UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
July 18, 2022
(Date of Report: Date of earliest event reported)
Middlefield Banc Corp.
(Exact name of registrant as specified in its charter)
Ohio
(State or other jurisdiction of incorporation)
001-36613
(Commission File Number)
34-1585111
(I.R.S. Employer Identification Number)
15985 East High Street
Middlefield, Ohio 44062
(Address of principal executive offices, including zip code)
(440) 632-1666
(Registrant’s telephone number, including area code)
(not applicable)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☒ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Common Stock, no par value | MBCN | The NASDAQ Stock Market, LLC (NASDAQ Capital Market) |
| ITEM 2.02 | RESULTS OF OPERATIONS AND FINANCIAL CONDITION |
The following information is furnished under Item 2.02. On July 18, 2022, Middlefield Banc Corp. issued a press release announcing financial results for the three month and six month period ended June 30, 2022. A copy of the press release is attached hereto as Exhibit 99 and is incorporated herein by this reference.
The information contained or incorporated by reference in this current report on Form 8-K may contain forward-looking statements, including certain plans, expectations, goals, and projections, which are subject to numerous assumptions, risks, and uncertainties. Actual results could differ materially from those contained or implied by such statements for a variety of factors, including: changes in economic conditions; movements in interest rates; competitive pressures on product pricing and services; success and timing of business strategies; the nature, extent, and timing of governmental actions and reforms; and extended disruption of vital infrastructure. All forward-looking statements included in this current report on Form 8-K are based on information available at the time of the report. Middlefield Banc Corp. assumes no obligation to update any forward-looking statement.
| ITEM 9.01 | FINANCIAL STATEMENTS AND EXHIBITS |
| (c) | Exhibits. |
The following exhibits are furnished herewith:
EXHIBITS
| 99 | July 18, 2022 press release of Middlefield Banc Corp. | |
| 104 | Cover Page Interactive File (embedded within the Inline XBRL document) | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| MIDDLEFIELD BANC CORP. | ||||||
| Date: July 18, 2022 | /s/ James R. Heslop, II | |||||
| President and CEO | ||||||
Exhibit 99
15985 East High Street
P. O. Box 35
Middlefield, Ohio 44062
Phone: 440/632-1666 FAX: 440/632-1700
www.middlefieldbank.bank
PRESS RELEASE |
| Company Contact: | Investor and Media Contact: | |
James Heslop President/Chief Executive Officer Middlefield Banc Corp. (440) 632-1666 Ext. 3219 JHeslop@middlefieldbank.com | Andrew M. Berger Managing Director SM Berger & Company, Inc. (216) 464-6400 andrew@smberger.com |
Middlefield Banc Corp. Reports 2022 First Half Financial Results
MIDDLEFIELD, OHIO, July 18, 2022◆◆◆◆ Middlefield Banc Corp. (NASDAQ: MBCN) reported financial results for the 2022 first half and second quarter ended June 30, 2022.
2022 First Half Financial Highlights Include (on a year-over-year basis unless noted):
| • | Returned $4.4 million of capital to shareholders through dividends and the repurchase of 95,364 shares at an average price of $25.39 per share |
| • | Net income was $7.9 million, or $1.35 per diluted share, compared to $8.6 million, or $1.35 per diluted share |
| • | First-half pre-tax income benefited from $1.2 million of accelerated net fees associated with the Paycheck Protection Program (“PPP”), compared to $1.9 million in the 2021 first half |
| • | Net income during the second quarter was negatively impacted by $579,000 of one-time expenses associated with the proposed Liberty Bancshares, Inc. merger |
| • | Net interest margin improved by 20 basis points to 3.91%, compared to 3.71% |
| • | Total loans were $978.0 million, compared to $981.7 million at December 31, 2021 |
| • | Total loans increased by $27.8 million, or 6.1% annualized from December 31, 2021, without the impact of PPP loan forgiveness |
| • | Return on average assets was 1.21%, compared to 1.26% |
| • | Return on average equity was 11.49%, compared to 11.88% |
| • | Return on average tangible common equity(1) was 13.03%, compared to 13.41% |
| • | Strong asset quality with nonperforming loans to total loans of 0.48%, compared to 0.73% |
| • | Allowance for loan losses was 1.49% of total loans, compared to 1.34% |
| • | Merger with Liberty Bancshares, Inc. on schedule to close during the 2022 fourth quarter |
“We are focused on profitably growing our business, supporting our communities, and creating value for our shareholders, and I am pleased with the progress we made during the second quarter,” stated James R. Heslop, II, President and Chief Executive Officer. “Profitability has remained strong despite lower year-over-year fees associated with the Paycheck Protection Program and $579,000 of one-time expenses associated with the proposed Liberty Bancshares, Inc. merger. Reflecting our profitable financial model, second-quarter net interest margin increased 30 basis points to 4.02%. I am also encouraged by the growth we experienced in our return on tangible common equity, demonstrating the additional benefits of our share repurchase program.”
Mr. Heslop continued, “We are working on growing our balance sheet while controlling risk in a very fluid business environment. During the second quarter, core loans increased at an annualized rate of 6.9% since the beginning of the year. We continue to work on completing the merger with Liberty Bancshares, Inc., which we expect to close during the 2022 fourth quarter. Once complete, we expect to benefit as a larger bank with total assets of approximately $1.80 billion, strong earnings accretion, and a robust footprint in two of Ohio’s largest and fastest-growing markets. We believe the merger will generate meaningful earnings per share accretion while having a minimal tangible book value dilution and manageable earn-back period.”
Mr. Heslop concluded, “Over the past several years, we have invested throughout our organization, expanded our digital banking capabilities, and assembled a strong team of motivated and experienced leaders. We expect 2022 to be another good year for Middlefield Banc Corp., and I am excited by the direction we are headed,” concluded Mr. Heslop.
Income Statement
Net interest income for the 2022 first half decreased 0.9% to $23.5 million, compared to $23.7 million for the same period last year. Year-to-date, the net interest margin was 3.91%, compared to 3.71% for the same period last year. Net interest income for the 2022 second quarter was $12.0 million, compared to $11.9 million for the 2021 second quarter. The 1.5% increase in net interest income for the 2022 second quarter was largely a result of a 26.9% reduction in total interest expense. The net interest margin for the 2022 second quarter was 4.02%, compared to 3.72% for the same period of 2021.
For the 2022 first half, noninterest income was $2.8 million, compared to $3.9 million for the same period last year. Noninterest income for the 2022 second quarter was $1.4 million, compared to $1.6 million for the same period last year.
For the 2022 first half, noninterest expense increased 3.6% to $16.8 million, compared to $16.2 million for the same period last year. Operating costs in the 2022 second quarter increased 8.1% to $8.5 million from $7.9 million for the 2021 second quarter. The Company incurred $579,000 of additional operating expenses during the 2022 second quarter associated with the proposed Liberty Bancshares, Inc. merger.
Net income for the 2022 first half ended June 30, 2022, was $7.9 million, or $1.35 per diluted share, compared to $8.6 million, or $1.35 per diluted share for the same period last year. Net income for the 2022 second quarter ended June 30, 2022, was $4.1 million, or $0.70 per diluted share, compared to $4.4 million, or $0.70 per diluted share for the same period last year.
Balance Sheet
Total assets at June 30, 2022, decreased 4.9% to $1.29 billion, compared to $1.36 billion at June 30, 2021. Net loans at June 30, 2022, decreased 7.5% to $963.4 million, compared to $1.04 billion at June 30, 2021. Since 2020, Middlefield has helped customers receive $211.1 million of forgiveness payments under the terms of the Paycheck Protection Program, including processing $16.3 million of forgiveness payments during the second quarter of 2022, and $32.7 million of forgiveness payments year-to-date. The balance of PPP loans outstanding at June 30, 2022, was $1.4 million.
Total deposits at June 30, 2022, were $1.15 billion, compared to $1.20 billion at June 30, 2021. The 4.0% decrease in deposits was primarily due to a decline in time-based and interest-bearing accounts, partially offset by increased noninterest-bearing accounts. The investment portfolio was $172.0 million at June 30, 2022, compared with $150.9 million at June 30, 2021.
Donald L. Stacy, Chief Financial Officer, stated, “We remain well-positioned to benefit from a rising interest rate environment. In addition, as economic uncertainty has increased, we are entering this period from a position of strength with a historically strong balance sheet and excellent asset quality. These trends allow us to navigate a changing economic cycle while simultaneously allocating capital to support our long-term growth strategies, dividend payment, and share repurchase program.”
Mr. Stacy continued, “We continue to allocate excess capital to our dividend and share repurchase programs. Year-to-date, we have repurchased 95,364 shares of our common stock at a total cost of $2.4 million. This includes 63,214 shares repurchased during the 2022 second quarter at an average price of $25.35 per share at June 30, 2022. With 292,187 shares remaining under our repurchase program, we will continue to focus on returning capital to shareholders through our share repurchase program.”
Stockholders’ Equity and Dividends
At June 30, 2022, stockholders’ equity was $128.2 million compared to $146.0 million at June 30, 2021. The 12.2% year-over-year decline in stockholders’ equity was primarily due to an increase in the unrealized loss on the available-for-sale investment portfolio during the three-month period and the Company’s stock repurchase program. On a per-share basis, shareholders’ equity at June 30, 2022, was $22.07 compared to $23.50 at June 30, 2021.
At June 30, 2022, tangible stockholders’ equity(1) was $111.9 million, compared to $129.4 million at June 30, 2021. On a per-share basis, tangible stockholders’ equity(1) was $19.26 at June 30, 2022, compared to $20.82 at June 30, 2021.
Through the 2022 first half, the Company declared cash dividends of $0.34 per share, compared to $0.32 per share for the same period last year.
At June 30, 2022, the Company had an equity-to-assets ratio of 9.91%, compared to 10.74% at June 30, 2021.
Asset Quality
There was no provision for loan losses for the 2022 second quarter versus a $200,000 provision for loan losses for the same period last year. The year-over-year decline in the provision for loan losses was partially due to strong asset quality and the previous year’s prudent build in the Company’s allowance for loan losses associated with the potential economic impacts caused by the COVID-19 pandemic. There was no provision for loan losses for the 2022 first half versus $900,000 for the same period last year.
Net recoveries were $58,000, or 0.02% of average loans, annualized, during the 2022 second quarter, compared to net charge-offs of $122,000, or 0.05% of average loans, annualized, at June 30, 2021. Year-to-date net recoveries were $208,000, or 0.04% of average loans, annualized, compared to net charge-offs of $159,000, or 0.03% of average loans, annualized for the six-months ended June 30, 2021.
Nonperforming loans at June 30, 2022, were $4.7 million, compared to $7.8 million at June 30, 2021. Nonperforming assets at June 30, 2022, were $11.5 million, compared to $14.9 million at June 30, 2021. The allowance for loan losses at June 30, 2022, stood at $14.6 million, or 1.49% of total loans, compared to $14.2 million, or 1.34% of total loans at June 30, 2021.
ABOUT MIDDLEFIELD BANC CORP.
Middlefield Banc Corp., headquartered in Middlefield, Ohio, is the bank holding company of The Middlefield Banking Company, with total assets of $1.29 billion at June 30, 2022. The Bank operates 16 full-service banking centers and an LPL Financial® brokerage office serving Beachwood, Chardon, Cortland, Dublin, Garrettsville, Mantua, Middlefield, Newbury, Orwell, Plain City, Powell, Solon, Sunbury, Twinsburg, and Westerville. The Bank also operates a Loan Production Office in Mentor, Ohio.
Additional information is available at www.middlefieldbank.bank
| (1) | This press release includes disclosure of Middlefield Banc Corp.’s tangible book value per share, return on average tangible equity, and pre-tax, pre-provision for loan losses income, which are financial measures not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed by GAAP. Middlefield Banc Corp. believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and Middlefield Banc Corp.’s marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP. The reconciliations of non-GAAP financial measures are included in the tables following Consolidated Financial Highlights below. |
FORWARD-LOOKING STATEMENTS
This press release of Middlefield Banc Corp. and the reports Middlefield Banc Corp. files with the Securities and Exchange Commission often contain “forward-looking statements” relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets, and products of Middlefield Banc Corp. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Middlefield Banc Corp.’s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce interest margins; (3) changes in prepayment speeds, charge-offs and loan loss provisions; (4) less favorable than expected general economic conditions; (5) legislative or regulatory changes that may adversely affect businesses in which Middlefield Banc Corp. is engaged; (6) technological issues which may adversely affect Middlefield Banc Corp.’s financial operations or customers; (7) the effect of the COVID-19 pandemic, including on our credit quality and business operations, as well as its impact on general economic and financial market conditions; (8) changes in the securities markets; (9) the Company’s failure to integrate Liberty Bancshares, Inc. and Liberty National Bank with Middlefield in accordance with expectations and deviations from performance expectations related to Liberty Bancshares, Inc. and Liberty National Bank; or (10) risk factors mentioned in the reports and registration statements Middlefield Banc Corp. files with the Securities and Exchange Commission. Middlefield Banc Corp. undertakes no obligation to release revisions to these forward-looking statements or to reflect events or circumstances after the date of this press release.
IMPORTANT ADDITIONAL INFORMATION
In connection with the proposed merger with Liberty Bancshares, Inc., (“Liberty”), the Company intends to file with the SEC a registration statement on Form S-4 to register the shares of the Company’s common stock that will be issued to Liberty shareholders in connection with the merger. The registration statement will include a joint proxy statement/prospectus and other relevant materials in connection with the proposed merger, which will be sent to the shareholders of Liberty and the Company seeking their approval of the proposed merger.
SHAREHOLDERS OF LIBERTY, COMPANY SHAREHOLDERS, AND OTHER INVESTORS ARE URGED TO CAREFULLY READ THE PROXY STATEMENT AND PROSPECTUS TO BE INCLUDED IN THE REGISTRATION STATEMENT ON FORM S-4, BECAUSE THE PROXY STATEMENT/PROSPECTUSES WILL CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY, LIBERTY, THE PROPOSED MERGER, THE PERSONS SOLICITING PROXIES WITH RESPECT TO THE PROPOSED MERGER, AND THEIR INTERESTS IN THE PROPOSED MERGER AND RELATED MATTERS.
Investors and security holders will be able to obtain free copies of the Registration Statement on Form S-4 (when available) and other documents filed by the Company with the SEC through the website maintained by the SEC at www.sec.gov. Copies of the documents filed with the SEC by the Company will be available free of charge on the Company’s website at www.middlefieldbank.bank or may be obtained from the Company by written request to Middlefield Banc Corp., 15985 East High Street P. O. Box 35 Middlefield, Ohio 44062, Attention: Investor Relations.
This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of securities in any jurisdiction in which the offer, solicitation or sale is unlawful before registration or qualification of the securities under the securities laws of the jurisdiction. No offer of securities shall be made except by means of a prospectus satisfying the requirements of Section 10 of the Securities Act.
The respective directors and executive officers of the Company and Liberty and other persons may be deemed to be participants in the solicitation of proxies from Liberty shareholders with respect to the proposed merger. Information regarding the directors of the Company is available in its proxy statement filed with the SEC on April 5, 2022 in connection with its 2022 Annual Meeting of Shareholders and information regarding the executive officers of the Company is available in its Form 10-K filed with the SEC on March 15, 2022. Information regarding the directors and executive officers of Liberty, which is a private company, and other information regarding the participants in the solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus to be included in the Form S-4 Registration Statement and other relevant materials to be filed with the SEC when they become available.
MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(Dollar amounts in thousands, unaudited)
| June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
Balance Sheets (period end) | 2022 | 2022 | 2021 | 2021 | 2021 | |||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and due from banks | $ | 60,114 | $ | 78,804 | $ | 97,172 | $ | 113,177 | $ | 82,435 | ||||||||||
Federal funds sold | 19,039 | 29,474 | 22,322 | 19,174 | 10,034 | |||||||||||||||
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Cash and cash equivalents | 79,153 | 108,278 | 119,494 | 132,351 | 92,469 | |||||||||||||||
Equity securities, at fair value | 779 | 851 | 818 | 833 | 730 | |||||||||||||||
Investment securities available for sale, at fair value | 171,958 | 175,216 | 170,199 | 163,057 | 150,850 | |||||||||||||||
Loans held for sale | — | 9 | 1,051 | 676 | 790 | |||||||||||||||
Loans: | ||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||
Owner occupied | 120,771 | 113,590 | 111,470 | 110,883 | 109,777 | |||||||||||||||
Non-owner occupied | 288,334 | 293,745 | 283,618 | 310,222 | 304,324 | |||||||||||||||
Multifamily | 29,152 | 29,385 | 31,189 | 30,762 | 34,926 | |||||||||||||||
Residential real estate | 246,453 | 244,747 | 240,089 | 232,020 | 228,102 | |||||||||||||||
Commercial and industrial | 137,398 | 131,683 | 148,812 | 163,052 | 200,558 | |||||||||||||||
Home equity lines of credit | 111,730 | 106,300 | 104,355 | 105,450 | 107,685 | |||||||||||||||
Construction and other | 35,988 | 50,152 | 54,148 | 49,378 | 62,229 | |||||||||||||||
Consumer installment | 8,171 | 8,118 | 8,010 | 8,515 | 8,694 | |||||||||||||||
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Total loans | 977,997 | 977,720 | 981,691 | 1,010,282 | 1,056,295 | |||||||||||||||
Less allowance for loan and lease losses | 14,550 | 14,492 | 14,342 | 14,234 | 14,200 | |||||||||||||||
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Net loans | 963,447 | 963,228 | 967,349 | 996,048 | 1,042,095 | |||||||||||||||
Premises and equipment, net | 17,030 | 17,142 | 17,272 | 17,507 | 17,680 | |||||||||||||||
Goodwill | 15,071 | 15,071 | 15,071 | 15,071 | 15,071 | |||||||||||||||
Core deposit intangibles | 1,249 | 1,326 | 1,403 | 1,484 | 1,564 | |||||||||||||||
Bank-owned life insurance | 17,274 | 17,166 | 17,060 | 16,954 | 16,846 | |||||||||||||||
Other real estate owned | 6,792 | 6,992 | 6,992 | 7,090 | 7,090 | |||||||||||||||
Accrued interest receivable and other assets | 20,624 | 18,019 | 14,297 | 14,794 | 15,033 | |||||||||||||||
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TOTAL ASSETS | $ | 1,293,377 | $ | 1,323,298 | $ | 1,331,006 | $ | 1,365,865 | $ | 1,360,218 | ||||||||||
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| June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
| 2022 | 2022 | 2021 | 2021 | 2021 | ||||||||||||||||
LIABILITIES | ||||||||||||||||||||
Deposits: | ||||||||||||||||||||
Noninterest-bearing demand | $ | 379,872 | $ | 361,251 | $ | 334,171 | $ | 316,770 | $ | 326,665 | ||||||||||
Interest-bearing demand | 154,788 | 162,010 | 196,308 | 237,576 | 207,725 | |||||||||||||||
Money market | 185,494 | 187,807 | 177,281 | 178,423 | 183,453 | |||||||||||||||
Savings | 252,179 | 264,784 | 260,125 | 256,114 | 252,171 | |||||||||||||||
Time | 174,833 | 191,320 | 198,725 | 211,674 | 225,271 | |||||||||||||||
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Total deposits | 1,147,166 | 1,167,172 | 1,166,610 | 1,200,557 | 1,195,285 | |||||||||||||||
Other borrowings | 12,910 | 12,975 | 12,901 | 12,966 | 13,031 | |||||||||||||||
Accrued interest payable and other liabilities | 5,081 | 5,507 | 6,160 | 6,287 | 5,858 | |||||||||||||||
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TOTAL LIABILITIES | 1,165,157 | 1,185,654 | 1,185,671 | 1,219,810 | 1,214,174 | |||||||||||||||
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STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
Common stock, no par value; 10,000,000 shares authorized, 7,347,526 shares issued, 5,810,351 shares outstanding as of June 30, 2022 | 87,562 | 87,562 | 87,131 | 87,131 | 87,131 | |||||||||||||||
Retained earnings | 89,900 | 86,804 | 83,971 | 80,376 | 76,150 | |||||||||||||||
Accumulated other comprehensive (loss) income | (17,591 | ) | (6,674 | ) | 3,462 | 3,610 | 3,893 | |||||||||||||
Treasury stock, at cost; 1,537,175 shares as of June 30, 2022 | (31,651 | ) | (30,048 | ) | (29,229 | ) | (25,062 | ) | (21,130 | ) | ||||||||||
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TOTAL STOCKHOLDERS’ EQUITY | 128,220 | 137,644 | 145,335 | 146,055 | 146,044 | |||||||||||||||
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,293,377 | $ | 1,323,298 | $ | 1,331,006 | $ | 1,365,865 | $ | 1,360,218 | ||||||||||
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MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(Dollar amounts in thousands, unaudited)
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||||||||||||||
| June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
Statements of Income | 2022 | 2022 | 2021 | 2021 | 2021 | 2022 | 2021 | |||||||||||||||||||||
INTEREST AND DIVIDEND INCOME | ||||||||||||||||||||||||||||
Interest and fees on loans | $ | 11,268 | $ | 10,985 | $ | 11,586 | $ | 12,258 | $ | 11,885 | $ | 22,253 | $ | 24,052 | ||||||||||||||
Interest-earning deposits in other institutions | 74 | 24 | 30 | 30 | 12 | 98 | 30 | |||||||||||||||||||||
Federal funds sold | 46 | 3 | 1 | 1 | 1 | 49 | 1 | |||||||||||||||||||||
Investment securities: | ||||||||||||||||||||||||||||
Taxable interest | 442 | 443 | 438 | 461 | 410 | 885 | 780 | |||||||||||||||||||||
Tax-exempt interest | 955 | 784 | 732 | 673 | 602 | 1,739 | 1,160 | |||||||||||||||||||||
Dividends on stock | 33 | 24 | 23 | 24 | 26 | 57 | 55 | |||||||||||||||||||||
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Total interest and dividend income | 12,818 | 12,263 | 12,810 | 13,447 | 12,936 | 25,081 | 26,078 | |||||||||||||||||||||
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INTEREST EXPENSE | ||||||||||||||||||||||||||||
Deposits | 709 | 726 | 783 | 915 | 1,010 | 1,435 | 2,215 | |||||||||||||||||||||
Other borrowings | 81 | 69 | 67 | 69 | 71 | 150 | 146 | |||||||||||||||||||||
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Total interest expense | 790 | 795 | 850 | 984 | 1,081 | 1,585 | 2,361 | |||||||||||||||||||||
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NET INTEREST INCOME | 12,028 | 11,468 | 11,960 | 12,463 | 11,855 | 23,496 | 23,717 | |||||||||||||||||||||
Provision for loan losses | — | — | (200 | ) | — | 200 | — | 900 | ||||||||||||||||||||
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NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 12,028 | 11,468 | 12,160 | 12,463 | 11,655 | 23,496 | 22,817 | |||||||||||||||||||||
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| |||||||||||||||
NONINTEREST INCOME | ||||||||||||||||||||||||||||
Service charges on deposit accounts | 956 | 914 | 906 | 876 | 856 | 1,870 | 1,643 | |||||||||||||||||||||
(Loss) gain on equity securities | (72 | ) | 33 | (14 | ) | 102 | 40 | (39 | ) | 121 | ||||||||||||||||||
Earnings on bank-owned life insurance | 108 | 106 | 106 | 108 | 106 | 214 | 332 | |||||||||||||||||||||
Gains on sale of loans | 18 | 3 | 118 | 309 | 221 | 21 | 813 | |||||||||||||||||||||
Revenue from investment services | 153 | 141 | 198 | 192 | 210 | 294 | 339 | |||||||||||||||||||||
Other income | 220 | 206 | 221 | 234 | 199 | 426 | 602 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total noninterest income | 1,383 | 1,403 | 1,535 | 1,821 | 1,632 | 2,786 | 3,850 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
NONINTEREST EXPENSE | ||||||||||||||||||||||||||||
Salaries and employee benefits | 3,785 | 4,386 | 4,088 | 4,488 | 4,321 | 8,171 | 8,575 | |||||||||||||||||||||
Occupancy expense | 583 | 505 | 542 | 425 | 517 | 1,088 | 1,081 | |||||||||||||||||||||
Equipment expense | 274 | 315 | 358 | 333 | 313 | 589 | 670 | |||||||||||||||||||||
Data processing and information technology costs | 822 | 682 | 660 | 736 | 698 | 1,665 | 1,484 | |||||||||||||||||||||
Ohio state franchise tax | 292 | 293 | 285 | 287 | 286 | 585 | 572 | |||||||||||||||||||||
Federal deposit insurance expense | 90 | 50 | 50 | 150 | 150 | 140 | 294 | |||||||||||||||||||||
Professional fees | 383 | 455 | 435 | 136 | 323 | 838 | 742 | |||||||||||||||||||||
Net loss (gain) on other real estate owned | 206 | 8 | (66 | ) | 9 | 22 | 214 | 68 | ||||||||||||||||||||
Advertising expense | 229 | 228 | 221 | 222 | 221 | 457 | 442 | |||||||||||||||||||||
Software amortization expense | 40 | 48 | 119 | 88 | 74 | 88 | 154 | |||||||||||||||||||||
Core deposit intangible amortization | 77 | 77 | 80 | 81 | 80 | 154 | 160 | |||||||||||||||||||||
Merger-related costs | 579 | — | — | — | — | 579 | — | |||||||||||||||||||||
Other expense | 1,175 | 1,219 | 1,059 | 951 | 889 | 2,233 | 1,969 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total noninterest expense | 8,535 | 8,266 | 7,831 | 7,906 | 7,894 | 16,801 | 16,211 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Income before income taxes | 4,876 | 4,605 | 5,864 | 6,378 | 5,393 | 9,481 | 10,456 | |||||||||||||||||||||
Income taxes | 787 | 772 | 1,027 | 1,174 | 968 | 1,559 | 1,864 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
NET INCOME | $ | 4,089 | $ | 3,833 | $ | 4,837 | $ | 5,204 | $ | 4,425 | $ | 7,922 | $ | 8,592 | ||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
PTPP (1) | $ | 4,876 | $ | 4,605 | $ | 5,664 | $ | 6,378 | $ | 5,593 | $ | 9,481 | $ | 11,356 | ||||||||||||||
|
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|
|
|
|
|
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|
|
|
|
|
| |||||||||||||||
| (1) | The pre-tax pre-provision (PTPP) is the income before income taxes before provision for loan losses considerations, for reconciliation of non-GAAP measures. |
MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(Dollar amounts in thousands, except per share and share amounts, unaudited)
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||||||||||||||
| June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
| 2022 | 2022 | 2021 | 2021 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Per common share data | ||||||||||||||||||||||||||||
Net income per common share - basic | $ | 0.70 | $ | 0.65 | $ | 0.81 | $ | 0.85 | $ | 0.70 | $ | 1.35 | $ | 1.36 | ||||||||||||||
Net income per common share - diluted | $ | 0.70 | $ | 0.65 | $ | 0.81 | $ | 0.85 | $ | 0.70 | $ | 1.35 | $ | 1.35 | ||||||||||||||
Dividends declared per share | $ | 0.17 | $ | 0.17 | $ | 0.21 | $ | 0.16 | $ | 0.16 | $ | 0.34 | $ | 0.32 | ||||||||||||||
Book value per share (period end) | $ | 22.07 | $ | 23.43 | $ | 24.68 | $ | 24.13 | $ | 23.50 | $ | 22.07 | $ | 23.50 | ||||||||||||||
Tangible book value per share (period end) (2) (3) | $ | 19.26 | $ | 20.64 | $ | 21.88 | $ | 21.39 | $ | 20.82 | $ | 19.26 | $ | 20.82 | ||||||||||||||
Dividends declared | $ | 993 | $ | 1,000 | $ | 1,242 | $ | 978 | $ | 1,004 | $ | 1,993 | $ | 1,920 | ||||||||||||||
Dividend yield | 2.71 | % | 2.78 | % | 3.37 | % | 2.66 | % | 2.72 | % | 2.72 | % | 2.73 | % | ||||||||||||||
Dividend payout ratio | 24.28 | % | 26.09 | % | 25.68 | % | 18.79 | % | 22.69 | % | 25.16 | % | 22.35 | % | ||||||||||||||
Average shares outstanding - basic | 5,851,422 | 5,879,025 | 5,951,838 | 6,136,648 | 6,297,071 | 5,865,147 | 6,331,356 | |||||||||||||||||||||
Average shares outstanding - diluted | 5,860,098 | 5,889,836 | 5,975,333 | 6,157,181 | 6,312,230 | 5,873,823 | 6,348,345 | |||||||||||||||||||||
Period ending shares outstanding | 5,810,351 | 5,873,565 | 5,888,737 | 6,054,083 | 6,215,511 | 5,810,351 | 6,215,511 | |||||||||||||||||||||
Selected ratios | ||||||||||||||||||||||||||||
Return on average assets | 1.25 | % | 1.17 | % | 1.41 | % | 1.51 | % | 1.30 | % | 1.21 | % | 1.26 | % | ||||||||||||||
Return on average equity | 12.30 | % | 10.75 | % | 13.17 | % | 13.95 | % | 12.10 | % | 11.49 | % | 11.88 | % | ||||||||||||||
Return on average tangible common equity (2) (4) | 14.02 | % | 12.13 | % | 14.85 | % | 15.71 | % | 13.65 | % | 13.03 | % | 13.41 | % | ||||||||||||||
Efficiency (1) | 61.82 | % | 62.54 | % | 56.56 | % | 54.04 | % | 57.18 | % | 62.17 | % | 57.50 | % | ||||||||||||||
Equity to assets at period end | 9.91 | % | 10.40 | % | 10.92 | % | 10.69 | % | 10.74 | % | 9.91 | % | 10.74 | % | ||||||||||||||
Noninterest expense to average assets | 0.65 | % | 0.62 | % | 0.58 | % | 0.58 | % | 0.58 | % | 1.27 | % | 1.18 | % | ||||||||||||||
| (1) | The efficiency ratio is calculated by dividing noninterest expense less amortization of intangibles by the sum of net interest income on a fully taxable equivalent basis plus noninterest income |
| (2) | See reconciliation of non-GAAP measures below |
| (3) | Calculated by dividing tangible common equity by shares outstanding |
| (4) | Calculated by dividing annualized net income for each period by average tangible common equity |
MIDDLEFIELD BANC CORP.
Consolidated Selected Financial Highlights
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||||||||||||||
| June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | June 30, | ||||||||||||||||||||||
Yields | 2022 | 2022 | 2021 | 2021 | 2021 | 2022 | 2021 | |||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||||||
Loans receivable (2) | 4.66 | % | 4.53 | % | 4.61 | % | 4.74 | % | 4.43 | % | 4.60 | % | 4.45 | % | ||||||||||||||
Investment securities (2) | 3.76 | % | 3.41 | % | 3.30 | % | 3.37 | % | 3.47 | % | 3.59 | % | 3.60 | % | ||||||||||||||
Interest-earning deposits with other banks | 0.77 | % | 0.23 | % | 0.20 | % | 0.21 | % | 0.18 | % | 0.48 | % | 0.19 | % | ||||||||||||||
Total interest-earning assets | 4.28 | % | 4.06 | % | 4.07 | % | 4.20 | % | 4.05 | % | 4.17 | % | 4.08 | % | ||||||||||||||
Deposits: | ||||||||||||||||||||||||||||
Interest-bearing demand deposits | 0.15 | % | 0.14 | % | 0.12 | % | 0.12 | % | 0.12 | % | 0.15 | % | 0.14 | % | ||||||||||||||
Money market deposits | 0.49 | % | 0.47 | % | 0.47 | % | 0.46 | % | 0.46 | % | 0.48 | % | 0.47 | % | ||||||||||||||
Savings deposits | 0.06 | % | 0.06 | % | 0.06 | % | 0.06 | % | 0.06 | % | 0.06 | % | 0.07 | % | ||||||||||||||
Certificates of deposit | 0.83 | % | 0.87 | % | 0.90 | % | 1.08 | % | 1.19 | % | 0.85 | % | 1.24 | % | ||||||||||||||
Total interest-bearing deposits | 0.36 | % | 0.37 | % | 0.36 | % | 0.41 | % | 0.46 | % | 0.36 | % | 0.50 | % | ||||||||||||||
Non-Deposit Funding: | ||||||||||||||||||||||||||||
Borrowings | 2.51 | % | 2.16 | % | 2.09 | % | 2.11 | % | 2.18 | % | 2.34 | % | 2.16 | % | ||||||||||||||
Total interest-bearing liabilities | 0.39 | % | 0.39 | % | 0.37 | % | 0.42 | % | 0.47 | % | 0.39 | % | 0.50 | % | ||||||||||||||
Cost of deposits | 0.24 | % | 0.25 | % | 0.26 | % | 0.30 | % | 0.34 | % | 0.25 | % | 0.37 | % | ||||||||||||||
Cost of funds | 0.27 | % | 0.27 | % | 0.27 | % | 0.31 | % | 0.35 | % | 0.27 | % | 0.38 | % | ||||||||||||||
Net interest margin (1) | 4.02 | % | 3.80 | % | 3.82 | % | 3.91 | % | 3.72 | % | 3.91 | % | 3.71 | % | ||||||||||||||
| (1) | Net interest margin represents net interest income as a percentage of average interest-earning assets. |
| (2) | Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were determined using an effective tax rate of 21%. |
| For the Three Months Ended | ||||||||||||||||||||||||||||
Asset quality data | June 30, 2022 | March 31, 2022 | December 31, 2021 | September 30, 2021 | June 30, 2021 | |||||||||||||||||||||||
(Dollar amounts in thousands, unaudited) | ||||||||||||||||||||||||||||
Nonperforming loans (1) | $ | 4,670 | $ | 4,728 | $ | 4,859 | $ | 6,806 | $ | 7,760 | ||||||||||||||||||
Other real estate owned | 6,792 | 6,992 | 6,992 | 7,090 | 7,090 | |||||||||||||||||||||||
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| |||||||||||||||||||
Nonperforming assets | $ | 11,462 | $ | 11,720 | $ | 11,851 | $ | 13,896 | $ | 14,850 | ||||||||||||||||||
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| |||||||||||||||||||
Allowance for loan losses | $ | 14,550 | $ | 14,492 | $ | 14,342 | $ | 14,234 | $ | 14,200 | ||||||||||||||||||
Allowance for loan losses/total loans | 1.49 | % | 1.48 | % | 1.46 | % | 1.41 | % | 1.34 | % | ||||||||||||||||||
Net (recoveries) charge-offs: | ||||||||||||||||||||||||||||
Quarter-to-date | $ | (58 | ) | $ | (150 | ) | $ | (308 | ) | $ | (34 | ) | $ | 122 | ||||||||||||||
Year-to-date | (208 | ) | (150 | ) | (183 | ) | 125 | 159 | ||||||||||||||||||||
Net charge-offs to average loans, annualized: | ||||||||||||||||||||||||||||
Quarter-to-date | -0.02 | % | -0.06 | % | -0.12 | % | -0.01 | % | 0.05 | % | ||||||||||||||||||
Year-to-date | -0.04 | % | -0.06 | % | -0.02 | % | 0.02 | % | 0.03 | % | ||||||||||||||||||
Nonperforming loans/total loans | 0.48 | % | 0.48 | % | 0.49 | % | 0.67 | % | 0.73 | % | ||||||||||||||||||
Allowance for loan losses/nonperforming loans | 311.56 | % | 306.51 | % | 295.16 | % | 209.14 | % | 182.99 | % | ||||||||||||||||||
Nonperforming assets/total assets | 0.89 | % | 0.89 | % | 0.89 | % | 1.02 | % | 1.09 | % | ||||||||||||||||||
(1) Nonperforming loans exclude troubled debt restructurings that are performing in accordance with their terms over a prescribed period of time. |
| |||||||||||||||||||||||||||
Reconciliation of Common Stockholders’ Equity | For the Three Months Ended | |||||||||||||||||||||||||||
| (Dollar amounts in thousands, unaudited) | June 30, 2022 | March 31, 2022 | December 31, 2021 | September 30, 2021 | June 30, 2021 | |||||||||||||||||||||||
Stockholders’ Equity | $ | 128,220 | $ | 137,644 | $ | 145,335 | $ | 146,055 | $ | 146,044 | ||||||||||||||||||
Less Goodwill and other intangibles | 16,320 | 16,397 | 16,474 | 16,555 | 16,635 | |||||||||||||||||||||||
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|
|
|
|
|
|
|
|
| |||||||||||||||||||
Tangible Common Equity | $ | 111,900 | $ | 121,247 | $ | 128,861 | $ | 129,500 | $ | 129,409 | ||||||||||||||||||
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|
|
|
|
|
|
|
| |||||||||||||||||||
Shares outstanding | 5,810,351 | 5,873,565 | 5,888,737 | 6,054,083 | 6,215,511 | |||||||||||||||||||||||
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| |||||||||||||||||||
Tangible book value per share | $ | 19.26 | $ | 20.64 | $ | 21.88 | $ | 21.39 | $ | 20.82 | ||||||||||||||||||
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| |||||||||||||||||||
Reconciliation of Average Equity to Return on | For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||
| June 30, 2022 | March 31, 2022 | December 31, 2021 | September 30, 2021 | June 30, 2021 | June 30, 2022 | June 30, 2021 | ||||||||||||||||||||||
Average Stockholders’ Equity | $ | 133,377 | $ | 144,630 | $ | 145,716 | $ | 148,048 | $ | 146,719 | $ | 139,003 | $ | 145,892 | ||||||||||||||
Less Average Goodwill and other intangibles | 16,357 | 16,435 | 16,513 | 16,594 | 16,674 | 16,396 | 16,714 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Average Tangible Common Equity | $ | 117,020 | $ | 128,195 | $ | 129,203 | $ | 131,454 | $ | 130,045 | $ | 122,607 | $ | 129,178 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Net income | $ | 4,089 | $ | 3,833 | $ | 4,837 | $ | 5,204 | $ | 4,425 | $ | 7,922 | $ | 8,592 | ||||||||||||||
|
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|
|
|
|
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|
|
| |||||||||||||||
Return on average tangible common equity (annualized) | 14.02 | % | 12.13 | % | 14.85 | % | 15.71 | % | 13.65 | % | 13.03 | % | 13.41 | % | ||||||||||||||
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| |||||||||||||||
Reconciliation of Pre-Tax Pre-Provision Income | For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||
| June 30, 2022 | March 31, 2022 | December 31, 2021 | September 30, 2021 | June 30, 2021 | June 30, 2022 | June 30, 2021 | ||||||||||||||||||||||
Net income | $ | 4,089 | $ | 3,833 | $ | 4,837 | $ | 5,204 | $ | 4,425 | $ | 7,922 | $ | 8,592 | ||||||||||||||
Add Income Taxes | 787 | 772 | 1,027 | 1,174 | 968 | 1,559 | 1,864 | |||||||||||||||||||||
Add Provision for loan losses | — | — | (200 | ) | — | 200 | — | 900 | ||||||||||||||||||||
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| |||||||||||||||
PTPP | $ | 4,876 | $ | 4,605 | $ | 5,664 | $ | 6,378 | $ | 5,593 | $ | 9,481 | $ | 11,356 | ||||||||||||||
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MIDDLEFIELD BANC CORP.
Average Balance Sheets
(Dollar amounts in thousands, unaudited)
| For the Three Months Ended | ||||||||||||||||||||||||
| June 30, 2022 | June 30, 2021 | |||||||||||||||||||||||
| Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | |||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loans receivable (3) | $ | 970,820 | $ | 11,268 | 4.66 | % | $ | 1,078,866 | $ | 11,885 | 4.43 | % | ||||||||||||
Investment securities (3) | 176,138 | 1,397 | 3.76 | % | 135,338 | 1,012 | 3.47 | % | ||||||||||||||||
Interest-earning deposits with other banks (4) | 79,924 | 153 | 0.77 | % | 85,245 | 39 | 0.18 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total interest-earning assets | 1,226,882 | 12,818 | 4.28 | % | 1,299,449 | 12,936 | 4.05 | % | ||||||||||||||||
|
|
|
| |||||||||||||||||||||
Noninterest-earning assets | 89,555 | 70,692 | ||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||
Total assets | $ | 1,316,437 | $ | 1,370,141 | ||||||||||||||||||||
|
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|
| |||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 159,779 | $ | 59 | 0.15 | % | $ | 207,080 | $ | 64 | 0.12 | % | ||||||||||||
Money market deposits | 185,711 | 228 | 0.49 | % | 185,728 | 212 | 0.46 | % | ||||||||||||||||
Savings deposits | 260,226 | 40 | 0.06 | % | 253,612 | 38 | 0.06 | % | ||||||||||||||||
Certificates of deposit | 184,748 | 382 | 0.83 | % | 233,930 | 696 | 1.19 | % | ||||||||||||||||
Short-term borrowings | — | — | 0.00 | % | 227 | — | 0.00 | % | ||||||||||||||||
Other borrowings | 12,945 | 81 | 2.51 | % | 13,062 | 71 | 2.18 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total interest-bearing liabilities | 803,409 | 790 | 0.39 | % | 893,639 | 1,081 | 0.49 | % | ||||||||||||||||
|
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|
| |||||||||||||||||||||
Noninterest-bearing liabilities: | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 375,013 | 323,590 | ||||||||||||||||||||||
Other liabilities | 4,638 | 6,193 | ||||||||||||||||||||||
Stockholders’ equity | 133,377 | 146,719 | ||||||||||||||||||||||
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|
| |||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,316,437 | $ | 1,370,141 | ||||||||||||||||||||
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|
|
| |||||||||||||||||||||
Net interest income | $ | 12,028 | $ | 11,855 | ||||||||||||||||||||
|
|
|
| |||||||||||||||||||||
Interest rate spread (1) | 3.89 | % | 3.56 | % | ||||||||||||||||||||
Net interest margin (2) | 4.02 | % | 3.72 | % | ||||||||||||||||||||
Ratio of average interest-earning assets to | ||||||||||||||||||||||||
average interest-bearing liabilities | 152.71 | % | 145.41 | % | ||||||||||||||||||||
| (1) | Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. |
| (2) | Net interest margin represents net interest income as a percentage of average interest-earning assets. |
| (3) | Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $271 and $179 for the three months ended June 30, 2022 and 2021, respectively |
| (4) | Includes dividends received on restricted stock. |
| For the Three Months Ended | ||||||||||||||||||||||||
| June 30, | March 31, | |||||||||||||||||||||||
| 2022 | 2022 | |||||||||||||||||||||||
| Average | Average | Average | Average | |||||||||||||||||||||
| Balance | Interest | Yield/Cost | Balance | Interest | Yield/Cost | |||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loans receivable (3) | $ | 970,820 | $ | 11,268 | 4.66 | % | $ | 983,853 | $ | 10,985 | 4.53 | % | ||||||||||||
Investment securities (3) | 176,138 | 1,397 | 3.76 | % | 170,829 | 1,227 | 3.41 | % | ||||||||||||||||
Interest-earning deposits with other banks (4) | 79,924 | 153 | 0.77 | % | 91,690 | 51 | 0.23 | % | ||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
| |||||||||||||
Total interest-earning assets | 1,226,882 | 12,818 | 4.28 | % | 1,246,372 | 12,263 | 4.06 | % | ||||||||||||||||
|
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| |||||||||||||||||||
Noninterest-earning assets | 89,555 | 85,667 | ||||||||||||||||||||||
|
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| |||||||||||||||||||||
Total assets | $ | 1,316,437 | $ | 1,332,039 | ||||||||||||||||||||
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| |||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 159,779 | $ | 59 | 0.15 | % | $ | 170,353 | $ | 60 | 0.14 | % | ||||||||||||
Money market deposits | 185,711 | 228 | 0.49 | % | 184,265 | 212 | 0.47 | % | ||||||||||||||||
Savings deposits | 260,226 | 40 | 0.06 | % | 260,162 | 38 | 0.06 | % | ||||||||||||||||
Certificates of deposit | 184,748 | 382 | 0.83 | % | 193,657 | 416 | 0.87 | % | ||||||||||||||||
Short-term borrowings | — | — | 0.00 | % | — | — | 0.00 | % | ||||||||||||||||
Other borrowings | 12,945 | 81 | 2.51 | % | 12,943 | 69 | 2.16 | % | ||||||||||||||||
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Total interest-bearing liabilities | 803,409 | 790 | 0.39 | % | 821,380 | 795 | 0.39 | % | ||||||||||||||||
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Noninterest-bearing liabilities: | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 375,013 | 359,656 | ||||||||||||||||||||||
Other liabilities | 4,638 | 6,373 | ||||||||||||||||||||||
Stockholders’ equity | 133,377 | 144,630 | ||||||||||||||||||||||
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Total liabilities and stockholders’ equity | $ | 1,316,437 | $ | 1,332,039 | ||||||||||||||||||||
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Net interest income | $ | 12,028 | $ | 11,468 | ||||||||||||||||||||
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| |||||||||||||||||||||
Interest rate spread (1) | 3.89 | % | 3.67 | % | ||||||||||||||||||||
Net interest margin (2) | 4.02 | % | 3.80 | % | ||||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 152.71 | % | 151.74 | % | ||||||||||||||||||||
| (1) | Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. |
| (2) | Net interest margin represents net interest income as a percentage of average interest-earning assets. |
| (3) | Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $271 and $223 for the three months ended June 30, 2022, and March 31, 2022, respectively. |
| (4) | Includes dividends received on restricted stock. |
| For the Six Months Ended | ||||||||||||||||||||||||
| June 30, | June 30, | |||||||||||||||||||||||
| 2022 | 2021 | |||||||||||||||||||||||
| Average | Average | Average | Average | |||||||||||||||||||||
| Balance | Interest | Yield/Cost | Balance | Interest | Yield/Cost | |||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loans receivable (3) | $ | 977,336 | $ | 22,253 | 4.60 | % | $ | 1,091,119 | $ | 24,052 | 4.45 | % | ||||||||||||
Investment securities (3) | 173,483 | 2,624 | 3.59 | % | 125,924 | 1,940 | 3.60 | % | ||||||||||||||||
Interest-earning deposits with other banks (4) | 85,807 | 204 | 0.48 | % | 89,477 | 86 | 0.19 | % | ||||||||||||||||
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| |||||||||||||
Total interest-earning assets | 1,236,626 | 25,081 | 4.17 | % | 1,306,520 | 26,078 | 4.08 | % | ||||||||||||||||
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Noninterest-earning assets | 87,382 | 70,850 | ||||||||||||||||||||||
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Total assets | $ | 1,324,008 | $ | 1,377,370 | ||||||||||||||||||||
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Interest-bearing liabilities: | ||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 165,066 | $ | 119 | 0.15 | % | $ | 205,063 | $ | 141 | 0.14 | % | ||||||||||||
Money market deposits | 184,988 | 440 | 0.48 | % | 190,502 | 441 | 0.47 | % | ||||||||||||||||
Savings deposits | 260,194 | 78 | 0.06 | % | 254,882 | 85 | 0.07 | % | ||||||||||||||||
Certificates of deposit | 189,203 | 798 | 0.85 | % | 251,711 | 1,548 | 1.24 | % | ||||||||||||||||
Short-term borrowings | — | — | 0.00 | % | 169 | — | 0.00 | % | ||||||||||||||||
Other borrowings | 12,944 | 150 | 2.34 | % | 13,660 | 146 | 2.16 | % | ||||||||||||||||
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| |||||||||||||
Total interest-bearing liabilities | 812,395 | 1,585 | 0.39 | % | 915,987 | 2,361 | 0.52 | % | ||||||||||||||||
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Noninterest-bearing liabilities: | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 367,334 | 309,395 | ||||||||||||||||||||||
Other liabilities | 5,276 | 6,096 | ||||||||||||||||||||||
Stockholders’ equity | 139,003 | 145,892 | ||||||||||||||||||||||
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| |||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,324,008 | $ | 1,377,370 | ||||||||||||||||||||
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|
| |||||||||||||||||||||
Net interest income | $ | 23,496 | $ | 23,717 | ||||||||||||||||||||
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|
|
| |||||||||||||||||||||
Interest rate spread (1) | 3.78 | % | 3.56 | % | ||||||||||||||||||||
Net interest margin (2) | 3.91 | % | 3.71 | % | ||||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 152.22 | % | 142.64 | % | ||||||||||||||||||||
| (1) | Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. |
| (2) | Net interest margin represents net interest income as a percentage of average interest-earning assets. |
| (3) | Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $494 and $347 for the six months ended June 30, 2022 and 2021, respectively. |
| (4) | Includes dividends received on restriced stock. |