Randolph Bancorp, Inc. Announces Second Quarter 2021 Financial Results

Quincy, Massachusetts, UNITED STATES


QUINCY, Mass., July 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 $1.6 million, or $0.32 per basic share and $0.31 per diluted share, for the three months ended June 30, 2021 compared to net income of $4.1 million, or $0.81 per basic and $0.78 per diluted share, for the three months ended March 31, 2021 and net income of $5.2 million, or $1.02 per basic and diluted share, for the three months ended June 30, 2020. Excluding one-time events of $145,000 in severance expenses, $71,000 in other outsourcing expenses, and $29,000 in losses on disposals of fixed assets, earnings were $1.8 million, or $0.34 per diluted share, for the three months ended June 30, 2021. 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 $189,000 of operating expenses related to addressing the COVID-19 pandemic, net income for the three months ended June 30, 2020 was $5.4 million, or $1.06 per diluted share.

For the six months ended June 30, 2021, net income was $5.7 million, or $1.10 per diluted share, compared to net income of $4.4 million, or $0.86 per diluted share, for the six months ended June 30, 2020. Net income on a non-GAAP basis, excluding certain nonrecurring items, was $5.9 million, or $1.15 per diluted share, for the six months ended June 30, 2021, compared to net income on a non-GAAP basis, excluding other certain nonrecurring items, of $6.0 million, or $1.17 per diluted share, for the six months ended June 30, 2020.

At June 30, 2021, total assets amounted to $744.1 million, compared to $738.2 million at March 31, 2021, an increase of $6.0 million, or 0.8%. Total loans increased by $48.6 million, or 9.8%, to $546.4 million at June 30, 2021 from $497.8 million at March 31, 2021, whereas loans held for sale decreased by $18.9 million to $74.3 million at June 30, 2021 from $93.2 million at March 31, 2021. Compared to June 30, 2020, total assets grew $20.1 million, or 2.8% from $724.0 million. The growth from the prior year period was driven by an increase in total loans of $50.4 million, or 10.2%, and an increase in loans held for sale of $12.6 million, partially offset by a decrease in cash and cash equivalents of $41.1 million.

William M. Parent, President and Chief Executive Officer, stated, “The second quarter was a positive quarter for our Company as we continued to see progress along our operating path. Strong loan growth, higher net interest margin, net interest income growth and improved credit metrics all reflect building momentum. The earnings decline from prior quarters reflects the normalization of the mortgage market as declining refinancing volume and compressed margins resulted in significantly lower overall originations and related income. We continue to work diligently to right size our operations to reflect market conditions but there will be a lagging period before our overall operating leverage initiatives are realized. We are pleased with the developments post re-opening of our local market and remain optimistic that we can continue to grow our business and generate recurring operating leverage.”

Second Quarter Operating Results
Net interest income increased by $108,000, or 2.1%, to $5.2 million for the three months ended June 30, 2021 from $5.1 million for the three months ended March 31, 2021. This increase was primarily due to a decrease in the cost of term certificates and a decrease in the volume of Federal Home Loan Bank of Boston (“FHLBB”) advances from the prior quarter. The average cost of certificates of deposit decreased by 31 basis points from the prior quarter, and the average balance of FHLBB advances decreased $19.4 million, or 27.3%, from the prior quarter. This contributed to a decrease of 9 basis points in the cost of interest-bearing liabilities in the second quarter of 2021. The improvement in the cost of funding was partially offset by a decrease in the average yield earned on interest-earning assets of 3 basis points, driven by declines in the volume of and yield on investment securities. Accordingly, the net interest margin increased by 4 basis points, to 3.00% in the second quarter from 2.96% in the first quarter.

Net interest income increased by $466,000, or 9.8%, to $5.2 million for the three months ended June 30, 2021 from $4.7 million in the same period in the prior year. Relative to the prior year quarter, the net interest margin increased by 12 basis points to 3.00%, from 2.88%. The improvement reflects the shortening and downward pricing of deposit liabilities, which exceeded the decrease in rates earned on interest-earning assets in the lower interest rate environment. The cost of interest-bearing liabilities decreased by 59 basis points, whereas the yield on interest-earning assets declined by 36 basis points between periods.

The Company recognized a credit for loan losses of $27,000 for the quarter ended June 30, 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, along with improvements in credit quality trends, which were partially offset by total loan growth of $48.6 million from the prior quarter. The allowance for loan losses was 1.19%, 1.32% and 1.22% of total loans at June 30, 2021, March 31, 2021 and June 30, 2020, respectively, and was 101.9%, 79.0% and 179.3% of non-performing assets at June 30, 2021, March 31, 2021 and June 30, 2020, respectively.

Non-interest income decreased $5.6 million, or 45.1%, to $6.8 million for the quarter ended June 30, 2021 from $12.4 million in the quarter ended March 31, 2021, due to a decrease of $5.3 million in the net gain on loan origination and sale activities, in addition to a decrease in net mortgage servicing fees of $398,000. Sold mortgages totaled $342.8 million in the second quarter of 2021, compared to $503.3 million in the first quarter of 2021. The second quarter of 2021 ended with a mortgage pipeline of $139.7 million, compared to a pipeline of $239.5 million at the end of the first quarter of 2021, contributing to the decrease in the net gain on loan origination and sales activities. Mortgage servicing fees decreased $398,000, or 51.1%, to $381,000 for the second quarter of 2021 from $779,000 in the first quarter of 2021 due to a positive fair value adjustment of $421,000 in the first quarter of 2021, based on an increase in mortgage interest rates from the end of 2020, and an impairment charge of $65,000 taken in the second quarter of 2021, as mortgage interest rates declined slightly from the prior quarter.

Non-interest income decreased $6.7 million, or 49.5%, to $6.8 million for the quarter ended June 30, 2021 from $13.5 million for the quarter ended June 30, 2020, principally due to a decrease of $8.6 million in the net gain on loan origination and sale activities, partially offset by an increase of $1.7 million in net mortgage servicing fees. Sold mortgage loans totaled $342.8 million in the second quarter of 2021, compared to sold mortgage loans of $442.9 million during the second quarter of 2020. The second quarter of 2021 ended with a mortgage pipeline of $139.7 million, compared to a pipeline of $329.3 million at the end of the second quarter of 2020. Mortgage servicing fees increased $1.7 million in the quarter ended June 30, 2021, principally due to an impairment of mortgage servicing rights of $1.5 million in the quarter ended June 30, 2020.

Non-interest expenses decreased $1.3 million, or 11.1%, to $10.6 million in the quarter ended June 30, 2021 from $12.0 million in the quarter ended March 31, 2021. The decrease was due to a decrease in salaries and employee benefits expense of $1.1 million, or 13.4%, primarily driven by lower commissions paid on mortgage originations and a decrease in professional fees of $238,000 or 42.4% from the prior quarter. Occupancy and equipment expenses decreased $123,000 in the quarter ended June 30, 2021 from the prior quarter due to the closing of residential lending offices.

Non-interest expenses decreased $752,000 to $10.6 million in the quarter ended June 30, 2021 from $11.4 million in the quarter ended June 30, 2020. The decrease is principally due to a decrease in salaries and employee benefits of $1.1 million, primarily attributed to lower commissions and incentives associated with a normalization of residential loan production, partially offset by a $401,000 increase in other non-interest expenses, which included an increase in the provision for unfunded commitments, driven by growth in unfunded commercial real estate and commercial construction commitments as of June 30, 2021.

The income tax benefit was $162,000 for the three months ended June 30, 2021 compared to income tax expense of $1.7 million and $594,000 for the three months ended March 31, 2021 and June 30, 2020, respectively. During the three months ended June 30, 2021, the Company reversed a valuation allowance on its charitable contribution carryforwards totaling $531,000. The remaining income tax expense for 2021 is expected to reflect an effective tax rate of 28.5%.

Year-to-Date Operating Results
Net interest income increased by $1.1 million, or 12.4%, for the six months ended June 30, 2021 compared to the same period in the prior year. 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. In addition, the composition of our deposit base improved as the average balance of savings and NOW accounts for the six months ended June 30, 2021 increased $44.7 million, or 30.5%, and $26.8 million, or 62.6%, respectively, from the six months ended June 30, 2020, while the average balance of our term certificates decreased $73.1 million, or 42.0%, from the prior year. The activity resulted in a 69 basis point decrease in the cost of interest-bearing liabilities.

The Company recognized a credit for loan losses of $240,000 for the six months ended June 30, 2021 compared to a provision of $1.8 million in the prior year period. At June 30, 2021, improvements to qualitative factors related to the impact of the COVID-19 pandemic, the economic outlook, and credit quality trends all helped to generate the credit for loan losses, partially offset by provisions for loan growth.

Non-interest income decreased $712,000, or 3.6%, to $19.2 million for the six months ended June 30, 2021 from $20.0 million in the six months ended June 30, 2020, principally due to a decrease of $4.8 million in the net gain on loan origination and sale activities. Mortgage loans sold were $846.0 million in the first half of 2021, compared to $657.9 million in the first half of 2020. Net gain on loan origination and sale activities decreased, while mortgage loans sold increased compared to the prior year quarter, as a result of both shrinking loan sale margins and the impact of a decreasing mortgage banking pipeline during the six months ended June 30, 2021 compared to an increasing mortgage banking pipeline during the six months ended June 30, 2020. Mortgage servicing fees increased $3.8 million in the first half of 2021 to $1.2 million from a loss of $2.6 million in the first half of 2020, due to positive fair value adjustments of $356,000 in the first half of 2021 and impairment charges of $3.1 million in the first half of 2020.

Non-interest expenses increased $240,000, or 1.1%, to $22.6 million for the six months ended June 30, 2021 from $22.3 million for the six months ended June 30, 2020. Non-interest expenses in the first half of 2020 included one-time charges of $1,375,000 related to the retirement of senior executives as well as $207,000 of COVID-19 pandemic-related expenses. Increases to non-interest expenses during the six months ended June 30, 2021 related to higher recurring salaries and benefits and other non-interest expenses related to increased mortgage loan production, professional fees associated with the outsourcing of the Company’s residential loan servicing functions, and an increase in the provision for unfunded commitments related to new commercial real estate and commercial construction commitments. Occupancy and equipment expenses decreased $172,000 in the first half of 2021 over the prior year period, partly as a result of decreased rental expenses due to the closures of residential lending offices, in addition to the absence of significant COVID-19 pandemic spending on cleaning and supplies.

Income tax expenses increased to $1.5 million for the six months ended June 30, 2021 from $605,000 for the six months ended June 30, 2020. The current period included a reversal of a charitable contribution carryforward valuation allowance, and the prior period included the utilization of net operating loss carryforwards.

Balance Sheet
At June 30, 2021, total assets amounted to $744.1 million, compared to $738.2 million at March 31, 2021, an increase of $6.0 million, or 0.8%. A $48.7 million increase in net loans from the prior quarter was partially offset by a $20.1 million decrease in cash and cash equivalents and an $18.9 million decrease in loans held for sale. Net loan growth of 9.9% was driven by 1-4 family residential real estate growth of $24.8 million and commercial real estate growth of $20.8 million. Deposits increased by $11.7 million in the quarter, including an increase of $6.1 million in non-interest bearing deposits. In addition, the Company reduced borrowings by $10 million in the quarter.

Total assets at June 30, 2021 increased $20.1 million, or 2.8% from $724.0 million at June 30, 2020. Contributing to asset growth was a $49.7 million increase in net loans to $540.7 million at June 30, 2021 from $490.9 million at June 30, 2020. Cash and cash equivalents decreased by $41.1 million, or 54.1%, to $34.9 million at June 30, 2021 from $76.0 million at June 30, 2020, mainly to fund growth in net loans as well as loans held for sale. Commercial real estate loans increased by $32.9 million, or 24.4%, as we focus on diversifying our loan mix. The increase in total assets from the prior year quarter was also funded by continued deposit growth. Retail deposits totaled $514.9 million at June 30, 2021, increasing by $31.9 million, or 6.6%, from $483.0 million at June 30, 2020. Driving the growth in retail deposits was customers’ receipt of government stimulus and our focus on deposit gathering. FHLBB advances decreased by $21.9 million to $50.0 million at June 30, 2021, from $71.9 million at June 30, 2020. Federal Reserve Bank advances decreased by $15.0 million between periods.

Total stockholders’ equity was $100.7 million at June 30, 2021 compared to $100.9 million at March 31, 2021. The decrease of $149,000 reflects share repurchases during the period of $2.2 million, partially offset by net income of $1.6 million and an increase in the fair value of available-for-sale securities, net of taxes, of $97,000.

Total stockholders’ equity was $100.7 million at June 30, 2021 compared to $84.5 million at June 30, 2020. The increase of $16.2 million relates mainly to net income from the previous twelve months of $21.2 million, partially offset by share repurchases of $5.4 million and a decrease in the fair value of available-for-sale securities, net of taxes, of $879,000.

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 Small Business Administration’s (“SBA’s”) Paycheck Protection Program (“PPP”), for which we funded $26.2 million of SBA PPP Loans through June 30, 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 Highly Impacted Sectors 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 Quincy, 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 the Company’s 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 PPP 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, non-interest income to total income 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 
 June 30,  March 31,  June 30,  Jun 2021 vs.  Jun 2021 vs. 
  2021   2021   2020  Mar 2021  Jun 2020 
Assets                  
Cash and cash equivalents$34,876  $54,950  $76,003  (36.5)%  (54.1)%
Certificates of deposit -   -   490  -%  (100.0)%
Securities available for sale, at fair value 50,212   54,148   54,462  (7.3)%  (7.8)%
Loans held for sale, at fair value 74,277   93,176   61,673  (20.3)%  20.4%
Loans:                  
1-4 family residential 263,992   239,190   246,236  10.4%  7.2%
Home equity 50,555   49,073   43,493  3.0%  16.2%
Commercial real estate 167,691   146,930   134,750  14.1%  24.4%
Construction 29,140   29,975   35,181  (2.8)%  (17.2)%
Total real estate loans 511,378   465,168   459,660  9.9%  11.3%
Commercial and industrial 25,826   23,869   22,940  8.2%  12.6%
Consumer 9,194   8,724   13,435  5.4%  (31.6)%
Total loans 546,398   497,761   496,035  9.8%  10.2%
Allowance for loan losses (6,523)  (6,563)  (6,059) (0.6)%  7.7%
Net deferred loan costs and fees, and purchase premiums 785   785   962  0.0%  (18.4)%
Loans, net 540,660   491,983   490,938  9.9%  10.1%
Federal Home Loan Bank of Boston stock, at cost 2,855   3,576   4,072  (20.2)%  (29.9)%
Accrued interest receivable 1,523   1,501   1,760  1.5%  (13.5)%
Mortgage servicing rights, net 15,375   14,744   8,094  4.3%  90.0%
Premises and equipment, net 5,115   4,709   5,313  8.6%  (3.7)%
Bank-owned life insurance 8,703   8,662   8,532  0.5%  2.0%
Foreclosed real estate, net -   132   132  (100.0)%  (100.0)%
Other assets 10,546   10,607   12,572  (0.6)%  (16.1)%
Total assets$744,142  $738,188  $724,041  0.8%  2.8%
                   
Liabilities and Stockholders' Equity                  
Deposits:                  
Non-interest bearing$124,683  $118,623  $89,014  5.1%  40.1%
Savings accounts 190,584   192,712   165,234  (1.1)%  15.3%
NOW accounts 51,059   62,772   48,014  (18.7)%  6.3%
Money market accounts 73,967   78,236   75,827  (5.5)%  (2.5)%
Term certificates 74,631   75,690   104,905  (1.4)%  (28.9)%
Interest bearing brokered 57,059   32,225   55,972  77.1%  1.9%
Total deposits 571,983   560,258   538,966  2.1%  6.1%
Federal Reserve Bank advances -   -   15,010  -%  (100.0)%
Federal Home Loan Bank of Boston advances 50,016   60,024   71,944  (16.7)%  (30.5)%
Mortgagors' escrow accounts 1,783   1,924   1,824  (7.3)%  (2.2)%
Post-employment benefit obligations 2,226   2,235   2,319  (0.4)%  (4.0)%
Other liabilities 17,424   12,888   9,449  35.2%  84.4%
Total liabilities 643,432   637,329   639,512  1.0%  0.6%
Stockholders' Equity:                  
Common stock 52   53   55  (1.9)%  (5.5)%
Additional paid-in capital 46,740   48,613   51,013  (3.9)%  (8.4)%
Retained earnings 57,378   55,801   36,130  2.8%  58.8%
ESOP-Unearned compensation (3,662)  (3,709)  (3,850) (1.3)%  (4.9)%
Accumulated other comprehensive income, net of tax 202   101   1,181  100.0%  (82.9)%
Total stockholders' equity 100,710   100,859   84,529  (0.1)%  19.1%
Total liabilities and stockholders' equity$744,142  $738,188  $724,041  0.8%  2.8%
                   

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

 June 30,  March 31,  December 31,  September 30,  June 30, 
  2021   2021   2020   2020   2020 
Assets                   
Cash and cash equivalents$34,876  $54,950  $13,774  $49,091  $76,003 
Certificates of deposit -   -   -   -   490 
Securities available for sale, at fair value 50,212   54,148   55,366   55,551   54,462 
Loans held for sale, at fair value 74,277   93,176   119,112   87,805   61,673 
Loans:                   
1-4 family residential 263,992   239,190   235,648   235,955   246,236 
Home equity 50,555   49,073   48,166   48,097   43,493 
Commercial real estate 167,691   146,930   143,893   141,862   134,750 
Construction 29,140   29,975   31,050   32,064   35,181 
Total real estate loans 511,378   465,168   458,757   457,978   459,660 
Commercial and industrial 25,826   23,869   20,259   20,388   22,940 
Consumer 9,194   8,724   10,289   11,696   13,435 
Total loans 546,398   497,761   489,305   490,062   496,035 
Allowance for loan losses (6,523)  (6,563)  (6,784)  (6,597)  (6,059)
Net deferred loan costs and fees, and purchase premiums 785   785   1,123   1,083   962 
Loans, net 540,660   491,983   483,644   484,548   490,938 
Federal Home Loan Bank of Boston stock, at cost 2,855   3,576   3,576   3,797   4,072 
Accrued interest receivable 1,523   1,501   1,562   1,654   1,760 
Mortgage servicing rights, net 15,375   14,744   12,377   10,944   8,094 
Premises and equipment, net 5,115   4,709   4,781   5,133   5,313 
Bank-owned life insurance 8,703   8,662   8,622   8,577   8,532 
Foreclosed real estate, net -   132   132   132   132 
Other assets 10,546   10,607   18,126   15,736   12,572 
Total assets$744,142  $738,188  $721,072  $722,968  $724,041 
                    
Liabilities and Stockholders' Equity                   
Deposits:                   
Non-interest bearing$124,683  $118,623  $96,731  $93,352  $89,014 
Savings accounts 190,584   192,712   185,481   175,316   165,234 
NOW accounts 51,059   62,772   53,530   47,032   48,014 
Money market accounts 73,967   78,236   77,393   74,874   75,827 
Term certificates 74,631   75,690   83,444   94,438   104,905 
Interest bearing brokered 57,059   32,225   31,728   37,273   55,972 
Total deposits 571,983   560,258   528,307   522,285   538,966 
Federal Reserve Bank advances -   -   11,431   15,318   15,010 
Federal Home Loan Bank of Boston advances 50,016   60,024   61,895   66,903   71,944 
Mortgagors' escrow accounts 1,783   1,924   2,338   1,959   1,824 
Post-employment benefit obligations 2,226   2,235   2,382   2,289   2,319 
Other liabilities 17,424   12,888   14,900   19,276   9,449 
Total liabilities 643,432   637,329   621,253   628,030   639,512 
Stockholders' Equity:                   
Common stock 52   53   54   55   55 
Additional paid-in capital 46,740   48,613   50,937   51,201   51,013 
Retained earnings 57,378   55,801   51,689   46,415   36,130 
ESOP-Unearned compensation (3,662)  (3,709)  (3,756)  (3,803)  (3,850)
Accumulated other comprehensive income, net of tax 202   101   895   1,070   1,181 
Total stockholders' equity 100,710   100,859   99,819   94,938   84,529 
Total liabilities and stockholders' equity$744,142  $738,188  $721,072  $722,968  $724,041 
                    

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

 Three Months Ended  % Change 
 June 30,  March 31,  June 30,  Jun 2021 vs.  Jun 2021 vs. 
 2021  2021  2020  Mar 2021  Jun 2020 
Interest and dividend income:                  
Loans$5,505  $5,508  $5,723  (0.1)%  (3.8)%
Other interest and dividend income 237   253   336  (6.3)%  (29.5)%
Total interest and dividend income 5,742   5,761   6,059  (0.3)%  (5.2)%
                   
Interest expense 543   670   1,326  (19.0)%  (59.0)%
                   
Net interest income 5,199   5,091   4,733  2.1%  9.8%
Provision (credit) for loan losses (27)  (213)  1,068  (87.3)%  (102.5)%
Net interest income after provision (credit) for loan losses 5,226   5,304   3,665  (1.5)%  42.6%
                   
Non-interest income:                  
Customer service fees 419   367   266  14.2%  57.5%
Gain on loan origination and sale activities, net 5,740   10,993   14,370  (47.8)%  (60.1)%
Mortgage servicing fees, net 381   779   (1,354) (51.1)%  (128.1)%
Other 276   284   217  (2.8)%  27.2%
Total non-interest income 6,816   12,423   13,499  (45.1)%  (49.5)%
Non-interest expenses:                  
Salaries and employee benefits 7,310   8,437   8,402  (13.4)%  (13.0)%
Occupancy and equipment 621   744   838  (16.5)%  (25.9)%
Professional fees 323   561   230  (42.4)%  40.4%
Marketing 200   170   152  17.6%  31.6%
FDIC insurance 54   54   39  0.0%  38.5%
Other non-interest expenses 2,119   1,985   1,718  6.8%  23.3%
Total non-interest expenses 10,627   11,951   11,379  (11.1)%  (6.6)%
Income before income taxes 1,415   5,776   5,785  (75.5)%  (75.5)%
Income tax expense (benefit) (162)  1,664   594  (109.7)%  (127.3)%
Net income$1,577  $4,112  $5,191  (61.6)%  (69.6)%
                   
Net income per share:                  
Basic$0.32  $0.81  $1.02        
Diluted$0.31  $0.78  $1.02        
                   
Weighted average shares outstanding:                  
Basic 4,921,182   5,056,165   5,092,490        
Diluted 5,135,582   5,254,907   5,092,490        
                   

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

 Year to Date  % Change 
 June 30,  June 30,  Jun 2021 vs. 
 2021  2020  Jun 2020 
Interest and dividend income:          
Loans$11,013  $11,343  (2.9)%
Other interest and dividend income 490   769  (36.3)%
Total interest and dividend income 11,503   12,112  (5.0)%
           
Interest expense 1,213   2,955  (59.0)%
           
Net interest income 10,290   9,157  12.4%
Provision (credit) for loan losses (240)  1,792  (113.4)%
Net interest income after provision (credit) for loan losses 10,530   7,365  43.0%
           
Non-interest income:          
Customer service fees 786   573  37.2%
Gain on loan origination and sale activities, net 16,733   21,514  (22.2)%
Mortgage servicing fees, net 1,160   (2,608) (144.5)%
Other 560   472  18.6%
Total non-interest income 19,239   19,951  (3.6)%
Non-interest expenses:          
Salaries and employee benefits 15,747   16,527  (4.7)%
Occupancy and equipment 1,365   1,537  (11.2)%
Professional fees 884   635  39.2%
Marketing 370   304  21.7%
FDIC insurance 108   96  12.5%
Other non-interest expenses 4,104   3,239  26.7%
Total non-interest expenses 22,578   22,338  1.1%
Income before income taxes 7,191   4,978  44.5%
Income tax expense 1,502   605  148.3%
Net income$5,689  $4,373  30.1%
           
Net income per share:          
Basic$1.14  $0.86    
Diluted$1.10  $0.86    
           
Weighted average shares outstanding:          
Basic 4,988,283   5,107,700    
Diluted 5,193,643   5,107,700    
           

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

 Three Months Ended 
 June 30,  March 31,  December 31,  September 30,  June 30, 
 2021  2021  2020  2020  2020 
Interest and dividend income:                   
Loans$5,505  $5,508  $5,532  $5,337  $5,723 
Other interest and dividend income 237   253   296   311   336 
Total interest and dividend income 5,742   5,761   5,828   5,648   6,059 
                    
Interest expense 543   670   788   979   1,326 
                    
Net interest income 5,199   5,091   5,040   4,669   4,733 
Provision (credit) for loan losses (27)  (213)  215   546   1,068 
Net interest income after provision (credit) for loan losses 5,226   5,304   4,825   4,123   3,665 
                    
Non-interest income:                   
Customer service fees 419   367   381   330   266 
Gain on loan origination and sale activities, net 5,740   10,993   14,620   18,102   14,370 
Mortgage servicing fees, net 381   779   275   1,180   (1,354)
Other 276   284   311   262   217 
Total non-interest income 6,816   12,423   15,587   19,874   13,499 
Non-interest expenses:                   
Salaries and employee benefits 7,310   8,437   8,722   7,911   8,402 
Occupancy and equipment 621   744   1,150   859   838 
Professional fees 323   561   389   253   230 
Marketing 200   170   231   154   152 
FDIC insurance 54   54   51   41   39 
Other non-interest expenses 2,119   1,985   2,384   1,833   1,718 
Total non-interest expenses 10,627   11,951   12,927   11,051   11,379 
Income before income taxes 1,415   5,776   7,485   12,946   5,785 
Income tax expense (benefit) (162)  1,664   2,211   2,661   594 
Net income$1,577  $4,112  $5,274  $10,285  $5,191 
                    
Net income per share:                   
Basic$0.32  $0.81  $1.03  $2.01  $1.02 
Diluted$0.31  $0.78  $1.01  $2.01  $1.02 
                    
Weighted average shares outstanding:                   
Basic 4,921,182   5,056,165   5,135,069   5,120,367   5,092,490 
Diluted 5,135,582   5,254,907   5,244,414   5,120,367   5,092,490 
                    

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

 Three Months Ended 
 June 30, 2021  March 31, 2021  June 30, 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)$592,750  $5,505 3.71% $594,021  $5,508 3.71% $576,964  $5,723 3.97%
Investment securities(2) (3) 55,376   229 1.65%  57,818   247 1.71%  58,119   332 2.28%
Interest-earning deposits 43,888   8 0.07%  35,492   7 0.08%  22,918   5 0.09%
Total interest-earning assets 692,014   5,742 3.32%  687,331   5,762 3.35%  658,001   6,060 3.68%
Noninterest-earning assets 40,257         42,045         40,156       
Total assets$732,271        $729,376        $698,157       
Interest-bearing liabilities:                             
Savings accounts 192,434   89 0.18%  190,313   98 0.21%  158,427   233 0.59%
NOW accounts 69,730   38 0.22%  69,511   48 0.28%  46,593   50 0.43%
Money market accounts 72,469   43 0.24%  75,994   54 0.28%  71,396   122 0.68%
Term certificates 104,604   176 0.67%  96,978   238 0.98%  159,224   677 1.70%
Total interest-bearing deposits 439,237   346 0.32%  432,796   438 0.40%  435,640   1,082 0.99%
FHLBB and FRB advances 51,502   198 1.54%  70,857   232 1.31%  79,133   244 1.23%
Total interest-bearing liabilities 490,739   544 0.44%  503,653   670 0.53%  514,773   1,326 1.03%
Noninterest-bearing liabilities:                             
Noninterest-bearing deposits 124,656         106,929         77,947       
Other noninterest-bearing liabilities 13,606         15,375         22,893       
Total liabilities 629,001         625,957         615,613       
Total stockholders' equity 103,270         103,419         82,544       
Total liabilities and stockholders' equity$732,271        $729,376        $698,157       
Net interest income    $5,198        $5,092        $4,734   
Interest rate spread(4)       2.88%        2.82%        2.65%
Net interest-earning assets(5)$201,275        $183,678        $143,228       
Net interest margin(6)       3.00%        2.96%        2.88%
                              
Ratio of interest-earning assets to interest-bearing liabilities 141.01%        136.47%        127.82%      

(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 $1,000 for the three months ended June, 2021, March 31, 2021 and June 30, 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/Yields
(Dollars in thousands)
(Unaudited)

 Average Balance and Yields 
 Year to Date 
 June 30, 2021  June 30, 2020 
 Average  Interest  Average  Average  Interest  Average 
 Outstanding  Earned/  Yield/  Outstanding  Earned/  Yield/ 
(Dollars in thousands)Balance  Paid  Rate  Balance  Paid  Rate 
Interest-earning assets:                     
Loans (1)$593,382  $11,013  3.71% $554,053  $11,343  4.09%
Investment securities(2) (3) 56,590   476  1.68%  58,459   711  2.43%
Interest-earning deposits 39,713   15  0.08%  20,688   61  0.59%
Total interest-earning assets 689,685   11,504  3.34%  633,200   12,115  3.83%
Noninterest-earning assets 41,146          35,965        
Total assets$730,831         $669,165        
Interest-bearing liabilities:                     
Savings accounts 191,379   187  0.20%  146,635   516  0.70%
NOW accounts 69,621   86  0.25%  42,821   101  0.47%
Money market accounts 74,222   97  0.26%  74,895   321  0.86%
Term certificates 100,812   414  0.82%  173,939   1,570  1.81%
Total interest-bearing deposits 436,034   784  0.36%  438,290   2,508  1.14%
FHLBB and FRB advances 61,126   430  1.41%  63,118   447  1.42%
Total interest-bearing liabilities 497,160   1,214  0.49%  501,408   2,955  1.18%
Noninterest-bearing liabilities:                     
Noninterest-bearing deposits 115,841          70,333        
Other noninterest-bearing liabilities 14,486          16,221        
Total liabilities 627,487          587,962        
Total stockholders' equity 103,344          81,204        
Total liabilities and stockholders' equity$730,831         $669,166        
Net interest income    $10,290         $9,160    
Interest rate spread(4)        2.85%         2.65%
Net interest-earning assets(5)$192,525         $131,792        
Net interest margin(6)        2.98%         2.89%
                      
Ratio of interest-earning assets to interest-bearing liabilities 138.72%         126.28%       

(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 $2,000 and $3,000 for the six months ended June 30, 2021 and 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
 June 30, March 31, December 31, September 30, June 30,
 2021 2021 2020 2020 2020
Interest-earning assets:              
Total loans$592,750 $594,021 $580,002 $559,370 $576,964
Investment securities 55,376  57,818  58,329  57,211  58,119
Interest-earning deposits 43,888  35,492  30,573  48,949  22,918
Total interest-earning assets 692,014  687,331  668,904  665,530  658,001
Non-interest earning assets 40,257  42,045  45,015  41,037  40,156
Total assets$732,271 $729,376 $713,919 $706,567 $698,157
               
Interest-bearing liabilities:              
Savings accounts$192,434 $190,313 $181,653 $170,762 $158,427
NOW accounts 69,730  69,511  59,005  57,646  46,593
Money market accounts 72,469  75,994  75,106  72,369  71,396
Term certificates 104,604  96,978  112,260  131,053  159,224
Total interest-bearing deposits 439,237  432,796  428,024  431,830  435,640
FHLBB and FRB advances 51,502  70,857  77,584  82,639  79,133
Total interest-bearing liabilities 490,739  503,653  505,608  514,469  514,773
Noninterest-bearing liabilities:              
Noninterest-bearing deposits 124,656  106,929  94,540  88,394  77,947
Other noninterest-bearing liabilities 13,606  15,375  13,539  12,724  22,893
Total liabilities 629,001  625,957  613,687  615,587  615,613
Total stockholders' equity 103,270  103,419  100,232  90,980  82,544
Total liabilities and stockholders' equity$732,271 $729,376 $713,919 $706,567 $698,157
               

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

 Three Months Ended 
 June 30,  March 31,  December 31,  September 30,  June 30, 
 2021  2021  2020  2020  2020 
Interest-earning assets:              
Total loans3.71% 3.71% 3.82% 3.82% 3.97%
Investment securities1.65% 1.71% 1.99% 2.13% 2.28%
Interest-earning deposits0.07% 0.08% 0.10% 0.06% 0.09%
Total interest-earning assets3.32% 3.35% 3.49% 3.40% 3.68%
               
Interest-bearing liabilities:              
Savings accounts0.18% 0.21% 0.31% 0.40% 0.59%
NOW accounts0.22% 0.28% 0.29% 0.28% 0.43%
Money market accounts0.24% 0.28% 0.33% 0.41% 0.68%
Term certificates0.67% 0.98% 1.04% 1.35% 1.70%
Total interest-bearing deposits0.32% 0.40% 0.50% 0.68% 0.99%
FHLBB and FRB advances1.54% 1.31% 1.27% 1.21% 1.23%
Total interest-bearing liabilities0.44% 0.53% 0.62% 0.76% 1.03%
               
Interest rate spread2.88% 2.82% 2.87% 2.64% 2.65%
Net interest rate margin3.00% 2.96% 3.02% 2.81% 2.88%
Ratio of interest-earning assets to interest-bearing liabilities141.01% 136.47% 132.30% 129.36% 127.82%
               

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

 Three Months Ended 
 June 30, 2021 vs. March 31, 2021 
 Increase (Decrease)  Total 
 Due to Changes in  Increase 
 Volume  Rate  (Decrease) 
Interest-earning assets:           
Loans$(3) $-  $(3)
Investment securities (10)  (8)  (18)
Interest-earning deposits 2   -   2 
Total interest-earning assets (11)  (8)  (19)
Interest-bearing liabilities:           
Savings accounts 1   (10)  (9)
NOW accounts -   (10)  (10)
Money market accounts (3)  (8)  (11)
Term certificates 18   (80)  (62)
Total interest-bearing deposits 16   (108)  (92)
FHLBB and FRB advances (70)  35   (35)
Total interest-bearing liabilities (54)  (73)  (127)
Change in net interest income$43  $65  $108 
            


 Three Months Ended 
 June 30, 2021 vs. 2020 
 Increase (Decrease)  Total 
 Due to Changes in  Increase 
 Volume  Rate  (Decrease) 
Interest-earning assets:           
Loans$157  $(375) $(218)
Investment securities (15)  (88)  (103)
Interest-earning deposits 4   -   4 
Total interest-earning assets 146   (463)  (317)
Interest-bearing liabilities:           
Savings accounts 43   (187)  (144)
NOW accounts 19   (31)  (12)
Money market accounts 2   (81)  (79)
Term certificates (181)  (320)  (501)
Total interest-bearing deposits (117)  (619)  (736)
FHLBB and FRB advances (98)  51   (47)
Total interest-bearing liabilities (215)  (568)  (783)
Change in net interest income$361  $105  $466 
            

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

 Year to Date 
 June 30, 2021 vs. 2020 
 Increase (Decrease)  Total 
 Due to Changes in  Increase 
 Volume  Rate  (Decrease) 
Interest-earning assets:           
Loans$313  $(643) $(330)
Investment securities (22)  (213)  (235)
Interest-earning deposits 3   (47)  (44)
Total interest-earning assets 294   (903)  (609)
Interest-bearing liabilities:           
Savings accounts 11   (340)  (329)
NOW accounts 18   (33)  (15)
Money market accounts (3)  (221)  (224)
Term certificates (502)  (654)  (1,156)
Total interest-bearing deposits (476)  (1,248)  (1,724)
FHLBB and FRB advances (14)  (4)  (18)
Total interest-bearing liabilities (490)  (1,252)  (1,742)
Change in net interest income$784  $349  $1,133 
            

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

 For the Three Months Ended June 30, 2021 
 Envision Bank  Envision Mortgage  Consolidated Total 
Net interest income$4,535  $664  $5,199 
Provision (credit) for loan losses (27)  -   (27)
Net interest income after provision (credit) for loan losses 4,562   664   5,226 
            
Non-interest income:           
Customer service fees 393   26   419 
Gain on loan origination and sale activities, net (1) -   6,558   6,558 
Mortgage servicing fees, net (94)  475   381 
Other 158   118   276 
Total non-interest income 457   7,177   7,634 
            
Non-interest expenses:           
Salaries and employee benefits 1,746   5,564   7,310 
Occupancy and equipment 407   214   621 
Other non-interest expenses 1,265   1,431   2,696 
Total non-interest expenses 3,418   7,209   10,627 
            
Income before income taxes and elimination of inter-segment profit$1,601  $632   2,233 
            
Elimination of inter-segment profit         (818)
Income before income taxes         1,415 
            
Income tax expense (benefit)         (162)
Net income        $1,577 

_____________________________
(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 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 (credit) 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.


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

 For the Three Months Ended June 30, 2020 
 Envision Bank  Envision Mortgage  Consolidated Total 
Net interest income$3,944  $789  $4,733 
Provision for loan losses 1,068   -   1,068 
Net interest income after provision for loan losses 2,876   789   3,665 
            
Non-interest income:           
Customer service fees 245   21   266 
Gain on loan origination and sale activities, net (1) -   14,736   14,736 
Mortgage servicing fees, net (95)  (1,258)  (1,353)
Other 85   132   217 
Total non-interest income 235   13,631   13,866 
            
Non-interest expenses:           
Salaries and employee benefits 1,925   6,476   8,401 
Occupancy and equipment 465   374   839 
Other non-interest expenses 1,057   1,082   2,139 
Total non-interest expenses 3,447   7,932   11,379 
            
Income (loss) before income taxes and elimination of inter-segment profit$(336) $6,488   6,152 
            
Elimination of inter-segment profit         (367)
Income before income taxes         5,785 
            
Income tax expense         594 
Net income        $5,191 

(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 Six Months Ended June 30, 2021 
 Envision Bank  Envision Mortgage  Consolidated Total 
Net interest income$8,736  $1,554  $10,290 
Provision (credit) for loan losses (240)  -   (240)
Net interest income after provision (credit) for loan losses 8,976   1,554   10,530 
            
Non-interest income:           
Customer service fees 733   53   786 
Gain on loan origination and sale activities, net (1) -   18,232   18,232 
Mortgage servicing fees, net (189)  1,349   1,160 
Other 309   251   560 
Total non-interest income 853   19,885   20,738 
            
Non-interest expenses:           
Salaries and employee benefits 3,548   12,199   15,747 
Occupancy and equipment 851   514   1,365 
Other non-interest expenses 2,349   3,117   5,466 
Total non-interest expenses 6,748   15,830   22,578 
            
Income before income taxes and elimination of inter-segment profit$3,081  $5,609   8,690 
            
Elimination of inter-segment profit         (1,499)
Income before income taxes         7,191 
            
Income tax expense         1,502 
Net income        $5,689 
            

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

 For the Six Months Ended June 30, 2020 
 Envision Bank  Envision Mortgage  Consolidated Total 
Net interest income$7,937  $1,220  $9,157 
Provision for loan losses 1,792   -   1,792 
Net interest income after provision for loan losses 6,145   1,220   7,365 
            
Non-interest income:           
Customer service fees 518   55   573 
Gain on loan origination and sale activities, net (1) -   22,209   22,209 
Mortgage servicing fees, net (182)  (2,426)  (2,608)
Other 225   247   472 
Total non-interest income 561   20,085   20,646 
            
Non-interest expenses:           
Salaries and employee benefits 5,023   11,504   16,527 
Occupancy and equipment 869   668   1,537 
Other non-interest expenses 2,203   2,071   4,274 
Total non-interest expenses 8,095   14,243   22,338 
            
Income (loss) before income taxes and elimination of inter-segment profit$(1,389) $7,062   5,673 
            
Elimination of inter-segment profit         (695)
Income before income taxes         4,978 
            
Income tax expense         605 
Net income        $4,373 
            

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

    Quarter Ended 
    June 30, 2021 
Adjustments Income Statement Section Income Before
Taxes
  Provision
(credit) for
Income Taxes
  Net Income  Earnings per
Share (diluted)
 
GAAP basis   $1,415  $(162) $1,577  $0.31 
Loss on disposal of fixed assets Non-interest income  29   8   21   - 
Accrued severance expenses Non-interest expense  145   41   104   0.02 
Other outsourcing expenses Non-interest expense  71   20   51   0.01 
Non-GAAP basis   $1,660  $(93) $1,753  $0.34 
                   
    Quarter Ended 
    March 31, 2021 
Adjustments Income Statement Section Income Before
Taxes
  Provision for
Income Taxes
  Net Income  Earnings per
Share (diluted)
 
GAAP basis   $5,776  $1,664  $4,112  $0.78 
Accrued severance expenses Non-interest expense  109   31   78   0.01 
Non-GAAP basis   $5,885  $1,695  $4,190  $0.79 
                   
    Quarter Ended 
    December 31, 2020 
Adjustments Income Statement Section Income Before
Taxes
  Provision for
Income Taxes
  Net Income  Earnings per
Share (diluted)
 
GAAP basis   $7,485  $2,211  $5,274  $1.01 
Residential lending office closure Non-interest expense  294   63   231   0.04 
COVID-19 related expenses Non-interest expense  69   15   54   0.01 
Non-GAAP basis   $7,848  $2,289  $5,559  $1.06 
                   
    Quarter Ended 
    September 30, 2020 
Adjustments Income Statement Section Income Before
Taxes
  Provision for
Income Taxes
  Net Income  Earnings per
Share (diluted)
 
GAAP basis   $12,946  $2,661  $10,285  $2.01 
COVID-19 related expenses Non-interest expense  22   4   18   - 
Non-GAAP basis   $12,968  $2,665  $10,303  $2.01 
                   
    Quarter Ended 
    June 30, 2020 
Adjustments Income Statement Section Income (Loss)
Before Taxes
  Provision for
Income Taxes
  Net Income  Earnings per
Share (diluted)
 
GAAP basis   $5,785  $594  $5,191  $1.02 
COVID-19 related expenses Non-interest expense  189   -   189   0.04 
Non-GAAP basis   $5,974  $594  $5,380  $1.06 
                   

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

    Year to Date 
    June 30, 2021 
Adjustments Income Statement Section Income
Before Taxes
  Provision for
Income Taxes
  Net Income  Earnings per
Share (diluted)
 
GAAP basis   $7,191  $1,502  $5,689  $1.10 
Loss on disposal of fixed assets Non-interest income  29   8   21   - 
Accrued severance expenses Non-interest expense  254   72   182   0.04 
Other outsourcing expenses Non-interest expense  71   20   51   0.01 
Non-GAAP basis   $7,545  $1,602  $5,943  $1.15 
                   
    Year to Date 
    June 30, 2020 
Adjustments Income Statement Section Income
Before Taxes
  Provision for
Income Taxes
  Net Income
(Loss)
  Earnings per
Share (diluted)
 
GAAP basis   $4,978  $605  $4,373  $0.86 
Retirement salary and benefits compensation Non-interest expense  692   -   692   0.14 
Accelerated vesting of stock-based compensation Non-interest expense  683   -   683   0.13 
COVID-19 related expenses Non-interest expense  207   -   207   0.04 
Non-GAAP basis   $6,560  $605  $5,955  $1.17 
                   

Randolph Bancorp, Inc.
Selected Financial Highlights
(Unaudited)

 At or for the Three Months Ended 
 June 30,  March 31,  December 31,  September 30,  June 30, 
 2021  2021  2020  2020  2020 
Return on average assets: (1, 5)                   
GAAP 0.86%  2.26%  2.95%  5.82%  2.97%
Non-GAAP (2) 0.96%  2.30%  3.11%  5.83%  3.08%
                    
Return on average equity: (1, 6)                   
GAAP 6.11%  15.90%  21.05%  45.22%  25.16%
Non-GAAP (2) 6.79%  16.21%  22.18%  45.30%  26.07%
                    
Net interest margin 3.00%  2.96%  3.02%  2.81%  2.88%
                    
Non-interest income to total income:                   
GAAP 56.73%  70.93%  75.57%  80.98%  74.04%
Non-GAAP (2) 56.83%  70.93%  75.57%  80.98%  74.04%
                    
Profit percentage (9)                   
GAAP 11.55%  31.76%  37.33%  54.97%  37.59%
Non-GAAP (2) 13.56%  32.39%  39.09%  55.06%  38.62%
                    
Efficiency ratio: (7)                   
GAAP 88.45%  68.24%  62.67%  45.03%  62.41%
Non-GAAP (2) 86.44%  67.61%  60.91%  44.94%  61.38%
                    
Tier 1 capital to average assets (3) 13.72%  13.81%  13.85%  13.28%  11.93%
                    
Non-performing assets as a percentage of total assets (4) 0.86%  1.14%  1.01%  1.38%  0.47%
                    
Allowance for loan losses as a percentage of total loans (4) 1.19%  1.32%  1.39%  1.35%  1.22%
Allowance for loan losses as a percentage of total loans, excluding SBA PPP Loans (4) 1.22%  1.36%  1.41%  1.39%  1.26%
                    
Allowance for loan losses as a percentage of non-performing assets 101.89%  78.99%  94.58%  67.21%  179.31%
Allowance for loan losses as a percentage of non-performing loans 101.89%  77.75%  92.87%  66.31%  186.60%
                    
Tangible book value per share (8)$19.16  $18.80  $18.16  $17.18  $15.43 
Outstanding shares 5,254,522   5,364,240   5,495,514   5,524,390   5,479,884 


(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 $28,000, $31,000, $33,000, $36,000, and $38,000 at June 30, 2021, March 31, 2021, December 31, 2020, September 30, 2020, and June 30, 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.
Selected Financial Highlights
(Unaudited)

 At or for the Six Months Ended 
 June 30,  June 30, 
 2021  2020 
Return on average assets: (1, 5)       
GAAP 1.56%  1.31%
Non-GAAP (2) 1.63%  1.78%
        
Return on average equity: (1, 6)       
GAAP 11.01%  10.77%
Non-GAAP (2) 11.50%  14.67%
        
Net interest margin 2.98%  2.89%
        
Non-interest income to total income:       
GAAP 65.15%  68.54%
Non-GAAP (2) 65.19%  68.54%
        
Profit percentage (9)       
GAAP 23.54%  23.26%
Non-GAAP (2) 24.71%  28.69%
        
Efficiency ratio: (7)       
GAAP 76.46%  76.74%
Non-GAAP (2) 75.29%  71.31%
        
Tier 1 capital to average assets (3) 13.72%  11.93%
        
Non-performing assets as a percentage of total assets (4) 0.86%  0.47%
        
Allowance for loan losses as a percentage of total loans (4) 1.19%  1.22%
Allowance for loan losses as a percentage of total loans, excluding SBA PPP Loans (4) 1.22%  1.26%
        
Allowance for loan losses as a percentage of non-performing assets 101.89%  179.31%
Allowance for loan losses as a percentage of non-performing loans 101.89%  186.60%
        
Tangible book value per share (8)$19.16  $15.43 
Outstanding shares 5,254,522   5,479,884 


(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 $28,000 and $38,000 at June 30, 2021 and June 30, 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 June 30, 2021 
 Commercial loans  Residential and
consumer loans
  Residential loans
serviced for others
 
 (Dollars in thousands) 
Balance outstanding$202,743  $343,655  $1,999,083 
            
COVID-19 related loan payment deferrals:           
Loans in COVID-19-related loan payment deferral$1,006  $2,209  $5,488 
Loans in deferral as a percentage of category loans 0.5%  0.6%  0.3%
Loans with suspended payment$1,006  $1,957  $1,880 
Loans with reduced payment -   252   3,608 
            
Loans which obtained a COVID-19-related payment deferral but           
have since resumed payment$36,955  $17,683  $61,872 
Loans reinstated (borrower paid any unpaid principal and interest) 1,551   2,235   5,767 
Loans on a repayment plan -   -   1,341 
Loans which resumed payment but deferred principal and/or           
interest payments to maturity 28,594   9,309   39,077 
Loans which were paid off completely 6,810   5,342   15,687 
            

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

COVID-19 Highly Impacted Sectors

  As of June 30, 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 $1,067   $1,067   $-   $-  $1,067 $- $-
Hotels/hospitality  9,592    9,528    64    -   64  9,528  -
Restaurants/food service  2,639    1,526    1,113    -   2,639  -  -
Retail/shopping center  21,887    14,560    -    3,662   16,604  1,618  1,006
Other sectors (2)  11,385    9,433    95    300   9,208  620  -
Total loans in COVID-19 impacted sectors $41,348   $36,114   $1,272   $3,962  $29,582 $11,766 $1,006
Percentage of commercial loans outstanding 22.7%  24.6%  5.3%  34.5%         
Commercial loans outstanding $182,277   $146,930   $23,869   $11,478          
Loan to value secured by real estate (3)     54.6%      63.6%         


(1)This disclosure focuses on industries with balances that are significant to the portfolio at June 30, 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)