Eagle Bancorp Montana, Inc. (NASDAQ: EBMT), (the “Company,”
“Eagle”), the holding company of Opportunity Bank of Montana (the
“Bank”), today reported net income of $1.7 million, or $0.22
per diluted share, in the second quarter of 2024, compared to $1.9
million, or $0.24 per diluted share, in the preceding quarter, and
$2.0 million, or $0.26 per diluted share, in the second quarter of
2023. In the first six months of 2024, net income was $3.6 million,
or $0.46 per diluted share, compared to $5.3 million, or $0.67 per
diluted share, in the first six months of 2023.
Eagle’s board of directors increased its
quarterly cash dividend to $0.1425 per share on July 22, 2024. The
dividend will be payable September 6, 2024, to shareholders of
record August 16, 2024. The current dividend represents an
annualized yield of 4.27% based on recent market prices.
“We produced solid second quarter results,
fueled by disciplined loan growth, pristine credit quality metrics
and net interest margin expansion, compared to the previous
quarter,” said Laura F. Clark, President and CEO. “We continue to
attract high quality loans, achieving loan growth of 6.8%
year-over-year, even in the current rate environment. Additionally,
the increase in loan yields more than offset the increase in
funding costs, contributing to net interest margin expansion for
the second consecutive quarter. We are one of three publicly traded
financial institutions based in Montana, and with our strong
deposit franchise and healthy capital levels we are well positioned
to continue to grow in our markets.”
Second Quarter 2024 Highlights
(at or for the three-month period ended June 30, 2024, except where
noted):
- Net income was $1.7 million, or
$0.22 per diluted share, in the second quarter of 2024, compared to
$1.9 million, or $0.24 per diluted share, in the preceding quarter,
and $2.0 million, or $0.26 per diluted share, in the second quarter
a year ago.
- Net interest margin (“NIM”) was
3.41% in the second quarter of 2024, an eight basis point
improvement compared to 3.33% in the preceding quarter, and a six
basis point contraction compared to 3.47% in the second quarter a
year ago.
- Revenues (net interest income before the provision for credit
losses, plus noninterest income) were $19.9 million in the second
quarter of 2024, compared to $19.2 million in the preceding quarter
and $21.5 million in the second quarter a year ago.
- The accretion of the loan purchase
discount into loan interest income from acquisitions was $304,000
in the second quarter of 2024, compared to accretion on purchased
loans from acquisitions of $118,000 in the preceding quarter.
- Total loans increased 6.8% to $1.52
billion, at June 30, 2024, compared to $1.42 billion a year
earlier, and increased 1.3% compared to $1.50 billion at March 31,
2024.
- Total deposits increased 2.6% to $1.62 billion at June 30,
2024, compared to $1.58 billion a year earlier, and decreased 1.0%
compared to $1.64 billion at March 31, 2024.
- The allowance for credit losses represented 1.11% of portfolio
loans and 330.8% of nonperforming loans at June 30, 2024, compared
to 1.09% of portfolio loans and 156.7% of nonperforming loans at
June 30, 2023.
- The Company’s available borrowing capacity was approximately
$374.5 million at June 30, 2024.
|
|
|
|
June 30, 2024 |
|
(Dollars in thousands) |
|
|
Borrowings Outstanding |
Remaining Borrowing Capacity |
|
Federal Home Loan Bank advances |
$ |
195,050 |
$ |
245,326 |
|
Federal Reserve Bank discount window |
|
- |
|
29,222 |
|
Federal
Reserve Bank Term Funding Program |
|
|
|
|
20,000 |
|
- |
|
Correspondent bank lines of credit |
|
- |
|
100,000 |
|
Total |
|
|
|
$ |
215,050 |
$ |
374,548 |
|
|
|
|
|
|
|
|
- The Company paid a quarterly cash dividend in the second
quarter of $0.14 per share on June 7, 2024, to shareholders of
record May 17, 2024.
Balance Sheet Results
Eagle’s total assets increased 3.7% to $2.10
billion at June 30, 2024, compared to $2.02 billion a year ago, and
increased 1.1% compared to $2.08 billion three months earlier. The
investment securities portfolio totaled $306.9 million at June
30, 2024, compared to $326.0 million a year ago, and $311.2
million at March 31, 2024.
Eagle originated $60.6 million in new
residential mortgages during the quarter and sold $53.2 million in
residential mortgages, with an average gross margin on sale of
mortgage loans of approximately 3.01%. This production compares to
residential mortgage originations of $50.4 million in the preceding
quarter with sales of $43.6 million and an average gross margin on
sale of mortgage loans of approximately 3.25%. Mortgage volumes
remain low as rates have continued to be elevated relative to rates
on existing mortgages.
Total loans increased $96.0 million, or 6.8%,
compared to a year ago, and $20.4 million, or 1.3%, from three
months earlier. Commercial real estate loans increased 8.6% to
$627.3 million at June 30, 2024, compared to $577.7 million a year
earlier. Commercial real estate loans were comprised of 67.1%
non-owner occupied and 32.9% owner occupied at June 30, 2024.
Agricultural and farmland loans increased 6.4% to $279.5 million at
June 30, 2024, compared to $262.8 million a year earlier, as
the Company continues to build expertise in agricultural lending.
Residential mortgage loans increased 17.7% to $157.1 million,
compared to $133.4 million a year earlier. Commercial loans
increased 11.3% to $143.6 million, compared to $129.1 million a
year ago. Commercial construction and development loans decreased
13.3% to $137.4 million, compared to $158.5 million a year
ago. Home equity loans increased 16.0% to $93.2 million,
residential construction loans increased 1.4% to
$50.2 million, and consumer loans decreased 3.1% to $29.1
million, compared to a year ago.
“Our deposit mix continues to shift towards
higher yielding deposits due to the higher interest rate
environment. However, the increase in our overall cost of deposits
has slowed, and we anticipate deposit rates will continue to
stabilize over the next several quarters,” said Miranda Spaulding,
CFO.
Total deposits increased 2.6% to $1.62 billion
at June 30, 2024, compared to $1.58 billion at June 30, 2023, and
decreased 1.0% compared to $1.64 billion at March 31, 2024.
Noninterest-bearing checking accounts represented 24.7%,
interest-bearing checking accounts represented 13.0%, savings
accounts represented 13.6%, money market accounts comprised 22.2%
and time certificates of deposit made up 26.5% of the total deposit
portfolio at June 30, 2024. Time certificates of deposit include
$26.2 million in brokered certificates at June 30, 2024, compared
to $15.1 million at June 30, 2023, and $50.0 million at March 31,
2024. The average cost of total deposits was 1.70% in the second
quarter of 2024, compared to 1.62% in the preceding quarter and
1.05% in the second quarter of 2023. The estimated amount of
uninsured deposits at both June 30, 2024 and March 31, 2024, was
approximately $284.0 million, or 17% of total deposits.
Shareholders’ equity was $170.2 million at June
30, 2024, compared to $162.7 million a year earlier and
$168.9 million three months earlier. Book value per share was
$21.23 at June 30, 2024, compared to $20.37 a year earlier and
$21.07 three months earlier. Tangible book value per share, a
non-GAAP financial measure calculated by dividing shareholders’
equity, less goodwill and core deposit intangible, by common shares
outstanding, was $16.25 at June 30, 2024, compared to $15.19 a year
earlier and $16.05 three months earlier.
Operating Results
“Our NIM expanded eight basis points during the
second quarter compared to the preceding quarter, boosted by growth
and higher yields on interest earning assets in addition to a
slowdown in cost of funds expansion,” said Clark. “We anticipate
continued improvement in our cost of funds as we continue through
this rate cycle.”
Eagle’s NIM was 3.41% in the second quarter of
2024, compared to 3.33% in the preceding quarter, and a six
basis-point contraction compared to 3.47% in the second quarter a
year ago. The interest accretion on acquired loans totaled $304,000
and resulted in a seven basis-point increase in the NIM during the
second quarter of 2024, compared to $118,000 and a three
basis-point increase in the NIM during the preceding quarter.
Funding costs for the second quarter of 2024 were 2.78%, compared
to 2.67% in the first quarter of 2024 and 2.06% in the second
quarter of 2023. Average yields on interest earning assets for the
second quarter of 2024 increased to 5.64%, compared to 5.47% in the
first quarter of 2024 and 5.06% in the second quarter a year ago.
For the first six months of 2024, the NIM was 3.37% compared to
3.66% for the first six months of 2023.
Net interest income, before the provision for
credit losses, increased 2.7% to $15.6 million in the second
quarter of 2024, compared to $15.2 million in the first quarter of
2024, and increased 2.4% compared to $15.3 million in the second
quarter of 2023. Year-to-date, net interest income decreased 2.7%
to $30.8 million, compared to $31.7 million in the same period one
year earlier.
Revenues for the second quarter of 2024
increased 3.8% to $19.9 million, compared to $19.2 million in the
preceding quarter and decreased 7.3% compared to $21.5 million in
the second quarter a year ago. In the first six months of 2024,
revenues were $39.1 million, compared to $42.6 million in the first
six months of 2023. The decrease compared to the first six months a
year ago was largely due to lower volumes in mortgage banking
activity.
Total noninterest income increased 8.0% to $4.3
million in the second quarter of 2024, compared to $4.0 million in
the preceding quarter, and decreased 31.2% compared to $6.2 million
in the second quarter a year ago. Net mortgage banking income, the
largest component of noninterest income, totaled $2.4 million in
the second quarter of 2024, compared to $2.2 million in the
preceding quarter and $3.9 million in the second quarter a year
ago. This decrease compared to the second quarter a year ago was
largely driven by a decline in net gain on sale of mortgage loans.
This was impacted by mortgage margin compression and lower loan
volumes. In the first six months of 2024, noninterest income
decreased 24.4% to $8.2 million, compared to $10.9 million in the
first six months of 2023. Net mortgage banking income decreased
33.6% to $4.6 million in the first six months of 2024, compared to
$6.9 million in the first six months of 2023. These decreases were
driven by a decline in net gain on sale of mortgage loans.
Eagle’s second quarter noninterest expense
increased 1.6% to $17.3 million, compared to $17.0 million in the
preceding quarter and decreased 7.9% compared to $18.8 million in
the second quarter a year ago. Lower salaries and employee benefits
contributed to the decrease compared to the year ago quarter. In
the first six months of 2024, noninterest expense decreased 2.8% to
$34.3 million, compared to $35.3 million in the first six months of
2023.
For the second quarter of 2024, the Company
recorded an income tax expense of $444,000. This compared to an
income tax expense of $370,000 in the preceding quarter and income
tax expense of $344,000 in the second quarter of 2023. The
effective tax rate for the second quarter of 2024 was 20.3%,
compared to 14.6% for the second quarter of 2023. The year-to-date
effective tax rate was 18.3% for 2024 compared to 20.9% for the
same period in 2023.
Credit Quality
During the second quarter of 2024, Eagle
recorded a provision for credit losses of $412,000. This compared
to a $135,000 recapture to its provision for credit losses in the
preceding quarter and a $319,000 provision for credit losses in the
second quarter a year ago. The allowance for credit losses
represented 330.8% of nonperforming loans at June 30, 2024,
compared to 227.6% three months earlier and 156.7% a year earlier.
Nonperforming loans were $5.1 million at June 30, 2024, $7.2
million at March 31, 2024, and $9.9 million a year
earlier.
Net loan charge-offs totaled $2,000 in the
second quarter of 2024, compared to net loan recoveries of $65,000
in the preceding quarter and net loan recoveries of $151,000 in the
second quarter a year ago. The allowance for credit losses was
$16.8 million, or 1.11% of total loans, at June 30, 2024, compared
to $16.4 million, or 1.10% of total loans, at March 31, 2024, and
$15.6 million, or 1.09% of total loans, a year ago.
Capital Management
The ratio of tangible common shareholders’
equity (shareholders’ equity, less goodwill and core deposit
intangible) to tangible assets (total assets, less goodwill and
core deposit intangible) was 6.33% at June 30, 2024, from 6.12% a
year ago and 6.32% three months earlier. As of June 30, 2024, the
Bank’s regulatory capital was in excess of all applicable
regulatory requirements and is deemed well capitalized. The Bank’s
Tier 1 capital to adjusted total average assets was 9.92% as of
June 30, 2024.
About the Company
Eagle Bancorp Montana, Inc. is a bank holding
company headquartered in Helena, Montana, and is the holding
company of Opportunity Bank of Montana, a community bank
established in 1922 that serves consumers and small businesses in
Montana through 29 banking offices. Additional information is
available on the Bank’s website at www.opportunitybank.com. The
shares of Eagle Bancorp Montana, Inc. are traded on the NASDAQ
Global Market under the symbol “EBMT.”
Forward Looking Statements
This release may contain certain
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, and may be identified by the use of such
words as "believe," “will” "expect," "anticipate," "should,"
"planned," "estimated," and "potential." These forward-looking
statements include, but are not limited to statements of our goals,
intentions and expectations; statements regarding our business
plans, prospects, mergers, growth and operating strategies;
statements regarding the asset quality of our loan and investment
portfolios; and estimates of our risks and future costs and
benefits. These forward-looking statements are based on current
beliefs and expectations of our management and are inherently
subject to significant business, economic and competitive
uncertainties and contingencies, many of which are beyond our
control. In addition, these forward-looking statements are subject
to assumptions with respect to future business strategies and
decisions that are subject to change. These factors include, but
are not limited to, changes in laws or government regulations or
policies affecting financial institutions, including changes in
regulatory fees and capital requirements; general economic
conditions and political events, either nationally or in our market
areas, that are worse than expected including the ability of the
U.S. Congress to increase the U.S. statutory debt limit, as needed,
as well as the impact of the 2024 U.S. presidential election; the
emergence or continuation of widespread health emergencies or
pandemics including the magnitude and duration of the COVID-19
pandemic, including but not limited to vaccine efficacy and
immunization rates, new variants, steps taken by governmental and
other authorities to contain, mitigate and combat the pandemic,
adverse effects on our employees, customers and third-party service
providers, the increase in cyberattacks in the current
work-from-home environment, the ultimate extent of the impacts on
our business, financial position, results of operations, liquidity
and prospects, continued deterioration in general business and
economic conditions could adversely affect our revenues and the
values of our assets and liabilities, lead to a tightening of
credit and increase stock price volatility, and potential
impairment charges; the impact of continuing adverse developments
affecting the U.S. banking industry, including the associated
impact of any regulatory changes or other mitigation efforts taken
by governmental agencies in response thereto; the possibility that
future credit losses may be higher than currently expected due to
changes in economic assumptions, customer behavior, adverse
developments with respect to U.S. economic conditions and other
uncertainties, including the impact of supply chain disruptions,
inflationary pressures and labor shortages on economic conditions
and our business; an inability to access capital markets or
maintain deposits or borrowing costs; competition among banks,
financial holding companies and other traditional and
non-traditional financial service providers; loan demand or
residential and commercial real estate values in Montana; the
concentration of our business in Montana; our ability to continue
to increase and manage our commercial real estate, commercial
business and agricultural loans; the costs and effects of legal,
compliance and regulatory actions, changes and developments,
including the initiation and resolution of legal proceedings
(including any securities, bank operations, consumer or employee
litigation); inflation and changes in the interest rate environment
that reduce our margins or reduce the fair value of financial
instruments; adverse changes in the securities markets that lead to
impairment in the value of our investment securities and goodwill;
other economic, governmental, competitive, regulatory and
technological factors that may affect our operations; our ability
to implement new technologies and maintain secure and reliable
technology systems including those that involve the Bank’s
third-party vendors and service providers; cyber incidents, or
theft or loss of Company or customer data or money; our ability to
appropriately address social, environmental, and sustainability
concerns that may arise from our business activities; the effect of
our recent or future acquisitions, including the failure to achieve
expected revenue growth and/or expense savings, the failure to
effectively integrate their operations, the outcome of any legal
proceedings and the diversion of management time on issues related
to the integration.
Because of these and other uncertainties, our
actual future results may be materially different from the results
indicated by these forward-looking statements. All information set
forth in this press release is current as of the date of this
release and the company undertakes no duty or obligation to update
this information.
Use of Non-GAAP Financial
Measures
In addition to results presented in accordance
with generally accepted accounting principles utilized in the
United States, or GAAP, the Financial Ratios and Other Data
contains non-GAAP financial measures. Non-GAAP financial measures
include: 1) core efficiency ratio, 2) tangible book value per share
and 3) tangible common equity to tangible assets. The Company uses
these non-GAAP financial measures to provide meaningful
supplemental information regarding the Company’s operational
performance and performance trends, and to enhance investors’
overall understanding of such financial performance. In particular,
the use of tangible book value per share and tangible common equity
to tangible assets is prevalent among banking regulators, investors
and analysts.
The numerator for the core efficiency ratio is
calculated by subtracting acquisition costs and intangible asset
amortization from noninterest expense. Tangible assets and tangible
common shareholders’ equity are calculated by excluding intangible
assets from assets and shareholders’ equity, respectively. For
these financial measures, our intangible assets consist of goodwill
and core deposit intangible. Tangible book value per share is
calculated by dividing tangible common shareholders’ equity by the
number of common shares outstanding. We believe that this measure
is consistent with the capital treatment by our bank regulatory
agencies, which exclude intangible assets from the calculation of
risk-based capital ratios and present this measure to facilitate
the comparison of the quality and composition of our capital over
time and in comparison, to our competitors.
Non-GAAP financial measures have inherent
limitations, are not required to be uniformly applied, and are not
audited. Because non-GAAP financial measures are not standardized,
it may not be possible to compare these financial measures with
other companies’ non-GAAP financial measures having the same or
similar names. Further, the non-GAAP financial measure of tangible
book value per share should not be considered in isolation or as a
substitute for book value per share or total shareholders’ equity
determined in accordance with GAAP, and may not be comparable to a
similarly titled measure reported by other companies.
Reconciliation of the GAAP and non-GAAP financial measures are
presented below.
Balance Sheet |
|
|
|
|
|
|
|
|
(Dollars in thousands, except per share data) |
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
June 30, |
March 31, |
June 30, |
|
|
|
|
|
|
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
|
|
$ |
22,361 |
|
$ |
19,479 |
|
$ |
21,878 |
|
|
|
Interest bearing deposits in banks |
|
|
|
1,401 |
|
|
1,438 |
|
|
1,116 |
|
|
|
|
Total cash and cash equivalents |
|
|
23,762 |
|
|
20,917 |
|
|
22,994 |
|
|
|
Securities available-for-sale, at fair value |
|
|
|
306,869 |
|
|
311,227 |
|
|
325,964 |
|
|
|
Federal Home Loan Bank ("FHLB") stock |
|
|
|
10,136 |
|
|
8,449 |
|
|
10,099 |
|
|
|
Federal Reserve Bank ("FRB") stock |
|
|
|
4,131 |
|
|
4,131 |
|
|
4,131 |
|
|
|
Mortgage loans held-for-sale, at fair value |
|
|
|
10,518 |
|
|
9,612 |
|
|
22,381 |
|
|
|
Loans: |
|
|
|
|
|
|
|
|
|
Real estate loans: |
|
|
|
|
|
|
|
|
Residential 1-4 family |
|
|
|
|
157,053 |
|
|
157,414 |
|
|
133,437 |
|
|
|
Residential 1-4 family
construction |
|
|
|
50,228 |
|
|
45,026 |
|
|
49,516 |
|
|
|
Commercial real estate |
|
|
|
|
627,326 |
|
|
632,452 |
|
|
577,736 |
|
|
|
Commercial construction and
development |
|
|
137,427 |
|
|
147,740 |
|
|
158,519 |
|
|
|
Farmland |
|
|
|
|
|
142,353 |
|
|
140,246 |
|
|
139,290 |
|
|
|
Other loans: |
|
|
|
|
|
|
|
|
|
Home equity |
|
|
|
|
|
93,213 |
|
|
90,418 |
|
|
80,333 |
|
|
|
Consumer |
|
|
|
|
|
29,118 |
|
|
29,677 |
|
|
30,065 |
|
|
|
Commercial |
|
|
|
|
|
143,641 |
|
|
137,640 |
|
|
129,084 |
|
|
|
Agricultural |
|
|
|
|
|
137,134 |
|
|
116,775 |
|
|
123,503 |
|
|
|
|
Total
loans |
|
|
|
|
1,517,493 |
|
|
1,497,388 |
|
|
1,421,483 |
|
|
|
Allowance for credit losses |
|
|
|
|
(16,830 |
) |
|
(16,410 |
) |
|
(15,560 |
) |
|
|
|
Net
loans |
|
|
|
|
1,500,663 |
|
|
1,480,978 |
|
|
1,405,923 |
|
|
|
Accrued interest and dividends receivable |
|
|
|
13,195 |
|
|
12,038 |
|
|
11,194 |
|
|
|
Mortgage servicing rights, net |
|
|
|
|
15,614 |
|
|
15,738 |
|
|
15,501 |
|
|
|
Assets held for sale, at cost |
|
|
|
|
257 |
|
|
- |
|
|
323 |
|
|
|
Premises and equipment, net |
|
|
|
|
98,397 |
|
|
97,643 |
|
|
88,760 |
|
|
|
Cash surrender value of life insurance, net |
|
|
|
48,529 |
|
|
48,218 |
|
|
47,520 |
|
|
|
Goodwill |
|
|
|
|
|
34,740 |
|
|
34,740 |
|
|
34,740 |
|
|
|
Core deposit intangible, net |
|
|
|
|
5,168 |
|
|
5,514 |
|
|
6,648 |
|
|
|
Other
assets |
|
|
|
|
|
26,976 |
|
|
26,869 |
|
|
27,101 |
|
|
|
|
Total
assets |
|
|
|
$ |
2,098,955 |
|
$ |
2,076,074 |
|
$ |
2,023,279 |
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
|
|
|
Deposit
accounts: |
|
|
|
|
|
|
|
|
|
Noninterest bearing |
|
|
|
$ |
400,113 |
|
$ |
408,781 |
|
$ |
432,463 |
|
|
|
Interest bearing |
|
|
|
|
|
1,218,752 |
|
|
1,226,818 |
|
|
1,145,904 |
|
|
|
|
Total deposits |
|
|
|
1,618,865 |
|
|
1,635,599 |
|
|
1,578,367 |
|
|
|
Accrued expenses and other liabilities |
|
|
|
35,804 |
|
|
34,950 |
|
|
32,002 |
|
|
|
FHLB advances and other borrowings |
|
|
|
215,050 |
|
|
177,540 |
|
|
191,260 |
|
|
|
Other long-term debt, net |
|
|
|
|
59,074 |
|
|
59,037 |
|
|
58,925 |
|
|
|
|
Total liabilities |
|
|
|
1,928,793 |
|
|
1,907,126 |
|
|
1,860,554 |
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' Equity: |
|
|
|
|
|
|
|
|
|
Preferred stock (par value $0.01 per share; 1,000,000 shares |
|
|
|
|
|
authorized; no shares issued or outstanding) |
|
|
- |
|
|
- |
|
|
- |
|
|
|
Common stock (par value $0.01; 20,000,000 shares authorized; |
|
|
|
|
|
8,507,429 shares issued; 8,016,784, 8,016,784 and 7,988,132 |
|
|
|
|
|
shares outstanding at June 30, 2024, March 31, 2024 and |
|
|
|
|
|
June 30, 2023, respectively |
|
|
|
|
85 |
|
|
85 |
|
|
85 |
|
|
|
Additional paid-in capital |
|
|
|
|
108,962 |
|
|
108,893 |
|
|
109,345 |
|
|
|
Unallocated common stock held by Employee Stock Ownership Plan |
|
(4,297 |
) |
|
(4,440 |
) |
|
(4,870 |
) |
|
|
Treasury stock, at cost (490,645, 490,645 and 519,297 shares
at |
|
|
|
|
|
June 30, 2024, March 31, 2024 and June 30, 2023, respectively) |
|
(11,124 |
) |
|
(11,124 |
) |
|
(11,574 |
) |
|
|
Retained
earnings |
|
|
|
|
|
97,413 |
|
|
96,797 |
|
|
93,462 |
|
|
|
Accumulated other comprehensive loss, net of tax |
|
|
(20,877 |
) |
|
(21,263 |
) |
|
(23,723 |
) |
|
|
|
Total shareholders' equity |
|
|
170,162 |
|
|
168,948 |
|
|
162,725 |
|
|
|
|
Total liabilities and shareholders' equity |
$ |
2,098,955 |
|
$ |
2,076,074 |
|
$ |
2,023,279 |
|
|
|
|
|
|
|
|
|
|
|
|
Income Statement |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
(Dollars in thousands, except per share data) |
|
|
Three Months Ended |
|
Six Months
Ended |
|
|
|
|
|
|
|
June 30, |
March 31, |
June 30, |
|
June 30, |
|
|
|
|
|
|
|
|
2024 |
|
2024 |
|
|
2023 |
|
|
2024 |
|
2023 |
|
Interest and dividend income: |
|
|
|
|
|
|
|
|
|
Interest and fees on loans |
|
|
$ |
22,782 |
$ |
21,942 |
|
$ |
19,137 |
|
$ |
44,724 |
$ |
36,874 |
|
|
Securities available-for-sale |
|
|
|
2,631 |
|
2,724 |
|
|
2,949 |
|
|
5,355 |
|
5,792 |
|
|
FRB and FHLB dividends |
|
|
|
264 |
|
247 |
|
|
161 |
|
|
511 |
|
268 |
|
|
Other interest income |
|
|
|
145 |
|
29 |
|
|
25 |
|
|
174 |
|
46 |
|
|
|
Total interest and dividend income |
|
|
|
25,822 |
|
24,942 |
|
|
22,272 |
|
|
50,764 |
|
42,980 |
|
Interest expense: |
|
|
|
|
|
|
|
|
|
|
Interest expense on deposits |
|
|
|
6,884 |
|
6,548 |
|
|
4,155 |
|
|
13,432 |
|
6,615 |
|
|
FHLB advances and other borrowings |
|
|
|
2,625 |
|
2,497 |
|
|
2,179 |
|
|
5,122 |
|
3,321 |
|
|
Other long-term debt |
|
|
|
681 |
|
683 |
|
|
674 |
|
|
1,364 |
|
1,352 |
|
|
|
Total interest expense |
|
|
|
10,190 |
|
9,728 |
|
|
7,008 |
|
|
19,918 |
|
11,288 |
|
Net interest income |
|
|
|
|
15,632 |
|
15,214 |
|
|
15,264 |
|
|
30,846 |
|
31,692 |
|
Provision (recapture) for credit losses |
|
|
|
412 |
|
(135 |
) |
|
319 |
|
|
277 |
|
598 |
|
|
|
Net interest income after provision (recapture) for credit
losses |
|
15,220 |
|
15,349 |
|
|
14,945 |
|
|
30,569 |
|
31,094 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
Service charges on deposit accounts |
|
|
|
428 |
|
400 |
|
|
527 |
|
|
828 |
|
866 |
|
|
Mortgage banking, net |
|
|
|
2,417 |
|
2,177 |
|
|
3,864 |
|
|
4,594 |
|
6,914 |
|
|
Interchange and ATM fees |
|
|
|
640 |
|
563 |
|
|
641 |
|
|
1,203 |
|
1,218 |
|
|
Appreciation in cash surrender value of life insurance |
|
|
320 |
|
288 |
|
|
503 |
|
|
608 |
|
783 |
|
|
Net gain (loss) on sale of available-for-sale securities |
|
|
- |
|
- |
|
|
2 |
|
|
- |
|
(222 |
) |
|
Net gain on sale/disposal of premises and equipment |
|
|
24 |
|
- |
|
|
70 |
|
|
24 |
|
83 |
|
|
Other noninterest income |
|
|
|
440 |
|
524 |
|
|
597 |
|
|
964 |
|
1,233 |
|
|
|
Total noninterest income |
|
|
|
4,269 |
|
3,952 |
|
|
6,204 |
|
|
8,221 |
|
10,875 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense: |
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
|
|
10,273 |
|
9,718 |
|
|
11,084 |
|
|
19,991 |
|
20,777 |
|
|
Occupancy and equipment expense |
|
|
|
2,104 |
|
2,099 |
|
|
2,071 |
|
|
4,203 |
|
4,144 |
|
|
Data processing |
|
|
|
1,382 |
|
1,525 |
|
|
1,572 |
|
|
2,907 |
|
2,784 |
|
|
Advertising |
|
|
|
|
316 |
|
253 |
|
|
309 |
|
|
569 |
|
590 |
|
|
Amortization |
|
|
|
|
348 |
|
369 |
|
|
397 |
|
|
717 |
|
815 |
|
|
Loan costs |
|
|
|
|
412 |
|
398 |
|
|
464 |
|
|
810 |
|
909 |
|
|
FDIC insurance premiums |
|
|
|
284 |
|
299 |
|
|
393 |
|
|
583 |
|
561 |
|
|
Professional and examination fees |
|
|
|
423 |
|
484 |
|
|
592 |
|
|
907 |
|
1,076 |
|
|
Other noninterest expense |
|
|
|
1,765 |
|
1,888 |
|
|
1,908 |
|
|
3,653 |
|
3,667 |
|
|
|
Total noninterest expense |
|
|
|
17,307 |
|
17,033 |
|
|
18,790 |
|
|
34,340 |
|
35,323 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
|
2,182 |
|
2,268 |
|
|
2,359 |
|
|
4,450 |
|
6,646 |
|
Provision for income taxes |
|
|
|
444 |
|
370 |
|
|
344 |
|
|
814 |
|
1,389 |
|
Net income |
|
|
|
|
$ |
1,738 |
$ |
1,898 |
|
$ |
2,015 |
|
$ |
3,636 |
$ |
5,257 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share |
|
|
$ |
0.22 |
$ |
0.24 |
|
$ |
0.26 |
|
$ |
0.46 |
$ |
0.67 |
|
Diluted earnings per common share |
|
|
$ |
0.22 |
$ |
0.24 |
|
$ |
0.26 |
|
$ |
0.46 |
$ |
0.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average shares outstanding |
|
|
|
7,830,925 |
|
7,824,928 |
|
|
7,789,559 |
|
|
7,827,926 |
|
7,789,872 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding |
|
|
|
7,845,272 |
|
7,835,304 |
|
|
7,793,410 |
|
|
7,840,288 |
|
7,792,937 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADDITIONAL FINANCIAL INFORMATION |
|
(Unaudited) |
|
(Dollars in thousands, except per share data) |
Three or Six Months Ended |
|
|
|
June 30, |
March 31, |
June 30, |
|
|
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
Mortgage Banking Activity (For the quarter): |
|
|
|
|
Net gain on sale of mortgage loans |
$ |
1,600 |
|
$ |
1,414 |
|
$ |
2,757 |
|
|
Net change in fair value of loans held-for-sale and
derivatives |
|
12 |
|
|
(173 |
) |
|
324 |
|
|
Mortgage servicing income, net |
|
805 |
|
|
936 |
|
|
783 |
|
|
|
Mortgage banking, net |
$ |
2,417 |
|
$ |
2,177 |
|
$ |
3,864 |
|
|
|
|
|
|
|
Mortgage Banking Activity (Year-to-date): |
|
|
|
|
Net gain on sale of mortgage loans |
$ |
3,014 |
|
|
$ |
4,960 |
|
|
Net change in fair value of loans held-for-sale and
derivatives |
|
(161 |
) |
|
|
305 |
|
|
Mortgage servicing income, net |
|
1,741 |
|
|
|
1,649 |
|
|
|
Mortgage banking, net |
$ |
4,594 |
|
|
$ |
6,914 |
|
|
|
|
|
|
|
Performance Ratios (For the quarter): |
|
|
|
|
Return on average assets |
|
0.33 |
% |
|
0.37 |
% |
|
0.40 |
% |
|
Return on average equity |
|
4.30 |
% |
|
4.67 |
% |
|
4.99 |
% |
|
Yield on average interest earning assets |
|
5.64 |
% |
|
5.47 |
% |
|
5.06 |
% |
|
Cost of
funds |
|
|
2.78 |
% |
|
2.67 |
% |
|
2.06 |
% |
|
Net interest margin |
|
3.41 |
% |
|
3.33 |
% |
|
3.47 |
% |
|
Core efficiency ratio* |
|
85.22 |
% |
|
86.95 |
% |
|
85.68 |
% |
|
|
|
|
|
|
Performance Ratios (Year-to-date): |
|
|
|
|
Return on average assets |
|
0.35 |
% |
|
|
0.53 |
% |
|
Return on average equity |
|
4.49 |
% |
|
|
6.49 |
% |
|
Yield on average interest earning assets |
|
5.55 |
% |
|
|
4.96 |
% |
|
Cost of
funds |
|
|
2.73 |
% |
|
|
1.71 |
% |
|
Net interest margin |
|
3.37 |
% |
|
|
3.66 |
% |
|
Core efficiency ratio* |
|
86.06 |
% |
|
|
81.07 |
% |
|
|
|
|
|
|
* The core efficiency
ratio is a non-GAAP ratio that is calculated by dividing
non-interest expense, exclusive of acquisition |
costs and intangible asset amortization, by the sum of net interest
income and non-interest income. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADDITIONAL FINANCIAL INFORMATION |
|
|
|
(Dollars in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
Asset Quality Ratios and Data: |
As of or for the Three Months Ended |
|
|
|
June 30, |
March 31, |
June 30, |
|
|
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
|
Nonaccrual
loans |
|
$ |
4,012 |
|
$ |
5,231 |
|
$ |
9,561 |
|
|
Loans 90 days past due and still accruing |
|
1,076 |
|
|
1,979 |
|
|
369 |
|
|
|
Total
nonperforming loans |
|
5,088 |
|
|
7,210 |
|
|
9,930 |
|
|
Other real estate owned and other repossessed assets |
|
4 |
|
|
- |
|
|
- |
|
|
|
Total
nonperforming assets |
$ |
5,092 |
|
$ |
7,210 |
|
$ |
9,930 |
|
|
|
|
|
|
|
|
Nonperforming loans / portfolio loans |
|
0.34 |
% |
|
0.48 |
% |
|
0.70 |
% |
|
Nonperforming assets / assets |
|
0.24 |
% |
|
0.35 |
% |
|
0.49 |
% |
|
Allowance for credit losses / portfolio loans |
|
1.11 |
% |
|
1.10 |
% |
|
1.09 |
% |
|
Allowance for credit losses/ nonperforming loans |
|
330.78 |
% |
|
227.60 |
% |
|
156.70 |
% |
|
Gross loan charge-offs for the quarter |
$ |
12 |
|
$ |
1 |
|
$ |
55 |
|
|
Gross loan recoveries for the quarter |
$ |
10 |
|
$ |
66 |
|
$ |
206 |
|
|
Net loan charge-offs (recoveries) for the quarter |
$ |
2 |
|
$ |
(65 |
) |
$ |
(151 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
March 31, |
June 30, |
|
|
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
Capital Data (At quarter end): |
|
|
|
|
Common shareholders' equity (book value) per share |
$ |
21.23 |
|
$ |
21.07 |
|
$ |
20.37 |
|
|
Tangible book value per share** |
$ |
16.25 |
|
$ |
16.05 |
|
$ |
15.19 |
|
|
Shares outstanding |
|
8,016,784 |
|
|
8,016,784 |
|
|
7,988,132 |
|
|
Tangible common equity to tangible assets*** |
|
6.33 |
% |
|
6.32 |
% |
|
6.12 |
% |
|
|
|
|
|
|
Other Information: |
|
|
|
|
|
Average investment securities for the quarter |
$ |
306,207 |
|
$ |
314,129 |
|
$ |
343,634 |
|
|
Average investment securities year-to-date |
$ |
310,168 |
|
$ |
314,129 |
|
$ |
344,330 |
|
|
Average loans for the quarter **** |
$ |
1,513,313 |
|
$ |
1,499,293 |
|
$ |
1,407,316 |
|
|
Average loans year-to-date **** |
$ |
1,506,303 |
|
$ |
1,499,293 |
|
$ |
1,387,153 |
|
|
Average earning assets for the quarter |
$ |
1,837,418 |
|
$ |
1,830,316 |
|
$ |
1,766,706 |
|
|
Average earning assets year-to-date |
$ |
1,833,867 |
|
$ |
1,830,316 |
|
$ |
1,745,870 |
|
|
Average total assets for the quarter |
$ |
2,077,448 |
|
$ |
2,066,579 |
|
$ |
1,998,957 |
|
|
Average total assets year-to-date |
$ |
2,072,013 |
|
$ |
2,066,579 |
|
$ |
1,973,167 |
|
|
Average deposits for the quarter |
$ |
1,625,882 |
|
$ |
1,625,770 |
|
$ |
1,580,343 |
|
|
Average deposits year-to-date |
$ |
1,625,826 |
|
$ |
1,625,770 |
|
$ |
1,592,879 |
|
|
Average equity for the quarter |
$ |
161,533 |
|
$ |
162,637 |
|
$ |
161,534 |
|
|
Average equity year-to-date |
$ |
162,084 |
|
$ |
162,637 |
|
$ |
161,910 |
|
|
|
|
|
|
|
** The tangible book value per share is a non-GAAP ratio that is
calculated by dividing shareholders' equity, |
|
less goodwill and core deposit intangible, by common shares
outstanding. |
|
|
|
*** The tangible common equity to tangible assets is a non-GAAP
ratio that is calculated by dividing shareholders' |
|
equity, less goodwill and core deposit intangible, by total assets,
less goodwill and core deposit intangible. |
|
**** Includes loans held for sale |
|
|
|
Reconciliation of Non-GAAP Financial Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core Efficiency Ratio |
|
(Unaudited) |
|
|
(Unaudited) |
|
(Dollars in thousands) |
Three Months Ended |
|
Six Months
Ended |
|
|
|
|
|
|
June 30, |
March 31, |
June 30, |
|
June 30, |
|
|
|
|
|
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
|
Calculation of Core Efficiency Ratio: |
|
|
|
|
|
|
|
|
Noninterest expense |
$ |
17,307 |
|
$ |
17,033 |
|
$ |
18,790 |
|
|
$ |
34,340 |
|
$ |
35,323 |
|
|
|
Intangible asset amortization |
|
(348 |
) |
|
(369 |
) |
|
(397 |
) |
|
|
(717 |
) |
|
(815 |
) |
|
|
|
Core efficiency ratio numerator |
|
16,959 |
|
|
16,664 |
|
|
18,393 |
|
|
|
33,623 |
|
|
34,508 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
15,632 |
|
|
15,214 |
|
|
15,264 |
|
|
|
30,846 |
|
|
31,692 |
|
|
|
Noninterest income |
|
4,269 |
|
|
3,952 |
|
|
6,204 |
|
|
|
8,221 |
|
|
10,875 |
|
|
|
|
Core efficiency ratio denominator |
|
19,901 |
|
|
19,166 |
|
|
21,468 |
|
|
|
39,067 |
|
|
42,567 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core efficiency ratio (non-GAAP) |
|
85.22 |
% |
|
86.95 |
% |
|
85.68 |
% |
|
|
86.06 |
% |
|
81.07 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible Book Value and Tangible Assets |
|
(Unaudited) |
|
(Dollars in thousands, except per share data) |
|
June 30, |
March 31, |
June 30, |
|
|
|
|
|
|
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
Tangible Book Value: |
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
$ |
170,162 |
|
$ |
168,948 |
|
$ |
162,725 |
|
|
|
Goodwill and core deposit intangible, net |
|
|
(39,908 |
) |
|
(40,254 |
) |
|
(41,388 |
) |
|
|
|
Tangible common shareholders' equity (non-GAAP) |
$ |
130,254 |
|
$ |
128,694 |
|
$ |
121,337 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shares outstanding at end of period |
|
8,016,784 |
|
|
8,016,784 |
|
|
7,988,132 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shareholders' equity (book value) per share (GAAP) |
$ |
21.23 |
|
$ |
21.07 |
|
$ |
20.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common shareholders' equity (tangible book value) |
|
|
|
|
|
|
per share (non-GAAP) |
|
|
$ |
16.25 |
|
$ |
16.05 |
|
$ |
15.19 |
|
|
|
|
|
|
|
|
|
|
|
|
Tangible Assets: |
|
|
|
|
|
|
|
|
Total assets |
|
|
|
$ |
2,098,955 |
|
$ |
2,076,074 |
|
$ |
2,023,279 |
|
|
|
Goodwill and core deposit intangible, net |
|
|
(39,908 |
) |
|
(40,254 |
) |
|
(41,388 |
) |
|
|
|
Tangible assets (non-GAAP) |
|
$ |
2,059,047 |
|
$ |
2,035,820 |
|
$ |
1,981,891 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common shareholders' equity to tangible assets |
|
|
|
|
|
|
(non-GAAP) |
|
|
|
|
6.33 |
% |
|
6.32 |
% |
|
6.12 |
% |
|
|
|
|
|
|
|
|
|
|
|
Contacts: Laura F. Clark, President and CEO(406)
457-4007Miranda J. Spaulding, SVP and CFO(406) 441-5010
Eagle Bancorp Montana (NASDAQ:EBMT)
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From Aug 2024 to Sep 2024
Eagle Bancorp Montana (NASDAQ:EBMT)
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From Sep 2023 to Sep 2024