RALEIGH, N.C., Nov. 02, 2018 (GLOBE NEWSWIRE) — West Town Bancorp, Inc. (OTC PINK: WTWB) (the “Company” or “West Town”), the multi-bank financial holding company for West Town Bank & Trust and Sound Bank, announced today its financial results for the quarter ended September 30, 2018. Highlights for the third quarter of 2018 and the Company’s year-to-date performance include the following:
Third quarter net income of $1,028,000 or $0.33 per diluted share, compared to $947,000 or $0.56 per diluted share for the third quarter of 2017.
- Return on average assets of 0.76%, compared to 1.09% for the third quarter of 2017.
- Return on average common equity of 5.29%, compared 9.62% for the third quarter of 2017.
- Return on average tangible common equity of 8.74%, compared to 9.99% for the third quarter of 2017.
Year-to-date net income of $11,180,000 or $3.60 per diluted share, compared to $2,340,000 or $1.47 per diluted share for the nine-month period ending September 30, 2017.
- Return on average assets of 2.78%, compared to 1.05% for the prior year period.
- Return on average common equity of 20.56%, compared to 9.49% for the prior year period.
- Return on tangible common equity of 29.08%, compared to 9.81% for the prior year period.
Eric Bergevin, President and CEO, commented, “2018 is shaping up to be a banner year for the Company due to the impact of the Company’s strategic initiatives deployed, starting with the Sound Bank acquisition that occurred on September 1, 2017:
- In comparison to September 30, 2017, portfolio loans have grown 16% and our emphasis on relationship and commercial banking has resulted in a 34% increase in noninterest deposits.
- The completion of our acquisition of Windsor Advantage LLC (“Windsor”) has resulted in a net income contribution by Windsor of $1.1 million since the acquisition date of April 30, 2018. This does not include the $933,000 in noninterest income earned prior to the acquisition date.
- We have earned revenue of $12.5 million from loan sales in the secondary market due in large part to the ‘originate and hold’ strategy that was put in place during the 4th quarter of 2017.
- Our efficiency ratio has improved to 63.3% in the first nine months of 2018 (excluding one-time gains on sale of assets and consolidation) from the 72.6% in the first nine months of 2017.
As anticipated, our third quarter results were down in comparison to the prior two quarters of this year due to the completion of our ‘originate and hold’ governmental guaranteed loan strategy and the inherent seasonal impact tax equity investment has on utility scale solar finance and development. Also, in comparison to the second quarter of 2018, earnings are down due to the pre-tax $4,776,000 gain on the consolidation of Windsor that occurred with the purchase of the remaining 56.5% of Windsor in the second quarter. We anticipate finishing the year strong with a robust governmental guaranteed pipeline heading into the fourth quarter.”
Strong Year-Over-Year Loan Balance Sheet Growth
At September 30, 2018, the Company’s total assets were $551,494,000, net loans held for investment were $404,577,000, loans held for sale were $15,819,000, total deposits were $400,086,000 and total shareholder’s equity was $76,445,000. Compared with September 30, 2017, total assets increased $62,295,000 or 13%, loans held for investment increased $56,291,000 or 16%, loans held for sale decreased $5,204,000 or 25%, total deposits increased $11,388,000 or 3% and total shareholders’ equity increased $11,467,000 or 18%.
Noninterest deposits increased $23,845,000 or 34% year over year while interest-bearing deposits decreased $12,457,000 or 4% during the same time-period.
Acquired Loan Summary
| Dollars in thousands | 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | 9/30/17 | ||||||||||
| Performing acquired loans | $ | 98,482 | $ | 107,404 | $ | 121,852 | $ | 132,846 | 142,087 | ||||||
| Less: remaining fair market value (FMV) adjustments | (1,063 | ) | (1,181 | ) | (1,400 | ) | (1,592 | ) | (1,783 | ) | |||||
| Performing acquired loans, net | $ | 97,419 | $ | 106,223 | $ | 120,452 | $ | 131,254 | 140,304 | ||||||
| FMV adjustment % | 1.1 | % | 1.1 | % | 1.1 | % | 1.2 | % | 1.3 | % | |||||
| Purchase credit impaired loans (PCI) | $ | 4,446 | $ | 5,017 | $ | 5,293 | $ | 5,386 | 5,657 | ||||||
| Less: remaining FMV adjustments | (554 | ) | (801 | ) | (826 | ) | (832 | ) | (967 | ) | |||||
| PCI loans, net | $ | 3,892 | $ | 4,216 | $ | 4,467 | $ | 4,554 | 4,690 | ||||||
| FMV adjustment % | 12.5 | % | 16.0 | % | 15.6 | % | 15.4 | % | 17.1 | % | |||||
| Total acquired performing loans | 97,419 | 106,223 | 120,452 | 131,254 | 140,304 | ||||||||||
| Total acquired PCI loans | 3,892 | 4,216 | 4,467 | 4,554 | 4,690 | ||||||||||
| Total acquired loans | 101,311 | 110,439 | 124,919 | 135,808 | 144,994 | ||||||||||
| FMV adjustment % | 1.6 | % | 1.8 | % | 1.8 | % | 1.8 | % | 1.9 | % |
In comparison to September 30, 2017, the performing acquired loan pool decreased $42,885,000 or 31% as of September 30, 2018. The reduction is due to $34,114,000 in net principal payments and $8,884,000 in renewals which moved to the originated category at the time of renewal. The PCI loan pool decreased $798,000 year-over-year due primarily to net principal payments and a $265,000 transfer to foreclosed properties.
Capital Levels
At September 30, 2018, both banks’ capital ratios exceed the minimum thresholds established for well-capitalized banks by regulatory measures.
| “Well Capitalized” Minimums | West Town Bank & Trust | Sound Bank | |
| Tier 1 common equity ratio | 6.5% | 13.3% | 11.9% |
| Tier 1 risk-based capital ratio | 8.0% | 13.3% | 11.9% |
| Total risk-based capital ratio | 10.0% | 14.6% | 12.2% |
| Tier 1 leverage ratio | 5.0% | 11.5% | 9.4% |
The book value per common share increased from $22.03 at September 30, 2017 to $25.31 at September 30, 2018. The tangible book value per common share decreased from $18.69 at September 30, 2017 to $15.30 at September 30, 2018 due to the Company’s acquisition of the remaining 56.5% of Windsor which occurred on April 30, 2018. The tangible book value per common share increased from $14.96 at June 30, 2018 to $15.30 at September 30, 2018.
Asset Quality
The Company’s nonperforming assets to total assets ratio decreased 38 basis points from 1.68% at September 30, 2017 to 1.30% at September 30, 2018. Excluding acquired loans, the Company’s nonperforming assets to total loans and OREO ratio decreased 116 bps from 3.30% at September 30, 2017 to 2.14% at September 30, 2018 as nonaccrual loan balances have declined and originated loans have increased $101,033,000 during the same 12-month period.
The Company recorded a $789,000 provision for loan losses during the third quarter of 2018, as compared to a provision of $491,000 in third quarter 2017. The Company recorded $725,000 in net charge-offs during the third quarter with the remaining provision expense due to volume growth. Excluding acquired loans, the ratio of allowance for loan and lease losses as a percentage of total originated loans decreased 11 bps from one year earlier, from 1.38% at September 30, 2017 to 1.27% at September 30, 2018.
| Dollars in thousands | Ending Balance | ||||||||||||||
| 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | 9/30/17 | |||||||||||
| Nonaccrual loans – originated | $ | 5,806 | $ | 6,233 | $ | 5,910 | $ | 6,218 | $ | 6,803 | |||||
| Nonaccrual loans – acquired | 280 | 292 | 182 | 413 | 0 | ||||||||||
| OREO – originated | 796 | 54 | 54 | 0 | 0 | ||||||||||
| OREO – acquired | 0 | 0 | 0 | 0 | 0 | ||||||||||
| 90 days past due – originated | 3 | 8 | 186 | 0 | 0 | ||||||||||
| 90 days past due – acquired | 280 | 553 | 594 | 697 | 1,396 | ||||||||||
| Total nonperforming assets | 7,165 | 7,140 | 6,926 | 7,328 | 8,199 | ||||||||||
| Total nonperforming assets – originated | 6,605 | 6,295 | 6,150 | 6,218 | 6,803 | ||||||||||
| Net charge-offs | $ | 725 | $ | 216 | $ | 105 | $ | 543 | $ | 230 | |||||
| Annualized net charge-offs to total average portfolio loans | 0.68 | % | 0.20 | % | 0.09 | % | 0.54 | % | 0.34 | % | |||||
| Ratio of total nonperforming assets to total assets | 1.30 | % | 1.31 | % | 1.26 | % | 1.35 | % | 1.68 | % | |||||
| Ratio of total nonperforming loans to total portfolio loans | 1.57 | % | 1.77 | % | 1.78 | % | 1.95 | % | 2.35 | % | |||||
| Ratio of total allowance for loan losses to total portfolio loans | 0.95 | % | 0.95 | % | 0.97 | % | 0.91 | % | 0.81 | % | |||||
| Excluding acquired (Non-GAAP) | |||||||||||||||
| Ratio of nonperforming assets to loans and OREO | 2.14 | % | 2.14 | % | 2.31 | % | 2.56 | % | 3.30 | % | |||||
| Ratio of nonperforming loans to loans | 1.89 | % | 2.12 | % | 2.29 | % | 2.56 | % | 3.30 | % | |||||
| Ratio of allowance for loan losses to loans | 1.27 | % | 1.30 | % | 1.43 | % | 1.41 | % | 1.38 | % |
Net Interest Income and Margin
Net interest income for the three months ended September 30, 2018 increased $1,722,000 or 48% in comparison to the third quarter of 2017 while the net interest margin decreased from 4.58% for the third quarter of 2017 to 4.45% for the third quarter of 2018. The increased net interest income is due to the acquisition of Sound Bank which occurred on September 1, 2017. The margin compression is a combination of a reduction in the yield on earning assets from 5.63% to 5.58% and an increase in the cost of funds from 1.10% to 1.18% due to increased deposit competition and interest rates.
Net Interest Income and Margin
(Includes Sound Bank as of 9/1/2017)
| Dollars in thousands | Three Months Ended | Year-to-Date | |||||||||||||
| 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | 9/30/17 | 9/30/18 | 9/30/17 | |||||||||
| Quarterly average balances: | |||||||||||||||
| Loans | $ | 426,160 | $ | 435,778 | $ | 446,857 | $ | 400,324 | $ | 273,225 | $ | 436,189 | $ | 240,686 | |
| Investment securities | 15,377 | 13,949 | 11,353 | 7,346 | 6,944 | 13,575 | 5,566 | ||||||||
| Interest-bearing balances and other | 28,481 | 23,258 | 24,803 | 37,640 | 27,171 | 25,527 | 19,722 | ||||||||
| Total interest-earning assets | 470,018 | 472,985 | 483,013 | 445,310 | 307,340 | 475,291 | 265,974 | ||||||||
| Noninterest-bearing deposits | 90,073 | 82,971 | 82,849 | 75,707 | 40,028 | 85,324 | 27,961 | ||||||||
| Interest-bearing liabilities: | |||||||||||||||
| Interest-bearing deposits | 294,502 | 292,409 | 302,119 | 312,155 | 239,475 | 296,315 | 213,447 | ||||||||
| Borrowed funds | 63,356 | 78,457 | 76,422 | 31,574 | 13,748 | 72,697 | 15,217 | ||||||||
| Total interest-bearing liabilities | 357,858 | 370,866 | 378,541 | 343,729 | 253,223 | 369,012 | 228,664 | ||||||||
| Total assets | 536,172 | 538,249 | 536,185 | 495,958 | 343,328 | 536,869 | 296,754 | ||||||||
| Common shareholders’ equity | 77,129 | 73,725 | 67,013 | 60,432 | 40,848 | 72,659 | 32,983 | ||||||||
| Tangible common equity | 46,667 | 49,882 | 57,799 | 50,795 | 37,617 | 51,408 | 31,894 | ||||||||
| Dollars in thousands | Three Months Ended | Year-to-Date | ||||||||||||||||||||
| 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | 9/30/17 | 9/30/18 | 9/30/17 | ||||||||||||||||
| Interest Income/Expense: | ||||||||||||||||||||||
| Loans | $ | 6,329 | $ | 6,577 | $ | 6,036 | $ | 6,061 | $ | 4,223 | $ | 18,942 | $ | 10,884 | ||||||||
| Investment securities, tax | 111 | 105 | 64 | 39 | 47 | 280 | 105 | |||||||||||||||
| Interest-bearing balances and other | 170 | 126 | 120 | 117 | 95 | 416 | 188 | |||||||||||||||
| Total interest income | 6,610 | 6,808 | 6,220 | 6,217 | 4,365 | 19,638 | 11,177 | |||||||||||||||
| Deposits | 906 | 815 | 771 | 791 | 712 | 2,492 | 2,073 | |||||||||||||||
| Borrowings | 431 | 474 | 378 | 192 | 102 | 1,283 | 250 | |||||||||||||||
| Total interest expense | 1,337 | 1,289 | 1,149 | 983 | 814 | 3,775 | 2,323 | |||||||||||||||
| Net interest income | $ | 5,273 | $ | 5,519 | $ | 5,071 | $ | 5,234 | $ | 3,551 | $ | 15,863 | $ | 8,854 | ||||||||
| Average Yields and Costs: | ||||||||||||||||||||||
| Loans | 5.89 | % | 6.05 | % | 5.48 | % | 6.01 | % | 6.13 | % | 5.81 | % | 6.05 | % | ||||||||
| Investment securities | 2.89 | % | 3.01 | % | 2.25 | % | 2.12 | % | 2.71 | % | 2.75 | % | 2.52 | % | ||||||||
| Interest-bearing balances and other | 2.37 | % | 2.17 | % | 1.96 | % | 1.23 | % | 1.39 | % | 2.18 | % | 1.27 | % | ||||||||
| Total interest-earning assets | 5.58 | % | 5.77 | % | 5.22 | % | 5.54 | % | 5.63 | % | 5.52 | % | 5.62 | % | ||||||||
| Total interest-bearing deposits | 1.22 | % | 1.12 | % | 1.03 | % | 1.01 | % | 1.18 | % | 1.12 | % | 1.30 | % | ||||||||
| Borrowed funds | 2.70 | % | 2.42 | % | 2.01 | % | 2.41 | % | 2.94 | % | 2.36 | % | 2.20 | % | ||||||||
| Total interest-bearing liabilities | 1.48 | % | 1.39 | % | 1.23 | % | 1.13 | % | 1.28 | % | 1.37 | % | 1.36 | % | ||||||||
| Cost of funds | 1.18 | % | 1.14 | % | 1.01 | % | 0.93 | % | 1.10 | % | 1.11 | % | 1.21 | % | ||||||||
| Net interest margin | 4.45 | % | 4.68 | % | 4.26 | % | 4.66 | % | 4.58 | % | 4.46 | % | 4.45 | % |
Noninterest Income
Noninterest income for the three months ended September 30, 2018 was $3,869,000, an increase of $856,000 or 28% as compared to the same prior year period. Specific items to note:
- Windsor revenue totaled $1,791,000, an increase of $1,272,000 or 245% as compared to the income earned from the investment in Windsor during the same prior year period. The increase is directly attributable to the Company’s acquisition of the remaining 56.5% of Windsor that it did not previously own, which acquisition occurred during the 2018 second quarter and resulted in Windsor becoming a wholly owned subsidiary of the Company.
- Service charges increased $107,000 or 120% as compared to the third quarter of 2017 due to the acquisition of Sound Bank that occurred on September 1, 2017;
- Governmental lending revenue decreased $416,000 or 27% in comparison to the third quarter of 2017; and
- Mortgage revenue decreased $208,000 or 30% in comparison to the third quarter of 2017.
Noninterest Expense
Noninterest expense for the third quarter of 2018 increased $2,499,000 or 56% from $4,454,000 for the three months ended September 30, 2017 to $6,953,000 for the three months ended September 30, 2018. The increase is primarily due to the inclusion of Sound Bank and Windsor expenses for the full three-month period in 2018 as compared to one month of expenses included from Sound Bank and no expenses from Windsor in the third quarter of 2017.
Branch Network Reorganization
On July 16, 2018, Sound Bank and West Town Bank & Trust entered into a purchase and assumption agreement pursuant to which Sound Bank would acquire West Town Bank & Trust’s two North Carolina branches located in Edenton, NC and Winterville, NC. The branch transaction closed on October 26, 2018, following receipt of required regulatory approvals. In addition to the transfer of certain real property in Edenton, NC, the branch reorganization resulted in the transfer of approximately $34.1 million in loan assets, $32.7 million in deposit liabilities, and $3.6 million in additional paid in capital to Sound Bank from its sister institution, West Town Bank & Trust. The closing of the transaction, which occurred subsequent to the quarter ending September 30, 2018, is not fully reflected in the results reported in this release.
About West Town Bancorp, Inc.
West Town Bancorp, Inc. is the multi-bank financial holding company for West Town Bank & Trust, a North Riverside, IL based state-chartered bank, and Sound Bank, a Morehead City, NC based state-chartered bank. West Town Bank & Trust provides banking services through its offices in Illinois, while Sound Bank provides banking services through its offices in North Carolina. Primary deposit products are checking, savings, and time certificate accounts, and primary lending products are government guaranteed lending, residential mortgage, commercial, and installment loans. The Company is also the parent company of Windsor Advantage, LLC, a loan servicing company, and West Town Insurance Agency, Inc., an insurance agency. The Company is registered with, and supervised by, the Federal Reserve. West Town Bank & Trust’s primary regulators are the Illinois Department of Financial and Professional Regulation and the FDIC. Sound Bank’s primary regulators are the North Carolina Commissioner of Banks and the FDIC.
For more information, visit https://investors.westtownbancorp.com.
Important Note Regarding Forward-Looking Statements
This release contains certain forward-looking statements with respect to the financial condition, results of operations, and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate,” and “believe,” variations of these words, and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause a difference include, among others: changes in the national and local economies or market conditions; changes in interest rates, deposit flows, loan demand, and asset quality, including real estate and other collateral values; changes in Small Business Administration rules, regulations, or loan products, including the section 7(a) program; changes in other government guaranteed loan programs or our ability to participate in such programs; recent changes in tax law, including the impact of such changes on our tax assets and liabilities; changes in banking regulations and accounting principles, policies, or guidelines; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with the Company’s acquisition activities; the failure of our strategic investments or acquisitions to perform as anticipated and the impact of any impairments to our intangible assets, such as goodwill; and the impact of competition from traditional or new sources. These, and other factors that may emerge, could cause decisions and actual results to differ materially from current expectations. The Company assumes no obligation to revise, update, or clarify forward-looking statements to reflect events or conditions after the date of this release.
Consolidated Balance Sheet
(Includes Sound Bank as of 9/1/2017)
| Dollars in thousands; unaudited | Ending Balance | ||||||||||||||
| 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | 9/30/17 | |||||||||||
| Assets | |||||||||||||||
| Cash and due from banks | $ | 5,292 | $ | 4,961 | $ | 4,725 | $ | 2,986 | $ | 7,629 | |||||
| Interest-bearing deposits | 38,779 | 27,532 | 30,299 | 40,961 | 57,502 | ||||||||||
| Total cash and cash equivalents | 44,071 | 32,493 | 35,024 | 43,947 | 65,131 | ||||||||||
| Securities available for sale, at fair value | 20,615 | 13,769 | 14,171 | 7,119 | 7,468 | ||||||||||
| Loans held for sale | 15,819 | 31,994 | 61,286 | 66,706 | 21,023 | ||||||||||
| Loans held for investment: | |||||||||||||||
| Originated loans | 307,166 | 294,471 | 265,887 | 242,744 | 206,133 | ||||||||||
| Acquired loans, net | 101,311 | 110,439 | 124,919 | 135,808 | 144,994 | ||||||||||
| Allowance for loan losses | (3,900 | ) | (3,835 | ) | (3,791 | ) | (3,427 | ) | (2,841 | ) | |||||
| Net loans held for investment | 404,577 | 401,075 | 387,015 | 375,125 | 348,286 | ||||||||||
| Premises and equipment, net | 12,263 | 11,586 | 11,502 | 11,563 | 11,693 | ||||||||||
| Foreclosed assets | 796 | 54 | 54 | 0 | 0 | ||||||||||
| Servicing assets | 4,280 | 4,598 | 4,969 | 5,237 | 5,568 | ||||||||||
| Bank owned life insurance | 8,977 | 8,917 | 8,853 | 8,796 | 8,736 | ||||||||||
| Accrued interest receivable | 1,758 | 1,776 | 1,870 | 1,544 | 1,758 | ||||||||||
| Goodwill | 19,745 | 19,745 | 7,016 | 7,016 | 7,016 | ||||||||||
| Other intangible assets, net | 10,493 | 10,837 | 2,102 | 2,272 | 2,450 | ||||||||||
| Other assets | 8,100 | 7,644 | 15,565 | 14,809 | 10,070 | ||||||||||
| Total assets | $ | 551,494 | $ | 544,488 | $ | 549,427 | $ | 544,134 | $ | 489,199 | |||||
| Liabilities and Shareholders’ Equity | |||||||||||||||
| Liabilities | |||||||||||||||
| Deposits: | |||||||||||||||
| Noninterest-bearing | $ | 94,829 | $ | 88,172 | $ | 86,561 | $ | 84,178 | $ | 70,984 | |||||
| Interest-bearing | 305,257 | 289,416 | 298,711 | 308,556 | 317,714 | ||||||||||
| Total deposits | 400,086 | 377,588 | 385,272 | 392,734 | 388,698 | ||||||||||
| Short term borrowings | 58,400 | 73,400 | 81,500 | 72,100 | 12,000 | ||||||||||
| Long term borrowings | 7,267 | 7,754 | 6,314 | 6,803 | 7,309 | ||||||||||
| Accrued interest payable | 550 | 466 | 389 | 296 | 218 | ||||||||||
| Other liabilities | 8,746 | 9,600 | 7,984 | 6,621 | 15,996 | ||||||||||
| Total liabilities | 475,049 | 468,808 | 481,459 | 478,554 | 424,221 | ||||||||||
| Shareholders’ equity | |||||||||||||||
| Preferred stock | 0 | 0 | 0 | 0 | 7,570 | ||||||||||
| Common stock, voting | 2,666 | 2,660 | 2,623 | 2,623 | 1,922 | ||||||||||
| Common stock, non-voting | 329 | 329 | 329 | 329 | 0 | ||||||||||
| Additional paid-in capital | 44,576 | 44,429 | 44,385 | 44,185 | 37,563 | ||||||||||
| Retained earnings | 29,154 | 28,436 | 20,765 | 18,447 | 17,895 | ||||||||||
| Accumulated other comprehensive income (loss) | (280 | ) | (174 | ) | (134 | ) | (4 | ) | 28 | ||||||
| Total shareholders’ equity | 76,445 | 75,680 | 67,968 | 65,580 | 64,978 | ||||||||||
| Total liabilities and shareholders’ equity | $ | 551,494 | $ | 544,488 | $ | 549,427 | $ | 544,134 | $ | 489,199 |
Financial Performance (Consolidated)
(Includes Sound Bank as of 9/1/2017)
| Dollars in thousands, except per share data; unaudited | Three Months Ended | Year-to-Date | ||||||||||||||||
| 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | 9/30/17 | 9/30/18 | 9/30/17 | ||||||||||||
| Interest income | ||||||||||||||||||
| Interest and fees on loans | $ | 6,329 | $ | 6,577 | $ | 6,036 | $ | 6,062 | $ | 4,223 | $ | 18,942 | $ | 10,884 | ||||
| Investment securities & deposits | 281 | 231 | 184 | 155 | 142 | 696 | 293 | |||||||||||
| Total interest income | 6,610 | 6,808 | 6,220 | 6,217 | 4,365 | 19,638 | 11,177 | |||||||||||
| Interest expense | ||||||||||||||||||
| Interest on deposits | 906 | 815 | 771 | 792 | 712 | 2,492 | 2,073 | |||||||||||
| Interest on borrowed funds | 431 | 474 | 378 | 191 | 102 | 1,283 | 250 | |||||||||||
| Total interest expense | 1,337 | 1,289 | 1,149 | 983 | 814 | 3,775 | 2,323 | |||||||||||
| Net interest income | 5,273 | 5,519 | 5,071 | 5,234 | 3,551 | 15,863 | 8,854 | |||||||||||
| Provision for loan losses | 789 | 261 | 469 | 1,129 | 491 | 1,519 | 1,048 | |||||||||||
| Noninterest income | ||||||||||||||||||
| Government lending revenue | 1,121 | 4,241 | 3,054 | 192 | 1,537 | 8,416 | 3,903 | |||||||||||
| Mortgage revenue | 491 | 868 | 455 | 515 | 699 | 1,814 | 4,192 | |||||||||||
| Service charge revenue | 196 | 222 | 219 | 203 | 89 | 637 | 121 | |||||||||||
| Bank owned life insurance income | 59 | 64 | 57 | 60 | 42 | 180 | 110 | |||||||||||
| Windsor revenue | 1,791 | 1,683 | 0 | 0 | 0 | 3,474 | 0 | |||||||||||
| Income from Windsor investment | 0 | 369 | 564 | 203 | 519 | 933 | 1,297 | |||||||||||
| Loss on sale of securities | 0 | 0 | 0 | 0 | (7 | ) | 0 | (7 | ) | |||||||||
| Gain on consolidation of Windsor | 0 | 4,776 | 0 | 0 | 0 | 4,776 | 0 | |||||||||||
| Other noninterest income | 211 | 133 | 172 | 373 | 134 | 516 | 365 | |||||||||||
| Total noninterest income | 3,869 | 12,356 | 4,521 | 1,546 | 3,013 | 20,746 | 9,981 | |||||||||||
| Noninterest expense | ||||||||||||||||||
| Compensation | 4,245 | 4,050 | 3,266 | 3,248 | 2,481 | 11,561 | 8,094 | |||||||||||
| Occupancy and equipment | 522 | 462 | 413 | 434 | 303 | 1,397 | 983 | |||||||||||
| Loan and special assets | 67 | 407 | 362 | 373 | 287 | 836 | 714 | |||||||||||
| Professional services | 437 | 317 | 274 | 313 | 155 | 1,028 | 817 | |||||||||||
| Data processing | 326 | 325 | 313 | 316 | 247 | 964 | 538 | |||||||||||
| Communication | 191 | 203 | 235 | 188 | 112 | 629 | 281 | |||||||||||
| Advertising | 147 | 418 | 54 | 109 | 91 | 619 | 260 | |||||||||||
| (Gain) loss on sale of foreclosed assets | 0 | 41 | 0 | 0 | 0 | 41 | (165 | ) | ||||||||||
| Transaction-related expenses | 5 | 74 | 14 | 60 | 231 | 93 | 528 | |||||||||||
| Other operating expense | 1,013 | 1,118 | 864 | 856 | 547 | 2,995 | 1,632 | |||||||||||
| Total noninterest expense | 6,953 | 7,415 | 5,795 | 5,897 | 4,454 | 20,163 | 13,682 | |||||||||||
| Income (loss) before income taxes | 1,400 | 10,199 | 3,328 | (246 | ) | 1,619 | 14,927 | 4,105 | ||||||||||
| Income tax expense (benefit) | 372 | 2,528 | 847 | (798 | ) | 672 | 3,747 | 1,765 | ||||||||||
| Net income | $ | 1,028 | $ | 7,671 | $ | 2,481 | $ | 552 | $ | 947 | $ | 11,180 | $ | 2,340 | ||||
| Basic earnings per common share (1) | $ | 0.34 | $ | 2.58 | $ | 0.84 | $ | 0.21 | $ | 0.59 | $ | 3.76 | $ | 1.54 | ||||
| Diluted earnings per common share (1) | $ | 0.33 | $ | 2.47 | $ | 0.80 | $ | 0.20 | $ | 0.56 | $ | 3.60 | $ | 1.47 | ||||
| Weighted average common shares outstanding (1) | 2,996 | 2,980 | 2,952 | 2,649 | 1,626 | 2,976 | 1,597 | |||||||||||
| Diluted average common shares outstanding (1) | 3,127 | 3,115 | 3,087 | 2,755 | 1,932 | 3,106 | 1,667 |
Performance Ratios
(Includes Sound Bank as of 9/1/2017)
| Three Months Ended | Year-to-Date | |||||||||||||||||||||
| 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | 9/30/17(1) | 9/30/18 | 9/30/17 | ||||||||||||||||
| PER COMMON SHARE | ||||||||||||||||||||||
| Basic earnings per common share | $ | 0.34 | $ | 2.58 | $ | 0.84 | $ | 0.21 | $ | 0.59 | $ | 3.76 | $ | 1.54 | ||||||||
| Diluted earnings per common share | $ | 0.33 | $ | 2.47 | $ | 0.80 | $ | 0.20 | $ | 0.56 | $ | 3.60 | $ | 1.47 | ||||||||
| Book value per common share | $ | 25.31 | $ | 25.11 | $ | 23.02 | $ | 22.21 | $ | 22.03 | $ | 25.31 | $ | 22.03 | ||||||||
| Tangible book value per common share | $ | 15.30 | $ | 14.96 | $ | 19.94 | $ | 19.07 | $ | 18.69 | $ | 15.30 | $ | 18.69 | ||||||||
| FINANCIAL RATIOS (ANNUALIZED) | ||||||||||||||||||||||
| Return on average assets | 0.76 | % | 5.72 | % | 1.88 | % | 0.44 | % | 1.09 | % | 2.78 | % | 1.05 | % | ||||||||
| Return on average common shareholders’ equity | 5.29 | % | 41.73 | % | 15.02 | % | 3.62 | % | 9.62 | % | 20.56 | % | 9.49 | % | ||||||||
| Return on average tangible common shareholders’ equity | 8.74 | % | 61.68 | % | 18.30 | % | 4.31 | % | 9.99 | % | 29.08 | % | 9.81 | % | ||||||||
| Net interest margin (FTE) | 4.45 | % | 4.68 | % | 4.26 | % | 4.66 | % | 4.58 | % | 4.46 | % | 4.45 | % | ||||||||
| Efficiency ratio | 76.1 | % | 56.6 | % | 60.4 | % | 87.0 | % | 67.8 | % | 63.3 | % | 72.6 | % |
(1) Calculation of book value per common share and tangible book value per common share for September 30, 2017, includes the 698,580 common shares that were issued in October 2017 for the Sound Bank acquisition and the convertible preferred equity as if converted to 329,130 shares of common stock. These incremental shares are not included in EPS calculations for the quarter ended September 30, 2017.
Contact: Eric Bergevin, 252-482-4400
