Exhibit 99.1
February 2, 2023 | ||||||||||||||||||||||||||
We are pleased to report financial results for the three months and year ended December 31, 2022. Consolidated net income was $12.6 million, or $2.81 per share, compared to $13.2 million, or $2.94 per share, for the year ended December 31, 2022, and 2021, respectively. The decrease in earnings was due to a decrease of $4.0 million in noninterest income, a $309 thousand increase in noninterest expenses, partially offset by an increase in net interest income of $3.7 million. Total assets at year-end 2022 were $1.3 billion compared to total assets at year-end 2021 of $1.2 billion, a 10.9% increase year over year. Total loans outstanding as of December 31, 2022, were $960.7 million compared to $801.6 million as of December 31, 2021, an increase of $159.1 million, or 19.8%. Loan growth in 2022 was due to retaining more residential loans on the balance sheet and increases in residential construction and commercial real estate loans. These increases were partially offset by a reduction of $13.4 million of PPP loans forgiven during 2022. Funding of asset growth continues to be primarily from customer deposits which increased to $1.2 billion as of December 31, 2022, compared to $1.1 billion as of December 31, 2021, an increase of $106.8 million, or 9.8%. Brokered deposits of $33.0 million were included in total deposits as of December 31, 2022, and none were outstanding as of December 31, 2021. Also, $50.0 million of Federal Home Loan Bank advances were outstanding as of December 31, 2022, to bridge funding gaps. Our net income results for 2022 were close to budgeted expectations for the year, however the economic environment changed compared to 2021. Inflation soared in late 2021, prompting the Federal Reserve to embark on a monetary tightening cycle beginning in early 2022 and continuing to this day. This caused interest rates to climb, dampening real estate markets and convincing many that a recession | is likely in 2023. The real estate market has cooled as loan rates have risen, reducing the purchasing power of consumers and businesses in our region. This has been a test of our long-term balance sheet strategy, staying asset sensitive throughout economic cycles, and counting on net interest income to increase in rising rate environments and allowing gains on real estate loans from our mortgage loan business line to bolster net income during declining rate cycles. This strategy has worked well for us over the past decade, despite the volatility during those years. We believe we are going into 2023 on solid footing. Loan demand remains sound, and asset quality is showing no signs of deterioration. Funding asset growth will be both a challenge and an area of focus during 2023. Travel and tourism remain strong despite the lack of snow. This speaks to the quality experience our tourism community offers, as well as the general strength of the traveling consumer. Primary economic challenges in our region include the lack of affordable workforce housing, high construction costs, and a dismal labor market. We are closely monitoring economic conditions and asset quality but are guardedly optimistic about 2023. At our recent Board of Directors meeting, we decided to return to an in person Annual Meeting in 2023, which is scheduled for May 17th. In addition, the Board declared a cash dividend of $0.36 per share for the quarter, an increase of 2.9% from the cash dividend of $0.35 paid in recent prior quarters, payable February 2, 2023 to shareholders of record as of January 28, 2023. | |||||||||||||||||||||||||
If you need assistance with a change in registration of certificates, combining your certificates into one, reporting lost certificates, non-receipt or loss of dividend checks, assistance regarding direct deposit of dividends, information about the Company, or to receive copies of financial reports, please contact Kristy Adams Alfieri, Assistant Secretary at 802.888.0982 or contact our Transfer Agent at the address and phone number listed below: | ||||||||||||||||||||||||||
TRANSFER AGENT: | ||||||||||||||||||||||||||
Broadridge Corporate Issuer Solutions, Inc. P.O. Box 1342 Brentwood, NY 11717 866.321.8022 or 720.378.5956 E-mail: shareholder@broadridge.com | ||||||||||||||||||||||||||
NASDAQ STOCK MARKET | ||||||||||||||||||||||||||
Ticker Symbol: UNB Corporate Name: Union Bankshares, Inc. Corporate Address: 20 Lower Main Street P.O. Box 667 Morrisville, VT 05661-0667 Investor Relations: UBLocal.com | ||||||||||||||||||||||||||
Neil J. Van Dyke Chair | David S. Silverman President & Chief Executive Officer | |||||||||||||||||||||||||
About Union Bankshares | ||||||||||||||||||||||||||
Union Bankshares, Inc. operates as the holding company for Union Bank, which provides commercial, retail and municipal banking services and asset management services throughout northern Vermont and New Hampshire. Union Bank was founded in 1891 in Morrisville, Vermont, where the Bank’s and its holding company’s headquarters are located. Union Bank operates 18 banking offices, three loan centers and several ATMs throughout its geographical footprint. Union Bank has been helping people buy homes and local businesses create jobs in area communities since opening its doors over 130 years ago. Union Bank has earned an exceptional reputation for residential lending programs and has been recognized by the US Department of Agriculture, Rural Development for the positive impact made in the lives of first time home buyers. Union Bank is consistently one of the top Vermont Housing Finance Agency mortgage originators. Additionally, Union Bank has also been designated as an SBA Preferred lender for its participation in small business lending. Union Bank has received an "Outstanding" rating for its compliance with the Community Reinvestment Act (CRA). An institution in this group has an excellent record of helping to meet the credit needs of its assessment area, particularly in low-and moderate income neighborhoods, in a manner consistent with its resources and capabilities. | ||||||||||||||||||||||||||
Consolidated Balance Sheets (unaudited, in thousands) | Consolidated Statements of Income (unaudited, in thousands) | Union Bankshares, Inc. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DIRECTORS | OFFICERS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Neil J. Van Dyke - Chair | Neil J. Van Dyke - Chair | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ASSETS | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2022 | Dec 31, 2021 | Timothy W. Sargent - Vice Chair | David S. Silverman - President & CEO | |||||||||||||||||||||||||||||||||||||||||||||||||||
Joel S. Bourassa | Karyn J. Hale - Chief Financial Officer | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(3 months ended) | (12 months ended) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dawn D. Bugbee | Timothy W. Sargent - Secretary | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash and Due from Banks | $ | 4,504 | $ | 4,659 | Interest Income | $ | 12,355 | $ | 10,023 | $ | 43,948 | $ | 39,273 | ||||||||||||||||||||||||||||||||||||||||||||||
Nancy C. Putnam | Kristy Adams Alfieri - Assistant Secretary | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gregory D. Sargent | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Federal Funds Sold & Overnight Deposits | 33,381 | 61,263 | Interest Expense | 2,005 | 779 | 4,524 | 3,565 | David S. Silverman | |||||||||||||||||||||||||||||||||||||||||||||||||||
Net Interest Income | 10,350 | 9,244 | 39,424 | 35,708 | Janet P. Spitler | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Bearing Deposits in Banks | 16,428 | 13,196 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Credit for Loan Losses | — | (225) | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment Securities | 251,531 | 268,951 | Net Interest Income After Credit for Loan Losses | 10,350 | 9,469 | 39,424 | 35,708 | Union Bank | REGIONAL ADVISORY BOARD MEMBERS | ||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Held for Sale | 1,178 | 13,829 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Trust Income | 209 | 209 | 838 | 808 | DIRECTORS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans, net | 959,493 | 787,755 | Noninterest Income | 2,091 | 2,793 | 8,149 | 12,155 | Neil J. Van Dyke - Chair | Michael R. Barrett - St. Johnsbury | ||||||||||||||||||||||||||||||||||||||||||||||||||
Timothy W. Sargent - Vice Chair | Steven J. Bourgeois - St. Albans | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserve for Loan Losses | (8,339) | (8,336) | Noninterest Expenses: | Joel S. Bourassa | Andrew A. Dean - Northern NH | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Salaries & Wages | 3,578 | 3,894 | 14,083 | 14,448 | Dawn D. Bugbee | Stanley T. Fillion - Northern NH | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Premises and Equipment, net | 20,479 | 21,615 | Mary K. Parent | Rosemary H. Gingue - St. Johnsbury | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefits | 1,269 | 1,029 | 5,023 | 4,593 | Nancy C. Putnam | John M. Goodrich - St. Johnsbury | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Interest & other Assets | 57,740 | 42,441 | Gregory D. Sargent | Christopher M. Knapp - Northern NH | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
David S. Silverman | Coleen K. Kohaut - St. Albans | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Assets | $ | 1,336,395 | $ | 1,205,373 | Occupancy Expense, net | 476 | 461 | 1,913 | 1,890 | Janet P. Spitler | Justin P. Lavely - St. Johnsbury | ||||||||||||||||||||||||||||||||||||||||||||||||
Daniel J. Luneau - St. Albans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equipment Expense | 894 | 905 | 3,692 | 3,447 | Samuel H. Ruggiano - St. Albans | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Christine A. Sheley - Northern NH | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
David S. Silverman - All | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LIABILITIES & SHAREHOLDERS' EQUITY | Dec 31, 2022 | Dec 31, 2021 | Other Expenses | 2,172 | 2,176 | 8,453 | 8,477 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Union Bank Offices (ATMs at all Branch Locations) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | 8,389 | 8,465 | 33,164 | 32,855 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noninterest Bearing Deposits | $ | 286,145 | $ | 264,888 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Before Taxes | 4,261 | 4,006 | 15,247 | 15,816 | VERMONT | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Bearing Deposits | 762,722 | 723,479 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Berlin | 1028 US Route 302 | 802.476.0061 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Time Deposits | 153,045 | 106,715 | Income Tax Expense | 817 | 628 | 2,632 | 2,646 | Fairfax | Jct. Routes 104 & 128 | 802.849.2600 | |||||||||||||||||||||||||||||||||||||||||||||||||
Hardwick | 103 VT Route 15 West | 802.472.8100 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Borrowed Funds | 50,000 | — | Net income | $ | 3,444 | $ | 3,378 | $ | 12,615 | $ | 13,170 | Jeffersonville | 5062 VT Route 15 | 802.644.6600 | |||||||||||||||||||||||||||||||||||||||||||||
Jericho | 368 VT Route 15 | 802.899.7500 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subordinated Notes | 16,205 | 16,171 | Earnings per share | $ | 0.77 | $ | 0.76 | $ | 2.81 | $ | 2.94 | Johnson | 198 Lower Main Street | 802.635.6600 | |||||||||||||||||||||||||||||||||||||||||||||
Lyndonville | 183 Depot Street | 802.626.3100 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Interest & Other Liabilities | 13,058 | 9,779 | Book Value Per Share | $ | 12.25 | $ | 18.77 | Morrisville | 20 Lower Main Street | 802.888.6600 | |||||||||||||||||||||||||||||||||||||||||||||||||
65 Northgate Plaza | 802.888.6860 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | 9,965 | 9,934 | Shelburne | 5068 Shelburne Road | 802.985.0250 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
St. Albans | 15 Mapleville Depot | 802.524.9000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | 2,225 | 1,769 | St. Johnsbury | Operations and Loan Center | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retained Earnings | 364 Railroad Street | 802.748.3131 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
84,669 | 78,350 | Branch | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive (loss) Income | (37,419) | (1,552) | 325 Portland Street | 802.748.3121 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stowe | 47 Park Street | 802.253.6600 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Williston | Branch | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Treasury Stock at Cost | (4,220) | (4,160) | 31 Market St | 802.878.7900 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan Center | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Liabilities & Shareholders' Equity | $ | 1,336,395 | $ | 1,205,373 | 31 Market St | 802.865.1000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Standby letters of credit were $1,762,000 and $2,158,000 at December 31, 2022 and 2021, respectively. | NEW HAMPSHIRE | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Groveton | 3 State Street | 603.636.1611 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Littleton | 263 Dells Road | 603.444.7136 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
76 Main Street | 603.444.5321 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lincoln | 135 Main Street | 603.745.4000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
North Conway | Commercial Loan Center | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2541 White Mountain Hwy | 603.662.9408 |