Financial News

CB Financial Services, Inc. Announces Second 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 second quarter and year-to-date 2023 financial results.

2023 Second Quarter Financial Highlights

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

  • Net income was $2.8 million, compared to $118,000. Prior period results were negatively impacted by provision for credit losses expense of approximately $3.8 million due primarily to a single commercial loan charge-off of $2.7 million. Current period results were positively impacted by net interest margin (NIM) expansion coupled with a modest increase in noninterest income, partially offset by an increase in noninterest expense.
    • Income before income tax expense (benefit) was $3.5 million compared to $74,000.
    • Pre-provision net revenue (PPNR) (non-GAAP) was $3.95 million compared to $3.86 million.
  • Earnings per diluted common share (EPS) increased to $0.54 from $0.02.
  • Return on average assets (annualized) was 0.79%, compared to 0.03%.
  • Return on average equity (annualized) was 9.38%, compared to 0.40%.
  • NIM improved to 3.29% from 3.12%.
  • Net interest and dividend income was $11.1 million, compared to $10.2 million.
  • Noninterest income increased to $2.3 million, compared to $2.1 million. The most significant changes in noninterest income included an increase in insurance commissions of $142,000 and a decrease in net losses on securities of $99,000.
  • Noninterest expense increased to $9.5 million, compared to $8.4 million, primarily due to increases in compensation and benefits, equipment and data processing costs.

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

  • Total assets increased to $1.43 billion from $1.41 billion.
  • Total loans increased $51.3 million, or 4.9%, to $1.10 billion compared to $1.05 billion, and included increases of $32.2 million, or 46.0%, in commercial and industrial loans, $21.8 million, or 5.0%, in commercial real estate loans, and $7.8 million, or 2.3%, in residential mortgage loans, partially offset by a decrease of $12.1 million, or 8.3%, in consumer loans, which is primarily comprised of indirect automobile loans.
  • Nonperforming loans to total loans was 0.37%, a decrease of 18 basis points (“bps”), compared to 0.55%.
  • Total deposits were $1.26 billion, a decrease of $5.2 million, compared to $1.27 billion.
  • Book value per share was $22.81, compared to $22.90 as of March 31, 2023 and $21.60 as of December 31, 2022.
  • Tangible book value per share (Non-GAAP) was $20.39, compared to $20.40 as of March 31, 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 $6.9 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 $2.6 million.

Management Commentary

President and CEO John H. Montgomery stated, “Our second quarter results demonstrated the durability of both our franchise and the community bank model in general. While macro dislocations seen in the banking industry during the first quarter have abated, we continue to face headwinds resulting from a rising interest rate environment. First and foremost, we are focused on ensuring the bank maintains adequate liquidity and a strong capital position. In doing so, we are able to navigate challenging economic times from a position of strength which also allows us to maintain relationships with trusted customers and develop new ones, as evidenced by our continued loan growth during the quarter. The markets we serve in southwestern Pennsylvania, eastern Ohio and northern West Virginia have remained resilient despite continued interest rate increases by the Federal Reserve. In recent years, our markets have exhibited more stability than others in key areas such as real estate values and employment, allowing Community Bank to experience less volatility.”

Mr. Montgomery continued, “We have noted for several quarters that our funding costs have been rising, with net interest margin decreasing from first quarter levels while improving compared with the second quarter last year. As we highlighted last quarter, our deposit base is well-diversified, with a significant majority insured or collateralized. Within our deposit base, the most significant change during the second quarter was a shift to interest-bearing from noninterest-bearing deposits as our customers responded to the overall increase in market interest rates. The other half of our NIM calculation is our interest income, which has been supported by the repricing of variable rate loans and the addition of new, higher priced loans via the continued growth of our loan book during the second quarter, with C&I loans having been the biggest contributor, followed by commercial real estate loans. Moving forward, our NIM will also benefit as we reposition our loan book by reducing transactional indirect auto loans with higher yielding C&I and CRE loans ”

Mr. Montgomery concluded, “As I noted previously, our team here at Community Bank is focused on maintaining solid capital and liquidity positions. Success on those fronts provides a range of positive outcomes for our business that ultimately lead to long-term value creation which benefits all our constituents - shareholders, employees, customers, and our communities at large. While the near-term economic picture remains somewhat muddled, we are also committed to making proper investments in our franchise to position the bank for long-term growth. During the second quarter we added revenue producing members to our team while also continuing to make targeted technology investments necessary for our competitive positioning. We also declared and paid a $0.25 cash dividend during the quarter while allowing our previous share repurchase program to expire. I am proud of our entire team for all their hard work and look forward to our continued success.”

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 August 31, 2023, to stockholders of record as of the close of business on August 15, 2023.

Stock Repurchase Program

On April 21, 2022, CB announced a program to repurchase up to $10.0 million of the Company’s outstanding shares of common stock. The Company purchased a total of 74,656 shares of the Company’s common stock at an average price of $22.38 per share prior to the program expiration on May 1, 2023.

2023 Second Quarter Financial Review

Net Interest and Dividend Income

Net interest and dividend income increased $1.0 million, or 9.4%, to $11.1 million for the three months ended June 30, 2023 compared to $10.2 million for the three months ended June 30, 2022.

  • Net interest margin (GAAP) increased to 3.29% for the three months ended June 30, 2023 compared to 3.12% for the three months ended June 30, 2022. Fully tax equivalent (FTE) net interest margin (Non-GAAP) increased 17 bps to 3.30% for the three months ended June 30, 2023 compared to 3.13% for the three months ended June 30, 2022.
  • Interest and dividend income increased $4.2 million, or 38.7%, to $15.2 million for the three months ended June 30, 2023 compared to $11.0 million for the three months ended June 30, 2022.
    • Interest income on loans increased $3.7 million, or 37.9%, to $13.4 million for the three months ended June 30, 2023 compared to $9.7 million for the three months ended June 30, 2022. The average balance of loans increased $71.5 million to $1.08 billion from $1.01 billion, generating $724,000 of additional interest income on loans. The average yield increased 112 bps to 5.00% compared to 3.88% causing a $3.0 million increase in interest income on loans.
    • Interest income on interest-earning deposits at other banks increased $599,000, to $721,000 for the three months ended June 30, 2023 compared to $122,000 for the three months ended June 30, 2022 as the average yield increased 443 bps, partially offset by a $1.9 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 $3.3 million, or 413.6%, to $4.1 million for the three months ended June 30, 2023 compared to $795,000 for the three months ended June 30, 2022.
    • Interest expense on deposits increased $3.2 million, or 536.1%, to $3.8 million for the three months ended June 30, 2023 compared to $604,000 for the three months ended June 30, 2022. Rising market interest rates led to the repricing of interest-bearing demand and money market deposits and a shift in deposits from non interest-bearing to interest-bearing demand and time deposits and resulted in a 137 bps, or 466.9%, increase in the average cost of interest-bearing deposits compared to the three months ended June 30, 2022. This accounted for a $3.2 million increase in interest expense. Additionally, interest-bearing deposit balances increased $104.5 million, or 12.7%, to $930.1 million as of June 30, 2023 compared to $825.6 million as of June 30, 2022, accounting for a $70,000 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 June 30, 2023 was $432,000 and was required primarily due to loan growth coupled with a modeled slowdown in loan prepayment speeds. This compared to $3.8 million in provision for credit losses recorded for the three months ended June 30, 2022, primarily due to the charge-off of a $2.7 million commercial and industrial loan to a borrower that ceased operations.

Noninterest income

Noninterest income increased $164,000, or 7.8%, to $2.3 million for the three months ended June 30, 2023, compared to $2.1 million for the three months ended June 30, 2022. This increase was primarily related to a $142,000 increase in commercial and personal insurance commissions and a decrease in net losses on securities of $99,000.

Noninterest Expense

Noninterest expense increased $1.1 million, or 13.0%, to $9.5 million for the three months ended June 30, 2023 compared to $8.4 million for the three months ended June 30, 2022. Salaries and benefits increased $692,000, or 15.2%, to $5.2 million primarily due to merit increases, revenue producing staff additions and associated $160,000 of recruiting costs, and $96,000 of severance costs related to the discontinuation of indirect automobile lending. Data processing expense increased $272,000, or 61.0%, to $718,000, due to increased ongoing costs related to the fourth quarter 2022 core conversion and equipment expense increased $101,000 or 55.5%, to $283,000, due to costs associated with the implementation of new interactive teller machines.

Statement of Financial Condition Review

Assets

Total assets increased $23.8 million, or 1.7%, to $1.43 billion at June 30, 2023, compared to $1.41 billion at December 31, 2022.

  • Cash and due from banks decreased $25.6 million, or 24.7%, to $78.1 million at June 30, 2023, compared to $103.7 million at December 31, 2022, due to significant loan growth.
  • Securities decreased $8.6 million, or 4.5%, to $181.4 million at June 30, 2023, compared to $190.1 million at December 31, 2022. The securities balance was primarily impacted by $8.1 million of repayments on mortgage-backed and collateralized mortgage obligation securities and a $332,000 decrease in the market value in the equity securities portfolio, which is primarily comprised of bank stocks. 

Loans and Credit Quality

  • Total loans increased $51.3 million, or 4.9%, to $1.10 billion at June 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 $32.2 million, $21.8 million, and $7.8 million, respectively, partially offset by a decrease in consumer loans of $12.1 million. The decrease in consumer loans resulted from a reduction in indirect automobile loan production due to rising market interest rates. Further decreases in this portfolio is expected as the Bank discontinued this product offering at June 30, 2023 to allocate resources and focus production efforts on more profitable commercial products.
  • The allowance for credit losses (ACL) was $10.7 million at June 30, 2023 and $12.8 million at December 31, 2022. As a result, the ACL to total loans was 0.97% at June 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 current expected credit loss (CECL) activity using a forecast approach.
  • Net charge-offs for the three months ended June 30, 2023 were $96,000, or 0.04% of average loans on an annualized basis. Net charge-offs for the three months ended June 30, 2022 were $2.5 million, or 1.01% of average loans on an annualized basis primarily due to the aforementioned $2.7 million charge-off of a commercial and industrial loan. Net recoveries for the six months ended June 30, 2023 were $660,000 primarily due to recoveries totaling $750,000 related to the prior year charged-off loan. Net charge-offs for the six months ended June 30, 2022 were $2.5 million.
  • Nonperforming loans, which includes nonaccrual loans and accruing loans past due 90 days or more, were $4.1 million at June 30, 2023 compared to $5.8 million at December 31, 2022. The decrease of $1.7 million was due to ten loans totaling $1.7 million being moved from nonaccrual to accrual status during the current period. Current nonperforming loans to total loans ratio was 0.37% compared to 0.55% at December 31, 2022. 

Other

  • Intangible assets decreased $891,000, or 25.6%, to $2.6 million at June 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 $5.6 million, or 26.8%, to $26.7 million at June 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 the end of the period, and increases in accounts receivable for EU, income taxes receivable and BOLI death benefit claims receivable $853,000, $761,000 and $664,000.

Total liabilities increased $17.4 million, or 1.3%, to $1.32 billion at June 30, 2023 compared to $1.30 billion at December 31, 2022.

Deposits

  • Total deposits decreased $5.2 million to $1.26 billion as of June 30, 2023 compared to $1.27 billion at December 31, 2022. Interest-bearing demand deposits increased $62.8 million and time deposits increased $60.4 million, while non interest-bearing demand deposits decreased $74.3 million, money market deposits decreased $23.3 million and savings deposits decreased $30.8 million. The increase in interest-bearing demand deposits is 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 61.1% of total deposits while an additional 16.5% of deposits were collateralized with investment securities.

Borrowed Funds

  • Long-term borrowings increased $20.0 million, or 136.6%, to $34.7 million at June 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 June 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 $10.6 million, or 139.8%, to $18.2 million at June 30, 2023, compared to $7.6 million at December 31, 2022 primarily due to the purchase of $8.9 million of syndicated loans which were unfunded at the end of the period.

Stockholders’ Equity

Stockholders’ equity increased $6.4 million, or 5.8%, to $116.6 million at June 30, 2023, compared to $110.2 million at December 31, 2022. Key factors positively impacting stockholders’ equity included $6.9 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 $2.6 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 plan. In total, the Company repurchased $274,000 of common stock since December 31, 2022. The plan expired on May 1, 2023.

Book value per share

Book value per common share was $22.81 at June 30, 2023 compared to $21.60 at December 31, 2022, an increase of $1.21.

Tangible book value per common share (Non-GAAP) was $20.39 at June 30, 2023, compared to $19.00 at December 31, 2022, an increase of $1.39.

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

6/30/23

 

3/31/23

 

12/31/22

 

9/30/22

 

6/30/22

Assets

 

 

 

 

 

 

 

 

 

Cash and Due From Banks

$

78,093

 

 

$

103,545

 

 

$

103,700

 

 

$

122,801

 

 

$

81,121

 

Securities

 

181,427

 

 

 

189,025

 

 

 

190,058

 

 

 

193,846

 

 

 

213,505

 

Loans

 

 

 

 

 

 

 

 

 

Real Estate:

 

 

 

 

 

 

 

 

 

Residential

 

338,493

 

 

 

332,840

 

 

 

330,725

 

 

 

328,248

 

 

 

325,138

 

Commercial

 

458,614

 

 

 

452,770

 

 

 

436,805

 

 

 

432,516

 

 

 

426,105

 

Construction

 

44,523

 

 

 

39,522

 

 

 

44,923

 

 

 

49,502

 

 

 

41,277

 

Commercial and Industrial:

 

 

 

 

 

 

 

 

 

Commercial and Industrial

 

102,232

 

 

 

79,436

 

 

 

69,918

 

 

 

61,428

 

 

 

62,054

 

PPP

 

34

 

 

 

65

 

 

 

126

 

 

 

768

 

 

 

3,853

 

Consumer

 

134,788

 

 

 

146,081

 

 

 

146,927

 

 

 

150,615

 

 

 

148,921

 

Other

 

22,470

 

 

 

21,151

 

 

 

20,449

 

 

 

19,865

 

 

 

20,621

 

Total Loans

 

1,101,154

 

 

 

1,071,865

 

 

 

1,049,873

 

 

 

1,042,942

 

 

 

1,027,969

 

Allowance for Credit Losses

 

(10,666

)

 

 

(10,270

)

 

 

(12,819

)

 

 

(12,854

)

 

 

(12,833

)

Loans, Net

 

1,090,488

 

 

 

1,061,595

 

 

 

1,037,054

 

 

 

1,030,088

 

 

 

1,015,136

 

Premises and Equipment, Net

 

18,582

 

 

 

17,732

 

 

 

17,844

 

 

 

18,064

 

 

 

18,196

 

Bank-Owned Life Insurance

 

25,082

 

 

 

24,943

 

 

 

25,893

 

 

 

25,750

 

 

 

25,610

 

Goodwill

 

9,732

 

 

 

9,732

 

 

 

9,732

 

 

 

9,732

 

 

 

9,732

 

Intangible Assets, Net

 

2,622

 

 

 

3,068

 

 

 

3,513

 

 

 

3,959

 

 

 

4,404

 

Accrued Interest Receivable and Other Assets

 

26,707

 

 

 

21,068

 

 

 

21,144

 

 

 

21,680

 

 

 

18,757

 

Total Assets

$

1,432,733

 

 

$

1,430,708

 

 

$

1,408,938

 

 

$

1,425,920

 

 

$

1,386,461

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

Noninterest-Bearing Demand Accounts

$

316,098

 

 

$

350,911

 

 

$

390,405

 

 

$

407,107

 

 

$

389,127

 

Interest-Bearing Demand Accounts

 

374,654

 

 

 

359,051

 

 

 

311,825

 

 

 

298,755

 

 

 

265,347

 

Money Market Accounts

 

185,814

 

 

 

206,174

 

 

 

209,125

 

 

 

198,715

 

 

 

185,308

 

Savings Accounts

 

217,267

 

 

 

234,935

 

 

 

248,022

 

 

 

250,378

 

 

 

250,226

 

Time Deposits

 

169,482

 

 

 

130,449

 

 

 

109,126

 

 

 

120,879

 

 

 

125,182

 

Total Deposits

 

1,263,315

 

 

 

1,281,520

 

 

 

1,268,503

 

 

 

1,275,834

 

 

 

1,215,190

 

 

 

 

 

 

 

 

 

 

 

Short-Term Borrowings

 

 

 

 

121

 

 

 

8,060

 

 

 

18,108

 

 

 

32,178

 

Other Borrowings

 

34,658

 

 

 

14,648

 

 

 

14,638

 

 

 

17,627

 

 

 

17,618

 

Accrued Interest Payable and Other Liabilities

 

18,171

 

 

 

17,224

 

 

 

7,582

 

 

 

7,645

 

 

 

7,703

 

Total Liabilities

 

1,316,144

 

 

 

1,313,513

 

 

 

1,298,783

 

 

 

1,319,214

 

 

 

1,272,689

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ Equity

 

116,589

 

 

 

117,195

 

 

 

110,155

 

 

 

106,706

 

 

 

113,772

 

Total Liabilities and Stockholders’ Equity

$

1,432,733

 

 

$

1,430,708

 

 

$

1,408,938

 

 

$

1,425,920

 

 

$

1,386,461

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

Three Months Ended

Six Months Ended

Selected Operating Data

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

6/30/23

6/30/22

Interest and Dividend Income:

 

 

 

 

 

 

 

Loans, Including Fees

$

13,426

 

$

12,371

 

$

11,835

 

$

10,815

 

$

9,733

 

$

25,797

 

$

19,284

 

Securities:

 

 

 

 

 

 

 

Taxable

 

950

 

 

964

 

 

974

 

 

985

 

 

988

 

 

1,914

 

 

1,893

 

Tax-Exempt

 

42

 

 

41

 

 

40

 

 

49

 

 

57

 

 

83

 

 

123

 

Dividends

 

25

 

 

24

 

 

28

 

 

21

 

 

20

 

 

49

 

 

42

 

Other Interest and Dividend Income

 

760

 

 

844

 

 

978

 

 

417

 

 

160

 

 

1,605

 

 

232

 

Total Interest and Dividend Income

 

15,203

 

 

14,244

 

 

13,855

 

 

12,287

 

 

10,958

 

 

29,448

 

 

21,574

 

Interest Expense:

 

 

 

 

 

 

 

Deposits

 

3,842

 

 

2,504

 

 

1,811

 

 

1,079

 

 

604

 

 

6,346

 

 

1,134

 

Short-Term Borrowings

 

3

 

 

2

 

 

7

 

 

19

 

 

18

 

 

5

 

 

37

 

Other Borrowings

 

238

 

 

155

 

 

171

 

 

174

 

 

173

 

 

393

 

 

347

 

Total Interest Expense

 

4,083

 

 

2,661

 

 

1,989

 

 

1,272

 

 

795

 

 

6,744

 

 

1,518

 

Net Interest and Dividend Income

 

11,120

 

 

11,583

 

 

11,866

 

 

11,015

 

 

10,163

 

 

22,704

 

 

20,056

 

Provision for Credit Losses - Loans

 

492

 

 

80

 

 

 

 

 

 

3,784

 

 

572

 

 

3,784

 

Recovery for Credit Losses - Unfunded Commitments

 

(60

)

 

 

 

 

 

 

 

 

 

(60

)

 

 

Net Interest and Dividend Income After Provision for Credit Losses

 

10,688

 

 

11,503

 

 

11,866

 

 

11,015

 

 

6,379

 

 

22,192

 

 

16,272

 

Noninterest Income:

 

 

 

 

 

 

 

Service Fees

 

448

 

 

445

 

 

530

 

 

544

 

 

559

 

 

892

 

 

1,085

 

Insurance Commissions

 

1,511

 

 

1,922

 

 

1,399

 

 

1,368

 

 

1,369

 

 

3,434

 

 

3,167

 

Other Commissions

 

224

 

 

144

 

 

157

 

 

244

 

 

179

 

 

368

 

 

268

 

Net (Loss) Gain on Sales of Loans

 

(5

)

 

2

 

 

 

 

 

 

 

 

(3

)

 

 

Net (Loss) Gain on Securities

 

(100

)

 

(232

)

 

83

 

 

(46

)

 

(199

)

 

(332

)

 

(206

)

Net Gain on Purchased Tax Credits

 

7

 

 

7

 

 

14

 

 

14

 

 

14

 

 

14

 

 

28

 

Net Gain (Loss) on Disposal of Fixed Assets

 

 

 

11

 

 

 

 

439

 

 

 

 

11

 

 

(8

)

Income from Bank-Owned Life Insurance

 

139

 

 

140

 

 

143

 

 

140

 

 

142

 

 

280

 

 

278

 

Net Gain on Bank-Owned Life Insurance Claims

 

1

 

 

302

 

 

 

 

 

 

 

 

303

 

 

 

Other Income

 

44

 

 

69

 

 

34

 

 

36

 

 

41

 

 

113

 

 

106

 

Total Noninterest Income

 

2,269

 

 

2,810

 

 

2,360

 

 

2,739

 

 

2,105

 

 

5,080

 

 

4,718

 

Noninterest Expense:

 

 

 

 

 

 

 

Salaries and Employee Benefits

 

5,231

 

 

5,079

 

 

4,625

 

 

4,739

 

 

4,539

 

 

10,310

 

 

9,104

 

Occupancy

 

789

 

 

701

 

 

817

 

 

768

 

 

776

 

 

1,490

 

 

1,462

 

Equipment

 

283

 

 

218

 

 

178

 

 

170

 

 

182

 

 

501

 

 

392

 

Data Processing

 

718

 

 

857

 

 

681

 

 

540

 

 

446

 

 

1,575

 

 

931

 

FDIC Assessment

 

224

 

 

152

 

 

154

 

 

147

 

 

128

 

 

376

 

 

337

 

PA Shares Tax

 

195

 

 

260

 

 

258

 

 

240

 

 

240

 

 

455

 

 

480

 

Contracted Services

 

434

 

 

147

 

 

405

 

 

288

 

 

348

 

 

581

 

 

935

 

Legal and Professional Fees

 

246

 

 

182

 

 

362

 

 

334

 

 

389

 

 

428

 

 

541

 

Advertising

 

75

 

 

79

 

 

165

 

 

131

 

 

115

 

 

154

 

 

231

 

Other Real Estate Owned (Income)

 

(35

)

 

(37

)

 

(38

)

 

(38

)

 

(37

)

 

(72

)

 

(75

)

Amortization of Intangible Assets

 

446

 

 

445

 

 

446

 

 

445

 

 

446

 

 

891

 

 

891

 

Other

 

895

 

 

945

 

 

945

 

 

1,063

 

 

838

 

 

1,841

 

 

1,837

 

Total Noninterest Expense

 

9,501

 

 

9,028

 

 

8,998

 

 

8,827

 

 

8,410

 

 

18,530

 

 

17,066

 

Income Before Income Tax Expense (Benefit)

 

3,456

 

 

5,285

 

 

5,228

 

 

4,927

 

 

74

 

 

8,742

 

 

3,924

 

Income Tax Expense (Benefit)

 

699

 

 

1,129

 

 

1,076

 

 

998

 

 

(44

)

 

1,827

 

 

759

 

Net Income

$

2,757

 

$

4,156

 

$

4,152

 

$

3,929

 

$

118

 

$

6,915

 

$

3,165

 

 

Three Months Ended

Six Months Ended

Per Common Share Data

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

6/30/23

6/30/22

Dividends Per Common Share

$

0.25

$

0.25

$

0.24

$

0.24

$

0.24

$

0.50

$

0.48

Earnings Per Common Share - Basic

 

0.54

 

0.81

 

0.81

 

0.77

 

0.02

 

1.35

 

0.61

Earnings Per Common Share - Diluted

 

0.54

 

0.81

 

0.81

 

0.77

 

0.02

 

1.35

 

0.61

 

 

 

 

 

 

 

 

Weighted Average Common Shares Outstanding - Basic

 

5,111,987

 

5,109,597

 

5,095,237

 

5,106,861

 

5,147,846

 

5,110,799

 

5,172,881

Weighted Average Common Shares Outstanding - Diluted

 

5,116,134

 

5,115,705

 

5,104,254

 

5,118,627

 

5,156,975

 

5,118,396

 

5,189,144

 

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

Common Shares Outstanding

 

5,111,678

 

 

5,116,830

 

 

5,100,189

 

 

5,096,672

 

 

5,128,333

 

Book Value Per Common Share

$

22.81

 

$

22.90

 

$

21.60

 

$

20.94

 

$

22.18

 

Tangible Book Value per Common Share (1)

 

20.39

 

 

20.40

 

 

19.00

 

 

18.25

 

 

19.43

 

Stockholders’ Equity to Assets

 

8.1

%

 

8.2

%

 

7.8

%

 

7.5

%

 

8.2

%

Tangible Common Equity to Tangible Assets (1)

 

7.3

 

 

7.4

 

 

6.9

 

 

6.6

 

 

7.3

 

 

Three Months Ended

Six Months Ended

Selected Financial Ratios (2)

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

6/30/23

6/30/22

Return on Average Assets

0.79

%

1.21

%

1.16

%

1.12

%

0.03

%

1.00

%

0.45

%

Return on Average Equity

9.38

 

14.69

 

15.26

 

13.60

 

0.40

 

11.98

 

5.15

 

Average Interest-Earning Assets to Average Interest-Bearing Liabilities

142.37

 

147.53

 

149.04

 

149.41

 

149.03

 

144.88

 

146.74

 

Average Equity to Average Assets

8.38

 

8.27

 

7.63

 

8.20

 

8.49

 

8.33

 

8.81

 

Net Interest Rate Spread

2.78

 

3.12

 

3.17

 

3.10

 

3.00

 

2.95

 

3.00

 

Net Interest Rate Spread (FTE) (1)

2.79

 

3.13

 

3.18

 

3.11

 

3.01

 

2.96

 

3.01

 

Net Interest Margin

3.29

 

3.51

 

3.45

 

3.29

 

3.12

 

3.40

 

3.10

 

Net Interest Margin (FTE) (1)

3.30

 

3.52

 

3.46

 

3.30

 

3.13

 

3.41

 

3.11

 

Net Charge-Offs (Recoveries) to Average Loans

0.04

 

(0.29

)

0.01

 

(0.01

)

1.01

 

(0.12

)

0.50

 

Efficiency Ratio

70.96

 

62.72

 

63.25

 

64.18

 

68.55

 

66.69

 

68.89

 

Asset Quality Ratios

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

Allowance for Credit Losses to Total Loans

0.97

%

0.96

%

1.22

%

1.23

%

1.25

%

Allowance for Credit Losses to Nonperforming Loans (3)

260.46

 

189.73

 

221.06

 

218.61

 

219.89

 

Allowance for Credit Losses to Noncurrent Loans (4)

260.46

 

189.73

 

320.64

 

318.96

 

329.47

 

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

0.68

 

1.02

 

0.81

 

0.46

 

0.45

 

Nonperforming Loans to Total Loans (3)

0.37

 

0.51

 

0.55

 

0.56

 

0.57

 

Noncurrent Loans to Total Loans (4)

0.37

 

0.51

 

0.38

 

0.39

 

0.38

 

Nonperforming Assets to Total Assets (6)

0.30

 

0.40

 

0.41

 

0.41

 

0.42

 

Capital Ratios (7)

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

Common Equity Tier 1 Capital (to Risk Weighted Assets)

12.54

%

12.60

%

12.33

%

12.02

%

11.83

%

Tier 1 Capital (to Risk Weighted Assets)

12.54

 

12.60

 

12.33

 

12.02

 

11.83

 

Total Capital (to Risk Weighted Assets)

13.64

 

13.69

 

13.58

 

13.27

 

13.08

 

Tier 1 Leverage (to Adjusted Total Assets)

9.26

 

9.24

 

8.66

 

8.51

 

8.33

 

(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

 

June 30, 2023

 

March 31, 2023

 

December 31, 2022

 

September 30, 2022

 

June 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)

$

1,079,399

$

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

%

 

$

1,007,874

$

9,751

3.88

%

Debt Securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

209,292

 

950

1.82

 

 

 

213,158

 

964

1.81

 

 

 

216,915

 

974

1.80

 

 

 

222,110

 

985

1.77

 

 

 

228,315

 

988

1.73

 

Exempt From Federal Tax

 

6,180

 

53

3.43

 

 

 

6,270

 

52

3.32

 

 

 

6,277

 

51

3.25

 

 

 

7,998

 

62

3.10

 

 

 

9,109

 

73

3.21

 

Equity Securities

 

2,693

 

25

3.71

 

 

 

2,693

 

24

3.56

 

 

 

2,693

 

28

4.16

 

 

 

2,693

 

21

3.12

 

 

 

2,693

 

20

2.97

 

Interest-Earning Deposits at Banks

 

54,466

 

721

5.30

 

 

 

74,555

 

805

4.32

 

 

 

99,108

 

939

3.79

 

 

 

67,870

 

378

2.23

 

 

 

56,379

 

122

0.87

 

Other Interest-Earning Assets

 

2,783

 

39

5.62

 

 

 

2,633

 

39

6.01

 

 

 

2,875

 

39

5.38

 

 

 

2,784

 

39

5.56

 

 

 

3,235

 

38

4.71

 

Total Interest-Earning Assets

 

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

 

 

 

1,307,605

 

10,992

3.37

 

Noninterest-Earning Assets

 

51,928

 

 

 

 

48,369

 

 

 

 

51,718

 

 

 

 

68,796

 

 

 

 

84,323

 

 

Total Assets

$

1,406,741

 

 

 

$

1,388,248

 

 

 

$

1,414,300

 

 

 

$

1,396,614

 

 

 

$

1,391,928

 

 

Liabilities and Stockholders' Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Demand Accounts

$

354,497

$

1,582

1.79

%

 

$

335,327

$

1,191

1.44

%

 

$

315,352

$

810

1.02

%

 

$

278,412

$

393

0.56

%

 

$

260,655

$

111

0.17

%

Savings Accounts

 

225,175

 

53

0.09

 

 

 

242,298

 

37

0.06

 

 

 

249,948

 

29

0.05

 

 

 

251,148

 

20

0.03

 

 

 

248,356

 

20

0.03

 

Money Market Accounts

 

194,565

 

1,033

2.13

 

 

 

213,443

 

939

1.78

 

 

 

206,192

 

604

1.16

 

 

 

189,371

 

269

0.56

 

 

 

188,804

 

61

0.13

 

Time Deposits

 

155,867

 

1,174

3.02

 

 

 

101,147

 

337

1.35

 

 

 

116,172

 

368

1.26

 

 

 

123,438

 

397

1.28

 

 

 

127,832

 

412

1.29

 

Total Interest-Bearing Deposits

 

930,104

 

3,842

1.66

 

 

 

892,215

 

2,504

1.14

 

 

 

887,664

 

1,811

0.81

 

 

 

842,369

 

1,079

0.51

 

 

 

825,647

 

604

0.29

 

Short-Term Borrowings

 

480

 

3

2.51

 

 

 

1,344

 

2

0.60

 

 

 

8,985

 

7

0.31

 

 

 

28,738

 

19

0.26

 

 

 

34,135

 

18

0.21

 

Other Borrowings

 

21,026

 

238

4.54

 

 

 

14,641

 

155

4.29

 

 

 

17,598

 

171

3.86

 

 

 

17,621

 

174

3.92

 

 

 

17,611

 

173

3.94

 

Total Interest-Bearing Liabilities

 

951,610

 

4,083

1.72

 

 

 

908,200

 

2,661

1.19

 

 

 

914,247

 

1,989

0.86

 

 

 

888,728

 

1,272

0.57

 

 

 

877,393

 

795

0.36

 

Noninterest-Bearing Demand Deposits

 

326,262

 

 

 

 

362,343

 

 

 

 

391,300

 

 

 

 

390,658

 

 

 

 

391,975

 

 

Other Liabilities

 

10,920

 

 

 

 

2,953

 

 

 

 

788

 

 

 

 

2,636

 

 

 

 

4,415

 

 

Total Liabilities

 

1,288,792

 

 

 

 

1,273,496

 

 

 

 

1,306,335

 

 

 

 

1,282,022

 

 

 

 

1,273,783

 

 

Stockholders' Equity

 

117,949

 

 

 

 

114,752

 

 

 

 

107,965

 

 

 

 

114,592

 

 

 

 

118,145

 

 

Total Liabilities and Stockholders' Equity

$

1,406,741

 

 

 

$

1,388,248

 

 

 

$

1,414,300

 

 

 

$

1,396,614

 

 

 

$

1,391,928

 

 

Net Interest Income (FTE)

(Non-GAAP) (3)

 

$

11,155

 

 

 

$

11,614

 

 

 

$

11,895

 

 

 

$

11,046

 

 

 

$

10,197

 

Net Interest-Earning Assets (4)

 

403,203

 

 

 

 

431,679

 

 

 

 

448,335

 

 

 

 

439,090

 

 

 

 

430,212

 

 

Net Interest Rate Spread (FTE)

(Non-GAAP) (3) (5)

 

 

2.79

%

 

 

 

3.13

%

 

 

 

3.18

%

 

 

 

3.11

%

 

 

 

3.01

%

Net Interest Margin (FTE)

(Non-GAAP) (3)(6)

 

 

3.30

 

 

 

 

3.52

 

 

 

 

3.46

 

 

 

 

3.30

 

 

 

 

3.13

 

PPP Loans

 

38

 

1

10.56

 

 

 

100

 

3

12.17

 

 

 

216

 

22

40.41

 

 

 

2,424

 

123

20.13

 

 

 

5,546

 

144

10.41

 

(1)

 

Annualized based on three months ended results.

(2)

 

Net of the allowance for credit losses and includes nonaccrual loans with a zero yield and Loans Held for Sale if applicable.

(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

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 30, 2023

 

June 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)

$

1,060,092

 

$

25,840

 

4.92

%

 

$

1,008,539

 

$

19,322

 

3.86

%

Debt Securities

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

211,213

 

 

1,914

 

1.81

 

 

 

222,144

 

 

1,893

 

1.70

 

Exempt From Federal Tax

 

6,225

 

 

105

 

3.37

 

 

 

9,649

 

 

156

 

3.23

 

Marketable Equity Securities

 

2,693

 

 

49

 

3.64

 

 

 

2,693

 

 

42

 

3.12

 

Interest-Earning Deposits at Banks

 

64,455

 

 

1,526

 

4.74

 

 

 

57,829

 

 

156

 

0.54

 

Other Interest-Earning Assets

 

2,709

 

 

79

 

5.88

 

 

 

3,358

 

 

76

 

4.56

 

Total Interest-Earning Assets

 

1,347,387

 

 

29,513

 

4.42

 

 

 

1,304,212

 

 

21,645

 

3.35

 

Noninterest-Earning Assets

 

50,159

 

 

 

 

 

 

103,201

 

 

 

 

Total Assets

$

1,397,546

 

 

 

 

 

$

1,407,413

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity:

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Interest-Bearing Demand Accounts

$

344,965

 

$

2,773

 

1.62

%

 

$

268,585

 

$

160

 

0.12

%

Savings Accounts

 

233,689

 

 

90

 

0.08

 

 

 

246,084

 

 

38

 

0.03

 

Money Market Accounts

 

203,952

 

 

1,972

 

1.95

 

 

 

190,605

 

 

102

 

0.11

 

Time Deposits

 

128,659

 

 

1,511

 

2.37

 

 

 

129,914

 

 

834

 

1.29

 

Total Interest-Bearing Deposits

 

911,265

 

 

6,346

 

1.40

 

 

 

835,188

 

 

1,134

 

0.27

 

Short-Term Borrowings

 

910

 

 

5

 

1.11

 

 

 

36,000

 

 

37

 

0.21

 

Other Borrowings

 

17,850

 

 

393

 

4.44

 

 

 

17,608

 

 

347

 

3.97

 

Total Interest-Bearing Liabilities

 

930,025

 

 

6,744

 

1.46

 

 

 

888,796

 

 

1,518

 

0.34

 

Noninterest-Bearing Demand Deposits

 

344,203

 

 

 

 

 

 

388,103

 

 

 

 

Other Liabilities

 

6,959

 

 

 

 

 

 

6,468

 

 

 

 

Total Liabilities

 

1,281,187

 

 

 

 

 

 

1,283,367

 

 

 

 

Stockholders' Equity

 

116,359

 

 

 

 

 

 

124,046

 

 

 

 

Total Liabilities and Stockholders' Equity

$

1,397,546

 

 

 

 

 

$

1,407,413

 

 

 

 

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

 

 

 

22,769

 

 

 

 

 

 

20,127

 

 

Net Interest-Earning Assets (4)

 

417,362

 

 

 

 

 

 

415,416

 

 

 

 

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

 

 

 

 

2.96

%

 

 

 

 

 

3.01

%

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

 

 

 

 

3.41

 

 

 

 

 

 

3.11

 

PPP Loans

 

69

 

 

4

 

11.69

 

 

 

10,085

 

 

589

 

11.78

 

(1)

 

Annualized based on six months ended results

(2)

 

Net of the allowance for credit losses and includes nonaccrual loans with a zero yield and Loans Held for Sale if applicable.

(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.

 

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

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

 

 

 

 

 

 

 

 

 

 

 

Assets (GAAP)

$

1,432,733

 

$

1,430,708

 

$

1,408,938

 

$

1,425,920

 

$

1,386,461

 

Goodwill and Intangible Assets, Net

 

(12,354

)

 

(12,800

)

 

(13,245

)

 

(13,691

)

 

(14,136

)

Tangible Assets (Non-GAAP) (Numerator)

$

1,420,379

 

$

1,417,908

 

$

1,395,693

 

$

1,412,229

 

$

1,372,325

 

 

 

 

 

 

 

Stockholders' Equity (GAAP)

$

116,589

 

$

117,195

 

$

110,155

 

$

106,706

 

$

113,772

 

Goodwill and Intangible Assets, Net

 

(12,354

)

 

(12,800

)

 

(13,245

)

 

(13,691

)

 

(14,136

)

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

$

104,235

 

$

104,395

 

$

96,910

 

$

93,015

 

$

99,636

 

 

 

 

 

 

 

Stockholders’ Equity to Assets (GAAP)

 

8.1

%

 

8.2

%

 

7.8

%

 

7.5

%

 

8.2

%

Tangible Common Equity to Tangible Assets (Non-GAAP)

 

7.3

%

 

7.4

%

 

6.9

%

 

6.6

%

 

7.3

%

 

 

 

 

 

 

Common Shares Outstanding (Denominator)

 

5,111,678

 

 

5,116,830

 

 

5,100,189

 

 

5,096,672

 

 

5,128,333

 

 

 

 

 

 

 

Book Value per Common Share (GAAP)

$

22.81

 

$

22.90

 

$

21.60

 

$

20.94

 

$

22.18

 

Tangible Book Value per Common Share (Non-GAAP)

$

20.39

 

$

20.40

 

$

19.00

 

$

18.25

 

$

19.43

 

 

Three Months Ended

Six Months Ended

 

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

6/30/23

6/30/22

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (GAAP)

$

2,757

 

$

4,156

 

$

4,152

 

$

3,929

 

$

118

 

$

6,915

 

$

3,165

 

Amortization of Intangible Assets, Net

 

446

 

 

445

 

 

446

 

 

445

 

 

446

 

 

891

 

 

891

 

Adjusted Net Income (Non-GAAP) (Numerator)

$

3,203

 

$

4,601

 

$

4,598

 

$

4,374

 

$

564

 

$

7,806

 

$

4,056

 

 

 

 

 

 

 

 

 

Annualization Factor

 

4.01

 

 

4.06

 

 

3.97

 

 

3.97

 

 

4.01

 

 

2.02

 

 

2.02

 

 

 

 

 

 

 

 

 

Average Stockholders' Equity (GAAP)

$

117,949

 

$

114,752

 

$

107,965

 

$

114,592

 

$

118,145

 

$

116,359

 

$

124,046

 

Average Goodwill and Intangible Assets, Net

 

(12,626

)

 

(13,080

)

 

(13,534

)

 

(13,968

)

 

(14,414

)

 

(12,852

)

 

(14,641

)

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

$

105,323

 

$

101,672

 

$

94,431

 

$

100,624

 

$

103,731

 

$

103,507

 

$

109,405

 

 

 

 

 

 

 

 

 

Return on Average Equity (GAAP)

 

9.38

%

 

14.69

%

 

15.26

%

 

13.60

%

 

0.40

%

 

11.98

%

 

5.15

%

Return on Average Tangible Common Equity (Non-GAAP)

 

12.20

%

 

18.35

%

 

19.32

%

 

17.25

%

 

2.18

%

 

15.21

%

 

7.48

%

 

Three Months Ended

Six Months Ended

 

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

6/30/23

6/30/22

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Income (GAAP)

$

15,203

 

$

14,244

 

$

13,855

 

$

12,287

 

$

10,958

 

$

29,448

 

$

21,574

 

Adjustment to FTE Basis

 

35

 

 

31

 

 

29

 

 

31

 

 

34

 

 

65

 

 

71

 

Interest Income (FTE) (Non-GAAP)

 

15,238

 

 

14,275

 

 

13,884

 

 

12,318

 

 

10,992

 

 

29,513

 

 

21,645

 

Interest Expense (GAAP)

 

4,083

 

 

2,661

 

 

1,989

 

 

1,272

 

 

795

 

 

6,744

 

 

1,518

 

Net Interest Income (FTE) (Non-GAAP)

$

11,155

 

$

11,614

 

$

11,895

 

$

11,046

 

$

10,197

 

$

22,769

 

$

20,127

 

 

 

 

 

 

 

 

 

Net Interest Rate Spread (GAAP)

 

2.78

%

 

3.12

%

 

3.17

%

 

3.10

%

 

3.00

%

 

2.95

%

 

3.00

%

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)

 

2.79

 

 

3.13

 

 

3.18

 

 

3.11

 

 

3.01

 

 

2.96

 

 

3.01

 

 

 

 

 

 

 

 

 

Net Interest Margin (GAAP)

 

3.29

%

 

3.51

%

 

3.45

%

 

3.29

%

 

3.12

%

 

3.40

%

 

3.10

%

Adjustment to FTE Basis

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

Net Interest Margin (FTE) (Non-GAAP)

 

3.30

 

 

3.52

 

 

3.46

 

 

3.30

 

 

3.13

 

 

3.41

 

 

3.11

 

 

Three Months Ended

Six Months Ended

 

6/30/23

3/31/23

12/31/22

9/30/22

6/30/22

6/30/23

6/30/22

(Dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Before Income Tax Expense (Benefit) (GAAP)

$

3,456

 

$

5,285

 

$

5,228

 

$

4,927

 

$

74

 

$

8,742

 

$

3,924

 

Provision for Credit Losses

 

492

 

 

80

 

 

 

 

 

 

3,784

 

 

572

 

 

3,784

 

PPNR (Non-GAAP) (Numerator)

$

3,948

 

$

5,365

 

$

5,228

 

$

4,927

 

$

3,858

 

$

9,314

 

$

7,708

 

 

 

 

 

 

 

 

 

Annualization Factor

 

4.01

 

 

4.06

 

 

3.97

 

 

3.97

 

 

4.01

 

 

2.02

 

 

2.02

 

 

 

 

 

 

 

 

 

Average Assets (Denominator)

$

1,406,741

 

$

1,388,248

 

$

1,414,300

 

$

1,396,614

 

$

1,391,928

 

$

1,397,546

 

$

1,407,413

 

 

 

 

 

 

 

 

 

PPNR Return on Average Assets (Non-GAAP)

 

1.13

%

 

1.57

%

 

1.47

%

 

1.40

%

 

1.11

%

 

1.34

%

 

1.10

%

 

Contacts

Company Contact:

John H. Montgomery

President and Chief Executive Officer

Phone: (724) 225-2400

Investor Relations:

Jeremy Hellman, Vice President

The Equity Group Inc.

Phone: (212) 836-9626

Email: jhellman@equityny.com

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