Financial News

CB Financial Services, Inc. Announces Third Quarter and Year-to-Date 2023 Financial Results and Declares Quarterly Cash Dividend

CB Financial Services, Inc. (“CB” or the “Company”) (NASDAQGM: CBFV), the holding company of Community Bank (the “Bank”) and Exchange Underwriters, Inc. (“EU”), a wholly-owned insurance subsidiary of the Bank, today announced its third quarter and year-to-date 2023 financial results.

2023 Third Quarter Financial Highlights

(Comparisons to three months ended September 30, 2022 unless otherwise noted)

  • Net income was $2.7 million, compared to $3.9 million. Current period results were negatively impacted by net interest margin (NIM) compression coupled with increases in the provision for credit losses and noninterest expense and a decrease in noninterest income, partially offset by a decrease in income tax expense.
    • Income before income tax expense was $3.2 million compared to $4.9 million.
    • Pre-provision net revenue (PPNR) (non-GAAP) was $3.5 million compared to $4.9 million.
  • Earnings per diluted common share (EPS) decreased to $0.52 from $0.77.
  • Return on average assets (annualized) was 0.75%, compared to 1.12%.
  • Return on average equity (annualized) was 9.03%, compared to 13.60%.
  • NIM declined to 3.13% from 3.29%.
  • Net interest and dividend income was $10.7 million, compared to $11.0 million.
  • Noninterest income decreased to $2.4 million, compared to $2.7 million. Prior period noninterest income included a $439,000 gain recognized as a result of the sale of assets of two closed branch locations.
  • Noninterest expense increased to $9.5 million, compared to $8.8 million, primarily due to increases in compensation and benefits, equipment and data processing costs.

(Amounts at September 30, 2023; comparisons to December 31, 2022, unless otherwise noted)

  • Total assets decreased to $1.40 billion from $1.41 billion.
  • Total loans increased $52.6 million, or 5.0%, to $1.10 billion compared to $1.05 billion, and included increases of $30.8 million, or 44.0%, in commercial and industrial loans, $30.1 million, or 6.9%, in commercial real estate loans, and $15.8 million, or 4.8%, in residential mortgage loans, partially offset by a decrease of $24.4 million, or 16.6%, in consumer loans, which is primarily comprised of indirect automobile loans.
  • Nonperforming loans to total loans was 0.30%, a decrease of 25 basis points (“bps”), compared to 0.55%.
  • Total deposits were $1.24 billion, a decrease of $32.2 million, compared to $1.27 billion.
  • Book value per share was $22.43, compared to $22.81 as of June 30, 2023 and $21.60 as of December 31, 2022.
  • Tangible book value per share (Non-GAAP) was $20.10, compared to $20.39 as of June 30, 2023 and $19.00 as of December 31, 2022. The year-to-date change was due to an increase in stockholders’ equity primarily related to current period net income of $9.6 million and a $2.1 million positive adjustment due to the Company’s January 1, 2023 adoption of CECL, partially offset by current period dividends paid to stockholders of $3.8 million.

Management Commentary

President and CEO John H. Montgomery stated, “Our third quarter results, while impacted by pressures on funding costs, continue to support our model of investing in our franchise and focusing on delivering an exceptional client experience.

As we have noted for several quarters, the net interest margin compression continues as our customers respond to the overall increase in market interest rates, while being partially offset by the gradual and increasing shift in our asset base from consumer loans into higher yielding commercial and industrial loans and commercial real estate loans. We continued to make investments in our team, resulting in substantial loan growth and onboarding of new relationships. We firmly believe that the challenges of the economic environment provide an opportunity for quality relationship growth, increasing our long term franchise value and benefiting all of our stakeholders. In addition to our loan growth, our asset quality remains strong with nonperforming assets to total assets decreasing from the previous quarter.

During the quarter, significant progress was made on a number of strategic initiatives, including investing in technology and refreshing our branch network, creating the physical environment for technology and our team members to work cohesively in serving our customers. Additionally, we also declared and paid a $0.25 cash dividend during the quarter, continuing our commitment to our shareholders.”

Mr. Montgomery concluded, “As I have noted previously, we remain focused on maintaining solid capital and liquidity positions as we continue to navigate the challenging economic environment and position ourselves for the future.”

Dividend Information

The Company’s Board of Directors declared a $0.25 quarterly cash dividend per outstanding share of common stock, payable on or about November 30, 2023, to stockholders of record as of the close of business on November 15, 2023.

2023 Third Quarter Financial Review

Net Interest and Dividend Income

Net interest and dividend income decreased $298,000, or 2.7%, to $10.7 million for the three months ended September 30, 2023 compared to $11.0 million for the three months ended September 30, 2022.

  • Net interest margin (GAAP) decreased to 3.13% for the three months ended September 30, 2023 compared to 3.29% for the three months ended September 30, 2022. Fully tax equivalent (FTE) net interest margin (Non-GAAP) decreased 16 bps to 3.14% for the three months ended September 30, 2023 compared to 3.30% for the three months ended September 30, 2022.
  • Interest and dividend income increased $3.6 million, or 29.2%, to $15.9 million for the three months ended September 30, 2023 compared to $12.3 million for the three months ended September 30, 2022.
    • Interest income on loans increased $3.2 million, or 29.9%, to $14.0 million for the three months ended September 30, 2023 compared to $10.8 million for the three months ended September 30, 2022. The average balance of loans increased $64.3 million to $1.09 billion from $1.02 billion, generating $729,000 of additional interest income on loans. The average yield increased 93 bps to 5.13% compared to 4.20% resulting in a $2.5 million increase in interest income on loans.
    • Interest income on interest-earning deposits at other banks increased $372,000, to $750,000 for the three months ended September 30, 2023 compared to $378,000 for the three months ended September 30, 2022 as the average yield increased 347 bps, partially offset by a $15.2 million decrease in average balances. The increase in the average yield was the result of the Federal Reserve Board’s interest rate increases.
  • Interest expense increased $3.9 million, or 305.4%, to $5.2 million for the three months ended September 30, 2023 compared to $1.3 million for the three months ended September 30, 2022.
    • Interest expense on deposits increased $3.7 million, or 340.2%, to $4.8 million for the three months ended September 30, 2023 compared to $1.1 million for the three months ended September 30, 2022. Rising market interest rates led to the repricing of interest-bearing demand and money market deposits and a shift in deposits from noninterest-bearing to interest-bearing demand and time deposits resulted in a 150 bps, or 295.2%, increase in the average cost of interest-bearing deposits compared to the three months ended September 30, 2022. This accounted for a $3.5 million increase in interest expense. Additionally, interest-bearing deposit balances increased $95.4 million, or 11.3%, to $937.8 million as of September 30, 2023 compared to $842.4 million as of September 30, 2022, accounting for a $138,000 increase in interest expense.

Provision for Credit Losses

Effective January 1, 2023, the Company adopted ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”, which replaced the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (CECL) methodology. The provision for credit losses recorded for the three months ended September 30, 2023 was $406,000 and was required primarily due to changes in qualitative factors coupled with a modeled slowdown in loan prepayment speeds. This compared to no provision for credit losses recorded for the three months ended September 30, 2022.

Noninterest Income

Noninterest income decreased $327,000, or 11.9%, to $2.4 million for the three months ended September 30, 2023, compared to $2.7 million for the three months ended September 30, 2022. This decrease was primarily related to a $439,000 decrease in net gain on disposal of fixed assets as the prior period included a $439,000 gain resulting from the sale of assets of two closed branch locations.

Noninterest Expense

Noninterest expense increased $660,000, or 7.5%, to $9.5 million for the three months ended September 30, 2023 compared to $8.8 million for the three months ended September 30, 2022. Salaries and benefits increased $630,000, or 13.3%, to $5.4 million primarily due to merit increases and revenue producing staff additions. Data processing expense increased $174,000, or 32.2%, to $714,000, due to increased ongoing costs related to the fourth quarter 2022 core conversion and equipment expense increased $95,000 or 55.9%, to $265,000, due to costs associated with the implementation and operation of new interactive teller machines.

Statement of Financial Condition Review

Assets

Total assets decreased $9.4 million, or 0.7%, to $1.40 billion at September 30, 2023, compared to $1.41 billion at December 31, 2022.

  • Cash and due from banks decreased $51.1 million, or 49.3%, to $52.6 million at September 30, 2023, compared to $103.7 million at December 31, 2022, due to significant loan growth.
  • Securities decreased $17.2 million, or 9.0%, to $172.9 million at September 30, 2023, compared to $190.1 million at December 31, 2022. The securities balance was primarily impacted by $12.4 million of repayments on mortgage-backed and collateralized mortgage obligation securities and a $369,000 decrease in the market value in the equity securities portfolio, which is primarily comprised of bank stocks.

Loans and Credit Quality

  • Total loans increased $52.6 million, or 5.0%, to $1.10 billion at September 30, 2023 compared to $1.05 billion at December 31, 2022. Loan growth was driven by increases in commercial and industrial loans, commercial real estate loans and residential mortgage loans of $30.8 million, $30.1 million, and $15.8 million, respectively, partially offset by a decrease in consumer loans of $24.4 million. The decrease in consumer loans resulted from a reduction in indirect automobile loan production due to rising market interest rates and the discontinuation of this product offering as of June 30, 2023. This portfolio is expected to continue to decline as resources are allocated and production efforts are focused on more profitable commercial products.
  • The allowance for credit losses (ACL) was $10.8 million at September 30, 2023 and $12.8 million at December 31, 2022. As a result, the ACL to total loans was 0.98% at September 30, 2023 compared to 1.22% at December 31, 2022. The change in the ACL was primarily due to the Company's aforementioned adoption of CECL. At adoption, the Company decreased its ACL by $3.4 million. Contributing to the change in ACL was a prior year charge-off of $2.7 million and qualitative factors that significantly impacted the incurred loss model driven by historical activity compared to the adopted CECL methodology that is centered around CECL activity using a forecast approach.
  • Net charge-offs for the three months ended September 30, 2023 were $109,000, or 0.04% of average loans on an annualized basis. Net recoveries for the three months ended September 30, 2022 were $21,000, or 0.01% of average loans on an annualized basis. Net recoveries for the nine months ended September 30, 2023 were $551,000 primarily due to recoveries totaling $750,000 related to the prior year $2.7 million charged-off commercial and industrial loan. Net charge-offs for the nine months ended September 30, 2022 were $2.5 million.
  • Nonperforming loans, which includes nonaccrual loans and accruing loans past due 90 days or more, were $3.3 million at September 30, 2023 compared to $5.8 million at December 31, 2022. The decrease of $2.5 million was due to ten loans totaling $1.7 million transferred from nonaccrual to accrual status during the current period and the repayment of a $1.6 million commercial real estate loan that was previously on nonaccrual status. Partially offsetting these favorable movements, a $757,000 commercial real estate loan moved to nonaccrual status during the period. Nonperforming loans to total loans ratio was 0.30% at September 30, 2023 compared to 0.55% at December 31, 2022.

Other

  • Intangible assets decreased $1.3 million, or 37.0%, to $2.2 million at September 30, 2023 compared to $3.5 million at December 31, 2022 due to amortization expense recognized during the period.
  • Accrued interest and other assets increased $5.5 million or 26.0%, to $26.7 million at September 30, 2023, compared to $21.1 million at December 31, 2022 due to the sale of a $2.0 million syndicated loan which was sold but not yet settled at September 30, 2023, and increases in prepaid expenses and accrued interest receivable of $1.2 million and $600,000.

Total liabilities decreased $14.1 million, or 1.1%, to $1.28 billion at September 30, 2023 compared to $1.30 billion at December 31, 2022.

Deposits

  • Total deposits decreased $32.2 million to $1.24 billion as of September 30, 2023 compared to $1.27 billion at December 31, 2022. Interest-bearing demand deposits increased $45.6 million and time deposits increased $68.3 million, while non interest-bearing demand deposits decreased $85.3 million, savings deposits decreased $40.9 million, and money market deposits decreased $19.9 million. The increase in interest-bearing demand deposits was primarily the result of higher interest rates attracting more customers and additional deposits from existing customers while higher time deposits resulted from the offering of a higher-rate certificate of deposit product. FDIC insured deposits totaled approximately 60.5% of total deposits while an additional 16.9% of deposits were collateralized with investment securities.

Borrowed Funds

  • Long-term borrowings increased $20.0 million, or 136.6%, to $34.7 million at September 30, 2023, compared to $14.6 million at December 31, 2022. During the second quarter, the Bank entered into $20.0 million of FHLB advances for a term of 24 months at 4.92%, the proceeds of which were utilized to match fund originations within the Bank’s commercial and industrial loan portfolio.
  • Short-term borrowings decreased $8.1 million, or 100.0%, as there were no short-term borrowings at September 30, 2023, compared to $8.1 million at December 31, 2022. At December 31, 2022, short-term borrowings were comprised entirely of securities sold under agreements to repurchase. These accounts were transitioned into other deposit products and account for a portion of the interest-bearing demand deposit increase.

Accrued Interest Payable and Other Liabilities

  • Accrued interest payable and other liabilities increased $6.1 million, or 80.5%, to $13.7 million at September 30, 2023, compared to $7.6 million at December 31, 2022 primarily due to the purchase of $3.9 million of syndicated loans which were unfunded at the end of the period and a $1.1 million increase in accrued interest payable on certificate accounts.

Stockholders’ Equity

Stockholders’ equity increased $4.7 million, or 4.3%, to $114.8 million at September 30, 2023, compared to $110.2 million at December 31, 2022. Key factors positively impacting stockholders’ equity included $9.6 million of net income for the current period and a $2.1 million positive adjustment, net of tax, due to the Company’s January 1, 2023 adoption of CECL as described above. These factors were partially offset by the payment of $3.8 million in dividends since December 31, 2022 and activity under share repurchase programs. On April 21, 2022, a $10.0 million repurchase program was authorized, with the Company repurchasing 74,656 shares at an average price of $22.38 per share since the inception of the program. In total, the Company repurchased $274,000 of common stock since December 31, 2022. The program expired on May 1, 2023.

Book value per share

Book value per common share was $22.43 at September 30, 2023 compared to $21.60 at December 31, 2022, an increase of $0.83.

Tangible book value per common share (Non-GAAP) was $20.10 at September 30, 2023, compared to $19.00 at December 31, 2022, an increase of $1.10.

Refer to “Explanation of Use of Non-GAAP Financial Measures” at the end of this Press Release.

About CB Financial Services, Inc.

CB Financial Services, Inc. is the bank holding company for Community Bank, a Pennsylvania-chartered commercial bank. Community Bank operates its branch network in southwestern Pennsylvania and West Virginia. Community Bank offers a broad array of retail and commercial lending and deposit services and provides commercial and personal insurance brokerage services through Exchange Underwriters, Inc., its wholly owned subsidiary.

For more information about CB Financial Services, Inc. and Community Bank, visit our website at www.communitybank.tv.

Statement About Forward-Looking Statements

Statements contained in this press release that are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 and such forward-looking statements are subject to significant risks and uncertainties. The Company intends such forward-looking statements to be covered by the safe harbor provisions contained in the Act. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of the Company and its subsidiaries include, but are not limited to, general and local economic conditions, changes in market interest rates, deposit flows, demand for loans, real estate values and competition, competitive products and pricing, the ability of our customers to make scheduled loan payments, loan delinquency rates and trends, our ability to manage the risks involved in our business, our ability to control costs and expenses, inflation, market and monetary fluctuations, changes in federal and state legislation and regulation applicable to our business, actions by our competitors, and other factors that may be disclosed in the Company’s periodic reports as filed with the Securities and Exchange Commission. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.

CB FINANCIAL SERVICES, INC.

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Dollars in thousands, except share and per share data) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Financial Condition Data

9/30/23

 

6/30/23

 

3/31/23

 

12/31/22

 

9/30/22

Assets

 

 

 

 

 

 

 

 

 

Cash and Due From Banks

$

52,597

 

 

$

78,093

 

 

$

103,545

 

 

$

103,700

 

 

$

122,801

 

Securities

 

172,904

 

 

 

181,427

 

 

 

189,025

 

 

 

190,058

 

 

 

193,846

 

Loans

 

 

 

 

 

 

 

 

 

Real Estate:

 

 

 

 

 

 

 

 

 

Residential

 

346,485

 

 

 

338,493

 

 

 

332,840

 

 

 

330,725

 

 

 

328,248

 

Commercial

 

466,910

 

 

 

458,614

 

 

 

452,770

 

 

 

436,805

 

 

 

432,516

 

Construction

 

41,874

 

 

 

44,523

 

 

 

39,522

 

 

 

44,923

 

 

 

49,502

 

Commercial and Industrial:

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

100,852

 

 

 

102,232

 

 

 

79,436

 

 

 

69,918

 

 

 

61,428

 

PPP

 

21

 

 

 

34

 

 

 

65

 

 

 

126

 

 

 

768

 

Consumer

 

122,516

 

 

 

134,788

 

 

 

146,081

 

 

 

146,927

 

 

 

150,615

 

Other

 

23,856

 

 

 

22,470

 

 

 

21,151

 

 

 

20,449

 

 

 

19,865

 

Total Loans

 

1,102,514

 

 

 

1,101,154

 

 

 

1,071,865

 

 

 

1,049,873

 

 

 

1,042,942

 

Allowance for Credit Losses

 

(10,848

)

 

 

(10,666

)

 

 

(10,270

)

 

 

(12,819

)

 

 

(12,854

)

Loans, Net

 

1,091,666

 

 

 

1,090,488

 

 

 

1,061,595

 

 

 

1,037,054

 

 

 

1,030,088

 

Premises and Equipment, Net

 

18,524

 

 

 

18,582

 

 

 

17,732

 

 

 

17,844

 

 

 

18,064

 

Bank-Owned Life Insurance

 

25,227

 

 

 

25,082

 

 

 

24,943

 

 

 

25,893

 

 

 

25,750

 

Goodwill

 

9,732

 

 

 

9,732

 

 

 

9,732

 

 

 

9,732

 

 

 

9,732

 

Intangible Assets, Net

 

2,177

 

 

 

2,622

 

 

 

3,068

 

 

 

3,513

 

 

 

3,959

 

Accrued Interest Receivable and Other Assets

 

26,665

 

 

 

26,707

 

 

 

21,068

 

 

 

21,144

 

 

 

21,680

 

Total Assets

$

1,399,492

 

 

$

1,432,733

 

 

$

1,430,708

 

 

$

1,408,938

 

 

$

1,425,920

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

Noninterest-Bearing Demand Accounts

$

305,145

 

 

$

316,098

 

 

$

350,911

 

 

$

390,405

 

 

$

407,107

 

Interest-Bearing Demand Accounts

 

357,381

 

 

 

374,654

 

 

 

359,051

 

 

 

311,825

 

 

 

298,755

 

Money Market Accounts

 

189,187

 

 

 

185,814

 

 

 

206,174

 

 

 

209,125

 

 

 

198,715

 

Savings Accounts

 

207,148

 

 

 

217,267

 

 

 

234,935

 

 

 

248,022

 

 

 

250,378

 

Time Deposits

 

177,428

 

 

 

169,482

 

 

 

130,449

 

 

 

109,126

 

 

 

120,879

 

Total Deposits

 

1,236,289

 

 

 

1,263,315

 

 

 

1,281,520

 

 

 

1,268,503

 

 

 

1,275,834

 

 

 

 

 

 

 

 

 

 

 

Short-Term Borrowings

 

 

 

 

 

 

 

121

 

 

 

8,060

 

 

 

18,108

 

Other Borrowings

 

34,668

 

 

 

34,658

 

 

 

14,648

 

 

 

14,638

 

 

 

17,627

 

Accrued Interest Payable and Other Liabilities

 

13,689

 

 

 

18,171

 

 

 

17,224

 

 

 

7,582

 

 

 

7,645

 

Total Liabilities

 

1,284,646

 

 

 

1,316,144

 

 

 

1,313,513

 

 

 

1,298,783

 

 

 

1,319,214

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ Equity

 

114,846

 

 

 

116,589

 

 

 

117,195

 

 

 

110,155

 

 

 

106,706

 

Total Liabilities and Stockholders’ Equity

$

1,399,492

 

 

$

1,432,733

 

 

$

1,430,708

 

 

$

1,408,938

 

 

$

1,425,920

 

 

 

 

 

 

 

 

 

(Dollars in thousands, except share and per share data) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

Nine Months Ended

Selected Operating Data

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

9/30/23

9/30/22

Interest and Dividend Income:

 

 

 

 

 

 

 

Loans, Including Fees

$

14,049

 

$

13,426

 

$

12,371

 

$

11,835

 

$

10,815

 

$

39,846

 

$

30,098

 

Securities:

 

 

 

 

 

 

 

Taxable

 

940

 

 

950

 

 

964

 

 

974

 

 

985

 

 

2,853

 

 

2,878

 

Tax-Exempt

 

41

 

 

42

 

 

41

 

 

40

 

 

49

 

 

124

 

 

172

 

Dividends

 

25

 

 

25

 

 

24

 

 

28

 

 

21

 

 

74

 

 

64

 

Other Interest and Dividend Income

 

819

 

 

760

 

 

844

 

 

978

 

 

417

 

 

2,424

 

 

649

 

Total Interest and Dividend Income

 

15,874

 

 

15,203

 

 

14,244

 

 

13,855

 

 

12,287

 

 

45,321

 

 

33,861

 

Interest Expense:

 

 

 

 

 

 

 

Deposits

 

4,750

 

 

3,842

 

 

2,504

 

 

1,811

 

 

1,079

 

 

11,097

 

 

2,214

 

Short-Term Borrowings

 

 

 

3

 

 

2

 

 

7

 

 

19

 

 

5

 

 

56

 

Other Borrowings

 

407

 

 

238

 

 

155

 

 

171

 

 

174

 

 

800

 

 

522

 

Total Interest Expense

 

5,157

 

 

4,083

 

 

2,661

 

 

1,989

 

 

1,272

 

 

11,902

 

 

2,792

 

Net Interest and Dividend Income

 

10,717

 

 

11,120

 

 

11,583

 

 

11,866

 

 

11,015

 

 

33,419

 

 

31,069

 

Provision for Credit Losses - Loans

 

291

 

 

492

 

 

80

 

 

 

 

 

 

863

 

 

3,784

 

Provision (Recovery) for Credit Losses - Unfunded Commitments

 

115

 

 

(60

)

 

 

 

 

 

 

 

54

 

 

 

Net Interest and Dividend Income After Provision for Credit Losses

 

10,311

 

 

10,688

 

 

11,503

 

 

11,866

 

 

11,015

 

 

32,502

 

 

27,285

 

Noninterest Income:

 

 

 

 

 

 

 

Service Fees

 

466

 

 

448

 

 

445

 

 

530

 

 

544

 

 

1,359

 

 

1,629

 

Insurance Commissions

 

1,436

 

 

1,511

 

 

1,922

 

 

1,399

 

 

1,368

 

 

4,870

 

 

4,535

 

Other Commissions

 

94

 

 

224

 

 

144

 

 

157

 

 

244

 

 

462

 

 

512

 

Net (Loss) Gain on Sales of Loans

 

 

 

(5

)

 

2

 

 

 

 

 

 

(3

)

 

 

Net (Loss) Gain on Securities

 

(37

)

 

(100

)

 

(232

)

 

83

 

 

(46

)

 

(369

)

 

(252

)

Net Gain on Purchased Tax Credits

 

7

 

 

7

 

 

7

 

 

14

 

 

14

 

 

22

 

 

43

 

Net Gain on Disposal of Fixed Assets

 

 

 

 

 

11

 

 

 

 

439

 

 

11

 

 

431

 

Income from Bank-Owned Life Insurance

 

145

 

 

139

 

 

140

 

 

143

 

 

140

 

 

425

 

 

418

 

Net Gain on Bank-Owned Life Insurance Claims

 

 

 

1

 

 

302

 

 

 

 

 

 

303

 

 

 

Other Income

 

301

 

 

44

 

 

69

 

 

34

 

 

36

 

 

413

 

 

143

 

Total Noninterest Income

 

2,412

 

 

2,269

 

 

2,810

 

 

2,360

 

 

2,739

 

 

7,493

 

 

7,459

 

Noninterest Expense:

 

 

 

 

 

 

 

Salaries and Employee Benefits

 

5,369

 

 

5,231

 

 

5,079

 

 

4,625

 

 

4,739

 

 

15,679

 

 

13,843

 

Occupancy

 

698

 

 

789

 

 

701

 

 

817

 

 

768

 

 

2,188

 

 

2,230

 

Equipment

 

265

 

 

283

 

 

218

 

 

178

 

 

170

 

 

766

 

 

561

 

Data Processing

 

714

 

 

718

 

 

857

 

 

681

 

 

540

 

 

2,289

 

 

1,471

 

FDIC Assessment

 

189

 

 

224

 

 

152

 

 

154

 

 

147

 

 

565

 

 

484

 

PA Shares Tax

 

217

 

 

195

 

 

260

 

 

258

 

 

240

 

 

672

 

 

721

 

Contracted Services

 

286

 

 

434

 

 

147

 

 

405

 

 

288

 

 

868

 

 

1,223

 

Legal and Professional Fees

 

320

 

 

246

 

 

182

 

 

362

 

 

334

 

 

748

 

 

876

 

Advertising

 

114

 

 

75

 

 

79

 

 

165

 

 

131

 

 

268

 

 

362

 

Other Real Estate Owned (Income)

 

(8

)

 

(35

)

 

(37

)

 

(38

)

 

(38

)

 

(80

)

 

(113

)

Amortization of Intangible Assets

 

445

 

 

446

 

 

445

 

 

446

 

 

445

 

 

1,336

 

 

1,336

 

Other

 

878

 

 

895

 

 

945

 

 

945

 

 

1,063

 

 

2,718

 

 

2,899

 

Total Noninterest Expense

 

9,487

 

 

9,501

 

 

9,028

 

 

8,998

 

 

8,827

 

 

28,017

 

 

25,893

 

Income Before Income Tax Expense

 

3,236

 

 

3,456

 

 

5,285

 

 

5,228

 

 

4,927

 

 

11,978

 

 

8,851

 

Income Tax Expense

 

564

 

 

699

 

 

1,129

 

 

1,076

 

 

998

 

 

2,392

 

 

1,757

 

Net Income

$

2,672

 

$

2,757

 

$

4,156

 

$

4,152

 

$

3,929

 

$

9,586

 

$

7,094

 

 

Three Months Ended

Nine Months Ended

Per Common Share Data

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

9/30/23

9/30/22

Dividends Per Common Share

$

0.25

$

0.25

$

0.25

$

0.24

$

0.24

$

0.75

$

0.72

Earnings Per Common Share - Basic

 

0.52

 

0.54

 

0.81

 

0.81

 

0.77

 

1.88

 

1.38

Earnings Per Common Share - Diluted

 

0.52

 

0.54

 

0.81

 

0.81

 

0.77

 

1.87

 

1.37

 

 

 

 

 

 

 

 

Weighted Average Common Shares Outstanding - Basic

 

5,115,026

 

5,111,987

 

5,109,597

 

5,095,237

 

5,106,861

 

5,112,223

 

5,150,632

Weighted Average Common Shares Outstanding - Diluted

 

5,126,546

 

5,116,134

 

5,115,705

 

5,104,254

 

5,118,627

 

5,118,279

 

5,165,376

 

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

Common Shares Outstanding

 

5,120,678

 

 

5,111,678

 

 

5,116,830

 

 

5,100,189

 

 

5,096,672

 

Book Value Per Common Share

$

22.43

 

$

22.81

 

$

22.90

 

$

21.60

 

$

20.94

 

Tangible Book Value per Common Share (1)

 

20.10

 

 

20.39

 

 

20.40

 

 

19.00

 

 

18.25

 

Stockholders’ Equity to Assets

 

8.2

%

 

8.1

%

 

8.2

%

 

7.8

%

 

7.5

%

Tangible Common Equity to Tangible Assets (1)

 

7.4

 

 

7.3

 

 

7.4

 

 

6.9

 

 

6.6

 

 

Three Months Ended

Nine Months Ended

Selected Financial Ratios (2)

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

9/30/23

9/30/22

Return on Average Assets

0.75

%

0.79

%

1.21

%

1.16

%

1.12

%

0.91

%

0.68

%

Return on Average Equity

9.03

 

9.38

 

14.69

 

15.26

 

13.60

 

10.98

 

7.85

 

Average Interest-Earning Assets to Average Interest-Bearing Liabilities

139.67

 

142.37

 

147.53

 

149.04

 

149.41

 

143.07

 

147.64

 

Average Equity to Average Assets

8.32

 

8.38

 

8.27

 

7.63

 

8.20

 

8.33

 

8.61

 

Net Interest Rate Spread

2.54

 

2.78

 

3.12

 

3.17

 

3.10

 

2.80

 

3.03

 

Net Interest Rate Spread (FTE) (1)

2.55

 

2.79

 

3.13

 

3.18

 

3.11

 

2.81

 

3.04

 

Net Interest Margin

3.13

 

3.29

 

3.51

 

3.45

 

3.29

 

3.31

 

3.17

 

Net Interest Margin (FTE) (1)

3.14

 

3.30

 

3.52

 

3.46

 

3.30

 

3.32

 

3.18

 

Net Charge-Offs (Recoveries) to Average Loans

0.04

 

0.04

 

(0.29

)

0.01

 

(0.01

)

(0.07

)

0.33

 

Efficiency Ratio

72.26

 

70.96

 

62.72

 

63.25

 

64.18

 

68.48

 

67.21

 

Asset Quality Ratios

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

Allowance for Credit Losses to Total Loans

0.98

%

0.97

%

0.96

%

1.22

%

1.23

%

Allowance for Credit Losses to Nonperforming Loans (3)

330.13

 

260.46

 

189.73

 

221.06

 

218.61

 

Allowance for Credit Losses to Noncurrent Loans (4)

330.13

 

260.46

 

189.73

 

320.64

 

318.96

 

Delinquent and Nonaccrual Loans to Total Loans (4) (5)

0.73

 

0.68

 

1.02

 

0.81

 

0.46

 

Nonperforming Loans to Total Loans (3)

0.30

 

0.37

 

0.51

 

0.55

 

0.56

 

Noncurrent Loans to Total Loans (4)

0.30

 

0.37

 

0.51

 

0.38

 

0.39

 

Nonperforming Assets to Total Assets (6)

0.23

 

0.30

 

0.40

 

0.41

 

0.41

 

Capital Ratios (7)

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

Common Equity Tier 1 Capital (to Risk Weighted Assets)

12.77

%

12.54

%

12.60

%

12.33

%

12.02

%

Tier 1 Capital (to Risk Weighted Assets)

12.77

 

12.54

 

12.60

 

12.33

 

12.02

 

Total Capital (to Risk Weighted Assets)

13.90

 

13.64

 

13.69

 

13.58

 

13.27

 

Tier 1 Leverage (to Adjusted Total Assets)

9.37

 

9.26

 

9.24

 

8.66

 

8.51

 

(1)

Refer to Explanation of Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure.

(2)

Interim period ratios are calculated on an annualized basis.

(3)

Nonperforming loans consist of all nonaccrual loans and accruing loans that are 90 days or more past due.

(4)

Noncurrent loans consist of nonaccrual loans and accruing loans that are 90 days or more past due.

(5)

Delinquent loans consist of accruing loans that are 30 days or more past due.

(6)

Nonperforming assets consist of nonperforming loans and other real estate owned.

(7)

Capital ratios are for Community Bank only.

 

Certain items previously reported may have been reclassified to conform with the current reporting period’s format.

AVERAGE BALANCES AND YIELDS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

September 30, 2023

 

June 30, 2023

 

March 31, 2023

 

December 31, 2022

 

September 30, 2022

 

Average Balance

Interest and Dividends

 

Yield / Cost (1)

 

Average Balance

Interest and Dividends

 

Yield / Cost (1)

 

Average Balance

Interest and Dividends

 

Yield / Cost (1)

 

Average Balance

Interest and Dividends

 

Yield / Cost (1)

 

Average Balance

Interest and Dividends

 

Yield / Cost (1)

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-Earning Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, Net (2)

$

1,088,691

$

14,081

 

5.13

%

 

$

1,079,399

$

13,450

 

5.00

%

 

$

1,040,570

$

12,391

 

4.83

%

 

$

1,034,714

$

11,853

 

4.54

%

 

$

1,024,363

$

10,833

 

4.20

%

Debt Securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

204,848

 

940

 

1.84

 

 

 

209,292

 

950

 

1.82

 

 

 

213,158

 

964

 

1.81

 

 

 

216,915

 

974

 

1.80

 

 

 

222,110

 

985

 

1.77

 

Exempt From Federal Tax

 

6,013

 

52

 

3.46

 

 

 

6,180

 

53

 

3.43

 

 

 

6,270

 

52

 

3.32

 

 

 

6,277

 

51

 

3.25

 

 

 

7,998

 

62

 

3.10

 

Equity Securities

 

2,693

 

25

 

3.71

 

 

 

2,693

 

25

 

3.71

 

 

 

2,693

 

24

 

3.56

 

 

 

2,693

 

28

 

4.16

 

 

 

2,693

 

21

 

3.12

 

Interest-Earning Deposits at Banks

 

52,642

 

750

 

5.70

 

 

 

54,466

 

721

 

5.30

 

 

 

74,555

 

805

 

4.32

 

 

 

99,108

 

939

 

3.79

 

 

 

67,870

 

378

 

2.23

 

Other Interest-Earning Assets

 

3,292

 

69

 

8.32

 

 

 

2,783

 

39

 

5.62

 

 

 

2,633

 

39

 

6.01

 

 

 

2,875

 

39

 

5.38

 

 

 

2,784

 

39

 

5.56

 

Total Interest-Earning Assets

 

1,358,179

 

15,917

 

4.65

 

 

 

1,354,813

 

15,238

 

4.51

 

 

 

1,339,879

 

14,275

 

4.32

 

 

 

1,362,582

 

13,884

 

4.04

 

 

 

1,327,818

 

12,318

 

3.68

 

Noninterest-Earning Assets

 

52,709

 

 

 

 

 

51,928

 

 

 

 

 

48,369

 

 

 

 

 

51,718

 

 

 

 

 

68,796

 

 

 

Total Assets

$

1,410,888

 

 

 

 

$

1,406,741

 

 

 

 

$

1,388,248

 

 

 

 

$

1,414,300

 

 

 

 

$

1,396,614

 

 

 

Liabilities and Stockholders' Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Demand Accounts

$

363,997

$

2,003

 

2.18

%

 

$

354,497

$

1,582

 

1.79

%

 

$

335,327

$

1,191

 

1.44

%

 

$

315,352

$

810

 

1.02

%

 

$

278,412

$

393

 

0.56

%

Savings Accounts

 

212,909

 

54

 

0.10

 

 

 

225,175

 

53

 

0.09

 

 

 

242,298

 

37

 

0.06

 

 

 

249,948

 

29

 

0.05

 

 

 

251,148

 

20

 

0.03

 

Money Market Accounts

 

187,012

 

1,141

 

2.42

 

 

 

194,565

 

1,033

 

2.13

 

 

 

213,443

 

939

 

1.78

 

 

 

206,192

 

604

 

1.16

 

 

 

189,371

 

269

 

0.56

 

Time Deposits

 

173,832

 

1,552

 

3.54

 

 

 

155,867

 

1,174

 

3.02

 

 

 

101,147

 

337

 

1.35

 

 

 

116,172

 

368

 

1.26

 

 

 

123,438

 

397

 

1.28

 

Total Interest-Bearing Deposits

 

937,750

 

4,750

 

2.01

 

 

 

930,104

 

3,842

 

1.66

 

 

 

892,215

 

2,504

 

1.14

 

 

 

887,664

 

1,811

 

0.81

 

 

 

842,369

 

1,079

 

0.51

 

Short-Term Borrowings

 

 

 

 

 

 

480

 

3

 

2.51

 

 

 

1,344

 

2

 

0.60

 

 

 

8,985

 

7

 

0.31

 

 

 

28,738

 

19

 

0.26

 

Other Borrowings

 

34,662

 

407

 

4.66

 

 

 

21,026

 

238

 

4.54

 

 

 

14,641

 

155

 

4.29

 

 

 

17,598

 

171

 

3.86

 

 

 

17,621

 

174

 

3.92

 

Total Interest-Bearing Liabilities

 

972,412

 

5,157

 

2.10

 

 

 

951,610

 

4,083

 

1.72

 

 

 

908,200

 

2,661

 

1.19

 

 

 

914,247

 

1,989

 

0.86

 

 

 

888,728

 

1,272

 

0.57

 

Noninterest-Bearing Demand Deposits

 

312,016

 

 

 

 

 

326,262

 

 

 

 

 

362,343

 

 

 

 

 

391,300

 

 

 

 

 

390,658

 

 

 

Other Liabilities

 

9,025

 

 

 

 

 

10,920

 

 

 

 

 

2,953

 

 

 

 

 

788

 

 

 

 

 

2,636

 

 

 

Total Liabilities

 

1,293,453

 

 

 

 

 

1,288,792

 

 

 

 

 

1,273,496

 

 

 

 

 

1,306,335

 

 

 

 

 

1,282,022

 

 

 

Stockholders' Equity

 

117,435

 

 

 

 

 

117,949

 

 

 

 

 

114,752

 

 

 

 

 

107,965

 

 

 

 

 

114,592

 

 

 

Total Liabilities and Stockholders' Equity

$

1,410,888

 

 

 

 

$

1,406,741

 

 

 

 

$

1,388,248

 

 

 

 

$

1,414,300

 

 

 

 

$

1,396,614

 

 

 

Net Interest Income (FTE)

(Non-GAAP) (3)

 

$

10,760

 

 

 

 

$

11,155

 

 

 

 

$

11,614

 

 

 

 

$

11,895

 

 

 

 

$

11,046

 

 

Net Interest-Earning Assets (4)

 

385,767

 

 

 

 

 

403,203

 

 

 

 

 

431,679

 

 

 

 

 

448,335

 

 

 

 

 

439,090

 

 

 

Net Interest Rate Spread (FTE)

(Non-GAAP) (3) (5)

 

 

 

2.55

%

 

 

 

 

2.79

%

 

 

 

 

3.13

%

 

 

 

 

3.18

%

 

 

 

 

3.11

%

Net Interest Margin (FTE)

(Non-GAAP) (3)(6)

 

 

 

3.14

 

 

 

 

 

3.30

 

 

 

 

 

3.52

 

 

 

 

 

3.46

 

 

 

 

 

3.30

 

PPP Loans

 

24

 

1

 

16.53

 

 

 

38

 

1

 

10.56

 

 

 

100

 

3

 

12.17

 

 

 

216

 

22

 

40.41

 

 

 

2,424

 

123

 

20.13

 

(1)

Annualized based on three months ended results.

(2)

Net of the allowance for credit losses and includes nonaccrual loans with a zero yield.

(3)

Refer to Explanation and Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure.

(4)

Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(5)

Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(6)

Net interest margin represents annualized net interest income divided by average total interest-earning assets.

AVERAGE BALANCES AND YIELDS

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

September 30, 2023

 

September 30, 2022

 

Average Balance

 

Interest and Dividends

 

Yield /Cost (1)

 

Average Balance

 

Interest and Dividends

 

Yield / Cost (1)

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

Interest-Earning Assets:

 

 

 

 

 

 

 

 

 

 

 

Loans, Net (2)

$

1,069,729

 

$

39,924

 

4.99

%

 

$

1,013,871

 

$

30,157

 

3.98

%

Debt Securities

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

209,069

 

 

2,853

 

1.82

 

 

 

222,132

 

 

2,878

 

1.73

 

Exempt From Federal Tax

 

6,154

 

 

157

 

3.40

 

 

 

9,093

 

 

218

 

3.20

 

Marketable Equity Securities

 

2,693

 

 

74

 

3.66

 

 

 

2,693

 

 

64

 

3.17

 

Interest-Earning Deposits at Banks

 

60,474

 

 

2,276

 

5.02

 

 

 

61,213

 

 

534

 

1.16

 

Other Interest-Earning Assets

 

2,905

 

 

148

 

6.81

 

 

 

3,165

 

 

115

 

4.86

 

Total Interest-Earning Assets

 

1,351,024

 

 

45,432

 

4.50

 

 

 

1,312,167

 

 

33,966

 

3.46

 

Noninterest-Earning Assets

 

51,018

 

 

 

 

 

 

91,607

 

 

 

 

Total Assets

$

1,402,042

 

 

 

 

 

$

1,403,774

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity:

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Demand Accounts

$

351,379

 

$

4,776

 

1.82

%

 

$

271,897

 

$

554

 

0.27

%

Savings Accounts

 

226,686

 

 

145

 

0.09

 

 

 

247,790

 

 

58

 

0.03

 

Money Market Accounts

 

198,243

 

 

3,113

 

2.10

 

 

 

190,189

 

 

371

 

0.26

 

Time Deposits

 

143,881

 

 

3,063

 

2.85

 

 

 

127,732

 

 

1,231

 

1.29

 

Total Interest-Bearing Deposits

 

920,189

 

 

11,097

 

1.61

 

 

 

837,608

 

 

2,214

 

0.35

 

Short-Term Borrowings

 

604

 

 

5

 

1.11

 

 

 

33,553

 

 

56

 

0.22

 

Other Borrowings

 

23,516

 

 

800

 

4.55

 

 

 

17,612

 

 

522

 

3.96

 

Total Interest-Bearing Liabilities

 

944,309

 

 

11,902

 

1.69

 

 

 

888,773

 

 

2,792

 

0.42

 

Noninterest-Bearing Demand Deposits

 

333,356

 

 

 

 

 

 

388,964

 

 

 

 

Other Liabilities

 

7,655

 

 

 

 

 

 

5,177

 

 

 

 

Total Liabilities

 

1,285,320

 

 

 

 

 

 

1,282,914

 

 

 

 

Stockholders' Equity

 

116,722

 

 

 

 

 

 

120,860

 

 

 

 

Total Liabilities and Stockholders' Equity

$

1,402,042

 

 

 

 

 

$

1,403,774

 

 

 

 

Net Interest Income (FTE) (Non-GAAP) (3)

 

 

 

33,530

 

 

 

 

 

 

31,174

 

 

Net Interest-Earning Assets (4)

 

406,715

 

 

 

 

 

 

423,394

 

 

 

 

Net Interest Rate Spread (FTE) (Non-GAAP) (3)(5)

 

 

 

 

2.81

%

 

 

 

 

 

3.04

%

Net Interest Margin (FTE) (Non-GAAP) (3)(6)

 

 

 

 

3.32

 

 

 

 

 

 

3.18

 

PPP Loans

 

54

 

 

5

 

12.38

 

 

 

7,503

 

 

712

 

12.69

 

(1)

Annualized based on nine months ended results.

(2)

Net of the allowance for credit losses and includes nonaccrual loans with a zero yield.

(3)

Refer to Explanation and Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure.

(4)

Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(5)

Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(6)

Net interest margin represents annualized net interest income divided by average total interest-earning assets.

Explanation of Use of Non-GAAP Financial Measures

In addition to financial measures presented in accordance with generally accepted accounting principles (“GAAP”), we use, and this Press Release contains or references, certain Non-GAAP financial measures. We believe these Non-GAAP financial measures provide useful information in understanding our underlying results of operations or financial position and our business and performance trends as they facilitate comparisons with the performance of other companies in the financial services industry. Non-GAAP adjusted items impacting the Company's financial performance are identified to assist investors in providing a complete understanding of factors and trends affecting the Company’s business and in analyzing the Company’s operating results on the same basis as that applied by management. Although we believe that these Non-GAAP financial measures enhance the understanding of our business and performance, they should not be considered an alternative to GAAP or considered to be more important than financial results determined in accordance with GAAP, nor are they necessarily comparable with similar Non-GAAP measures which may be presented by other companies. Where Non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found herein.

 

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

(Dollars in thousands, except share and per share data) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Assets (GAAP)

$

1,399,492

 

$

1,432,733

 

$

1,430,708

 

$

1,408,938

 

$

1,425,920

 

Goodwill and Intangible Assets, Net

 

(11,909

)

 

(12,354

)

 

(12,800

)

 

(13,245

)

 

(13,691

)

Tangible Assets (Non-GAAP) (Numerator)

$

1,387,583

 

$

1,420,379

 

$

1,417,908

 

$

1,395,693

 

$

1,412,229

 

 

 

 

 

 

 

Stockholders' Equity (GAAP)

$

114,846

 

$

116,589

 

$

117,195

 

$

110,155

 

$

106,706

 

Goodwill and Intangible Assets, Net

 

(11,909

)

 

(12,354

)

 

(12,800

)

 

(13,245

)

 

(13,691

)

Tangible Common Equity or Tangible Book Value (Non-GAAP) (Denominator)

$

102,937

 

$

104,235

 

$

104,395

 

$

96,910

 

$

93,015

 

 

 

 

 

 

 

Stockholders’ Equity to Assets (GAAP)

 

8.2

%

 

8.1

%

 

8.2

%

 

7.8

%

 

7.5

%

Tangible Common Equity to Tangible Assets (Non-GAAP)

 

7.4

%

 

7.3

%

 

7.4

%

 

6.9

%

 

6.6

%

 

 

 

 

 

 

Common Shares Outstanding (Denominator)

 

5,120,678

 

 

5,111,678

 

 

5,116,830

 

 

5,100,189

 

 

5,096,672

 

 

 

 

 

 

 

Book Value per Common Share (GAAP)

$

22.43

 

$

22.81

 

$

22.90

 

$

21.60

 

$

20.94

 

Tangible Book Value per Common Share (Non-GAAP)

$

20.10

 

$

20.39

 

$

20.40

 

$

19.00

 

$

18.25

 

 

Three Months Ended

Nine Months Ended

 

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

9/30/23

9/30/22

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (GAAP)

$

2,672

 

$

2,757

 

$

4,156

 

$

4,152

 

$

3,929

 

$

9,586

 

$

7,094

 

Amortization of Intangible Assets, Net

 

445

 

 

446

 

 

445

 

 

446

 

 

445

 

 

1,336

 

 

1,336

 

Adjusted Net Income (Non-GAAP) (Numerator)

$

3,117

 

$

3,203

 

$

4,601

 

$

4,598

 

$

4,374

 

$

10,922

 

$

8,430

 

 

 

 

 

 

 

 

 

Annualization Factor

 

3.97

 

 

4.01

 

 

4.06

 

 

3.97

 

 

3.97

 

 

1.34

 

 

1.34

 

 

 

 

 

 

 

 

 

Average Stockholders' Equity (GAAP)

$

117,435

 

$

117,949

 

$

114,752

 

$

107,965

 

$

114,592

 

$

116,722

 

$

120,860

 

Average Goodwill and Intangible Assets, Net

 

(12,185

)

 

(12,626

)

 

(13,080

)

 

(13,534

)

 

(13,968

)

 

(12,627

)

 

(14,414

)

Average Tangible Common Equity (Non-GAAP) (Denominator)

$

105,250

 

$

105,323

 

$

101,672

 

$

94,431

 

$

100,624

 

$

104,095

 

$

106,446

 

 

 

 

 

 

 

 

 

Return on Average Equity (GAAP)

 

9.03

%

 

9.38

%

 

14.69

%

 

15.26

%

 

13.60

%

 

10.98

%

 

7.85

%

Return on Average Tangible Common Equity (Non-GAAP)

 

11.75

%

 

12.20

%

 

18.35

%

 

19.32

%

 

17.25

%

 

14.03

%

 

10.59

%

 

Three Months Ended

Nine Months Ended

 

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

9/30/23

9/30/22

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Income (GAAP)

$

15,874

 

$

15,203

 

$

14,244

 

$

13,855

 

$

12,287

 

$

45,321

 

$

33,861

 

Adjustment to FTE Basis

 

43

 

 

35

 

 

31

 

 

29

 

 

31

 

 

111

 

 

105

 

Interest Income (FTE) (Non-GAAP)

 

15,917

 

 

15,238

 

 

14,275

 

 

13,884

 

 

12,318

 

 

45,432

 

 

33,966

 

Interest Expense (GAAP)

 

5,157

 

 

4,083

 

 

2,661

 

 

1,989

 

 

1,272

 

 

11,902

 

 

2,792

 

Net Interest Income (FTE) (Non-GAAP)

$

10,760

 

$

11,155

 

$

11,614

 

$

11,895

 

$

11,046

 

$

33,530

 

$

31,174

 

 

 

 

 

 

 

 

 

Net Interest Rate Spread (GAAP)

 

2.54

%

 

2.78

%

 

3.12

%

 

3.17

%

 

3.10

%

 

2.80

%

 

3.03

%

Adjustment to FTE Basis

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

Net Interest Rate Spread (FTE) (Non-GAAP)

 

2.55

%

 

2.79

%

 

3.13

%

 

3.18

%

 

3.11

%

 

2.81

%

 

3.04

%

 

 

 

 

 

 

 

 

Net Interest Margin (GAAP)

 

3.13

%

 

3.29

%

 

3.51

%

 

3.45

%

 

3.29

%

 

3.31

%

 

3.17

%

Adjustment to FTE Basis

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

Net Interest Margin (FTE) (Non-GAAP)

 

3.14

%

 

3.30

%

 

3.52

%

 

3.46

%

 

3.30

%

 

3.32

%

 

3.18

%

 

Three Months Ended

Nine Months Ended

 

9/30/23

6/30/23

3/31/23

12/31/22

9/30/22

9/30/23

9/30/22

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Before Income Tax Expense (GAAP)

$

3,236

 

$

3,456

 

$

5,285

 

$

5,228

 

$

4,927

 

$

11,978

 

$

8,851

 

Provision for Credit Losses

 

291

 

 

492

 

 

80

 

 

 

 

 

 

863

 

 

3,784

 

PPNR (Non-GAAP) (Numerator)

$

3,527

 

$

3,948

 

$

5,365

 

$

5,228

 

$

4,927

 

$

12,841

 

$

12,635

 

 

 

 

 

 

 

 

 

Annualization Factor

 

3.97

 

 

4.01

 

 

4.06

 

 

3.97

 

 

3.97

 

 

1.34

 

 

1.34

 

 

 

 

 

 

 

 

 

Average Assets (Denominator)

$

1,410,888

 

$

1,406,741

 

$

1,388,248

 

$

1,414,300

 

$

1,396,614

 

$

1,402,042

 

$

1,403,774

 

 

 

 

 

 

 

 

 

PPNR Return on Average Assets (Non-GAAP)

 

0.99

%

 

1.13

%

 

1.57

%

 

1.47

%

 

1.40

%

 

1.22

%

 

1.20

%

 

Contacts

John H. Montgomery

President and Chief Executive Officer

Phone: (724) 225-2400

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