FSFG - First Savings Financial Group Inc. Reports Financial Results for the First Fiscal Quarter Ended December 31 2021
JEFFERSONVILLE, Ind., Jan. 25, 2022 (GLOBE NEWSWIRE) -- First Savings Financial Group, Inc. (NASDAQ: FSFG - news) (the "Company"), the holding company for First Savings Bank (the "Bank"), today reported net income of $4.3 million, or $0.60 per diluted share, for the quarter ended December 31, 2021 compared to net income of $9.9 million, or $1.39 per diluted share, for the quarter ended December 31, 2020.
Commenting on the Company’s performance, Larry W. Myers, President and CEO, stated: “We had a very strong quarter of loan growth, recognized a stable net interest margin excluding PPP loans, realized improved asset quality ratios, executed our first sale of single-tenant net lease loans, and continued to stabilize the financial performance of the mortgage banking segment while positioning it for growth in calendar 2022. The core banking segment provided solid performance while the SBA lending segment underperformed due to an increase in provision for loan losses related to downgrades of nonperforming loans, which is oftentimes challenging to predict. I’m optimistic that the Company is well-positioned for the opportunities and challenges that will occur during 2022 and that each of the business lines will thrive and deliver exceptional value to our shareholders.”
Results of Operations for the Three Months Ended December 31, 2021 and 2020
Net interest income increased $164,000, or 1.2%, to $13.9 million for the three months ended December 31, 2021 as compared to the same period in 2020. The increase in net interest income was due to a $428,000 decrease in interest expense, partially offset by a $264,000 decrease in interest income. Interest income decreased due to a decrease in the average balance of interest-earning assets of $99.3 million, from $1.63 billion for 2020 to $1.53 billion for 2021, partially offset by an increase in the weighted-average tax-equivalent yield, from 4.03% for 2020 to 4.22% for 2021. The decrease in the average balance of interest-earning assets was due primarily to a decrease in PPP loans of $128.1 million and the increase in the weighted-average tax-equivalent yield is due primarily to an increase in the yield on PPP loans from 2.42% for 2020 to 4.65% for 2021. The increase in the yield on PPP loans was due to accelerated recognition of deferred PPP loan fees related to forgiveness payoffs during the quarter ended December 31, 2021. Interest expense decreased due to a decrease in the average cost of interest-bearing liabilities, from 0.70% for 2020 to 0.62% for 2021, and a decrease in the average balance of interest-bearing liabilities of $113.0 million, from $1.31 billion for 2020 to $1.20 billion for 2021. The decrease in the average cost of interest-bearing liabilities for 2021 was due primarily to decreasing market interest rates on deposits, including brokered certificates of deposit, and FHLB borrowings.
The Company recognized a provision for loan losses of $526,000 for the three months ended December 31, 2021 compared to a provision of $668,000 for the same period in 2020. Nonperforming loans, which consist of nonaccrual loans and loans over 90 days past due and still accruing interest, decreased $2.7 million from $15.5 million at September 30, 2021 to $12.7 million at December 31, 2021. The Company recognized net charge-offs of $47,000 for the three months ended December 31, 2021, compared to net charge-offs of $570,000 for the same period in 2020, of which $506,000 was related to unguaranteed portions of SBA loans.
Noninterest income decreased $29.6 million for the three months ended December 31, 2021 as compared to the same period in 2020. The decrease was due primarily to a decrease in mortgage banking income of $30.5 million. The decrease in mortgage banking income was primarily due to a $38.1 million decrease in production revenue from lower originations for sale, a decrease in the gain on sale margin, from 3.50% in 2020 to 2.08% in 2021, and an $8.4 million decrease in capitalized residential mortgage loan servicing rights, partially offset by a $675,000 increase in the fair value of the residential mortgage loan servicing rights portfolio in 2021 as compared to a $3.1 million unfavorable fair value adjustment recognized in 2020. Mortgage loans originated for sale were $541.1 million in the three months ended December 31, 2021 as compared to $1.43 billion in the same period in 2020.
Noninterest expense decreased $19.6 million for the three months ended December 31, 2021 as compared to the same period in 2020. The decrease was due primarily to decreases in compensation and benefits and advertising expense of $16.6 million and $1.5 million, respectively. The decrease in compensation and benefits expense is due primarily to a reduction in incentive compensation for the Company’s mortgage banking segment as a result of decreased mortgage banking income. The decrease in advertising expense was related to the reduced loan origination volume of the mortgage banking segment.
The Company recognized income tax expense of $811,000 for the three months ended December 31, 2021 compared to $4.5 million for the same period in 2020. The decrease was primarily the result of lower pretax income in 2021. The effective tax rate for 2021 was 15.9% as compared to 30.5% for 2020. The lower effective tax rate for 2021 was primarily due to lower nondeductible executive compensation expense in 2021 as compared to 2020.
Comparison of Financial Condition at December 31, 2021 and September 30, 2021
Total assets increased $43.2 million, from $1.72 billion at September 30, 2021 to $1.76 billion at December 31, 2021. Net loans held for investment increased $66.7 million during the quarter ended December 31, 2021, due primarily to growth in single-tenant net lease commercial real estate and residential mortgage loans, partially offset by a $10.6 million decrease in PPP loans. Excluding the decrease in PPP loans, net loans held for investment increased $77.3 million, or 7.2%, during the quarter ended December 31, 2021. Residential mortgage and single-tenant net lease loans held for sale decreased $47.2 million and $7.4 million, respectively, during the quarter due to loan sales outpacing originations. Residential mortgage loan servicing rights increased $5.2 million, or 10.5%, to $54.8 million at December 31, 2021 as the Company continues to increase its loan servicing portfolio.
Total liabilities increased $39.4 million due primarily to an increase of $39.5 million in total deposits.
Common stockholders’ equity increased $3.8 million, from $180.4 million at September 30, 2021 to $184.2 million at December 31, 2021, due primarily to an increase in retained net income of $3.4 million. At December 31, 2021 and September 30, 2021, the Bank was considered “well-capitalized” under applicable regulatory capital guidelines.
First Savings Bank is an entrepreneurial community bank headquartered in Jeffersonville, Indiana, which is directly across the river from Louisville, Kentucky, and operates fifteen depository branches within Southern Indiana. The Bank also has three national lending programs, including single-tenant net lease commercial real estate, SBA lending and residential mortgage banking, with offices located throughout the United States. The Bank is a recognized leader, both in its local communities and nationally for its lending programs. The employees of First Savings Bank strive daily to achieve the organization’s vision, We Expect To Be The BEST community BANK, which fuels our success. The Company’s common shares trade on The NASDAQ Stock Market under the symbol “FSFG.”
This release may contain forward-looking statements within the meaning of the federal securities laws. These statements are not historical facts; rather, they are statements based on the Company's current expectations regarding its business strategies and their intended results and its future performance. Forward-looking statements are preceded by terms such as "expects," "believes," "anticipates," "intends" and similar expressions.
Forward-looking statements are not guarantees of future performance. Numerous risks and uncertainties could cause or contribute to the Company's actual results, performance and achievements to be materially different from those expressed or implied by the forward-looking statements. Factors that may cause or contribute to these differences include, without limitation, changes in general economic conditions, including the duration, extent and severity of the COVID-19 pandemic, including its effect on our customers, service providers and on the economy and financial markets in general; changes in market interest rates; changes in monetary and fiscal policies of the federal government; legislative and regulatory changes; and other factors disclosed periodically in the Company's filings with the Securities and Exchange Commission.
Because of the risks and uncertainties inherent in forward-looking statements, readers are cautioned not to place undue reliance on them, whether included in this report or made elsewhere from time to time by the Company or on its behalf. Except as may be required by applicable law or regulation, the Company assumes no obligation to update any forward-looking statements.
Contact:
Tony A. Schoen, CPA
Chief Financial Officer
812-283-0724
| FIRST SAVINGS FINANCIAL GROUP, INC. |
| CONSOLIDATED FINANCIAL HIGHLIGHTS |
| (Unaudited) |
| * All share and per share amounts have been adjusted to reflect the three-for-one stock split effective September 15, 2021. |
| Three Months Ended |
| December 31, |
| OPERATING DATA: |
| 2021 |
| 2020 |
| (In thousands, except share and per share data) |
| Total interest income |
| $ |
| 15,762 |
| $ |
| 16,026 |
| Total interest expense |
| 1,859 |
| 2,287 |
| Net interest income |
| 13,903 |
| 13,739 |
| Provision for loan losses |
| 526 |
| 668 |
| Net interest income after provision for loan losses |
| 13,377 |
| 13,071 |
| Total noninterest income |
| 16,591 |
| 46,183 |
| Total noninterest expense |
| 24,852 |
| 44,402 |
| Income before income taxes |
| 5,116 |
| 14,852 |
| Income tax expense |
| 811 |
| 4,527 |
| Net income |
| 4,305 |
| 10,325 |
| Less: Net income attributable to noncontrolling interests |
| - |
| 402 |
| Net income attributable to the Company |
| $ |
| 4,305 |
| $ |
| 9,923 |
| Net income per share, basic |
| $ |
| 0.60 |
| $ |
| 1.40 |
| Weighted average shares outstanding, basic |
| 7,116,790 |
| 7,101,183 |
| Net income per share, diluted |
| $ |
| 0.60 |
| $ |
| 1.39 |
| Weighted average shares outstanding, diluted |
| 7,207,210 |
| 7,154,106 |
| Performance ratios (three-month data annualized) |
| Return on average assets |
| 1.01 |
| % |
| 2.23 |
| % |
| Return on average equity |
| 9.45 |
| % |
| 25.43 |
| % |
| Return on average common stockholders' equity |
| 9.45 |
| % |
| 24.52 |
| % |
| Net interest margin (tax equivalent basis) |
| 3.73 |
| % |
| 3.46 |
| % |
| Efficiency ratio |
| 81.50 |
| % |
| 74.10 |
| % |
| December 31, |
| September 30, |
| Increase |
| FINANCIAL CONDITION DATA: |
| 2021 |
| 2021 |
| (Decrease) |
| (In thousands, except per share data) |
| Total assets |
| $ |
| 1,764,589 |
| $ |
| 1,721,394 |
| $ |
| 43,195 |
| Cash and cash equivalents |
| 40,592 |
| 33,428 |
| 7,164 |
| Investment securities |
| 220,926 |
| 208,518 |
| 12,408 |
| Loans held for sale |
| 161,218 |
| 214,940 |
| (53,722 |
| ) |
| Gross loans (1) |
| 1,157,435 |
| 1,090,237 |
| 67,198 |
| Allowance for loan losses |
| 14,780 |
| 14,301 |
| 479 |
| Interest earning assets |
| 1,570,079 |
| 1,540,111 |
| 29,968 |
| Goodwill |
| 9,848 |
| 9,848 |
| - |
| Core deposit intangibles |
| 935 |
| 988 |
| (53 |
| ) |
| Loan servicing rights |
| 59,187 |
| 54,026 |
| 5,161 |
| Noninterest-bearing deposits |
| 287,449 |
| 291,039 |
| (3,590 |
| ) |
| Interest-bearing deposits (2) |
| 979,586 |
| 936,541 |
| 43,045 |
| Federal Home Loan Bank borrowings |
| 258,377 |
| 250,000 |
| 8,377 |
| Total liabilities |
| 1,580,369 |
| 1,541,017 |
| 39,352 |
| Stockholders' equity, net of noncontrolling interests |
| 184,220 |
| 180,377 |
| 3,843 |
| Book value per share |
| $ |
| 25.69 |
| $ |
| 25.31 |
| 0.38 |
| Tangible book value per share (3) |
| 24.19 |
| 23.79 |
| 0.40 |
| Non-performing assets: |
| Nonaccrual loans - SBA guaranteed |
| $ |
| 5,518 |
| $ |
| 6,748 |
| $ |
| (1,230 |
| ) |
| Nonaccrual loans - unguaranteed |
| 7,210 |
| 8,252 |
| (1,042 |
| ) |
| Total nonaccrual loans |
| $ |
| 12,728 |
| $ |
| 15,000 |
| $ |
| (2,272 |
| ) |
| Accruing loans past due 90 days |
| - |
| 472 |
| (472 |
| ) |
| Total non-performing loans |
| 12,728 |
| 15,472 |
| (2,744 |
| ) |
| Troubled debt restructurings classified as performing loans |
| 1,704 |
| 1,743 |
| (39 |
| ) |
| Total non-performing assets |
| $ |
| 14,432 |
| $ |
| 17,215 |
| $ |
| (2,783 |
| ) |
| Asset quality ratios: |
| Allowance for loan losses as a percent of total gross loans |
| 1.28 |
| % |
| 1.31 |
| % |
| (0.03 |
| %) |
| Allowance for loan losses as a percent of total gross loans, excluding PPP loans (4) |
| 1.33 |
| % |
| 1.38 |
| % |
| (0.05 |
| %) |
| Allowance for loan losses as a percent of nonperforming loans |
| 116.12 |
| % |
| 92.43 |
| % |
| 23.69 |
| % |
| Nonperforming loans as a percent of total gross loans |
| 1.10 |
| % |
| 1.42 |
| % |
| (0.32 |
| %) |
| Nonperforming assets as a percent of total assets |
| 0.82 |
| % |
| 1.00 |
| % |
| (0.18 |
| %) |
| (1) Includes $46.0 million and $56.7 million of PPP loans at December 31, 2021 and September 30, 2021, respectively. |
| (2) Includes $120.6 million and $100.1 million of brokered certificates of deposit at December 31, 2021 and September 30, 2021, respectively. |
| (3) See reconciliation of GAAP and Non-GAAP financial measures for additional information relating to calculation of this item. |
| (4) Denominator excludes PPP loans, which are fully guaranteed by the SBA. This ratio is non-GAAP, but is believed by management to be meaningful because it provides a comparable ratio after eliminating PPP loans. |
| RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL MEASURES (UNAUDITED): |
| The following non-GAAP financial measures used by the Company provide information useful to investors in understanding the Company's performance. The Company believes the financial measures presented below are important because of their widespread use by investors as a means to evaluate capital adequacy and earnings. The following table summarizes the non-GAAP financial measures derived from amounts reported in the Company's consolidated financial statements and reconciles those non-GAAP financial measures with the comparable GAAP financial measures. |
| December 31, |
| September 30, |
| Increase |
| Tangible Book Value Per Share |
| 2021 |
| 2021 |
| (Decrease) |
| (In thousands, except share and per share data) |
| Stockholders' equity, net of noncontrolling interests (GAAP) |
| $ |
| 184,220 |
| $ |
| 180,377 |
| $ |
| 3,843 |
| Less: goodwill and core deposit intangibles |
| (10,783 |
| ) |
| (10,836 |
| ) |
| 53 |
| Tangible equity (non-GAAP) |
| $ |
| 173,437 |
| $ |
| 169,541 |
| 3,896 |
| Outstanding common shares |
| 7,169,826 |
| 7,125,888 |
| 43,938 |
| Tangible book value per share (non-GAAP) |
| $ |
| 24.19 |
| $ |
| 23.79 |
| $ |
| 0.40 |
| Book value per share (GAAP) |
| $ |
| 25.69 |
| $ |
| 25.31 |
| $ |
| 0.38 |
| SUMMARIZED FINANCIAL INFORMATION (UNAUDITED): |
| As of |
| Summarized Consolidated Balance Sheets |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| (In thousands, except per share data) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Total cash and cash equivalents |
| $ |
| 40,592 |
| $ |
| 33,428 |
| $ |
| 22,909 |
| $ |
| 30,837 |
| $ |
| 35,392 |
| Total investment securities |
| 220,926 |
| 208,518 |
| 209,551 |
| 207,331 |
| 205,661 |
| Total loans held for sale |
| 161,218 |
| 214,940 |
| 277,374 |
| 207,141 |
| 357,242 |
| Total loans, net of allowance for loan losses |
| 1,142,655 |
| 1,075,936 |
| 1,065,852 |
| 1,128,348 |
| 1,114,708 |
| PPP loans |
| 46,020 |
| 56,656 |
| 100,573 |
| 159,320 |
| 178,499 |
| Loan servicing rights |
| 59,187 |
| 54,026 |
| 51,778 |
| 49,367 |
| 35,232 |
| Total assets |
| 1,764,589 |
| 1,721,394 |
| 1,759,330 |
| 1,751,257 |
| 1,873,665 |
| Total deposits |
| $ |
| 1,267,035 |
| $ |
| 1,227,580 |
| $ |
| 1,127,155 |
| $ |
| 1,095,496 |
| $ |
| 1,121,320 |
| Federal Home Loan Bank borrowings |
| 258,377 |
| 250,000 |
| 283,289 |
| 289,237 |
| 340,092 |
| Federal Reserve PPPLF borrowings |
| - |
| - |
| 107,829 |
| 128,494 |
| 172,772 |
| Stockholders' equity |
| $ |
| 184,220 |
| $ |
| 180,377 |
| $ |
| 177,735 |
| $ |
| 173,040 |
| $ |
| 165,745 |
| Outstanding common shares |
| 7,169,826 |
| 7,125,888 |
| 7,124,388 |
| 7,125,081 |
| 7,124,781 |
| Three Months Ended |
| Summarized Consolidated Statements of Income |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| (In thousands, except per share data) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Total interest income |
| $ |
| 15,762 |
| $ |
| 16,243 |
| $ |
| 16,150 |
| $ |
| 16,840 |
| $ |
| 16,026 |
| Total interest expense |
| 1,859 |
| 1,819 |
| 1,921 |
| 2,060 |
| 2,287 |
| Net interest income |
| 13,903 |
| 14,424 |
| 14,229 |
| 14,780 |
| 13,739 |
| Provision (credit) for loan losses |
| 526 |
| 8 |
| (2,730 |
| ) |
| 287 |
| 668 |
| Net interest income after provision for loan losses |
| 13,377 |
| 14,416 |
| 16,959 |
| 14,493 |
| 13,071 |
| Total noninterest income |
| 16,591 |
| 16,495 |
| 18,785 |
| 38,973 |
| 46,183 |
| Total noninterest expense |
| 24,852 |
| 25,104 |
| 30,619 |
| 39,284 |
| 44,402 |
| Income before income taxes |
| 5,116 |
| 5,807 |
| 5,125 |
| 14,182 |
| 14,852 |
| Income tax expense |
| 811 |
| 958 |
| 817 |
| 3,695 |
| 4,527 |
| Net income |
| 4,305 |
| 4,849 |
| 4,308 |
| 10,487 |
| 10,325 |
| Less: net income attributable to noncontrolling interests |
| - |
| - |
| - |
| - |
| 402 |
| Net income attributable to the Company |
| $ |
| 4,305 |
| $ |
| 4,849 |
| $ |
| 4,308 |
| $ |
| 10,487 |
| $ |
| 9,923 |
| Net income per share, basic |
| $ |
| 0.60 |
| $ |
| 0.68 |
| $ |
| 0.61 |
| $ |
| 1.48 |
| $ |
| 1.40 |
| Weighted average shares outstanding, basic |
| 7,116,790 |
| 7,111,594 |
| 7,109,481 |
| 7,108,926 |
| 7,101,183 |
| Net income per share, diluted |
| $ |
| 0.60 |
| $ |
| 0.67 |
| $ |
| 0.60 |
| $ |
| 1.46 |
| $ |
| 1.39 |
| Weighted average shares outstanding, diluted |
| 7,207,210 |
| 7,200,357 |
| 7,178,943 |
| 7,164,189 |
| 7,154,106 |
| Three Months Ended |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| Consolidated Performance Ratios (Annualized) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Return on average assets |
| 1.01 |
| % |
| 1.12 |
| % |
| 1.00 |
| % |
| 2.34 |
| % |
| 2.23 |
| % |
| Return on average equity |
| 9.45 |
| % |
| 10.92 |
| % |
| 9.94 |
| % |
| 24.97 |
| % |
| 25.43 |
| % |
| Return on average common stockholders' equity |
| 9.45 |
| % |
| 10.92 |
| % |
| 9.94 |
| % |
| 24.97 |
| % |
| 24.52 |
| % |
| Net interest margin (tax equivalent basis) |
| 3.73 |
| % |
| 3.79 |
| % |
| 3.75 |
| % |
| 3.69 |
| % |
| 3.46 |
| % |
| Efficiency ratio |
| 81.50 |
| % |
| 81.19 |
| % |
| 92.75 |
| % |
| 73.08 |
| % |
| 74.10 |
| % |
| As of or for the Three Months Ended |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| Consolidated Asset Quality Ratios |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Nonperforming loans as a percentage of total loans |
| 1.10 |
| % |
| 1.42 |
| % |
| 1.15 |
| % |
| 1.00 |
| % |
| 1.10 |
| % |
| Nonperforming assets as a percentage of total assets |
| 0.82 |
| % |
| 1.00 |
| % |
| 0.81 |
| % |
| 0.78 |
| % |
| 0.78 |
| % |
| Allowance for loan losses as a percentage of total loans |
| 1.28 |
| % |
| 1.31 |
| % |
| 1.36 |
| % |
| 1.52 |
| % |
| 1.51 |
| % |
| Allowance for loan losses as a percentage of nonperforming loans |
| 116.12 |
| % |
| 92.43 |
| % |
| 117.88 |
| % |
| 152.72 |
| % |
| 138.02 |
| % |
| Net charge-offs to average outstanding loans |
| 0.00 |
| % |
| 0.03 |
| % |
| 0.00 |
| % |
| -0.00 |
| % |
| 0.04 |
| % |
| SUMMARIZED FINANCIAL INFORMATION (UNAUDITED) (CONTINUED): |
| Three Months Ended |
| Segmented Statements of Income Information |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| (In thousands, except per share data) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Core Banking Segment: |
| Net interest income |
| $ |
| 11,495 |
| $ |
| 11,517 |
| $ |
| 11,401 |
| $ |
| 11,114 |
| $ |
| 10,861 |
| Provision (credit) for loan losses |
| (144 |
| ) |
| (189 |
| ) |
| (2,401 |
| ) |
| 106 |
| 702 |
| Net interest income after provision (credit) for loan losses |
| 11,639 |
| 11,706 |
| 13,802 |
| 11,008 |
| 10,159 |
| Noninterest income |
| 1,942 |
| 1,780 |
| 1,509 |
| 1,490 |
| 1,552 |
| Noninterest expense |
| 9,482 |
| 8,800 |
| 9,364 |
| 8,991 |
| 8,112 |
| Income before income taxes |
| 4,099 |
| 4,686 |
| 5,947 |
| 3,507 |
| 3,599 |
| Income tax expense |
| 500 |
| 569 |
| 792 |
| 507 |
| 570 |
| Net income attributable to the Company |
| $ |
| 3,599 |
| $ |
| 4,117 |
| $ |
| 5,155 |
| $ |
| 3,000 |
| $ |
| 3,029 |
| SBA Lending Segment (Q2): |
| Net interest income (5) |
| $ |
| 1,875 |
| $ |
| 2,455 |
| $ |
| 2,510 |
| $ |
| 3,227 |
| $ |
| 2,147 |
| Provision (credit) for loan losses |
| 670 |
| 197 |
| (329 |
| ) |
| 181 |
| (34 |
| ) |
| Net interest income after provision (credit) for loan losses |
| 1,205 |
| 2,258 |
| 2,839 |
| 3,046 |
| 2,181 |
| Noninterest income |
| 1,901 |
| 2,194 |
| 2,675 |
| 3,407 |
| 1,385 |
| Noninterest expense |
| 2,236 |
| 1,973 |
| 2,206 |
| 2,449 |
| 2,746 |
| Income before income taxes |
| 870 |
| 2,479 |
| 3,308 |
| 4,004 |
| 820 |
| Income tax expense |
| 265 |
| 612 |
| 790 |
| 1,005 |
| 105 |
| Net income |
| 605 |
| 1,867 |
| 2,518 |
| 2,999 |
| 715 |
| Less: net income attributable to noncontrolling interests |
| - |
| - |
| - |
| - |
| 402 |
| Net income attributable to the Company (6) |
| $ |
| 605 |
| $ |
| 1,867 |
| $ |
| 2,518 |
| $ |
| 2,999 |
| $ |
| 313 |
| Mortgage Banking Segment: |
| Net interest income |
| $ |
| 533 |
| $ |
| 452 |
| $ |
| 318 |
| $ |
| 439 |
| $ |
| 731 |
| Provision for loan losses |
| - |
| - |
| - |
| - |
| - |
| Net interest income after provision for loan losses |
| 533 |
| 452 |
| 318 |
| 439 |
| 731 |
| Noninterest income |
| 12,748 |
| 12,521 |
| 14,601 |
| 34,076 |
| 43,246 |
| Noninterest expense |
| 13,134 |
| 14,331 |
| 19,049 |
| 27,844 |
| 33,544 |
| Income (loss) before income taxes |
| 147 |
| (1,358 |
| ) |
| (4,130 |
| ) |
| 6,671 |
| 10,433 |
| Income tax expense (benefit) |
| 46 |
| (223 |
| ) |
| (765 |
| ) |
| 2,183 |
| 3,852 |
| Net income (loss) attributable to the Company |
| $ |
| 101 |
| $ |
| (1,135 |
| ) |
| $ |
| (3,365 |
| ) |
| $ |
| 4,488 |
| $ |
| 6,581 |
| Net Income (Loss) Per Share by Segment |
| Net income per share, basic - Core Banking |
| $ |
| 0.50 |
| $ |
| 0.58 |
| $ |
| 0.73 |
| $ |
| 0.42 |
| $ |
| 0.43 |
| Net income per share, basic - SBA Lending (Q2) (7) |
| 0.09 |
| 0.26 |
| 0.35 |
| 0.42 |
| 0.04 |
| Net income (loss) per share, basic - Mortgage Banking |
| 0.01 |
| (0.16 |
| ) |
| (0.47 |
| ) |
| 0.64 |
| 0.93 |
| Total net income per share, basic (7) |
| $ |
| 0.60 |
| $ |
| 0.68 |
| $ |
| 0.61 |
| $ |
| 1.48 |
| $ |
| 1.40 |
| Net Income (Loss) Per Diluted Share by Segment |
| Net income per share, diluted - Core Banking |
| $ |
| 0.50 |
| $ |
| 0.57 |
| $ |
| 0.72 |
| $ |
| 0.42 |
| $ |
| 0.42 |
| Net income per share, diluted - SBA Lending (Q2) (8) |
| 0.09 |
| 0.26 |
| 0.35 |
| 0.42 |
| 0.04 |
| Net income (loss) per share, diluted - Mortgage Banking |
| 0.01 |
| (0.16 |
| ) |
| (0.47 |
| ) |
| 0.62 |
| 0.93 |
| Total net income per share, diluted (8) |
| $ |
| 0.60 |
| $ |
| 0.67 |
| $ |
| 0.60 |
| $ |
| 1.46 |
| $ |
| 1.39 |
| (5) Includes net interest income derived from PPP loans of: |
| $ |
| 550 |
| $ |
| 1,145 |
| $ |
| 1,220 |
| $ |
| 1,887 |
| $ |
| 928 |
| (6) Includes net income attributable to the Company derived from PPP loans (tax effected) of: |
| $ |
| 413 |
| $ |
| 859 |
| $ |
| 915 |
| $ |
| 1,415 |
| $ |
| 810 |
| (7) Includes basic net income per share derived from PPP loans (tax effected) of: |
| $ |
| 0.06 |
| $ |
| 0.12 |
| $ |
| 0.13 |
| $ |
| 0.20 |
| $ |
| 0.11 |
| (8) Includes diluted net income per share derived from PPP loans (tax effected) of: |
| $ |
| 0.06 |
| $ |
| 0.12 |
| $ |
| 0.13 |
| $ |
| 0.20 |
| $ |
| 0.11 |
| SUMMARIZED FINANCIAL INFORMATION (UNAUDITED) (CONTINUED): |
| Three Months Ended |
| Noninterest Expense Detail by Segment |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| (In thousands) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Core Banking Segment: |
| Compensation (9) |
| $ |
| 5,776 |
| $ |
| 5,220 |
| $ |
| 5,039 |
| $ |
| 4,895 |
| $ |
| 4,127 |
| Occupancy |
| 1,357 |
| 1,415 |
| 1,473 |
| 1,387 |
| 1,392 |
| Advertising |
| 232 |
| 268 |
| 213 |
| 248 |
| 177 |
| Other |
| 2,117 |
| 1,897 |
| 2,639 |
| 2,461 |
| 2,416 |
| Total Noninterest Expense |
| $ |
| 9,482 |
| $ |
| 8,800 |
| $ |
| 9,364 |
| $ |
| 8,991 |
| $ |
| 8,112 |
| SBA Lending Segment (Q2): |
| Compensation |
| $ |
| 1,685 |
| $ |
| 1,602 |
| $ |
| 1,697 |
| $ |
| 1,929 |
| $ |
| 2,280 |
| Occupancy |
| 78 |
| 83 |
| 101 |
| 129 |
| 93 |
| Advertising |
| 9 |
| 6 |
| 3 |
| 8 |
| 10 |
| Other |
| 464 |
| 282 |
| 405 |
| 383 |
| 363 |
| Total Noninterest Expense |
| $ |
| 2,236 |
| $ |
| 1,973 |
| $ |
| 2,206 |
| $ |
| 2,449 |
| $ |
| 2,746 |
| Mortgage Banking Segment: |
| Compensation (9) |
| $ |
| 9,830 |
| $ |
| 11,456 |
| $ |
| 14,594 |
| $ |
| 22,657 |
| $ |
| 27,455 |
| Occupancy |
| 678 |
| 723 |
| 1,012 |
| 998 |
| 1,100 |
| Advertising |
| 551 |
| 588 |
| 1,133 |
| 1,796 |
| 2,124 |
| Other |
| 2,075 |
| 1,564 |
| 2,310 |
| 2,393 |
| 2,865 |
| Total Noninterest Expense |
| $ |
| 13,134 |
| $ |
| 14,331 |
| $ |
| 19,049 |
| $ |
| 27,844 |
| $ |
| 33,544 |
| Three Months Ended |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| Mortgage Banking Noninterest Expense Fixed vs. Variable |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| (In thousands) |
| Noninterest Expense - Fixed Expenses |
| $ |
| 7,752 |
| $ |
| 7,779 |
| $ |
| 9,764 |
| $ |
| 11,713 |
| $ |
| 13,296 |
| Noninterest Expense - Variable Expenses (10) |
| 5,382 |
| 6,552 |
| 9,285 |
| 16,131 |
| 20,248 |
| Total Noninterest Expense |
| $ |
| 13,134 |
| $ |
| 14,331 |
| $ |
| 19,049 |
| $ |
| 27,844 |
| $ |
| 33,544 |
| Three Months Ended |
| SBA Lending (Q2) Data |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| (In thousands, except percentage data) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Final funded loans guaranteed portion sold, SBA |
| $ |
| 14,131 |
| $ |
| 14,894 |
| $ |
| 17,969 |
| $ |
| 29,883 |
| $ |
| 14,116 |
| Gross gain on sales of loans, SBA |
| $ |
| 1,841 |
| $ |
| 2,134 |
| $ |
| 2,551 |
| $ |
| 3,858 |
| $ |
| 1,698 |
| Weighted average gross gain on sales of loans, SBA |
| 13.03 |
| % |
| 14.33 |
| % |
| 14.20 |
| % |
| 12.91 |
| % |
| 12.03 |
| % |
| Net gain on sales of loans, SBA (11) |
| $ |
| 1,636 |
| $ |
| 1,912 |
| $ |
| 2,322 |
| $ |
| 3,239 |
| $ |
| 1,267 |
| Weighted average net gain on sales of loans, SBA |
| 11.58 |
| % |
| 12.84 |
| % |
| 12.92 |
| % |
| 10.84 |
| % |
| 8.98 |
| % |
| Three Months Ended |
| Mortgage Banking Data |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| (In thousands, except percentage data) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Mortgage originations for sale in the secondary market |
| $ |
| 541,074 |
| $ |
| 579,458 |
| $ |
| 739,502 |
| $ |
| 1,344,873 |
| $ |
| 1,430,628 |
| Mortgage sales |
| $ |
| 587,928 |
| $ |
| 651,180 |
| $ |
| 716,425 |
| $ |
| 1,476,198 |
| $ |
| 1,349,044 |
| Gross gain on sales of loans, mortgage banking |
| $ |
| 12,257 |
| $ |
| 15,433 |
| $ |
| 11,765 |
| $ |
| 27,606 |
| $ |
| 47,224 |
| Weighted average gross gain on sales of loans, mortgage banking |
| 2.08 |
| % |
| 2.37 |
| % |
| 1.64 |
| % |
| 1.87 |
| % |
| 3.50 |
| % |
| Mortgage banking income (12) |
| $ |
| 12,744 |
| $ |
| 12,538 |
| $ |
| 14,616 |
| $ |
| 34,095 |
| $ |
| 43,229 |
| (9) Compensation includes increases for Core Banking and corresponding decreases for Mortgage Banking segments that represent intersegment allocations for loans originated by the Mortgage Banking segment to be held for investment in the Core Banking loan portfolio of: |
| $ |
| 975 |
| $ |
| 678 |
| $ |
| - |
| $ |
| - |
| - |
| $ |
| - |
| (10) Variable expenses represent incentive compensation and advertising expenses. |
| (11) Net of commissions, referral fees, SBA repair fees and discounts on unguaranteed portions held-for-investment, and inclusive of gains on servicing assets. |
| (12) Net of lender credits and other investor expenses, and inclusive of servicing income, loan fees, gains on mortgage servicing rights, fair value adjustments and gains (losses) on derivative instruments. |
| SUMMARIZED FINANCIAL INFORMATION (UNAUDITED) (CONTINUED): |
| Three Months Ended |
| Summarized Consolidated Average Balance Sheets |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| (In thousands) |
| 2021 |
| 2021 |
| 2021 |
| 2021 |
| 2020 |
| Interest-earning assets |
| Average balances: |
| Interest-bearing deposits with banks |
| $ |
| 33,065 |
| $ |
| 63,217 |
| $ |
| 37,683 |
| $ |
| 48,035 |
| $ |
| 34,412 |
| Loans, excluding PPP |
| 1,221,879 |
| 1,194,277 |
| 1,155,958 |
| 1,217,398 |
| 1,205,278 |
| PPP loans |
| 51,178 |
| 84,288 |
| 145,227 |
| 164,533 |
| 179,316 |
| Investment securities - taxable |
| 47,717 |
| 46,005 |
| 46,392 |
| 42,424 |
| 42,462 |
| Investment securities - nontaxable |
| 153,452 |
| 148,723 |
| 148,280 |
| 146,145 |
| 146,374 |
| FRB and FHLB stock |
| 19,258 |
| 19,258 |
| 19,258 |
| 19,294 |
| 17,992 |
| Total interest-earning assets |
| $ |
| 1,526,549 |
| $ |
| 1,555,768 |
| $ |
| 1,552,798 |
| $ |
| 1,637,829 |
| $ |
| 1,625,834 |
| Interest income (tax equivalent basis): |
| Interest-bearing deposits with banks |
| $ |
| 14 |
| $ |
| 23 |
| $ |
| 14 |
| $ |
| 18 |
| $ |
| 18 |
| Loans, excluding PPP |
| 13,424 |
| 13,279 |
| 13,017 |
| 13,033 |
| 13,171 |
| PPP loans |
| 595 |
| 1,219 |
| 1,347 |
| 2,031 |
| 1,085 |
| Investment securities - taxable |
| 405 |
| 421 |
| 447 |
| 432 |
| 471 |
| Investment securities - nontaxable |
| 1,509 |
| 1,482 |
| 1,496 |
| 1,487 |
| 1,508 |
| FRB and FHLB stock |
| 149 |
| 146 |
| 161 |
| 167 |
| 108 |
| Total interest income (tax equivalent basis) |
| $ |
| 16,096 |
| $ |
| 16,570 |
| $ |
| 16,482 |
| $ |
| 17,168 |
| $ |
| 16,361 |
| Weighted average yield (tax equivalent basis, annualized): |
| Interest-bearing deposits with banks |
| 0.17 |
| % |
| 0.15 |
| % |
| 0.15 |
| % |
| 0.15 |
| % |
| 0.21 |
| % |
| Loans, excluding PPP |
| 4.39 |
| % |
| 4.45 |
| % |
| 4.50 |
| % |
| 4.28 |
| % |
| 4.37 |
| % |
| PPP loans |
| 4.65 |
| % |
| 5.78 |
| % |
| 3.71 |
| % |
| 4.94 |
| % |
| 2.42 |
| % |
| Investment securities - taxable |
| 3.40 |
| % |
| 3.66 |
| % |
| 3.85 |
| % |
| 4.07 |
| % |
| 4.44 |
| % |
| Investment securities - nontaxable |
| 3.93 |
| % |
| 3.99 |
| % |
| 4.04 |
| % |
| 4.07 |
| % |
| 4.12 |
| % |
| FRB and FHLB stock |
| 3.09 |
| % |
| 3.03 |
| % |
| 3.34 |
| % |
| 3.46 |
| % |
| 2.40 |
| % |
| Total interest-earning assets |
| 4.22 |
| % |
| 4.26 |
| % |
| 4.25 |
| % |
| 4.19 |
| % |
| 4.03 |
| % |
| Interest-bearing liabilities |
| Average balances: |
| Interest-bearing deposits |
| $ |
| 913,297 |
| $ |
| 935,800 |
| $ |
| 807,342 |
| $ |
| 840,556 |
| $ |
| 811,016 |
| Federal Home Loan Bank borrowings |
| 264,617 |
| 255,210 |
| 272,834 |
| 293,819 |
| 306,299 |
| Federal Reserve PPPLF borrowings |
| - |
| 11,937 |
| 114,453 |
| 158,354 |
| 173,701 |
| Subordinated debt and other borrowings |
| 19,870 |
| 19,853 |
| 19,836 |
| 19,786 |
| 19,803 |
| Total interest-bearing liabilities |
| $ |
| 1,197,784 |
| $ |
| 1,222,800 |
| $ |
| 1,214,465 |
| $ |
| 1,312,515 |
| $ |
| 1,310,819 |
| Interest expense: |
| Interest-bearing deposits |
| $ |
| 811 |
| $ |
| 765 |
| $ |
| 723 |
| $ |
| 771 |
| $ |
| 936 |
| Federal Home Loan Bank borrowings |
| 730 |
| 725 |
| 780 |
| 833 |
| 861 |
| Federal Reserve PPPLF borrowings |
| - |
| 12 |
| 98 |
| 137 |
| 153 |
| Subordinated debt and other borrowings |
| 318 |
| 319 |
| 320 |
| 319 |
| 337 |
| Total interest expense |
| $ |
| 1,859 |
| $ |
| 1,821 |
| $ |
| 1,921 |
| $ |
| 2,060 |
| $ |
| 2,287 |
| Weighted average cost (annualized): |
| Interest-bearing deposits |
| 0.36 |
| % |
| 0.33 |
| % |
| 0.36 |
| % |
| 0.37 |
| % |
| 0.46 |
| % |
| Federal Home Loan Bank borrowings |
| 1.10 |
| % |
| 1.14 |
| % |
| 1.14 |
| % |
| 1.13 |
| % |
| 1.12 |
| % |
| Federal Reserve PPPLF borrowings |
| 0.00 |
| % |
| 0.40 |
| % |
| 0.34 |
| % |
| 0.35 |
| % |
| 0.35 |
| % |
| Subordinated debt and other borrowings |
| 6.40 |
| % |
| 6.43 |
| % |
| 6.45 |
| % |
| 6.45 |
| % |
| 6.81 |
| % |
| Total interest-bearing liabilities |
| 0.62 |
| % |
| 0.60 |
| % |
| 0.63 |
| % |
| 0.63 |
| % |
| 0.70 |
| % |
| Interest rate spread (tax equivalent basis, annualized) |
| 3.60 |
| % |
| 3.66 |
| % |
| 3.62 |
| % |
| 3.56 |
| % |
| 3.33 |
| % |
| Net interest margin (tax equivalent basis, annualized) |
| 3.73 |
| % |
| 3.79 |
| % |
| 3.75 |
| % |
| 3.69 |
| % |
| 3.46 |
| % |
| Net interest margin, excluding PPP and PPPLF (non-GAAP), (tax equivalent basis, annualized) |
| 3.70 |
| % |
| 3.68 |
| % |
| 3.78 |
| % |
| 3.59 |
| % |
| 3.63 |
| % |