MCMINNVILLE, Tenn., Nov. 09, 2020 (GLOBE NEWSWIRE) -- Security Bancorp, Inc. (“Company”) (OTCBB: “SCYT”), the holding company for Security Federal Savings Bank of McMinnville, Tennessee, today announced consolidated earnings for the third quarter of its fiscal year ended December 31, 2020.
Net income for the three months ended September 30, 2020 was $561,000, or $1.50 per share, compared to $644,000, or $1.67 per share, for the same quarter last year. For the nine months ended September 30, 2020, the Company’s net income was $1.7 million or $4.38 per share, compared to $1.9 million, or $4.95 per share, for the same period in 2019.
For the three months ended September 30, 2020, net interest income decreased $169,000, or 8.6%, to $1.8 million from $2.0 million for the same period in 2019. For the nine months ended September 30, 2020, net interest income decreased $237,000, or 4.1%, to $5.5 million from $5.8 million for the nine months ended September 30, 2019. The decrease in net interest income for the three months and nine months ended September 30, 2020 was primarily the result of a decrease in interest income and dividends on securities. Net interest income after provision for loan losses for the three months ended September 30, 2020 was $1.7 million, a decrease of $190,000, or 9.9%, from the same period in the previous year. For the nine months ended September 30, 2020, net interest income after provision for loan losses decreased $336,000, or 5.9%, to $5.4 million from $5.7 million for the same period in 2019. The primary reason for this decrease during both the three months and nine months ended September 30, 2020 was a decrease in net interest income as well as an increase in the provision for loan losses.
Non-interest income for the three months ended September 30, 2020 was $565,000 compared to $442,000 for the three months ended September 30, 2019, an increase of $123,000, or 27.8%. The increase was primarily attributable to an increase in the gains on the sale of loans due to an increase in loan and refinance volume. For the nine months ended September 30, 2020, non-interest income was $1.4 million, reflecting an increase of $214,000, or 17.5%, compared to $1.2 million for the same period in 2019. The increase was also attributable to an increase in the gains on the sale of loans.
Non-interest expense for the three months ended September 30, 2020 was $1.5 million and was relatively consistent with the same period in 2019. For the nine months ended September 30, 2020 non-interest expense increased $227,000, or 5.2%, to $4.6 million from $4.4 million for the same period the previous year. For the three months and nine months ended September 30, 2020 the increases are primarily attributable to increases in both employee expenses and deferred compensation expenses.
Consolidated assets of the Company were $245.9 million at September 30, 2020, compared to $224.5 million at December 31, 2019. The $21.4 million, or 9.5%, increase in assets was a result of an increase in cash and due from banks and interest-bearing deposits with banks. Loans receivable, net, increased $3.0 million, or 1.8%, to $174.0 million at September 30, 2020 from $171.0 million at December 31, 2019. The increase in loans receivable was attributable to an increase in commercial real estate loans.
For the three months ended September 30, 2020 the provision for loan losses was $60,000 compared to $39,000 for loan losses for the three months ended September 30, 2019. The provision for loan losses was $140,000 for the nine months ended September 30, 2020 compared to $41,000 in the comparable period in 2019, an increase of $99,000.
Non-performing assets decreased $103,000, or 14.3%, to $617,000 at September 30, 2020 from $720,000 at December 31, 2019. The decrease is attributable to a decrease in other real estate owned. Based on its analysis of delinquent loans, non-performing loans and classified loans, management believes that the Company’s allowance for loan losses of $1.7 million at September 30, 2020 was adequate to absorb known and inherent risks in the loan portfolio at that date. At September 30, 2020, the allowance for loan losses to non-performing assets was 282.17% compared to 231.81% at December 31, 2019.
Investment and mortgage-backed securities available-for-sale increased $2.1 million, or 5.8%, to $37.8 million at September 30, 2020, compared to $35.8 million at December 31, 2019. The increase was due to investment purchases funded by deposit growth. There were no investment and mortgage-backed securities held-to-maturity at September 30, 2020 and December 31, 2019.
Deposits increased $24.9 million, or 13.3%, to $211.9 million at September 30, 2020 from $187.0 million at December 31, 2019. The increase was primarily attributable to increases in consumer and commercial checking accounts, savings, and certificate of deposits balances. The balance in repurchase agreements decreased to $3.6 million at September 30, 2020 compared to $5.4 million at December 31, 2019, reflecting a decrease of $1.8 million, or 32.5%.
Stockholders’ equity increased $1.1 million, or 4.4%, to $25.8 million, or 10.5% of total assets at September 30, 2020 compared to $24.7 million, or 11.0%, of total assets, at December 31, 2019.
The service market area of Security Federal Savings Bank has not been impacted by COVID-19 as widely as other markets, but management will continue to monitor its impact on our market area. This will be an ongoing due diligence factor for the remainder of 2020.
Safe-Harbor Statement
Certain matters in this News Release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may relate to, among others, expectations of the business environment in which the Company operates and projections of future performance. These forward-looking statements are based upon current management expectations, and may, therefore, involve risks and uncertainties. The Company’s actual results, performance, or achievements may differ materially from those suggested, expressed, or implied by forward-looking statements as a result of a wide range of factors including, but not limited to, the general business environment, interest rates, competitive conditions, regulatory changes, and other risks.
Contact:
Joe Pugh
President & Chief Executive Officer
(931) 473-4483
| SECURITY BANCORP, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited) (dollars in thousands) | ||||||||||||
| OPERATING DATA | Three months ended Sept 30, | Nine months ended Sept 30, | ||||||||||
| 2019 | 2020 | 2019 | 2020 | |||||||||
| Interest income | $2,416 | $2,182 | $7,057 | $6,882 | ||||||||
| Interest expense | 452 | 387 | 1,297 | 1,359 | ||||||||
| Net interest income | 1,964 | 1,795 | 5,760 | 5,523 | ||||||||
| Provision for loan losses | 39 | 60 | 41 | 140 | ||||||||
| Net interest income after provision for loan losses | 1,925 | 1,735 | 5,719 | 5,383 | ||||||||
| Non-interest income | 442 | 565 | 1,226 | 1,440 | ||||||||
| Non-interest expense | 1,501 | 1,547 | 4,388 | 4,615 | ||||||||
| Income before income tax expense | 866 | 753 | 2,557 | 2,208 | ||||||||
| Income tax expense | 222 | 192 | 646 | 551 | ||||||||
| Net income | $644 | $561 | $1,911 | $1,657 | ||||||||
| Net Income per share (basic) | $1.67 | $1.50 | $4.95 | $4.38 | ||||||||
| FINANCIAL CONDITION DATA | At Sept 30, 2020 | At December 31, 2019 | ||||||||||
| Total assets | $245,854 | $224,467 | ||||||||||
| Investments and mortgage backed securities - available for sale | 37,846 | 35,774 | ||||||||||
| Loans receivable, net | 173,984 | 170,953 | ||||||||||
| Deposits | 211,940 | 187,039 | ||||||||||
| Repurchase agreements | 3,631 | 5,382 | ||||||||||
| Federal Home Loan Bank Advances | 2,000 | 5,000 | ||||||||||
| Stockholders' equity | 25,797 | 24,699 | ||||||||||
| Non-performing assets | 617 | 720 | ||||||||||
| Non-performing assets to total assets | 0.25% | 0.32% | ||||||||||
| Allowance for loan losses | 1,741 | 1,669 | ||||||||||
| Allowance for loan losses to total loans receivable | 0.99% | 0.97% | ||||||||||
| Allowance for loan losses to non-performing assets | 282.17% | 231.81% | ||||||||||