Southern States Bancshares, Inc. Announces First Quarter 2022 Financial Results
First Quarter 2022 Highlights
- Linked-quarter loan growth was 19.4% annualized
- Net income of $4.6 million, or $0.50 per diluted share
- Core net income(1) of $4.8 million, or $0.53 per diluted share(1)
- Return on average assets (“ROAA”) of 1.03%; return on average stockholders’ equity (“ROAE”) of 10.43%; and return on average tangible common equity (“ROATCE”)(1) of 11.63%
- Core ROAA(1) of 1.09%; and core ROATCE(1) of 12.31%
- Implemented a stock repurchase program that authorized the purchase of up to $10.0 million of our common stock, of which approximately 287,000 shares were purchased at a weighted average price of $21.35
- Completed a $48.0 million subordinated debt offering at a five-year annual fixed rate of 3.5% per annum, payable quarterly in arrears, with a maturity date of February 7, 2032
(1) See "Reconciliation of Non-GAAP Financial Measures" below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
ANNISTON, Ala., April 25, 2022 (GLOBE NEWSWIRE) -- Southern States Bancshares, Inc. (NASDAQ: SSBK) (“Southern States” or the “Company”), the holding company for Southern States Bank, an Alabama state-chartered commercial bank (the “Bank”), today reported net income of $4.6 million, or $0.50 diluted earnings per share, for the first quarter of 2022. This compares to net income of $4.1 million, or $0.44 diluted earnings per share, for the fourth quarter of 2021, and net income of $5.7 million, or $0.73 diluted earnings per share, for the first quarter of 2021. The Company reported core net income of $4.8 million, or $0.53 diluted core earnings per share, for the first quarter of 2022. This compares to core net income of $4.3 million, or $0.47 diluted core earnings per share, for the fourth quarter of 2021, and core net income of $3.8 million, or $0.49 diluted core earnings per share, for the first quarter of 2021 (see “Reconciliation of Non-GAAP Financial Measures”).
Stephen Whatley, Chairman and Chief Executive Officer of Southern States, said, “We generated robust lending activity again in the first quarter, building on the momentum we established in 2021 with linked-quarter loan growth of 19.4%. Our investment in talent, combined with an economically vibrant footprint that presents ongoing organic expansion opportunities, positions us well for the year ahead.”
“Our focus on disciplined growth enabled us to bolster net interest income while holding the line on expenses and improving our core efficiency ratio. As always, we are committed to strong credit quality and our loan portfolio bears this out as nonperforming loans totaled just 0.25% of total loans. Our commitment to excellent customer service, sound underwriting and responsible growth continually strengthens the franchise and serves our shareholders well through all credit cycles,” said Mr. Whatley.
Net Interest Income and Net Interest Margin
Net interest income for the first quarter of 2022 was $14.7 million, an increase of 4.0% from $14.1 million for the fourth quarter of 2021. The increase was primarily attributable to an increase in interest-earning assets.
Relative to the first quarter of 2021, net interest income increased $2.4 million, or 19.3%. The increase was substantially the result of an increase in interest-earning assets.
Net interest margin for the first quarter of 2022 was 3.53%, compared to 3.68% for the fourth quarter of 2021. The decrease was primarily the result of a decline in the yield on interest-earning assets and, to a lesser degree, an increase in the cost of funds.
Relative to the first quarter of 2021, net interest margin decreased from 3.97%. The decrease was primarily due to a decline in the yield on interest-earning assets that more than offset a decrease in the cost of funds.
Noninterest Income
Noninterest income for the first quarter of 2022 was $1.3 million, a decrease of 23.9% from $1.8 million for the fourth quarter of 2021. The decrease was substantially the result of a decline in gains on the sale of SBA/USDA loans and a $361,000 net loss on securities during the first quarter of 2022.
Relative to the first quarter of 2021, noninterest income decreased 70.4% from $4.5 million. First quarter 2021 results included a gain of $2.8 million on the sale of a USDA loan and additional income from interest rate swaps resulting from elevated transaction volume.
Noninterest Expense
Noninterest expense for the first quarter of 2022 was $9.3 million, down from $9.6 million for the fourth quarter of 2021. The decrease was primarily attributable to a reduction in occupancy expense during the first quarter of 2022 and a net loss related to OREO properties during the fourth quarter of 2021.
Relative to the first quarter of 2021, noninterest expense increased 8.9% from $8.5 million. The increase was primarily attributable to higher salaries and employee benefits expense as production personnel were added in the Georgia market, and higher insurance and professional fees as a result of going public, net of elevated SBA expense during the first quarter of 2021.
Loan Portfolio
Total loans outstanding, before allowance for loan losses, were $1.3 billion at March 31, 2022, up $59.8 million from December 31, 2021 and up from $1.1 billion at March 31, 2021. The linked-quarter increase in loans was primarily attributable to an increase in commercial real estate loans.
Deposits
Total deposits were $1.5 billion at March 31, 2022, compared with $1.6 billion at December 31, 2021 and $1.3 billion at March 31, 2021. The $14.6 million net decrease in total deposits from December 31, 2021 was due to a decrease of $26.4 million in noninterest-bearing deposits that more than offset an increase of $11.8 million in interest-bearing account balances.
Asset Quality
Nonperforming loans totaled $3.2 million, or 0.25% of gross loans, at March 31, 2022, compared with $2.0 million, or 0.16% of gross loans, at December 31, 2021, and $3.9 million, or 0.35% of gross loans, at March 31, 2021. The $1.3 million increase in nonperforming loans from December 31, 2021 was primarily attributable to a commercial real estate loan associated with one borrower that was placed on nonaccrual. The $611,000 reduction in nonperforming loans from March 31, 2021 was primarily attributable to one commercial real estate loan that was moved back to accruing status, one construction and development loan that was paid off, one residential mortgage loan that was paid off, and partially offset by commercial real estate loan associated with one borrower.
The Company recorded a provision for loan losses of $700,000 for the first quarter of 2022, compared to $732,000 for the fourth quarter of 2021. The provision was primarily due to loan growth.
Net charge-offs for the first quarter of 2022 were $52,000, or 0.02% of average loans on an annualized basis, compared to net recoveries of $15,000, or 0.00% of average loans on an annualized basis, for the fourth quarter of 2021, and net charge-offs of $4,000, or 0.00% of average loans on an annualized basis, for the first quarter of 2021.
The Company’s allowance for loan losses was 1.18% of total loans and 477.26% of nonperforming loans at March 31, 2022, compared with 1.19% of total loans and 752.74% of nonperforming loans at December 31, 2021.
Capital
As of March 31, 2022, total stockholders’ equity was $169.2 million, compared with $177.2 million at December 31, 2021. The decrease of $8.0 million was primarily due to a decrease in accumulated other comprehensive income resulting from changes in the value of the available for sale securities portfolio due to rapid increases in interest rates during the quarter.
In connection with its recently announced stock repurchase program, the Company repurchased 287,244 shares of its common stock during the first quarter of 2022 at an average price of $21.35 per share.
About Southern States Bancshares, Inc.
Headquartered in Anniston, Alabama, Southern States Bancshares, Inc. is a bank holding company that operates primarily through its wholly-owned subsidiary, Southern States Bank. The Bank is a full service community banking institution, which offers an array of deposit, loan and other banking-related products and services to businesses and individuals in its communities. The Bank operates 15 branches in Alabama and Georgia and a loan production office in Atlanta.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws, which reflect our current expectations and beliefs with respect to, among other things, future events and our financial performance. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. This may be especially true given the current COVID-19 pandemic and uncertainty about its continuation. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the dates made, we cannot give any assurance that such expectations will prove correct and actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 under the section entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors”. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict.
These statements are often, but not always, made through the use of words or phrases such as “may,” “can,” “should,” “could,” “to be,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “likely,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “target,” “project,” “would” and “outlook,” or the negative version of those words or other similar words or phrases of a future or forward-looking nature. Forward-looking statements appear in a number of places in this earnings release and may include statements about business strategy and prospects for growth, operations, ability to pay dividends, competition, regulation and general economic conditions.
Contact Information:
Lynn Joyce (205) 820-8065
ljoyce@ssbank.bank
Kevin Dobbs (310) 622-8245
ssbankir@finprofiles.com
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands, except share amounts)
| March 31, 2022 | December 31, 2021 | March 31, 2021 | ||||
| (Unaudited) | (Audited) | (Audited) | ||||
| Assets | ||||||
| Cash and due from banks | $ | 22,851 | $ | 6,397 | $ | 17,536 |
| Interest-bearing deposits in banks | 111,951 | 203,537 | 129,071 | |||
| Federal funds sold | 74,022 | 74,022 | 24,121 | |||
| Total cash and cash equivalents | 208,824 | 283,956 | 170,728 | |||
| Securities available for sale, at fair value | 151,027 | 132,172 | 106,217 | |||
| Securities held to maturity, at amortized cost | 19,667 | 19,672 | — | |||
| Other equity securities, at fair value | 8,937 | 9,232 | 4,995 | |||
| Restricted equity securities, at cost | 2,825 | 2,600 | 2,788 | |||
| Loans held for sale | 2,509 | 2,400 | 2,268 | |||
| Loans, net of unearned income | 1,310,070 | 1,250,300 | 1,083,274 | |||
| Less allowance for loan losses | 15,492 | 14,844 | 12,605 | |||
| Loans, net | 1,294,578 | 1,235,456 | 1,070,669 | |||
| Premises and equipment, net | 28,065 | 27,044 | 24,900 | |||
| Accrued interest receivable | 4,427 | 4,170 | 4,088 | |||
| Bank owned life insurance | 29,343 | 22,201 | 22,583 | |||
| Annuities | 15,523 | 12,888 | 12,920 | |||
| Foreclosed assets | 2,930 | 2,930 | 10,230 | |||
| Goodwill | 16,862 | 16,862 | 16,862 | |||
| Core deposit intangible | 1,434 | 1,500 | 1,698 | |||
| Other assets | 11,883 | 9,509 | 8,290 | |||
Total assets | $ | 1,798,834 | $ | 1,782,592 | $ | 1,459,236 |
| Liabilities and Stockholders' Equity | ||||||
| Liabilities: | ||||||
| Deposits: | ||||||
| Noninterest-bearing | $ | 515,110 | $ | 541,546 | $ | 365,114 |
| Interest-bearing | 1,026,729 | 1,014,905 | 894,930 | |||
| Total deposits | 1,541,839 | 1,556,451 | 1,260,044 | |||
Other borrowings | — | 12,498 | 7,982 | |||
| FHLB advances | 25,950 | 25,950 | 31,900 | |||
| Subordinated notes | 47,154 | — | 4,497 | |||
| Accrued interest payable | 107 | 132 | 274 | |||
| Other liabilities | 14,595 | 10,363 | 9,939 | |||
| Total liabilities | 1,629,645 | 1,605,394 | 1,314,636 | |||
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands, except share amounts)
| March 31, 2022 (Unaudited) | December 31, 2021 (Audited) | March 31, 2021 (Audited) | |||||
| Stockholders' equity: | |||||||
| Common stock | 43,749 | 45,064 | 38,582 | ||||
| Capital surplus | 76,426 | 80,640 | 65,886 | ||||
| Retained earnings | 53,604 | 49,858 | 39,173 | ||||
| Accumulated other comprehensive income (loss) | (3,755 | ) | 2,113 | 1,808 | |||
| Unvested restricted stock | (835 | ) | (477 | ) | (849 | ) | |
Total stockholders' equity | 169,189 | 177,198 | 144,600 | ||||
| Total liabilities and stockholders' equity | $ | 1,798,834 | $ | 1,782,592 | $ | 1,459,236 | |
| Shares issued and outstanding | 8,749,878 | 9,012,857 | 7,716,428 | ||||
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share amounts)
| For the Three Months Ended | |||||||||
| March 31, | December 31, | March 31, | |||||||
| 2022 | 2021 | 2021 | |||||||
| Interest income: | |||||||||
| Loans, including fees | $ | 14,766 | $ | 14,280 | $ | 13,021 | |||
| Taxable securities | 619 | 459 | 401 | ||||||
| Nontaxable securities | 299 | 294 | 207 | ||||||
| Other interest and dividends | 188 | 138 | 48 | ||||||
| Total interest income | 15,872 | 15,171 | 13,677 | ||||||
Interest expense: | |||||||||
| Deposits | 873 | 955 | 1,190 | ||||||
| Other borrowings | 345 | 120 | 203 | ||||||
| Total interest expense | 1,218 | 1,075 | 1,393 | ||||||
Net interest income | 14,654 | 14,096 | 12,284 | ||||||
| Provision for loan losses | 700 | 732 | 750 | ||||||
| Net interest income after provision for loan losses | 13,954 | 13,364 | 11,534 | ||||||
Noninterest income: | |||||||||
| Service charges on deposit accounts | 445 | 428 | 360 | ||||||
| Swap fees | 15 | (6 | ) | 558 | |||||
| SBA/USDA fees | 388 | 533 | 2,865 | ||||||
| Mortgage origination fees | 286 | 269 | 407 | ||||||
| Net gain (loss) on securities | (361 | ) | (40 | ) | (232 | ) | |||
| Other operating income | 560 | 567 | 538 | ||||||
| Total noninterest income | 1,333 | 1,751 | 4,496 | ||||||
Noninterest expenses: | |||||||||
| Salaries and employee benefits | 5,725 | 5,563 | 5,057 | ||||||
| Equipment and occupancy expenses | 705 | 943 | 879 | ||||||
| Data processing fees | 564 | 563 | 514 | ||||||
| Regulatory assessments | 263 | 263 | 221 | ||||||
| Other operating expenses | 2,033 | 2,280 | 1,861 | ||||||
| Total noninterest expenses | 9,290 | 9,612 | 8,532 | ||||||
Income before income taxes | 5,997 | 5,503 | 7,498 | ||||||
Income tax expense | 1,440 | 1,445 | 1,817 | ||||||
Net income | $ | 4,557 | $ | 4,058 | $ | 5,681 | |||
Basic earnings per share | $ | 0.51 | $ | 0.45 | $ | 0.74 | |||
Diluted earnings per share | $ | 0.50 | $ | 0.44 | $ | 0.73 | |||
The following table provides an analysis of the allowance for loan losses as of the dates indicated.
| Three Months Ended | |||||||||
| March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||
| (Dollars in thousands) | |||||||||
| Average loans, net of unearned income | $ | 1,278,413 | $ | 1,191,688 | $ | 1,066,556 | |||
| Loans, net of unearned income | $ | 1,310,070 | $ | 1,250,300 | $ | 1,083,274 | |||
| Allowance for loan losses at beginning of the period | $ | 14,844 | $ | 14,097 | $ | 11,859 | |||
| Charge-offs: | |||||||||
| Construction and development | 66 | — | — | ||||||
| Residential | — | — | 16 | ||||||
| Commercial | — | — | — | ||||||
| Commercial and industrial | — | — | — | ||||||
| Consumer and other | 6 | — | 2 | ||||||
| Total charge-offs | 72 | — | 18 | ||||||
| Recoveries: | |||||||||
| Construction and development | — | — | — | ||||||
| Residential | 17 | 13 | 2 | ||||||
| Commercial | — | — | — | ||||||
| Commercial and industrial | — | 1 | 11 | ||||||
| Consumer and other | 3 | 1 | 1 | ||||||
| Total recoveries | 20 | 15 | 14 | ||||||
Net charge-offs (recovery) | $ | 52 | $ | (15 | ) | $ | 4 | ||
Provision for loan losses | $ | 700 | $ | 732 | $ | 750 | |||
| Balance at end of period | $ | 15,492 | $ | 14,844 | $ | 12,605 | |||
| Ratio of allowance to end of period loans | 1.18 | % | 1.19 | % | 1.16 | % | |||
| Ratio of net charge-offs (recovery) to average loans | 0.00 | % | 0.00 | % | 0.00 | % | |||
The following table sets forth the allocation of the Company’s nonperforming assets among different asset categories as of the dates indicated. Nonperforming assets consist of nonperforming loans plus OREO and repossessed property. Nonperforming loans include nonaccrual loans and loans past due 90 days or more.
| March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||
| (Dollars in thousands) | |||||||||
| Nonaccrual loans | $ | 3,246 | $ | 1,478 | $ | 3,857 | |||
| Past due loans 90 days or more and still accruing interest | — | 494 | — | ||||||
| Total nonperforming loans | 3,246 | 1,972 | 3,857 | ||||||
| OREO | 2,930 | 2,930 | 10,229 | ||||||
| Total nonperforming assets | $ | 6,176 | $ | 4,902 | $ | 14,086 | |||
Troubled debt restructured loans – nonaccrual(1) | 904 | 940 | 731 | ||||||
| Troubled debt restructured loans - accruing | 1,058 | 1,072 | 1,005 | ||||||
| Total troubled debt restructured loans | $ | 1,962 | $ | 2,012 | $ | 1,736 | |||
Allowance for loan losses | $ | 15,492 | $ | 14,844 | $ | 12,605 | |||
| Gross loans outstanding at the end of period | $ | 1,314,066 | $ | 1,254,117 | $ | 1,087,461 | |||
| Allowance for loan losses to gross loans | 1.18 | % | 1.18 | % | 1.16 | % | |||
| Allowance for loan losses to nonperforming loans | 477.26 | % | 752.74 | % | 326.81 | % | |||
| Nonperforming loans to gross loans | 0.25 | % | 0.16 | % | 0.35 | % | |||
| Nonperforming assets to gross loans and OREO | 0.47 | % | 0.39 | % | 1.28 | % | |||
Nonaccrual loans by category: | |||||||||
| Real Estate: | |||||||||
| Construction & Development | $ | 76 | $ | 346 | $ | 1,062 | |||
| Residential Mortgages | 510 | 167 | 825 | ||||||
| Commercial Real Estate Mortgages | 2,388 | 674 | 1,572 | ||||||
| Commercial & Industrial | 269 | 285 | 383 | ||||||
| Consumer and other | 3 | 6 | 15 | ||||||
| $ | 3,246 | $ | 1,478 | $ | 3,857 | ||||
(1) Troubled debt restructured loans are excluded from nonperforming loans unless they otherwise meet the definition of nonaccrual loans or are more than 90 days past due.
The following tables show the average outstanding balance of each principal category of our assets, liabilities and stockholders’ equity, together with the average yields on our assets and average costs of our liabilities for the periods indicated. Yields and costs are calculated by dividing the annualized income or expense by the average daily balances of the corresponding assets or liabilities for the same period.
| Three Months Ended | |||||||||||||||||||||||||||||
| March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||||||||||||||||||||||
| Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | Average Balance | Interest | Yield/ Rate | |||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||||
| Assets: Interest-earning assets: | |||||||||||||||||||||||||||||
| Gross loans, net of unearned income(1) | $ | 1,278,413 | $ | 14,766 | 4.68 | % | $ | 1,191,688 | $ | 14,280 | 4.75 | % | $ | 1,066,556 | $ | 13,021 | 4.95 | % | |||||||||||
| Taxable securities | 106,820 | $ | 619 | 2.35 | % | 86,292 | 459 | 2.11 | % | 78,354 | $ | 401 | 2.08 | % | |||||||||||||||
| Nontaxable securities | 54,863 | $ | 299 | 2.21 | % | 53,909 | 294 | 2.16 | % | 33,255 | $ | 207 | 2.52 | % | |||||||||||||||
| Other interest-earnings | 244,202 | $ | 188 | 0.31 | % | 187,601 | 138 | 0.29 | % | 78,154 | $ | 48 | 0.25 | % | |||||||||||||||
| Total interest-earning assets | $ | 1,684,298 | $ | 15,872 | 3.82 | % | $ | 1,519,490 | $ | 15,171 | 3.96 | % | $ | 1,256,319 | $ | 13,677 | 4.42 | % | |||||||||||
| Allowance for loan losses | (15,041 | ) | (14,421 | ) | (12,138 | ) | |||||||||||||||||||||||
| Noninterest-earning assets | 117,758 | 123,735 | 123,941 | ||||||||||||||||||||||||||
| Total Assets | $ | 1,787,015 | $ | 1,628,804 | $ | 1,368,122 | |||||||||||||||||||||||
Liabilities and Stockholders’ Equity: Interest-bearing liabilities: | |||||||||||||||||||||||||||||
| Interest-bearing transaction accounts | 110,983 | 26 | 0.09 | % | 101,863 | 25 | 0.10 | % | 88,578 | 18 | 0.08 | % | |||||||||||||||||
| Savings and money market accounts | 675,504 | 591 | 0.36 | % | 599,948 | 625 | 0.41 | % | 440,803 | 677 | 0.62 | % | |||||||||||||||||
| Time deposits | 237,411 | 256 | 0.44 | % | 263,646 | 305 | 0.46 | % | 324,668 | 495 | 0.62 | % | |||||||||||||||||
| FHLB advances | 25,950 | 22 | 0.34 | % | 25,950 | 22 | 0.34 | % | 33,244 | 51 | 0.62 | % | |||||||||||||||||
| Other borrowings | 32,924 | 323 | 3.98 | % | 12,498 | 98 | 3.11 | % | 12,755 | 152 | 4.82 | % | |||||||||||||||||
| Total interest-bearing liabilities | $ | 1,082,772 | $ | 1,218 | 0.46 | % | $ | 1,003,905 | $ | 1,075 | 0.42 | % | $ | 900,048 | $ | 1,393 | 0.63 | % | |||||||||||
Noninterest-bearing liabilities: | |||||||||||||||||||||||||||||
| Noninterest-bearing deposits | $ | 514,456 | $ | 439,142 | $ | 316,553 | |||||||||||||||||||||||
| Other liabilities | 12,543 | 9,844 | 8,532 | ||||||||||||||||||||||||||
| Total noninterest-bearing liabilities | $ | 526,999 | $ | 448,986 | $ | 325,085 | |||||||||||||||||||||||
| Stockholders’ Equity | 177,244 | 175,913 | 142,989 | ||||||||||||||||||||||||||
| Total Liabilities and Stockholders’ Equity | $ | 1,787,015 | $ | 1,628,804 | $ | 1,368,122 | |||||||||||||||||||||||
| Net interest income | $ | 14,654 | $ | 14,096 | $ | 12,284 | |||||||||||||||||||||||
| Net interest spread(2) | 3.36 | % | 3.54 | % | 3.79 | % | |||||||||||||||||||||||
| Net interest margin(3) | 3.53 | % | 3.68 | % | 3.97 | % | |||||||||||||||||||||||
(1) Includes nonaccrual loans.
(2) Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.
(3) Net interest margin is a ratio of net interest income to average interest earning assets for the same period.
| Per Share Information | Three Months Ended | ||||||||
| March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||
| (Dollars in thousands, except share and per share amounts) | |||||||||
| Net income | $ | 4,557 | $ | 4,058 | $ | 5,681 | |||
| Earnings per share - basic | $ | 0.51 | $ | 0.45 | $ | 0.74 | |||
| Earnings per share - diluted | $ | 0.50 | $ | 0.44 | $ | 0.73 | |||
Weighted average shares outstanding | 8,935,384 | 9,012,857 | 7,681,578 | ||||||
| Diluted weighted average shares outstanding | 9,065,364 | 9,125,872 | 7,794,859 | ||||||
| Shares issued and outstanding | 8,749,878 | 9,012,857 | 7,716,428 | ||||||
| Total stockholders' equity | $ | 169,189 | $ | 177,198 | $ | 144,600 | |||
| Book value per share | $ | 19.34 | $ | 19.66 | $ | 18.74 | |||
Performance Ratios | Three Months Ended | ||||||||
| March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||
Net interest margin | 3.53% | 3.68% | 3.97% | ||||||
| Net interest spread | 3.36% | 3.54% | 3.79% | ||||||
| Efficiency ratio | 56.83% | 60.50% | 50.15% | ||||||
| Return on average assets | 1.03% | 0.99% | 1.68% | ||||||
| Return on average stockholders’ equity | 10.43% | 9.15% | 16.11% | ||||||
Core and PPP Loans | March 31, 2022 | December 31, 2021 | March 31, 2021 | ||||||||
| (Dollars in thousands) | |||||||||||
| Core loans | $ | 1,313,173 | $ | 1,244,914 | $ | 1,026,615 | |||||
| PPP loans | 893 | 9,203 | 60,846 | ||||||||
| Unearned income | (3,996 | ) | (3,817 | ) | (4,187 | ) | |||||
| Loans, net of unearned income | 1,310,070 | 1,250,300 | 1,083,274 | ||||||||
| Allowance for loan losses | (15,492 | ) | (14,844 | ) | (12,605 | ) | |||||
| Loans, net | $ | 1,294,578 | $ | 1,235,456 | $ | 1,070,669 | |||||
Reconciliation of Non-GAAP Financial Measures
In addition to reporting GAAP results, the Company reports non-GAAP financial measures in this earnings release and other disclosures. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our performance. While we believe that these non- GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.
The following table provides a reconciliation of the non-GAAP financial measures to their most directly comparable financial measure presented in accordance with GAAP.
Reconciliation of Non-GAAP Financial Measures
| Three MonthsEnded | |||||||||||
| March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||||
| (Dollars in thousands, except share and per share amounts) | |||||||||||
| Net income | $ | 4,557 | $ | 4,058 | $ | 5,681 | |||||
| Add: Merger expenses | — | — | — | ||||||||
| Add: Net OREO write-downs | — | 227 | — | ||||||||
| Less: Gain on sale of USDA loan | — | — | 2,800 | ||||||||
| Less: Loss on securities | (361 | ) | (40 | ) | (232 | ) | |||||
| Less: Tax effect | 94 | 69 | (668 | ) | |||||||
| Core net income | $ | 4,824 | $ | 4,256 | $ | 3,781 | |||||
| Average assets | $ | 1,787,015 | $ | 1,628,804 | $ | 1,368,122 | |||||
Core return on average assets | 1.09 | % | 1.04 | % | 1.12 | % | |||||
| Net income | $ | 4,557 | $ | 4,058 | $ | 5,681 | |||||
| Add: Merger expenses | — | — | — | ||||||||
| Add: Net OREO write-downs | — | 227 | — | ||||||||
| Add: Provision | 700 | 732 | 750 | ||||||||
| Less: Gain on sale of USDA loan | — | — | 2,800 | ||||||||
| Less: Loss on securities | (361 | ) | (40 | ) | (232 | ) | |||||
| Add: Income taxes | 1,440 | 1,445 | 1,817 | ||||||||
| Pretax pre-provision core net income | $ | 7,058 | $ | 6,502 | $ | 5,680 | |||||
| Average assets | $ | 1,787,015 | $ | 1,628,804 | $ | 1,368,122 | |||||
Pretax pre-provision core return on average assets | 1.60 | % | 1.58 | % | 1.68 | % | |||||
Total stockholders' equity | $ | 169,189 | $ | 177,198 | $ | 144,600 | |||||
| Less: Intangible assets | 18,296 | 18,362 | 18,560 | ||||||||
| Less: Monitory interest not included in tangible assets | $ | — | $ | — | $ | — | |||||
| Tangible common equity | $ | 150,893 | $ | 158,836 | $ | 126,040 | |||||
Core net income | $ | 4,824 | $ | 4,256 | $ | 3,781 | |||||
| Diluted weighted average shares outstanding | 9,065,364 | 9,125,872 | 7,794,859 | ||||||||
Diluted core earnings per share | $ | 0.53 | $ | 0.47 | $ | 0.49 | |||||
Common shares outstanding at year or period end | 8,749,878 | 9,012,857 | 7,716,428 | ||||||||
| Tangible book value per share | $ | 17.25 | $ | 17.62 | $ | 16.33 | |||||
Reconciliation of Non-GAAP Financial Measures
| Three Months Ended | ||||||||||||||
| March 31, 2022 | December 31, 2021 | March 31, 2021 | ||||||||||||
| (Dollars in thousands, except share and per share amounts) | ||||||||||||||
| Total assets at end of period | $ | 1,798,834 | $ | 1,782,592 | $ | 1,459,236 | ||||||||
| Less: Intangible assets | 18,296 | 18,362 | 18,560 | |||||||||||
| Adjusted assets at end of period | $ | 1,780,538 | $ | 1,764,230 | $ | 1,440,676 | ||||||||
Tangible common equity to tangible assets | 8.47 | % | 9.00 | % | 8.75 | % | ||||||||
Total average shareholders equity | $ | 177,244 | 175,913 | $ | 142,989 | |||||||||
| Less: Average intangible assets | 18,337 | 18,402 | 18,601 | |||||||||||
| Less: Average monitory interest not included in tangible assets | $ | — | $ | — | $ | — | ||||||||
| Average tangible common equity | $ | 158,907 | $ | 157,511 | $ | 124,388 | ||||||||
| Net income to common shareholders | $ | 4,557 | $ | 4,058 | $ | 5,681 | ||||||||
| Return on average tangible common equity | 11.63 | % | 10.22 | % | 18.52 | % | ||||||||
| Average tangible common equity | $ | 158,907 | $ | 157,511 | $ | 124,388 | ||||||||
| Core net income | $ | 4,824 | $ | 4,256 | $ | 3,781 | ||||||||
| Core return on average tangible common equity | 12.31 | % | 10.72 | % | 12.33 | % | ||||||||
Net interest income | $ | 14,654 | $ | 14,096 | 12,284 | |||||||||
| Add: Noninterest income | 1,333 | 1,751 | 4,496 | |||||||||||
| Less: Gain on sale of USDA loan | — | — | 2,800 | |||||||||||
| Less: Loss on securities | (361 | ) | (40 | ) | (232 | ) | ||||||||
| Operating revenue | $ | 16,348 | $ | 15,887 | $ | 14,212 | ||||||||
Expenses: | ||||||||||||||
| Total noninterest expense | $ | 9,290 | $ | 9,612 | $ | 8,532 | ||||||||
| Less: Merger expenses | — | — | — | |||||||||||
| Less: Net OREO write-down (gains) | — | 227 | — | |||||||||||
| Adjusted noninterest expenses | $ | 9,290 | $ | 9,385 | $ | 8,532 | ||||||||
| Core efficiency ratio | 56.83 | % | 59.07 | % | 60.03 | % | ||||||||
