Exhibit 99.2
United Bancshares, Inc.
Quarterly Report
March 31, 2020
Shareholders, Clients and Team Members:
The year started with optimism to continue your Company’s growth in deposits, loans, non-interest income and overall profitability, however the pandemic quickly adjusted management’s focus to the safety of our team members, their families, and our communities. While we relocated most of our operational team members to their homes, we continued to service all our clients at branch locations via drive-up facilities and online services. We then quickly pivoted to allocate resources to give our clients and communities the opportunity to get assistance through the Paycheck Protection Program. As a result of those efforts, we expect to make over 1,100 loans for more than $110 million dollars, which will greatly support our communities as they recover from this crisis.
Although it is still unclear how long our communities will remain in lock down, or the depth or length of the economic impact on our economy, your Company entered this down-turn with strong liquidity, asset quality metrics, profitability, and capital. While we have not experienced increases in loan delinquencies or charge-offs through the end of the first quarter, management believed it was prudent to allocate an additional $550,000 to the Bank’s allowance for loan losses. This, along with a $243,000 decrease in the fair value of mortgage servicing rights, negatively affected your Company’s profitability for the quarter ended March 31, 2020. Despite these significant head winds, your Company reported approximately $1.1 million in net income for the first quarter. I am also pleased to report that your board has approved a $.07 per common share dividend, payable on June 15th to shareholders of record at the close of business on May 29th.
Despite the pandemic’s significant overall negative impact on our financial performance, the Company continues to experience positives in deposit growth, residential mortgage activity and most importantly the continued commitment of my fellow team members, who remain committed to serving others in this time of need. Their extraordinary efforts and our strong corporate values of respect for and accountability to our shareholders, clients, colleagues, and communities are the foundation for the continued success of your Company. Thank you for your ongoing support and the trust you have placed in us.
Respectfully,
Brian D. Young
President and CEO
United Bancshares, Inc.
and Subsidiaries
Financial Information (unaudited) | | Three months ended March 31, 2020 | | | Three months ended March 31, 2019 | |
| | | (dollars in thousands, except per share data) | |
Condensed Statement of Income | | | | | | | | |
Interest income | | $ | 9,232 | | | $ | 8,986 | |
Interest expense | | | 2,108 | | | | 2,051 | |
Net interest income | | | 7,124 | | | | 6,935 | |
Provision for loan losses | | | 550 | | | | 100 | |
Net interest income after provision for loan losses | | | 6,574 | | | | 6,835 | |
Non-interest income | | | 2,834 | | | | 2,508 | |
Non-interest expenses | | | 8,210 | | | | 7,222 | |
Income before income taxes | | | 1,198 | | | | 2,121 | |
Provision for income taxes | | | 110 | | | | 307 | |
Net income | | $ | 1,088 | | | $ | 1,814 | |
| | | | | | | | | |
Average common shares outstanding (basic) | | | 3,270,066 | | | | 3,270,408 | |
| | | | | | | | | |
PER COMMON SHARE | | | | | | | | |
Net income | | $ | 0.33 | | | $ | 0.55 | |
Book value | | $ | 30.11 | | | $ | 25.82 | |
Tangible book value (non-GAAP)* | | $ | 21.13 | | | $ | 16.79 | |
Closing price | | $ | 16.25 | | | $ | 23.11 | |
| | | | | | | | | |
FINANCIAL RATIOS | | | | | | | | |
Return on average assets | | | 0.49 | % | | | 0.87 | % |
Return on average tangible equity (non-GAAP)* | | | 6.41 | % | | | 13.86 | % |
Net interest margin | | | 3.61 | % | | | 3.81 | % |
Efficiency ratio | | | 81.14 | % | | | 74.76 | % |
Loans (including held for sale) to deposits | | | 81.86 | % | | | 83.63 | % |
PERIOD END BALANCES
| | | As of March 31, 2020 | | | As of March 31, 2019 | |
Assets | | $ | 902,457 | | | $ | 852,231 | |
Loans, gross | | $ | 573,981 | | | $ | 565,987 | |
Deposits | | $ | 725,136 | | | $ | 689,254 | |
Shareholders' equity | | $ | 98,482 | | | $ | 84,433 | |
| | | | | | | | | |
Common shares outstanding | | | 3,270,399 | | | | 3,270,635 | |
* Tangible book value per share is calculated by dividing tangible equity by average shares outstanding.
Reconciliation of shareholders' equity to tangible equity |
| | | March 31, 2020 | | | March 31, 2019 | |
Shareholders' equity | | $ | 98,482 | | | $ | 84,433 | |
Less goodwill and other intangibles | | | 29,372 | | | | 29,529 | |
Tangible common equity | | $ | 69,110 | | | $ | 54,904 | |
Average Shareholders' equity | | $ | 97,336 | | | $ | 81,900 | |
Less average goodwill and other intangibles | | | 29,386 | | | | 29,546 | |
Average tangible common equity | | $ | 67,950 | | | $ | 52,354 | |
UNITED BANCSHARES, INC.
DIRECTORS Robert L. Benroth Herbert H. Huffman H. Edward Rigel David P. Roach | Daniel W. Schutt – Chairman R. Steven Unverferth Brian D. Young |
OFFICERS
Brian D. Young - President/CEO
Heather M. Oatman - Secretary
Stacy A. Cox – Chief Financial Officer
THE UNION BANK COMPANY
DIRECTORS
Robert L. Benroth Anthony M.V. Eramo Herbert H. Huffman Kevin L. Lammon William R. Perry | H. Edward Rigel David P. Roach Carol R. Russell Daniel W. Schutt R. Steven Unverferth |
Brian D. Young - Chairman/President/CEO |
INVESTOR MATERIALS:
United Bancshares, Inc. has traded its common stock on the NASDAQ Markets Exchange under the symbol “UBOH” since March 2001. Annual and quarterly shareholder reports, regulatory filings, press releases, and articles about United Bancshares, Inc. are available in the Shareholder Information section of our website www.theubank.com or by calling 1-800-837-8111.
Locations
1300 N. Main St.
Bowling Green, OH 43402
419-353-6088
100 S. High St.
Columbus Grove, OH 45830
419-659-2141
101 Progressive Dr.
Columbus Grove, OH 45830
419-659-4250
30 Coal Bend
Delaware, OH 43015
740-549-3400
114 E. 3rd St.
Delphos, OH 45833
419-692-2010
1500 Bright Rd.
Findlay, OH 45840
419-424-1400
461 Beecher Road
Gahanna, OH 43230
614-269-4400
230 W. Madison St.
Gibsonburg, OH 43431
419-637-2124
110 E. North St.
Kalida, OH 45853
419-532-3366
318 S. Belmore St.
Leipsic, OH 45856
419-943-2171
1410 Bellefontaine Ave.
Lima, OH 45804
419-229-6500
3211 Elida Rd.
Lima, OH 45805
419-331-3211
701 Shawnee Rd.
Lima, OH 45805
419-228-2114
111 S. Main St.
Marion, OH 43302
740-387-2265
220 Richland Rd.
Marion, OH 43302
740-386-2171
245 W. Main St.
Ottawa, OH 45875
419-523-2265
132 E. Front St.
Pemberville, OH 43450
419-287-3211
2660 US Hwy 224, Ste. 3
Plymouth, OH 44865
419-659-2141
468 Polaris Parkway
Westerville, OH 43082
614-269-4402
