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home / news releases / TRUX - Truxton Corporation Reports Fourth Quarter 2020 Results

TRUX - Truxton Corporation Reports Fourth Quarter 2020 Results

Truxton Corp

NASHVILLE, Tenn., Jan. 28, 2021 (GLOBE NEWSWIRE) -- Truxton Corporation (OTCPK: TRUX), the parent company for Truxton Trust Company (“Truxton” or “the Bank”) and subsidiaries, announced its operating results for the quarter ended December 31, 2020. Fourth quarter net income attributable to common shareholders was $3.5 million or $1.23 per diluted share compared to $2.5 million or $0.88 per diluted share for the same quarter in 2019. Net income increased by 43.2% and earnings per diluted share increased by 39.7% for the quarter compared to the fourth quarter of 2019. For the twelve months ended December 31, 2020, net income increased by 14.4% to $11.1 million from $9.7 million in the comparable period in 2019. For the twelve months ended December 31, 2020, earnings per diluted share rose to $3.90 from $3.46, an increase of 12.7% from the comparable period in 2019.

During the fourth quarter, Truxton received notice from the Small Business Administration (SBA) that 134 loans totaling $22.2 million had been forgiven under the terms of the Paycheck Protection Program (PPP). Truxton recognized as income in the quarter the unamortized fees associated with these loans. In the quarter ended December 31, 2020, Truxton recognized $670 thousand of income from PPP fees. As of December 31, 2020, Truxton had $24.5 million in PPP loans outstanding with $429 thousand in unamortized fees. In addition, Truxton made loans in the quarter which qualify for tax credits under the Community Investment Tax Credit (CITC) program of the State of Tennessee. These credits reduced Truxton’s state tax provision by $325 thousand in the final quarter of 2020.

Chairman and CEO Tom Stumb remarked, “Truxton appreciates the patience and loyalty of our clients and the courage and dedication of our remarkable team of employees during a trying year. We were able to deliver a 16.1% return on our average equity capital (ROAE) for the full year, the highest in our history because Truxton performed superbly for clients throughout the year. Whether it was working nights and weekends to master the intricacies of the PPP loan program, or assisting families in managing wealth during a period of economic and political uncertainty, the Truxton team enhanced business and personal relationships with wonderful families and the businesses they own.”

Key Highlights

  • Wealth management revenue rose 19.5% in the fourth quarter of 2020 compared to the fourth quarter of 2019. Wealth management services constituted 95% of non-interest income in the fourth quarter ended December 31, 2020.
  • Loans rose by 15.4% to $420 million compared to December 31, 2019 and were up 1.3% compared to September 30, 2020.
  • We ended the fourth quarter with $24.5 million in loans outstanding pursuant to the Paycheck Protection Program (PPP) provisions of the CARES Act. These loans assisted our small business clients in covering payrolls and other essential costs during the pandemic period.
  • Total deposits grew to $624 million or 39.3% since December 31, 2019, inclusive of deposits added as a result of funding PPP loans and new business growth. Truxton continues to fund its growth from a single banking location through superior deposit operations service and technology. As a result, occupancy expenditures and fixed asset investments are significantly less than many of our peers.
  • Net interest margin for the fourth quarter of 2020 was 2.95%. That represents an increase of 11 basis points from the 2.84% experienced in the quarter ended September 30, 2020, and a decline of 26 basis points from the quarter ended December 31, 2019. Cost of funds increased to 0.47% in the fourth quarter of 2020 from 0.35% for the quarter ended September 30, 2020 but declined from 0.95% for the quarter ended December 31, 2019. Net interest margin was negatively impacted by the PPP loans, which carry a 1% interest rate.
  • Asset quality remains sound at Truxton. Truxton had $2.0 million in non-performing assets at December 31, 2020, up from $0 at December 31, 2019. A single residential mortgage comprises over 95% of our non-performing loans.
  • Provision for loan losses was $228 thousand for the quarter ended December 31, 2020, an increase from no provision in the same quarter in 2019 and down from $262 thousand in the quarter ended September 30, 2020. Allowance for loan losses was $4.5 million, $4.3 million, and $3.4 million as of December 31, 2020, September 30, 2020, and December 31, 2019, respectively. For the three periods, the bank’s allowance was 1.07%, 1.03%, and 0.94%, of gross loans outstanding at period end, respectively. There is no allowance associated with the $24.5 million of PPP loans outstanding at December 31, 2020.
  • The Bank’s capital position remains strong. Tier 1 leverage ratio was 9.38% at December 31, 2020, 9.43% at September 30, 2020, and 11.30% at December 31, 2019. The reduction in Tier 1 leverage ratio for the year was principally the result of the significant asset growth experienced in the year. Book value per common share was $26.77, $25.27, and $22.84 at December 31, 2020, September 30, 2020, and December 31, 2019, respectively. During the 12 months ended December 31, 2020, Truxton Corporation paid dividends of $2.12 per common share.
  • With the onset of the pandemic in March 2020, Truxton began providing borrowers interest and/or principal payment deferrals for up to 180 days in an amount eventually impacting $63.6 million in loans, or 17% of non-PPP total loan balances.  As of December 31, 2020, those loans still receiving borrower payment deferrals totaled $5.8 million or 1.47% of non-PPP loans.

About Truxton Trust
Truxton Trust Company is a provider of private banking, wealth management, trust, and family office services for wealthy individuals, their families and their business interests. Serving clients across the world, Truxton’s vastly experienced team of professionals provides customized solutions to its clients’ complex financial needs. Founded in 2004 in Nashville, Tennessee, Truxton Trust upholds its original guiding principle: do the right thing. Truxton Trust Company is a subsidiary of financial holding company, Truxton Corporation (OTCPK: TRUX). For more information, visit truxtontrust.com.

Investor Relations
Media Relations
Andrew May
Tamara Schoeplein
615-515-1707
615-515-1714
andrew.may@truxtontrust.com
tamara.schoeplein@truxtontrust.com



Truxton Corporation
Consolidated Balance Sheets
(000's)
December 31,
2020*
September 30,
2020*
December 31,
2019*
ASSETS
Cash and due from financial institutions
$
9,742
$
12,772
$
8,868
Interest bearing deposits in other financial institutions
84,429
90,836
19,519
Federal funds sold
169
2,223
8,808
Cash and cash equivalents
94,340
105,831
37,195
Time deposits in other financial institutions
2,687
2,938
5,157
Securities available for sale
206,318
156,558
116,032
Gross loans, excluding Paycheck Protection Program (PPP) Loans
395,106
367,689
363,784
PPP Loans
24,522
46,684
-
Allowance for loan losses
(4,490
)
(4,257
)
(3,409
)
Net loans
415,138
410,116
360,375
Mortgage loans held for sale, net
-
-
350
Bank owned life insurance
10,185
10,132
9,973
Restricted equity securities
3,214
3,206
2,599
Premises and equipment, net
507
538
273
Accrued interest receivable
2,653
2,850
1,842
Deferred tax asset, net
-
106
520
Other assets
6,576
7,044
4,448
Total assets
$
741,618
$
699,319
$
538,764
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Non-interest bearing
$
170,251
$
150,083
$
119,999
Interest bearing
453,774
388,959
328,077
Total deposits
624,025
539,042
448,076
Federal Home Loan Bank advances
17,673
17,867
18,411
Paycheck Protection Program Liquidity Facility advances
-
46,639
-
Subordinated debt
14,529
14,574
-
Deferred tax liability, net
479
-
-
Other liabilities
8,254
9,527
8,914
Total liabilities
664,960
627,649
475,401
SHAREHOLDERS' EQUITY
Additional paid-in capital
31,651
30,832
29,770
Retained earnings
41,433
38,696
33,511
Accumulated other comprehensive income
3,574
2,142
82
Total shareholders' equity
76,658
71,670
63,363
Total liabilities and shareholders' equity
$
741,618
$
699,319
$
538,764
*The information is unaudited and based on company data available at the time of presentation.



Truxton Corporation
Consolidated Statements of Net Income
(000's)
Three Months Ended
Year Ended
December 31,
2020*
September 30,
2020*
December 31,
2019*
December 31,
2020
December 31,
2019
Non-interest income
Wealth management services
$
3,101
$
2,832
$
2,596
$
11,469
$
10,746
Service charges on deposit accounts
59
59
82
256
303
Securities gains, net
-
-
-
-
131
Bank owned life insurance income
53
53
54
212
218
Other
65
15
57
262
271
Total non-interest income
3,278
2,959
2,789
12,199
11,669
Gross loans, excluding Paycheck Protection Program (PPP) Loans
0
PPP Loans
$
4,616
$
4,126
$
4,062
$
17,201
$
16,083
Taxable securities
646
472
584
2,137
2,060
Tax-exempt securities
347
299
196
1,088
887
Interest bearing deposits
79
90
125
332
744
Federal funds sold
1
2
8
19
34
Other interest income
35
13
45
94
153
Total interest income
5,724
5,002
5,020
20,871
19,961
Interest expense
Deposits
451
389
984
1,941
4,120
Short-term borrowings
-
-
1
-
17
Subordinated debentures
194
-
-
194
-
Long-term borrowings
115
134
90
468
412
Total interest expense
760
523
1,075
2,603
4,549
Net interest income
4,964
4,479
3,945
18,268
15,412
Provision for loan losses
228
262
0
1,093
55
Net interest income after provision for loan losses
4,736
4,217
3,945
17,175
15,357
Total Revenue, net
8,014
7,176
6,734
29,374
27,026
Non interest expense
Salaries and employee benefits
2,872
2,781
2,671
11,380
10,699
Occupancy
219
228
200
868
808
Furniture and equipment
46
46
27
153
108
Data processing
319
296
342
1,169
1,209
Wealth management processing fees
163
102
126
520
462
Advertising and public relations
66
30
121
163
198
Professional services
112
190
211
626
596
FDIC insurance assessments
52
45
(73
)
150
32
Other
168
238
195
887
879
Total non interest expense
4,017
3,956
3,820
15,916
14,991
Income before income taxes
3,997
3,220
2,914
13,458
12,035
Income tax expense
457
693
441
2,309
2,293
Net income
$
3,540
$
2,527
$
2,473
$
11,149
$
9,742
Earnings per share:
Basic
$
1.25
$
0.89
$
0.89
$
3.94
$
3.53
Diluted
$
1.23
$
0.88
$
0.88
$
3.90
$
3.46
*The information is unaudited and based on company data available at the time of presentation.



Truxton Corporation
Selected Quarterly Financial Data
at or for the Three Months Ended
(000's)
December 31, 2020*
September 30, 2020*
December 31, 2019*
Per Common Share Data
Net income attributable to shareholders, per share
Basic
$1.25
$0.89
$0.89
Diluted
$1.23
$0.88
$0.88
Book value per common share
$26.77
$25.27
$22.84
Tangible book value per common share
$26.77
$25.27
$22.84
Basic weighted average common shares
2,768,270
2,758,375
2,699,777
Gross loans, excluding Paycheck Protection Program (PPP) Loans
2,794,461
2,789,562
2,754,101
PPP Loans
2,863,671
2,836,451
2,774,655
Selected Balance Sheet Data
Tangible common equity (TEC) ratio
10.34%
10.32%
11.76%
Average loans
$420,106
$413,716
$348,635
Average earning assets (1)
$683,594
$642,326
$492,829
Average total assets
$719,206
$677,985
$518,902
Average stockholders' equity
$73,764
$71,183
$65,457
Selected Asset Quality Measures
Nonaccrual loans
$2,017
$2,044
0
90+ days past due still accruing
$11
$0
0
Total nonperforming loans
$2,017
$2,044
0
Total nonperforming assets
$2,017
$2,044
0
Net charge offs (recoveries)
$12
$0
$1
Nonperforming loans to assets
0.27%
0.29%
0.00%
Nonperforming assets to total assets
0.27%
0.29%
0.00%
Nonperforming assets to total loans and other real estate
0.48%
0.49%
0.00%
Allowance for loan losses to gross loans
1.07%
1.03%
0.94%
Net charge offs (recoveries) to average loans
0.00%
0.00%
0.00%
Capital Ratios (Bank Subsidiary Only)
Tier 1 leverage
9.38%
9.43%
11.30%
Common equity tier 1
14.10%
14.60%
13.70%
Total risk-based capital
15.05%
15.58%
14.51%
Selected Performance Ratios
Efficiency ratio
46.95%
53.01%
55.67%
Return on average assets (ROA)
1.96%
1.48%
1.89%
Return on average stockholders' equity (ROE)
19.09%
14.12%
15.77%
Return on tangible common equity (ROTCE)
19.09%
14.12%
15.77%
Net interest margin
2.95%
2.84%
3.21%
*The information is unaudited and based on company data available at the time of presentation.
(1) Average earning assets is the daily average of earning assets. Earning assets consists of loans, mortgage loans held for sale, federal funds sold, deposits with banks, investment securities and restricted equity securities.



Truxton Corporation
Yield Tables
for the Periods Indicated
(000's)
The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest earning assets and interest bearing liabilities and the average interest rate for interest earning assets and interest bearing liabilities, net interest spread and net interest margin for the periods indicated below:
Three Months Ended
Three Months Ended
Three Months Ended
December 31, 2020*
September 30, 2020*
December 31, 2019*
Average Balances
Rates/ Yields (%)
Interest Income/ Expense
Average Balances
Rates/ Yields (%)
Interest Income/ Expense
Average Balances
Rates/ Yields (%)
Interest Income/ Expense
Earning assets
Gross loans, excluding Paycheck Protection Program (PPP) Loans
$420,106
3.75
$3,957
$413,716
3.74
$3,891
$348,635
4.60
$4,044
PPP Loans
$0
0.63
$665
$0
0.23
$240
$0
0.03
$24
Loans with fees
$420,106
4.38
$4,622
$413,716
3.97
$4,131
$348,635
4.63
$4,068
Mortgage loans held for sale
$78
3.33
$1
$0
0.00
$0
$13
3.55
$0
Federal funds sold
$2,581
0.14
$1
$4,340
0.17
$2
$1,944
1.66
$8
Deposits with banks
$77,539
0.41
$79
$83,360
0.43
$90
$25,747
1.93
$125
Investment securities - taxable
$127,864
2.02
$646
$96,081
1.96
$471
$89,614
2.61
$584
Investment securities - tax-exempt
$55,425
3.39
$347
$44,829
3.61
$299
$26,876
3.93
$196
Total earning assets
$683,593
3.39
$5,696
$642,326
3.16
$4,993
$492,829
4.07
$4,981
Non interest earning assets
Allowance for loan losses
(4,359
)
(4,122
)
(3,411
)
Cash and due from banks
$11,611
$11,256
$8,263
Premises and equipment
$500
$484
$1,623
Accrued interest receivable
$2,573
$2,502
$1,600
Other real estate
$0
$0
$0
Other assets
$20,416
$20,485
$16,343
Unrealized gain (loss) on inv. securities
4,871
5,053
1,656
Total assets
$719,205
$677,984
$518,903
Interest bearing liabilities
Interest bearing demand
$30,668
(0.08
)
($
6
)
$31,416
(0.03
)
($
3
)
$28,241
0.41
$29
Savings and money market
$487,041
0.34
$415
$454,105
0.31
$351
$349,734
0.84
$737
Time deposits - retail
$8,538
1.13
$24
$9,796
1.20
$30
$14,023
1.83
$65
Time deposits - wholesale
$22,451
0.31
$18
$15,285
0.27
$11
$8,695
6.99
$153
Total interest bearing deposits
$548,698
0.33
$451
$510,603
0.30
$389
$400,693
0.97
$984
Federal Home Loan Bank advances
$17,738
1.92
$87
$25,435
1.43
$93
$18,490
1.89
$90
Subordinated debt
$14,629
5.19
$194
$0
0.00
$0
$0
0.00
$0
Other borrowings
$31,730
1.10
$28
$48,454
0.33
$41
$1,417
0.21
$1
Total borrowed funds
$64,097
1.88
$309
$73,889
0.71
$134
$19,907
1.77
$91
Total interest bearing liabilities
$612,795
0.49
$760
$584,492
0.35
$523
$420,600
1.01
$1,074
Net interest rate spread
2.90
$4,936
2.81
$4,470
3.06
$3,907
Non-interest bearing deposits
$24,645
$14,564
$27,422
Other liabilities
$7,787
$7,745
$5,423
Shareholder's equity
$73,764
$71,183
$65,457
Total liabilities and shareholder's equity
$718,991
$677,984
$518,902
Cost of funds
0.47
0.35
0.95
Net interest margin
2.95
2.84
3.21
*The information is unaudited and based on company data available at the time of presentation.
Yield Table Assumptions - Average loan balances are inclusive of nonperforming loans. Yields computed on tax-exempt instruments are on a tax equivalent basis. Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period. Changes in net interest income are attributed to either changes in average balances or changes in average rates (rate change) for earning assets and sources of funds on which interest is received or paid.



Truxton Corporation
Yield Tables
for the Periods Indicated
(000's)
The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest earning assets and interest bearing liabilities and the average interest rate for interest earning assets and interest bearing liabilities, net interest spread and net interest margin for the periods indicated below:
Twelve Months Ended
Twelve Months Ended
December 31, 2020
December 31, 2019
Average Balances
Rates/ Yields (%)
Interest Income/ Expense
Average Balances
Rates/ Yields (%)
Interest Income/ Expense
Earning assets
Gross loans, excluding Paycheck Protection Program (PPP) Loans
$405,363
3.97
$16,099
$338,675
4.74
$16,038
PPP Loans
$0
0.28
$1,132
$0
0.03
$87
Loans with fees
$405,363
4.25
$17,231
$338,675
4.76
$16,125
Mortgage loans held for sale
$72
3.86
$3
$55
3.29
$2
Federal funds sold
$3,857
0.05
$18
$1,570
2.16
$34
Deposits with banks
$59,043
0.56
$332
$30,857
2.41
$744
Investment securities - taxable
$100,529
2.13
$2,138
$79,071
2.61
$2,060
Investment securities - tax-exempt
$40,452
3.63
$1,088
$30,856
3.89
$887
Total earning assets
$609,316
3.48
$20,810
$481,084
4.19
$19,852
Non interest earning assets
Allowance for loan losses
(3,900
)
(3,393
)
Cash and due from banks
$10,074
$7,290
Premises and equipment
$423
$1,537
Accrued interest receivable
$2,181
$1,597
Other real estate
$0
$0
Other assets
$19,973
$16,111
Unrealized gain (loss) on inv. securities
3,579
607
Total assets
$641,646
$504,833
Interest bearing liabilities
Interest bearing demand
$32,004
0.20
$65
$27,131
0.69
$187
Savings and money market
$429,755
0.39
$1,671
$342,244
1.05
$3,584
Time deposits - retail
$9,948
1.26
$126
$12,203
1.49
$181
Time deposits - wholesale
$11,369
0.69
$79
$7,131
2.35
$167
Total interest bearing deposits
$483,076
0.40
$1,941
$388,709
1.06
$4,119
Federal Home Loan Bank advances
$24,942
1.47
$372
$20,957
1.94
$412
Subordinated debt
$3,816
5.00
$194
$0
0.00
$0
Other borrowings
$28,566
1.50
$96
$1,817
0.93
$17
Total borrowed funds
$57,324
1.14
$662
$22,774
1.86
$429
Total interest bearing liabilities
$540,400
0.48
$2,603
$411,483
1.10
$4,548
Net interest rate spread
3.00
$18,207
3.09
$15,304
Non-interest bearing deposits
$24,472
$27,400
Other liabilities
$7,302
$4,141
Shareholder's equity
$69,413
$61,783
Total liabilities and shareholder's equity
$641,587
$504,807
Cost of funds
0.46
1.04
Net interest margin
3.05
3.25
Yield Table Assumptions - Average loan balances are inclusive of nonperforming loans. Yields computed on tax-exempt instruments are on a tax equivalent basis. Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period. Changes in net interest income are attributed to either changes in average balances or changes in average rates (rate change) for earning assets and sources of funds on which interest is received or paid.




Stock Information
Company Name: Truxton Corp
Stock Symbol: TRUX
Market: OTC
Website: www.truxtontrust.com
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