Blue Ridge Bankshares, Inc. Announces Second Quarter and First Half 2022 Results

Rhea-AI Summary

Blue Ridge Bankshares, Inc. (BRBS) reported a net income of $1.1 million for Q2 2022, a significant decline from $17.4 million in Q1 2022 and $28.7 million in Q2 2021. This drop is attributed to $9.4 million in fair value adjustments of equity investments and decreased income from the mortgage division, which reported $406 thousand net income in Q2 2022. Total assets rose to $2.80 billion, while loans held for investment grew to $2.05 billion, showing a 30.5% annualized growth rate. The company remains cautious amid macroeconomic headwinds.

Positive

• Total assets increased to $2.80 billion as of June 30, 2022, up from $2.67 billion at year-end 2021.
• Loans held for investment, excluding PPP loans, grew $271.2 million in the first half of 2022, indicating a 30.5% annualized growth rate.
• Deposits related to fintech partnerships increased to approximately $395 million from $189 million at year-end 2021.

Negative

• Net income fell to $1.1 million in Q2 2022, down from $17.4 million in Q1 2022 and $28.7 million in Q2 2021.
• Mortgage division net income dropped significantly to $406 thousand in Q2 2022, compared to $2.3 million in Q1 2022.
• A provision for loan losses was recorded at $7.5 million in Q2 2022, up from $2.5 million in Q1 2022.

CHARLOTTESVILLE, Va., July 28, 2022 /PRNewswire/ -- Blue Ridge Bankshares, Inc. (the "Company") (NYSE American: BRBS), the holding company of Blue Ridge Bank, National Association ("Blue Ridge Bank") and BRB Financial Group, Inc. ("BRB Financial Group"), announced today financial results for the quarter and year-to-date periods ended June 30, 2022. For the second quarter of 2022, the Company reported net income from continuing operations of $1.1 million, or $0.06 earnings per diluted common share, compared to $17.4 million, or $0.93 earnings per diluted common share, for the first quarter of 2022, and $28.7 million, or $1.54 earnings per diluted common share, for the second quarter of 2021. For the six months ended June 30, 2022, the Company reported net income from continuing operations of $18.5 million, or $0.99 earnings per diluted common share, compared to $32.9 million, or $1.95 earnings per diluted common share, for the same period of 2021. Net income in the second quarter of 2021 included an after-tax gain of $19.2 million resulting from the sale of Paycheck Protection Program ("PPP") loans.

Net income from continuing operations before income taxes and provision for loan losses was $9.0 million for the second quarter of 2022 compared to $25.1 million for the first quarter of 2022. The decrease in these amounts for the consecutive quarter periods was primarily due to $9.4 million of fair value adjustments related to the Company's equity investments in certain fintech companies recorded in the first quarter of 2022 and the decline in income from the Company's mortgage division, which was $3.6 million less in the second quarter period.

The Company reported total assets of $2.80 billion as of June 30, 2022, an increase from $2.67 billion as of December 31, 2021, while reported loans held for investment, excluding PPP loans, grew $271.2 million in the first half of 2022, an annualized growth rate of 30.5%. Of this loan growth, $205.0 million occurred in the second quarter.

In the first quarter of 2022, the Company sold its majority interest in MoneyWise Payroll Solutions, Inc. ("MoneyWise") to the holder of the minority interest in MoneyWise. Asset and liability balances and income statement amounts related to MoneyWise are reported as discontinued operations for all periods presented.

The Company completed the merger of Bay Banks of Virginia, Inc. ("Bay Banks"), the holding company of Virginia Commonwealth Bank, into the Company on January 31, 2021. Immediately following the completion of the merger, Virginia Commonwealth Bank was merged into Blue Ridge Bank. Earnings for the first quarter and year-to-date periods ended June 30, 2021, included the earnings of Bay Banks from the effective date of the merger.

"The Company continues to experience strong loan demand, as evidenced by the year-to-date growth in the held-for-investment loan portfolio of 15%", said Brian K. Plum, President and Chief Executive Officer of the Company. "Over half of 2022 second quarter loan growth occurred in the last two weeks in the quarter, so the Company recorded additional provision funding without experiencing the full related interest income lift in the quarter. This impact, combined with expenses associated with building our middle market team and adding to our fintech operational, risk, and compliance teams, had a negative impact on this quarter's earnings."

"We remain mindful of macroeconomic headwinds and the impacts of a potential slowdown," Plum continued. "Our team is working hard to generate quality relationships with loan and deposit pricing that incorporates rate increases and the current yield curve environment."

Fintech Business

The Company's fintech partnerships include Unit, Flexible Finance, Increase, Upgrade, Kashable, Jaris, Grow Credit, MentorWorks, Aeldra, and Marlette. Deposits related to fintech relationships were approximately $395 million as of June 30, 2022, up from approximately $189 million as of December 31, 2021. Loans held for sale and loans held for investment related to fintech relationships totaled $25.6 million and $24.1 million as of June 30, 2022 and December 31, 2021, respectively. Interest and fee income related to fintech partnerships represented approximately $1.8 million and $1.3 million of revenue for the Company for the second and first quarters of 2022, respectively. The Company's fintech relationships also generated assets under management of $55.9 million in BRB Financial Group's Trust Division as of June 30, 2022. The Company continues to grow its infrastructure to support the expansion of its fintech partners.

Mortgage Division

The Company's mortgage division, which consists of a retail division operating as Monarch Mortgage and a wholesale division operating as LenderSelect Mortgage Group, reported net income of $406 thousand and $2.3 million for the second and first quarters of 2022, respectively. Income attributable to mortgage servicing rights was $1.6 million for the second quarter of 2022 compared to $6.7 million for the first quarter of 2022. Higher income from mortgage servicing rights in the first quarter of 2022 was primarily due to the impact of greater longer-term interest rate increases in this period. Mortgage servicing rights income in the second and first quarters of 2022 was attributable to fair value adjustments of $(229) thousand and $3.8 million, respectively, and new servicing rights retained of $1.8 million and $2.9 million, respectively. Residential mortgage banking income increased by $1.6 million in the second quarter of 2022 when compared to the first quarter of 2022, primarily due to the impact of hedging activities as production slowed in the first quarter of 2022. Quarterly mortgage volumes declined to $117.8 million for the second quarter of 2022 compared to $151.4 million for the first quarter of 2022, primarily attributable to declining demand in the increasing interest rate environment. Noninterest expenses reported for the Company's mortgage division were $5.7 million and $6.9 million for the second and first quarters of 2022, respectively. The Company reduced mortgage personnel beginning in the fourth quarter of 2021 and throughout the first half of 2022, resulting in total annualized noninterest expense savings of approximately $2.0 million, the full benefit of which is expected to begin in the second half of 2022.

Income Statement

Net Interest Income

Net interest income was $24.1 million for the second quarter of 2022 compared to $23.7 million for the first quarter of 2021 and $30.5 million for the second quarter of 2021, while accretion of acquired loan discounts included in interest income was $1.3 million, $2.7 million, and $865 thousand for the same respective periods. Amortization of purchase accounting adjustments on assumed time deposits and borrowings, which reduced interest expense, was $499 thousand, $502 thousand, and $1.0 million for the same respective periods. Interest income in the second quarter of 2022, excluding accretion, benefited from higher yields on loans held for investment, while deposit costs decreased slightly compared to the first quarter of 2022.

Included in interest income for the second and first quarters of 2022 and the second quarter of 2021 were $64 thousand, $393 thousand, and $11.7 million, respectively, of PPP loan interest income and fees, net of costs. PPP loans were partially funded through the PPP Liquidity Facility ("PPPLF"), offered by the Federal Reserve Banks to fund PPP loans, and interest expense incurred for the PPPLF was $100 thousand, $14 thousand, and $382 thousand for the second and first quarters of 2022 and the second quarter of 2021, respectively. Cost of funds was 0.36% for both the second and first quarters of 2022 and 0.43% for the second quarter of 2021, while cost of deposits was 0.26%, 0.27%, and 0.29% for the same respective periods.

Net interest margin for the second and first quarters of 2022 was 3.89% and 3.88%, respectively, compared to 3.82% for second quarter of 2021. Accretion and amortization of purchase accounting adjustments had a 29, 53, and 22 basis point positive effect on net interest margin for the same respective periods. In addition, interest and fee income from PPP loans, including the corresponding funding, had a 4, 2, and 55 basis point positive effect on net interest margin for the second and first quarters of 2022 and the second quarter of 2021, respectively.

Net interest income was $47.8 million and $50.5 million for the first halves of 2022 and 2021, respectively, while net interest margin was 3.88% and 3.66% for the same respective periods. Accretion and amortization of purchase accounting adjustments and the contributions from PPP loans, including the corresponding funding, had a cumulative 40 and 56 basis point positive effect on net interest margin for the six months ended June 30, 2022 and 2021, respectively.

Provision for Loan Losses

The Company recorded a provision for loan losses of $7.5 million in the second quarter of 2022 compared to $2.5 million first quarter of 2022 and no provision in the second quarter of 2021. Provision for loan losses for the first halves of 2022 and 2021 was $10.0 million and $0, respectively. Provision for loan losses in the 2022 periods was primarily attributable to reserves for significant loan growth, greater qualitative factor adjustments due to changes in economic conditions, and higher specific reserves for impaired loans.

Noninterest Income

Noninterest income for the second and first quarters of 2022 was $10.2 million and $24.1 million, respectively, compared to $36.2 million for the second quarter of 2021. Noninterest income for the first quarter of 2022 included $9.4 million of fair value adjustments for the Company's equity investments, primarily in certain fintech companies, while noninterest income in the second quarter of 2021 included a $24.3 million net gain on the sale of PPP loans. Mortgage banking income, including mortgage servicing rights, contributed $6.0 million, $9.6 million, and $9.0 million of noninterest income in the second and first quarters of 2022 and the second quarter of 2021, respectively.

Noninterest income for the first halves of 2022 and 2021 was $34.3 million and $51.8 million, respectively. Excluding the fair value adjustments for the Company's equity investments in the first half of 2022 and the net gain on the sale of the PPP loans in the first half of 2021, noninterest income for the respective periods was $25.0 million and $27.4 million, a decline of $2.4 million. This decline was primarily attributable to lower mortgage banking income, including mortgage servicing rights, of $6.1 million, partially offset by a higher gain on sales of government guaranteed loans, higher fee income related to the Company's fintech partnerships, and a net gain on the sale of a former branch location in the first quarter of 2022.

Noninterest Expense 

Noninterest expense for the second and first quarters of 2022 was $25.3 million and $22.7 million, respectively, compared to $30.3 million for the second quarter of 2021. Salaries and employee benefit expenses increased $1.8 million in the second quarter of 2022 from the first quarter of 2022, primarily due to the addition of commercial lenders and personnel to support the fintech business, partially offset by lower expenses attributable to the mortgage division. Noninterest expenses in the second quarter of 2021 included greater incentive expense attributable to the PPP loan program and merger-related expenses of $1.2 million compared to $0 and $50 thousand for the second and first quarters of 2022, respectively.

Noninterest expense for the first halves of 2022 and 2021 was $48.0 million and $60.6 million, respectively. Excluding merger-related expenses, noninterest expense was $48.0 million and $50.3 million for the same respective periods.

Balance Sheet

Loans held for investment, excluding PPP loans, increased $271.2 million to $2.05 billion at June 30, 2022, from $1.78 billion at December 31, 2021, an annualized growth rate of 30.5%. Of this first half 2022 growth, $205.0 million occurred in the second quarter. The Company's middle market and specialized lending teams, which began building in the first quarter of 2022, contributed to this second quarter loan growth.

Loans held for sale, which was comprised primarily of residential mortgages, decreased $89.2 million to $32.8 million at June 30, 2022, from $121.9 million at December 31, 2021, primarily attributable to lower mortgage activity, due to the reasons noted previously.

Total deposits at June 30, 2022, were $2.34 billion, an increase of $37.9 million from December 31, 2021. Noninterest-bearing demand deposit growth was $80.0 million in the first half of 2022, primarily due to the Company's fintech partnerships. Noninterest-bearing demand deposit accounts represented 33.6% and 30.7% of total deposits as of June 30, 2022 and December 31, 2021, respectively.

Asset Quality

Nonperforming loans, which include nonaccrual loans and loans 90 days or more past due and accruing interest¹, totaled $12.2 million at June 30, 2022 and $16.1 million at December 31, 2021. The ratio of nonperforming loans to total assets was 0.44% and 0.60% at June 30, 2022, and December 31, 2021, respectively. The Company's allowance for loan losses was $17.2 million at June 30, 2022, or 0.84% as a percentage of gross loans held for investment, excluding PPP loans², compared to 0.68% at December 31, 2021, and 0.76% at June 30, 2021. The increase in this ratio from December 31, 2021 to June 30, 2022, was primarily attributable to additional allowance for loan growth in the first half of 2022 and greater qualitative factor adjustments, as noted previously. Remaining acquired loan discounts related to loans acquired in the Company's completed mergers were $12.2 million as of June 30, 2022, and $16.2 million as of December 31, 2021.

¹ Excludes purchased credit-impaired loans.

² The Company holds no allowance for loan losses on PPP loans as they are fully guaranteed by the U.S. government.

Capital

The Company previously announced that on July 7, 2022, its board of directors declared a $0.1225 per common share quarterly dividend, payable July 29, 2022, to shareholders of record as of July 18, 2022. Tangible book value per share, a non-GAAP (defined below) measure, was $12.21 and $13.01 as of June 30, 2022 and December 31, 2021, respectively, while book value per share was $13.95 and $14.76 as of the same respective periods.

Primarily as a result of an increase in market interest rates in the first half of 2022, the fair value of the Company's portfolio of securities available for sale declined approximately $42.8 million, resulting in an after-tax decline in stockholders' equity of $33.8 million for the six months ended June 30, 2022. The accumulated other comprehensive loss ("AOCL") attributable to this securities portfolio as of June 30, 2022, was $37.5 million, or $2.00 in book value per share, compared to a $3.6 million AOCL, or $0.19 in book value per share, as of December 31, 2021.

Non-GAAP Financial Measures

The accounting and reporting policies of the Company conform to U.S. generally accepted accounting principles ("GAAP") and prevailing practices in the banking industry. However, management uses certain non-GAAP measures to supplement the evaluation of the Company's performance. Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company's core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of GAAP to non-GAAP measures are included at the end of this release.

Forward-Looking Statements

This release of the Company contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections, and statements of the Company's beliefs concerning future events, business plans, objectives, expected operating results and the assumptions upon which those statements are based. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate, or imply future results, performance or achievements, and are typically identified with words such as "may," "could," "should," "will," "would," "believe," "anticipate," "estimate," "expect," "aim," "intend," "plan," or words or phases of similar meaning.  The Company cautions that the forward-looking statements are based largely on its expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond the Company's control. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements.

The following factors, among others, could cause the Company's financial performance to differ materially from that expressed in such forward-looking statements: (i) the strength of the United States economy in general and the strength of the local economies in which the Company conducts operations; (ii) geopolitical conditions, including acts or threats of terrorism and/or military conflicts, or actions taken by the United States or other governments in response to acts or threats of terrorism and/or military conflicts, which could impact business and economic conditions in the United States and abroad; (iii) the effects of the COVID-19 pandemic, including the adverse impact on the Company's business and operations and on the Company's customers which may result, among other things, in increased delinquencies, defaults, foreclosures and losses on loans; (iv) the occurrence of significant natural disasters, including severe weather conditions, floods, health related issues, and other catastrophic events; (v) the Company's management of risks inherent in its real estate loan portfolio, and the risk of a prolonged downturn in the real estate market, which could impair the value of the Company's collateral and its ability to sell collateral upon any foreclosure; (vi) changes in consumer spending and savings habits; (vii) technological and social media changes; (viii) the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System, inflation, interest rate, market and monetary fluctuations; (ix) changing bank regulatory conditions, policies or programs, whether arising as new legislation or regulatory initiatives, that could lead to restrictions on activities of banks generally, or the Company's subsidiary bank in particular, more restrictive regulatory capital requirements, increased costs, including deposit insurance premiums, regulation or prohibition of certain income producing activities or changes in the secondary market for loans and other products; (x) the impact of changes in financial services policies, laws and regulations, including laws, regulations and policies concerning taxes, banking, securities and insurance, and the application thereof by regulatory bodies; (xi) the impact of changes in laws, regulations and policies affecting the real estate industry; (xii) the effect of changes in accounting policies and practices, as may be adopted from time to time by bank regulatory agencies, the Securities and Exchange Commission (the "SEC"), the Public Company Accounting Oversight Board, the Financial Accounting Standards Board or other accounting standards setting bodies; (xiii) the timely development of competitive new products and services and the acceptance of these products and services by new and existing customers; (xiv) the willingness of users to substitute competitors' products and services for the Company's products and services; (xv) the outcome of any legal proceedings that may be instituted against the Company; (xvi) reputational risk and potential adverse reactions of the Company's customers, suppliers, employees or other business partners; (xvii) the effects of acquisitions the Company may make, including, without limitation, the failure to achieve the expected revenue growth and/or expense savings from such transactions; (xviii) changes in the level of the Company's nonperforming assets and charge-offs; (xix) the Company's involvement, from time to time, in legal proceedings and examination and remedial actions by regulators; (xx) potential exposure to fraud, negligence, computer theft and cyber-crime; (xxi) the Company's ability to pay dividends; (xxii) the Company's involvement as a participating lender in the PPP as administered through the U.S. Small Business Administration; and (xiii) other risks and factors identified in the "Risk Factors" sections and elsewhere in documents the Company files from time to time with the SEC.

 

Blue Ridge Bankshares, Inc.
Consolidated Statements of Income (unaudited)
		For the Three Months Ended
(Dollars in thousands except per share data)		June 30, 2022		March 31, 2022		June 30, 2021
Interest income:
Interest and fees on loans		$            23,787		$               23,899		$            32,591
Interest on taxable securities		2,129		1,770		1,133
Interest on nontaxable securities		89		75		64
Interest on deposit accounts and federal funds sold		238		58		24
Total interest income		26,243		25,802		33,812
Interest expense:
Interest on deposits		1,541		1,556		1,682
Interest on subordinated notes		545		553		868
Interest on FHLB and FRB borrowings		67		25		800
Total interest expense		2,153		2,134		3,350
Net interest income		24,090		23,668		30,462
Provision for loan losses		7,494		2,500		—
Net interest income after provision for loan losses		16,596		21,168		30,462
Noninterest income:
Fair value adjustments of other equity investments		(86)		9,364		—
Mortgage servicing rights		1,574		6,738		1,707
Residential mortgage banking income, net		4,386		2,821		7,254
Gain on sale of government guaranteed loans		1,538		1,427		143
Bank and purchase card, net		599		422		299
Wealth and trust management		414		391		833
Service charges on deposit accounts		327		315		370
Increase in cash surrender value of bank owned life insurance		276		272		237
Gain on sale of PPP loans		—		—		24,315
Other		1,162		2,344		1,054
Total noninterest income		10,190		24,094		36,212
Noninterest expense:
Salaries and employee benefits		15,873		14,096		17,539
Occupancy and equipment		1,500		1,485		1,846
Data processing		874		946		1,484
Legal, issuer, and regulatory filing		618		382		489
Advertising and marketing		412		428		238
Communications		1,030		799		672
Audit and accounting fees		379		141		291
FDIC insurance		106		231		9
Intangible amortization		386		397		457
Other contractual services		999		534		666
Other taxes and assessments		671		570		1,076
Merger-related		—		50		1,237
Other		2,478		2,630		4,262
Total noninterest expense		25,326		22,689		30,266
Income from continuing operations before income tax		1,460		22,573		36,408
Income tax expense		342		5,153		7,715
Net income from continuing operations		1,118		17,420		28,693
Discontinued operations:
Income (loss) from discontinued operations before income taxes (including gain on disposal of $471 thousand for the three months ended June 30, 2022)		—		426		(65)
Income tax expense (benefit)		—		89		(14)
Net income (loss) from discontinued operations		—		337		(51)
Net income		$              1,118		$               17,757		$            28,642
Net (income) loss from discontinued operations attributable to noncontrolling interest		—		(1)		4
Net income attributable to Blue Ridge Bankshares, Inc.		$              1,118		$               17,756		$            28,646
Net income available to common stockholders		$              1,118		$               17,756		$            28,646
Basic and diluted EPS from continuing operations		$                0.06		$                   0.93		$                1.54
Basic and diluted EPS from discontinued operations		—		0.02		—
Basic and diluted EPS attributable to Blue Ridge Bankshares, Inc.		$                0.06		$                   0.95		$                1.54

 

Blue Ridge Bankshares, Inc.
Consolidated Statements of Income (unaudited)
		For the Six Months Ended
(Dollars in thousands except per share data)		June 30, 2022		June 30, 2021
Interest income:
Interest and fees on loans		$            47,686		$            53,954
Interest on taxable securities		3,899		2,263
Interest on nontaxable securities		164		116
Interest on deposit accounts and federal funds sold		296		55
Total interest income		52,045		56,388
Interest expense:
Interest on deposits		3,097		3,222
Interest on subordinated notes		1,098		1,498
Interest on FHLB and FRB borrowings		92		1,189
Total interest expense		4,287		5,909
Net interest income		47,758		50,479
Provision for loan losses		9,994		—
Net interest income after provision for loan losses		37,764		50,479
Noninterest income:
Fair value adjustments of other equity investments		9,278		—
Mortgage servicing rights		8,312		5,078
Residential mortgage banking income, net		7,207		16,555
Gain on sale of government guaranteed loans		2,965		1,217
Bank and purchase card, net		1,021		599
Wealth and trust management		805		1,435
Service charges on deposit accounts		642		697
Increase in cash surrender value of bank owned life insurance		548		401
Gain on sale of PPP loans		—		24,315
Other		3,506		1,454
Total noninterest income		34,284		51,751
Noninterest expense:
Salaries and employee benefits		29,969		31,442
Occupancy and equipment		2,985		3,177
Data processing		1,820		2,289
Legal, issuer, and regulatory filing		1,000		1,065
Advertising and marketing		840		517
Communications		1,829		1,039
Audit and accounting fees		520		480
FDIC insurance		337		352
Intangible amortization		783		906
Other contractual services		1,533		1,519
Other taxes and assessments		1,241		1,423
Merger-related		50		10,256
Other		5,108		6,134
Total noninterest expense		48,015		60,599
Income from continuing operations before income tax		24,033		41,653
Income tax expense		5,495		8,717
Net income from continuing operations		18,538		32,936
Discontinued operations:
Income (loss) from discontinued operations before income taxes (including gain on disposal of $471 thousand for the six months ended June 30, 2022)		426		(72)
Income tax expense (benefit)		89		(15)
Net income (loss) from discontinued operations		337		(57)
Net income		$            18,875		$            32,879
Net income from discontinued operations attributable to noncontrolling interest		(1)		(5)
Net income attributable to Blue Ridge Bankshares, Inc.		$            18,874		$            32,874
Net income available to common stockholders		$            18,874		$            32,874
Basic and diluted EPS from continuing operations		$                0.99		$                1.95
Basic and diluted EPS from discontinued operations		0.02		—
Basic and diluted EPS attributable to Blue Ridge Bankshares, Inc.		$                1.01		$                1.95

 

Blue Ridge Bankshares, Inc.
Consolidated Balance Sheets
(Dollars in thousands except share data)		(unaudited) June 30, 2022		December 31, 2021 (1)
Assets
Cash and due from banks		$            75,192		$         130,548
Federal funds sold		35,493		43,903
Securities available for sale, at fair value		381,536		373,532
Restricted equity investments		13,072		8,334
Other equity investments		23,773		14,184
Other investments		17,110		12,681
Loans held for sale		32,759		121,943
Paycheck Protection Program loans, net of deferred fees and costs		15,654		30,406
Loans held for investment, net of deferred fees and costs		2,048,383		1,777,172
Less allowance for loan losses		(17,242)		(12,121)
Loans held for investment, net		2,031,141		1,765,051
Accrued interest receivable		8,908		9,573
Other real estate owned		74		157
Premises and equipment, net		24,273		26,624
Right-of-use asset		6,332		6,317
Bank owned life insurance		47,100		46,545
Goodwill		26,826		26,826
Other intangible assets		7,349		7,594
Mortgage derivative asset		937		1,876
Mortgage servicing rights, net		29,265		16,469
Mortgage brokerage receivable		733		4,064
Other assets		22,116		17,211
Assets of discontinued operations		—		1,301
Total assets		$       2,799,643		$      2,665,139
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand		$          785,743		$         706,088
Interest-bearing demand and money market deposits		1,007,420		941,805
Savings		150,030		150,376
Time deposits		392,514		499,502
Total deposits		2,335,707		2,297,771
FHLB borrowings		135,000		10,111
FRB borrowings		60		17,901
Subordinated notes, net		39,953		39,986
Lease liability		7,537		7,651
Other liabilities		19,726		14,543
Liabilities of discontinued operations		—		37
Total liabilities		2,537,983		2,388,000
Commitments and contingencies
Stockholders' Equity:
Common stock, no par value; 50,000,000 and 25,000,000 shares authorized at June 30, 2022 and December 31, 2021, respectively; 18,761,848 and 18,774,082 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively		195,053		194,309
Additional paid-in capital		252		252
Retained earnings		103,846		85,982
Accumulated other comprehensive loss		(37,491)		(3,632)
Total Blue Ridge Bankshares, Inc. stockholders' equity		261,660		276,911
Noncontrolling interest of discontinued operations		—		228
Total stockholders' equity		261,660		277,139
Total liabilities and stockholders' equity		$       2,799,643		$      2,665,139
(1) Derived from audited December 31, 2021 Consolidated Financial Statements.

 

Blue Ridge Bankshares, Inc.
Quarter Summary of Selected Financial Data (unaudited)
		As of and for the Three Months Ended
(Dollars and shares in thousands, except share data)		June 30,		March 31,		December 31,		September 30,		June 30,
Income Statement Data:		2022		2022		2021		2021		2021
Interest income		$       26,243		$       25,802		$         23,404		$           23,754		$       33,812
Interest expense		2,153		2,134		2,526		2,630		3,350
Net interest income		24,090		23,668		20,878		21,124		30,462
Provision for loan losses		7,494		2,500		117		—		—
Net interest income after provision for loan losses		16,596		21,168		20,761		21,124		30,462
Noninterest income		10,190		24,094		21,942		13,295		36,212
Noninterest expenses		25,326		22,689		25,143		25,344		30,266
Income before income taxes		1,460		22,573		17,560		9,075		36,408
Income tax expense		342		5,153		4,733		2,214		7,711
Net income from continuing operations		1,118		17,420		12,827		6,861		28,697
Net income (loss) from discontinued operations		—		337		(32)		(55)		(55)
Net income		1,118		17,757		12,795		6,806		28,642
Net (income) loss from discontinued operations attributable to noncontrolling interest		—		(1)		(2)		4		4
Net income attributable to Blue Ridge Bankshares, Inc.		$         1,118		$       17,756		$         12,793		$             6,810		$       28,646
Per Common Share Data:
Basic and diluted EPS from continuing operations		$           0.06		$           0.93		$             0.68		$               0.36		$           1.54
Basic and diluted EPS from discontinued operations		—		0.02		—		—		—
Basic and diluted EPS attributable to Blue Ridge Bankshares, Inc.		$           0.06		$           0.95		0.68		0.36		$           1.54
Dividends declared - post-stock split basis		$       0.1255		$       0.1225		$                —		$           0.2400		$              —
Book value per common share		13.95		14.84		14.76		14.48		14.32
Tangible book value per common share - Non-GAAP		12.21		13.09		13.01		12.69		12.49
Balance Sheet Data:
Assets		$  2,799,643		$  2,724,584		$    2,665,139		$      2,699,302		$  2,764,730
Loans held for investment (including PPP loans)		2,064,037		1,866,197		1,807,578		1,771,531		1,832,847
Loans held for investment (excluding PPP loans)		2,048,383		1,843,344		1,777,172		1,724,883		1,702,654
Allowance for loan losses		17,242		12,013		12,121		12,614		13,007
Purchase accounting adjustments (discounts) on acquired loans		12,192		13,514		16,203		16,985		16,987
Loans held for sale		32,759		41,004		121,943		171,681		174,008
Securities available for sale, at fair value		381,536		375,484		373,532		379,441		276,619
Deposits		2,335,707		2,354,081		2,297,771		2,200,204		2,190,571
Subordinated notes, net		39,953		39,970		39,986		40,503		46,149
FHLB and FRB advances		135,060		25,319		28,012		158,972		222,502
Total stockholders' equity		261,660		278,482		277,139		269,720		266,826
Weighted average common shares outstanding - basic		18,767		18,772		18,774		18,776		18,625
Weighted average common shares outstanding - diluted		18,778		18,789		18,795		18,799		18,646
Financial Ratios:
Return on average assets (1)		0.17 %		2.68 %		1.90 %		0.95 %		3.39 %
Operating return on average assets (1) - Non-GAAP		0.17 %		2.68 %		1.92 %		1.16 %		3.50 %
Return on average equity (1)		1.57 %		25.84 %		18.90 %		11.58 %		47.39 %
Operating return on average equity (1) - Non-GAAP		1.57 %		25.89 %		19.10 %		11.87 %		49.01 %
Total loan to deposit ratio		89.8 %		81.0 %		84.1 %		88.3 %		91.6 %
Held for investment loan to deposit ratio		88.4 %		79.3 %		78.7 %		80.5 %		83.7 %
Net interest margin (1)		3.89 %		3.88 %		3.39 %		3.32 %		3.82 %
Cost of deposits (1)		0.26 %		0.27 %		0.29 %		0.29 %		0.29 %
Cost of funds (1)		0.36 %		0.36 %		0.42 %		0.43 %		0.43 %
Efficiency ratio		73.9 %		47.5 %		59.1 %		74.0 %		45.7 %
Operating efficiency ratio - Non-GAAP		73.9 %		47.4 %		58.7 %		69.8 %		43.8 %
Merger-related expenses (MRE)		—		50		171		1,441		1,237
Capital and Asset Quality Ratios:
Average stockholders' equity to average assets		10.8 %		10.4 %		10.1 %		9.7 %		7.1 %
Allowance for loan losses to loans held for investment, excluding PPP loans		0.84 %		0.65 %		0.68 %		0.73 %		0.76 %
Nonperforming loans to total assets		0.44 %		0.53 %		0.60 %		0.56 %		0.43 %
Nonperforming assets to total assets		0.44 %		0.53 %		0.61 %		0.57 %		0.45 %
Reconciliation of Non-GAAP Financial Measures (unaudited):
Tangible Common Equity:
Total stockholders' equity		$     261,660		$     278,482		$       277,139		$         269,720		$     266,826
Less:  Goodwill and other intangibles, net of deferred tax liability (2)		(32,632)		(32,716)		(32,942)		(33,224)		(34,153)
Tangible common equity (Non-GAAP)		$     229,028		$     245,766		$       244,197		$         236,496		$     232,673
Total shares outstanding		18,762		18,771		18,774		18,776		18,631
Book value per share		$         13.95		$         14.84		$           14.76		$             14.48		$         14.32
Tangible book value per share (Non-GAAP)		12.21		13.09		13.01		12.69		12.49
Tangible stockholders' equity to tangible total assets
Total assets		$  2,799,643		$  2,724,584		$    2,665,139		$      2,699,302		$  2,764,730
Less:  Goodwill and other intangibles, net of deferred tax liability (2)		(32,632)		(32,716)		(32,942)		(33,224)		(34,153)
Tangible total assets (Non-GAAP)		$  2,767,011		$  2,691,868		$    2,632,197		$      2,666,078		$  2,730,577
Tangible common equity (Non-GAAP)		$     229,028		$     245,766		$       244,197		$         236,496		$     232,673
Tangible stockholders' equity to tangible total assets (Non-GAAP)		8.3 %		9.1 %		9.3 %		8.9 %		8.5 %
Operating return on average assets (annualized)
Net income		$         1,118		$       17,755		$         12,795		$             6,806		$       28,642
Add: MRE, after-tax basis (ATB) (3)		—		40		135		1,138		977
Operating net income (Non-GAAP)		$         1,118		$       17,795		$         12,930		$             7,944		$       29,619
Average assets		$  2,646,874		$  2,653,987		$    2,687,204		$      2,749,909		$  3,383,015
Operating return on average assets (annualized) (Non-GAAP)		0.17 %		2.68 %		1.92 %		1.16 %		3.50 %
Operating return on average equity (annualized)
Net income		$         1,118		$       17,755		$         12,795		$             6,806		$       28,642
Add: MRE, ATB (3)		—		40		135		1,138		977
Operating net income (Non-GAAP)		$         1,118		$       17,795		$         12,930		$             7,944		$       29,619
Average stockholders' equity		$     284,913		$     274,887		$       270,730		$         267,670		$     241,731
Operating return on average equity (annualized) (Non-GAAP)		1.57 %		25.89 %		19.10 %		11.87 %		49.01 %
Operating efficiency ratio
Total noninterest expense		$       25,326		$       22,691		$         25,445		$           25,637		$       30,548
Less: MRE		—		50		171		1,441		1,237
Noninterest expense excluding MRE (Non-GAAP)		$       25,326		$       22,641		$         25,274		$           24,196		$       29,311
Net interest income		24,090		23,668		20,878		21,124		30,462
Noninterest income		10,190		24,094		22,203		13,518		36,425
Total of net interest income and noninterest income		$       34,280		$       47,762		$         43,081		$           34,642		$       66,887
Operating efficiency ratio (Non-GAAP)		73.9 %		47.4 %		58.7 %		69.8 %		43.8 %
(1) Annualized.
(2) Excludes mortgage servicing rights.
(3) Assumes an income tax rate of 21% and full deductibility.

 

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SOURCE Blue Ridge Bankshares, Inc.

FAQ

What were Blue Ridge Bankshares' financial results for Q2 2022?

Blue Ridge Bankshares reported a net income of $1.1 million for Q2 2022, down from $17.4 million in Q1 2022.

What factors affected Blue Ridge Bankshares' earnings in Q2 2022?

Earnings were impacted by $9.4 million in fair value adjustments and decreased income from the mortgage division.

How much did Blue Ridge Bankshares' assets grow by in Q2 2022?

Total assets rose to $2.80 billion as of June 30, 2022.

What was the loan growth rate for Blue Ridge Bankshares in Q2 2022?

The company experienced a 30.5% annualized growth rate in loans held for investment.

What was the provision for loan losses reported by Blue Ridge Bankshares in Q2 2022?

The company recorded a provision for loan losses of $7.5 million in Q2 2022.