SBFG 8-K
Sb Financial Group, Inc. (SBFG)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 2, 2023
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Item 2.02. Results of Operations and Financial Condition.
On October 30, 2023, SB Financial Group, Inc. (the “Company”) issued a news release reporting financial results for the third quarter 2023. A copy of the October 30, 2023 news release is furnished as Exhibit 99.1 and is incorporated herein by reference.
The information in this Item 2.02, including Exhibit 99.1 furnished herewith, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.
Item 9.01. Financial Statements and Exhibits.
(a) Not Applicable
(b) Not Applicable
(c) Not Applicable
(d) Exhibits
| Exhibit No. | Description | |
| 99.1 | News release issued by SB Financial Group, Inc. on October 30, 2023, reporting financial results for the third quarter 2023. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SB FINANCIAL GROUP, INC. | ||
| Dated: November 2, 2023 | By: | /s/ Anthony V. Cosentino |
| Anthony V. Cosentino | ||
| Chief Financial Officer | ||
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INDEX TO EXHIBITS
Current Report on Form 8-K
Dated November 2, 2023
SB Financial Group, Inc.
| Exhibit No. | Description | |
| 99.1 | News release issued by SB Financial Group, Inc. on October 30, 2023, reporting financial results for the third quarter 2023. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
3
Exhibit 99.1
SB Financial Group Announces Third Quarter 2023 Results
DEFIANCE, OH, October 30, 2023 -- SB Financial Group, Inc. (NASDAQ: SBFG) (“SB Financial” or the “Company”), a diversified financial services company providing full-service community banking, mortgage banking, wealth management, private client and title insurance services today reported earnings for the third quarter ended September 30, 2023.
Third quarter 2023 highlights over the third quarter prior year include:
| ● | Net income of $2.7 million decreased 19.6 percent with diluted earnings per share (“EPS”) of $0.39 and down to the linked quarter by 12.6 percent |
| ● | Asset quality remained stable, with 30 basis points of non-performing assets and net charge-offs of just $5 thousand in the quarter |
| ● | Coverage of our non-performing loans by the allowance improved by 29 percent to 474 percent |
| ● | Loans were higher from both the prior year and linked quarters and the portfolio has now grown for 7 consecutive quarters |
Nine months ended September 30, 2023, highlights over prior-year nine months include:
| ● | Net income of $8.2 million, down 8.6 percent |
| ● | Adjusted for OMSR recapture, net income is higher by 2.4 percent |
| ● | Noninterest expense of $31.6 million declined 1.4 percent |
| ● | Total net charge-offs year-to-date of just $88 thousand or 0.01 percent of total loans |
Third quarter 2023 trailing twelve-month highlights include:
| ● | Loan growth of $63.8 million, or 6.9 percent |
| ● | Deposit growth remained steady compared to the prior year but increased over the linked quarter by $14.2 million. Deposit costs have increased from the prior year by $8.3 million with the deposit cost of funds reaching 1.53 percent |
| Earnings Highlights | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| ($ in thousands, except per share & ratios) | Sep. 2023 | Sep. 2022 | % Change | Sep. 2023 | Sep. 2022 | % Change | ||||||||||||||||||
| Operating revenue | $ | 13,699 | $ | 14,473 | -5.3 | % | $ | 41,879 | $ | 43,017 | -2.6 | % | ||||||||||||
| Interest income | 14,796 | 11,764 | 25.8 | % | 43,026 | 31,632 | 36.0 | % | ||||||||||||||||
| Interest expense | 5,260 | 1,334 | 294.3 | % | 13,337 | 3,133 | 325.7 | % | ||||||||||||||||
| Net interest income | 9,536 | 10,430 | -8.6 | % | 29,689 | 28,499 | 4.2 | % | ||||||||||||||||
| Provision for credit losses | (6 | ) | - | 0.0 | % | 389 | - | 0.0 | % | |||||||||||||||
| Noninterest income | 4,163 | 4,043 | 3.0 | % | 12,190 | 14,518 | -16.0 | % | ||||||||||||||||
| Noninterest expense | 10,481 | 10,384 | 0.9 | % | 31,593 | 32,046 | -1.4 | % | ||||||||||||||||
| Net income | 2,687 | 3,343 | -19.6 | % | 8,212 | 8,988 | -8.6 | % | ||||||||||||||||
| Earnings per diluted share | 0.39 | 0.47 | -17.0 | % | 1.18 | 1.27 | -7.1 | % | ||||||||||||||||
| Return on average assets | 0.80 | % | 1.03 | % | -22.3 | % | 0.81 | % | 0.91 | % | -11.0 | % | ||||||||||||
| Return on average equity | 8.73 | % | 10.89 | % | -19.8 | % | 8.72 | % | 9.21 | % | -5.3 | % | ||||||||||||
“Funding costs continued to be headwinds for us in the quarter, however we are pleased that we were still able to grow our deposit base from the linked quarter, despite that higher cost” said Mark A. Klein, Chairman, President, and CEO of SB Financial. “Our asset quality continued to be peer leading and our allowance percentage at 1.60 percent provides critical stability and strength as we move forward into a potentially tougher economic environment.”
RESULTS OF OPERATIONS
Consolidated Revenue
Total interest income for the third quarter was up $3.0 million or 25.8 percent from the prior year and from the linked quarter was up nearly 11 percent on an annualized basis, as the yield on earning assets increased 89 basis points to 4.78 percent. However, deposit and other funding costs have risen at a faster pace, reducing net interest margin to 3.08 percent, down 37 basis points compared to the prior year and 7 basis points compared to the linked quarter.
Noninterest income was up from the prior year but down compared to the linked quarter, reflecting higher margins from gain on sale and relative growth in the mortgage sector, offset by weakness in our SBA volume and gain on sale. Wealth management revenues are under pressure from weaker equity markets and a reduction in client assets. For the full year, adjusting for the OMSR recapture, total noninterest income decreased $1.1 million or 8.2 percent due to our mortgage origination and sale volume being lower by 32.7 and 20.7 percent, respectively.
Mortgage Loan Business
Mortgage loan originations for the third quarter of 2023 were $61.2 million, down $7.4 million, or 10.7 percent, from the prior year quarter. Total sales of originated loans increased compared to the prior year, reaching $54.1 million, up $14.9 million, or 38.1 percent as we adjusted pricing and reduced duration risk in order to transition from portfolio production.
Net mortgage banking revenue, comprising gains on the sale of mortgage loans and net loan servicing fees, totaled $1.6 million for the third quarter, up from $1.4 million for the prior year quarter and slightly higher from the linked quarter. The mortgage servicing valuation adjustment was a negative $0.1 million, compared to a positive adjustment of $0.1 million for the prior year quarter. The servicing portfolio at September 30, 2023, was $1.37 billion, an increase of $4.5 million compared to the prior year.
Mr. Klein noted, “Our mortgage volume has remained below historical levels as we adjust to a much higher interest rate environment and limited movement of housing inventory and resulting mortgage activity. Historically, we have seen 20 to 30 percent of our volume from refinance transactions, which is down this year to just 9 percent, further impacting production levels.”
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| Mortgage Banking | Annual | |||||||||||||||||||||||
| ($ in thousands) | Sep. 2023 | Jun. 2023 | Mar. 2023 | Dec. 2022 | Sep. 2022 | Growth | ||||||||||||||||||
| Mortgage originations | $ | 61,200 | $ | 65,387 | $ | 49,366 | $ | 51,219 | $ | 68,557 | $ | (7,357 | ) | |||||||||||
| Mortgage sales | 54,085 | 47,933 | 25,803 | 23,590 | 39,176 | 14,909 | ||||||||||||||||||
| Mortgage servicing portfolio | 1,367,209 | 1,353,904 | 1,344,158 | 1,352,016 | 1,362,666 | 4,543 | ||||||||||||||||||
| Mortgage servicing rights | 13,893 | 13,723 | 13,548 | 13,503 | 13,473 | 420 | ||||||||||||||||||
| Mortgage servicing revenue | ||||||||||||||||||||||||
| Loan servicing fees | 850 | 844 | 844 | 851 | 858 | (8 | ) | |||||||||||||||||
| OMSR amortization | (334 | ) | (334 | ) | (292 | ) | (310 | ) | (396 | ) | 62 | |||||||||||||
| Net administrative fees | 516 | 510 | 552 | 541 | 462 | 54 | ||||||||||||||||||
| OMSR valuation adjustment | (78 | ) | (16 | ) | 56 | 86 | 65 | (143 | ) | |||||||||||||||
| Net loan servicing fees | 438 | 494 | 608 | 627 | 527 | (89 | ) | |||||||||||||||||
| Gain on sale of mortgages | 1,207 | 1,056 | 599 | 550 | 876 | 331 | ||||||||||||||||||
| Mortgage banking revenue, net | $ | 1,645 | $ | 1,550 | $ | 1,207 | $ | 1,177 | $ | 1,403 | $ | 242 | ||||||||||||
Noninterest Income and Noninterest Expense
Noninterest income for the quarter increased from the prior year quarter by 3.0 percent and was just slightly below the linked quarter. Gain-on-sale from mortgage loans, was up $0.3 million or 37.8 percent from the prior year. Our sale percentage of originated volume returned to more historical levels with the 88 percent achieved for the quarter marking our highest since early 2020.
For the third quarter of 2023, noninterest expense of $10.5 million was slightly higher than both the prior year and linked quarters. We encountered some one-time expenses in the quarter related to check fraud, which elevated expense levels above our current run rate.
Mr. Klein stated, “As revenue levels have declined, we have been focused on reducing resources and controllable expenses throughout the Company. Our total headcount is down over 7 percent and expenses have declined 1.4 percent for the nine months compared to the prior nine month period.”
| Noninterest Income/Noninterest Expense | Annual | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Sep. 2023 | Jun. 2023 | Mar. 2023 | Dec. 2022 | Sep. 2022 | Growth | ||||||||||||||||||
| Noninterest Income (NII) | $ | 4,163 | $ | 4,361 | $ | 3,666 | $ | 3,713 | $ | 4,043 | $ | 120 | ||||||||||||
| NII / Total Revenue | 30.4 | % | 30.7 | % | 26.2 | % | 25.4 | % | 27.9 | % | 2.5 | % | ||||||||||||
| NII / Average Assets | 1.2 | % | 1.3 | % | 1.1 | % | 1.1 | % | 1.2 | % | 0.0 | % | ||||||||||||
| Total Revenue Growth | -5.3 | % | -0.5 | % | -2.0 | % | -6.7 | % | -13.2 | % | -5.3 | % | ||||||||||||
| Noninterest Expense (NIE) | $ | 10,481 | $ | 10,339 | $ | 10,773 | $ | 10,269 | $ | 10,384 | $ | 97 | ||||||||||||
| Efficiency Ratio | 76.4 | % | 72.7 | % | 76.9 | % | 70.2 | % | 71.6 | % | 4.8 | % | ||||||||||||
| NIE / Average Assets | 3.1 | % | 3.1 | % | 3.2 | % | 3.1 | % | 3.2 | % | -0.1 | % | ||||||||||||
| Net Noninterest Expense/Avg. Assets | -1.9 | % | -1.8 | % | -2.1 | % | -2.0 | % | -2.0 | % | 0.1 | % | ||||||||||||
| Total Expense Growth | 0.9 | % | -4.3 | % | -0.8 | % | -11.2 | % | -7.7 | % | 0.9 | % | ||||||||||||
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Balance Sheet
As of September 30, 2023, total assets were $1.33 billion, a slight decrease from the linked quarter, and 1.8 percent higher compared to the prior year. Total shareholders’ equity at September 30, 2023, was $112.3 million. Excluding the impact of the investment portfolio net unrealized losses, equity rose to $151.9 million, reflecting a 2.6 percent increase. During the quarter, we repurchased 43,814 shares of our Company stock and we have declared cash dividends of $0.39 per share for the nine-month period, an 8.5 percent increase from the prior period. The investment portfolio of $212.8 million was down $30.5 million or 12.5 percent from a year ago and now constitutes 16.0 percent of total assets.
Total loans held for investment were up $63.8 million or 6.9 percent compared to the prior year. The Allowance for Credit Losses ended the quarter at $15.8 million or 1.60 percent of total loans. The reserve is higher by $2.0 million, or 14.2 percent compared to the prior year due to CECL and negligible charge-offs in the current year. Deposit balances of $1.09 billion at September 30, 2023, were level to the prior year, but were higher compared to the linked quarter by $14.2 million.
Mr. Klein continued, “Loan balances were higher compared to the linked quarter, and we have now grown loans quarter over quarter for seven consecutive quarters. Our commercial pipelines of $44 million remain under pressure in most of our markets, but we continue to aggressively call to expand relationships from both internal and external clients. Asset quality continues to remain stable, and our coverage of non-performing loans has increased to nearly five times at quarter end.”
| Loan Balances | Annual | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Sep. 2023 | Jun. 2023 | Mar. 2023 | Dec. 2022 | Sep. 2022 | Growth | ||||||||||||||||||
| Commercial | $ | 120,325 | $ | 123,226 | $ | 126,066 | $ | 128,393 | $ | 128,565 | $ | (8,240 | ) | |||||||||||
| % of Total | 12.2 | % | 12.5 | % | 12.9 | % | 13.3 | % | 13.9 | % | -6.4 | % | ||||||||||||
| Commercial RE | 421,736 | 417,412 | 419,024 | 412,809 | 404,710 | 17,026 | ||||||||||||||||||
| % of Total | 42.6 | % | 42.4 | % | 42.9 | % | 42.9 | % | 43.7 | % | 4.2 | % | ||||||||||||
| Agriculture | 60,928 | 58,222 | 57,761 | 64,505 | 60,522 | 406 | ||||||||||||||||||
| % of Total | 6.2 | % | 5.9 | % | 5.9 | % | 6.7 | % | 6.5 | % | 0.7 | % | ||||||||||||
| Residential RE | 320,306 | 321,365 | 309,684 | 291,368 | 267,135 | 53,171 | ||||||||||||||||||
| % of Total | 32.4 | % | 32.6 | % | 31.7 | % | 30.3 | % | 28.9 | % | 19.9 | % | ||||||||||||
| Consumer & Other | 65,726 | 64,599 | 63,777 | 65,000 | 64,317 | 1,409 | ||||||||||||||||||
| % of Total | 6.6 | % | 6.6 | % | 6.5 | % | 6.8 | % | 7.0 | % | 2.2 | % | ||||||||||||
| Total Loans | $ | 989,021 | $ | 984,824 | $ | 976,312 | $ | 962,075 | $ | 925,249 | $ | 63,772 | ||||||||||||
| Total Growth Percentage | 6.9 | % | ||||||||||||||||||||||
| Deposit Balances | Annual | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Sep. 2023 | Jun. 2023 | Mar. 2023 | Dec. 2022 | Sep. 2022 | Growth | ||||||||||||||||||
| Non-Int DDA | $ | 224,182 | $ | 218,411 | $ | 237,175 | $ | 256,799 | $ | 250,791 | $ | (26,609 | ) | |||||||||||
| % of Total | 20.7 | % | 20.4 | % | 21.4 | % | 23.6 | % | 23.1 | % | -10.6 | % | ||||||||||||
| Interest DDA | 174,729 | 170,282 | 188,497 | 191,719 | 199,523 | (24,794 | ) | |||||||||||||||||
| % of Total | 16.1 | % | 15.9 | % | 17.0 | % | 17.6 | % | 18.4 | % | -12.4 | % | ||||||||||||
| Savings | 226,077 | 225,065 | 227,974 | 191,272 | 201,402 | 24,675 | ||||||||||||||||||
| % of Total | 20.8 | % | 21.0 | % | 20.5 | % | 17.6 | % | 18.5 | % | 12.3 | % | ||||||||||||
| Money Market | 216,565 | 217,681 | 222,203 | 255,995 | 258,975 | (42,410 | ) | |||||||||||||||||
| % of Total | 20.0 | % | 20.3 | % | 20.0 | % | 23.6 | % | 23.8 | % | -16.4 | % | ||||||||||||
| Time Deposits | 243,766 | 239,717 | 234,295 | 190,880 | 175,202 | 68,564 | ||||||||||||||||||
| % of Total | 22.5 | % | 22.4 | % | 21.1 | % | 17.6 | % | 16.1 | % | 39.1 | % | ||||||||||||
| Total Deposits | $ | 1,085,319 | $ | 1,071,156 | $ | 1,110,144 | $ | 1,086,665 | $ | 1,085,893 | $ | (574 | ) | |||||||||||
| Total Growth Percentage | -0.1 | % | ||||||||||||||||||||||
4
Asset Quality
SB Financial reported nonperforming assets totaling $4.0 million as of September 30, 2023, marking a decrease of $0.5 million or 12.1 percent from the same quarter last year, despite a slight increase from the linked quarter. The coverage ratio for problem loans, has notably strengthened, improving nearly 100 basis points from the previous year. The enhancement is attributed to both the expansion of the allowance, following a CECL adjustment of $1.4 million, and a concurrent reduction in problem loans.
| Nonperforming Assets | Annual | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Sep. 2023 | Jun. 2023 | Mar. 2023 | Dec. 2022 | Sep. 2022 | Change | ||||||||||||||||||
| Commercial & Agriculture | $ | 717 | $ | 170 | $ | 185 | $ | 114 | $ | 114 | $ | 603 | ||||||||||||
| % of Total Com./Ag. loans | 0.40 | % | 0.09 | % | 0.10 | % | 0.06 | % | 0.06 | % | 528.9 | % | ||||||||||||
| Commercial RE | 222 | 192 | 199 | 210 | 223 | (1 | ) | |||||||||||||||||
| % of Total CRE loans | 0.05 | % | 0.05 | % | 0.05 | % | 0.05 | % | 0.06 | % | -0.4 | % | ||||||||||||
| Residential RE | 2,182 | 2,266 | 2,742 | 3,020 | 3,129 | (947 | ) | |||||||||||||||||
| % of Total Res. RE loans | 0.68 | % | 0.71 | % | 0.89 | % | 1.04 | % | 1.17 | % | -30.3 | % | ||||||||||||
| Consumer & Other | 208 | 282 | 270 | 338 | 280 | (72 | ) | |||||||||||||||||
| % of Total Con./Oth. loans | 0.32 | % | 0.44 | % | 0.42 | % | 0.52 | % | 0.44 | % | -25.7 | % | ||||||||||||
| Total Nonaccruing Loans | 3,329 | 2,910 | 3,396 | 3,682 | 3,746 | (417 | ) | |||||||||||||||||
| % of Total loans | 0.34 | % | 0.30 | % | 0.35 | % | 0.38 | % | 0.40 | % | -11.1 | % | ||||||||||||
| Foreclosed Assets and Other Assets | 629 | 625 | 650 | 777 | 756 | (127 | ) | |||||||||||||||||
| Total Change (%) | -16.8 | % | ||||||||||||||||||||||
| Total Nonperforming Assets | $ | 3,958 | $ | 3,535 | $ | 4,046 | $ | 4,459 | $ | 4,502 | $ | (544 | ) | |||||||||||
| % of Total assets | 0.30 | % | 0.26 | % | 0.30 | % | 0.33 | % | 0.35 | % | -12.08 | % | ||||||||||||
Webcast and Conference Call
The Company will hold the third quarter 2023 earnings conference call and webcast on October 31, 2023, at 11:00 a.m. EDT. Interested parties may access the conference call by dialing 1-888-338-9469. The webcast can be accessed at ir.yourstatebank.com. An audio replay of the call will be available on the Company’s website.
About SB Financial Group
Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title). State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 23 offices: 22 in nine Ohio counties and one in Fort Wayne, Indiana, and 23 ATMs. State Bank has six loan production offices located throughout the Tri-State region of Ohio, Indiana and Michigan. Peak Title provides title insurance and title opinions throughout the Tri-State region. SB Financial’s common stock is listed on the NASDAQ Capital Market with the ticker symbol “SBFG”.
In May 2023, SB Financial was valued #163 on the American Banker Magazine’s list of top 200 publicly traded Community Bank and Thrifts based on three-year average return on equity.
5
Forward-Looking Statements
Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial’s Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Non-GAAP financial measures, specifically pre-tax, pre-provision income, tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common equity, total interest income – FTE, net interest income – FTE and net interest margin – FTE are used by the Company’s management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. In addition, the Company excludes the OMSR impairment from both net income and non-interest income to report non-GAAP adjusted levels. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Investor Contact Information:
Mark A. Klein
Chairman, President and
Chief Executive Officer
Anthony V. Cosentino
Executive Vice President and
Chief Financial Officer
6
SB FINANCIAL GROUP, INC.
CONSOLIDATED BALANCE SHEETS - (Unaudited)
| September | June | March | December | September | ||||||||||||||||
| ($ in thousands) | 2023 | 2023 | 2023 | 2022 | 2022 | |||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and due from banks | $ | 19,049 | $ | 20,993 | $ | 21,625 | $ | 27,817 | $ | 27,934 | ||||||||||
| Interest bearing time deposits | 1,180 | 1,180 | 1,380 | 2,131 | 2,134 | |||||||||||||||
| Available-for-sale securities | 212,768 | 227,996 | 237,607 | 238,780 | 243,233 | |||||||||||||||
| Loans held for sale | 3,206 | 5,684 | 5,592 | 2,073 | 2,979 | |||||||||||||||
| Loans, net of unearned income | 989,021 | 984,824 | 976,312 | 962,075 | 925,249 | |||||||||||||||
| Allowance for credit losses | (15,790 | ) | (15,795 | ) | (15,442 | ) | (13,818 | ) | (13,824 | ) | ||||||||||
| Premises and equipment, net | 21,934 | 22,230 | 22,621 | 22,829 | 22,842 | |||||||||||||||
| Federal Reserve and FHLB Stock, at cost | 6,261 | 7,634 | 6,054 | 6,326 | 5,230 | |||||||||||||||
| Foreclosed assets and other assets | 629 | 625 | 650 | 777 | 756 | |||||||||||||||
| Interest receivable | 4,457 | 4,079 | 3,926 | 4,091 | 3,556 | |||||||||||||||
| Goodwill | 23,239 | 23,239 | 23,239 | 23,239 | 23,239 | |||||||||||||||
| Cash value of life insurance | 29,291 | 29,183 | 29,024 | 28,870 | 28,713 | |||||||||||||||
| Mortgage servicing rights | 13,893 | 13,723 | 13,548 | 13,503 | 13,473 | |||||||||||||||
| Other assets | 17,336 | 15,840 | 15,157 | 16,940 | 17,863 | |||||||||||||||
| Total assets | $ | 1,326,474 | $ | 1,341,435 | $ | 1,341,293 | $ | 1,335,633 | $ | 1,303,377 | ||||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||
| Deposits | ||||||||||||||||||||
| Non interest bearing demand | $ | 224,182 | $ | 218,411 | $ | 237,175 | $ | 256,799 | $ | 250,791 | ||||||||||
| Interest bearing demand | 174,729 | 170,282 | 188,497 | 191,719 | 199,523 | |||||||||||||||
| Savings | 226,077 | 225,065 | 227,974 | 191,272 | 201,402 | |||||||||||||||
| Money market | 216,565 | 217,681 | 222,203 | 255,995 | 258,975 | |||||||||||||||
| Time deposits | 243,766 | 239,717 | 234,295 | 190,880 | 175,202 | |||||||||||||||
| Total deposits | 1,085,319 | 1,071,156 | 1,110,144 | 1,086,665 | 1,085,893 | |||||||||||||||
| Short-term borrowings | 16,519 | 21,118 | 15,998 | 14,923 | 19,754 | |||||||||||||||
| Federal Home Loan Bank advances | 59,500 | 81,300 | 44,500 | 60,000 | 35,000 | |||||||||||||||
| Trust preferred securities | 10,310 | 10,310 | 10,310 | 10,310 | 10,310 | |||||||||||||||
| Subordinated debt net of issuance costs | 19,630 | 19,618 | 19,606 | 19,594 | 19,582 | |||||||||||||||
| Interest payable | 2,216 | 1,866 | 1,441 | 769 | 623 | |||||||||||||||
| Other liabilities | 20,632 | 18,401 | 19,535 | 24,944 | 17,587 | |||||||||||||||
| Total liabilities | 1,214,126 | 1,223,769 | 1,221,534 | 1,217,205 | 1,188,749 | |||||||||||||||
| Shareholders’ Equity | ||||||||||||||||||||
| Common stock | 61,319 | 61,319 | 61,319 | 61,319 | 61,319 | |||||||||||||||
| Additional paid-in capital | 15,037 | 15,154 | 14,953 | 15,087 | 15,000 | |||||||||||||||
| Retained earnings | 105,521 | 103,725 | 101,548 | 101,966 | 99,309 | |||||||||||||||
| Accumulated other comprehensive loss | (39,517 | ) | (32,894 | ) | (29,671 | ) | (32,120 | ) | (33,426 | ) | ||||||||||
| Treasury stock | (30,012 | ) | (29,638 | ) | (28,390 | ) | (27,824 | ) | (27,574 | ) | ||||||||||
| Total shareholders’ equity | 112,348 | 117,666 | 119,759 | 118,428 | 114,628 | |||||||||||||||
| Total liabilities and shareholders’ equity | $ | 1,326,474 | $ | 1,341,435 | $ | 1,341,293 | $ | 1,335,633 | $ | 1,303,377 | ||||||||||
7
SB FINANCIAL GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME - (Unaudited)
| ($ in thousands, except per share & ratios) | At and for the Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
| September | June | March | December | September | September | September | ||||||||||||||||||||||
| 2023 | 2023 | 2023 | 2022 | 2022 | 2023 | 2022 | ||||||||||||||||||||||
| Interest income | ||||||||||||||||||||||||||||
| Loans | ||||||||||||||||||||||||||||
| Taxable | $ | 13,128 | $ | 12,715 | $ | 12,126 | $ | 11,222 | $ | 10,084 | $ | 37,969 | $ | 27,016 | ||||||||||||||
| Tax exempt | 122 | 121 | 116 | 109 | 92 | 359 | 226 | |||||||||||||||||||||
| Securities | ||||||||||||||||||||||||||||
| Taxable | 1,507 | 1,524 | 1,535 | 1,559 | 1,536 | 4,566 | 4,239 | |||||||||||||||||||||
| Tax exempt | 39 | 46 | 47 | 47 | 52 | 132 | 151 | |||||||||||||||||||||
| Total interest income | 14,796 | 14,406 | 13,824 | 12,937 | 11,764 | 43,026 | 31,632 | |||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||||
| Deposits | 4,194 | 3,538 | 2,578 | 1,440 | 852 | 10,310 | 2,037 | |||||||||||||||||||||
| Repurchase agreements & other | 16 | 9 | 10 | 7 | 8 | 35 | 32 | |||||||||||||||||||||
| Federal Home Loan Bank advances | 666 | 664 | 553 | 258 | 180 | 1,883 | 257 | |||||||||||||||||||||
| Trust preferred securities | 189 | 172 | 164 | 138 | 99 | 525 | 223 | |||||||||||||||||||||
| Subordinated debt | 195 | 194 | 195 | 194 | 195 | 584 | 584 | |||||||||||||||||||||
| Total interest expense | 5,260 | 4,577 | 3,500 | 2,037 | 1,334 | 13,337 | 3,133 | |||||||||||||||||||||
| Net interest income | 9,536 | 9,829 | 10,324 | 10,900 | 10,430 | 29,689 | 28,499 | |||||||||||||||||||||
| Provision for credit losses | (6 | ) | 145 | 250 | - | - | 389 | - | ||||||||||||||||||||
| Net interest income after provision for loan losses | 9,542 | 9,684 | 10,074 | 10,900 | 10,430 | 29,300 | 28,499 | |||||||||||||||||||||
| Noninterest income | ||||||||||||||||||||||||||||
| Wealth management fees | 837 | 940 | 917 | 907 | 930 | 2,694 | 2,821 | |||||||||||||||||||||
| Customer service fees | 863 | 871 | 825 | 880 | 844 | 2,559 | 2,498 | |||||||||||||||||||||
| Gain on sale of mtg. loans & OMSR | 1,207 | 1,056 | 599 | 550 | 876 | 2,862 | 3,748 | |||||||||||||||||||||
| Mortgage loan servicing fees, net | 438 | 494 | 608 | 627 | 527 | 1,540 | 2,337 | |||||||||||||||||||||
| Gain on sale of non-mortgage loans | 10 | 218 | 24 | 105 | 125 | 252 | 461 | |||||||||||||||||||||
| Title insurance revenue | 429 | 455 | 373 | 454 | 476 | 1,257 | 1,775 | |||||||||||||||||||||
| Gain (loss) on sale of assets | - | 15 | (11 | ) | 18 | (12 | ) | 4 | 43 | |||||||||||||||||||
| Other | 379 | 312 | 331 | 172 | 277 | 1,022 | 835 | |||||||||||||||||||||
| Total noninterest income | 4,163 | 4,361 | 3,666 | 3,713 | 4,043 | 12,190 | 14,518 | |||||||||||||||||||||
| Noninterest expense | ||||||||||||||||||||||||||||
| Salaries and employee benefits | 5,491 | 5,721 | 5,913 | 5,677 | 5,858 | 17,125 | 18,465 | |||||||||||||||||||||
| Net occupancy expense | 764 | 802 | 784 | 763 | 769 | 2,350 | 2,230 | |||||||||||||||||||||
| Equipment expense | 1,068 | 1,002 | 981 | 1,017 | 918 | 3,051 | 2,599 | |||||||||||||||||||||
| Data processing fees | 648 | 685 | 646 | 627 | 664 | 1,979 | 1,883 | |||||||||||||||||||||
| Professional fees | 623 | 612 | 863 | 738 | 766 | 2,098 | 2,476 | |||||||||||||||||||||
| Marketing expense | 189 | 213 | 198 | 258 | 200 | 600 | 653 | |||||||||||||||||||||
| Telephone and communication expense | 124 | 124 | 121 | 124 | 134 | 369 | 350 | |||||||||||||||||||||
| Postage and delivery expense | 100 | 78 | 87 | 121 | 75 | 265 | 301 | |||||||||||||||||||||
| State, local and other taxes | 218 | 218 | 228 | 277 | 250 | 664 | 805 | |||||||||||||||||||||
| Employee expense | 141 | 156 | 188 | 157 | 145 | 485 | 456 | |||||||||||||||||||||
| Other expenses | 1,115 | 728 | 764 | 510 | 605 | 2,607 | 1,828 | |||||||||||||||||||||
| Total noninterest expense | 10,481 | 10,339 | 10,773 | 10,269 | 10,384 | 31,593 | 32,046 | |||||||||||||||||||||
| Income before income tax expense | 3,224 | 3,706 | 2,967 | 4,344 | 4,089 | 9,897 | 10,971 | |||||||||||||||||||||
| Income tax expense | 537 | 631 | 517 | 811 | 746 | 1,685 | 1,983 | |||||||||||||||||||||
| Net income | $ | 2,687 | $ | 3,075 | $ | 2,450 | $ | 3,533 | $ | 3,343 | $ | 8,212 | $ | 8,988 | ||||||||||||||
| Common share data: | ||||||||||||||||||||||||||||
| Basic earnings per common share | $ | 0.40 | $ | 0.45 | $ | 0.35 | $ | 0.51 | $ | 0.48 | $ | 1.20 | $ | 1.28 | ||||||||||||||
| Diluted earnings per common share | $ | 0.39 | $ | 0.44 | $ | 0.35 | $ | 0.50 | $ | 0.47 | $ | 1.18 | $ | 1.27 | ||||||||||||||
| Average shares outstanding (in thousands): | ||||||||||||||||||||||||||||
| Basic: | 6,791 | 6,847 | 6,933 | 6,945 | 6,968 | 6,857 | 7,026 | |||||||||||||||||||||
| Diluted: | 6,878 | 6,910 | 7,008 | 7,021 | 7,033 | 6,944 | 7,098 | |||||||||||||||||||||
8
SB FINANCIAL GROUP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS - (Unaudited)
| ($ in thousands, except per share & ratios) | At and for the Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
| September | June | March | December | September | September | September | ||||||||||||||||||||||
| SUMMARY OF OPERATIONS | 2023 | 2023 | 2023 | 2022 | 2022 | 2023 | 2022 | |||||||||||||||||||||
| Net interest income | $ | 9,536 | $ | 9,829 | $ | 10,324 | $ | 10,900 | $ | 10,430 | $ | 29,689 | $ | 28,499 | ||||||||||||||
| Tax-equivalent adjustment | 43 | 44 | 43 | 41 | 38 | 131 | 100 | |||||||||||||||||||||
| Tax-equivalent net interest income | 9,579 | 9,873 | 10,367 | 10,941 | 10,468 | 29,820 | 28,599 | |||||||||||||||||||||
| Provision for credit loss | (6 | ) | 145 | 250 | - | - | 389 | - | ||||||||||||||||||||
| Noninterest income | 4,163 | 4,361 | 3,666 | 3,713 | 4,043 | 12,190 | 14,518 | |||||||||||||||||||||
| Total operating revenue | 13,699 | 14,190 | 13,990 | 14,613 | 14,473 | 41,879 | 43,017 | |||||||||||||||||||||
| Noninterest expense | 10,481 | 10,339 | 10,773 | 10,269 | 10,384 | 31,593 | 32,046 | |||||||||||||||||||||
| Pre-tax pre-provision income | 3,218 | 3,851 | 3,217 | 4,344 | 4,088 | 10,286 | 10,971 | |||||||||||||||||||||
| Pretax income | 3,224 | 3,706 | 2,967 | 4,344 | 4,088 | 9,897 | 10,971 | |||||||||||||||||||||
| Net income | 2,687 | 3,075 | 2,450 | 3,533 | 3,343 | 8,212 | 8,988 | |||||||||||||||||||||
| PER SHARE INFORMATION: | ||||||||||||||||||||||||||||
| Basic earnings per share (EPS) | 0.40 | 0.45 | 0.35 | 0.51 | 0.48 | 1.20 | 1.28 | |||||||||||||||||||||
| Diluted earnings per share | 0.39 | 0.44 | 0.35 | 0.50 | 0.47 | 1.18 | 1.27 | |||||||||||||||||||||
| Common dividends | 0.130 | 0.130 | 0.125 | 0.125 | 0.120 | 0.385 | 0.355 | |||||||||||||||||||||
| Book value per common share | 16.59 | 17.30 | 17.37 | 17.08 | 16.49 | 16.59 | 16.49 | |||||||||||||||||||||
| Tangible book value per common share (TBV) | 13.09 | 13.81 | 13.93 | 13.65 | 13.07 | 13.09 | 13.07 | |||||||||||||||||||||
| Market price per common share | 13.50 | 12.62 | 14.13 | 16.95 | 16.85 | 13.50 | 16.85 | |||||||||||||||||||||
| Market price to TBV | 103.1 | % | 91.4 | % | 101.4 | % | 124.2 | % | 128.9 | % | 103.1 | % | 128.9 | % | ||||||||||||||
| Market price to trailing 12 month EPS | 8.0 | 7.1 | 8.2 | 9.6 | 9.6 | 8.0 | 9.6 | |||||||||||||||||||||
| PERFORMANCE RATIOS: | ||||||||||||||||||||||||||||
| Return on average assets (ROAA) | 0.80 | % | 0.91 | % | 0.73 | % | 1.08 | % | 1.03 | % | 0.81 | % | 0.91 | % | ||||||||||||||
| Pre-tax pre-provision ROAA | 0.96 | % | 1.14 | % | 0.96 | % | 1.32 | % | 1.26 | % | 1.10 | % | 1.19 | % | ||||||||||||||
| Return on average equity | 8.73 | % | 10.01 | % | 8.37 | % | 12.17 | % | 10.89 | % | 8.72 | % | 9.21 | % | ||||||||||||||
| Return on average tangible equity | 10.82 | % | 12.40 | % | 10.50 | % | 15.30 | % | 13.51 | % | 10.75 | % | 11.28 | % | ||||||||||||||
| Efficiency ratio | 76.34 | % | 72.71 | % | 76.85 | % | 70.16 | % | 71.63 | % | 75.28 | % | 74.38 | % | ||||||||||||||
| Earning asset yield | 4.78 | % | 4.61 | % | 4.49 | % | 4.27 | % | 3.89 | % | 4.61 | % | 3.42 | % | ||||||||||||||
| Cost of interest bearing liabilities | 2.18 | % | 1.90 | % | 1.46 | % | 0.90 | % | 0.58 | % | 1.85 | % | 0.45 | % | ||||||||||||||
| Net interest margin | 3.08 | % | 3.15 | % | 3.35 | % | 3.60 | % | 3.45 | % | 3.18 | % | 3.08 | % | ||||||||||||||
| Tax equivalent effect | 0.01 | % | 0.01 | % | 0.02 | % | 0.01 | % | 0.01 | % | 0.02 | % | 0.01 | % | ||||||||||||||
| Net interest margin, tax equivalent | 3.09 | % | 3.16 | % | 3.37 | % | 3.61 | % | 3.46 | % | 3.20 | % | 3.09 | % | ||||||||||||||
| Non interest income/Average assets | 1.24 | % | 1.30 | % | 1.10 | % | 1.13 | % | 1.24 | % | 1.21 | % | 1.47 | % | ||||||||||||||
| Non interest expense/Average assets | 3.13 | % | 3.07 | % | 3.23 | % | 3.13 | % | 3.19 | % | 3.13 | % | 3.24 | % | ||||||||||||||
| Net noninterest expense/Average assets | -1.89 | % | -1.78 | % | -2.13 | % | -2.00 | % | -1.95 | % | -1.92 | % | -1.77 | % | ||||||||||||||
| ASSET QUALITY RATIOS: | ||||||||||||||||||||||||||||
| Gross charge-offs | 12 | 32 | 69 | 7 | 9 | 113 | 27 | |||||||||||||||||||||
| Recoveries | 7 | 10 | 8 | 1 | 32 | 25 | 46 | |||||||||||||||||||||
| Net charge-offs | 5 | 22 | 61 | 6 | (23 | ) | 88 | (19 | ) | |||||||||||||||||||
| Nonperforming loans/Total loans | 0.34 | % | 0.30 | % | 0.35 | % | 0.38 | % | 0.40 | % | 0.34 | % | 0.40 | % | ||||||||||||||
| Nonperforming assets/Loans & OREO | 0.40 | % | 0.36 | % | 0.41 | % | 0.46 | % | 0.49 | % | 0.40 | % | 0.49 | % | ||||||||||||||
| Nonperforming assets/Total assets | 0.30 | % | 0.26 | % | 0.30 | % | 0.33 | % | 0.35 | % | 0.30 | % | 0.35 | % | ||||||||||||||
| Allowance for credit loss/Nonperforming loans | 474.32 | % | 542.78 | % | 454.71 | % | 375.29 | % | 369.03 | % | 474.32 | % | 369.03 | % | ||||||||||||||
| Allowance for credit loss/Total loans | 1.60 | % | 1.60 | % | 1.58 | % | 1.44 | % | 1.49 | % | 1.60 | % | 1.49 | % | ||||||||||||||
| Net loan charge-offs/Average loans (ann.) | 0.00 | % | 0.01 | % | 0.03 | % | 0.00 | % | (0.01 | %) | 0.01 | % | (0.00 | %) | ||||||||||||||
| CAPITAL & LIQUIDITY RATIOS: | ||||||||||||||||||||||||||||
| Loans/ Deposits | 91.13 | % | 91.94 | % | 87.94 | % | 88.53 | % | 85.21 | % | 91.13 | % | 85.21 | % | ||||||||||||||
| Equity/ Assets | 8.47 | % | 8.77 | % | 8.93 | % | 8.87 | % | 8.79 | % | 8.47 | % | 8.79 | % | ||||||||||||||
| Tangible equity/Tangible assets | 6.81 | % | 7.13 | % | 7.29 | % | 7.22 | % | 7.10 | % | 6.81 | % | 7.10 | % | ||||||||||||||
| Common equity tier 1 ratio (Bank) | 13.56 | % | 13.18 | % | 13.44 | % | 13.42 | % | 13.23 | % | 13.56 | % | 13.23 | % | ||||||||||||||
| END OF PERIOD BALANCES | ||||||||||||||||||||||||||||
| Total assets | 1,326,474 | 1,341,435 | 1,341,293 | 1,335,633 | 1,303,377 | 1,326,474 | 1,303,377 | |||||||||||||||||||||
| Total loans | 989,021 | 984,824 | 976,312 | 962,075 | 925,249 | 989,021 | 925,249 | |||||||||||||||||||||
| Deposits | 1,085,319 | 1,071,156 | 1,110,144 | 1,086,665 | 1,085,893 | 1,085,319 | 1,085,893 | |||||||||||||||||||||
| Stockholders equity | 112,348 | 117,666 | 119,759 | 118,428 | 114,628 | 112,348 | 114,628 | |||||||||||||||||||||
| Goodwill and intangibles | 23,687 | 23,710 | 23,732 | 23,753 | 23,770 | 23,687 | 23,770 | |||||||||||||||||||||
| Tangible equity | 88,661 | 93,956 | 96,027 | 94,675 | 90,858 | 88,661 | 90,858 | |||||||||||||||||||||
| Mortgage servicing portfolio | 1,367,209 | 1,353,904 | 1,344,158 | 1,352,016 | 1,362,666 | 1,367,209 | 1,362,666 | |||||||||||||||||||||
| Wealth/Brokerage assets under care | 478,236 | 499,255 | 518,009 | 507,093 | 480,947 | 478,236 | 480,947 | |||||||||||||||||||||
| Total assets under care | 3,171,919 | 3,194,594 | 3,203,460 | 3,194,742 | 3,146,990 | 3,171,919 | 3,146,990 | |||||||||||||||||||||
| Full-time equivalent employees | 252 | 253 | 255 | 268 | 271 | 252 | 271 | |||||||||||||||||||||
| Period end common shares outstanding | 6,773 | 6,803 | 6,894 | 6,935 | 6,950 | 6,773 | 6,950 | |||||||||||||||||||||
| Market capitalization (all) | 91,437 | 85,857 | 97,419 | 117,556 | 117,113 | 91,437 | 117,113 | |||||||||||||||||||||
| AVERAGE BALANCES | ||||||||||||||||||||||||||||
| Total assets | 1,339,870 | 1,346,010 | 1,335,056 | 1,314,419 | 1,302,297 | 1,344,467 | 1,319,668 | |||||||||||||||||||||
| Total earning assets | 1,239,145 | 1,248,813 | 1,232,018 | 1,211,674 | 1,209,958 | 1,243,094 | 1,231,865 | |||||||||||||||||||||
| Total loans | 989,089 | 988,348 | 970,813 | 937,898 | 909,909 | 982,817 | 871,340 | |||||||||||||||||||||
| Deposits | 1,095,414 | 1,100,344 | 1,098,935 | 1,094,491 | 1,085,821 | 1,098,593 | 1,109,345 | |||||||||||||||||||||
| Stockholders equity | 123,070 | 122,886 | 117,071 | 116,114 | 122,738 | 125,580 | 130,069 | |||||||||||||||||||||
| Goodwill and intangibles | 23,698 | 23,721 | 23,743 | 23,761 | 23,778 | 23,720 | 23,791 | |||||||||||||||||||||
| Tangible equity | 99,372 | 99,165 | 93,328 | 92,353 | 98,960 | 101,860 | 106,278 | |||||||||||||||||||||
| Average basic shares outstanding | 6,791 | 6,847 | 6,933 | 6,945 | 6,968 | 6,857 | 7,026 | |||||||||||||||||||||
| Average diluted shares outstanding | 6,878 | 6,910 | 7,008 | 7,021 | 7,033 | 6,944 | 7,098 | |||||||||||||||||||||
9
SB FINANCIAL GROUP, INC.
Rate Volume Analysis - (Unaudited)
For the Three Months Ended Sep. 30, 2023 and 2022
| ($ in thousands) | Three Months Ended Sep. 30, 2023 | Three Months Ended Sep. 30, 2022 | ||||||||||||||||||||||
| Average | Average | Average | Average | |||||||||||||||||||||
| Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||||||||||
| Assets | ||||||||||||||||||||||||
| Taxable securities/cash | $ | 243,261 | $ | 1,507 | 2.48 | % | $ | 291,712 | $ | 1,536 | 2.11 | % | ||||||||||||
| Nontaxable securities | 6,795 | 39 | 2.30 | % | 8,337 | 52 | 2.49 | % | ||||||||||||||||
| Loans, net | 989,089 | 13,250 | 5.36 | % | 909,909 | 10,176 | 4.47 | % | ||||||||||||||||
| Total earning assets | 1,239,145 | 14,796 | 4.78 | % | 1,209,958 | 11,764 | 3.89 | % | ||||||||||||||||
| Cash and due from banks | 4,022 | 6,782 | ||||||||||||||||||||||
| Allowance for loan losses | (15,791 | ) | (13,802 | ) | ||||||||||||||||||||
| Premises and equipment | 22,120 | 23,762 | ||||||||||||||||||||||
| Other assets | 90,374 | 75,597 | ||||||||||||||||||||||
| Total assets | $ | 1,339,870 | $ | 1,302,297 | ||||||||||||||||||||
| Liabilities | ||||||||||||||||||||||||
| Savings, MMDA and interest bearing demand | $ | 620,092 | $ | 2,232 | 1.44 | % | $ | 681,209 | $ | 542 | 0.32 | % | ||||||||||||
| Time deposits | 244,289 | 1,962 | 3.21 | % | 155,979 | 310 | 0.79 | % | ||||||||||||||||
| Repurchase agreements & other | 16,319 | 16 | 0.39 | % | 20,160 | 8 | 0.16 | % | ||||||||||||||||
| Advances from Federal Home Loan Bank | 55,073 | 666 | 4.84 | % | 26,739 | 180 | 2.69 | % | ||||||||||||||||
| Trust preferred securities | 10,310 | 189 | 7.33 | % | 10,310 | 99 | 3.84 | % | ||||||||||||||||
| Subordinated debt | 19,622 | 195 | 3.98 | % | 19,576 | 195 | 3.98 | % | ||||||||||||||||
| Total interest bearing liabilities | 965,705 | 5,260 | 2.18 | % | 913,973 | 1,334 | 0.58 | % | ||||||||||||||||
| Non interest bearing demand | 231,033 | - | 248,633 | - | ||||||||||||||||||||
| Total funding | 1,196,738 | 1.76 | % | 1,162,606 | 0.46 | % | ||||||||||||||||||
| Other liabilities | 20,062 | 16,952 | ||||||||||||||||||||||
| Total liabilities | 1,216,800 | 1,179,558 | ||||||||||||||||||||||
| Equity | 123,070 | 122,738 | ||||||||||||||||||||||
| Total liabilities and equity | $ | 1,339,870 | $ | 1,302,296 | ||||||||||||||||||||
| Net interest income | $ | 9,536 | $ | 10,430 | ||||||||||||||||||||
| Net interest income as a percent of average interest-earning assets - GAAP measure | 3.08 | % | 3.45 | % | ||||||||||||||||||||
| Net interest income as a percent of average interest-earning assets - non GAAP | 3.09 | % | 3.46 | % | ||||||||||||||||||||
| - Computed on a fully tax equivalent (FTE) basis | ||||||||||||||||||||||||
10
| Nine Months Ended Sep. 30, 2023 | Nine Months Ended Sep. 30, 2022 | |||||||||||||||||||||||
| Average | Average | Average | Average | |||||||||||||||||||||
| Balance | Interest | Rate | Balance | Interest | Rate | |||||||||||||||||||
| Assets | ||||||||||||||||||||||||
| Taxable securities/cash | $ | 252,908 | $ | 4,566 | 2.41 | % | $ | 352,405 | $ | 4,239 | 1.60 | % | ||||||||||||
| Nontaxable securities | 7,369 | 132 | 2.39 | % | 8,120 | 151 | 2.48 | % | ||||||||||||||||
| Loans, net | 982,817 | 38,328 | 5.20 | % | 871,340 | 27,242 | 4.17 | % | ||||||||||||||||
| Total earning assets | 1,243,094 | 43,026 | 4.61 | % | 1,231,865 | 31,632 | 3.42 | % | ||||||||||||||||
| Cash and due from banks | 4,020 | 7,331 | ||||||||||||||||||||||
| Allowance for loan losses | (15,374 | ) | (13,804 | ) | ||||||||||||||||||||
| Premises and equipment | 22,500 | 24,265 | ||||||||||||||||||||||
| Other assets | 90,227 | 70,011 | ||||||||||||||||||||||
| Total assets | $ | 1,344,467 | $ | 1,319,668 | ||||||||||||||||||||
| Liabilities | ||||||||||||||||||||||||
| Savings, MMDA and interest bearing demand | $ | 627,074 | $ | 5,367 | 1.14 | % | $ | 709,033 | $ | 1,293 | 0.24 | % | ||||||||||||
| Time deposits | 233,054 | 4,943 | 2.83 | % | 152,230 | 744 | 0.65 | % | ||||||||||||||||
| Repurchase agreements & Other | 16,576 | 35 | 0.28 | % | 21,298 | 32 | 0.20 | % | ||||||||||||||||
| Advances from Federal Home Loan Bank | 53,936 | 1,883 | 4.65 | % | 12,154 | 257 | 2.82 | % | ||||||||||||||||
| Trust preferred securities | 10,310 | 525 | 6.79 | % | 10,310 | 223 | 2.88 | % | ||||||||||||||||
| Subordinated debt | 19,610 | 584 | 3.97 | % | 19,564 | 584 | 3.98 | % | ||||||||||||||||
| Total interest bearing liabilities | 960,560 | 13,337 | 1.85 | % | 924,589 | 3,132 | 0.45 | % | ||||||||||||||||
| Non interest bearing demand | 238,465 | 1.48 | % | 248,082 | 0.36 | % | ||||||||||||||||||
| Total funding | 1,199,025 | 1,172,671 | ||||||||||||||||||||||
| Other liabilities | 19,862 | 16,928 | ||||||||||||||||||||||
| Total liabilities | 1,218,887 | 1,189,599 | ||||||||||||||||||||||
| Equity | 125,580 | 130,069 | ||||||||||||||||||||||
| Total liabilities and equity | $ | 1,344,467 | $ | 1,319,668 | ||||||||||||||||||||
| Net interest income | $ | 29,689 | $ | 28,500 | ||||||||||||||||||||
| Net interest income as a percent of average interest-earning assets - GAAP measure | 3.18 | % | 3.08 | % | ||||||||||||||||||||
| Net interest income as a percent of average interest-earning assets - non GAAP | 3.20 | % | 3.09 | % | ||||||||||||||||||||
| - Computed on a fully tax equivalent (FTE) basis | ||||||||||||||||||||||||
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| Non-GAAP reconciliation | Three Months Ended | Nine Months Ended | ||||||||||||||
| ($ in thousands, except per share & ratios) | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | ||||||||||||
| Total Operating Revenue | $ | 13,699 | $ | 14,473 | $ | 41,879 | $ | 43,017 | ||||||||
| Adjustment to (deduct)/add OMSR recapture/impairment * | 78 | (65 | ) | 39 | (1,193 | ) | ||||||||||
| Adjusted Total Operating Revenue | 13,777 | 14,408 | 41,918 | 41,824 | ||||||||||||
| Income before Income Taxes | 3,224 | 4,088 | 9,897 | 10,971 | ||||||||||||
| Adjustment for OMSR * | 78 | (65 | ) | 39 | (1,193 | ) | ||||||||||
| Adjusted Income before Income Taxes | 3,302 | 4,023 | 9,936 | 9,778 | ||||||||||||
| Provision for Income Taxes | 537 | 746 | 1,685 | 1,983 | ||||||||||||
| Adjustment for OMSR ** | 16 | (14 | ) | 8 | (251 | ) | ||||||||||
| Adjusted Provision for Income Taxes | 553 | 732 | 1,693 | 1,733 | ||||||||||||
| Net Income | 2,687 | 3,342 | 8,212 | 8,988 | ||||||||||||
| Adjustment for OMSR * | 62 | (51 | ) | 31 | (942 | ) | ||||||||||
| Adjusted Net Income | 2,749 | 3,291 | 8,243 | 8,046 | ||||||||||||
| Diluted Earnings per Share | 0.39 | 0.47 | 1.18 | 1.27 | ||||||||||||
| Adjustment for OMSR * | 0.01 | (0.00 | ) | 0.00 | (0.13 | ) | ||||||||||
| Adjusted Diluted Earnings per Share | $ | 0.40 | $ | 0.47 | $ | 1.19 | $ | 1.13 | ||||||||
| Return on Average Assets | 0.80 | % | 1.03 | % | 0.81 | % | 0.91 | % | ||||||||
| Adjustment for OMSR * | 0.02 | % | -0.02 | % | 0.00 | % | -0.07 | % | ||||||||
| Adjusted Return on Average Assets | 0.82 | % | 1.01 | % | 0.82 | % | 0.84 | % | ||||||||
| * | valuation adjustment to the Company’s mortgage servicing rights |
| ** | tax effect is calculated using a 21% statutory federal corporate income tax rate |
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