The Community Financial Corporation (NASDAQ: TCFC) (the “Company”),
the holding company for Community Bank of the Chesapeake (the
“Bank”), today reported its results of operations for the three and
six months ended June 30, 2021. Net income for the three
months ended June 30, 2021 was $6.4 million, or $1.10 per
diluted common share compared with net income of $6.3 million, or
$1.07 per diluted common share for the first quarter of 2021, and
net income of $3.5 million or $0.59 per diluted common share for
the quarter ended June 30, 2020. The Company reported net
income for the six months ended June 30, 2021 of $12.7 million
or diluted earnings per share of $2.17 compared to a net income for
the comparable period of 2020 of $6.2 million or diluted earnings
per share of $1.05. As a result of the COVID-19 pandemic, earnings
for the six months ended June 30, 2020 were impacted by an
increased provision for loan losses ("PLL") of $7.6 million
compared to $0.6 million for the six months ended June 30,
2021.
Management Commentary
"During the three months ended June 30,
2021, we delivered our third consecutive quarter of record
performance. In the first six months of 2021, we added two new
product lines, closed a branch to better optimize our branch
operations, improved asset quality and continued to drive operating
efficiency by controlling expenses," stated William J. Pasenelli,
Chief Executive Officer. "Our second quarter 2021 operating results
were strong at a 1.22% ROAA. We believe that without U.S. Small
Business Administration Paycheck Protection Program ("U.S. SBA
PPP") income, ROAA would be lower by 10 to 12 basis points. We
believe as we look forward that we have positioned our Company with
a healthy balance sheet and a foundation for sustainable profitable
operations that should enhance long-term shareholder value beyond
the non-recurring income streams from the U.S. SBA PPP".
“Our business development teams continue to be
successful sourcing noninterest-bearing accounts by returning to
face to face interactions with customers and by leveraging
technology and Fintech partnerships to better understand our
customers' behaviors. In addition, we are taking advantage of
market disintermediation as well as new customers acquired through
COVID-19 government stimulus programs,” stated James M. Burke,
President. "New account openings in the first half of the year have
included a mix of retail and commercial accounts and have
significantly exceeded the number of accounts we opened for new
customers participating in the U.S. SBA PPP loan program. The
increases in the numbers and dollars of noninterest-bearing
accounts, from 20.74% of outstanding deposit balances at year end
to 22.18% at June 30, 2021, provide a strong foundation for
continued fee income improvement as well as help offset margin
compression in the current volatile interest rate environment."
During March 2021, the Bank introduced a new
residential mortgage program and retail and commercial credit card
program that merge the technology and expertise of two proven
FinTech firms with our business development team's demonstrated
capabilities. The Company expects these programs to improve
non-interest income and interest income in 2022-2023.
The Bank’s expansion into Virginia significantly
contributed to our growth over the last five years. Fredericksburg,
Spotsylvania and surrounding areas provide significant
opportunities for continued organic growth supported by our
efficient operating model and ability to leverage technology. At
June 30, 2021, loans in the greater Fredericksburg, Virginia
area accounted for approximately 40% of the Bank's outstanding
portfolio loans, and Fredericksburg branch deposits were
$84.7 million with an average cost of deposits of four basis
points. On April 21, 2021, the Bank purchased its second location
in Virginia at 5831 Plank Road, Spotsylvania. The full-service
branch is expected to open in late 2021 and will provide banking,
lending and wealth management services with a focus on digital
banking.
Effective March 31, 2021, the Bank consolidated
its St. Patrick's Drive branch in Waldorf, Maryland into the Bank's
nearby main office branch. This realignment of our branches will
enable the Company to serve a wider customer base. The net
financial impact of the new Spotsylvania branch and the closing of
the St. Patrick's Drive branch is expected to be neutral to the
Company's expense run rate.
As previously disclosed on July 15, 2021, the
Company completed the repurchase of the $7.0 million of shares
of the Company’s common stock pursuant to the repurchase plan
announced on October 20, 2020 (the “2020 Repurchase Plan”). The
2020 Repurchase Plan authorized the Company to repurchase up to
300,000 of the Company’s outstanding shares of common stock using
up to $7.0 million of the proceeds the Company raised in its
$20.0 million subordinated debt offering completed in October
2020. Between November 2020 and July 2021, 200,275 shares were
purchased at a total cost of approximately $6.98 million or an
average of $34.83 per share. As of July 15, 2021, the Company had
5,715,732 shares outstanding. The Company will continue to evaluate
the use of additional capital management strategies to enhance
overall shareholder value, including repurchasing some or all of
the 99,725 shares remaining under the 2020 Repurchase Plan. Future
plans to resume repurchases will be publicly announced.
Results of Operations
| |
|
(UNAUDITED) |
|
|
|
|
| |
|
Three Months Ended June 30, |
|
|
|
|
|
(dollars in thousands) |
|
2021 |
|
2020 |
|
$ Change |
|
% Change |
|
Interest and dividend income |
|
$ |
17,444 |
|
|
$ |
17,638 |
|
|
$ |
(194 |
) |
|
(1.1 |
) |
% |
| Interest expense |
|
1,009 |
|
|
2,414 |
|
|
(1,405 |
) |
|
(58.2 |
) |
% |
| Net interest income |
|
16,435 |
|
|
15,224 |
|
|
1,211 |
|
|
8.0 |
|
% |
| Provision for loan losses |
|
291 |
|
|
3,500 |
|
|
(3,209 |
) |
|
(91.7 |
) |
% |
| Noninterest income |
|
1,856 |
|
|
2,259 |
|
|
(403 |
) |
|
(17.8 |
) |
% |
| Noninterest expense |
|
9,378 |
|
|
9,397 |
|
|
(19 |
) |
|
(0.2 |
) |
% |
| Income before income
taxes |
|
8,622 |
|
|
4,586 |
|
|
4,036 |
|
|
88.0 |
|
% |
| Income tax expense |
|
2,190 |
|
|
1,136 |
|
|
1,054 |
|
|
92.8 |
|
% |
| Net income |
|
$ |
6,432 |
|
|
$ |
3,450 |
|
|
$ |
2,982 |
|
|
86.4 |
|
% |
| |
|
(UNAUDITED) |
|
|
|
|
| |
|
Six Months Ended June 30, |
|
|
|
|
|
(dollars in thousands) |
|
2020 |
|
2019 |
|
$ Change |
|
% Change |
|
Interest and dividend income |
|
$ |
35,122 |
|
|
$ |
35,677 |
|
|
$ |
(555 |
) |
|
(1.6 |
) |
% |
| Interest expense |
|
2,178 |
|
|
6,100 |
|
|
(3,922 |
) |
|
(64.3 |
) |
% |
| Net interest income |
|
32,944 |
|
|
29,577 |
|
|
3,367 |
|
|
11.4 |
|
% |
| Provision for loan losses |
|
586 |
|
|
7,600 |
|
|
(7,014 |
) |
|
(92.3 |
) |
% |
| Noninterest income |
|
4,216 |
|
|
4,380 |
|
|
(164 |
) |
|
(3.7 |
) |
% |
| Noninterest expense |
|
19,526 |
|
|
19,080 |
|
|
446 |
|
|
2.3 |
|
% |
| Income before income
taxes |
|
17,048 |
|
|
7,277 |
|
|
9,771 |
|
|
134.3 |
|
% |
| Income tax expense |
|
4,317 |
|
|
1,079 |
|
|
3,238 |
|
|
300.1 |
|
% |
| Net income |
|
$ |
12,731 |
|
|
$ |
6,198 |
|
|
$ |
6,533 |
|
|
105.4 |
|
% |
Net Interest Income
Net interest income increased for the three
months ended June 30, 2021 compared to the three months ended
June 30, 2020. Net interest margin of 3.37% for the three
months ended June 30, 2021 increased three basis points from
3.34% for the comparable period. The increase in net interest
income resulted primarily from decreases in interest expense from
lower funding costs exceeding the impacts of lower interest-earning
asset repricing.
Net interest income increased for the
six months ended June 30, 2021 compared to the
six months ended June 30, 2020. Net interest margin of
3.43% for the six months ended June 30, 2021 was four basis
points higher than the 3.39% for the six months ended June 30,
2020. The increase in net interest income resulted primarily from
decreases in interest expense from lower funding costs exceeding
the impacts of lower interest-earning asset repricing. Interest
earning asset yields decreased 42 basis points from 4.08% for the
six months ended June 30, 2020 to 3.66% for the six months
ended June 30, 2021. The Company’s cost of funds decreased 49
basis points from 0.72% for the six months ended June 30, 2020
to 0.23% for the six months ended June 30, 2021.
For the second quarter and first six months of
2021, interest income decreased from significantly lower asset
yields partially offset by increased interest income from larger
average balances and accelerated loan fee recognition following the
forgiveness of U.S. SBA PPP loans. Interest income from the
Company's participation in the U.S. SBA PPP program was $1.3
million and $3.1 million for the three and six months ended
June 30, 2021 compared to $0.5 million and $0.5 million for
the three and six months ended June 30, 2020. For the three
and six months ended June 30, 2021, net interest margin
increased 10 and 13 basis points as a result of net U.S. SBA PPP
loan interest income and accelerated loan fee recognition compared
to an increase of two basis points and no impact for the comparable
periods in 2020. For the three months ended March 31, 2021,
net interest margin of 3.50% increased 18 basis points as result of
net U.S. SBA PPP loan interest income.
Due to a slightly liability-sensitive balance
sheet, the Company's net interest margin was stable in 2020 after
adjusting for U.S. SBA PPP loan and funding activity. The sharp
decline in interest rates in 2020 and 2021 not only reduced
interest income on floating-rate loans, liquid interest-earning
assets and investments, but has also reduced competitive pressures
and depositor expectations concerning deposit interest rates. The
Company’s cost of funds continued to decrease during the second
quarter of 2021. The prepayment of $30.0 million of FHLB
advances with a 2.2% average rate in the last six months of 2020,
the repricing of time deposits, the increase in noninterest-bearing
accounts as a percentage of total deposits and lower costs for
transaction deposit accounts all contributed to lowering the Bank's
cost of funds in 2020 and 2021. Cost of funds decreased from 0.54%
for the three months ended June 30, 2020 to 0.21% for the
three months ended June 30, 2021. During the second quarter of
2021, the Company's cost of funds decreased four basis points from
0.25% for the three months ended March 31, 2021.
Excluding the acceleration of interest income
with U.S. SBA PPP loan forgiveness, compression of our net interest
margin is likely to continue in the third quarter of 2021 as
interest-earning assets reprice faster than interest-bearing
liabilities and the Bank continues to invest excess liquidity into
securities. We expect U.S. SBA PPP loan forgiveness to positively
impact margins and net interest income in the third and fourth
quarters of 2021 with the recognition of remaining net deferred
fees.
Noninterest Income
Noninterest income decreased for the three
months ended June 30, 2021 compared to the three months ended
June 30, 2020. The decrease for the comparable periods was
primarily due to lower interest rate protection referral fee income
and gains on the sale of investment securities in the second
quarter of 2020, partially offset by increased fees on customer
accounts. Noninterest income as a percentage of assets was 0.35%
and 0.45%, respectively, for the three months ended June 30,
2021 and 2020.
Noninterest income decreased for the
six months ended June 30, 2021 compared to the
six months ended June 30, 2020. The decrease was
primarily due to decreased interest rate protection referral fee
income and a loss on the sale of impaired loans partially offset by
increased service charges and miscellaneous fees. During the
quarter ended March 31, 2021, the Bank sold non-accrual and
classified commercial real estate and residential mortgage loans
with an amortized cost, net of charge-offs, of $9.1 million
and recognized a loss on the sale of $191,000. Noninterest income
as a percentage of assets was 0.40% and 0.46%, respectively, for
the six months ended June 30, 2021 and 2020.
Noninterest Expense
Noninterest expense for the three months ended
June 30, 2021, was flat compared to the three months ended
June 30, 2020 as increased compensation and benefits and
professional fees were offset by decreased OREO expenses and FDIC
insurance. Compensation and benefits increased for the comparable
periods as no costs were deferred for the origination of PPP loans
in the second quarter of 2021 compared with the deferral of
$0.4 million in the second quarter of 2020. FDIC insurance has
decreased due to improved balance sheet credit trends. The
Company's projected quarterly expense run rate for the third
quarter of 2021 remains between $9.1 and $9.3 million.
The Company’s efficiency ratio was 51.27% for
the three months ended June 30, 2021 compared to 53.75% for
the three months ended June 30, 2020. The Company’s net
operating expense ratio was 1.42% for the three months ended
June 30, 2021 compared to 1.43% for the three months ended
June 30, 2020. The efficiency and net operating expense ratios
have improved (decreased) as the Company has been able to generate
more noninterest income while controlling expense growth.
During the first quarter of 2021, the Company
reported an expense of $1.3 million related to an isolated
wire transfer fraud incident. Our investigation has found no
evidence that information systems of the Bank were compromised or
that employee fraud was involved. In the second quarter of 2021,
the Company recovered $0.1 million of the funds transferred
and submitted an insurance claim which could result in a recovery
of a portion of the expense. Any recovery of insurance proceeds
would be recognized in the quarter received.
Noninterest expense increased $0.4 million
or 2.3% for the six months ended June 30, 2021 compared to the
six months ended June 30, 2020. The increase in noninterest
expense for the comparable periods was primarily due to the
$1.3 million wire fraud reported in the first quarter,
increases in professional fees and a small increase in compensation
and benefits due to fewer deferred costs allocated for PPP loans.
Year to date compensation and benefits for the six months ended
June 30, 2021 and 2020 were reduced $0.25 million and
$0.40 million for the allocation of deferred costs for U.S.
SBA PPP loans originated. The increase in noninterest expense was
primarily offset by a reduction in OREO expenses. OREO expenses
have moderated as the Bank has reduced foreclosed assets over the
last 12 months from $3.7 million at June 30, 2020 to
$1.5 million at June 30, 2021.
The Company’s efficiency ratio was 52.55% for
the six months ended June 30, 2021 compared to 56.19% for the
six months ended June 30, 2020. The Company’s net
operating expense ratio was 1.46% at June 30,
2021 compared to 1.55% at June 30, 2020. The
efficiency and net operating expense ratios have improved
(decreased) as the Company has been able to generate more
noninterest income while controlling expense growth.
Income Tax Expense
For the three and six months ended June 30,
2021 the effective tax rate was 25.4% and 25.3%. The Company’s
consolidated effective tax rate was 24.8% and 14.8% for the three
and six months ended June 30, 2020. The Company's new state
apportionment approach was implemented during the first quarter of
2020 and included the impact of amended income tax filings of the
Company and the Bank. Management evaluated the tax position and
determined the change in tax position qualified as a change in
estimate under FASB ASC Section 250. The following table shows a
breakdown of income tax expense for the six months ended
June 30, 2020 split between the apportionment adjustment and a
normalized 2020 income tax provision:
| |
|
(UNAUDITED) |
| |
|
Six Months Ended June 30, 2020 |
|
(dollars in thousands) |
|
Tax Provision |
|
Effective Tax Rate |
|
Income tax apportionment adjustment |
|
$ |
(743 |
) |
|
(10.2 |
) |
% |
| Income taxes before
apportionment adjustment |
|
1,822 |
|
|
25.0 |
|
% |
| Income tax expense as
reported |
|
$ |
1,079 |
|
|
14.8 |
|
% |
| |
|
|
|
|
| Income before income
taxes |
|
$ |
7,277 |
|
|
|
Balance Sheet
Assets
Total assets increased $168.6 million, or 8.3%,
to $2.20 billion at June 30, 2021 compared to total assets of
$2.03 billion at December 31, 2020 primarily due to increased
cash of $61.8 million and investments of $100.8 million. The
increase in cash and investments was principally driven by the cash
received from the SBA from the forgiveness of U.S. SBA PPP loans,
as well as an increase to our customer deposits accounts. In
addition, net loans increased $8.3 million. The Company’s loan
pipeline was $154.7 million at June 30, 2021.
During the second quarter of 2021, total net
loans, which include portfolio loans and U.S. SBA PPP loans,
increased $0.1 million to $1,602.4 million at June 30, 2021.
Gross portfolio loans increased 7.1% annualized or $26.7
million from $1,507.2 million at March 31, 2021 to
$1,533.9 million at June 30, 2021. Portfolio loans
include all loan portfolios except the U.S. SBA PPP loan
portfolio.
Non-owner occupied commercial real estate as a
percentage of risk-based capital at June 30, 2021 and
December 31, 2020 were $770 million or 329% and $696 million
or 316%, respectively. Construction loans as a percentage of
risk-based capital at June 30, 2021 and December 31, 2020
were $114 million or 49% and $139 million or 63%,
respectively.
Funding
The Bank uses retail deposits and wholesale
funding. Retail deposits continue to be the most significant source
of funds totaling $1,900.1 million or 98.2% of funding at
June 30, 2021 compared to $1,737.6 million or 98.0% of funding
at December 31, 2020. Wholesale funding, which consisted of
FHLB advances and brokered deposits, were $35.3 million or 1.8% of
funding at June 30, 2021 compared to $35.3 million or 2.0% of
funding at December 31, 2020.
Total deposits increased $162.5 million
or 9.3% (18.6% annualized) at June 30, 2021 compared
to December 31, 2020. The increase reflected a $175.0 million
increased to transaction deposits offsetting a $12.5 million
decreased to time deposits. Non-interest-bearing demand deposits
increased $61.1 million or 16.9% at June 30, 2021,
representing 22.2% of deposits, compared to 20.7% of
deposits at December 31, 2020. Customer deposit balances
have increased during the last 12 months due to customer
acquisition as well as lower levels of consumer and business
spending related to the COVID-19 pandemic.
Stockholders' Equity and Regulatory
Capital
During the six months ended June 30, 2021,
total stockholders’ equity increased $5.9 million due to net income
of $12.7 million and $0.4 million in connection with
stock-based compensation and ESOP activity. These increases to
equity were partially offset by common stock repurchases of
$4.2 million, common dividends paid of $1.5 million and a
decrease in accumulated other comprehensive income of
$1.4 million due to a reduction in unrealized gains in the
investment portfolio.
The Company's common equity to assets ratio
decreased to 9.29% at June 30, 2021 from 9.77%
at December 31, 2020. The Company’s ratio of
tangible common equity ("TCE") to tangible assets decreased to
8.79% at June 30, 2021 from 9.22%
at December 31, 2020 (see Non-GAAP reconciliation
schedules). The decrease in the TCE ratio is due primarily to
significant increases in cash, investments and loans.
In April 2020, banking regulators issued an
interim final rule that excluded U.S. SBA PPP loans pledged under
the Paycheck Protection Program Liquidity Facility ("PPPLF")
from the calculation of the leverage ratio. The Bank did not have
any PPPLF advances at June 30, 2021 and December 31,
2020. In addition, the interim final rule excluded U.S. SBA PPP
loans from the calculation of risk-based capital ratios by
assigning a zero percent risk weight. The Company remains well
capitalized at June 30, 2021 with a Tier
1 capital to average assets ("leverage ratio")
of 9.57% at June 30, 2021 compared to
9.56% at December 31, 2020.
Asset Quality
Allowance for loan losses ("ALLL") and
provision for loan losses ("PLL") and Non-Performing
Assets
The Company's allowance methodology considers
quantitative historical loss factors and qualitative factors to
determine the estimated level of incurred losses in the Company's
loan portfolios. The ALLL increased in 2020 primarily due to the
economic effects of the COVID-19 pandemic and continues to provide
for economic uncertainty. ALLL levels decreased to 1.20% of
portfolio loans at June 30, 2021 compared to 1.29% at
December 31, 2020. At and for the three months ended
June 30, 2021, the Company's ALLL decreased $0.9 million or
4.7% to $18.5 million at June 30, 2021 from $19.4 million at
December 31, 2020.
The Company recorded $0.6 million of PLL for the
six months ended June 30, 2021 compared to $7.6 million for
the six months ended months ended June 30, 2020. Net
charge-offs also decreased for the comparable periods from $2.2
million in the first six months of 2020 to $1.5 million for the six
months ended June 30, 2021.
The Company's general allowance decreased from
$18.1 million at December 31, 2020 to $17.7 million at
June 30, 2021. The decrease in the general allowance was
primarily due to improvements in qualitative factors partially
offset by higher charge-offs in the first six months of 2021.
During the six months ended months ended June 30, 2021, the
Bank sold non-accrual and classified commercial real estate and
residential mortgage loans with an amortized cost of
$9.1 million, net of charge-offs of $1.4 million, and
recognized a loss on the sale of $191,000. The Company's sale of
these impaired loans decreased the specific reserve, improved asset
quality and improved several ALLL qualitative factors.
Management believes that loans included in the
COVID-19 deferral program in 2020 and 2021 are more likely to
default in the future and that the identification and resolution of
problem credits could be delayed. In our evaluation of current and
previously deferred loans, we considered the length of the deferral
period, the type and amount of collateral and customer industries.
Consistent with regulatory guidance, if new information during the
deferral period indicates that there is evidence of default, the
Bank may change the classification rating (e.g., change from
passing credit to substandard) and accrual status (e.g., change
from accrual to non-accrual status) as deemed appropriate. As of
June 30, 2021, $3.5 million or 0.2% of gross portfolio loans
had deferral agreements, a decrease of $31.9 million from the
$35.4 million or 2.4% of gross portfolio loans at
December 31, 2020. As of June 30, 2021 and
December 31, 2020, there were no loans and $3.4 million
of COVID-19 deferred loans deemed to be non-accrual and substandard
based on reviews.
Gross U.S. SBA PPP loans at June 30, 2021
totaled $89.1 million and 654 loans, a decrease of $21.2 million
compared to December 31, 2020. No credit issues are
anticipated with U.S. SBA PPP loans as they are guaranteed by the
SBA and the Bank's allowance for loan loss does not include an
allowance for U.S. SBA PPP loans.
Management believes that the allowance is
adequate at June 30, 2021.
During 2020, classified assets decreased
$12.3 million. The sale of $9.1 million in impaired loans
during the first quarter of 2021 reflects management's intent to
expeditiously resolve non-performing or substandard credits that
are not likely to become performing or passing credits in a
reasonable timeframe. Classified assets decreased $7.4 million from
$22.4 million at December 31, 2020 to $14.9 million
at June 30, 2021. Management considers classified
assets to be an important measure of asset quality. The Company's
risk rating process for classified loans is an important input into
the Company's allowance methodology. Risk ratings are expected to
be an important indicator in assessing ongoing credit risks of
COVID-19 deferred loans.
Non-accrual loans and OREO to total gross
portfolio loans and OREO decreased 42 basis points from
1.42% at December 31, 2020 to 1.00%
at June 30, 2021. Non-accrual loans, OREO and TDRs to
total assets decreased 36 basis points from
1.08% at December 31, 2020 to 0.72%
at June 30, 2021.
Non-accrual loans decreased $4.4 million from
$18.2 million at December 31, 2020 to $13.8 million at
June 30, 2021. Non-accrual loans of $8.0 million (58%) were
current with all payments of principal and interest with specific
reserves of $42,000 at June 30, 2021. Delinquent non-accrual
loans were $5.8 million (42%) with specific reserves of $0.7
million at June 30, 2021. The OREO balance decreased
$1.6 million from $3.1 million at December 31, 2020 to
$1.5 million at June 30, 2021.
About The Community Financial
Corporation - Headquartered in Waldorf, MD, The Community
Financial Corporation is the bank holding company for Community
Bank of the Chesapeake, a full-service commercial bank with assets
of approximately $2.2 billion. Through its branch offices and
commercial lending centers, Community Bank of the Chesapeake offers
a broad range of financial products and services to individuals and
businesses. The Company’s branches are located at its main office
in Waldorf, Maryland, and branch offices in Bryans Road, Dunkirk,
Leonardtown, La Plata, Charlotte Hall, Prince Frederick, Lusby and
California, Maryland; and downtown Fredericksburg, Virginia. More
information about Community Bank of the Chesapeake can be found at
www.cbtc.com.
Use of non-GAAP Financial
Measures - Statements included in this press release
include non-GAAP financial measures and should be read along with
the accompanying tables, which provide a reconciliation of non-GAAP
financial measures to GAAP financial measures. The Company’s
management uses these non-GAAP financial measures, and believes
that non-GAAP financial measures provide additional useful
information that allows readers to evaluate the ongoing performance
of the Company. Non-GAAP financial measures should not be
considered as an alternative to any measure of performance or
financial condition as promulgated under GAAP, and investors should
consider the Company’s performance and financial condition as
reported under GAAP and all other relevant information when
assessing the performance or financial condition of the Company.
Non-GAAP financial measures have limitations as analytical tools,
and investors should not consider them in isolation or as a
substitute for analysis of the results or financial condition as
reported under GAAP.
Forward-looking Statements -
This news release contains forward-looking statements within the
meaning of the federal securities laws. Forward-looking statements
can generally be identified by the fact that they do not relate
strictly to historical or current facts. They often include words
like “believe,” “expect,” “anticipate,” “estimate” and “intend” or
future or conditional verbs such as “will,” “would,” “should,”
“could” or “may.” Statements in this release that are not strictly
historical are forward-looking and are based upon current
expectations that may differ materially from actual results. These
forward-looking statements include, without limitation, those
relating to the Company’s and the Bank’s future growth and
management’s outlook or expectations for revenue, assets, asset
quality, profitability, business prospects, net interest margin,
non-interest revenue, allowance for loan losses, the level of
credit losses from lending, liquidity levels, capital levels, or
other future financial or business performance strategies or
expectations, and any statements of the plans and objectives of
management for future operations products or services, including
the expected benefits from, and/or the execution of integration
plans relating to any acquisition we have undertaking or that we
undertake in the future; plans and cost savings regarding branch
closings or consolidation; any statement of expectation or belief;
projections related to certain financial metrics; and any statement
of assumptions underlying the foregoing. These forward-looking
statements express management’s current expectations or forecasts
of future events, results and conditions, and by their nature are
subject to and involve risks and uncertainties that could cause
actual results to differ materially from those anticipated by the
statements made herein. Factors that might cause actual results to
differ materially from those made in such statements include, but
are not limited to: risks, uncertainties and other factors relating
to the COVID-19 pandemic (including the length of time that the
pandemic continues, the ability of states and local governments to
successfully implement the lifting of restrictions on movement and
the potential imposition of further restrictions on movement and
travel in the future, the effect of the pandemic on the general
economy and on the businesses of our borrowers and their ability to
make payments on their obligations; the remedial actions and
stimulus measures adopted by federal, state and local governments,
and the inability of employees to work due to illness, quarantine,
or government mandates); the synergies and other expected financial
benefits from any acquisition that we have undertaken or may
undertake in the future; may or may not be realized within the
expected time frames; changes in the Company's or the Bank's
strategy, costs or difficulties related to integration matters
might be greater than expected; availability of and costs
associated with obtaining adequate and timely sources of liquidity;
the ability to maintain credit quality; general economic trends;
changes in interest rates; loss of deposits and loan demand to
other financial institutions; substantial changes in financial
markets; changes in real estate value and the real estate market;
regulatory changes; the impact of government shutdowns or
sequestration; the possibility of unforeseen events affecting the
industry generally; the uncertainties associated with newly
developed or acquired operations; the outcome of pending or
threatened litigation, or of matters before regulatory agencies,
whether currently existing or commencing in the future; market
disruptions and other effects of terrorist activities; and the
matters described in “Item 1A Risk Factors” in the Company’s Annual
Report on Form 10-K for the Year Ended December 31, 2020, and
in its other Reports filed with the Securities and Exchange
Commission (the “SEC”). The Company’s forward-looking statements
may also be subject to other risks and uncertainties, including
those that it may discuss elsewhere in this news release or in its
filings with the SEC, accessible on the SEC’s Web site at
www.sec.gov. The Company undertakes no obligation to update these
forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unforeseen events,
except as required under the rules and regulations of the SEC.
Data is unaudited as of June 30, 2021. This
selected information should be read in conjunction with the
financial statements and notes included in the Company's Annual
Report on Form 10-K for the year ended December 31, 2020.
CONTACTS:William J. Pasenelli,
Chief Executive OfficerTodd L. Capitani, Chief Financial
Officer888.745.2265
SUPPLEMENTAL QUARTERLY FINANCIAL
DATA CONSOLIDATED INCOME STATEMENT
(UNAUDITED)
| |
|
Three Months Ended |
|
(dollars in thousands) |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
Interest and Dividend Income |
|
|
|
|
|
|
|
|
|
|
|
Loans, including fees |
|
$ |
16,320 |
|
|
$ |
16,592 |
|
|
$ |
16,776 |
|
|
$ |
16,176 |
|
|
$ |
16,277 |
|
|
Interest and dividends on securities |
|
1,101 |
|
|
1,064 |
|
|
1,091 |
|
|
1,269 |
|
|
1,341 |
|
|
Interest on deposits with banks |
|
23 |
|
|
22 |
|
|
46 |
|
|
38 |
|
|
20 |
|
| Total Interest and
Dividend Income |
|
17,444 |
|
|
17,678 |
|
|
17,913 |
|
|
17,483 |
|
|
17,638 |
|
| Interest
Expense |
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
640 |
|
|
802 |
|
|
1,166 |
|
|
1,534 |
|
|
1,937 |
|
|
Short-term borrowings |
|
— |
|
|
— |
|
|
— |
|
|
14 |
|
|
28 |
|
|
Long-term debt |
|
369 |
|
|
367 |
|
|
775 |
|
|
567 |
|
|
449 |
|
| Total Interest
Expense |
|
1,009 |
|
|
1,169 |
|
|
1,941 |
|
|
2,115 |
|
|
2,414 |
|
| Net Interest Income
("NII") |
|
16,435 |
|
|
16,509 |
|
|
15,972 |
|
|
15,368 |
|
|
15,224 |
|
|
Provision for loan losses |
|
291 |
|
|
295 |
|
|
600 |
|
|
2,500 |
|
|
3,500 |
|
| NII After Provision
For Loan Losses |
|
16,144 |
|
|
16,214 |
|
|
15,372 |
|
|
12,868 |
|
|
11,724 |
|
| Noninterest
Income |
|
|
|
|
|
|
|
|
|
|
|
Loan appraisal, credit, and misc. charges |
|
44 |
|
|
198 |
|
|
76 |
|
|
49 |
|
|
35 |
|
|
Gain on sale or disposition of assets |
|
68 |
|
|
— |
|
|
— |
|
|
6 |
|
|
— |
|
|
Net gains on sale of investment securities |
|
— |
|
|
586 |
|
|
714 |
|
|
229 |
|
|
112 |
|
|
Unrealized gain (losses) on equity securities |
|
13 |
|
|
(85 |
) |
|
(14 |
) |
|
— |
|
|
40 |
|
|
Income from bank owned life insurance |
|
218 |
|
|
214 |
|
|
220 |
|
|
222 |
|
|
220 |
|
|
Service charges |
|
892 |
|
|
1,187 |
|
|
960 |
|
|
839 |
|
|
709 |
|
|
Referral fee income |
|
621 |
|
|
451 |
|
|
414 |
|
|
321 |
|
|
1,143 |
|
|
Loss on sale of loans |
|
— |
|
|
(191 |
) |
|
— |
|
|
— |
|
|
— |
|
| Total Noninterest
Income |
|
1,856 |
|
|
2,360 |
|
|
2,370 |
|
|
1,666 |
|
|
2,259 |
|
| Noninterest
Expense |
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
5,332 |
|
|
4,788 |
|
|
4,552 |
|
|
5,099 |
|
|
4,714 |
|
|
OREO valuation allowance and expenses |
|
488 |
|
|
181 |
|
|
897 |
|
|
421 |
|
|
1,100 |
|
| Sub
Total |
|
5,820 |
|
|
4,969 |
|
|
5,449 |
|
|
5,520 |
|
|
5,814 |
|
| Operating
Expenses |
|
|
|
|
|
|
|
|
|
|
|
Occupancy expense |
|
688 |
|
|
761 |
|
|
806 |
|
|
734 |
|
|
736 |
|
|
Advertising |
|
148 |
|
|
79 |
|
|
145 |
|
|
129 |
|
|
130 |
|
|
Data processing expense |
|
990 |
|
|
936 |
|
|
829 |
|
|
990 |
|
|
924 |
|
|
Professional fees |
|
604 |
|
|
640 |
|
|
658 |
|
|
652 |
|
|
477 |
|
|
Depreciation of premises and equipment |
|
135 |
|
|
147 |
|
|
154 |
|
|
142 |
|
|
151 |
|
|
FDIC Insurance |
|
140 |
|
|
252 |
|
|
260 |
|
|
249 |
|
|
260 |
|
|
Core deposit intangible amortization |
|
126 |
|
|
133 |
|
|
139 |
|
|
144 |
|
|
151 |
|
|
Other |
|
727 |
|
|
2,231 |
|
|
1,032 |
|
|
891 |
|
|
754 |
|
| Total Operating
Expenses |
|
3,558 |
|
|
5,179 |
|
|
4,023 |
|
|
3,931 |
|
|
3,583 |
|
| Total Noninterest
Expense |
|
9,378 |
|
|
10,148 |
|
|
9,472 |
|
|
9,451 |
|
|
9,397 |
|
|
Income before income taxes |
|
8,622 |
|
|
8,426 |
|
|
8,270 |
|
|
5,083 |
|
|
4,586 |
|
|
Income tax expense |
|
2,190 |
|
|
2,127 |
|
|
2,131 |
|
|
1,284 |
|
|
1,136 |
|
| Net
Income |
|
$ |
6,432 |
|
|
$ |
6,299 |
|
|
$ |
6,139 |
|
|
$ |
3,799 |
|
|
$ |
3,450 |
|
SUPPLEMENTAL QUARTERLY FINANCIAL DATA -
Continued CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
|
(dollars in thousands, except per share amounts) |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
$ |
40,881 |
|
|
$ |
126,834 |
|
|
$ |
56,887 |
|
|
$ |
93,130 |
|
|
$ |
103,914 |
|
| Federal funds sold |
|
79,404 |
|
|
43,614 |
|
|
— |
|
|
69,431 |
|
|
29,456 |
|
| Interest-bearing deposits with
banks |
|
18,626 |
|
|
17,390 |
|
|
20,178 |
|
|
25,132 |
|
|
13,051 |
|
| Securities available for sale
("AFS"), at fair value |
|
347,678 |
|
|
253,348 |
|
|
246,105 |
|
|
229,620 |
|
|
234,982 |
|
| Equity securities carried at
fair value through income |
|
4,814 |
|
|
4,787 |
|
|
4,855 |
|
|
4,851 |
|
|
4,831 |
|
| Non-marketable equity
securities held in other financial institutions |
|
207 |
|
|
207 |
|
|
207 |
|
|
209 |
|
|
209 |
|
| Federal Home Loan Bank
("FHLB") stock - at cost |
|
2,036 |
|
|
2,036 |
|
|
2,777 |
|
|
3,415 |
|
|
4,691 |
|
| Net U.S. Small Business
Administration ("SBA") Paycheck Protection ("PPP") Loans |
|
86,482 |
|
|
112,485 |
|
|
107,960 |
|
|
127,811 |
|
|
125,638 |
|
| Portfolio Loans Receivable net
of allowance for loan losses of $18,516, $18,256, $19,424, $18,829,
and $16,319 |
|
1,515,893 |
|
|
1,489,806 |
|
|
1,486,115 |
|
|
1,479,313 |
|
|
1,478,498 |
|
| Net Loans |
|
1,602,375 |
|
|
1,602,291 |
|
|
1,594,075 |
|
|
1,607,124 |
|
|
1,604,136 |
|
| Goodwill |
|
10,835 |
|
|
10,835 |
|
|
10,835 |
|
|
10,835 |
|
|
10,835 |
|
| Premises and equipment,
net |
|
21,630 |
|
|
20,540 |
|
|
20,271 |
|
|
20,671 |
|
|
20,972 |
|
| Premises and equipment held
for sale |
|
430 |
|
|
430 |
|
|
430 |
|
|
430 |
|
|
430 |
|
| Other real estate owned
("OREO") |
|
1,536 |
|
|
2,329 |
|
|
3,109 |
|
|
3,998 |
|
|
3,695 |
|
| Accrued interest
receivable |
|
6,590 |
|
|
7,337 |
|
|
8,717 |
|
|
8,975 |
|
|
6,773 |
|
| Investment in bank owned life
insurance |
|
38,493 |
|
|
38,275 |
|
|
38,061 |
|
|
37,841 |
|
|
37,619 |
|
| Core deposit intangible |
|
1,267 |
|
|
1,394 |
|
|
1,527 |
|
|
1,666 |
|
|
1,810 |
|
| Net deferred tax assets |
|
8,139 |
|
|
8,671 |
|
|
7,909 |
|
|
7,307 |
|
|
6,565 |
|
| Right of use assets -
operating leases |
|
6,305 |
|
|
6,391 |
|
|
7,831 |
|
|
8,005 |
|
|
8,132 |
|
| Other assets |
|
3,813 |
|
|
2,822 |
|
|
2,665 |
|
|
4,797 |
|
|
1,655 |
|
| Total
Assets |
|
$ |
2,195,059 |
|
|
$ |
2,149,531 |
|
|
$ |
2,026,439 |
|
|
$ |
2,137,437 |
|
|
$ |
2,093,756 |
|
| Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
| Deposits |
|
|
|
|
|
|
|
|
|
|
| Non-interest-bearing
deposits |
|
$ |
423,165 |
|
|
$ |
406,319 |
|
|
$ |
362,079 |
|
|
$ |
360,839 |
|
|
$ |
356,196 |
|
| Interest-bearing deposits |
|
1,484,973 |
|
|
1,461,577 |
|
|
1,383,523 |
|
|
1,418,767 |
|
|
1,314,168 |
|
| Total deposits |
|
1,908,138 |
|
|
1,867,896 |
|
|
1,745,602 |
|
|
1,779,606 |
|
|
1,670,364 |
|
| Short-term borrowings |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
5,000 |
|
| Long-term debt |
|
27,267 |
|
|
27,285 |
|
|
27,302 |
|
|
42,319 |
|
|
67,336 |
|
| Paycheck Protection Program
Liquidity Facility ("PPPLF") Advance |
|
— |
|
|
— |
|
|
— |
|
|
85,893 |
|
|
126,801 |
|
| Guaranteed preferred
beneficial interest in junior subordinated debentures
("TRUPs") |
|
12,000 |
|
|
12,000 |
|
|
12,000 |
|
|
12,000 |
|
|
12,000 |
|
| Subordinated notes -
4.75% |
|
19,482 |
|
|
19,468 |
|
|
19,526 |
|
|
— |
|
|
— |
|
| Lease liabilities - operating
leases |
|
6,512 |
|
|
6,614 |
|
|
8,088 |
|
|
8,193 |
|
|
8,296 |
|
| Accrued expenses and other
liabilities |
|
17,698 |
|
|
15,509 |
|
|
15,908 |
|
|
16,576 |
|
|
14,517 |
|
| Total
Liabilities |
|
1,991,097 |
|
|
1,948,772 |
|
|
1,828,426 |
|
|
1,944,587 |
|
|
1,904,314 |
|
| Stockholders'
Equity |
|
|
|
|
|
|
|
|
|
|
| Common stock |
|
58 |
|
|
59 |
|
|
59 |
|
|
59 |
|
|
59 |
|
| Additional paid in
capital |
|
96,411 |
|
|
96,181 |
|
|
95,965 |
|
|
95,799 |
|
|
95,687 |
|
| Retained earnings |
|
104,889 |
|
|
103,294 |
|
|
97,944 |
|
|
92,814 |
|
|
89,781 |
|
| Accumulated other
comprehensive income |
|
3,063 |
|
|
1,684 |
|
|
4,504 |
|
|
4,780 |
|
|
4,517 |
|
| Unearned ESOP shares |
|
(459 |
) |
|
(459 |
) |
|
(459 |
) |
|
(602 |
) |
|
(602 |
) |
| Total Stockholders'
Equity |
|
203,962 |
|
|
200,759 |
|
|
198,013 |
|
|
192,850 |
|
|
189,442 |
|
| Total Liabilities and
Stockholders' Equity |
|
$ |
2,195,059 |
|
|
$ |
2,149,531 |
|
|
$ |
2,026,439 |
|
|
$ |
2,137,437 |
|
|
$ |
2,093,756 |
|
| Common shares issued and
outstanding |
|
5,786,928 |
|
|
5,897,685 |
|
|
5,903,613 |
|
|
5,911,940 |
|
|
5,911,715 |
|
SUPPLEMENTAL QUARTERLY FINANCIAL DATA -
Continued SELECTED FINANCIAL INFORMATION AND
RATIOS (UNAUDITED)
| |
|
Three Months Ended |
|
(dollars in thousands, except per share amounts) |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
KEY OPERATING RATIOS |
|
|
|
|
|
|
|
|
|
|
| Return on average assets
("ROAA") |
|
1.22 |
% |
|
1.22 |
% |
|
1.18 |
% |
|
0.73 |
% |
|
0.69 |
% |
| Pre-tax pre-provision
ROAA** |
|
1.68 |
% |
|
1.68 |
% |
|
1.71 |
% |
|
1.46 |
% |
|
1.62 |
% |
| Return on average common
equity ("ROACE") |
|
12.62 |
% |
|
12.53 |
% |
|
12.51 |
% |
|
7.86 |
% |
|
7.27 |
% |
| Pre-tax pre-provision
ROACE** |
|
17.49 |
% |
|
17.34 |
% |
|
18.08 |
% |
|
15.69 |
% |
|
17.03 |
% |
| Return on average tangible
common equity ("ROATCE")** |
|
13.62 |
% |
|
13.56 |
% |
|
13.58 |
% |
|
8.65 |
% |
|
8.05 |
% |
| Average total equity to
average total assets |
|
9.63 |
% |
|
9.71 |
% |
|
9.46 |
% |
|
9.33 |
% |
|
9.52 |
% |
| Interest rate spread |
|
3.30 |
% |
|
3.43 |
% |
|
3.29 |
% |
|
3.15 |
% |
|
3.21 |
% |
| Net interest margin |
|
3.37 |
% |
|
3.50 |
% |
|
3.40 |
% |
|
3.27 |
% |
|
3.34 |
% |
| Cost of funds |
|
0.21 |
% |
|
0.25 |
% |
|
0.42 |
% |
|
0.46 |
% |
|
0.54 |
% |
| Cost of deposits |
|
0.14 |
% |
|
0.18 |
% |
|
0.26 |
% |
|
0.37 |
% |
|
0.48 |
% |
| Cost of debt |
|
2.51 |
% |
|
2.50 |
% |
|
3.45 |
% |
|
1.16 |
% |
|
1.06 |
% |
| Efficiency ratio |
|
51.27 |
% |
|
53.78 |
% |
|
51.64 |
% |
|
55.48 |
% |
|
53.75 |
% |
| Non-interest expense to
average assets |
|
1.77 |
% |
|
1.96 |
% |
|
1.83 |
% |
|
1.82 |
% |
|
1.88 |
% |
| Net operating expense to
average assets |
|
1.42 |
% |
|
1.50 |
% |
|
1.37 |
% |
|
1.50 |
% |
|
1.43 |
% |
| Average interest-earning
assets to average interest-bearing liabilities |
|
131.36 |
% |
|
128.84 |
% |
|
126.18 |
% |
|
125.40 |
% |
|
125.51 |
% |
| Net charge-offs to average
portfolio loans |
|
0.01 |
% |
|
0.40 |
% |
|
0.00 |
% |
|
0.00 |
% |
|
0.61 |
% |
| COMMON SHARE
DATA |
|
|
|
|
|
|
|
|
|
|
|
Basic net income per common share |
|
$ |
1.10 |
|
|
$ |
1.07 |
|
|
$ |
1.04 |
|
|
$ |
0.64 |
|
|
$ |
0.59 |
|
| Diluted net income per common
share |
|
$ |
1.10 |
|
|
$ |
1.07 |
|
|
$ |
1.04 |
|
|
$ |
0.64 |
|
|
$ |
0.59 |
|
| Cash dividends paid per common
share |
|
$ |
0.150 |
|
|
$ |
0.125 |
|
|
$ |
0.125 |
|
|
$ |
0.125 |
|
|
$ |
0.125 |
|
| Basic - weighted average
common shares outstanding |
|
5,845,009 |
|
|
5,888,250 |
|
|
5,892,751 |
|
|
5,895,074 |
|
|
5,894,009 |
|
| Diluted - weighted average
common shares outstanding |
|
5,856,954 |
|
|
5,897,698 |
|
|
5,894,494 |
|
|
5,895,074 |
|
|
5,894,009 |
|
| ASSET
QUALITY |
|
|
|
|
|
|
|
|
|
|
| Total assets |
|
$ |
2,195,059 |
|
|
$ |
2,149,531 |
|
|
$ |
2,026,439 |
|
|
$ |
2,137,437 |
|
|
$ |
2,093,756 |
|
| Gross portfolio loans (1) |
|
1,533,876 |
|
|
1,507,183 |
|
|
1,504,275 |
|
|
1,496,532 |
|
|
1,492,745 |
|
| Classified assets |
|
14,918 |
|
|
16,145 |
|
|
22,358 |
|
|
24,600 |
|
|
25,115 |
|
| Allowance for loan losses |
|
18,516 |
|
|
18,256 |
|
|
19,424 |
|
|
18,829 |
|
|
16,319 |
|
| Past due loans - 31 to 89
days |
|
101 |
|
|
1,373 |
|
|
179 |
|
|
838 |
|
|
5,843 |
|
| Past due loans >=90
days |
|
5,836 |
|
|
5,453 |
|
|
11,965 |
|
|
17,230 |
|
|
20,072 |
|
| Total past due loans (2)
(3) |
|
5,937 |
|
|
6,826 |
|
|
12,144 |
|
|
18,068 |
|
|
25,915 |
|
| |
|
|
|
|
|
|
|
|
|
|
| Non-accrual loans (4) |
|
13,802 |
|
|
13,623 |
|
|
18,222 |
|
|
20,148 |
|
|
22,896 |
|
| Accruing troubled debt
restructures ("TDRs") |
|
503 |
|
|
504 |
|
|
572 |
|
|
573 |
|
|
593 |
|
| Other real estate owned
("OREO") |
|
1,536 |
|
|
2,329 |
|
|
3,109 |
|
|
3,998 |
|
|
3,695 |
|
|
Non-accrual loans, OREO and TDRs |
|
$ |
15,841 |
|
|
$ |
16,456 |
|
|
$ |
21,903 |
|
|
$ |
24,719 |
|
|
$ |
27,184 |
|
** Non-GAAP financial measure. See
reconciliation of GAAP and NON-GAAP measures.
____________________________________
(1) Portfolio loans include all loan portfolios
except the U.S. SBA PPP loan portfolio. Asset quality ratios for
loans exclude U.S. SBA PPP loans.
(2) Delinquency excludes Purchase Credit
Impaired ("PCI") loans.
(3) There were no COVID-19 deferred loans in
process as of July 22, 2021 that were reported as delinquent
as of June 30, 2021.
(4) Non-accrual loans include all loans that are
90 days or more delinquent and loans that are non-accrual due to
the operating results or cash flows of a customer. Non-accrual
loans can include loans that are current with all loan payments. At
June 30, 2021 and December 31, 2020, the Company had
current non-accrual loans of $8.0 million and $6.3 million,
respectively.
SUPPLEMENTAL QUARTERLY FINANCIAL DATA -
Continued SELECTED FINANCIAL INFORMATION AND
RATIOS (UNAUDITED)
| |
|
Three Months Ended |
|
(dollars in thousands, except per share amounts) |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
ASSET QUALITY RATIOS (1) |
|
|
|
|
|
|
|
|
|
|
| Classified assets to total
assets |
|
0.68 |
% |
|
0.75 |
% |
|
1.10 |
% |
|
1.15 |
% |
|
1.20 |
% |
| Classified assets to
risk-based capital |
|
6.24 |
% |
|
6.81 |
% |
|
9.61 |
% |
|
11.89 |
% |
|
12.49 |
% |
| Allowance for loan losses to
total loans |
|
1.21 |
% |
|
1.21 |
% |
|
1.29 |
% |
|
1.26 |
% |
|
1.09 |
% |
| Allowance for loan losses to
non-accrual loans |
|
134.15 |
% |
|
134.01 |
% |
|
106.60 |
% |
|
93.45 |
% |
|
71.27 |
% |
| Past due loans - 31 to 89 days
to total loans |
|
0.01 |
% |
|
0.09 |
% |
|
0.01 |
% |
|
0.06 |
% |
|
0.39 |
% |
| Past due loans >=90 days to
total loans |
|
0.38 |
% |
|
0.36 |
% |
|
0.80 |
% |
|
1.15 |
% |
|
1.34 |
% |
| Total past due (delinquency)
to total loans |
|
0.39 |
% |
|
0.45 |
% |
|
0.81 |
% |
|
1.21 |
% |
|
1.74 |
% |
| Non-accrual loans to total
loans |
|
0.90 |
% |
|
0.90 |
% |
|
1.21 |
% |
|
1.35 |
% |
|
1.53 |
% |
| Non-accrual loans and TDRs to
total loans |
|
0.93 |
% |
|
0.94 |
% |
|
1.25 |
% |
|
1.38 |
% |
|
1.57 |
% |
| Non-accrual loans and OREO to
total assets |
|
0.70 |
% |
|
0.74 |
% |
|
1.05 |
% |
|
1.13 |
% |
|
1.27 |
% |
| Non-accrual loans and OREO to
total loans and OREO |
|
1.00 |
% |
|
1.06 |
% |
|
1.42 |
% |
|
1.61 |
% |
|
1.78 |
% |
| Non-accrual loans, OREO and
TDRs to total assets |
|
0.72 |
% |
|
0.77 |
% |
|
1.08 |
% |
|
1.16 |
% |
|
1.30 |
% |
| COMMON SHARE
DATA |
|
|
|
|
|
|
|
|
|
|
|
Book value per common share |
|
$ |
35.25 |
|
|
$ |
34.04 |
|
|
$ |
33.54 |
|
|
$ |
32.62 |
|
|
$ |
32.05 |
|
| Tangible book value per common
share** |
|
$ |
33.15 |
|
|
$ |
31.97 |
|
|
$ |
31.45 |
|
|
$ |
30.51 |
|
|
$ |
29.91 |
|
| Common shares outstanding at
end of period |
|
5,786,928 |
|
|
5,897,685 |
|
|
5,903,613 |
|
|
5,911,940 |
|
|
5,911,715 |
|
| OTHER
DATA |
|
|
|
|
|
|
|
|
|
|
| Full-time equivalent
employees |
|
189 |
|
|
192 |
|
|
189 |
|
|
189 |
|
|
194 |
|
| Branches |
|
12 |
|
|
11 |
|
|
12 |
|
|
12 |
|
|
12 |
|
| Loan Production Offices |
|
4 |
|
|
4 |
|
|
4 |
|
|
4 |
|
|
4 |
|
| CAPITAL
RATIOS |
|
|
|
|
|
|
|
|
|
|
| Tier 1 capital to average
assets |
|
9.57 |
% |
|
9.70 |
% |
|
9.56 |
% |
|
9.73 |
% |
|
9.76 |
% |
| Tier 1 common capital to
risk-weighted assets |
|
11.56 |
% |
|
11.72 |
% |
|
11.47 |
% |
|
11.11 |
% |
|
11.12 |
% |
| Tier 1 capital to
risk-weighted assets |
|
12.30 |
% |
|
12.47 |
% |
|
12.23 |
% |
|
11.87 |
% |
|
11.89 |
% |
| Total risk-based capital to
risk-weighted assets |
|
14.62 |
% |
|
14.83 |
% |
|
14.69 |
% |
|
13.06 |
% |
|
12.94 |
% |
| Common equity to assets |
|
9.29 |
% |
|
9.34 |
% |
|
9.77 |
% |
|
9.02 |
% |
|
9.05 |
% |
| Tangible common equity to
tangible assets ** |
|
8.79 |
% |
|
8.82 |
% |
|
9.22 |
% |
|
8.49 |
% |
|
8.50 |
% |
** Non-GAAP financial measure. See
reconciliation of GAAP and NON-GAAP measures.
____________________________________
(1) Asset quality ratios are calculated using
total portfolio loans. Portfolio loans include all loan portfolios
except the U.S. SBA PPP loan portfolio.
SUPPLEMENTAL YEAR TO DATE FINANCIAL
DATACONSOLIDATED INCOME STATEMENT
(UNAUDITED)
| |
|
Six Months Ended June 30, |
|
(dollars in thousands) |
|
2021 |
|
2020 |
|
Interest and Dividend Income |
|
|
|
|
|
Loans, including fees |
|
$ |
32,912 |
|
|
$ |
32,779 |
|
|
Interest and dividends on securities |
|
2,165 |
|
|
2,810 |
|
|
Interest on deposits with banks |
|
45 |
|
|
88 |
|
| Total Interest and
Dividend Income |
|
35,122 |
|
|
35,677 |
|
| Interest
Expense |
|
|
|
|
|
Deposits |
|
1,442 |
|
|
4,981 |
|
|
Short-term borrowings |
|
— |
|
|
97 |
|
|
Long-term debt |
|
736 |
|
|
1,022 |
|
| Total Interest
Expense |
|
2,178 |
|
|
6,100 |
|
| Net Interest Income
("NII") |
|
32,944 |
|
|
29,577 |
|
|
Provision for loan losses |
|
586 |
|
|
7,600 |
|
| NII After Provision
For Loan Losses |
|
32,358 |
|
|
21,977 |
|
| Noninterest
Income |
|
|
|
|
|
Loan appraisal, credit, and misc. charges |
|
242 |
|
|
49 |
|
|
Gain on sale or disposition of assets |
|
68 |
|
|
— |
|
|
Net gains on sale of investment securities |
|
586 |
|
|
441 |
|
|
Unrealized gain (loss) on equity securities |
|
(72 |
) |
|
115 |
|
|
Income from bank owned life insurance |
|
432 |
|
|
439 |
|
|
Service charges |
|
2,079 |
|
|
1,691 |
|
|
Referral fee income |
|
1,072 |
|
|
1,645 |
|
|
Loss on sale of loans |
|
(191 |
) |
|
— |
|
| Total Noninterest
Income |
|
4,216 |
|
|
4,380 |
|
| Noninterest
Expense |
|
|
|
|
|
Compensation and benefits |
|
10,120 |
|
|
9,902 |
|
|
OREO valuation allowance and expenses |
|
669 |
|
|
1,882 |
|
|
Sub-total |
|
10,789 |
|
|
11,784 |
|
| Operating
Expense |
|
|
|
|
|
Occupancy expense |
|
1,449 |
|
|
1,470 |
|
|
Advertising |
|
227 |
|
|
251 |
|
|
Data processing expense |
|
1,926 |
|
|
1,852 |
|
|
Professional fees |
|
1,244 |
|
|
1,103 |
|
|
Depreciation of premises and equipment |
|
282 |
|
|
309 |
|
|
FDIC Insurance |
|
392 |
|
|
430 |
|
|
Core deposit intangible amortization |
|
259 |
|
|
308 |
|
|
Other |
|
2,958 |
|
|
1,573 |
|
| Total Operating
Expense |
|
8,737 |
|
|
7,296 |
|
| Total Noninterest
Expense |
|
19,526 |
|
|
19,080 |
|
| Income before income
taxes |
|
17,048 |
|
|
7,277 |
|
| Income tax expense |
|
4,317 |
|
|
1,079 |
|
| Net
Income |
|
$ |
12,731 |
|
|
$ |
6,198 |
|
SUPPLEMENTAL YEAR TO DATE FINANCIAL DATA
(UNAUDITED)
| |
|
Six Months Ended June 30, |
|
|
|
2021 |
|
2020 |
|
KEY OPERATING RATIOS |
|
|
|
|
| Return on average assets
("ROAA") |
|
1.22 |
% |
|
0.65 |
% |
| Pre-tax pre-provision
ROAA** |
|
1.68 |
% |
|
1.57 |
% |
| Return on average common
equity ("ROACE") |
|
12.57 |
% |
|
6.64 |
% |
| Pre-tax pre-provision
ROACE** |
|
17.41 |
% |
|
15.95 |
% |
| Return on average tangible
common equity ("ROATCE")** |
|
13.59 |
% |
|
7.44 |
% |
| Average total equity to
average total assets |
|
9.67 |
% |
|
9.84 |
% |
| Interest rate spread |
|
3.36 |
% |
|
3.21 |
% |
| Net interest margin |
|
3.43 |
% |
|
3.39 |
% |
| Cost of funds |
|
0.23 |
% |
|
0.72 |
% |
| Cost of deposits |
|
0.16 |
% |
|
0.64 |
% |
| Cost of debt |
|
2.50 |
% |
|
1.61 |
% |
| Efficiency ratio |
|
52.55 |
% |
|
56.19 |
% |
| Non-interest expense to
average assets |
|
1.87 |
% |
|
2.01 |
% |
| Net operating expense to
average assets |
|
1.46 |
% |
|
1.55 |
% |
| Average interest-earning
assets to average interest-bearing liabilities |
|
130.12 |
% |
|
124.99 |
% |
| Net charge-offs to average
portfolio loans |
|
0.20 |
% |
|
0.30 |
% |
| COMMON SHARE
DATA |
|
|
|
|
|
Basic net income per common share |
|
$ |
2.17 |
|
|
$ |
1.05 |
|
| Diluted net income per common
share |
|
$ |
2.17 |
|
|
$ |
1.05 |
|
| Cash dividends paid per common
share |
|
$ |
0.28 |
|
|
$ |
0.25 |
|
| Weighted average
common shares outstanding: |
|
|
|
|
|
Basic |
|
5,866,510 |
|
|
5,890,607 |
|
|
Diluted |
|
5,877,698 |
|
|
5,890,607 |
|
____________________________________** Non-GAAP
financial measure. See reconciliation of GAAP and NON-GAAP
measures.
RECONCILIATION OF NON-GAAP MEASURES
(UNAUDITED)
Reconciliation of US GAAP total assets,
common equity, common equity to assets and book value to Non-GAAP
tangible assets, tangible common equity, tangible common equity to
tangible assets and tangible book value.
This press release, including the accompanying
financial statement tables, contains financial information
determined by methods other than in accordance with generally
accepted accounting principles, or GAAP. This financial information
includes certain performance measures, which exclude intangible
assets. These non-GAAP measures are included because the Company
believes they may provide useful supplemental information for
evaluating the underlying performance trends of the Company.
|
(dollars in thousands, except per share amounts) |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
Total assets |
|
$ |
2,195,059 |
|
|
$ |
2,149,531 |
|
|
$ |
2,026,439 |
|
|
$ |
2,137,437 |
|
|
$ |
2,093,756 |
|
| Less: intangible assets |
|
|
|
|
|
|
|
|
|
|
|
Goodwill |
|
10,835 |
|
|
10,835 |
|
|
10,835 |
|
|
10,835 |
|
|
10,835 |
|
|
Core deposit intangible |
|
1,267 |
|
|
1,394 |
|
|
1,527 |
|
|
1,666 |
|
|
1,810 |
|
| Total intangible assets |
|
12,102 |
|
|
12,229 |
|
|
12,362 |
|
|
12,501 |
|
|
12,645 |
|
| Tangible assets |
|
$ |
2,182,957 |
|
|
$ |
2,137,302 |
|
|
$ |
2,014,077 |
|
|
$ |
2,124,936 |
|
|
$ |
2,081,111 |
|
| |
|
|
|
|
|
|
|
|
|
|
| Total common equity |
|
$ |
203,962 |
|
|
$ |
200,759 |
|
|
$ |
198,013 |
|
|
$ |
192,850 |
|
|
$ |
189,442 |
|
| Less: intangible assets |
|
12,102 |
|
|
12,229 |
|
|
12,362 |
|
|
12,501 |
|
|
12,645 |
|
| Tangible common equity |
|
$ |
191,860 |
|
|
$ |
188,530 |
|
|
$ |
185,651 |
|
|
$ |
180,349 |
|
|
$ |
176,797 |
|
| |
|
|
|
|
|
|
|
|
|
|
| Common shares outstanding at
end of period |
|
5,786,928 |
|
|
5,897,685 |
|
|
5,903,613 |
|
|
5,911,940 |
|
|
5,911,715 |
|
| |
|
|
|
|
|
|
|
|
|
|
| Common equity to assets |
|
9.29 |
% |
|
9.34 |
% |
|
9.77 |
% |
|
9.02 |
% |
|
9.05 |
% |
| Tangible common equity to
tangible assets |
|
8.79 |
% |
|
8.82 |
% |
|
9.22 |
% |
|
8.49 |
% |
|
8.50 |
% |
| |
|
|
|
|
|
|
|
|
|
|
| Common book value per
share |
|
$ |
35.25 |
|
|
$ |
34.04 |
|
|
$ |
33.54 |
|
|
$ |
32.62 |
|
|
$ |
32.05 |
|
| Tangible common book value per
share |
|
$ |
33.15 |
|
|
$ |
31.97 |
|
|
$ |
31.45 |
|
|
$ |
30.51 |
|
|
$ |
29.91 |
|
RECONCILIATION OF NON-GAAP MEASURES
(UNAUDITED)
Pre-Tax Pre-Provision ("PTPP") Income,
PTPP Return on Average Assets ("ROAA"), PTPP Return on Average
Common Equity ("ROACE"), and Return on Average Tangible Common
Equity ("ROATCE")
Management believes that PTPP income, which
reflects the Company's profitability before income taxes and loan
loss provisions, allows investors to better assess the Company's
operating income and expenses in relation to the Company's core
operating revenue by removing the volatility that is associated
with credit provisions and different state income tax rates for
comparable institutions. ROATCE is computed by dividing net
earnings applicable to common shareholders by average tangible
common shareholders' equity. Management believes that ROATCE is
meaningful because it measures the performance of a business
consistently, whether acquired or internally developed. ROATCE is a
non-GAAP measure and may not be comparable to similar non-GAAP
measures used by other companies. Management also believes that
during a crisis such as the COVID-19 pandemic, this information is
useful as the impact of the pandemic on the loan loss provisions of
various institutions will likely vary based on the geography of the
communities served by a particular institution.
| |
|
Three Months Ended |
|
Six Months Ended |
|
(dollars in thousands) |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
June 30, 2021 |
|
June 30, 2020 |
|
Net income (as reported) |
|
$ |
6,432 |
|
|
$ |
6,299 |
|
|
$ |
6,139 |
|
|
$ |
3,799 |
|
|
$ |
3,450 |
|
|
$ |
12,731 |
|
|
$ |
6,198 |
|
| Provision for loan losses |
|
291 |
|
|
295 |
|
|
600 |
|
|
2,500 |
|
|
3,500 |
|
|
586 |
|
|
7,600 |
|
| Income tax expenses |
|
2,190 |
|
|
2,127 |
|
|
2,131 |
|
|
1,284 |
|
|
1,136 |
|
|
4,317 |
|
|
1,079 |
|
| Non-GAAP PTPP income |
|
$ |
8,913 |
|
|
$ |
8,721 |
|
|
$ |
8,870 |
|
|
$ |
7,583 |
|
|
$ |
8,086 |
|
|
$ |
17,634 |
|
|
$ |
14,877 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ROAA |
|
1.22 |
% |
|
1.22 |
% |
|
1.18 |
% |
|
0.73 |
% |
|
0.69 |
% |
|
1.22 |
% |
|
0.65 |
% |
| Pre-tax pre-provision
ROAA |
|
1.68 |
% |
|
1.68 |
% |
|
1.71 |
% |
|
1.46 |
% |
|
1.62 |
% |
|
1.68 |
% |
|
1.57 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ROACE |
|
12.62 |
% |
|
12.53 |
% |
|
12.51 |
% |
|
7.86 |
% |
|
7.27 |
% |
|
12.57 |
% |
|
6.64 |
% |
| Pre-tax pre-provision
ROACE |
|
17.49 |
% |
|
17.34 |
% |
|
18.08 |
% |
|
15.69 |
% |
|
17.03 |
% |
|
17.41 |
% |
|
15.95 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Average assets |
|
$ |
2,116,939 |
|
|
$ |
2,070,575 |
|
|
$ |
2,074,707 |
|
|
$ |
2,071,487 |
|
|
$ |
1,995,552 |
|
|
$ |
2,093,886 |
|
|
$ |
1,896,488 |
|
| Average equity |
|
$ |
203,893 |
|
|
$ |
201,124 |
|
|
$ |
196,279 |
|
|
$ |
193,351 |
|
|
$ |
189,890 |
|
|
$ |
202,516 |
|
|
$ |
186,580 |
|
| |
|
Three Months Ended |
|
Six Months Ended |
|
(dollars in thousands) |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
June 30, 2021 |
|
June 30, 2020 |
|
Net income (as reported) |
|
$ |
6,432 |
|
|
$ |
6,299 |
|
|
$ |
6,139 |
|
|
$ |
3,799 |
|
|
$ |
3,450 |
|
|
$ |
12,731 |
|
|
$ |
6,198 |
|
| Core deposit intangible
amortization (net of tax) |
|
94 |
|
|
99 |
|
|
103 |
|
|
108 |
|
|
114 |
|
|
193 |
|
|
262 |
|
| Net earnings applicable to
common shareholders |
|
$ |
6,526 |
|
|
$ |
6,398 |
|
|
$ |
6,242 |
|
|
$ |
3,907 |
|
|
$ |
3,564 |
|
|
$ |
12,924 |
|
|
$ |
6,460 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ROATCE |
|
13.62 |
% |
|
13.56 |
% |
|
13.58 |
% |
|
8.65 |
% |
|
8.05 |
% |
|
13.59 |
% |
|
7.44 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Average tangible common
equity |
|
$ |
191,708 |
|
|
$ |
188,808 |
|
|
$ |
183,827 |
|
|
$ |
180,755 |
|
|
$ |
177,146 |
|
|
$ |
190,266 |
|
|
$ |
173,759 |
|
AVERAGE CONSOLIDATED BALANCE SHEETS AND
NET INTEREST INCOME (UNAUDITED)
| |
|
For the Three Months Ended June 30, |
|
For the Three Months Ended |
| |
|
2021 |
|
2020 |
|
June 30, 2021 |
|
March 31, 2021 |
|
(dollars in thousands) |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
|
$ |
1,089,781 |
|
|
$ |
10,953 |
|
|
4.02 |
% |
|
$ |
981,188 |
|
|
$ |
10,537 |
|
|
4.30 |
% |
|
$ |
1,089,781 |
|
|
$ |
10,953 |
|
|
4.02 |
% |
|
$ |
1,059,803 |
|
|
$ |
10,696 |
|
|
4.04 |
% |
|
Residential first mortgages |
|
109,296 |
|
|
838 |
|
|
3.07 |
% |
|
168,958 |
|
|
1,397 |
|
|
3.31 |
% |
|
109,296 |
|
|
838 |
|
|
3.07 |
% |
|
124,984 |
|
|
914 |
|
|
2.93 |
% |
|
Residential rentals |
|
139,080 |
|
|
1,410 |
|
|
4.06 |
% |
|
131,018 |
|
|
1,521 |
|
|
4.64 |
% |
|
139,080 |
|
|
1,410 |
|
|
4.06 |
% |
|
139,220 |
|
|
1,445 |
|
|
4.15 |
% |
|
Construction and land development |
|
38,315 |
|
|
425 |
|
|
4.44 |
% |
|
39,856 |
|
|
445 |
|
|
4.47 |
% |
|
38,315 |
|
|
425 |
|
|
4.44 |
% |
|
36,091 |
|
|
402 |
|
|
4.46 |
% |
|
Home equity and second mortgages |
|
29,061 |
|
|
251 |
|
|
3.45 |
% |
|
35,135 |
|
|
318 |
|
|
3.62 |
% |
|
29,061 |
|
|
251 |
|
|
3.45 |
% |
|
29,272 |
|
|
248 |
|
|
3.39 |
% |
|
Commercial and equipment loans |
|
104,117 |
|
|
1,108 |
|
|
4.26 |
% |
|
131,186 |
|
|
1,554 |
|
|
4.74 |
% |
|
104,117 |
|
|
1,108 |
|
|
4.26 |
% |
|
105,284 |
|
|
1,070 |
|
|
4.07 |
% |
|
U.S. SBA PPP loans |
|
104,426 |
|
|
1,318 |
|
|
5.05 |
% |
|
90,132 |
|
|
493 |
|
|
2.19 |
% |
|
104,426 |
|
|
1,318 |
|
|
5.05 |
% |
|
116,003 |
|
|
1,802 |
|
|
6.21 |
% |
|
Consumer loans |
|
1,425 |
|
|
17 |
|
|
4.77 |
% |
|
1,119 |
|
|
12 |
|
|
4.29 |
% |
|
1,425 |
|
|
17 |
|
|
4.77 |
% |
|
1,320 |
|
|
15 |
|
|
4.55 |
% |
|
Allowance for loan losses |
|
(18,265 |
) |
|
— |
|
|
0.00 |
% |
|
(15,597 |
) |
|
— |
|
|
0.00 |
% |
|
(18,265 |
) |
|
— |
|
|
0.00 |
% |
|
(19,614 |
) |
|
— |
|
|
0.00 |
% |
| Loan portfolio (1) |
|
$ |
1,597,236 |
|
|
$ |
16,320 |
|
|
4.09 |
% |
|
$ |
1,562,995 |
|
|
$ |
16,277 |
|
|
4.17 |
% |
|
$ |
1,597,236 |
|
|
$ |
16,320 |
|
|
4.09 |
% |
|
$ |
1,592,363 |
|
|
$ |
16,592 |
|
|
4.17 |
% |
| Taxable investment
securities |
|
276,019 |
|
|
1,020 |
|
|
1.48 |
% |
|
211,917 |
|
|
1,248 |
|
|
2.36 |
% |
|
276,019 |
|
|
1,020 |
|
|
1.48 |
% |
|
229,810 |
|
|
951 |
|
|
1.66 |
% |
| Nontaxable investment
securities |
|
15,559 |
|
|
81 |
|
|
2.08 |
% |
|
12,586 |
|
|
93 |
|
|
2.96 |
% |
|
15,559 |
|
|
81 |
|
|
2.08 |
% |
|
20,841 |
|
|
114 |
|
|
2.19 |
% |
| Interest-bearing deposits in
other banks |
|
28,844 |
|
|
13 |
|
|
0.18 |
% |
|
17,384 |
|
|
11 |
|
|
0.25 |
% |
|
28,844 |
|
|
13 |
|
|
0.18 |
% |
|
25,064 |
|
|
14 |
|
|
0.22 |
% |
| Federal funds sold |
|
34,778 |
|
|
10 |
|
|
0.12 |
% |
|
15,893 |
|
|
9 |
|
|
0.23 |
% |
|
34,778 |
|
|
10 |
|
|
0.12 |
% |
|
18,721 |
|
|
7 |
|
|
0.15 |
% |
| Total interest-earning
assets |
|
1,952,436 |
|
|
17,444 |
|
|
3.57 |
% |
|
1,820,775 |
|
|
17,638 |
|
|
3.87 |
% |
|
1,952,436 |
|
|
17,444 |
|
|
3.57 |
% |
|
1,886,799 |
|
|
17,678 |
|
|
3.75 |
% |
| Cash and cash equivalents |
|
65,897 |
|
|
|
|
|
|
73,206 |
|
|
|
|
|
|
65,897 |
|
|
|
|
|
|
82,669 |
|
|
|
|
|
| Goodwill |
|
10,835 |
|
|
|
|
|
|
10,835 |
|
|
|
|
|
|
10,835 |
|
|
|
|
|
|
10,835 |
|
|
|
|
|
| Core deposit intangible |
|
1,350 |
|
|
|
|
|
|
1,909 |
|
|
|
|
|
|
1,350 |
|
|
|
|
|
|
1,481 |
|
|
|
|
|
| Other assets |
|
86,421 |
|
|
|
|
|
|
88,827 |
|
|
|
|
|
|
86,421 |
|
|
|
|
|
|
88,791 |
|
|
|
|
|
| Total
Assets |
|
$ |
2,116,939 |
|
|
|
|
|
|
$ |
1,995,552 |
|
|
|
|
|
|
$ |
2,116,939 |
|
|
|
|
|
|
$ |
2,070,575 |
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing demand
deposits |
|
$ |
406,166 |
|
|
$ |
— |
|
|
0.00 |
% |
|
$ |
332,642 |
|
|
$ |
— |
|
|
0.00 |
% |
|
$ |
406,166 |
|
|
$ |
— |
|
|
0.00 |
% |
|
$ |
381,059 |
|
|
$ |
— |
|
|
0.00 |
% |
| Interest-bearing deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings |
|
105,814 |
|
|
13 |
|
|
0.05 |
% |
|
81,019 |
|
|
30 |
|
|
0.15 |
% |
|
105,814 |
|
|
13 |
|
|
0.05 |
% |
|
101,782 |
|
|
13 |
|
|
0.05 |
% |
|
Interest-bearing demand and money market accounts |
|
977,201 |
|
|
185 |
|
|
0.08 |
% |
|
816,836 |
|
|
481 |
|
|
0.24 |
% |
|
977,201 |
|
|
185 |
|
|
0.08 |
% |
|
952,554 |
|
|
195 |
|
|
0.08 |
% |
|
Certificates of deposit |
|
344,533 |
|
|
442 |
|
|
0.51 |
% |
|
373,129 |
|
|
1,426 |
|
|
1.53 |
% |
|
344,533 |
|
|
442 |
|
|
0.51 |
% |
|
351,365 |
|
|
594 |
|
|
0.68 |
% |
| Total interest-bearing
deposits |
|
1,427,548 |
|
|
640 |
|
|
0.18 |
% |
|
1,270,984 |
|
|
1,937 |
|
|
0.61 |
% |
|
1,427,548 |
|
|
640 |
|
|
0.18 |
% |
|
1,405,701 |
|
|
802 |
|
|
0.23 |
% |
| Total deposits |
|
1,833,714 |
|
|
640 |
|
|
0.14 |
% |
|
1,603,626 |
|
|
1,937 |
|
|
0.48 |
% |
|
1,833,714 |
|
|
640 |
|
|
0.14 |
% |
|
1,786,760 |
|
|
802 |
|
|
0.18 |
% |
| Long-term debt |
|
27,273 |
|
|
43 |
|
|
0.63 |
% |
|
67,342 |
|
|
276 |
|
|
1.64 |
% |
|
27,273 |
|
|
43 |
|
|
0.63 |
% |
|
27,291 |
|
|
41 |
|
|
0.60 |
% |
| Short-term debt |
|
— |
|
|
— |
|
|
0.00 |
% |
|
13,077 |
|
|
28 |
|
|
0.86 |
% |
|
— |
|
|
— |
|
|
0.00 |
% |
|
— |
|
|
— |
|
|
0.00 |
% |
| PPPLF advance |
|
— |
|
|
— |
|
|
0.00 |
% |
|
87,332 |
|
|
76 |
|
|
0.35 |
% |
|
— |
|
|
— |
|
|
0.00 |
% |
|
— |
|
|
— |
|
|
0.00 |
% |
| Subordinated notes |
|
19,473 |
|
|
251 |
|
|
5.16 |
% |
|
— |
|
|
— |
|
|
0.00 |
% |
|
19,473 |
|
|
251 |
|
|
5.16 |
% |
|
19,490 |
|
|
251 |
|
|
5.15 |
% |
| Guaranteed preferred
beneficial interest in junior subordinated debentures |
|
12,000 |
|
|
75 |
|
|
2.50 |
% |
|
12,000 |
|
|
97 |
|
|
3.23 |
% |
|
12,000 |
|
|
75 |
|
|
2.50 |
% |
|
12,000 |
|
|
75 |
|
|
2.50 |
% |
| Total debt |
|
58,746 |
|
|
369 |
|
|
2.51 |
% |
|
179,751 |
|
|
477 |
|
|
1.06 |
% |
|
58,746 |
|
|
369 |
|
|
2.51 |
% |
|
58,781 |
|
|
367 |
|
|
2.50 |
% |
| Interest-bearing
liabilities |
|
1,486,294 |
|
|
1,009 |
|
|
0.27 |
% |
|
1,450,735 |
|
|
2,414 |
|
|
0.67 |
% |
|
1,486,294 |
|
|
1,009 |
|
|
0.27 |
% |
|
1,464,482 |
|
|
1,169 |
|
|
0.32 |
% |
| Total funds |
|
1,892,460 |
|
|
1,009 |
|
|
0.21 |
% |
|
1,783,377 |
|
|
2,414 |
|
|
0.54 |
% |
|
1,892,460 |
|
|
1,009 |
|
|
0.21 |
% |
|
1,845,541 |
|
|
1,169 |
|
|
0.25 |
% |
| Other liabilities |
|
20,586 |
|
|
|
|
|
|
22,285 |
|
|
|
|
|
|
20,586 |
|
|
|
|
|
|
23,910 |
|
|
|
|
|
| Stockholders' equity |
|
203,893 |
|
|
|
|
|
|
189,890 |
|
|
|
|
|
|
203,893 |
|
|
|
|
|
|
201,124 |
|
|
|
|
|
| Total Liabilities and
Stockholders' Equity |
|
$ |
2,116,939 |
|
|
|
|
|
|
$ |
1,995,552 |
|
|
|
|
|
|
$ |
2,116,939 |
|
|
|
|
|
|
$ |
2,070,575 |
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest income |
|
|
|
$ |
16,435 |
|
|
|
|
|
|
$ |
15,224 |
|
|
|
|
|
|
$ |
16,435 |
|
|
|
|
|
|
$ |
16,509 |
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest rate spread |
|
|
|
|
|
3.30 |
% |
|
|
|
|
|
3.21 |
% |
|
|
|
|
|
3.30 |
% |
|
|
|
|
|
3.43 |
% |
| Net yield on interest-earning
assets |
|
|
|
|
|
3.37 |
% |
|
|
|
|
|
3.34 |
% |
|
|
|
|
|
3.37 |
% |
|
|
|
|
|
3.50 |
% |
| Average interest-earning
assets to average interest-bearing liabilities |
|
|
|
|
|
131.36 |
% |
|
|
|
|
|
125.51 |
% |
|
|
|
|
|
131.36 |
% |
|
|
|
|
|
128.84 |
% |
| Average loans to average
deposits |
|
|
|
|
|
87.10 |
% |
|
|
|
|
|
97.47 |
% |
|
|
|
|
|
87.10 |
% |
|
|
|
|
|
89.12 |
% |
| Average transaction deposits
to total average deposits ** |
|
|
|
|
|
81.21 |
% |
|
|
|
|
|
76.73 |
% |
|
|
|
|
|
81.21 |
% |
|
|
|
|
|
80.34 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cost of funds |
|
|
|
|
|
0.21 |
% |
|
|
|
|
|
0.54 |
% |
|
|
|
|
|
0.21 |
% |
|
|
|
|
|
0.25 |
% |
| Cost of deposits |
|
|
|
|
|
0.14 |
% |
|
|
|
|
|
0.48 |
% |
|
|
|
|
|
0.14 |
% |
|
|
|
|
|
0.18 |
% |
| Cost of debt |
|
|
|
|
|
2.51 |
% |
|
|
|
|
|
1.06 |
% |
|
|
|
|
|
2.51 |
% |
|
|
|
|
|
2.50 |
% |
(1) Loan average balance
includes non-accrual loans. There are no tax equivalency
adjustments. There was $75,000, $181,000 and $90,000 of accretion
interest for the three months ended June 30, 2021 and 2020,
and March 31, 2021,
respectively.____________________________________
** Transaction deposits exclude time deposits.
AVERAGE CONSOLIDATED BALANCE SHEETS AND
NET INTEREST INCOME (UNAUDITED)
| |
|
For the Six Months Ended June 30, |
| |
|
2021 |
|
2020 |
|
(dollars in thousands) |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Average Balance |
|
Interest |
|
Average Yield/Cost |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
|
$ |
1,074,874 |
|
|
$ |
21,648 |
|
|
4.03 |
% |
|
$ |
968,112 |
|
|
$ |
21,782 |
|
|
4.50 |
% |
|
Residential first mortgages |
|
117,097 |
|
|
1,752 |
|
|
2.99 |
% |
|
169,975 |
|
|
2,909 |
|
|
3.42 |
% |
|
Residential rentals |
|
139,150 |
|
|
2,855 |
|
|
4.10 |
% |
|
131,469 |
|
|
2,874 |
|
|
4.37 |
% |
|
Construction and land development |
|
37,209 |
|
|
828 |
|
|
4.45 |
% |
|
38,481 |
|
|
912 |
|
|
4.74 |
% |
|
Home equity and second mortgages |
|
29,166 |
|
|
499 |
|
|
3.42 |
% |
|
35,582 |
|
|
771 |
|
|
4.33 |
% |
|
Commercial and equipment loans |
|
104,697 |
|
|
2,178 |
|
|
4.16 |
% |
|
127,411 |
|
|
3,013 |
|
|
4.73 |
% |
|
U.S. SBA PPP loans |
|
110,183 |
|
|
3,120 |
|
|
5.66 |
% |
|
46,516 |
|
|
493 |
|
|
2.12 |
% |
|
Consumer loans |
|
1,373 |
|
|
32 |
|
|
4.66 |
% |
|
1,118 |
|
|
25 |
|
|
4.47 |
% |
|
Allowance for loan losses |
|
(18,936 |
) |
|
— |
|
|
— |
% |
|
(13,400 |
) |
|
— |
|
|
— |
% |
| Loan portfolio (1) |
|
$ |
1,594,813 |
|
|
$ |
32,912 |
|
|
4.13 |
% |
|
$ |
1,505,264 |
|
|
$ |
32,779 |
|
|
4.36 |
% |
| Taxable investment
securities |
|
253,043 |
|
|
1,970 |
|
|
1.56 |
% |
|
213,664 |
|
|
2,711 |
|
|
2.54 |
% |
| Nontaxable investment
securities |
|
18,185 |
|
|
195 |
|
|
2.14 |
% |
|
6,337 |
|
|
99 |
|
|
3.12 |
% |
| Interest-bearing deposits in
other banks |
|
26,964 |
|
|
28 |
|
|
0.21 |
% |
|
11,966 |
|
|
63 |
|
|
1.05 |
% |
| Federal funds sold |
|
26,794 |
|
|
17 |
|
|
0.13 |
% |
|
9,960 |
|
|
25 |
|
|
0.50 |
% |
| Total Interest-Earning
Assets |
|
1,919,799 |
|
|
35,122 |
|
|
3.66 |
% |
|
1,747,191 |
|
|
35,677 |
|
|
4.08 |
% |
| Cash and cash equivalents |
|
74,237 |
|
|
|
|
|
|
48,657 |
|
|
|
|
|
| Goodwill |
|
10,835 |
|
|
|
|
|
|
10,835 |
|
|
|
|
|
| Core deposit intangible |
|
1,415 |
|
|
|
|
|
|
1,986 |
|
|
|
|
|
| Other assets |
|
87,600 |
|
|
|
|
|
|
87,819 |
|
|
|
|
|
| Total
Assets |
|
$ |
2,093,886 |
|
|
|
|
|
|
$ |
1,896,488 |
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing demand
deposits |
|
393,682 |
|
|
— |
|
|
— |
% |
|
289,473 |
|
|
— |
|
|
— |
% |
| Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings |
|
103,809 |
|
|
26 |
|
|
0.05 |
% |
|
76,052 |
|
|
$ |
48 |
|
|
0.13 |
% |
|
Interest-bearing demand and money market accounts |
|
964,946 |
|
|
380 |
|
|
0.08 |
% |
|
800,797 |
|
|
1,805 |
|
|
0.45 |
% |
|
Certificates of deposit |
|
347,930 |
|
|
1,036 |
|
|
0.60 |
% |
|
381,828 |
|
|
3,128 |
|
|
1.64 |
% |
| Total Interest-bearing
deposits |
|
1,416,685 |
|
|
1,442 |
|
|
0.20 |
% |
|
1,258,677 |
|
|
4,981 |
|
|
0.79 |
% |
| Total deposits |
|
1,810,367 |
|
|
1,442 |
|
|
0.16 |
% |
|
1,548,150 |
|
|
4,981 |
|
|
0.64 |
% |
| Debt: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt |
|
27,282 |
|
|
83 |
|
|
0.61 |
% |
|
61,219 |
|
|
536 |
|
|
1.75 |
% |
|
Short-term borrowings |
|
— |
|
|
— |
|
|
— |
% |
|
14,805 |
|
|
97 |
|
|
1.31 |
% |
|
PPPLF advances |
|
— |
|
|
— |
|
|
— |
% |
|
43,666 |
|
|
76 |
|
|
0.35 |
% |
|
Subordinated notes |
|
19,482 |
|
|
503 |
|
|
5.16 |
% |
|
7,456 |
|
|
184 |
|
|
4.94 |
% |
|
Guaranteed preferred beneficial interest in junior subordinated
debentures |
|
12,000 |
|
|
150 |
|
|
2.50 |
% |
|
12,000 |
|
|
226 |
|
|
3.77 |
% |
| Total debt |
|
58,764 |
|
|
736 |
|
|
2.50 |
% |
|
139,146 |
|
|
1,119 |
|
|
1.61 |
% |
| Total interest-bearing
liabilities |
|
1,475,449 |
|
|
2,178 |
|
|
0.30 |
% |
|
1,397,823 |
|
|
6,100 |
|
|
0.87 |
% |
| Total funds |
|
1,869,131 |
|
|
2,178 |
|
|
0.23 |
% |
|
1,687,296 |
|
|
6,100 |
|
|
0.72 |
% |
| Other liabilities |
|
22,239 |
|
|
|
|
|
|
22,612 |
|
|
|
|
|
| Stockholders' equity |
|
202,516 |
|
|
|
|
|
|
186,580 |
|
|
|
|
|
| Total Liabilities and
Stockholders' Equity |
|
$ |
2,093,886 |
|
|
|
|
|
|
$ |
1,896,488 |
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest income |
|
|
|
$ |
32,944 |
|
|
|
|
|
|
$ |
29,577 |
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Interest rate spread |
|
|
|
|
|
3.36 |
% |
|
|
|
|
|
3.21 |
% |
| Net yield on interest-earning
assets |
|
|
|
|
|
3.43 |
% |
|
|
|
|
|
3.39 |
% |
| Average interest-earning
assets to average interest-bearing liabilities |
|
|
|
|
|
130.12 |
% |
|
|
|
|
|
124.99 |
% |
| Average loans to average
deposits |
|
|
|
|
|
88.09 |
% |
|
|
|
|
|
97.23 |
% |
| Average transaction deposits
to total average deposits ** |
|
|
|
|
|
80.78 |
% |
|
|
|
|
|
75.34 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Cost of funds |
|
|
|
|
|
0.23 |
% |
|
|
|
|
|
0.72 |
% |
| Cost of deposits |
|
|
|
|
|
0.16 |
% |
|
|
|
|
|
0.64 |
% |
| Cost of debt |
|
|
|
|
|
2.50 |
% |
|
|
|
|
|
1.61 |
% |
(1) Loan average balance
includes non-accrual loans. There are no tax equivalency
adjustments. There was $165,000 and $403,000 of accretion interest
during the six months ended June 30, 2021 and 2020,
respectively.____________________________________
** Transaction deposits exclude time deposits.
SUMMARY OF LOAN PORTFOLIO
(UNAUDITED)(dollars in thousands)
|
BY LOAN TYPE |
|
June 30, 2021 |
|
% |
|
March 31, 2021 |
|
% |
|
December 31, 2020 |
|
% |
|
September 30, 2020 |
|
% |
|
June 30, 2020 |
|
% |
|
Portfolio Type: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
|
$ |
1,111,613 |
|
|
72.47 |
|
% |
|
$ |
1,081,111 |
|
|
71.74 |
|
% |
|
$ |
1,049,147 |
|
|
69.75 |
|
% |
|
$ |
1,021,987 |
|
|
68.29 |
|
% |
|
$ |
996,111 |
|
|
66.73 |
|
% |
|
Residential first mortgages |
|
105,482 |
|
|
6.88 |
|
% |
|
115,803 |
|
|
7.68 |
|
% |
|
133,779 |
|
|
8.89 |
|
% |
|
147,756 |
|
|
9.87 |
|
% |
|
165,670 |
|
|
11.10 |
|
% |
|
Residential rentals |
|
142,210 |
|
|
9.27 |
|
% |
|
137,522 |
|
|
9.12 |
|
% |
|
139,059 |
|
|
9.24 |
|
% |
|
137,950 |
|
|
9.22 |
|
% |
|
132,590 |
|
|
8.88 |
|
% |
|
Construction and land development |
|
36,918 |
|
|
2.41 |
|
% |
|
38,446 |
|
|
2.55 |
|
% |
|
37,520 |
|
|
2.49 |
|
% |
|
36,061 |
|
|
2.41 |
|
% |
|
37,580 |
|
|
2.52 |
|
% |
|
Home equity and second mortgages |
|
28,726 |
|
|
1.87 |
|
% |
|
29,363 |
|
|
1.95 |
|
% |
|
29,129 |
|
|
1.94 |
|
% |
|
31,427 |
|
|
2.10 |
|
% |
|
33,873 |
|
|
2.27 |
|
% |
|
Commercial loans |
|
47,567 |
|
|
3.10 |
|
% |
|
42,689 |
|
|
2.83 |
|
% |
|
52,921 |
|
|
3.52 |
|
% |
|
58,894 |
|
|
3.94 |
|
% |
|
63,249 |
|
|
4.24 |
|
% |
|
Consumer loans |
|
1,442 |
|
|
0.09 |
|
% |
|
1,415 |
|
|
0.09 |
|
% |
|
1,027 |
|
|
0.07 |
|
% |
|
1,081 |
|
|
0.07 |
|
% |
|
1,117 |
|
|
0.07 |
|
% |
|
Commercial equipment |
|
59,918 |
|
|
3.91 |
|
% |
|
60,834 |
|
|
4.04 |
|
% |
|
61,693 |
|
|
4.10 |
|
% |
|
61,376 |
|
|
4.10 |
|
% |
|
62,555 |
|
|
4.19 |
|
% |
| Gross portfolio loans |
|
1,533,876 |
|
|
100.00 |
|
% |
|
1,507,183 |
|
|
100.00 |
|
% |
|
1,504,275 |
|
|
100.00 |
|
% |
|
1,496,532 |
|
|
100.00 |
|
% |
|
1,492,745 |
|
|
100.00 |
|
% |
| Net deferred costs |
|
533 |
|
|
0.03 |
|
% |
|
879 |
|
|
0.06 |
|
% |
|
1,264 |
|
|
0.08 |
|
% |
|
1,610 |
|
|
0.11 |
|
% |
|
2,072 |
|
|
0.14 |
|
% |
| Allowance for loan losses |
|
(18,516 |
) |
|
(1.21 |
) |
% |
|
(18,256 |
) |
|
(1.21 |
) |
% |
|
(19,424 |
) |
|
(1.29 |
) |
% |
|
(18,829 |
) |
|
(1.26 |
) |
% |
|
(16,319 |
) |
|
(1.09 |
) |
% |
| |
|
(17,983 |
) |
|
|
|
(17,377 |
) |
|
|
|
(18,160 |
) |
|
|
|
(17,219 |
) |
|
|
|
(14,247 |
) |
|
|
| Net portfolio loans |
|
$ |
1,515,893 |
|
|
|
|
$ |
1,489,806 |
|
|
|
|
$ |
1,486,115 |
|
|
|
|
$ |
1,479,313 |
|
|
|
|
$ |
1,478,498 |
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. SBA PPP loans |
|
$ |
89,129 |
|
|
|
|
$ |
115,700 |
|
|
|
|
$ |
110,320 |
|
|
|
|
$ |
131,088 |
|
|
|
|
$ |
129,384 |
|
|
|
| Net deferred fees |
|
(2,647 |
) |
|
|
|
(3,215 |
) |
|
|
|
(2,360 |
) |
|
|
|
(3,277 |
) |
|
|
|
(3,746 |
) |
|
|
| Net U.S. SBA PPP loans |
|
$ |
86,482 |
|
|
|
|
$ |
112,485 |
|
|
|
|
$ |
107,960 |
|
|
|
|
$ |
127,811 |
|
|
|
|
$ |
125,638 |
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total net loans |
|
$ |
1,602,375 |
|
|
|
|
$ |
1,602,291 |
|
|
|
|
$ |
1,594,075 |
|
|
|
|
$ |
1,607,124 |
|
|
|
|
$ |
1,604,136 |
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross loans |
|
$ |
1,623,005 |
|
|
|
|
$ |
1,622,883 |
|
|
|
|
$ |
1,614,595 |
|
|
|
|
$ |
1,627,620 |
|
|
|
|
$ |
1,622,129 |
|
|
|
END OF PERIOD CONTRACTUAL RATES
(UNAUDITED)
The following table is based on contractual
interest rates and does not include the amortization of deferred
costs and fees or assumptions regarding non-accrual
interest:
| |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
(dollars in thousands) |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
|
EOP Contractual Interest rate |
|
Commercial real estate |
|
3.96 |
% |
|
4.02 |
% |
|
4.11 |
% |
|
4.20 |
% |
|
4.32 |
% |
| Residential first
mortgages |
|
3.87 |
% |
|
3.87 |
% |
|
3.93 |
% |
|
3.93 |
% |
|
3.93 |
% |
| Residential rentals |
|
4.11 |
% |
|
4.20 |
% |
|
4.26 |
% |
|
4.30 |
% |
|
4.45 |
% |
| Construction and land
development |
|
4.31 |
% |
|
4.32 |
% |
|
4.28 |
% |
|
4.40 |
% |
|
4.46 |
% |
| Home equity and second
mortgages |
|
3.50 |
% |
|
3.52 |
% |
|
3.54 |
% |
|
3.56 |
% |
|
3.56 |
% |
| Commercial loans |
|
4.44 |
% |
|
4.63 |
% |
|
4.56 |
% |
|
4.51 |
% |
|
4.53 |
% |
| Consumer loans |
|
5.65 |
% |
|
5.75 |
% |
|
5.99 |
% |
|
5.94 |
% |
|
6.05 |
% |
| Commercial equipment |
|
4.42 |
% |
|
4.40 |
% |
|
4.42 |
% |
|
4.42 |
% |
|
4.44 |
% |
| U.S. SBA PPP loans |
|
1.00 |
% |
|
1.00 |
% |
|
1.00 |
% |
|
1.00 |
% |
|
1.00 |
% |
| Total
loans |
|
3.84 |
% |
|
3.84 |
% |
|
3.92 |
% |
|
3.94 |
% |
|
4.03 |
% |
| |
|
|
|
|
|
|
|
|
|
|
| Yields without U.S.
SBA PPP loans |
|
4.00 |
% |
|
4.06 |
% |
|
4.13 |
% |
|
4.20 |
% |
|
4.29 |
% |
ALLOWANCE FOR LOAN LOSSES
(UNAUDITED)
|
(dollars in thousands) |
|
For the Three Months Ended |
| |
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
Beginning of period |
|
$ |
18,256 |
|
|
|
$ |
19,424 |
|
|
|
$ |
18,829 |
|
|
|
$ |
16,319 |
|
|
|
$ |
15,061 |
|
|
| |
|
|
|
|
|
|
|
|
|
|
| Charge-offs |
|
(61 |
) |
|
|
(1,485 |
) |
|
|
(30 |
) |
|
|
(65 |
) |
|
|
(2,262 |
) |
|
| Recoveries |
|
30 |
|
|
|
22 |
|
|
|
25 |
|
|
|
75 |
|
|
|
20 |
|
|
| Net charge-offs |
|
(31 |
) |
|
|
(1,463 |
) |
|
|
(5 |
) |
|
|
10 |
|
|
|
(2,242 |
) |
|
| |
|
|
|
|
|
|
|
|
|
|
| Provision for loan losses |
|
291 |
|
|
|
295 |
|
|
|
600 |
|
|
|
2,500 |
|
|
|
3,500 |
|
|
| End of period |
|
$ |
18,516 |
|
|
|
$ |
18,256 |
|
|
|
$ |
19,424 |
|
|
|
$ |
18,829 |
|
|
|
$ |
16,319 |
|
|
| |
|
|
|
|
|
|
|
|
|
|
| Net charge-offs to average
portfolio loans (annualized)(1) |
|
(0.01 |
) |
% |
|
(0.40 |
) |
% |
|
— |
|
% |
|
— |
|
% |
|
(0.61 |
) |
% |
| |
|
|
|
|
|
|
|
|
|
|
| Breakdown
of general and specific allowance as a percentage of gross
portfolio loans(1) |
|
|
|
|
|
|
|
|
| General allowance |
|
$ |
17,686 |
|
|
|
$ |
17,365 |
|
|
|
$ |
18,068 |
|
|
|
$ |
18,319 |
|
|
|
$ |
16,215 |
|
|
| Specific allowance |
|
778 |
|
|
|
891 |
|
|
|
1,356 |
|
|
|
510 |
|
|
|
104 |
|
|
| Total allowance to
non-acquired loans |
|
$ |
18,464 |
|
|
|
$ |
18,256 |
|
|
|
$ |
19,424 |
|
|
|
$ |
18,829 |
|
|
|
$ |
16,319 |
|
|
| PCI loans |
|
52 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
| Total allowance to gross
portfolio loans with PCI loans |
|
$ |
18,516 |
|
|
|
$ |
18,256 |
|
|
|
$ |
19,424 |
|
|
|
$ |
18,829 |
|
|
|
$ |
16,319 |
|
|
| |
|
|
|
|
|
|
|
|
|
|
| General allowance |
|
1.15 |
|
% |
|
1.15 |
|
% |
|
1.20 |
|
% |
|
1.22 |
|
% |
|
1.09 |
|
% |
| Specific allowance |
|
0.05 |
|
% |
|
0.06 |
|
% |
|
0.09 |
|
% |
|
0.03 |
|
% |
|
0.01 |
|
% |
| Total allowance to gross
portfolio loans(1) |
|
1.20 |
|
% |
|
1.21 |
|
% |
|
1.29 |
|
% |
|
1.26 |
|
% |
|
1.09 |
|
% |
| Total allowance to gross
portfolio loans with PCI loans(2) |
|
1.21 |
|
% |
|
— |
|
% |
|
— |
|
% |
|
— |
|
% |
|
— |
|
% |
| |
|
|
|
|
|
|
|
|
|
|
| Allowance to non-acquired
gross loans(3) |
|
1.25 |
|
% |
|
1.26 |
|
% |
|
1.35 |
|
% |
|
1.31 |
|
% |
|
1.14 |
|
% |
| |
|
|
|
|
|
|
|
|
|
|
| Allowance+ Non-PCI FV
Mark |
|
$ |
19,090 |
|
|
|
$ |
18,939 |
|
|
|
$ |
20,174 |
|
|
|
$ |
19,643 |
|
|
|
$ |
17,208 |
|
|
| Allowance+ Non-PCI FV Mark to
gross portfolio loans |
|
1.24 |
|
% |
|
1.26 |
|
% |
|
1.34 |
|
% |
|
1.31 |
|
% |
|
1.15 |
|
% |
____________________________________(1)
Portfolio loans include all loan portfolios except the U.S. SBA PPP
loan portfolio (2) There were no allowance for loan loss on the PCI
portfolios prior to the three months ended June 30, 2021. (3)
Non-acquired loans include loans transferred from acquired pools
following release of acquisition accounting FMV adjustments.
Non-acquired loans exclude U.S. SBA PPP loans. Below are several
schedules that provide information on the COVID-19 deferred loans.
The schedules summarize the COVID-19 loan modifications by loan
portfolio, maturity or next payment due dates and the Banks's
industry classification using the North American Industry
Classification System ("NAICS"). The NAICS is the standard used by
Federal statistical agencies in classifying business establishments
for the purpose of collecting, analyzing, and publishing
statistical data related to the U.S. business economy.
| |
|
(UNAUDITED) |
|
COVID-19 Deferred Loans |
|
June 30, 2021 |
|
Accrual Loans |
|
Non-Accrual Loans |
|
(dollars in thousands) |
|
Loan Balances |
|
% of Deferred Loans |
|
% of Gross Portfolio Loans |
|
Loan Balances |
|
Number of Loans |
|
Loan Balances |
|
Number of Loans |
|
Commercial equipment |
|
3,505 |
|
|
100.00 |
% |
|
0.23 |
% |
|
3,505 |
|
|
11 |
|
— |
|
|
— |
|
Total |
|
$ |
3,505 |
|
|
100.00 |
% |
|
0.23 |
% |
|
$ |
3,505 |
|
|
11 |
|
$ |
— |
|
|
— |
|
COVID-19 Deferred Loans - Scheduled Month off
Deferral |
|
(UNAUDITED) |
|
(dollars in thousands) |
|
Loan Balances |
|
% |
|
Number of Loans |
|
December-21 |
|
3,505 |
|
|
100.00 |
% |
|
11 |
|
Total |
|
$ |
3,505 |
|
|
100.00 |
% |
|
11 |
|
COVID-19 Deferred Loans by NAICS Industry |
|
(UNAUDITED) |
|
(dollars in thousands) |
|
June 30, 2021 |
|
Number of Loans |
|
Transportation and Warehousing |
|
3,505 |
|
|
11 |
|
Total |
|
$ |
3,505 |
|
|
11 |
CLASSIFIED AND SPECIAL MENTION ASSETS
(UNAUDITED)
The following is a breakdown of the Company’s classified and
special mention assets at June 30, 2021
and December 31, 2020, 2019, 2018, and 2017,
respectively:
| |
As of |
|
(dollars in thousands) |
|
6/30/2021 |
|
3/31/2021 |
|
12/31/2020 |
|
12/31/2019 |
|
12/31/2018 |
|
12/31/2017 |
|
Classified loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
Substandard |
|
$ |
13,382 |
|
|
$ |
13,816 |
|
|
$ |
19,249 |
|
|
$ |
26,863 |
|
|
$ |
32,226 |
|
|
$ |
40,306 |
|
|
Doubtful |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
| Total classified loans |
|
13,382 |
|
|
13,816 |
|
|
19,249 |
|
|
26,863 |
|
|
32,226 |
|
|
40,306 |
|
| Special mention loans |
|
4,524 |
|
|
7,769 |
|
|
7,672 |
|
|
— |
|
|
— |
|
|
96 |
|
| Total classified and special
mention loans |
|
$ |
17,906 |
|
|
$ |
21,585 |
|
|
$ |
26,921 |
|
|
$ |
26,863 |
|
|
$ |
32,226 |
|
|
$ |
40,402 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Classified loans |
|
$ |
13,382 |
|
|
$ |
13,816 |
|
|
$ |
19,249 |
|
|
$ |
26,863 |
|
|
$ |
32,226 |
|
|
$ |
40,306 |
|
| Classified securities |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
482 |
|
|
651 |
|
| Other real estate owned |
|
1,536 |
|
|
2,329 |
|
|
3,109 |
|
|
7,773 |
|
|
8,111 |
|
|
9,341 |
|
| Total classified assets |
|
$ |
14,918 |
|
|
$ |
16,145 |
|
|
$ |
22,358 |
|
|
$ |
34,636 |
|
|
$ |
40,819 |
|
|
$ |
50,298 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Total classified
assets as a percentage of total assets |
|
0.68 |
% |
|
0.75 |
% |
|
1.10 |
% |
|
1.93 |
% |
|
2.42 |
% |
|
3.58 |
% |
| Total classified
assets as a percentage of Risk Based Capital |
|
6.24 |
% |
|
6.81 |
% |
|
9.61 |
% |
|
16.21 |
% |
|
21.54 |
% |
|
32.10 |
% |
SUMMARY OF DEPOSITS
(UNAUDITED)
| |
|
June 30, 2021 |
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30, 2020 |
|
(dollars in thousands) |
|
Balance |
|
% |
|
Balance |
|
% |
|
Balance |
|
% |
|
Balance |
|
% |
|
Balance |
|
% |
|
Noninterest-bearing demand |
|
$ |
423,165 |
|
|
22.18 |
% |
|
$ |
406,319 |
|
|
21.75 |
% |
|
$ |
362,079 |
|
|
20.74 |
% |
|
$ |
360,839 |
|
|
20.28 |
% |
|
$ |
356,196 |
|
|
21.32 |
% |
| Interest-bearing: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand |
|
685,023 |
|
|
35.90 |
% |
|
651,639 |
|
|
34.89 |
% |
|
590,159 |
|
|
33.81 |
% |
|
635,176 |
|
|
35.69 |
% |
|
547,639 |
|
|
32.79 |
% |
|
Money market deposits |
|
351,262 |
|
|
18.41 |
% |
|
355,680 |
|
|
19.04 |
% |
|
340,725 |
|
|
19.52 |
% |
|
329,617 |
|
|
18.52 |
% |
|
314,781 |
|
|
18.85 |
% |
|
Savings |
|
107,288 |
|
|
5.62 |
% |
|
105,590 |
|
|
5.65 |
% |
|
98,783 |
|
|
5.66 |
% |
|
90,514 |
|
|
5.09 |
% |
|
85,257 |
|
|
5.10 |
% |
|
Certificates of deposit |
|
341,400 |
|
|
17.89 |
% |
|
348,668 |
|
|
18.67 |
% |
|
353,856 |
|
|
20.27 |
% |
|
363,460 |
|
|
20.42 |
% |
|
366,491 |
|
|
21.94 |
% |
| Total interest-bearing |
|
1,484,973 |
|
|
77.82 |
% |
|
1,461,577 |
|
|
78.25 |
% |
|
1,383,523 |
|
|
79.26 |
% |
|
1,418,767 |
|
|
79.72 |
% |
|
1,314,168 |
|
|
78.68 |
% |
| Total deposits |
|
$ |
1,908,138 |
|
|
100.00 |
% |
|
$ |
1,867,896 |
|
|
100.00 |
% |
|
$ |
1,745,602 |
|
|
100.00 |
% |
|
$ |
1,779,606 |
|
|
100.00 |
% |
|
$ |
1,670,364 |
|
|
100.00 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Transaction
accounts |
|
$ |
1,566,738 |
|
|
82.11 |
% |
|
$ |
1,519,228 |
|
|
81.33 |
% |
|
$ |
1,391,746 |
|
|
79.73 |
% |
|
$ |
1,416,146 |
|
|
79.58 |
% |
|
$ |
1,303,873 |
|
|
78.06 |
% |
Community Financial (NASDAQ:TCFC)
Historical Stock Chart
From Mar 2024 to Apr 2024
Community Financial (NASDAQ:TCFC)
Historical Stock Chart
From Apr 2023 to Apr 2024
