Kish Bancorp : Announces Third Quarter Financial Results

Kish Bancorp, Inc. Announces Third Quarter Financial Results

STATE COLLEGE, PA (KISB) - October 16, 2023 - William P. Hayes, Executive Chairman of Kish Bancorp, Inc., has announced unaudited financial results for the nine-month period ending September 30, 2023. Highlights for the first nine months of 2023 include:

• Strong expansion in net income year-to-date of 10.7% over the first nine months of 2022
• Significant rise in net interest income after provision for credit losses of $4.7 million, or 16.9%
• Sustained strong loan growth of $168.9 million, or 17.1%
• Growth in total assets of $189.4 million year over year, or 14.7%, to $1.474 billion
• Healthy internal capital formation of 13.9%, supported by higher retained earnings
• Continued strong ROE of 13.36% and ROA of 0.95%
• Low loan charge-offs and healthy credit quality metrics that remain at positive levels

Kish Bancorp's total assets ended the period at $1.474 billion, an increase of $189.4 million, or 14.74%, compared to total assets of $1.285 billion a year ago. Total loans outstanding grew year over year by $168.9 million, or 17.09%, to $1.157 billion, with continued strong activity by the Bank's central PA and northeastern Ohio lending teams. Investment securities increased to $186.1 million, a $13.6 million increase from the same period in 2022 at progressively higher rates of return. Total deposits grew by $80.8 million to $1.124 billion, an increase of 7.74% from $1.043 billion a year ago.

"The opening of our first Altoona branch in July has contributed to a sustained acceleration in retail and commercial deposit expansion," said Hayes.

Net income for the nine months of 2023 was $10.02 million, an increase of $969 thousand, or 10.71%, compared to $9.05 million for the same period in 2022. Total net interest income after credit loss provision rose $4.65 million year over year, an increase of 16.90%, continuing to reflect an expanding net interest margin. A small increase of $136 thousand in the credit loss provision reflected continued strong loan quality and contributed to positive results for the first nine months of 2023. The expansion in net interest income also benefitted from the increase in interest rates and Kish Bank's success in controlling its cost of funds in concert with the overall rise in market rates.

Noninterest income for the nine-month period decreased 3.71% compared to the same period in 2022, which was mainly attributable to a loss of $404 thousand on equity securities and lower gains on sale of residential mortgage loans of $255 thousand. When these categories are removed, noninterest income increased by 11.05%, reflecting strong results by Kish's nonbanking business units. Year-over-year increases in Kish Insurance commissions of $146 thousand and Kish Travel revenue of $33 thousand supported this increase.

Noninterest expense increased year over year by $3.09 million, or 12.04%, to $28.71 million, compared to $25.62 million the year prior. Hayes stated, "In part, this increase reflects higher data processing fees associated with a strong expansion in new customer numbers, as well as the strategic investment in the training and education of our employees. Team expansion remains as a lead to salary expense, coupled

with the inflationary pressures on compensation expense." Data Processing as a line item was higher due to a reclassification of expenses that in 2022 were included in Occupancy-all other expense categories were well-controlled when compared to the prior year.

Return on shareholders' equity remained strong at 13.36%, compared to 14.51% for the same period in 2022. The Board of Directors declared a quarterly dividend in the amount of $0.37 per share, payable October 31, 2023, to shareholders of record as of October 16, 2023. Notably, 2023 marked the eighth consecutive year of dividend increases for Kish Bancorp, as a $0.02 (or 5.7%) increase was declared in the second quarter.

In September, Kish Bancorp announced a private stock offering to raise additional capital. Hayes noted that The Company's total assets have grown by $500 million in less than four years, and net income has grown by 14.5% per year on average over the last 10 years.

"Additional capital will be used to support continued profitable expansion of the franchise, much of which is already in the pipeline. The use of a private offering provides the most cost-effective method of adding to the Company's permanent capital," said Hayes. "Although the offering is limited to accredited investors, existing shareholders have the opportunity to utilize the Company's Dividend Reinvestment Plan if they have interest in adding to their investment in Kish Bancorp, Inc."

About Kish Bancorp, Inc.

Kish Bancorp, Inc. is a diversified financial services corporation headquartered in Belleville, PA with executive offices in State College and an Innovation Center in Reedsville. Kish Bank, a subsidiary of Kish Bancorp, Inc., operates 18 offices and financial centers serving Centre, Mifflin, Huntingdon, Blair, and Juniata counties, and northeastern Ohio. In addition to Kish Bank, other business units include: Kish Insurance, an independent property and casualty insurance agency; Kish Financial Solutions, which offers trust, fiduciary, and wealth management advisory services; Kish Benefits Consulting, which provides employee benefits consulting services; and Kish Travel, a full-service travel agency. KISB is the OTCQX stock ticker symbol for Kish Bancorp, Inc. For additional information, please visit ir.kishbancorp.comor otcmarkets.com/stock/KISB.