Bogota Financial Corp. Announces Sale-Leaseback Transaction and Balance Sheet Restructure
Bogota Financial Corp. (NASDAQ: BSBK) has completed a significant balance sheet restructuring in Q4 2024 through two key transactions. The first involved a sale-leaseback of three branch offices, generating a $9.0 million pre-tax gain. The second transaction resulted in an $8.9 million pre-tax loss from selling securities worth $66.0 million in amortized cost ($57.1 million market value).
The sold securities had a weighted average life of 5.5 years and yielded 1.89%. Part of the proceeds were reinvested in higher-yielding securities at approximately 5.49%, while the remainder will fund loans at current market rates of 6.50% to 7.75% and reduce higher-cost borrowings. The Bank is also removing its held-to-maturity designation on remaining HTM securities. These strategic moves aim to improve net interest margin and return on assets.
Bogota Financial Corp. (NASDAQ: BSBK) ha completato una significativa ristrutturazione del bilancio nel Q4 2024 attraverso due operazioni chiave. La prima ha coinvolto una vendita e successivo affitto di tre filiali, generando un . La seconda operazione ha comportato una perdita di $8,9 milioni prima delle tasse dalla vendita di titoli del valore di $66,0 milioni in costo ammortizzato ($57,1 milioni di valore di mercato).
I titoli venduti avevano una vita media ponderata di 5,5 anni e un rendimento dell'1,89%. Parte dei proventi sono stati reinvestiti in titoli a rendimento più elevato, a circa il 5,49%, mentre il resto finanzierà prestiti ai tassi di mercato attuali, che variano dal 6,50% al 7,75%, e ridurrà i prestiti a costo più elevato. La Banca sta anche rimuovendo la sua designazione di mantenimento fino alla scadenza sui restanti titoli HTM. Queste mosse strategiche mirano a migliorare il margine di interesse netto e il ritorno sugli attivi.
Bogota Financial Corp. (NASDAQ: BSBK) ha completado una importante reestructuración de balance en el cuarto trimestre de 2024 a través de dos transacciones clave. La primera implicó una venta y arrendamiento de tres sucursales, generando una ganancia de $9.0 millones antes de impuestos. La segunda transacción resultó en una pérdida de $8.9 millones antes de impuestos por la venta de valores por un costo amortizado de $66.0 millones ($57.1 millones de valor de mercado).
Los valores vendidos tenían una vida promedio ponderada de 5.5 años y generaban un rendimiento del 1.89%. Parte de los ingresos se reinvirtieron en valores de mayor rendimiento a aproximadamente 5.49%, mientras que el resto financiará préstamos a tasas de mercado actuales que oscilan entre el 6.50% y el 7.75%, y reducirá las deudas a mayor coste. El Banco también está eliminando su designación de mantenido hasta el vencimiento sobre los valores HTM restantes. Estos movimientos estratégicos tienen como objetivo mejorar el margen de interés neto y el rendimiento de activos.
보고타 파이낸셜 코퍼레이션 (NASDAQ: BSBK)은 2024년 4분기 동안 두 개의 주요 거래를 통해 중요 재무 구조조정을 완료했습니다. 첫 번째 거래는 세 개의 지점 사무소의 매각-리스백으로, 세전 900만 달러의 이익을 창출했습니다. 두 번째 거래는 세전 890만 달러의 손실을 초래했고, 이는 6,600만 달러의 장부가치(5,710만 달러의 시장 가치)에서 증권을 판매한 결과입니다.
판매된 증권은 평균 잔여수명이 5.5년이고, 수익률은 1.89%였습니다. 수익금의 일부는 약 5.49%의 더 높은 수익률을 가진 증권에 재투자되었고, 나머지는 현재 시장 금리인 6.50%에서 7.75%의 대출에 사용할 것이며, 높은 비용의 차입금을 줄일 것입니다. 은행은 또한 남아 있는 만기 보유증권에 대한 만기 보유 지정도 제거하고 있습니다. 이러한 전략적 조치는 순이자 마진과 자산 수익률을 개선하기 위한 것입니다.
Bogota Financial Corp. (NASDAQ: BSBK) a achevé une restructuration significative de son bilan au quatrième trimestre 2024 à travers deux transactions clés. La première a impliqué une vente et une location de trois agences, générant un bénéfice avant impôt de 9,0 millions de dollars. La seconde transaction a entraîné une perte avant impôt de 8,9 millions de dollars liée à la vente de titres d'une valeur de 66,0 millions de dollars en coût amorti (valeur de marché de 57,1 millions de dollars).
Les titres vendus avaient une durée de vie moyenne pondérée de 5,5 ans et offraient un rendement de 1,89%. Une partie des produits a été réinvestie dans des titres à rendement plus élevé d'environ 5,49%, tandis que le reste financera des prêts aux taux de marché actuels de 6,50% à 7,75% et réduira les emprunts à coût élevé. La Banque supprime également sa désignation d'HTM pour les titres restants. Ces mesures stratégiques visent à améliorer la marge d'intérêt nette et le rendement des actifs.
Bogota Financial Corp. (NASDAQ: BSBK) hat im 4. Quartal 2024 eine bedeutende Bilanzrestrukturierung durch zwei wichtige Transaktionen abgeschlossen. Die erste beinhaltete einen Sale-and-Lease-Back von drei Geschäftsstellen, was einen Gewinn von 9,0 Millionen Dollar vor Steuern generierte. Die zweite Transaktion führte zu einem Verlust von 8,9 Millionen Dollar vor Steuern aus dem Verkauf von Wertpapieren im Wert von 66,0 Millionen Dollar zu fortgeführten Anschaffungskosten (Marktwert von 57,1 Millionen Dollar).
Die verkauften Wertpapiere hatten eine gewichtete durchschnittliche Laufzeit von 5,5 Jahren und erzielten eine Rendite von 1,89%. Ein Teil der Erlöse wurde in höherverzinsliche Wertpapiere mit etwa 5,49% reinvestiert, während der Rest aktuelle Marktdarlehen zu Zinssätzen zwischen 6,50% und 7,75% finanzieren und hochverzinsliche Kredite reduzieren wird. Die Bank entfernt zudem die Halteabsicht für die verbleibenden HTM-Wertpapiere. Diese strategischen Maßnahmen zielen darauf ab, die Nettozinsspanne und die Gesamtrendite zu verbessern.
- Sale-leaseback of branches generated $9.0 million pre-tax gain
- Reinvestment of proceeds into higher-yielding securities (5.49% vs 1.89%)
- New loans to be funded at attractive rates of 6.50-7.75%
- Strategic restructuring expected to improve net interest margin and return on assets
- $8.9 million pre-tax loss on securities sale
- Sale of securities at $57.1 million market value versus $66.0 million amortized cost
Insights
This strategic balance sheet restructuring represents a sophisticated maneuver to enhance BSBK's financial performance. The sale-leaseback of three branches generating a
The removal of the HTM designation provides greater balance sheet flexibility, while the sale-leaseback structure preserves regulatory capital - a important consideration for a small-cap bank with
The expected improvement in net interest margin and return on assets should translate to enhanced profitability metrics in upcoming quarters. This transaction effectively trades short-term paper losses for sustainable earnings improvement, positioning BSBK more competitively in the current rate environment.
The operational implications of this restructuring are substantial. Converting owned branches to leased properties streamlines the balance sheet while maintaining operational presence. The reinvestment strategy targeting higher-yielding assets addresses a critical weakness in the existing portfolio, where the
The decision to remove the HTM designation from remaining securities provides greater operational flexibility, particularly valuable in a dynamic rate environment. The weighted average life of 5.5 years on the sold securities suggests careful portfolio selection to minimize long-term rate exposure while maximizing current opportunities. The strategy to utilize proceeds for loan origination at market rates of
TEANECK, N.J., Jan. 06, 2025 (GLOBE NEWSWIRE) -- Bogota Financial Corp. (NASDAQ: BSBK) (the “Company”), the holding company for Bogota Savings Bank (the “Bank”), announced that the Bank completed a balance sheet restructuring consisting of two key transactions in the fourth quarter of 2024. The Bank entered into a sale-leaseback transaction whereby the Bank sold three of its branch offices resulting in a
“These transactions are a key piece of our strategy to offload underperforming legacy investments and will allow us to improve future earnings and net interest margin. The sale-leaseback allowed us to accomplish this without deteriorating regulatory capital. This strategic repositioning will provide both short- and long-term benefits by strengthening our balance sheet, allowing for future growth and adding shareholder value,” commented Kevin Pace, the Company’s President and Chief Executive Officer.
About Bogota Financial Corp.
Bogota Financial Corp. is a Maryland corporation organized as the mid-tier holding company of Bogota Savings Bank and is the majority-owned subsidiary of Bogota Financial, MHC. Bogota Savings Bank is a New Jersey chartered stock savings bank that has served the banking needs of its customers in northern and central New Jersey since 1893. It operates from seven offices located in Bogota, Hasbrouck Heights, Upper Saddle River, Newark, Oak Ridge, Parsippany and Teaneck, New Jersey and operates a loan production office in Spring Lake, New Jersey.
Forward-Looking Statements
This press release contains certain forward-looking statements about the Company and the Bank. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include increased competitive pressures, changes in the interest rate environment, inflation, general economic conditions or conditions within the securities markets, real estate market values in the Bank’s lending area, changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio; the availability of low-cost funding; our continued reliance on brokered and municipal deposits; demand for loans in our market area; changes in the quality of our loan and security portfolios, economic assumptions or changes in our methodology, either of which may impact our allowance for credit losses calculation, increases in non-performing and classified loans, monetary and fiscal policies of the U.S. Government including policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System, a failure in or breach of the Company’s operational or security systems or infrastructure, including cyberattacks, the failure to maintain current technologies, failure to retain or attract employees and legislative, accounting and regulatory changes that could adversely affect the business in which the Company and the Bank are engaged.
The Company undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.
Contact
Kevin Pace – President & CEO, 201-862-0660 ext. 1110
FAQ
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