JOHNSTOWN, Pa., Jan. 26, 2021
/PRNewswire/ -- AmeriServ Financial, Inc. (NASDAQ: ASRV)
reported fourth quarter 2020 net income of $692,000, or $0.04
per diluted common share. This earnings performance
represents a $23,000, or 3.4%,
increase from the fourth quarter of 2019 when net income totaled
$669,000, or $0.04 per diluted common share. For the
year ended December 31, 2020, the
Company reported net income of $4,598,000, or $0.27 per diluted common share. This
represents a 22.9% decrease in earnings per share from the full
year of 2019 when net income totaled $6,028,000, or $0.35 per diluted common share. The
following table highlights the Company's financial performance for
both the three and twelve month periods ended December 31, 2020 and 2019:
|
Fourth
Quarter
2020
|
Fourth
Quarter
2019
|
|
Year Ended
December 31, 2020
|
Year Ended
December 31, 2019
|
|
|
|
|
|
|
Net income
|
$692,000
|
$669,000
|
|
$4,598,000
|
$6,028,000
|
Diluted
earnings per share
|
$ 0.04
|
$ 0.04
|
|
$ 0.27
|
$ 0.35
|
Jeffrey A. Stopko, President and
Chief Executive Officer, commented on the 2020 financial results:
"The resiliency of our community bank customer-focused business
model was evident in 2020 as we dealt with the many unexpected
challenges resulting from the COVID-19 pandemic. We
experienced record levels of both loans and deposits as we served
as an important financial resource to small businesses and
consumers in our marketplace. As a result of our conservative risk
management posture, we prudently built our allowance for loan
losses to address increased credit risk in certain sectors of our
loan portfolio which was a primary factor causing the decline in
earnings between years. The good diversification of our
revenue was evident as 31% of our total revenue in 2020 came from
non-interest income sources which included record contributions
from our strong wealth management business and active residential
mortgage operation. Overall, we enter 2021 with a strong
balance sheet that we believe will be further enhanced with
additional deposits within our core markets when we close a
profitable branch acquisition in Somerset County that we previously
announced."
The Company's net interest income in the fourth quarter of 2020
increased by $392,000, or 4.4%, from
the prior year's fourth quarter and, for the full year of 2020,
increased by $925,000, or 2.6%, when
compared to the full year of 2019. The Company's net interest
margin of 3.12% for the fourth quarter of 2020 and 3.19% for the
full year of 2020 was 14 basis points lower than last year's fourth
quarter results and was 10 basis points lower when compared to the
full year of 2019. Fourth quarter 2020 results were
indicative of the low interest rate environment and the continued
slow economic recovery currently being experienced due to the
uncertainty and volatility resulting from the pandemic.
COVID-19 cases increased during the quarter leading to government
officials recommending and re-implementing certain safety measures
and restrictions on businesses and individuals. As a result,
AmeriServ once again closed our lobbies to customer traffic, but
continued to service our customers through drive up access.
Despite these pandemic related challenges, our balance sheet
experienced robust growth in 2020 which caused the increase in net
interest income despite the decline in the net interest margin due
to pressures from the low interest rate environment. The increase
to net interest income along with a higher level of non-interest
income was more than offset by an increased loan loss provision and
higher non-interest expense resulting in a lower earnings
performance for the full year of 2020.
Specifically, our loan portfolio benefitted from the increasing
commercial loan production that began late in the third quarter and
continued throughout the fourth quarter. We also continued to
experience strong residential mortgage loan production. This
commercial real estate and residential mortgage loan growth
combined with AmeriServ's early participation in the Small Business
Administration's (SBA) 100% guaranteed Paycheck Protection Program
(PPP) and the impact of other government sponsored initiatives
resulted in a higher level of both loans and deposits which
remained on the balance sheet throughout the year. Overall,
the average balance of total interest earning assets for both the
fourth quarter of 2020 and the full year time periods is higher
compared to the same time periods in 2019. Significantly
contributing to the loan growth in 2020 was the addition of the PPP
loans to the balance sheet. The level of PPP loans did
decrease by approximately $10 million
since the end of the third quarter of 2020 as we work through the
forgiveness process with our customers. Similar to the record
level of total loans that we have experienced, total deposits are
also at record levels. Both non-interest and interest bearing
deposits increased since last year primarily because of government
stimulus and consumers changing their spending habits because of
the pandemic. The low interest rate environment is positively
impacting deposit and borrowings interest expense cost.
Effective management of our funding costs along with the downward
repricing of certain interest bearing liabilities tied to market
indices resulted in total interest expense decreasing nicely
between years. This decrease to total interest expense more
than offset the decrease in total interest income resulting in the
increase to net interest income for both the fourth quarter and
full year of 2020.
Total loans reached a new record level and averaged $970 million in the fourth quarter of 2020 which
is $93.3 million, or 10.6%, higher
than the $877 million average for the
fourth quarter of 2019, while total average loans for the full year
of 2020 were $48.1 million, or 5.5%,
higher than the 2019 full year average. Contributing to the
growth in total average loans was the Company's participation in
the PPP program, robust residential mortgage loan production and
the return of more normal commercial loan growth later in the
year. During 2020, the Company processed 477 PPP loans
totaling $68.7 million to assist
small businesses and our community in this difficult economy.
Also, the Company recorded a total of $1.9
million of processing fee income and interest income from
PPP lending activity. The remaining portion of PPP processing
fees totals approximately $755,000
and is being amortized into income over the time period that the
loans remain on our balance sheet or until the PPP loan is forgiven
at which time the remaining fee will be recognized immediately as
income. In late December 2020,
the Federal Government passed a new $900
billion pandemic relief bill which includes $284.5 billion for the re-opening of the SBA
Paycheck Protection Program. The Company will again assist
our business customers and participate in the program in 2021.
Normal commercial lending production improved during the final
four months of the year with commercial loan pipelines also
improving to pre-COVID levels. Overall, on an end of period
basis and excluding total PPP loans, the total loan portfolio grew
by approximately $39.1 million since
September 30, 2020. Residential
mortgage loan production continued to be exceptionally strong and
reached a record level given the lower interest rate
environment. For the full year of 2020, residential mortgage
loan production totaled $142 million
and was 139% higher than the production level of $60 million achieved for the full year of
2019. Even though total average loans increased compared to
the same time periods last year and loan interest income was
enhanced by the PPP revenue, loan interest and fee income decreased
by $660,000, or 6.1%, for the quarter
and also declined by $2.3 million, or
5.4%, for the full year. The lower loan interest income
reflects the challenges that this record low interest rate
environment has created. New loans are being originated at
lower yields and certain loans tied to LIBOR or the prime rate
reprice downward as both of these indices have moved down with the
Federal Reserve's decision to decrease the target federal funds
interest rate by a total of 225 basis points since June of
2019. The Company remains committed to continue working
prudently with our borrowers that have been negatively impacted
from the effects of this difficult economy. In 2020, the
Company, as suggested by the Federal Reserve, granted loan payment
modifications to customers experiencing difficulty during this
tough economic time. Requested modifications primarily
consist of the deferral of principal and/or interest payments for a
period of three to six months and maturity date extensions.
Initially, the balance of loan modifications related to COVID-19
that were granted to our customers totaled $200 million. At December 31, 2020, 70 loans for approximately
$49.1 million, or 5.0% of total
loans, were on a payment modification plan, most of which are
borrowers who were granted a second loan payment deferral.
Management is carefully monitoring asset quality with a particular
focus on customers that have requested these payment
deferrals. As we reached the end of the initial deferral time
periods, deferral extension requests were considered based upon the
customer's needs and their impacted industry, borrower and
guarantor capacity to service debt as well as issued regulatory
guidance.
Total investment securities averaged $188
million for the full year of 2020 which is $6.2 million, or 3.2%, lower than the
$194 million average for 2019.
The Company was selective in 2020 when purchasing the more typical
types of securities that have been purchased historically as the
market was less favorable for purchases, offering a lower return
given the differences in the position and shape of the U.S.
Treasury yield curve from last year. To somewhat offset the
unfavorable market for the more traditional types of purchases, the
Company has been active since March purchasing corporate
securities, particularly subordinated debt issued by other
financial institutions along with taxable municipal
securities. Subordinated debt offers higher yields than the
typical types of securities in which we invest and is particularly
attractive given the current low interest rate environment and flat
shape of the yield curve. Management believes it to be
acceptable to increase our investments in bank subordinated debt in
a gradual and diversified manner, given the heavily regulated
nature of the industry combined with our intensive due diligence
process and adherence to our internal guidelines for these types of
investments.
Our liquidity position continues to be strong due to the
significant influx of deposits that resulted from the government
stimulus programs and as customers continue to be cautious and are
demonstrating reduced spending activity due to the economic
uncertainty. As described in our third quarter earnings
release, average short-term investments were higher than they have
been historically which presented the challenge of profitably
deploying this excess liquidity given a steady decline in yields on
short term investment products as 2020 progressed. The
pressure to find a suitable return on these excess liquid funds
eased during the fourth quarter given the loan growth that
occurred. Due to the loan growth, short term investment
balances returned to a more normal, lower level in the fourth
quarter of 2020. Interest income on total investments
decreased between the full year of 2020 and full year of 2019 by
$580,000, or 8.5%. Overall,
total interest income on loans and investments decreased by
$2.9 million, or 5.8%, between
years.
Total interest expense for the full year of 2020 decreased by
$3.8 million, or 26.6%, when compared
to 2019, due to lower levels of both deposit and borrowing interest
expense. Deposit interest expense in the full year of 2020
was lower by $3.6 million, or
31.8%. Total average deposits, again, reached a record level,
averaging $1.067 billion for the
quarter, which is $82.4 million, or
8.4%, higher than the 2019 fourth quarter average reflecting the
benefit of government stimulus programs and reduced consumer
spending in 2020. In addition, the Company's loyal core
deposit base continues to be a source of strength for the Company
during periods of market volatility. Management continued to
effectively execute several deposit product pricing decreases given
the low interest rate environment and the downward pressure that
the low interest rates are having on the net interest margin.
As a result, the Company experienced deposit cost relief.
Overall, total deposit cost, including demand deposits, averaged
0.59% in the fourth quarter of 2020 compared to 1.09% in the fourth
quarter of 2019 or a meaningful decrease of 50 basis points.
The Company's loan to deposit ratio averaged 90.9% in the fourth
quarter of 2020 which we believe indicates that the Company has
ample capacity to continue to grow its loan portfolio and is well
positioned to continue assisting our customers and the community
given the impact that the COVID-19 pandemic is having on the
economy.
The Company experienced a $255,000, or 8.1%, decrease in the interest cost
of borrowings in the full year of 2020 when compared to the full
year of 2019. The decline is a result of the Federal
Reserve's actions to decrease interest rates and the impact that
these rate decreases have on the cost of overnight borrowed funds
and the replacement of matured FHLB term advances. The total
2020 full year average term advance borrowings balance increased by
approximately $11.7 million, or
22.4%, when compared to the full year of 2019 as the Company took
advantage of the lower yield curve to prudently extend
borrowings. The rate on certain FHLB term advances is lower
than the rate on overnight borrowings. As a result, the
combined growth of average FHLB term advances and total average
deposits resulted in less reliance on overnight borrowed funds,
which decreased between years by $6.1
million. Overall, the 2020 full year average of total
short-term and FHLB borrowed funds was $69.0
million, which represents an increase of $5.6 million, or 8.8%, from 2019.
The Company recorded a $1,075,000
provision expense for loan losses in the fourth quarter of 2020 as
compared to a $975,000 provision
expense recorded in the fourth quarter of 2019. For the full
year of 2020, the Company recorded a $2,375,000 provision expense for loan losses
compared to an $800,000 provision
expense recorded in the full year of 2019. The Company
continues to build the allowance for loan losses given the overall
economic climate and the uncertainty that exists because of the
COVID-19 pandemic. The 2020 provision reflects management
strengthening certain qualitative factors within the allowance for
loan losses calculation and downgrades of loan relationships that
are reflective of the industries that have been especially
negatively impacted from the pandemic and are demonstrating a slow
pace of recovery. Earlier this year, several loans from the
hotel industry were downgraded. The downgrade of a
hospitality related credit and a large transportation related
credit, as well as the loan growth experienced during the fourth
quarter also resulted in the provision increasing between the third
and fourth quarters of 2020. The recovery efforts of many of
these borrowers experiencing a downgrade stalled during the fourth
quarter due to the rise in COVID cases which caused additional
safety measures and restrictions to be put in place on their
businesses. While these borrowers will need additional time
to recover, we remain encouraged by their efforts to work through
the pandemic and signs of improvement in their operations.
The Company experienced low net loan charge-offs of $309,000, or 0.03% of total loans, in 2020
compared to net loan charge-offs of $192,000, or 0.02% of total loans, for
2019. As a result of the provision expense sharply exceeding
net loan charge-offs, the balance in the allowance for loan losses
increased by over $2 million in
2020. Non-performing assets totaled $3.3 million, or 0.34% of total loans, at
December 31, 2020, and are below
industry levels. As mentioned previously, management is
carefully monitoring asset quality with a particular focus on loan
customers that have requested a second payment deferral during this
difficult economic time. The Asset Quality Task Force is
meeting at least monthly to review these particular relationships,
receiving input from the business lenders regarding their ongoing
discussions with the borrowers. In summary, the allowance for
loan losses provided 341% coverage of non-performing assets, and
1.16% of total loans, at December 31,
2020, compared to 397% coverage of non-performing assets,
and 1.05% of total loans, at December
31, 2019. Note that the reserve coverage of total
loans, excluding PPP loans, is 1.23%(1) at December 31, 2020. The Small Business
Administration guarantees 100% of the PPP loans made to eligible
borrowers which minimizes the level of credit risk associated with
these loans.
Total non-interest income in the fourth quarter of 2020
increased by $956,000, or 28.0%, from
the prior year's fourth quarter, and increased by $1,502,000, or 10.2%, for the full year of 2020
when compared to the full year of 2019. A significant factor
contributing to the improvement in both time periods was the
Company recognizing a $500,000
impairment charge on a Community Reinvestment Act (CRA) related
investment in 2019 and there was no charge in 2020 since the full
investment was written off last year. The more normal types
of activity between years included: income from residential
mortgage loan sales into the secondary market increased by
$153,000, or 52.6%, for the quarter
and increased by $658,000, or 76.1%,
for the full year due to the record level of residential mortgage
loan production. The higher level of residential mortgage
loan production also resulted in mortgage related fees increasing
by $43,000, or 51.2%, for the quarter
and by $257,000, or 85.1%, for the
full year. Wealth management fees increased by $99,000, or 4.0%, in the fourth quarter of 2020
and by $482,000, or 5.0%, for the
full year of 2020 compared to the same time periods in 2019.
In addition to an improved level of fee income from the financial
services business unit, the entire wealth management division has
been resilient and performed well in spite of the major market
value decline that occurred in late March. The market value
of wealth management assets recovered and improved from the
pre-pandemic valuation, exceeding the March
31, 2020 market value by 25% and also exceeding the market
value as of December 31, 2019 by
11%. Revenue from bank owned life insurance increased by
$211,000 for the quarter and
$261,000 for the full year due to the
receipt of a $91,000 death claim and
a financial floor taking hold which caused increased earnings and a
higher rate of return on certain policies. Somewhat
offsetting these favorable items was service charges on deposit
accounts decreasing by $88,000, or
27.2%, for the quarter and by $368,000, or 29.0%, for the full year.
Consumer spending activity-based fees such as deposit service
charges, which include overdraft fees, decreased significantly with
the shutdown of the economy and has been slow to improve given the
pace of the economic recovery. Finally, the Company did not
recognize a gain or loss on security sales in 2020 after a
$118,000 gain was recognized last
year.
The Company's total non-interest expense in the fourth quarter
of 2020 increased by $1.1 million, or
10.8%, when compared to the fourth quarter of 2019 and increased
for the full year of 2020 by $2.6
million, or 6.3%, when compared to 2019. The increase
in both time periods was partly due to higher salaries &
benefits expense of $773,000, or
12.0%, for the quarter and $2.0
million, or 7.7%, for the full year of 2020. Within
salaries & benefits, factors causing the increase included
increased health care costs ($95,000,
or 12.4%, for the quarter and $424,000, or 13.9%, for the full year) and
greater incentive compensation ($316,000, or 114.5%, for the quarter and
$645,000, or 57.9%, for the full
year) primarily due to commissions earned as a result of increased
residential mortgage loan production. Additionally, pension
expense increased by $59,000, or
12.3%, for the quarter and $506,000,
or 30.4%, for the full year when 2020 is compared to 2019.
The significant increase between years results from the unfavorable
impact that the lower interest rate environment has on the discount
rates that are used to revalue the defined benefit pension
obligation each year. Total salaries are also higher by
$341,000, or 7.6%, for the quarter
and by $625,000, or 3.5%, for the
year primarily due to separation costs related to the elimination
of a management position and merit increases. Total
professional fees increased by $121,000, or 9.8%, in the fourth quarter of 2020
and by $334,000, or 6.8%, for the
year. The increase results from higher appraisal fees due to
the significantly higher level of residential mortgage loan
production, higher legal fees related to PPP loan processing,
personnel related matters and an increased level of outside
professional services related costs. FDIC deposit insurance
expense is $245,000 higher for the
quarter and $381,000 higher for the
year as this line returned to a more normal level after the benefit
from the application of the Small Bank Assessment Credit regulation
expired earlier this year. Finally, and slightly offsetting
the higher year over year expenses was other expense comparing
favorably to 2019 by $98,000, or
1.3%, for the full year due to reduced outside processing fees and
telephone costs as well as a lower level of meals & travel
costs that is related to travel restrictions from the
pandemic. The favorable comparison for other expense also
resulted from a reduction recognized earlier in the year for the
unfunded commitment reserve.
The Company recorded an income tax expense of $248,000, or an effective tax rate of 26.4%, in
the fourth quarter of 2020. This compares to an income tax
expense of $169,000, or an effective
tax rate of 20.2%, for the fourth quarter of 2019. The higher
effective tax rate and income tax expense in the fourth quarter of
2020 reflected the recognition of additional income tax expense due
to the write-off of a deferred tax asset that will not be realized
due to the dissolution of the Company's small life insurance
subsidiary. Overall, for the full year of 2020, the Company
recorded income tax expense of $1.2
million, or an effective tax rate of 20.9%, compared to
income tax expense of $1.6 million in
2019, or an effective tax rate of 20.7%.
The Company had total assets of $1.28
billion, shareholders' equity of $104.4 million, a book value of $6.12 per common share and a tangible book
value(1) of $5.42 per
common share at December 31,
2020. Tangible book value increased by $0.34 since December
31, 2019. The Company continued to maintain strong
capital ratios that exceed the regulatory defined well capitalized
status.
QUARTERLY COMMON STOCK CASH DIVIDEND
The Company's Board of Directors declared a $0.025 per share quarterly common stock cash
dividend. The cash dividend is payable February 22, 2021 to shareholders of record on
February 8, 2021. This cash
dividend represents a 2.9% annualized yield using the January 19, 2021 closing stock price of
$3.50. For the full year of
2020, the Company's dividend payout ratio amounted to 37.0%.
Forward-Looking Statements
This press release contains forward-looking statements as
defined in the Securities Exchange Act of 1934 and is subject to
the safe harbors created therein. Such statements are not
historical facts and include expressions about management's
confidence and strategies and management's current views and
expectations about new and existing programs and products,
relationships, opportunities, technology, market conditions,
dividend program, proposed branch acquisition, including the
timing, anticipated benefits, and financial impact thereof, and
future payment obligations. These statements may be identified
by such forward-looking terminology as "continuing," "expect,"
"look," "believe," "anticipate," "may," "will," "should,"
"projects," "strategy," or similar statements. Actual results may
differ materially from such forward-looking statements, and no
reliance should be placed on any forward-looking statement. Factors
that may cause results to differ materially from such
forward-looking statements include, but are not limited to,
unanticipated changes in the financial markets and the direction of
interest rates; volatility in earnings due to certain financial
assets and liabilities held at fair value; competition levels; loan
and investment prepayments differing from our assumptions;
insufficient allowance for credit losses; a higher level of loan
charge-offs and delinquencies than anticipated; material adverse
changes in our operations or earnings; a decline in the economy in
our market areas; changes in relationships with major customers;
changes in effective income tax rates; higher or lower cash flow
levels than anticipated; inability to hire or retain qualified
employees; a decline in the levels of deposits or loss of alternate
funding sources; a decrease in loan origination volume or an
inability to close loans currently in the pipeline; changes in laws
and regulations; adoption, interpretation and implementation of
accounting pronouncements; operational risks, including the risk of
fraud by employees, customers or outsiders; unanticipated effects
of our banking platform; risks and uncertainties relating to the
duration of the COVID-19 pandemic, and actions that may be taken by
governmental authorities to contain the pandemic or to treat its
impact; and the inability to successfully implement or expand new
lines of business or new products and services. These
forward-looking statements involve risks and uncertainties that
could cause AmeriServ's results to differ materially from
management's current expectations. Such risks and uncertainties are
detailed in AmeriServ's filings with the Securities and Exchange
Commission, including our Annual Report on Form 10-K for the year
ended December 31, 2019.
Forward-looking statements are based on the beliefs and assumptions
of AmeriServ's management and on currently available information.
The statements in this press release are made as of the date of
this press release, even if subsequently made available by
AmeriServ on its website or otherwise. AmeriServ undertakes no
responsibility to publicly update or revise any forward-looking
statement.
(1) Non-GAAP Financial
Information. See "Reconciliation of Non-GAAP Financial
Measures" at end of release.
AMERISERV FINANCIAL,
INC.
|
NASDAQ:
ASRV
|
SUPPLEMENTAL
FINANCIAL PERFORMANCE DATA
|
December 31,
2020
|
(Dollars in
thousands, except per share and ratio data)
|
(Unaudited)
|
|
|
2020
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
TO DATE
|
PERFORMANCE DATA FOR
THE PERIOD:
|
|
|
|
|
|
Net income
|
$1,409
|
$1,419
|
$1,078
|
$692
|
$4,598
|
|
|
|
|
|
|
PERFORMANCE
PERCENTAGES (annualized):
|
|
|
|
|
|
Return on average
assets
|
0.48%
|
0.46%
|
0.34%
|
0.21%
|
0.37%
|
Return on average
equity
|
5.69
|
5.63
|
4.17
|
2.66
|
4.52
|
Return on average
tangible common equity (B)
|
6.46
|
6.38
|
4.72
|
3.01
|
5.12
|
Net interest
margin
|
3.21
|
3.30
|
2.97
|
3.12
|
3.19
|
Net charge-offs
(recoveries) as a percentage of average loans
|
0.06
|
0.04
|
0.04
|
0.01
|
0.03
|
Loan loss provision
(credit) as a percentage of average loans
|
0.08
|
0.20
|
0.29
|
0.44
|
0.26
|
Efficiency
ratio
|
84.46
|
83.09
|
84.79
|
85.28
|
84.41
|
|
|
|
|
|
|
EARNINGS PER COMMON
SHARE:
|
|
|
|
|
|
Basic
|
$0.08
|
$0.08
|
$0.06
|
$0.04
|
$0.27
|
Average number of
common shares outstanding
|
17,043
|
17,052
|
17,059
|
17,059
|
17,053
|
Diluted
|
0.08
|
0.08
|
0.06
|
0.04
|
0.27
|
Average number of
common shares outstanding
|
17,099
|
17,056
|
17,062
|
17,065
|
17,063
|
Cash dividends paid
per share
|
$0.025
|
$0.025
|
$0.025
|
$0.025
|
$0.100
|
|
|
|
2019
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
TO DATE
|
PERFORMANCE DATA FOR
THE PERIOD:
|
|
|
|
|
|
Net income
|
$1,878
|
$1,792
|
$1,689
|
$669
|
$6,028
|
|
|
|
|
|
|
PERFORMANCE
PERCENTAGES (annualized):
|
|
|
|
|
|
Return on average
assets
|
0.66%
|
0.61%
|
0.57%
|
0.23%
|
0.51%
|
Return on average
equity
|
7.84
|
7.24
|
6.60
|
2.59
|
6.02
|
Return on average
tangible common equity (B)
|
8.94
|
8.22
|
7.48
|
2.93
|
6.84
|
Net interest
margin
|
3.24
|
3.30
|
3.18
|
3.26
|
3.29
|
Net charge-offs
(recoveries) as a percentage of average loans
|
0.08
|
0.00
|
(0.01)
|
0.02
|
0.02
|
Loan loss provision
(credit) as a percentage of average loans
|
(0.19)
|
0.00
|
0.10
|
0.44
|
0.09
|
Efficiency
ratio
|
83.90
|
82.18
|
81.65
|
85.30
|
83.23
|
|
|
|
|
|
|
EARNINGS PER COMMON
SHARE:
|
|
|
|
|
|
Basic
|
$0.11
|
$0.10
|
$0.10
|
$0.04
|
$0.35
|
Average number of
common shares outstanding
|
17,578
|
17,476
|
17,278
|
17,111
|
17,359
|
Diluted
|
0.11
|
0.10
|
0.10
|
0.04
|
0.35
|
Average number of
common shares outstanding
|
17,664
|
17,560
|
17,360
|
17,193
|
17,440
|
Cash dividends paid
per share
|
$0.020
|
$0.025
|
$0.025
|
$0.025
|
$0.095
|
AMERISERV FINANCIAL,
INC.
|
NASDAQ:
ASRV
|
--CONTINUED--
|
(Dollars in
thousands, except per share, statistical, and ratio
data)
|
(Unaudited)
|
|
|
|
2020
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
FINANCIAL CONDITION
DATA AT PERIOD END:
|
|
|
|
|
Assets
|
$1,168,355
|
$1,242,074
|
$1,258,131
|
$1,279,713
|
Short-term
investments/overnight funds
|
6,431
|
30,219
|
23,222
|
11,077
|
Investment
securities
|
184,784
|
184,908
|
184,352
|
188,387
|
Total loans and loans
held for sale
|
877,399
|
928,350
|
949,367
|
978,345
|
Paycheck Protection
Program (PPP) loans
|
0
|
66,956
|
68,460
|
58,344
|
Allowance for loan
losses
|
9,334
|
9,699
|
10,284
|
11,345
|
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
Deposits
|
957,593
|
1,033,033
|
1,042,235
|
1,054,920
|
Short-term and FHLB
borrowings
|
74,572
|
69,894
|
80,230
|
89,691
|
Subordinated debt,
net
|
7,517
|
7,522
|
7,528
|
7,534
|
Shareholders'
equity
|
100,840
|
102,604
|
103,369
|
104,399
|
Non-performing
assets
|
2,244
|
3,122
|
2,603
|
3,331
|
Tangible common
equity ratio (B)
|
7.69%
|
7.37%
|
7.34%
|
7.29%
|
Total capital (to
risk weighted assets) ratio
|
13.41
|
13.18
|
13.02
|
12.93
|
PER COMMON
SHARE:
|
|
|
|
|
Book value
|
$5.92
|
$6.01
|
$6.06
|
$6.12
|
Tangible book value
(B)
|
5.22
|
5.31
|
5.36
|
5.42
|
Market value
(C)
|
2.62
|
3.08
|
2.81
|
3.13
|
Wealth management
assets – fair market value (A)
|
$1,983,952
|
$2,193,504
|
$2,289,948
|
$2,481,144
|
|
|
|
|
|
STATISTICAL DATA AT
PERIOD END:
|
|
|
|
|
Full-time equivalent
employees
|
306
|
305
|
306
|
299
|
Branch
locations
|
16
|
16
|
16
|
16
|
Common shares
outstanding
|
17,043,644
|
17,058,644
|
17,058,644
|
17,060,144
|
|
|
|
2019
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
FINANCIAL CONDITION
DATA AT PERIOD END:
|
|
|
|
|
Assets
|
$1,167,682
|
$1,190,583
|
$1,171,426
|
$1,171,184
|
Short-term
investments/overnight funds
|
7,996
|
6,532
|
6,039
|
6,526
|
Investment
securities
|
194,553
|
191,168
|
182,699
|
181,685
|
Total loans and loans
held for sale
|
863,134
|
890,081
|
875,082
|
887,574
|
Paycheck Protection
Program (PPP) loans
|
0
|
0
|
0
|
0
|
Allowance for loan
losses
|
8,107
|
8,102
|
8,345
|
9,279
|
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
Deposits
|
957,779
|
968,480
|
969,989
|
960,513
|
Short-term and FHLB
borrowings
|
79,483
|
88,314
|
66,905
|
76,080
|
Subordinated debt,
net
|
7,493
|
7,499
|
7,505
|
7,511
|
Shareholders'
equity
|
99,061
|
101,476
|
102,460
|
98,614
|
Non-performing
assets
|
1,168
|
1,681
|
1,957
|
2,339
|
Tangible common
equity ratio (B)
|
7.54%
|
7.60%
|
7.81%
|
7.48%
|
Total capital (to
risk weighted assets) ratio
|
13.37
|
13.14
|
13.33
|
13.49
|
PER COMMON
SHARE:
|
|
|
|
|
Book value
|
$5.65
|
$5.84
|
$5.98
|
$5.78
|
Tangible book value
(B)
|
4.97
|
5.15
|
5.28
|
5.08
|
Market value
(C)
|
4.02
|
4.15
|
4.14
|
4.20
|
Wealth management
assets – fair market value (A)
|
$2,229,860
|
$2,288,576
|
$2,142,513
|
$2,237,898
|
|
|
|
|
|
STATISTICAL DATA AT
PERIOD END:
|
|
|
|
|
Full-time equivalent
employees
|
309
|
309
|
308
|
309
|
Branch
locations
|
16
|
16
|
16
|
16
|
Common shares
outstanding
|
17,540,676
|
17,384,355
|
17,146,714
|
17,057,871
|
|
|
NOTES:
|
|
(A)
|
Not recognized on the
consolidated balance sheets.
|
(B)
|
Non-GAAP Financial
Information. See "Reconciliation of Non-GAAP Financial
Measures" at end of release.
|
(C)
|
Based on closing
price reported by the principal market on which the security is
traded last business day of the corresponding reporting
period.
|
AMERISERV FINANCIAL,
INC.
|
NASDAQ:
ASRV
|
CONSOLIDATED
STATEMENT OF INCOME
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
2020
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
TO DATE
|
INTEREST
INCOME
|
|
|
|
|
|
Interest and fees on
loans
|
$10,332
|
$10,448
|
$9,724
|
$10,124
|
$40,628
|
Interest on
investments
|
1,612
|
1,613
|
1,513
|
1,516
|
6,254
|
Total Interest
Income
|
11,944
|
12,061
|
11,237
|
11,640
|
46,882
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
Deposits
|
2,458
|
1,869
|
1,727
|
1,580
|
7,634
|
All
borrowings
|
735
|
719
|
719
|
708
|
2,881
|
Total Interest
Expense
|
3,193
|
2,588
|
2,446
|
2,288
|
10,515
|
|
|
|
|
|
|
NET INTEREST
INCOME
|
8,751
|
9,473
|
8,791
|
9,352
|
36,367
|
Provision (credit)
for loan losses
|
175
|
450
|
675
|
1,075
|
2,375
|
NET INTEREST INCOME
AFTER PROVISION (CREDIT) FOR LOAN
LOSSES
|
8,576
|
9,023
|
8,116
|
8,277
|
33,992
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
Wealth management
fees
|
2,554
|
2,471
|
2,604
|
2,583
|
10,212
|
Service charges on
deposit accounts
|
286
|
176
|
206
|
235
|
903
|
Net realized gains on
loans held for sale
|
237
|
335
|
507
|
444
|
1,523
|
Mortgage related
fees
|
126
|
145
|
161
|
127
|
559
|
Net realized gains on
investment securities
|
0
|
0
|
0
|
0
|
0
|
Impairment charge on
other investments
|
0
|
0
|
0
|
0
|
0
|
Bank owned life
insurance
|
125
|
152
|
161
|
344
|
782
|
Other
income
|
504
|
488
|
665
|
639
|
2,296
|
Total Non-Interest
Income
|
3,832
|
3,767
|
4,304
|
4,372
|
16,275
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
Salaries and employee
benefits
|
6,704
|
6,619
|
6,838
|
7,229
|
27,390
|
Net occupancy
expense
|
671
|
606
|
608
|
625
|
2,510
|
Equipment
expense
|
395
|
389
|
374
|
401
|
1,559
|
Professional
fees
|
1,154
|
1,331
|
1,373
|
1,361
|
5,219
|
FDIC deposit
insurance expense
|
26
|
130
|
140
|
185
|
481
|
Other
expenses
|
1,683
|
1,931
|
1,774
|
1,908
|
7,296
|
Total Non-Interest
Expense
|
10,633
|
11,006
|
11,107
|
11,709
|
44,455
|
|
|
|
|
|
|
PRETAX
INCOME
|
1,775
|
1,784
|
1,313
|
940
|
5,812
|
Income tax
expense
|
366
|
365
|
235
|
248
|
1,214
|
NET INCOME
|
$1,409
|
$1,419
|
$1,078
|
$692
|
$4,598
|
|
|
|
2019
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
TO DATE
|
INTEREST
INCOME
|
|
|
|
|
|
Interest and fees on
loans
|
$10,418
|
$10,994
|
$10,737
|
$10,784
|
$42,933
|
Interest on
investments
|
1,746
|
1,771
|
1,696
|
1,621
|
6,834
|
Total Interest
Income
|
12,164
|
12,765
|
12,433
|
12,405
|
49,767
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
Deposits
|
2,730
|
2,867
|
2,895
|
2,697
|
11,189
|
All
borrowings
|
777
|
837
|
774
|
748
|
3,136
|
Total Interest
Expense
|
3,507
|
3,704
|
3,669
|
3,445
|
14,325
|
|
|
|
|
|
|
NET INTEREST
INCOME
|
8,657
|
9,061
|
8,764
|
8,960
|
35,442
|
Provision (credit)
for loan losses
|
(400)
|
0
|
225
|
975
|
800
|
NET INTEREST INCOME
AFTER PROVISION (CREDIT) FOR LOAN
LOSSES
|
9,057
|
9,061
|
8,539
|
7,985
|
34,642
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
Wealth management
fees
|
2,396
|
2,419
|
2,431
|
2,484
|
9,730
|
Service charges on
deposit accounts
|
310
|
317
|
321
|
323
|
1,271
|
Net realized gains on
loans held for sale
|
62
|
107
|
405
|
291
|
865
|
Mortgage related
fees
|
44
|
77
|
97
|
84
|
302
|
Net realized gains on
investment securities
|
0
|
30
|
88
|
0
|
118
|
Impairment charge on
other investments
|
0
|
0
|
0
|
(500)
|
(500)
|
Bank owned life
insurance
|
128
|
129
|
131
|
133
|
521
|
Other
income
|
665
|
578
|
622
|
601
|
2,466
|
Total Non-Interest
Income
|
3,605
|
3,657
|
4,095
|
3,416
|
14,773
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
Salaries and employee
benefits
|
6,301
|
6,348
|
6,324
|
6,456
|
25,429
|
Net occupancy
expense
|
658
|
622
|
599
|
618
|
2,497
|
Equipment
expense
|
361
|
387
|
333
|
429
|
1,510
|
Professional
fees
|
1,120
|
1,249
|
1,276
|
1,240
|
4,885
|
FDIC deposit
insurance expense
|
80
|
80
|
0
|
(60)
|
100
|
Other
expenses
|
1,773
|
1,770
|
1,971
|
1,880
|
7,394
|
Total Non-Interest
Expense
|
10,293
|
10,456
|
10,503
|
10,563
|
41,815
|
|
|
|
|
|
|
PRETAX
INCOME
|
2,369
|
2,262
|
2,131
|
838
|
7,600
|
Income tax
expense
|
491
|
470
|
442
|
169
|
1,572
|
NET INCOME
|
$1,878
|
$1,792
|
$1,689
|
$669
|
$6,028
|
AMERISERV FINANCIAL,
INC.
|
NASDAQ:
ASRV
|
Average Balance Sheet
Data
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
2020
|
2019
|
|
|
TWELVE
|
|
TWELVE
|
|
4QTR
|
MONTHS
|
4QTR
|
MONTHS
|
Interest earning
assets:
|
|
|
|
|
Loans and loans held
for sale, net of unearned income
|
$970,298
|
$923,269
|
$876,988
|
$875,198
|
Short-term
investments
|
20,783
|
28,831
|
17,471
|
10,552
|
Deposits with
banks
|
2,563
|
3,137
|
1,015
|
1,018
|
Total investment
securities
|
190,296
|
187,782
|
185,652
|
194,011
|
Total interest
earning assets
|
1,183,940
|
1,143,019
|
1,081,126
|
1,080,779
|
|
|
|
|
|
Non-interest earning
assets:
|
|
|
|
|
Cash and due from
banks
|
17,177
|
18,091
|
19,888
|
20,239
|
Premises and
equipment
|
18,265
|
18,439
|
18,725
|
17,928
|
Other
assets
|
72,326
|
70,867
|
65,451
|
64,083
|
Allowance for loan
losses
|
(10,445)
|
(9,732)
|
(8,518)
|
(8,404)
|
|
|
|
|
|
Total
assets
|
$1,281,263
|
$1,240,684
|
$1,176,672
|
$1,174,625
|
|
|
|
|
|
Interest bearing
liabilities:
|
|
|
|
|
Interest bearing
deposits:
|
|
|
|
|
Interest bearing
demand
|
$183,256
|
$175,088
|
$173,933
|
$170,326
|
Savings
|
110,274
|
104,442
|
94,117
|
96,783
|
Money market
|
229,987
|
234,771
|
229,740
|
234,387
|
Other time
|
357,367
|
345,228
|
338,117
|
326,867
|
Total interest
bearing deposits
|
880,884
|
859,529
|
835,907
|
828,363
|
Borrowings:
|
|
|
|
|
Federal funds purchased
and other short-term borrowings
|
11,204
|
4,947
|
2,521
|
11,088
|
Advances from Federal
Home Loan Bank
|
67,251
|
64,046
|
55,901
|
52,309
|
Guaranteed junior
subordinated deferrable interest debentures
|
13,085
|
13,085
|
13,085
|
13,085
|
Subordinated
debt
|
7,650
|
7,650
|
7,650
|
7,650
|
Lease
liabilities
|
3,916
|
3,949
|
4,059
|
3,444
|
Total interest
bearing liabilities
|
983,990
|
953,206
|
919,123
|
915,939
|
|
|
|
|
|
Non-interest bearing
liabilities:
|
|
|
|
|
Demand
deposits
|
186,043
|
175,336
|
148,576
|
151,292
|
Other
liabilities
|
7,783
|
10,340
|
6,582
|
7,271
|
Shareholders'
equity
|
103,447
|
101,802
|
102,391
|
100,123
|
Total liabilities and
shareholders' equity
|
$1,281,263
|
$1,240,684
|
$1,176,672
|
$1,174,625
|
AMERISERV FINANCIAL,
INC.
|
NASDAQ:
ASRV
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES
|
RETURN ON AVERAGE
TANGIBLE COMMON EQUITY, TANGIBLE COMMON EQUITY RATIO, TANGIBLE BOOK
VALUE PER SHARE, AND LOAN LOSS RESERVE COVERAGE TO TOTAL LOANS
EXCLUDING PPP LOANS
|
(Dollars in
thousands, except per share and ratio data)
|
(Unaudited)
|
|
The press release
contains certain financial information determined by methods other
than in accordance with generally accepted accounting policies in
the United States (GAAP). These non-GAAP financial measures
are "return on average tangible common equity", "tangible common
equity ratio", "tangible book value per share", and "loan loss
reserve coverage to total loans excluding PPP loans." This
non-GAAP disclosure has limitations as an analytical tool and
should not be considered in isolation or as a substitute for
analysis of the Company's results as reported under GAAP, nor is it
necessarily comparable to non-GAAP performance measures that may be
presented by other companies. Our management uses these
non-GAAP measures in its analysis of our performance because it
believes these measures are material and will be used as a measure
of our performance by investors.
|
|
|
2020
|
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
TO DATE
|
Return on Average
Tangible Common Equity
|
|
|
|
|
|
Net income
|
$1,409
|
$1,419
|
$1,078
|
$692
|
$4,598
|
|
|
|
|
|
|
Average shareholders'
equity
|
99,612
|
101,336
|
102,813
|
103,447
|
101,802
|
Less:
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
11,944
|
Average tangible
common equity
|
87,668
|
89,392
|
90,869
|
91,503
|
89,858
|
|
|
|
|
|
|
Return on average
tangible common equity (annualized)
|
6.46%
|
6.38%
|
4.72%
|
3.01%
|
5.12%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
|
TANGIBLE COMMON
EQUITY
|
|
|
|
|
|
Total shareholders'
equity
|
$100,840
|
$102,604
|
$103,369
|
$104,399
|
|
Less:
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
|
Tangible common
equity
|
88,896
|
90,660
|
91,425
|
92,455
|
|
|
|
|
|
|
|
TANGIBLE
ASSETS
|
|
|
|
|
|
Total
assets
|
1,168,355
|
1,242,074
|
1,258,131
|
1,279,713
|
|
Less:
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
|
Tangible
assets
|
1,156,411
|
1,230,130
|
1,246,187
|
1,267,769
|
|
|
|
|
|
|
|
Tangible common
equity ratio
|
7.69%
|
7.37%
|
7.34%
|
7.29%
|
|
|
|
|
|
|
|
Total shares
outstanding
|
17,043,644
|
17,058,644
|
17,058,644
|
17,060,144
|
|
|
|
|
|
|
|
Tangible book value
per share
|
$5.22
|
$5.31
|
$5.36
|
$5.42
|
|
|
|
|
|
2019
|
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
TO DATE
|
Return on Average
Tangible Common Equity
|
|
|
|
|
|
Net income
|
$1,878
|
$1,792
|
$1,689
|
$669
|
$6,028
|
|
|
|
|
|
|
Average shareholders'
equity
|
97,166
|
99,371
|
101,566
|
102,391
|
100,123
|
Less:
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
11,944
|
Average tangible
common equity
|
85,222
|
87,427
|
89,622
|
90,447
|
88,179
|
|
|
|
|
|
|
Return on average
tangible common equity (annualized)
|
8.94%
|
8.22%
|
7.48%
|
2.93%
|
6.84%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
|
TANGIBLE COMMON
EQUITY
|
|
|
|
|
|
Total shareholders'
equity
|
$99,061
|
$101,476
|
$102,460
|
$98,614
|
|
Less:
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
|
Tangible common
equity
|
87,117
|
89,532
|
90,516
|
86,670
|
|
|
|
|
|
|
|
TANGIBLE
ASSETS
|
|
|
|
|
|
Total
assets
|
1,167,682
|
1,190,583
|
1,171,426
|
1,171,184
|
|
Less:
Goodwill
|
11,944
|
11,944
|
11,944
|
11,944
|
|
Tangible
assets
|
1,155,738
|
1,178,639
|
1,159,482
|
1,159,240
|
|
|
|
|
|
|
|
Tangible common
equity ratio
|
7.54%
|
7.60%
|
7.81%
|
7.48%
|
|
|
|
|
|
|
|
Total shares
outstanding
|
17,540,676
|
17,384,355
|
17,146,714
|
17,057,871
|
|
|
|
|
|
|
|
Tangible book value
per share
|
$4.97
|
$5.15
|
$5.28
|
$5.08
|
|
AMERISERV FINANCIAL,
INC.
|
NASDAQ:
ASRV
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES
|
RETURN ON AVERAGE
TANGIBLE COMMON EQUITY, TANGIBLE COMMON EQUITY RATIO, TANGIBLE BOOK
VALUE PER SHARE, AND LOAN LOSS RESERVE COVERAGE TO TOTAL LOANS
EXCLUDING PPP LOANS
|
--CONTINUED--
|
(Dollars in
thousands, except per share and ratio data)
|
(Unaudited)
|
|
The press release
contains certain financial information determined by methods other
than in accordance with generally accepted accounting policies in
the United States (GAAP). These non-GAAP financial measures
are "return on average tangible common equity", "tangible common
equity ratio", "tangible book value per share", and "loan loss
reserve coverage to total loans excluding PPP loans." This
non-GAAP disclosure has limitations as an analytical tool and
should not be considered in isolation or as a substitute for
analysis of the Company's results as reported under GAAP, nor is it
necessarily comparable to non-GAAP performance measures that may be
presented by other companies. Our management uses these
non-GAAP measures in its analysis of our performance because it
believes these measures are material and will be used as a measure
of our performance by investors.
|
|
|
December 31,
2020
|
ALLOWANCE RESERVE
COVERAGE
|
|
Allowance for loan
losses
|
$11,345
|
|
|
Total loans and loans
held for sale, net of unearned income
|
978,345
|
|
|
Reserve
coverage
|
1.16%
|
|
|
Reserve coverage
to total loans, excluding PPP loans:
|
|
Allowance for loan
losses
|
$11,345
|
|
|
Total loans and loans
held for sale, net of unearned income
|
978,345
|
PPP loans
|
(58,344)
|
|
920,001
|
|
|
Non-GAAP reserve
coverage
|
1.23%
|
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SOURCE AmeriServ Financial, Inc.