Juniata Valley Financial Corp. Announces Results for the Quarter Ended March 31, 2022


Mifflintown, PA, April 22, 2022 (GLOBE NEWSWIRE) --

Juniata Valley Financial Corp. (OTC Pink: JUVF) (“Juniata”), announced net income for the quarter ended March 31, 2022 of $2.1 million, an increase of 29.4%, compared to net income of $1.6 million for the quarter ended March 31, 2021. Earnings per share, basic and diluted, for the three months ended March 31, 2022 was $0.42, 27.3% greater than the $0.33 reported for the three months ended March 31, 2021.

President’s Message

President and Chief Executive Officer, Marcie A. Barber stated, “We are very pleased to deliver strong financial performance as we begin a new fiscal year. These results are indicative of our resolve to responsibly navigate changes in this challenging economic environment as evidenced by our strong credit quality. We are focused on expanding quality loan relationships and deploying excess cash in a strategic manner, while exploring and implementing technologies to reduce operating expenses.”      

Financial Results for the Quarter

Annualized return on average assets for the three months ended March 31, 2022 was 1.04 %, compared to 0.82% for the three months ended March 31, 2021. Annualized return on average equity for the three months ended March 31, 2022 was 12.55%, compared to 8.68% for the three months ended March 31, 2021.

Net interest income was $5.9 million for the first quarter of 2022 compared to $4.9 million for the first quarter of 2021. Average earning assets increased 3.7%, to $768.5 million, during the three months ended March 31, 2022 compared to the same period in 2021, due to an increase of $47.8 million in average investment securities. The increase in average investment securities was partially offset by a decline of $12.5 million in average loans, primarily due to the forgiveness of PPP loans. While the average loan volume declined between the first quarter of 2021 versus 2022, total loan yield increased by 46 basis points, primarily due to interest collected on previously charged off nonaccrual loans. The yield on earning assets increased 26 basis points, to 3.45%, in the first quarter of 2022 compared to same period last year, while the cost to fund interest earning assets with interest bearing liabilities decreased 23 basis points, to 0.43%, over the same comparable period. During the three months ended March 31, 2022, average interest bearing liabilities increased by $9.1 million compared to the three months ended March 31, 2021, due to growth in average interest-bearing deposits of $63.3 million driven by deposits of government stimulus payments and increased consumer saving during the pandemic, as well as Juniata’s use of brokered deposits. The growth in interest-bearing deposits was partially offset by a decline of $54.2 million in short- and long-term borrowings due to reductions in FRB advances and FHLB borrowings. The net interest margin, on a fully tax equivalent basis, increased from 2.75% during the three months ended March 31, 2021 to 3.17% during the three months ended March 31, 2022.

A loan provision expense of $28,000 was recorded in the first quarter of 2022, compared to a provision credit of $79,000 in the first quarter of 2021. While Juniata continued to experience favorable asset quality trends and net recoveries during the first quarter of 2022, elevated qualitative risk factors were considered in its allowance for loan loss analysis for certain loan segments due to the uncertainty in the economy caused by inflation, labor shortages and supply chain disruptions.

Non-interest income was $1.3 million in both the first quarter of 2022 and 2021. Most significantly impacting non-interest income in the comparative three month periods was a decrease in the value of equity securities of $116,000 in the first quarter of 2022 compared to the first quarter of 2021. Offsetting this decline over the comparative three month periods were increases in customer service and trust fees, as well as commissions from the sales of non-deposit products and fees derived from loan activity.

Non-interest expense was $4.9 million in the three months ended March 31, 2022 compared to $4.6 million in the three months ended March 31, 2021, an increase of 6.0%. Most significantly impacting non-interest expense in the comparative three month periods was a $209,000 increase in employee compensation and benefits expense due to temporary duplication of compensation and benefits expense from employee transitions and increased medical claims expenses, in addition to a $42,000 decline in the gain on other real estate owned. Partially offsetting these increases in the first quarter of 2022 compared to the first quarter of 2021 were declines in equipment expense and professional fees.

Income tax expense of $209,000 was recorded in the first quarter of 2022 compared to an income tax expense of $71,000 recorded in the first quarter of 2021, primarily due to higher taxable income recorded in the 2022 period.

Financial Condition

Total assets as of March 31, 2022 were $807.9 million, a decrease of $2.6 million, compared to total assets of $810.5 million on December 31, 2021. Comparing asset balances on March 31, 2022 and December 31, 2021, cash and cash equivalents increased by $2.5 million, while debt securities available for sale and total loans decreased by $4.4 million and $5.7 million, respectively. Over the same period, deposits increased by $12.4 million, with growth in both non-interest and interest bearing demand deposits. Shareholders’ equity decreased by $14.6 million when comparing March 31, 2022 to December 31, 2021, due to a decline in the fair value of debt securities between the two periods.

Subsequent Event

On April 19, 2022, the Board of Directors declared a cash dividend of $0.22 per share to shareholders of record on May 16, 2022, payable on June 1, 2022.

Management considers subsequent events occurring after the statement of condition date for matters which may require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s consolidated financial statements when filed with the Securities and Exchange Commission. Accordingly, the financial information in this release is subject to change.

The Juniata Valley Bank, the principal subsidiary of Juniata Valley Financial Corp., is headquartered in Mifflintown, Pennsylvania, with nineteen community offices located in Juniata, Mifflin, Perry, Huntingdon, McKean and Potter Counties. More information regarding Juniata Valley Financial Corp. and The Juniata Valley Bank can be found online at www.JVBonline.com. Juniata Valley Financial Corp. trades through the Pink Open Market under the symbol JUVF.

Forward-Looking Information

*This press release may contain “forward looking” information as defined by the Private Securities Litigation Reform Act of 1995. When words such as “believes”, “expects”, “anticipates” or similar expressions are used in this release, Juniata is making forward-looking statements. Such information is based on Juniata’s current expectations, estimates and projections about future events and financial trends affecting the financial condition of its business. These statements are not historical facts or guarantees of future performance, events or results. Such statements involve potential risks and uncertainties and, accordingly, actual results may differ materially from this forward-looking information. Many factors could affect future financial results. Juniata undertakes no obligation to publicly update or revise forward looking information, whether because of new or updated information, future events, or otherwise. For a more complete discussion of certain risks and uncertainties affecting Juniata, please see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Forward-Looking Statements” set forth in the Juniata’s filings with the Securities and Exchange Commission.

Financial Statements

Juniata Valley Financial Corp. and Subsidiary
Consolidated Statements of Financial Condition

       
(Dollars in thousands, except share data)    (Unaudited)     
  March 31, 2022 December 31, 2021
ASSETS      
Cash and due from banks $14,998  $12,928 
Interest bearing deposits with banks  1,051   598 
Federal funds sold      
Cash and cash equivalents  16,049   13,526 
       
Interest bearing time deposits with banks  490   735 
Equity securities  1,101   1,124 
Debt securities available for sale  331,043   335,424 
Restricted investment in bank stock  1,826   2,116 
Total loans  412,575   418,303 
Less: Allowance for loan losses  (3,576)  (3,508)
Total loans, net of allowance for loan losses  408,999   414,795 
Premises and equipment, net  8,356   8,371 
Other real estate owned     87 
Bank owned life insurance and annuities  16,911   16,852 
Investment in low income housing partnerships  2,106   2,306 
Core deposit and other intangible assets  162   175 
Goodwill  9,047   9,047 
Mortgage servicing rights  111   120 
Accrued interest receivable and other assets  11,673   5,840 
Total assets $807,874  $810,518 
LIABILITIES AND STOCKHOLDERS' EQUITY        
Liabilities:        
Deposits:        
Non-interest bearing $188,710  $182,022 
Interest bearing  532,159   526,425 
Total deposits  720,869   708,447 
       
Short-term borrowings and repurchase agreements  4,753   4,227 
Long-term debt  20,000   20,000 
Other interest bearing liabilities  1,540   1,568 
Accrued interest payable and other liabilities  3,987   4,986 
Total liabilities  751,149   739,228 
Commitments and contingent liabilities      
Stockholders' Equity:        
Preferred stock, no par value: Authorized - 500,000 shares, none issued      
Common stock, par value $1.00 per share: Authorized 20,000,000 shares; Issued - 5,151,279 shares at March 31, 2022 and December 31, 2021; Outstanding - 4,998,858 shares at March 31, 2022 and 4,988,542 shares at December 31, 2021  5,151   5,151 
Surplus  24,864   25,008 
Retained earnings  48,313   47,298 
Accumulated other comprehensive loss  (18,979)  (3,365)
Cost of common stock in Treasury: 152,421 shares at March 31, 2022; 162,737 shares at December 31, 2021  (2,624)  (2,802)
Total stockholders' equity  56,725   71,290 
Total liabilities and stockholders' equity $807,874  $810,518 


Juniata Valley Financial Corp. and Subsidiary
Consolidated Statements of Income (Unaudited)

       
  Three Months Ended
(Dollars in thousands, except share and per share data) March 31, 
     2022     2021 
Interest income:    
Loans, including fees $5,108  $4,777 
Taxable securities  1,377   1,006 
Tax-exempt securities  40   38 
Other interest income  7   5 
Total interest income  6,532   5,826 
Interest expense:        
Deposits  462   619 
Short-term borrowings and repurchase agreements  13   32 
FRB advances     18 
Long-term debt  116   212 
Other interest bearing liabilities  1   2 
Total interest expense  592   883 
Net interest income  5,940   4,943 
Provision for loan losses  28   (79)
Net interest income after provision for loan losses  5,912   5,022 
Non-interest income:        
Customer service fees  357   325 
Debit card fee income  410   413 
Earnings on bank-owned life insurance and annuities  52   54 
Trust fees  155   112 
Commissions from sales of non-deposit products  104   80 
Fees derived from loan activity  130   104 
Mortgage banking income  7   8 
Gain on sales and calls of securities     4 
Change in value of equity securities  (23)  93 
Other non-interest income  84   79 
Total non-interest income  1,276   1,272 
Non-interest expense:        
Employee compensation expense  2,022   1,969 
Employee benefits  701   545 
Occupancy  331   330 
Equipment  175   189 
Data processing expense  579   583 
Professional fees  176   188 
Taxes, other than income  131   124 
FDIC Insurance premiums  92   81 
Gain on other real estate owned  (7)  (49)
Amortization of intangible assets  13   16 
Amortization of investment in low-income housing partnerships  200   200 
Other non-interest expense  451   412 
Total non-interest expense  4,864   4,588 
Income before income taxes   2,324   1,706 
Income tax provision  209   71 
Net income $2,115  $1,635 
Earnings per share        
Basic $0.42  $0.33 
Diluted $0.42  $0.33 

 

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