2020 | 2020 | 2019 | |||||||
(Dollars in thousands, except per share data) | 2nd QTR | 1st QTR | 2nd QTR | ||||||
Income: | |||||||||
Net income - consolidated | $ | 5,713 | $ | 2,516 | $ | 2,022 | |||
Diluted earnings per common share | $ | 0.94 | $ | 0.39 | $ | 0.31 |
“Highlighting our second quarter results was the extraordinary production in new purchase and refinance mortgage activity, driven by historically low interest rates. At the same time, SBA Paycheck Protection Program loans generated during the quarter substantially added to loan and deposit growth, which also contributed to strong second quarter earnings,” said
“We are closely watching certain modified loans and other loans we consider at risk due to the COVID-19 induced economic slowdown. Additionally, we added
“Demonstrating the strength of our Company, we are excited to begin paying a quarterly cash dividend of
COVID-19 Pandemic Response Update
- SBA Paycheck Protection Program. As of
June 30, 2020 Meridian has assisted 928 clients in need of short-term funding by providing nearly$260 million in PPP loans. “These PPP loans helped our small business clients to support the paychecks of nearly 21,500 employees,” said Annas. “And approximately 89% of our PPP loans and 77% of small business client employees supported are based in the markets we serve inPennsylvania ,New Jersey and Delaware. The PPP loans generated$7.1 million of net loan processing fees that are being amortized into interest income over the contractual loan life.” - Industry Exposure. At the inception of the pandemic, the governor of
Pennsylvania ordered all non-essential businesses to close, mandated stay-at-home orders, closed schools and universities and put a moratorium on construction. The economic impact was widespread, but certain businesses have been more acutely impacted. Aside from construction lending, Meridian monitored commercial portfolios and identified various industries that were substantially impacted by these mandates such as retail trade, hospitality, residential spec construction and advertising/marketing. AtJune 30, 2020 , Meridian’s exposure as a percent of the total loan portfolio to these industries was 2.3%, 2.3%, 5.5%, and 1.7%, respectively. - Assistance Provided to Loan Customers. During the pandemic, Meridian also worked with commercial, construction and residential loan customers to provide assistance. In total
$117.8 million of commercial loans covering 163 borrowers and$23.9 million of construction borrowers were assisted with loan payment holidays of 3 months. In addition,$18.2 million in construction loans with interest reserves covering 33 borrowers were given lowered interest rates for an average 68 days during the moratorium. As ofJune 30, 2020 , all$18.2 million in construction loans with rate adjustments had returned to their original interest rates. On the consumer side,$6.2 million of residential mortgage and home equity loans covering 25 total borrowers were provided with 3 to 6 month payment holidays. - Loan Loss Reserve. Meridian increased its loan loss provision by
$1.6 million for the second quarter of 2020, in addition to the$1.6 million already provided for during the first quarter of 2020, in anticipation of changes in risks associated with loan classification assignments and further economic uncertainty as a result of the COVID-19 pandemic. - Technology. Starting in mid-March and continuing today, Meridian implemented limited branch hours and appointment scheduling for our customers, as well as remote working for employees. Our technology platform has allowed these functions to be seamless.
- Liquidity and Capital Management. Meridian continues to be well positioned with adequate levels of cash and liquid assets as of
June 30, 2020 . AtJune 30, 2020 , Meridian’s tangible common equity to average tangible asset ratio was 9.54% and Meridian was well in excess of regulatory requirements.
Income Statement Highlights
Second quarter 2020 compared with first quarter 2020:
- Net income was
$5.7 million , an increase of$3.2 million , or 127.0%, driven by an increase of$10.9 million in mortgage banking revenue as well as higher interest income on loans. - Pre-tax, pre-provision income for the quarter was
$9.0 million , an increase of$4.2 million or 87.3%. A reconciliation of this non-GAAP measure is included in the Appendix. - Total revenue was
$35.7 million , an increase of$11.6 million or 48%. - Net interest income increased
$1.9 million , or 20%, with interest expense down$670 thousand or 16.2%. - Non-interest income increased
$10.3 million or 99.8%, both driven by mortgage banking and SBA income.
o Mortgage banking revenue increased$10.9 million , or 137.5%, due to higher levels of originations and refi’s stemming from the historically low rate environment as well as the expansion of our mortgage division intoMaryland that took place in the first quarter of 2020.
o The increase in mortgage pipeline generated significant positive fair value changes in both derivative instruments as well as loans held-for-sale of$3.0 million , combined. These changes were more than offset by hedging losses of$3.3 million .
o SBA loan sale income increased$89 thousand . - Provision for loan losses was
$1.6 million ; approximately$1.3 million related to qualitative provisioning for economic uncertainty as a result of the COVID-19 pandemic. The first quarter 2020 provision for loan losses was nearly the same at$1.6 million . - Non-interest expenses increased
$8.1 million , or 53.0%, driven by mortgage banking related expenses. - The Board of Directors declared a quarterly cash dividend of
$0.125 per common share, payableAugust 24, 2020 , to shareholders of record as ofAugust 10, 2020 .
Balance Sheet Highlights
- Total assets increased
$429.1 million , or 37.3%, to$1.6 billion as ofJune 30, 2020 . - Total loans increased
$298.3 million , or 30.9%, to$1.3 billion as ofJune 30, 2020 . PPP loans contributed$253.6 million net to this increase. - Mortgage loans held for sale increased
$84.0 million , or 249.2%, to$117.7 million as ofJune 30, 2020 . - Mortgage segment originated
$790.5 million in loans year-to-dateJune 30, 2020 . - Total deposits grew
$315.5 million , or 37.1%, to$1.2 billion as ofJune 30, 2020 . - Non-interest bearing deposits grew
$74.9 million , or 53.7%, to$214.4 million as ofJune 30, 2020 . - Borrowings from the Federal Reserve’s Paycheck Protection Program Liquidity Facility (“PPPLF”) were
$136.2 million as ofJune 30, 2020 . - Meridian repurchased 316,625 shares of its common stock in the first quarter of 2020, at an average price of
$18.10 , fulfilling the previously announced repurchase authorization.
Select Condensed Financial Information
For the Quarter Ended (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
(Dollars in thousands, except per share data) | |||||||||||||||||||
Income: | |||||||||||||||||||
Net income - consolidated | $ | 5,713 | $ | 2,516 | $ | 3,137 | $ | 3,317 | $ | 2,022 | |||||||||
Basic earnings per common share | $ | 0.94 | $ | 0.39 | $ | 0.49 | $ | 0.52 | $ | 0.32 | |||||||||
Diluted earnings per common share | $ | 0.94 | $ | 0.39 | $ | 0.49 | $ | 0.52 | $ | 0.31 | |||||||||
Net interest income - consolidated | $ | 11,597 | $ | 9,666 | $ | 9,664 | $ | 9,274 | $ | 8,922 | |||||||||
At the Quarter Ended (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
Balance Sheet: | |||||||||||||||||||
Total assets | $ | 1,579,083 | $ | 1,303,442 | $ | 1,150,019 | $ | 1,126,937 | $ | 1,055,906 | |||||||||
Loans, net of fees and costs | 1,262,968 | 1,021,561 | 964,710 | 935,858 | 885,172 | ||||||||||||||
Total deposits | 1,166,697 | 993,753 | 851,168 | 858,461 | 840,714 | ||||||||||||||
Non-interest bearing deposits | 214,367 | 140,826 | 139,450 | 129,302 | 127,158 | ||||||||||||||
Stockholders' Equity | 125,518 | 118,033 | 120,695 | 117,772 | 114,379 | ||||||||||||||
At the Quarter Ended (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
Balance Sheet (Average Balances): | |||||||||||||||||||
Total assets | $ | 1,477,120 | $ | 1,156,682 | $ | 1,105,246 | $ | 1,059,456 | $ | 1,001,908 | |||||||||
Loans, net of fees and costs | 1,194,197 | 981,303 | 956,598 | 912,781 | 874,836 | ||||||||||||||
Total deposits | 1,155,690 | 926,741 | 859,611 | 844,568 | 836,133 | ||||||||||||||
Non-interest bearing deposits | 223,253 | 137,141 | 137,578 | 126,101 | 117,664 | ||||||||||||||
Stockholders' Equity | 119,937 | 120,469 | 119,575 | 116,547 | 113,605 | ||||||||||||||
At the Quarter Ended (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
Performance Ratios: | |||||||||||||||||||
Return on average assets - consolidated | 1.56 | % | 0.87 | % | 1.13 | % | 1.24 | % | 0.81 | % | |||||||||
Return on average equity - consolidated | 19.16 | % | 8.40 | % | 10.41 | % | 11.29 | % | 7.14 | % |
Income Statement Summary
Second Quarter 2020 Compared to First Quarter 2020
Net income was
Net interest income increased
The provision for loan losses was
Total non-interest income for the second quarter of 2020 was
Non-interest income from the sales of SBA 7(a) loans increased
Total non-interest expense for the second quarter of 2020 was
Loan expenses increased by
Second Quarter 2020 Compared to Second Quarter 2019
Net income was
Net interest income increased
The provision for loan losses of
Total non-interest income for the second quarter of 2020 was
Non-interest income from the sales of SBA loans increased
Total non-interest expense for the second quarter of 2020 was
Loan expenses increased
Balance Sheet Summary
As of
Total loans, excluding mortgage loans held-for-sale, grew
Deposits were
Consolidated stockholders’ equity of the Corporation was
Asset Quality Summary
Asset quality remains strong year-over-year. Meridian realized net charge-offs of 0.00% of total average loans for the quarter ending
About
“Safe Harbor” Statement
In addition to historical information, this press release may contain “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements with respect to Meridian Corporation’s strategies, goals, beliefs, expectations, estimates, intentions, capital raising efforts, financial condition and results of operations, future performance and business. Statements preceded by, followed by, or that include the words “may,” “could,” “should,” “pro forma,” “looking forward,” “would,” “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” or similar expressions generally indicate a forward-looking statement. These forward-looking statements involve risks and uncertainties that are subject to change based on various important factors (some of which, in whole or in part, are beyond Meridian Corporation’s control). Numerous competitive, economic, regulatory, legal and technological factors, risks and uncertainties that could cause actual results to differ materially include, without limitation, the current COVID-19 pandemic and government responses thereto, among others, could cause Meridian Corporation’s financial performance to differ materially from the goals, plans, objectives, intentions and expectations expressed in such forward-looking statements.
Contact:
Christopher J. Annas
484-568-5001
FINANCIAL TABLES FOLLOW
APPENDIX - FINANCIAL RATIOS
Quarterly | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
(Dollars in thousands, except per share data) | 2nd QTR | 1st QTR | 4th QTR | 3rd QTR | 2nd QTR | ||||||||||||||
Earnings and Per Share Data | |||||||||||||||||||
Net income | $ | 5,713 | $ | 2,516 | $ | 3,137 | $ | 3,317 | $ | 2,022 | |||||||||
Basic earnings per common share | 0.94 | 0.39 | 0.49 | 0.52 | 0.32 | ||||||||||||||
Diluted earnings per common share | 0.94 | 0.39 | 0.49 | 0.52 | 0.31 | ||||||||||||||
Common shares outstanding | 6,094 | 6,094 | 6,404 | 6,408 | 6,407 | ||||||||||||||
Performance Ratios | |||||||||||||||||||
Return on average assets - consolidated | 1.56 | % | 0.87 | % | 1.13 | % | 1.24 | % | 0.81 | % | |||||||||
Return on average equity - consolidated | 19.16 | % | 8.40 | % | 10.41 | % | 11.29 | % | 7.14 | % | |||||||||
Net interest margin (TEY) | 3.27 | % | 3.49 | % | 3.61 | % | 3.61 | % | 3.72 | % | |||||||||
Net interest margin (TEY, excluding PPP loans and borrowings) (1) | 3.41 | % | 3.49 | % | 3.61 | % | 3.61 | % | 3.72 | % | |||||||||
Yield on earning assets (TEY) | 4.24 | % | 4.98 | % | 5.18 | % | 5.29 | % | 5.44 | % | |||||||||
Yield on earning assets (TEY, excluding PPP loans) (1) | 4.50 | % | 4.98 | % | 5.18 | % | 5.29 | % | 5.44 | % | |||||||||
Cost of funds | 1.09 | % | 1.62 | % | 1.71 | % | 1.83 | % | 1.89 | % | |||||||||
Efficiency ratio | 72 | % | 76 | % | 78 | % | 74 | % | 85 | % | |||||||||
Asset Quality Ratios | |||||||||||||||||||
Net charge-offs (recoveries) to average loans | 0.00 | % | 0.00 | % | (0.03 | %) | 0.00 | % | (0.03 | %) | |||||||||
Non-performing loans/Total loans | 0.54 | % | 0.58 | % | 0.34 | % | 0.40 | % | 0.45 | % | |||||||||
Non-performing assets/Total assets | 0.47 | % | 0.51 | % | 0.30 | % | 0.36 | % | 0.40 | % | |||||||||
Allowance for loan losses/Total loans | 0.92 | % | 0.98 | % | 0.95 | % | 0.95 | % | 0.93 | % | |||||||||
Allowance for loan losses/Total loans held for investment (excluding loans at fair value and PPP loans) (1) | 1.27 | % | 1.10 | % | 1.00 | % | 1.01 | % | 0.99 | % | |||||||||
Allowance for loan losses/Non-performing loans | 170.59 | % | 168.28 | % | 281.24 | % | 236.95 | % | 208.28 | % | |||||||||
Capital Ratios | |||||||||||||||||||
Book value per common share | $ | 20.60 | $ | 19.37 | $ | 18.84 | $ | 18.38 | $ | 17.85 | |||||||||
Tangible book value per common share | $ | 19.84 | $ | 18.60 | $ | 18.09 | $ | 17.62 | $ | 17.09 | |||||||||
Total equity/Total assets | 7.95 | % | 9.06 | % | 10.50 | % | 10.45 | % | 10.83 | % | |||||||||
Tangible common equity/Tangible assets - Corporation (1) | 7.68 | % | 8.73 | % | 10.12 | % | 10.06 | % | 10.42 | % | |||||||||
Tangible common equity/Tangible assets - Bank (1) | 10.15 | % | 11.77 | % | 13.52 | % | 10.06 | % | 10.42 | % | |||||||||
Tier 1 leverage ratio - Corporation | 8.06 | % | 9.80 | % | 10.55 | % | 10.69 | % | 10.96 | % | |||||||||
Tier 1 leverage ratio - Bank | 10.71 | % | 13.22 | % | 14.08 | % | 10.69 | % | 10.96 | % | |||||||||
Common tier 1 risk-based capital ratio - Corporation | 10.24 | % | 10.12 | % | 11.21 | % | 11.25 | % | 11.37 | % | |||||||||
Common tier 1 risk-based capital ratio - Bank | 13.60 | % | 13.66 | % | 14.98 | % | 11.25 | % | 11.37 | % | |||||||||
Tier 1 risk-based capital ratio - Corporation | 10.24 | % | 10.12 | % | 11.21 | % | 11.25 | % | 11.37 | % | |||||||||
Tier 1 risk-based capital ratio - Bank | 13.60 | % | 13.66 | % | 14.98 | % | 11.25 | % | 11.37 | % | |||||||||
Total risk-based capital ratio - Corporation | 14.91 | % | 14.80 | % | 16.10 | % | 13.11 | % | 13.23 | % | |||||||||
Total risk-based capital ratio - Bank | 14.91 | % | 14.84 | % | 16.09 | % | 13.11 | % | 13.23 | % |
(1) Non-GAAP measure. See Appendix for Non-GAAP to GAAP reconciliation.
Statements of Income (Unaudited) | Statements of Income (Unaudited) | |||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Interest Income | ||||||||||||||||
Interest and fees on loans | $ | 14,457 | $ | 12,647 | $ | 27,727 | $ | 24,534 | ||||||||
Investments and cash | 598 | 426 | 1,122 | 863 | ||||||||||||
Total interest income | 15,055 | 13,073 | 28,849 | 25,397 | ||||||||||||
Interest Expense | ||||||||||||||||
Deposits | 2,575 | 3,715 | 5,829 | 6,951 | ||||||||||||
Borrowings | 883 | 436 | 1,757 | 1,048 | ||||||||||||
Total interest expense | 3,458 | 4,151 | 7,586 | 7,999 | ||||||||||||
Net interest income | 11,597 | 8,922 | 21,263 | 17,398 | ||||||||||||
Provision for loan losses | 1,631 | 14 | 3,183 | 233 | ||||||||||||
Net interest income after provision for loan losses | 9,966 | 8,908 | 18,080 | 17,165 | ||||||||||||
Non-Interest Income | ||||||||||||||||
Mortgage banking income | 18,763 | 6,321 | 26,665 | 11,229 | ||||||||||||
Wealth management income | 853 | 912 | 1,874 | 1,776 | ||||||||||||
SBA income | 658 | 515 | 1,227 | 515 | ||||||||||||
Earnings on investment in life insurance | 69 | 72 | 139 | 144 | ||||||||||||
Net change in fair value of derivative instruments | 2,364 | (32 | ) | 3,318 | (16 | ) | ||||||||||
Net change in fair value of loans held for sale | 633 | (226 | ) | 1,493 | (136 | ) | ||||||||||
Net change in fair value of loans held for investment | 143 | 90 | 81 | 414 | ||||||||||||
Loss on hedging activity | (3,301 | ) | (218 | ) | (4,726 | ) | (493 | ) | ||||||||
Gain on sale of investment securities available-for-sale | 55 | 139 | 55 | 139 | ||||||||||||
Service charges | 21 | 27 | 49 | 54 | ||||||||||||
Other | 428 | 328 | 866 | 749 | ||||||||||||
Total non-interest income | 20,686 | 7,928 | 31,041 | 14,375 | ||||||||||||
Non-Interest Expenses | ||||||||||||||||
Salaries and employee benefits | 16,198 | 8,742 | 26,082 | 16,469 | ||||||||||||
Occupancy and equipment | 1,127 | 936 | 2,051 | 1,899 | ||||||||||||
Loan expenses | 2,327 | 668 | 3,402 | 1,136 | ||||||||||||
Professional fees | 770 | 709 | 1,437 | 1,180 | ||||||||||||
Advertising and promotion | 605 | 730 | 1,214 | 1,196 | ||||||||||||
Data processing | 456 | 324 | 800 | 648 | ||||||||||||
Information technology | 388 | 319 | 706 | 585 | ||||||||||||
Communications | 187 | 162 | 317 | 354 | ||||||||||||
Other | 1,191 | 1,654 | 2,438 | 2,893 | ||||||||||||
Total non-interest expenses | 23,249 | 14,244 | 38,447 | 26,360 | ||||||||||||
Income before income taxes | 7,403 | 2,592 | 10,674 | 5,180 | ||||||||||||
Income tax expense | 1,690 | 570 | 2,445 | 1,152 | ||||||||||||
Net Income | $ | 5,713 | $ | 2,022 | $ | 8,229 | $ | 4,028 | ||||||||
Weighted-average basic shares outstanding | 6,094 | 6,407 | 6,210 | 6,407 | ||||||||||||
Basic earnings per common share | $ | 0.94 | $ | 0.32 | $ | 1.33 | $ | 0.63 | ||||||||
Adjusted weighted-average diluted shares outstanding | 6,107 | 6,436 | 6,235 | 6,436 | ||||||||||||
Diluted earnings per common share | $ | 0.94 | $ | 0.31 | $ | 1.32 | $ | 0.63 |
Statement of Condition (Unaudited) | |||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
Assets | |||||||||||||||||||
Cash & cash equivalents | $ | 46,741 | $ | 37,522 | $ | 39,371 | $ | 40,532 | $ | 30,630 | |||||||||
Investment securities | 104,712 | 99,324 | 68,645 | 61,571 | 60,816 | ||||||||||||||
Mortgage loans held for sale | 117,691 | 107,506 | 33,704 | 48,615 | 39,288 | ||||||||||||||
Loans, net of fees and costs | 1,262,968 | 1,021,561 | 964,710 | 935,858 | 885,172 | ||||||||||||||
Allowance for loan losses | (12,706 | ) | (11,098 | ) | (9,513 | ) | (9,312 | ) | (8,625 | ) | |||||||||
Bank premises and equipment, net | 8,284 | 8,410 | 8,636 | 8,929 | 9,225 | ||||||||||||||
Bank owned life insurance | 11,999 | 11,930 | 11,859 | 11,787 | 11,713 | ||||||||||||||
Other real estate owned | — | — | 120 | 120 | 120 | ||||||||||||||
4,636 | 4,704 | 4,773 | 4,841 | 4,909 | |||||||||||||||
Other assets | 34,758 | 23,583 | 27,714 | 23,996 | 22,658 | ||||||||||||||
Total Assets | $ | 1,579,083 | $ | 1,303,442 | $ | 1,150,019 | $ | 1,126,937 | $ | 1,055,906 | |||||||||
Liabilities & Stockholders’ Equity | |||||||||||||||||||
Liabilities | |||||||||||||||||||
Non-interest bearing deposits | $ | 214,367 | $ | 140,826 | $ | 139,450 | $ | 129,302 | $ | 127,158 | |||||||||
Interest bearing deposits | |||||||||||||||||||
Interest checking | 212,596 | 183,381 | 94,416 | 80,588 | 88,055 | ||||||||||||||
Money market / savings accounts | 419,886 | 362,370 | 305,473 | 327,643 | 284,666 | ||||||||||||||
Certificates of deposit | 319,848 | 307,176 | 311,829 | 320,928 | 340,835 | ||||||||||||||
Total interest bearing deposits | 952,330 | 852,927 | 711,718 | 729,159 | 713,556 | ||||||||||||||
Total deposits | 1,166,697 | 993,753 | 851,168 | 858,461 | 840,714 | ||||||||||||||
Borrowings | 232,491 | 134,730 | 126,799 | 131,588 | 83,927 | ||||||||||||||
Subordinated debt | 40,809 | 40,885 | 40,962 | 9,176 | 9,176 | ||||||||||||||
Other liabilities | 13,568 | 16,041 | 10,395 | 9,940 | 7,710 | ||||||||||||||
Total Liabilities | 1,453,565 | 1,185,409 | 1,029,324 | 1,009,165 | 941,527 | ||||||||||||||
Stockholders' Equity | 125,518 | 118,033 | 120,695 | 117,772 | 114,379 | ||||||||||||||
Total Liabilities & Stockholders’ Equity | $ | 1,579,083 | $ | 1,303,442 | $ | 1,150,019 | $ | 1,126,937 | $ | 1,055,906 |
Condensed Statements of Income (Unaudited) | |||||||||||||||
Three Months Ended | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
Interest income | $ | 15,055 | $ | 13,794 | $ | 13,877 | $ | 13,590 | $ | 13,073 | |||||
Interest expense | 3,458 | 4,128 | 4,213 | 4,316 | 4,151 | ||||||||||
Net interest income | 11,597 | 9,666 | 9,664 | 9,274 | 8,922 | ||||||||||
Provision for loan losses | 1,631 | 1,552 | (38 | ) | 705 | 14 | |||||||||
Non-interest income | 20,686 | 10,355 | 8,909 | 9,814 | 7,928 | ||||||||||
Non-interest expense | 23,249 | 15,198 | 14,507 | 14,152 | 14,244 | ||||||||||
Income before income tax expense | 7,403 | 3,271 | 4,104 | 4,231 | 2,592 | ||||||||||
Income tax expense | 1,690 | 755 | 967 | 914 | 570 | ||||||||||
Net Income | $ | 5,713 | $ | 2,516 | $ | 3,137 | $ | 3,317 | $ | 2,022 | |||||
Weighted-average basic shares outstanding | 6,094 | 6,383 | 6,407 | 6,407 | 6,407 | ||||||||||
Basic earnings per common share | $ | 0.94 | $ | 0.39 | $ | 0.49 | $ | 0.52 | $ | 0.32 | |||||
Adjusted weighted-average diluted shares outstanding | 6,107 | 6,420 | 6,443 | 6,437 | 6,436 | ||||||||||
Diluted earnings per common share | $ | 0.94 | $ | 0.39 | $ | 0.49 | $ | 0.52 | $ | 0.31 |
Segment Information | ||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||
(Dollars in thousands) | Bank | Wealth | Mortgage | Total | Bank | Wealth | Mortgage | Total | ||||||||||||
Net interest income | $ | 11,101 | (2 | ) | 498 | 11,597 | $ | 8,855 | 26 | 41 | 8,922 | |||||||||
Provision for loan losses | 1,631 | — | — | 1,631 | 14 | — | — | 14 | ||||||||||||
Net interest income after provision | 9,470 | (2 | ) | 498 | 9,966 | 8,841 | 26 | 41 | 8,908 | |||||||||||
Non-interest income | 1,399 | 867 | 18,420 | 20,686 | 1,092 | 879 | 5,957 | 7,928 | ||||||||||||
Non-interest expense | 7,592 | 788 | 14,869 | 23,249 | 7,232 | 817 | 6,195 | 14,244 | ||||||||||||
Income before income taxes | $ | 3,277 | 77 | 4,049 | 7,403 | $ | 2,701 | 88 | (197 | ) | 2,592 |
Segment Information | ||||||||||||||||||||
Six Months Ended | Six Months Ended | |||||||||||||||||||
(Dollars in thousands) | Bank | Wealth | Mortgage | Total | Bank | Wealth | Mortgage | Total | ||||||||||||
Net interest income | $ | 20,619 | (4 | ) | 648 | 21,263 | $ | 17,234 | 64 | 100 | 17,398 | |||||||||
Provision for loan losses | 3,183 | — | — | 3,183 | 233 | — | — | 233 | ||||||||||||
Net interest income after provision | 17,436 | (4 | ) | 648 | 18,080 | 17,001 | 64 | 100 | 17,165 | |||||||||||
Non-interest income | 2,449 | 1,888 | 26,704 | 31,041 | 1,543 | 1,698 | 11,134 | 14,375 | ||||||||||||
Non-interest expense | 14,557 | 1,575 | 22,315 | 38,447 | 13,397 | 1,638 | 11,325 | 26,360 | ||||||||||||
Income before income taxes | $ | 5,328 | 309 | 5,037 | 10,674 | $ | 5,147 | 124 | (91 | ) | 5,180 |
Reconciliation of Non-GAAP Financial Measures
Meridian believes that non-GAAP measures are meaningful because they reflect adjustments commonly made by management, investors, regulators and analysts to evaluate performance trends and the adequacy of common equity. This non-GAAP disclosure has limitations as an analytical tool, should not be viewed as a substitute for performance and financial condition measures determined in accordance with GAAP, and should not be considered in isolation or as a substitute for analysis of Meridian’s results as reported under GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Pre-tax, Pre-provision Reconciliation (Unaudited) | |||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||
(Dollars in thousands) | 2nd QTR | 1st QTR | 4th QTR | 3rd QTR | 2nd QTR | ||||||||||
Income before income tax expense | $ | 7,403 | 3,271 | 4,104 | 4,231 | 2,592 | |||||||||
Provision for loan losses | 1,631 | 1,552 | (38 | ) | 705 | 14 | |||||||||
Pre-tax, pre-provision income | $ | 9,034 | 4,823 | 4,066 | 4,936 | 2,606 |
Reconciliation of PPP / PPPLF Impacted Yields (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
2nd QTR | 1st QTR | 4th QTR | 3rd QTR | 2nd QTR | |||||||||||||||
Net interest margin (TEY) | 3.27 | % | 3.49 | % | 3.61 | % | 3.61 | % | 3.72 | % | |||||||||
Impact of PPP loans and PPPLF borrowings | 0.14 | % | — | — | — | — | |||||||||||||
Net interest margin (TEY, excluding PPP loans and PPPLF borrowings) | 3.41 | % | 3.49 | % | 3.61 | % | 3.61 | % | 3.72 | % | |||||||||
Yield on earning assets (TEY) | 4.24 | % | 4.98 | % | 5.18 | % | 5.29 | % | 5.44 | % | |||||||||
Impact of PPP loans | 0.26 | % | — | — | — | — | |||||||||||||
Yield on earning assets (TEY, excluding PPP loans) | 4.50 | % | 4.98 | % | 5.18 | % | 5.29 | % | 5.44 | % | |||||||||
Reconciliation of Allowance for Loan Losses / Total loans (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
2nd QTR | 1st QTR | 4th QTR | 3rd QTR | 2nd QTR | |||||||||||||||
Allowance for loan losses / Total loans | 0.92 | % | 0.98 | % | 0.95 | % | 0.95 | % | 0.93 | % | |||||||||
Less: Impact of mortgage loans held for sale | 0.09 | % | 0.10 | % | 0.03 | % | 0.05 | % | 0.04 | % | |||||||||
Less: Impact of loans held for investment - fair valued | 0.00 | % | 0.02 | % | 0.02 | % | 0.01 | % | 0.02 | % | |||||||||
Less: Impact of PPP loans | 0.26 | % | — | — | — | — | |||||||||||||
Allowance for loan losses / Total loans held for investment (excl. loans at fair value and PPP loans) | 1.27 | % | 1.10 | % | 1.00 | % | 1.01 | % | 0.99 | % |
Tangible Common Equity Ratio Reconciliation - Corporation (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
(Dollars in thousands) | 2nd QTR | 1st QTR | 4th QTR | 3rd QTR | 2nd QTR | ||||||||||||||
Total stockholders' equity | $ | 125,518 | 118,033 | 120,695 | 117,772 | 114,379 | |||||||||||||
Less: | |||||||||||||||||||
(4,636 | ) | (4,704 | ) | (4,773 | ) | (4,841 | ) | (4,909 | ) | ||||||||||
Tangible common equity | $ | 120,882 | 113,329 | 115,922 | 112,931 | 109,470 | |||||||||||||
Total assets | $ | 1,579,083 | 1,303,442 | 1,150,019 | 1,126,937 | 1,055,906 | |||||||||||||
Less: | |||||||||||||||||||
(4,636 | ) | (4,704 | ) | (4,773 | ) | (4,841 | ) | (4,909 | ) | ||||||||||
Tangible assets | $ | 1,574,447 | 1,298,738 | 1,145,246 | 1,122,096 | 1,050,997 | |||||||||||||
Tangible common equity ratio - Corporation | 7.68 | % | 8.73 | % | 10.12 | % | 10.06 | % | 10.42 | % | |||||||||
Tangible Common Equity Ratio Reconciliation - Bank (Unaudited) | |||||||||||||||||||
2020 | 2020 | 2019 | 2019 | 2019 | |||||||||||||||
(Dollars in thousands) | 2nd QTR | 1st QTR | 4th QTR | 3rd QTR | 2nd QTR | ||||||||||||||
Total stockholders' equity | $ | 164,446 | 157,544 | 159,643 | 117,772 | 114,379 | |||||||||||||
Less: | |||||||||||||||||||
(4,636 | ) | (4,704 | ) | (4,773 | ) | (4,841 | ) | (4,909 | ) | ||||||||||
Tangible common equity | $ | 159,810 | 152,840 | 154,870 | 112,931 | 109,470 | |||||||||||||
Total assets | $ | 1,579,083 | 1,303,282 | 1,149,979 | 1,126,937 | 1,055,906 | |||||||||||||
Less: | |||||||||||||||||||
(4,636 | ) | (4,704 | ) | (4,773 | ) | (4,841 | ) | (4,909 | ) | ||||||||||
Tangible assets | $ | 1,574,447 | 1,298,578 | 1,145,206 | 1,122,096 | 1,050,997 | |||||||||||||
Tangible common equity ratio - Bank | 10.15 | % | 11.77 | % | 13.52 | % | 10.06 | % | 10.42 | % |
Source:
2020 GlobeNewswire, Inc., source