Elmira Savings Bank Reports Third Quarter Earnings

Elmira, New York, UNITED STATES


ELMIRA, N.Y., Oct. 17, 2018 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

  • Net income was $1,010,000 and $3,304,000 for the three and nine months ended September 30, 2018 compared to $1,215,000 and $3,402,000 for the same periods in 2017.
     
  • Diluted earnings per share were $.29 per share and $.95 per share for the three and nine months ended September 30, 2018 compared to $.28 per share and $.84 per share for the same periods in 2017. 
     
  • Return on average assets was .71% and .79% for the three and nine months ended September 30, 2018 compared to .84% and .80% for the same periods in 2017.
     
  • Return on average equity was 6.94% and 7.69% for the three and nine months ended September 30, 2018 compared to 7.32% and 7.34% for the same periods in 2017.

“We are pleased with the positive impact the repurchase of our preferred shares has had on earnings per share, return on equity and on our dividend payout ratio,” said Thomas M. Carr, President and CEO.  Carr continued, “Despite slightly lower earnings, our EPS and ROE has improved for the nine months ending September 30, 2018 compared to the same period one year ago.”

Net Income

Net income totaled $3,304,000 for the nine months ended September 30, 2018, a decrease of $98,000 or 3% from the $3,402,000 of net income recorded for the same period in 2017.  This decrease was the net result of a decrease in noninterest income of $845,000, an increase in noninterest expense of $82,000, and a decrease in net interest income of $61,000, offset by a decrease in tax expense of $792,000 and a decrease in the provision for loan losses of $98,000.

Net income totaled $1,010,000 for the three months ended September 30, 2018, a decrease of $205,000 or 17% from the $1,215,000 recorded for the same period in 2017.  This decrease was the net result of a decrease in noninterest income of $472,000, an increase in noninterest expense of $131,000, and an increase in the provision for loan losses of $30,000, offset by an increase in interest income of $43,000 and a decrease in tax expense of $385,000.

Basic and diluted earnings per share for the nine months ended September 30, 2018 were both $.95 per share compared to $.85 and $.84 per share for the same period in 2017.  Basic and diluted earnings per share for the three months ended September 30, 2018 were both $.29 per share compared to $.29 and $.28 per share 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 nine months ended September 30, 2018 was 3.32% compared to 3.31% for the same period in 2017.  The yield on average earning assets was 4.19% for the nine months ended September 30, 2018 compared to 4.12% for the same period in 2017.  The average cost of interest-bearing liabilities was 1.02% for the nine months ended September 30, 2018 compared to .94% for the same period in 2017.

The net interest margin for the three months ended September 30, 2018 was 3.26% compared to 3.27% for the same period in 2017.  The average yield on earning assets was 4.19% for the three months ended September 30, 2018 compared to 4.09% for the same period in 2017.  The average cost of interest-bearing liabilities was 1.09% for the three months ended September 30, 2018 compared to .96% for the same period in 2017.

Assets

Total assets increased $16.2 million or 2.9% to $570.8 million at September 30, 2018 compared to $554.6 million at December 31, 2017.  Loans, including loans held for sale, increased 1.9% to $469.5 million at September 30, 2018 compared to December 31, 2017.  The available-for-sale investment portfolio decreased $2.4 million from December 31, 2017 to September 30, 2018.

Nonperforming Loans

Our nonperforming loans to total loans ratio has increased to 0.96% at September 30, 2018 from .64% at December 31, 2017.  Net loan charge-offs to average loans for the nine months ended September 30, 2018 was 0.07% versus 0.03% for the nine months ended September 30, 2017.  The allowance for loan losses was 0.95% of total loans at September 30, 2018 and 0.97% of total loans at December 31, 2017.

Liabilities

Deposits total $474.4 million at September 30, 2018, an increase of $17.7 million or 3.9%.  The $17.7 million increase consists of an $15.4 million increase in time deposits, a $1.4 million increase in savings accounts, a $4.3 million increase in noninterest-bearing accounts, and a $3.0 million increase in interest bearing transaction accounts, offset by a $6.4 million decrease in money market accounts.  Borrowed funds totaled at $33.0 million as of September 30, 2018, a decrease of $2.0 million from December 31, 2017.

Shareholders’ Equity

Shareholders’ equity increased $831,000 to $57.5 million at September 30, 2018 compared to December 31, 2017.  The current level of shareholders’ equity equates to a book value per share of $16.42 at September 30, 2018, compared to $16.26 at December 31, 2017.  Dividends paid for common shareholders were $0.23 and $0.68 for the three and nine months ended September 30, 2018 and $0.22 and $0.66 for the same periods 2017, after adjusting for the 5% stock dividend paid on June 15, 2018.  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 nine months ended September 30, 2018 versus $225,000 and $675,000 paid in preferred dividends for the same periods in 2017.

Elmira Savings Bank, with $570.8 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.

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

        
ELMIRA SAVINGS BANK 
CONSOLIDATED BALANCE SHEET 
(unaudited) 
          
(in thousands, except for share and per share data) September 30, December 31,   
     2018   2017  % Change 
ASSETS         
          
Cash and due from banks  $  18,103  $  7,800  132.1% 
Federal funds sold and other short-term investments    94     97  -3.1% 
  Total cash and cash equivalents     18,197     7,897  130.4% 
          
Securities available for sale, at fair value    21,631     24,056  -10.1% 
Securities held to maturity - fair value $7,762       
  at September 30, 2018, and $8,186 at December 31, 2017   7,646     8,039  -4.9% 
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost   9,675     10,221  -5.3% 
          
Loans held for sale     2,340     1,999  17.1% 
          
Loans receivable      467,134     458,629  1.9% 
Less: Allowance for loan losses     4,421     4,442  -0.5% 
  Net loans      462,713     454,187  1.9% 
          
Premises and equipment, net     16,881     16,772  0.6% 
Bank-owned life insurance     14,349     13,982  2.6% 
Accrued interest receivable     1,509     1,497  0.8% 
Goodwill      12,320     12,320  0.0% 
Other assets      3,524     3,590  -1.8% 
  Total assets   $  570,785  $  554,560  2.9% 
          
LIABILITIES AND SHAREHOLDERS' EQUITY       
          
Deposits   $  474,449  $  456,762  3.9% 
Borrowings      33,000     35,000  -5.7% 
Other liabilities      5,824     6,117  -4.8% 
  Total liabilities      513,273     497,879  3.1% 
          
Shareholders' equity:        
Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares      
  authorized; 10,000 shares issued at September 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 September 30, 2018 and 3,410,622 shares issued at December 31, 2017   3,593     3,411  5.3% 
Additional paid-in capital     53,657     50,258  6.8% 
Retained earnings     3,047     5,493  -44.5% 
Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares      
  at September 30, 2018 and December 31, 2017    (12,202)    (12,202) 0.0% 
Accumulated other comprehensive loss    (334)    (31) 977.4% 
  Total Elmira Savings Bank shareholders' equity    57,461     56,629  1.5% 
Noncontrolling interest     51     52  -1.9% 
  Total shareholders' equity     57,512     56,681  1.5% 
  Total liabilities and shareholders' equity $  570,785  $  554,560  2.9% 
          

 

ELMIRA SAVINGS BANK  
CONSOLIDATED  STATEMENT OF INCOME   
(unaudited)  
               
  Three Months Ended Nine Months Ended  
  September 30, September 30,  
(in thousands, except for per share data)  2018  2017 % Change  2018  2017 % Change  
               
Interest and dividend income:               
  Interest and fees on loans $  4,896 $  4,695 4.3% $  14,478 $  14,219 1.8%  
  Interest and dividends on securities              
  Taxable    246    240 2.5%    742    712 4.2%  
  Non-taxable    118    136 -13.2%    356    481 -26.0%  
  Total interest and dividend income    5,260    5,071 3.7%    15,576    15,412 1.1%  
               
Interest expense:              
  Interest on deposits    932    757 23.1%    2,509    2,207 13.7%  
  Interest on borrowings    238    267 -10.9%    722    799 -9.6%  
  Total interest expense    1,170    1,024 14.3%    3,231    3,006 7.5%  
Net interest income    4,090    4,047 1.1%    12,345    12,406 -0.5%  
Provision for loan losses    150    120 25.0%    217    315 -31.1%  
Net interest income after provision for loan losses    3,940    3,927 0.3%    12,128    12,091 0.3%  
               
Noninterest income:              
  Service fees    344    393 -12.5%    1,085    1,133 -4.2%  
  Gain on sale of loans held for sale    392    906 -56.7%    1,178    2,175 -45.8%  
  Other service fees    214    193 10.9%    615    555 10.8%  
  Earnings on bank-owned life insurance     96    105 -8.6%    289    296 -2.4%  
  Other    108    29 272.4%    227    80 183.8%  
  Total noninterest income    1,154    1,626 -29.0%    3,394    4,239 -19.9%  
               
Noninterest expense:              
  Salaries and benefits    1,975    2,080 -5.0%    5,920    5,941 -0.4%  
  Net occupancy    398    351 13.4%    1,196    1,123 6.5%  
  Equipment    350    317 10.4%    1,032    935 10.4%  
  Marketing and public relations    195    186 4.8%    646    593 8.9%  
  Professional fees    130    156 -16.7%    400    508 -21.3%  
  Other    843    670 25.8%    2,257    2,269 -0.5%  
  Total noninterest expense    3,891    3,760 3.5%    11,451    11,369 0.7%  
Income before income taxes    1,203    1,793 -32.9%    4,071    4,961 -17.9%  
Income taxes    193    578 -66.6%    767    1,559 -50.8%  
Net income    1,010    1,215 -16.9%    3,304    3,402 -2.9%  
Less: Net income attributable to noncontrolling interest    -    -   -     -    -   -   
               
Net income attributable to Elmira Savings Bank    1,010    1,215 -16.9%  3,304  3,402 -2.9%  
               
Dividend on preferred stock    -    225 -100.0%    -    675 -100.0%  
Income available to common shareholders $  1,010 $  990 2.0% $  3,304 $  2,727 21.2%  
               
               
Basic earnings per share $  0.29 $  0.29 0.0% $  0.95 $  0.85 11.8%  
               
Diluted earnings per share $  0.29 $  0.28 3.6% $  0.95 $  0.84 13.1%  
               
Weighted average shares outstanding - basic    3,480,924    3,462,924 0.5%    3,477,690    3,219,108 8.0%  
               
Weighted average shares outstanding - diluted    3,496,810    3,477,499 0.6%    3,492,445    3,235,931 7.9%  
               
Dividends per share $  0.23 $  0.22 4.5% $  0.68 $  0.66 3.0%  
               
   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   
 September 30, 2018  September 30, 2017   
ASSETS:Average Balance Interest Average Rate  Average Balance Interest Average Rate   
Loans$  458,787 $  4,896   4.24%$  446,853 $  4,695   4.17%  
Short-term investments   479    2   1.61     414    1   1.52   
Securities   39,448    362   3.65     45,092    375   3.31   
Total interest-earning assets   498,714    5,260   4.19     492,359    5,071   4.09   
                
Noninterest-earning assets   67,479         79,619       
                
TOTAL ASSETS$  566,193      $  571,978       
                
LIABILITIES AND SHAREHOLDERS' EQUITY               
Interest-bearing deposits$  392,762 $  932   0.94  $  381,146 $  757   0.79   
Borrowings   33,000    238   2.82     41,130    267   2.54   
Total interest-bearing liabilities   425,762    1,170   1.09     422,276    1,024   0.96   
                
Noninterest-bearing liabilities   82,665         83,854       
Shareholders' equity   57,766         65,848       
                
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$  566,193      $  571,978       
Interest rate spread      3.10%       3.13%  
Net interest income/margin  $  4,090   3.26%   $  4,047   3.27%  
                

 

ELMIRA SAVINGS BANK   
AVERAGE BALANCES AND INTEREST RATES   
                
(Dollars in Thousands)For the Nine Months Ended   
 September 30, 2018  September 30, 2017   
ASSETS:Average Balance Interest Average Rate  Average Balance Interest Average Rate   
Loans$  454,076 $  14,478   4.24%$  450,234 $  14,219   4.20%  
Short-term investments   464    5   1.45     894    5   0.69   
Securities   40,409    1,093   3.61     47,284    1,188   3.35   
Total interest-earning assets   494,949    15,576   4.19     498,412    15,412   4.12   
                
Noninterest-earning assets   64,618         68,250       
                
TOTAL ASSETS$  559,567      $  566,662       
                
LIABILITIES AND SHAREHOLDERS' EQUITY               
Interest-bearing deposits$  387,127 $  2,509   0.87  $  382,608 $  2,207   0.77   
Borrowings   34,298    722   2.77     41,775    799   2.52   
Total interest-bearing liabilities   421,425    3,231   1.02     424,383    3,006   0.94   
                
Noninterest-bearing liabilities   80,683         80,315       
Shareholders' equity   57,459         61,964       
                
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$  559,567      $  566,662       
Interest rate spread      3.17%       3.18%  
Net interest income/margin  $  12,345   3.32%   $  12,406   3.31%  
                

 

     Quarter Ended
(Dollars in Thousands, Except Per Share Data) 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 
            
Operating Data           
            
 Net income$  1,010 $  1,163 $  1,131 $  1,449 $  1,215  
 Net interest income   4,090    4,080    4,175    4,142    4,047  
 Provision for loan losses   150    25    42    580    120  
 Non-interest income, ex. Net security gains   1,154    1,130    1,110    1,198    1,626  
 Non-interest expense   3,891    3,732    3,828    4,515    3,760  
            
Performance Statistics           
            
 Net interest margin 3.26% 3.32% 3.38% 3.31% 3.27% 
 Annualized return on average assets 0.71% 0.83% 0.83% 1.03% 0.84% 
 Annualized return on average equity 6.94% 8.11% 8.03% 9.04% 7.32% 
 Annualized net loan charge-offs to avg loans 0.08% 0.09% 0.05% 0.46% 0.03% 
 Net charge-offs   91    96    51    528    28  
 Efficiency ratio 74.2% 71.6% 72.4% 84.6% 66.3% 
            
Per Share Data           
            
 Basic earnings per share$  0.29 $  0.33 $  0.32 $  0.37 $  0.29  
 Diluted earnings per share   0.29    0.33    0.32    0.37    0.28  
 Dividend declared per share   0.23    0.23    0.22    0.22    0.22  
 Book value   16.42    16.36    16.27    16.26    16.04  
 Common stock price:           
  High    21.00    20.60    19.95    19.90    20.10  
  Low   20.10    19.29    19.19    18.00    18.86  
  Close   20.40    20.43    19.52    19.48    19.14  
 Weighted average common shares:           
  Basic    3,481    3,477    3,474    3,467    3,463  
  Fully diluted   3,497    3,491    3,489    3,482    3,478  
 End-of-period common shares:           
  Issued   3,593    3,593    3,591    3,582    3,579  
  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$  570,785 $  562,924 $  553,259 $  554,560 $  565,042  
 Loans, net   462,713    448,690    447,131    454,187    443,543  
 Intangibles   12,320    12,320    12,320    12,320    12,324  
 Total deposits   474,449    468,293    456,322    456,762    454,826  
                   
  Noninterest-bearing   78,324    76,880    73,540    74,072    75,625  
                   
  Savings   71,748    73,200    70,574    70,339    68,253  
  NOW   89,835    87,402    86,205    86,799    87,612  
  Money Market   18,910    21,934    22,928    25,363    25,184  
  Time deposits   215,632    208,877    203,075    200,189    198,152  
  Total interest-bearing deposits   396,125    391,413    382,782    382,690    379,201  
                   
 Shareholders' equity   57,512    57,299    56,887    56,681    65,590  
                  
Asset Quality           
            
 Non-performing assets$  4,520 $  4,560 $  3,181 $  2,933 $  3,793  
 Non-performing assets to total assets 0.79% 0.81% 0.57% 0.53% 0.67% 
 Allowance for loan losses   4,421    4,362    4,433    4,442    4,390  
 Allowance for loan losses to total loans 0.95% 0.96% 0.98% 0.97% 0.98% 
 Allowance for loan losses to            
  non-performing loans 100.00% 99.18% 142.59% 153.97% 118.46% 
 Non-performing loans to total loans 0.96% 0.98% 0.70% 0.64% 0.84% 
            
Capitalization           
            
 Shareholders' equity to total assets 10.08% 10.18% 10.28% 10.22% 11.61%