Non-interest expense was $5.5 million for the three months ended June 30, 2023, compared to $5.0 million for the three months ended June 30, 2022, an increase of 8.5%. Most significantly impacting non-interest expense in the comparative three month periods was a $280,000 increase in data processing expense due primarily to recording a $238,000 breakage fee paid to Juniata’s current core service provider as Juniata plans to convert to a new core service provider in the first quarter of 2024, as well as a $209,000 increase in merger and acquisition expense during the three months ended June 30, 2023 from the completion of the Path Valley branch acquisition in the second quarter of 2023. These increases were partially offset by a $120,000 decline in amortization of investment in low-income housing partnerships due to the completion of the amortization period for one of Juniata’s low-income housing partnership investments in January 2023.
An income tax provision of $151,000 was recorded during the three months ended June 30, 2023 compared to an income tax provision of $177,000 recorded during the three months ended June 30, 2022. The federal tax credit for investments in low-income housing partnerships decreased from $226,000 in the three months ended June 30, 2022 to $82,000 in the three months ended June 30, 2023 due to the completion of the amortization period for one of Juniata’s low-income housing partnership investments.
Financial Condition
Total assets as of June 30, 2023 were $845.5 million, an increase of $14.6 million, or 1.8%, compared to total assets of $830.9 million at December 31, 2022. Comparing asset balances on June 30, 2023 and December 31, 2022, cash and cash equivalents increased by $3.6 million and total loans increased by $20.7 million, while total debt securities decreased by $8.8 million. On May 12, 2023, Juniata acquired $18.7 million in deposits from the Path Valley branch acquisition, which contributed to the $28.5 million increase in total deposits as of June 30, 2023 compared to December 31, 2022, as well as the $13.9 million decrease in short-term borrowings and repurchase agreements as the funds from the acquired deposits were used to repay Federal Home Loan Bank overnight borrowings.
Juniata maintains a strong liquidity position as of June 30, 2023, with additional borrowing capacity with the Federal Home Loan Bank of Pittsburgh of $180.5 million and $68.0 million in additional borrowing capacity of from either the Federal Reserve’s Discount Window or the Federal Reserve’s new Bank Term Funding Program (BTFP), as well as an authorized internal limit for brokered deposits of $175.0 million. Juniata had no brokered deposits outstanding as of June 30, 2023.
Subsequent Event
On July 18, 2023, the Board of Directors declared a cash dividend of $0.22 per share to shareholders of record on August 17, 2023, payable on September 1, 2023.
Management considers subsequent events occurring after the statement of condition date for matters which may require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s consolidated financial statements with the Securities and Exchange Commission. Accordingly, the financial information in this release is subject to change.
The Juniata Valley Bank, the principal subsidiary of Juniata Valley Financial Corp., is headquartered in Mifflintown, Pennsylvania, with fifteen community offices located in Juniata, Mifflin, Perry, Franklin, McKean and Potter Counties. More information regarding Juniata Valley Financial Corp. and The Juniata Valley Bank can be found online at www.JVBonline.com. Juniata Valley Financial Corp. trades through the OTCQX Best Market under the symbol JUVF.
Forward-Looking Information
*This press release may contain “forward looking” information as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect the current views of Juniata’s management with respect to, among other things, future events and Juniata’s financial performance. When words such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or similar expressions are used in this release, Juniata is making forward-looking statements. Such information is based on Juniata’s current expectations, estimates and projections about future events and financial trends affecting the financial condition of its business, many of which, by their nature, are inherently uncertain and beyond the control of Juniata. These statements are not historical facts or guarantees of future performance, events or results and are subject to risks, assumptions and uncertainties that are difficult to predict. If one or more events related to these or other risks or uncertainties materializes, or if underlying assumptions prove to be incorrect, actual results may differ materially from this forward-looking information. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and many factors could affect future financial results. Juniata undertakes no obligation to publicly update or revise forward looking information, whether because of new or updated information, future events, or otherwise. For a more complete discussion of certain risks and uncertainties affecting Juniata, please see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Forward-Looking Statements” set forth in the Juniata’s filings with the Securities and Exchange Commission.