Equitable Financial : Announces September 2020 Quarterly Results

News Announcement	Contact: Tom Gdowski
308-382-3136
For immediate release
[e-mail]
	Date: November 2, 2020
Grand Island, Nebraska
First Quarter 2021 Highlights

• Equitable Financial Corp, parent company of Equitable Bank, reported profits of $1.1 million for the first quarter of fiscal year ending June 30, 2021, or $0.37 per share, compared to $774,000, or $0.25 per share for the first quarter of fiscal year June 2020.
• Net interest income increased $191,000, or 7% during the first quarter of fiscal year June 2021 compared to the first quarter in fiscal year June 2020. This increase is attributable to lower interest rates on deposit accounts offset by lower interest rates on loans.
• Net loans remained nearly the same ending at $342.2 million on September 30, 2020, compared to $341.7 million on June 30, 2020. With the small change in net loans a smaller amount of provision for loan losses was recorded. For the first quarter in fiscal year ending June 30, 2021 the provision for loan losses was $44,000 compared to $140,000 for the first quarter of fiscal year ending June 30, 2020.
• Noninterest income increased $835,000, or 61% to $2.2 million for the first quarter of fiscal year June 2021 compared to $1.4 million for the first quarter of fiscal year June 2020. This increase is attributable to increased volume in brokerage fee income, gain on sale of loans, PPP loan income recognized and other income.
• Noninterest expense increased $741,000, or 25% to $3.7 million for the first quarter of fiscal year June 2021 compared to $3.0 million for the first quarter of fiscal year June 2020. The primary increases were in salaries and employee benefits, data processing fees, occupancy and equipment, professional fees, and other expenses. The increase in salaries and employee benefits is attributable to a one-time increase. The other expense increase is attributable to higher loan volume resulting increased expense for loan production.
• Total assets were $402.2 million as of September 30, 2020, an increase of $7.8 million, or 2% from June 30, 2020. This increase is in interest bearing deposits because of increased deposits. Deposits increased $12.2 million, or 4% to $340.5 million on September 30 ,2020 compared to $328.3 million on June 30, 2020.

During the quarter, the company repurchased 27,631 shares of stock for a total of $308,623, at an average price per share of $11.17.

President and CEO, Tom Gdowski, stated "While dealing with the issues related to the pandemic and focusing on the health and safety of our staff members, customers and families, we are pleased to report strong financial performance in the prior quarter. Our staff continues to be flexible and open to adapting to

the new operating reality. Our technology platforms and operating systems have proven to be strong and validate the decisions and investment we have made over the prior 24 months.

As outlined above, our net operating income was strong, and we are pleased with the results. Our asset quality remained strong as we have limited exposure to industries directly impacted by the pandemic resulting in a nominal increase to our reserves. With the sudden decrease in rates and the volume of Paycheck Protection Loans the Bank originated, we did experience a decrease in our net interest margin. This could present challenges should rates remain low for an extended period of time. Our mortgage banking and investment departments continue to perform well and produce a steady stream of fee income. Overall, it was a very strong quarter, and we continue to look for trends as to the longer-term economic impact of the pandemic and its impact on our customers and economy."

About Equitable Financial Corp.

Equitable Financial Corp. is the holding company for Equitable Bank, which is a Nebraska-based community bank headquartered in Grand Island. Equitable Bank has been in operation since 1882. A full-service bank with 4 branches in Grand Island, North Platte and Omaha, Equitable offers consumer, commercial and Ag loans, home loans, checking and savings accounts, financial planning, and retirement services.

Forward-Looking Statements

When used in this Press Release, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties including, but not limited to, changes in economic conditions in the Company's market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in the Bank's market area, competition that could cause actual results to differ materially from historical earnings and those presently anticipated or projected, and other risks described in the Company's filings with the Securities and Exchange Commission. The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company advises readers that the factors listed above could 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 disclaims any obligation, to publicly release the result of any revision 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.

Equitable Financial Corp.

Balance Sheet

Unaudited

Assets		September 30, 2020			June 30, 2020
Cash and due from financial institutions	$	5,793,645	$	5,187,505
Interest-earning deposits		17,502,457			10,161,397
		23,296,102			15,348,902
Securities available-for-sale		16,846,498			18,257,878
Securities held-to-maturity		47,910			53,417
Securities at market value		29,934			-
Federal Home Loan Bank stock, at cost		1,325,300			1,317,500
Federal Reserve Bank stock, at cost		472,050			472,050
Loans, net of allowance for loan losses of $4,975,000 and $4,931,000, respectively		342,211,926			341,675,944
Premises and equipment, net		6,599,284			6,499,629
Foreclosed assets, net		4,054			35,249
Accrued interest receivable		2,828,575			2,473,808
Deferred taxes, net		444,998			440,416
Customer list intangible		1,749,276			1,792,447
Bank-owned life insurance		3,643,172			3,615,439
Other assets		2,672,663			2,406,199
Total assets	$	402,171,742	$	394,388,878
Liabilities and Stockholders' Equity
Liabilities:
Noninterest-bearing deposits	$	50,538,144	$	50,570,497
Interest-bearing deposits		289,922,977			277,720,036
		340,461,121			328,290,533
Lines of credit		-			-
Federal Home Loan Bank Borrowings		19,000,000			24,000,000
Advance payments from borrowers for taxes and insurance		345,680			596,183
Accrued interest payable and other liabilities		3,046,244			3,006,595
Total liabilities		362,853,045			355,893,311
Common stock in ESOP subject to contingent repurchase obligation		1,201,148			1,235,981
Stockholders' equity:
Common stock, $0.01 par value, 25,000,000 shares authorized 2,928,513 and 2,949,536 shares issued and
outstanding at September 30, 2020 and June 30, 2020, respectively		29,285			29,495
Additional paid-in capital		20,802,571			21,033,904
Retained earnings		19,173,023			18,095,754
Unearned ESOP shares		(726,040)			(737,944)
Shares reserved for stock compensation		(244,771)			(226,528)
Accumulated other comprehensive loss, net of tax		284,629			300,886
Reclassification of ESOP shares		(1,201,148)			(1,235,981)
Total stockholders' equity		38,117,549			37,259,586
Total liabilities and stockholders' equity	$	402,171,742	$	394,388,878

Equitable Financial Corp.

Income Statement

Unaudited

		For the three months ended
Interest income:	September 30, 2020		September 30, 2019
Loans	$	3,734,436	$	3,819,244
Securities		60,557			43,787
Other		16,749			16,160
Total interest income		3,811,742			3,879,191
Interest expense:
Deposits		784,850			1,001,448
Federal Home Loan Bank borrowings		31,479			67,637
Other		28			5,468
Total interest expense		816,357			1,074,553
Net interest income		2,995,385			2,804,638
Provision for loan losses		43,882			140,054
Net interest income after provision for loan losses		2,951,503			2,664,584
Noninterest income:
Service charges on deposit accounts		198,101			193,637
Brokerage fee income		632,675			449,521
Gain on sale of loans		887,265			336,939
Other loan fees		319,969			250,121
Other income		152,359			124,486
Total noninterest income		2,190,369			1,354,704
Noninterest expense:
Salaries and employee benefits		2,116,837			1,686,610
Director and committee fees		37,392			42,968
Data processing fees		276,084			197,398
Occupancy and equipment		328,480			305,627
Regulatory fees and deposit insurance premium		57,873			(8,000)
Advertising and public relations		91,501			99,915
Professional fees		82,581			46,739
Supplies, telephone and postage		28,508			35,411
Other expenses		706,994			578,737
Total noninterest expense		3,726,250			2,985,405
Income before income taxes		1,415,622			1,033,883
Income tax expense		(338,353)			(259,396)
Net income	$	1,077,269	$	774,487