Alpine Banks of Colorado announces financial results for fourth quarter and year-end 2022

Rhea-AI Summary

Alpine Banks of Colorado (OTCQX: ALPIB) reported its fourth quarter and annual results for 2022, showing a net income of $20.7 million for Q4, and $73.4 million for the year. Basic earnings per Class A share decreased 9.2% in Q4 but increased 20.0% for the year. Loan growth was 4.1% in Q4 and 15.0% for the year, with total loans reaching $3.9 billion. The net interest margin improved to 3.69% in Q4 2022 compared to 3.49% in Q3 2022. Total assets rose to $6.3 billion. Total deposits decreased by 2.6% in Q4 but saw only a 1.6% annual decline. The company continues to maintain a strong capital position.

Positive

• Net income for Q4 2022 was $20.7 million, a solid figure despite a quarterly decline.
• Total assets increased to $6.3 billion, reflecting organic growth.
• Net interest margin improved to 3.69%, indicating effective management of interest income.

Negative

• Basic earnings per Class A common share decreased 9.2% in Q4 2022.
• Total deposits fell 2.6% in Q4 2022, which could indicate liquidity concerns.

GLENWOOD SPRINGS, Colo., Jan. 30, 2023 (GLOBE NEWSWIRE) -- Alpine Banks of Colorado (OTCQX: ALPIB) (“Alpine” or the “Company”), the holding company for Alpine Bank (the “Bank”), today announced results (unaudited) for the fourth quarter and year ended December 31, 2022. The Company reported net income of $20.7 million, or $189.29 per basic Class A common share, and $1.26 per basic Class B common share, for fourth quarter 2022, and net income of $73.4 million, or $695.78 per basic Class A common share and $4.64 per basic Class B common share, for the year ended December 31, 2022.

Highlights in fourth quarter 2022, and the year ended December 31, 2022 include:

• Basic earnings per Class A common share decreased 9.2%, or $19.20, during fourth quarter 2022.
• Basic earnings per Class A common share increased 20.0%, or $116.15, during the 12 months ended December 31, 2022.
• Basic earnings per Class B common share decreased 9.2%, or $0.13, during fourth quarter 2022.
• Basic earnings per Class B common share increased 20.0%, or $0.77, during the 12 months ended December 31, 2022.
• Loan growth during fourth quarter 2022 was 4.1%, or $154.2 million.
• Loan growth during the 12 months ended December 31, 2022 was 15.0%, or $508.0 million.
• Net interest margin for the fourth quarter 2022 was 3.69%, compared to 3.49% in the preceding quarter, and 3.34% in the fourth quarter 2021.
  

“The fourth quarter of 2022 capped off a record year of earnings. Strong loan growth and increased interest rates combined to elevate the earnings power of the Company,” said Alpine Banks of Colorado President and Vice Chairman Glen Jammaron. “As we kick off our 51^st year of operations we look forward to the challenges and opportunities that await the Alpine team. On January 12^th we welcomed Alison Vollbracht Winfield to our board of directors. Alison is the daughter of our late co-founder Bill Vollbracht. Renewed representation from the Vollbracht family on the board cements the legacy of our founders well into the future.”

Net income
Net income for fourth quarter 2022 and third quarter 2022 was $20.7 million and $22.4 million, respectively. Interest income increased $5.8 million in fourth quarter 2022 compared to third quarter 2022, primarily due to an increase in volume in the loan portfolio and increases in yields on the loan portfolio, the securities portfolio and balances due from banks. This increase was slightly offset by decreases in volume in the securities portfolio and balances due from banks. Interest expense increased $2.3 million in fourth quarter 2022 compared to third quarter 2022, primarily due an increase in volume in borrowings and increases in costs on the Company’s trust preferred securities, other borrowings and deposits slightly offset by a decrease in volume of deposits. Noninterest income decreased $2.0 million in fourth quarter 2022 compared to third quarter 2022, due to decreases in other income and service charges on deposit accounts. This decrease was slightly offset by an increase on earnings on bank-owned life insurance. Noninterest expense increased $2.0 million in fourth quarter 2022 compared to third quarter 2022, due to increases in salaries and employee benefits expenses, other expenses and occupancy expenses, slightly offset by a decrease in furniture and fixture expenses. A provision for loan losses of $2.6 million was recorded in fourth quarter 2022 due to increased loan amounts compared to no provision for loan losses in third quarter 2022.

Net income for the 12 months ended December 31, 2022 and December 31, 2021 was $73.4 million and $59.6 million, respectively. Interest income increased $32.8 million in the 12 months of 2022 compared to the 12 months of 2021, primarily due to increases in volume in the securities and loan portfolios and increases in yields in balances due from banks, the loan and securities portfolios. This increase was slightly offset by a decrease in volume in balances due from banks. Interest expense increased $3.1 million in the 12 months of 2022 compared to the 12 months of 2021, primarily due to increases in costs on the Company’s trust preferred securities, other borrowings and cost of deposits, along with increases in volume in other borrowings and deposits. Noninterest income decreased $6.5 million in the 12 months of 2022 compared to the 12 months of 2021, primarily due to realized losses on the sale of the Bank’s equity investment in a bond fund and decreases in income from the Bank’s mortgage banking activities. This decrease was slightly offset by increases in service charges on deposit accounts, fee income, and earnings on life insurance. Noninterest expense increased $10.5 million in the 12 months of 2022 compared to the 12 months of 2021, due to increases in other expenses, salary and employee benefit expenses, furniture and fixtures expenses, and occupancy expenses. Provision for loan losses decreased $2.6 million in the 12 months of 2022 compared to the 12 months of 2021, primarily due to asset quality improvement during 2022.

Net interest margin increased from 3.49% to 3.69% from third quarter 2022 to fourth quarter 2022. Net interest margin for the 12 months ended December 31, 2022 and December 31, 2021 was 3.34% and 3.09%, respectively.

Assets
Total assets increased $48.7 million, or 0.8%, to $6.3 billion as of December 31, 2022 compared to September 30, 2022, primarily due to organic loan growth. Total assets grew $98.6 million, or 1.6%, from December 31, 2021 to December 31, 2022. The Alpine Bank Wealth Management* division had assets under management of $1.10 billion on December 31, 2022, compared to $1.15 billion on December 31, 2021, a decrease of 4.5%.

Loans
Loans outstanding as of December 31, 2022 totaled $3.9 billion. The loan portfolio increased $154.2 million, or 4.1%, during fourth quarter 2022 compared to September 30, 2022. This growth was driven by a $78.5 million increase in residential real estate loans, a $50.7 million increase in commercial real estate loans, a $29.3 million increase in real estate construction loans, a $1.3 million increase in consumer loans and a $0.2 million increase in other loans. This increase was slightly offset by a $5.1 million decrease in commercial and industrial loans.

Loans outstanding as of December 31, 2022 reflected an increase of $508.0 million, or 15.0%, compared to loans outstanding of $3.4 billion on December 31, 2021. This growth was driven by a $291.8 million increase in residential real estate loans, a $134.6 million increase in real estate construction loans, a $123.4 million increase in commercial real estate loans, and a $2.1 million increase in consumer loans. This year-over-year growth was slightly offset by a $42.4 million decrease in commercial and industrial loans.

Deposits
Total deposits decreased $148.6 million, or 2.6%, to $5.5 billion during fourth quarter 2022 compared to September 30, 2022, primarily due to a $134.9 million decrease in demand accounts, a $56.9 million decrease in money fund accounts and a $47.3 million decrease in interest-bearing checking accounts. This decrease was partially offset by a $1.3 million increase in savings accounts, and a $89.3 million increase in certificate of deposit accounts.

Total deposits of $5.5 billion on December 31, 2022 reflected a decrease of $89.2 million, or 1.6%, compared to total deposits of $5.6 billion on December 31, 2021. This decrease was due to a $111.6 million decrease in money fund accounts, a $63.3 million decrease in demand deposits and a $9.9 million decrease in interest-bearing checking accounts, slightly offset by a $8.2 million increase in savings accounts and a $87.5 million increase in certificate of deposit accounts. Brokered certificates of deposit totaled $74.6 million on December 31, 2022.

Capital
The Bank continues to be designated as a “well capitalized” institution as its capital ratios exceed the minimum requirements for this designation. As of December 31, 2022, the Bank’s Tier 1 Leverage Ratio was 9.19%, Tier 1 Risk-Based Capital Ratio was 13.12% and Total Risk-Based Capital Ratio was 14.09%. On a consolidated basis, the Company’s Tier 1 Leverage Ratio was 8.75%, Tier 1 Risk-Based Capital Ratio was 12.48% and Total Risk-Based Capital Ratio was 14.57% as of December 31, 2022.

Book value per share on December 31, 2022 was $3,891.00 per Class A common share and $25.94 per Class B common share, an increase of $178.80 per Class A common share and $1.19 per Class B common share from September 30, 2022.

Dividends
During fourth quarter 2022, Alpine paid cash dividends of $27.00 per Class A common share and $0.18 per Class B common share. On January 12, 2023, Alpine declared cash dividends of $30.00 per Class A common share and $0.20 per Class B common share, payable on January 30, 2023 to shareholders of record on January 23, 2023.

About Alpine Banks of Colorado
Alpine Banks of Colorado, through its wholly owned subsidiary Alpine Bank, is a $6.3 billion, employee-owned organization founded in 1973 with headquarters in Glenwood Springs, Colorado. With banking offices across Colorado’s Western Slope, mountains and Front Range, Alpine Bank employs 800 people and serves 170,000 customers with personal, business, wealth management*, mortgage and electronic banking services. Alpine Bank has a 5-star rating – meaning it has earned a superior performance classification – from BauerFinancial, an independent organization that analyzes and rates financial institutions’ performance in the United States. Shares of the Class B nonvoting common stock of Alpine Banks of Colorado trade under the symbol “ALPIB" on the OTCQX^® Best Market. Learn more at www.alpinebank.com.

*Alpine Bank Wealth Management services are not FDIC insured, may lose value and are not guaranteed by the Bank.

Contacts:	Glen Jammaron	Eric A. Gardey
	President and Vice Chairman	Chief Financial Officer
	Alpine Banks of Colorado	Alpine Banks of Colorado
	2200 Grand Avenue	2200 Grand Avenue
	Glenwood Springs, CO 81601	Glenwood Springs, CO 81601
	(970) 384-3266	(970) 384-3257

A note about forward-looking statements
This press release contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “reflects”, “believes,” “estimates,” “expects” and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements we make regarding our evaluation of macro-environment risks, Federal Reserve rate management, and trends reflecting things such as regulatory capital standards and adequacy. Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. We caution you therefore against relying on any of these forward-looking statements. They are neither statements of historical fact or guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statement include, but are not limited to:

• The ability to attract new deposits and loans;
• Demand for financial services in our market areas;
• Competitive market-pricing factors;
• Changes in assumptions underlying the establishment of allowances for loan losses and other estimate;
• Effects of future economic, business and market conditions, including higher inflation;
• Adverse effects of public health events, such as the COVID-19 pandemic, including governmental and societal responses;
• Deterioration in economic conditions that could result in increased loan losses;
• Actions by competitors and other market participants that could have an adverse impact on our expected performance;
• Risks associated with concentrations in real estate-related loans;
• Risks inherent in making loans, such as repayment risks and fluctuating collateral values;
• Market interest rate volatility, including changes to the federal funds rate;
• Stability of funding sources and continued availability of borrowings;
• Risk associated with potential cyber threats;
• Changes in legal or regulatory requirements or the results of regulatory examinations that could restrict growth;
• The ability to recruit and retain key management and staff;
• The ability to raise capital or incur debt on reasonable terms; and
• Effectiveness of legislation and regulatory efforts to help the U.S. and global financial markets.
  

There are many factors that could cause actual results to differ materially from those contemplated by forward-looking statements. Any forward-looking statement made by us in this press release or in any subsequent written or oral statements attributable to the Company are expressly qualified in their entirety by the cautionary statements above. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Key Financial Measures
The tables in the links below highlight Alpine’s key financial measures for the periods indicated (unaudited).

Key Financial Measures 12/31/2022

Statement of Income 12/31/2022

Statement of Financial Condition 12/31/2022

Statement of Comprehensive Income 12/31/2022

Contact:	Eric A. Gardey, Chief Financial Officer
	Alpine Banks of Colorado
	(970) 384-3257
	ericgardey@alpinebank.com

FAQ

What were the earnings results for ALPIB in Q4 2022?

Alpine Banks of Colorado reported net income of $20.7 million for Q4 2022.

How did ALPIB perform in 2022 compared to 2021?

Alpine's net income for 2022 was $73.4 million, up from $59.6 million in 2021.

What is the current net interest margin for ALPIB?

The net interest margin for Alpine Banks increased to 3.69% in Q4 2022.

How much did loans grow for ALPIB in 2022?

Loans grew by 15.0% in 2022, reaching a total of $3.9 billion.

What changes did ALPIB see in total deposits?

Total deposits decreased by 2.6% in Q4 2022, totaling $5.5 billion.