Wake Forest Bancshares, Inc. Announces Third Quarter Results

Wake Forest, North Carolina, UNITED STATES

WAKE FOREST, N.C., July 20, 2021 (GLOBE NEWSWIRE) -- Wake Forest Bancshares, Inc., (OTC: WAKE) parent company of Wake Forest Federal Savings and Loan Association, announced today that the Company reported earnings of $322,721 or $0.29 per share for its quarter ended June 30, 2021. The Company reported earnings of $254,566 or $0.23 per share for the same quarter a year earlier. Earnings for the first nine months of the Company’s fiscal year were reported at $910,146 or $0.83 per share versus $902,313 or $0.82 per share for the same nine month period a year earlier.

Renee H. Shaw, President and Chief Executive Officer stated that the Company’s earnings were reflective of improving conditions associated with the re-opening of our economies from COVID 19 pandemic restrictions. The Company’s quarterly results exceeded expectations and budgetary amounts established at the beginning of its fiscal year. However, earnings for the current quarter as well as year to date profits continue to be adversely impacted by the Federal Reserve Board’s policy to maintain short term interest rates at historically low levels, a decision initiated in March of 2020 at the start of the Pandemic. As a result, the Company’s overall interest rate margin was 3.11% for its current quarter, a slight improvement from it 3.00% margin during the height of the Pandemic a year earlier but significantly less than the 3.77% margin from the same quarter two years ago prior to the Fed’s actions to significantly lower interest rates to support the weakened economy.

While economic conditions continue to show consistent steady improvement, residential home sales in our local markets have remained robust throughout the Pandemic. Our lending environment benefits because we are a part of the Research Triangle area which is generally recognized as one of the top regions in the country for innovation, economic activity and quality of life issues. During the most recent quarter, our real estate market remained strong not only due to historically low mortgage rates, but also because of sizable gains in home prices during the past year and extremely tight housing inventories.

The Company’s loan portfolio has grown slightly from levels outstanding a year ago. The Company has been pleased with its lending performance during the Pandemic, particularly since the size of the Company’s loan portfolio was never distorted by any short term PPP loans. In addition, the Pandemic failed to impact the credit quality of our loan portfolio, perhaps because financial assistance in the form of stimulus payments, low interest government supported loans, and enhanced unemployment insurance payments have concealed the potential long term effects of the economic slowdown. During the spring of 2020 the Company provided loan modifications to certain borrowers adversely and directly impacted by the Pandemic but those accommodations ended in September of 2020 and all modified loans have since returned to scheduled payment status. The Company was delighted to report that it had no problem assets or loan charge-offs during the current quarter. As a result, no additional loan loss provisions were considered necessary because of the healthy level of our existing loss allowances. The Company’s loan loss allowance amounted to approximately 2.10% of total loans outstanding at June 30, 2021. The Company will continue to evaluate whether lingering effects from the Pandemic impact our credit quality and consider any future adjustments to its loss allowances.

Total assets of the Company amounted to $111,850,039 at June 30, 2021. Total loans receivable and deposits outstanding at June 30, 2021 amounted to $68,627,318 and $83,750,406, respectively. Wake Forest Bancshares Inc.’s tier 1 capital leverage ratio was 23.92% at June 30, 2021. Wake Forest Bancshares, Inc. has 1,095,195 shares of common stock outstanding. Based in Wake Forest, North Carolina since 1922, the Company conducts business as Wake Forest Federal from its office in Wake Forest, (Wake County), North Carolina.

Contact: Renee H. Shaw, CEO 
(919) 556-5146