Elmira Savings Bank Reports Second Quarter Earnings

Elmira, New York, UNITED STATES


ELMIRA, N.Y., July 18, 2018 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

  • Net income was $1,163,000 and $2,294,000 for the three and six months ended June 30, 2018 compared to $1,108,000 and $2,187,000 for the same periods in 2017.

  • Diluted earnings per share were $.33 per share and $.66 per share for the three and six months ended June 30, 2018 compared to $.27 per share and $.56 per share for the same periods in 2017. 

  • Return on average assets was .83% for both the three and six months ended June 30, 2018 compared to .79% and .78% for the same periods in 2017.

  • Return on average equity was 8.11% and 8.07% for the three and six months ended June 30, 2018 compared to 7.01% and 7.35% for the same periods in 2017.

“The increase in net income combined with the effect of our capital restructuring last year has improved diluted earnings per share by 18% for the first half of 2018 compared to the same period one year ago,” said Thomas M. Carr, President and CEO. 

Net Income

Net income totaled $2,294,000 for the six months ended June 30, 2018, an increase of $107,000 or 5% from the $2,187,000 of net income recorded for the same period in 2017.  This increase was the net result of a decrease in noninterest expense of $49,000, a decrease in the provision for loan losses of $128,000, and a decrease in tax expense of $407,000, offset by a decrease in noninterest income of $373,000 and a decrease in net interest income of $104,000.

Net income totaled $1,163,000 for the three months ended June 30, 2018, an increase of $55,000 or 5% from the $1,108,000 recorded for the same period in 2017.  This increase was the net result of a decrease in noninterest expense of $49,000, a decrease in the provision for loan losses of $130,000, and a decrease in tax expense of $204,000, offset by a decrease in noninterest income of $222,000 and a decrease in net interest income of $106,000.

Basic and diluted earnings per share for the six months ended June 30, 2018 were both $.66 per share compared to $.56 per share for both for the same period in 2017.  Basic and diluted earnings per share for the three months ended June 30, 2018 were both $.33 per share compared to $.27 per share for both for the same period in 2017.  Per share data has been restated to reflect the 5% stock dividend paid on June 15, 2018.

Net Interest Margin

The net interest margin for the six months ended June 30, 2018 was 3.35% compared to 3.34% for the same period in 2017.  The yield on average earning assets was 4.19% for the six months ended June 30, 2018 compared to 4.13% for the same period in 2017.  The average cost of interest-bearing liabilities was .99% for the six months ended June 30, 2018 compared to .94% for the same period in 2017.

The net interest margin for the three months ended June 30, 2018 was 3.32% compared to 3.36% for the same period in 2017.  The average yield on earning assets was 4.19% for the three months ended June 30, 2018 compared to 4.15% for the same period in 2017.  The average cost of interest-bearing liabilities was 1.01% for the three months ended June 30, 2018 compared to .94% for the same period in 2017.

Assets

Total assets increased $8.4 million or 1.5% to $562.9 million at June 30, 2018 compared to $554.6 million at December 31, 2017.  Loans, including loans held for sale, decreased 1.4% to $454.3 million at June 30, 2018 compared to December 31, 2017.  The available-for-sale investment portfolio decreased $1.7 million from December 31, 2017 to June 30, 2018.

Nonperforming Loans

Our nonperforming loans to total loans ratio has increased to 0.98% at June 30, 2018 from .64% at December 31, 2017.  Net loan charge-offs to average loans for the six months ended June 30, 2018 of 0.07% was the same as the six months ended June 30, 2017.  The allowance for loan losses was 0.96% of total loans at June 30, 2018 and 0.97% of total loans at December 31, 2017.

Liabilities

Deposits total $468.3 million at June 30, 2018, an increase of $11.5 million or 2.5%.  The $11.5 million increase consists of an $8.7 million increase in time deposits, a $2.9 million increase in savings accounts, a $2.8 million increase in noninterest-bearing accounts, and a $603,000 increase in interest bearing transaction accounts, offset by a $3.4 million decrease in money market accounts.  Borrowed funds totaled at $33.0 million as of June 30, 2018, a decrease of $2.0 million from December 31, 2017.

Shareholders’ Equity

Shareholders’ equity increased $618,000 to $57.3 million at June 30, 2018 compared to December 31, 2017.  The current level of shareholders’ equity equates to a book value per share of $16.36 at June 30, 2018, compared to $16.26 at December 31, 2017.  Dividends paid for common shareholders were $0.23 and $0.45 for the three and six months ended for both June 30, 2018 and 2017.  As a result of the repurchase of all outstanding preferred shares in December 2017, there were no dividends paid for preferred shares for the three or six months ended June 30, 2018 versus $225,000 and $450,000 paid in preferred dividends for the same periods in 2017.

Elmira Savings Bank, with $562.9 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; 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) June 30, December 31,   
     2018   2017  % Change 
ASSETS         
          
Cash and due from banks  $  25,178  $  7,800  222.8% 
Federal funds sold and other short-term investments    95     97  -2.1% 
Total cash and cash equivalents     25,273     7,897  220.0% 
          
Securities available for sale, at fair value    22,375     24,056  -7.0% 
Securities held to maturity - fair value $7,992       
at June 30, 2018, and $8,186 at December 31, 2017    7,773     8,039  -3.3% 
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost   9,632     10,221  -5.8% 
          
Loans held for sale     1,256     1,999  -37.2% 
          
Loans receivable    453,052   458,629  -1.2% 
Less: Allowance for loan losses   4,362   4,442  -1.8% 
Net loans    448,690   454,187  -1.2% 
          
Premises and equipment, net   16,722   16,772  -0.3% 
Bank-owned life insurance   14,253   13,982  1.9% 
Accrued interest receivable   1,043   1,497  -30.3% 
Goodwill    12,320   12,320  0.0% 
Other assets    3,587   3,590  -0.1% 
Total assets   $562,924  $554,560  1.5% 
          
LIABILITIES AND SHAREHOLDERS' EQUITY       
          
Deposits   $468,293  $456,762  2.5% 
Borrowings    33,000   35,000  -5.7% 
Other liabilities    4,332   6,117  -29.2% 
Total liabilities    505,625   497,879  1.6% 
          
Shareholders' equity:        
Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares      
authorized; 10,000 shares issued at June 30, 2018 and at December 31, 2017 9,700   9,700  0.0% 
Common stock, $1 par value; 5,000,000 shares authorized; 3,593,223 shares      
issued at June 30, 2018 and 3,410,622 shares issued at December 31, 2017 3,593   3,411  5.3% 
Additional paid-in capital   53,599   50,258  6.6% 
Retained earnings   2,842   5,493  -48.3% 
Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares      
at June 30, 2018 and December 31, 2017  (12,202)  (12,202) 0.0% 
Accumulated other comprehensive loss  (284)  (31) 816.1% 
Total Elmira Savings Bank shareholders' equity  57,248   56,629  1.1% 
Noncontrolling interest   51   52  -1.9% 
Total shareholders' equity   57,299   56,681  1.1% 
Total liabilities and shareholders' equity $562,924  $554,560  1.5% 
          
    


ELMIRA SAVINGS BANK  
CONSOLIDATED  STATEMENT OF INCOME   
(unaudited)  
               
  Three Months Ended Six Months Ended  
  June 30, June 30,  
(in thousands, except for per share data)  2018  2017 % Change  2018  2017 % Change  
               
Interest and dividend income:              
Interest and fees on loans $4,786 $4,789 -0.1% $9,582 $9,524 0.6%  
Interest and dividends on securities              
Taxable  244  228 7.0%  496  472 5.1%  
Non-taxable  118  156 -24.4%  238  345 -31.0%  
Total interest and dividend income  5,148  5,173 -0.5%  10,316  10,341 -0.2%  
               
Interest expense:              
Interest on deposits  827  720 14.9%  1,577  1,450 8.8%  
Interest on borrowings  241  267 -9.7%  484  532 -9.0%  
Total interest expense  1,068  987 8.2%  2,061  1,982 4.0%  
Net interest income  4,080  4,186 -2.5%  8,255  8,359 -1.2%  
Provision for loan losses  25  155 -83.9%  67  195 -65.6%  
Net interest income after provision for loan losses  4,055  4,031 0.6%  8,188  8,164 0.3%  
               
Noninterest income:              
Service fees  353  361 -2.2%  741  740 0.1%  
Gain on sale of loans held for sale  408  686 -40.5%  786  1,269 -38.1%  
Other service fees  208  186 11.8%  401  362 10.8%  
Earnings on bank-owned life insurance  103  95 8.4%  193  191 1.0%  
Other  58  24 141.7%  119  51 133.3%  
Total noninterest income  1,130  1,352 -16.4%  2,240  2,613 -14.3%  
               
Noninterest expense:              
Salaries and benefits  1,998  1,902 5.0%  3,945  3,861 2.2%  
Net occupancy  369  360 2.5%  798  772 3.4%  
Equipment  345  306 12.7%  682  618 10.4%  
Marketing and public relations  230  207 11.1%  451  407 10.8%  
Professional fees  93  184 -49.5%  270  352 -23.3%  
Other  697  822 -15.2%  1,414  1,599 -11.6%  
Total noninterest expense  3,732  3,781 -1.3%  7,560  7,609 -0.6%  
Income before income taxes  1,453  1,602 -9.3%  2,868  3,168 -9.5%  
Income taxes  290  494 -41.3%  574  981 -41.5%  
Net income  1,163  1,108 5.0%  2,294  2,187 4.9%  
Less: Net income attributable to noncontrolling interest  -  - -   -  - -   
               
Net income attributable to Elmira Savings Bank  1,163  1,108 5.0%  2,294  2,187 4.9%  
               
Dividend on preferred stock  -  225 -100.0%  -  450 -100.0%  
Income available to common shareholders $1,163 $883 31.7% $2,294 $1,737 32.1%  
               
               
Basic earnings per share $0.33 $0.27 22.2% $0.66 $0.56 17.9%  
               
Diluted earnings per share $0.33 $0.27 22.2% $0.66 $0.56 17.9%  
               
Weighted average shares outstanding - basic  3,477,210  3,311,799 5.0%  3,476,037  3,095,219 12.3%  
               
Weighted average shares outstanding - diluted  3,491,182  3,328,514 4.9%  3,490,227  3,113,166 12.1%  
               
Dividends per share $0.23 $0.23 0.0% $0.45 $0.45 0.0%  
               
   Share and per share data has been restated to reflect the 5% stock dividend paid on June 15, 2018.   
   


ELMIRA SAVINGS BANK   
AVERAGE BALANCES AND INTEREST RATES   
                
(Dollars in Thousands)For the Three Months Ended   
 June 30, 2018  June 30, 2017   
ASSETS:Average Balance Interest Average Rate  Average Balance Interest Average Rate   
Loans$450,018 $4,786 4.25%$450,724 $4,789 4.24% 
Short-term investments 479  2 1.39   459  1 0.81   
Securities 40,283  360 3.59   47,115  383 3.25   
Total interest-earning assets 490,780  5,148 4.19   498,298  5,173 4.15   
                
Noninterest-earning assets 68,385       65,224       
                
TOTAL ASSETS$559,165      $563,522       
                
LIABILITIES AND SHAREHOLDERS' EQUITY               
Interest-bearing deposits$386,677 $827 0.86  $378,473 $720 0.76   
Borrowings 34,407  241 2.77   42,000  267 2.52   
Total interest-bearing liabilities 421,084  1,068 1.01   420,473  987 0.94   
                
Noninterest-bearing liabilities 80,595       79,670       
Shareholders' equity 57,486       63,379       
                
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$559,165      $563,522       
Interest rate spread    3.18%     3.21%  
Net interest income/margin  $4,080 3.32%   $4,186 3.36%  
                


ELMIRA SAVINGS BANK   
AVERAGE BALANCES AND INTEREST RATES   
                
(Dollars in Thousands)For the Six Months Ended   
 June 30, 2018  June 30, 2017   
ASSETS:Average Balance Interest Average Rate  Average Balance Interest Average Rate   
Loans$451,681 $9,582 4.25%$451,952 $9,524 4.22% 
Short-term investments 456  3 1.36   1,153  3 0.53   
Securities 40,898  731 3.59   48,399  814 3.37   
Total interest-earning assets 493,035  10,316 4.19   501,504  10,341 4.13   
                
Noninterest-earning assets 63,164       62,457       
                
TOTAL ASSETS$556,199      $563,961       
                
LIABILITIES AND SHAREHOLDERS' EQUITY               
Interest-bearing deposits$384,263 $1,577 0.83  $383,352 $1,450 0.76   
Borrowings 34,958  484 2.75   42,102  532 2.51   
Total interest-bearing liabilities 419,221  2,061 0.99   425,454  1,982 0.94   
                
Noninterest-bearing liabilities 79,675       78,517       
Shareholders' equity 57,303       59,990       
                
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$556,199      $563,961       
Interest rate spread    3.20%     3.19%  
Net interest income/margin  $8,255 3.35%   $8,359 3.34%  
                


     Quarter Ended
(Dollars in Thousands, Except Per Share Data) 6/30/2018 3/31/2018 12/31/2017 9/30/2017 6/30/2017 
Operating Data           
                  
 Net income$1,163 $1,131 $1,449 $1,215 $1,108  
 Net interest income 4,080  4,175  4,142  4,047  4,186  
 Provision for loan losses 25  42  580  120  155  
 Non-interest income, ex. Net security gains 1,130  1,110  1,198  1,626  1,352  
 Non-interest expense 3,732  3,828  4,515  3,760  3,781  
            
Performance Statistics           
                  
 Net interest margin 3.32% 3.38% 3.31% 3.27% 3.36% 
 Annualized return on average assets 0.83% 0.83% 1.03% 0.84% 0.79% 
 Annualized return on average equity 8.11% 8.03% 9.04% 7.32% 7.01% 
 Annualized net loan charge-offs to avg loans 0.09% 0.05% 0.46% 0.03% 0.13% 
 Net charge-offs 96  51  528  28  144  
 Efficiency ratio 71.6% 72.4% 84.6% 66.3% 68.3% 
            
Per Share Data           
                  
 Basic earnings per share$0.33 $0.32 $0.37 $0.29 $0.27  
 Diluted earnings per share 0.33  0.32  0.37  0.29  0.27  
 Dividend declared per share 0.23  0.22  0.22  0.22  0.23  
 Book value 16.36  16.27  16.26  16.04  15.97  
 Common stock price:           
  High 20.60  19.95  19.90  20.10  20.71  
  Low 19.29  19.19  18.00  18.86  18.71  
  Close 20.43  19.52  19.48  19.14  19.33  
 Weighted average common shares:           
  Basic 3,477  3,474  3,467  3,463  3,312  
  Fully diluted 3,491  3,489  3,482  3,478  3,329  
 End-of-period common shares:           
  Issued 3,593  3,591  3,582  3,579  3,575  
  Treasury 94  94  94  94  94  
              
  Share and per share data has been restated to reflect the 5% stock dividend paid on June 15, 2018.   
              
Financial Condition Data:           
General           
 Total assets$562,924 $553,259 $554,560 $565,042 $574,332  
 Loans, net 448,690  447,131  454,187  443,543  448,024  
 Intangibles 12,320  12,320  12,320  12,324  12,329  
 Total deposits 468,293  456,322  456,762  454,826  460,140  
                   
  Noninterest-bearing 76,880  73,540  74,072  75,625  77,027  
                   
  Savings 73,200  70,574  70,339  68,253  70,668  
  NOW 87,402  86,205  86,799  87,612  86,896  
  Money Market 21,934  22,928  25,363  25,184  24,859  
  Time deposits 208,877  203,075  200,189  198,152  200,690  
  Total interest-bearing deposits 391,413  382,782  382,690  379,201  383,113  
                  
 Shareholders' equity 57,299  56,887  56,681  65,590  65,280  
            
Asset Quality           
                  
 Non-performing assets$4,560 $3,181 $2,933 $3,793 $3,494  
 Non-performing assets to total assets 0.81% 0.57% 0.53% 0.67% 0.61% 
 Allowance for loan losses 4,362  4,433  4,442  4,390  4,298  
 Allowance for loan losses to total loans 0.96% 0.98% 0.97% 0.98% 0.95% 
 Allowance for loan losses to           
  non-performing loans 99.18% 142.59% 153.97% 118.46% 129.15% 
 Non-performing loans to total loans 0.98% 0.70% 0.64% 0.84% 0.74% 
            
Capitalization           
                  
 Shareholders' equity to total assets 10.18% 10.28% 10.22% 11.61% 11.37% 
              

For further information contact:
Thomas M. Carr, President & CEO
Elmira Savings Bank
333 East Water Street
Elmira, New York  14901
(607) 735-8660
tcarr@elmirasavingsbank.com