WOOSTER, Ohio, Oct. 20, 2021 (GLOBE NEWSWIRE) -- Wayne Savings Bancshares, Inc. WAYN, (the "Company"), the holding company parent of Wayne Savings Community Bank, reported net income (unaudited) of $1,952,000 or $0.81 per common share for the quarter ended September 30, 2021, compared to $1,949,000 or $0.77 per common share for the quarter ended September 30, 2020. The increase in net income was due to an increase in net interest income offset by an increase in provision for loan losses, a decrease in non-interest income, and an increase in non-interest expense. The return on average equity and return on average assets for the third quarter of 2021 was 14.76% and 1.23%, respectively, compared to 15.38% and 1.42%, respectively, for the same period in 2020.
The Company reported net income (unaudited) of $5.6 million or $2.30 per common share for the nine months ended September 30, 2021, an increase of $724,000 or 14.7%, compared to $4.9 million or $1.92 per common share for the same period ended September 30, 2020. The increase in net income was due to an increase in net interest income and a decrease in provision for loan losses, partially offset by a decrease in non-interest income, an increase in non-interest expense and an increase in provision for federal income taxes. The return on average equity and return on average assets for the nine months ended September 30, 2021, was 14.17% and 1.21%, respectively, compared to 13.12% and 1.26%, respectively, for the same period in 2020.
President and CEO James R. VanSickle commented, "Wayne Savings has delivered strong financial results and excellent loan and deposit growth during 2021. Our local economy has shown good growth, despite the labor and supply chain disruption stemming from the coronavirus pandemic. The current loan pipeline should allow the Bank to maintain excellent growth during the fourth quarter of 2021. Wayne Savings remains committed to provide exceptional customer service to meet the financial needs of our communities. The team has done an outstanding job, and I could not be prouder of how we have performed by supporting our customers and delivering remarkable results in 2021."
2021 Select Business Highlights
- Net loan balances increased from $391.4 million at December 31, 2020, to $433.2 million for the nine months ended September 30, 2021, an increase of $41.8 million, or 14.2% (annualized). The growth percentage excluding the impact of the Paycheck Protection Program (PPP) loans was 17.9% (annualized). Agriculture and small businesses continue to perform well and provide a strong foundation for our local economy. The Bank has been able to take advantage of our robust local economy and strong loan demand.
- Wayne Savings Bancshares, Inc. announced the opening of a new branch in Washingtonville, Ohio during the second quarter of 2021. This is Wayne Savings Community Bank's first branch in Columbiana County. As a full-service office, Wayne Savings will offer Washingtonville and the surrounding communities an array of consumer and commercial products and services, as well as online and digital solutions to help address customer banking preferences. As of September 30, 2021, the Washingtonville branch had $12.6 million of loans and deposit balances of $4.3 million. Our new office in Washingtonville accounted for about 30% of our 2021 loan growth.
- Wayne Savings Bancshares, Inc. was named to the American Banker magazine's Top 200 Publicly Traded Community Banks and Thrifts in its May 2021 issue. American Banker ranked Wayne Savings Bancshares, Inc. 50th on its Top 200 Publicly Traded Community Banks and Thrifts based on a three-year average return on equity as of December 31, 2020 (Source: Capital Performance Group).
Third Quarter 2021 Financial Highlights
- Net interest income was $5.0 million for the quarter ended September 30, 2021, an increase of $644,000, or 14.9%, compared to the quarter ended September 30, 2020. The net interest margin increased from 3.27% for the quarter ended September 30, 2020, to 3.30% for the comparable period of 2021. Interest income on loans increased by $417,000, or 8.8%, as average loan yields increased 15 bps to 4.88% for the quarter ending September 30, 2021, compared to 4.73% for same period in 2020. The increase primarily related to deferred fees recognized as interest income on the PPP loans and $21.9 million of increased average loan balances for the quarter. Interest income on securities and interest earning cash balances increased by $73,000 as the average balances increased $54.8 million to $175.8 million at September 30, 2021. Average yields on securities and interest earning cash balances declined from 1.13% in 2020 compared to the current yields of 0.94%, due primarily to securities purchased in 2021 during the continued low interest rate environment. Interest expense decreased $154,000 as the quarterly average cost of funds declined to 0.43% for September 30, 2021, from 0.63% at September 30, 2020.
- Provision for loan losses was $177,000 in the third quarter of 2021 compared to $69,000 for the period ending September 30, 2020. This increase in provision for loan losses expense was mainly due to the increased average balance of loans outstanding of $21.9 million and additional specific reserves required during the September 30, 2021 quarter on loans evaluated for impairment.
- Noninterest income totaled $663,000, a decrease of $227,000, or 25.5%, from $890,000 for the quarter ending September 2020, mainly due to a decrease in the gain on sale of loans. Mortgage loan originations were higher in 2020 than in 2021, causing fewer loan sales in 2021 as mortgage loan rates continued at historic low levels during both years.
- Noninterest expense totaled $3.1 million for the three-month period ended September 30, 2021, an increase of $304,000, or 11.0%, compared to the three months ended September 30, 2020, primarily due to increased salaries and employee benefits as the Company added additional sales and sales support staff to facilitate loan growth and expansion into new markets. The Company's efficiency ratio was 54.3% for the quarter ending September 30, 2021 compared to 52.8% for the same period in 2020. Our excellent efficiency ratio is a result of our disciplined expense management philosophy.
2021 Year-to-Date Financial Highlights
- Net interest income was $14.4 million for the nine-month period ended September 30, 2021, an increase of $1.6 million, or 12.8%, compared to the same period in 2020 as the average net loan balances increased $17.0 million from the September 30, 2020 period. Net interest margin for the nine months ended September 30, 2021 and 2020, declined by 14 basis points to 3.23% as the average yield on interest-earning assets decreased 38 basis points and the average rate on interest-bearing liabilities declined by 24 basis points. The decline in our net interest margin over the last few years has been due to the persistence of the low interest rate environment. Interest income on loans increased by $954,000, or 6.8%, as loan yields increased 11 bps to 4.85% at September 30, 2021 compared to 4.74% for same period in the prior year mainly due to the recognition deferred fees as interest income on the PPP loans and $17.0 million of increased average loan balances from the September 30, 2020 year-to-date average balances. Interest income on securities and interest earning cash balances increased by $163,000 as the average balance increased $74.8 million to $179.0 million at September 30, 2021. Average yields on securities declined from 1.54% for the nine-month period ending September 30, 2020, to 1.02% for the same period in 2021, due primarily to securities purchased in 2021 during the continued low interest rate environment. Interest expense decreased $521,000 as the nine-month average cost of funds declined to 0.46% for September 30, 2021, from 0.70% for September 30, 2020.
- Provision for loan losses was $618,000 for the nine-month period ending September 30, 2021, compared to $1.2 million for the prior year. This decrease in provision for loan losses expense was mainly due to the economic impact of the COVID-19 virus requiring additional provision for loan losses during 2020.
- Noninterest income totaled $2.0 million, a decrease of 12.1%, mainly due to the reduction of gain on sale of loans. This is a result of the volume of the single-family mortgage loan sales declining to $12.5 million in 2021 from $20.4 million in 2020.
- Noninterest expense totaled $8.8 million for the nine-month period ended September 30, 2021, an increase of $955,000, or 12.1%, compared to the September 30, 2020 nine-month period. This increase was primarily due to an increase in salaries and employee benefits and net occupancy and equipment expense. These increases were mainly the result of additional sales and sales support staff added to facilitate loan growth and expansion into new markets. The Company's efficiency ratio was 53.8% for the nine-month period ended September 30, 2021 compared to 52.3% for the same period ended September 2020. We are delighted to continue to keep our efficiency lower than many of our peers.
September 30, 2021 Financial Condition
At September 30, 2021, the Company had total assets of $627.6 million, an increase of $36.0 million, from total assets at December 31, 2020. The growth in total assets includes a $41.8 million increase in net loans, primarily due to commercial loan additions, and increase in securities of $22.4 million, partially offset by a $28.2 million decrease in cash and cash equivalents compared to December 31, 2020. The growth in loan balances of $41.8 million, or 10.7% higher than December 31, 2020, was mainly due to growth of non-residential real estate loans and loans secured by farmland and commercial collateral.
The allowance for loan losses increased from $4.7 million at December 31, 2020, to $5.3 million at September 30, 2021. The allowance for loan losses and the related provision for loan losses is based on management's judgment and evaluation of the loan portfolio. Management believes the current allowance for loan losses is adequate, however, changing economic and other conditions may require future adjustments to the allowance for loan losses.
Total nonperforming loans declined to $1.2 million from $1.4 million at December 31, 2020, as the Bank received proceeds from a foreclosure sale and a loan was transferred into foreclosed asset held for sale. Past due loan balances of 30 days and more decreased from $3.0 million at December 31, 2020, to $1.8 million at September 30, 2021, mainly due to decreased commercial loan delinquencies.
Total liabilities increased $35.1 million mostly due to an increase in deposits accounts of $45.5 million caused mainly by organic growth coupled with economic impact stimulus payments and the PPP. The Company is continuing to enhance its deposit products in an effort to serve its customers and increase deposit balances. The increase in deposit accounts in 2021 is mainly due to the high interest "Platinum" checking products that were initially offered in 2017. The "Platinum" products which include both a business and a personal account represent $135.4 million of our deposit balances at September 30, 2021.
Total stockholders' equity increased by $848,000 in the first nine months of 2021. The Company earned $5.6 million of net income for the nine months ended September 30, 2021. The Company's earnings was offset with the repurchase of 107,312 treasury shares, or $2.8 million, and an additional $1.5 million was used to pay dividends.
Established in 1899, Wayne Savings Community Bank, the wholly owned subsidiary of Wayne Savings Bancshares, Inc., has twelve full-service banking locations in the communities of Wooster, Ashland, Millersburg, Rittman, Lodi, North Canton, Creston, Fredericksburg and Washingtonville, Ohio. Additional information about Wayne Savings Community Bank is available at www.waynesavings.com.
Forward-Looking-Statements
This release contains forward-looking statements that are not historical facts and that are intended to be "forward-looking statements" as that term is defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements may include, but are not limited to, statements about the Company's plans, objectives, expectations and intentions and other statements contained in this release that are not historical facts and pertain to the Company's future operating results. When used in this release, the words "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" and similar expressions are generally intended to identify forward-looking statements. Actual results may differ materially from the results discussed in these forward-looking statements, because such statements are inherently subject to significant assumptions, risks and uncertainties, many of which are difficult to predict and are generally beyond the Company's control. These include but are not limited to: the possibility of adverse economic developments that may, among other things, increase default and delinquency risks in the Company's loan portfolios; shifts in interest rates; shifts in the rate of inflation; shifts in the demand for the Company's loan and other products; unforeseen increases in costs and expenses; lower-than-expected revenue or cost savings in connection with acquisitions; changes in accounting policies; changes in the monetary and fiscal policies of the federal government; and changes in laws, regulations and the competitive environment. Unless legally required, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Contact Information:
Myron Swartzentruber
Senior Vice President Chief Financial Officer
(330) 264-5767
| WAYNE SAVINGS BANCSHARES, INC. | |||||||||||||||||
| Selected Condensed Consolidated Financial Data | |||||||||||||||||
| (Dollars in thousands, except share data - unaudited) | |||||||||||||||||
| September | June | March | December | ||||||||||||||
| 2021 | 2021 | 2021 | 2020 | ||||||||||||||
| Interest and dividend income | $ | 5,589 | $ | 5,364 | $ | 5,352 | $ | 5,168 | |||||||||
| Interest expense | 617 | 630 | 670 | 716 | |||||||||||||
| Net interest income | 4,972 | 4,734 | 4,682 | 4,452 | |||||||||||||
| Provision for loan losses | 177 | 278 | 163 | 134 | |||||||||||||
| Net interest income after | |||||||||||||||||
| provision for loan losses | 4,795 | 4,456 | 4,519 | 4,318 | |||||||||||||
| Non-interest income | 663 | 737 | 615 | 742 | |||||||||||||
| Non-interest expense | 3,057 | 2,975 | 2,795 | 2,848 | |||||||||||||
| Income before federal income taxes | 2,401 | 2,218 | 2,339 | 2,212 | |||||||||||||
| Provision for federal income taxes | 449 | 416 | 452 | 439 | |||||||||||||
| Net income | $ | 1,952 | $ | 1,802 | $ | 1,887 | $ | 1,773 | |||||||||
| Earnings per share - basic | $ | 0.81 | $ | 0.73 | $ | 0.76 | $ | 0.71 | |||||||||
| Earnings per share - diluted | $ | 0.80 | $ | 0.72 | $ | 0.76 | $ | 0.68 | |||||||||
| Dividends per share | $ | 0.21 | $ | 0.21 | $ | 0.21 | $ | 0.20 | |||||||||
| Return on average assets | 1.23% | 1.15% | 1.26% | 1.25% | |||||||||||||
| Return on average equity | 14.76% | 13.53% | 14.22% | 13.69% | |||||||||||||
| Shares outstanding | 2,380,374 | 2,401,411 | 2,477,391 | 2,482,886 | |||||||||||||
| Book value per share | $ | 22.25 | $ | 21.66 | $ | 21.14 | $ | 20.99 | |||||||||
| September | June | March | December | ||||||||||||||
| 2020 | 2020 | 2020 | 2019 | ||||||||||||||
| Interest and dividend income | $ | 5,099 | $ | 5,039 | $ | 5,050 | $ | 5,125 | |||||||||
| Interest expense | 771 | 784 | 883 | 956 | |||||||||||||
| Net interest income | 4,328 | 4,255 | 4,167 | 4,169 | |||||||||||||
| Provision for loan losses | 69 | 467 | 620 | 5 | |||||||||||||
| Net interest income after | |||||||||||||||||
| provision for loan losses | 4,259 | 3,788 | 3,547 | 4,164 | |||||||||||||
| Non-interest income | 890 | 846 | 556 | 739 | |||||||||||||
| Non-interest expense | 2,753 | 2,635 | 2,484 | 2,785 | |||||||||||||
| Income before federal income taxes | 2,396 | 1,999 | 1,619 | 2,118 | |||||||||||||
| Provision for federal income taxes | 447 | 348 | 302 | 389 | |||||||||||||
| Net income | $ | 1,949 | $ | 1,651 | $ | 1,317 | $ | 1,729 | |||||||||
| Earnings per share - basic and diluted | $ | 0.77 | $ | 0.64 | $ | 0.51 | $ | 0.66 | |||||||||
| Dividends per share | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 | |||||||||
| Return on average assets | 1.42% | 1.25% | 1.07% | 1.40% | |||||||||||||
| Return on average equity | 15.38% | 13.27% | 10.65% | 14.26% | |||||||||||||
| Shares outstanding | 2,493,706 | 2,542,631 | 2,588,945 | 2,601,836 | |||||||||||||
| Book value per share | $ | 20.39 | $ | 19.75 | $ | 18.77 | $ | 18.60 | |||||||||
| WAYNE SAVINGS BANCSHARES, INC. | |||||||||||||
| Condensed Consolidated Statements of Income | |||||||||||||
| (Dollars in thousands, except share data - unaudited) | |||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||
| September 30, | September 30, | ||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||
| Interest income | $ | 5,589 | $ | 5,099 | $ | 16,305 | $ | 15,188 | |||||
| Interest expense | 617 | 771 | 1,917 | 2,438 | |||||||||
| Net interest income | 4,972 | 4,328 | 14,388 | 12,750 | |||||||||
| Provision for loan losses | 177 | 69 | 618 | 1,156 | |||||||||
| Net interest income after provision for loan losses | 4,795 | 4,259 | 13,770 | 11,594 | |||||||||
| Non-interest income | 663 | 890 | 2,015 | 2,292 | |||||||||
| Non-interest expense | |||||||||||||
| Salaries and employee benefits | 1,779 | 1,530 | 5,051 | 4,462 | |||||||||
| Net occupancy and equipment expense | 468 | 451 | 1,440 | 1,294 | |||||||||
| Federal deposit insurance premiums | 81 | 33 | 165 | 90 | |||||||||
| Franchise taxes | 116 | 106 | 330 | 315 | |||||||||
| Advertising and marketing | 38 | 54 | 105 | 120 | |||||||||
| Legal | 11 | 31 | 48 | 84 | |||||||||
| Professional fees | 18 | 65 | 150 | 159 | |||||||||
| ATM Network | 96 | 91 | 289 | 229 | |||||||||
| Auditing and accounting | 71 | 64 | 217 | 186 | |||||||||
| Stockholder expense | 18 | 16 | 73 | 71 | |||||||||
| Other | 361 | 312 | 959 | 862 | |||||||||
| Total non-interest expense | 3,057 | 2,753 | 8,827 | 7,872 | |||||||||
| Income before federal income taxes | 2,401 | 2,396 | 6,958 | 6,014 | |||||||||
| Provision for federal income taxes | 449 | 447 | 1,317 | 1,097 | |||||||||
| Net income | $ | 1,952 | $ | 1,949 | $ | 5,641 | $ | 4,917 | |||||
| Earnings per share | |||||||||||||
| Basic | $ | 0.81 | $ | 0.77 | $ | 2.30 | $ | 1.92 | |||||
| Diluted | $ | 0.80 | $ | 0.77 | $ | 2.28 | $ | 1.92 | |||||
| WAYNE SAVINGS BANCSHARES, INC. | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (Dollars in thousands, except share data - unaudited) | ||||||||
| September 30, 2021 | December 31, 2020 | |||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 46,280 | $ | 74,490 | ||||
| Securities, net (1) | 121,204 | 98,826 | ||||||
| Loans held for sale | 322 | 861 | ||||||
| Loans receivable, net | 433,172 | 391,352 | ||||||
| Federal Home Loan Bank stock | 4,226 | 4,226 | ||||||
| Premises & equipment, net | 5,348 | 5,467 | ||||||
| Foreclosed assets held for sale, net | 352 | 366 | ||||||
| Bank-owned life insurance | 11,102 | 10,903 | ||||||
| Other assets | 5,556 | 5,100 | ||||||
| TOTAL ASSETS | $ | 627,562 | $ | 591,591 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Deposit accounts | $ | 530,103 | $ | 484,588 | ||||
| Other short-term borrowings | 21,610 | 23,075 | ||||||
| Federal Home Loan Bank advances | 18,000 | 26,000 | ||||||
| Accrued interest payable and other liabilities | 4,886 | 5,813 | ||||||
| TOTAL LIABILITIES | 574,599 | 539,476 | ||||||
| Common stock (3,978,731 shares of $.10 par value issued) | 398 | 398 | ||||||
| Additional paid-in capital | 36,349 | 36,312 | ||||||
| Retained earnings | 41,399 | 37,281 | ||||||
| Shares acquired by ESOP | (6 | ) | (24 | ) | ||||
| Treasury Stock, at cost - 1,598,357 shares and 1,495,845 shares | ||||||||
| at September 30, 2021 and December 31, 2020, respectively. | (25,391 | ) | (22,705 | ) | ||||
| Accumulated other comprehensive income | 214 | 853 | ||||||
| TOTAL STOCKHOLDERS' EQUITY | 52,963 | 52,115 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 627,562 | $ | 591,591 | ||||
| (1) Includes available-for-sale and held-to-maturity classifications. | ||||||||
| Note: The December 31, 2020 Condensed Consolidated Balance Sheet has been derived from the audited Consolidated Balance Sheet as of that date. | ||||||||
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