MARTINS FERRY, Ohio,
May 1, 2020 /PRNewswire/ -- United
Bancorp, Inc. (NASDAQ: UBCP) reported diluted earnings per share of
$0.28 and net income of $1,579,000 for the three months ended
March 31, 2020, as compared to
$0.28 and $1,614,000, respectively, for the corresponding
three-month period in 2019. Even though the Company achieved
the same level of earnings on a year-over-year basis, first quarter
earnings were negatively impacted by a higher provision for loan
losses in recognition of the unprecedented economic environment in
which it is presently operating due to the global COVID-19
pandemic.
Randall M. Greenwood, Senior Vice
President, CFO and Treasurer remarked, "In light of recent events,
we are pleased to report on our overall solid financial performance
for the quarter ended March 31,
2020. As noted above, our Company achieved diluted earnings
per share of $0.28 in the first
quarter of 2020 ---which was the same level as the previous year---
even though we booked an additional $473,000 of loan loss provision to give proper
recognition to the risks posed to our Company by the COVID-19
pandemic. Significantly contributing to our achievement of a
sound level of earnings this past quarter was the solid growth that
our Company experienced in its earning assets on a year-over-year
basis. Year-over-year, gross loans increased by $34.4 million, or 8.3%, and securities and other
restricted stock increased by $57.5
million or 39.8%. This strong growth in our earning
assets, along with robust loan fee generation during the first
quarter of this year, led to an increase in total interest income
of $1.0 million, or 15.9%, over the
previous year. As we have formerly disclosed, our Company
started to position its balance sheet to be more liability
sensitive over the course of the past year in response to the
FOMC's sudden change in the direction of monetary policy, which
helped to control overall interest expense levels. Even with
this change, interest expense did increase by $478,000 over last year's level. But, with
our focus on both growing assets and aggressively managing our
sensitivity, our Company saw a year-over-year increase in its net
interest income of $525,000 or
10.3%. As of March 31, 2020,
our Company's net interest margin was 3.76%, which compares very
favorably to our peer and is relatively stable compared to the
previous year."
Greenwood continued, "Even though we fully realize that the
present pandemic situation has the potential to change our
qualitative metrics relating to credit, we have successfully
maintained overall strength and stability within our loan portfolio
as of March 31, 2020.
Year-over-year, our Company continues to have very solid credit
quality-related metrics supported by a relatively low level of
nonaccrual loans and loans past due 30 plus days, which were
$2.6 million, or 0.58 percent of
total loans at quarter end versus $3.5
million and .85%, respectively, the previous year.
Further, net loans charged off, excluding overdrafts, was
$63,000, or .06% annualized.
With our additional provision for loan losses this past quarter,
our total allowance for loan losses increased ten basis points on a
year-over-year basis to a level of 0.60% and our total allowance
for loan losses to nonperforming loans was 146.4%, which was up
over the previous year by 14.2%. We are committed under the
present situation with which we are confronted to closely work with
our valued loan customers to keep their loans current by adopting
payment relief practices fully supported by both regulatory and
accounting guidance, which has evolved over the course of recent
weeks. We are hopeful that these positive actions will allow
our customers to weather this present storm and our Company to
maintain overall sound credit quality. Obviously, time will
ultimately bear this out." Greenwood further stated, "Our
Company continues to have very sound levels of capital. As
previously announced in the second quarter of last year, we
enhanced our capital levels by issuing $20.0
million in subordinated debt at very favorable terms.
Even though this capital is only measured at the bank-level, it has
provided some very welcome cushion during these very challenging
times. Overall, our Company saw shareholders' equity grow by
$9.1 million, or 17.0%,
year-over-year, and its book value increase (on a percentage basis)
by the same amount to a level of $10.75."
Scott A. Everson, President and
CEO stated, "It is truly amazing how quickly things can change on a
global basis. The COVID-19 pandemic has had a tremendous and
negative impact on all of us. Our thoughts and prayers go out
to everyone as we work to navigate through this unimaginable time
and come to some semblance of normalcy, once again. I am
extremely grateful that both our valued employees and customers
have adapted to the modified operating structure that we adopted
during the latter half of the first quarter. Our number one
priority at this time is to protect the health and welfare of our
team members and customer base while delivering the highest quality
of service possible under the circumstances. We are blessed
to have both systems and personnel capable of enacting quick change
in our delivery, which has led to results that are similar to those
when we are fully functional as a community bank. Being
observant of both the stay-at-home orders and best practices
guidance being provided by governmental authorities, many of our
team members are currently working from home. In addition,
delivery of our services is primarily being conducted at our
drive-ups or through electronic/ digital channels. Despite
all of the challenges with which we are presently confronted, our
Company produced very solid earnings results in the first quarter
of 2020… even with the additional loan loss provision expense of
$473,000, which was over six times
the level that we allocated the previous year. Prior to the
stay-at-home order and pandemic spread, our loan production team
had an excellent quarter of loan generation as evidenced by the
$322,000 increase in loan fees
quarter-over-quarter." Everson concluded, "Our Company has
always had a long-term view, predicated on sound underwriting
practices, superior customer service and prudent liquidity and
capital management, which has served us well through various
operating environments. We are confident that this operating
philosophy will, once again, prove to be sound as we support our
customers and work through this present crisis; therefore,
protecting our shareholder value."
As of March 31, 2020, United
Bancorp, Inc. has total assets of $715.8
million and total shareholders' equity of $62.9 million. Through its single bank
charter, Unified Bank, the Company currently has
nineteen banking offices that serve the Ohio Counties of Athens, Belmont, Carroll, Fairfield, Harrison, Jefferson and Tuscarawas. The Company also operates a Loan
Production Office in Wheeling, WV.
United Bancorp, Inc. trades on the NASDAQ Capital Market tier
of the NASDAQ Stock Market under the symbol UBCP, Cusip
#909911109.
Certain statements contained herein are not based on historical
facts and are "forward-looking statements" within the meaning of
Section 21A of the Securities Exchange Act of 1934.
Forward-looking statements, which are based on various assumptions
(some of which are beyond the Company's control), may be identified
by reference to a future period or periods, or by the use of
forward-looking terminology, such as "may," "will," "believe,"
"expect," "estimate," "anticipate," "continue," or similar terms or
variations on those terms, or the negative of these terms.
Actual results could differ materially from those set forth in
forward-looking statements, due to a variety of factors, including,
but not limited to, those related to the economic environment,
particularly in the market areas in which the company operates,
competitive products and pricing, fiscal and monetary policies of
the U.S. Government, changes in government regulations affecting
financial institutions, including regulatory fees and capital
requirements, changes in prevailing interest rates, acquisitions
and the integration of acquired businesses, credit risk management,
asset/liability management, changes in the financial and securities
markets, including changes with respect to the market value of our
financial assets, and the availability of and costs
associated with sources of liquidity. The Company undertakes
no obligation to update or carry forward-looking statements,
whether as a result of new information, future events or
otherwise.
|
UNITED BANCORP,
INC.
|
|
|
|
|
|
"UBCP"
|
|
|
|
|
|
At or for the
Quarter Ended
|
|
|
|
|
|
March
31,
|
|
March
31,
|
|
%
|
|
$
|
|
2020
|
|
2019
|
|
Change
|
|
Change
|
Earnings
|
|
|
|
|
|
|
|
Interest income on
loans
|
$
5,330,034
|
|
$
5,045,302
|
|
5.64%
|
|
$
284,732
|
Loan fees
|
512,135
|
|
190,316
|
|
169.10%
|
|
$
321,819
|
Interest income on
securities
|
1,476,745
|
|
1,079,566
|
|
36.79%
|
|
$
397,179
|
Total interest income
|
7,318,914
|
|
6,315,184
|
|
15.89%
|
|
$
1,003,730
|
Total interest expense
|
1,685,435
|
|
1,207,188
|
|
39.62%
|
|
$
478,247
|
Net interest income
|
5,633,479
|
|
5,107,996
|
|
10.29%
|
|
$
525,483
|
Provision for loan losses
|
563,000
|
|
90,000
|
|
525.56%
|
|
$
473,000
|
Net interest income after provision for loan losses
|
5,070,479
|
|
5,017,996
|
|
1.05%
|
|
$
52,483
|
Service charge on deposit account
|
659,147
|
|
713,294
|
|
-7.59%
|
|
$
(54,147)
|
Net realized gains on sale of loans
|
6,032
|
|
3,804
|
|
58.57%
|
|
$
2,228
|
Other noninterest income
|
379,730
|
|
227,850
|
|
66.66%
|
|
$
151,880
|
Total noninterest income
|
1,044,909
|
|
944,948
|
|
10.58%
|
|
$
99,961
|
Total noninterest expense
|
4,410,582
|
|
4,162,328
|
|
5.96%
|
|
$
248,254
|
Income tax expense
|
125,642
|
|
187,008
|
|
-32.81%
|
|
$
(61,366)
|
Net income
|
$
1,579,164
|
|
$
1,613,608
|
|
-2.13%
|
|
$
(34,444)
|
Key performance
data
|
|
|
|
|
|
|
|
Earnings per common share - Basic
|
$
0.28
|
|
$
0.28
|
|
0.00%
|
|
$
-
|
Earnings per common share - Diluted
|
0.28
|
|
0.28
|
|
0.00%
|
|
$
-
|
Cash dividends paid
|
0.1425
|
|
0.1325
|
|
7.55%
|
|
$
0.01000
|
Stock
data
|
|
|
|
|
|
|
|
Dividend payout ratio
|
50.89%
|
|
47.32%
|
|
3.57%
|
|
|
Price earnings ratio
|
10.58
|
x
|
9.69
|
x
|
9.17%
|
|
|
Market price to book value
|
103%
|
|
118%
|
|
-13.17%
|
|
|
Annualized yield based on quarter end close
|
5.17%
|
|
4.88%
|
|
5.94%
|
|
|
Market value - last close (end of period)
|
11.02
|
|
10.85
|
|
1.57%
|
|
|
Book value (end of period)
|
10.75
|
|
9.19
|
|
16.97%
|
|
|
Shares
Outstanding
|
|
|
|
|
|
|
|
Average - Basic
|
5,463,739
|
|
5,515,418
|
|
--------
|
|
|
Average - Diluted
|
5,463,739
|
|
5,515,418
|
|
--------
|
|
|
Common stock, shares issued
|
5,959,351
|
|
5,897,227
|
|
--------
|
|
|
Shares held as treasury stock
|
79,593
|
|
29,624
|
|
--------
|
|
|
Return on average assets (ROA)
|
0.91%
|
|
1.08%
|
|
-0.17%
|
|
|
Return on average equity (ROE)
|
10.03%
|
|
12.00%
|
|
-1.96%
|
|
|
At quarter
end
|
|
|
|
|
|
|
|
Total assets
|
$
715,821,865
|
|
$
621,007,755
|
|
15.27%
|
|
$
94,814,110
|
Total assets (average)
|
693,400,000
|
|
599,312,000
|
|
15.70%
|
|
$
94,088,000
|
Cash and due from Federal
Reserve Bank
|
28,042,242
|
|
32,692,099
|
|
-14.22%
|
|
$
(4,649,857)
|
Average cash and due from
Federal Reserve Bank
|
10,850,000
|
|
21,723,000
|
|
-50.05%
|
|
$
(10,873,000)
|
Securities and other
restricted stock
|
201,853,626
|
|
144,329,961
|
|
39.86%
|
|
$
57,523,665
|
Average securities and other
restricted stock
|
193,449,000
|
|
131,402,000
|
|
47.22%
|
|
$
62,047,000
|
Other real estate and repossessions
|
818,450
|
|
91,000
|
|
799.40%
|
|
$
727,450
|
Gross loans
|
448,336,574
|
|
413,896,086
|
|
8.32%
|
|
$
34,440,488
|
Allowance for loan losses
|
(2,708,559)
|
|
(2,083,480)
|
|
30.00%
|
|
$
(625,079)
|
Net loans
|
445,628,015
|
|
411,812,606
|
|
8.21%
|
|
$
33,815,409
|
Average loans
|
444,116,000
|
|
412,671,000
|
|
7.62%
|
|
$
31,445,000
|
Net loans charged-off
|
63,290
|
|
18,420
|
|
243.59%
|
|
$
44,870
|
Net overdrafts charged-off
|
22,268
|
|
30,988
|
|
-28.14%
|
|
$
(8,720)
|
Total net charge offs
|
85,558
|
|
49,408
|
|
73.17%
|
|
$
36,150
|
Nonaccrual loans
|
1,850,476
|
|
1,576,045
|
|
17.41%
|
|
$
274,431
|
Loans past due 30+ days (excludes non accrual loans)
|
765,019
|
|
1,953,368
|
|
-60.84%
|
|
$
(1,188,349)
|
Total Deposits
|
|
|
|
|
|
|
|
Noninterest bearing demand
|
104,010,945
|
|
102,447,401
|
|
1.53%
|
|
$
1,563,544
|
Interest
bearing demand
|
241,437,588
|
|
212,620,075
|
|
13.55%
|
|
$
28,817,513
|
Savings
|
111,065,936
|
|
110,923,522
|
|
0.13%
|
|
$
142,414
|
Time <
$250,000
|
86,723,750
|
|
94,268,487
|
|
-8.00%
|
|
$
(7,544,737)
|
Time >
$250,000
|
12,279,625
|
|
18,671,486
|
|
-34.23%
|
|
$
(6,391,861)
|
Total Deposits
|
555,517,844
|
|
538,930,971
|
|
3.08%
|
|
$
16,586,873
|
Average total deposits
|
547,025,000
|
|
526,632,000
|
|
3.87%
|
|
$
20,393,000
|
Advances from the Federal Home Loan Bank
|
51,000,000
|
|
79,505
|
|
64046.91%
|
|
$
50,920,495
|
Overnight
advances
|
11,000,000
|
|
-
|
|
N/A
|
|
$
11,000,000
|
Term
advances
|
40,000,000
|
|
79,505
|
|
50211.30%
|
|
$
39,920,495
|
Repurchase Agreements
|
14,587,355
|
|
13,440,580
|
|
8.53%
|
|
$
1,146,775
|
Shareholders' equity
|
62,948,669
|
|
53,786,271
|
|
17.03%
|
|
$
9,162,398
|
Shareholders' equity (average)
|
62,988,000
|
|
53,786,000
|
|
17.11%
|
|
$
9,202,000
|
Key performance
ratios
|
|
|
|
|
|
|
|
Net interest margin (Federal tax equivalent)
|
3.76%
|
|
3.80%
|
|
-0.04%
|
|
|
Interest expense to average assets
|
0.97%
|
|
0.81%
|
|
0.16%
|
|
|
Total allowance for loan losses
|
|
|
|
|
|
|
|
to nonperforming
loans
|
146.37%
|
|
132.20%
|
|
14.17%
|
|
|
Total allowance for loan losses
|
|
|
|
|
|
|
|
to total
loans
|
0.60%
|
|
0.50%
|
|
0.10%
|
|
|
Total
past due and nonaccrual loans to gross loans
|
0.58%
|
|
0.85%
|
|
-0.27%
|
|
|
Nonperforming assets to total assets
|
0.37%
|
|
0.27%
|
|
0.10%
|
|
|
Net
charge-offs to average loans
|
0.08%
|
|
0.05%
|
|
0.03%
|
|
|
Equity
to assets at period end
|
8.79%
|
|
8.66%
|
|
0.13%
|
|
|
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SOURCE United Bancorp, Inc.