Market Overview

Elmira Savings Bank Reports Third Quarter Earnings

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ELMIRA, N.Y., Oct. 19, 2017 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

  • Net income was $1,215,000 and $3,402,000 for the three and nine months ended September 30, 2017 compared to $1,202,000 and $3,295,000 for the same periods in 2016.
  • Diluted earnings per share were $.30 per share and $.88 per share for the three and nine months ended September 30, 2017 compared to $.36 per share and $.96 per share for the same periods in 2016.
  • Return on average assets was .84% and .80% for the three and nine months ended September 30, 2017 compared to .84% and .78% for the same periods in 2016.
  • Return on average equity was 7.32% and 7.34% for the three and nine months ended September 30, 2017 compared to 8.54% and 7.89% for the same periods in 2016.

"We are pleased with the year-over-year improvement in earnings, highlighted by an increase in our net interest margin which has risen by 11 basis points year-to-year to 3.31% through 2017," said Thomas M. Carr, President and CEO.

Net Income

Net income totaled $3,402,000 for the nine months ended September 30, 2017, an increase of $107,000 or 3% from the $3,295,000 of net income recorded for the same period in 2016.  This increase was the net result of a decrease in noninterest expense of $345,000 and an increase in net interest income of $41,000, offset by a decrease in noninterest income of $266,000, an increase in the provision for loan losses of $3,000, and an increase in tax expense of $10,000.

Net income totaled $1,215,000 for the three months ended September 30, 2017, an increase of $13,000 or 1% from the $1,202,000 recorded for the same period in 2016.  This increase was the net result of a decrease in noninterest expense of $216,000 and a decrease in tax expense of $84,000, offset by a decrease in noninterest income of $90,000, a decrease in net interest income of $164,000, and an increase in the provision for loan losses of $33,000.

Basic and diluted earnings per share for the nine months ended September 30, 2017 were $.89 per share and $.88 per share compared to $.96 per share for both for the same period in 2016.  Basic and diluted earnings per share for the three months ended September 30, 2017 were both $.30 per share compared to $.36 per share for both for the same period in 2016.

Net Interest Margin

The net interest margin for the nine months ended September 30, 2017 was 3.31% compared to 3.20% for the same period in 2016.  The yield on average earning assets was 4.12% for the nine months ended September 30, 2017 compared to 4.06% for the same period in 2016.  The average cost of interest-bearing liabilities was .94% for the nine months ended September 30, 2017 compared to 1.01% for the same period in 2016.

The net interest margin for the three months ended September 30, 2017 was 3.27% compared to 3.24% for the same period in 2016.  The average yield on earning assets was 4.09% for the three months ended September 30, 2017 compared to 4.04% for the same period in 2016.  The average cost of interest-bearing liabilities was 0.96% for both the three months ended September 30, 2017 and 2016.

Assets

Total assets decreased $8.4 million or 1.5% to $565.0 million at September 30, 2017 compared to $573.5 million at December 31, 2016.  Loans, including loans held for sale, decreased 2.1% to $449.8 million at September 30, 2017 compared to December 31, 2016.  The available-for-sale investment portfolio decreased $6.4 million from December 31, 2016 to September 30, 2017.

Nonperforming Loans

Our nonperforming loans to total loans ratio has decreased to 0.84% at September 30, 2017 from 1.11% at December 31, 2016.  Net loan charge-offs to average loans for the nine months ended September 30, 2017 of 0.03% decreased from 0.04% for the nine months ended September 30, 2016.  The allowance for loan losses was 0.98% of total loans at September 30, 2017 and 0.94% of total loans at December 31, 2016.

Liabilities

Deposits total $454.8 million at September 30, 2017, a decrease of $14.7 million or 3.1%.  The $14.7 million decrease consists of a $15.7 million decrease in time deposits, a $3.7 million decrease in money market accounts, and a $2.4 million decrease in savings accounts, partially offset by a $1.8 million increase in interest bearing transaction accounts and a $5.3 million increase in noninterest bearing accounts.  Borrowed funds decreased by $5.0 million or 11.9%.

Shareholders' Equity

Shareholders' equity increased $9.9 million to $65.6 million at September 30, 2017 compared to December 31, 2016.  The increase in shareholders' equity includes the impact of the gross $9.5 million received from the private placement of 548,430 common shares in April 2017.  The current level of shareholders' equity equates to a book value per share of $16.84 at September 30, 2017, compared to $16.74 at December 31, 2016.  Dividends paid to common shareholders were $0.23 and $0.70 for the three and nine months ended September 30, 2017 and were $0.23 and $0.69 for the three and nine months ended September 30, 2016.

Elmira Savings Bank, with $565.0 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with six offices in Chemung County, NY; three offices in Tompkins County, NY; two offices in Steuben County, NY; one office in Cayuga County, NY; one office in Schuyler County, NY; and a loan center in Broome County, NY.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank's regulatory reports.

             
ELMIRA SAVINGS BANK
CONSOLIDATED BALANCE SHEET
(unaudited)
                 
(in thousands, except for share and per share data)   September 30,   December 31,    
          2017       2016     % Change
ASSETS                
                 
Cash and due from banks     $ 28,253     $ 24,195     16.8 %
Federal funds sold and other short-term investments     97       99     -2.0 %
Total cash and cash equivalents       28,350       24,294     16.7 %
                 
Securities available for sale, at fair value     26,182       32,581     -19.6 %
Securities held to maturity - fair value $8,306            
at September 30, 2017 and $8,679 at December 31, 2016   8,160       8,519     -4.2 %
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost   10,169       9,811     3.6 %
                 
Loans held for sale       1,909       3,597     -46.9 %
                 
Loans receivable         447,933       455,931     -1.8 %
Less: Allowance for loan losses       4,390       4,263     3.0 %
Net loans         443,543       451,668     -1.8 %
                 
Premises and equipment, net       16,486       12,634     30.5 %
Bank-owned life insurance       13,888       13,592     2.2 %
Accrued interest receivable       1,074       1,552     -30.8 %
Intangible assets, net       4       20     -80.0 %
Goodwill         12,320       12,320     0.0 %
Other assets         2,957       2,862     3.3 %
Total assets       $ 565,042     $ 573,450     -1.5 %
   <
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