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 first quarter of 2021. Net income was $3.9 million,
or $0.62 per diluted share, for the first quarter of 2021, compared
to net loss of $5.2 million, or $0.78 diluted loss per share, for
the first quarter of 2020. The net loss for the first quarter of
2020 included a $5.0 million goodwill impairment charge, or $0.77
loss per diluted share.
Tim Schneider, President of County Bancorp,
Inc., noted, “I’m highly encouraged by our strong start to the
year, and based on positive movements in credit migration and
overall improvements in watch and worse rated credits, we continue
to expect this to be a strong fiscal year for County Bancorp. We
expect to see continued improvement in our overall credit metrics
as the dairy market continues to rebound and we conduct our annual
credit review of our dairy loan portfolio in the second quarter of
2021. Additionally, shortly after quarter-end, we received a
settlement on a nonperforming hotel loan, resulting in a loan loss
recovery for that credit in the second quarter of 2021.
Schneider continued, “We also demonstrated our
faith in Country Bancorp's long-term value by extending our share
repurchase program and purchasing more than 100,000 shares during
the first quarter. I am confident that we have the right strategy
to maintain our momentum and deliver consistent long-term growth.
We look forward to partnering and growing with our commercial,
agricultural, and consumer customers in 2021 and beyond.”
Loans and Securities
- Total
loans increased sequentially by $15.4 million, or 1.5%, to $1.0
billion during the first quarter of 2021. The increase in total
loans was primarily due to $32.6 million of second round Paycheck
Protection Program (“PPP”) loans originated during the quarter,
which was partially offset by the forgiveness of $24.1 million of
first round PPP loans by the Small Business Administration (“SBA”).
The following table sets forth the total PPP loans at the dates
indicated:
|
|
March 31, 2021 |
|
|
December 31, 2020 |
|
|
|
# of Loans |
|
|
Balance |
|
|
Deferred Fee Income |
|
|
# of Loans |
|
|
Balance |
|
|
Deferred Fee Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
PPP 1oans - Round 1 |
|
|
127 |
|
|
$ |
13,674 |
|
|
$ |
301 |
|
|
|
456 |
|
|
$ |
37,790 |
|
|
$ |
1,191 |
|
PPP loans - Round 2 |
|
|
461 |
|
|
|
32,595 |
|
|
|
1,479 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total PPP loans |
|
|
588 |
|
|
$ |
46,269 |
|
|
$ |
1,780 |
|
|
|
456 |
|
|
$ |
37,790 |
|
|
$ |
1,191 |
|
% of Total loans |
|
|
|
|
|
|
4.57 |
% |
|
|
|
|
|
|
|
|
|
|
3.79 |
% |
|
|
|
|
- As of March 31,
2021, there were five customer relationships with loans in payment
deferral associated with COVID-19 customer support programs
totaling $6.1 million, or 0.6% of total loans, which is a decrease
of $16.8 million, or 63.5%, since December 31, 2020.
- Loan
participations the Company continued to service were $841.9 million
as of March 31, 2021, an increase of $29.3 million, or 3.6%,
compared to December 31, 2020, and an increase of $94.3 million, or
12.6%, compared to March 31, 2020.
- During the first
quarter of 2021, investments increased by $32.4 million, or 9.2%,
and increased $139.1 million, or 56.5%, since March 31, 2020. There
were no security sales during the first quarter of 2021.
Deposits
- Total deposits as
of March 31, 2021 were $1.1 billion, an increase of $57.7 million,
or 5.5%, from December 31, 2020, and an increase of $78.6 million,
or 7.7% since March 31, 2020.
- Client deposits
(demand deposits, NOW accounts, savings accounts, money market
accounts, and certificates of deposit) decreased slightly by $2.8
million, or 0.3%, from December 31, 2020 to $913.2 million, which
was expected due to seasonal attrition. Year-over-year, client
deposits increased $121.5 million, or 15.3%, since March 31,
2020.
- The Company
increased its brokered deposits and national certificate of
deposits by $60.5 million, or 48.5%, during the first quarter of
2021 in order to facilitate investment purchases. Despite the
additional brokered deposits in the first quarter, wholesale
funding decreased $49.9 million, or 18.8%, since March 31,
2020.
Shareholders’ Equity
- During the first
quarter of 2021, the Company repurchased 109,862 shares of its
common stock, totaling $2.5 million, at a weighted average price of
$22.87 per share.
- Book value per
share decreased to $25.99 per share on March 31, 2021 from $26.42
on December 31, 2020, due primarily to a $6.4 million unrealized
loss on our securities portfolio in the first quarter of 2021.
Net Interest Income and
Margin
- Net
interest margin for the quarter ended March 31, 2021 was 2.95%,
which declined 11 basis points compared to the sequential quarter
and increased 21 basis points year-over-year. The following table
shows the accretive effect the SBA PPP loans had on net interest
margin for the periods indicated.
|
|
For the Three Months Ended |
|
|
|
March 31,2021 |
|
|
December 31,2020 |
|
Net interest margin excluding PPP loans |
|
|
2.74 |
% |
|
|
2.49 |
% |
Accretion related to PPP loans: |
|
|
|
|
|
|
|
|
Yield on PPP loans |
|
|
(0.06 |
)% |
|
|
(0.13 |
)% |
Yield on PPP loan SBA fees |
|
|
0.29 |
% |
|
|
0.81 |
% |
Interest expense on PPP Liquidity Facility programs |
|
|
(0.02 |
)% |
|
|
(0.11 |
)% |
Total accretion related to PPP loans |
|
|
0.21 |
% |
|
|
0.57 |
% |
Total net interest margin |
|
|
2.95 |
% |
|
|
3.06 |
% |
- Net interest
margin was positively impacted by approximately 15 basis points
during the first quarter of 2021, due to the recovery of $0.5
million in interest income related to a nonaccrual loan
participation.
- Loan interest
income (including fees) decreased $1.2 million sequentially
primarily due to fewer PPP loans forgiven by the SBA in the first
quarter of 2021 compared to the fourth quarter of 2020, which
resulted in fewer origination fees being recognized as interest
income. During the first quarter of 2021, $24.1 million of PPP
loans were forgiven compared to $60.6 million during the fourth
quarter of 2020. Year-over-year, loan interest income decreased
$1.1 million primarily due to lower yields on the previously
mentioned PPP loans and decrease the in federal funds target
rates.
- Total
rates paid on interest-bearing deposits decreased by 22 basis
points to 0.91% for the three months ended March 31, 2021, compared
to the three months ended December 31, 2020, and decreased 92 basis
points compared to the three months ended March 31, 2020. The
decrease was primarily due to the Company’s renewed focus on
gathering lower-cost transactional deposits versus higher cost time
deposits and the market-driven drop in the federal funds
rates.
The table below presents the effects of changing
rates and volumes on net interest income for the periods
indicated.
|
|
Three Months Ended March 31, 2021 v.Three Months Ended December 31,
2020 |
|
|
Three Months Ended March 31, 2021 v.Three Months Ended March 31,
2020 |
|
|
|
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 |
|
$ |
246 |
|
|
$ |
(37 |
) |
|
$ |
209 |
|
|
$ |
1,003 |
|
|
$ |
(105 |
) |
|
$ |
898 |
|
Loans (excluding PPP) |
|
|
5 |
|
|
|
271 |
|
|
|
276 |
|
|
|
(752 |
) |
|
|
(1,351 |
) |
|
|
(2,103 |
) |
PPP loans - round 1 |
|
|
(1,610 |
) |
|
|
37 |
|
|
|
(1,573 |
) |
|
|
(678 |
) |
|
|
1,639 |
|
|
|
961 |
|
PPP loans - round 2 |
|
|
1,213 |
|
|
|
(1,130 |
) |
|
|
83 |
|
|
|
1,213 |
|
|
|
(1,130 |
) |
|
|
83 |
|
Total loans |
|
|
(392 |
) |
|
|
(822 |
) |
|
|
(1,214 |
) |
|
|
(217 |
) |
|
|
(842 |
) |
|
|
(1,059 |
) |
Federal funds sold and interest-bearing deposits with banks |
|
|
(4 |
) |
|
|
(1 |
) |
|
|
(5 |
) |
|
|
(92 |
) |
|
|
(128 |
) |
|
|
(220 |
) |
Total interest income |
|
|
(150 |
) |
|
|
(860 |
) |
|
|
(1,010 |
) |
|
|
694 |
|
|
|
(1,075 |
) |
|
|
(381 |
) |
Interest
Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW, money market and interest checking |
|
$ |
(16 |
) |
|
$ |
13 |
|
|
$ |
(3 |
) |
|
$ |
750 |
|
|
$ |
(1,144 |
) |
|
$ |
(394 |
) |
Time deposits |
|
|
(38 |
) |
|
|
(371 |
) |
|
|
(409 |
) |
|
|
(854 |
) |
|
|
(1,030 |
) |
|
|
(1,884 |
) |
Other borrowings |
|
|
(24 |
) |
|
|
(5 |
) |
|
|
(29 |
) |
|
|
38 |
|
|
|
(1 |
) |
|
|
37 |
|
FHLB advances |
|
|
(15 |
) |
|
|
3 |
|
|
|
(12 |
) |
|
|
68 |
|
|
|
(27 |
) |
|
|
41 |
|
Junior subordinated debentures |
|
|
— |
|
|
|
(1 |
) |
|
|
(1 |
) |
|
|
355 |
|
|
|
45 |
|
|
|
400 |
|
Total interest expense |
|
$ |
(93 |
) |
|
$ |
(361 |
) |
|
$ |
(454 |
) |
|
$ |
357 |
|
|
$ |
(2,157 |
) |
|
$ |
(1,800 |
) |
Net interest income |
|
$ |
(57 |
) |
|
$ |
(499 |
) |
|
$ |
(556 |
) |
|
$ |
337 |
|
|
$ |
1,082 |
|
|
$ |
1,419 |
|
The following table sets forth average balances,
average yields and rates, and income and expenses for the periods
indicated.
|
|
For the Three Months Ended |
|
|
|
March 31, 2021 |
|
|
December 31, 2020 |
|
|
March 31, 2020 |
|
|
|
AverageBalance (1) |
|
|
Income/Expense |
|
|
Yields/Rates |
|
|
AverageBalance (1) |
|
|
Income/Expense |
|
|
Yields/Rates |
|
|
AverageBalance (1) |
|
|
Income/Expense |
|
|
Yields/Rates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities |
|
$ |
372,235 |
|
|
$ |
2,187 |
|
|
|
2.38 |
% |
|
$ |
322,706 |
|
|
$ |
1,978 |
|
|
|
2.44 |
% |
|
$ |
196,353 |
|
|
$ |
1,289 |
|
|
|
2.63 |
% |
Loans excluding PPP loans (2) |
|
|
969,429 |
|
|
|
10,479 |
|
|
|
4.38 |
% |
|
|
968,575 |
|
|
|
10,203 |
|
|
|
4.19 |
% |
|
|
1,028,637 |
|
|
|
12,582 |
|
|
|
4.89 |
% |
PPP loans - Round 1 (2) |
|
|
27,252 |
|
|
|
961 |
|
|
|
14.30 |
% |
|
|
71,505 |
|
|
|
2,534 |
|
|
|
14.10 |
% |
|
|
— |
|
|
|
— |
|
|
|
— |
|
PPP loans - Round 2 (2) |
|
|
16,857 |
|
|
|
83 |
|
|
|
2.01 |
% |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total loans (2) |
|
|
1,013,538 |
|
|
|
11,523 |
|
|
|
4.61 |
% |
|
|
1,040,080 |
|
|
|
12,737 |
|
|
|
4.87 |
% |
|
|
1,028,637 |
|
|
|
12,582 |
|
|
|
4.89 |
% |
Interest bearing deposits due from other banks |
|
|
19,949 |
|
|
|
5 |
|
|
|
0.10 |
% |
|
|
37,385 |
|
|
|
10 |
|
|
|
0.11 |
% |
|
|
60,825 |
|
|
|
225 |
|
|
|
1.48 |
% |
Total interest-earning assets |
|
$ |
1,405,722 |
|
|
$ |
13,715 |
|
|
|
3.96 |
% |
|
$ |
1,400,171 |
|
|
$ |
14,725 |
|
|
|
4.18 |
% |
|
$ |
1,285,815 |
|
|
$ |
14,096 |
|
|
|
4.39 |
% |
Allowance for loan losses |
|
|
(14,932 |
) |
|
|
|
|
|
|
|
|
|
|
(18,535 |
) |
|
|
|
|
|
|
|
|
|
|
(15,330 |
) |
|
|
|
|
|
|
|
|
Other assets |
|
|
90,109 |
|
|
|
|
|
|
|
|
|
|
|
87,785 |
|
|
|
|
|
|
|
|
|
|
|
84,461 |
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
1,480,899 |
|
|
|
|
|
|
|
|
|
|
$ |
1,469,421 |
|
|
|
|
|
|
|
|
|
|
$ |
1,354,946 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW, money market, interest checking |
|
$ |
477,159 |
|
|
$ |
380 |
|
|
|
0.32 |
% |
|
$ |
421,969 |
|
|
$ |
383 |
|
|
|
0.36 |
% |
|
$ |
334,740 |
|
|
$ |
774 |
|
|
|
0.92 |
% |
Time deposits |
|
|
442,626 |
|
|
|
1,690 |
|
|
|
1.55 |
% |
|
|
450,193 |
|
|
|
2,099 |
|
|
|
1.85 |
% |
|
|
613,753 |
|
|
|
3,574 |
|
|
|
2.33 |
% |
Total interest-bearing deposits |
|
$ |
919,785 |
|
|
$ |
2,070 |
|
|
|
0.91 |
% |
|
$ |
872,162 |
|
|
$ |
2,482 |
|
|
|
1.13 |
% |
|
$ |
948,493 |
|
|
$ |
4,348 |
|
|
|
1.83 |
% |
Other borrowings |
|
|
51,220 |
|
|
|
48 |
|
|
|
0.38 |
% |
|
|
75,341 |
|
|
|
77 |
|
|
|
0.41 |
% |
|
|
1,259 |
|
|
|
11 |
|
|
|
3.49 |
% |
FHLB advances |
|
|
116,311 |
|
|
|
273 |
|
|
|
0.95 |
% |
|
|
96,191 |
|
|
|
285 |
|
|
|
1.18 |
% |
|
|
56,708 |
|
|
|
233 |
|
|
|
1.65 |
% |
Junior subordinated debentures |
|
|
67,123 |
|
|
|
1,106 |
|
|
|
6.68 |
% |
|
|
67,055 |
|
|
|
1,107 |
|
|
|
6.57 |
% |
|
|
44,871 |
|
|
|
706 |
|
|
|
6.29 |
% |
Total interest-bearing liabilities |
|
$ |
1,154,439 |
|
|
$ |
3,497 |
|
|
|
1.23 |
% |
|
$ |
1,110,749 |
|
|
$ |
3,951 |
|
|
|
1.42 |
% |
|
$ |
1,051,331 |
|
|
$ |
5,297 |
|
|
|
2.02 |
% |
Non-interest-bearing deposits |
|
|
138,814 |
|
|
|
|
|
|
|
|
|
|
|
168,765 |
|
|
|
|
|
|
|
|
|
|
|
113,351 |
|
|
|
|
|
|
|
|
|
Other liabilities |
|
|
15,190 |
|
|
|
|
|
|
|
|
|
|
|
18,758 |
|
|
|
|
|
|
|
|
|
|
|
16,877 |
|
|
|
|
|
|
|
|
|
Total liabilities |
|
$ |
1,308,443 |
|
|
|
|
|
|
|
|
|
|
$ |
1,298,272 |
|
|
|
|
|
|
|
|
|
|
$ |
1,181,559 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity |
|
|
172,456 |
|
|
|
|
|
|
|
|
|
|
|
171,149 |
|
|
|
|
|
|
|
|
|
|
|
173,387 |
|
|
|
|
|
|
|
|
|
Total liabilities and
equity |
|
$ |
1,480,899 |
|
|
|
|
|
|
|
|
|
|
$ |
1,469,421 |
|
|
|
|
|
|
|
|
|
|
$ |
1,354,946 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
|
|
|
$ |
10,218 |
|
|
|
|
|
|
|
|
|
|
$ |
10,774 |
|
|
|
|
|
|
|
|
|
|
$ |
8,799 |
|
|
|
|
|
Interest rate spread (3) |
|
|
|
|
|
|
|
|
|
|
2.73 |
% |
|
|
|
|
|
|
|
|
|
|
2.76 |
% |
|
|
|
|
|
|
|
|
|
|
2.37 |
% |
Net interest margin (4) |
|
|
|
|
|
|
|
|
|
|
2.95 |
% |
|
|
|
|
|
|
|
|
|
|
3.06 |
% |
|
|
|
|
|
|
|
|
|
|
2.74 |
% |
Ratio of interest-earning
assets to interest-bearing liabilities |
|
|
1.22 |
|
|
|
|
|
|
|
|
|
|
|
1.26 |
|
|
|
|
|
|
|
|
|
|
|
1.22 |
|
|
|
|
|
|
|
|
|
(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.
Provision for Loan Losses
- Provision for loan
losses increased by $0.7 million, or 153.2%, to $0.2 million for
the three months ended March 31, 2021, compared to the three months
ended December 31, 2020. The provision for the first quarter is
comprised of $0.1 million related to loan grown and a $0.4 million
net increase in specific impairments related to one agriculture
customer, which was partially offset by a $0.3 million improvement
in economic qualitative factor related to the industries we have
deemed high risk due in the COVID-19 pandemic.
- Year-over-over,
provision for loan losses decreased $2.0 million, or 89.1%,
compared to the three months ended March 31, 2020. The reduction
was primarily the result of the $2.0 million qualitative factor for
industries that were deemed to be high-risk due to the COVID-19
pandemic for the three months ended March 31, 2020, due to the
economic uncertainty at that time. As of March 31, 2021, only $0.5
million of this qualitative factor remained.
Non-Interest Income
- Total non-interest
income for the three months ended March 31, 2021 decreased $0.6
million, or 14.8%, to $3.7 million from the three months ended
December 31, 2020, but increased $1.0 million, or 36.5% from the
three months ended March 31, 2020.
- Loan servicing
fees increased quarter-over-quarter and year-over-year primarily
due a six basis point increase in weighted average servicing fees
and an increase in loans serviced. The average loans serviced on
March 31, 2021 increased by $22.0 million and $77.6 million
compared to December 31, 2020 and March 31, 2020,
respectively.
- Loan
servicing right income for the three months ended March 31, 2021
decreased $0.7 million, or 60.8% to $0.5 million from $1.2 million
for the three months ended December 31, 2020, primarily due to the
pay-down of 20 loans totaling $12.3 million.
- Crop
insurance commission decreased in the sequential quarter by $0.2
million, or 41.8%, due to the annual profit-sharing payment that is
received from insurance companies that was received in the fourth
quarter of 2020.
|
|
For the Three Months Ended |
|
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
Non-Interest Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service charges |
|
$ |
119 |
|
|
$ |
108 |
|
|
$ |
108 |
|
|
$ |
139 |
|
|
$ |
113 |
|
Crop insurance commission |
|
|
301 |
|
|
|
517 |
|
|
|
271 |
|
|
|
229 |
|
|
|
229 |
|
Gain on sale of residential loans, net |
|
|
93 |
|
|
|
219 |
|
|
|
17 |
|
|
|
4 |
|
|
|
38 |
|
Loan servicing fees |
|
|
2,158 |
|
|
|
1,974 |
|
|
|
2,054 |
|
|
|
1,923 |
|
|
|
1,831 |
|
Gain on sale of service-retained loans, net |
|
|
1,587 |
|
|
|
1,828 |
|
|
|
1,268 |
|
|
|
1,041 |
|
|
|
505 |
|
Loan servicing right pay-down losses |
|
|
(1,119 |
) |
|
|
(635 |
) |
|
|
(551 |
) |
|
|
(766 |
) |
|
|
(216 |
) |
Total loan servicing right income |
|
|
468 |
|
|
|
1,193 |
|
|
|
717 |
|
|
|
275 |
|
|
|
289 |
|
Income on OREO |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Gain on sale of securities |
|
|
— |
|
|
|
— |
|
|
|
101 |
|
|
|
570 |
|
|
|
— |
|
Referral fees |
|
|
319 |
|
|
|
64 |
|
|
|
110 |
|
|
|
121 |
|
|
|
17 |
|
Other |
|
|
254 |
|
|
|
283 |
|
|
|
294 |
|
|
|
240 |
|
|
|
203 |
|
Total non-interest income |
|
$ |
3,712 |
|
|
$ |
4,358 |
|
|
$ |
3,672 |
|
|
$ |
3,501 |
|
|
$ |
2,720 |
|
|
|
For the Three Months Ended |
|
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
Loan servicing rights, end of period |
|
$ |
18,864 |
|
|
$ |
18,396 |
|
|
$ |
17,203 |
|
|
$ |
16,486 |
|
|
$ |
16,211 |
|
Loans serviced, end of
period |
|
|
841,893 |
|
|
|
812,560 |
|
|
|
797,819 |
|
|
|
762,058 |
|
|
|
747,553 |
|
Loan servicing rights as a %
of loans serviced |
|
|
2.24 |
% |
|
|
2.26 |
% |
|
|
2.16 |
% |
|
|
2.16 |
% |
|
|
2.17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loan servicing fees |
|
$ |
2,158 |
|
|
$ |
1,974 |
|
|
$ |
2,054 |
|
|
$ |
1,923 |
|
|
$ |
1,831 |
|
Average loans serviced |
|
|
827,227 |
|
|
|
805,190 |
|
|
|
779,939 |
|
|
|
754,806 |
|
|
|
749,646 |
|
Annualized loan servicing fees
as a % of average loans serviced |
|
|
1.04 |
% |
|
|
0.98 |
% |
|
|
1.05 |
% |
|
|
1.02 |
% |
|
|
0.98 |
% |
Non-Interest Expense
- Total non-interest
expense for the three months ended March 31, 2021 decreased $0.7
million, or 13.1%, to $8.8 million from the three months ended
December 31, 2020, and decreased $6.3 million, or 41.6% from the
three months ended March 31, 2020.
- Employee
compensation and benefits expense decreased for the three months
ended March 31, 2021 by $1.1 million to $5.6 million compared to
the three months ended December 31, 2020. The change was primarily
the result of an additional accrual of $1.6 million that took place
during the fourth quarter of 2020 for incentive compensation
related to 2020 financial results, which was partially offset by
2021 merit increases and payroll taxes that reset at the beginning
of each year.
-
Professional fees increased during the first quarter of 2021 by
$0.2 million, or 37.8%, to $0.8 million compared to the fourth
quarter of 2020 due primarily to a nonrecurring technology strategy
project.
|
|
For the Three Months Ended |
|
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Non-Interest Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation and benefits |
|
$ |
5,582 |
|
|
$ |
6,687 |
|
|
$ |
4,766 |
|
|
$ |
4,594 |
|
|
$ |
5,260 |
|
Occupancy |
|
|
279 |
|
|
|
297 |
|
|
|
321 |
|
|
|
305 |
|
|
|
354 |
|
Information processing |
|
|
661 |
|
|
|
656 |
|
|
|
641 |
|
|
|
663 |
|
|
|
670 |
|
Professional fees |
|
|
802 |
|
|
|
582 |
|
|
|
555 |
|
|
|
480 |
|
|
|
401 |
|
Business development |
|
|
307 |
|
|
|
136 |
|
|
|
305 |
|
|
|
333 |
|
|
|
366 |
|
OREO expenses |
|
|
23 |
|
|
|
20 |
|
|
|
47 |
|
|
|
44 |
|
|
|
116 |
|
Writedown of OREO |
|
|
— |
|
|
|
148 |
|
|
|
— |
|
|
|
— |
|
|
|
1,360 |
|
Net loss (gain) on sale of
OREO |
|
|
17 |
|
|
|
(326 |
) |
|
|
9 |
|
|
|
— |
|
|
|
4 |
|
Depreciation and
amortization |
|
|
257 |
|
|
|
289 |
|
|
|
295 |
|
|
|
303 |
|
|
|
301 |
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,038 |
|
Other |
|
|
836 |
|
|
|
1,005 |
|
|
|
728 |
|
|
|
743 |
|
|
|
1,148 |
|
Total non-interest expense |
|
$ |
8,764 |
|
|
$ |
9,494 |
|
|
$ |
7,667 |
|
|
$ |
7,465 |
|
|
$ |
15,018 |
|
Asset Quality
- During the first
quarter of 2021, watch rated loans decreased by $24.3 million, or
12.8%, and $53.6 million, or 24.4%, compared to December 31, 2020
and March 31, 2020, respectively, primarily as the result of eight
dairy customers upgraded to a low satisfactory rating. This
improvement in asset quality is expected to continue in the second
quarter of 2021 as we complete the annual review process.
- Special mention
loans decreased $1.9 million, or 75.5%, compared to December 31,
2020 due mainly to the migration of one agricultural customer to
substandard performing.
- Substandard
performing loans decreased by $1.5 million, or 3.6%, to $39.0
million at March 31, 2021 compared to December 31, 2020 due to
impairment of two customer relationships; one customer filed for
bankruptcy, and one customer on a workout plan was more than 90
days past due at quarter end. These two migrations to substandard
impaired were offset in part by the special mention migration
discussed above.
The following table presents loan balances by
credit grade for the periods indicated:
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
Loans by risk category: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sound/Acceptable/Satisfactory/ Low Satisfactory |
|
$ |
757,160 |
|
|
$ |
716,313 |
|
|
$ |
800,451 |
|
|
$ |
798,945 |
|
|
$ |
706,247 |
|
Watch |
|
|
165,823 |
|
|
|
190,101 |
|
|
|
185,254 |
|
|
|
198,044 |
|
|
|
219,459 |
|
Special Mention |
|
|
605 |
|
|
|
2,501 |
|
|
|
1,851 |
|
|
|
1,856 |
|
|
|
15,036 |
|
Substandard Performing |
|
|
38,961 |
|
|
|
40,420 |
|
|
|
41,577 |
|
|
|
47,741 |
|
|
|
34,179 |
|
Substandard Impaired |
|
|
49,115 |
|
|
|
46,950 |
|
|
|
46,793 |
|
|
|
40,938 |
|
|
|
37,515 |
|
Total loans |
|
$ |
1,011,664 |
|
|
$ |
996,285 |
|
|
$ |
1,075,926 |
|
|
$ |
1,087,524 |
|
|
$ |
1,012,436 |
|
Adverse classified asset ratio
(1) |
|
|
39.61 |
% |
|
|
39.43 |
% |
|
|
42.64 |
% |
|
|
41.73 |
% |
|
|
32.35 |
% |
(1) 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 first quarter by $2.0
million, or 4.7%, compared to the fourth quarter of 2020 due to two
agricultural customers being placed on non-accrual status. It is
anticipated that during the second quarter of 2021, approximately
$7.0 million of agricultural loans will be restored to accrual
status as a result of the completion of the annual credit review of
the dairy portfolio.
-
Non-accrual loans increased $2.3 million, or 5.6%, as of March 31,
2021 compared to December 31, 2020, due to the previously discussed
customer bankruptcy.
-
Performing TDRs not on non-accrual decreased $5.1 million, or
27.4%, to $13.5 million on March 31, 2021 from December 31, 2020.
The decrease is primarily due to one agriculture customer that was
re-underwritten and was no longer a TDR due to improved performance
and financial trends.
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
Non-Performing Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual loans |
|
$ |
43,973 |
|
|
$ |
41,624 |
|
|
$ |
41,351 |
|
|
$ |
35,456 |
|
|
$ |
32,051 |
|
Other real estate owned |
|
|
739 |
|
|
|
1,077 |
|
|
|
3,064 |
|
|
|
2,629 |
|
|
|
3,247 |
|
Total non-performing assets |
|
$ |
44,712 |
|
|
$ |
42,701 |
|
|
$ |
44,415 |
|
|
$ |
38,085 |
|
|
$ |
35,298 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing TDRs not on nonaccrual |
|
$ |
13,495 |
|
|
$ |
18,592 |
|
|
$ |
19,036 |
|
|
$ |
21,986 |
|
|
$ |
21,853 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-performing assets as a %
of total loans |
|
|
4.42 |
% |
|
|
4.29 |
% |
|
|
4.13 |
% |
|
|
3.50 |
% |
|
|
3.49 |
% |
Non-performing assets as a %
of total assets |
|
|
3.00 |
% |
|
|
2.90 |
% |
|
|
2.98 |
% |
|
|
2.52 |
% |
|
|
2.61 |
% |
Allowance for loan losses as a
% of total loans |
|
|
1.49 |
% |
|
|
1.49 |
% |
|
|
1.73 |
% |
|
|
1.71 |
% |
|
|
1.73 |
% |
Net charge-offs (recoveries)
quarter- to-date |
|
$ |
(32 |
) |
|
$ |
3,386 |
|
|
$ |
(1 |
) |
|
$ |
120 |
|
|
$ |
(62 |
) |
Conference Call
The Company will host an earnings call tomorrow,
April 23, 2021, at 8:30 a.m., CDT, conducted by Timothy J.
Schneider, President; Glen L. Stiteley, Chief Financial Officer;
David C. Coggins, Chief Banking Officer; John R. Fillingim, Chief
Credit Officer; and Matthew R. Lemke, Chief Retail and Deposit
Officer. 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 April 23, 2022, 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) |
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Period-End Balance Sheet: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
17,820 |
|
|
$ |
19,500 |
|
|
$ |
53,283 |
|
|
$ |
127,432 |
|
|
$ |
21,545 |
|
Securities available-for-sale, at fair value |
|
|
385,240 |
|
|
|
352,854 |
|
|
|
298,476 |
|
|
|
226,971 |
|
|
|
246,148 |
|
Loans held for sale |
|
|
5,789 |
|
|
|
35,976 |
|
|
|
2,593 |
|
|
|
11,847 |
|
|
|
14,388 |
|
Agricultural loans |
|
|
609,482 |
|
|
|
606,881 |
|
|
|
619,617 |
|
|
|
624,340 |
|
|
|
642,066 |
|
Commercial loans |
|
|
317,625 |
|
|
|
313,265 |
|
|
|
317,782 |
|
|
|
328,368 |
|
|
|
325,310 |
|
Paycheck Protection Plan loans |
|
|
46,249 |
|
|
|
37,790 |
|
|
|
98,421 |
|
|
|
103,317 |
|
|
|
— |
|
Multi-family real estate loans |
|
|
33,287 |
|
|
|
33,457 |
|
|
|
35,496 |
|
|
|
30,439 |
|
|
|
42,198 |
|
Residential real estate loans |
|
|
4,776 |
|
|
|
4,627 |
|
|
|
4,489 |
|
|
|
975 |
|
|
|
2,753 |
|
Installment and consumer other |
|
|
245 |
|
|
|
265 |
|
|
|
121 |
|
|
|
85 |
|
|
|
109 |
|
Total loans |
|
|
1,011,664 |
|
|
|
996,285 |
|
|
|
1,075,926 |
|
|
|
1,087,524 |
|
|
|
1,012,436 |
|
Allowance for loan losses |
|
|
(15,082 |
) |
|
|
(14,808 |
) |
|
|
(18,649 |
) |
|
|
(18,569 |
) |
|
|
(17,547 |
) |
Net loans |
|
|
996,582 |
|
|
|
981,477 |
|
|
|
1,057,277 |
|
|
|
1,068,955 |
|
|
|
994,889 |
|
Other assets |
|
|
85,897 |
|
|
|
82,551 |
|
|
|
80,426 |
|
|
|
78,712 |
|
|
|
78,004 |
|
Total
Assets |
|
$ |
1,491,328 |
|
|
$ |
1,472,358 |
|
|
$ |
1,492,055 |
|
|
$ |
1,513,917 |
|
|
$ |
1,354,974 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
$ |
139,838 |
|
|
$ |
163,202 |
|
|
$ |
158,798 |
|
|
$ |
149,963 |
|
|
$ |
117,434 |
|
NOW accounts and interest checking |
|
|
95,591 |
|
|
|
96,624 |
|
|
|
78,026 |
|
|
|
81,656 |
|
|
|
64,873 |
|
Savings |
|
|
8,431 |
|
|
|
7,367 |
|
|
|
11,900 |
|
|
|
8,369 |
|
|
|
6,566 |
|
Money market accounts |
|
|
390,741 |
|
|
|
344,250 |
|
|
|
325,900 |
|
|
|
307,083 |
|
|
|
237,889 |
|
Time deposits |
|
|
278,591 |
|
|
|
304,580 |
|
|
|
322,992 |
|
|
|
346,482 |
|
|
|
364,930 |
|
Brokered deposits |
|
|
159,034 |
|
|
|
80,456 |
|
|
|
101,808 |
|
|
|
121,503 |
|
|
|
161,882 |
|
National time deposits |
|
|
26,302 |
|
|
|
44,347 |
|
|
|
50,747 |
|
|
|
57,997 |
|
|
|
66,386 |
|
Total deposits |
|
|
1,098,528 |
|
|
|
1,040,826 |
|
|
|
1,050,171 |
|
|
|
1,073,053 |
|
|
|
1,019,960 |
|
Federal Reserve Discount Window advances |
|
|
47,255 |
|
|
|
47,531 |
|
|
|
99,693 |
|
|
|
99,693 |
|
|
|
— |
|
FHLB advances |
|
|
100,000 |
|
|
|
129,000 |
|
|
|
84,600 |
|
|
|
93,400 |
|
|
|
109,400 |
|
Subordinated debentures |
|
|
67,179 |
|
|
|
67,111 |
|
|
|
67,025 |
|
|
|
61,910 |
|
|
|
44,896 |
|
Other liabilities |
|
|
12,028 |
|
|
|
16,114 |
|
|
|
20,656 |
|
|
|
17,336 |
|
|
|
15,672 |
|
Total
Liabilities |
|
|
1,324,990 |
|
|
|
1,300,582 |
|
|
|
1,322,145 |
|
|
|
1,345,392 |
|
|
|
1,189,928 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
166,338 |
|
|
|
171,776 |
|
|
|
169,910 |
|
|
|
168,525 |
|
|
|
165,046 |
|
Total Liabilities and Shareholders'
Equity |
|
$ |
1,491,328 |
|
|
$ |
1,472,358 |
|
|
$ |
1,492,055 |
|
|
$ |
1,513,917 |
|
|
$ |
1,354,974 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Price
Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
High - Quarter-to-date |
|
$ |
26.46 |
|
|
$ |
23.72 |
|
|
$ |
22.00 |
|
|
$ |
24.67 |
|
|
$ |
27.19 |
|
Low - Quarter-to-date |
|
$ |
19.66 |
|
|
$ |
18.20 |
|
|
$ |
17.04 |
|
|
$ |
17.13 |
|
|
$ |
13.55 |
|
Market price - Quarter-end |
|
$ |
23.97 |
|
|
$ |
22.08 |
|
|
$ |
18.80 |
|
|
$ |
20.93 |
|
|
$ |
18.50 |
|
Book value per share |
|
$ |
25.99 |
|
|
$ |
26.42 |
|
|
$ |
25.72 |
|
|
$ |
25.18 |
|
|
$ |
24.17 |
|
Tangible book value per share (1) |
|
$ |
25.98 |
|
|
$ |
26.42 |
|
|
$ |
25.71 |
|
|
$ |
25.16 |
|
|
$ |
24.15 |
|
Common shares outstanding |
|
|
6,094,450 |
|
|
|
6,197,965 |
|
|
|
6,294,675 |
|
|
|
6,375,150 |
|
|
|
6,496,790 |
|
(1) This is a non-GAAP financial measure. A reconciliation
to GAAP is included below.
|
|
For the Three Months Ended |
|
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Selected Income Statement Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and Dividend
Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, including fees |
|
$ |
11,523 |
|
|
$ |
12,737 |
|
|
$ |
11,594 |
|
|
$ |
12,009 |
|
|
$ |
12,565 |
|
Taxable securities |
|
|
1,887 |
|
|
|
1,777 |
|
|
|
1,293 |
|
|
|
1,283 |
|
|
|
1,282 |
|
Tax-exempt securities |
|
|
246 |
|
|
|
201 |
|
|
|
167 |
|
|
|
162 |
|
|
|
6 |
|
Federal funds sold and other |
|
|
58 |
|
|
|
10 |
|
|
|
52 |
|
|
|
111 |
|
|
|
225 |
|
Total interest and dividend
income |
|
|
13,714 |
|
|
|
14,725 |
|
|
|
13,106 |
|
|
|
13,565 |
|
|
|
14,078 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
2,069 |
|
|
|
2,482 |
|
|
|
2,914 |
|
|
|
3,721 |
|
|
|
4,347 |
|
FHLB advances and other borrowed funds |
|
|
321 |
|
|
|
362 |
|
|
|
456 |
|
|
|
343 |
|
|
|
244 |
|
Subordinated debentures |
|
|
1,106 |
|
|
|
1,107 |
|
|
|
1,082 |
|
|
|
736 |
|
|
|
706 |
|
Total interest expense |
|
|
3,496 |
|
|
|
3,951 |
|
|
|
4,452 |
|
|
|
4,800 |
|
|
|
5,297 |
|
Net interest income |
|
|
10,218 |
|
|
|
10,774 |
|
|
|
8,654 |
|
|
|
8,765 |
|
|
|
8,781 |
|
Provision for loan losses |
|
|
242 |
|
|
|
(455 |
) |
|
|
79 |
|
|
|
1,142 |
|
|
|
2,218 |
|
Net interest income after provision for loan losses |
|
|
9,976 |
|
|
|
11,229 |
|
|
|
8,575 |
|
|
|
7,623 |
|
|
|
6,563 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest
Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services charges |
|
|
119 |
|
|
|
108 |
|
|
|
108 |
|
|
|
139 |
|
|
|
113 |
|
Crop insurance commission |
|
|
301 |
|
|
|
517 |
|
|
|
271 |
|
|
|
229 |
|
|
|
229 |
|
Gain on sale of residential loans, net |
|
|
93 |
|
|
|
219 |
|
|
|
17 |
|
|
|
4 |
|
|
|
38 |
|
Loan servicing fees |
|
|
2,158 |
|
|
|
1,974 |
|
|
|
2,054 |
|
|
|
1,923 |
|
|
|
1,831 |
|
Gain on sale of service-retained loans, net |
|
|
1,587 |
|
|
|
1,828 |
|
|
|
1,268 |
|
|
|
1,041 |
|
|
|
505 |
|
Loan servicing right pay-down losses |
|
|
(1,119 |
) |
|
|
(635 |
) |
|
|
(551 |
) |
|
|
(766 |
) |
|
|
(216 |
) |
Total loan servicing right income |
|
|
468 |
|
|
|
1,193 |
|
|
|
717 |
|
|
|
275 |
|
|
|
289 |
|
Gain on sale of securities |
|
|
— |
|
|
|
— |
|
|
|
101 |
|
|
|
570 |
|
|
|
— |
|
Referral fees (1) |
|
|
319 |
|
|
|
64 |
|
|
|
110 |
|
|
|
121 |
|
|
|
17 |
|
Other |
|
|
254 |
|
|
|
283 |
|
|
|
294 |
|
|
|
240 |
|
|
|
203 |
|
Total non-interest income |
|
|
3,712 |
|
|
|
4,358 |
|
|
|
3,672 |
|
|
|
3,501 |
|
|
|
2,720 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest
Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation and benefits |
|
|
5,582 |
|
|
|
6,687 |
|
|
|
4,766 |
|
|
|
4,594 |
|
|
|
5,260 |
|
Occupancy |
|
|
279 |
|
|
|
297 |
|
|
|
321 |
|
|
|
305 |
|
|
|
354 |
|
Information processing |
|
|
661 |
|
|
|
656 |
|
|
|
641 |
|
|
|
663 |
|
|
|
670 |
|
Professional fees |
|
|
802 |
|
|
|
582 |
|
|
|
555 |
|
|
|
480 |
|
|
|
401 |
|
Business development |
|
|
307 |
|
|
|
136 |
|
|
|
305 |
|
|
|
333 |
|
|
|
366 |
|
OREO expenses |
|
|
23 |
|
|
|
20 |
|
|
|
47 |
|
|
|
44 |
|
|
|
116 |
|
Writedown of OREO |
|
|
— |
|
|
|
148 |
|
|
|
— |
|
|
|
— |
|
|
|
1,360 |
|
Net loss (gain) on sale of OREO |
|
|
17 |
|
|
|
(326 |
) |
|
|
9 |
|
|
|
— |
|
|
|
4 |
|
Depreciation and amortization |
|
|
257 |
|
|
|
289 |
|
|
|
295 |
|
|
|
303 |
|
|
|
301 |
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,038 |
|
Other |
|
|
836 |
|
|
|
1,005 |
|
|
|
728 |
|
|
|
743 |
|
|
|
1,148 |
|
Total non-interest expense |
|
|
8,764 |
|
|
|
9,494 |
|
|
|
7,667 |
|
|
|
7,465 |
|
|
|
15,018 |
|
Income (loss) before income
taxes |
|
|
4,924 |
|
|
|
6,093 |
|
|
|
4,580 |
|
|
|
3,659 |
|
|
|
(5,735 |
) |
Income tax expense (benefit) |
|
|
996 |
|
|
|
1,575 |
|
|
|
1,164 |
|
|
|
926 |
|
|
|
(547 |
) |
NET INCOME
(LOSS) |
|
$ |
3,928 |
|
|
$ |
4,518 |
|
|
$ |
3,416 |
|
|
$ |
2,733 |
|
|
$ |
(5,188 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per
share |
|
$ |
0.62 |
|
|
$ |
0.70 |
|
|
$ |
0.52 |
|
|
$ |
0.40 |
|
|
$ |
(0.79 |
) |
Diluted earnings (loss) per
share |
|
$ |
0.62 |
|
|
$ |
0.70 |
|
|
$ |
0.52 |
|
|
$ |
0.40 |
|
|
$ |
(0.78 |
) |
Dividends declared per
share |
|
$ |
0.10 |
|
|
$ |
0.10 |
|
|
$ |
0.07 |
|
|
$ |
0.07 |
|
|
$ |
0.07 |
|
(1) Referral fees in prior quarters reclassed to non-interest
income to match current classification
|
|
For the Three Months Ended |
|
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands, except share data) |
|
Other Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets (1) |
|
|
1.06 |
% |
|
|
1.23 |
% |
|
|
0.91 |
% |
|
|
0.74 |
% |
|
|
(1.53 |
)% |
Return on average shareholders' equity (1) |
|
|
9.11 |
% |
|
|
10.56 |
% |
|
|
8.05 |
% |
|
|
6.55 |
% |
|
|
(11.97 |
)% |
Return on average common shareholders' equity (1)(2) |
|
|
9.29 |
% |
|
|
10.88 |
% |
|
|
8.25 |
% |
|
|
6.63 |
% |
|
|
(12.81 |
)% |
Efficiency ratio (1)(2) |
|
|
62.79 |
% |
|
|
63.92 |
% |
|
|
62.64 |
% |
|
|
11.13 |
% |
|
|
74.92 |
% |
Equity to assets ratio |
|
|
11.15 |
% |
|
|
11.67 |
% |
|
|
11.39 |
% |
|
|
11.13 |
% |
|
|
12.18 |
% |
Tangible common equity to tangible assets (2) |
|
|
10.62 |
% |
|
|
11.12 |
% |
|
|
10.85 |
% |
|
|
10.60 |
% |
|
|
11.58 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Share
Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations |
|
$ |
3,928 |
|
|
$ |
4,518 |
|
|
$ |
3,416 |
|
|
$ |
2,733 |
|
|
$ |
(5,188 |
) |
Less: Preferred stock dividends |
|
|
81 |
|
|
|
80 |
|
|
|
80 |
|
|
|
99 |
|
|
|
108 |
|
Income available to common shareholders |
|
$ |
3,847 |
|
|
$ |
4,438 |
|
|
$ |
3,336 |
|
|
$ |
2,634 |
|
|
$ |
(5,296 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares issued |
|
|
7,218,358 |
|
|
|
7,206,238 |
|
|
|
7,202,000 |
|
|
|
7,198,901 |
|
|
|
7,182,945 |
|
Less: Weighted average treasury shares |
|
|
1,080,089 |
|
|
|
957,573 |
|
|
|
882,153 |
|
|
|
759,294 |
|
|
|
518,740 |
|
Plus: Weighted average non-vested restricted stock units |
|
|
63,991 |
|
|
|
67,529 |
|
|
|
66,492 |
|
|
|
65,291 |
|
|
|
39,785 |
|
Weighted average number of common shares outstanding |
|
|
6,202,260 |
|
|
|
6,316,194 |
|
|
|
6,386,339 |
|
|
|
6,504,898 |
|
|
|
6,703,990 |
|
Effect of dilutive options |
|
|
34,465 |
|
|
|
28,025 |
|
|
|
20,915 |
|
|
|
28,511 |
|
|
|
49,072 |
|
Weighted average number of common shares outstanding used to
calculate diluted earnings per common share |
|
|
6,236,725 |
|
|
|
6,344,219 |
|
|
|
6,407,254 |
|
|
|
6,533,409 |
|
|
|
6,753,062 |
|
(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 |
|
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands) |
|
Return on average common shareholders'
equity reconciliation
(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average shareholders' equity |
|
|
9.11 |
% |
|
|
10.56 |
% |
|
|
8.05 |
% |
|
|
6.55 |
% |
|
|
(11.97 |
)% |
Effect of excluding average preferred shareholders' equity |
|
|
0.18 |
% |
|
|
0.32 |
% |
|
|
0.20 |
% |
|
|
0.08 |
% |
|
|
(0.84 |
)% |
Return on average common shareholders' equity |
|
|
9.29 |
% |
|
|
10.88 |
% |
|
|
8.25 |
% |
|
|
6.63 |
% |
|
|
(12.81 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency
ratio (2): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest expense |
|
$ |
8,764 |
|
|
$ |
9,494 |
|
|
$ |
7,667 |
|
|
$ |
7,465 |
|
|
$ |
15,018 |
|
Less: goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5,038 |
) |
Less: historical tax credit investment impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Less: net loss on sales and write-downs of OREO |
|
|
(17 |
) |
|
|
178 |
|
|
|
(9 |
) |
|
|
— |
|
|
|
(1,364 |
) |
Adjusted non-interest expense (non-GAAP) |
|
$ |
8,747 |
|
|
$ |
9,672 |
|
|
$ |
7,658 |
|
|
$ |
7,465 |
|
|
$ |
8,616 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
10,218 |
|
|
$ |
10,774 |
|
|
$ |
8,654 |
|
|
$ |
8,765 |
|
|
$ |
8,781 |
|
Non-interest income |
|
|
3,712 |
|
|
|
4,358 |
|
|
|
3,672 |
|
|
|
3,501 |
|
|
|
2,720 |
|
Less: net gain on sales of securities |
|
|
— |
|
|
|
— |
|
|
|
(101 |
) |
|
|
(570 |
) |
|
|
— |
|
Operating revenue |
|
$ |
13,930 |
|
|
$ |
15,132 |
|
|
$ |
12,225 |
|
|
$ |
11,696 |
|
|
$ |
11,501 |
|
Efficiency ratio |
|
|
62.79 |
% |
|
|
63.92 |
% |
|
|
62.64 |
% |
|
|
63.83 |
% |
|
|
74.92 |
% |
|
|
For the Three Months Ended |
|
|
|
March 31,2021 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Adjusted diluted earnings per
share(3): |
|
|
|
|
|
|
|
|
Net income from continuing operations |
|
$ |
3,928 |
|
|
$ |
(5,188 |
) |
Less: preferred stock dividends |
|
|
(81 |
) |
|
|
(108 |
) |
Plus: goodwill impairment |
|
|
— |
|
|
|
5,038 |
|
Adjusted income available to common shareholders for basic earnings
per common share |
|
$ |
3,847 |
|
|
$ |
(258 |
) |
Weighted average number of common shares outstanding |
|
|
6,202,260 |
|
|
|
6,703,990 |
|
Effect of dilutive options |
|
|
34,465 |
|
|
|
49,072 |
|
Weighted average number of common shares outstanding used to
calculate diluted earnings per common share |
|
|
6,236,725 |
|
|
|
6,753,062 |
|
Adjusted diluted earnings per
share |
|
$ |
0.62 |
|
|
$ |
(0.04 |
) |
(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):
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
September 30,2020 |
|
|
June 30,2020 |
|
|
March 31,2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in thousands, except per share data) |
|
Tangible book value per share and tangible
common equity to tangible assets
reconciliation (1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity |
|
$ |
158,338 |
|
|
$ |
163,776 |
|
|
$ |
161,910 |
|
|
$ |
160,525 |
|
|
$ |
157,046 |
|
Less: Core deposit intangible, net of amortization |
|
|
29 |
|
|
|
54 |
|
|
|
86 |
|
|
|
125 |
|
|
|
171 |
|
Tangible common equity (non-GAAP) |
|
$ |
158,309 |
|
|
$ |
163,722 |
|
|
$ |
161,824 |
|
|
$ |
160,400 |
|
|
$ |
156,875 |
|
Common shares outstanding |
|
|
6,094,450 |
|
|
|
6,197,965 |
|
|
|
6,294,675 |
|
|
|
6,375,150 |
|
|
|
6,496,790 |
|
Tangible book value per share |
|
$ |
25.98 |
|
|
$ |
26.42 |
|
|
$ |
25.71 |
|
|
$ |
25.16 |
|
|
$ |
24.15 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
1,491,328 |
|
|
$ |
1,472,358 |
|
|
$ |
1,492,055 |
|
|
$ |
1,513,917 |
|
|
$ |
1,354,974 |
|
Less: Core deposit intangible, net of amortization |
|
|
29 |
|
|
|
54 |
|
|
|
86 |
|
|
|
125 |
|
|
|
171 |
|
Tangible assets (non-GAAP) |
|
$ |
1,491,299 |
|
|
$ |
1,472,304 |
|
|
$ |
1,491,969 |
|
|
$ |
1,513,792 |
|
|
$ |
1,354,803 |
|
Tangible common equity to tangible assets |
|
|
10.62 |
% |
|
|
11.12 |
% |
|
|
10.85 |
% |
|
|
10.60 |
% |
|
|
11.58 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adverse classified
asset ratio (2): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Substandard loans |
|
$ |
88,076 |
|
|
$ |
87,370 |
|
|
$ |
88,370 |
|
|
$ |
88,680 |
|
|
$ |
71,694 |
|
Other real estate owned |
|
|
739 |
|
|
|
1,077 |
|
|
|
3,064 |
|
|
|
2,629 |
|
|
|
3,247 |
|
Substandard unused commitments |
|
|
5,091 |
|
|
|
4,049 |
|
|
|
5,124 |
|
|
|
3,230 |
|
|
|
2,840 |
|
Less: Substandard government guarantees |
|
|
(8,485 |
) |
|
|
(8,960 |
) |
|
|
(7,002 |
) |
|
|
(6,336 |
) |
|
|
(7,699 |
) |
Total adverse classified assets (non-GAAP) |
|
$ |
85,421 |
|
|
$ |
83,536 |
|
|
$ |
89,556 |
|
|
$ |
88,203 |
|
|
$ |
70,082 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity (Bank) |
|
$ |
202,200 |
|
|
$ |
205,743 |
|
|
$ |
200,011 |
|
|
$ |
201,507 |
|
|
$ |
204,089 |
|
Accumulated other comprehensive gain on available for sale
securities |
|
|
(1,652 |
) |
|
|
(8,686 |
) |
|
|
(8,640 |
) |
|
|
(8,734 |
) |
|
|
(5,012 |
) |
Allowance for loan losses |
|
|
15,082 |
|
|
|
14,808 |
|
|
|
18,649 |
|
|
|
18,569 |
|
|
|
17,547 |
|
Adjusted total equity (non-GAAP) |
|
$ |
215,630 |
|
|
$ |
211,865 |
|
|
$ |
210,020 |
|
|
$ |
211,342 |
|
|
$ |
216,624 |
|
Adverse classified asset ratio |
|
|
39.61 |
% |
|
|
39.43 |
% |
|
|
42.64 |
% |
|
|
41.73 |
% |
|
|
32.35 |
% |
(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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