Randolph Bancorp, Inc. Announces First Quarter 2021 Financial Results

Stoughton, Massachusetts, UNITED STATES


STOUGHTON, Mass., April 27, 2021 (GLOBE NEWSWIRE) -- Randolph Bancorp, Inc. (the “Company”) (NASDAQ Global Market: RNDB), the holding company for Envision Bank (the “Bank”), today announced net income of $4.1 million, or $0.81 per basic share and $0.78 per diluted share, for the three months ended March 31, 2021 compared to net income of $5.3 million, or $1.03 per basic and $1.01 per diluted share for the three months ended December 31, 2020 and a net loss of $0.8 million, or $0.16 per basic and diluted share, for the three months ended March 31, 2020. Excluding one-time charges of $109,000 in severance expenses, earnings were $4.2 million, or $0.79 per diluted share for the three months ended March 31, 2021. Excluding one-time charges of $294,000 related to the closing of a residential lending office and $69,000 in severance expenses, earnings were $5.6 million, or $1.06 per diluted share, for the three months ended December 31, 2020.

At March 31, 2021, total assets amounted to $738.2 million, compared to $721.1 million at December 31, 2020, an increase of $17.1 million, or 2.4%. An increase in cash and cash equivalents of $41.2 million was partially offset by a decrease in loans held for sale of $25.9 million relative to the prior quarter. Compared to March 31, 2020, total assets grew $85.3 million, or 13.1% from $652.9 million. The growth from the prior year period was caused by an increase in loans held for sale of $34.4 million, or 58.5%, an increase in commercial real estate loans of $20.3 million, or 16.1%, and an increase in commercial and industrial loans of $14.8 million, or 164.3%, driven by lending associated with the Small Business Administration’s (the “SBA’s”) Paycheck Protection Program (“PPP”).

William M. Parent, President and Chief Executive Officer, stated, “The first quarter was another strong quarter for our Company, as mortgage refinancing volume, combined with improving banking results, drove performance metrics to elevated levels. We are very pleased with our performance as we migrate our mortgage banking operations from a higher volume refinance environment to more normalized levels while continuing to expand our consumer and commercial banking business. We remain optimistic regarding local economic activity, our ability to continue to grow our business and generate recurring operating leverage.”

First Quarter Operating Results
Net interest income increased by $51,000, or 1.0%, to $5.1 million for the three months ended March 31, 2021 from $5.0 million for the three months ended December 31, 2020. This increase was primarily due to an increase in average loans and a decrease in the cost of funds driven by a shortening of deposit liabilities and a decline in the cost of non-maturity deposits from the prior quarter. The average balance of term certificates decreased $15.3 million, or 13.6%, from the prior quarter and the average balance of savings and NOW accounts increased $19.2 million, or 8.0%, from the prior quarter. This contributed to a decrease of 9 basis points in the cost of interest-bearing liabilities. The net interest margin decreased in the first quarter by 6 basis points to 2.96% from 3.02% in the prior quarter. The change reflects a decrease of 11 basis points in loan yields, due to a decline in the forgiveness of SBA PPP loans, which resulted in a decline in loan yields of 2 basis points, and payoffs of higher yielding loans.

The net interest margin increased in the first quarter of 2021 to 2.96%, from 2.91% in the first quarter of 2020. The change reflects the shortening and downward pricing of deposit liabilities, exceeding the decreases in the rates earned on interest-earning assets because of the lower interest-rate environment. Net interest income increased by $666,000, or 15.1%, to $5.1 million for the three months ended March 31, 2021 from $4.4 million the same period in the prior year. This increase was primarily due to a decrease in deposit costs, complemented by change in the mix of deposits. The average balance of savings and NOW accounts in the first quarter of 2021 increased $55.5 million, or 41.1% and $30.5 million, or 78.0%, respectively, from the prior year quarter and the average balance of term certificates decreased $91.7 million, or 48.6%, from the prior year quarter, contributing to an 80 basis point decrease in the cost of interest-bearing liabilities. This decrease was primarily driven by an 89 basis point decline in the cost of interest-bearing deposits, as market interest rates declined sharply from the prior year.

The Company recognized a credit for loan losses of $213,000 for the quarter ended March 31, 2021, driven by changes in the qualitative factors related to the impact of the COVID-19 pandemic and the economic outlook used in the Company’s calculation. The allowance for loan losses was 1.32%, 1.38% and 1.04% of total loans at March 31, 2021, December 31, 2020 and March 31, 2020, respectively, and was 79.0%, 94.6% and 146.6% of non-performing assets at March 31, 2021, December 31, 2020 and March 31, 2020, respectively.

Non-interest income decreased $3.2 million, or 20.3%, to $12.4 million for the quarter ended March 31, 2021 from $15.6 million in the quarter ended December 31, 2020, due to a decrease of $3.6 million in the net gain on loan origination and sale activities, partially offset by an increase of $504,000 related to net mortgage servicing fees. Sold mortgages totaled $503.3 million in the first quarter of 2021, compared to $426.5 million in the fourth quarter of 2020. The first quarter of 2021 ended with a mortgage pipeline of $239.5 million, compared to a pipeline of $396.6 million at the end of the fourth quarter of 2020, contributing to the decrease in the net gain on loan origination and sales activities. Mortgage servicing fees increased $504,000, or 183.3% for the first quarter of 2021 to $779,000 from $275,000 in the fourth quarter of 2020 due to a fair value adjustment of $421,000 in the first quarter of 2021, based on an increase in mortgage interest rates from the prior quarter.

Non-interest income increased $6.0 million, or 92.6%, to $12.4 million for the quarter ended March 31, 2021 from $6.5 million for the quarter ended March 31, 2020, principally due to an increase of $3.8 million in the net gain on loan origination and sale activities and an increase of $2.0 million in net mortgage servicing fees. Sold mortgage loans totaled $503.3 million in the first quarter of 2021, compared to sold mortgage loans of $217.9 million during the first quarter of 2020. The first quarter of 2021 ended with a mortgage pipeline of $239.5 million, compared to a pipeline of $395.6 million at the end of the first quarter of 2020. Mortgage servicing fees increased $2.0 million in the quarter ended March 31, 2021, principally due to an impairment of mortgage servicing rights of $1.6 in the quarter ended March 31, 2020.

Non-interest expenses decreased $976,000, or 7.6%, to $12.0 million in the quarter ended March 31, 2021 from $12.9 million in the quarter ended December 30, 2020. The decrease was due to a decrease in occupancy and equipment costs of $406,000, or 35.3%, and a provision for unfunded commitments of $584,000 taken in the fourth quarter of 2020. Occupancy and equipment expenses decreased $406,000 in the quarter ended March 31, 2021 from the prior quarter due to the closing of residential lending offices in the fourth quarter of 2020, which resulted in a one-time charge of $294,000. Other non-interest expenses comprising professional fees, marketing, FDIC insurance and other non-interest expenses decreased by $285,000, or 9.3% in the quarter ended March 31, 2021 versus the prior quarter, as the fourth quarter of 2020 included a $584,000 provision for unfunded loan commitments.

Non-interest expenses increased $992,000 to $12.0 million in the quarter ended March 31, 2021 from $11.0 million in the quarter ended March 31, 2020. The increase is principally due to an increase in salaries and employee benefits of $311,000, primarily attributed to higher commissions and incentives associated with increased residential loan production, partially offset by a $1.4 million charge related to the retirement of senior executives in the first quarter of 2020. In addition, other non-interest expenses increased $463,000 from the prior year quarter due to elevated loan production costs. Occupancy and equipment expenses increased $46,000 in the quarter ended March 31, 2021 over the prior year period due to seasonal increases in snowplowing expenses. Other non-interest expenses comprising professional fees, marketing, FDIC insurance and other non-interest expenses increased by $635,000, or 29.7% in the quarter ended March 31, 2021 versus the prior year period, due to elevated mortgage loan production costs.

Balance Sheet
At March 31, 2021, total assets amounted to $738.2 million, compared to $721.1 million at December 31, 2020, an increase of $17.1 million, or 2.4%. A $41.2 million increase in cash and cash equivalents from the prior quarter was partially offset by a $25.9 million decrease in loans held for sale. Net loan growth of $8.4 million, or 1.7%, was driven by SBA PPP loan originations of $10.2 million. SBA PPP loans totaled $14.7 million at the end of the first quarter of 2021. Non-brokered deposits increased by $31.5 million, or 6.3%, to $528.0 million from $496.6 million in the prior quarter.

Total assets at March 31, 2021 increased $85.3 million, or 13.1% from $652.9 million at March 31, 2020. Contributing to asset growth was a $34.4 million increase in loans held for sale to $93.2 million at March 31, 2021 from $58.8 million at March 31, 2020. Cash and cash equivalents increased by $33.7 million, or 159.0%, to $55.0 million at March 31, 2021 from $21.2 million at March 31, 2020, mainly as a result of strong core growth in deposits and higher loan sales at quarter end. Net loans increased by $15.8 million, or 3.3%, to $492.0 million at March 31, 2021 from $476.2 million at March 31, 2020, mainly as a result commercial real estate growth of $20.3 million, or 16.1%, as we focus on diversifying our loan mix and reducing our exposure to long-term fixed rate 1-4 family residential loans. Another factor for net loan growth was an increase in commercial and industrial loans of $14.8 million, or 164.3%, driven by SBA PPP lending.

The increase in total assets at March 31, 2021 from the prior quarter was funded by deposit growth. Non-brokered deposits totaled $528.0 million at March 31, 2021, increasing by $31.5 million, or 6.3%, during the quarter from $496.6 million at December 31, 2020. Driving the growth in non-brokered deposits were customers’ receipt of government stimulus and our focus on deposit gathering. Federal Home Loan Bank of Boston (“FHLBB”) and Federal Reserve Bank advances decreased by $13.3 million to $60.0 million at March 31, 2021, from $73.3 million at December 31, 2020, primarily as a result of the full repayment of Federal Reserve Bank advances.

The increase in total assets from the prior year quarter was also funded by continued deposit growth. Non-brokered deposits totaled $528.0 million at March 31, 2021, increasing by $109.0 million, or 26.0%, during the quarter ended March 31, 2021 from $419.1 million at March 31, 2020. Driving the growth in non-brokered deposits was customers’ receipt of government stimulus and our focus on deposit gathering. Brokered deposits decreased by $53.7 million to $32.2 million at March 31, 2021, from $86.0 million at March 31, 2020. FHLBB advances increased by $8.0 million to $60.0 million at March 31, 2021, from $52.0 million at March 31, 2020.

Total stockholders’ equity was $100.9 million at March 31, 2021 compared to $99.8 million at December 31, 2020. The increase of $1.0 million reflects net income during the first quarter of $4.1 million, partially offset by share repurchases of $2.7 million and a decrease in the fair value of available-for-sale equity securities, net of taxes, of $794,000.

Total stockholders’ equity was $100.9 million at March 31, 2021 compared to $79.0 million at March 31, 2020. The increase of $21.9 million relates mainly to net income from the previous twelve months of $24.9 million, partially offset by share repurchases of $3.2 million and a decrease in the fair value of available-for-sale securities, net of taxes, of $927,000. In addition, equity adjustments related to equity-based compensation amounted to an increase of $1.1 million.

COVID-19 Impact
In response to the impact of the COVID-19 pandemic on our customers and our business, the Company implemented a series of measures through the date of this release, including participation in the PPP, for which we funded $25.6 million of SBA PPP Loans through March 31, 2021, and granting payment deferrals for residential mortgage, home equity and certain commercial borrowers who were current in their payments at the time the deferral was requested. Depending on the circumstances of the borrowers, the forbearance calls for a reduced or full deferral of payment. Please refer to the Loan Payment Deferrals and COVID-19 Most Impacted Sections for statistics on loan payment deferrals and the commercial loan sectors we believe could be exposed to the economic impact of the COVID-19 pandemic.

About Randolph Bancorp, Inc.
Randolph Bancorp, Inc. is the holding company for Envision Bank and its Envision Mortgage Division. Envision Bank is a full-service community bank with five retail branch locations, loan operations centers in North Attleboro and Stoughton, Massachusetts, three loan production offices located in Massachusetts and one loan production office in Southern New Hampshire.

Forward Looking Statements
Certain statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the negative impacts and disruptions of the COVID-19 pandemic and the measures taken to contain its spread on our employees, customers, business operations, credit quality, financial position, liquidity and results of operations; changes in the general business and economic conditions on a national basis and in the local markets in which the Company operates, including changes that adversely affect borrowers’ ability to service and repay the Company’s loans; changes in consumer behavior due to changing political, business and economic conditions or legislative or regulatory initiatives; reputational risk relating to the Company’s participation in the Paycheck Protection Program and other pandemic-related legislative and regulatory initiatives and programs; turbulence in the capital and debt markets and the impact of such conditions on the Company’s business activities; and the risk factors described in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

Non-GAAP Financial Measures
The Company uses certain non-GAAP financial measures, such as return on average assets, return on average equity, the efficiency ratio, profit percentage, tangible book value per share and, where applicable, as adjusted for non-recurring items. These non-GAAP financial measures provide information for investors to effectively analyze financial trends of on-going business activities, and to enhance comparability with peers across the financial services sector.

Randolph Bancorp, Inc.
Consolidated Balance Sheet
(Dollars in thousands)
(Unaudited)

              % Change 
  March 31,  December 31,  March 31,  Mar 2021 vs.  Mar 2021 vs. 
  2021  2020  2020  Dec 2020  Mar 2020 
Assets                    
Cash and cash equivalents $54,950  $13,774  $21,245   298.9%  158.6%
Certificates of deposit  -   -   490  - %   (100.0)%
Securities available for sale, at fair value  54,148   55,366   55,465   (2.2)%  (2.4)%
Loans held for sale, at fair value  93,176   119,112   58,781   (21.8)%  58.5%
Loans:                    
1-4 family residential  239,190   235,648   250,006   1.5%  (4.3)%
Home equity  49,073   48,166   43,503   1.9%  12.8%
Commercial real estate  146,930   143,893   126,608   2.1%  16.1%
Construction  29,975   31,050   35,327   (3.5)%  (15.1)%
Total real estate loans  465,168   458,757   455,444   1.4%  2.1%
Commercial and industrial  23,869   20,259   9,030   17.8%  164.3%
Consumer  8,724   10,289   15,344   (15.2)%  (43.1)%
Total loans  497,761   489,305   479,818   1.7%  3.7%
Allowance for loan losses  (6,563)  (6,784)  (4,996)  (3.3)%  31.4%
Net deferred loan costs and fees, and purchase premiums  785   1,123   1,404   (30.1)%  (44.1)%
Loans, net  491,983   483,644   476,226   1.7%  3.3%
Federal Home Loan Bank of Boston stock, at cost  3,576   3,576   2,873   0.0%  24.5%
Accrued interest receivable  1,501   1,562   1,397   (3.9)%  7.4%
Mortgage servicing rights, net  14,744   12,377   7,488   19.1%  96.9%
Premises and equipment, net  4,709   4,781   5,667   (1.5)%  (16.9)%
Bank-owned life insurance  8,662   8,622   8,486   0.5%  2.1%
Foreclosed real estate, net  132   132   132   0.0%  0.0%
Other assets  10,607   18,126   14,636   (41.5)%  (27.5)%
Total assets $738,188  $721,072  $652,886   2.4%  13.1%
                     
Liabilities and Stockholders' Equity                    
Deposits:                    
Non-interest bearing $118,623  $96,731  $65,017   22.6%  82.4%
Savings accounts  192,712   185,481   144,980   3.9%  32.9%
NOW accounts  62,772   53,530   39,598   17.3%  58.5%
Money market accounts  78,236   77,393   67,220   1.1%  16.4%
Term certificates  75,690   83,444   102,253   (9.3)%  (26.0)%
Brokered  32,225   31,728   85,951   1.6%  (62.5)%
Total deposits  560,258   528,307   505,019   6.0%  10.9%
Federal Reserve Bank advances  -   11,431   -   (100.0)% - % 
Federal Home Loan Bank of Boston advances  60,024   61,895   52,013   (3.0)%  15.4%
Mortgagors' escrow accounts  1,924   2,338   2,074   (17.7)%  (7.2)%
Post-employment benefit obligations  2,235   2,382   2,329   (6.2)%  (4.0)%
Other liabilities  12,888   14,900   12,495   (13.5)%  3.1%
Total liabilities  637,329   621,253   573,930   2.6%  11.0%
Stockholders' Equity:                    
Common stock  53   54   55   (1.9)%  (3.6)%
Additional paid-in capital  48,613   50,937   50,832   (4.6)%  (4.4)%
Retained earnings  55,801   51,689   30,939   8.0%  80.4%
ESOP-Unearned compensation  (3,709)  (3,756)  (3,897)  (1.3)%  (4.8)%
Accumulated other comprehensive income, net of tax  101   895   1,027   (88.7)%  (90.2)%
Total stockholders' equity  100,859   99,819   78,956   1.0%  27.7%
Total liabilities and stockholders' equity $738,188  $721,072  $652,886   2.4%  13.1%

Randolph Bancorp, Inc.
Consolidated Balance Sheet Trend
(Dollars in thousands)
(Unaudited)

  March 31,  December 31,  September 30,  June 30,  March 31, 
   2021   2020   2020   2020   2020 
Assets                    
Cash and cash equivalents $54,950  $13,774  $49,091  $76,003  $21,245 
Certificates of deposit  -   -   -   490   490 
Securities available for sale, at fair value  54,148   55,366   55,551   54,462   55,465 
Loans held for sale, at fair value  93,176   119,112   87,805   61,673   58,781 
Loans:                    
1-4 family residential  239,190   235,648   235,955   246,236   250,006 
Home equity  49,073   48,166   48,097   43,493   43,503 
Commercial real estate  146,930   143,893   141,862   134,750   126,608 
Construction  29,975   31,050   32,064   35,181   35,327 
Total real estate loans  465,168   458,757   457,978   459,660   455,444 
Commercial and industrial  23,869   20,259   20,388   22,940   9,030 
Consumer  8,724   10,289   11,696   13,435   15,344 
Total loans  497,761   489,305   490,062   496,035   479,818 
Allowance for loan losses  (6,563)  (6,784)  (6,597)  (6,059)  (4,996)
Net deferred loan costs and fees, and purchase premiums  785   1,123   1,083   962   1,404 
Loans, net  491,983   483,644   484,548   490,938   476,226 
Federal Home Loan Bank of Boston stock, at cost  3,576   3,576   3,797   4,072   2,873 
Accrued interest receivable  1,501   1,562   1,654   1,760   1,397 
Mortgage servicing rights, net  14,744   12,377   10,944   8,094   7,488 
Premises and equipment, net  4,709   4,781   5,133   5,313   5,667 
Bank-owned life insurance  8,662   8,622   8,577   8,532   8,486 
Foreclosed real estate, net  132   132   132   132   132 
Other assets  10,607   18,126   15,736   12,572   14,636 
Total assets $738,188  $721,072  $722,968  $724,041  $652,886 
                     
Liabilities and Stockholders' Equity                    
Deposits:                    
Non-interest bearing $118,623  $96,731  $93,352  $89,014  $65,017 
Savings accounts  192,712   185,481   175,316   165,234   144,980 
NOW accounts  62,772   53,530   47,032   48,014   39,598 
Money market accounts  78,236   77,393   74,874   75,827   67,220 
Term certificates  75,690   83,444   94,438   104,905   102,253 
Brokered  32,225   31,728   37,273   55,972   85,951 
Total deposits  560,258   528,307   522,285   538,966   505,019 
Federal Reserve Bank advances  -   11,431   15,318   15,010   - 
Federal Home Loan Bank of Boston advances  60,024   61,895   66,903   71,944   52,013 
Mortgagors' escrow accounts  1,924   2,338   1,959   1,824   2,074 
Post-employment benefit obligations  2,235   2,382   2,289   2,319   2,329 
Other liabilities  12,888   14,900   19,276   9,449   12,495 
Total liabilities  637,329   621,253   628,030   639,512   573,930 
Stockholders' Equity:                    
Common stock  53   54   55   55   55 
Additional paid-in capital  48,613   50,937   51,201   51,013   50,832 
Retained earnings  55,801   51,689   46,415   36,130   30,939 
ESOP-Unearned compensation  (3,709)  (3,756)  (3,803)  (3,850)  (3,897)
Accumulated other comprehensive income, net of tax  101   895   1,070   1,181   1,027 
Total stockholders' equity  100,859   99,819   94,938   84,529   78,956 
Total liabilities and stockholders' equity $738,188  $721,072  $722,968  $724,041  $652,886 

Randolph Bancorp, Inc.
Consolidated Statements of Operations
(Dollars in thousands except per share amounts)
(Unaudited)

  Three Months Ended  % Change 
  March 31,  December 31,  March 31,  Mar 2021 vs.  Mar 2021 vs. 
  2021  2020  2020  Dec 2020  Mar 2020 
Interest and dividend income:                    
Loans $5,508  $5,532  $5,620   (0.4)%  (2.0)%
Other interest and dividend income  253   296   433   (14.5)%  (41.6)%
Total interest and dividend income  5,761   5,828   6,053   (1.1)%  (4.8)%
                     
Interest expense  670   788   1,628   (15.0)%  (58.8)%
                     
Net interest income  5,091   5,040   4,425   1.0%  15.1%
Provision (credit) for loan losses  (213)  215   724   (199.1)%  (129.4)%
Net interest income after provision (credit) for loan losses  5,304   4,825   3,701   9.9%  43.3%
                     
Non-interest income:                    
Customer service fees  367   381   306   (3.7)%  19.9%
Gain on loan origination and sale activities, net  10,993   14,620   7,144   (24.8)%  53.9%
Mortgage servicing fees, net  779   275   (1,254)  183.3%  (162.1)%
Other  284   311   255   (8.7)%  11.4%
Total non-interest income  12,423   15,587   6,451   (20.3)%  92.6%
Non-interest expenses:                    
Salaries and employee benefits  8,437   8,722   8,126   (3.3)%  3.8%
Occupancy and equipment  744   1,150   698   (35.3)%  6.6%
Professional fees  561   389   405   44.2%  38.5%
Marketing  170   231   152   (26.4)%  11.8%
FDIC insurance  54   51   56   5.9%  (3.6)%
Other non-interest expenses  1,985   2,384   1,522   (16.7)%  30.4%
Total non-interest expenses  11,951   12,927   10,959   (7.6)%  9.1%
Income (loss) before income taxes  5,776   7,485   (807)  (22.8)%  (815.7)%
Income tax expense  1,664   2,211   11   (24.7)%  15027.3%
Net income (loss) $4,112  $5,274  $(818)  (22.0)%  (602.7)%
                     
Net income (loss) per share:                    
Basic $0.81  $1.03  $(0.16)        
Diluted $0.78  $1.01  $(0.16)        
                     
Weighted average shares outstanding:                    
Basic  5,056,165   5,135,069   5,158,294         
Diluted  5,254,907   5,244,414   5,158,294         

Randolph Bancorp, Inc.
Consolidated Statements of Operations Trend
(Dollars in thousands except per share amounts)
(Unaudited)

  Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
  2021  2020  2020  2020  2020 
Interest and dividend income:                    
Loans $5,508  $5,532  $5,337  $5,723  $5,620 
Other interest and dividend income  253   296   311   336   433 
Total interest and dividend income  5,761   5,828   5,648   6,059   6,053 
                     
Interest expense  670   788   979   1,326   1,628 
                     
Net interest income  5,091   5,040   4,669   4,733   4,425 
Provision (credit) for loan losses  (213)  215   546   1,068   724 
Net interest income after provision (credit) for loan losses  5,304   4,825   4,123   3,665   3,701 
                     
Non-interest income:                    
Customer service fees  367   381   330   266   306 
Gain on loan origination and sale activities, net  10,993   14,620   18,102   14,370   7,144 
Mortgage servicing fees, net  779   275   1,180   (1,354)  (1,254)
Other  284   311   262   217   255 
Total non-interest income  12,423   15,587   19,874   13,499   6,451 
Non-interest expenses:                    
Salaries and employee benefits  8,437   8,722   7,911   8,402   8,126 
Occupancy and equipment  744   1,150   859   838   698 
Professional fees  561   389   253   230   405 
Marketing  170   231   154   152   152 
FDIC insurance  54   51   41   39   56 
Other non-interest expenses  1,985   2,384   1,833   1,718   1,522 
Total non-interest expenses  11,951   12,927   11,051   11,379   10,959 
Income (loss) before income taxes  5,776   7,485   12,946   5,785   (807)
Income tax expense  1,664   2,211   2,661   594   11 
Net income (loss) $4,112  $5,274  $10,285  $5,191  $(818)
                     
Net income (loss) per share:                    
Basic $0.81  $1.03  $2.01  $1.02  $(0.16)
Diluted $0.78  $1.01  $2.01  $1.02  $(0.16)
                     
Weighted average shares outstanding:                    
Basic  5,056,165   5,135,069   5,120,367   5,092,490   5,158,294 
Diluted  5,254,907   5,244,414   5,120,367   5,092,490   5,158,294 

Randolph Bancorp, Inc.
Average Balances/Yields
(Dollars in thousands)
(Unaudited)

 Three Months Ended 
 March 31, 2021  December 31, 2020  March 31, 2020 
 Average  Interest  Average  Average  Interest  Average  Average  Interest  Average 
 Outstanding  Earned/  Yield/  Outstanding  Earned/  Yield/  Outstanding  Earned/  Yield/ 
(Dollars in thousands)Balance  Paid  Rate  Balance  Paid  Rate  Balance  Paid  Rate 
Interest-earning assets:                                   
Loans (1)$594,021  $5,508   3.71% $580,002  $5,532   3.82% $531,141  $5,620   4.23%
Investment securities(2) (3) 57,818   247   1.71%  58,329   290   1.99%  58,799   379   2.58%
Interest-earning deposits 35,492   7   0.08%  30,573   8   0.10%  18,458   56   1.21%
Total interest-earning assets 687,331   5,762   3.35%  668,904   5,830   3.49%  608,398   6,055   3.98%
Noninterest-earning assets 42,045           45,015           31,774         
Total assets$729,376          $713,919          $640,172         
Interest-bearing liabilities:                                   
Savings accounts 190,313   98   0.21%  181,653   142   0.31%  134,843   284   0.84%
NOW accounts 69,511   48   0.28%  59,005   43   0.29%  39,049   51   0.52%
Money market accounts 75,994   54   0.28%  75,106   62   0.33%  78,394   197   1.01%
Term certificates 96,978   238   0.98%  112,260   293   1.04%  188,654   893   1.89%
Total interest-bearing deposits 432,796   438   0.40%  428,024   540   0.50%  440,940   1,425   1.29%
FHLBB and FRB advances 70,857   232   1.31%  77,584   247   1.27%  47,102   203   1.72%
Total interest-bearing liabilities 503,653   670   0.53%  505,608   787   0.62%  488,042   1,628   1.33%
Noninterest-bearing liabilities:                                   
Noninterest-bearing deposits 106,929           94,540           62,718         
Other noninterest-bearing liabilities 15,375           13,539           9,549         
Total liabilities 625,957           613,687           560,309         
Total stockholders' equity 103,419           100,232           79,863         
Total liabilities and stockholders' equity$729,376          $713,919          $640,172         
Net interest income    $5,092          $5,043          $4,427     
Interest rate spread(4)         2.82%          2.87%          2.65%
Net interest-earning assets(5)$183,678          $163,296          $120,356         
Net interest margin(6)         2.96%          3.02%          2.91%
                                    
Ratio of interest-earning assets to interest-bearing liabilities 136.47%          132.30%          124.66%        

(1) Includes nonaccruing loan balances and interest received on such loans.
(2) Includes carrying value of securities classified as available-for-sale and FHLBB stock.
(3) Includes tax equivalent adjustments for municipal securities, based on a statutory tax rate of 21%, of $1,000, $1,000 and $2,000 for the three months ended March 31, 2021, December 31, 2020 and March 31, 2020, respectively.
(4) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(6) Net interest margin represents net interest income divided by average total interest-earning assets.

Randolph Bancorp, Inc.
Average Balances Trend
(Dollars in thousands)
(Unaudited)

  Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
  2021  2020  2020  2020  2020 
Interest-earning assets:                    
Total loans $594,021  $580,002  $559,370  $576,964  $531,141 
Investment securities  57,818   58,329   57,211   58,119   58,799 
Interest-earning deposits  35,492   30,573   48,949   22,918   18,458 
Total interest-earning assets  687,331   668,904   665,530   658,001   608,398 
Non-interest earning assets  42,045   45,015   41,037   40,156   31,774 
Total assets $729,376  $713,919  $706,567  $698,157  $640,172 
                     
Interest-bearing liabilities:                    
Savings accounts $190,313  $181,653  $170,762  $158,427  $134,843 
NOW accounts  69,511   59,005   57,646   46,593   39,049 
Money market accounts  75,994   75,106   72,369   71,396   78,394 
Term certificates  96,978   112,260   131,053   159,224   188,654 
Total interest-bearing deposits  432,796   428,024   431,830   435,640   440,940 
FHLBB and FRB advances  70,857   77,584   82,639   79,133   47,102 
Total interest-bearing liabilities  503,653   505,608   514,469   514,773   488,042 
Noninterest-bearing liabilities:                    
Noninterest-bearing deposits  106,929   94,540   88,394   77,947   62,718 
Other noninterest-bearing liabilities  15,375   13,539   12,724   22,893   9,549 
Total liabilities  625,957   613,687   615,587   615,613   560,309 
Total stockholders' equity  103,419   100,232   90,980   82,544   79,863 
Total liabilities and stockholders' equity $729,376  $713,919  $706,567  $698,157  $640,172 

Randolph Bancorp, Inc.
Average Balances Trend
(Dollars in thousands)
(Unaudited)

  Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
  2021  2020  2020  2020  2020 
Interest-earning assets:                    
Total loans  3.71%  3.82%  3.82%  3.97%  4.23%
Investment securities  1.71%  1.99%  2.13%  2.28%  2.58%
Interest-earning deposits  0.08%  0.10%  0.06%  0.09%  1.21%
Total interest-earning assets  3.35%  3.49%  3.40%  3.68%  3.98%
                     
Interest-bearing liabilities:                    
Savings accounts  0.21%  0.31%  0.40%  0.59%  0.84%
NOW accounts  0.28%  0.29%  0.28%  0.43%  0.52%
Money market accounts  0.28%  0.33%  0.41%  0.68%  1.01%
Term certificates  0.98%  1.04%  1.35%  1.70%  1.89%
Total interest-bearing deposits  0.40%  0.50%  0.68%  0.99%  1.29%
FHLBB and FRB advances  1.31%  1.27%  1.21%  1.23%  1.72%
Total interest-bearing liabilities  0.53%  0.62%  0.76%  1.03%  1.33%
                     
Interest rate spread  2.82%  2.87%  2.64%  2.65%  2.65%
Net interest rate margin  2.96%  3.02%  2.81%  2.88%  2.91%
Ratio of interest-earning assets to interest-bearing liabilities  136.47%  132.30%  129.36%  127.82%  124.66%

Randolph Bancorp, Inc.
Rate/Volume Analysis
(Dollars in thousands)
(Unaudited)

  Three Months Ended 
  March 31, 2021 vs. December 31, 2020 
  Increase (Decrease)  Total 
  Due to Changes in  Increase 
  Volume  Rate  (Decrease) 
Interest-earning assets:            
Loans $135  $(159) $(24)
Investment securities  (3)  (40)  (43)
Interest-earning deposits  1   (1)  - 
Total interest-earning assets  133   (200)  (67)
Interest-bearing liabilities:            
Savings accounts  6   (50)  (44)
NOW accounts  7   (2)  5 
Money market accounts  1   (9)  (8)
Term certificates  (39)  (16)  (55)
Total interest-bearing deposits  (25)  (77)  (102)
FHLBB and FRB advances  (22)  6   (16)
Total interest-bearing liabilities  (47)  (71)  (118)
Change in net interest income $180  $(129) $51 


  Three Months Ended 
  March 31, 2021 vs. 2020 
  Increase (Decrease)  Total 
  Due to Changes in  Increase 
  Volume  Rate  (Decrease) 
Interest-earning assets:            
Loans $623  $(735) $(112)
Investment securities  (6)  (126)  (132)
Interest-earning deposits  27   (75)  (48)
Total interest-earning assets  644   (936)  (292)
Interest-bearing liabilities:            
Savings accounts  85   (271)  (186)
NOW accounts  28   (31)  (3)
Money market accounts  (6)  (137)  (143)
Term certificates  (329)  (326)  (655)
Total interest-bearing deposits  (222)  (765)  (987)
FHLBB and FRB advances  85   (56)  29 
Total interest-bearing liabilities  (137)  (821)  (958)
Change in net interest income $781  $(115) $666 

Randolph Bancorp, Inc.
Segment Information
(Dollars in thousands)
(Unaudited)

  For the Three Months Ended March 31, 2021 
  Envision Bank  Envision Mortgage  Consolidated Total 
Net interest income $4,201  $890  $5,091 
Provision (credit) for loan losses  (213)  -   (213)
Net interest income after provision for loan losses  4,414   890   5,304 
             
Non-interest income:            
Customer service fees  340   27   367 
Gain on loan origination and sale activities, net (1)  -   11,674   11,674 
Mortgage servicing fees, net  (94)  873   779 
Other  151   133   284 
Total non-interest income  397   12,707   13,104 
             
Non-interest expenses:            
Salaries and employee benefits  1,802   6,635   8,437 
Occupancy and equipment  443   301   744 
Other non-interest expenses  1,087   1,683   2,770 
Total non-interest expenses  3,332   8,619   11,951 
             
Income before income taxes and elimination of inter-segment profit $1,479  $4,978   6,457 
             
Elimination of inter-segment profit          (681)
Income before income taxes          5,776 
             
Income tax expense          1,664 
Net income         $4,112 

(1) Before elimination of inter-segment profit.

The information above was derived from the internal management reporting system used to measure performance of the segments.

Randolph Bancorp, Inc.
Segment Information
(Dollars in thousands)
(Unaudited)

  For the Three Months Ended December 31, 2020 
  Envision Bank  Envision Mortgage  Consolidated Total 
Net interest income $4,265  $775  $5,040 
Provision for loan losses  215   -   215 
Net interest income after provision for loan losses  4,050   775   4,825 
             
Non-interest income:            
Customer service fees  353   28   381 
Gain on loan origination and sale activities, net (1)  -   15,062   15,062 
Mortgage servicing fees, net  (100)  375   275 
Other  147   164   311 
Total non-interest income  400   15,629   16,029 
             
Non-interest expenses:            
Salaries and employee benefits  2,178   6,544   8,722 
Occupancy and equipment  465   685   1,150 
Other non-interest expenses  1,942   1,113   3,055 
Total non-interest expenses  4,585   8,342   12,927 
             
Income (loss) before income taxes and elimination of inter-segment profit $(135) $8,062   7,927 
             
Elimination of inter-segment profit          (442)
Income before income taxes          7,485 
             
Income tax expense          2,211 
Net income         $5,274 

(1) Before elimination of inter-segment profit.

Randolph Bancorp, Inc.
Segment Information
(Dollars in thousands)
(Unaudited)

  For the Three Months Ended March 31, 2020 
  Envision Bank  Envision Mortgage  Consolidated Total 
Net interest income $3,994  $431  $4,425 
Provision for loan losses  724   -   724 
Net interest income after credit for loan losses  3,270   431   3,701 
             
Non-interest income:            
Customer service fees  273   33   306 
Gain on loan origination and sale activities, net (1)  -   7,472   7,472 
Mortgage servicing fees, net  (87)  (1,167)  (1,254)
Other  140   115   255 
Total non-interest income  326   6,453   6,779 
             
Non-interest expenses:            
Salaries and employee benefits  3,098   5,028   8,126 
Occupancy and equipment  404   294   698 
Other non-interest expenses  1,145   990   2,135 
Total non-interest expenses  4,647   6,312   10,959 
             
Income (loss) before income taxes and elimination of inter-segment profit $(1,051) $572   (479)
             
Elimination of inter-segment profit          (328)
Loss before income taxes          (807)
             
Income tax expense          11 
Net loss         $(818)

(1) Before elimination of inter-segment profit.

The information above was derived from the internal management reporting system used to measure performance of the segments.

Randolph Bancorp, Inc.
Reconciliation of GAAP to Non-GAAP Net Income
(in thousands)
(Unaudited)

  Quarter Ended 
  March 31, 2021 
  Income Before Taxes  Provision for Income Taxes  Net Income  Earnings per Common Share (diluted) 
GAAP basis $5,776  $1,664  $4,112  $0.78 
Non-interest expense adjustments:                
Accrued severance expenses  109   31   78   0.01 
Non-GAAP basis $5,885  $1,695  $4,190  $0.79 
                 
  Quarter Ended 
  December 31, 2020 
  Income Before Taxes  Provision for Income Taxes  Net Income  Earnings per Common Share (diluted) 
GAAP basis $7,485  $2,211  $5,274  $1.01 
Non-interest expense adjustments:                
Residential lending office closure  294   63   231   0.04 
COVID-19 related expenses  69   15   54   0.01 
Non-GAAP basis $7,848  $2,289  $5,559  $1.06 
                 
  Quarter Ended 
  September 30, 2020 
  Income Before Taxes  Provision for Income Taxes  Net Income  Earnings per Common Share (diluted) 
GAAP basis $12,946  $2,661  $10,285  $2.01 
Non-interest expense adjustments:                
COVID-19 related expenses  22   4   18   - 
Non-GAAP basis $12,968  $2,665  $10,303  $2.01 
                 
  Quarter Ended 
  June 30, 2020 
  Income Before Taxes  Provision for Income Taxes  Net Income  Earnings per Common Share (diluted) 
GAAP basis $5,785  $594  $5,191  $1.02 
Non-interest expense adjustments:                
COVID-19 related expenses  189   -   189   0.04 
Non-GAAP basis $5,974  $594  $5,380  $1.06 
                 
  Quarter Ended 
  March 31, 2020 
  Income (Loss) Before Taxes  Provision for Income Taxes  Net Income (Loss)  Earnings (Loss) per Common Share (diluted) 
GAAP basis $(807) $11  $(818) $(0.16)
Non-interest expense adjustments:                
Retirement salary and benefits compensation  692  $-   692   0.13 
Accelerated vesting of stock-based compensation  683  $-   683   0.13 
COVID-19 related expenses  18  $-   18   - 
Non-GAAP basis $586  $11  $575  $0.10 

Randolph Bancorp, Inc.
Selected Financial Highlights
(Unaudited)

  At or for the Three Months Ended 
  March 31,  December 31,  September 30,  June 30,  March 31, 
  2021  2020  2020  2020  2020 
Return on average assets: (1, 5)                    
GAAP  2.26%  2.95%  5.82%  2.97%  (0.51%)
Non-GAAP (2)  2.30%  3.11%  5.83%  3.08%  0.36%
                     
Return on average equity: (1, 6)                    
GAAP  15.90%  21.05%  45.22%  25.16%  (4.10%)
Non-GAAP (2)  16.21%  22.18%  45.30%  26.07%  2.88%
                     
Net interest margin  2.96%  3.02%  2.81%  2.88%  2.91%
                     
Non-interest income to total income:                    
GAAP  70.93%  75.57%  80.98%  74.04%  59.31%
                     
Profit percentage (9)                    
GAAP  31.76%  37.33%  54.97%  37.59%  (0.76%)
Non-GAAP (2)  32.39%  39.09%  55.06%  38.62%  12.04%
                     
Efficiency ratio: (7)                    
GAAP  68.24%  62.67%  45.03%  62.41%  100.76%
Non-GAAP (2)  67.61%  60.91%  44.94%  61.38%  87.96%
                     
Tier 1 capital to average assets (3)  13.81%  13.85%  13.28%  11.93%  12.17%
                     
Non-performing assets as a percentage of total assets (4)  1.14%  1.01%  1.38%  0.47%  0.52%
                     
Allowance for loan losses as a percentage of total loans (4)  1.32%  1.39%  1.35%  1.22%  1.04%
Allowance for loan losses as a percentage of total loans, excluding SBA PPP Loans (4)  1.36%  1.41%  1.39%  1.26%  1.04%
                     
Allowance for loan losses as a percentage of non-performing assets  78.99%  94.58%  67.21%  179.31%  146.64%
Allowance for loan losses as a percentage of non-performing loans  77.75%  92.87%  66.31%  186.60%  152.55%
                     
Tangible book value per share (8) $18.80  $18.16  $17.18  $15.43  $14.44 
Outstanding shares  5,364,240   5,495,514   5,524,390   5,479,884   5,466,344 

(1) Annualized for quarterly periods presented.
(2) See page 16 – Reconciliation of GAAP to Non-GAAP Net Income.
(3) Average assets calculated on a quarterly basis for all periods presented.
(4) Total loans exclude loans held for sale but includes net deferred loan costs and fees.
(5) This non-GAAP measure represents net income divided by average total assets.
(6) This non-GAAP measure represents net income divided by average stockholders’ equity.
(7) This non-GAAP measure represents total non-interest expenses divided by net interest income and non-interest income.
(8) This non-GAAP measure represents total stockholders’ equity, minus intangible assets of $31,000, $33,000, $36,000, $38,000, and $41,000 at March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020, and March 31, 2020, respectively, divided by outstanding shares at period end.
(9) This non-GAAP measure represents net interest income plus noninterest income less non-interest expense divided by net interest income plus non-interest income.

Randolph Bancorp, Inc.
COVID-19 Supplemental Disclosure
(Unaudited)

Loan Payment Deferrals

  As of March 31, 2021 
  Commercial loans  Residential and consumer loans  Residential loans serviced for others 
          
  (Dollars in thousands) 
Balance outstanding $182,277  $315,485  $1,940,443 
             
COVID-19 related loan payment deferrals: (1)            
Loans in COVID-19-related loan payment deferral $6,241  $4,777  $11,544 
Loans in deferral as a percentage of category loans  3.4%  1.5%  0.6%
Loans with suspended payment $6,241  $4,543  $4,657 
Loans with reduced payment  -   234   6,887 
             
Loans which obtained a COVID-19-related payment deferral but            
have since resumed payment $31,954  $15,602  $54,450 
Loans reinstated (borrower paid any unpaid principal and interest)  -   2,253   6,353 
Loans on a repayment plan  -   -   1,354 
Loans which resumed payment but deferred principal and/or            
interest payments to maturity (2)  26,197   8,713   36,811 
Loans which were paid off completely  5,757   4,636   9,932 

(1) Includes commercial loans that have been approved for loan payment deferral but for which documentation is closing or pending.
(2) Includes commercial loan for which maturity was extended.

Randolph Bancorp, Inc.
COVID-19 Supplemental Disclosure
(Unaudited)

COVID-19 Highly Impacted Sectors

  As of March 31, 2021 
  Exposure Balance  Exposure by Risk Weighting     
                          Balance 
      Real  Commercial              with 
      Estate  &              Deferred 
Industry (1) Total  Secured  Industrial  Construction  Pass  Criticized  Payments 
                      
  (Dollars in thousands) 
Group home/care facility $1,079   $1,079   $-   $-   $1,079  $-  $- 
Hotels/hospitality  9,635    9,566    69    -    69   9,566   3,543 
Restaurants/food service  2,713    1,554    1,159    -    2,713   -   - 
Retail/shopping center  21,887    17,211    -    4,675    20,261   1,626   1,006 
Other sectors (2)  11,385    10,972    113    300    9,383   2,002   1,692 
Total loans in COVID-19 impacted sectors $46,698   $40,382   $1,341   $4,975   $33,505  $13,194  $6,241 
Percentage of commercial loans outstanding 25.6%  27.5%  5.6%  43.3%             
Commercial loans outstanding $182,277   $146,930   $23,869   $11,478              
Loan to value secured by real estate (3)     47.5%      66.9%             

(1) This disclosure focuses on industries with balances that are significant to the portfolio at March 31, 2021 and omits industries affected by the COVID-19 pandemic (oil and gas, transportation, etc.) to which the Company has minimal or no exposure. This disclosure also excludes SBA PPP Loans, given their government guarantee.
(2) Includes customers operating in various sectors which have been impacted by COVID-19.
(3) Loan to value secured by real estate equals the exposure balance divided by the most recent appraised value.

For More Information, Contact:
William M. Parent, President and Chief
Executive Officer (617-925-1955)