County Bancorp, Inc. (the “Company”; Nasdaq: ICBK), the holding
company of Investors Community Bank (the “Bank”), a community bank
headquartered in Manitowoc, Wisconsin, today reported financial
results for the third quarter ended September 30, 2020. Net income
was $3.4 million, or $0.52 per diluted share, for the third quarter
of 2020, compared to net income of $5.7 million, or $0.82 per
diluted share, for the third quarter of 2019. For the nine months
ended September 30, 2020, net income was $1.0 million, or $0.10 per
diluted share, compared to net income of $13.1 million, or $1.89
per share, for the nine months ended September 30, 2019. The net
income for the nine months ended September 30, 2020 included a $5.0
million goodwill impairment charge, or $0.76 loss per diluted share
in the first quarter of 2020. Excluding that charge, net income for
the nine months ended September 30, 2020 would have been $6.0
million, or $0.87 per diluted share.
Tim Schneider, President of County Bancorp,
Inc., noted, “We continue to see generally positive credit trends
across our loan portfolio and we’re highly encouraged by the
momentum of the recovery across our business, as well as across the
businesses and communities that we live in and support. Class III
milk prices (cwt) continued to improve, ranging from $16.43 to
$24.54 during the third quarter of 2020, with fourth quarter
futures contracts trading from $17.53 to $19.53, which we believe
will improve the credit outlook for many of our dairy
borrowers. Loans in payment deferral associated with
our customer pandemic support program declined $100.1 million
during the third quarter. Loans rated watch or worse decreased by
$13.1 million, which resulted in lower loan loss provision this
quarter.”
Schneider continued, “The investments we’ve made
in our agricultural loan offerings are starting to bear fruit,
resulting in an increase in overall loan production activity over
the last few months. We saw stronger activity in loan sales
resulting in increased loan servicing fees and rights during the
third quarter 2020, which contributed to improved noninterest
income this quarter. Lastly, we continue to be highly encouraged by
a strong loan pipeline moving into the fourth quarter 2020, which
should continue to support our momentum.”
Loans and
Securities
- Total loans
decreased $11.6 million, or 1.1%, during the third quarter of 2020,
to $1.1 billion, and decreased $4.8 million, or 0.4%, since
September 30, 2019.
- The decrease was
primarily due to the continued focus on long-term liquidity. Loan
participations the Company continued to service were $797.8 million
at September 30, 2020, an increase of $35.8 million, or 4.7%,
compared to the second quarter of 2020, and an increase of $61.0
million, or 8.3%, compared to September 30, 2019.
- Loans in payment
deferral associated with COVID-19 customer support programs are
$100.3 million, or 9.3% of total loans, at September 30, 2020,
which is a decrease of 100.1, or 50.0%, million since June 30,
2020.
- $4.9 million, or
5.3%, of Paycheck Protection Program (“PPP”) loans provided to our
customers were forgiven by the Small Business Administration
(“SBA”) during the third quarter of 2020 resulting in the Company
having $98.4 million of PPP loans at September 30, 2020. As of
September 30, 2020, $3.3 million of SBA origination fees were
deferred until the associated loan is forgiven.
- During the third
quarter of 2020, investments increased by $71.5 million, or 31.5%.
Purchases totaling $85.3 million were offset in part by $7.7
million in security sales and $5.8 million in maturities. Gain on
the sale of securities was $0.1 million during the third quarter of
2020.
Deposits
- Total deposits at
September 30, 2020 were $1.1 billion, a decrease of $22.9 million,
or 2.1%, from June 30, 2020, and a decrease $92.6 million, or 8.1%,
year-over-year.
- Client deposits
(demand deposits, NOW accounts, savings accounts, money market
accounts, and certificates of deposit) increased $4.1 million, or
0.5%, from June 30, 2020, to $897.6 million, and increased $79.4
million, or 9.7%, year-over-year.
- The Company
decreased its reliance on brokered deposits and national
certificate of deposits by $26.9 million, or 15.0%, to $152.6
million during the third quarter of 2020, and decreased by $172.0
million, or 53.0% since September 30, 2019.
Net Interest Income and
Margin
- Net interest
margin for the quarter ended September 30, 2020 was 2.40%. Net
interest margin decreased 14 basis points quarter-to-quarter, and
decreased 45 basis points year-over-year due primarily to the SBA
PPP loans that were funded during the second quarter of 2020 at
annual yield of 1.0%, as well as the repricing of loans in the
declining rate environment. The issuance of subordinated debt
during 2020 also adversely affected net interest margin by three
basis points year-to-date.
- Interest income on
investment securities increased both quarter-to-quarter and
year-over-year due to shifting balances from interest-bearing
deposits with banks to investment securities with higher
yields.
- Loan interest
income decreased compared to the sequential quarter and
year-over-year periods primarily as a result of the lower yields on
the previously mentioned PPP loans. The year-over-year decrease was
also affected by the shift from loans held on balance sheet to
loans sold and serviced.
- Interest expense
on savings, NOW, money market, and interest checking accounts
decreased, despite the increase in average balance, by nine basis
points in the linked quarter and by 110 basis points year-over year
due to the market-driven drop in the federal funds rate.
- Interest expense
on time deposits decreased quarter-over-quarter due in part to the
Company’s continued focus on shifting away from brokered time
deposit balances for funding. Time deposits decreased
year-over-year, primarily due to the Company’s shift away from
wholesale funding. Rates paid on time deposits decreased by 36
basis points in both the linked quarter and year-over-year, which
also contributed to the overall decrease in cost of funds.
- Interest expense
on subordinated debt increased quarter-over-quarter and
year-over-year due to the $5.1 million of subordinated debt that
was issued during the third quarter of 2020 and the $17.4 million
of subordinated debt issued on June 30, 2020. Such subordinated
debt was issued by the Company to take advantage of attractive
market pricing and strengthen the Company's capital structure.
The table below presents the effects of changing
rates and volumes on net interest income for the periods
indicated.
|
|
Three Months Ended September 30, 2020 v.Three Months Ended June 30,
2020 |
|
|
Three Months Ended September 30, 2020 v.Three Months Ended
September 30, 2019 |
|
|
|
Increase (Decrease)Due to Change in Average |
|
|
Increase (Decrease)Due to Change in Average |
|
|
|
Volume |
|
|
Rate |
|
|
Net |
|
|
Volume |
|
|
Rate |
|
|
Net |
|
|
|
|
|
|
|
(dollars in thousands) |
|
Interest
Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities |
|
$ |
122 |
|
|
$ |
(72 |
) |
|
$ |
50 |
|
|
$ |
527 |
|
|
$ |
(150 |
) |
|
$ |
377 |
|
Loans |
|
|
(146 |
) |
|
|
(391 |
) |
|
|
(537 |
) |
|
|
(544 |
) |
|
|
(2,892 |
) |
|
|
(3,436 |
) |
Federal funds sold and interest-bearing deposits with banks |
|
|
93 |
|
|
|
(186 |
) |
|
|
(93 |
) |
|
|
(61 |
) |
|
|
(533 |
) |
|
|
(594 |
) |
Total interest income |
|
|
69 |
|
|
|
(649 |
) |
|
|
(580 |
) |
|
|
(78 |
) |
|
|
(3,575 |
) |
|
|
(3,653 |
) |
Interest
Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW, money market and interest checking |
|
$ |
40 |
|
|
$ |
(96 |
) |
|
$ |
(56 |
) |
|
$ |
431 |
|
|
$ |
(1,238 |
) |
|
$ |
(807 |
) |
Time deposits |
|
|
(288 |
) |
|
|
(464 |
) |
|
|
(752 |
) |
|
|
(1,256 |
) |
|
|
(598 |
) |
|
|
(1,854 |
) |
Other borrowings |
|
|
12 |
|
|
|
131 |
|
|
|
143 |
|
|
|
150 |
|
|
|
(1 |
) |
|
|
149 |
|
FHLB advances |
|
|
(46 |
) |
|
|
16 |
|
|
|
(30 |
) |
|
|
80 |
|
|
|
(19 |
) |
|
|
61 |
|
Junior subordinated debentures |
|
|
346 |
|
|
|
— |
|
|
|
346 |
|
|
|
347 |
|
|
|
48 |
|
|
|
395 |
|
Total interest expense |
|
$ |
64 |
|
|
$ |
(413 |
) |
|
$ |
(349 |
) |
|
$ |
(248 |
) |
|
$ |
(1,808 |
) |
|
$ |
(2,056 |
) |
Net interest income |
|
$ |
5 |
|
|
$ |
(236 |
) |
|
$ |
(231 |
) |
|
$ |
170 |
|
|
$ |
(1,767 |
) |
|
$ |
(1,597 |
) |
|
The following table sets forth average balances,
average yields and rates, and income and expenses for the period
indicated.
|
|
For the Three Months Ended |
|
|
|
September 30, 2020 |
|
|
June 30, 2020 |
|
|
September 30, 2019 |
|
|
|
AverageBalance (1) |
|
|
Income/Expense |
|
|
Yields/Rates |
|
|
AverageBalance (1) |
|
|
Income/Expense |
|
|
Yields/Rates |
|
|
AverageBalance (1) |
|
|
Income/Expense |
|
|
Yields/Rates |
|
|
|
(dollars in thousands) |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities |
|
$ |
256,059 |
|
|
$ |
1,494 |
|
|
|
2.32 |
% |
|
$ |
237,082 |
|
|
$ |
1,444 |
|
|
|
2.44 |
% |
|
$ |
159,091 |
|
|
$ |
1,117 |
|
|
|
2.81 |
% |
Loans (2) |
|
|
1,083,383 |
|
|
|
11,594 |
|
|
|
4.26 |
% |
|
|
1,098,327 |
|
|
|
12,131 |
|
|
|
4.42 |
% |
|
|
1,126,243 |
|
|
|
15,030 |
|
|
|
5.34 |
% |
Interest bearing deposits due from other banks |
|
|
92,701 |
|
|
|
18 |
|
|
|
0.08 |
% |
|
|
64,142 |
|
|
|
111 |
|
|
|
0.69 |
% |
|
|
104,253 |
|
|
|
612 |
|
|
|
2.35 |
% |
Total interest-earning assets |
|
$ |
1,432,143 |
|
|
$ |
13,106 |
|
|
|
3.64 |
% |
|
$ |
1,399,551 |
|
|
$ |
13,686 |
|
|
|
3.91 |
% |
|
$ |
1,389,587 |
|
|
$ |
16,759 |
|
|
|
4.82 |
% |
Allowance for loan losses |
|
|
(18,641 |
) |
|
|
|
|
|
|
|
|
|
|
(17,844 |
) |
|
|
|
|
|
|
|
|
|
|
(16,209 |
) |
|
|
|
|
|
|
|
|
Other assets |
|
|
86,109 |
|
|
|
|
|
|
|
|
|
|
|
85,716 |
|
|
|
|
|
|
|
|
|
|
|
78,664 |
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
1,499,611 |
|
|
|
|
|
|
|
|
|
|
$ |
1,467,423 |
|
|
|
|
|
|
|
|
|
|
$ |
1,452,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW, money market, interest checking |
|
$ |
406,888 |
|
|
$ |
469 |
|
|
|
0.46 |
% |
|
$ |
379,991 |
|
|
$ |
525 |
|
|
|
0.55 |
% |
|
$ |
326,592 |
|
|
$ |
1,276 |
|
|
|
1.56 |
% |
Time deposits |
|
|
499,665 |
|
|
|
2,444 |
|
|
|
1.95 |
% |
|
|
553,616 |
|
|
|
3,196 |
|
|
|
2.31 |
% |
|
|
745,032 |
|
|
|
4,298 |
|
|
|
2.31 |
% |
Total interest-bearing deposits |
|
$ |
906,553 |
|
|
$ |
2,913 |
|
|
|
1.28 |
% |
|
$ |
933,607 |
|
|
$ |
3,721 |
|
|
|
1.59 |
% |
|
$ |
1,071,624 |
|
|
$ |
5,574 |
|
|
|
2.08 |
% |
Other borrowings |
|
|
101,829 |
|
|
|
158 |
|
|
|
0.62 |
% |
|
|
66,910 |
|
|
|
15 |
|
|
|
0.09 |
% |
|
|
804 |
|
|
|
9 |
|
|
|
4.60 |
% |
FHLB advances |
|
|
89,622 |
|
|
|
298 |
|
|
|
1.32 |
% |
|
|
103,916 |
|
|
|
328 |
|
|
|
1.26 |
% |
|
|
48,857 |
|
|
|
237 |
|
|
|
1.94 |
% |
Junior subordinated debentures |
|
|
65,903 |
|
|
|
1,082 |
|
|
|
6.53 |
% |
|
|
45,090 |
|
|
|
736 |
|
|
|
6.52 |
% |
|
|
44,800 |
|
|
|
687 |
|
|
|
6.14 |
% |
Total interest-bearing liabilities |
|
$ |
1,163,907 |
|
|
$ |
4,451 |
|
|
|
1.52 |
% |
|
$ |
1,149,523 |
|
|
$ |
4,800 |
|
|
|
1.67 |
% |
|
$ |
1,166,085 |
|
|
$ |
6,507 |
|
|
|
2.23 |
% |
Non-interest bearing deposits |
|
|
147,595 |
|
|
|
|
|
|
|
|
|
|
|
134,271 |
|
|
|
|
|
|
|
|
|
|
|
105,578 |
|
|
|
|
|
|
|
|
|
Other liabilities |
|
|
18,314 |
|
|
|
|
|
|
|
|
|
|
|
16,749 |
|
|
|
|
|
|
|
|
|
|
|
14,801 |
|
|
|
|
|
|
|
|
|
Total liabilities |
|
$ |
1,329,816 |
|
|
|
|
|
|
|
|
|
|
$ |
1,300,543 |
|
|
|
|
|
|
|
|
|
|
$ |
1,286,464 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity |
|
|
169,795 |
|
|
|
|
|
|
|
|
|
|
|
166,880 |
|
|
|
|
|
|
|
|
|
|
|
165,578 |
|
|
|
|
|
|
|
|
|
Total liabilities and equity |
|
$ |
1,499,611 |
|
|
|
|
|
|
|
|
|
|
$ |
1,467,423 |
|
|
|
|
|
|
|
|
|
|
$ |
1,452,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
|
|
|
$ |
8,655 |
|
|
|
|
|
|
|
|
|
|
$ |
8,886 |
|
|
|
|
|
|
|
|
|
|
$ |
10,252 |
|
|
|
|
|
Interest rate spread (3) |
|
|
|
|
|
|
|
|
|
|
2.12 |
% |
|
|
|
|
|
|
|
|
|
|
2.24 |
% |
|
|
|
|
|
|
|
|
|
|
2.59 |
% |
Net interest margin (4) |
|
|
|
|
|
|
|
|
|
|
2.40 |
% |
|
|
|
|
|
|
|
|
|
|
2.54 |
% |
|
|
|
|
|
|
|
|
|
|
2.95 |
% |
Ratio of interest-earning
assets to interest-bearing liabilities |
|
|
1.23 |
|
|
|
|
|
|
|
|
|
|
|
1.22 |
|
|
|
|
|
|
|
|
|
|
|
1.19 |
|
|
|
|
|
|
|
|
|
(1) Average balances are calculated on amortized
cost.(2) Includes loan fee income, nonaccruing loan balances, and
interest received on such loans.(3) Interest rate spread represents
the difference between the yield on average interest-earning assets
and the cost of average interest-bearing liabilities.(4) Net
interest margin represents net interest income divided by average
total interest-earning assets.
Non-Interest Income
- Loan servicing
income increased quarter-over-quarter primarily due to a three
basis points increase in loan servicing fees as a percent of
average loans serviced for the third quarter and a $35.8 million
increase total loans serviced. Year-over-year, loan servicing fees
increased due primarily to an 11 basis point increase in loan
servicing fees as a percent of average loans serviced and an
increase in loans serviced.
- Loan
servicing right origination increased both quarter-over-quarter and
decreased year-over-year. The increase in the quarter was primarily
due to an increase in loans sold and serviced. The loan servicing
rights as a percent of loans serviced remained at 2.16% since June
30, 2020. The year-over-year increase from 1.54% at September 30,
2019 is due to loans being recorded at fair value in 2020 versus
amortized cost in 2019.
- $7.7
million of securities were sold during the third quarter of 2020,
which resulted in a $0.1 million gain.
|
|
|
For the Three Months Ended |
|
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands) |
|
|
|
|
|
Non-Interest Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service charges |
|
$ |
379 |
|
|
$ |
368 |
|
|
$ |
342 |
|
|
$ |
549 |
|
|
$ |
348 |
|
Gain on sale of loans, net |
|
|
17 |
|
|
|
4 |
|
|
|
38 |
|
|
|
34 |
|
|
|
87 |
|
Loan servicing fees |
|
|
2,054 |
|
|
|
1,923 |
|
|
|
1,831 |
|
|
|
1,778 |
|
|
|
1,677 |
|
Loan servicing right origination |
|
|
717 |
|
|
|
275 |
|
|
|
289 |
|
|
|
1,146 |
|
|
|
1,741 |
|
Income on OREO |
|
|
— |
|
|
|
3 |
|
|
|
— |
|
|
|
54 |
|
|
|
10 |
|
Gain on sale of securities |
|
|
101 |
|
|
|
570 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Referral fees |
|
|
110 |
|
|
|
121 |
|
|
|
17 |
|
|
|
20 |
|
|
|
53 |
|
Other |
|
|
294 |
|
|
|
237 |
|
|
|
203 |
|
|
|
161 |
|
|
|
171 |
|
Total non-interest income |
|
$ |
3,672 |
|
|
$ |
3,501 |
|
|
$ |
2,720 |
|
|
$ |
3,742 |
|
|
$ |
4,087 |
|
|
|
|
For the Three Months Ended |
|
|
|
September 30, 2020 |
|
|
June 30,2020 |
|
|
March 31, 2020 |
|
|
December 31, 2019 |
|
|
September 30, 2019 |
|
|
|
|
|
|
|
(dollars in thousands) |
|
Loan servicing rights, end of
period |
|
$ |
17,203 |
|
|
$ |
16,486 |
|
|
$ |
16,211 |
|
|
$ |
12,509 |
|
|
$ |
11,362 |
|
Loans serviced, end of
period |
|
|
797,819 |
|
|
|
762,058 |
|
|
|
747,553 |
|
|
|
751,738 |
|
|
|
736,823 |
|
Loan servicing rights as a %
of loans serviced |
|
|
2.16 |
% |
|
|
2.16 |
% |
|
|
2.17 |
% |
|
|
1.66 |
% |
|
|
1.54 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loan servicing fees |
|
$ |
2,054 |
|
|
$ |
1,923 |
|
|
$ |
1,831 |
|
|
$ |
1,778 |
|
|
$ |
1,677 |
|
Average loans serviced |
|
|
779,939 |
|
|
|
754,806 |
|
|
|
749,646 |
|
|
|
744,281 |
|
|
|
716,226 |
|
Annualized loan servicing fees
as a % of average loans serviced |
|
|
1.05 |
% |
|
|
1.02 |
% |
|
|
0.98 |
% |
|
|
0.96 |
% |
|
|
0.94 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest
Expense
- The increase in
employee compensation and benefits expense in the quarter was
primarily the result of a 4.2% increase in headcount.
- During
the third quarter of 2020, two properties in other real estate
owned totaling $0.3 million were sold for a loss of $9
thousand.
|
|
|
For the Three Months Ended |
|
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Non-Interest
Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation and
benefits |
|
$ |
4,766 |
|
|
$ |
4,594 |
|
|
$ |
5,260 |
|
|
$ |
5,696 |
|
|
$ |
4,735 |
|
Occupancy |
|
|
321 |
|
|
|
305 |
|
|
|
354 |
|
|
|
417 |
|
|
|
313 |
|
Information processing |
|
|
641 |
|
|
|
663 |
|
|
|
670 |
|
|
|
645 |
|
|
|
683 |
|
Professional fees |
|
|
555 |
|
|
|
480 |
|
|
|
401 |
|
|
|
371 |
|
|
|
483 |
|
Business development |
|
|
305 |
|
|
|
333 |
|
|
|
366 |
|
|
|
335 |
|
|
|
351 |
|
OREO expenses |
|
|
47 |
|
|
|
44 |
|
|
|
116 |
|
|
|
59 |
|
|
|
57 |
|
Writedown of OREO |
|
|
— |
|
|
|
— |
|
|
|
1,360 |
|
|
|
376 |
|
|
|
— |
|
Net loss (gain) on sale of
OREO |
|
|
9 |
|
|
|
— |
|
|
|
4 |
|
|
|
(231 |
) |
|
|
160 |
|
Depreciation and
amortization |
|
|
295 |
|
|
|
303 |
|
|
|
301 |
|
|
|
319 |
|
|
|
319 |
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
5,038 |
|
|
|
— |
|
|
|
— |
|
Other |
|
|
728 |
|
|
|
743 |
|
|
|
1,148 |
|
|
|
2,278 |
|
|
|
567 |
|
Total non-interest expense |
|
$ |
7,667 |
|
|
$ |
7,465 |
|
|
$ |
15,018 |
|
|
$ |
10,265 |
|
|
$ |
7,668 |
|
|
Asset Quality
- Watch
rated loans improved $12.8 million quarter-over-quarter and $17.4
million year-over-year.
- The
increase in substandard loans and the adverse classified asset
ratio in the quarter were primarily due to the downgrade of one
agricultural customer.
|
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands) |
|
Loans by risk
category(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sound/Acceptable/Satisfactory/Low Satisfactory |
|
$ |
800,451 |
|
|
$ |
798,945 |
|
|
$ |
706,247 |
|
|
$ |
724,444 |
|
|
$ |
771,567 |
|
Watch |
|
|
185,254 |
|
|
|
198,044 |
|
|
|
219,459 |
|
|
|
216,098 |
|
|
|
202,615 |
|
Special Mention |
|
|
1,851 |
|
|
|
1,856 |
|
|
|
15,036 |
|
|
|
9,239 |
|
|
|
9,346 |
|
Substandard Performing |
|
|
41,577 |
|
|
|
47,741 |
|
|
|
34,179 |
|
|
|
49,774 |
|
|
|
71,133 |
|
Substandard Impaired |
|
|
46,793 |
|
|
|
40,938 |
|
|
|
37,515 |
|
|
|
36,218 |
|
|
|
26,106 |
|
Total loans |
|
$ |
1,075,926 |
|
|
$ |
1,087,524 |
|
|
$ |
1,012,436 |
|
|
$ |
1,035,773 |
|
|
$ |
1,080,767 |
|
Adverse classified asset ratio
(2) |
|
|
42.64 |
% |
|
|
41.73 |
% |
|
|
32.35 |
% |
|
|
39.85 |
% |
|
|
45.67 |
% |
|
(1) Troubled debt restructurings are presented
in their internal risk rating category rather than reclassified to
substandard impaired. Prior quarters have been reclassified to
reflect this change.
(2) This is a non-GAAP financial measure. A
reconciliation to GAAP is included at the end of this earnings
release.
Non-Performing Assets
- Non-performing
assets increased in the quarter by $6.3 million, or 16.6%,
sequentially compared to the second quarter of 2020.
Year-over-year, non-performing assets increased $16.4 million, or
58.5%, due to a $11.1 million increase in non-accrual agricultural
loans and a $9.5 million increase in non-accrual commercial loans,
which were partially offset by a $4.2 million decrease in OREO
properties.
- A
provision for loan losses of $0.1 million was recorded for the
three months ended September 30, 2020 compared to a provision of $
1.1 million for the three months ended June 30, 2020. The decrease
in provision in the linked quarter was primarily the result of the
improvement of watch and substandard performing rated credits,
which was only partially offset by the increase in specific
impairments on impaired credits.
|
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands) |
|
Non-Performing
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual loans |
|
$ |
41,351 |
|
|
$ |
35,456 |
|
|
$ |
32,051 |
|
|
$ |
30,968 |
|
|
$ |
20,776 |
|
Other real estate owned |
|
|
3,064 |
|
|
|
2,629 |
|
|
|
3,247 |
|
|
|
5,521 |
|
|
|
7,252 |
|
Total non-performing assets |
|
$ |
44,415 |
|
|
$ |
38,085 |
|
|
$ |
35,298 |
|
|
$ |
36,489 |
|
|
$ |
28,028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing TDRs not on nonaccrual |
|
$ |
19,036 |
|
|
$ |
21,986 |
|
|
$ |
21,853 |
|
|
$ |
21,784 |
|
|
$ |
28,520 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-performing assets as a %
of total loans |
|
|
4.13 |
% |
|
|
3.50 |
% |
|
|
3.49 |
% |
|
|
3.52 |
% |
|
|
2.59 |
% |
Non-performing assets as a %
of total assets |
|
|
2.98 |
% |
|
|
2.52 |
% |
|
|
2.61 |
% |
|
|
2.65 |
% |
|
|
1.98 |
% |
Allowance for loan losses as a
% of total loans |
|
|
1.73 |
% |
|
|
1.71 |
% |
|
|
1.73 |
% |
|
|
1.47 |
% |
|
|
1.39 |
% |
Net charge-offs (recoveries)
quarter-to-date |
|
$ |
(1 |
) |
|
$ |
120 |
|
|
$ |
(62 |
) |
|
$ |
(253 |
) |
|
$ |
39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conference Call
The Company will host an earnings call tomorrow,
October 23, 2020, at 8:30 a.m., CDT, conducted by Timothy J.
Schneider, President, and Glen L. Stiteley, CFO. The earnings call
will be broadcast over the Internet on the Company’s website at
Investors.ICBK.com. In addition, you may listen to the Company’s
earnings call via telephone by dialing (844) 835-9984. Investors
should visit the Company’s website or call in to the dial-in number
set forth above at least 10 minutes prior to the scheduled start of
the call.
A replay of the earnings call will be available
until October 23, 2021, by visiting the Company’s website at
Investors.ICBK.com/QuarterlyResults.
About County
Bancorp, Inc.
County Bancorp, Inc., a Wisconsin corporation
and registered bank holding company founded in May 1996, and its
wholly owned subsidiary Investors Community Bank, a
Wisconsin-chartered bank, are headquartered in Manitowoc,
Wisconsin. The state of Wisconsin is often referred to as
“America’s Dairyland,” and one of the niches it has developed is
providing financial services to agricultural businesses statewide,
with a primary focus on dairy-related lending. It also serves
business and retail customers throughout Wisconsin, with a focus on
northeastern and central Wisconsin. Its customers are served from
its full-service locations in Manitowoc, Appleton, Green Bay, and
Stevens Point and its loan production offices in Darlington, Eau
Claire, Fond du Lac, and Sheboygan.
Forward-Looking
Statements
This press release includes "forward-looking
statements” within the meaning of such term in the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are subject to known and unknown risks and
uncertainties, many of which may be beyond the Company’s control.
The Company cautions you that the forward-looking statements
presented in this press release are not a guarantee of future
events, and that actual events may differ materially from those
made in or suggested by the forward-looking information contained
in this press release. Forward-looking statements generally can be
identified by the use of forward-looking terminology such as "may,"
"plan," "seek," "will," "expect," "intend," "estimate,"
"anticipate," "believe" or "continue" or the negative thereof or
variations thereon or similar terminology. Factors that may cause
actual results to differ materially from those made or suggested by
the forward-looking statements contained in this press release
include those identified in the Company’s most recent annual report
on Form 10-K and subsequent filings with the Securities and
Exchange Commission, including the effects of the COVID-19 pandemic
and its potential effects on the economic environment, our
customers and our operations, as well as, any changes to federal,
state, or local government laws, regulations, or orders in
connection with the pandemic. Any forward-looking statements
presented herein are made only as of the date of this press
release, and the Company does not undertake any obligation to
update or revise any forward-looking statements to reflect changes
in assumptions, the occurrence of unanticipated events, or
otherwise.
Investor Relations ContactGlen L. StiteleyEVP -
CFO, Investors Community BankPhone: (920) 686-5658 Email:
gstiteley@icbk.com
|
|
County Bancorp,
Inc.Consolidated Financial
Summary(Unaudited) |
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Period-End Balance
Sheet: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
53,283 |
|
|
$ |
127,432 |
|
|
$ |
21,545 |
|
|
$ |
129,011 |
|
|
$ |
120,845 |
|
Securities available-for-sale, at fair value |
|
|
298,476 |
|
|
|
226,971 |
|
|
|
246,148 |
|
|
|
158,733 |
|
|
|
154,962 |
|
Loans held for sale |
|
|
2,593 |
|
|
|
11,847 |
|
|
|
14,388 |
|
|
|
2,151 |
|
|
|
4,192 |
|
Agricultural loans |
|
|
619,617 |
|
|
|
624,340 |
|
|
|
642,066 |
|
|
|
659,725 |
|
|
|
673,742 |
|
Commercial loans |
|
|
317,782 |
|
|
|
328,368 |
|
|
|
325,310 |
|
|
|
331,723 |
|
|
|
360,132 |
|
Paycheck Protection Plan loans |
|
|
98,421 |
|
|
|
103,317 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Multi-family real estate loans |
|
|
35,496 |
|
|
|
30,439 |
|
|
|
42,198 |
|
|
|
41,070 |
|
|
|
43,487 |
|
Residential real estate loans |
|
|
4,489 |
|
|
|
975 |
|
|
|
2,753 |
|
|
|
2,888 |
|
|
|
3,183 |
|
Installment and consumer other |
|
|
121 |
|
|
|
85 |
|
|
|
109 |
|
|
|
367 |
|
|
|
223 |
|
Total loans |
|
|
1,075,926 |
|
|
|
1,087,524 |
|
|
|
1,012,436 |
|
|
|
1,035,773 |
|
|
|
1,080,767 |
|
Allowance for loan losses |
|
|
(18,649 |
) |
|
|
(18,569 |
) |
|
|
(17,547 |
) |
|
|
(15,267 |
) |
|
|
(15,065 |
) |
Net loans |
|
|
1,057,277 |
|
|
|
1,068,955 |
|
|
|
994,889 |
|
|
|
1,020,506 |
|
|
|
1,065,702 |
|
Other assets |
|
|
80,426 |
|
|
|
78,712 |
|
|
|
78,004 |
|
|
|
68,378 |
|
|
|
69,263 |
|
Total Assets |
|
$ |
1,492,055 |
|
|
$ |
1,513,917 |
|
|
$ |
1,354,974 |
|
|
$ |
1,378,779 |
|
|
$ |
1,414,964 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
$ |
158,798 |
|
|
$ |
149,963 |
|
|
$ |
117,434 |
|
|
$ |
138,489 |
|
|
$ |
117,224 |
|
NOW accounts and interest checking |
|
|
78,026 |
|
|
|
81,656 |
|
|
|
64,873 |
|
|
|
63,781 |
|
|
|
56,637 |
|
Savings |
|
|
11,900 |
|
|
|
8,369 |
|
|
|
6,566 |
|
|
|
15,708 |
|
|
|
6,981 |
|
Money market accounts |
|
|
325,900 |
|
|
|
307,083 |
|
|
|
237,889 |
|
|
|
242,539 |
|
|
|
248,608 |
|
Time deposits |
|
|
322,992 |
|
|
|
346,482 |
|
|
|
364,930 |
|
|
|
375,100 |
|
|
|
388,759 |
|
Brokered deposits |
|
|
101,808 |
|
|
|
121,503 |
|
|
|
161,882 |
|
|
|
166,340 |
|
|
|
206,474 |
|
National time deposits |
|
|
50,747 |
|
|
|
57,997 |
|
|
|
66,386 |
|
|
|
99,485 |
|
|
|
118,070 |
|
Total deposits |
|
|
1,050,171 |
|
|
|
1,073,053 |
|
|
|
1,019,960 |
|
|
|
1,101,442 |
|
|
|
1,142,753 |
|
Federal Reserve Discount Window advances |
|
|
99,693 |
|
|
|
99,693 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
FHLB advances |
|
|
84,600 |
|
|
|
93,400 |
|
|
|
109,400 |
|
|
|
44,400 |
|
|
|
44,400 |
|
Subordinated debentures |
|
|
67,025 |
|
|
|
61,910 |
|
|
|
44,896 |
|
|
|
44,858 |
|
|
|
44,820 |
|
Other liabilities |
|
|
20,656 |
|
|
|
17,336 |
|
|
|
15,672 |
|
|
|
16,050 |
|
|
|
14,239 |
|
Total Liabilities |
|
|
1,322,145 |
|
|
|
1,345,392 |
|
|
|
1,189,928 |
|
|
|
1,206,750 |
|
|
|
1,246,212 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
169,910 |
|
|
|
168,525 |
|
|
|
165,046 |
|
|
|
172,029 |
|
|
|
168,752 |
|
Total Liabilities and
Shareholders' Equity |
|
$ |
1,492,055 |
|
|
$ |
1,513,917 |
|
|
$ |
1,354,974 |
|
|
$ |
1,378,779 |
|
|
$ |
1,414,964 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Price
Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
High - Quarter-to-date |
|
$ |
22.00 |
|
|
$ |
24.67 |
|
|
$ |
27.19 |
|
|
$ |
27.98 |
|
|
$ |
20.99 |
|
Low - Quarter-to-date |
|
$ |
17.04 |
|
|
$ |
17.13 |
|
|
$ |
13.55 |
|
|
$ |
18.76 |
|
|
$ |
16.80 |
|
Market price - Quarter-end |
|
$ |
18.80 |
|
|
$ |
20.93 |
|
|
$ |
18.50 |
|
|
$ |
25.63 |
|
|
$ |
19.62 |
|
Book value per share |
|
$ |
25.72 |
|
|
$ |
25.18 |
|
|
$ |
24.17 |
|
|
$ |
24.32 |
|
|
$ |
23.89 |
|
Tangible book value per share (1) |
|
$ |
25.71 |
|
|
$ |
25.16 |
|
|
$ |
24.15 |
|
|
$ |
23.58 |
|
|
$ |
23.10 |
|
Common shares outstanding |
|
|
6,294,675 |
|
|
|
6,375,150 |
|
|
|
6,496,790 |
|
|
|
6,734,132 |
|
|
|
6,727,908 |
|
(1) This is a non-GAAP financial measure. A reconciliation to
GAAP is included below.
|
|
|
For the Three Months Ended |
|
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Selected Income
Statement Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and Dividend Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, including fees(1) |
|
$ |
11,594 |
|
|
$ |
12,009 |
|
|
$ |
12,565 |
|
|
$ |
13,671 |
|
|
$ |
14,977 |
|
Taxable securities |
|
|
1,293 |
|
|
|
1,283 |
|
|
|
1,282 |
|
|
|
1,106 |
|
|
|
1,117 |
|
Tax-exempt securities |
|
|
167 |
|
|
|
162 |
|
|
|
6 |
|
|
|
— |
|
|
|
— |
|
Federal funds sold and other |
|
|
52 |
|
|
|
111 |
|
|
|
225 |
|
|
|
442 |
|
|
|
612 |
|
Total interest and
dividend income |
|
|
13,106 |
|
|
|
13,565 |
|
|
|
14,078 |
|
|
|
15,219 |
|
|
|
16,706 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
2,914 |
|
|
|
3,721 |
|
|
|
4,347 |
|
|
|
4,781 |
|
|
|
5,574 |
|
FHLB advances and other borrowed funds |
|
|
456 |
|
|
|
343 |
|
|
|
244 |
|
|
|
225 |
|
|
|
246 |
|
Subordinated debentures |
|
|
1,082 |
|
|
|
736 |
|
|
|
706 |
|
|
|
695 |
|
|
|
687 |
|
Total interest expense |
|
|
4,452 |
|
|
|
4,800 |
|
|
|
5,297 |
|
|
|
5,701 |
|
|
|
6,507 |
|
Net interest income |
|
|
8,654 |
|
|
|
8,765 |
|
|
|
8,781 |
|
|
|
9,518 |
|
|
|
10,199 |
|
Provision for loan losses |
|
|
79 |
|
|
|
1,142 |
|
|
|
2,218 |
|
|
|
(51 |
) |
|
|
(1,154 |
) |
Net interest income after provision for loan losses |
|
|
8,575 |
|
|
|
7,623 |
|
|
|
6,563 |
|
|
|
9,569 |
|
|
|
11,353 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services charges |
|
|
379 |
|
|
|
368 |
|
|
|
342 |
|
|
|
549 |
|
|
|
348 |
|
Gain on sale of loans, net |
|
|
17 |
|
|
|
4 |
|
|
|
38 |
|
|
|
34 |
|
|
|
87 |
|
Loan servicing fees |
|
|
2,054 |
|
|
|
1,923 |
|
|
|
1,831 |
|
|
|
1,778 |
|
|
|
1,677 |
|
Loan servicing right origination |
|
|
717 |
|
|
|
275 |
|
|
|
289 |
|
|
|
1,146 |
|
|
|
1,741 |
|
Income on OREO |
|
|
— |
|
|
|
3 |
|
|
|
— |
|
|
|
54 |
|
|
|
10 |
|
Gain on sale of securities |
|
|
101 |
|
|
|
570 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Referral fees |
|
|
110 |
|
|
|
121 |
|
|
|
17 |
|
|
|
20 |
|
|
|
53 |
|
Other |
|
|
294 |
|
|
|
237 |
|
|
|
203 |
|
|
|
161 |
|
|
|
171 |
|
Total non-interest income |
|
|
3,672 |
|
|
|
3,501 |
|
|
|
2,720 |
|
|
|
3,742 |
|
|
|
4,087 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation and benefits |
|
|
4,766 |
|
|
|
4,594 |
|
|
|
5,260 |
|
|
|
5,696 |
|
|
|
4,735 |
|
Occupancy |
|
|
321 |
|
|
|
305 |
|
|
|
354 |
|
|
|
417 |
|
|
|
313 |
|
Information processing |
|
|
641 |
|
|
|
663 |
|
|
|
670 |
|
|
|
645 |
|
|
|
683 |
|
Professional fees |
|
|
555 |
|
|
|
480 |
|
|
|
401 |
|
|
|
371 |
|
|
|
483 |
|
Business development |
|
|
305 |
|
|
|
333 |
|
|
|
366 |
|
|
|
335 |
|
|
|
351 |
|
OREO expenses |
|
|
47 |
|
|
|
44 |
|
|
|
116 |
|
|
|
59 |
|
|
|
57 |
|
Writedown of OREO |
|
|
— |
|
|
|
— |
|
|
|
1,360 |
|
|
|
376 |
|
|
|
— |
|
Net loss (gain) on sale of OREO |
|
|
9 |
|
|
|
— |
|
|
|
4 |
|
|
|
(231 |
) |
|
|
160 |
|
Depreciation and amortization |
|
|
295 |
|
|
|
303 |
|
|
|
301 |
|
|
|
319 |
|
|
|
319 |
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
5,038 |
|
|
|
— |
|
|
|
— |
|
Other |
|
|
728 |
|
|
|
743 |
|
|
|
1,148 |
|
|
|
2,278 |
|
|
|
567 |
|
Total non-interest expense |
|
|
7,667 |
|
|
|
7,465 |
|
|
|
15,018 |
|
|
|
10,265 |
|
|
|
7,668 |
|
Income before income taxes |
|
|
4,580 |
|
|
|
3,659 |
|
|
|
(5,735 |
) |
|
|
3,046 |
|
|
|
7,772 |
|
Income tax expense (benefit) |
|
|
1,164 |
|
|
|
926 |
|
|
|
(547 |
) |
|
|
(258 |
) |
|
|
2,090 |
|
NET INCOME (LOSS) |
|
$ |
3,416 |
|
|
$ |
2,733 |
|
|
$ |
(5,188 |
) |
|
$ |
3,304 |
|
|
$ |
5,682 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per share |
|
$ |
0.52 |
|
|
$ |
0.40 |
|
|
$ |
(0.79 |
) |
|
$ |
0.47 |
|
|
$ |
0.82 |
|
Diluted earnings (loss) per share |
|
$ |
0.52 |
|
|
$ |
0.40 |
|
|
$ |
(0.78 |
) |
|
$ |
0.47 |
|
|
$ |
0.82 |
|
Dividends declared per share |
|
$ |
0.07 |
|
|
$ |
0.07 |
|
|
$ |
0.07 |
|
|
$ |
0.05 |
|
|
$ |
0.05 |
|
(1) Referral fees reclassed to non-interest income to match
current classification
|
|
|
For the Three Months Ended |
|
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands, except share data) |
|
Other
Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets (1) |
|
|
0.91 |
% |
|
|
0.74 |
% |
|
|
(1.53 |
)% |
|
|
0.96 |
% |
|
|
1.57 |
% |
Return on average shareholders' equity (1) |
|
|
8.05 |
% |
|
|
6.55 |
% |
|
|
(11.97 |
)% |
|
|
7.74 |
% |
|
|
13.73 |
% |
Return on average common shareholders' equity (1)(2) |
|
|
8.25 |
% |
|
|
6.63 |
% |
|
|
(12.81 |
)% |
|
|
7.83 |
% |
|
|
14.14 |
% |
Efficiency ratio (1)(2) |
|
|
62.64 |
% |
|
|
63.83 |
% |
|
|
74.92 |
% |
|
|
67.65 |
% |
|
|
52.55 |
% |
Equity to assets ratio |
|
|
11.39 |
% |
|
|
11.13 |
% |
|
|
12.18 |
% |
|
|
12.48 |
% |
|
|
11.93 |
% |
Tangible common equity to tangible assets (2) |
|
|
10.85 |
% |
|
|
10.60 |
% |
|
|
11.58 |
% |
|
|
11.56 |
% |
|
|
11.03 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Share
Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations |
|
$ |
3,416 |
|
|
$ |
2,733 |
|
|
$ |
(5,188 |
) |
|
$ |
3,304 |
|
|
$ |
5,682 |
|
Less: Preferred stock dividends |
|
|
80 |
|
|
|
99 |
|
|
|
108 |
|
|
|
117 |
|
|
|
120 |
|
Income available to common shareholders |
|
$ |
3,336 |
|
|
$ |
2,634 |
|
|
$ |
(5,296 |
) |
|
$ |
3,187 |
|
|
$ |
5,562 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares issued |
|
|
7,202,000 |
|
|
|
7,198,901 |
|
|
|
7,182,945 |
|
|
|
7,173,290 |
|
|
|
7,168,785 |
|
Less: Weighted average treasury shares |
|
|
882,153 |
|
|
|
759,294 |
|
|
|
518,740 |
|
|
|
443,920 |
|
|
|
443,920 |
|
Plus: Weighted average non-vested restricted stock units |
|
|
66,492 |
|
|
|
65,291 |
|
|
|
39,785 |
|
|
|
32,125 |
|
|
|
32,125 |
|
Weighted average number of common shares outstanding |
|
|
6,386,339 |
|
|
|
6,504,898 |
|
|
|
6,703,990 |
|
|
|
6,761,495 |
|
|
|
6,756,990 |
|
Effect of dilutive options |
|
|
20,915 |
|
|
|
28,511 |
|
|
|
49,072 |
|
|
|
44,630 |
|
|
|
19,160 |
|
Weighted average number of common shares outstanding used to
calculate diluted earnings per common share |
|
|
6,407,254 |
|
|
|
6,533,409 |
|
|
|
6,753,062 |
|
|
|
6,806,125 |
|
|
|
6,776,150 |
|
(1) Annualized(2) This is a non-GAAP financial measure. A
reconciliation to GAAP is included below.
Non-GAAP Financial Measures:
|
|
For the Three Months Ended |
|
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands) |
|
Return on average
common shareholders' equity
reconciliation (1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average shareholders' equity |
|
|
8.05 |
% |
|
|
6.55 |
% |
|
|
(11.97 |
)% |
|
|
7.74 |
% |
|
|
13.73 |
% |
Effect of excluding average preferred shareholders' equity |
|
|
0.20 |
% |
|
|
0.08 |
% |
|
|
(0.84 |
)% |
|
|
0.09 |
% |
|
|
0.41 |
% |
Return on average common shareholders' equity |
|
|
8.25 |
% |
|
|
6.63 |
% |
|
|
(12.81 |
)% |
|
|
7.83 |
% |
|
|
14.14 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency
ratio (2): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest expense |
|
$ |
7,667 |
|
|
$ |
7,465 |
|
|
$ |
15,018 |
|
|
$ |
10,265 |
|
|
$ |
7,668 |
|
Less: goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
(5,038 |
) |
|
|
— |
|
|
|
— |
|
Less: historical tax credit investment impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,149 |
) |
|
|
— |
|
Less: net loss on sales and write-downs of OREO |
|
|
(9 |
) |
|
|
— |
|
|
|
(1,364 |
) |
|
|
(145 |
) |
|
|
(160 |
) |
Adjusted non-interest expense (non-GAAP) |
|
$ |
7,658 |
|
|
$ |
7,465 |
|
|
$ |
8,616 |
|
|
$ |
8,971 |
|
|
$ |
7,508 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
8,654 |
|
|
$ |
8,765 |
|
|
$ |
8,781 |
|
|
$ |
9,518 |
|
|
$ |
10,199 |
|
Non-interest income |
|
|
3,672 |
|
|
|
3,501 |
|
|
|
2,720 |
|
|
|
3,742 |
|
|
|
4,087 |
|
Less: net gain on sales of securities |
|
|
(101 |
) |
|
|
(570 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Operating revenue |
|
$ |
12,225 |
|
|
$ |
11,696 |
|
|
$ |
11,501 |
|
|
$ |
13,260 |
|
|
$ |
14,286 |
|
Efficiency ratio |
|
|
62.64 |
% |
|
|
63.83 |
% |
|
|
74.92 |
% |
|
|
67.65 |
% |
|
|
52.55 |
% |
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
|
|
September 30,2020 |
|
|
September 30,2019 |
|
|
September 30,2020 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Adjusted diluted
earnings per
share(3): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations |
|
$ |
3,416 |
|
|
$ |
5,682 |
|
|
$ |
961 |
|
|
$ |
13,148 |
|
Less: preferred stock dividends |
|
|
(80 |
) |
|
|
(120 |
) |
|
|
(286 |
) |
|
|
(355 |
) |
Plus: goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
5,038 |
|
|
|
— |
|
Adjusted income available to common shareholders for basic earnings
per common share |
|
$ |
3,336 |
|
|
$ |
5,562 |
|
|
$ |
5,713 |
|
|
$ |
12,793 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding |
|
|
6,386,339 |
|
|
|
6,756,990 |
|
|
|
6,531,041 |
|
|
|
6,742,892 |
|
Effect of dilutive options |
|
|
20,915 |
|
|
|
19,160 |
|
|
|
32,833 |
|
|
|
19,063 |
|
Weighted average number of common shares outstanding used to
calculate diluted earnings per common share |
|
|
6,407,254 |
|
|
|
6,776,150 |
|
|
|
6,563,874 |
|
|
|
6,761,955 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted diluted earnings per
share |
|
$ |
0.52 |
|
|
$ |
0.82 |
|
|
$ |
0.87 |
|
|
$ |
1.89 |
|
(1) Management uses the return on average common
shareholders’ equity to review our core operating results and our
performance.(2) In our judgment, the adjustments made to
non-interest expense allow investors to better assess our operating
expenses in relation to our core operating revenue by removing the
volatility that is associated with certain one-time items and other
discrete items that are unrelated to our core business. (3) In our
judgment, the adjustment made to diluted earnings per share allows
investors to better assess our income related to core operations by
removing the volatility associated with the goodwill impairment
which was a one-time, non-cash expense.Non-GAAP Financial
Measures (continued):
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
December 31,2019 |
|
|
September 30,2019 |
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Tangible book value
per share and tangible common equity to
tangible assets
reconciliation(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity |
|
$ |
161,910 |
|
|
$ |
160,525 |
|
|
$ |
157,046 |
|
|
$ |
164,029 |
|
|
$ |
160,752 |
|
Less: Goodwill |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,038 |
|
|
|
5,038 |
|
Less: Core deposit intangible, net of amortization |
|
|
86 |
|
|
|
125 |
|
|
|
171 |
|
|
|
225 |
|
|
|
286 |
|
Tangible common equity (non-GAAP) |
|
$ |
161,824 |
|
|
$ |
160,400 |
|
|
$ |
156,875 |
|
|
$ |
158,766 |
|
|
$ |
155,428 |
|
Common shares outstanding |
|
|
6,294,675 |
|
|
|
6,375,150 |
|
|
|
6,496,790 |
|
|
|
6,734,132 |
|
|
|
6,727,908 |
|
Tangible book value per share |
|
$ |
25.71 |
|
|
$ |
25.16 |
|
|
$ |
24.15 |
|
|
$ |
23.58 |
|
|
$ |
23.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
1,492,055 |
|
|
$ |
1,513,917 |
|
|
$ |
1,354,974 |
|
|
$ |
1,378,779 |
|
|
$ |
1,414,964 |
|
Less: Goodwill |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,038 |
|
|
|
5,038 |
|
Less: Core deposit intangible, net of amortization |
|
|
86 |
|
|
|
125 |
|
|
|
171 |
|
|
|
603 |
|
|
|
701 |
|
Tangible assets (non-GAAP) |
|
$ |
1,491,969 |
|
|
$ |
1,513,792 |
|
|
$ |
1,354,803 |
|
|
$ |
1,373,138 |
|
|
$ |
1,409,225 |
|
Tangible common equity to tangible assets |
|
|
10.85 |
% |
|
|
10.60 |
% |
|
|
11.58 |
% |
|
|
11.56 |
% |
|
|
11.03 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adverse classified
asset ratio(2): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Substandard loans |
|
$ |
88,370 |
|
|
$ |
88,680 |
|
|
$ |
71,694 |
|
|
$ |
85,992 |
|
|
$ |
97,239 |
|
Other real estate owned |
|
|
3,064 |
|
|
|
2,629 |
|
|
|
3,247 |
|
|
|
5,521 |
|
|
|
7,252 |
|
Substandard unused commitments |
|
|
5,124 |
|
|
|
3,230 |
|
|
|
2,840 |
|
|
|
2,849 |
|
|
|
991 |
|
Less: Substandard government guarantees |
|
|
(7,002 |
) |
|
|
(6,336 |
) |
|
|
(7,699 |
) |
|
|
(7,892 |
) |
|
|
(7,746 |
) |
Total adverse classified assets (non-GAAP) |
|
$ |
89,556 |
|
|
$ |
88,203 |
|
|
$ |
70,082 |
|
|
$ |
86,470 |
|
|
$ |
97,736 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity (Bank) |
|
$ |
200,011 |
|
|
$ |
201,507 |
|
|
$ |
204,089 |
|
|
$ |
204,240 |
|
|
$ |
201,967 |
|
Accumulated other comprehensive loss (gain) on available for sale
securities |
|
|
(8,640 |
) |
|
|
(8,734 |
) |
|
|
(5,012 |
) |
|
|
(2,505 |
) |
|
|
(3,016 |
) |
Allowance for loan losses |
|
|
18,649 |
|
|
|
18,569 |
|
|
|
17,547 |
|
|
|
15,267 |
|
|
|
15,065 |
|
Adjusted total equity (non-GAAP) |
|
$ |
210,020 |
|
|
$ |
211,342 |
|
|
$ |
216,624 |
|
|
$ |
217,002 |
|
|
$ |
214,016 |
|
Adverse classified asset ratio |
|
|
42.64 |
% |
|
|
41.73 |
% |
|
|
32.35 |
% |
|
|
39.85 |
% |
|
|
45.67 |
% |
(1) In our judgment, the adjustments made to
book value, equity and assets allow investors to better assess our
capital adequacy and net worth by removing the effect of goodwill
and intangible assets that are unrelated to our core business.(2)
The adjustments made to non-performing assets allow management to
better assess asset quality and monitor the amount of capital
coverage necessary for non-performing assets.
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