DEFIANCE, Ohio, July 23, 2019 /PRNewswire/ -- SB Financial Group, Inc. SBFG ("SB Financial" or the "Company"), a diversified financial services company providing full-service community banking, mortgage banking and wealth management, today reported earnings for the second-quarter and six months ended June 30, 2019.
Second-quarter 2019 highlights over prior-year second quarter include:
- Total assets increased to $1.03 billion, up $84.3 million, or 8.9 percent
- Net income of $2.6 million; adjusted net income due to servicing rights impairment of $3.2 million
- Diluted earnings per share (EPS) of $0.33; adjusted EPS of $0.40
- Tangible book value (TBV) per share increased 8.6 percent to $15.83 per share
Six months ended June 30, 2019, highlights over prior-year six months include:
- Net income of $4.9 million; adjusted net income of $6.0 million, which is up $0.5 million or 8.0 percent
- Diluted EPS of $0.61; adjusted EPS of $0.75
- Return on Average Assets (ROA) of 0.96 percent; adjusted 1.07 percent
- Net interest margin (NIM) of 3.84 percent down 5 basis points
Second-quarter 2019, trailing twelve-month highlights include:
- Loan growth of $61.2 million, or 8.1 percent
- Deposit growth of $86.5 million, or 11.5 percent
- Mortgage origination volume of $324.0 million; servicing portfolio of $1.11 billion
Highlights | Three Months Ended | Six Months Ended | |||||
($ in thousands, except per share & ratios) | Jun. 2019 | Jun. 2018 | % Change | Jun. 2019 | Jun. 2018 | % Change | |
Operating revenue | $12,523 | $12,673 | -1.2% | $23,863 | $24,616 | -3.1% | |
Interest income | 11,151 | 9,732 | 14.6% | 21,649 | 18,583 | 16.5% | |
Interest expense | 2,319 | 1,308 | 77.3% | 4,477 | 2,459 | 82.1% | |
Net interest income | 8,832 | 8,424 | 4.8% | 17,172 | 16,124 | 6.5% | |
Provision for loan losses | 200 | 300 | -33.3% | 200 | 600 | -66.7% | |
Noninterest income | 3,691 | 4,249 | -13.1% | 6,691 | 8,492 | -21.2% | |
Noninterest expense | 9,108 | 8,579 | 6.2% | 17,734 | 17,206 | 3.1% | |
Net income | 2,627 | 3,107 | -15.4% | 4,853 | 5,560 | -12.7% | |
Earnings per diluted share | 0.33 | 0.40 | -17.5% | 0.61 | 0.75 | -18.7% | |
Return on average assets | 1.03% | 1.35% | -23.7% | 0.96% | 1.21% | -20.7% | |
Return on average equity | 7.92% | 10.02% | -21.0% | 7.36% | 9.64% | -23.7% | |
Non-GAAP Measures | |||||||
Adjusted net income | $3,172 | $3,122 | 1.6% | $5,957 | $5,514 | 8.0% | |
Adjusted diluted EPS | 0.40 | 0.40 | 0.0% | 0.75 | 0.74 | 1.4% | |
Adjusted return on average assets | 1.09% | 1.35% | -19.3% | 1.07% | 1.20% | -10.8% | |
Net interest margin (FTE) | 3.88% | 4.14% | -6.3% | 3.84% | 3.89% | -1.3% | |
"We delivered increased second-quarter net income compared to the prior-year quarter, when we adjust for the impairment to our mortgage servicing rights," said Mark A. Klein, Chairman, President and CEO of SB Financial. Our operating results included a very strong loan growth quarter, as we added over $32 million, and over the last 12 months, $61 million. Also, this quarter had a strong rebound in our mortgage origination volume of $98 million, increasing originations over the last 12 months to $324 million."
RESULTS OF OPERATIONS
Consolidated Revenue
Total operating revenue, consisting of net interest income and noninterest income, was down 1.2 percent from the second quarter of 2018, but up 10.4 percent from the linked quarter.
- Net interest income was up 4.8 percent from the year-ago quarter, and up 5.9 percent from the linked quarter.
- Net interest margin (FTE) was down 26 basis points from the year-ago quarter, but up 7 basis points from the linked quarter.
- Noninterest income was down 13.1 percent from the year-ago quarter, but up 23.0 percent from the linked quarter.
Funding costs, primarily from retail deposits have increased from the prior year and from the linked quarter. Deposit cost of funds for the most recent quarter of 1.01 percent are up from the prior year quarter of 0.59 percent. From the linked quarter, deposit cost of funds are up only six basis points from 0.95 percent.
Mortgage Loan Business
Mortgage loan originations for the second quarter of 2019 were $98.4 million, down $11.0 million, or 10.1 percent, from the year-ago quarter. Total sales of originated loans were $71.0 million, down $8.2 million, or 10.3 percent from the year-ago quarter.
Net mortgage banking income, consisting of gains on the sale of mortgage loans and net loan servicing fees, was $1.2 million for the second quarter of 2019, compared to $2.3 million for the year-ago quarter. The mortgage servicing valuation adjustment for the second quarter of 2019 was a negative $0.7 million, compared to a negative adjustment of $0.02 million for the second quarter of 2018. The aggregate servicing valuation impairment ended the quarter at $1.6 million. The mortgage-servicing portfolio at June 30, 2019, was $1.11 billion, up $0.08 billion, or 8.0 percent, from $1.03 billion at June 30, 2018.
Mr. Klein noted, "Although our earnings were impacted by the $0.7 million impairment in the quarter and $1.4 million for all of 2019, we are encouraged by the strong mortgage quarter that included purchase volume of $91 million or 93 percent and refinance volume of $7 million or 7 percent. Our current pipeline exceeds $50 million and we continue to attract targeted clients."
Mortgage Banking | |||||
($ in thousands) | Jun. 2019 | Mar. 2019 | Dec. 2018 | Sep. 2018 | Jun. 2018 |
Mortgage originations | $98,447 | $51,417 | $78,829 | $95,289 | $109,466 |
Mortgage sales | 70,993 | 43,472 | 60,345 | 80,555 | 79,162 |
Mortgage servicing portfolio | 1,112,857 | 1,094,060 | 1,084,678 | 1,066,402 | 1,030,780 |
Mortgage servicing rights | 10,264 | 10,838 | 11,347 | 11,129 | 10,634 |
Mortgage servicing revenue: | |||||
Loan servicing fees | 691 | 682 | 673 | 653 | 636 |
OMSR amortization | (460) | (254) | (300) | (318) | (367) |
Net administrative fees | 231 | 428 | 373 | 335 | 269 |
OMSR valuation adjustment | (690) | (708) | (68) | (62) | (22) |
Net loan servicing fees | (459) | (280) | 305 | 273 | 247 |
Gain on sale of mortgages | 1,678 | 1,192 | 1,646 | 2,066 | 2,058 |
Mortgage banking revenue, net | $1,219 | $912 | $1,951 | $2,339 | $2,305 |
Noninterest Income and Noninterest Expense
SB Financial's noninterest income includes revenue from a diverse group of services, such as wealth management, deposit fees, residential loan sales, title agency revenue and the sale of Small Business Administration (SBA) loans. SBA activity for the quarter consisted of total loan volume of $4.1 million and gains of $0.1 million. Wealth management assets under the Company's care stood at $479.4 million as of June 30, 2019. In the first full quarter of operation, the title agency business delivered revenue of $0.3 million. For the second quarter of 2019, noninterest income as a percentage of total revenue was 29.5 percent, with the YTD percentage at 33.9 percent when adjusted for the impairment.
For the second quarter of 2019, noninterest expense (NIE) of $9.1 million was up $0.5 million, or 6.2 percent, compared to the same quarter last year. Compared to the linked quarter, NIE was also up $0.5 million. Expense growth was the result of higher mortgage commissions, merit increases and the addition of a title agency. We continue to add resources of both technology and personnel in order to meet the expanded needs of our operations, information technology and risk management functions.
Noninterest Income / Noninterest Expense | |||||
($ in thousands, except ratios) | Jun. 2019 | Mar. 2019 | Dec. 2018 | Sep. 2018 | Jun. 2018 |
Noninterest Income (NII) | $3,691 | $3,000 | $3,930 | $4,202 | $4,249 |
NII / Total Revenue | 29.5% | 26.5% | 31.3% | 33.0% | 33.5% |
NII / Average Assets | 1.5% | 1.2% | 1.6% | 1.8% | 1.8% |
Noninterest Expense (NIE) | $9,108 | $8,626 | $8,852 | $8,789 | $8,579 |
Efficiency Ratio | 72.7% | 76.1% | 70.6% | 69.0% | 67.7% |
NIE / Average Assets | 3.6% | 3.5% | 3.6% | 3.7% | 3.7% |
Net Noninterest Expense/Avg. Assets | -2.1% | -2.3% | -2.0% | -1.9% | -1.9% |
Balance Sheet
Total assets as of June 30, 2019, were $1.03 billion, up $84.3 million, or 8.9 percent, from a year ago. Total equity as of June 30, 2019, was $133.9 million, up 7.1 percent from a year ago, and comprised 13.0 percent of total assets.
Total loans held for investment were $814.5 million at June 30, 2019, up $61.2 million, or 8.1 percent, from June 30, 2018 and up $32.0 million or 16.4 percent annualized for the quarter. From the prior year, commercial loans were up $28.7 million, or 24.9 percent, with residential real estate rising $18.9 million, or 10.9 percent.
The investment portfolio of $89.9 million, including Federal Reserve Bank and Federal Home Loan Bank stock, represented 8.7 percent of assets at June 30, 2019. Deposit balances of $839.4 million at June 30, 2019, increased by $86.5 million, or 11.5 percent, since June 30, 2018. Growth from the prior year included $10.3 million in checking and $76.2 million in savings, money market and time deposit balances.
Mr. Klein stated, "Our balance sheet metrics improved this quarter with 16.4 percent annualized loan growth and $12 million in deposit growth. Compared to the prior year, deposit growth of 11.5 percent fully funded our 8.1 percent loan growth. Our asset quality metrics and coverage ratio remain in the top quartile of our peer group."
Loan Balance | ||||||
($ in thousands, except ratios) | Jun. 2019 | Mar. 2019 | Dec. 2018 | Sep. 2018 | Jun. 2018 | Annual |
Commercial | $143,798 | $136,201 | $127,640 | $119,810 | $115,140 | $28,658 |
% of Total | 17.7% | 17.4% | 16.5% | 15.5% | 15.3% | 24.9% |
Commercial RE | 360,491 | 343,900 | 340,791 | 356,563 | 350,266 | 10,225 |
% of Total | 44.2% | 43.9% | 44.2% | 46.2% | 46.5% | 2.9% |
Agriculture | 54,317 | 50,620 | 52,012 | 52,814 | 52,466 | 1,851 |
% of Total | 6.7% | 6.5% | 6.7% | 6.8% | 7.0% | 3.5% |
Residential RE | 191,642 | 187,548 | 187,104 | 178,033 | 172,773 | 18,869 |
% of Total | 23.5% | 24.0% | 24.2% | 23.1% | 22.9% | 10.9% |
Consumer & Other | 64,261 | 64,254 | 64,336 | 64,478 | 62,640 | 1,621 |
% of Total | 7.9% | 8.2% | 8.3% | 8.4% | 8.3% | 2.6% |
Total Loans | $814,509 | $782,523 | $771,883 | $771,698 | $753,285 | $61,224 |
Total Growth Percentage | 8.1% | |||||
Deposit Balance | ||||||
($ in thousands, except ratios) | Jun. 2019 | Mar. 2019 | Dec. 2018 | Sep. 2018 | Jun. 2018 | Annual |
Non-Int DDA | $141,216 | $146,327 | $144,592 | $134,747 | $131,125 | $10,091 |
% of Total | 16.8% | 17.7% | 18.0% | 17.1% | 17.4% | 7.7% |
Interest DDA | 129,710 | 132,101 | 130,628 | 130,897 | 129,486 | 224 |
% of Total | 15.5% | 16.0% | 16.3% | 16.6% | 17.2% | 0.2% |
Savings | 118,931 | 115,272 | 104,444 | 114,213 | 118,108 | 823 |
% of Total | 14.1% | 13.8% | 12.9% | 14.4% | 15.7% | 0.7% |
Money Market | 175,455 | 175,334 | 181,426 | 170,190 | 151,228 | 24,227 |
% of Total | 20.9% | 21.2% | 22.6% | 21.6% | 20.1% | 16.0% |
Certificates | 274,062 | 258,624 | 241,462 | 239,379 | 222,932 | 51,130 |
% of Total | 32.7% | 31.2% | 30.1% | 30.3% | 29.6% | 22.9% |
Total Deposits | $839,374 | $827,658 | $802,552 | $789,426 | $752,879 | $86,495 |
Total Growth Percentage | 11.5% |
Asset Quality
SB Financial's nonperforming assets to total assets ratio of 0.43 percent continues to be in the top quartile of its 65-bank peer group. The coverage of problem loans by the loan loss allowance was at 212 percent at June 30, 2019, down from 264 percent at June 30, 2018.
Summary of Nonperforming Assets | Annual | |||||
($ in thousands, except ratios) | Jun. 2019 | Mar. 2019 | Dec. 2018 | Sep. 2018 | Jun. 2018 | |
Commercial & Agriculture | $674 | $998 | $731 | $360 | $33 | $641 |
% of Total Com./Ag. loans | 0.34% | 0.53% | 0.41% | 0.21% | 0.02% | 1942.4% |
Commercial RE | 208 | 212 | 218 | 228 | 234 | (26) |
% of Total CRE loans | 0.06% | 0.06% | 0.06% | 0.06% | 0.07% | -11.1% |
Residential RE | 1,768 | 1,612 | 1,738 | 1,541 | 1,634 | 134 |
% of Total Res. RE loans | 0.92% | 0.86% | 0.93% | 0.87% | 0.95% | 8.2% |
Consumer & Other | 456 | 325 | 219 | 252 | 221 | 235 |
% of Total Con./Oth. loans | 0.71% | 0.51% | 0.34% | 0.39% | 0.35% | 106.3% |
Total Nonaccruing Loans | 3,106 | 3,147 | 2,906 | 2,381 | 2,122 | 984 |
% of Total loans | 0.38% | 0.40% | 0.38% | 0.31% | 0.28% | 46.4% |
Accruing Restructured Loans | 814 | 827 | 928 | 940 | 1,101 | (287) |
Total Growth (%) | -26.1% | |||||
Total Nonaccruing & Restructured Loans | 3,920 | 3,974 | 3,834 | 3,321 | 3,223 | 697 |
% of Total loans | 0.48% | 0.51% | 0.50% | 0.43% | 0.43% | 21.6% |
Foreclosed Assets | 530 | 313 | 131 | 105 | 16 | 514 |
Total Growth (%) | 3212.5% | |||||
Total Nonperforming Assets | $4,450 | $4,287 | $3,965 | $3,426 | $3,239 | $1,211 |
% of Total assets | 0.43% | 0.42% | 0.40% | 0.35% | 0.34% | 37.4% |
Webcast and Conference Call
The Company will hold a related conference call and webcast on July 24, 2019, at 11:00 a.m. EDT. Interested parties may access the conference call by dialing 1-888-338-9469. The webcast can be accessed at http://www.yoursbfinancial.com/investorrelations.html. An audio replay of the call will be available on the SB Financial website.
About SB Financial Group
Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title). State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 20 offices; 19 in nine Ohio counties and one in Fort Wayne, Indiana, and 25 full-service ATMs. State Bank has seven loan production offices located throughout the Tri-State region of Ohio, Indiana and Michigan. Peak Title provides title insurance and opinions throughout the Tri-State region. SB Financial's common stock is listed on the NASDAQ Capital Market under the symbol "SBFG". SB Financial's preferred stock is listed on the NASDAQ Capital Market under the symbol "SBFGP".
In May 2019, SB Financial was ranked #94 on the American Banker Magazine's list of Top 200 Publicly Traded Community Banks and Thrifts based on three-year average return on equity ("ROE").
Forward-Looking Statements
Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial's Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.
Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this release contains certain non-GAAP financial measures. Management believes that including certain non-GAAP financial measures will provide investors with information useful in understanding the Company's financial performance, its performance trends and financial position. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results.
Investor Contact Information:
Anthony V. Cosentino
Executive Vice President and
Chief Financial Officer
Tony.Cosentino@YourStateBank.com
SB FINANCIAL GROUP, INC. | ||||||||||||||
CONSOLIDATED BALANCE SHEETS - (Unaudited) | ||||||||||||||
June | March | December | September | June | ||||||||||
($ in thousands) | 2019 | 2019 | 2018 | 2018 | 2018 | |||||||||
ASSETS | ||||||||||||||
Cash and due from banks | $ 42,786 | $ 62,962 | $ 48,363 | $ 45,515 | $ 24,413 | |||||||||
Available-for-sale securities | 85,261 | 95,802 | 90,969 | 84,114 | 89,911 | |||||||||
Loans held for sale | 9,579 | 4,346 | 4,445 | 6,888 | 7,551 | |||||||||
Loans, net of unearned income | 814,509 | 782,523 | 771,883 | 771,698 | 753,285 | |||||||||
Allowance for loan losses | (8,306) | (8,121) | (8,167) | (8,489) | (8,494) | |||||||||
Premises and equipment, net | 23,150 | 23,270 | 22,084 | 21,900 | 21,683 | |||||||||
Federal Reserve and FHLB Stock, at cost | 4,648 | 4,123 | 4,123 | 4,123 | 3,748 | |||||||||
Foreclosed assets held for sale, net | 530 | 313 | 131 | 105 | 16 | |||||||||
Interest receivable | 3,209 | 3,123 | 2,822 | 2,433 | 2,000 | |||||||||
Goodwill and other intangibles | 17,836 | 17,838 | 16,401 | 16,404 | 16,406 | |||||||||
Cash value of life insurance | 17,051 | 16,966 | 16,834 | 16,745 | 16,656 | |||||||||
Mortgage servicing rights | 10,264 | 10,838 | 11,365 | 11,129 | 10,633 | |||||||||
Other assets | 8,606 | 7,288 | 5,575 | 6,615 | 6,977 | |||||||||
Total assets | $ 1,029,123 | $ 1,021,271 | $ 986,828 | $ 979,180 | $ 944,785 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||
Deposits | ||||||||||||||
Non interest bearing demand | $ 141,216 | $ 146,327 | $ 144,592 | $ 134,747 | $ 131,125 | |||||||||
Interest bearing demand | 129,710 | 132,101 | 130,628 | 130,897 | 129,486 | |||||||||
Savings | 118,931 | 115,272 | 104,444 | 114,213 | 118,108 | |||||||||
Money market | 175,455 | 175,334 | 181,426 | 170,190 | 151,228 | |||||||||
Time deposits | 274,062 | 258,624 | 241,462 | 239,379 | 222,932 | |||||||||
Total deposits | 839,374 | 827,658 | 802,552 | 789,426 | 752,879 | |||||||||
Repurchase agreements | 13,968 | 12,255 | 15,184 | 15,539 | 18,191 | |||||||||
Federal Home Loan Bank advances | 16,000 | 24,000 | 16,000 | 24,500 | 26,500 | |||||||||
Trust preferred securities | 10,310 | 10,310 | 10,310 | 10,310 | 10,310 | |||||||||
Interest payable | 1,188 | 1,123 | 909 | 891 | 685 | |||||||||
Other liabilities | 14,346 | 14,419 | 11,438 | 11,405 | 11,116 | |||||||||
Total liabilities | 895,186 | 889,765 | 856,393 | 852,071 | 819,681 | |||||||||
Shareholders' Equity | ||||||||||||||
Preferred stock | 13,978 | 13,978 | 13,979 | 13,979 | 13,983 | |||||||||
Common stock | 40,486 | 40,486 | 40,485 | 40,485 | 40,481 | |||||||||
Additional paid-in capital | 15,259 | 15,143 | 15,226 | 15,160 | 15,098 | |||||||||
Retained earnings | 67,236 | 65,438 | 64,012 | 61,854 | 59,503 | |||||||||
Accumulated other comprehensive income/(loss) | 801 | 124 | (552) | (1,654) | (1,240) | |||||||||
Treasury stock | (3,823) | (3,663) | (2,715) | (2,715) | (2,721) | |||||||||
Total equity | 133,937 | 131,506 | 130,435 | 127,109 | 125,104 | |||||||||
Total liabilities and shareholders' equity | $ 1,029,123 | $ 1,021,271 | $ 986,828 | $ 979,180 | $ 944,785 | |||||||||
SB FINANCIAL GROUP, INC. | |||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME - (Unaudited) | |||||||||||||||||
($ in thousands, except per share & ratios) | At and for the Three Months Ended | Six Months Ended | |||||||||||||||
June | March | December | September | June | June | June | |||||||||||
Interest income | 2019 | 2019 | 2018 | 2018 | 2018 | 2019 | 2018 | ||||||||||
Loans | |||||||||||||||||
Taxable | $ 10,182 | $ 9,427 | $ 9,661 | $ 9,499 | $ 8,968 | $ 19,609 | $ 17,108 | ||||||||||
Tax exempt | 73 | 62 | 55 | 42 | 36 | 135 | 57 | ||||||||||
Securities | |||||||||||||||||
Taxable | 802 | 911 | 822 | 610 | 613 | 1,713 | 1,186 | ||||||||||
Tax exempt | 94 | 98 | 100 | 107 | 115 | 192 | 232 | ||||||||||
Total interest income | 11,151 | 10,498 | 10,638 | 10,258 | 9,732 | 21,649 | 18,583 | ||||||||||
Interest expense | |||||||||||||||||
Deposits | 2,092 | 1,918 | 1,776 | 1,472 | 1,091 | 4,010 | 2,066 | ||||||||||
Repurchase agreements & other | 17 | 26 | 10 | 11 | 6 | 43 | 16 | ||||||||||
Federal Home Loan Bank advances | 100 | 100 | 131 | 140 | 110 | 200 | 189 | ||||||||||
Trust preferred securities | 110 | 114 | 107 | 106 | 101 | 224 | 188 | ||||||||||
Total interest expense | 2,319 | 2,158 | 2,024 | 1,729 | 1,308 | 4,477 | 2,459 | ||||||||||
Net interest income | 8,832 | 8,340 | 8,614 | 8,529 | 8,424 | 17,172 | 16,124 | ||||||||||
Provision for loan losses | 200 | - | - | - | 300 | 200 | 600 | ||||||||||
Net interest income after provision | |||||||||||||||||
for loan losses | 8,632 | 8,340 | 8,614 | 8,529 | 8,124 | 16,972 | 15,524 | ||||||||||
Noninterest income | |||||||||||||||||
Wealth Management Fees | 783 | 734 | 717 | 705 | 710 | 1,517 | 1,449 | ||||||||||
Customer service fees | 689 | 631 | 679 | 672 | 675 | 1,320 | 1,319 | ||||||||||
Gain on sale of mtg. loans & OMSR | 1,678 | 1,192 | 1,646 | 2,066 | 2,058 | 2,870 | 3,158 | ||||||||||
Mortgage loan servicing fees, net | (459) | (280) | 305 | 273 | 247 | (739) | 718 | ||||||||||
Gain on sale of non-mortgage loans | 216 | 327 | 295 | 125 | 150 | 543 | 810 | ||||||||||
Title insurance income | 308 | 19 | - | - | - | 327 | - | ||||||||||
Net gain on sales of securities | 206 | - | - | 70 | - | 206 | - | ||||||||||
Gain/(loss) on sale of assets | (5) | (2) | 14 | - | 60 | (7) | 21 | ||||||||||
Other | 275 | 379 | 274 | 291 | 349 | 654 | 1,017 | ||||||||||
Total noninterest income | 3,691 | 3,000 | 3,930 | 4,202 | 4,249 | 6,691 | 8,492 | ||||||||||
Noninterest expense | |||||||||||||||||
Salaries and employee benefits | 5,305 | 4,902 | 5,108 | 5,372 | 5,201 | 10,207 | 10,140 | ||||||||||
Net occupancy expense | 627 | 645 | 600 | 588 | 560 | 1,272 | 1,209 | ||||||||||
Equipment expense | 665 | 711 | 756 | 667 | 637 | 1,376 | 1,466 | ||||||||||
Data processing fees | 488 | 443 | 466 | 489 | 418 | 931 | 856 | ||||||||||
Professional fees | 649 | 617 | 532 | 393 | 504 | 1,266 | 923 | ||||||||||
Marketing expense | 246 | 239 | 262 | 197 | 204 | 485 | 425 | ||||||||||
Telephone and communication | 112 | 115 | 121 | 124 | 128 | 227 | 250 | ||||||||||
Postage and delivery expense | 81 | 84 | 66 | 83 | 63 | 165 | 137 | ||||||||||
State, local and other taxes | 247 | 255 | 180 | 177 | 176 | 502 | 362 | ||||||||||
Employee expense | 236 | 153 | 283 | 243 | 220 | 389 | 386 | ||||||||||
Other expenses | 452 | 462 | 478 | 456 | 468 | 914 | 1,052 | ||||||||||
Total noninterest expense | 9,108 | 8,626 | 8,852 | 8,789 | 8,579 | 17,734 | 17,206 | ||||||||||
Income before income tax expense | 3,215 | 2,714 | 3,692 | 3,942 | 3,794 | 5,929 | 6,810 | ||||||||||
Income tax expense | 588 | 488 | 732 | 824 | 687 | 1,076 | 1,250 | ||||||||||
Net income | $ 2,627 | $ 2,226 | $ 2,960 | $ 3,118 | $ 3,107 | $ 4,853 | $ 5,560 | ||||||||||
Preferred Share Dividends | 243 | 244 | 243 | 244 | 244 | 487 | 488 | ||||||||||
Net income available to common shareholders | 2,384 | 1,982 | 2,717 | 2,874 | 2,863 | 4,366 | 5,072 | ||||||||||
Common share data: | |||||||||||||||||
Basic earnings per common share | $ 0.37 | $ 0.31 | $ 0.42 | $ 0.45 | $ 0.45 | $ 0.68 | $ 0.85 | ||||||||||
Diluted earnings per common share | $ 0.33 | $ 0.28 | $ 0.37 | $ 0.39 | $ 0.40 | $ 0.61 | $ 0.75 | ||||||||||
Average shares outstanding (in thousands): | |||||||||||||||||
Basic: | 6,454 | 6,482 | 6,503 | 6,503 | 6,489 | 6,469 | 5,935 | ||||||||||
Diluted: | 7,967 | 7,994 | 8,030 | 8,022 | 8,003 | 7,982 | 7,454 | ||||||||||
SB FINANCIAL GROUP, INC. | |||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS - (Unaudited) | |||||||||||||||
($ in thousands, except per share & ratios) | At and for the Three Months Ended | Six Months Ended | |||||||||||||
June | March | December | September | June | June | June | |||||||||
SUMMARY OF OPERATIONS | 2019 | 2019 | 2018 | 2018 | 2018 | 2019 | 2018 | ||||||||
Net interest income | $ 8,832 | $ 8,340 | $ 8,614 | $ 8,529 | $ 8,424 | $ 17,172 | $ 16,124 | ||||||||
Tax-equivalent adjustment | 44 | 43 | 41 | 40 | 40 | 87 | 77 | ||||||||
Tax-equivalent net interest income | 8,876 | 8,383 | 8,655 | 8,569 | 8,464 | 17,259 | 16,201 | ||||||||
Provision for loan loss | 200 | - | - | - | 300 | 200 | 600 | ||||||||
Noninterest income | 3,691 | 3,000 | 3,930 | 4,202 | 4,249 | 6,691 | 8,492 | ||||||||
Total operating revenue | 12,523 | 11,340 | 12,544 | 12,731 | 12,673 | 23,863 | 24,616 | ||||||||
Noninterest expense | 9,108 | 8,626 | 8,852 | 8,789 | 8,579 | 17,734 | 17,206 | ||||||||
Pre-tax pre-provision income | 3,415 | 2,714 | 3,692 | 3,942 | 4,094 | 6,129 | 7,410 | ||||||||
Pretax income | 3,215 | 2,714 | 3,692 | 3,942 | 3,794 | 5,929 | 6,810 | ||||||||
Net income | 2,627 | 2,226 | 2,960 | 3,118 | 3,107 | 4,853 | 5,560 | ||||||||
Income available to common shareholders | 2,384 | 1,982 | 2,717 | 2,874 | 2,863 | 4,366 | 5,072 | ||||||||
PER SHARE INFORMATION: | |||||||||||||||
Basic earnings per share (EPS) | $ 0.37 | $ 0.31 | $ 0.42 | $ 0.45 | $ 0.45 | $ 0.68 | $ 0.85 | ||||||||
Diluted earnings per share | 0.33 | 0.28 | 0.37 | 0.39 | 0.40 | 0.61 | 0.75 | ||||||||
Common dividends | 0.090 | 0.085 | 0.085 | 0.080 | 0.080 | 0.175 | 0.155 | ||||||||
Book value per common share | 16.89 | 16.57 | 16.36 | 15.94 | 15.73 | 16.89 | 15.73 | ||||||||
Tangible book value per common share (TBV) | 15.83 | 15.43 | 15.39 | 14.87 | 14.57 | 15.83 | 14.57 | ||||||||
Fully converted TBV per common share | 14.64 | 14.32 | 14.30 | 13.88 | 13.66 | 14.64 | 13.66 | ||||||||
Market price per common share | 16.46 | 18.02 | 16.45 | 20.35 | 20.32 | 16.46 | 20.32 | ||||||||
Market price per preferred share | 16.10 | 19.00 | 17.90 | 20.25 | 19.82 | 16.10 | 19.82 | ||||||||
Market price to TBV | 104.0% | 116.8% | 106.9% | 136.8% | 139.5% | 104.0% | 139.5% | ||||||||
Market price to fully converted TBV | 112.4% | 125.8% | 115.0% | 146.6% | 148.7% | 112.4% | 148.7% | ||||||||
Market price to trailing 12 month EPS | 12.1 | 12.6 | 11.0 | 11.5 | 11.2 | 12.1 | 11.2 | ||||||||
PERFORMANCE RATIOS: | |||||||||||||||
Return on average assets (ROAA) | 1.03% | 0.89% | 1.19% | 1.30% | 1.35% | 0.96% | 1.21% | ||||||||
Pre-tax pre-provision ROAA | 1.34% | 1.08% | 1.48% | 1.64% | 1.78% | 1.22% | 1.61% | ||||||||
Return on average equity | 7.92% | 6.76% | 9.21% | 9.89% | 10.02% | 7.36% | 9.64% | ||||||||
Return on average tangible equity | 10.41% | 8.83% | 12.06% | 13.02% | 13.28% | 9.65% | 13.08% | ||||||||
Efficiency ratio | 72.71% | 76.05% | 70.55% | 69.01% | 67.67% | 74.30% | 69.88% | ||||||||
Earning asset yield | 4.88% | 4.78% | 4.86% | 4.75% | 4.76% | 4.82% | 4.46% | ||||||||
Cost of interest bearing liabilities | 1.28% | 1.20% | 1.15% | 1.00% | 0.80% | 1.24% | 0.75% | ||||||||
Net interest margin | 3.86% | 3.79% | 3.93% | 3.95% | 4.12% | 3.83% | 3.87% | ||||||||
Tax equivalent effect | 0.02% | 0.02% | 0.02% | 0.01% | 0.02% | 0.01% | 0.02% | ||||||||
Net interest margin, tax equivalent | 3.88% | 3.81% | 3.95% | 3.96% | 4.14% | 3.84% | 3.89% | ||||||||
Non interest income/Average assets | 1.45% | 1.20% | 1.58% | 1.75% | 1.84% | 1.33% | 1.85% | ||||||||
Non interest expense/Average assets | 3.58% | 3.45% | 3.56% | 3.65% | 3.72% | 3.52% | 3.74% | ||||||||
Net noninterest/Average assets | 2.13% | 2.25% | 1.98% | 1.91% | 1.88% | 2.19% | 1.89% | ||||||||
ASSET QUALITY RATIOS: | |||||||||||||||
Gross charge-offs | $ 20 | $ 60 | $ 322 | $ 12 | $ 54 | $ 80 | $ 73 | ||||||||
Recoveries | 5 | 13 | 1 | 6 | 29 | 18 | 38 | ||||||||
Net charge-offs | 15 | 47 | 321 | 6 | 25 | 62 | 35 | ||||||||
Nonaccruing loans/ Total loans | 0.38% | 0.40% | 0.38% | 0.31% | 0.28% | 0.38% | 0.28% | ||||||||
Nonperforming loans/ Total loans | 0.48% | 0.51% | 0.50% | 0.43% | 0.43% | 0.48% | 0.43% | ||||||||
Nonperforming assets/ Loans & OREO | 0.55% | 0.55% | 0.51% | 0.44% | 0.43% | 0.55% | 0.43% | ||||||||
Nonperforming assets/ Total assets | 0.43% | 0.42% | 0.40% | 0.35% | 0.34% | 0.43% | 0.34% | ||||||||
Allowance for loan loss/ Nonperforming loans | 211.89% | 204.35% | 213.02% | 255.62% | 263.54% | 211.89% | 263.54% | ||||||||
Allowance for loan loss/ Total loans | 1.02% | 1.04% | 1.06% | 1.10% | 1.13% | 1.02% | 1.13% | ||||||||
Net loan charge-offs/ Average loans (ann.) | 0.01% | 0.02% | 0.17% | 0.00% | 0.01% | 0.02% | 0.01% | ||||||||
Loan loss provision/ Net charge-offs | 1333.33% | 0.00% | 0.00% | 0.00% | 1200.00% | 322.58% | 1714.29% | ||||||||
CAPITAL & LIQUIDITY RATIOS: | |||||||||||||||
Loans/ Deposits | 97.04% | 94.55% | 96.18% | 97.75% | 100.05% | 97.04% | 100.05% | ||||||||
Equity/ Assets | 13.01% | 12.88% | 13.22% | 12.98% | 13.24% | 13.01% | 13.24% | ||||||||
Tangible equity/ Tangible assets | 10.10% | 9.93% | 10.31% | 10.05% | 10.20% | 10.10% | 10.20% | ||||||||
Tangible equity adjusted for conversion | 11.48% | 11.33% | 11.75% | 11.50% | 11.71% | 11.48% | 11.71% | ||||||||
Common equity tier 1 ratio (Bank) - 6/19 est. | 13.03% | 12.71% | 12.57% | 12.16% | 11.91% | 13.03% | 11.91% | ||||||||
END OF PERIOD BALANCES | |||||||||||||||
Total assets | $1,029,123 | $1,021,271 | $986,828 | $979,180 | $944,785 | $1,029,123 | $944,785 | ||||||||
Total loans | 814,509 | 782,523 | 771,883 | 771,698 | 753,285 | 814,509 | 753,285 | ||||||||
Deposits | 839,374 | 827,658 | 802,552 | 789,426 | 752,879 | 839,374 | 752,879 | ||||||||
Stockholders equity | 133,937 | 131,506 | 130,435 | 127,109 | 125,104 | 133,937 | 125,104 | ||||||||
Goodwill & intangibles | 17,836 | 17,838 | 16,401 | 16,404 | 16,406 | 17,836 | 16,406 | ||||||||
Preferred equity | 13,978 | 13,978 | 13,979 | 13,979 | 13,983 | 13,978 | 13,983 | ||||||||
Tangible equity | 102,123 | 99,690 | 100,055 | 96,726 | 94,715 | 102,123 | 94,715 | ||||||||
Mortgage servicing portfolio | 1,112,857 | 1,094,060 | 1,084,678 | 1,066,402 | 1,030,780 | 1,112,857 | 1,030,780 | ||||||||
Wealth/Brokerage assets under care | 479,442 | 462,580 | 423,289 | 412,218 | 407,592 | 479,442 | 407,592 | ||||||||
Total assets under care | 2,621,422 | 2,577,911 | 2,494,795 | 2,457,800 | 2,383,157 | 2,621,422 | 2,383,157 | ||||||||
Full-time equivalent employees (actual) | 250 | 256 | 250 | 250 | 241 | 250 | 241 | ||||||||
Period end basic shares outstanding | 6,451 | 6,460 | 6,503 | 6,503 | 6,502 | 6,451 | 6,502 | ||||||||
Period end outstanding (Series A Converted) | 1,478 | 1,475 | 1,472 | 1,470 | 1,453 | 1,478 | 1,453 | ||||||||
Market capitalization (all) | 130,324 | 144,898 | 133,824 | 162,711 | 161,851 | 130,324 | 161,851 | ||||||||
AVERAGE BALANCES | |||||||||||||||
Total assets | $1,016,493 | $1,001,282 | $994,977 | $962,369 | $922,355 | $1,008,559 | $920,024 | ||||||||
Total earning assets | 914,652 | 879,394 | 875,747 | 864,490 | 817,270 | 897,611 | 832,849 | ||||||||
Total loans | 804,716 | 775,280 | 775,060 | 770,948 | 724,710 | 790,080 | 737,544 | ||||||||
Deposits | 827,615 | 812,190 | 803,928 | 769,266 | 739,877 | 819,252 | 745,231 | ||||||||
Stockholders equity | 132,734 | 131,691 | 128,539 | 126,144 | 123,990 | 131,861 | 115,387 | ||||||||
Intangibles | 17,837 | 16,880 | 16,403 | 16,405 | 16,407 | 17,359 | 16,409 | ||||||||
Preferred equity | 13,978 | 13,979 | 13,979 | 13,983 | 13,983 | 13,978 | 13,983 | ||||||||
Tangible equity | 100,919 | 100,832 | 98,157 | 95,756 | 93,600 | 100,524 | 84,995 | ||||||||
Average basic shares outstanding | 6,454 | 6,482 | 6,503 | 6,503 | 6,489 | 6,469 | 5,935 | ||||||||
Average diluted shares outstanding | 7,967 | 7,994 | 8,030 | 8,022 | 8,003 | 7,982 | 7,454 | ||||||||
SB FINANCIAL GROUP, INC. | ||||||||||
Rate Volume Analysis - (Unaudited) | ||||||||||
At and for the Three Months Ended June 30, 2019 and 2018 | ||||||||||
($ in thousands) | Three Months Ended Jun. 30, 2019 | Three Months Ended Jun. 30, 2018 | ||||||||
Average | Average | Average | Average | |||||||
Assets | Balance | Interest | Rate | Balance | Interest | Rate | ||||
Taxable securities | $ 100,768 | $ 802 | 3.18% | $ 80,610 | $ 612 | 3.04% | ||||
Nontaxable securities | 9,168 | 94 | 4.10% | 11,950 | 115 | 3.85% | ||||
Loans, net | 804,716 | 10,255 | 5.10% | 724,710 | 9,004 | 4.97% | ||||
Total earning assets | 914,652 | 11,151 | 4.88% | 817,270 | 9,731 | 4.76% | ||||
Cash and due from banks | 36,908 | 32,930 | ||||||||
Allowance for loan losses | (8,232) | (8,178) | ||||||||
Premises and equipment | 23,555 | 21,476 | ||||||||
Other assets | 49,610 | 58,857 | ||||||||
Total assets | $ 1,016,493 | $ 922,355 | ||||||||
Liabilities | ||||||||||
Savings, MMDA and interest bearing demand | $ 422,327 | $ 740 | 0.70% | $ 393,507 | $ 303 | 0.31% | ||||
Time deposits | 261,746 | 1,352 | 2.07% | 214,928 | 788 | 1.47% | ||||
Repurchase agreements & other | 13,645 | 17 | 0.50% | 15,646 | 6 | 0.15% | ||||
Advances from Federal Home Loan Bank | 16,000 | 100 | 2.50% | 20,655 | 110 | 2.13% | ||||
Trust preferred securities | 10,310 | 110 | 4.27% | 10,310 | 100 | 3.88% | ||||
Total interest bearing liabilities | 724,028 | 2,319 | 1.28% | 655,046 | 1,307 | 0.80% | ||||
Non interest bearing demand | 143,542 | - | 131,442 | - | ||||||
Total funding | 867,570 | 1.07% | 786,488 | 0.66% | ||||||
Other liabilities | 16,189 | 11,877 | ||||||||
Total liabilities | 883,759 | 798,365 | ||||||||
Equity | 132,734 | 123,990 | ||||||||
Total liabilities and equity | $ 1,016,493 | $ 922,355 | ||||||||
Net interest income | $ 8,832 | $ 8,424 | ||||||||
Net interest income as a percent of average interest-earning assets - GAAP measure | 3.86% | 4.12% | ||||||||
Net interest income as a percent of average interest-earning assets - non GAAP | 3.88% | 4.14% | ||||||||
- Computed on a fully tax equivalent (FTE) basis | ||||||||||
Six Months Ended Jun. 30, 2019 | Six Months Ended Jun. 30, 2018 | |||||||||
Average | Average | Average | Average | |||||||
Assets | Balance | Interest | Rate | Balance | Interest | Rate | ||||
Taxable securities | $ 98,203 | 1,713 | 3.49% | $ 83,225 | 1,186 | 2.85% | ||||
Nontaxable securities | 9,328 | 192 | 4.12% | 12,080 | 232 | 3.84% | ||||
Loans, net | 790,080 | 19,744 | 5.00% | 737,544 | 17,165 | 4.65% | ||||
Total earning assets | 897,611 | 21,649 | 4.82% | 832,849 | 18,583 | 4.46% | ||||
Cash and due from banks | 41,724 | 27,773 | ||||||||
Allowance for loan losses | (8,258) | (8,311) | ||||||||
Premises and equipment | 23,536 | 21,855 | ||||||||
Other assets | 53,946 | 45,858 | ||||||||
Total assets | $ 1,008,559 | $ 920,024 | ||||||||
Liabilities | ||||||||||
Savings, MMDA and interest bearing demand | $ 422,494 | $ 1,462 | 0.69% | $ 393,384 | 559 | 0.28% | ||||
Time deposits | 255,734 | 2,548 | 1.99% | 215,208 | 1,507 | 1.40% | ||||
Repurchase agreements & Other | 15,663 | 43 | 0.55% | 13,196 | 16 | 0.24% | ||||
Advances from Federal Home Loan Bank | 16,133 | 200 | 2.48% | 22,786 | 189 | 1.66% | ||||
Trust preferred securities | 10,310 | 224 | 4.35% | 10,310 | 188 | 3.65% | ||||
Total interest bearing liabilities | 720,334 | 4,477 | 1.24% | 654,884 | 2,459 | 0.75% | ||||
Non interest bearing demand | 141,024 | 1.04% | 136,639 | 0.62% | ||||||
Total funding | 861,358 | 791,523 | ||||||||
Other liabilities | 15,340 | 13,114 | ||||||||
Total liabilities | 876,698 | 804,637 | ||||||||
Equity | 131,861 | 115,387 | ||||||||
Total liabilities and equity | $ 1,008,559 | $ 920,024 | ||||||||
Net interest income | $ 17,172 | $ 16,124 | ||||||||
Net interest income as a percent of average interest-earning assets - GAAP measure | 3.83% | 3.87% | ||||||||
Net interest income as a percent of average interest-earning assets - non GAAP | 3.84% | 3.89% | ||||||||
- Computed on a fully tax equivalent (FTE) basis | ||||||||||
Non-GAAP reconciliation | 2nd Quarter | Year to Date | ||||||
3 Months ended | 3 Months ended | 6 Months ended | 6 Months ended | |||||
($ in thousands, except per share & ratios) | June 30, 2019 | June 30, 2018 | June 30, 2019 | June 30, 2018 | ||||
Total Revenues | $ 12,523 | $ 12,673 | $ 23,863 | $ 24,616 | ||||
Adjustment to remove temporary impairment* | 690 | 22 | 1,398 | (70) | ||||
Adjusted Total Revenues | $ 13,213 | $ 12,695 | $ 25,261 | $ 24,546 | ||||
Income before Income Taxes | $ 3,215 | $ 3,794 | $ 5,929 | $ 6,810 | ||||
Adjustment to remove temporary impairment | 690 | 22 | 1,398 | (70) | ||||
Adjusted Income before Income Taxes | $ 3,905 | $ 3,816 | $ 7,327 | $ 6,740 | ||||
Provision for Income Taxes | $ 588 | $ 687 | $ 1,076 | $ 1,250 | ||||
Adjustment to remove temporary impairment | 145 | 7 | 294 | (24) | ||||
Adjusted Provision for Income Taxes | $ 733 | $ 694 | $ 1,370 | $ 1,226 | ||||
Net Income | $ 2,627 | $ 3,107 | $ 4,853 | $ 5,560 | ||||
Adjustment to remove temporary impairment | 545 | 15 | 1,104 | (46) | ||||
Adjusted Net Income | $ 3,172 | $ 3,122 | $ 5,957 | $ 5,514 | ||||
Diluted Earnings per Share | $ 0.33 | $ 0.40 | $ 0.61 | $ 0.75 | ||||
Adjustment to remove temporary impairment | 0.07 | 0.00 | 0.14 | (0.01) | ||||
Adjusted Diluted Earnings per Share | $ 0.40 | $ 0.40 | $ 0.75 | $ 0.74 | ||||
Return on Average Assets | 1.03% | 1.35% | 0.96% | 1.21% | ||||
Adjustment to remove temporary impairment | 0.05% | 0.00% | 0.11% | -0.01% | ||||
Adjusted Return on Average Assets | 1.09% | 1.35% | 1.07% | 1.20% | ||||
* temporary valuation adjustment to the | ||||||||
Company's mortgage servicing rights | ||||||||
View original content:http://www.prnewswire.com/news-releases/sb-financial-group-inc-announces-second-quarter-and-six-month-2019-earnings-300889578.html
SOURCE SB Financial Group, Inc.
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