Sierra Bancorp Announces Record Quarterly and Year to Date Earnings | Financial Buzz

Sierra Bancorp Announces Record Quarterly and Year to Date Earnings

Sierra Bancorp (Nasdaq: BSRR), parent of Bank of the Sierra, today announced its unaudited financial results for the three- and six-month periods ended June 30, 2021. Sierra Bancorp reported consolidated net income of $11.7 million, or $0.76 per diluted share, for the second quarter of 2021, compared to $8.3 million, or $0.54 per diluted share, in the second quarter of 2020.

For the first six months of 2021, the Company recognized net income of $22.8 million as compared to $16.1 million for the same period in 2020. The Company’s financial performance metrics for the first half of 2021 include an annualized return on average equity of 13.11%, a return on average assets of 1.41%, and diluted earnings per share of $1.48.

“We are pleased to report another quarter of record earnings!” stated Kevin McPhaill, President and CEO. “Our strong results in the second quarter of 2021 are thanks to the continued hard work and persistence of our banking team. While we anticipate headwinds during the second half of this year due to historically low interest rates and competitive pressures, our core earnings engine remains strong, and our team is committed to meeting these challenges. We will continue to look for additional opportunities and we are excited about the future of Bank of the Sierra!” McPhaill concluded.

Financial Highlights

Quarterly Changes (comparisons to the second quarter of 2020)

  • The change in quarterly net income was primarily due to a $2.1 million negative provision for loan and lease losses. This significant decrease is attributable to the impact of continued improvements in the overall economy, lower historical loss rates, net recoveries during the past two quarters, and a $272.7 million decrease in average balances of net loans and leases.
  • Net interest income increased $3.0 million, or 13%, due primarily to increases in average loan balances and a lower cost of funds.

Year to-Date Changes (comparisons to the first six-months of 2020)

  • Net income increased by $6.7 million due mostly to a $1.9 million negative provision for loan and lease losses, attributed to the same reasons as noted above in the quarterly comparison.
  • Net interest income increased by $7.8 million, or 16%, as declines in loan yields were offset by higher balances and lower interest expense.
  • The above year-to-date increases were partially offset by an increase in noninterest expense of $4.7 million, or 13%, due mostly to a $2.1 million increase in salaries and benefits, $1.4 million in professional services, and $0.8 million in data processing expenses.

Balance Sheet Changes (comparisons to December 31, 2020)

  • Total assets increased to $3.3 billion, representing an increase of $51.3 million, or 2%, during the first half of the year.
  • Cash and due from banks increased 424% to $373.9 million during the first six months of the year due mostly to higher deposit balances coupled with lower loan balances.
  • Gross loans declined $318.3 million due predominantly to a $157.3 million decline in mortgage warehouse line utilization, a $100 million decline in real estate loans mostly due to lower commercial real estate balances, and a $58.4 million decrease in commercial and industrial loans, which was mostly PPP loan forgiveness.
  • Deposits totaled $2.8 billion at June 30, 2021, representing a year-to-date increase of $151.3 million, or 6%. The growth in deposits came primarily from core transaction and savings accounts, while higher-cost time deposits decreased.

Other financial highlights are reflected in the following table.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL HIGHLIGHTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in Thousands, Except Per Share Data, Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of or for the

 

 

As of or for the

 

 

 

three months ended

 

 

six months ended

 

 

 

6/30/2021

 

 

3/31/2021

 

 

6/30/2020

 

 

6/30/2021

 

 

6/30/2020

Net income

 

$

11,708

 

 

$

11,078

 

 

$

8,303

 

 

$

22,786

 

 

$

16,110

 

Diluted earnings per share

 

$

0.76

 

 

$

0.72

 

 

$

0.54

 

 

$

1.48

 

 

$

1.05

 

Return on average assets

 

 

1.42

%

 

 

1.40

%

 

 

1.19

%

 

 

1.41

%

 

 

1.21

%

Return on average equity

 

 

13.29

%

 

 

12.94

%

 

 

10.30

%

 

 

13.11

%

 

 

10.14

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin (tax-equivalent)

 

 

3.60

%

 

 

3.93

%

 

 

3.81

%

 

 

3.76

%

 

 

3.97

%

Yield on average loans and leases

 

 

4.57

%

 

 

4.53

%

 

 

4.56

%

 

 

4.55

%

 

 

4.86

%

Cost of average total deposits

 

 

0.09

%

 

 

0.09

%

 

 

0.15

%

 

 

0.09

%

 

 

0.24

%

Efficiency ratio (tax-equivalent)¹

 

 

58.79

%

 

 

56.43

%

 

 

57.78

%

 

 

57.57

%

 

 

58.33

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

3,272,048

 

 

$

3,326,037

 

 

$

3,110,044

 

 

$

3,272,048

 

 

$

3,110,044

 

Loans & leases net of deferred fees

 

$

2,140,961

 

 

$

2,284,751

 

 

$

2,209,480

 

 

$

2,140,961

 

 

$

2,209,480

 

Noninterest demand deposits

 

$

1,073,833

 

 

$

1,020,350

 

 

$

949,662

 

 

$

1,073,833

 

 

$

949,662

 

Total deposits

 

$

2,775,914

 

 

$

2,853,892

 

 

$

2,506,754

 

 

$

2,775,914

 

 

$

2,506,754

 

Noninterest-bearing deposits over total deposits

 

 

38.7

%

 

 

35.8

%

 

 

37.9

%

 

 

38.7

%

 

 

37.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders equity / total assets

 

 

10.9

%

 

 

10.5

%

 

 

10.5

%

 

 

10.9

%

 

 

10.5

%

Tangible common equity ratio

 

 

10.1

%

 

 

9.6

%

 

 

9.6

%

 

 

10.1

%

 

 

9.6

%

Book value per share

 

$

23.21

 

 

$

22.58

 

 

$

21.55

 

 

$

23.21

 

 

$

21.55

 

Tangible book value per share

 

$

21.19

 

 

$

20.54

 

 

$

19.43

 

 

$

21.19

 

 

$

19.43

 

(1) Noninterest expense as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities

INCOME STATEMENT HIGHLIGHTS

Net Interest Income

Net interest income was $27.2 million for the second quarter of 2021, a $3.0 million increase, or 13% over the second quarter of 2020, and increased $7.8 million, or 16% to $55.7 million for the first six months of 2021 relative to the same period in 2020.

For the second quarter of 2021, growth in average interest-earning assets totaled $491.8 million, or 19%, as compared to the second quarter of 2020. The yield on these balances was 29 basis points lower for the same period due mostly to a shift in the mix of earning assets to lower yielding assets and a decline in investment yields. This decrease in yield was partially offset by an 11 basis point drop in the cost of our interest-bearing liabilities for the same period.

Net interest income for the comparative year-to-date periods increased due to a $565.0 million, or 23%, growth in average interest-earning assets. The yield on these average balances was 37 basis points lower for the same period, but was partially offset by a 25 basis point drop in interest paid on liabilities. The net impact of this lower rate was a 21 basis point decrease in our net interest margin for the six-months ending June 30, 2021 as compared to the same period in 2020.

Loan income during the second quarter of 2021 included $1.0 million related to fee income, net of origination costs, recognized on Small Business Administration Paycheck Protection Program (“SBA PPP”) loans. Similarly, SBA PPP loan fees, net of origination costs of $2.4 million were recognized for the six months ended June 30, 2021. At June 30, 2021, approximately $2.4 million of unearned fees, net of origination costs related to SBA PPP loans remains on the balance sheet.

Interest expense was $0.9 million for the second quarter of 2021, a decline of $0.3 million, or 27%, relative to the second quarter of 2020. For the first six months of 2021, compared to the first six months of 2020, interest expense declined $1.7 million, or 49%, to $1.8 million. The significant decline in interest expense is attributable to a favorable shift in deposit mix as higher cost time deposits declined by $62.7 million, or 14%, in the second quarter of 2021 as compared to the second quarter of 2020, and fell by $132.1 million, or 26%, compared to the fourth quarter of 2020, while lower or no cost transaction and savings accounts increased $323.3 million, or 17%, for the second quarter of 2021 compared to the same period in 2020 and increased by $280.6 million, or 14%, over the fourth quarter of 2020.

Our net interest margin was primarily impacted by the additional liquidity from significant deposit growth in 2021 coupled with lower loan balances. This additional liquidity was mostly deployed in overnight funding at an average rate of 11 basis points for the second quarter and six-months ending June 30, 2021. Discount accretion on loans from whole-bank acquisitions enhanced our net interest margin by two basis points in the second quarter of 2021 compared to one basis point in the second quarter of 2020, and by two basis points for the first half of 2021 and for the same period in 2020. On June 30, 2021, the remaining balance of loan discount available to be accreted was $2.8 million. In addition, investment yields have continued to decline given the overall rate environment in 2021. The overall impact of a lower net interest margin was more than offset by higher earning assets in 2021 as compared to 2020.

Provision for Loan and Lease Losses

The Company recorded a net benefit related to loan and lease loss provision of $2.1 million in the second quarter of 2021 relative to a loan and lease loss provision expense of $2.2 million in the second quarter of 2020, and a year-to-date net benefit for loan and lease loss provision of $1.9 million in 2021 as compared to $4.0 million loan and lease loss provision expense for the same period in 2020. The Company’s $4.3 million, or 195%, favorable decline in provision for loan and lease losses in the second quarter of 2021 as compared to the second quarter of 2020, and the $5.9 million favorable decrease, or 146%, in the first six months of 2021 compared to the same period in 2020 is due mostly to lower historical loan loss rates, lower average balances on loans, net recoveries of previously charged-off loan balances, and changes to qualitative factors. Management adjusted its qualitative risk factors under our current incurred loss model for improved economic conditions, improvements in the severity and volume of past due loans, enhancements in the quality of the Company’s loan review system, and a reduction in the level of concentrations of credit in non-owner occupied real estate loans.

The Company was subject to the adoption in the first quarter of 2020 of the Current Expected Credit Loss (“CECL”) accounting method under Financial Accounting Standards Board (FASB) Accounting Standards Update 2016-03 and related amendments, Financial Instruments – Credit Losses (Topic 326). Prior to the close of the first quarter of 2020, the Company elected under Section 4014 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act to defer the implementation of CECL until the earlier of when the national emergency related to the outbreak of COVID-19 ends or December 31, 2020. Later in 2020, the Consolidated Appropriations Act, 2021 extended the deferral of implementation of CECL to the earlier of the first day of the fiscal year, beginning after the national emergency terminates or January 1, 2022. The Company’s decision to defer the adoption of CECL was done primarily to provide additional time to assess better the impact of the COVID-19 pandemic on the expected lifetime credit losses. At the time the decision was made, there was a significant change in economic uncertainty on the local, regional, and national levels as a result of local and state stay-at-home orders, as well as relief measures provided at a national, state, and local level. Further, the Company has taken actions to serve our communities during the pandemic, including permitting short-term payment deferrals to current customers, as well as originating bridge loans and SBA PPP loans.

Noninterest Income

Total noninterest income decreased by $0.3 million, or 4%, for the quarter ended June 30, 2021 as compared to the same quarter in 2020 and increased $0.4 million, or 3%, for the comparable year-to-date periods. The quarterly and year-to-date comparison includes a $0.7 million non-recurring gain resulting from the wrap-up of a low-income housing tax credit fund investment and a $0.4 million gain from the sale of debt securities which occurred in the second quarter of 2020. The year-to-date comparison also reflects a $0.7 million favorable swing in bank-owned life insurance (BOLI) income, resulting from fluctuations in income on BOLI associated with deferred compensation plans and a $0.4 million favorable increase in the valuation of equity securities.

Service charges on customer deposit account income increased by $0.1 million, or 4%, to $2.7 million in the second quarter of 2021 as compared to the second quarter of 2020. This service charge income was $0.3 million lower, or 5%, in the first six months of 2021, as compared to the same period in 2020. These declines in the year-to-date comparison are primarily a result of a net decline in overdraft income partially offset by higher interchange income on debit cards.

Noninterest Expense

Total noninterest expense increased by $2.2 million, or 12%, in the second quarter of 2021 relative to the second quarter of 2020, and by $4.7 million, or 13%, in the first six months of 2021 as compared to the first six months of 2020.

Salaries and Benefits were $1.2 million, or 13%, higher in the second quarter of 2021 as compared to the second quarter of 2020 and $2.1 million, or 11% higher for the first six months of 2021 compared to the same period in 2020. The reason for this increase is primarily due to lower salary expense deferrals related to the decrease in loan originations for both the quarterly and year-to-date comparisons.

Occupancy expenses were $0.1 million higher for the second quarter of 2021 as compared to the same quarter in 2020 and $0.3 million higher for the first half of 2021 as compared to the first half of 2020. The primary reason for this increase was an acceleration of leasehold improvement amortization for two leased branch facilities that were closed during the second quarter. See the discussion of branch closures below.

Other noninterest expense increased $0.9 million, or 15%, for the second quarter 2021 as compared to the second quarter in 2020, and increased $2.2 million, or 19%, for the first half of 2021 as compared to the same period in 2020. The variance for second quarter of 2021 compared to the same period in 2020 was driven an increase of $0.5 million or 45% in data processing costs, due mostly to increases in core processor costs, price increases in loan processing software and additional software to compliment the Company’s digital strategy. We also experienced a $0.2 million increase in data communication costs, a $0.3 million increase in legal costs and a $0.3 million increase in other professional services costs. Other professional services variances include a $0.1 million increase in FDIC assessments, and a $0.1 million increase in deferred compensation expense for directors, which is linked to the changes in BOLI income. For the year-over-year comparison the categories of increase were the same as with the quarterly comparison, along with a $0.4 million increase in check-card processing costs.

The Company’s provision for income taxes was 25.3% of pre-tax income in the second quarter of 2021 relative to 23.2% in the second quarter of 2020, and 25.4% of pre-tax income for the first half of 2021 relative to 23.6% for the same period in 2020. The increase in effective tax rate in the second quarter of 2021 is due to tax credits and tax-exempt income representing a smaller percentage of total taxable income.

As a result of the COVID-19 pandemic, several of our branch lobbies were fully or partially closed throughout the pandemic. All of these branch lobbies have reopened, except for five locations that the Company decided to permanently close in June 2021. This decision to close these branches was made as a result of a change in customer behaviors brought about by the COVID-19 pandemic along with an efficiency review. All of the five closed locations were located outside of the Bank’s primary market area. Customers affected by these branch closures were notified. Many of our customers have found an added convenience and ease of transacting business through online and mobile banking services which precipitated our decision to close locations where in-person transaction volumes no longer warranted a traditional brick-and-mortar branch. The acceleration of amortization of leasehold improvements for these locations increased depreciation expense by $0.4 million in the second quarter of 2021 and by $0.5 million year-to-date 2021. Most of the staff at these five locations were re-located to existing branches with position vacancies, however four individuals elected to leave the Company. It is projected that closing these five branch locations will result in annual noninterest expense savings of between $0.8 and $1.0 million.

Balance Sheet Summary

Balance sheet changes during the first half of 2021 include an increase in total assets of $51.3 million, or 2%, primarily a result of a $302.5 million increase in cash and due from banks, and an increase of $63.5 million, or 12%, in investment securities, net of a $317.7 million decrease in net loan balances.

The decrease in gross loan balances as compared to December 31, 2020 was primarily a result of a $157.3 million decline in mortgage warehouse line utilization. In addition, there was a net decrease of $100.0 million in real estate secured loans, primarily from construction and other commercial real estate loans as the Company strategically lowered its regulatory commercial real estate concentration ratio from 378% at December 31, 2020 to 335% at June 30, 2021. Further, SBA PPP loan forgiveness resulted in a $49.0 million decline in loan balances. The loan pipeline at June 30, 2021 continues to improve as compared to the past two quarters.

Unused commitments, excluding mortgage warehouse and consumer overdraft lines, were $224.8 million at June 30, 2021, compared to $260.0 million at December 31, 2020. Total line utilization, excluding mortgage warehouse and consumer overdraft lines, was 56% at June 30, 2021 and 57% at December 31, 2020. Mortgage warehouse utilization declined significantly to 43% at June 30, 2021, as compared to 71% at December 31, 2020.

The Company participated in the SBA PPP as authorized by the CARES Act. We began accepting and funding loans under this program in April 2020. There were 943 loans for $68.0 million outstanding at June 30, 2021, compared to 1,274 loans for $117.2 million at December 31, 2020. During the second quarter of 2021, the Bank originated, and the SBA approved, funding for $16.1 million in SBA PPP loans while the SBA forgave $45.5 million of SBA PPP loans.

Deposit balances reflect growth of $151.3 million, or 6%, during the first six months of 2021. Core non-maturity deposits increased by $283.4 million, or 13%, while customer time deposits decreased by $117.1 million, or 28%. Wholesale brokered deposits decreased by $15.0 million to $85.0 million. Overall noninterest-bearing deposits as a percent of total deposits at June 30, 2021, increased to 38.7%, as compared to 36.0% at December 31, 2020. Other interest-bearing liabilities of $70.5 million on June 30, 2021 consists exclusively of customer repurchase agreements. Other interest-bearing liabilities at December 31, 2020 of $182.0 million consisted of $100.0 million of fed funds purchased, $39.1 million of customer repurchase agreements, $37.9 million of FHLB overnight borrowings and $5.0 million of FHLB short term borrowings.

The Company continues to have substantial liquidity. At June 30, 2021, and December 31, 2020, the Company had the following sources of primary and secondary liquidity (Dollars in Thousands):

 

 

 

 

 

 

 

Primary and secondary liquidity sources

 

 

June 30, 2021

 

 

December 31, 2020

Cash and cash equivalents

 

$

373,902

 

$

71,417

Unpledged investment securities

 

 

482,039

 

 

311,983

Excess pledged securities

 

 

44,262

 

 

52,892

FHLB borrowing availability

 

 

662,641

 

 

535,404

Unsecured lines of credit

 

 

305,000

 

 

230,000

Funds available through fed discount window

 

 

62,897

 

 

58,127

Totals

 

$

1,930,741

 

$

1,259,823

Total capital of $357.7 million at June 30, 2021 reflects an increase of $13.8 million, or 4%, relative to year-end 2020. The increase in equity during the first half of 2021 was due to the addition of $22.8 million in net income, offset by a $3.0 million unfavorable swing in accumulated other comprehensive income/loss, and net of $6.5 million in dividends paid. The remaining difference is related to stock options exercised during the quarter. The Company executed no share repurchases during the first half of 2021.

Asset Quality

Total nonperforming assets, comprised of nonaccrual loans and foreclosed assets, decreased by $0.5 million to $8.1 million for the first half of 2021. The Company’s ratio of nonperforming loans to gross loans increased to 0.34% at June 30, 2021 from 0.31% at December 31, 2020; this was due to a decrease in the gross loan and lease portfolio, since nonperforming loans decreased $0.3 million during the same period. All of the Company’s impaired assets are periodically reviewed and are either well-reserved based on current loss expectations or are carried at the fair value of the underlying collateral, net of expected disposition costs.

The Company’s allowance for loan and lease losses was $16.4 million at June 30, 2021, as compared to a balance of $17.7 million at December 31, 2020 and $13.6 million at June 30, 2020. The allowance was 0.77% of total loans at June 30, 2021, and 0.72% at December 31, 2020 and 0.61% at June 30, 2020.

The $1.3 million decrease in the allowance for loan and lease losses during the first half of the year resulted from the $1.9 million benefit associated with loan and lease loss provision combined with net loan recoveries of previously charged off loan balances for $0.5 million. For further information regarding the Company’s decision to defer the implementation of CECL under Section 4014 of the CARES Act, as well as further detail on the decrease in loan and lease loss provision during the second quarter and first half of 2021, please see the discussion above under Provision for Loan and Lease Losses.

Management’s detailed analysis indicates that the Company’s allowance for loan and lease losses should be sufficient to cover credit losses inherent in loan and lease balances outstanding as of June 30, 2021, but no assurance can be given that the Company will not experience substantial future losses relative to the size of the loan and lease loss allowance.

The Company provided loan modification deferrals to customers under Section 4013 of the CARES Act, which are not treated as troubled debt restructured loans. As of June 30, 2021, we had three remaining loans for two customer relationships totaling $10.4 million. All of these loans are fully secured by real estate collateral. We expect all customers to show an ability and willingness to pay full principal and interest payments upon maturity of their deferment periods.

About Sierra Bancorp

Sierra Bancorp is the holding company for Bank of the Sierra (www.bankofthesierra.com), which is in its 44th year of operations and is the largest independent bank headquartered in the South San Joaquin Valley. Bank of the Sierra is a community-centric regional bank, which offers a broad range of retail and commercial banking services through full-service branches located within the counties of Tulare, Kern, Kings, Fresno, Ventura, San Luis Obispo and Santa Barbara. The Bank also maintains an online branch and provides specialized lending services through an agricultural credit center, an SBA center and a dedicated loan production office in Roseville, California. In 2021, Bank of the Sierra was recognized as one of the strongest and top-performing community banks in the country, with a 5‑star rating from Bauer Financial.

Forward-Looking Statements

The statements contained in this release that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future de­velopments and their potential effects on the Company. Readers are cautioned not to unduly rely on forward looking statements. Actual results may differ from those projected. These forward-looking statements involve risks and uncertainties including but not limited to the health of the national and local economies, the Company’s ability to attract and retain skilled employees, customers’ service expectations, the Company’s ability to successfully de­ploy new technology, the success of acquisitions and branch expansion, changes in interest rates, loan portfolio performance, and other factors detailed in the Company’s SEC filings, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recent Form 10‑K and Form 10‑Q.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

STATEMENT OF CONDITION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in Thousands, Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

6/30/2021

 

 

3/31/2021

 

 

12/31/2020

 

 

9/30/2020

 

 

6/30/2020

Cash and due from banks

 

$

373,902

 

 

$

346,211

 

 

$

71,417

 

 

$

88,933

 

 

$

156,611

 

Investment securities

 

 

607,474

 

 

 

552,931

 

 

 

543,974

 

 

 

577,278

 

 

 

599,333

 

Real estate loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-4 family residential construction

 

 

37,165

 

 

 

36,818

 

 

 

48,565

 

 

 

75,532

 

 

 

89,225

 

Other construction/land

 

 

27,682

 

 

 

50,433

 

 

 

71,980

 

 

 

83,797

 

 

 

90,545

 

1-4 family – closed-end

 

 

106,599

 

 

 

126,949

 

 

 

139,836

 

 

 

162,022

 

 

 

178,071

 

Equity lines

 

 

33,334

 

 

 

36,276

 

 

 

38,075

 

 

 

38,620

 

 

 

44,318

 

Multi-family residential

 

 

58,230

 

 

 

58,324

 

 

 

61,865

 

 

 

61,740

 

 

 

55,921

 

Commercial real estate – owner occupied

 

 

359,021

 

 

 

359,777

 

 

 

343,199

 

 

 

328,832

 

 

 

313,863

 

Commercial real estate – non-owner occupied

 

 

1,048,153

 

 

 

1,071,532

 

 

 

1,062,498

 

 

 

945,374

 

 

 

691,292

 

Farmland

 

 

125,783

 

 

 

126,157

 

 

 

129,905

 

 

 

127,964

 

 

 

134,454

 

Total real estate loans

 

 

1,795,967

 

 

 

1,866,266

 

 

 

1,895,923

 

 

 

1,823,881

 

 

 

1,597,689

 

Agricultural production loans

 

 

42,952

 

 

 

45,476

 

 

 

44,872

 

 

 

45,782

 

 

 

48,516

 

Commercial and industrial

 

 

150,632

 

 

 

183,762

 

 

 

209,048

 

 

 

217,224

 

 

 

221,502

 

Mortgage warehouse lines

 

 

150,351

 

 

 

187,940

 

 

 

307,679

 

 

 

287,516

 

 

 

338,124

 

Consumer loans

 

 

4,894

 

 

 

5,024

 

 

 

5,589

 

 

 

5,897

 

 

 

6,266

 

Gross loans and leases

 

 

2,144,796

 

 

 

2,288,468

 

 

 

2,463,111

 

 

 

2,380,300

 

 

 

2,212,097

 

Deferred loan and lease fees

 

 

(3,835

)

 

 

(3,717

)

 

 

(3,147

)

 

 

(3,078

)

 

 

(2,617

)

Allowance for loan and lease losses

 

 

(16,421

)

 

 

(18,319

)

 

 

(17,738

)

 

 

(15,586

)

 

 

(13,560

)

Net loans and leases

 

 

2,124,540

 

 

 

2,266,432

 

 

 

2,442,226

 

 

 

2,361,636

 

 

 

2,195,920

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bank premises and equipment

 

 

25,949

 

 

 

26,795

 

 

 

27,505

 

 

 

27,216

 

 

 

27,779

 

Other assets

 

 

140,183

 

 

 

133,668

 

 

 

135,620

 

 

 

144,555

 

 

 

130,401

 

Total assets

 

$

3,272,048

 

 

$

3,326,037

 

 

$

3,220,742

 

 

$

3,199,618

 

 

$

3,110,044

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND CAPITAL

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest demand deposits

 

$

1,073,833

 

 

$

1,020,350

 

 

$

943,664

 

 

$

975,750

 

 

$

949,662

 

Interest-bearing transaction accounts

 

 

752,137

 

 

 

770,271

 

 

 

668,346

 

 

 

656,922

 

 

 

641,815

 

Savings deposits

 

 

435,076

 

 

 

415,230

 

 

 

368,420

 

 

 

361,857

 

 

 

346,262

 

Money market deposits

 

 

133,977

 

 

 

136,653

 

 

 

131,232

 

 

 

126,918

 

 

 

125,420

 

Customer time deposits

 

 

295,891

 

 

 

411,388

 

 

 

412,944

 

 

 

420,266

 

 

 

433,595

 

Wholesale brokered deposits

 

 

85,000

 

 

 

100,000

 

 

 

100,000

 

 

 

50,000

 

 

 

10,000

 

Total deposits

 

 

2,775,914

 

 

 

2,853,892

 

 

 

2,624,606

 

 

 

2,591,713

 

 

 

2,506,754

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Junior subordinated debentures

 

 

35,213

 

 

 

35,169

 

 

 

35,124

 

 

 

35,079

 

 

 

35,035

 

Other interest-bearing liabilities

 

 

70,535

 

 

 

56,527

 

 

 

182,038

 

 

 

194,657

 

 

 

204,449

 

Total deposits and interest-bearing liabilities

 

 

2,881,662

 

 

 

2,945,588

 

 

 

2,841,768

 

 

 

2,821,449

 

 

 

2,746,238

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other liabilities

 

 

32,657

 

 

 

32,468

 

 

 

35,078

 

 

 

41,922

 

 

 

36,373

 

Total capital

 

 

357,729

 

 

 

347,981

 

 

 

343,896

 

 

 

336,247

 

 

 

327,433

 

Total liabilities and capital

 

$

3,272,048

 

 

$

3,326,037

 

 

$

3,220,742

 

 

$

3,199,618

 

 

$

3,110,044

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GOODWILL AND INTANGIBLE ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in Thousands, Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6/30/2021

 

 

3/31/2021

 

 

12/31/2020

 

 

9/30/2020

 

 

6/30/2020

Goodwill

 

$

27,357

 

 

$

27,357

 

 

$

27,357

 

 

$

27,357

 

 

$

27,357

 

Core deposit intangible

 

 

3,780

 

 

 

4,038

 

 

 

4,307

 

 

 

4,575

 

 

 

4,844

 

Total intangible assets

 

$

31,137

 

 

$

31,395

 

 

$

31,664

 

 

$

31,932

 

 

$

32,201

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CREDIT QUALITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in Thousands, Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6/30/2021

 

 

3/31/2021

 

 

12/31/2020

 

 

9/30/2020

 

 

6/30/2020

Non-accruing loans

 

$

7,276

 

 

$

8,599

 

 

$

7,598

 

 

$

7,186

 

 

$

5,808

 

Foreclosed assets

 

 

774

 

 

 

945

 

 

 

971

 

 

 

2,970

 

 

 

2,893

 

Total nonperforming assets

 

$

8,050

 

 

$

9,544

 

 

$

8,569

 

 

$

10,156

 

 

$

8,701

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performing TDR’s (not included in NPA’s)

 

$

10,774

 

 

$

10,596

 

 

$

11,382

 

 

$

7,708

 

 

$

9,192

 

Net (recoveries) / charge offs

 

$

(533

)

 

$

(331

)

 

$

735

 

 

$

687

 

 

$

363

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Past due & still accruing (30-89)

 

$

3,197

 

 

$

2,991

 

 

$

1,656

 

 

$

7,201

 

 

$

2,333

 

Loans deferred under CARES Act

 

$

10,411

 

 

$

22,437

 

 

$

29,500

 

 

$

405,858

 

 

$

386,243

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing loans to gross loans

 

 

0.34

%

 

 

0.38

%

 

 

0.31

%

 

 

0.30

%

 

 

0.26

%

NPA’s to loans plus foreclosed assets

 

 

0.38

%

 

 

0.42

%

 

 

0.35

%

 

 

0.43

%

 

 

0.39

%

Allowance for loan and lease losses to loans

 

 

0.77

%

 

 

0.80

%

 

 

0.72

%

 

 

0.65

%

 

 

0.61

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SELECT PERIOD-END STATISTICS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6/30/2021

 

 

3/31/2021

 

 

12/31/2020

 

 

9/30/2020

 

 

6/30/2020

Shareholders equity / total assets

 

 

10.9

%

 

 

10.5

%

 

 

10.7

%

 

 

10.5

%

 

 

10.5

%

Gross loans / deposits

 

 

77.3

%

 

 

80.2

%

 

 

93.8

%

 

 

91.8

%

 

 

88.2

%

Non-interest bearing deposits / total deposits

 

 

38.7

%

 

 

35.8

%

 

 

36.0

%

 

 

37.6

%

 

 

37.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONSOLIDATED INCOME STATEMENT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in Thousands, Unaudited)

 

 

For the three months ended:

 

 

For the six months ended:

 

 

 

6/30/2021

 

 

3/31/2021

 

 

6/30/2020

 

 

6/30/2021

 

 

6/30/2020

Interest income

 

$

28,092

 

 

$

29,458

 

$

25,385

 

$

57,550

 

 

$

51,437

Interest expense

 

 

903

 

 

 

903

 

 

1,243

 

 

1,806

 

 

 

3,508

Net interest income

 

 

27,189

 

 

 

28,555

 

 

24,142

 

 

55,744

 

 

 

47,929

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Benefit) / provision for loan and lease losses

 

 

(2,100

)

 

 

250

 

 

2,200

 

 

(1,850

)

 

 

4,000

Net interest income after provision

 

 

29,289

 

 

 

28,305

 

 

21,942

 

 

57,594

 

 

 

43,929

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges

 

 

2,725

 

 

 

2,767

 

 

2,618

 

 

5,491

 

 

 

5,802

BOLI income

 

 

814

 

 

 

583

 

 

649

 

 

1,397

 

 

 

687

Other noninterest income

 

 

3,073

 

 

 

3,480

 

 

3,243

 

 

6,554

 

 

 

6,128

Total noninterest income

 

 

6,612

 

 

 

6,830

 

 

6,900

 

 

13,442

 

 

 

13,007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

 

10,425

 

 

 

11,151

 

 

9,266

 

 

21,576

 

 

 

19,438

Occupancy expense

 

 

2,626

 

 

 

2,486

 

 

2,504

 

 

5,112

 

 

 

4,832

Other noninterest expenses

 

 

7,184

 

 

 

6,634

 

 

6,263

 

 

13,818

 

 

 

11,581

Total noninterest expense

 

 

20,235

 

 

 

20,271

 

 

18,033

 

 

40,506

 

 

 

35,851

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before taxes

 

 

15,666

 

 

 

14,864

 

 

10,809

 

 

30,530

 

 

 

21,085

Provision for income taxes

 

 

3,958

 

 

 

3,786

 

 

2,506

 

 

7,744

 

 

 

4,975

Net income

 

$

11,708

 

 

$

11,078

 

$

8,303

 

$

22,786

 

 

$

16,110

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TAX DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tax-exempt muni income

 

$

1,517

 

 

$

1,449

 

$

1,440

 

$

2,967

 

 

$

2,778

Interest income – fully tax equivalent

 

$

28,495

 

 

$

29,843

 

$

25,768

 

$

58,339

 

 

$

52,175

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PER SHARE DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

For the three months ended:

 

 

For the six months ended:

 

 

 

6/30/2021

 

 

3/31/2021

 

 

6/30/2020

 

 

6/30/2021

 

 

6/30/2020

Basic earnings per share

 

$

0.77

 

 

$

0.73

 

 

$

0.55

 

 

$

1.49

 

 

$

1.06

 

Diluted earnings per share

 

$

0.76

 

 

$

0.72

 

 

$

0.54

 

 

$

1.48

 

 

$

1.05

 

Common dividends

 

$

0.21

 

 

$

0.21

 

 

$

0.20

 

 

$

0.42

 

 

$

0.40

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

15,243,698

 

 

 

15,223,010

 

 

 

15,191,823

 

 

 

15,242,451

 

 

 

15,226,748

 

Weighted average diluted shares

 

 

15,375,825

 

 

 

15,337,710

 

 

 

15,237,655

 

 

 

15,365,966

 

 

 

15,288,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per basic share (EOP)

 

$

23.21

 

 

$

22.58

 

 

$

21.55

 

 

$

23.21

 

 

$

21.55

 

Tangible book value per share (EOP)

 

$

21.19

 

 

$

20.54

 

 

$

19.43

 

 

$

21.19

 

 

$

19.43

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding (EOP)

 

 

15,410,763

 

 

 

15,410,763

 

 

 

15,192,838

 

 

 

15,410,763

 

 

 

15,192,838

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

KEY FINANCIAL RATIOS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

For the three months ended:

 

 

For the six months ended:

 

 

 

6/30/2021

 

 

3/31/2021

 

 

6/30/2020

 

 

6/30/2021

 

 

6/30/2020

Return on average equity

 

 

13.29

%

 

 

12.94

%

 

 

10.30

%

 

 

13.11

%

 

 

10.14

%

Return on average assets

 

 

1.42

%

 

 

1.40

%

 

 

1.19

%

 

 

1.41

%

 

 

1.21

%

Net interest margin (tax-equivalent)

 

 

3.60

%

 

 

3.93

%

 

 

3.81

%

 

 

3.76

%

 

 

3.97

%

Efficiency ratio (tax-equivalent)¹

 

 

58.79

%

 

 

56.43

%

 

 

57.78

%

 

 

57.57

%

 

 

58.33

%

Net (recoveries) charge offs to avg loans (not annualized)

 

 

(0.01

)%

 

 

(0.01

)%

 

 

0.00

%

 

 

(0.02

)%

 

 

0.02

%

(1) Noninterest expense as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NONINTEREST INCOME/EXPENSE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in Thousands, Unaudited)

 

 

 

 

 

 

 

 

For the three months ended:

 

 

For the six months ended:

Noninterest income:

 

 

6/30/2021

 

 

3/31/2021

 

 

6/30/2020

 

 

6/30/2021

 

6/30/2020

Service charges on deposit accounts

 

$

2,725

 

 

$

2,767

 

 

$

2,618

 

 

$

5,491

 

 

$

5,802

 

Other service charges and fees

 

 

3,050

 

 

 

2,560

 

 

 

2,503

 

 

 

5,611

 

 

 

4,907

 

Net gains on sale of securities available-for-sale

 

 

 

 

 

 

 

 

390

 

 

 

 

 

 

390

 

Bank-owned life insurance

 

 

814

 

 

 

583

 

 

 

649

 

 

 

1,397

 

 

 

687

 

Other

 

 

23

 

 

 

920

 

 

 

740

 

 

 

943

 

 

 

1,221

 

Total noninterest income

 

$

6,612

 

 

$

6,830

 

 

$

6,900

 

 

$

13,442

 

 

$

13,007

 

As a % of average interest earning assets (1)

 

 

0.86

%

 

 

0.93

%

 

 

1.07

%

 

 

0.89

%

 

 

1.06

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

$

10,425

 

 

$

11,151

 

 

$

9,266

 

 

$

21,576

 

 

$

19,438

 

Occupancy costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Furniture & equipment

 

 

453

 

 

 

452

 

 

 

619

 

 

 

905

 

 

 

1,084

 

Premises

 

 

2,173

 

 

 

2,034

 

 

 

1,885

 

 

 

4,207

 

 

 

3,748

 

Advertising and marketing costs

 

 

292

 

 

 

321

 

 

 

425

 

 

 

612

 

 

 

1,026

 

Data processing costs

 

 

1,513

 

 

 

1,426

 

 

 

1,045

 

 

 

2,939

 

 

 

2,187

 

Deposit services costs

 

 

2,282

 

 

 

2,068

 

 

 

2,229

 

 

 

4,350

 

 

 

4,025

 

Loan services costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan processing

 

 

65

 

 

 

169

 

 

 

191

 

 

 

234

 

 

 

362

 

Foreclosed assets

 

 

(10

)

 

 

107

 

 

 

62

 

 

 

98

 

 

 

68

 

Other operating costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Telephone & data communications

 

 

668

 

 

 

380

 

 

 

467

 

 

 

1,048

 

 

 

835

 

Postage & mail

 

 

109

 

 

 

84

 

 

 

106

 

 

 

193

 

 

 

174

 

Other

 

 

337

 

 

 

462

 

 

 

365

 

 

 

799

 

 

 

751

 

Professional services costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Legal & accounting

 

 

682

 

 

 

442

 

 

 

357

 

 

 

1,125

 

 

 

685

 

Other professional service

 

 

1,004

 

 

 

897

 

 

 

701

 

 

 

1,899

 

 

 

947

 

Stationery & supply costs

 

 

73

 

 

 

78

 

 

 

131

 

 

 

151

 

 

 

246

 

Sundry & tellers

 

 

169

 

 

 

200

 

 

 

184

 

 

 

370

 

 

 

275

 

Total noninterest expense

 

$

20,235

 

 

$

20,271

 

 

$

18,033

 

 

$

40,506

 

 

$

35,851

 

As a % of average interest earning assets (1)

 

 

2.64

%

 

 

2.75

%

 

 

2.80

%

 

 

2.68

%

 

 

2.94

%

Efficiency ratio (2)(3)

 

 

58.79

%

 

 

56.43

%

 

 

57.78

%

 

 

57.58

%

 

 

58.33

%


(1) Annualized

(2) Tax equivalent

(3) Noninterest expense as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities and bank owned life insurance income.

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCES AND RATES

 

 

 

 

 

 

 

 

(Dollars in Thousands, Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the quarter ended

 

For the quarter ended

 

For the quarter ended

 

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

 

 

Average

Balance (1)

Income

/ Expense

Yield/

Rate (2)

 

Average

Balance (1)

Income/

Expense

Yield/

Rate (2)

 

Average

Balance (1)

Income/

Expense

Yield/

Rate (2)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning due from banks

 

$

308,453

$

85

0.11

%

 

$

76,504

$

19

0.10

%

 

$

53,209

$

12

0.09

%

Taxable

 

 

340,690

 

1,573

1.85

%

 

 

317,254

 

1,578

2.02

%

 

 

403,517

 

2,250

2.24

%

Non-taxable

 

 

243,461

 

1,517

3.16

%

 

 

226,838

 

1,449

3.28

%

 

 

216,746

 

1,440

3.38

%

Total investments

 

 

892,604

 

3,175

1.61

%

 

 

620,596

 

3,046

2.24

%

 

 

673,472

 

3,702

2.44

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and leases: (3)

 

 

 

 

 

 

 

 

 

 

 

 

Real estate

 

 

1,825,600

 

21,015

4.62

%

 

 

1,879,359

 

21,391

4.62

%

 

 

1,477,380

 

18,355

5.00

%

Agricultural production

 

 

43,959

 

408

3.72

%

 

 

46,153

 

419

3.68

%

 

 

47,806

 

452

3.80

%

Commercial

 

 

166,554

 

2,124

5.12

%

 

 

191,656

 

2,451

5.19

%

 

 

170,876

 

1,080

2.54

%

Consumer

 

 

4,978

 

193

15.55

%

 

 

5,422

 

196

14.66

%

 

 

6,667

 

225

13.57

%

Mortgage warehouse lines

 

 

142,348

 

1,151

3.24

%

 

 

242,865

 

1,928

3.22

%

 

 

206,669

 

1,532

2.98

%

Other

 

 

1,460

 

26

7.14

%

 

 

1,588

 

27

6.90

%

 

 

2,811

 

39

5.58

%

Total loans and leases

 

 

2,184,899

 

24,917

4.57

%

 

 

2,367,043

 

26,412

4.53

%

 

 

1,912,209

 

21,683

4.56

%

Total interest earning assets (4)

 

 

3,077,503

$

28,092

3.71

%

 

 

2,987,639

$

29,458

4.05

%

 

 

2,585,681

$

25,385

4.01

%

Other earning assets

 

 

15,438

 

 

 

 

13,275

 

 

 

 

13,190

 

 

Non-earning assets

 

 

209,218

 

 

 

 

201,114

 

 

 

 

207,623

 

 

Total assets

 

$

3,302,159

 

 

 

$

3,202,028

 

 

 

$

2,806,494

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and shareholders’ equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

$

161,871

$

91

0.23

%

 

$

130,763

$

73

0.23

%

 

$

134,159

$

71

0.21

%

NOW

 

 

601,339

 

116

0.08

%

 

 

569,171

 

101

0.07

%

 

 

481,679

 

83

0.07

%

Savings accounts

 

 

424,512

 

59

0.06

%

 

 

391,091

 

53

0.05

%

 

 

327,833

 

46

0.06

%

Money market

 

 

139,336

 

30

0.09

%

 

 

136,422

 

30

0.09

%

 

 

125,594

 

31

0.10

%

Time deposits

 

 

337,270

 

262

0.30

%

 

 

412,416

 

289

0.29

%

 

 

442,762

 

625

0.57

%

Wholesale brokered deposits

 

 

92,418

 

61

0.26

%

 

 

100,000

 

62

0.25

%

 

 

19,890

 

37

0.75

%

Total interest bearing deposits

 

 

1,756,746

 

619

0.14

%

 

 

1,739,863

 

608

0.14

%

 

 

1,531,917

 

893

0.23

%

Borrowed funds:

 

 

 

 

 

 

 

 

 

 

 

 

Junior subordinated debentures

 

 

35,185

 

245

2.79

%

 

 

35,141

 

247

2.85

%

 

 

35,009

 

311

3.57

%

Other interest-bearing liabilities

 

 

61,186

 

39

0.26

%

 

 

63,449

 

48

0.31

%

 

 

45,936

 

39

0.34

%

Total borrowed funds

 

 

96,371

 

284

1.18

%

 

 

98,590

 

295

1.21

%

 

 

80,945

 

350

1.74

%

Total interest bearing liabilities

 

 

1,853,117

 

903

0.20

%

 

 

1,838,453

$

903

0.20

%

 

 

1,612,862

 

1,243

0.31

%

Demand deposits – noninterest bearing

 

 

1,052,494

 

 

 

 

977,137

 

 

 

 

830,333

 

 

Other liabilities

 

 

43,095

 

 

 

 

39,199

 

 

 

 

39,155

 

 

Shareholders’ equity

 

 

353,453

 

 

 

 

347,239

 

 

 

 

324,144

 

 

Total liabilities and shareholders’ equity

 

$

3,302,159

 

 

 

$

3,202,028

 

 

 

$

2,806,494

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income/interest earning assets

 

 

 

3.71

%

 

 

 

4.05

%

 

 

 

4.01

%

Interest expense/interest earning assets

 

 

 

0.11

%

 

 

 

0.12

%

 

 

 

0.20

%

Net interest income and margin (5)

 

 

$

27,189

3.60

%

 

 

$

28,555

3.93

%

 

 

$

24,142

3.81

%

 


(1) Average balances are obtained from the best available daily or monthly data and are net of deferred fees and related direct costs.

(2) Yields and net interest margin have been computed on a tax equivalent basis utilizing a 21% effective tax rate.

(3) Loans are gross of the allowance for possible loan losses. Loan fees have been included in the calculation of interest income. Net loan fees and loan acquisition FMV amortization were $1.0 million and $(0.2) million for the quarters ended June 30, 2021 and 2020, respectively, and $1.4 million for the quarter ended March 31, 2021.

(4) Non-accrual loans have been included in total loans for purposes of computing total earning assets.

(5) Net interest margin represents net interest income as a percentage of average interest-earning assets.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCES AND RATES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in Thousands, Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the six months ended

 

 

For the six months ended

 

 

June 30, 2021

 

 

June 30, 2020

 

 

Average

Balance (1)

 

Income/

Expense

 

Yield/

Rate (2)

 

Average

Balance (1)

 

Income/

Expense

 

Yield/

Rate (2)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning due from banks

 

$

193,120

 

$

104

 

0.11

%

 

$

45,166

 

$

153

 

0.68

%

Taxable

 

 

329,029

 

 

3,150

 

1.93

%

 

 

406,054

 

 

4,710

 

2.33

%

Non-taxable

 

 

235,204

 

 

2,967

 

3.22

%

 

 

206,218

 

 

2,778

 

3.42

%

Total investments

 

 

757,353

 

 

6,221

 

1.87

%

 

 

657,438

 

 

7,641

 

2.56

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and leases:(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate

 

 

1,852,330

 

 

42,407

 

4.62

%

 

 

1,436,145

 

 

37,079

 

5.19

%

Agricultural

 

 

45,050

 

 

827

 

3.70

%

 

 

48,169

 

 

1,035

 

4.32

%

Commercial

 

 

179,036

 

 

4,575

 

5.15

%

 

 

139,287

 

 

2,176

 

3.14

%

Consumer

 

 

5,199

 

 

389

 

15.09

%

 

 

7,124

 

 

593

 

16.74

%

Mortgage warehouse lines

 

 

192,329

 

 

3,078

 

3.23

%

 

 

175,645

 

 

2,797

 

3.20

%

Other

 

 

1,523

 

 

53

 

7.02

%

 

 

4,027

 

 

116

 

5.79

%

Total loans and leases

 

 

2,275,467

 

 

51,329

 

4.55

%

 

 

1,810,397

 

 

43,796

 

4.86

%

Total interest earning assets (4)

 

 

3,032,820

 

 

57,550

 

3.88

%

 

 

2,467,835

 

 

51,437

 

4.25

%

Other earning assets

 

 

14,363

 

 

 

 

 

 

 

13,015

 

 

 

 

 

Non-earning assets

 

 

205,187

 

 

 

 

 

 

 

202,265

 

 

 

 

 

Total assets

 

$

3,252,370

 

 

 

 

 

 

$

2,683,115

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and shareholders’ equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

$

146,403

 

$

164

 

0.23

%

 

$

111,445

 

$

134

 

0.24

%

NOW

 

 

585,344

 

 

217

 

0.07

%

 

 

469,133

 

 

205

 

0.09

%

Savings accounts

 

 

407,894

 

 

112

 

0.06

%

 

 

312,777

 

 

119

 

0.08

%

Money market

 

 

137,887

 

 

60

 

0.09

%

 

 

121,421

 

 

74

 

0.12

%

Time deposites

 

 

374,636

 

 

551

 

0.30

%

 

 

451,656

 

 

1,991

 

0.89

%

Brokered deposits

 

 

96,188

 

 

123

 

0.26

%

 

 

30,357

 

 

204

 

1.35

%

Total interest bearing deposits

 

 

1,748,352

 

 

1,227

 

0.14

%

 

 

1,496,789

 

 

2,727

 

0.37

%

Borrowed funds:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Junior subordinated debentures

 

 

35,164

 

 

493

 

2.83

%

 

 

34,986

 

 

706

 

4.06

%

Other interest-bearing liabilities

 

 

62,312

 

 

86

 

0.28

%

 

 

39,684

 

 

75

 

0.38

%

Total borrowed funds

 

 

97,476

 

 

579

 

1.20

%

 

 

74,670

 

 

781

 

2.10

%

Total interest bearing liabilities

 

 

1,845,828

 

 

1,806

 

0.20

%

 

 

1,571,459

 

 

3,508

 

0.45

%

Demand deposits – noninterest bearing

 

 

1,015,023

 

 

 

 

 

 

 

754,463

 

 

 

 

 

Other liabilities

 

 

41,156

 

 

 

 

 

 

 

37,687

 

 

 

 

 

Shareholders’ equity

 

 

350,363

 

 

 

 

 

 

 

319,506

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

3,252,370

 

 

 

 

 

 

$

2,683,115

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income/interest earning assets

 

 

 

 

 

 

 

3.88

%

 

 

 

 

 

 

 

4.25

%

Interest expense/interest earning assets

 

 

 

 

 

 

 

0.12

%

 

 

 

 

 

 

 

0.28

%

Net interest income and margin(5)

 

 

 

 

$

55,744

 

3.76

%

 

 

 

 

$

47,929

 

3.97

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


(1) Average balances are obtained from the best available daily or monthly data and are net of deferred fees and related direct costs.

(2) Yields and net interest margin have been computed on a tax equivalent basis utilizing a 21% effective tax rate.

(3) Loans are gross of the allowance for possible loan losses. Loan fees have been included in the calculation of interest income. Net loan fees and loan acquisition FMV amortization were $2,402 thousand and $(377) thousand for the six months ended June 30, 2021 and 2020, respectively.

(4) Non-accrual loans have been included in total loans for purposes of computing total earning assets.

(5) Net interest margin represents net interest income as a percentage of average interest-earning assets.

Category: Financial

Source: Sierra Bancorp

Contacts

Kevin McPhaill, President/CEO

(559) 782‑4900 or (888) 454‑BANK

www.sierrabancorp.com

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