SBBX SB One Bancorp

SB One Bancorp (the “Company”) (Nasdaq: SBBX), the holding company for SB One Bank (the “Bank”), today reported net income of $5.3 million, or $0.57 per basic and diluted share, for the quarter ended December 31, 2019, an increase of 126.6%, as compared to net income of $2.4 million, or $0.29 per basic and diluted share, for the quarter ended December 31, 2018. The increase in net income for the quarter ended December 31, 2019 was driven by a $3.6 million, or 31.9%, increase in net interest income attributable to average loan and deposit growth and the merger with Enterprise Bank NJ (“Enterprise”), and a $724 thousand increase in non-interest income as compared to the same period last year. The increase in net income was partially offset by a $71 thousand, or 0.7%, increase in non-interest expense.  

The Company reported net income of $22.5 million, or $2.41 per basic share and $2.40 per diluted share, for the year ended December 31, 2019, an increase of 127.2%, as compared to $9.9 million, or $1.26 per basic share and $1.25 per diluted share, for the year ended December 31, 2018. For the year ended December 31, 2019, net income growth was driven by an increase in net interest income of $15.0 million, or 34.0%, resulting from growth of $24.2 million in loan interest income which was attributable to average loan growth and the merger with Enterprise. In addition, non-interest income increased $3.6 million, or 33.5%, as compared to the year ended December 31, 2018 due to a $1.4 million increase in insurance commissions and fees and a $2.0 million increase in gain on security transactions. The increase in net income was partially offset by an increase in non-interest expense of $825 thousand, or 2.0%.

The Company reported net income of $5.3 million, or $0.57 per basic and diluted share, for the quarter ended December 31, 2019, an increase of 3.6%, as compared to net income of $5.1 million, or $0.55 per basic and diluted share, for the quarter ended September 30, 2019.  The increase in net income for the quarter ended December 31, 2019 was driven by a $261 thousand, or 1.8%, increase in net interest income and a $114 thousand increase in non-interest income as compared to the quarter ended September 30, 2019.  The increase in net interest income was driven by average loan growth of $43.6 million quarter over quarter. The increase in net income was partially offset by a $157 thousand, or 1.5%, increase in non-interest expense. 

Anthony Labozzetta, President and CEO of SB One Bancorp and SB One Bank stated, “Many would consider the operating environment for banks in 2019 to be very challenging. With that in mind, I am extremely proud of our team’s extraordinary accomplishments this year, which resulted in record earnings and strong momentum leading into 2020.  We ended the fourth quarter strong and I am happy to share the following achievements:  We crossed the $2 Billion asset threshold; our commercial loans and retail deposits grew at an impressive annualized growth rate of 22% and 12%, respectively; we expanded our core net interest margin approximately 7 basis points; and, our insurance company had double digit growth in commission income over the prior year”, stated Mr. Labozzetta. 

Mr. Labozzetta also stated, “to continue our strong performance we must wisely invest in our bank and build for the future while maintaining positive operating leverage. To that end, we look forward to 2020”.

Declaration of Quarterly DividendOn January 29, 2020, the Company’s Board of Directors declared a quarterly cash dividend of $0.085 per share, which is payable on February 25, 2020 to common shareholders of record as of the close of business on February 11, 2019.

Financial PerformanceNet Income. For the quarter ended December 31, 2019, the Company reported net income of $5.3 million, or $0.57 per basic and diluted share, an increase of 126.6%, as compared to net income of $2.4 million, or $0.29 per basic and diluted share, for the quarter ended December 31, 2018.

The increase in net income for the quarter ended December 31, 2019 was driven by a $3.6 million, or 31.9%, increase in net interest income resulting from loan and deposit growth, the Enterprise merger, and a $724 thousand increase in non-interest income mainly due to a $531 thousand increase in gain on security transactions and $156 thousand increase in insurance commissions and fees. Non-interest expenses increased $71 thousand to $10.3 million for the fourth quarter of 2019 as compared to the fourth quarter of 2018. The increase in non-interest expenses was primarily attributable to an increase in salaries and employee benefits of $1.0 million resulting from the merger with Enterprise and the continued growth of the Company. In addition, professional fees increased $171 thousand and data processing expenses increased $142 thousand. The increase in non-interest expenses was partially offset by a decrease in merger related expenses of $1.5 million as compared to the same quarter of 2018.

For the year ended December 31, 2019, the Company reported net income of $22.5 million, or $2.41 per basic share and $2.40 per diluted share, an increase of 127.2%, as compared to net income of $9.9 million, or $1.26 per basic share and $1.25 per diluted share, for the year ended December 31, 2018. 

Net Interest Income.  Net interest income on a fully tax equivalent basis increased $3.4 million, or 29.7%, to $15.0 million for the fourth quarter of 2019, as compared to $11.6 million for the same period in 2018.  The increase in net interest income was largely due to a $406.0 million, or 28.4%, increase in average interest earning assets, principally loans receivable, which increased $366.2 million, or 29.9%, led by organic growth and the December 2018 closing of the Enterprise merger. In addition, the growth in net interest income was due to an increase in purchase accounting accretion, related to the Enterprise and Community mergers, of $287 thousand ($214 thousand due to loans) to $700 thousand ($526 thousand related to loans) for the fourth quarter of 2019, as compared to $413 thousand for the same period in 2018.The net interest margin increased 2 basis points to 3.24% for the fourth quarter of 2019, as compared to the same period in 2018, as a result of an increase in yield on earning assets of 19 basis points driven by an increase in yields on loans receivable of 29 basis points. The increase in the Company’s yield on interest earning assets was offset by an increase in cost of funds of 17 basis points mainly due to an increase in rates on deposits.  

Net interest income on a fully tax equivalent basis increased $14.6 million, or 32.5%, to $59.6 million for the year ended December 31, 2019 as compared to $45.0 million for the year ended December 31, 2018.  The increase in net interest income was largely due to a $437.2 million, or 32.7%, increase in average interest earning assets, principally loans receivable, which increased $400.6 million, or 35.2%, driven by organic growth and the Enterprise merger. In addition, the increase in net interest income was due to an increase in purchase accounting accretion, related to the Enterprise and Community mergers, of $2.3 million ($1.8 million due to Loans) to $3.9 million ($3.0 million related to Loans) for the year ended 2019, as compared to $1.6 million in 2018.

Provision for Loan Losses. Provision for loan losses increased $338 thousand, or 161.0%, to $548 thousand for the fourth quarter of 2019, as compared to $210 thousand for the same period in 2018.

Provision for loan losses increased $1.1 million, or 76.1%, to $2.5 million for the year ended December 31, 2019, as compared to $1.4 million for the year ended December 31, 2018.

Non-interest Income. Non-interest income increased $724 thousand, or 29.0%, to $3.2 million for the fourth quarter of 2019, as compared to the same period in 2018.  The growth was largely due to increases in gain on security transactions of $531 thousand, or 100%, and insurance commissions and fees relating to SB One Insurance Agency of $156 thousand, or 11.3%, for the fourth quarter of 2019, as compared to the same period in 2018. 

Non-interest income increased $3.6 million, or 33.5%, to $14.3 million for the year ended December 31, 2019 as compared to the year ended December 31, 2018.  The increase was principally due to $1.4 million increase in insurance commissions and fees relating to SB One Insurance Agency, and a $2.0 million increase in gains on sale of securities, which were partially offset by a $334 thousand loss on the disposal of fixed assets relating to closing of the Company’s corporate center in Rockaway, NJ, and the sale of the Andover branch.

Non-interest Expense. The Company’s non-interest expenses increased $71 thousand, or 0.7%, to $10.32 million for the fourth quarter of 2019, as compared to the same period in 2018. The increase in non-interest expenses occurred largely in salaries and employee benefits, which increased $1.0 million, professional fees, which increased $171 thousand, and data processing, which increased $142 thousand. The increase in non-interest expenses for the fourth quarter of 2019, as compared to the same period in 2018, was the result of the Company’s continued growth, inclusive of the Enterprise merger net of cost savings. The aforementioned increases were partially offset by decreases in merger-related expenses and expenses and write-downs related to foreclosed real estate of $1.5 million and $143 thousand, respectively. The decrease in expenses and write-downs related to foreclosed real estate was driven by a gain on the sale of one property for $90 thousand. Included in non-interest expenses for the fourth quarter of 2019 are non-recurring expenses of $323 thousand primarily in professional fees.

The Company’s non-interest expenses increased $825 thousand, or 2.0%, to $41.2 million for the year ended December 31, 2019 as compared to the year ended December 31, 2018. The increase in non-interest expenses was primarily due to increases in salaries and employee benefits of $4.2 million, data processing of $641 thousand and occupancy of $607 thousand.  The aforementioned increases were partially offset by a decrease in merger related expenses of $5.8 million.

Income Tax Expense. The Company’s income tax expenses increased $949 thousand to $1.9 million for the fourth quarter of 2019, as compared to the same period last year. The Company’s effective tax rate for the fourth quarter of 2019 was 26.7%, as compared to 29.6% for the same period in 2018.

The Company’s income tax expenses increased $4.0 million to $7.1 million for the year ended December 31, 2019, as compared to the year ended December 31, 2018 as a result of an increase in pre-tax income. The Company’s effective tax rate for the year ended December 31, 2019 was 23.9%, as compared to 23.6% for the year ended December 31, 2018.

Financial Condition At December 31, 2019, the Company’s total assets were $2.0 billion, an increase of $206.0 million, or 11.5%, as compared to total assets of $1.8 billion at December 31, 2018.  The increase was mainly attributable to an increase in loans receivable of $154.1 million, or 10.4%, to $1.6 billion.

The Company’s total deposits increased $171.1 million, or 12.6%, to $1.5 billion at December 31, 2019, from $1.4 billion at December 31, 2018. The growth in deposits was mostly due to an increase in interest bearing deposits of $172.6 million, or 15.8%.

At December 31, 2019, the Company’s total stockholders’ equity was $199.2 million, an increase of $13.8 million when compared to December 31, 2018.  At December 31, 2019, the leverage, Tier I risk-based capital, total risk-based capital and common equity Tier I capital ratios for the Bank were 10.16%, 11.65%, 12.27% and 11.65%, respectively, all in excess of the ratios required to be deemed “well-capitalized.”

Asset and Credit QualityThe ratio of non-performing assets (“NPAs”), which include non-accrual loans, loans 90 days past due and still accruing, troubled debt restructured loans currently performing in accordance with renegotiated terms and foreclosed real estate, to total assets decreased to 0.83% at December 31, 2019, as compared to 1.43% at December 31, 2018.  The decrease in NPAs is mainly attributable to the payoff of two non-accrual commercial real estate loans totaling approximately $8.9 million. The ratio of NPAs to total assets decreased to 0.83% at December 31, 2019, as compared to 0.87% at September 30, 2019. NPAs exclude $2.5 million of Purchased Credit-Impaired (“PCI”) loans acquired through the merger with Community Bank of Bergen County (“Community Bank”). NPAs decreased $9.1 million to $16.7 million at December 31, 2019, as compared to $25.8 million at December 31, 2018.  Non-accrual loans, excluding $2.5 million of PCI loans, decreased $9.3 million, or 44.9%, to $11.4 million at December 31, 2019, as compared to $20.7 million at December 31, 2018.  Loans past due 30 to 89 days totaled $7.8 million at December 31, 2019, representing an increase of $4.0 million, or 105.9%, as compared to $3.8 million at December 31, 2018.

The Company continues to actively market its foreclosed real estate properties, the value of which decreased $356 thousand to $3.8 million at December 31, 2019 as compared to $4.1 million at December 31, 2018.  The decrease in foreclosed real estate properties was largely attributable to the sale of seven properties totaling $1.8 million, which was partially offset by three new foreclosed properties valued at $1.6 million. At December 31, 2019, the Company’s foreclosed real estate properties had an average carrying value of approximately $379 thousand per property.

The Company’s allowance for loan losses increased $1.5 million, or 17.0%, to $10.3 million, at December 31, 2019 as compared to $8.8 million at December 31, 2018. The Company’s outstanding credit mark recorded on the legacy Community Bank and Enterprise portfolios of $420.3 million totaled $6.5 million at December 31, 2019. The Company’s combined coverage of allowance for loan loss and credit mark on the legacy Community Bank and Enterprise portfolios totaled $16.7 million, or 1.02% of the overall loan portfolio, at December 31, 2019. The Company recorded $2.5 million in provision for loan losses for the year ended December 31, 2019, as compared to $1.4 million for the year ended December 31, 2018.  Additionally, the Company recorded net charge-offs of $1.0 million for the twelve months ended December 31, 2019, as compared to $3 thousand in net recoveries for the twelve months ended December 31, 2018. The allowance for loan losses as a percentage of non-accrual loans increased to 89.9% at December 31, 2019 from 43.5% at December 31, 2018.

About SB One Bancorp

SB One Bancorp (Nasdaq: SBBX), is the holding company for SB One Bank, a full-service, commercial bank that operates regionally with 18 branch locations in New Jersey and New York. Established in 1975, SB One Bank's strength is in its ability to build strong personal relationships with its customers and to serve the communities in which it operates. In addition to its branches and loan production offices, SB One Bank offers a full-service insurance agency, SB One Insurance Agency, Inc., and wealth services through SB One Wealth. SB One Bank reinforces its commitment to the communities in which it lives and serves through the SB One Foundation, Inc. which supports various local charitable organizations.

SB One Bancorp was recently added to the Russell 2000® Index and Russell 3000® Index. In 2017, it was recognized as one of the top 29 banks and thrifts nationwide and one of three from New Jersey that comprise the Sandler O’Neill Sm-All Stars Class of 2017. SB One Bancorp is one of the 50 Fastest Growing Companies in New Jersey as ranked by NJBIZ Magazine. SB One Bancorp President and Chief Executive Officer, Anthony Labozzetta, was named one of America’s Business Leaders in Banking by Forbes magazine and American Banker’s Community Banker of the Year in 2016.

For more details on SB One Bank, visit: www.SBOne.bank

Forward-Looking Statements

This press release contains statements that are forward looking and are made pursuant to the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to statements that may be identified by the use of words such as "expect," "estimate," “assume,” "believe," "anticipate," "will," "forecast," "plan," "project" or similar words. Such statements are based on SB One Bancorp’s current expectations and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, (1) difficulties and delays in integrating the business or fully realizing cost savings and other benefits; (2) operating costs, customer loss and business disruption following the mergers with Community Bank and Enterprise, including adverse effects on relationships with employees, may be greater than expected; (3) changes to interest rates; (4) the ability to control costs and expenses; (5) general economic conditions; (6) the success of SB One Bancorp’s efforts to diversify its revenue base by developing additional sources of non-interest income while continuing to manage its existing fee-based business; and (7) risks associated with the quality of SB One Bancorp’s assets and the ability of its borrowers to comply with repayment. Further information about these and other relevant risks and uncertainties may be found in SB One Bancorp’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and in subsequent filings with the Securities and Exchange Commission. SB One Bancorp undertakes no obligation to publicly release the results of any revisions to those forward looking statements that may be made to reflect events or circumstances after this date or to reflect the occurrence of unanticipated events.

SB ONE BANCORPAnthony Labozzetta, President/CEOAdriano Duarte, CFO (p) 844-256-7328     

SB ONE BANCORP
SUMMARY FINANCIAL HIGHLIGHTS
(In Thousands, Except Percentages and Per Share Data)
(Unaudited)
															12/31/2019 VS.
		12/31/19				9/30/19				12/31/18					9/30/19					12/31/18
BALANCE SHEET HIGHLIGHTS - Period End Balances
Total securities		$	216,193			$	211,467			$	186,217					2.2		%			16.1		%
Total loans			1,628,846				1,563,610				1,474,775					4.2		%			10.4		%
Allowance for loan losses			(10,267	)			(9,750	)			(8,775	)				5.3		%			17.0		%
Total assets			2,001,657				1,934,259				1,795,703					3.5		%			11.5		%
Total deposits			1,525,041				1,526,856				1,353,939					(0.1	)	%			12.6		%
Total borrowings and junior subordinated debt			260,983				191,715				247,765					36.1		%			5.3		%
Total shareholders' equity			199,229				196,079				185,444					1.6		%			7.4		%
FINANCIAL DATA - QUARTER ENDED:
Net interest income (tax equivalent) (a)		$	15,011			$	14,753			$	11,575					1.7		%			29.7		%
Provision for loan losses			548				636				210					(13.8	)	%			161.0		%
Total non-interest income			3,217				3,103				2,493					3.7		%			29.0		%
Total non-interest expense			10,344				10,187				10,273					1.5		%			0.7		%
Income before provision for income taxes (tax equivalent)			7,336				7,033				3,585					4.3		%			104.6		%
Provision for income taxes			1,940				1,820				991					6.6		%			95.8		%
Taxable equivalent adjustment (a)			65				68				241					(4.4	)	%			(73.0	)	%
Net income		$	5,331			$	5,145			$	2,353					3.6		%			126.6		%
Net income per common share - Basic		$	0.57			$	0.55			$	0.29					3.6		%			96.6		%
Net income per common share - Diluted		$	0.57			$	0.55			$	0.29					3.6		%			96.6		%
Return on average assets			1.09		%		1.08		%		0.62		%			1.3		%			76.4		%
Return on average equity			10.77		%		10.56		%		6.00		%			2.0		%			79.6		%
Efficiency ratio (b)			56.95		%		57.27		%		74.30		%			(0.6	)	%			(23.3	)	%
Net interest margin (tax equivalent)			3.24		%		3.26		%		3.21		%			(0.6	)	%			0.9		%
Avg. interest earning assets/Avg. interest bearing liabilities			1.25				1.26				1.27					(0.3	)	%			(1.6	)	%
FINANCIAL DATA - YEAR TO DATE:
Net interest income (tax equivalent) (a)		$	59,591							$	44,968
Provision for loan losses			2,531								1,437
Total non-interest income			14,345								10,749
Total non-interest expense			41,235								40,410
Income before provision for income taxes (tax equivalent)			30,170								13,870
Provision for income taxes			7,096								3,059
Taxable equivalent adjustment (a)			531								888
Net income		$	22,543							$	9,923
Net income per common share - Basic		$	2.41							$	1.26
Net income per common share - Diluted		$	2.40							$	1.25
Return on average assets			1.20		%						0.70		%
Return on average equity			11.66		%						6.62		%
Efficiency ratio (b)			56.17		%						73.70		%
Net interest margin (tax equivalent)			3.36		%						3.36		%
Avg. interest earning assets/Avg. interest bearing liabilities			1.26								1.28
SHARE INFORMATION:
Book value per common share		$	21.29			$	20.81			$	19.45					2.3		%			9.4		%
Tangible book value per common share			18.19				17.71				16.36					2.7		%			11.1		%
Outstanding shares- period ending			9,357,811				9,423,931				9,532,943					(0.7	)	%			(1.8	)	%
Average diluted shares outstanding (year to date)			9,381,642				9,410,311				7,921,269					(0.3	)	%			18.4		%
CAPITAL RATIOS:
Total equity to total assets			9.95		%		10.14		%		10.32		%			(1.8	)	%			(3.5	)	%
Leverage ratio (c)			10.16		%		10.22		%		12.06		%			(0.6	)	%			(15.8	)	%
Tier 1 risk-based capital ratio (c)			11.65		%		12.00		%		12.34		%			(2.9	)	%			(5.6	)	%
Total risk-based capital ratio (c)			12.27		%		12.61		%		12.94		%			(2.7	)	%			(5.2	)	%
Common equity Tier 1 capital ratio (c)			11.65		%		12.00		%		12.34		%			(2.9	)	%			(5.6	)	%
ASSET QUALITY:
Non-accrual loans (e)		$	11,415			$	12,019			$	20,704					(5.0	)	%			(44.9	)	%
Loans 90 days past due and still accruing			-				1				-					-		%			-		%
Troubled debt restructured loans ("TDRs") (d)			1,456				1,238				906					17.6		%			60.7		%
Foreclosed real estate			3,793				3,600				4,149					5.4		%			(8.6	)	%
Non-performing assets ("NPAs")		$	16,664			$	16,858			$	25,759					(1.2	)	%			(35.3	)	%
Foreclosed real estate, criticized and classified assets (e)		$	25,180			$	24,233			$	24,006					3.9		%			4.9		%
Loans past due 30 to 89 days		$	7,797			$	5,522			$	3,787					41.2		%			105.9		%
Charge-offs (Recoveries) , net (quarterly)		$	30			$	440			$	30					(93.2	)	%			-		%
Charge-offs (Recoveries) , net as a % of average loans (annualized)			0.01		%		0.11		%		0.01		%			(93.4	)	%			(23.0	)	%
Non-accrual loans to total loans			0.70		%		0.77		%		1.40		%			(8.8	)	%			(49.9	)	%
NPAs to total assets			0.83		%		0.87		%		1.43		%			(4.5	)	%			(41.8	)	%
NPAs excluding TDR loans (d) to total assets			0.76		%		0.81		%		1.35		%			(5.9	)	%			(43.9	)	%
Non-accrual loans to total assets			0.57		%		0.62		%		1.12		%			(8.2	)	%			(49.2	)	%
Allowance for loan losses as a % of non-accrual loans			89.94		%		81.12		%		43.51		%			10.9		%			106.7		%
Allowance for loan losses to total loans			0.63		%		0.62		%		0.60		%			1.1		%			5.9		%
(a) Full taxable equivalent basis, using a 30.09% effective tax rate and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance
(b) Efficiency ratio calculated non-interest expense divided by net interest income plus non-interest income
(c) SB One Bank capital ratios
(d) Troubled debt restructured loans currently performing in accordance with renegotiated terms
(e) PCI loans acquired through merger with Community Bank excluded from non-accrual loans and criticized and classified assets totaled $2.5 million

SB ONE BANCORP
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)
ASSETS	December 31, 2019				December 31, 2018
Cash and due from banks	$	9,525			$	11,768
Interest-bearing deposits with other banks		34,161				14,910
Cash and cash equivalents		43,686				26,678
Interest bearing time deposits with other banks		200				200
Securities available for sale, at fair value		212,181				182,139
Securities held to maturity		4,012				4,078
Other Bank Stock, at cost		12,498				11,764
Loans receivable, net of unearned income		1,628,846				1,474,775
Less: allowance for loan losses		10,267				8,775
Net loans receivable		1,618,579				1,466,000
Foreclosed real estate		3,793				4,149
Premises and equipment, net		19,080				19,215
Right-of-use assets, net		4,644				-
Accrued interest receivable		6,175				6,546
Goodwill and intangibles		29,039				29,446
Bank-owned life insurance		37,209				35,778
Other assets		10,561				9,710
Total Assets	$	2,001,657			$	1,795,703
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
Non-interest bearing	$	258,311			$	259,807
Interest bearing		1,266,730				1,094,132
Total Deposits		1,525,041				1,353,939
Borrowings		233,114				219,906
Lease liability		4,727				-
Accrued interest payable and other liabilities		11,677				8,555
Subordinated debentures		27,869				27,859
Total Liabilities		1,802,428				1,610,259
Total Stockholders' Equity		199,229				185,444
Total Liabilities and Stockholders' Equity	$	2,001,657			$	1,795,703

SB ONE BANCORP
CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands Except Per Share Data)
(Unaudited)
	Three Months Ended December 31,							Year Ended
		2019				2018		12/31/19				12/31/18
INTEREST INCOME
Loans receivable, including fees	$	19,183			$	13,888		$	75,537			$	51,359
Securities:
Taxable		1,524				1,031			5,466				3,507
Tax-exempt		128				472			1,048				1,744
Federal funds sold		-				-			-				-
Interest bearing deposits		47				30			258				99
Total Interest Income		20,882				15,421			82,309				56,709
INTEREST EXPENSE
Deposits		4,517				2,805			17,595				8,078
Borrowings		1,102				965			4,388				3,288
Junior subordinated debentures		317				317			1,266				1,263
Total Interest Expense		5,936				4,087			23,249				12,629
Net Interest Income		14,946				11,334			59,060				44,080
PROVISION FOR LOAN LOSSES		548				210			2,531				1,437
Net Interest Income after Provision for Loan Losses		14,398				11,124			56,529				42,643
NON-INTEREST INCOME
Service fees on deposit accounts		355				331			1,403				1,290
ATM and debit card fees		277				266			1,075				983
Bank owned life insurance		234				198			931				761
Insurance commissions and fees		1,535				1,379			8,017				6,640
Investment brokerage fees		8				12			134				104
Gain (loss) on securities transactions		531				-			2,055				36
(Loss) gain on disposal of fixed assets		(42	)			-			(334	)			9
Other		319				307			1,064				926
Total Non-Interest Income		3,217				2,493			14,345				10,749
NON-INTEREST EXPENSE
Salaries and employee benefits		6,246				5,208			24,934				20,710
Occupancy, net		779				690			3,383				2,776
Data processing		1,053				911			3,992				3,351
Furniture and equipment		370				301			1,345				1,194
Advertising and promotion		151				99			545				587
Professional fees		581				410			1,687				1,412
Director fees		166				140			637				550
FDIC assessment		121				136			706				529
Insurance		32				28			126				210
Stationary and supplies		84				80			331				285
Merger-related expenses		-				1,460			-				5,804
Loan collection costs		43				52			276				255
Expenses and write-downs related to foreclosed real estate		(47	)			96			286				324
Amortization of intangible assets		101				65			406				247
Other		664				597			2,581				2,176
Total Non-Interest Expense		10,344				10,273			41,235				40,410
Income before Income Taxes		7,271				3,344			29,639				12,982
INCOME TAX EXPENSE		1,940				991			7,096				3,059
Net Income	$	5,331			$	2,353		$	22,543			$	9,923
EARNINGS PER SHARE
Basic	$	0.57			$	0.29		$	2.41			$	1.26
Diluted	$	0.57			$	0.29		$	2.40			$	1.25

SB ONE BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Dollars In Thousands)
(Unaudited)
		Three Months Ended December 31,
			2019											2018
		Average								Average			Average								Average
		Balance				Interest				Rate (2)			Balance				Interest				Rate (2)
Earning Assets:
Securities:
Tax exempt (3)		$	17,566			$	193			4.36	%		$	63,114			$	713			4.48	%
Taxable			205,615				1,524			2.94	%			130,105				1,031			3.14	%
Total securities			223,181				1,717			3.05	%			193,219				1,744			3.58	%
Total loans receivable (1) (4)			1,592,100				19,183			4.78	%			1,225,917				13,888			4.49	%
Other interest-earning assets			20,872				47			0.89	%			10,973				30			1.08	%
Total earning assets			1,836,153				20,947			4.53	%			1,430,109				15,662			4.34	%
Non-interest earning assets			125,299											98,408
Allowance for loan losses			(10,001	)										(8,753	)
Total Assets		$	1,951,451										$	1,519,764
Sources of Funds:
Interest bearing deposits:
NOW		$	256,906			$	482			0.74	%		$	261,737			$	417			0.63	%
Money market			246,363				965			1.55	%			185,419				879			1.88	%
Savings			219,585				283			0.51	%			210,092				284			0.54	%
Time			531,415				2,787			2.08	%			292,389				1,225			1.66	%
Total interest bearing deposits			1,254,269				4,517			1.43	%			949,637				2,805			1.17	%
Borrowed funds			182,274				1,102			2.40	%			144,703				965			2.65	%
Subordinated debentures			27,867				317			4.51	%			27,857				317			4.51	%
Total interest bearing liabilities			1,464,410				5,936			1.61	%			1,122,197				4,087			1.44	%
Non-interest bearing liabilities:
Demand deposits			271,282											235,342
Other liabilities			17,810											5,304
Total non-interest bearing liabilities			289,092											240,646
Stockholders' equity			197,949											156,921
Total Liabilities and Stockholders' Equity		$	1,951,451										$	1,519,764
Net Interest Income and Margin (5)							15,011			3.24	%							11,575			3.21	%
Tax-equivalent basis adjustment							(65	)										(241	)
Net Interest Income						$	14,946										$	11,334
(1) Includes loan fee income
(2) Average rates on securities are calculated on amortized costs
(3) Full taxable equivalent basis, using an effective tax rate of 30.09% in 2019 and 2018 and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance
(4) Loans outstanding include non-accrual loans
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets
SB ONE BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Dollars In Thousands)
(Unaudited)
		Three Months Ended December 31, 2019											Three Months Ended September 30, 2019
		Average								Average			Average								Average
		Balance				Interest				Rate (2)			Balance				Interest				Rate (2)
Earning Assets:
Securities:
Tax exempt (3)		$	17,566			$	193			4.36	%		$	17,712			$	203			4.55	%
Taxable			205,615				1,524			2.94	%			195,463				1,490			3.02	%
Total securities			223,181				1,717			3.05	%			213,175				1,693			3.15	%
Total loans receivable (1) (4)			1,592,100				19,183			4.78	%			1,548,515				19,135			4.90	%
Other interest-earning assets			20,872				47			0.89	%			32,383				97			1.19	%
Total earning assets			1,836,153				20,947			4.53	%			1,794,073				20,925			4.63	%
Non-interest earning assets			125,299											122,954
Allowance for loan losses			(10,001	)										(9,898	)
Total Assets		$	1,951,451										$	1,907,129
Sources of Funds:
Interest bearing deposits:
NOW		$	256,906			$	482			0.74	%		$	242,258			$	498			0.82	%
Money market			246,363				965			1.55	%			234,127				1,080			1.83	%
Savings			219,585				283			0.51	%			221,892				369			0.66	%
Time			531,415				2,787			2.08	%			531,178				2,808			2.10	%
Total interest bearing deposits			1,254,269				4,517			1.43	%			1,229,455				4,755			1.53	%
Borrowed funds			182,274				1,102			2.40	%			168,998				1,099			2.58	%
Subordinated debentures			27,867				317			4.51	%			27,865				318			4.53	%
Total interest bearing liabilities			1,464,410				5,936			1.61	%			1,426,318				6,172			1.72	%
Non-interest bearing liabilities:
Demand deposits			271,282											268,864
Other liabilities			17,810											17,141
Total non-interest bearing liabilities			289,092											286,005
Stockholders' equity			197,949											194,806
Total Liabilities and Stockholders' Equity		$	1,951,451										$	1,907,129
Net Interest Income and Margin (5)							15,011			3.24	%							14,753			3.26	%
Tax-equivalent basis adjustment							(65	)										(68	)
Net Interest Income						$	14,946										$	14,685
(1) Includes loan fee income
(2) Average rates on securities are calculated on amortized costs
(3) Full taxable equivalent basis, using an effective tax rate of 30.09% in 2019 and 2018 and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance
(4) Loans outstanding include non-accrual loans
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets
SB ONE BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Dollars In Thousands)
(Unaudited)
		Year Ended December 31,
			2019											2018
		Average								Average			Average								Average
		Balance				Interest				Rate (2)			Balance				Interest				Rate (2)
Earning Assets:
Securities:
Tax exempt (3)		$	36,031			$	1,579			4.38	%		$	61,673			$	2,632			4.27	%
Taxable			175,597				5,466			3.11	%			126,104				3,507			2.78	%
Total securities			211,628				7,045			3.33	%			187,777				6,139			3.27	%
Total loans receivable (1) (4)			1,539,816				75,537			4.91	%			1,139,199				51,359			4.51	%
Other interest-earning assets			23,308				258			1.11	%			10,586				99			0.94	%
Total earning assets			1,774,752				82,840			4.67	%			1,337,562				57,597			4.31	%
Non-interest earning assets			119,108											97,078
Allowance for loan losses			(9,516	)										(8,185	)
Total Assets		$	1,884,344										$	1,426,455
Sources of Funds:
Interest bearing deposits:
NOW		$	251,171			$	1,879			0.75	%		$	257,314			$	1,527			0.59	%
Money market			238,052				4,388			1.84	%			124,973				1,952			1.56	%
Savings			222,392				1,351			0.61	%			216,275				818			0.38	%
Time			498,798				9,977			2.00	%			270,807				3,781			1.40	%
Total interest bearing deposits			1,210,413				17,595			1.45	%			869,369				8,078			0.93	%
Borrowed funds			171,523				4,388			2.56	%			150,294				3,288			2.19	%
Subordinated debentures			27,864				1,266			4.54	%			27,853				1,263			4.53	%
Total interest bearing liabilities			1,409,800				23,249			1.65	%			1,047,516				12,629			1.21	%
Non-interest bearing liabilities:
Demand deposits			268,079											223,984
Other liabilities			13,133											5,060
Total non-interest bearing liabilities			281,212											229,044
Stockholders' equity			193,332											149,895
Total Liabilities and Stockholders' Equity		$	1,884,344										$	1,426,455
Net Interest Income and Margin (5)							59,591			3.36	%							44,968			3.36	%
Tax-equivalent basis adjustment							(531	)										(888	)
Net Interest Income						$	59,060										$	44,080
(1) Includes loan fee income
(2) Average rates on securities are calculated on amortized costs
(3) Full taxable equivalent basis, using an effective tax rate of 30.09% in 2019 and 2018 and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance
(4) Loans outstanding include non-accrual loans
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets

SB ONE BANCORP
Segment Reporting
(Dollars In Thousands)
(Unaudited)
	Three Months Ended December 31, 2019									Three Months Ended December 31, 2018
	Banking and									Banking and
	Financial			Insurance						Financial			Insurance
	Services			Services			Total			Services			Services			Total
Net interest income from external sources	$	14,946		$	-		$	14,946		$	11,334		$	-		$	11,334
Other income from external sources		1,611			1,606			3,217			1,074			1,419			2,493
Depreciation and amortization		476			13			489			462			8			470
Income before income taxes		7,153			118			7,271			3,178			166			3,344
Income tax expense (1)		1,893			47			1,940			925			66			991
Total assets		1,995,973			5,684			2,001,657			1,790,851			4,852			1,795,703
	Year Ended December 31, 2019									Year Ended December 31, 2018
	Banking and									Banking and
	Financial			Insurance						Financial			Insurance
	Services			Services			Total			Services			Services			Total
Net interest income from external sources	$	59,060		$	-		$	59,060		$	44,080		$	-		$	44,080
Other income from external sources		6,129			8,216			14,345			3,975			6,774			10,749
Depreciation and amortization		2,005			46			2,051			1,809			27			1,836
Income before income taxes		27,358			2,281			29,639			10,987			1,995			12,982
Income tax expense (1)		6,184			912			7,096			2,261			798			3,059
Total assets		1,995,973			5,684			2,001,657			1,790,851			4,852			1,795,703
(1) Calculated at statutory tax rate of 30.09% in 2019 and 2018 for the insurance services segment