RICHMOND, Ind., Aug. 13, 2019 /PRNewswire/ -- Richmond
Mutual Bancorporation, Inc., a Maryland corporation (the "Company") (NASDAQ:
RMBI), parent company of First Bank Richmond (the "Bank"), today
announced net income for the three months ended June 30, 2019 of $335,000, a $1.0
million decrease from net income of $1.4 million for the three months ended
June 30, 2018. Net income for
the second quarter of 2019 was impacted by a non-recurring
$1.3 million after-tax expense
related to the adoption of the nonqualified deferred compensation
plan during the quarter. Excluding this non-recurring
expense, net income for the quarter ended June 30, 2019 increased $260,000 compared to the same quarter in
2018. Net income was $1.7
million for the first six months of 2019, compared to
$2.6 million in the first six months
of 2018.
Effective July 1, 2019, the Bank
completed its conversion from a mutual holding company to a stock
holding company form of organization and the Company completed its
related initial public offering. The Company sold 13,026,625
shares of common stock at $10.00 per
share, for gross offering proceeds of approximately $130.3 million and contributed 500,000 shares and
$1.25 million to a newly formed
charitable foundation, First Bank Richmond, Inc. Community
Foundation.
As of June 30, 2019, the
reorganization had not been completed and Richmond Mutual
Bancorporation, Inc., a Delaware
corporation, owned 100% of the outstanding shares of common stock
of the Bank. In addition, as of that date, the Company had no
assets or liabilities and had not conducted any business activities
other than organizational activities. Accordingly, the
financial results for the three and six months ended June 30, 2019 and for prior comparative periods
relate to the consolidated operations of the Bank and its former
holding company only.
President's Comments
Garry Kleer, Chairman, President
and Chief Executive Officer of the Company stated, "We are very
pleased to report our second quarter earnings, our first earnings
results as a public company following our conversion and listing on
the Nasdaq Capital Market. We are also extremely pleased with our
successful, oversubscribed stock offering completed in July. The
more than $130.0 million of
additional capital raised in the offering will allow us to
strategically grow our footprint while continuing to preserve
hometown banking in the communities we serve. Our strategy
moving forward is to continue to leverage the capital raised in a
safe and disciplined way; allowing for sustained growth in order to
create maximum value for our shareholders."
Balance Sheet Summary
Total assets increased $233.4
million, or 27.5%, to $1.08
billion at June 30, 2019 from
$849.6 million at December 31, 2018. This increase was primarily
driven by a $207.0 million increase
in deposits, which included approximately $180.0 million of subscription funds deposited
with First Bank Richmond to purchase shares of common stock of
Richmond Mutual Bancorporation-Maryland in its initial public
offering. The loan and lease portfolio, net of allowance for
loan and lease losses, increased $36.4
million or 5.6% from year end, while investments increased
$10.5 million, or 7.3%.
Our allowance for loan and lease losses increased $681,000, or 12.2%, to $6.3 million at June 30,
2019 from $5.6 million at
December 31, 2018, primarily as a
result of the increased commercial real estate and construction and
development loans in our loan and lease portfolio. At June 30, 2019, the allowance for loan and lease
losses totaled 0.90% of total loans and leases outstanding compared
to 0.85% at December 31, 2018.
Total deposits increased $207.0
million, or 33.4%, to $827.6
million at June 30, 2019 from
$620.6 million at December 31, 2018. The increase in deposits
was primarily related to approximately $180.0 million of subscription funds deposited
with First Bank Richmond to purchase shares of common stock of
Richmond Mutual Bancorporation-Maryland in its initial public
offering that was completed July 1,
2019. Brokered deposits decreased $22.3 million, or 18.0%, during the first six
months of 2019. At June 30,
2019, our brokered deposits totaled $102.1 million, or 12.3% of total deposits,
compared to $124.5 million, or 15.0%
of total deposits at December 31,
2018.
Stockholders' equity totaled $91.0
million as of June 30, 2019,
an increase of $5.2 million, or 6.0%,
from December 31, 2018. The increase
in stockholders' equity was due to net income of $2.0 million and a $3.5
million reduction in the accumulated other comprehensive
loss. First Bank Richmond's tangible common equity ratio and
its risk-based capital ratios exceeded "well-capitalized" levels as
defined by all regulatory standards as of June 30, 2019.
Income Statement Summary
Net interest income before the provision for loan and lease
losses increased $673,000, or 9.9%,
to $7.5 million during the second
quarter of 2019 compared to $6.8
million for the second quarter of 2018 and increased
$1.2 million, or 9.0%, to
$14.6 million in the first six months
of 2019 compared to $13.4 million for
the first six months of 2018. The increases were due to increases
in interest-earning assets during the three and six months ended
June 30, 2019 compared to the
comparable periods in 2018, which offset a 28 basis point decline
in the net interest margin in the second quarter of 2019 to 3.27%
compared to 3.55% for the second quarter of 2018 and a 20 basis
point decline in the net interest margin in the first six months of
2019 to 3.35% compared to 3.55% for the first six months of
2018.
The provision for loan and lease losses for the three months
ended June 30, 2019 totaled
$485,000 compared to $450,000 for the three months ended June 30, 2018, a $35,000 or 7.8% increase. The provision for
loan and lease losses for the six months ended June 30, 2019 totaled $1.0
million compared to $900,000
for the six months ended June 30,
2018, a $100,000 or 11.1%
increase. The higher provision for both periods was due to the
increase in the size of the loan portfolio, primarily commercial
real estate and construction and development loans. Net
charge-offs during the three and six months ended June 30, 2019 were $40,000 and $329,000, respectively, compared to $68,000 and $67,000
for the three and six months ended June 30,
2018.
Total non-interest income decreased $1,000, or 0.1%, to $900,000 for the three months ended June 30, 2019, compared to $901,000 for the same period in 2018. Total
non-interest income increased $64,000, or 3.7%, to $1.8
million for the six months ended June
30, 2019, compared to $1.7
million for the same period in 2018. The increase for the
six months ended June 30, 2018 was
primarily due to a $68,000 increase
in loan and lease servicing fees resulting from a higher volume of
loan and lease originations during the period. In addition, we
recorded a $49,000 net gain on
securities during the first half of 2019, compared to a
$12,000 gain recorded during the
comparable period in 2018. These increases were partially offset by
a $43,000 decrease in service charges
on deposit accounts during the six months ended June 30, 2019 compared to the first six months of
2018. Other income also declined $51,000 during the first six months of 2019
compared to the first six months of 2018.
Total non-interest expense increased $2.1
million, or 37.0%, to $7.6
million during the three months ended June 30, 2019, compared to $5.5 million for the same period in 2018.
Salaries and employee benefits increased $1.9 million, or 55.9%, to $5.3 million during the second quarter of 2019
compared to $3.4 million during the
second quarter of 2018. This increase was primarily due to
the $1.7 million pre-tax expense
related to the adoption of a nonqualified deferred compensation
plan during the second quarter of 2019. Excluding this
expense, salaries and employee benefits increased $173,000, or 5.0%, for the three months ended
June 30, 2019 compared to the three
months ended June 30, 2018.
Data processing fees increased $50,000, or 13.4%, during the three months ended
June 30, 2019 compared to
June 30, 2018, primarily attributable
to higher transaction volume. Legal and professional fees
increased $69,000, or 49.3%, in the
second quarter of 2019 compared to the same period in 2018,
primarily as a result of the reorganization. Advertising
expenses increased $56,000, or 47.9%
for the three months ended June 30,
2019 compared to the three months ended June 30, 2018. Other expenses decreased
$36,000, or 5.1%, to $672,000 for the quarter ended June 30, 2019 compared to $708,000 for the three months ended June 30, 2018, primarily due to lower postage and
phone expense.
Total non-interest expense increased $2.4
million, or 22.0%, to $13.4
million during the six months ended June 30, 2019, compared to $11.0 million for the same period in 2018.
Salaries and employee benefits increased $1.9 million, or 28.3%, to $8.8 million in the first six months of 2019
compared to $6.9 million for the
first six months of 2018, primarily due to a $1.7 million pre-tax expense associated with the
adoption of the nonqualified deferred compensation plan.
Merit increases and higher related benefits accounted for the
remainder of the increase. Data processing fees increased
$93,000 or 12.5% and FDIC assessments
increased $31,000 or 11.8% during the
six months ended June 30, 2019
compared to June 30, 2018. The
increase in data processing fees primarily was a result of higher
transaction volume while the increase in FDIC assessments was
attributable to the increase in our asset size and a higher amount
of average brokered deposits held in 2019 compared with 2018.
Legal and professional fees also increased $224,000, or 79.4%, in the first half of 2019
compared to the same period in 2018, primarily as a result of the
reorganization. Loan, tax and insurance expense decreased by
$47,000, or 48.5%, due to a recovery
of $84,000 in property taxes that
were advanced in 2018.
Income tax expense decreased by $380,000, to a $42,000 income tax benefit during the three
months ended June 30, 2019, compared
to the same period in 2018 and decreased by $346,000, or 55.3%, to $280,000 during the six months ended June 30, 2019, compared to the same period in
2018. The decreases primarily were due to lower pre-tax
income during the three and six month periods in 2019 compared to
the same periods in 2018.
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
SELECTED
OPERATIONS DATA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
$
10,398,501
|
|
$
8,595,328
|
|
$
20,155,398
|
|
$
16,758,090
|
Interest
expense
|
2,916,025
|
|
1,784,721
|
|
5,552,987
|
|
3,396,649
|
|
7,482,476
|
|
6,810,607
|
|
14,602,411
|
|
13,361,441
|
Provision for loan
and lease losses
|
485,000
|
|
450,000
|
|
1,010,000
|
|
900,000
|
Net interest income
after provision for loan losses
|
6,997,476
|
|
6,360,607
|
|
13,592,411
|
|
12,461,441
|
Noninterest
income
|
899,905
|
|
901,480
|
|
1,804,360
|
|
1,740,459
|
Noninterest
expense
|
7,603,956
|
|
5,548,457
|
|
13,408,997
|
|
10,987,985
|
Income before income
tax expense
|
293,425
|
|
1,713,630
|
|
1,987,774
|
|
3,213,915
|
Income tax expense
(benefit)
|
(41,700)
|
|
338,700
|
|
280,400
|
|
626,600
|
Net income
|
335,125
|
|
1,374,930
|
|
1,707,374
|
|
2,587,315
|
|
June
30,
|
|
December
31,
|
|
2019
|
|
2018
|
|
(Unaudited)
|
|
|
SELECTED FINANCIAL
CONDITION DATA:
|
|
|
|
|
|
|
|
Total
assets
|
$
1,083,657,913
|
|
$
849,618,363
|
Cash and cash
equivalents
|
203,055,280
|
|
14,971,170
|
Investment
securities
|
154,039,285
|
|
143,562,461
|
Loans and leases, net
of allowance for losses
|
691,124,194
|
|
654,755,066
|
Premises and
equipment, net
|
13,940,120
|
|
14,025,476
|
Federal Home Loan
Bank stock
|
7,510,400
|
|
6,560,600
|
Other
assets
|
13,988,634
|
|
15,743,590
|
Deposits
|
827,628,862
|
|
620,636,820
|
Borrowings
|
157,100,000
|
|
136,100,000
|
Total stockholders'
equity
|
91,013,594
|
|
85,832,032
|
|
|
|
|
ASSET QUALITY
RATIOS:
|
|
|
|
|
|
|
|
Allowance for loan
and lease losses to total loans and leases
|
0.90%
|
|
0.85%
|
Allowance for loan
and lease losses to non-performing loans and leases
|
151.94%
|
|
122.40%
|
Nonperforming loans
to total loans
|
0.60%
|
|
0.69%
|
Nonperforming assets
to total assets
|
0.39%
|
|
0.56%
|
Net charge-offs
(annualized) to average loans and leases outstanding
|
0.10%
|
|
0.14%
|
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SOURCE Richmond Mutual Bancorporation, Inc.