $1.10 per diluted common share for the quarter
ended March 31, 2022.
-
Consistent Profitability: Return on average assets
("ROAA"), return on average common equity ("ROACE") and return on
average tangible common equity ("ROATCE") were 1.19%, 14.39% and
15.50% for the three months ended June 30, 2022 compared to
1.22%, 12.62% and 13.62% for the three months ended June 30,
2021. ROAA, ROACE and ROATCE were 1.08%, 12.30% and 13.22% for the
three months ended March 31, 2022.
-
Expanding Net Interest Margin: Net interest margin
increased to 3.25% for the three months ended June 30, 2022
from 3.12% for the first quarter of 2022. Loan and overall
interest-earning asset yields increased 14 and 20 basis points to
4.13% and 3.48% in the second quarter of 2022 from 3.99% and 3.28%
in the three months ended March 31, 2022. The Company's cost
of funds increased six basis points for the comparable three month
period from 0.17% to 0.23%.
-
Positioned for Rising Rates:
-
Increasing Loan Yields:
End of period contractual rates increased by 20 basis points to
4.05% at June 30, 2022 compared to March 31, 2022. The
loan portfolio is positioned for rising rates with $481.5 million
or 29% of net portfolio loans scheduled to reprice monthly or in
the next three months and an additional $53.1 million or 3%
repricing in the following nine months. The Bank's effective
duration on the loan portfolio was 2.1 years at June 30,
2022.
-
Improved Deposit
Franchise: Focused efforts have
increased non-interest-bearing accounts to 30.5% of deposits at
June 30, 2022 from 22.2% of deposits at June 30,
2021.
-
Market Share Gains Delivered Loan Growth: Total
portfolio loans increased to $1,652.5 million, an increase of $22.9
million or 5.6% annualized, compared to the prior quarter, and
$73.6 million or 9.3% annualized, from December 31, 2021, as
the Company continued to gain market share in Virginia. The loan
pipeline at June 30, 2022 was $166.0 million, which is
expected to provide solid loan growth in the third quarter.
-
Improving Asset Quality: Non-accrual loans, OREO
and TDRs were $6.7 million or 0.29% of total assets at
June 30, 2022 compared to $7.9 million or 0.34% of total
assets at March 31, 2022, and $15.8 million or 0.72% at
June 30, 2021.
-
Proactive Compensation Adjustments to Attract and Retain
Employees: In May of 2022, management approved a 4% base
compensation increase for non-executive employees to attract and
retain employees. The Bank also increased its minimum starting wage
from $17.00 per hour to $20.00 per hour. Management expects total
noninterest expenses of $9.6 million to $9.7 million for
the third quarter of 2022.
- Continued Virginia
Expansion: The Bank opened its second Virginia branch in
May 2022 in Fredericksburg. Additionally, with our Virginia lending
team managing approximately 50% of the Bank's loans, the Bank
intends to open a loan production office in Charlottesville in the
fourth quarter of 2022 to support our existing efforts there.
Management
Commentary
"I’m very proud of what we’ve accomplished and
the bank we’ve built over the past eight years since I was named as
CEO,” stated William J. Pasenelli, Chief Executive Officer. “We
have built on our position as the leading community bank in
Southern Maryland to profitably grow assets, improve our deposit
franchise and expand into Virginia. Our success reflects our
unwavering commitment to serve the financial needs of the
communities in which we live and work. I am confident that
Community Bank of the Chesapeake’s best days are ahead.”
"Net interest income increased $1.1 million to
$17.6 million during the second quarter as loan growth combined
with increasing yields and stable funding costs. Net interest
margin for the period increased 13 basis points and should see
further improvement as a large percentage of our loans should
reprice upwards over the next few months,” stated James M. Burke,
President. "We remain focused on delivering results to our
communities, customers, employees and shareholders. Our asset
sensitivity, low-cost deposit franchise, solid loan growth and
continued cost discipline should position the Company
to improve our profitability in the second half of the
year."
“Also during the second quarter, we supported
our most important asset – our employees – as we approved a 4%
increase to base compensation and increased our minimum hourly wage
to $20.00. We have a great team and our increased performance over
the last several years is due to their execution of our strategic
plan. It is critically important to continue to attract and retain
the best and brightest employees, and these compensation actions
recognized the impact inflation is having on their daily lives,”
continued Burke. “Our employees are exceptionally efficient with
the support of innovative technology, and we are optimistic that
our commitment to them will continue to drive increasing
profitability."
Results of Operations
|
|
(UNAUDITED) |
|
|
|
|
|
|
Three Months Ended June 30, |
|
|
|
|
(dollars in thousands) |
|
|
2022 |
|
|
2021 |
|
$ Change |
|
% Change |
Interest and dividend income |
|
$ |
18,774 |
|
$ |
17,444 |
|
$ |
1,330 |
|
|
7.6 |
% |
Interest expense |
|
|
1,206 |
|
|
1,009 |
|
|
197 |
|
|
19.5 |
% |
Net interest income |
|
|
17,568 |
|
|
16,435 |
|
|
1,133 |
|
|
6.9 |
% |
Provision for credit
losses |
|
|
425 |
|
|
291 |
|
|
134 |
|
|
46.0 |
% |
Provision for unfunded
commitments |
|
|
26 |
|
|
— |
|
|
26 |
|
|
0.0 |
% |
Noninterest income |
|
|
1,424 |
|
|
1,856 |
|
|
(432 |
) |
|
(23.3 |
)% |
Noninterest expense |
|
|
9,338 |
|
|
9,378 |
|
|
(40 |
) |
|
(0.4 |
)% |
Income before income
taxes |
|
|
9,203 |
|
|
8,622 |
|
|
607 |
|
|
7.0 |
% |
Income tax expense |
|
|
2,369 |
|
|
2,190 |
|
|
179 |
|
|
8.2 |
% |
Net income |
|
$ |
6,834 |
|
$ |
6,432 |
|
$ |
428 |
|
|
6.7 |
% |
|
|
(UNAUDITED) |
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
|
(dollars in thousands) |
|
|
2022 |
|
|
|
2021 |
|
$ Change |
|
% Change |
Interest and dividend income |
|
$ |
36,110 |
|
|
$ |
35,122 |
|
$ |
988 |
|
|
2.8 |
% |
Interest expense |
|
|
2,073 |
|
|
|
2,178 |
|
|
(105 |
) |
|
(4.8 |
)% |
Net interest income |
|
|
34,037 |
|
|
|
32,944 |
|
|
1,093 |
|
|
3.3 |
% |
Provision for credit
losses |
|
|
875 |
|
|
|
586 |
|
|
289 |
|
|
49.3 |
% |
Recovery for unfunded
commitments |
|
|
(5 |
) |
|
|
— |
|
|
(5 |
) |
|
— |
% |
Noninterest income |
|
|
2,875 |
|
|
|
4,216 |
|
|
(1,341 |
) |
|
(31.8 |
)% |
Noninterest expense |
|
|
18,418 |
|
|
|
19,526 |
|
|
(1,108 |
) |
|
(5.7 |
)% |
Income before income
taxes |
|
|
17,624 |
|
|
|
17,048 |
|
|
571 |
|
|
3.3 |
% |
Income tax expense |
|
|
4,502 |
|
|
|
4,317 |
|
|
185 |
|
|
4.3 |
% |
Net income |
|
$ |
13,122 |
|
|
$ |
12,731 |
|
$ |
386 |
|
|
3.0 |
% |
|
Net Interest
Income
Net interest income for the comparable quarters
increased primarily from growth in investments and increases in
interest-earning asset yields partially offset by increased
interest expense from higher funding volume. Net interest margin of
3.25% for the three months ended June 30,
2022 decreased 12 basis points from 3.37% for the
three months ended June 30, 2021 and increased 13 basis
points from 3.12% for the three months ended March 31, 2022.
Net interest margin expanded during the second quarter of 2022,
primarily due to average yields on loans and investments increasing
to 4.13% and 1.52% for the three months ended June 30, 2022
from 3.99% and 1.33% for the three months ended March 31,
2022. Interest income from the Company's participation in the U.S.
SBA PPP program was $0.3 million and $1.3 million for the three
months ended June 30, 2022 and June 30, 2021,
respectively and $0.5 million for the three months ended
March 31, 2022.
Net interest income increased for the six months
ended June 30, 2022 compared to the six months ended
June 30, 2021 due primarily to growth in investments partially
offset by decreased interest expense from lower long-term funding
volume. Loan interest income decreased $0.5 million to $32.4
million for the six months ended June 30, 2022 from $32.9
million for the three months ended June 30,
2021. Excluding U.S. SBA PPP loan interest income for the same
comparable periods increased $1.8 million to
$31.6 million from $29.8 million. Net interest margin of
3.19% for the six months ended June 30, 2022 was 24 basis
points lower than the 3.43% for the six months ended June 30,
2021. U.S. SBA PPP loan interest positively impacted margins by
five basis points for the six months ended June 30, 2022
and 13 basis points for the six months ended June 30,
2021.
The Company’s cost of funds was 0.23% during the
second quarter of 2022 compared to 0.17% for the prior quarter and
increased from 0.21% for the three months ended June 30, 2021.
The Bank's interest rate asset sensitivity improved as average
non-interest bearing deposit accounts increased to 31.8% of total
average deposits for the second quarter of 2022 compared to 22.1%
for the comparable period in 2021 and 29.6% for the previous
quarter. Management is optimistic that improvements in the Bank's
funding composition will benefit margins and profitability in an
increasing interest-rate environment. The Company’s cost of funds
was 0.20% during the first six months of 2022 compared to 0.23% for
the six months ended June 30, 2021.
Noninterest Income
The $0.4 million decrease in noninterest income
in the current quarter was principally due to no interest rate
protection referral fee income compared to $0.6 million for the
three months ended June 30, 2021. In addition, changes in
interest rates resulted in $0.2 million of unrealized losses on
securities invested in a Community Reinvestment Act mutual fund
which contributed to the overall decrease. These reductions in
noninterest income for the comparable quarters were partially
offset by increases in service charges of $0.2 million due to
increased interchange fees and gains of $0.2 million from the sale
of two impaired loans. Noninterest income as a percentage of
average assets was 0.25% and 0.35%, respectively, for the three
months ended June 30, 2022 and 2021.
The $1.3 million decrease in noninterest income
for the six months ended June 30, 2022 compared to the same
period in the prior year was principally due to reductions in
interest rate protection referral fee income of $0.7 million,
$0.6 million in gains on the sale of investment securities
sold in the first six months of 2021 and $0.3 million in
unrealized losses on securities invested in a Community
Reinvestment Act mutual fund in the first six months of 2022 due to
changes in interest rates. These reductions for the comparable
periods were partially offset by $0.4 million related to the sale
of impaired loans. In the first quarter of 2021, the Bank sold
non-accrual and classified commercial real estate and residential
mortgage loans and recognized a loss on the sale of
$0.2 million and in the second quarter of 2022, impaired loan
sales resulted in a gain of $0.2 million. Noninterest income as a
percentage of assets was 0.25% and 0.40%, respectively, for the six
months ended June 30, 2022 and 2021.
Noninterest
Expense
Noninterest expense of $9.3 million for the
three months ended June 30, 2022 decreased $40,000 or 0.4%
compared to the three months ended June 30, 2021. The flat
overall expense run rate for the comparable periods were primarily
due to decreases of $0.3 million in compensation and benefits
and $0.5 million in OREO expenses, partially offset by
increases of $0.1 million in occupancy expenses and
$0.2 million in professional fees as well as a fraud recovery
of $0.2 million in the second quarter of 2021.
Noninterest expense of $18.4 million decreased
$1.1 million or 5.7% for the six months ended June 30, 2022
compared to the six months ended June 30, 2021. The decrease
in noninterest expense for the comparable periods was primarily due
to decreases in fraud losses of $1.0 million and
$0.7 million in OREO expenses. If the allocation of deferred
costs for U.S. SBA PPP loans originated were included in
noninterest expense for the six months ended June 30, 2021,
compensation and benefits and the overall variance in expenses
would increase by $0.3 million. These decreases to noninterest
expense were partially offset by increases in professional fees of
$0.3 million and $0.1 million in occupancy expense.
Noninterest expense in the first six months of 2021 included a
$1.3 million initial expense and subsequent recovery of
$0.2 million related to an isolated wire transfer fraud
incident. Our investigation determined that no information systems
of the Bank were compromised, and no employee fraud was involved.
OREO expenses have moderated as the Bank has been successful at
disposing foreclosed assets over the last two years, which have
been reduced from $1.5 million at June 30, 2021 to no
OREO assets at June 30, 2022. Excluding the impact of the
$1.1 million isolated fraud losses and the $0.3 million
in U.S. SBA PPP deferred costs, the Company's noninterest expense
was $18.7 million for the six months ended June 30,
2021.
Lower than anticipated health care costs and a
lower average full-time equivalent headcount contributed to a lower
expense run rate in the first six months of 2022. In addition,
compensation and benefits expense has benefited from the Company's
increased use of technology. In the second quarter, the Bank
increased base compensation by 4% and its minimum starting wage to
$20.00 per hour for non-executive employees to address local wage
pressures caused by inflation and to attract and retain our
employees. Management's projected quarterly expense run rate for
the third quarter of 2022 is estimated between $9.6 million
and $9.7 million and includes consideration of the base
compensation increases and an average FTE count of 195-197
employees.
The Company’s efficiency ratio was 49.17% and
49.90% for the three and six months ended June 30, 2022
compared to 51.27% and 52.55% for the three and six months ended
June 30, 2021. The Company’s net operating expense ratio was
1.38% and 1.35% for the three and six months ended June 30,
2022 compared to 1.42% and 1.46% for the three and six months ended
June 30, 2021. The efficiency and net operating expense ratios
have improved (decreased) as the Company has been able to improve
asset quality and generate more operating revenues while
controlling expense growth.
Income Tax Expense
The effective tax rate for the three months
ended June 30, 2022 was 25.74% compared to an effective tax
rate of 25.40% for the three months ended June 30, 2021. The
effective tax rate for the six months ended June 30, 2022 was
25.54% compared to an effective tax rate of 25.32% for the six
months ended June 30, 2021.
Balance Sheet
Assets
Total assets decreased $3.8 million, or 0.2%, to
$2.32 billion at June 30, 2022 compared to total assets of
$2.33 billion at December 31, 2021. Cash decreased a net of
$51.5 million and was used to fund net loan growth of $49.3
million. In addition, deferred tax assets increased $11.2 million
to $20.2 million primarily due to the adoption of the current
expected credit losses ("CECL") accounting
standard on January 1, 2022 and increases in unrealized
losses of the Bank's AFS investment portfolio related to changes in
interest rates.
During the second quarter of 2022, total net
loans, which include portfolio loans and U.S. SBA PPP loans,
increased 3.1% annualized or $12.6 million from $1,623.4 million
at March 31, 2022 to $1,636.1 million at
June 30, 2022. Net portfolio loans increased 5.7%
annualized or $22.9 million from $1,608.2 million
at March 31, 2022 to $1,631.1 million at
June 30, 2022. Portfolio loans include all loan
portfolios except the U.S. SBA PPP loan portfolio. The
Company’s loan pipeline was $166.0 million
at June 30, 2022.
Non-owner occupied commercial real estate as a
percentage of risk-based capital at June 30, 2022 and
December 31, 2021 were $893.9 million or 351% and $813.0
million or 331%, respectively. Construction loans as a percentage
of risk-based capital at June 30, 2022 and December 31,
2021 were $133.1 million or 52% and $140.4 million or 57%,
respectively.
Funding
Total deposits increased $29.2 million
or 1.4% (2.8% annualized) at June 30, 2022 compared
to December 31, 2021. The increase included a $42.3 million
increase to transaction deposits offset by a $13.1 million decrease
to time deposits. During the first six months of 2022,
non-interest-bearing demand deposits increased $189.9 million to
$635.6 million at June 30, 2022, representing 30.5% of
deposits, compared to 21.7% of deposits at December 31,
2021. The Company's business development efforts continue to focus
on increasing non-interest bearing and lower cost transaction
accounts.
Stockholders' Equity and Regulatory
Capital
During the six months ended June 30, 2022,
total stockholders’ equity decreased $23.3 million. Equity
increased due to net income of $13.1 million and net stock related
activities in connection with stock-based compensation and ESOP
activity of $0.5 million. The decrease in equity was primarily due
to an increase of $29.9 million in accumulated other comprehensive
loss ("AOCL") in the Bank's AFS securities portfolio due to changes
in market interest rates. In addition, equity decreased for common
dividends paid of $1.9 million, stock repurchases of $3.0 million
and $2.0 million for the adoption of the CECL accounting standard
on January 1, 2022.
The Company's common equity to assets ratio
decreased to 7.96% at June 30, 2022 from 8.94%
at December 31, 2021. The Company’s ratio of
tangible common equity ("TCE") to tangible assets decreased to
7.49% at June 30, 2022 from 8.48%
at December 31, 2021 (see Non-GAAP reconciliation
schedules) due primarily to increases in AOCL. Regulatory capital
was not impacted by the increase in AOCL and Tier 1 capital to
average asset ratios at the Bank and the Company remained strong at
10.12% and 9.42% at June 30, 2022 compared to 9.95% and 9.23%
at December 31, 2021.
On December 9, 2021, the Company announced its
Board of Directors approved the resumption of repurchases allowed
under the stock repurchase plan originally adopted in October 2020
(the "2020 Repurchase Plan"). The Company was permitted to
repurchase up to the 99,450 shares remaining under the 2020
Repurchase Plan using up to $4.0 million in the aggregate and
up to $1.5 million in the aggregate on a quarterly basis.
During the second quarter of 2022, the Company repurchased 38,017
shares at an average price of $39.43 per share. At June 30,
2022 the Company had $0.6 million remaining under the
$4.0 million authorization and 13,647 shares available to be
repurchased under the 2020 Repurchase Plan.
Asset Quality
Allowance for credit losses ("ACL")
and provision for credit losses ("PCL"); Allowance for Loan Losses
("ALLL") and provision for loan losses
("PLL")1;
Classified and Non-Performing Assets
On January 1, 2022, the Company adopted ASU
2016-13, Financial Instruments - Credit Losses (Topic
326) - Measurement of Credit Losses on Financial Instruments,
which replaced the incurred loss methodology for determining our
ACL with an expected loss methodology that is referred to as the
CECL. The measurement of expected credit losses under the CECL
methodology applies to financial assets subject to credit losses
and measured at amortized cost, and certain off-balance sheet
credit exposures. This includes, but is not limited to, loans,
leases, held-to-maturity securities, loan commitments, and
financial guarantees. In addition, ASU 2016-13 made changes to the
accounting for available-for-sale ("AFS") debt securities. Credit-
related impairments on AFS debt securities are now recognized as an
allowance for credit loss rather than a write-down of the
securities' amortized cost basis when management does not intend to
sell or believes that it is not likely that they will be required
to sell the securities prior to recovery of the securities
amortized cost basis. We adopted ASU 2016-13 using the modified
retrospective method. Results for reporting periods beginning after
January 1, 2022 are presented under ASU 2016-13 while prior period
amounts continue to be reported in accordance with previously
applicable GAAP. At adoption, the Company did not hold Held to
Maturity ("HTM") investment debt securities.
The impact at adoption was an increase to the
ACL of $2.5 million, the recording of a reserve for unfunded
commitments of $0.2 million and a decrease in retained earnings of
$2.0 million.
ACL balances increased to 1.30% of portfolio
loans at June 30, 2022 compared to an ALLL of 1.17% of
portfolio loans at December 31, 2021. At and for the three
months ended June 30, 2022, the Company's ACL increased $3.0
million or 16.2% to $21.4 million at June 30, 2022 from $18.4
million at December 31, 2021. The Company recorded a $0.4
million and $0.9 million PCL for the three and six months ended
June 30, 2022 compared to a $0.3 million and $0.6 million PLL
for the three and six months ended June 30, 2021. There were
$0.4 million in net charge-offs during the six months ended
June 30, 2022 compared to $1.5 million in net charge-offs for
the six months ended June 30, 2021.
Management believes that the allowance is
adequate at June 30, 2022.
Classified assets increased $0.9 million from
$5.2 million at December 31, 2021 to $6.1 million
at June 30, 2022. Management considers classified
assets to be an important measure of asset quality. The Company's
risk rating process for classified loans is an important factor in
the Company's ACL qualitative framework. Management remains
committed to expeditiously resolving non-performing or substandard
credits that are not likely to become performing or passing credits
in a reasonable timeframe.
During 2021, classified assets decreased
$17.1 million. Asset quality improved with the resolution of
$16.9 million in non-accrual and impaired loans through loan
sales and negotiated payoffs, as well as the resolution of
$3.1 million in OREO. The Company's sale of impaired loans
decreased the specific reserve, improved asset quality, and
improved several ALLL qualitative factors.
The ratio of non-accrual loans and OREO to total
portfolio loans and OREO decreased 10 basis points from
0.48% at December 31, 2021 to 0.38%
at June 30, 2022. The ratio of non-accrual loans, OREO
and TDRs to total assets decreased six basis points
from 0.35% at December 31, 2021 to 0.29%
at June 30, 2022.
Non-accrual loans decreased $1.4 million from
$7.6 million at December 31, 2021 to $6.2 million at
June 30, 2022. There were no OREO balances at June 30,
2022 and December 31, 2021.
About The Community Financial
Corporation - Headquartered in Waldorf, MD, The Community
Financial Corporation is the bank holding company for Community
Bank of the Chesapeake, a full-service commercial bank with assets
of approximately $2.3 billion. Through its branch offices and
commercial lending centers, Community Bank of the Chesapeake offers
a broad range of financial products and services to individuals and
businesses. The Company’s branches are located at its main office
in Waldorf, Maryland, and branch offices in Bryans Road, Dunkirk,
Leonardtown, La Plata, Charlotte Hall, Prince Frederick, Lusby and
California, Maryland; and Fredericksburg - Downtown and
Fredericksburg - Harrison Crossing, Virginia. More information
about Community Bank of the Chesapeake can be found at
www.cbtc.com.
Use of non-GAAP Financial
Measures - Statements included in this press release
include non-GAAP financial measures and should be read along with
the accompanying tables, which provide a reconciliation of non-GAAP
financial measures to GAAP financial measures. The Company’s
management uses these non-GAAP financial measures, and believes
that non-GAAP financial measures provide additional useful
information that allows readers to evaluate the ongoing performance
of the Company. Non-GAAP financial measures should not be
considered as an alternative to any measure of performance or
financial condition as promulgated under GAAP, and investors should
consider the Company’s performance and financial condition as
reported under GAAP and all other relevant information when
assessing the performance or financial condition of the Company.
Non-GAAP financial measures have limitations as analytical tools,
and investors should not consider them in isolation or as a
substitute for analysis of the results or financial condition as
reported under GAAP.
Forward-looking Statements -
This news release contains forward-looking statements within the
meaning of the federal securities laws. Forward-looking statements
can generally be identified by the fact that they do not relate
strictly to historical or current facts. They often include words
like “believe,” “expect,” “anticipate,” “estimate”, “assume” and
“intend” or future or conditional verbs such as “will,” “would,”
“should,” “could” or “may.” Statements in this release that are not
strictly historical are forward-looking and are based upon current
expectations that may differ materially from actual results. These
forward-looking statements include, without limitation: (i) those
relating to the Company’s and the Bank’s future growth and
management’s outlook or expectations for revenue, assets, asset
quality, profitability, business prospects, net interest margin,
non-interest revenue, allowance for loan losses, the level of
credit losses from lending, liquidity levels, capital levels, or
other future financial or business performance strategies or
expectations; (ii) any statements of the plans and objectives of
management for future operations products or services, including
the expected benefits from, and/or the execution of integration
plans relating to any acquisition we have undertaken or that we
undertake in the future; (iii) plans and cost savings regarding
branch closings or consolidation; (iv) projections related to
certain financial metrics; (v) expected benefits of programs we
introduce, including residential mortgage programs and retail and
commercial credit card programs; and (vi) any statement of
expectation or belief, and any assumptions underlying the
foregoing. These forward-looking statements express management’s
current expectations or forecasts of future events, results and
conditions, and by their nature are subject to and involve risks
and uncertainties that could cause actual results to differ
materially from those anticipated by the statements made herein.
Factors that might cause actual results to differ materially from
those made in such statements include, but are not limited to: (i)
risks, uncertainties and other factors relating to the COVID-19
pandemic (including the length of time that the pandemic continues;
the ability of states and local governments to successfully
implement the lifting of restrictions on movement and the potential
imposition of further restrictions on movement and travel in the
future, the effect of the pandemic on the general economy and on
the businesses of our borrowers and their ability to make payments
on their obligations; the remedial actions and stimulus measures
adopted by federal, state and local governments, and the inability
of employees to work due to illness, quarantine, or government
mandates); (ii) the impacts related to or resulting from Russia’s
military action in Ukraine, including the broader impacts to
financial markets and the global macroeconomic and geopolitical
environments; (iii) assumptions that interest-earning assets will
reprice faster than interest-bearing liabilities and the Bank’s
ability to maintain its current favorable funding mix; (iv) the
synergies and other expected financial benefits from any
acquisition that we have undertaken or may undertake in the future
may or may not be realized within the expected time frames; (v)
changes in the Company's or the Bank's strategy, costs or
difficulties related to integration matters might be greater than
expected; (vi) availability of and costs associated with obtaining
adequate and timely sources of liquidity; (vii) the ability to
maintain credit quality; (viii) general economic trends and
conditions, including inflation and its impacts; (ix) changes in
interest rates; (x) loss of deposits and loan demand to other
financial institutions; (xi) substantial changes in financial
markets; (xii) changes in real estate value and the real estate
market; (xiii) regulatory changes; (xiv) the impact of government
shutdowns or sequestration; (xv) the possibility of unforeseen
events affecting the industry generally; (xvi) the uncertainties
associated with newly developed or acquired operations; (xvii) the
outcome of pending or threatened litigation, or of matters before
regulatory agencies, whether currently existing or commencing in
the future; (xiii) market disruptions and other effects of
terrorist activities; and (xix) the matters described in “Item 1A
Risk Factors” in the Company’s Annual Report on Form 10-K for the
Year Ended December 31, 2021, and in its other Reports filed
with the Securities and Exchange Commission (the “SEC”). The
Company’s forward-looking statements may also be subject to other
risks and uncertainties, including those that it may discuss
elsewhere in this news release or in its filings with the SEC,
accessible on the SEC’s Web site at www.sec.gov. The Company
undertakes no obligation to update these forward-looking statements
to reflect events or circumstances after the date hereof or to
reflect the occurrence of unforeseen events, except as required
under the rules and regulations of the SEC.
Data is unaudited as of June 30, 2022. This
selected information should be read in conjunction with the
financial statements and notes included in the Company's Annual
Report on Form 10-K for the year ended December 31, 2021.
CONTACTS:
William J. Pasenelli, Chief Executive Officer
Todd L. Capitani, Chief Financial Officer
888.745.2265
SUPPLEMENTAL QUARTERLY FINANCIAL
DATA
CONSOLIDATED INCOME STATEMENT (UNAUDITED)
|
|
Three Months Ended |
(dollars in thousands) |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
Interest and Dividend Income |
|
|
|
|
|
|
|
|
|
|
Loans, including fees |
|
$ |
16,772 |
|
|
$ |
15,610 |
|
|
$ |
16,222 |
|
|
$ |
16,342 |
|
|
$ |
16,320 |
|
Interest and dividends on securities |
|
|
1,924 |
|
|
|
1,666 |
|
|
|
1,531 |
|
|
|
1,296 |
|
|
|
1,101 |
|
Interest on deposits with banks |
|
|
78 |
|
|
|
60 |
|
|
|
25 |
|
|
|
21 |
|
|
|
23 |
|
Total Interest and
Dividend Income |
|
|
18,774 |
|
|
|
17,336 |
|
|
|
17,778 |
|
|
|
17,659 |
|
|
|
17,444 |
|
Interest
Expense |
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
819 |
|
|
|
513 |
|
|
|
565 |
|
|
|
594 |
|
|
|
640 |
|
Short-term borrowings |
|
|
16 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Long-term debt |
|
|
371 |
|
|
|
354 |
|
|
|
332 |
|
|
|
456 |
|
|
|
369 |
|
Total Interest
Expense |
|
|
1,206 |
|
|
|
867 |
|
|
|
897 |
|
|
|
1,050 |
|
|
|
1,009 |
|
Net Interest Income
("NII") |
|
|
17,568 |
|
|
|
16,469 |
|
|
|
16,881 |
|
|
|
16,609 |
|
|
|
16,435 |
|
Provision for credit losses |
|
|
425 |
|
|
|
450 |
|
|
|
— |
|
|
|
— |
|
|
|
291 |
|
Provision (recovery) for unfunded commitments |
|
|
26 |
|
|
|
(31 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
NII After Provision
For Credit Losses |
|
|
17,117 |
|
|
|
16,050 |
|
|
|
16,881 |
|
|
|
16,609 |
|
|
|
16,144 |
|
Noninterest
Income |
|
|
|
|
|
|
|
|
|
|
Loan appraisal, credit, and misc. charges |
|
|
44 |
|
|
|
176 |
|
|
|
257 |
|
|
|
29 |
|
|
|
44 |
|
Gain on sale of assets |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
68 |
|
Unrealized (losses) gain on equity securities |
|
|
(155 |
) |
|
|
(222 |
) |
|
|
(45 |
) |
|
|
(22 |
) |
|
|
13 |
|
Loss on premises and equipment held for sale |
|
|
— |
|
|
|
— |
|
|
|
(5 |
) |
|
|
(20 |
) |
|
|
— |
|
Income from bank owned life insurance |
|
|
217 |
|
|
|
214 |
|
|
|
219 |
|
|
|
220 |
|
|
|
218 |
|
Service charges |
|
|
1,108 |
|
|
|
926 |
|
|
|
1,235 |
|
|
|
987 |
|
|
|
892 |
|
Referral fee income |
|
|
— |
|
|
|
361 |
|
|
|
574 |
|
|
|
176 |
|
|
|
621 |
|
Net gains (losses) on sale of loans originated for sale |
|
|
1 |
|
|
|
(4 |
) |
|
|
55 |
|
|
|
30 |
|
|
|
— |
|
Gains on sale of loans |
|
|
209 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total Noninterest
Income |
|
|
1,424 |
|
|
|
1,451 |
|
|
|
2,290 |
|
|
|
1,400 |
|
|
|
1,856 |
|
Noninterest
Expense |
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
|
5,051 |
|
|
|
5,055 |
|
|
|
5,265 |
|
|
|
5,650 |
|
|
|
5,332 |
|
OREO valuation allowance and expenses |
|
|
— |
|
|
|
6 |
|
|
|
767 |
|
|
|
20 |
|
|
|
488 |
|
Sub
Total |
|
|
5,051 |
|
|
|
5,061 |
|
|
|
6,032 |
|
|
|
5,670 |
|
|
|
5,820 |
|
Operating
Expenses |
|
|
|
|
|
|
|
|
|
|
Occupancy expense |
|
|
820 |
|
|
|
732 |
|
|
|
656 |
|
|
|
731 |
|
|
|
688 |
|
Advertising |
|
|
159 |
|
|
|
64 |
|
|
|
128 |
|
|
|
145 |
|
|
|
148 |
|
Data processing expense |
|
|
1,008 |
|
|
|
1,007 |
|
|
|
1,006 |
|
|
|
840 |
|
|
|
990 |
|
Professional fees |
|
|
845 |
|
|
|
731 |
|
|
|
937 |
|
|
|
676 |
|
|
|
604 |
|
Depreciation of premises and equipment |
|
|
150 |
|
|
|
149 |
|
|
|
139 |
|
|
|
137 |
|
|
|
135 |
|
FDIC Insurance |
|
|
177 |
|
|
|
179 |
|
|
|
90 |
|
|
|
120 |
|
|
|
140 |
|
Core deposit intangible amortization |
|
|
102 |
|
|
|
109 |
|
|
|
115 |
|
|
|
121 |
|
|
|
126 |
|
Fraud losses (recovery) |
|
|
30 |
|
|
|
40 |
|
|
|
16 |
|
|
|
133 |
|
|
|
(217 |
) |
Other expenses |
|
|
996 |
|
|
|
1,008 |
|
|
|
1,060 |
|
|
|
874 |
|
|
|
944 |
|
Total Operating
Expenses |
|
|
4,287 |
|
|
|
4,019 |
|
|
|
4,147 |
|
|
|
3,777 |
|
|
|
3,558 |
|
Total Noninterest
Expense |
|
|
9,338 |
|
|
|
9,080 |
|
|
|
10,179 |
|
|
|
9,447 |
|
|
|
9,378 |
|
Income before income taxes |
|
|
9,203 |
|
|
|
8,421 |
|
|
|
8,992 |
|
|
|
8,562 |
|
|
|
8,622 |
|
Income tax expense |
|
|
2,369 |
|
|
|
2,133 |
|
|
|
2,241 |
|
|
|
2,158 |
|
|
|
2,190 |
|
Net
Income |
|
$ |
6,834 |
|
|
$ |
6,288 |
|
|
$ |
6,751 |
|
|
$ |
6,404 |
|
|
$ |
6,432 |
|
|
|
SUPPLEMENTAL QUARTERLY FINANCIAL DATA -
Continued
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(dollars in thousands, except per share amounts) |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
Assets |
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
$ |
16,164 |
|
|
$ |
80,702 |
|
|
$ |
108,990 |
|
|
$ |
112,314 |
|
|
$ |
40,881 |
|
Federal funds sold |
|
|
37,320 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
79,404 |
|
Interest-bearing deposits with
banks |
|
|
34,659 |
|
|
|
32,460 |
|
|
|
30,664 |
|
|
|
34,929 |
|
|
|
18,626 |
|
Securities available for sale
("AFS"), at fair value |
|
|
485,456 |
|
|
|
507,527 |
|
|
|
497,839 |
|
|
|
456,664 |
|
|
|
347,678 |
|
Equity securities carried at
fair value through income |
|
|
4,423 |
|
|
|
4,562 |
|
|
|
4,772 |
|
|
|
4,805 |
|
|
|
4,814 |
|
Non-marketable equity
securities held in other financial institutions |
|
|
207 |
|
|
|
207 |
|
|
|
207 |
|
|
|
207 |
|
|
|
207 |
|
Federal Home Loan Bank
("FHLB") stock - at cost |
|
|
1,234 |
|
|
|
1,685 |
|
|
|
1,472 |
|
|
|
1,472 |
|
|
|
2,036 |
|
Loans held for sale |
|
|
— |
|
|
|
373 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net U.S. Small Business
Administration ("SBA") Paycheck Protection ("PPP") Loans |
|
|
5,022 |
|
|
|
15,279 |
|
|
|
26,398 |
|
|
|
54,807 |
|
|
|
86,482 |
|
Portfolio Loans Receivable net
of allowance for credit losses of $21,404, $21,382, $18,417,
$18,579, and $18,516 |
|
|
1,631,055 |
|
|
|
1,608,156 |
|
|
|
1,560,393 |
|
|
|
1,514,837 |
|
|
|
1,515,893 |
|
Net Loans |
|
|
1,636,077 |
|
|
|
1,623,435 |
|
|
|
1,586,791 |
|
|
|
1,569,644 |
|
|
|
1,602,375 |
|
Goodwill |
|
|
10,835 |
|
|
|
10,835 |
|
|
|
10,835 |
|
|
|
10,835 |
|
|
|
10,835 |
|
Premises and equipment,
net |
|
|
21,802 |
|
|
|
21,304 |
|
|
|
21,427 |
|
|
|
21,795 |
|
|
|
21,630 |
|
Other real estate owned
("OREO") |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,536 |
|
|
|
1,536 |
|
Accrued interest
receivable |
|
|
6,099 |
|
|
|
5,389 |
|
|
|
5,588 |
|
|
|
6,045 |
|
|
|
6,590 |
|
Investment in bank owned life
insurance |
|
|
39,363 |
|
|
|
39,145 |
|
|
|
38,932 |
|
|
|
38,713 |
|
|
|
38,493 |
|
Core deposit intangible |
|
|
821 |
|
|
|
924 |
|
|
|
1,032 |
|
|
|
1,147 |
|
|
|
1,267 |
|
Net deferred tax assets |
|
|
20,223 |
|
|
|
15,523 |
|
|
|
9,033 |
|
|
|
8,790 |
|
|
|
8,139 |
|
Right of use assets -
operating leases |
|
|
6,123 |
|
|
|
6,033 |
|
|
|
6,124 |
|
|
|
6,215 |
|
|
|
6,305 |
|
Other assets |
|
|
2,708 |
|
|
|
1,819 |
|
|
|
3,600 |
|
|
|
3,581 |
|
|
|
4,243 |
|
Total
Assets |
|
$ |
2,323,514 |
|
|
$ |
2,351,923 |
|
|
$ |
2,327,306 |
|
|
$ |
2,278,692 |
|
|
$ |
2,195,059 |
|
Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing deposits |
|
$ |
635,649 |
|
|
$ |
644,385 |
|
|
$ |
445,778 |
|
|
$ |
432,606 |
|
|
$ |
423,165 |
|
Interest-bearing deposits |
|
|
1,449,727 |
|
|
|
1,450,698 |
|
|
|
1,610,386 |
|
|
|
1,572,001 |
|
|
|
1,484,973 |
|
Total deposits |
|
|
2,085,376 |
|
|
|
2,095,083 |
|
|
|
2,056,164 |
|
|
|
2,004,607 |
|
|
|
1,908,138 |
|
Long-term debt |
|
|
— |
|
|
|
12,213 |
|
|
|
12,231 |
|
|
|
12,249 |
|
|
|
27,267 |
|
Guaranteed preferred
beneficial interest in junior subordinated debentures
("TRUPs") |
|
|
12,000 |
|
|
|
12,000 |
|
|
|
12,000 |
|
|
|
12,000 |
|
|
|
12,000 |
|
Subordinated notes -
4.75% |
|
|
19,538 |
|
|
|
19,524 |
|
|
|
19,510 |
|
|
|
19,496 |
|
|
|
19,482 |
|
Lease liabilities - operating
leases |
|
|
6,372 |
|
|
|
6,266 |
|
|
|
6,343 |
|
|
|
6,418 |
|
|
|
6,512 |
|
Accrued expenses and other
liabilities |
|
|
15,357 |
|
|
|
13,697 |
|
|
|
12,925 |
|
|
|
19,794 |
|
|
|
17,698 |
|
Total
Liabilities |
|
|
2,138,643 |
|
|
|
2,158,783 |
|
|
|
2,119,173 |
|
|
|
2,074,564 |
|
|
|
1,991,097 |
|
Stockholders'
Equity |
|
|
|
|
|
|
|
|
|
|
Common stock |
|
|
56 |
|
|
|
57 |
|
|
|
57 |
|
|
|
57 |
|
|
|
58 |
|
Additional paid in
capital |
|
|
97,455 |
|
|
|
97,189 |
|
|
|
96,896 |
|
|
|
96,649 |
|
|
|
96,411 |
|
Retained earnings |
|
|
119,523 |
|
|
|
115,179 |
|
|
|
113,448 |
|
|
|
107,890 |
|
|
|
104,889 |
|
Accumulated other
comprehensive (loss) income |
|
|
(31,847 |
) |
|
|
(18,969 |
) |
|
|
(1,952 |
) |
|
|
(9 |
) |
|
|
3,063 |
|
Unearned ESOP shares |
|
|
(316 |
) |
|
|
(316 |
) |
|
|
(316 |
) |
|
|
(459 |
) |
|
|
(459 |
) |
Total Stockholders'
Equity |
|
|
184,871 |
|
|
|
193,140 |
|
|
|
208,133 |
|
|
|
204,128 |
|
|
|
203,962 |
|
Total Liabilities and
Stockholders' Equity |
|
$ |
2,323,514 |
|
|
$ |
2,351,923 |
|
|
$ |
2,327,306 |
|
|
$ |
2,278,692 |
|
|
$ |
2,195,059 |
|
Common shares issued and
outstanding |
|
|
5,649,729 |
|
|
|
5,686,799 |
|
|
|
5,718,528 |
|
|
|
5,724,011 |
|
|
|
5,786,928 |
|
|
|
SUPPLEMENTAL QUARTERLY FINANCIAL DATA -
Continued
SELECTED FINANCIAL INFORMATION AND RATIOS
(UNAUDITED)
|
|
Three Months Ended |
(dollars in thousands, except per share amounts) |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
KEY OPERATING RATIOS |
|
|
|
|
|
|
|
|
|
|
Return on average assets ("ROAA") |
|
|
1.19 |
% |
|
|
1.08 |
% |
|
|
1.18 |
% |
|
|
1.17 |
% |
|
|
1.22 |
% |
Pre-tax Pre-Provision
ROAA** |
|
|
1.68 |
|
|
|
1.53 |
|
|
|
1.57 |
|
|
|
1.57 |
|
|
|
1.68 |
|
Return on average common
equity ("ROACE") |
|
|
14.39 |
|
|
|
12.30 |
|
|
|
13.00 |
|
|
|
12.45 |
|
|
|
12.62 |
|
Pre-tax Pre-Provision
ROACE** |
|
|
20.33 |
|
|
|
17.35 |
|
|
|
17.31 |
|
|
|
16.65 |
|
|
|
17.49 |
|
Return on Average Tangible
Common Equity ("ROATCE")** |
|
|
15.50 |
|
|
|
13.22 |
|
|
|
13.97 |
|
|
|
13.41 |
|
|
|
13.62 |
|
Average total equity to
average total assets |
|
|
8.28 |
|
|
|
8.79 |
|
|
|
9.06 |
|
|
|
9.40 |
|
|
|
9.63 |
|
Interest rate spread |
|
|
3.14 |
|
|
|
3.05 |
|
|
|
3.17 |
|
|
|
3.22 |
|
|
|
3.30 |
|
Net interest margin |
|
|
3.25 |
|
|
|
3.12 |
|
|
|
3.22 |
|
|
|
3.28 |
|
|
|
3.37 |
|
Cost of funds |
|
|
0.23 |
|
|
|
0.17 |
|
|
|
0.17 |
|
|
|
0.21 |
|
|
|
0.21 |
|
Cost of deposits |
|
|
0.16 |
|
|
|
0.10 |
|
|
|
0.11 |
|
|
|
0.12 |
|
|
|
0.14 |
|
Cost of debt |
|
|
3.81 |
|
|
|
3.24 |
|
|
|
3.04 |
|
|
|
3.19 |
|
|
|
2.51 |
|
Efficiency ratio |
|
|
49.17 |
|
|
|
50.67 |
|
|
|
53.10 |
|
|
|
52.46 |
|
|
|
51.27 |
|
Non-interest income to average
assets |
|
|
0.25 |
|
|
|
0.25 |
|
|
|
0.40 |
|
|
|
0.26 |
|
|
|
0.35 |
|
Non-interest expense to
average assets |
|
|
1.63 |
|
|
|
1.56 |
|
|
|
1.78 |
|
|
|
1.73 |
|
|
|
1.77 |
|
Net operating expense to
average assets |
|
|
1.38 |
|
|
|
1.31 |
|
|
|
1.38 |
|
|
|
1.47 |
|
|
|
1.42 |
|
Average interest-earning
assets to average interest-bearing liabilities |
|
|
150.34 |
|
|
|
141.56 |
|
|
|
129.68 |
|
|
|
132.54 |
|
|
|
131.36 |
|
Net charge-offs (recoveries)
to average portfolio loans |
|
|
0.10 |
|
|
|
0.00 |
|
|
|
0.04 |
|
|
|
(0.02 |
) |
|
|
0.01 |
|
|
|
|
|
|
|
|
|
|
|
|
COMMON SHARE
DATA |
|
|
|
|
|
|
|
|
|
|
Basic net income per common
share |
|
$ |
1.21 |
|
|
$ |
1.11 |
|
|
$ |
1.18 |
|
|
$ |
1.12 |
|
|
$ |
1.10 |
|
Diluted net income per common
share |
|
|
1.21 |
|
|
|
1.10 |
|
|
|
1.18 |
|
|
|
1.12 |
|
|
|
1.10 |
|
Cash dividends paid per common
share |
|
|
0.175 |
|
|
|
0.175 |
|
|
|
0.150 |
|
|
|
0.15 |
|
|
|
0.15 |
|
Basic - weighted average
common shares outstanding |
|
|
5,647,821 |
|
|
|
5,688,221 |
|
|
|
5,711,746 |
|
|
|
5,709,814 |
|
|
|
5,845,009 |
|
Diluted - weighted average
common shares outstanding |
|
|
5,657,733 |
|
|
|
5,699,038 |
|
|
|
5,723,011 |
|
|
|
5,720,001 |
|
|
|
5,856,954 |
|
|
|
|
|
|
|
|
|
|
|
|
ASSET
QUALITY |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
2,323,514 |
|
|
$ |
2,351,923 |
|
|
$ |
2,327,306 |
|
|
$ |
2,278,692 |
|
|
$ |
2,195,059 |
|
Total portfolio loans
(1) |
|
|
1,652,459 |
|
|
|
1,629,538 |
|
|
|
1,578,810 |
|
|
|
1,533,416 |
|
|
|
1,534,409 |
|
Classified assets |
|
|
6,062 |
|
|
|
4,745 |
|
|
|
5,211 |
|
|
|
6,663 |
|
|
|
14,918 |
|
Allowance for credit
losses |
|
|
21,404 |
|
|
|
21,382 |
|
|
|
18,417 |
|
|
|
18,579 |
|
|
|
18,516 |
|
|
|
|
|
|
|
|
|
|
|
|
Past due loans - 31 to 89
days |
|
|
900 |
|
|
|
386 |
|
|
|
568 |
|
|
|
189 |
|
|
|
101 |
|
Past due loans >=90
days |
|
|
147 |
|
|
|
1,233 |
|
|
|
961 |
|
|
|
1,400 |
|
|
|
5,836 |
|
Total past due loans (2)
(3) |
|
|
1,047 |
|
|
|
1,619 |
|
|
|
1,529 |
|
|
|
1,589 |
|
|
|
5,937 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-accrual loans
(4) |
|
|
6,235 |
|
|
|
7,465 |
|
|
|
7,631 |
|
|
|
5,160 |
|
|
|
13,802 |
|
Accruing troubled debt
restructures ("TDRs") |
|
|
439 |
|
|
|
442 |
|
|
|
447 |
|
|
|
455 |
|
|
|
503 |
|
Other real estate owned
("OREO") |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,536 |
|
|
|
1,536 |
|
Non-accrual loans, OREO and TDRs |
|
$ |
6,674 |
|
|
$ |
7,907 |
|
|
$ |
8,078 |
|
|
$ |
7,151 |
|
|
$ |
15,841 |
|
** Non-GAAP financial measure. See
reconciliation of GAAP and NON-GAAP measures.
____________________________________
(1) Portfolio loans include all loan portfolios
except the U.S. SBA PPP loan portfolio. Asset quality ratios for
loans exclude U.S. SBA PPP loans. December 31, 2021, September 30,
2021 and June 30, 2021 reported balance are shown net of deferred
costs and fees to conform with the current period's
presentation.
(2) Delinquency excludes Purchase Credit
Impaired ("PCI") loans for December 31, 2021,
September 30, 2021 and June 30, 2021.
(3) There were no COVID-19 deferred loans in
process as of July 25, 2022 that were reported as delinquent
as of June 30, 2022.
(4) Non-accrual loans include all loans that are
90 days or more delinquent and loans that are non-accrual due to
the operating results or cash flows of a customer. Non-accrual
loans can include loans that are current with all loan payments. At
June 30, 2022 and December 31, 2021, the Company had
current non-accrual loans of $6.1 million and $6.7 million,
respectively.
SUPPLEMENTAL QUARTERLY FINANCIAL DATA -
Continued
SELECTED FINANCIAL INFORMATION AND RATIOS
(UNAUDITED)
|
|
Three Months Ended |
(dollars in thousands, except per share amounts) |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
ASSET QUALITY RATIOS (1) |
|
|
|
|
|
|
|
|
|
|
Classified assets to total assets |
|
|
0.26 |
% |
|
|
0.20 |
% |
|
|
0.22 |
% |
|
|
0.29 |
% |
|
|
0.68 |
% |
Classified assets to
risk-based capital |
|
|
2.35 |
|
|
|
1.87 |
|
|
|
2.10 |
|
|
|
2.75 |
|
|
|
6.24 |
|
Allowance for credit losses to
total portfolio loans |
|
|
1.30 |
|
|
|
1.31 |
|
|
|
1.17 |
|
|
|
1.21 |
|
|
|
1.21 |
|
Allowance for credit losses to
non-accrual loans |
|
|
343.29 |
|
|
|
286.43 |
|
|
|
241.34 |
|
|
|
360.06 |
|
|
|
134.15 |
|
Past due loans - 31 to 89 days
to total portfolio loans |
|
|
0.05 |
|
|
|
0.02 |
|
|
|
0.04 |
|
|
|
0.01 |
|
|
|
0.01 |
|
Past due loans >=90 days to
total portfolio loans |
|
|
0.01 |
|
|
|
0.08 |
|
|
|
0.06 |
|
|
|
0.09 |
|
|
|
0.38 |
|
Total past due (delinquency)
to total portfolio loans |
|
|
0.06 |
|
|
|
0.10 |
|
|
|
0.10 |
|
|
|
0.10 |
|
|
|
0.39 |
|
Non-accrual loans to total
portfolio loans |
|
|
0.38 |
|
|
|
0.46 |
|
|
|
0.48 |
|
|
|
0.34 |
|
|
|
0.90 |
|
Non-accrual loans and TDRs to
total portfolio loans |
|
|
0.40 |
|
|
|
0.49 |
|
|
|
0.51 |
|
|
|
0.37 |
|
|
|
0.93 |
|
Non-accrual loans and OREO to
total portfolio assets |
|
|
0.27 |
|
|
|
0.32 |
|
|
|
0.33 |
|
|
|
0.29 |
|
|
|
0.70 |
|
Non-accrual loans and OREO to
total portfolio loans and OREO |
|
|
0.38 |
|
|
|
0.46 |
|
|
|
0.48 |
|
|
|
0.44 |
|
|
|
1.00 |
|
Non-accrual loans, OREO and
TDRs to total assets |
|
|
0.29 |
|
|
|
0.34 |
|
|
|
0.35 |
|
|
|
0.31 |
|
|
|
0.72 |
|
|
|
|
|
|
|
|
|
|
|
|
COMMON SHARE
DATA |
|
|
|
|
|
|
|
|
|
|
Book value per common
share |
|
$ |
32.72 |
|
|
$ |
33.96 |
|
|
$ |
36.40 |
|
|
$ |
35.66 |
|
|
$ |
35.25 |
|
Tangible book value per common
share** |
|
|
30.66 |
|
|
|
31.90 |
|
|
|
34.32 |
|
|
|
33.57 |
|
|
|
33.15 |
|
Common shares outstanding at
end of period |
|
|
5,649,729 |
|
|
|
5,686,799 |
|
|
|
5,718,528 |
|
|
|
5,724,011 |
|
|
|
5,786,928 |
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
DATA |
|
|
|
|
|
|
|
|
|
|
Full-time equivalent
employees |
|
|
190 |
|
|
|
191 |
|
|
|
186 |
|
|
|
196 |
|
|
|
189 |
|
Branches |
|
|
12 |
|
|
|
11 |
|
|
|
11 |
|
|
|
11 |
|
|
|
11 |
|
Loan Production Offices |
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
RATIOS |
|
|
|
|
|
|
|
|
|
|
Tier 1 capital to average
assets |
|
|
9.42 |
% |
|
|
9.17 |
% |
|
|
9.23 |
% |
|
|
9.41 |
% |
|
|
9.57 |
% |
Tier 1 common capital to
risk-weighted assets |
|
|
11.66 |
|
|
|
11.58 |
|
|
|
11.92 |
|
|
|
11.89 |
|
|
|
11.56 |
|
Tier 1 capital to
risk-weighted assets |
|
|
12.34 |
|
|
|
12.28 |
|
|
|
12.64 |
|
|
|
12.64 |
|
|
|
12.30 |
|
Total risk-based capital to
risk-weighted assets |
|
|
14.68 |
|
|
|
14.65 |
|
|
|
14.92 |
|
|
|
14.99 |
|
|
|
14.62 |
|
Common equity to assets |
|
|
7.96 |
|
|
|
8.21 |
|
|
|
8.94 |
|
|
|
8.96 |
|
|
|
9.29 |
|
Tangible common equity to
tangible assets ** |
|
|
7.49 |
|
|
|
7.75 |
|
|
|
8.48 |
|
|
|
8.48 |
|
|
|
8.79 |
|
** Non-GAAP financial measure. See
reconciliation of GAAP and NON-GAAP measures.
____________________________________
(1) Asset quality ratios are calculated using
total portfolio loans. Portfolio loans include all loan portfolios
except the U.S. SBA PPP loan portfolio.
SUPPLEMENTAL YEAR TO DATE FINANCIAL
DATA
CONSOLIDATED INCOME STATEMENT (UNAUDITED)
|
|
Six Months Ended June 30, |
(dollars in thousands) |
|
|
2022 |
|
|
|
2021 |
|
Interest and Dividend Income |
|
|
|
|
Loans, including fees |
|
$ |
32,382 |
|
|
$ |
32,912 |
|
Interest and dividends on securities |
|
|
3,590 |
|
|
|
2,165 |
|
Interest on deposits with banks |
|
|
138 |
|
|
|
45 |
|
Total Interest and
Dividend Income |
|
|
36,110 |
|
|
|
35,122 |
|
Interest
Expense |
|
|
|
|
Deposits |
|
|
1,332 |
|
|
|
1,442 |
|
Short-term borrowings |
|
|
16 |
|
|
|
— |
|
Long-term debt |
|
|
725 |
|
|
|
736 |
|
Total Interest
Expense |
|
|
2,073 |
|
|
|
2,178 |
|
Net Interest Income
("NII") |
|
|
34,037 |
|
|
|
32,944 |
|
Provision for credit losses |
|
|
875 |
|
|
|
586 |
|
Recovery for unfunded commitments |
|
|
(5 |
) |
|
|
— |
|
NII After Provision
for Credit Losses |
|
|
33,167 |
|
|
|
32,358 |
|
Noninterest
Income |
|
|
|
|
Loan appraisal, credit, and misc. charges |
|
|
220 |
|
|
|
242 |
|
Gain on sale of assets |
|
|
— |
|
|
|
68 |
|
Net gains on sale of investment securities |
|
|
— |
|
|
|
586 |
|
Unrealized losses on equity securities |
|
|
(377 |
) |
|
|
(72 |
) |
Income from bank owned life insurance |
|
|
431 |
|
|
|
432 |
|
Service charges |
|
|
2,034 |
|
|
|
2,079 |
|
Referral fee income |
|
|
361 |
|
|
|
1,072 |
|
Net losses on sale of loans originated for sale |
|
|
(3 |
) |
|
|
— |
|
Gains (losses) on sale of loans |
|
|
209 |
|
|
|
(191 |
) |
Total Noninterest
Income |
|
|
2,875 |
|
|
|
4,216 |
|
Noninterest
Expense |
|
|
|
|
Compensation and benefits |
|
|
10,106 |
|
|
|
10,120 |
|
OREO valuation allowance and expenses |
|
|
6 |
|
|
|
669 |
|
Sub-total |
|
|
10,112 |
|
|
|
10,789 |
|
Operating
Expense |
|
|
|
|
Occupancy expense |
|
|
1,552 |
|
|
|
1,449 |
|
Advertising |
|
|
223 |
|
|
|
227 |
|
Data processing expense |
|
|
2,015 |
|
|
|
1,926 |
|
Professional fees |
|
|
1,576 |
|
|
|
1,244 |
|
Depreciation of premises and equipment |
|
|
299 |
|
|
|
282 |
|
FDIC Insurance |
|
|
356 |
|
|
|
392 |
|
Core deposit intangible amortization |
|
|
211 |
|
|
|
259 |
|
Fraud losses |
|
|
70 |
|
|
|
1,112 |
|
Other expenses |
|
|
2,004 |
|
|
|
1,846 |
|
Total Operating
Expense |
|
|
8,306 |
|
|
|
8,737 |
|
Total Noninterest
Expense |
|
|
18,418 |
|
|
|
19,526 |
|
Income before income
taxes |
|
|
17,624 |
|
|
|
17,048 |
|
Income tax expense |
|
|
4,502 |
|
|
|
4,317 |
|
Net
Income |
|
$ |
13,122 |
|
|
$ |
12,731 |
|
|
|
SUPPLEMENTAL YEAR TO DATE FINANCIAL DATA
(UNAUDITED)
|
|
Six Months Ended June 30, |
|
|
|
2022 |
|
|
|
2021 |
|
KEY OPERATING RATIOS |
|
|
|
|
Return on average assets
("ROAA") |
|
|
1.14 |
% |
|
|
1.22 |
% |
Pre-tax Pre-Provision
ROAA** |
|
|
1.60 |
|
|
|
1.68 |
|
Return on average common
equity ("ROACE") |
|
|
13.31 |
|
|
|
12.57 |
|
Pre-tax Pre-Provision
ROACE** |
|
|
18.76 |
|
|
|
17.41 |
|
Return on Average Tangible
Common Equity ("ROATCE") |
|
|
14.32 |
|
|
|
13.59 |
|
Average total equity to
average total assets |
|
|
8.54 |
|
|
|
9.67 |
|
Interest rate spread |
|
|
3.10 |
|
|
|
3.36 |
|
Net interest margin |
|
|
3.19 |
|
|
|
3.43 |
|
Cost of funds |
|
|
0.20 |
|
|
|
0.23 |
|
Cost of deposits |
|
|
0.13 |
|
|
|
0.16 |
|
Cost of debt |
|
|
3.51 |
|
|
|
2.50 |
|
Efficiency ratio |
|
|
49.90 |
|
|
|
52.55 |
|
Non-interest income to average
assets |
|
|
0.25 |
|
|
|
0.40 |
|
Non-interest expense to
average assets |
|
|
1.59 |
|
|
|
1.87 |
|
Net operating expense to
average assets |
|
|
1.35 |
|
|
|
1.46 |
|
Average interest-earning
assets to average interest-bearing liabilities |
|
|
145.89 |
|
|
|
130.12 |
|
Net charge-offs to average
portfolio loans |
|
|
0.05 |
|
|
|
0.20 |
|
|
|
|
|
|
COMMON SHARE
DATA |
|
|
|
|
Basic net income per common
share |
|
$ |
2.32 |
|
|
$ |
2.17 |
|
Diluted net income per common
share |
|
|
2.31 |
|
|
|
2.17 |
|
Cash dividends paid per common
share |
|
|
0.35 |
|
|
|
0.28 |
|
|
|
|
|
|
Weighted average
common shares outstanding: |
|
|
|
|
Basic |
|
|
5,667,909 |
|
|
|
5,866,510 |
|
Diluted |
|
|
5,678,165 |
|
|
|
5,877,698 |
|
____________________________________
** Non-GAAP financial measure. See reconciliation of GAAP and
NON-GAAP measures.
RECONCILIATION OF NON-GAAP MEASURES
(UNAUDITED)
Reconciliation of U.S. GAAP total
assets, common equity, common equity to assets and book value to
Non-GAAP tangible assets, tangible common equity, tangible common
equity to tangible assets and tangible book value.
This press release, including the accompanying
financial statement tables, contains financial information
determined by methods other than in accordance with generally
accepted accounting principles, or GAAP. This financial information
includes certain performance measures, which exclude intangible
assets. These non-GAAP measures are included because the Company
believes they may provide useful supplemental information for
evaluating the underlying performance trends of the Company.
(dollars in thousands, except per share amounts) |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
Total assets |
|
$ |
2,323,514 |
|
|
$ |
2,351,923 |
|
|
$ |
2,327,306 |
|
|
$ |
2,278,692 |
|
|
$ |
2,195,059 |
|
Less: intangible assets |
|
|
|
|
|
|
|
|
|
|
Goodwill |
|
|
10,835 |
|
|
|
10,835 |
|
|
|
10,835 |
|
|
|
10,835 |
|
|
|
10,835 |
|
Core deposit intangible |
|
|
821 |
|
|
|
924 |
|
|
|
1,032 |
|
|
|
1,147 |
|
|
|
1,267 |
|
Total intangible assets |
|
|
11,656 |
|
|
|
11,759 |
|
|
|
11,867 |
|
|
|
11,982 |
|
|
|
12,102 |
|
Tangible assets |
|
$ |
2,311,858 |
|
|
$ |
2,340,164 |
|
|
$ |
2,315,439 |
|
|
$ |
2,266,710 |
|
|
$ |
2,182,957 |
|
|
|
|
|
|
|
|
|
|
|
|
Total common equity |
|
$ |
184,871 |
|
|
$ |
193,140 |
|
|
$ |
208,133 |
|
|
$ |
204,128 |
|
|
$ |
203,962 |
|
Less: intangible assets |
|
|
11,656 |
|
|
|
11,759 |
|
|
|
11,867 |
|
|
|
11,982 |
|
|
|
12,102 |
|
Tangible common equity |
|
$ |
173,215 |
|
|
$ |
181,381 |
|
|
$ |
196,266 |
|
|
$ |
192,146 |
|
|
$ |
191,860 |
|
|
|
|
|
|
|
|
|
|
|
|
Common shares outstanding at
end of period |
|
|
5,649,729 |
|
|
|
5,686,799 |
|
|
|
5,718,528 |
|
|
|
5,724,011 |
|
|
|
5,786,928 |
|
|
|
|
|
|
|
|
|
|
|
|
Common equity to assets |
|
|
7.96 |
% |
|
|
8.21 |
% |
|
|
8.94 |
% |
|
|
8.96 |
% |
|
|
9.29 |
% |
Tangible common equity to
tangible assets |
|
|
7.49 |
% |
|
|
7.75 |
% |
|
|
8.48 |
% |
|
|
8.48 |
% |
|
|
8.79 |
% |
|
|
|
|
|
|
|
|
|
|
|
Common book value per
share |
|
$ |
32.72 |
|
|
$ |
33.96 |
|
|
$ |
36.40 |
|
|
$ |
35.66 |
|
|
$ |
35.25 |
|
Tangible common book value per
share |
|
$ |
30.66 |
|
|
$ |
31.90 |
|
|
$ |
34.32 |
|
|
$ |
33.57 |
|
|
$ |
33.15 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF NON-GAAP MEASURES
(UNAUDITED)
Pre-Tax Pre-Provision ("PTPP") Income,
PTPP Return on Average Assets ("ROAA"), PTPP Return on Average
Common Equity ("ROACE"), and Return on Average Tangible Common
Equity ("ROATCE")
Management believes that PTPP income, which
reflects the Company's profitability before income taxes and
provisions for credit losses, allows investors to better assess the
Company's operating income and expenses in relation to the
Company's core operating revenue by removing the volatility that is
associated with credit provisions and different state income tax
rates for comparable institutions. ROATCE is computed by dividing
net earnings applicable to common shareholders by average tangible
common shareholders' equity. Management believes that ROATCE is
meaningful because it measures the performance of a business
consistently, whether acquired or internally developed. ROATCE is a
non-GAAP measure and may not be comparable to similar non-GAAP
measures used by other companies. Management also believes that
during a crisis such as the COVID-19 pandemic, this information is
useful as the impact of the pandemic on the provisions for credit
losses of various institutions will likely vary based on the
geography of the communities served by a particular
institution.
|
|
Three Months Ended |
|
Six Months Ended |
(dollars in thousands) |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
|
June 30, 2022 |
|
June 30, 2021 |
Net income (as reported) |
|
$ |
6,834 |
|
|
$ |
6,288 |
|
|
$ |
6,751 |
|
|
$ |
6,404 |
|
|
$ |
6,432 |
|
|
$ |
13,122 |
|
|
$ |
12,731 |
|
Provision for credit
losses |
|
|
425 |
|
|
|
450 |
|
|
|
— |
|
|
|
— |
|
|
|
291 |
|
|
|
875 |
|
|
|
586 |
|
Provision (recovery) for
unfunded commitments |
|
|
26 |
|
|
|
(31 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5 |
) |
|
|
— |
|
Income tax expenses |
|
|
2,369 |
|
|
|
2,133 |
|
|
|
2,241 |
|
|
|
2,158 |
|
|
|
2,190 |
|
|
|
4,502 |
|
|
|
4,317 |
|
Non-GAAP PTPP
income |
|
$ |
9,654 |
|
|
$ |
8,840 |
|
|
$ |
8,992 |
|
|
$ |
8,562 |
|
|
$ |
8,913 |
|
|
$ |
18,494 |
|
|
$ |
17,634 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROAA |
|
|
1.19 |
% |
|
|
1.08 |
% |
|
|
1.18 |
% |
|
|
1.17 |
% |
|
|
1.22 |
% |
|
|
1.14 |
% |
|
|
1.22 |
% |
Pre-tax Pre-Provision
ROAA |
|
|
1.68 |
% |
|
|
1.52 |
% |
|
|
1.57 |
% |
|
|
1.57 |
% |
|
|
1.68 |
% |
|
|
1.60 |
% |
|
|
1.68 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROACE |
|
|
14.39 |
% |
|
|
12.30 |
% |
|
|
13.00 |
% |
|
|
12.45 |
% |
|
|
12.62 |
% |
|
|
13.31 |
% |
|
|
12.57 |
% |
Pre-tax Pre-Provision
ROACE |
|
|
20.33 |
% |
|
|
17.29 |
% |
|
|
17.31 |
% |
|
|
16.65 |
% |
|
|
17.49 |
% |
|
|
18.75 |
% |
|
|
17.41 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average assets |
|
$ |
2,293,536 |
|
|
$ |
2,325,992 |
|
|
$ |
2,293,264 |
|
|
$ |
2,187,989 |
|
|
$ |
2,116,939 |
|
|
$ |
2,309,602 |
|
|
$ |
2,093,886 |
|
Average equity |
|
$ |
189,992 |
|
|
$ |
204,554 |
|
|
$ |
207,745 |
|
|
$ |
205,723 |
|
|
$ |
203,893 |
|
|
$ |
197,233 |
|
|
$ |
202,516 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
(dollars in thousands) |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
Net income (as reported) |
|
$ |
6,834 |
|
|
$ |
6,288 |
|
|
$ |
6,751 |
|
|
$ |
6,404 |
|
|
$ |
6,432 |
|
Core deposit intangible
amortization (net of tax) |
|
|
76 |
|
|
|
81 |
|
|
|
86 |
|
|
|
91 |
|
|
|
94 |
|
Net earnings applicable to
common shareholders |
|
$ |
6,910 |
|
|
$ |
6,369 |
|
|
$ |
6,837 |
|
|
$ |
6,495 |
|
|
$ |
6,526 |
|
|
|
|
|
|
|
|
|
|
|
|
ROATCE |
|
|
15.50 |
% |
|
|
13.22 |
% |
|
|
13.97 |
% |
|
|
13.41 |
% |
|
|
13.62 |
% |
|
|
|
|
|
|
|
|
|
|
|
Average tangible common
equity |
|
$ |
178,269 |
|
|
$ |
192,725 |
|
|
$ |
195,803 |
|
|
$ |
193,662 |
|
|
$ |
191,708 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE CONSOLIDATED BALANCE SHEETS AND
NET INTEREST INCOME (UNAUDITED)
|
|
For the Three Months Ended June 30, |
|
For the Three Months Ended |
|
|
|
2022 |
|
|
|
2021 |
|
|
June 30, 2022 |
|
March 31, 2022 |
(dollars in thousands) |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
|
$ |
1,181,885 |
|
|
$ |
11,842 |
|
4.01 |
% |
|
$ |
1,089,781 |
|
|
$ |
10,953 |
|
4.02 |
% |
|
$ |
1,181,885 |
|
|
$ |
11,842 |
|
4.01 |
% |
|
$ |
1,112,108 |
|
|
$ |
10,737 |
|
3.86 |
% |
Residential first mortgages |
|
|
85,030 |
|
|
|
730 |
|
3.43 |
% |
|
|
109,296 |
|
|
|
838 |
|
3.07 |
% |
|
|
85,030 |
|
|
|
730 |
|
3.43 |
% |
|
|
86,805 |
|
|
|
713 |
|
3.29 |
% |
Residential rentals |
|
|
194,972 |
|
|
|
1,999 |
|
4.10 |
% |
|
|
139,080 |
|
|
|
1,410 |
|
4.06 |
% |
|
|
194,972 |
|
|
|
1,999 |
|
4.10 |
% |
|
|
197,312 |
|
|
|
1,831 |
|
3.71 |
% |
Construction and land development |
|
|
30,302 |
|
|
|
361 |
|
4.77 |
% |
|
|
38,315 |
|
|
|
425 |
|
4.44 |
% |
|
|
30,302 |
|
|
|
361 |
|
4.77 |
% |
|
|
33,669 |
|
|
|
407 |
|
4.84 |
% |
Home equity and second mortgages |
|
|
26,101 |
|
|
|
274 |
|
4.20 |
% |
|
|
29,061 |
|
|
|
251 |
|
3.45 |
% |
|
|
26,101 |
|
|
|
274 |
|
4.20 |
% |
|
|
25,946 |
|
|
|
245 |
|
3.78 |
% |
Commercial loans |
|
|
42,744 |
|
|
|
517 |
|
4.84 |
% |
|
|
43,100 |
|
|
|
516 |
|
4.79 |
% |
|
|
42,744 |
|
|
|
517 |
|
4.84 |
% |
|
|
46,668 |
|
|
|
550 |
|
4.71 |
% |
Commercial equipment loans |
|
|
68,349 |
|
|
|
699 |
|
4.09 |
% |
|
|
61,017 |
|
|
|
592 |
|
3.88 |
% |
|
|
68,349 |
|
|
|
699 |
|
4.09 |
% |
|
|
61,715 |
|
|
|
642 |
|
4.16 |
% |
U.S. SBA PPP loans |
|
|
11,847 |
|
|
|
315 |
|
10.64 |
% |
|
|
104,426 |
|
|
|
1,318 |
|
5.05 |
% |
|
|
11,847 |
|
|
|
315 |
|
10.64 |
% |
|
|
20,444 |
|
|
|
452 |
|
8.84 |
% |
Consumer loans |
|
|
4,040 |
|
|
|
35 |
|
3.47 |
% |
|
|
1,425 |
|
|
|
17 |
|
4.77 |
% |
|
|
4,040 |
|
|
|
35 |
|
3.47 |
% |
|
|
3,213 |
|
|
|
33 |
|
4.11 |
% |
Allowance for credit losses |
|
|
(21,375 |
) |
|
|
— |
|
0.00 |
% |
|
|
(18,265 |
) |
|
|
— |
|
0.00 |
% |
|
|
(21,375 |
) |
|
|
— |
|
0.00 |
% |
|
|
(21,043 |
) |
|
|
— |
|
0.00 |
% |
Loan portfolio
(1) |
|
$ |
1,623,895 |
|
|
$ |
16,772 |
|
4.13 |
% |
|
$ |
1,597,236 |
|
|
$ |
16,320 |
|
4.09 |
% |
|
$ |
1,623,895 |
|
|
$ |
16,772 |
|
4.13 |
% |
|
$ |
1,566,837 |
|
|
$ |
15,610 |
|
3.99 |
% |
Taxable investment
securities |
|
|
484,079 |
|
|
|
1,808 |
|
1.49 |
% |
|
|
276,019 |
|
|
|
1,020 |
|
1.48 |
% |
|
|
484,079 |
|
|
|
1,808 |
|
1.49 |
% |
|
|
484,157 |
|
|
|
1,572 |
|
1.30 |
% |
Nontaxable investment
securities |
|
|
21,304 |
|
|
|
117 |
|
2.20 |
% |
|
|
15,559 |
|
|
|
81 |
|
2.08 |
% |
|
|
21,304 |
|
|
|
117 |
|
2.20 |
% |
|
|
17,513 |
|
|
|
94 |
|
2.15 |
% |
Interest-bearing deposits in
other banks |
|
|
23,958 |
|
|
|
63 |
|
1.05 |
% |
|
|
28,844 |
|
|
|
13 |
|
0.18 |
% |
|
|
23,958 |
|
|
|
63 |
|
1.05 |
% |
|
|
42,608 |
|
|
|
60 |
|
0.56 |
% |
Federal funds sold |
|
|
6,178 |
|
|
|
14 |
|
0.91 |
% |
|
|
34,778 |
|
|
|
10 |
|
0.12 |
% |
|
|
6,178 |
|
|
|
14 |
|
0.91 |
% |
|
|
— |
|
|
|
— |
|
0.00 |
% |
Total Interest-Earning
Assets |
|
|
2,159,414 |
|
|
|
18,774 |
|
3.48 |
% |
|
|
1,952,436 |
|
|
|
17,444 |
|
3.57 |
% |
|
|
2,159,414 |
|
|
|
18,774 |
|
3.48 |
% |
|
|
2,111,115 |
|
|
|
17,336 |
|
3.28 |
% |
Cash and cash equivalents |
|
|
28,645 |
|
|
|
|
|
|
|
65,897 |
|
|
|
|
|
|
|
28,645 |
|
|
|
|
|
|
|
116,560 |
|
|
|
|
|
Goodwill |
|
|
10,835 |
|
|
|
|
|
|
|
10,835 |
|
|
|
|
|
|
|
10,835 |
|
|
|
|
|
|
|
10,835 |
|
|
|
|
|
Core deposit intangible |
|
|
888 |
|
|
|
|
|
|
|
1,350 |
|
|
|
|
|
|
|
888 |
|
|
|
|
|
|
|
994 |
|
|
|
|
|
Other assets |
|
|
93,754 |
|
|
|
|
|
|
|
86,421 |
|
|
|
|
|
|
|
93,754 |
|
|
|
|
|
|
|
86,488 |
|
|
|
|
|
Total
Assets |
|
$ |
2,293,536 |
|
|
|
|
|
|
$ |
2,116,939 |
|
|
|
|
|
|
$ |
2,293,536 |
|
|
|
|
|
|
$ |
2,325,992 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand
deposits |
|
$ |
650,249 |
|
|
$ |
— |
|
0.00 |
% |
|
$ |
406,166 |
|
|
$ |
— |
|
0.00 |
% |
|
$ |
650,249 |
|
|
$ |
— |
|
0.00 |
% |
|
$ |
609,945 |
|
|
$ |
— |
|
0.00 |
% |
Interest-bearing deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings |
|
|
120,645 |
|
|
|
15 |
|
0.05 |
% |
|
|
105,814 |
|
|
|
13 |
|
0.05 |
% |
|
|
120,645 |
|
|
|
15 |
|
0.05 |
% |
|
|
121,236 |
|
|
|
15 |
|
0.05 |
% |
Demand deposits |
|
|
571,475 |
|
|
|
431 |
|
0.30 |
% |
|
|
622,544 |
|
|
|
86 |
|
0.06 |
% |
|
|
571,475 |
|
|
|
431 |
|
0.30 |
% |
|
|
625,241 |
|
|
|
103 |
|
0.07 |
% |
Money market deposits |
|
|
385,594 |
|
|
|
103 |
|
0.11 |
% |
|
|
354,657 |
|
|
|
99 |
|
0.11 |
% |
|
|
385,594 |
|
|
|
103 |
|
0.11 |
% |
|
|
|
|
|
0.11 |
% |
Certificates of deposit |
|
|
317,930 |
|
|
|
270 |
|
0.34 |
% |
|
|
344,533 |
|
|
|
442 |
|
0.51 |
% |
|
|
317,930 |
|
|
|
270 |
|
0.34 |
% |
|
|
322,346 |
|
|
|
295 |
|
0.37 |
% |
Total interest-bearing
deposits |
|
|
1,395,644 |
|
|
|
819 |
|
0.23 |
% |
|
|
1,427,548 |
|
|
|
640 |
|
0.18 |
% |
|
|
1,395,644 |
|
|
|
819 |
|
0.23 |
% |
|
|
1,447,604 |
|
|
|
513 |
|
0.14 |
% |
Total Deposits |
|
|
2,045,893 |
|
|
|
819 |
|
0.16 |
% |
|
|
1,833,714 |
|
|
|
640 |
|
0.14 |
% |
|
|
2,045,893 |
|
|
|
819 |
|
0.16 |
% |
|
|
2,057,549 |
|
|
|
513 |
|
0.10 |
% |
Long-term debt |
|
|
3,350 |
|
|
|
22 |
|
2.63 |
% |
|
|
27,273 |
|
|
|
43 |
|
0.63 |
% |
|
|
3,350 |
|
|
|
22 |
|
2.63 |
% |
|
|
12,219 |
|
|
|
25 |
|
0.82 |
% |
Short-term debt |
|
|
5,791 |
|
|
|
16 |
|
1.11 |
% |
|
|
— |
|
|
|
— |
|
0.00 |
% |
|
|
5,791 |
|
|
|
16 |
|
1.11 |
% |
|
|
— |
|
|
|
— |
|
0.00 |
% |
Subordinated Notes |
|
|
19,529 |
|
|
|
252 |
|
5.16 |
% |
|
|
19,473 |
|
|
|
251 |
|
5.16 |
% |
|
|
19,529 |
|
|
|
252 |
|
5.16 |
% |
|
|
19,515 |
|
|
|
251 |
|
5.14 |
% |
Guaranteed preferred
beneficial interest in junior subordinated debentures |
|
|
12,000 |
|
|
|
97 |
|
3.23 |
% |
|
|
12,000 |
|
|
|
75 |
|
2.50 |
% |
|
|
12,000 |
|
|
|
97 |
|
3.23 |
% |
|
|
12,000 |
|
|
|
78 |
|
2.60 |
% |
Total Debt |
|
|
40,670 |
|
|
|
387 |
|
3.81 |
% |
|
|
58,746 |
|
|
|
369 |
|
2.51 |
% |
|
|
40,670 |
|
|
|
387 |
|
3.81 |
% |
|
|
43,734 |
|
|
|
354 |
|
3.24 |
% |
Interest-Bearing
Liabilities |
|
|
1,436,314 |
|
|
|
1,206 |
|
0.34 |
% |
|
|
1,486,294 |
|
|
|
1,009 |
|
0.27 |
% |
|
|
1,436,314 |
|
|
|
1,206 |
|
0.34 |
% |
|
|
1,491,338 |
|
|
|
867 |
|
0.23 |
% |
Total Funds |
|
|
2,086,563 |
|
|
|
1,206 |
|
0.23 |
% |
|
|
1,892,460 |
|
|
|
1,009 |
|
0.21 |
% |
|
|
2,086,563 |
|
|
|
1,206 |
|
0.23 |
% |
|
|
2,101,283 |
|
|
|
867 |
|
0.17 |
% |
Other liabilities |
|
|
16,981 |
|
|
|
|
|
|
|
20,586 |
|
|
|
|
|
|
|
16,981 |
|
|
|
|
|
|
|
20,155 |
|
|
|
|
|
Stockholders' equity |
|
|
189,992 |
|
|
|
|
|
|
|
203,893 |
|
|
|
|
|
|
|
189,992 |
|
|
|
|
|
|
|
204,554 |
|
|
|
|
|
Total Liabilities and
Stockholders' Equity |
|
$ |
2,293,536 |
|
|
|
|
|
|
$ |
2,116,939 |
|
|
|
|
|
|
$ |
2,293,536 |
|
|
|
|
|
|
$ |
2,325,992 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
|
$ |
17,568 |
|
|
|
|
|
$ |
16,435 |
|
|
|
|
|
$ |
17,568 |
|
|
|
|
|
$ |
16,469 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
|
|
|
3.14 |
% |
|
|
|
|
|
3.30 |
% |
|
|
|
|
|
3.14 |
% |
|
|
|
|
|
3.05 |
% |
Net yield on interest-earning
assets |
|
|
|
|
|
3.25 |
% |
|
|
|
|
|
3.37 |
% |
|
|
|
|
|
3.25 |
% |
|
|
|
|
|
3.12 |
% |
Average interest-earning
assets to average interest-bearing liabilities |
|
|
|
|
|
150.34 |
% |
|
|
|
|
|
131.36 |
% |
|
|
|
|
|
150.34 |
% |
|
|
|
|
|
141.56 |
% |
Average loans to average
deposits |
|
|
|
|
|
79.37 |
% |
|
|
|
|
|
87.10 |
% |
|
|
|
|
|
79.37 |
% |
|
|
|
|
|
76.15 |
% |
Average transaction deposits
to total average deposits ** |
|
|
|
|
|
84.46 |
% |
|
|
|
|
|
81.21 |
% |
|
|
|
|
|
84.46 |
% |
|
|
|
|
|
84.33 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of funds |
|
|
|
|
|
0.23 |
% |
|
|
|
|
|
0.21 |
% |
|
|
|
|
|
0.23 |
% |
|
|
|
|
|
0.17 |
% |
Cost of deposits |
|
|
|
|
|
0.16 |
% |
|
|
|
|
|
0.14 |
% |
|
|
|
|
|
0.16 |
% |
|
|
|
|
|
0.10 |
% |
Cost of debt |
|
|
|
|
|
3.81 |
% |
|
|
|
|
|
2.51 |
% |
|
|
|
|
|
3.81 |
% |
|
|
|
|
|
3.24 |
% |
(1) Loan average balance includes non-accrual
loans. There are no tax equivalency adjustments. There were
$43,000, $56,000 and $50,000 of accretion interest for the three
months ended June 30, 2022 and 2021, and March 31, 2022,
respectively.
____________________________________
** Transaction deposits exclude time deposits.
AVERAGE CONSOLIDATED BALANCE SHEETS AND
NET INTEREST INCOME (UNAUDITED)
|
|
For the Six Months Ended June 30, |
|
|
|
2022 |
|
|
|
2021 |
|
(dollars in thousands) |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
|
$ |
1,147,188 |
|
|
$ |
22,579 |
|
3.94 |
% |
|
$ |
1,074,874 |
|
|
$ |
21,648 |
|
4.03 |
% |
Residential first mortgages |
|
|
85,912 |
|
|
|
1,442 |
|
3.36 |
|
|
|
117,097 |
|
|
|
1,752 |
|
2.99 |
|
Residential rentals |
|
|
196,136 |
|
|
|
3,830 |
|
3.91 |
|
|
|
139,150 |
|
|
|
2,855 |
|
4.10 |
|
Construction and land development |
|
|
31,977 |
|
|
|
768 |
|
4.80 |
|
|
|
37,209 |
|
|
|
828 |
|
4.45 |
|
Home equity and second mortgages |
|
|
26,024 |
|
|
|
519 |
|
3.99 |
|
|
|
29,166 |
|
|
|
499 |
|
3.42 |
|
Commercial loans |
|
|
44,696 |
|
|
|
1,068 |
|
4.78 |
|
|
|
43,915 |
|
|
|
1,067 |
|
4.86 |
|
Commercial equipment loans |
|
|
65,050 |
|
|
|
1,341 |
|
4.12 |
|
|
|
60,782 |
|
|
|
1,111 |
|
3.66 |
|
U.S. SBA PPP loans |
|
|
16,122 |
|
|
|
767 |
|
9.51 |
|
|
|
110,183 |
|
|
|
3,120 |
|
5.66 |
|
Consumer loans |
|
|
3,629 |
|
|
|
68 |
|
3.75 |
|
|
|
1,373 |
|
|
|
32 |
|
4.66 |
|
Allowance for credit losses |
|
|
(21,210 |
) |
|
|
— |
|
— |
|
|
|
(18,936 |
) |
|
|
— |
|
— |
|
Loan portfolio
(1) |
|
$ |
1,595,524 |
|
|
$ |
32,382 |
|
4.06 |
|
|
$ |
1,594,813 |
|
|
$ |
32,912 |
|
4.13 |
|
Taxable investment
securities |
|
|
484,118 |
|
|
|
3,379 |
|
1.40 |
|
|
|
253,043 |
|
|
|
1,970 |
|
1.56 |
|
Nontaxable investment
securities |
|
|
19,419 |
|
|
|
211 |
|
2.17 |
|
|
|
18,185 |
|
|
|
195 |
|
2.14 |
|
Interest-bearing deposits in
other banks |
|
|
33,231 |
|
|
|
124 |
|
0.75 |
|
|
|
26,964 |
|
|
|
28 |
|
0.21 |
|
Federal funds sold |
|
|
3,106 |
|
|
|
14 |
|
0.90 |
|
|
|
26,794 |
|
|
|
17 |
|
0.13 |
|
Total Interest-Earning
Assets |
|
|
2,135,398 |
|
|
|
36,110 |
|
3.38 |
|
|
|
1,919,799 |
|
|
|
35,122 |
|
3.66 |
|
Cash and cash equivalents |
|
|
72,359 |
|
|
|
|
|
|
|
74,237 |
|
|
|
|
|
Goodwill |
|
|
10,835 |
|
|
|
|
|
|
|
10,835 |
|
|
|
|
|
Core deposit intangible |
|
|
941 |
|
|
|
|
|
|
|
1,415 |
|
|
|
|
|
Other assets |
|
|
90,069 |
|
|
|
|
|
|
|
87,600 |
|
|
|
|
|
Total
Assets |
|
$ |
2,309,602 |
|
|
|
|
|
|
$ |
2,093,886 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand
deposits |
|
|
630,137 |
|
|
|
— |
|
— |
% |
|
|
393,682 |
|
|
|
— |
|
— |
% |
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Savings |
|
|
120,939 |
|
|
|
30 |
|
0.05 |
|
|
|
103,809 |
|
|
$ |
26 |
|
0.05 |
|
Demand deposits |
|
|
598,210 |
|
|
|
535 |
|
0.18 |
|
|
|
612,745 |
|
|
|
183 |
|
0.06 |
|
Money market deposits |
|
|
382,206 |
|
|
|
203 |
|
0.11 |
|
|
|
352,201 |
|
|
|
197 |
|
0.11 |
|
Certificates of deposit |
|
|
320,126 |
|
|
|
564 |
|
0.35 |
|
|
|
347,930 |
|
|
|
1,036 |
|
0.60 |
|
Total Interest-bearing
deposits |
|
|
1,421,481 |
|
|
|
1,332 |
|
0.19 |
|
|
|
1,416,685 |
|
|
|
1,442 |
|
0.20 |
|
Total Deposits |
|
|
2,051,618 |
|
|
|
1,332 |
|
0.13 |
|
|
|
1,810,367 |
|
|
|
1,442 |
|
0.16 |
|
Long-term debt |
|
|
7,760 |
|
|
|
47 |
|
1.21 |
|
|
|
27,282 |
|
|
|
83 |
|
0.61 |
|
Short-term borrowings |
|
|
2,912 |
|
|
|
16 |
|
1.10 |
|
|
|
— |
|
|
|
— |
|
— |
|
Subordinated Notes |
|
|
19,522 |
|
|
|
503 |
|
5.15 |
|
|
|
19,482 |
|
|
|
503 |
|
5.16 |
|
Guaranteed preferred beneficial interest in junior subordinated
debentures |
|
|
12,000 |
|
|
|
175 |
|
2.92 |
|
|
|
12,000 |
|
|
|
150 |
|
2.50 |
|
Total Debt |
|
|
42,194 |
|
|
|
741 |
|
3.51 |
|
|
|
58,764 |
|
|
|
736 |
|
2.50 |
|
Total Interest-Bearing
Liabilities |
|
|
1,463,675 |
|
|
|
2,073 |
|
0.28 |
|
|
|
1,475,449 |
|
|
|
2,178 |
|
0.30 |
|
Total funds |
|
|
2,093,812 |
|
|
|
2,073 |
|
0.20 |
% |
|
|
1,869,131 |
|
|
|
2,178 |
|
0.23 |
% |
Other liabilities |
|
|
18,557 |
|
|
|
|
|
|
|
22,239 |
|
|
|
|
|
Stockholders' equity |
|
|
197,233 |
|
|
|
|
|
|
|
202,516 |
|
|
|
|
|
Total Liabilities and
Stockholders' Equity |
|
$ |
2,309,602 |
|
|
|
|
|
|
$ |
2,093,886 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
|
$ |
34,037 |
|
|
|
|
|
$ |
32,944 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
|
|
|
3.10 |
% |
|
|
|
|
|
3.36 |
% |
Net yield on interest-earning
assets |
|
|
|
|
|
3.19 |
% |
|
|
|
|
|
3.43 |
% |
Average interest-earning
assets to average interest-bearing liabilities |
|
|
|
|
|
145.89 |
% |
|
|
|
|
|
130.12 |
% |
Average loans to average
deposits |
|
|
|
|
|
77.77 |
% |
|
|
|
|
|
88.09 |
% |
Average transaction deposits
to total average deposits ** |
|
|
|
|
|
84.40 |
% |
|
|
|
|
|
80.78 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of funds |
|
|
|
|
|
0.20 |
% |
|
|
|
|
|
0.23 |
% |
Cost of deposits |
|
|
|
|
|
0.13 |
% |
|
|
|
|
|
0.16 |
% |
Cost of debt |
|
|
|
|
|
3.51 |
% |
|
|
|
|
|
2.50 |
% |
(1) Loan average balance includes non-accrual
loans. There are no tax equivalency adjustments. There were $93,000
and $123,000 of accretion interest during the six months ended
June 30, 2022 and 2021, respectively.
____________________________________
** Transaction deposits exclude time deposits.
SUMMARY OF LOAN PORTFOLIO
(UNAUDITED)
(dollars in thousands)
Portfolio loans, net of deferred costs and fees, are summarized
by type as follows:
|
|
As of ** |
BY LOAN TYPE |
|
June 30, 2022 |
|
% |
|
March 31, 2022 |
|
% |
|
December 31, 2021 |
|
% |
|
September 30, 2021 |
|
% |
|
June 30, 2021 |
|
% |
Portfolio Loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
|
$ |
1,178,758 |
|
|
71.33 |
% |
|
$ |
1,177,761 |
|
|
72.28 |
% |
|
$ |
1,113,793 |
|
|
70.54 |
% |
|
$ |
1,087,102 |
|
|
70.89 |
% |
|
$ |
1,110,011 |
|
|
72.34 |
% |
Residential first mortgages |
|
|
84,782 |
|
|
5.13 |
|
|
|
86,416 |
|
|
5.30 |
|
|
|
92,710 |
|
|
5.87 |
|
|
|
98,590 |
|
|
6.43 |
|
|
|
107,435 |
|
|
7.00 |
|
Residential rentals |
|
|
210,116 |
|
|
12.72 |
|
|
|
191,065 |
|
|
11.73 |
|
|
|
194,911 |
|
|
12.35 |
|
|
|
172,073 |
|
|
11.22 |
|
|
|
142,252 |
|
|
9.27 |
|
Construction and land development |
|
|
31,068 |
|
|
1.88 |
|
|
|
30,649 |
|
|
1.88 |
|
|
|
35,502 |
|
|
2.25 |
|
|
|
37,070 |
|
|
2.42 |
|
|
|
36,839 |
|
|
2.40 |
|
Home equity and second mortgages |
|
|
25,200 |
|
|
1.53 |
|
|
|
26,445 |
|
|
1.62 |
|
|
|
25,661 |
|
|
1.63 |
|
|
|
26,542 |
|
|
1.73 |
|
|
|
28,751 |
|
|
1.87 |
|
Commercial loans |
|
|
43,472 |
|
|
2.63 |
|
|
|
48,948 |
|
|
3.00 |
|
|
|
50,512 |
|
|
3.20 |
|
|
|
48,287 |
|
|
3.15 |
|
|
|
47,530 |
|
|
3.10 |
|
Consumer loans |
|
|
4,511 |
|
|
0.27 |
|
|
|
3,592 |
|
|
0.22 |
|
|
|
3,015 |
|
|
0.19 |
|
|
|
2,183 |
|
|
0.14 |
|
|
|
1,459 |
|
|
0.10 |
|
Commercial equipment |
|
|
74,552 |
|
|
4.51 |
|
|
|
64,662 |
|
|
3.97 |
|
|
|
62,706 |
|
|
3.97 |
|
|
|
61,569 |
|
|
4.02 |
|
|
|
60,132 |
|
|
3.92 |
|
Total portfolio
loans |
|
|
1,652,459 |
|
|
100.00 |
% |
|
|
1,629,538 |
|
|
100.00 |
% |
|
|
1,578,810 |
|
|
100.00 |
% |
|
|
1,533,416 |
|
|
100.00 |
% |
|
|
1,534,409 |
|
|
100.00 |
% |
Less: Allowance for Credit
Losses |
|
|
(21,404 |
) |
|
(1.30 |
) |
|
|
(21,382 |
) |
|
(1.31 |
) |
|
|
(18,417 |
) |
|
(1.17 |
) |
|
|
(18,579 |
) |
|
(1.21 |
) |
|
|
(18,516 |
) |
|
(1.21 |
) |
Total net portfolio
loans |
|
|
1,631,055 |
|
|
|
|
|
1,608,156 |
|
|
|
|
|
1,560,393 |
|
|
|
|
|
1,514,837 |
|
|
|
|
|
1,515,893 |
|
|
|
U.S. SBA PPP loans |
|
|
5,022 |
|
|
|
|
|
15,279 |
|
|
|
|
|
26,398 |
|
|
|
|
|
54,807 |
|
|
|
|
|
86,482 |
|
|
|
Total net
loans |
|
$ |
1,636,077 |
|
|
|
|
$ |
1,623,435 |
|
|
|
|
$ |
1,586,791 |
|
|
|
|
$ |
1,569,644 |
|
|
|
|
$ |
1,602,375 |
|
|
|
____________________________________
** December 31, 2021, September 30, 2021, and
June 30, 2021 reported balance are shown net of deferred costs
and fees to conform with the current period's presentation.
END OF PERIOD CONTRACTUAL RATES
(UNAUDITED)
The following table is based on end of period
("EOP") contractual interest rates and does not include the
amortization of deferred costs and fees or assumptions regarding
non-accrual interest:
|
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
(dollars in thousands) |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
Commercial real estate |
|
4.00 |
% |
|
3.79 |
% |
|
3.79 |
% |
|
3.91 |
% |
|
3.96 |
% |
Residential first
mortgages |
|
3.83 |
% |
|
3.80 |
% |
|
3.80 |
% |
|
3.84 |
% |
|
3.87 |
% |
Residential rentals |
|
4.03 |
% |
|
3.78 |
% |
|
3.81 |
% |
|
3.97 |
% |
|
4.11 |
% |
Construction and land
development |
|
4.57 |
% |
|
4.36 |
% |
|
4.38 |
% |
|
4.32 |
% |
|
4.31 |
% |
Home equity and second
mortgages |
|
4.19 |
% |
|
3.50 |
% |
|
3.51 |
% |
|
3.51 |
% |
|
3.50 |
% |
Commercial loans |
|
4.79 |
% |
|
4.47 |
% |
|
4.48 |
% |
|
4.48 |
% |
|
4.44 |
% |
Consumer loans |
|
5.13 |
% |
|
4.33 |
% |
|
4.37 |
% |
|
5.26 |
% |
|
5.65 |
% |
Commercial equipment |
|
4.30 |
% |
|
4.29 |
% |
|
4.32 |
% |
|
4.39 |
% |
|
4.42 |
% |
U.S. SBA PPP loans |
|
1.00 |
% |
|
1.00 |
% |
|
1.00 |
% |
|
1.00 |
% |
|
1.00 |
% |
Total
Loans |
|
4.04 |
% |
|
3.81 |
% |
|
3.80 |
% |
|
3.85 |
% |
|
3.84 |
% |
|
|
|
|
|
|
|
|
|
|
|
Yields without U.S.
SBA PPP Loans |
|
4.05 |
% |
|
3.85 |
% |
|
3.84 |
% |
|
3.95 |
% |
|
4.00 |
% |
|
|
ALLOWANCE FOR CREDIT LOSSES AND ALLOWANCE
FOR LOAN LOSSES (UNAUDITED)
(dollars in thousands)
|
|
For the Three Months Ended** |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
Beginning of period |
|
$ |
21,382 |
|
|
$ |
18,417 |
|
|
$ |
18,579 |
|
|
$ |
18,516 |
|
|
$ |
18,256 |
|
|
|
|
|
|
|
|
|
|
|
|
Impact of ASC 326
Adoption |
|
|
— |
|
|
|
2,496 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Charge-offs |
|
|
(446 |
) |
|
|
— |
|
|
|
(181 |
) |
|
|
(491 |
) |
|
|
(61 |
) |
Recoveries |
|
|
43 |
|
|
|
19 |
|
|
|
19 |
|
|
|
554 |
|
|
|
30 |
|
Net charge-offs |
|
|
(403 |
) |
|
|
19 |
|
|
|
(162 |
) |
|
|
63 |
|
|
|
(31 |
) |
|
|
|
|
|
|
|
|
|
|
|
Provision for credit
losses |
|
|
425 |
|
|
|
450 |
|
|
|
— |
|
|
|
— |
|
|
|
291 |
|
End of period |
|
$ |
21,404 |
|
|
$ |
21,382 |
|
|
$ |
18,417 |
|
|
$ |
18,579 |
|
|
$ |
18,516 |
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs to average
portfolio loans (annualized)2 |
|
|
(0.10 |
)% |
|
|
— |
% |
|
|
(0.04 |
)% |
|
|
0.02 |
% |
|
|
(0.01 |
)% |
|
|
|
|
|
|
|
|
|
|
|
Breakdown of general and specific allowance as a
percentage of total portfolio
loans2 |
General allowance |
|
$ |
21,108 |
|
|
$ |
21,087 |
|
|
$ |
18,151 |
|
|
$ |
18,256 |
|
|
$ |
17,738 |
|
Specific allowance |
|
|
296 |
|
|
|
295 |
|
|
|
266 |
|
|
|
323 |
|
|
|
778 |
|
|
|
$ |
21,404 |
|
|
$ |
21,382 |
|
|
$ |
18,417 |
|
|
$ |
18,579 |
|
|
$ |
18,516 |
|
|
|
|
|
|
|
|
|
|
|
|
General allowance |
|
|
1.28 |
% |
|
|
1.29 |
% |
|
|
1.15 |
% |
|
|
1.19 |
% |
|
|
1.15 |
% |
Specific allowance |
|
|
0.02 |
% |
|
|
0.02 |
% |
|
|
0.02 |
% |
|
|
0.02 |
% |
|
|
0.05 |
% |
Allowance to total portfolio
loans |
|
|
1.30 |
% |
|
|
1.31 |
% |
|
|
1.17 |
% |
|
|
1.21 |
% |
|
|
1.20 |
% |
|
|
|
|
|
|
|
|
|
|
|
Allowance to non-acquired
loans |
|
n/a(1) |
|
n/a(1) |
|
|
1.20 |
% |
|
|
1.25 |
% |
|
|
1.25 |
% |
|
|
|
|
|
|
|
|
|
|
|
Allowance + Non-PCI FV
Mark |
|
n/a(1) |
|
n/a(1) |
|
$ |
18,815 |
|
|
$ |
19,070 |
|
|
$ |
19,090 |
|
Allowance + Non-PCI FV Mark to
total portfolio loans |
|
n/a(1) |
|
n/a(1) |
|
|
1.19 |
% |
|
|
1.24 |
% |
|
|
1.24 |
% |
____________________________________
** The Company implemented the CECL accounting standard
effective January 1, 2022. The Company used an incurred loss
methodology for quarters displayed before March 31, 2022.
(1) Allowance to non-acquired loans and Non-PCI
FV Mark are no longer relevant as all the ACL considers all loan
portfolios.
(2) Allowance to non-acquired loans is no longer relevant as the
ACL considers all portfolio loans.
CLASSIFIED AND SPECIAL MENTION
ASSETS3
(UNAUDITED)
The following is a breakdown of the Company’s classified and
special mention assets at June 30, 2022, March 31,
2022 and December 31, 2021, 2020, 2019, and 2018,
respectively:
|
|
As of |
(dollars in thousands) |
|
6/30/2022 |
|
3/31/2022 |
|
12/31/2021 |
|
12/31/2020 |
|
12/31/2019 |
|
12/31/2018 |
Classified loans |
|
|
|
|
|
|
|
|
|
|
|
|
Substandard |
|
$ |
6,062 |
|
|
$ |
4,745 |
|
|
$ |
5,211 |
|
|
$ |
19,249 |
|
|
$ |
26,863 |
|
|
$ |
32,226 |
|
Doubtful |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total classified loans |
|
|
6,062 |
|
|
|
4,745 |
|
|
|
5,211 |
|
|
|
19,249 |
|
|
|
26,863 |
|
|
|
32,226 |
|
Special mention loans |
|
|
160 |
|
|
|
— |
|
|
|
— |
|
|
|
7,672 |
|
|
|
— |
|
|
|
— |
|
Total classified and special
mention loans |
|
$ |
6,222 |
|
|
$ |
4,745 |
|
|
$ |
5,211 |
|
|
$ |
26,921 |
|
|
$ |
26,863 |
|
|
$ |
32,226 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Classified loans |
|
$ |
6,062 |
|
|
$ |
4,745 |
|
|
$ |
5,211 |
|
|
$ |
19,249 |
|
|
$ |
26,863 |
|
|
$ |
32,226 |
|
Classified securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
482 |
|
Other real estate owned |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,109 |
|
|
|
7,773 |
|
|
|
8,111 |
|
Total classified assets |
|
$ |
6,062 |
|
|
$ |
4,745 |
|
|
$ |
5,211 |
|
|
$ |
22,358 |
|
|
$ |
34,636 |
|
|
$ |
40,819 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total classified
assets as a percentage of total assets |
|
|
0.26 |
% |
|
|
0.20 |
% |
|
|
0.22 |
% |
|
|
1.10 |
% |
|
|
1.93 |
% |
|
|
2.42 |
% |
Total classified
assets as a percentage of Risk Based Capital |
|
|
2.35 |
% |
|
|
1.87 |
% |
|
|
2.10 |
% |
|
|
9.61 |
% |
|
|
16.21 |
% |
|
|
21.54 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUMMARY OF DEPOSITS
(UNAUDITED)
|
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
September 30, 2021 |
|
June 30, 2021 |
(dollars in thousands) |
|
Balance |
|
% |
|
Balance |
|
% |
|
Balance |
|
% |
|
Balance |
|
% |
|
Balance |
|
% |
Noninterest-bearing demand |
|
$ |
635,649 |
|
30.48 |
% |
|
$ |
644,385 |
|
30.75 |
% |
|
$ |
445,778 |
|
21.68 |
% |
|
$ |
432,606 |
|
21.58 |
% |
|
$ |
423,165 |
|
22.18 |
% |
Interest-bearing: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
|
635,344 |
|
30.47 |
% |
|
|
618,869 |
|
29.54 |
% |
|
|
790,481 |
|
38.45 |
% |
|
|
764,482 |
|
38.14 |
% |
|
|
685,023 |
|
35.90 |
% |
Money market deposits |
|
|
380,712 |
|
18.26 |
% |
|
|
387,700 |
|
18.51 |
% |
|
|
372,717 |
|
18.13 |
% |
|
|
355,582 |
|
17.74 |
% |
|
|
351,262 |
|
18.41 |
% |
Savings |
|
|
119,363 |
|
5.72 |
% |
|
|
124,038 |
|
5.92 |
% |
|
|
119,767 |
|
5.82 |
% |
|
|
112,282 |
|
5.60 |
% |
|
|
107,288 |
|
5.62 |
% |
Certificates of deposit |
|
|
314,308 |
|
15.07 |
% |
|
|
320,091 |
|
15.28 |
% |
|
|
327,421 |
|
15.92 |
% |
|
|
339,655 |
|
16.94 |
% |
|
|
341,400 |
|
17.89 |
% |
Total interest-bearing |
|
|
1,449,727 |
|
69.52 |
% |
|
|
1,450,698 |
|
69.25 |
% |
|
|
1,610,386 |
|
78.32 |
% |
|
|
1,572,001 |
|
78.42 |
% |
|
|
1,484,973 |
|
77.82 |
% |
Total Deposits |
|
$ |
2,085,376 |
|
100.00 |
% |
|
$ |
2,095,083 |
|
100.00 |
% |
|
$ |
2,056,164 |
|
100.00 |
% |
|
$ |
2,004,607 |
|
100.00 |
% |
|
$ |
1,908,138 |
|
100.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction
accounts |
|
$ |
1,771,068 |
|
84.93 |
% |
|
$ |
1,774,992 |
|
84.72 |
% |
|
$ |
1,728,743 |
|
84.08 |
% |
|
$ |
1,664,952 |
|
83.06 |
% |
|
$ |
1,566,738 |
|
82.11 |
% |
|
_______________________________________
1 The Company implemented the CECL accounting standard
effective January 1, 2022. The Company used an incurred loss
methodology for all periods compared before March 31, 2022.
2 Portfolio loans include all loan portfolios except the
U.S. SBA PPP loan portfolio
3 Classified loans are not net
of deferred costs and fees before the quarter ended March 31,
2022.
Grafico Azioni Community Financial (NASDAQ:TCFC)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni Community Financial (NASDAQ:TCFC)
Storico
Da Set 2023 a Set 2024