Elmira Savings Bank Reports First Quarter Earnings

Elmira, New York, UNITED STATES


ELMIRA, N.Y., April 27, 2022 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ: ESBK)

Highlights

  • Net income was $1,168,000 for the three months ended March 31, 2022, compared to $1,204,000 for the same period in 2021.

  • Diluted earnings per share were $.33 per share for the three months ended March 31, 2022, compared to $.34 per share for the same period in 2021.

  • Return on average assets was .76% for the three months ended March 31, 2022, and .75% for the same period in 2021.

  • Return on average equity was 7.32% for the three months ended March 31, 2022, compared to 7.93% for the same period in 2021.

"Earnings per share and return on assets are consistent with last year’s first quarter, as we work diligently towards the merger and integration with Community Bank, N.A, which is expected to take place in the second quarter," said Thomas M Carr, President and CEO.

Net Income

Net income totaled $1,168,000 for the three months ended March 31, 2022, a decrease of $36,000 or 3.0% from the $1,204,000 recorded for the same period in 2021. This decrease was the net result of a decrease in net interest income of $399,000 and a decrease in noninterest income of $1,038,000, offset by a decrease in the provision for loan losses of $150,000, a decrease in noninterest expense of $1,177,000, and a decrease in tax expense of $74,000.

Basic and diluted earnings per share for the three months ended March 31, 2022 were both $.33 per share compared to $.34 per share for both for the same period in 2021.

The decrease in noninterest income for the three months ended March 31, 2022 is primarily due to a decrease in the gain on sale of loans, reflecting lower levels of residential mortgages originated for sale to the secondary markets compared to the same period in 2021. The decrease in noninterest expense for the three months ended March 31, 2022 reflects lower levels of salaries and benefits, occupancy expense, and all other expense categories. The lower levels of salaries and benefits and all other expense categories relate to staffing reductions and controlled spending reductions leading up to the upcoming merger.

Net Interest Margin

The net interest margin for the three months ended March 31, 2022 was 3.46% compared to 3.57% for the first quarter of 2021. The yield on average earning assets was 3.79% for the three months ended March 31, 2022, compared to 4.29% for the same period in 2021. The average cost of interest-bearing liabilities was 0.36% for the three months ended March 31, 2022, compared to 0.79% for the three months ended March 31, 2021.

Assets

Total assets decreased $18.9 million or 3.0% to $613.4 million at March 31, 2022, compared to $632.2 million at December 31, 2021. Loans receivable decreased 1.4% to $457.9 million at March 31, 2022, compared to December 31, 2021. The available-for-sale investment portfolio decreased $470,000 from December 31, 2021 to March 31, 2022, and cash and cash equivalents decreased by $10.7 million from December 31, 2021 to March 31, 2022. The decrease in cash resulted primarily from a $17.6 million decrease in deposits.

Nonperforming Loans

Our nonperforming loans to total loans ratio was 0.83% at March 31, 2022, and 0.70% at December 31, 2021. Net loan charge-offs to average loans for the three months ended March 31, 2022 was .05% and .03% for the three months ended March 31, 2021. The allowance for loan losses was 1.22% of total loans at March 31, 2022 and 1.21% at December 31, 2021.

Liabilities

Deposits totaled $523.4 million at March 31, 2022, a decrease of $17.6 million or 3.3% from the December 31, 2021 total of $541.0 million. Borrowed funds decreased by $2.0 million from December 31, 2021 to $20.0 million at March 31, 2022.

Shareholders’ Equity

Shareholders’ equity increased $677,000 to $64.7 million at March 31, 2022 compared to December 31, 2021. The current level of shareholders’ equity equates to a book value per share of $18.16 at March 31, 2022, compared to $18.02 at December 31, 2021. Dividends paid to common shareholders were $0.15 for the three months ended March 31, 2022 and March 31, 2021.

Elmira Savings Bank, with $613.4 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with five offices in Chemung County, NY; three offices in Tompkins County, NY; two offices in Steuben County, NY; one office in Cayuga County, NY; one office in Schuyler County; and a loan center in Broome County, NY.

On October 4, 2021, Elmira Savings Bank, in a joint press release with Community Bank System, Inc. (NYSE: CBU), announced that it had entered into a definitive agreement to be acquired by Community Bank System’s bank subsidiary, Community Bank, N.A. for approximately $82.8 million in cash. Community Bank System, with reported assets of over $15.3 billion, is headquartered in DeWitt, New York and is among the country’s 125 largest banking institutions. On December 14, 2021, at a Special Shareholders Meeting the shareholders of Elmira Savings Bank approved the merger with more than 98% of the votes cast in favor of the merger. On April 22, 2022, Community Bank, N.A. announced that it had received regulatory approvals to complete its merger with Elmira Savings Bank. The acquisition is expected to be complete effective close of business May 13, 2022, subject to customary closing conditions and approval from the New York State Department of Financial Services.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank’s regulatory reports.

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

 
ELMIRA SAVINGS BANK
CONSOLIDATED BALANCE SHEET
(unaudited)
      
(in thousands, except for share and per share data)March 31, December 31,  
  2022  2021 % Change
ASSETS     
      
Cash and due from banks$90,905  $99,785  -8.9%
Federal funds sold and other short-term investments 195   2,058  -90.5%
Total cash and cash equivalents 91,100   101,843  -10.5%
      
Securities available for sale, at fair value 3,639   4,109  -11.4%
Securities held to maturity - fair value $5,982     
at March 31, 2022, and $6,315 at December 31, 2021 5,992   6,080  -1.4%
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost 7,975   8,087  -1.4%
      
Loans held for sale 435   2,374  -81.7%
      
Loans receivable 457,900   464,246  -1.4%
Less: Allowance for loan losses 5,569   5,620  -0.9%
Net loans 452,331   458,626  -1.4%
      
Premises and equipment, net 16,397   15,558  5.4%
Bank-owned life insurance 16,019   15,914  0.7%
Accrued interest receivable 1,376   1,380  -0.3%
Goodwill 12,320   12,320  0.0%
Other assets 5,787   5,941  -2.6%
Total assets$613,371  $632,232  -3.0%
      
LIABILITIES AND SHAREHOLDERS' EQUITY     
      
Deposits$523,402  $540,999  -3.3%
Borrowings 20,000   22,000  -9.1%
Other liabilities 5,315   5,256  1.1%
Total liabilities 548,717   568,255  -3.4%
      
Shareholders' equity:     
Preferred stock, $1 par value; $1,000 liquidation value per issued share; 5,000,000 shares authorized;     
10,000 shares issued and none outstanding at March 31, 2022 and at December 31, 2021 9,700   9,700  0.0%
Common stock, $1 par value; authorized 5,000,000 shares; 3,651,426 shares issued and 3,557,543 outstanding          
at March 31, 2022 and 3,641,487 shares issued and 3,547,604 outstanding at December 31, 2021 3,651   3,641  0.3%
Additional paid-in capital 54,551   54,421  0.2%
Retained earnings 8,922   8,288  7.6%
Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares     
at March 31, 2022 and December 31, 2021 (12,202)  (12,202) 0.0%
Accumulated other comprehensive (loss) income (18)  79  -122.8%
Total Elmira Savings Bank shareholders' equity 64,604   63,927  1.1%
Noncontrolling interest 50   50  0.0%
Total shareholders' equity 64,654   63,977  1.1%
Total liabilities and shareholders' equity$613,371  $632,232  -3.0%
      


ELMIRA SAVINGS BANK
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
      
 Three Months Ended
 March 31,
(in thousands, except for per share data) 2022
  2021
 % Change
      
Interest and dividend income:     
Interest and fees on loans$4,338  $5,212  -16.8%
Interest and dividends on securities     
Taxable 112   143  -21.7%
Non-taxable 62   69  -10.1%
Total interest and dividend income 4,512   5,424  -16.8%
      
Interest expense:     
Interest on deposits 250   725  -65.5%
Interest on borrowings 140   178  -21.3%
Total interest expense 390   903  -56.8%
Net interest income 4,122   4,521  -8.8%
Provision for loan losses -   150  -100.0%
Net interest income after provision for loan losses 4,122   4,371  -5.7%
      
Noninterest income:     
Service fees 302   308  -1.9%
Gain on sale of loans held for sale 255   1,211  -78.9%
Other service fees 201   210  -4.3%
Earnings on bank-owned life insurance 105   101  4.0%
Other 24   95  -74.7%
Total noninterest income 887   1,925  -53.9%
      
Noninterest expense:     
Salaries and benefits 1,761   2,307  -23.7%
Net occupancy 412   626  -34.2%
Equipment 390   442  -11.8%
Marketing and public relations 92   241  -61.8%
Professional fees 87   147  -40.8%
Other 781   937  -16.6%
Total noninterest expense 3,523   4,700  -25.0%
Income before income taxes 1,486   1,596  -6.9%
Income taxes 318   392  -18.9%
Net income 1,168   1,204  -3.0%
Less: Net income attributable to noncontrolling interest -   -  - 
      
Net income attributable to Elmira Savings Bank$1,168  $1,204  -3.0%
      
      
Basic earnings per share$0.33  $0.34  -2.9%
      
Diluted earnings per share$0.33  $0.34  -2.9%
      
Weighted average shares outstanding - basic 3,533,077   3,514,650  0.5%
      
Weighted average shares outstanding - diluted 3,560,126   3,515,256  1.3%
      
Dividends per share$0.15  $0.15  0.0%
      


ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
                  
(Dollars in Thousands)For the Three Months Ended
 March 31, 2022 March 31, 2021
ASSETS:Average Balance Interest Average Rate Average Balance Interest Average Rate
Loans$458,353  $4,338  3.80% $485,646  $5,212  4.31%
Short-term investments 1,781   -  0.06   617   -  0.02 
Securities 18,025   174  3.89   21,267   212  4.01 
Total interest-earning assets 478,159   4,512  3.79   507,530   5,424  4.29 
                  
Noninterest-earning assets 143,931         140,728       
                  
TOTAL ASSETS$622,090        $648,258       
                  
LIABILITIES AND SHAREHOLDERS' EQUITY                 
Interest-bearing deposits$414,018  $250  0.24  $436,731  $725  0.67 
Borrowings 21,978   140  2.55   26,933   178  2.65 
Total interest-bearing liabilities 435,996   390  0.36   463,664   903  0.79 
                  
Noninterest-bearing liabilities 121,433         123,014       
Shareholders' equity 64,661         61,580       
                  
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$622,090        $648,258       
Interest rate spread      3.43%       3.50%
Net interest income/margin   $4,122  3.46%    $4,521  3.57%
                  


     Quarter Ended
(Dollars in Thousands, Except Per Share Data) 3/31/2022  12/31/2021  9/30/2021  6/30/2021  3/31/2021 
                
Operating Data               
                
Net income$1,168 $1,102 $1,511 $1,402 $1,204 
Net interest income 4,122  4,437  4,708  4,340  4,521 
Provision for loan losses -  -  -  -  150 
Non-interest income, ex. Net security gains 887  1,158  1,564  1,347  1,925 
Non-interest expense 3,523  4,187  4,307  3,904  4,700 
           
Performance Statistics          
           
Net interest margin 3.46% 3.65% 3.81% 3.48% 3.57%
Annualized return on average assets 0.76% 0.69% 0.92% 0.86% 0.75%
Annualized return on average equity 7.32% 6.82% 9.49% 9.03% 7.93%
Annualized net loan charge-offs to avg loans 0.05% 0.01% 0.14% 0.06% 0.03%
Net charge-offs 52  7  164  74  40 
Efficiency ratio 70.3% 74.8% 68.7% 68.6% 72.9%
                
Per Share Data          
           
Basic earnings per share$0.33 $0.31 $0.43 $0.40 $0.34 
Diluted earnings per share 0.33  0.31  0.43  0.40  0.34 
Dividend declared per share 0.15  0.15  0.15  0.15  0.15 
Book value 18.16  18.02  17.86  17.57  17.34 
Common stock price:          
High 23.00  23.22  14.75  15.05  15.96 
Low 22.69  13.50  12.80  13.23  11.48 
Close 22.93  22.84  13.34  14.31  13.50 
Weighted average common shares:          
Basic 3,533  3,526  3,522  3,519  3,515 
Fully diluted 3,560  3,553  3,524  3,520  3,515 
End-of-period common shares:          
Issued 3,651  3,641  3,641  3,641  3,636 
Treasury 94  94  94  94  94 
           
           
Financial Condition Data:          
General          
Total assets$613,371 $632,232 $643,596 $648,686 $659,333 
Loans, net 452,331  458,626  458,631  465,271  476,383 
Intangibles 12,320  12,320  12,320  12,320  12,320 
Total deposits 523,402  540,999  544,763  551,245  562,893 
                
Noninterest-bearing 115,680  122,268  118,511  121,534  121,101 
                
Savings 99,642  97,479  95,299  93,351  87,228 
NOW 109,999  112,519  114,514  111,343  111,414 
Money Market 30,233  34,626  36,577  32,624  35,011 
Time deposits 167,848  174,107  179,862  192,393  208,139 
Total interest-bearing deposits 407,722  418,731  426,252  429,711  441,792 
                
Shareholders' equity 64,654  63,977  63,396  62,375  61,462 
                
Asset Quality          
           
Non-performing assets$4,173 $3,675 $3,645 $5,023 $5,602 
Non-performing assets to total assets 0.68% 0.58% 0.57% 0.77% 0.85%
Allowance for loan losses 5,569  5,620  5,627  5,791  5,865 
Allowance for loan losses to total loans 1.22% 1.21% 1.21% 1.23% 1.22%
Allowance for loan losses to          
non-performing loans 148.98% 174.37% 175.95% 116.12% 108.63%
Non-performing loans to total loans 0.83% 0.70% 0.70% 1.07% 1.13%
           
Capitalization          
           
Shareholders' equity to total assets 10.54% 10.12% 9.85% 9.62% 9.32%