Timberland Bancorp, Inc. (NASDAQ: TSBK) (“Timberland” or “the
Company”) today reported net income increased 10% to $7.29 million
for the quarter ended December 31, 2020 from $6.65 million for the
comparable quarter one year ago and increased 15% from $6.36
million for the preceding quarter. Earnings per diluted common
share (“EPS”) increased 12% to $0.87 for the current quarter from
$0.78 for the comparable quarter one year ago and increased 14%
from $0.76 for the preceding quarter.
Timberland’s Board of Directors announced a $0.01 increase (5%)
in the quarterly cash dividend to shareholders to $0.21 per common
share and a special cash dividend of $0.10 per common share. Both
dividends are payable on February 26, 2021, to shareholders of
record on February 12, 2021.
“We are pleased to report record quarterly income and continued
strong financial metrics for our first fiscal quarter,” stated
Michael Sand, President and CEO. “We are encouraged the vast
majority of our borrowers are effectively managing through a
difficult economy over which COVID-19 continues to cast a
shadow. We are also encouraged by the possibility of vaccine
availability during the next several months and the potential for
hard hit individuals and businesses to begin recovering financially
from very challenging circumstances.”
“In support of businesses and their employees in our
communities, staff members have worked diligently to process and
file Paycheck Protection Program (“PPP”) applications for
forgiveness,” said Sand. During the quarter, PPP loan
balances decreased $23.4 million with nearly all forgiveness
applicants obtaining full forgiveness from the Small Business
Administration (“SBA”). We continue to actively submit
forgiveness requests in support of our clients and have begun
accepting applications from businesses seeking support from the
newly authorized round of PPP financing. This new round of
funding offers assistance to companies that did not receive PPP
funding last calendar year and also makes available additional
loans targeted at hard hit businesses that previously obtained a
PPP loan and need further assistance. We will actively
participate in this extended program in order to provide needed
support to businesses in our communities.”
“During the quarter we continued to work with COVID-19 affected
borrowers to appropriately defer loans to provide them with
economic relief. We have found the number of deferral
requests to be modest. At December 31, 2020 we had 12 loans
remaining in a deferred payment status representing approximately
1.43% of net loans outstanding. Borrowers were paying
interest monthly on 8 of these 12 deferred loans.”
First Fiscal Quarter 2021 Earnings and Balance Sheet
Highlights (at or for the period ended December 31, 2020,
compared to December 31, 2019 or September 30, 2020):
Earnings Highlights:
- Net income increased to $7.29 million for the current quarter
from $6.36 million for the preceding quarter and $6.65 million for
the comparable quarter one year ago; EPS increased to $0.87 for the
current quarter from $0.76 for the preceding quarter and $0.78 for
the comparable quarter one year ago;
- Return on average equity (“ROE”) and return on average assets
(“ROA”) for the current quarter were 15.39% and 1.84%,
respectively;
- Net interest margin was 3.48% for the current quarter compared
to 3.44% for the preceding quarter and 4.43% for the comparable
quarter one year ago; and
- The efficiency ratio improved to 47.83% from 50.73% for the
preceding quarter and 49.43% for the comparable quarter one year
ago.
Balance Sheet Highlights:
- Total assets increased 25% year-over-year and 1% from the prior
quarter;
- Total deposits increased 27% year-over-year and 1% from the
prior quarter;
- Net loans receivable increased 10% year-over-year and decreased
slightly from the prior quarter;
- Non-performing assets to total assets improved to 0.19%;
and
- Book and tangible book (non-GAAP) values per common share
increased to $23.24 and $21.24, respectively, at December 31,
2020.
Operating Results
Operating revenue (net interest income before the
provision for loan losses plus non-interest income) increased 4% to
$17.58 million for the first fiscal quarter from $16.94 million for
the comparable quarter one year ago and increased 2% from $17.24
million for the preceding quarter.
Net interest income increased 4% to $13.02 million
for the current quarter from $12.52 million for the preceding
quarter and increased slightly (less than 1%) from $13.00 million
for the comparable quarter one year
ago. Timberland’s net interest margin
(“NIM”) for the current quarter was 3.48% compared to 3.44% for the
preceding quarter and 4.43% for the comparable quarter one year
ago. The NIM for the current quarter
was increased by approximately nine basis points due to the
accretion of $120,000 of the fair value discount on loans acquired
in the South Sound Acquisition and the collection of $196,000 in
pre-payment penalties, non-accrual interest, and late fees. The NIM
for the preceding quarter was increased by approximately ten basis
points due to the accretion of $173,000 of the fair value discount
on loans acquired in the South Sound Acquisition and the collection
of $181,000 in pre-payment penalties, non-accrual interest and late
fees. The NIM for the comparable quarter one year ago was increased
by approximately 13 basis points due to the accretion of $146,000
of the fair value discount on loans acquired in the South Sound
Acquisition and the collection of $233,000 in pre-payment
penalties, non-accrual interest and late
fees. Also affecting the net interest
income comparisons are PPP loans, which have a 1.00% interest rate
and have loan origination fees, which are accreted into interest
income over the life of each loan. During the quarter ended
December 31, 2020, Timberland recorded $295,000 in interest income
on PPP loans and accreted $1.14 million in PPP loan origination
fees into income. During the quarter
ended September 30, 2020, Timberland recorded $316,000 in interest
income on PPP loans and accreted $599,000 in PPP loan origination
fees into income. At December 31,
2020, Timberland had $2.58 million in PPP deferred loan origination
fees remaining to be accreted into interest income during the
remaining life of the loans.
No provision for loan losses was made during the
current quarter compared to a $500,000 provision for loan losses
for the preceding quarter and a $200,000 provision for loan losses
for the comparable quarter one year ago.
Non-interest income increased 16% to $4.56 million
for the current quarter from $3.94 million for the comparable
quarter one year ago and decreased 3% from $4.72 million for the
preceding quarter. The decrease in non-interest income compared to
the preceding quarter was primarily due to a $147,000 decrease in
gain on sales of loans and smaller decreases in several other
categories. The decrease in gain on sales of loans was primarily
due to a decrease in the dollar amount of fixed rate one- to
four-family loans sold during the current quarter. Also affecting
non-interest income for the current quarter was a $236,000
valuation allowance on servicing rights, which was primarily due to
prepayment speeds increasing on mortgages being serviced in the
current low interest rate environment.
Total operating expenses for the current quarter
decreased 4% to $8.41 million from $8.74 million for the preceding
quarter and increased slightly (less than 1%) from $8.37 million
for the comparable quarter one year
ago. The decrease in operating
expenses compared to the preceding quarter was primarily due to a
$241,000 decrease in OREO expense, a $111,000 decrease in
professional fees and smaller decreases in several other expense
categories. These decreases were partially offset by a $175,000
increase in salaries and employee benefits and smaller increases in
several other expense categories. The decrease in OREO expense was
primarily due to a market value write-down in the preceding quarter
and expense recoveries in the current quarter. The decrease in
professional fees was primarily due to the timing of several
consulting and auditing engagements that increased expenses in the
preceding quarter. The increase in salaries and employee benefits
was primarily due to annual salary adjustments that became
effective in October 2020. The
efficiency ratio for the current quarter improved to 47.83% from
50.73% for the preceding quarter and 49.43% for the comparable
quarter one year ago.
The provision for income taxes for the current quarter increased
$248,000 to $1.88 million from $1.64 million for the preceding
quarter, primarily due to higher income before income
taxes. Timberland’s effective income tax rate was 20.5%
for both the quarter ended December 31, 2020 and the quarter ended
September 30, 2020.
Balance Sheet Management
Total assets increased $22.43 million, or 1%, to $1.59 billion
at December 31, 2020 from $1.57 billion at September 30, 2020. The
increase was primarily due to an increase in total cash and cash
equivalents, which was partially offset by a decrease in CDs held
for investment. The increase in total assets was funded primarily
by an increase in total deposits and by retained net income.
Loans
Net loans receivable decreased $6.57 million to $1.007 billion
at December 31, 2020 from $1.014 billion at September 30, 2020. The
decrease during the current quarter was primarily due to a $23.35
million decrease in PPP loan balances, and smaller decreases in
several other categories. These decreases were
partially offset by a $10.10 million increase in commercial real
estate mortgage loans, a $6.26 million decrease in the undisbursed
portion of construction loans in process and smaller changes in
several other categories.
Loan Portfolio($ in
thousands)
| |
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
| |
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
| Mortgage loans: |
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family (a) |
$ |
115,613 |
|
|
10 |
% |
|
$ |
118,580 |
|
|
10 |
% |
|
$ |
129,373 |
|
|
13 |
% |
|
Multi-family |
|
89,413 |
|
|
8 |
|
|
|
85,053 |
|
|
8 |
|
|
|
78,326 |
|
|
8 |
|
|
Commercial |
|
463,670 |
|
|
41 |
|
|
|
453,574 |
|
|
40 |
|
|
|
439,024 |
|
|
44 |
|
|
Construction - custom and |
|
|
|
|
|
|
|
|
|
|
|
|
owner/builder |
|
117,872 |
|
|
10 |
|
|
|
129,572 |
|
12 |
|
|
|
124,530 |
|
|
12 |
|
|
Construction - speculative one-to four-family |
|
20,291 |
|
|
2 |
|
|
|
14,592 |
|
|
1 |
|
|
|
18,764 |
|
|
2 |
|
|
Construction - commercial |
|
41,491 |
|
|
4 |
|
|
|
33,144 |
|
|
3 |
|
|
|
36,670 |
|
|
4 |
|
|
Construction - multi-family |
|
29,410 |
|
|
3 |
|
|
|
34,476 |
|
|
3 |
|
|
|
33,290 |
|
|
3 |
|
|
Construction - land |
|
|
|
|
|
|
|
|
|
|
|
|
development |
|
6,943 |
|
|
1 |
|
|
|
7,712 |
|
|
1 |
|
|
|
1,656 |
|
|
-- |
|
|
Land |
|
22,635 |
|
|
2 |
|
|
|
25,571 |
|
|
2 |
|
|
|
29,419 |
|
|
3 |
|
|
Total mortgage loans |
|
907,338 |
|
|
81 |
|
|
|
902,274 |
|
|
80 |
|
|
|
891,052 |
|
|
89 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Consumer loans: |
|
|
|
|
|
|
|
|
|
|
|
|
Home equity and second |
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
35,446 |
|
|
3 |
|
|
|
32,077 |
|
|
3 |
|
|
|
39,103 |
|
|
4 |
|
|
Other |
|
2,979 |
|
|
-- |
|
|
|
3,572 |
|
|
-- |
|
|
|
4,093 |
|
|
-- |
|
|
Total consumer loans |
|
38,425 |
|
|
3 |
|
|
|
35,649 |
|
|
3 |
|
|
|
43,196 |
|
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Commercial loans: |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial business loans |
|
71,257 |
|
|
7 |
|
|
|
69,540 |
|
|
6 |
|
|
|
73,790 |
|
|
7 |
|
|
SBA PPP loans |
|
103,468 |
|
|
9 |
|
|
|
126,820 |
|
|
11 |
|
|
|
-- |
|
|
-- |
|
|
Total commercial loans |
|
174,725 |
|
|
16 |
|
|
|
196,360 |
|
|
17 |
|
|
|
73,790 |
|
|
7 |
|
| Total loans |
|
1,120,488 |
|
|
100 |
% |
|
|
1,134,283 |
|
|
100 |
% |
|
|
1,008,038 |
|
|
100 |
% |
| Less: |
|
|
|
|
|
|
|
|
|
|
|
|
Undisbursed portion of |
|
|
|
|
|
|
|
|
|
|
|
|
construction loans in |
|
|
|
|
|
|
|
|
|
|
|
|
process |
|
(94,298 |
) |
|
|
|
|
(100,558 |
) |
|
|
|
|
(82,172 |
) |
|
|
|
Deferred loan origination |
|
|
|
|
|
|
|
|
|
|
|
|
fees |
|
(5,449 |
) |
|
|
|
|
(6,436 |
) |
|
|
|
|
(2,834 |
) |
|
|
|
Allowance for loan losses |
|
(13,432 |
) |
|
|
|
|
(13,414 |
) |
|
|
|
|
(9,882 |
) |
|
|
|
Total loans receivable, net |
$ |
1,007,309 |
|
|
|
|
$ |
1,013,875 |
|
|
|
|
$ |
913,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_______________________(a) Does not include
one- to four-family loans held for sale totaling $10,871, $4,509
and $5,420 at December 31, 2020, September 30, 2020 and December
31, 2019, respectively.
The following table highlights eight commercial real estate
(“CRE”) segments generally presumed to have the potential to be
more adversely affected by work at home and COVID related social
distancing practices than other segments of the loan portfolio.
CRE Portfolio Breakdown by
Collateral
($ in thousands)
|
Collateral Type |
|
Amount |
|
Percent of CRE Portfolio |
|
Percent of Total Loan Portfolio |
|
|
|
|
|
Office buildings |
|
$ |
76,817 |
|
17 |
% |
|
7 |
% |
|
|
|
|
| Medical/dental offices |
|
|
62,965 |
|
14 |
|
|
6 |
|
|
|
|
|
| Other retail buildings |
|
|
41,144 |
|
9 |
|
|
4 |
|
|
|
|
|
| Hotels/motels |
|
|
27,223 |
|
6 |
|
|
2 |
|
|
|
|
|
| Restaurants |
|
|
25,331 |
|
5 |
|
|
2 |
|
|
|
|
|
| Nursing homes |
|
|
19,088 |
|
4 |
|
|
2 |
|
|
|
|
|
| Shopping centers |
|
|
14,421 |
|
3 |
|
|
1 |
|
|
|
|
|
| Churches |
|
|
12,384 |
|
2 |
|
|
1 |
|
|
|
|
|
| Additional CRE |
|
|
184,297 |
|
40 |
|
|
16 |
|
|
|
|
|
|
Total CRE |
|
$ |
463,670 |
|
100 |
% |
|
41 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Within Timberland’s commercial business loan portfolio (non-CRE)
resides a segment of restaurant loans totaling $13.53 million in
outstanding balances at December 31, 2020. During the quarter, loan
balances attributable to this segment decreased $3.29 million from
the September 30, 2020 balance of $16.82 million. As additional
security for these loans, Timberland holds cash collateral of 25%
of the segment’s associated outstanding loan balances. Unless prior
arrangements are made, and Timberland consents, loans falling more
than four weeks delinquent are eligible for purchase from
Timberland’s portfolio in accordance with a Marketing and Servicing
Agreement in existence since March 6, 2014. As an accommodation,
Timberland has agreed to temporarily extend the purchase
requirement to 12 weeks before a purchase is required from the
portfolio.
Timberland originated $156.57 million in loans during the
quarter ended December 31, 2020, compared to $132.55 million for
the comparable quarter one year ago and $114.15 million for the
preceding quarter. Timberland continues to sell fixed-rate one- to
four-family mortgage loans into the secondary market for
asset-liability management purposes and to generate non-interest
income. Timberland also periodically sells the guaranteed portion
of SBA loans. During the current quarter, fixed-rate one- to
four-family mortgage loans totaling $43.84 million were sold
compared to $34.56 million for the comparable quarter one year ago
and $46.85 million for the preceding quarter.
Timberland’s
investment securities and CDs held for investment decreased $11.45
million, or 8%, to $140.87 million at December 31, 2020, from
$152.32 million at September 30, 2020. The decrease was primarily
due to CDs maturing during the quarter and was partially offset by
the purchase of additional mortgage-backed investment
securities.
Timberland’s liquidity continues to remain strong. Liquidity, as
measured by the sum of cash and cash equivalents, CDs held for
investment, and available for sale investment securities, was 33.4%
of total liabilities at December 31, 2020, compared to 31.8% at
September 30, 2020, and 21.3% one year ago.
Deposits
Total deposits increased $16.71 million, or 1%, during the
current quarter to $1.38 billion at December 31, 2020, from $1.36
billion at September 30, 2020. The quarter’s increase consisted of
a $10.26 million increase in NOW checking account balances, a
$10.09 million increase in money market account balances, and a
$7.09 million increase in savings account balances. These increases
were partially offset by a $6.79 million decrease in certificates
of deposit account balances and a $3.94 million decrease in
non-interest-bearing demand account balances.
|
Deposit Breakdown($ in thousands) |
| |
|
|
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
| |
|
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Non-interest-bearing demand |
|
|
$437,953 |
|
32% |
|
|
$441,889 |
|
32% |
|
|
$297,676 |
|
27% |
|
|
NOW checking |
|
|
|
387,158 |
|
28 |
|
|
|
376,899 |
|
28 |
|
|
|
303,493 |
|
28 |
|
| Savings |
|
|
|
226,955 |
|
16 |
|
|
|
219,869 |
|
16 |
|
|
|
175,610 |
|
16 |
|
| Money market |
|
|
|
158,928 |
|
12 |
|
|
|
149,922 |
|
11 |
|
|
|
134,131 |
|
13 |
|
| Money market – reciprocal |
|
|
|
12,389 |
|
1 |
|
|
|
11,303 |
|
1 |
|
|
|
8,159 |
|
1 |
|
| Certificates of deposit under
$250 |
|
|
|
124,789 |
|
9 |
|
|
|
129,579 |
|
10 |
|
|
|
133,271 |
|
12 |
|
| Certificates of deposit $250 and
over |
|
|
|
26,944 |
|
2 |
|
|
|
28,945 |
|
2 |
|
|
|
28,933 |
|
3 |
|
| Certificates of deposit –
brokered |
|
|
|
-- |
|
-- |
|
|
|
-- |
|
-- |
|
|
|
3,204 |
|
-- |
|
|
Total deposits |
|
|
$1,375,116 |
|
100% |
|
|
$1,358,406 |
|
100% |
|
|
$1,084,477 |
|
100% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders’ Equity and Capital
Ratios
Total shareholders’ equity increased $5.70 million to $193.33
million at December 31, 2020, from $187.63 million at September 30,
2020. The increase in shareholders’ equity was primarily due to net
income of $7.29 million for the quarter, which was partially offset
by the payment of $1.66 million in dividends to shareholders and
the repurchase of 2,900 shares of the Company’s common stock for
$58,000 (an average price of $20.04 per share). Timberland had
141,952 shares available to be repurchased under the existing stock
repurchase plan at December 31, 2020.
Timberland remains well capitalized with a total
risk-based capital ratio of 21.48% and a Tier 1 leverage capital
ratio of 11.36% at December 31, 2020.
Asset Quality and Loan
Deferrals
Timberland’s non-performing assets to total assets
ratio improved to 0.19% at December 31, 2020 from 0.39% one year
ago and 0.27% at September 30, 2020. There were net recoveries of
$18,000 for the current quarter compared to net recoveries of
$20,000 for the preceding quarter and net charge-offs of $8,000 for
the comparable quarter one year ago.
No provision for loan losses was made during the current quarter
compared to a $500,000 provision for the preceding quarter and a
$200,000 provision for loan losses for the comparable quarter one
year ago.
Timberland continues to work with borrowers
affected by the COVID-19 pandemic with loan deferral and
forbearance plans. As of June 30,
2020, Timberland had granted deferrals (primarily 90-day payment
deferrals with interest continuing to accrue or be paid monthly)
for loans with balances aggregating to $135.83 million (13.4% of
net loans receivable). However, the vast majority of borrowers that
were granted deferrals have resumed making regular payments and as
of December 31, 2020, only 12 loans with balances totaling $14.39
million (1.4% of net loans receivable) remained on deferral status.
The following table details the COVID-19 loan modifications still
on deferral status as of December 31, 2020:
COVID-19 Loan
Modifications
($ in thousands)
|
Industry / Collateral Type |
|
Amount |
|
Percent ofNet Loans Receivable |
|
Hotel |
|
$ |
7,086 |
|
0.70% |
|
| Industrial warehouse |
|
|
2,631 |
|
0.26 |
|
| Restaurant |
|
|
1,964 |
|
0.20 |
|
| Construction – commercial
(hotel) |
|
|
1,439 |
|
0.14 |
|
| Church |
|
|
1,067 |
|
0.11 |
|
| Entertainment facility |
|
|
184 |
|
0.02 |
|
| Other consumer |
|
|
18 |
|
-- |
|
|
Total loan modifications |
|
$ |
14,389 |
|
1.43% |
|
| |
|
|
|
|
|
|
The allowance for loan losses (“ALL”) as a
percentage of loans receivable increased to 1.32% at December 31,
2020 from 1.07% one year ago and 1.31% at September 30, 2020. If
PPP loans, which are 100% SBA guaranteed, are excluded, the ALL to
loans receivable (excluding PPP loans) at December 31, 2020 was
1.46% (non-GAAP).
The ALL as a percentage of loans receivable is also
impacted by the loans acquired in the South Sound Acquisition.
Included in the recorded value of loans acquired in acquisitions
are net discounts which may reduce the need for an allowance for
loan losses on such loans because they are carried at an amount
below their outstanding principal balance. The initial recorded
value of loans acquired in the South Sound Acquisition was $123.62
million and the related fair value discount was $2.08 million, or
1.68% of the loans acquired. The remaining fair value discount on
loans acquired in the South Sound Acquisition was $669,000 at
December 31, 2020. The allowance for loan losses to loans
receivable (excluding PPP loan balances and the remaining aggregate
balance of the loans acquired in the South Sound Acquisition) was
1.56% (non-GAAP) at December 31, 2020.
The following table details the ALL as a percentage
of loans receivable:
| |
|
Dec. 31, |
|
Sept. 30, |
|
Dec. 31, |
| |
|
2020 |
|
|
2020 |
|
|
2019 |
|
| ALL to loans receivable |
|
1.32 |
% |
|
1.31 |
% |
|
1.07 |
% |
| ALL to loans receivable
(excluding PPP loans) (non-GAAP) |
|
1.46 |
% |
|
1.49 |
% |
|
1.07 |
% |
| ALL to loans receivable
(excluding PPP loans and South Sound Acquisition loans)
(non-GAAP) |
|
1.56 |
% |
|
1.60 |
% |
|
1.18 |
% |
Total delinquent loans (past due 30 days or more)
and non-accrual loans decreased $1.05 million, or 27%, to $2.82
million at December 31, 2020, from $3.87 million one year ago, and
decreased $926,000, or 25%, from $3.75 million at September 30,
2020. Non-accrual loans decreased
$489,000, or 16%, to $2.58 million at December 31, 2020 from $3.07
million one year ago and decreased $324,000, or 11%, from $2.91
million at September 30, 2020.
Non-Accrual Loans($ in
thousands)
| |
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
| |
Amount |
|
Quantity |
|
Amount |
|
Quantity |
|
Amount |
|
Quantity |
| Mortgage loans: |
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family |
$ |
419 |
|
2 |
|
$ |
659 |
|
3 |
|
$ |
942 |
|
4 |
|
Commercial |
|
643 |
|
3 |
|
|
858 |
|
4 |
|
|
736 |
|
3 |
|
Land |
|
405 |
|
4 |
|
|
394 |
|
3 |
|
|
198 |
|
2 |
|
Total mortgage loans |
|
1,467 |
|
9 |
|
|
1,911 |
|
10 |
|
|
1,876 |
|
9 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Consumer loans |
|
|
|
|
|
|
|
|
|
|
|
|
Home equity and second |
|
|
|
|
|
|
|
|
|
|
|
|
mortgage |
|
607 |
|
7 |
|
|
555 |
|
6 |
|
|
581 |
|
6 |
|
Other |
|
9 |
|
1 |
|
|
9 |
|
1 |
|
|
12 |
|
1 |
|
Total consumer loans |
|
616 |
|
8 |
|
|
564 |
|
7 |
|
|
593 |
|
7 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Commercial business loans |
|
498 |
|
8 |
|
|
430 |
|
6 |
|
|
601 |
|
9 |
|
Total loans |
$ |
2,581 |
|
25 |
|
$ |
2,905 |
|
23 |
|
$ |
3,070 |
|
25 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OREO and other repossessed assets decreased 84% to
$268,000 at December 31, 2020, from $1.66 million at December 31,
2019, and decreased 74% from $1.05 million at September 30, 2020.
At December 31, 2020, the OREO and other repossessed asset
portfolio consisted of four individual land parcels. During the
quarter ended December 31, 2020, two OREO properties were sold,
resulting in a $21,000 gain.
OREO and Other Repossessed
Assets($ in thousands)
| |
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
| |
Amount |
|
Quantity |
|
Amount |
|
Quantity |
|
Amount |
|
Quantity |
|
Land |
$ |
268 |
|
4 |
|
$ |
1,050 |
|
6 |
|
$ |
1,659 |
|
11 |
| Total |
$ |
268 |
|
4 |
|
$ |
1,050 |
|
6 |
|
$ |
1,659 |
|
11 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of South Sound BankOn
October 1, 2018, the Company completed the acquisition of South
Sound Bank, a Washington-state chartered bank, headquartered in
Olympia, Washington (“South Sound Acquisition”). The Company
acquired 100% of the outstanding common stock of South Sound Bank,
and South Sound Bank was merged into Timberland Bank and the
Company. Pursuant to the terms of the merger agreement, South Sound
Bank shareholders received 0.746 of a share of the Company’s common
stock and $5.68825 in cash per share of South Sound Bank common
stock. The Company issued 904,826 shares of its common stock
(valued at $28,267,000 based on the Company’s closing stock price
on September 30, 2018 of $31.24 per share) and paid $6,903,000 in
cash in the transaction for total consideration paid of
$35,170,000.
About Timberland Bancorp, Inc. Timberland
Bancorp, Inc., a Washington corporation, is the holding company for
Timberland Bank (“Bank”). The Bank opened for business in 1915 and
serves consumers and businesses across Grays Harbor, Thurston,
Pierce, King, Kitsap and Lewis counties, Washington with a full
range of lending and deposit services through its 24 branches
(including its main office in Hoquiam).
DisclaimerCertain matters discussed in this
press release may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These statements relate to our financial condition, results of
operations, plan, objectives, future performance or business.
Forward-looking statements are not statements of historical fact,
are based on certain assumptions and often include the words
“believes,” “expects,” “anticipates,” “estimates,” “forecasts,”
“intends,” “plans,” “targets,” “potentially,” “probably,”
“projects,” “outlook” or similar expressions or future or
conditional verbs such as “may,” “will,” “should,” “would” and
“could.” Forward-looking statements include statements with respect
to our beliefs, plans, objectives, goals, expectations, assumptions
and statements about future economic performance. These
forward-looking statements are subject to known and unknown risks,
uncertainties and other factors that could cause our actual results
to differ materially from the results anticipated or implied by our
forward-looking statements, including, but not limited to: the
effect of the novel coronavirus of 2019 (“COVID-19”) pandemic,
including the Company’s credit quality and business operations, as
well as its impact on general economic and financial market
conditions and other uncertainties resulting from the COVID-19
pandemic, such as the extent and duration of the impact on public
health, the U.S. and global economies, and consumer and corporate
customers, including economic activity, employment levels and
market liquidity; the credit risks of lending activities, including
changes in the level and trend of loan delinquencies and write-offs
and changes in our allowance for loan losses and provision for loan
losses that may be impacted by deterioration in the housing and
commercial real estate markets which may lead to increased losses
and non-performing assets in our loan portfolio, and may result in
our allowance for loan losses not being adequate to cover actual
losses, and require us to materially increase our loan loss
reserves; changes in general economic conditions, either nationally
or in our market areas; changes in the levels of general interest
rates, and the relative differences between short and long term
interest rates, deposit interest rates, our net interest margin and
funding sources; uncertainty regarding the future of the London
Interbank Offered Rate (“LIBOR”), and the potential transition away
from LIBOR toward new interest rate benchmarks; fluctuations in the
demand for loans, the number of unsold homes, land and other
properties and fluctuations in real estate values in our market
areas; secondary market conditions for loans and our ability to
sell loans in the secondary market; results of examinations of us
by the Federal Reserve and our bank subsidiary by the Federal
Deposit Insurance Corporation, the Washington State Department of
Financial Institutions, Division of Banks or other regulatory
authorities, including the possibility that any such regulatory
authority may, among other things, institute a formal or informal
enforcement action against us or our bank subsidiary which could
require us to increase our allowance for loan losses, write-down
assets, change our regulatory capital position or affect our
ability to borrow funds or maintain or increase deposits or impose
additional requirements or restrictions on us, any of which could
adversely affect our liquidity and earnings; legislative or
regulatory changes that adversely affect our business including
changes in regulatory policies and principles, or the
interpretation of regulatory capital or other rules including as a
result of Basel III; the impact of the Dodd Frank Wall Street
Reform and Consumer Protection Act and implementing regulations;
our ability to attract and retain deposits; our ability to control
operating costs and expenses; the use of estimates in determining
fair value of certain of our assets, which estimates may prove to
be incorrect and result in significant declines in valuation;
difficulties in reducing risk associated with the loans on our
consolidated balance sheet; staffing fluctuations in response to
product demand or the implementation of corporate strategies that
affect our work force and potential associated charges;
disruptions, security breaches, or other adverse events, failures
or interruptions in, or attacks on, our information technology
systems or on the third-party vendors who perform several of our
critical processing functions; our ability to retain key members of
our senior management team; costs and effects of litigation,
including settlements and judgments; our ability to implement our
business strategies; our ability to manage loan delinquency rates;
increased competitive pressures among financial services companies;
changes in consumer spending, borrowing and savings habits; the
availability of resources to address changes in laws, rules, or
regulations or to respond to regulatory actions; our ability to pay
dividends on our common and stock; adverse changes in the
securities markets; inability of key third-party providers to
perform their obligations to us; changes in accounting policies and
practices, as may be adopted by the financial institution
regulatory agencies or the Financial Accounting Standards Board
(“FASB”), including additional guidance and interpretation on
accounting issues and details of the implementation of new
accounting methods; the economic impact of war or any terrorist
activities; other economic, competitive, governmental, regulatory,
and technological factors affecting our operations; pricing,
products and services including the Coronavirus Aid, Relief, and
Economic Security Act of 2020 (“CARES Act”) and the Consolidated
Appropriations Act, 2021 (“CAA”); and other risks detailed in our
reports filed with the Securities and Exchange Commission.
Any of the forward-looking statements that we make in this press
release and in the other public statements we make are based upon
management’s beliefs and assumptions at the time they are made. We
do not undertake and specifically disclaim any obligation to
publicly update or revise any forward-looking statements included
in this report to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such
statements or to update the reasons why actual results could differ
from those contained in such statements, whether as a result of new
information, future events or otherwise. In light of these risks,
uncertainties and assumptions, the forward-looking statements
discussed in this document might not occur and we caution readers
not to place undue reliance on any forward-looking statements.
These risks could cause our actual results for fiscal 2021 and
beyond to differ materially from those expressed in any
forward-looking statements by, or on behalf of us, and could
negatively affect the Company’s consolidated financial condition
and results of operations as well as its stock price
performance.
| TIMBERLAND
BANCORP INC. AND SUBSIDIARYCONSOLIDATED STATEMENTS
OF INCOME |
|
Three Months Ended |
| ($ in thousands,
except per share amounts) |
|
Dec. 31, |
|
Sept. 30, |
|
Dec. 31, |
| (unaudited) |
|
|
2020 |
|
|
|
2020 |
|
|
|
2019 |
|
| |
Interest and dividend
income |
|
|
|
|
|
|
| |
Loans receivable |
|
$13,318 |
|
|
$12,884 |
|
|
$12,764 |
|
|
|
Investment securities |
|
|
301 |
|
|
|
305 |
|
|
|
439 |
|
| |
Dividends from mutual funds, FHLB
stock and other investments |
|
|
28 |
|
|
|
33 |
|
|
|
37 |
|
| |
Interest bearing deposits in
banks |
|
|
310 |
|
|
|
371 |
|
|
|
951 |
|
| |
Total interest and dividend income |
|
|
13,957 |
|
|
|
13,593 |
|
|
|
14,191 |
|
| |
|
|
|
|
|
|
|
| |
Interest
expense |
|
|
|
|
|
|
| |
Deposits |
|
|
904 |
|
|
|
1,044 |
|
|
|
1,189 |
|
| |
Borrowings |
|
|
29 |
|
|
|
29 |
|
|
|
-- |
|
| |
Total interest expense |
|
|
933 |
|
|
|
1,073 |
|
|
|
1,189 |
|
| |
Net interest income |
|
|
13,024 |
|
|
|
12,520 |
|
|
|
13,002 |
|
| |
Provision for loan
losses |
|
|
-- |
|
|
|
500 |
|
|
|
200 |
|
| |
Net interest income after provision for loan
losses |
|
|
13,024 |
|
|
|
12,020 |
|
|
|
12,802 |
|
| |
|
|
|
|
|
|
|
| |
Non-interest
income |
|
|
|
|
|
|
| |
Service charges on deposits |
|
|
1,055 |
|
|
|
1,011 |
|
|
|
1,200 |
|
| |
ATM and debit card interchange
transaction fees |
|
|
1,156 |
|
|
|
1,200 |
|
|
|
1,094 |
|
| |
Gain on sales of loans, net |
|
|
2,002 |
|
|
|
2,149 |
|
|
|
953 |
|
| |
Bank owned life insurance
(“BOLI”) net earnings |
|
|
149 |
|
|
|
149 |
|
|
|
147 |
|
| |
Servicing income on loans
sold |
|
|
15 |
|
|
|
22 |
|
|
|
74 |
|
| |
Valuation allowance on servicing
rights, net |
|
|
(236) |
|
|
|
(197) |
|
|
|
(23) |
|
| |
Recoveries on investment
securities, net |
|
|
5 |
|
|
|
7 |
|
|
|
103 |
|
| |
Other |
|
|
413 |
|
|
|
374 |
|
|
|
390 |
|
| |
Total non-interest income, net |
|
|
4,559 |
|
|
|
4,715 |
|
|
|
3,938 |
|
| |
|
|
|
|
|
|
|
| |
Non-interest
expense |
|
|
|
|
|
|
| |
Salaries and employee
benefits |
|
|
4,613 |
|
|
|
4,438 |
|
|
|
4,722 |
|
| |
Premises and equipment |
|
|
957 |
|
|
|
1,048 |
|
|
|
894 |
|
| |
Gain on disposition of premises
and equipment, net |
|
|
-- |
|
|
|
-- |
|
|
|
(99) |
|
| |
Advertising |
|
|
156 |
|
|
|
138 |
|
|
|
183 |
|
| |
OREO and other repossessed
assets, net |
|
|
(26) |
|
|
|
215 |
|
|
|
(1) |
|
| |
ATM and debit card
processing |
|
|
431 |
|
|
|
425 |
|
|
|
440 |
|
| |
Postage and courier |
|
|
138 |
|
|
|
152 |
|
|
|
135 |
|
| |
State and local taxes |
|
|
283 |
|
|
|
293 |
|
|
|
216 |
|
| |
Professional fees |
|
|
231 |
|
|
|
342 |
|
|
|
269 |
|
| |
FDIC insurance expense
(credit) |
|
|
96 |
|
|
|
88 |
|
|
|
(27) |
|
| |
Loan administration and
foreclosure |
|
|
80 |
|
|
|
89 |
|
|
|
89 |
|
| |
Data processing and
telecommunications |
|
|
606 |
|
|
|
583 |
|
|
|
584 |
|
| |
Deposit operations |
|
|
284 |
|
|
|
278 |
|
|
|
317 |
|
| |
Amortization of core deposit
intangible (“CDI”) |
|
|
90 |
|
|
|
102 |
|
|
|
101 |
|
| |
Other, net |
|
|
471 |
|
|
|
552 |
|
|
|
550 |
|
| |
Total non-interest expense, net |
|
|
8,410 |
|
|
|
8,743 |
|
|
|
8,373 |
|
| |
|
|
|
|
|
|
|
| |
Income before income
taxes |
|
|
9,173 |
|
|
|
7,992 |
|
|
|
8,367 |
|
| |
Provision for income
taxes |
|
|
1,883 |
|
|
|
1,635 |
|
|
|
1,715 |
|
| |
Net income |
|
$7,290 |
|
|
$6,357 |
|
|
$6,652 |
|
| |
|
|
|
|
|
|
|
| |
Net income per common
share: |
|
|
|
|
|
|
| |
Basic |
|
$0.88 |
|
|
$0.76 |
|
|
$0.80 |
|
| |
Diluted |
|
|
0.87 |
|
|
|
0.76 |
|
|
|
0.78 |
|
| |
|
|
|
|
|
|
|
| |
Weighted average common
shares outstanding: |
|
|
|
|
|
|
| |
Basic |
|
|
8,313,493 |
|
|
|
8,310,793 |
|
|
|
8,341,470 |
|
| |
Diluted |
|
|
8,412,744 |
|
|
|
8,379,170 |
|
|
|
8,475,029 |
|
| TIMBERLAND
BANCORP INC. AND SUBSIDIARYCONSOLIDATED BALANCE
SHEETS |
|
| ($ in thousands,
except per share amounts) (unaudited) |
|
Dec. 31, |
|
Sept. 30, |
|
Dec. 31, |
| |
|
|
2020 |
|
|
|
2020 |
|
|
|
2019 |
|
|
Assets |
|
|
|
|
|
|
| Cash and due from
financial institutions |
|
$24,226 |
|
|
$21,877 |
|
|
$24,322 |
|
| Interest-bearing
deposits in banks |
|
|
325,987 |
|
|
|
292,575 |
|
|
|
94,529 |
|
|
|
Total cash and cash equivalents |
|
|
350,213 |
|
|
|
314,452 |
|
|
|
118,851 |
|
| |
|
|
|
|
|
|
|
| Certificates of
deposit (“CDs”) held for investment, at cost |
|
|
49,629 |
|
|
|
65,545 |
|
|
|
76,249 |
|
| Investment
securities: |
|
|
|
|
|
|
| |
Held to maturity, at amortized
cost |
|
|
24,509 |
|
|
|
27,890 |
|
|
|
39,080 |
|
| |
Available for sale, at fair
value |
|
|
65,762 |
|
|
|
57,907 |
|
|
|
37,873 |
|
| Investments in equity
securities, at fair value |
|
|
974 |
|
|
|
977 |
|
|
|
953 |
|
| FHLB stock |
|
|
1,922 |
|
|
|
1,922 |
|
|
|
1,437 |
|
| Other investments, at
cost |
|
|
3,000 |
|
|
|
3,000 |
|
|
|
3,000 |
|
| Loans held for
sale |
|
|
10,871 |
|
|
|
4,509 |
|
|
|
5,420 |
|
| |
|
|
|
|
|
|
| Loans receivable |
|
|
1,020,741 |
|
|
|
1,027,289 |
|
|
|
923,032 |
|
| Less: Allowance for
loan losses |
|
|
(13,432) |
|
|
|
(13,414) |
|
|
|
(9,882) |
|
| |
Net loans receivable |
|
|
1,007,309 |
|
|
|
1,013,875 |
|
|
|
913,150 |
|
| |
|
|
|
|
|
|
|
| Premises and
equipment, net |
|
|
22,753 |
|
|
|
23,035 |
|
|
|
22,588 |
|
| OREO and other
repossessed assets, net |
|
|
268 |
|
|
|
1,050 |
|
|
|
1,659 |
|
| BOLI |
|
|
21,745 |
|
|
|
21,596 |
|
|
|
21,152 |
|
| Accrued interest
receivable |
|
|
4,490 |
|
|
|
4,484 |
|
|
|
3,665 |
|
| Goodwill |
|
|
15,131 |
|
|
|
15,131 |
|
|
|
15,131 |
|
| CDI |
|
|
1,535 |
|
|
|
1,625 |
|
|
|
1,930 |
|
| Servicing rights,
net |
|
|
3,036 |
|
|
|
3,095 |
|
|
|
2,599 |
|
| Operating lease
right-of-use assets |
|
|
2,512 |
|
|
|
2,587 |
|
|
|
2,823 |
|
| Other assets |
|
|
2,746 |
|
|
|
3,298 |
|
|
|
2,982 |
|
| |
Total
assets |
|
$1,588,405 |
|
|
$1,565,978 |
|
|
$1,270,542 |
|
| |
|
|
|
|
|
|
|
|
Liabilities and shareholders’ equity |
|
|
|
|
|
|
| Deposits:
Non-interest-bearing demand |
|
$437,953 |
|
|
$441,889 |
|
|
$297,676 |
|
| Deposits:
Interest-bearing |
|
|
937,163 |
|
|
|
916,517 |
|
|
|
786,801 |
|
| |
Total deposits |
|
|
1,375,116 |
|
|
|
1,358,406 |
|
|
|
1,084,477 |
|
| |
|
|
|
|
|
|
|
| Operating lease
liabilities |
|
|
2,565 |
|
|
|
2,630 |
|
|
|
2,823 |
|
| FHLB borrowings |
|
|
10,000 |
|
|
|
10,000 |
|
|
|
-- |
|
| Other liabilities and
accrued expenses |
|
|
7,399 |
|
|
|
7,312 |
|
|
|
7,589 |
|
| |
Total
liabilities |
|
|
1,395,080 |
|
|
|
1,378,348 |
|
|
|
1,094,889 |
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
|
|
|
|
|
Common stock, $.01 par value; 50,000,000 shares
authorized;
8,317,793 shares issued and outstanding – December 31,
2020
8,310,793 shares issued and outstanding – September 30, 2020
8,346,394 shares issued and outstanding – December 31, 2019 |
|
|
42,480 |
|
|
|
42,396 |
|
|
|
43,246 |
|
| Retained
earnings |
|
|
150,801 |
|
|
|
145,173 |
|
|
|
132,553 |
|
| Accumulated other
comprehensive income (loss) |
|
|
44 |
|
|
|
61 |
|
|
|
(146) |
|
| |
Total shareholders’
equity |
|
|
193,325 |
|
|
|
187,630 |
|
|
|
175,653 |
|
| |
Total liabilities and
shareholders’ equity |
|
$1,588,405 |
|
|
$1,565,978 |
|
|
$1,270,542 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| KEY FINANCIAL RATIOS AND
DATA |
|
Three Months Ended |
| ($ in thousands, except per share
amounts) (unaudited) |
|
Dec. 31, |
|
Sept. 30, |
|
Dec. 31, |
|
|
|
|
2020 |
|
|
|
2020 |
|
|
|
2019 |
|
| PERFORMANCE
RATIOS: |
|
|
|
|
|
|
| Return on average assets (a) |
|
|
1.84% |
|
|
|
1.65% |
|
|
|
2.12% |
|
| Return on average equity (a) |
|
|
15.39% |
|
|
|
13.78% |
|
|
|
15.40% |
|
| Net interest margin (a) |
|
|
3.48% |
|
|
|
3.44% |
|
|
|
4.43% |
|
| Efficiency ratio |
|
|
47.83% |
|
|
|
50.73% |
|
|
|
49.43% |
|
| |
|
|
|
|
|
|
|
ASSET QUALITY RATIOS AND DATA: |
|
|
|
|
|
|
| Non-accrual loans |
|
$2,581 |
|
|
$2,905 |
|
|
$3,070 |
|
| Loans past due 90 days and still
accruing |
|
|
-- |
|
|
|
-- |
|
|
|
-- |
|
| Non-performing investment
securities |
|
|
205 |
|
|
|
209 |
|
|
|
254 |
|
| OREO and other repossessed
assets |
|
|
268 |
|
|
|
1,050 |
|
|
|
1,659 |
|
| Total non-performing assets
(b) |
|
$3,054 |
|
|
$4,164 |
|
|
$4,983 |
|
| |
|
|
|
|
|
|
| Non-performing assets to total
assets (b) |
|
|
0.19% |
|
|
|
0.27% |
|
|
|
0.39% |
|
| Net charge-offs (recoveries)
during quarter |
|
$ (18) |
|
|
$ (20) |
|
|
$ 8 |
|
| ALL to non-accrual loans |
|
|
520% |
|
|
|
462% |
|
|
|
322% |
|
| ALL to loans receivable (c) |
|
|
1.32% |
|
|
|
1.31% |
|
|
|
1.07% |
|
| ALL to loans receivable
(excluding PPP loans) (d) (non-GAAP) |
|
|
1.46% |
|
|
|
1.49% |
|
|
|
1.07% |
|
| ALL to loans receivable
(excluding PPP loans and South Sound Acquisition loans) (d) (e)
(non-GAAP) |
|
|
1.56% |
|
|
|
1.60% |
|
|
|
1.18% |
|
| Troubled debt restructured loans
on accrual status (f) |
|
$2,868 |
|
|
$2,868 |
|
|
$2,894 |
|
|
|
|
|
|
|
|
|
|
CAPITAL RATIOS: |
|
|
|
|
|
|
| Tier 1 leverage capital |
|
|
11.36% |
|
|
|
11.26% |
|
|
|
12.91% |
|
| Tier 1 risk-based capital |
|
|
20.23% |
|
|
|
20.08% |
|
|
|
18.31% |
|
| Common equity Tier 1 risk-based
capital |
|
|
20.23% |
|
|
|
20.08% |
|
|
|
18.31% |
|
|
Total risk-based capital |
|
|
21.48% |
|
|
|
21.34% |
|
|
|
19.47% |
|
| Tangible common equity to
tangible assets (non-GAAP) |
|
|
11.24% |
|
|
|
11.03% |
|
|
|
12.65% |
|
| |
|
|
|
|
|
|
|
BOOK VALUES: |
|
|
|
|
|
|
| Book value per common share |
|
$23.24 |
|
|
$22.58 |
|
|
$21.05 |
|
| Tangible book value per common
share (g) |
|
|
21.24 |
|
|
|
20.56 |
|
|
|
19.00 |
|
________________________________________________
(a) Annualized(b) Non-performing assets include
non-accrual loans, loans past due 90 days and still accruing,
non-performing investment securities and OREO and other repossessed
assets. Troubled debt restructured loans on accrual status are not
included. (c) Does not include loans held for sale and is before
the allowance for loan losses.(d) Does not include PPP loans
totaling $103,468, $126,820 and $0 at December 31, 2020, September
30, 2020 and December 31, 2019, respectively.(e) Does not include
loans acquired in the South Sound Acquisition totaling $56,874,
$63,721 and $85,365 at December 31, 2020, September 30, 2020 and
December 31, 2019, respectively.(f) Does not include troubled debt
restructured loans totaling $197, $203 and $354 reported as
non-accrual loans at December 31, 2020, September 30, 2020 and
December 31, 2019 respectively. (g) Tangible common equity divided
by common shares outstanding
(non-GAAP). AVERAGE
BALANCES, YIELDS, AND RATES - QUARTERLY ($ in
thousands)(unaudited)
| |
For the Three Months Ended |
| |
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
| |
Amount |
Rate |
|
Amount |
Rate |
|
Amount |
|
Rate |
| |
|
|
|
|
|
|
|
|
|
| Assets |
|
|
|
|
|
|
|
|
|
|
Loans receivable and loans held for sale |
$ |
1,030,289 |
|
5.17 |
% |
|
$ |
1,031,689 |
|
5.00 |
% |
|
$ |
911,905 |
|
|
5.60 |
% |
| Investment securities and FHLB
stock (1) |
|
94,033 |
|
1.40 |
|
|
|
84,756 |
|
1.59 |
|
|
|
65,949 |
|
|
2.89 |
|
| Interest-earning deposits in
banks and CDs |
|
374,376 |
|
0.33 |
|
|
|
339,224 |
|
0.44 |
|
|
|
196,322 |
|
|
1.93 |
|
|
Total interest-earning assets |
|
1,498,698 |
|
3.73 |
|
|
|
1,455,669 |
|
3.74 |
|
|
|
1,174,176 |
|
|
4.83 |
|
| Other assets |
|
84,077 |
|
|
|
|
87,140 |
|
|
|
|
83,405 |
|
|
|
|
Total assets |
$ |
1,582,775 |
|
|
|
$ |
1,542,809 |
|
|
|
$ |
1,257,581 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
| NOW checking accounts |
$ |
377,760 |
|
0.19 |
% |
|
$ |
360,622 |
|
0.23 |
% |
|
$ |
296,402 |
|
|
0.30 |
% |
| Money market accounts |
|
168,503 |
|
0.33 |
|
|
|
159,951 |
|
0.38 |
|
|
|
133,755 |
|
|
0.56 |
|
| Savings accounts |
|
222,866 |
|
0.08 |
|
|
|
214,080 |
|
0.09 |
|
|
|
174,590 |
|
|
0.08 |
|
| Certificates of deposit
accounts |
|
155,125 |
|
1.38 |
|
|
|
161,674 |
|
1.55 |
|
|
|
166,799 |
|
|
1.78 |
|
|
Total interest-bearing deposits |
|
924,254 |
|
0.39 |
|
|
|
896,327 |
|
0.47 |
|
|
|
771,546 |
|
|
0.61 |
|
| Borrowings |
|
10,000 |
|
1.15 |
|
|
|
10,000 |
|
1.15 |
|
|
|
-- |
|
|
-- |
|
|
Total interest-bearing liabilities |
|
934,254 |
|
0.40 |
|
|
|
906,327 |
|
0.47 |
|
|
|
771,546 |
|
|
0.61 |
|
| |
|
|
|
|
|
|
|
|
|
| Non-interest-bearing demand
deposits |
|
448,350 |
|
|
|
|
440,950 |
|
|
|
|
305,452 |
|
|
|
| Other liabilities |
|
10,687 |
|
|
|
|
10,966 |
|
|
|
|
7,825 |
|
|
|
| Shareholders’ equity |
|
189,484 |
|
|
|
|
184,566 |
|
|
|
|
172,758 |
|
|
|
|
Total liabilities and shareholders’ equity |
$ |
1,582,775 |
|
|
|
$ |
1,542,809 |
|
|
|
$ |
1,257,581 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
|
3.33 |
% |
|
|
3.27 |
% |
|
|
|
4.22 |
% |
|
Net interest margin (2) |
|
3.48 |
% |
|
|
3.44 |
% |
|
|
|
4.43 |
% |
|
Average interest-earning assets to |
|
|
|
|
|
|
|
|
|
|
average interest-bearing liabilities |
|
160.42 |
% |
|
|
|
160.61 |
% |
|
|
|
152.18 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_____________________________________(1) Includes other
investments(2) Net interest margin = annualized net interest income
/ average interest-earning assets
Non-GAAP Financial MeasuresIn addition to
results presented in accordance with generally accepted accounting
principles (“GAAP”), this press release contains certain non-GAAP
financial measures. Timberland believes that certain non-GAAP
financial measures provide investors with information useful in
understanding the Company’s financial performance; however, readers
of this report are urged to review these non-GAAP financial
measures in conjunction with GAAP results as reported.
Financial measures that exclude intangible assets are non-GAAP
measures. To provide investors with a broader understanding of
capital adequacy, Timberland provides non-GAAP financial measures
for tangible common equity, along with the GAAP measure. Tangible
common equity is calculated as shareholders’ equity less goodwill
and CDI. In addition, tangible assets equal total assets less
goodwill and CDI.
The following table provides a reconciliation of ending
shareholders’ equity (GAAP) to ending tangible shareholders’ equity
(non-GAAP) and ending total assets (GAAP) to ending tangible assets
(non-GAAP).
| ($ in thousands) |
|
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
| |
|
|
|
|
|
|
|
Shareholders’ equity |
|
$ |
193,325 |
|
|
$ |
187,630 |
|
|
$ |
175,653 |
|
| Less goodwill and CDI |
|
|
(16,666 |
) |
|
|
(16,756 |
) |
|
|
(17,061 |
) |
| Tangible common equity |
|
$ |
176,659 |
|
|
$ |
170,874 |
|
|
$ |
158,592 |
|
| |
|
|
|
|
|
|
| Total assets |
|
$ |
1,588,405 |
|
|
$ |
1,565,978 |
|
|
$ |
1,270,542 |
|
| Less goodwill and CDI |
|
|
(16,666 |
) |
|
|
(16,756 |
) |
|
|
(17,061 |
) |
| Tangible assets |
|
$ |
1,571,739 |
|
|
$ |
1,549,222 |
|
|
$ |
1,253,481 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Contact: Michael R. Sand,President &
CEODean J. Brydon, CFO
(360)
533-4747www.timberlandbank.com
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