For the quarter ended
The decrease in earnings results from a decrease in net interest income and an increase in the provision for loan losses. Net interest income decreased from
The decrease in net interest income is the result of the sudden decrease in interest rates due to the COVID 19 pandemic. Loan yields decreased from 6.10 percent in the third quarter of 2019 to 4.78 percent in the same quarter of 2020. The yield on interest earning assets decreased from 5.42 percent to 3.51 percent from the third quarter of 2019 to the third quarter of 2020. In addition to the overall decrease in interest rates, lower yields were affected by the bank’s participation in the Small Business Administration’s Paycheck Protection Plan (PPP). The Bank carried approximately
The provision for loan losses increased
Noninterest income remained virtually unchanged amounting to
Loan loss reserves were
Total assets were
Net income for the nine months ended
About
Non-GAAP Financial Measures
This report refers to the overhead efficiency ratio, which is computed by dividing non-interest expense by the sum of net interest income and non-interest income. This is a non-GAAP financial measure that we believe provides investors with important information regarding our operational efficiency. Comparison of our efficiency ratio with those of other companies may not be possible, because other companies may calculate the efficiency ratio differently. Such information is not in accordance with generally accepted accounting principles in
Forward Looking Statements
Information in this press release contains “forward-looking statements.” These statements reflect management's current beliefs as to the expected outcomes of future events and are not guarantees of future performance. These statements involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood, and degree of occurrence. As such, actual results and outcomes may materially differ from what may be expressed or forecast in such forward-looking statements. Factors that could cause a difference include, among others: changes in the national and local economies or market conditions; changes in interest rates, deposit levels, loan demand and asset quality, including real estate and other collateral values; changes in banking regulations and accounting principles, policies or guidelines; and the impact of competition from traditional or new sources. These and other factors that may emerge could cause decisions and actual results to differ materially from current expectations.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Dollars in thousands, except per share amounts) | ||||||||||||
2020 | 2019 | 2019 | ||||||||||
(unaudited) | (audited) | (unaudited) | ||||||||||
Total assets | $ | 425,397 | $ | 329,520 | $ | 331,634 | ||||||
Total loans | 282,328 | 237,393 | 239,392 | |||||||||
Investments | 124,282 | 72,777 | 66,457 | |||||||||
Deposits | 368,067 | 276,360 | 278,111 | |||||||||
Stockholders’ equity | 49,698 | 47,927 | 47,727 | |||||||||
Non-performing assets to total assets | 0.11 | % | 0.38 | % | 0.38 | % | ||||||
Loans past due more than 90 days to total loans | 0.02 | % | 0.02 | % | 0.02 | % | ||||||
Allowance for loan losses to total loans | 1.67 | % | 1.74 | % | 1.72 | % | ||||||
Tangible book value per common share | $ | 11.50 | $ | 11.20 | $ | 11.15 | ||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS (Dollars in thousands, except per share amounts) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Interest income | $ | 3,360 | $ | 3,994 | $ | 10,054 | $ | 11,199 | ||||||||
Interest expense | 275 | 336 | 900 | 956 | ||||||||||||
Net interest income | 3,085 | 3,658 | 9,154 | 10,243 | ||||||||||||
Provision for loan losses | 196 | (132 | ) | 564 | 78 | |||||||||||
Net interest income after provision for loan losses | 2,889 | 3,790 | 8,590 | 10,165 | ||||||||||||
Noninterest income | 619 | 619 | 1,989 | 1,872 | ||||||||||||
Noninterest expense | 2,163 | 2,222 | 6,633 | 6,901 | ||||||||||||
Net income before taxes | 1,345 | 2,187 | 3,946 | 5,136 | ||||||||||||
Provision for income taxes | 293 | 510 | 866 | 1,352 | ||||||||||||
Net income | 1,052 | 1,677 | 3,080 | 3,784 | ||||||||||||
Basic net income per share | $ | 0.25 | $ | 0.40 | $ | 0.74 | $ | 0.91 | ||||||||
Diluted net income per share | $ | 0.25 | $ | 0.40 | $ | 0.74 | $ | 0.91 | ||||||||
Return on average total assets(1) | 1.03 | % | 2.10 | % | 1.10 | % | 1.61 | % | ||||||||
Return on average total equity(1) | 8.49 | % | 14.17 | % | 8.40 | % | 10.86 | % | ||||||||
Yield on average interest earning assets | 3.51 | % | 5.42 | % | 3.81 | % | 5.16 | % | ||||||||
Cost of funds | 0.32 | % | 0.51 | % | 0.38 | % | 0.49 | % | ||||||||
Net yield on average interest earning assets | 3.23 | % | 4.96 | % | 3.47 | % | 4.72 | % | ||||||||
Overhead efficiency ratio | 58.39 | % | 51.95 | % | 59.53 | % | 56.96 | % | ||||||||
Net charge-offs (recoveries)/average loans | 0.01 | % | 0.10 | % | (0.01 | )% | 0.07 | % |
(1) Annualized for all periods presented.
For additional information, please contactTed Ashby , CEO, orMark Towe , CFO (336) 783-3900
Source:
2020 GlobeNewswire, Inc., source