RICHMOND, Ind., July 25,
2023 /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
$2.7 million, or $0.26 diluted earnings per share, for the second
quarter of 2023, compared to net income of $2.9 million, or $0.27 diluted earnings per share, for the first
quarter of 2023, and net income of $3.5
million, or $0.31 diluted
earnings per share, for the second quarter of 2022.
President's Comments
Garry Kleer, Chairman, President
and Chief Executive Officer, commented, "While the interest rate
increases by the Federal Reserve have impacted our net interest
income and net interest margin, we had another profitable quarter
and were able to maintain and even slightly increase our deposits.
Non-performing assets have remained stable at very acceptable
levels and we have increased our allowance for credit losses due to
the implementation of the new accounting standard for current
expected credit losses."
Second Quarter Performance Highlights:
- Assets totaled $1.4 billion both
at June 30, 2023 and March 31, 2023, and totaled $1.3 billion at December
31, 2022.
- Loans and leases, net of allowance for credit losses, totaled
$1.0 billion at June 30, 2023, compared to $989.1 million at March
31, 2023, and $961.7 million
at December 31, 2022.
- Nonperforming loans and leases totaled $8.5 million, or 0.81% of total loans and leases,
at June 30, 2023, compared to
$8.6 million, or 0.86% of total loans
and leases, at March 31, 2023, and
$9.2 million, or 0.94% at
December 31, 2022.
- The allowance for credit losses totaled $15.4 million, or 1.45% of total loans and leases
outstanding, at June 30, 2023,
compared to $15.5 million, or 1.54%
of total loans and leases outstanding, at March 31, 2023. The allowance for loan and lease
losses totaled $12.4 million, or
1.27% of total loans and leases outstanding, at December 31, 2022. On January 1, 2023, the Bank adopted the accounting
standard referred to as Current Expected Credit Loss ("CECL"),
which resulted in a one-time adjustment from equity into the
allowance for credit losses and the allowance for off-balance sheet
commitments in the amount of $3.8
million, net of tax.
- The provision for credit losses totaled $8,000 in the quarter ended June 30, 2023, compared to $170,000 in the quarter ended March 31, 2023, and $200,000 in the second quarter of 2022.
- Deposits totaled $1.0 billion at
June 30, 2023, March 31, 2023 and December 31, 2022. At June
30, 2023, noninterest-bearing deposits totaled $104.7 million, or 10.1% of total deposits,
compared to $96.8 million, or 9.4% of
total deposits at March 31, 2023, and
$106.4 million, or 10.6% of total
deposits at December 31, 2022.
- Stockholders' equity totaled $130.8
million at June 30, 2023,
compared to $136.1 million at
March 31, 2023, and $133.0 million at December
31, 2022. The Company's equity to assets ratio was 9.28% at
June 30, 2023.
- Net interest income decreased $538,000, or 5.4%, to $9.3
million for the three months ended June 30, 2023, compared to net interest income of
$9.9 million for the prior quarter,
and decreased $1.2 million or 11.5%
from $10.5 million for the comparable
quarter in 2022.
- Annualized net interest margin was 2.77% for the current
quarter, compared to 3.04% in the preceding quarter and 3.45% the
second quarter a year ago.
- The Company repurchased 237,072 shares of common stock at an
average price of $10.26 per share
during the quarter ended June 30,
2023.
- The Bank's Tier 1 capital to total assets was 10.81%, well in
excess of all regulatory requirements at June 30, 2023.
Income Statement Summary
Net interest income before the provision for credit losses
decreased $538,000, or 5.4%, to
$9.3 million in the second quarter of
2023, compared to $9.9 million in the
first quarter of 2023, and decreased $1.2
million, or 11.5%, from $10.5
million in the second quarter of 2022. The decrease from the
first quarter of 2023 was due to a 34 basis point decrease in the
average interest rate spread, partially offset by a $47.3 million increase in average interest
earning assets. The decrease from the comparable quarter in
2022 was due to a 91 basis point decrease the average interest rate
spread, partially offset by a $122.1
million increase in average interest earning assets.
Since March 2022, in response to
inflation, the Federal Open Market Committee ("FOMC") of the
Federal Reserve System has increased the target range for the
federal funds rate by 500 basis points, including 25 basis points
during the second quarter of 2023, to a range of 5.00% to 5.25%.
While net interest income benefited from the repricing impact of
the higher interest rate environment on earning asset yields, the
benefits were offset by the higher cost of interest-bearing deposit
accounts and borrowings, which tend to be shorter in duration than
our assets and re-price or reset faster than assets.
Interest income increased $1.0
million, or 6.8%, to $16.2
million during the quarter ended June
30, 2023, compared to the quarter ended March 31, 2023, and increased $3.8 million, or 30.3%, compared to the quarter
ended June 30, 2022.
Interest income on loans and leases increased $905,000, or 6.9%, to $14.1 million for the quarter ended June 30, 2023, compared to $13.2 million in the first quarter of 2023, due
to a $45.0 million increase in the
average balance of loans and leases, and an increase of 12 basis
points to 5.48% in the average yield earned on loans and leases.
Interest income on loans and leases increased $3.4 million, or 32.0%, in the second quarter of
2023 compared to the second quarter of 2022, due to an increase in
the average balance of loans and leases of $153.4 million, and an increase of 60 basis
points in the average yield earned on loans and leases.
Interest income on investment securities, excluding FHLB stock,
increased $14,000, or 0.8%, to
$1.8 million during the quarter ended
June 30, 2023, compared to the
quarter ended March 31, 2023, and
increased $154,000, or 9.3%, from the
comparable quarter in 2022. The increase in interest income on
investment securities, excluding FHLB stock, in the second quarter
of 2023 from the first quarter of 2023 was due to a two basis point
increase in the average yield earned on investment securities,
partially offset by a $871,000
decrease in the average balance. The increase in interest on
investment securities, excluding FHLB stock, in the second quarter
of 2023 from the second quarter of 2022 was due to a 41 basis point
increase in the average yield earned on investment securities,
partially offset by a $29.0 million
decrease in average balance of investment securities. Dividends on
FHLB stock increased $42,000, or
30.4%, during the quarter ended June 30,
2023 compared to the quarter ended March 31, 2023, and increased $102,000, or 130.8%, compared to the quarter
ended June 30, 2022. Interest income
on cash and cash equivalents increased $68,000, or 104.4%, during the quarter ended
June 30, 2023, compared to the
quarter ended March 31, 2022, and
increased $102,000, or 323.7%,
compared to the quarter ended June
30, 2022. The increase in interest income on cash and
cash equivalents in the second quarter of 2023 from the first
quarter of 2023 was due to a 148 basis point increase in the
average yield along with an increase of $3.1
million in the average balance. The increase in
interest income on cash and cash equivalents in the second quarter
of 2023 from the second quarter of 2022 was due to a 340 basis
point increase in the average yield, partially offset by a
$2.6 million decrease in the average
balance of cash and cash equivalents.
Interest expense increased $1.6
million, or 29.5%, to $6.9
million for the quarter ended June
30, 2023, compared to the quarter ended March 31, 2023, and increased $5.0 million, or 262.8%, compared to the quarter
ended June 30, 2022. Interest expense
on deposits increased $1.5 million,
or 37.7%, to $5.5 million for the
quarter ended June 30, 2023, compared
to the previous quarter and increased $4.3
million, or 334.9%. from the comparable quarter in 2022. The
increase from the previous quarter was primarily due to a 56 basis
points increase in the average rate paid on interest-bearing
deposits and, to a lesser extent, a $41.2
million increase in average balance of interest-bearing
deposits. The increase from the comparable quarter in 2022 was due
to an increase of $115.8 million in
average balance of, and a 173 basis point increase in the average
rate paid on, interest-bearing deposits. The average rate paid on
interest-bearing deposits was 2.35% for the quarter ended
June 30, 2023, compared to 1.79% and
0.62% for the quarters ended March 31,
2023 and June 30, 2022,
respectively.
Interest expense on FHLB borrowings increased $50,000, or 3.9%, to $1.3
million for the second quarter of 2023 compared to the
previous quarter and increased $721,000, or 115.5%, from the comparable quarter
in 2022 primarily due to increases in the average rate paid on FHLB
borrowings. The average balance of FHLB borrowings totaled
$197.1 million during the quarter
ended June 30, 2023, compared to
$198.5 million and $170.3 million for the quarters ended
March 31, 2023, and June 30, 2022, respectively. The average rate
paid on FHLB borrowings was 2.73% for the quarter ended
June 30, 2023, 2.61% for March 31, 2023, and 1.47% for the second quarter
of 2022.
Annualized net interest margin decreased to 2.77% for the second
quarter of 2023, compared to 3.04% for the first quarter of 2023
and 3.45% for the second quarter of 2022. The decrease in the net
interest margin for the second quarter of 2023 compared to the
first quarter of 2023 and the comparable quarter in 2022 was
primarily due to the rate paid on interest-bearing liabilities
increasing faster than the yield on interest-earning
assets.
The provision for credit losses totaled $8,000 for the three months ended June 30, 2023, compared to $170,000 during the quarter ended March 31, 2023 and $200,000 for the quarter ended June 30, 2022. Net charge-offs during the second
quarter of 2023 were $215,000,
compared to net recoveries of $78,000
during the first quarter of 2023 and net charge-offs of
$136,000 in the second quarter of
2022. Uncertainties relating to the level of our allowance for
credit losses remains heightened as a result of continued concern
about a potential recession due to inflation, rising interest
rates, stock market volatility and the Russia-Ukraine conflict.
Noninterest income increased $82,000, or 7.4%, to $1.2
million for the quarter ended June
30, 2023 compared to the quarter ended March 31, 2023, and increased $2,000, or 0.1%, from the comparable quarter in
2022. The increase in noninterest income in the second quarter of
2023 from the first quarter of 2023 primarily resulted from an
increase in card fee income and other income, partially offset by
decreases in service fees on deposit accounts and loan and lease
servicing fees. Card fee income increased $26,000, or 9.1%, to $313,000 for the quarter ended June 30, 2023 compared to the previous quarter,
due to higher card usage. Other income increased $74,000, or 29.6%, to $325,000 for the quarter ended June 30, 2023 as compared to the prior quarter,
due to fees earned from our participation in a loan hedging program
with a correspondent bank, along with increased wealth management
income. Service fees on deposit accounts decreased $5,000, or 1.9%, during the second quarter of
2023 as compared to the first quarter of 2023. Loan and lease
servicing fees decreased $10,000, or
8.7%, to $110,000 in the second
quarter of 2023 compared to the first quarter. The increase in
noninterest income from the comparable quarter in 2022 was due to
increases in other income, service fees on deposit accounts, and
card fee income, partially offset by decreases in loan and lease
servicing fees and net gains on loan and lease sales. Other income
increased $99,000, or 43.8%, for the
second quarter of 2023 compared to the same quarter in 2022
primarily due to fees earned from our participation in a loan
hedging program with a correspondent bank, along with increased
wealth management income. Service fees on deposit accounts
increased $27,000, or 11.0%, in the
second quarter of 2023 from the comparable quarter in 2022. Card
fee income increased $11,000, or
3.8%, in the second quarter of 2023 due to higher card usage. Net
gains on loan and lease sales decreased $68,000, or 30.5%, to $154,000 for the quarter ended June 30, 2023, compared to $222,000 for the comparable quarter in 2022 due
to increased mortgage rates causing decreased mortgage banking
activity. Loan and lease servicing fees decreased $68,000, or 38.4%, for the quarter ended
June 30, 2023 compared to the
comparable quarter in 2022 as a recovery of $76,000 was recognized in the second quarter of
2022.
Total noninterest expense decreased $25,000, or 0.3%, to $7.3
million for the three months ended June 30, 2023, compared to the first quarter of
2023, and increased $178,000, or
2.5%, compared to the same period in 2022. Salaries and employee
benefits increased $30,000, or 0.7%,
to $4.3 million for the quarter ended
June 30, 2023, compared to the first
quarter of 2023, and decreased $243,000, or 5.4%, compared to the quarter ended
June 30, 2022. The increase in
salaries and benefits in the second quarter of 2023 from the first
quarter of 2023 was primarily due to the hiring of additional staff
and increased group insurance expenses. The decrease in salaries
and benefits in the second quarter of 2023 compared to the second
quarter of 2022 was primarily due to decreased bonus
expense. Deposit insurance expense increased $24,000, or 14.3%, for the quarter ended
June 30, 2023, compared to the first
quarter of 2023 primarily due to changes in the asset and deposit
mix, and increased $111,000, or
137.0%, from the comparable quarter in 2022 also primarily due to a
change in the asset and deposit mix. Equipment expenses decreased
$65,000, or 19.7%, during the second
quarter of 2023 as compared to the prior quarter, and decreased
$57,000, or 17.7%, compared to the
comparable quarter in 2022. Data processing fees decreased
$15,000, or 1.7%, to $822,000 for the quarter ended June 30, 2023 compared to the first quarter of
2023, and increased $254,000, or
44.7%, compared to the quarter ended June
30, 2022. The increase during the second quarter of 2023 as
compared to the second quarter of 2022 was primarily due to
increased software and online services expenses. Advertising
expense decreased $10,000, or 11.2%,
in the second quarter of 2023 compared to the prior quarter due to
decreased sponsorship expenses, and decreased $26,000, or 24.6%, as compared to the second
quarter of 2022 due to decreased marketing production fees and
sponsorship expenses. Other expenses decreased $32,000, or 3.3%, in the second quarter of 2023
compared to the prior quarter, and increased $126,000, or 16.0%, compared to the same quarter
of 2022. The decrease in other expenses in the second quarter of
2023 from the first quarter of 2023 primarily was due to decreased
employee related expenses. The increase in other expenses in the
second quarter of 2023 from the comparable quarter in 2022 was
primarily due to increased commission and employee related
expenses.
Income tax expense decreased $57,000 during the three months ended
June 30, 2023 compared to the quarter
ended March 31, 2023, and decreased
$407,000 compared to the quarter
ended June 30, 2022, due to a lower level of pre-tax income
compared to the first quarter of 2023 and the second quarter of
2022. The effective tax rate for the second quarter of 2023
was 15.0% compared to 15.5% in the first quarter of 2023, and 20.2%
in the second quarter a year ago.
Balance Sheet Summary
Total assets increased $80.6
million, or 6.1%, to $1.4
billion at June 30, 2023 from
December 31, 2022. The increase was
primarily the result of an $81.3
million, or 8.5%, increase in loans and leases, net of
allowance for credit losses, to $1.0
billion at June 30, 2023,
partially offset by a decrease of $4.5
million, or 1.5%, in investment securities to $287.1 million at June 30,
2023.
The increase in loans and leases was attributable to an increase
in commercial real estate loans, direct financing leases and
multi-family loans of $43.4 million,
$18.7 million and $16.6 million, respectively. Investment
securities decreased primarily due to principal payments and
maturities.
Nonperforming loans and leases, consisting of nonaccrual loans
and leases and accruing loans and leases more than 90 days past
due, totaled $8.5 million, or 0.81%
of total loans and leases, at June 30,
2023, compared to $9.2
million, or 0.94%, at December 31,
2022. Accruing loans past due more than 90 days totaled
$2.9 million at June 30, 2023, compared to $3.2 million at December
31, 2022.
On January 1, 2023, the Bank
adopted the accounting standard referred to as the current expected
credit loss, or CECL. As a result of the change in methodology from
the incurred loss method to the CECL method, on January 1, 2023 the Company recorded a one-time
adjustment from equity into the allowance for credit losses in the
amount of $3.8 million, net of tax.
The allowance for credit losses totaled $15.4 million, or 1.45% of total loans and leases
outstanding at June 30, 2023. At
December 31, 2022, the allowance for
loan and lease losses totaled $12.4
million, or 1.27% of total loans and leases outstanding.
Additionally, as a part of the CECL adoption, the Bank established
an allowance for off-balance sheet commitments. This allowance,
which is reported in other liabilities, totaled $2.1 million at June 30,
2023. Net charge-offs during the first half of 2023 were
$137,000 compared to net charge-offs
of $127,000 during the comparable
period of 2022.
Management regularly analyzes conditions within its geographic
markets and evaluates its loan and lease portfolio. The Company
evaluated its exposure to potential credit losses as of
June 30, 2023, which evaluation
included consideration of a potential recession due to inflation,
rising interest rates, stock market volatility, and the
Russia-Ukraine conflict. Credit metrics are
being reviewed and stress testing is being performed on the loan
portfolio on an ongoing basis.
Total deposits increased $34.3
million, or 3.4%, to $1.0
billion at June 30, 2023,
compared to December 31, 2022. The
increase in deposits from December 31,
2022 primarily was due to an increase in brokered time
deposits of $33.1 million and other
time deposits of $23.6 million,
partially offset by a decrease in savings and money market accounts
of $13.0 million. Management
attributes the shift in funds to customers taking advantage of
higher rates being paid on time deposits in 2023 as a result of
interest rate hikes enacted by the Federal Reserve. Brokered time
deposits totaled $291.0 million, or
28.0% of total deposits, at June 30,
2023. Noninterest-bearing demand deposits decreased
$1.7 million to $104.7 million at June 30,
2023 compared to $106.4
million at December 31, 2022,
and totaled 10.1% of total deposits at June
30, 2023.
Stockholders' equity totaled $130.8
million at June 30, 2023, a
decrease of $2.1 million, or 1.6%,
from December 31, 2022. The decrease
in stockholders' equity at June 30,
2023 from December 31, 2022
primarily was the result of the repurchase of $3.6 million of Company common stock, the payment
of $3.0 million in dividends to
Company stockholders and the one-time adjustment to retained
earnings of $3.8 million for the
adoption of CECL during the previous quarter, partially offset by
$5.6 million in net income and a
$1.5 million reduction in accumulated
other comprehensive loss due to improvement in the fair market
value of the available for sale investment portfolio.
During the quarter ended June 30,
2023, the Company repurchased a total of 237,072 shares of
Company common stock at an average price of $10.26 per share. As of June 30, 2023, the Company had approximately
1,108,157 shares available for repurchase under its existing stock
repurchase program. Subsequent to quarter end, the Company
repurchased an additional 7,304 shares.
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. 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.
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: potential
adverse impacts to economic conditions in our local market areas,
other markets where the Company has lending relationships, or other
aspects of the Company's business operations or financial markets,
including, without limitation, as a result of employment levels,
labor shortages and the effects of inflation, a potential recession
or slowed economic growth caused by increasing political
instability from acts of war including Russia's invasion of Ukraine, as well as supply chain disruptions;
additional short-term interest rate increases by the Federal
Reserve; recessionary pressures caused by inflation and the Federal
Reserve actions to combat inflation; the impact of bank failures or
adverse developments at other banks and related negative press
about the banking industry in general on investor and depositor
sentiment; 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, including maintaining the
confidence of depositors; 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
described in the Company's latest Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q and other reports filed with or
furnished to the Securities and Exchange Commission - that are
available on our website at www.firstbankrichmond.com and on the
SEC's website at www.sec.gov.
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.
|
Financial Highlights
(unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
SELECTED OPERATIONS
DATA:
|
June 30,
2023
|
|
March 31,
2023
|
|
June 30,
2022
|
|
June 30,
2023
|
|
June 30,
2022
|
|
(In thousands, except
for per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
$
16,223
|
|
$
15,193
|
|
$
12,448
|
|
$
31,415
|
|
$
24,390
|
|
Interest
expense
|
6,890
|
|
5,322
|
|
1,899
|
|
12,211
|
|
3,788
|
|
Net interest
income
|
9,333
|
|
9,871
|
|
10,549
|
|
19,204
|
|
20,602
|
|
|
|
|
|
|
|
|
|
|
|
Provision for credit
losses(1)
|
8
|
|
170
|
|
200
|
|
178
|
|
400
|
|
Net interest income
after provision for credit losses
|
9,325
|
|
9,701
|
|
10,349
|
|
19,026
|
|
20,202
|
|
Noninterest
income
|
1,178
|
|
1,096
|
|
1,176
|
|
2,275
|
|
2,292
|
|
Noninterest
expense
|
7,336
|
|
7,361
|
|
7,158
|
|
14,698
|
|
14,491
|
|
Income before income
tax expense
|
3,167
|
|
3,436
|
|
4,367
|
|
6,603
|
|
8,003
|
|
Income tax
provision
|
475
|
|
532
|
|
882
|
|
1,007
|
|
1,500
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
2,692
|
|
$
2,904
|
|
$
3,485
|
|
$
5,596
|
|
$
6,503
|
|
|
|
|
|
|
|
|
|
|
|
Shares
outstanding
|
11,449
|
|
11,686
|
|
11,848
|
|
11,449
|
|
11,848
|
|
Average shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
10,403
|
|
10,600
|
|
10,763
|
|
10,501
|
|
10,905
|
|
Diluted
|
10,476
|
|
10,736
|
|
11,125
|
|
10,581
|
|
11,300
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
0.26
|
|
$
0.27
|
|
$
0.32
|
|
$
0.53
|
|
$
0.60
|
|
Diluted
|
$
0.26
|
|
$
0.27
|
|
$
0.31
|
|
$
0.53
|
|
$
0.58
|
|
________________________________________________
|
|
(1)
|
As a result of the
adoption of CECL on January 1, 2023, the provision for credit
losses calculated prior to that date was determined using the
previously applied incurred loss methodology rather than the
current expected credit losses methodology, and as a result the
amounts are not directly comparable.
|
|
SELECTED FINANCIAL
CONDITION DATA:
|
June 30,
2023
|
|
March 31,
2023
|
|
December 31,
2022
|
|
(In thousands, except
for per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
$
1,409,187
|
|
$
1,362,174
|
|
$
1,328,620
|
|
Cash and cash
equivalents
|
17,464
|
|
17,390
|
|
15,922
|
|
Interest-bearing time
deposits
|
490
|
|
490
|
|
490
|
|
Investment
securities
|
287,096
|
|
297,498
|
|
291,572
|
|
Loans and leases, net
of allowance for credit losses(1)
|
1,043,024
|
|
989,117
|
|
961,691
|
|
Loans held for
sale
|
340
|
|
—
|
|
474
|
|
Premises and equipment,
net
|
13,539
|
|
13,493
|
|
13,668
|
|
Federal Home Loan Bank
stock
|
10,802
|
|
10,082
|
|
9,947
|
|
Other assets
|
36,432
|
|
34,104
|
|
34,856
|
|
Deposits
|
1,039,573
|
|
1,030,034
|
|
1,005,261
|
|
Borrowings
|
226,000
|
|
183,500
|
|
180,000
|
|
Total stockholder's
equity
|
130,829
|
|
136,146
|
|
132,978
|
|
|
|
|
|
|
|
Book value
(GAAP)
|
$
130,829
|
|
$
136,146
|
|
$
132,978
|
|
Tangible book value
(non-GAAP)
|
130,829
|
|
136,146
|
|
132,978
|
|
Book value per share
(GAAP)
|
11.43
|
|
11.65
|
|
11.28
|
|
Tangible book value per
share (non-GAAP)
|
11.43
|
|
11.65
|
|
11.28
|
|
________________________________________________
|
|
(1)
|
As a result of the
adoption of CECL on January 1, 2023, the allowance amounts
calculated prior to that date were determined using the previously
applied incurred loss methodology rather than the current expected
credit losses methodology, and as a result the balances are not
directly comparable.
|
The following table summarizes information relating to our loan
and lease portfolio at the dates indicated:
|
(In
thousands)
|
June 30,
2023
|
|
March 31,
2023
|
|
December 31,
2022
|
|
|
|
|
|
|
|
Commercial
mortgage
|
$
341,475
|
|
$
321,314
|
|
$
298,087
|
|
Commercial and
industrial
|
114,162
|
|
97,880
|
|
100,420
|
|
Construction and
development
|
117,029
|
|
125,521
|
|
139,923
|
|
Multi-family
|
141,545
|
|
132,407
|
|
124,914
|
|
Residential
mortgage
|
159,753
|
|
152,376
|
|
146,129
|
|
Home equity
|
10,492
|
|
10,923
|
|
11,010
|
|
Direct financing
leases
|
152,181
|
|
143,281
|
|
133,469
|
|
Consumer
|
22,657
|
|
21,604
|
|
21,048
|
|
|
|
|
|
|
|
Total loans and
leases
|
$
1,059,294
|
|
$
1,005,306
|
|
$
975,000
|
The following table summarizes information relating to our
deposits at the dates indicated:
|
(In
thousands)
|
June 30,
2023
|
|
March 31,
2023
|
|
December 31,
2022
|
|
|
|
|
|
|
|
Noninterest-bearing
demand
|
$
104,691
|
|
$
96,827
|
|
$
106,415
|
|
Interest-bearing
demand
|
149,770
|
|
148,798
|
|
157,429
|
|
Savings and money
market
|
267,624
|
|
275,006
|
|
280,666
|
|
Non-brokered time
deposits
|
226,493
|
|
218,262
|
|
202,862
|
|
Brokered time
deposits
|
290,995
|
|
291,141
|
|
257,889
|
|
|
|
|
|
|
|
Total
deposits
|
$
1,039,573
|
|
$
1,030,034
|
|
$
1,005,261
|
Average Balances, Interest and Average Yields/Cost.
The following tables set forth for the periods indicated,
information regarding average balances of assets and liabilities as
well as the total dollar amounts of interest income from average
interest-earning assets and interest expense on average
interest-bearing liabilities, resultant yields, interest rate
spread, net interest margin (otherwise known as net yield on
interest-earning assets), and the ratio of average interest-earning
assets to average interest-bearing liabilities. Average balances
have been calculated using daily balances. Non-accruing loans have
been included in the table as loans carrying a zero yield. Loan
fees are included in interest income on loans and are not
material.
|
Three Months Ended June
30,
|
|
2023
|
|
2022
|
|
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
|
$ 1,029,162
|
|
$
14,098
|
|
5.48 %
|
|
$
875,801
|
|
$ 10,682
|
|
4.88 %
|
|
Securities
|
294,076
|
|
1,810
|
|
2.46 %
|
|
323,078
|
|
1,656
|
|
2.05 %
|
|
FHLB stock
|
10,136
|
|
180
|
|
7.10 %
|
|
9,781
|
|
78
|
|
3.19 %
|
|
Cash and cash
equivalents and other
|
12,646
|
|
135
|
|
4.24 %
|
|
15,254
|
|
32
|
|
0.84 %
|
|
Total interest-earning
assets
|
1,346,020
|
|
16,223
|
|
4.82 %
|
|
1,223,914
|
|
12,448
|
|
4.07 %
|
|
Non-earning
assets
|
43,557
|
|
|
|
|
|
41,860
|
|
|
|
|
|
Total
assets
|
1,389,577
|
|
|
|
|
|
1,265,774
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings and money
market accounts
|
288,124
|
|
1,356
|
|
1.88 %
|
|
296,224
|
|
388
|
|
0.52 %
|
|
Interest-bearing
checking accounts
|
146,396
|
|
236
|
|
0.64 %
|
|
169,618
|
|
111
|
|
0.26 %
|
|
Certificate
accounts
|
507,630
|
|
3,953
|
|
3.11 %
|
|
360,498
|
|
776
|
|
0.86 %
|
|
Borrowings
|
197,137
|
|
1,345
|
|
2.73 %
|
|
170,264
|
|
624
|
|
1.47 %
|
|
Total interest-bearing
liabilities
|
1,139,287
|
|
6,890
|
|
2.42 %
|
|
996,604
|
|
1,899
|
|
0.76 %
|
|
Noninterest-bearing
demand deposits
|
103,231
|
|
|
|
|
|
113,887
|
|
|
|
|
|
Other
liabilities
|
13,315
|
|
|
|
|
|
8,323
|
|
|
|
|
|
Stockholders'
equity
|
133,744
|
|
|
|
|
|
146,960
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
1,389,577
|
|
|
|
|
|
1,265,774
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
$
9,333
|
|
|
|
|
|
$ 10,549
|
|
|
|
Net earning
assets
|
$
206,733
|
|
|
|
|
|
$
227,310
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest rate
spread(1)
|
|
|
|
|
2.40 %
|
|
|
|
|
|
3.31 %
|
|
Net interest
margin(2)
|
|
|
|
|
2.77 %
|
|
|
|
|
|
3.45 %
|
|
Average
interest-earning assets to average interest-bearing
liabilities
|
118.15 %
|
|
|
|
|
|
122.81 %
|
|
|
|
|
|
________________________________________________
|
|
(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,
|
|
2023
|
|
2022
|
|
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
|
$ 1,006,806
|
|
$
27,291
|
|
5.42 %
|
|
$
862,940
|
|
$ 20,948
|
|
4.86 %
|
|
Securities
|
294,510
|
|
3,606
|
|
2.45 %
|
|
338,289
|
|
3,242
|
|
1.92 %
|
|
FHLB stock
|
10,087
|
|
318
|
|
6.31 %
|
|
9,844
|
|
161
|
|
3.27 %
|
|
Cash and cash
equivalents and other
|
11,114
|
|
200
|
|
3.60 %
|
|
16,970
|
|
39
|
|
0.46 %
|
|
Total interest-earning
assets
|
1,322,517
|
|
31,415
|
|
4.75 %
|
|
1,228,043
|
|
24,390
|
|
3.97 %
|
|
Non-earning
assets
|
43,909
|
|
|
|
|
|
38,818
|
|
|
|
|
|
Total
assets
|
1,366,426
|
|
|
|
|
|
1,266,861
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings and money
market accounts
|
283,840
|
|
2,353
|
|
1.66 %
|
|
280,313
|
|
725
|
|
0.52 %
|
|
Interest-bearing
checking accounts
|
149,787
|
|
425
|
|
0.57 %
|
|
167,630
|
|
208
|
|
0.25 %
|
|
Certificate
accounts
|
488,034
|
|
6,792
|
|
2.78 %
|
|
362,011
|
|
1,591
|
|
0.88 %
|
|
Borrowings
|
197,823
|
|
2,641
|
|
2.67 %
|
|
176,845
|
|
1,264
|
|
1.43 %
|
|
Total interest-bearing
liabilities
|
1,119,484
|
|
12,211
|
|
2.18 %
|
|
986,799
|
|
3,788
|
|
0.77 %
|
|
Noninterest-bearing
demand deposits
|
100,271
|
|
|
|
|
|
112,393
|
|
|
|
|
|
Other
liabilities
|
13,660
|
|
|
|
|
|
7,450
|
|
|
|
|
|
Stockholders'
equity
|
133,011
|
|
|
|
|
|
160,219
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
1,366,426
|
|
|
|
|
|
1,266,861
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
$
19,204
|
|
|
|
|
|
$ 20,602
|
|
|
|
Net earning
assets
|
$
203,033
|
|
|
|
|
|
$
241,244
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest rate
spread(1)
|
|
|
|
|
2.57 %
|
|
|
|
|
|
3.20 %
|
|
Net interest
margin(2)
|
|
|
|
|
2.90 %
|
|
|
|
|
|
3.36 %
|
|
Average
interest-earning assets to average interest-bearing
liabilities
|
118.14 %
|
|
|
|
|
|
124.45 %
|
|
|
|
|
|
________________________________________________
|
|
(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,
2023
|
|
March 31,
2023
|
|
December 31,
2022
|
|
September
30,
2022
|
|
June 30,
2022
|
|
Performance
ratios:
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (annualized)
|
0.77 %
|
|
0.86 %
|
|
1.01 %
|
|
0.99 %
|
|
1.10 %
|
|
Return on average
equity (annualized)
|
8.05 %
|
|
8.78 %
|
|
10.40 %
|
|
8.94 %
|
|
9.41 %
|
|
Yield on
interest-earning assets
|
4.82 %
|
|
4.68 %
|
|
4.52 %
|
|
4.25 %
|
|
4.07 %
|
|
Rate paid on
interest-bearing liabilities
|
2.42 %
|
|
1.94 %
|
|
1.42 %
|
|
1.04 %
|
|
0.76 %
|
|
Average interest rate
spread
|
2.40 %
|
|
2.74 %
|
|
3.10 %
|
|
3.21 %
|
|
3.31 %
|
|
Net interest margin
(annualized)(1)
|
2.77 %
|
|
3.04 %
|
|
3.33 %
|
|
3.39 %
|
|
3.45 %
|
|
Operating expense to
average total assets (annualized)
|
2.11 %
|
|
2.19 %
|
|
2.43 %
|
|
2.41 %
|
|
2.27 %
|
|
Efficiency
ratio(2)
|
69.79 %
|
|
67.12 %
|
|
66.66 %
|
|
66.03 %
|
|
61.05 %
|
|
Average
interest-earning assets to average interest-bearing
liabilities
|
118.15 %
|
|
118.13 %
|
|
118.97 %
|
|
121.68 %
|
|
122.81 %
|
|
Asset quality
ratios:
|
|
|
|
|
|
|
|
|
|
|
Non-performing assets
to total assets(3)
|
0.62 %
|
|
0.66 %
|
|
0.69 %
|
|
0.67 %
|
|
0.64 %
|
|
Non-performing loans
and leases to total gross loans and leases(4)
|
0.81 %
|
|
0.86 %
|
|
0.94 %
|
|
0.92 %
|
|
0.89 %
|
|
Allowance for credit
losses to non-performing loans and
leases(4)(5)
|
180.44 %
|
|
179.80 %
|
|
135.28 %
|
|
147.12 %
|
|
153.32 %
|
|
Allowance for credit
losses to total loans and leases(5)
|
1.45 %
|
|
1.54 %
|
|
1.27 %
|
|
1.35 %
|
|
1.37 %
|
|
Net (recoveries)
charge-offs (annualized) to
average outstanding loans and leases during the period
|
0.08 %
|
|
(0.03) %
|
|
0.06 %
|
|
0.01 %
|
|
0.06 %
|
|
Capital
ratios:
|
|
|
|
|
|
|
|
|
|
|
Equity to total assets
at end of period
|
9.28 %
|
|
9.99 %
|
|
10.01 %
|
|
9.77 %
|
|
10.93 %
|
|
Average equity to
average assets
|
9.62 %
|
|
9.85 %
|
|
9.70 %
|
|
11.04 %
|
|
11.72 %
|
|
Common equity tier 1
capital (to risk weighted assets)(6)
|
12.77 %
|
|
13.14 %
|
|
13.23 %
|
|
13.59 %
|
|
15.55 %
|
|
Tier 1 leverage (core)
capital (to adjusted tangible assets)(6)
|
10.81 %
|
|
10.95 %
|
|
11.20 %
|
|
11.29 %
|
|
12.74 %
|
|
Tier 1 risk-based
capital (to risk weighted assets)(6)
|
12.77 %
|
|
13.14 %
|
|
13.23 %
|
|
13.59 %
|
|
15.55 %
|
|
Total risk-based
capital (to risk weighted assets)(6)
|
14.02 %
|
|
14.39 %
|
|
14.31 %
|
|
14.74 %
|
|
16.72 %
|
|
Other
data:
|
|
|
|
|
|
|
|
|
|
|
Number of full-service
offices
|
12
|
|
12
|
|
12
|
|
12
|
|
12
|
|
Full-time equivalent
employees
|
183
|
|
181
|
|
181
|
|
184
|
|
177
|
|
|
|
(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.
|
|
(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)
|
As a result of the
adoption of CECL on January 1, 2023, the allowance for credit
losses calculated prior to that date was determined using the
previously applied incurred loss methodology rather than the
current expected credit losses methodology, and as a result the
balances are not directly comparable.
|
|
(6)
|
Capital ratios are for
First Bank Richmond.
|
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content:https://www.prnewswire.com/news-releases/richmond-mutual-bancorporation-inc-announces-2023-second-quarter-financial-results-301885586.html
SOURCE Richmond Mutual Bancorporation, Inc.