Net income for the nine months ended
Total assets as of
Non-performing assets, which include non-performing loans and foreclosed real estate owned, totaled
For the three months ended
Other income for the three months ended
Other expenses totaled
Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 contains safe harbor provisions regarding forward-looking statements. When used in this discussion, the words “believes”, “anticipates”, “contemplates”, “expects”, and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from those projected. Those risks and uncertainties include changes in federal and state laws, changes in interest rates, the risks and uncertainty posed by, and the effect and impact of, the COVID-19 pandemic on the economy and the Company’s results of operation and financial condition, the ability to control costs and expenses, demand for real estate, government fiscal and trade policies, cybersecurity and general economic conditions. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Non-GAAP Financial Measures
This release references tax-equivalent interest income and net interest income, which are non-GAAP (Generally Accepted Accounting Principles) financial measures. Tax-equivalent interest income and net interest income are derived from GAAP interest income and net interest income using an assumed tax rate of 21%. We believe the presentation of interest income and net interest income on a tax-equivalent basis ensures comparability of interest income and net interest income arising from both taxable and tax-exempt sources and is consistent with industry practice.
The following reconciles net interest income to net interest income on a taxable equivalent basis:
Three months ended | Nine months ended | ||||||||||
(dollars in thousands) | |||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||
Net interest income | $ | 15,330 | $ | 9,891 | $ | 34,862 | $ | 28,773 | |||
Tax equivalent basis adjustment using 21% marginal tax rate | 217 | 242 | 676 | 773 | |||||||
Net interest income on a fully taxable equivalent basis | $ | 15,547 | $ | 10,133 | $ | 35,538 | $ | 29,546 |
This release also references average tangible equity, which is also a non-GAAP financial measure. Average tangible equity is calculated by deducting average goodwill and other intangible assets from average stockholders’ equity. The Company believes that disclosure of tangible equity ratios enhances investor understanding of our financial position and improves the comparability of our financial data. The following reconciles average equity to average tangible equity: | ||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||
September 30 | September 30 | |||||||||||||||
(dollars in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Average equity | $ | 187,478 | $ | 134,037 | $ | 157,695 | $ | 129,367 | ||||||||
Average goodwill and other intangibles | (17,800 | ) | (11,597 | ) | (13,643 | ) | (11,623 | ) | ||||||||
Average tangible equity | $ | 169,678 | $ | 122,440 | $ | 144,052 | $ | 117,744 | ||||||||
Contact: | ||
Executive Vice President & | ||
Chief Financial Officer | ||
570-253-8505 | ||
www.waynebank.com | ||
Consolidated Balance Sheets | |||||||||||||||||
(dollars in thousands, except share and per share data) | |||||||||||||||||
(unaudited) | |||||||||||||||||
2020 | 2019 | ||||||||||||||||
ASSETS | |||||||||||||||||
Cash and due from banks | $ | 23,874 | $ | 20,067 | |||||||||||||
Interest-bearing deposits with banks | 100,566 | 848 | |||||||||||||||
Cash and cash equivalents | 124,440 | 20,915 | |||||||||||||||
Securities available for sale | 197,436 | 211,199 | |||||||||||||||
Loans receivable | 1,414,662 | 905,582 | |||||||||||||||
Less: Allowance for loan losses | 11,674 | 8,405 | |||||||||||||||
Net loans receivable | 1,402,988 | 897,177 | |||||||||||||||
Regulatory stock, at cost | 3,876 | 3,137 | |||||||||||||||
Bank premises and equipment, net | 18,124 | 13,927 | |||||||||||||||
Bank owned life insurance | 39,400 | 38,562 | |||||||||||||||
Foreclosed real estate owned | 965 | 1,572 | |||||||||||||||
Accrued interest receivable | 6,104 | 3,726 | |||||||||||||||
Goodwill | 30,213 | 11,331 | |||||||||||||||
Other intangible assets | 565 | 257 | |||||||||||||||
Other assets | 17,996 | 14,053 | |||||||||||||||
TOTAL ASSETS | $ | 1,842,107 | $ | 1,215,856 | |||||||||||||
LIABILITIES | |||||||||||||||||
Deposits: | |||||||||||||||||
Non-interest bearing demand | $ | 372,237 | $ | 231,211 | |||||||||||||
Interest-bearing | 1,143,685 | 743,222 | |||||||||||||||
Total deposits | 1,515,922 | 974,433 | |||||||||||||||
Short-term borrowings | 69,294 | 52,778 | |||||||||||||||
Other borrowings | 46,438 | 35,906 | |||||||||||||||
Accrued interest payable | 2,194 | 2,623 | |||||||||||||||
Other liabilities | 17,712 | 15,222 | |||||||||||||||
TOTAL LIABILITIES | 1,651,560 | 1,080,962 | |||||||||||||||
STOCKHOLDERS' EQUITY | |||||||||||||||||
Preferred Stock, no par value per share, authorized 5,000,000 shares | - | - | |||||||||||||||
Common Stock, | 821 | 632 | |||||||||||||||
Surplus | 95,108 | 49,052 | |||||||||||||||
Retained earnings | 90,422 | 84,522 | |||||||||||||||
(469 | ) | (455 | ) | ||||||||||||||
Accumulated other comprehensive income | 4,665 | 1,143 | |||||||||||||||
TOTAL STOCKHOLDERS' EQUITY | 190,547 | 134,894 | |||||||||||||||
TOTAL LIABILITIES AND | |||||||||||||||||
STOCKHOLDERS' EQUITY | $ | 1,842,107 | $ | 1,215,856 | |||||||||||||
Consolidated Statements of Income | |||||||||||||||||
(dollars in thousands, except per share data) | |||||||||||||||||
(unaudited) | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||
INTEREST INCOME | |||||||||||||||||
Loans receivable, including fees | $ | 16,260 | $ | 10,776 | $ | 37,711 | $ | 31,074 | |||||||||
Securities | 1,031 | 1,278 | 3,272 | 4,155 | |||||||||||||
Other | 18 | 5 | 43 | 70 | |||||||||||||
Total Interest income | 17,309 | 12,059 | 41,026 | 35,299 | |||||||||||||
INTEREST EXPENSE | |||||||||||||||||
Deposits | 1,676 | 1,787 | 5,096 | 5,355 | |||||||||||||
Short-term borrowings | 61 | 135 | 244 | 344 | |||||||||||||
Other borrowings | 242 | 246 | 824 | 827 | |||||||||||||
Total Interest expense | 1,979 | 2,168 | 6,164 | 6,526 | |||||||||||||
NET INTEREST INCOME | 15,330 | 9,891 | 34,862 | 28,773 | |||||||||||||
PROVISION FOR LOAN LOSSES | 1,850 | 300 | 3,850 | 1,050 | |||||||||||||
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 13,480 | 9,591 | 31,012 | 27,723 | |||||||||||||
OTHER INCOME | |||||||||||||||||
Service charges and fees | 1,301 | 1,200 | 3,201 | 3,283 | |||||||||||||
Income from fiduciary activities | 205 | 167 | 533 | 454 | |||||||||||||
Net realized gains on sales of securities | 33 | 169 | 71 | 233 | |||||||||||||
Gains on sales of loans, net | 164 | 15 | 285 | 125 | |||||||||||||
Earnings and proceeds on life insurance policies | 217 | 222 | 638 | 630 | |||||||||||||
Other | 152 | 109 | 391 | 358 | |||||||||||||
Total other income | 2,072 | 1,882 | 5,119 | 5,083 | |||||||||||||
OTHER EXPENSES | |||||||||||||||||
Salaries and employee benefits | 4,812 | 3,667 | 11,878 | 10,915 | |||||||||||||
Occupancy, furniture and equipment | 1,109 | 916 | 2,983 | 2,780 | |||||||||||||
Data processing and related operations | 746 | 480 | 1,649 | 1,400 | |||||||||||||
Taxes, other than income | 214 | 179 | 641 | 520 | |||||||||||||
Professional fees | 292 | 276 | 735 | 752 | |||||||||||||
FDIC Insurance assessment | 144 | (5 | ) | 186 | 150 | ||||||||||||
Foreclosed real estate | 31 | 24 | 44 | 37 | |||||||||||||
Amortization of intangibles | 35 | 23 | 79 | 79 | |||||||||||||
Merger related | 386 | - | 1,983 | - | |||||||||||||
Other | 1,611 | 1,231 | 4,353 | 3,591 | |||||||||||||
Total other expenses | 9,380 | 6,791 | 24,531 | 20,224 | |||||||||||||
INCOME BEFORE TAX | 6,172 | 4,682 | 11,600 | 12,582 | |||||||||||||
INCOME TAX EXPENSE | 1,173 | 775 | 2,033 | 1,963 | |||||||||||||
NET INCOME | $ | 4,999 | $ | 3,907 | $ | 9,567 | $ | 10,619 | |||||||||
Basic earnings per share | $ | 0.62 | $ | 0.62 | $ | 1.39 | $ | 1.70 | |||||||||
Diluted earnings per share | $ | 0.62 | $ | 0.62 | $ | 1.39 | $ | 1.68 | |||||||||
Financial Highlights (Unaudited) | |||||||||||||||||
(dollars in thousands, except per share data) | |||||||||||||||||
For the Three Months Ended | 2020 | 2019 | |||||||||||||||
Net interest income | $ | 15,330 | $ | 9,891 | |||||||||||||
Net income | 4,999 | 3,907 | |||||||||||||||
Net interest spread (fully taxable equivalent) | 3.55 | % | 3.35 | % | |||||||||||||
Net interest margin (fully taxable equivalent) | 3.73 | % | 3.60 | % | |||||||||||||
Return on average assets | 1.11 | % | 1.27 | % | |||||||||||||
Return on average equity | 10.64 | % | 11.56 | % | |||||||||||||
Return on average tangible equity | 11.75 | % | 12.66 | % | |||||||||||||
Basic earnings per share | $ | 0.62 | $ | 0.62 | |||||||||||||
Diluted earnings per share | $ | 0.62 | $ | 0.62 | |||||||||||||
For the Nine Months Ended | 2020 | 2019 | |||||||||||||||
Net interest income | $ | 34,862 | $ | 28,773 | |||||||||||||
Net income | 9,567 | 10,619 | |||||||||||||||
Net interest spread (fully taxable equivalent) | 3.30 | % | 3.26 | % | |||||||||||||
Net interest margin (fully taxable equivalent) | 3.51 | % | 3.51 | % | |||||||||||||
Return on average assets | 0.88 | % | 1.17 | % | |||||||||||||
Return on average equity | 8.13 | % | 10.97 | % | |||||||||||||
Return on average tangible equity | 8.90 | % | 12.06 | % | |||||||||||||
Basic earnings per share | $ | 1.39 | $ | 1.70 | |||||||||||||
Diluted earnings per share | $ | 1.39 | $ | 1.68 | |||||||||||||
As of | 2020 | 2019 | |||||||||||||||
Total assets | $ | 1,842,107 | $ | 1,215,856 | |||||||||||||
Total loans receivable | 1,414,662 | 905,582 | |||||||||||||||
Allowance for loan losses | 11,674 | 8,405 | |||||||||||||||
Total deposits | 1,515,922 | 974,433 | |||||||||||||||
Stockholders' equity | 190,547 | 134,894 | |||||||||||||||
Trust assets under management | 155,166 | 160,230 | |||||||||||||||
Book value per share | $ | 23.30 | $ | 21.41 | |||||||||||||
Tangible book value per share | $ | 19.55 | $ | 19.57 | |||||||||||||
Equity to total assets | 10.34 | % | 11.09 | % | |||||||||||||
Allowance to total loans receivable | 0.83 | % | 0.93 | % | |||||||||||||
Nonperforming loans to total loans | 0.89 | % | 0.15 | % | |||||||||||||
Nonperforming assets to total assets | 0.74 | % | 0.24 | % | |||||||||||||
Consolidated Balance Sheets (unaudited) | |||||||||||||||||
(dollars in thousands) | |||||||||||||||||
2020 | 2020 | 2020 | 2019 | 2019 | |||||||||||||
ASSETS | |||||||||||||||||
Cash and due from banks | $ | 23,874 | $ | 15,387 | $ | 14,712 | $ | 15,038 | $ | 20,067 | |||||||
Interest-bearing deposits with banks | 100,566 | 67,989 | 23,706 | 377 | 848 | ||||||||||||
Cash and cash equivalents | 124,440 | 83,376 | 38,418 | 15,415 | 20,915 | ||||||||||||
Securities available for sale | 197,436 | 196,735 | 196,998 | 210,205 | 211,199 | ||||||||||||
Loans receivable | 1,414,662 | 988,679 | 928,565 | 924,581 | 905,582 | ||||||||||||
Less: Allowance for loan losses | 11,674 | 10,312 | 9,088 | 8,509 | 8,405 | ||||||||||||
Net loans receivable | 1,402,988 | 978,367 | 919,477 | 916,072 | 897,177 | ||||||||||||
Regulatory stock, at cost | 3,876 | 3,677 | 3,770 | 4,844 | 3,137 | ||||||||||||
Bank owned life insurance | 39,400 | 39,183 | 38,971 | 38,763 | 38,562 | ||||||||||||
Bank premises and equipment, net | 18,124 | 14,040 | 14,071 | 14,228 | 13,927 | ||||||||||||
Foreclosed real estate owned | 965 | 965 | 1,077 | 1,556 | 1,572 | ||||||||||||
Goodwill and other intangibles | 30,778 | 11,522 | 11,543 | 11,566 | 11,588 | ||||||||||||
Other assets | 24,100 | 26,676 | 17,966 | 17,961 | 17,779 | ||||||||||||
TOTAL ASSETS | $ | 1,842,107 | $ | 1,354,541 | $ | 1,242,291 | $ | 1,230,610 | $ | 1,215,856 | |||||||
LIABILITIES | |||||||||||||||||
Deposits: | |||||||||||||||||
Non-interest bearing demand | $ | 372,237 | $ | 284,754 | $ | 213,359 | $ | 207,299 | $ | 231,211 | |||||||
Interest-bearing deposits | 1,143,685 | 801,484 | 776,801 | 750,230 | 743,222 | ||||||||||||
Total deposits | 1,515,922 | 1,086,238 | 990,160 | 957,529 | 974,433 | ||||||||||||
Borrowings | 115,732 | 106,027 | 92,006 | 118,694 | 88,684 | ||||||||||||
Other liabilities | 19,906 | 19,612 | 17,938 | 16,959 | 17,845 | ||||||||||||
TOTAL LIABILITIES | 1,651,560 | 1,211,877 | 1,100,104 | 1,093,182 | 1,080,962 | ||||||||||||
STOCKHOLDERS' EQUITY | 190,547 | 142,664 | 142,187 | 137,428 | 134,894 | ||||||||||||
TOTAL LIABILITIES AND | |||||||||||||||||
STOCKHOLDERS' EQUITY | $ | 1,842,107 | $ | 1,354,541 | $ | 1,242,291 | $ | 1,230,610 | $ | 1,215,856 | |||||||
Consolidated Statements of Income (unaudited) | |||||||||||||||||
(dollars in thousands, except per share data) | |||||||||||||||||
Three months ended | 2020 | 2020 | 2020 | 2019 | 2019 | ||||||||||||
INTEREST INCOME | |||||||||||||||||
Loans receivable, including fees | $ | 16,260 | $ | 10,767 | $ | 10,683 | $ | 10,815 | $ | 10,776 | |||||||
Securities | 1,031 | 1,063 | 1,179 | 1,159 | 1,278 | ||||||||||||
Other | 18 | 19 | 6 | 11 | 5 | ||||||||||||
Total interest income | 17,309 | 11,849 | 11,868 | 11,985 | 12,059 | ||||||||||||
INTEREST EXPENSE | |||||||||||||||||
Deposits | 1,676 | 1,630 | 1,790 | 1,784 | 1,787 | ||||||||||||
Borrowings | 303 | 352 | 413 | 368 | 381 | ||||||||||||
Total interest expense | 1,979 | 1,982 | 2,203 | 2,152 | 2,168 | ||||||||||||
NET INTEREST INCOME | 15,330 | 9,867 | 9,665 | 9,833 | 9,891 | ||||||||||||
PROVISION FOR LOAN LOSSES | 1,850 | 1,300 | 700 | 200 | 300 | ||||||||||||
NET INTEREST INCOME AFTER PROVISION | |||||||||||||||||
FOR LOAN LOSSES | 13,480 | 8,567 | 8,965 | 9,633 | 9,591 | ||||||||||||
OTHER INCOME | |||||||||||||||||
Service charges and fees | 1,301 | 837 | 1,063 | 1,168 | 1,200 | ||||||||||||
Income from fiduciary activities | 205 | 175 | 153 | 156 | 167 | ||||||||||||
Net realized gains on sales of securities | 33 | - | 38 | 21 | 169 | ||||||||||||
Gains on sales of loans, net | 164 | 65 | 56 | 44 | 15 | ||||||||||||
Earnings and proceeds on life insurance policies | 217 | 212 | 208 | 200 | 222 | ||||||||||||
Other | 152 | 103 | 136 | 107 | 109 | ||||||||||||
Total other income | 2,072 | 1,392 | 1,654 | 1,696 | 1,882 | ||||||||||||
OTHER EXPENSES | |||||||||||||||||
Salaries and employee benefits | 4,812 | 3,289 | 3,777 | 3,740 | 3,667 | ||||||||||||
Occupancy, furniture and equipment, net | 1,109 | 906 | 968 | 938 | 916 | ||||||||||||
Foreclosed real estate | 31 | (2 | ) | 16 | 9 | 24 | |||||||||||
FDIC insurance assessment | 144 | 42 | - | 3 | (5 | ) | |||||||||||
Merger related | 386 | 1,597 | - | - | - | ||||||||||||
Other | 2,898 | 2,260 | 2,298 | 2,398 | 2,189 | ||||||||||||
Total other expenses | 9,380 | 8,092 | 7,059 | 7,088 | 6,791 | ||||||||||||
INCOME BEFORE TAX | 6,172 | 1,867 | 3,560 | 4,241 | 4,682 | ||||||||||||
INCOME TAX EXPENSE | 1,173 | 379 | 481 | 645 | 775 | ||||||||||||
NET INCOME | $ | 4,999 | $ | 1,488 | $ | 3,079 | $ | 3,596 | $ | 3,907 | |||||||
Basic earnings per share | $ | 0.62 | $ | 0.24 | $ | 0.49 | $ | 0.57 | $ | 0.62 | |||||||
Diluted earnings per share | $ | 0.62 | $ | 0.24 | $ | 0.49 | $ | 0.57 | $ | 0.62 | |||||||
Book Value per share | $ | 23.30 | $ | 22.62 | $ | 22.52 | $ | 21.67 | $ | 21.41 | |||||||
Tangible Book Value per share | 19.55 | 20.80 | 20.70 | 19.84 | 19.57 | ||||||||||||
Return on average assets (annualized) | 1.11 | % | 0.45 | % | 1.01 | % | 1.18 | % | 1.27 | % | |||||||
Return on average equity (annualized) | 10.64 | % | 4.17 | % | 8.79 | % | 10.42 | % | 11.56 | % | |||||||
Return on average tangible equity (annualized) | 11.75 | % | 4.54 | % | 9.57 | % | 11.38 | % | 12.66 | % | |||||||
Net interest spread (fte) | 3.55 | % | 3.03 | % | 3.23 | % | 3.33 | % | 3.35 | % | |||||||
Net interest margin (fte) | 3.73 | % | 3.25 | % | 3.48 | % | 3.59 | % | 3.60 | % | |||||||
Allowance for loan losses to total loans | 0.83 | % | 1.04 | % | 0.98 | % | 0.92 | % | 0.93 | % | |||||||
Net charge-offs to average loans (annualized) | 0.14 | % | 0.03 | % | 0.05 | % | 0.04 | % | 0.05 | % | |||||||
Nonperforming loans to total loans | 0.89 | % | 0.30 | % | 0.30 | % | 0.09 | % | 0.15 | % | |||||||
Nonperforming assets to total assets | 0.74 | % | 0.29 | % | 0.31 | % | 0.19 | % | 0.24 | % | |||||||
Source:
2020 GlobeNewswire, Inc., source