Southern Missouri Bancorp, Inc. (“Company”) (NASDAQ: SMBC), the
parent corporation of Southern Bank (“Bank”), today announced
preliminary net income for the second quarter of fiscal 2021 of
$12.0 million, an increase of $4.3 million, or 56.1%, as compared
to the same period of the prior fiscal year. The increase was
attributable to increases in net interest income and noninterest
income, partially offset by increases in provision for income
taxes, noninterest expense, and provision for credit losses.
Preliminary net income was $1.32 per fully diluted common share for
the second quarter of fiscal 2021, an increase of $.48 as compared
to the $.84 per fully diluted common share reported for the same
period of the prior fiscal year.
Highlights for the second quarter of fiscal
2021:
- Annualized return on average assets was 1.87%, while annualized
return on average common equity was 18.3%, as compared to 1.36% and
12.6%, respectively, in the same quarter a year ago, and 1.57% and
15.6%, respectively, in the first quarter of fiscal 2021, the
linked quarter.
- Earnings per common share (diluted) were $1.32, up $.48, or
57.1%, as compared to the same quarter a year ago, and up $.23, or
21.1%, from the first quarter of fiscal 2021, the linked
quarter.
- Provision for credit losses was $612,000, an increase of
$224,000, or 57.7%, as compared to the same period of the prior
year, and down $162,000, or 20.9%, as compared to the first quarter
of fiscal 2021, the linked quarter. Nonperforming assets were $11.1
million, or 0.42% of total assets, at December 31, 2020, as
compared to $11.3 million, or 0.44% of total assets, at September
30, 2020, and $14.1 million, or 0.61% of total assets, at December
31, 2019, one year prior.
- Net loans decreased $29.1 million during the second quarter, as
balances of SBA Paycheck Protection Program (PPP) loans declined by
$38.2 million, as forgiveness processing began in earnest.
- Deposit balances increased $97.0 million in the second quarter
of fiscal 2021. Typically, the second quarter of the fiscal year is
the strongest for the Company’s deposit growth, most notably in
nonmaturity accounts. Deposits continued to migrate away from
certificates of deposit and to nonmaturity accounts.
- Net interest margin for the second quarter of fiscal 2021 was
3.92%, up from the 3.70% reported for the year ago period, and up
from the 3.73% figure reported for the first quarter of fiscal
2021, the linked quarter. Net interest income was increased
significantly by accelerated accretion of deferred origination fees
on PPP loans as those loans were repaid through SBA forgiveness.
Discount accretion on acquired loan portfolios was modestly higher
in the current quarter as compared to the linked quarter, and
modestly lower as compared to the year ago period.
- Noninterest income was up 55.7% for the second quarter of
fiscal 2021, as compared to the year ago period, and was up 15.8%
as compared to the first quarter of fiscal 2021, the linked
quarter. Nonrecurring benefits realized on bank-owned life
insurance during the quarter contributed significantly to the
increase, and the Company continued to originate a substantial
volume of mortgage loans for sale into the secondary
market.
- Noninterest expense was up 3.1% for the second quarter of
fiscal 2021, as compared to the year ago period, and was down 0.5%
from the first quarter of fiscal 2021, the linked quarter.
Dividend Declared:
The Board of Directors, on January 19, 2021, declared a
quarterly cash dividend on common stock of $0.16, payable February
26, 2021, to stockholders of record at the close of business on
February 12, 2021, marking the 107th consecutive quarterly dividend
since the inception of the Company, and representing an increase of
6.7% over the quarterly dividend paid previously. The Board of
Directors and management believe the payment of a quarterly cash
dividend enhances stockholder value and demonstrates our commitment
to and confidence in our future prospects.
Conference Call:
The Company will host a conference call to review the
information provided in this press release on Tuesday, January 26,
2021, at 3:30 p.m., central time. The call will be available live
to interested parties by calling 1-888-339-0709 in the United
States (Canada: 1-855-669-9657, international: 1-412-902-4189).
Participants should ask to be joined into the Southern Missouri
Bancorp (SMBC) call. Telephone playback will be available beginning
one hour following the conclusion of the call through February 8,
2021. The playback may be accessed by dialing 1-877-344-7529
(Canada: 1-855-669-9658, international: 1-412-317-0088), and using
the conference passcode 10151898.
Balance Sheet Summary:
The Company’s balance sheet grew modestly from June 30, 2020,
with total assets of $2.6 billion at December 31, 2020, reflecting
an increase of $80.8 million, or 3.2%. Growth primarily reflected
increases in cash and cash equivalents and available-for-sale
(“AFS”) securities, partially offset by a decrease in loans
receivable.
Cash equivalents and time deposits were a combined $150.5
million at December 31, 2020, an increase of $95.3 million, or
175.5%, as compared to June 30, 2020, increasing primarily as a
result of rapid deposit growth and loan repayments. AFS securities
were $181.1 million at December 31, 2020, an increase of $4.6
million, or 2.6%, as compared to June 30, 2020.
Loans, net of the allowance for credit losses (ACL), were $2.1
billion at December 31, 2020, a decrease of $20.5 million, or 1.0%,
as compared to June 30, 2020. Gross loans decreased by $10.2
million, or 0.5%, during the first six months of the fiscal year,
while the ACL at December 31, 2020, reflected an increase of $10.3
million, as compared to the balance of our allowance for loan and
lease losses (ALLL) at June 30, 2020. The Company adopted ASU
2016-13, Financial Instruments – Credit Losses, also known as the
current expected credit loss (“CECL”) standard, effective as of
July 1, 2020, the beginning of our 2021 fiscal year. Adoption
resulted in a $9.3 million increase in the ACL, relative to the
ALLL as of June 30, 2020, while provisioning in excess of net
charge offs during the first six months of fiscal 2021 increased
the ACL by an additional $1.0 million, as compared to July 1, 2020.
The decrease in loan balances in the portfolio was primarily
attributable to commercial loans, partially offset by increases in
commercial real estate loans, residential real estate loans, and
drawn construction loan balances. Commercial loan balances
decreased primarily as a result of forgiveness of PPP loans, which
declined by $36.8 million in the fiscal year to date, and by $38.2
million in the quarter ended December 31, 2020, to stand at $95.5
million. Residential real estate loans increased primarily due to
growth in 1- to 4-family residential lending, and commercial real
estate loans increased primarily due to loans secured by
nonresidential owner-occupied property. Management expects to
continue to receive significant PPP forgiveness payments in the
quarter ended March 31, 2021, although these will be somewhat
offset by anticipated funding of “second draw” PPP loans under the
program re-opened by the SBA in January 2021. Loans anticipated to
fund in the next 90 days stood at $85.1 million at December 31,
2020, as compared to $122.7 million at September 30, 2020, and
$72.7 million at December 31, 2019. The pipeline figure at December
31, 2020, did not include second draw PPP loans.
Nonperforming loans were $8.3 million, or 0.39% of gross loans,
at December 31, 2020, as compared to $8.7 million, or 0.40% of
gross loans at June 30, 2020, and $10.4 million, or 0.54% of gross
loans at December 31, 2019. Nonperforming assets were $11.1
million, or 0.42% of total assets, at December 31, 2020, as
compared to $11.2 million, or 0.44% of total assets, at June 30,
2020, and $14.1 million, or 0.61% of total assets, at December 31,
2019. The decrease in nonperforming loans over the previous twelve
months was attributed primarily to the resolution of certain
nonperforming loans acquired in the November 2018 acquisition of
Gideon Bancshares and its subsidiary, First Commercial Bank (the
“Gideon Acquisition”).
Our ACL at December 31, 2020, totaled $35.5 million,
representing 1.64% of gross loans and 425.8% of nonperforming
loans, as compared to an ALLL of $25.1 million, representing 1.16%
of gross loans and 290.4% of nonperforming loans at June 30, 2020,
and an ALLL of $20.8 million, or 1.07% of gross loans and 200.0% of
nonperforming loans, at December 31, 2019. The ACL at December 31,
2020, also represented 1.72% of gross loans excluding PPP loans.
The Company has estimated its credit losses as of December 31,
2020, under ASC 320-20, and management believes the allowance for
credit losses as of that date is adequate based on that estimate;
however, there remains significant uncertainty regarding the
possible length of the COVID-19 pandemic and the aggregate impact
that it will have on global and regional economies, including
uncertainty regarding the effectiveness of recent efforts by the
U.S. government and Federal Reserve to respond to the pandemic and
its economic impact. Management considered the impact of the
pandemic on its consumer and business borrowers, particularly those
business borrowers most affected by efforts to contain the
pandemic, including our borrowers in the retail and multi-tenant
retail industry, restaurants, and hotels.
Provisions of the CARES Act and subsequent legislation allow
financial institutions the option to temporarily suspend certain
requirements under U.S. GAAP related to troubled debt
restructurings (TDRs) for certain loans that were otherwise current
and performing prior to the COVID-19 pandemic, but for which
borrowers experienced or expected difficulties due to the impact of
the pandemic. Initially, deferrals under this program were
generally granted for three-month periods, while interest-only
modifications were generally for six-month periods. Some borrowers
were granted additional periods of deferral or interest-only
modifications. The Company did not account for these loans as TDRs.
As of December 31, 2020, loans for which COVID-related payment
deferrals and interest-only payment modifications remained in place
included approximately 17 loans with balances totaling $40.3
million, as compared to approximately 900 loans with balances
totaling $380.2 million with such deferrals or modifications in
place at June 30, 2020. Details by loan type are included in the
table at the conclusion of this document. For borrowers whose
payment term have not returned to the original terms under their
loan agreement as of December 31, 2020, the Company has generally
classified the credit as a “watch” status credit. Loans remaining
under a COVID-related payment deferral or interest-only
modification which have been placed on watch status total $38.7
million. While management considers progress made by our borrowers
in responding to the pandemic to be relatively strong, and the
performance of our loan portfolio to be encouraging to date, we
cannot predict with certainty the difficulties to be faced in
coming months. Communities where our borrowers operate may
experience increases in COVID-19 cases and reductions in business
activity or employee attendance, and borrowers could be required by
local authorities to restrict activity.
Total liabilities were $2.4 billion at December 31, 2020, an
increase of $71.5 million, or 3.1%, as compared to June 30,
2020.
Deposits were $2.3 billion at December 31, 2020, an increase of
$80.2 million, or 3.7%, as compared to June 30, 2020. This increase
primarily reflected an increase in interest-bearing transaction
accounts, noninterest-bearing transaction accounts, savings
accounts, and money market deposits accounts, partially offset by a
decrease in time deposits. The increase included a $14.8 million
increase in public unit funds, and was net of a $7.3 million
decrease in brokered deposits. Public unit balances were $320.0
million at December 31, 2020, while brokered time deposits totaled
$16.0 million, and brokered money market deposits were $20.0
million. Depositors continue to hold unusually high balances in the
uncertain environment. The average loan-to-deposit ratio for the
second quarter of fiscal 2021 was 98.5%, as compared to 100.4% for
the same period of the prior fiscal year.
FHLB advances were $63.3 million at December 31, 2020, a
decrease of $6.7 million, or 9.6%, as compared to June 30, 2020, as
the Company’s deposit inflows outpaced loan demand or desired
investment portfolio growth. The Company has continued to monitor
the availability of the Federal Reserve’s PPP Lending Facility
(PPPLF), but has not utilized it to date, given our improved
liquidity position and the lack of attractive alternative
investment options.
The Company’s stockholders’ equity was $267.7 million at
December 31, 2020, an increase of $9.3 million, or 3.2%, as
compared to June 30, 2020. The increase was attributable primarily
to earnings retained after cash dividends paid, partially offset by
the one-time negative adjustment to retained earnings resulting
from the adoption of the CECL standard and repurchases of the
Company’s common stock. Since re-starting the repurchase program in
October 2020, the Company repurchased 90,793 common shares for $2.6
million through December 31, 2020, at an average price of
$29.06.
Quarterly Income Statement Summary:
The Company’s net interest income for the three-month period
ended December 31, 2020, was $23.5 million, an increase of $4.1
million, or 21.4%, as compared to the same period of the prior
fiscal year. The increase was attributable to a 14.8% increase in
the average balance of interest-earning assets, combined with an
increase in net interest margin to 3.92% in the current three-month
period, from 3.70% in the same period a year ago. As a material
amount of PPP loans were forgiven and therefore repaid ahead of
their scheduled maturity, the Company recognized accelerated
accretion of interest income from deferred origination fees on
these loans. In the current quarter, this component of interest
income totaled $968,000, adding 16 basis points to the net interest
margin, with no comparable item in the year ago period.
Loan discount accretion and deposit premium amortization related
to the Company’s August 2014 acquisition of Peoples Bank of the
Ozarks, the June 2017 acquisition of Capaha Bank, the February 2018
acquisition of Southern Missouri Bank of Marshfield, the Gideon
Acquisition, and the May 2020 acquisition of Central Federal
Savings & Loan Association of Rolla (the Central Federal
Acquisition), resulted in $478,000 in net interest income for the
three-month period ended December 31, 2020, as compared to $525,000
in net interest income for the same period a year ago. The Company
generally expects this component of net interest income will
continue to decline over time, although volatility may occur to the
extent we have periodic resolutions of specific loans. Combined,
these components of net interest income contributed eight basis
points to net interest margin in the three-month period ended
December 31, 2020, as compared to a contribution of 10 basis points
in the same period of the prior fiscal year, and as compared to the
six basis point contribution in the linked quarter, ended September
30, 2020, when net interest margin was 3.73%. Additionally, in the
year-ago period, the Company recognized an additional $194,000 in
interest income as a result of the resolution of a limited number
of nonperforming loans, with no material contribution from similar
resolutions in the current or linked period. This recognition of
interest income in the year-ago period contributed four basis
points to net interest margin.
The provision for credit losses for the three-month period ended
December 31, 2020, was $612,000, as compared to $388,000 in the
same period of the prior fiscal year. The limited increase as
compared to the same quarter a year ago was attributable primarily
to continued uncertainty regarding the economic environment
resulting from the COVID-19 pandemic and the potential impact on
the Company’s borrowers, partially offset by relatively consistent
levels of net charge offs, adversely classified credits, and
nonperforming loans. The Company assesses that the outlook is
little changed as compared to the quarter ended June 30, 2020. As a
percentage of average loans outstanding, the provision for credit
losses in the current three-month period represented a charge of
0.11% (annualized), while the Company recorded net charge offs
during the period of 0.04% (annualized). During the same period of
the prior fiscal year, the provision represented a charge of 0.08%
(annualized), while the Company recorded net charge offs of 0.06%
(annualized).
The Company’s noninterest income for the three-month period
ended December 31, 2020, was $5.7 million, an increase of $2.0
million, or 55.7%, as compared to the same period of the prior
fiscal year. In the current period, increases in gains realized on
the sale of residential real estate loans originated for that
purpose, earnings on bank-owned life insurance, loan servicing
income, and bank card interchange income were partially offset by
decreases in deposit account service charges. Earnings on
bank-owned life insurance were increased by a non-recurring benefit
of $696,000. Gains realized on the sale of residential real estate
loans originated for that purpose increased as origination of these
loans more than quadrupled as compared to the year ago period, and
also increased from the linked quarter, while pricing modestly
improved. Our portfolio of serviced loans has increased notably in
recent quarters, up 16.2% during the quarter ended December 31,
2020, as servicing income increases through fees received and the
recognition of mortgage servicing rights at origination. Bank card
interchange income increased as a result of a 10% increase in the
number of bank card transactions and a 17% increase in bank card
dollar volume, as compared to the same quarter a year ago.
Noninterest expense for the three-month period ended December
31, 2020, was $13.4 million, an increase of $410,000, or 3.1%, as
compared to the same period of the prior fiscal year. The increase
was attributable primarily to increases in compensation and
benefits, deposit insurance premiums, data processing expenses, and
occupancy expenses, partially offset by reductions in amortization
of core deposit intangibles and other expenses. Other expenses
declined primarily due to inclusion in the year ago period of a
$327,000 loss on the disposal of two bank facilities that had been
acquired in the Gideon Acquisition, as well as due to reduced
employee travel expenses and customer entertainment. The increase
in compensation and benefits as compared to the prior year
primarily reflected standard increases in compensation and an
increase in employee headcount over the prior year, due in part to
the Central Federal Acquisition, as well as a de novo branch opened
in July 2020. Deposit insurance premiums reflected a return to a
normalized level of premiums after the Company benefited from
one-time assessment credits for much of the prior fiscal year. Data
processing expenses increased primarily due to licensing of updated
productivity, mobility, and security software. Occupancy expenses
increased in part due to additional locations, as well as
replacement of some ATMs with ITMs with video teller capability.
The efficiency ratio for the three-month period ended December 31,
2020, was 45.9%, as compared to 56.5% in the same period of the
prior fiscal year, with the improvement attributable primarily to
the current period’s increases in net interest income and
noninterest income, while expense growth was contained.
The income tax provision for the three-month period ended
December 31, 2020, was $3.2 million, an increase of 64.1% as
compared to the same period of the prior fiscal year, as higher
pre-tax income combined with an increase in the effective tax rate,
to 20.7%, as compared to 19.9% in the same period a year ago. The
higher effective tax rate was attributable primarily to the
significant increase in pre-tax income, without corresponding
increases in tax-advantaged investments.
Forward-Looking Information:
Except for the historical information contained herein, the
matters discussed in this press release may be deemed to be
forward-looking statements that are subject to known and unknown
risks, uncertainties, and other factors that could cause the actual
results to differ materially from the forward-looking statements,
including: potential adverse impacts to the economic conditions in
the Company’s local market areas, other markets where the Company
has lending relationships, or other aspects of the Company’s
business operations or financial markets, generally, resulting from
the ongoing COVID-19 pandemic and any governmental or societal
responses thereto; expected cost savings, synergies and other
benefits from our merger and acquisition activities might not be
realized to the extent anticipated, within the anticipated time
frames, or at all, and costs or difficulties relating to
integration matters, including but not limited to customer and
employee retention, might be greater than expected; the strength of
the United States economy in general and the strength of the local
economies in which we conduct operations; fluctuations in interest
rates and in real estate values; monetary and fiscal policies of
the FRB and the U.S. Government and other governmental initiatives
affecting the financial services industry; the risks of lending and
investing activities, including changes in the level and direction
of loan delinquencies and write-offs and changes in estimates of
the adequacy of the allowance for credit losses; our ability to
access cost-effective funding; the timely development of and
acceptance of our new products and services and the perceived
overall value of these products and services by users, including
the features, pricing and quality compared to competitors' products
and services; fluctuations in real estate values and both
residential and commercial real estate markets, as well as
agricultural business conditions; demand for loans and deposits;
legislative or regulatory changes that adversely affect our
business; changes in accounting principles, policies, or
guidelines; results of regulatory examinations, including the
possibility that a regulator may, among other things, require an
increase in our reserve for loan losses or write-down of assets;
the impact of technological changes; and our success at managing
the risks involved in the foregoing. Any forward-looking statements
are based upon management’s beliefs and assumptions at the time
they are made. We undertake no obligation to publicly update or
revise any forward-looking statements or to update the reasons why
actual results could differ from those contained in such
statements, whether as a result of new information, future events
or otherwise. In light of these risks, uncertainties and
assumptions, the forward-looking statements discussed might not
occur, and you should not put undue reliance on any forward-looking
statements.
Southern Missouri Bancorp, Inc. |
UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
INFORMATION |
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Summary Balance Sheet
Data as of: |
|
Dec. 31 |
|
Sep. 30, |
|
June 30, |
|
Mar. 31, |
|
Dec. 31, |
|
(dollars in thousands, except per share data) |
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash equivalents and time
deposits |
|
$ |
150,496 |
|
|
$ |
42,850 |
|
|
$ |
55,219 |
|
|
$ |
57,078 |
|
|
$ |
42,015 |
|
|
Available for sale (AFS)
securities |
|
|
181,146 |
|
|
|
175,528 |
|
|
|
176,524 |
|
|
|
180,592 |
|
|
|
175,843 |
|
|
FHLB/FRB membership stock |
|
|
11,004 |
|
|
|
11,956 |
|
|
|
10,753 |
|
|
|
13,054 |
|
|
|
12,522 |
|
|
Loans receivable, gross |
|
|
2,156,870 |
|
|
|
2,185,547 |
|
|
|
2,167,068 |
|
|
|
1,991,328 |
|
|
|
1,943,599 |
|
|
Allowance for
loan losses |
|
|
35,471 |
|
|
|
35,084 |
|
|
|
25,139 |
|
|
|
23,508 |
|
|
|
20,814 |
|
|
Loans receivable, net |
|
|
2,121,399 |
|
|
|
2,150,463 |
|
|
|
2,141,929 |
|
|
|
1,967,820 |
|
|
|
1,922,785 |
|
|
Bank-owned life insurance |
|
|
43,268 |
|
|
|
43,644 |
|
|
|
43,363 |
|
|
|
39,095 |
|
|
|
38,847 |
|
|
Intangible assets |
|
|
21,453 |
|
|
|
21,582 |
|
|
|
21,789 |
|
|
|
21,573 |
|
|
|
22,423 |
|
|
Premises and equipment |
|
|
63,970 |
|
|
|
64,430 |
|
|
|
65,106 |
|
|
|
64,705 |
|
|
|
65,006 |
|
|
Other assets |
|
|
30,262 |
|
|
|
30,281 |
|
|
|
27,474 |
|
|
|
30,531 |
|
|
|
32,408 |
|
|
Total assets |
|
$ |
2,622,998 |
|
|
$ |
2,540,734 |
|
|
$ |
2,542,157 |
|
|
$ |
2,374,448 |
|
|
$ |
2,311,849 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits |
|
$ |
1,927,351 |
|
|
$ |
1,861,051 |
|
|
$ |
1,868,799 |
|
|
$ |
1,738,379 |
|
|
$ |
1,691,010 |
|
|
Noninterest-bearing
deposits |
|
|
337,736 |
|
|
|
307,023 |
|
|
|
316,048 |
|
|
|
233,268 |
|
|
|
223,604 |
|
|
FHLB advances |
|
|
63,286 |
|
|
|
85,637 |
|
|
|
70,024 |
|
|
|
123,361 |
|
|
|
114,646 |
|
|
Note payable |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
3,000 |
|
|
|
3,000 |
|
|
Other liabilities |
|
|
11,743 |
|
|
|
11,880 |
|
|
|
13,797 |
|
|
|
11,469 |
|
|
|
15,627 |
|
|
Subordinated debt |
|
|
15,193 |
|
|
|
15,168 |
|
|
|
15,142 |
|
|
|
15,118 |
|
|
|
15,093 |
|
|
Total
liabilities |
|
|
2,355,309 |
|
|
|
2,280,759 |
|
|
|
2,283,810 |
|
|
|
2,124,595 |
|
|
|
2,062,980 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
stockholders' equity |
|
|
267,689 |
|
|
|
259,975 |
|
|
|
258,347 |
|
|
|
249,853 |
|
|
|
248,869 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
and stockholders' equity |
|
$ |
2,622,998 |
|
|
$ |
2,540,734 |
|
|
$ |
2,542,157 |
|
|
$ |
2,374,448 |
|
|
$ |
2,311,849 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity to assets ratio |
|
|
10.21 |
% |
|
|
10.23 |
% |
|
|
10.16 |
% |
|
|
10.52 |
% |
|
|
10.76 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shares outstanding |
|
|
9,035,232 |
|
|
|
9,126,625 |
|
|
|
9,127,390 |
|
|
|
9,128,290 |
|
|
|
9,206,783 |
|
|
Less: Restricted
common shares not vested |
|
|
25,410 |
|
|
|
27,260 |
|
|
|
28,025 |
|
|
|
28,925 |
|
|
|
24,900 |
|
|
Common shares for book value
determination |
|
|
9,009,822 |
|
|
|
9,099,365 |
|
|
|
9,099,365 |
|
|
|
9,099,365 |
|
|
|
9,181,883 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per common
share |
|
$ |
29.71 |
|
|
$ |
28.57 |
|
|
$ |
28.39 |
|
|
$ |
27.46 |
|
|
$ |
27.10 |
|
|
Closing market price |
|
|
30.44 |
|
|
|
23.58 |
|
|
|
24.30 |
|
|
|
24.27 |
|
|
|
38.36 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming asset
data as of: |
|
Dec. 31 |
|
Sep. 30, |
|
June 30, |
|
Mar. 31, |
|
Dec. 31, |
|
(dollars in thousands) |
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual loans |
|
$ |
8,330 |
|
|
$ |
8,775 |
|
|
$ |
8,657 |
|
|
$ |
11,428 |
|
|
$ |
10,419 |
|
|
Accruing loans 90 days or more
past due |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1 |
|
|
Total
nonperforming loans |
|
|
8,330 |
|
|
|
8,775 |
|
|
|
8,657 |
|
|
|
11,428 |
|
|
|
10,420 |
|
|
Other real estate owned
(OREO) |
|
|
2,707 |
|
|
|
2,466 |
|
|
|
2,561 |
|
|
|
3,401 |
|
|
|
3,668 |
|
|
Personal property
repossessed |
|
|
44 |
|
|
|
9 |
|
|
|
9 |
|
|
|
38 |
|
|
|
26 |
|
|
Total
nonperforming assets |
|
$ |
11,081 |
|
|
$ |
11,250 |
|
|
$ |
11,227 |
|
|
$ |
14,867 |
|
|
$ |
14,114 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total nonperforming assets to
total assets |
|
|
0.42 |
% |
|
|
0.44 |
% |
|
|
0.44 |
% |
|
|
0.63 |
% |
|
|
0.61 |
% |
|
Total nonperforming loans to
gross loans |
|
|
0.39 |
% |
|
|
0.40 |
% |
|
|
0.40 |
% |
|
|
0.57 |
% |
|
|
0.54 |
% |
|
Allowance for loan losses to
nonperforming loans |
|
|
425.82 |
% |
|
|
399.82 |
% |
|
|
290.39 |
% |
|
|
205.71 |
% |
|
|
199.75 |
% |
|
Allowance for loan losses to
gross loans |
|
|
1.64 |
% |
|
|
1.61 |
% |
|
|
1.16 |
% |
|
|
1.18 |
% |
|
|
1.07 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing troubled debt
restructurings (1) |
|
$ |
7,897 |
|
|
$ |
7,923 |
|
|
$ |
8,580 |
|
|
$ |
14,196 |
|
|
$ |
14,814 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Nonperforming troubled debt
restructurings are included with nonaccrual loans or accruing loans
90 days or more past due. |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three-month period ended |
Quarterly Summary
Income Statement Data: |
|
Dec. 31 |
|
Sep. 30, |
|
June 30, |
|
Mar. 31, |
|
Dec. 31, |
|
(dollars in thousands, except per share data) |
|
|
2020 |
|
|
2020 |
|
|
2020 |
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income: |
|
|
|
|
|
|
|
|
|
|
|
Cash
equivalents |
|
$ |
48 |
|
$ |
41 |
|
$ |
18 |
|
$ |
33 |
|
|
$ |
31 |
|
AFS securities
and membership stock |
|
|
997 |
|
|
1,024 |
|
|
1,146 |
|
|
1,218 |
|
|
|
1,194 |
|
Loans
receivable |
|
|
26,826 |
|
|
25,907 |
|
|
26,099 |
|
|
24,969 |
|
|
|
25,421 |
|
Total interest income |
|
|
27,871 |
|
|
26,972 |
|
|
27,263 |
|
|
26,220 |
|
|
|
26,646 |
|
Interest expense: |
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
3,863 |
|
|
4,390 |
|
|
4,923 |
|
|
6,135 |
|
|
|
6,448 |
|
FHLB
advances |
|
|
347 |
|
|
380 |
|
|
398 |
|
|
439 |
|
|
|
573 |
|
Note payable |
|
|
- |
|
|
- |
|
|
11 |
|
|
31 |
|
|
|
34 |
|
Subordinated
debt |
|
|
134 |
|
|
138 |
|
|
151 |
|
|
197 |
|
|
|
214 |
|
Total interest expense |
|
|
4,344 |
|
|
4,908 |
|
|
5,483 |
|
|
6,802 |
|
|
|
7,269 |
|
Net interest income |
|
|
23,527 |
|
|
22,064 |
|
|
21,780 |
|
|
19,418 |
|
|
|
19,377 |
|
Provision for credit
losses |
|
|
612 |
|
|
774 |
|
|
1,868 |
|
|
2,850 |
|
|
|
388 |
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
|
Deposit account
charges and related fees |
|
|
1,360 |
|
|
1,339 |
|
|
1,087 |
|
|
1,538 |
|
|
|
1,632 |
|
Bank card
interchange income |
|
|
836 |
|
|
830 |
|
|
954 |
|
|
719 |
|
|
|
651 |
|
Loan late
charges |
|
|
138 |
|
|
141 |
|
|
157 |
|
|
149 |
|
|
|
121 |
|
Loan servicing
fees |
|
|
368 |
|
|
310 |
|
|
248 |
|
|
(285 |
) |
|
|
103 |
|
Other loan
fees |
|
|
305 |
|
|
327 |
|
|
290 |
|
|
370 |
|
|
|
354 |
|
Net realized
gains on sale of loans |
|
|
1,390 |
|
|
1,206 |
|
|
977 |
|
|
178 |
|
|
|
203 |
|
Earnings on bank
owned life insurance |
|
|
974 |
|
|
280 |
|
|
266 |
|
|
247 |
|
|
|
253 |
|
Other noninterest
income |
|
|
349 |
|
|
508 |
|
|
380 |
|
|
313 |
|
|
|
357 |
|
Total noninterest income |
|
|
5,720 |
|
|
4,941 |
|
|
4,359 |
|
|
3,229 |
|
|
|
3,674 |
|
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits |
|
|
7,545 |
|
|
7,720 |
|
|
7,698 |
|
|
7,521 |
|
|
|
6,993 |
|
Occupancy and
equipment, net |
|
|
1,866 |
|
|
1,970 |
|
|
1,887 |
|
|
1,780 |
|
|
|
1,769 |
|
Data processing
expense |
|
|
1,175 |
|
|
1,062 |
|
|
2,084 |
|
|
974 |
|
|
|
878 |
|
Telecommunications expense |
|
|
308 |
|
|
315 |
|
|
314 |
|
|
309 |
|
|
|
320 |
|
Deposit insurance
premiums |
|
|
218 |
|
|
201 |
|
|
155 |
|
|
- |
|
|
|
- |
|
Legal and
professional fees |
|
|
236 |
|
|
198 |
|
|
318 |
|
|
229 |
|
|
|
239 |
|
Advertising |
|
|
219 |
|
|
230 |
|
|
391 |
|
|
244 |
|
|
|
283 |
|
Postage and
office supplies |
|
|
195 |
|
|
193 |
|
|
219 |
|
|
224 |
|
|
|
178 |
|
Intangible
amortization |
|
|
338 |
|
|
380 |
|
|
448 |
|
|
441 |
|
|
|
441 |
|
Foreclosed
property expenses |
|
|
38 |
|
|
50 |
|
|
636 |
|
|
282 |
|
|
|
25 |
|
Provision for
off-balance sheet credit exposure |
|
|
388 |
|
|
226 |
|
|
132 |
|
|
300 |
|
|
|
362 |
|
Other noninterest
expense |
|
|
908 |
|
|
953 |
|
|
1,226 |
|
|
1,265 |
|
|
|
1,537 |
|
Total noninterest expense |
|
|
13,434 |
|
|
13,498 |
|
|
15,508 |
|
|
13,569 |
|
|
|
13,025 |
|
Net income before income taxes |
|
|
15,201 |
|
|
12,733 |
|
|
8,763 |
|
|
6,228 |
|
|
|
9,638 |
|
Income taxes |
|
|
3,153 |
|
|
2,747 |
|
|
1,861 |
|
|
1,129 |
|
|
|
1,921 |
|
Net income |
|
|
12,048 |
|
|
9,986 |
|
|
6,902 |
|
|
5,099 |
|
|
|
7,717 |
|
Less: Distributed
and undistributed earnings allocated |
|
|
|
|
|
|
|
|
|
|
to participating
securities |
|
|
34 |
|
|
30 |
|
|
- |
|
|
- |
|
|
|
- |
|
Net income available to common shareholders |
|
$ |
12,014 |
|
$ |
9,956 |
|
$ |
6,902 |
|
$ |
5,099 |
|
|
$ |
7,717 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common
share |
|
$ |
1.33 |
|
$ |
1.09 |
|
$ |
0.76 |
|
$ |
0.55 |
|
|
$ |
0.84 |
|
Diluted earnings per common
share |
|
|
1.32 |
|
|
1.09 |
|
|
0.76 |
|
|
0.55 |
|
|
|
0.84 |
|
Dividends per common
share |
|
|
0.15 |
|
|
0.15 |
|
|
0.15 |
|
|
0.15 |
|
|
|
0.15 |
|
Average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
9,064,000 |
|
|
9,100,000 |
|
|
9,128,000 |
|
|
9,197,000 |
|
|
|
9,202,000 |
|
Diluted |
|
|
9,067,000 |
|
|
9,102,000 |
|
|
9,130,000 |
|
|
9,205,000 |
|
|
|
9,213,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three-month period ended |
Quarterly Average
Balance Sheet Data: |
|
Dec. 31 |
|
Sep. 30, |
|
June 30, |
|
Mar. 31, |
|
Dec. 31, |
|
(dollars in thousands) |
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing cash
equivalents |
|
$ |
40,915 |
|
|
$ |
19,768 |
|
|
$ |
10,380 |
|
|
$ |
7,363 |
|
|
$ |
6,322 |
|
|
AFS securities and membership
stock |
|
|
184,828 |
|
|
|
181,535 |
|
|
|
188,497 |
|
|
|
184,389 |
|
|
|
183,748 |
|
|
Loans receivable, gross |
|
|
2,177,989 |
|
|
|
2,162,125 |
|
|
|
2,127,181 |
|
|
|
1,950,887 |
|
|
|
1,903,230 |
|
|
Total
interest-earning assets |
|
|
2,403,732 |
|
|
|
2,363,428 |
|
|
|
2,326,058 |
|
|
|
2,142,639 |
|
|
|
2,093,300 |
|
|
Other assets |
|
|
170,158 |
|
|
|
174,574 |
|
|
|
194,651 |
|
|
|
180,981 |
|
|
|
184,028 |
|
|
Total assets |
|
$ |
2,573,890 |
|
|
$ |
2,538,002 |
|
|
$ |
2,520,709 |
|
|
$ |
2,323,620 |
|
|
$ |
2,277,328 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits |
|
$ |
1,886,883 |
|
|
$ |
1,865,636 |
|
|
$ |
1,838,606 |
|
|
$ |
1,729,327 |
|
|
$ |
1,674,198 |
|
|
FHLB advances |
|
|
69,991 |
|
|
|
70,272 |
|
|
|
83,130 |
|
|
|
83,916 |
|
|
|
99,728 |
|
|
Note payable |
|
|
- |
|
|
|
- |
|
|
|
1,187 |
|
|
|
3,000 |
|
|
|
3,000 |
|
|
Subordinated debt |
|
|
15,180 |
|
|
|
15,155 |
|
|
|
15,130 |
|
|
|
15,105 |
|
|
|
15,080 |
|
|
Total
interest-bearing liabilities |
|
|
1,972,054 |
|
|
|
1,951,063 |
|
|
|
1,938,053 |
|
|
|
1,831,348 |
|
|
|
1,792,006 |
|
|
Noninterest-bearing
deposits |
|
|
325,091 |
|
|
|
316,996 |
|
|
|
311,555 |
|
|
|
223,865 |
|
|
|
222,187 |
|
|
Other noninterest-bearing
liabilities |
|
|
13,021 |
|
|
|
14,673 |
|
|
|
15,937 |
|
|
|
17,634 |
|
|
|
17,533 |
|
|
Total
liabilities |
|
|
2,310,166 |
|
|
|
2,282,732 |
|
|
|
2,265,545 |
|
|
|
2,072,847 |
|
|
|
2,031,726 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
stockholders' equity |
|
|
263,724 |
|
|
|
255,270 |
|
|
|
255,164 |
|
|
|
250,773 |
|
|
|
245,602 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
and stockholders' equity |
|
$ |
2,573,890 |
|
|
$ |
2,538,002 |
|
|
$ |
2,520,709 |
|
|
$ |
2,323,620 |
|
|
$ |
2,277,328 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets |
|
|
1.87 |
% |
|
|
1.57 |
% |
|
|
1.10 |
% |
|
|
0.88 |
% |
|
|
1.36 |
% |
|
Return on average common
stockholders' equity |
|
|
18.3 |
% |
|
|
15.6 |
% |
|
|
10.8 |
% |
|
|
8.1 |
% |
|
|
12.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest margin |
|
|
3.92 |
% |
|
|
3.73 |
% |
|
|
3.75 |
% |
|
|
3.63 |
% |
|
|
3.70 |
% |
|
Net interest spread |
|
|
3.76 |
% |
|
|
3.55 |
% |
|
|
3.56 |
% |
|
|
3.40 |
% |
|
|
3.47 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency ratio |
|
|
45.9 |
% |
|
|
50.0 |
% |
|
|
59.3 |
% |
|
|
59.9 |
% |
|
|
56.5 |
% |
|
|
As of December 31, 2020 |
|
As of September 30, 2020 |
|
Loan portfolio
balances and CARES Act modifications |
Balance |
|
Payment |
|
Interest-only |
|
Payment |
|
Interest-only |
|
(dollars in thousands) |
Outstanding |
|
Deferrals |
|
Modifications |
|
Deferrals |
|
Modifications |
|
|
|
|
|
|
|
|
|
|
|
|
1- to 4-family residential
loans |
$ |
438,156 |
|
$ |
- |
|
$ |
138 |
|
$ |
1,171 |
|
$ |
8,805 |
|
Multifamily residential
loans |
|
198,534 |
|
|
- |
|
|
10,581 |
|
|
- |
|
|
12,278 |
|
Total residential
loans |
|
636,690 |
|
|
- |
|
|
10,719 |
|
|
1,171 |
|
|
21,083 |
|
1- to 4-family owner-occupied
construction loans |
|
23,380 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
1- to 4-family speculative
construction loans |
|
10,567 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Multifamily construction
loans |
|
50,495 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Other construction loans |
|
28,552 |
|
|
- |
|
|
- |
|
|
4,367 |
|
|
- |
|
Total construction loan
balances drawn |
|
112,994 |
|
|
- |
|
|
- |
|
|
4,367 |
|
|
- |
|
Agricultural real estate
loans |
|
185,811 |
|
|
- |
|
|
- |
|
|
1,967 |
|
|
1,415 |
|
Loans for vacant land -
developed, undeveloped, and other purposes |
|
55,117 |
|
|
- |
|
|
- |
|
|
- |
|
|
1,203 |
|
Owner-occupied commercial real
estate loans to: |
|
|
|
|
|
|
|
|
|
|
Churches and nonprofits |
|
21,626 |
|
|
- |
|
|
634 |
|
|
- |
|
|
1,449 |
|
Non-professional services |
|
15,507 |
|
|
- |
|
|
- |
|
|
- |
|
|
2,106 |
|
Retail |
|
26,234 |
|
|
- |
|
|
- |
|
|
- |
|
|
1,257 |
|
Automobile dealerships |
|
18,294 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Healthcare providers |
|
7,715 |
|
|
- |
|
|
- |
|
|
- |
|
|
330 |
|
Restaurants |
|
46,208 |
|
|
- |
|
|
- |
|
|
- |
|
|
5,694 |
|
Convenience stores |
|
20,285 |
|
|
- |
|
|
- |
|
|
- |
|
|
1,303 |
|
Automotive services |
|
5,141 |
|
|
- |
|
|
- |
|
|
- |
|
|
244 |
|
Manufacturing |
|
12,492 |
|
|
- |
|
|
- |
|
|
- |
|
|
7,262 |
|
Professional services |
|
12,734 |
|
|
- |
|
|
- |
|
|
- |
|
|
354 |
|
Warehouse/distribution |
|
4,718 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Grocery |
|
5,443 |
|
|
- |
|
|
- |
|
|
- |
|
|
26 |
|
Other |
|
46,430 |
|
|
- |
|
|
816 |
|
|
- |
|
|
551 |
|
Total owner-occupied commercial real estate loans |
|
242,827 |
|
|
- |
|
|
1,450 |
|
|
- |
|
|
20,576 |
|
Non-owner-occupied commercial
real estate loans to: |
|
|
|
|
|
|
|
|
|
|
Care facilities |
|
35,302 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Non-professional services |
|
12,243 |
|
|
- |
|
|
- |
|
|
- |
|
|
3,864 |
|
Retail |
|
27,206 |
|
|
- |
|
|
- |
|
|
545 |
|
|
525 |
|
Healthcare providers |
|
14,279 |
|
|
- |
|
|
- |
|
|
- |
|
|
442 |
|
Restaurants |
|
46,631 |
|
|
- |
|
|
- |
|
|
- |
|
|
413 |
|
Convenience stores |
|
14,928 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Automotive services |
|
5,401 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Hotels |
|
85,222 |
|
|
- |
|
|
28,092 |
|
|
- |
|
|
3,495 |
|
Manufacturing |
|
4,998 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Storage units |
|
14,154 |
|
|
- |
|
|
- |
|
|
- |
|
|
404 |
|
Professional services |
|
8,732 |
|
|
- |
|
|
- |
|
|
- |
|
|
460 |
|
Multi-tenant retail |
|
73,026 |
|
|
- |
|
|
- |
|
|
- |
|
|
14,872 |
|
Warehouse/distribution |
|
25,847 |
|
|
- |
|
|
- |
|
|
- |
|
|
2,953 |
|
Other |
|
50,840 |
|
|
- |
|
|
- |
|
|
- |
|
|
4,218 |
|
Total non-owner-occupied commercial real estate loans |
|
418,809 |
|
|
- |
|
|
28,092 |
|
|
545 |
|
|
31,646 |
|
Total commercial real
estate |
|
902,564 |
|
|
- |
|
|
29,542 |
|
|
2,512 |
|
|
54,840 |
|
|
As of December 31, 2020 |
|
As of September 30, 2020 |
|
Loan portfolio
balances and CARES Act modifications |
Balance |
|
Payment |
|
Interest-only |
|
Payment |
|
Interest-only |
|
(continued, dollars in thousands) |
Outstanding |
|
Deferrals |
|
Modifications |
|
Deferrals |
|
Modifications |
|
|
|
|
|
|
|
|
|
|
|
|
Home equity lines of
credit |
|
40,729 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Deposit-secured loans |
|
5,001 |
|
|
- |
|
|
- |
|
|
- |
|
|
1 |
|
All other consumer loans |
|
33,860 |
|
|
- |
|
|
- |
|
|
83 |
|
|
92 |
|
Total consumer
loans |
|
79,590 |
|
|
- |
|
|
- |
|
|
83 |
|
|
93 |
|
Agricultural production and
equipment loans |
|
99,281 |
|
|
- |
|
|
- |
|
|
351 |
|
|
84 |
|
Loans to municipalities or
other public units |
|
9,684 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Commercial and industrial
loans to: |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Forestry, fishing, and hunting |
|
13,890 |
|
|
- |
|
|
- |
|
|
- |
|
|
364 |
|
Construction |
|
24,788 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Finance and insurance |
|
56,040 |
|
|
- |
|
|
- |
|
|
- |
|
|
20 |
|
Real estate rental and leasing |
|
20,707 |
|
|
- |
|
|
- |
|
|
- |
|
|
54 |
|
Healthcare and social assistance |
|
29,909 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Accommodations and food services |
|
30,318 |
|
|
- |
|
|
- |
|
|
- |
|
|
707 |
|
Manufacturing |
|
11,828 |
|
|
- |
|
|
- |
|
|
- |
|
|
3,097 |
|
Retail trade |
|
41,655 |
|
|
- |
|
|
- |
|
|
- |
|
|
874 |
|
Transportation and warehousing |
|
33,601 |
|
|
- |
|
|
11 |
|
|
- |
|
|
3,071 |
|
Professional services |
|
6,611 |
|
|
- |
|
|
- |
|
|
- |
|
|
12 |
|
Administrative support and waste management |
|
9,892 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Arts, entertainment, and recreation |
|
3,862 |
|
|
- |
|
|
- |
|
|
585 |
|
|
27 |
|
Other commercial loans |
|
35,279 |
|
|
- |
|
|
- |
|
|
8 |
|
|
238 |
|
Total commercial and industrial loans |
|
318,380 |
|
|
- |
|
|
11 |
|
|
593 |
|
|
8,464 |
|
Total commercial
loans |
|
427,345 |
|
|
- |
|
|
11 |
|
|
944 |
|
|
8,548 |
|
Total
gross loans receivable, excluding deferred loan fees |
$ |
2,159,183 |
|
$ |
- |
|
$ |
40,272 |
|
$ |
9,077 |
|
$ |
84,564 |
|
Matt Funke
573-778-1800
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