RICHMOND, Ind., July 22, 2021 /PRNewswire/ -- Richmond
Mutual Bancorporation, Inc., a Maryland corporation (the "Company") (NASDAQ:
RMBI), parent company of First Bank Richmond (the "Bank"), today
announced net income of $2.8 million,
or $0.24 diluted earnings per share,
for the second quarter of 2021, compared to net income of
$2.6 million, or $0.22 diluted earnings per share, for the first
quarter of 2021, and net income of $2.5
million, or $0.20 diluted
earnings per share, for the second quarter of 2020.
President's Comments
Garry Kleer, Chairman, President
and Chief Executive Officer, commented, "Our quarterly results
continue to be encouraging, despite the low interest rate
environment and the difficulties we all face due to COVID-19. As a
result, during the second quarter of 2021, we substantially
completed our second 5% stock repurchase program and announced a
new 10% stock repurchase program. We also paid a special common
stock dividend of $0.50 per share, as
well as our regular quarterly cash dividend, during the quarter.
These steps demonstrate our commitment to continue to return excess
capital responsibly to our shareholders.
"During the second quarter of 2021, we also continued to assist
our clients and others in our communities through the second round
of the Paycheck Protection Program and worked with our customers
that required COVID-19 related loan modifications. We will continue
to proactively monitor modified loans and other loans we consider
at heightened risk," concluded Kleer.
Our Response to COVID-19 Pandemic
Loan Programs. On December 27, 2020, the Consolidated
Appropriations Act, 2021 ("CAA") was signed into law. This
legislation included another round of COVID-19 stimulus funding,
including approximately $285 billion
in funding to reopen the U.S. Small Business Administration's
("SBA") Paycheck Protection Program ("PPP") which initially expired
on August 8, 2020. The new round of
COVID-19 stimulus funding under the PPP concluded May 31, 2021. During the second quarter of 2021
we processed 81 applications for new PPP loans totaling
$3.0 million. As of June 30, 2021, we had funded a total of 892 PPP
loans totaling $103.1 million and the
SBA had approved 524 loan forgiveness applications totaling
$68.5 million with no additional
applications pending approval. PPP loans totaled $34.6 million at June 30,
2021.
Loan Modifications. We offer payment and
financial relief programs for borrowers impacted by COVID-19,
primarily through loan and lease payment deferments of principal
and interest up to 90 days, although requests for payment relief
during the second quarter of 2021 have significantly declined. We
continue to monitor our loan portfolio and strive to work with our
customers and communities. Deferred loans and leases are
re-evaluated at the end of the initial deferral period and will
either return to the original loan or lease terms or be reassessed
at that time to determine if a further modification should be
granted and if a downgrade in risk rating is appropriate. At
June 30, 2021, we had six loans and
leases that were subject to payment deferrals, representing
$2.5 million in loans and leases
outstanding, down from 33 loans and leases at March 31, 2021 totaling $24.6 million. Deferred loans relating to higher
risk segments of our portfolio are closely monitored, such as
hospitality loans including restaurants and hotels. As of
June 30, 2021, we had no deferred
loans relating to this portion of our portfolio, compared to five
loans totaling $16.4 million at
March 31, 2021, and 13 loans totaling
$37.4 million at December 31, 2020. Of the loans currently
deferred at June 30, 2021, none were
new deferrals and all were repeat deferrals.
The following table summarizes information relating to loan
deferments at quarter ended June 30,
2021 and March 31, 2021:
|
June 30,
2021
|
|
March 31,
2021
|
($ in
thousands)
|
Number of
Loans
|
|
Balance
|
|
Number of
Loans
|
|
Balance
|
Commercial
mortgage
|
1
|
|
$
|
2,099
|
|
|
8
|
|
$
|
23,372
|
|
Commercial and
industrial
|
—
|
|
—
|
|
|
—
|
|
—
|
|
Multi-Family
|
—
|
|
—
|
|
|
—
|
|
—
|
|
Residential
mortgage
|
4
|
|
376
|
|
|
5
|
|
450
|
|
Direct financing
leases
|
1
|
|
70
|
|
|
19
|
|
756
|
|
Consumer
|
—
|
|
—
|
|
|
1
|
|
4
|
|
Total
Loans
|
6
|
|
$
|
2,545
|
|
|
33
|
|
$
|
24,582
|
|
Branch Operations and Support
Personnel. Certain employees continue to work remotely
or have flexible work schedules while protective measures are in
place within our offices to help ensure the safety of those
employees on-site as normal branch activities have resumed. We
continuously monitor and conform our practices based on updates
from the Center for Disease Control, World Health Organization,
Financial Regulatory Agencies, and local and state health
departments.
Capital Strength. At June
30, 2021, the Company's stockholders' equity totaled
$182.6 million, a $10.1 million or 5.3% decrease from the year
ended December 31, 2020. The
Company's equity to asset ratio was 15.36% at June 30, 2021. At June 30,
2021, the Bank's Tier I capital to total assets was 13.68%
and the Bank's capital was well in excess of all regulatory
requirements.
Second Quarter Performance Highlights:
- Assets totaled $1.2 billion at
June 30, 2021, compared to
$1.1 billion at both March 31, 2021 and December 31, 2020.
- Loans and leases, net of allowance, totaled $785.3 million at June 30,
2021, compared to $762.8 at
March 31, 2021 and $734.4 million at December
31, 2020.
- Nonperforming loans and leases totaled $7.7 million, or 0.97% of total loans and leases,
at June 30, 2021, compared to
$8.1 million, or 1.05% at
March 31, 2021 and $4.8 million, or 0.65% of total loans and leases,
at December 31, 2020.
- The allowance for loan and lease losses totaled $11.4 million, or 1.43% of total loans and leases
outstanding, at June 30, 2021,
compared to $11.0 million, or 1.41%
at March 31, 2021 and $10.6 million, or 1.42% of total loans and leases
outstanding at December 31,
2020.
- The provision for loan and lease losses totaled $530,000 in the current quarter, compared to
$400,000 in the preceding quarter,
and $1.3 million in the second
quarter of 2020.
- Deposits totaled $793.1 million
at June 30, 2021, compared to
$757.1 million at March 31, 2021 and $693.0
million at December 31, 2020.
At June 30, 2021, noninterest bearing
deposits totaled $110.5 million or
13.9% of total deposits, compared to $118.1
million or 15.6% of total deposits at March 31, 2021 and $98.7
million or 14.2% of total deposits at December 31, 2020.
- Net interest income increased $189,000 or 2.2% to $8.9
million for the three months ended June 30, 2021, compared to net interest income of
$8.8 million for the prior quarter,
and increased $901,000 or 11.2% from
$8.0 million for the comparable
quarter in 2020.
- Annualized net interest margin was 3.18% for the current
quarter, compared to 3.44% in the preceding quarter and 3.03% in
the second quarter a year ago.
- The Company repurchased 370,019 shares of common stock at an
average price of $14.15 per share
during the quarter ended June 30,
2021.
- The Bank remains a "well-capitalized" institution for
regulatory capital purposes at June 30,
2021.
Balance Sheet Summary
Total assets increased $104.3
million, or 9.6%, to $1.2
billion at June 30, 2021, from
$1.1 billion at December 31, 2020. The increase was primarily a
result of a $50.9 million, or 6.9%,
increase in loans and leases, net of allowance, to $785.3 million at June 30,
2021 from $734.4 million at
December 31, 2020, and an
$82.9 million, or 32.3%, increase in
investment securities to $339.6
million at June 30, 2021,
compared to $256.7 million at
December 31, 2020. The increase
in loans and leases was attributable to an increase in multi-family
loans of $24.5 million, an increase
in construction and development loans of $22.3 million, and an increase in residential
loans and leases of $3.9 and
$3.8 million respectively.
Commercial and industrial loans declined $5.8 million due to a decrease in PPP loans of
$8.7 million. Loans held for sale
totaled $603,000, $889,000 and $2.0
million at June 30, 2021,
March 31, 2021 and December 31, 2020, respectively. The increase in
investment securities was primarily the result of using our excess
liquidity to purchase securities during the first six months of
2021. The balance of the change in assets was attributable to
a $31.7 million, or 65.0%, decrease
in cash and cash equivalents to $17.1
million at June 30, 2021, from
$48.8 million at December 31, 2020.
Nonperforming loans and leases, consisting of nonaccrual loans
and leases and accruing loans and leases more than 90 days past
due, totaled $7.7 million or 0.97% of
total loans and leases at June 30,
2021, compared to $8.1 million
or 1.05% of total loans at March 31,
2021 and $4.8 million or 0.65%
of total loans at December 31, 2020.
The increase in nonperforming loans and leases from December 31, 2020 was the result of a
$4.9 million nonaccrual commercial
real estate loan more than 90 days past due that is currently
subject to litigation between the developer and other parties. At
the time of origination, this loan had a loan to value ratio of
73%. Accruing loans past due more than 90 days at June 30, 2021 totaled $2.0
million, compared to $2.5
million at March 31, 2021 and
$4.0 million at December 31, 2020.
The allowance for loan and lease losses increased $472,000, or 4.3%, to $11.4 million at June 30,
2021 from $11.0 million at
March 31, 2021 and increased
$845,000, or 8.0%, from $10.6 million at December
31, 2020. At June 30, 2021,
the allowance for loan and lease losses totaled 1.43% of total
loans and leases outstanding compared to 1.41% at March 31, 2021 and 1.42% at December 31, 2020. The allowance for loan and
lease losses to total loans at June 30,
2021, March 31, 2021, and
December 31, 2020 would increase
seven, 11, and eight basis points, respectively, if PPP loans,
which totaled $34.6 million,
$54.7 million, and $43.3 million at June 30,
2021, March 31, 2021 and
December 31, 2020, respectively, and
are 100% guaranteed by the SBA, are excluded from the calculation.
Net charge-offs during the first six months of 2021 were
$86,000 or 0.02% of average loans and
leases outstanding, compared to net charge-offs of $98,000 during the first six months of 2020.
Management regularly analyzes conditions within its geographic
markets and evaluates its loan and lease portfolio. The Company
evaluated its exposure to potential loan and lease losses as of
June 30, 2021, which evaluation
included consideration of potential credit losses due to economic
conditions driven by the impact of the COVID-19 pandemic. The
full impact of the pandemic on the Company's deposit and loan
customers is still not fully known at this time. The Company has
increased its qualitative factors when determining the adequacy of
its allowance for loan and lease losses. Credit metrics are being
reviewed and stress testing is being performed on the loan
portfolio on an ongoing basis. Potentially higher risk segments of
the portfolio, such as hotels and restaurants, are being closely
monitored as are loan payment deferrals.
Total deposits increased $36.0
million, or 4.8%, to $793.1
million at June 30, 2021,
compared to $757.1 million at
March 31, 2021 and increased
$100.0 million, or 14.4%, from
$693.0 million at December 31, 2020. The increase in deposits from
March 31, 2021 and December 31, 2020 primarily was due to overall
changes in spending and savings habits by businesses and consumers
due to the COVID-19 pandemic as well as additional PPP funds and
stimulus payments made in December
2020 and first quarter 2021. Brokered deposits increased
$15.0 million to $41.7 million, or 5.3% of total deposits, at
June 30, 2021 compared to
$26.7 million, or 3.5% of total
deposits, at March 31, 2021 and
increased $18.4 million from
$23.3 million, or 3.4% of total
deposits, at December 31, 2020.
Management increased longer-term brokered deposits as a result of
continued low rates being offered in the brokered CD market.
Interest-bearing demand deposit and savings accounts increased
$19.5 million, or 5.1%, to
$402.1 million at June 30, 2021 from $382.6
million at March 31, 2021, and
increased $50.2 million, or 14.3%,
from $351.9 million at December 31, 2020. Noninterest-bearing demand
deposits decreased $7.6 million, or
6.4%, to $110.5 million at
June 30, 2021 from $118.1 million at March
31, 2021, and increased $11.8
million, or 12.0%, from $98.7
million at December 31, 2020.
At June 30, 2021, noninterest bearing
deposits totaled 13.9% of total deposits, compared to 15.6% of
total deposits at March 31, 2021 and
14.2% of total deposits at December 31,
2020.
Stockholders' equity totaled $182.6
million at June 30, 2021, a
decrease of $7.0 million or 3.7% from
March 31, 2021 and a decrease of
$10.1 million or 5.3% from
December 31, 2020. The decrease in
stockholders' equity from March 31,
2021 primarily was the result of the repurchase of
$5.2 million of Company common stock
and the payment of $6.8 million in
dividends to Company stockholders, partially offset by net income
of $2.8 million. The decrease in
stockholders' equity from the year ended December 31, 2020 primarily was the result of a
reduction in accumulated comprehensive income of $2.0 million, the repurchase of $7.2 million of Company common stock and the
payment of $7.7 million in dividends
to Company stockholders, partially offset by net income of
$5.3 million.
During the quarter ended June 30,
2021, the Company repurchased a total of 370,019 shares of
Company common stock at an average price of $14.15 per share. As of June 30, 2021, the Company had approximately
1,310,407 shares available for repurchase under its existing stock
repurchase programs. Subsequent to quarter end through July 22, 2021, the Company purchased an
additional 145,795 shares, leaving 1,164,612 shares available for
future repurchase.
Income Statement Summary
Net interest income before the provision for loan and lease
losses increased $162,000, or 1.9%,
to $8.9 million in the second quarter
of 2021, compared to $8.8 million in
the first quarter of 2021 and increased $902,000, or 11.2%, from $8.0 million in the second quarter of 2020. The
increase from the first quarter of 2021 was due to an increase in
average interest-earning assets during the second quarter of 2021,
partially offset by a 27 basis point decrease in the interest rate
spread. The increase from the comparable quarter in 2020 was due to
both an increase in average interest-earning assets during the
second quarter of 2021 compared to the comparable quarter of 2020
and a 25 basis point increase in the net interest rate spread
during the second quarter of 2021 compared to the comparable
quarter in 2020.
Interest income increased $203,000, or 1.9%, to $10.8 million during the quarter ended
June 30, 2021, compared to
$10.6 million during the quarter
ended March 31, 2021 and increased
$349,000, or 3.3%, compared to
$10.5 million during the quarter
ended June 30, 2020. Interest income
on loans and leases was steady at $9.6
million for the quarter ended June
30, 2021 and the first quarter of 2021, and increased
$284,000, or 3.1%, from $9.3 million for the comparable quarter in
2020. The average outstanding loan and lease balances were
$778.4 million for the quarter ended
June 30, 2021, compared to
$718.0 million for the quarter ended
March 31, 2021 and $747.9 million for the quarter ended June 30, 2020. The average yield on loans was
4.93% for the quarter ended June 30,
2021, compared to 5.36% and 4.98% for the quarters ended
March 31, 2021 and June 30, 2020, respectively.
Interest income on investment securities, including FHLB stock,
increased $240,000, or 23.7%, to
$1.2 million during the quarter ended
June 30, 2021, compared to
$1.0 million during the quarter ended
March 31, 2021, and increased
$70,000, or 6.0%, from the comparable
quarter in 2020. The increase in interest income on investment
securities, including FHLB stock, from the previous quarter was
primarily due to an increase in average balances of $52.6 million, and an increase in yield of five
basis points, while the increase from the comparable period in 2020
was due to an increase in the average balances of $65.7 million partially offset by a decrease in
the weighted average yield of 29 basis points. The average balance
of investment securities, including FHLB stock, was $322.4 million for the quarter ended June 30, 2021, compared to $269.8 million and $256.6
million for the quarters ended March
31, 2021 and June 30, 2020,
respectively. The average yield on investment securities, including
FHLB stock, was 1.55% for the second quarter of 2021, compared to
1.50% and 1.84% for the first quarter of 2021 and the second
quarter of 2020, respectively.
Interest expense increased $41,000, or 2.2%, to $1.9
million for the quarter ended June
30, 2021, compared to the first quarter of 2021, and
decreased $553,000, or 22.3%, from
$2.5 million for the quarter ended
June 30, 2020. Interest expense on
deposits increased $34,000, or 2.9%,
to $1.2 million for the quarter ended
June 30, 2021, compared to the
previous quarter and decreased $483,000, or 28.3%, from $1.7 million for the comparable quarter in 2020.
The increase in the current quarter was attributable to an
increase in average interest-bearing deposit balances of
$61.8 million, partially offset by a
five basis point decrease in the weighted average rate paid on
interest-bearing deposits. The decrease from the comparable
quarter in 2020 was due to a decrease of 41 basis points in the
average rate paid on interest-bearing deposits, partially offset by
an increase of $73.9 million in
average interest-bearing deposit balances. The weighted average
rate paid on interest-bearing deposits was 0.72% for the quarter
ended June 30, 2021, compared to
0.77% and 1.13% for the quarters ended March
31, 2021 and June 30, 2020,
respectively. Interest expense on FHLB borrowings increased
$7,000, or 1.0%, to $701,000 for the second quarter of 2021 compared
to $694,000 during the previous
quarter and decreased $70,000, or
9.0%, from $770,000 for the
comparable quarter in 2020. The average balance of FHLB borrowings
totaled $173.1 million during the
quarter ended June 30, 2021, compared
to $170.0 million and $181.8 million for the quarters ended
March 31, 2021 and June 30, 2020, respectively. The weighted average
rate paid on FHLB borrowings was 1.62% for the quarter ended
June 30, 2021, 1.63% for March 31, 2021, and 1.69% for the second quarter
of 2020.
Annualized net interest margin was 3.18% for the second quarter
of 2021, compared to 3.44% and 3.03% for the first quarter of 2021
and second quarter of 2020, respectively. The decrease in the net
interest margin for the second quarter of 2021 compared to the
first quarter of 2021 primarily was due to a 27 basis point decline
in the net interest rate spread, partially offset by the increase
in average interest-earning assets. The increase in the net
interest margin for the current quarter compared to the comparable
quarter in 2020 was due to both an increase in average earning
assets and a 25 basis point increase in the net interest rate
spread.
The provision for loan and lease losses totaled $530,000 for the three months ended June 30, 2021, compared to $400,000 for the quarter ended March 31, 2021 and $1.3
million for the quarter ended June
30, 2020. The provision for loan and lease losses recorded
in the quarter ended June 30, 2021
primarily reflected the continued uncertainty of the economic
impact of the COVID-19 pandemic and the effects of the government's
response to the pandemic on the Bank's loan portfolio, as well as
the increase in non-performing loans experienced in the first half
of 2021. Net charge-offs during the second quarter of 2021 were
$58,000, compared to $27,000 during the first quarter of 2021 and
$106,000 in the second quarter of
2020. While we believe the steps we have taken and continue to take
are necessary to effectively manage our portfolio and assist our
clients through the ongoing uncertainty surrounding the duration,
impact and government response to the COVID-19 pandemic,
uncertainties relating to our allowance for loan losses are
heightened as a result of the risks surrounding the COVID-19
pandemic, including whether government relief will provide adequate
relief to borrowers. The ultimate impact will depend on future
developments, including the scope and duration of the pandemic and
further actions taken by government authorities in response to the
pandemic.
Total noninterest income increased $138,000, or 7.8%, to $1.9
million for the quarter ended June
30, 2021 compared to $1.8
million for the quarter ended March
31, 2021, and decreased $178,000, or 8.5%, from $2.1 million for the comparable quarter in 2020.
The increase in noninterest income in the second quarter of 2021
from the first quarter of 2021 resulted primarily from an increase
in loan and lease servicing fees, and other loan fees, partially
offset by a decrease in gain on loan and lease sales. The
decrease from the comparable quarter in 2020 was primarily due to a
$461,000 decrease in gains on loan
and lease sales. Gain on sale of loans and leases declined
$395,000, or 41.0% in the second
quarter of 2021 compared to the first quarter of 2021, and
decreased $461,000, or 44.8% from the
second quarter of 2020 as mortgage banking activity declined
primarily due to lower refinancing activity and a lower level of
supply of houses for sale in the Bank's market area. Loan and
lease servicing fees increased $354,000 in the second quarter of 2021 compared
to the first quarter of 2021 as a recovery of impaired mortgage
servicing rights of $178,000 was
recorded in the second quarter of 2021 compared to an impairment of
$158,000 recorded in the first
quarter of 2021. Loan and lease servicing fees declined
$52,000 in the second quarter of 2021
compared to the same quarter in 2020 as a recovery of impaired
mortgage servicing rights of $296,000
was recorded in the second quarter of 2020. Net gains on the
sale of securities totaled $38,000 in
the quarter ended June 30, 2021,
while there were no net gains on the sale of securities recorded in
the first quarter of 2021, and net gains of $10,000 recorded in the second quarter of
2020. Card fee income increased $32,000, or 13.3% to $275,000 in the second quarter of 2021 from the
first quarter of 2021, and increased $73,000, or 36.2% from $202,000 in the second quarter of 2020.
Other loan fees increased $87,000, or
35.2%, to $335,000 in the second
quarter of 2021 compared to the quarter ended March 31, 2021, and increased $90,000, or 36.9%, over the comparable quarter in
2020. The increase in other loan fees during the current quarter
compared to the prior quarter and the first quarter of 2020 was
primarily due to an increase in commercial loan processing
fees. Commercial loan processing fees increased $25,000 in the second quarter of 2021 over the
first quarter of 2021 and increased $162,000 over the comparable quarter in
2020. Service fees on deposit accounts increased $5,000, or 2.2%, to $199,000 for the quarter ended June 30, 2021, compared to $194,000 for the first quarter of 2021, and
increased $93,000, or 88.2%, from
$106,000 for the quarter ended
June 30, 2020. The increase in
service fees on deposit accounts during the second quarter of 2021
compared to the second quarter of 2020 was primarily due to the
resumption of charging overdraft fees after the suspension of such
fees in 2020 during the height of the COVID-19 pandemic.
Total noninterest expense decreased $98,000, or 1.4%, to $6.9
million for the three months ended June 30, 2021, compared to $7.0 million for the first quarter of 2021 and
increased $1.2 million, or 21.8%,
from $5.6 million for the same period
in 2020. Salaries and employee benefits decreased $132,000, or 3.0%, to $4.3
million for the quarter ended June
30, 2021, compared to $4.4
million in the first quarter of 2021, and increased
$1.0 million, or 31.9%, from
$3.3 million for the quarter ended
June 30, 2020. The decrease in
salaries and benefits in the second quarter of 2021 from the first
quarter of 2021 primarily was due to several positions being open
and a delay in filling those positions as well as a slight decline
in both health insurance costs and unemployment compensation
insurance. The increase in salaries and benefits from the
second quarter of 2020 primarily was due to $528,000 of expenses associated with equity
awards granted during the fourth quarter of 2020 following
shareholder approval of the Company's equity incentive plan,
increased pension expense of $173,000, increased health insurance costs of
$54,000, and increased compensation
expense of $222,000 primarily as a
result of annual merit increases and additional staff. Other
expenses increased $105,000, or 13.6%
in the second quarter of 2021 compared to the prior quarter, and
increased $65,000, or 8.0%, compared
to the same quarter of 2020. The increase in other expenses from
the first quarter of 2021 primarily was due to a $78,000 increase in losses due to electronic
fraud on customers' accounts and expenses of $28,000 associated with converting our digital
banking services to a new provider.
Income tax expense increased $50,000 during the three months ended
June 30, 2021 compared to the prior
quarter due to a higher level of pre-tax income. Income tax expense
increased $7,000 during the three
months ended June 30, 2021, compared
to the same period in 2020 due to a higher level of pre-tax income,
partially offset by a lower effective tax rate. The effective
tax rate for both the second and first quarters of 2021 was 18.7%
compared to 20.2% for the second quarter a year ago.
About Richmond Mutual Bancorporation, Inc.
Richmond Mutual Bancorporation, Inc., headquartered in
Richmond, Indiana, is the holding
company for First Bank Richmond, a community-oriented financial
institution offering traditional financial and trust services
within its local communities through its eight locations in
Richmond, Centerville, Cambridge City and Shelbyville, Indiana, its five locations in
Sidney, Piqua and Troy,
Ohio and its loan production office in Columbus, Ohio.
FORWARD-LOOKING STATEMENTS:
This document and other filings by the Company with the
Securities and Exchange Commission (the "SEC"), as well as press
releases or other public or stockholder communications released by
the Company, may contain forward-looking statements, including, but
not limited to, (i) statements regarding the financial
condition, results of operations and business of the Company,
(ii) statements about the Company's plans, objectives,
expectations and intentions and other statements that are not
historical facts and (iii) other statements identified by the
words or phrases "will likely result," "are expected to," "will
continue," "is anticipated," "estimate," "project," "intends" or
similar expressions that are intended to identify "forward-looking
statements", within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are
based on current beliefs and expectations of the Company's
management and are inherently subject to significant business,
economic and competitive uncertainties and contingencies, many of
which are beyond the Company's control. In addition, these
forward-looking statements are subject to assumptions with respect
to future business strategies and decisions that are subject to
change.
The following factors, among others, could cause actual
results to differ materially from the anticipated results or other
expectations expressed in the forward-looking statements: the
effect of the COVID-19 pandemic, including on the Company's credit
quality and business operations, as well as its impact on general
economic and financial market conditions and other uncertainties
such as the extent and duration of the impact of the pandemic on
public health, the U.S. and global economies, and on consumer and
corporate customers, including economic activity, employment levels
and market liquidity: legislative changes; changes in policies by
regulatory agencies; fluctuations in interest rates; the risks of
lending and investing activities, including changes in the level
and direction of loan delinquencies and write-offs and changes in
estimates of the adequacy of the allowance for loan losses; the
Company's ability to access cost-effective funding; fluctuations in
real estate values and both residential and commercial real estate
market conditions; demand for loans and deposits in the Company's
market area; changes in management's business strategies; changes
in the regulatory and tax environments in which the Company
operates; and other factors set forth in the Company's filings with
the SEC
The factors listed above could materially affect the
Company's financial performance and could cause the Company's
actual results for future periods to differ materially from any
opinions or statements expressed with respect to future periods in
any current statements.
The Company does not undertake - and specifically declines
any obligation - to publicly release the result of any revisions
which may be made to any forward-looking statements to reflect
events or circumstances after the date of such statements or to
reflect the occurrence of anticipated or unanticipated events. When
considering forward-looking statements, keep in mind these risks
and uncertainties. Undue reliance should not be placed on any
forward-looking statement, which speaks only as of the date made.
Refer to the Company's periodic and current reports filed with the
SEC for specific risks that could cause actual results to be
significantly different from those expressed or implied by any
forward-looking statements.
Financial
Highlights (unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
SELECTED
OPERATIONS DATA:
|
June 30,
2021
|
|
March 31,
2021
|
|
June 30,
2020
|
|
June 30,
2021
|
|
June 30,
2020
|
(In thousands, except
for per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
$
|
10,847
|
|
|
$
|
10,644
|
|
|
$
|
10,498
|
|
|
$
|
21,492
|
|
|
$
|
20,950
|
|
Interest
expense
|
1,922
|
|
|
1,881
|
|
|
2,474
|
|
|
3,803
|
|
|
5,039
|
|
Net interest
income
|
8,925
|
|
|
8,763
|
|
|
8,024
|
|
|
17,689
|
|
|
15,911
|
|
|
|
|
|
|
|
|
|
|
|
Provision for loan
losses
|
530
|
|
|
400
|
|
|
1,320
|
|
|
930
|
|
|
1,530
|
|
Net interest income
after provision
|
8,395
|
|
|
8,363
|
|
|
6,704
|
|
|
16,759
|
|
|
14,381
|
|
Noninterest
income
|
1,905
|
|
|
1,767
|
|
|
2,083
|
|
|
3,671
|
|
|
3,036
|
|
Noninterest
expense
|
6,879
|
|
|
6,978
|
|
|
5,648
|
|
|
13,857
|
|
|
11,171
|
|
Income before income
tax expense
|
3,421
|
|
|
3,152
|
|
|
3,139
|
|
|
6,573
|
|
|
6,246
|
|
Income tax
provision
|
640
|
|
|
590
|
|
|
633
|
|
|
1,229
|
|
|
1,287
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
|
2,781
|
|
|
$
|
2,562
|
|
|
$
|
2,506
|
|
|
$
|
5,344
|
|
|
$
|
4,959
|
|
|
|
|
|
|
|
|
|
|
|
Shares
outstanding
|
12,685
|
|
|
13,051
|
|
|
13,527
|
|
|
12,685
|
|
|
13,527
|
|
Weighted average
shares outstanding
|
11,466
|
|
|
11,687
|
|
|
13,527
|
|
|
11,576
|
|
|
13,527
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.24
|
|
|
$
|
0.22
|
|
|
$
|
0.20
|
|
|
$
|
0.46
|
|
|
$
|
0.40
|
|
Diluted
|
$
|
0.24
|
|
|
$
|
0.22
|
|
|
$
|
0.20
|
|
|
$
|
0.45
|
|
|
$
|
0.40
|
|
SELECTED FINANCIAL
CONDITION DATA:
|
June 30,
2021
|
|
March 31,
2021
|
|
December
31,
2020
|
(In thousands, except
for per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
$
|
1,188,480
|
|
|
$
|
1,140,905
|
|
|
$
|
1,084,192
|
|
Cash and cash
equivalents
|
17,087
|
|
|
65,523
|
|
|
48,768
|
|
Investment
securities
|
339,630
|
|
|
268,370
|
|
|
256,730
|
|
Loans and leases, net
of allowance
|
785,339
|
|
|
762,842
|
|
|
734,413
|
|
Premises and
equipment, net
|
14,441
|
|
|
14,718
|
|
|
14,892
|
|
Federal Home Loan
Bank stock
|
9,050
|
|
|
9,050
|
|
|
9,050
|
|
Other
assets
|
22,933
|
|
|
20,402
|
|
|
20,339
|
|
Deposits
|
793,070
|
|
|
757,074
|
|
|
693,045
|
|
Borrowings
|
189,000
|
|
|
170,000
|
|
|
170,000
|
|
Total stockholder's
equity
|
182,569
|
|
|
189,520
|
|
|
192,713
|
|
|
|
|
|
|
|
Book value
(GAAP)
|
$
|
182,569
|
|
|
$
|
189,520
|
|
|
$
|
192,713
|
|
Tangible book value
(non-GAAP)
|
182,569
|
|
|
189,520
|
|
|
192,713
|
|
Book value per share
(GAAP)
|
14.39
|
|
|
14.52
|
|
|
14.61
|
|
Tangible book value
per share (non-GAAP)
|
14.39
|
|
|
14.52
|
|
|
14.61
|
|
The following table summarizes information relating to our loan
portfolio at the dates indicated:
(In
thousands)
|
June 30,
2021
|
|
March 31,
2021
|
|
December
31,
2020
|
|
|
|
|
|
|
Commercial
mortgage
|
$
|
249,376
|
|
|
$
|
254,561
|
|
|
$
|
247,564
|
|
Commercial and
industrial
|
117,079
|
|
|
128,126
|
|
|
122,831
|
|
Construction and
development
|
80,685
|
|
|
67,728
|
|
|
58,424
|
|
Multi-family
|
80,534
|
|
|
60,608
|
|
|
55,998
|
|
Residential
mortgage
|
129,049
|
|
|
128,058
|
|
|
125,121
|
|
Home
equity
|
6,325
|
|
|
6,104
|
|
|
5,982
|
|
Direct financing
leases
|
121,006
|
|
|
117,725
|
|
|
117,171
|
|
Consumer
|
14,676
|
|
|
13,183
|
|
|
13,257
|
|
|
|
|
|
|
|
Total loans and
leases
|
$
|
798,730
|
|
|
$
|
776,093
|
|
|
$
|
746,348
|
|
The following table summarizes information relating to changes
in deposits at the dates indicated:
(In
thousands)
|
June 30,
2021
|
|
March 31,
2021
|
|
December
31,
2020
|
|
|
|
|
|
|
Noninterest-bearing
demand
|
$
|
110,494
|
|
|
$
|
118,076
|
|
|
$
|
98,725
|
|
Interest-bearing
demand
|
155,565
|
|
|
151,364
|
|
|
141,990
|
|
Savings and money
market
|
246,542
|
|
|
231,199
|
|
|
209,861
|
|
Non-brokered time
deposits
|
238,789
|
|
|
229,755
|
|
|
219,194
|
|
Brokered time
deposits
|
41,680
|
|
|
26,680
|
|
|
23,275
|
|
|
|
|
|
|
|
Total
deposits
|
$
|
793,070
|
|
|
$
|
757,074
|
|
|
$
|
693,045
|
|
|
Three Months Ended
June 30,
|
|
2021
|
|
2020
|
|
Average Balance
Outstanding
|
|
Interest
Earned/
Paid
|
|
Yield/
Rate
|
|
Average Balance
Outstanding
|
|
Interest
Earned/
Paid
|
|
Yield/
Rate
|
|
(Dollars in
thousands)
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
Loans and leases
receivable
|
$
|
778,430
|
|
$
|
9,592
|
|
|
4.93
|
%
|
|
$
|
747,865
|
|
$
|
9,308
|
|
4.98
|
%
|
Securities
|
313,327
|
|
1,185
|
|
|
1.51
|
%
|
|
247,594
|
|
1,120
|
|
1.81
|
%
|
FHLB stock
|
9,050
|
|
64
|
|
|
2.83
|
%
|
|
9,035
|
|
58
|
|
2.57
|
%
|
Cash and cash
equivalents and other
|
22,839
|
|
6
|
|
|
0.11
|
%
|
|
54,806
|
|
11
|
|
0.08
|
%
|
Total interest-earning
assets
|
1,123,646
|
|
10,847
|
|
|
3.86
|
%
|
|
1,059,300
|
|
10,497
|
|
3.96
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Savings and money
market accounts
|
253,086
|
|
317
|
|
|
0.50
|
%
|
|
183,415
|
|
253
|
|
0.55
|
%
|
Interest-bearing
checking accounts
|
152,596
|
|
88
|
|
|
0.23
|
%
|
|
115,091
|
|
66
|
|
0.23
|
%
|
Certificate
accounts
|
270,497
|
|
816
|
|
|
1.21
|
%
|
|
303,805
|
|
1,385
|
|
1.82
|
%
|
Borrowings
|
173,077
|
|
701
|
|
|
1.62
|
%
|
|
181,824
|
|
770
|
|
1.69
|
%
|
Total interest-bearing
liabilities
|
849,256
|
|
1,922
|
|
|
0.91
|
%
|
|
784,135
|
|
2,474
|
|
1.26
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
$
|
8,925
|
|
|
|
|
|
|
$
|
8,023
|
|
|
Net earning
assets
|
$
|
274,390
|
|
|
|
|
|
$
|
275,165
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest rate
spread(1)
|
|
|
|
|
2.95
|
%
|
|
|
|
|
|
2.70
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
margin(2)
|
|
|
|
|
3.18
|
%
|
|
|
|
|
|
3.03
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
interest-earning assets to average interest-bearing
liabilities
|
132.31
|
%
|
|
|
|
|
|
135.09
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Net interest rate
spread represents the difference between the weighted average yield
earned on interest-earning assets and the weighted average rate
paid on interest-bearing liabilities.
|
(2)
|
Net interest margin
represents net interest income divided by average total
interest-earning assets.
|
|
Six Months Ended June
30,
|
|
2021
|
|
2020
|
|
Average Balance
Outstanding
|
|
Interest
Earned/
Paid
|
|
Yield/
Rate
|
|
Average Balance
Outstanding
|
|
Interest
Earned/
Paid
|
|
Yield/
Rate
|
|
(Dollars in
thousands)
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
Loans and leases
receivable
|
$
|
722,255
|
|
$
|
19,221
|
|
|
5.32
|
%
|
|
$
|
692,055
|
|
|
$
|
18,372
|
|
5.31
|
%
|
Securities
|
287,190
|
|
2,125
|
|
|
1.48
|
%
|
|
235,947
|
|
|
2,302
|
|
1.95
|
%
|
FHLB stock
|
9,050
|
|
133
|
|
|
2.94
|
%
|
|
8,479
|
|
|
139
|
|
3.28
|
%
|
Cash and cash
equivalents and other
|
27,193
|
|
13
|
|
|
0.10
|
%
|
|
43,541
|
|
|
136
|
|
0.62
|
%
|
Total interest-earning
assets
|
1,045,688
|
|
21,492
|
|
|
4.11
|
%
|
|
980,022
|
|
|
20,949
|
|
4.28
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Savings and money
market accounts
|
238,200
|
|
595
|
|
|
0.50
|
%
|
|
173,352
|
|
|
545
|
|
0.63
|
%
|
Interest-bearing
checking accounts
|
147,555
|
|
169
|
|
|
0.23
|
%
|
|
109,622
|
|
|
148
|
|
0.27
|
%
|
Certificate
accounts
|
259,694
|
|
1,644
|
|
|
1.27
|
%
|
|
291,449
|
|
|
2,836
|
|
1.95
|
%
|
Borrowings
|
171,547
|
|
1,395
|
|
|
1.63
|
%
|
|
172,945
|
|
|
1,510
|
|
1.75
|
%
|
Total interest-bearing
liabilities
|
816,996
|
|
3,803
|
|
|
0.93
|
%
|
|
747,368
|
|
|
5,039
|
|
1.35
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
$
|
17,689
|
|
|
|
|
|
|
$
|
15,910
|
|
|
Net earning
assets
|
$
|
228,692
|
|
|
|
|
|
$
|
232,654
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest rate
spread(1)
|
|
|
|
|
3.18
|
%
|
|
|
|
|
|
2.93
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
margin(2)
|
|
|
|
|
3.38
|
%
|
|
|
|
|
|
3.25
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
interest-earning assets to average interest-bearing
liabilities
|
127.99
|
%
|
|
|
|
|
|
131.13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Net interest rate
spread represents the difference between the weighted average yield
earned on interest-earning assets and the weighted average rate
paid on interest-bearing liabilities.
|
(2)
|
Net interest margin
represents net interest income divided by average total
interest-earning assets.
|
|
At and for the
Three Months Ended
|
Selected Financial
Ratios and Other Data:
|
June 30,
2021
|
|
March 31,
2021
|
|
December
31,
2020
|
|
September
30,
2020
|
|
June 30,
2020
|
Performance
ratios:
|
|
|
|
|
|
|
|
|
|
Return on average
assets (annualized)
|
0.96
|
%
|
|
0.92
|
%
|
|
0.95
|
%
|
|
0.92
|
%
|
|
0.93
|
%
|
Return on average
equity (annualized)
|
5.98
|
%
|
|
5.36
|
%
|
|
5.26
|
%
|
|
5.22
|
%
|
|
5.15
|
%
|
Yield on
interest-earning assets
|
3.86
|
%
|
|
4.18
|
%
|
|
4.17
|
%
|
|
4.07
|
%
|
|
3.96
|
%
|
Rate paid on
interest-bearing liabilities
|
0.91
|
%
|
|
0.96
|
%
|
|
1.06
|
%
|
|
1.19
|
%
|
|
1.26
|
%
|
Average interest rate
spread
|
2.95
|
%
|
|
3.22
|
%
|
|
3.11
|
%
|
|
2.88
|
%
|
|
2.70
|
%
|
Net interest margin
(annualized)(1)
|
3.18
|
%
|
|
3.44
|
%
|
|
3.38
|
%
|
|
3.18
|
%
|
|
3.03
|
%
|
Operating expense to
average total assets (annualized)
|
2.36
|
%
|
|
2.51
|
%
|
|
2.57
|
%
|
|
2.18
|
%
|
|
2.10
|
%
|
Efficiency
ratio(2)
|
63.74
|
%
|
|
66.27
|
%
|
|
62.89
|
%
|
|
58.04
|
%
|
|
55.94
|
%
|
Average
interest-earning assets to average interest-bearing
liabilities
|
132.31
|
%
|
|
129.96
|
%
|
|
134.66
|
%
|
|
134.04
|
%
|
|
135.09
|
%
|
Asset quality
ratios:
|
|
|
|
|
|
|
|
|
|
Non-performing assets
to total assets(3)
|
0.65
|
%
|
|
0.71
|
%
|
|
0.45
|
%
|
|
0.32
|
%
|
|
0.38
|
%
|
Non-performing loans
and leases to total gross loans and leases(4)
|
0.97
|
%
|
|
1.05
|
%
|
|
0.65
|
%
|
|
0.44
|
%
|
|
0.57
|
%
|
Allowance for loan
and lease losses to non-performing loans and
leases(4)
|
147.62
|
%
|
|
135.07
|
%
|
|
220.57
|
%
|
|
290.88
|
%
|
|
197.47
|
%
|
Allowance for loan
and lease losses to total loans and leases
|
1.43
|
%
|
|
1.41
|
%
|
|
1.42
|
%
|
|
1.29
|
%
|
|
1.12
|
%
|
Net charge-offs
(annualized) to average outstanding loans and leases during the
period
|
0.03
|
%
|
|
0.01
|
%
|
|
0.09
|
%
|
|
0.01
|
%
|
|
0.06
|
%
|
Capital
ratios:
|
|
|
|
|
|
|
|
|
|
Equity to total
assets at end of period
|
15.36
|
%
|
|
16.61
|
%
|
|
17.85
|
%
|
|
18.17
|
%
|
|
17.20
|
%
|
Average equity to
average assets
|
16.55
|
%
|
|
17.18
|
%
|
|
18.01
|
%
|
|
18.35
|
%
|
|
18.13
|
%
|
Common equity tier 1
capital (to risk weighted assets)(5)
|
17.81
|
%
|
|
19.52
|
%
|
|
20.64
|
%
|
|
18.89
|
%
|
|
18.98
|
%
|
Tier 1 leverage
(core) capital (to adjusted tangible
assets)(5)
|
13.68
|
%
|
|
14.19
|
%
|
|
14.28
|
%
|
|
13.87
|
%
|
|
13.43
|
%
|
Tier 1 risk-based
capital (to risk weighted assets)(5)
|
17.81
|
%
|
|
19.52
|
%
|
|
20.64
|
%
|
|
18.89
|
%
|
|
18.98
|
%
|
Total risk-based
capital (to risk weighted assets)(5)
|
19.06
|
%
|
|
20.77
|
%
|
|
21.90
|
%
|
|
20.13
|
%
|
|
20.07
|
%
|
Other
data:
|
|
|
|
|
|
|
|
|
|
Number of
full-service offices
|
12
|
|
12
|
|
12
|
|
12
|
|
12
|
Full-time equivalent
employees
|
178
|
|
175
|
|
170
|
|
170
|
|
172
|
|
|
(1)
|
Net interest income
divided by average interest-earning assets.
|
(2)
|
Total noninterest
expenses as a percentage of net interest income and total
noninterest income, excluding net securities
transactions.
|
(3)
|
Non-performing assets
consist of nonaccrual loans and leases, accruing loans and leases
more than 90 days past due and foreclosed assets.
|
(4)
|
Non-performing loans
and leases consist of nonaccrual loans and leases and accruing
loans and leases more than 90 days past due.
|
(5)
|
Capital ratios are
for First Bank Richmond.
|
View original
content:https://www.prnewswire.com/news-releases/richmond-mutual-bancorporation-inc-announces-second-quarter-2021-financial-results-301339888.html
SOURCE Richmond Mutual Bancorporation, Inc.