Bogota Financial Corp. Reports Results for the Three and Twelve Months Ended December 31, 2022

Rhea-AI Summary

Bogota Financial Corp. (NASDAQ: BSBK) reported Q4 2022 net income of $1.9 million ($0.14/share), down from $2.0 million ($0.15/share) in Q4 2021. For 2022, net income decreased 8.6% to $6.9 million ($0.51/share) from $7.5 million ($0.55/share) in 2021. Total assets rose 13.6% to $951.1 million, while net loans increased 26.1% to $719 million. Total deposits also grew 17.4% to $701.4 million, fueled by a new municipal deposit relationship. However, non-interest income dropped significantly by 79.8%, mainly due to decreased gains on loan sales. CEO Joseph Coccaro noted strong loan growth amid challenges like rising interest rates and inflation, anticipating a slower market ahead.

Positive

• Net loans increased by 26.1% to $719 million.
• Total assets rose 13.6% to $951.1 million.
• Total deposits increased 17.4% to $701.4 million.
• Net interest income up 19.7% to $23.1 million for 2022.

Negative

• Net income decreased by 8.6% for 2022 compared to 2021.
• Non-interest income dropped by 79.8%, severely impacting revenue.
• Return on average assets decreased to 0.77% from 1.23% in 2021.

TEANECK, N.J.--(BUSINESS WIRE)-- Bogota Financial Corp. (NASDAQ: BSBK) (the “Company”), the holding company for Bogota Savings Bank (the “Bank”), reported net income for the three months ended December 31, 2022 of $1.9 million or $0.14 per basic and diluted share, compared to net income of $2.0 million or $0.15 per basic and $0.14 per diluted share for the comparable prior year period. The Company reported net income for the twelve months ended December 31, 2022 of $6.9 million or $0.51 per basic and diluted share compared to net income of $7.5 million, or $0.55 per basic and $0.52 per diluted share, for the prior year. During the twelve months ended December 31, 2021, the Company recorded a bargain purchase gain of $2.0 million, and merger-related expenses of $392,000, each of which was associated with the acquisition of Gibraltar Bank. Excluding the bargain purchase gain and the merger-related expenses in 2021, net income for the twelve months ended December 31, 2021 was $6.0 million or $0.43 per basic and $0.42 per diluted share.¹

On April 12, 2022, the Company announced it completed its initial stock repurchase plan, repurchasing 296,044 shares, or approximately 5% of its then outstanding common stock (excluding shares held by Bogota Financial, MHC), at an average cost of $10.82 per share. On September 21, 2022, the Company completed its second stock repurchase plan by repurchasing 292,568 shares, or approximately 5% of its then outstanding common stock (excluding shares held by Bogota Financial, MHC), at an average cost of $11.14 per share. On October 3, 2022, the Company announced it had received regulatory approval for the repurchase of up to 556,631 shares of its common stock, which was approximately 10% of its then outstanding common stock (excluding shares held by Bogota Financial, MHC). As of December 31, 2022, 360,372 shares have been repurchased.

Other Financial Highlights:

• Total assets increased $113.7 million, or 13.6%, to $951.1 million at December 31, 2022 from $837.4 million at December 31, 2021, due to an increase in loans and securities, which was primarily funded by cash and cash equivalents, deposits and borrowings.
• Net loans increased $148.8 million, or 26.1%, to $719.0 million at December 31, 2022 from $570.2 million at December 31, 2021.
• Total deposits were $701.4 million, increasing $103.9 million, or 17.4%, as compared to $597.5 million at December 31, 2021, primarily due to a new $38.2 million municipal deposit relationship and $126.2 million in increased certificates of deposit. The average rate paid on deposits at December 31, 2022 increased 121 basis points to 1.82% at December 31, 2022 from 0.61% at December 31, 2021 due to higher interest rates and a larger percentage of deposits consisting of higher-costing certificates of deposit.
• Return on average assets was 0.77% for the twelve-month period ended December 31, 2022 compared to 1.23% for 2021. Without the bargain purchase gain and merger-related expenses, the return on average assets would have been 0.98%¹ for the twelve-month period ended December 31, 2021.
• Return on average equity was 4.76% for the twelve-month period ended December 31, 2022 compared to 7.06% for 2021. Without the bargain purchase gain and merger-related expenses, the return on average equity would have been 5.60%¹ for the twelve-month period ended December 31, 2021.

^[1] This number represents a non-GAAP financial measure. Please see “Reconciliation of GAAP to Non-GAAP” contained at the end of this release.

Joseph Coccaro, President and Chief Executive Officer, said, “We are pleased with our results for 2022. We had over $225 million in new loan originations, which increased our loan portfolio by $149 million during the year. We continue to have strong credit quality as non-performing loans and criticized assets remain low. We continue to see improvement in our net interest margin which rose 24 basis points and 26 basis points as compared to the three and twelve months ended December 31, 2021, respectively.“

Mr. Coccaro further stated, "We are pleased to report continued consistent earnings and exceptional loan growth during a challenging economic environment in 2022. We expect loan growth to slow in the first quarter as interest rates continue to increase, higher inflation and the continued low inventory in housing will slow the market. Increased interest rate liability costs may impact future earnings.“

Income Statement Analysis

Comparison of Operating Results for the Three Months Ended December 31, 2022 and December 31, 2021

Net income decreased by $130,000, or 6.4%, to $1.9 million for the three months ended December 31, 2022 from $2.0 million for the three months ended December 31, 2021. The decrease was due to an increase of $150,000 in the provision for loan losses, a decrease in non-interest income of $1.0 million and an increase in income tax expense of $328,000, offset by an increase in net interest income of $1.2 million and a decrease of $167,000 in non-interest expense.

Interest income on cash and cash equivalents decreased $7,000, or 18.9%, to $30,000 for the three months ended December 31, 2022 from $37,000 for the three months ended December 31, 2021 due to a $103.4 million decrease in the average balance of cash and cash equivalents to $3.0 million for the three months ended December 31, 2022 from $106.4 million for the three months ended December 31, 2021, reflecting the use of excess liquidity to fund loan originations and purchase investment securities. This was offset by a 384 basis point increase in the average yield on cash and cash equivalents from 0.14% for the three months ended December 31, 2021 to 3.98% for the three months ended December 31, 2022 due to the higher interest rate environment.

Interest income on loans increased $2.3 million, or 41.5%, to $7.9 million for the three months ended December 31, 2022 compared to $5.6 million for the three months ended December 31, 2021 due primarily to an $139.4 million increase in the average balance of loans to $717.1 million for the three months ended December 31, 2022 from $577.7 million for the three months ended December 31, 2021 and due to a 54 basis point increase in the average yield on loans from 3.81% for the three months ended December 31, 2021 to 4.35% for the three months ended December 31, 2022.

Interest income on securities increased $521,000, or 113.4%, to $980,000 for the three months ended December 31, 2022 from $459,000 for the three months ended December 31, 2021 due primarily to a $69.4 million increase in the average balance of securities to $167.7 million for the three months ended December 31, 2022 from $98.3 million for the three months ended December 31, 2021, reflecting the purchase of investments with excess liquidity, and to a lesser extent, due to a 47 basis point increase in the average yield from 1.87% for the three months ended December 31, 2021 to 2.34% for the three months ended December 31, 2022.

Interest expense on interest-bearing deposits increased $1.3 million, or 138.0%, to $2.2 million for the three months ended December 31, 2022 from $916,000 for the three months ended December 31, 2021. The increase was due to a 69 basis point increase in the average cost of interest-bearing deposits to 1.34% for the three months ended December 31, 2022 from 0.65% for the three months ended December 31, 2021. The increase in the average cost of deposits was due to the higher interest rate environment and higher average balances of certificates of deposit. The increased expense on interest-bearing deposits was also due to an $89.7 million increase in the average balance of total deposits to $647.3 million for the three months ended December 31, 2022 from $557.6 million for the three months ended December 31, 2021.

Interest expense on Federal Home Loan Bank borrowings increased $417,000, or 121.9%, from $342,000 for the three months ended December 31, 2021 to $759,000 for the three months ended December 31, 2022. The increase was due to an increase in the average cost of borrowings of 91 basis points to 2.47% for the three months ended December 31, 2022 from 1.56% for the three months ended December 31 2021 due to the new borrowings at higher rates. The increase was also due to an increase in the average balance of borrowings of $35.1 million to $122.0 million for the three months ended December 31, 2022 from $86.9 million for the three months ended December 31, 2021.

Net interest income increased $1.2 million, or 24.6%, to $6.0 million for the three months ended December 31, 2022 from $4.8 million for the three months ended December 31, 2021. The increase reflected a 17 basis point increase in our net interest rate spread to 2.47% for the three months ended December 31, 2022 from 2.30% for the three months ended December 31, 2021. Our net interest margin increased 24 basis points to 2.68% for the three months ended December 31, 2022 from 2.44% for the three months ended December 31, 2021.

We recorded a $150,000 provision for loan losses for the three months ended December 31, 2022 compared to no provision for the three-month period ended December 31, 2021. Higher balances in residential and construction loans were the reason for the provision for the three months ended December 31, 2022. The Bank continues to have a low level of delinquent and non-accrual loans in the portfolio, as well as no charge-offs.

Non-interest income decreased by $1.0 million, or 79.8%, to $256,000 for the three months ended December 31, 2022 from $1.3 million for the three months ended December 31, 2021. Gain on sale of loans decreased $139,000 as the Bank decided to portfolio loans rather than sell loans and bank-owned life insurance decreased $860,000, or 82.4%, due to the collections of $1.8 million in death proceeds in the three months ended December 31, 2021.

For the three months ended December 31, 2022, non-interest expense decreased $167,000, or 4.5%, over the comparable 2021 period. Salaries and employee benefits decreased $22,000, or 1.0%, due to a lower employee count. Data processing expense decreased $46,000, or 17.8%, due to lower costs. Professional fees decreased $52,000, or 37.5%, due to lower legal expense. The increase in advertising expense of $28,000, or 28.7%, was due to additional promotions for branch locations and new promotions on deposit and loan products.

Income tax expense increased $328,000, or 81.1%, to $730,000 for the three months ended December 31, 2022 from $404,000 for the three months ended December 31, 2021. The increase was due to $1.0 million of higher taxable income. The effective tax rate for the three months ended December 31, 2022 and 2021 were 27.78% and 16.59%, respectively. For the three-month period ended December 31, 2021 there was $860,000 of additional proceeds from bank owned life insurance which resulted in a lower effective tax rate.

Comparison of Operating Results for the Twelve Months Ended December 31, 2022 and December 31, 2021

Net income decreased by $643,000, or 8.6%, to $6.9 million for the twelve months ended December 31, 2022 from $7.5 million for the twelve months ended December 31, 2021. The decrease was due to a decrease in non-interest income of $3.4 million, an increase in provision for loan losses of $513,000, and an increase of $739,000 in income taxes offset by an increase in net interest income of $3.8 million and a decrease in non-interest expense of $179,000. Excluding the one-time bargain purchase gain of $2.0 million that occurred in 2021 in connection with the Gibraltar Bank acquisition and the $392,000 merger-related expenses, net income would have increased $916,000 for the twelve months ended December 31, 2022 as compared to 2021.¹

Interest income on cash and cash equivalents decreased $34,000, or 22.5%, to $117,000 for the twelve months ended December 31, 2022 from $151,000 for the twelve months ended December 31, 2021 due to a $74.8 million decrease in the average balance of cash and cash equivalents to $25.0 million for the twelve months ended December 31, 2022 from $99.8 million for the twelve months ended December 31, 2021, reflecting the use of excess liquidity to fund loan originations and purchase investment securities. This was offset by a 32 basis point increase in the average yield on cash and cash equivalents from 0.15% for the twelve months ended December 31, 2021 to 0.47% for the twelve months ended December 31, 2022 due to the higher interest rate environment.

Interest income on loans increased $3.6 million, or 15.8%, to $26.3 million for the twelve months ended December 31, 2022 compared to $22.7 million for the twelve months ended December 31, 2021 due primarily to a $55.3 million increase in the average balance of loans to $638.7 million for the twelve months ended December 31, 2022 from $583.4 million for the twelve months ended December 31, 2021 and due to a 22 basis point increase in the average yield on loans from 3.89% for the twelve months ended December 31, 2021 to 4.11% for the twelve months ended December 31, 2022.

^[1] This number represents a non-GAAP financial measure. Please see “Reconciliation of GAAP to Non-GAAP” contained at the end of this release.

Interest income on securities increased $1.7 million, or 86.6%, to $3.7 million for the twelve months ended December 31, 2022 from $2.0 million for the twelve months ended December 31, 2021 due to a $82.0 million increase in the average balance of securities to $168.0 million for the twelve months ended December 31, 2022 from $86.0 million for the twelve months ended December 31, 2021, reflecting the purchase of investments with excess liquidity. The increase was offset by a 10 basis point decrease in the average yield from 2.29% for the twelve months ended December 31, 2021 to 2.19% for the twelve months ended December 31, 2022.

Interest expense on interest-bearing deposits increased $836,000, or 19.6%, to $5.1 million for the twelve months ended December 31, 2022 from $4.3 million for the twelve months ended December 31, 2021. This increase was due to a $60.4 million increase in the average balance of deposits to $597.7 million for the twelve months ended December 31, 2022 from $537.3 million for the twelve months ended December 31, 2021, primarily due to a $35.6 million increase in the average balance of NOW and money market accounts from $104.9 million for the twelve months ended December 31, 2021 to $140.5 million for the twelve months ended December 31, 2022. The increase was also due to a six basis point increase in the average cost of interest-bearing deposits to 0.85% for the twelve months ended December 31, 2022 from 0.79% for the twelve months ended December 31, 2021.

Interest expense on Federal Home Loan Bank borrowings increased $643,000, or 42.3%, from $1.5 million for the twelve months ended December 31, 2021 to $2.2 million for the twelve months ended December 31, 2022. The increase was due to an increase in the average cost of borrowings of 55 basis points to 2.11% for the twelve months ended December 31, 2022 from 1.56% for the twelve months ended December 31, 2021 due to the higher rates on new borrowings. The increase was also due to an increase in the average balance of borrowings of $4.9 million to $102.5 million for the twelve months ended December 31, 2022 from $97.6 million for the twelve months ended December 31, 2021.

Net interest income increased $3.8 million, or 19.7%, to $23.1 million for the twelve months ended December 31, 2022 from $19.3 million for the twelve months ended December 31, 2021. The increase reflected a 26 basis point increase in our net interest rate spread to 2.59% for the twelve months ended December 31, 2022 from 2.33% for the twelve months ended December 31, 2021. Our net interest margin increased 26 basis points to 2.76% for the twelve months ended December 31, 2022 from 2.50% for the twelve months ended December 31, 2021.

We recorded a $425,000 provision for loan losses for the twelve months ended December 31, 2022 compared to a $88,000 credit for the twelve months ended December 31, 2021. Higher balances in residential and construction loans were the reason for the provision for the twelve months ended December 31, 2022. The Bank continues to have a low level of delinquent and non-accrual loans in the portfolio, as well as no charge-offs.

Non-interest income decreased by $3.4 million, or 75.0%, to $1.1 million for the twelve months ended December 31, 2022 from $4.5 million for the twelve months ended December 31, 2021. For the twelve months ended December 31, 2021, there was a $2.0 million bargain purchase gain recognized in the Gibraltar Bank acquisition in 2021. Gain on sale of loans decreased $700,000 or 88.9% to $87,000 for the twelve months ended December 31, 2022 from $786,000 for the twelve months ended December 31, 2021. Bank-owned life insurance income decreased $742,000 or 51.6% to $695,000 for the twelve months ended December 31, 2022 from $1.4 million for the twelve months ended December 31, 2021 due to death proceeds collected during the twelve months ended December 31, 2021.

For the twelve months ended December 31, 2022, non-interest expense decreased $179,000, or 1.2%, to $14.3 million, over 2021. Salaries and employee benefits increased $691,000, or 8.9%, due to the new stock compensation plan adopted in September 2021 and due to more employees associated with the Gibraltar Bank acquisition and the addition of a sixth branch office. Data processing expense increased $97,000, or 9.3%, due to higher data processing expense associated with a larger company. Advertising expense increased $216,000 due to additional promotions for branch locations and new promotions for loan and deposit products. Professional fees decreased $189,000, or 25.7%, due to lower consulting and legal expense. Merger fees and core conversion costs were $1.1 million in 2021. The increase in equipment and occupancy expenses of $129,000, or 10.3%, was mainly due to the additional branch locations.

Income tax expense increased $739,000, or 39.4%, to $2.6 million for the three months ended December 31, 2022 from $1.9 million for the three months ended December 31, 2021. The increase was due to $735,000 of higher taxable income. The effective tax rate for the three months ended December 31, 2022 and 2021 were 27.55% and 19.96%, respectively. For the three-month period ended December 31, 2021 there was $742,000 additional proceeds from bank-owned life insurance which resulted in a lower effective tax rate.

Balance Sheet Analysis

Total assets were $951.1 million at December 31, 2022, representing an increase of $113.7 million, or 13.6%, from December 31, 2021. Cash and cash equivalents decreased $88.2 million during the period primarily due to funding of loan originations and investment purchases with excess liquidity. Net loans increased $148.8 million, or 26.1%, due to new production of $225.2 million, consisting of a mainly residential real estate loans and construction real estate loans offset by $76.4 million in repayments. Securities held to maturity increased $3.4 million due to the purchase of corporate bonds and mortgage-backed securities with excess cash. Securities available for sale increased $43.3 million or 103.4% due to the purchase of mortgage-backed securities and corporate bonds with excess cash. Bank-owned life insurance increased $5.7 million, or 23.2% due to a $5.0 million new purchase of bank-owned life insurance during the twelve months ended December 31, 2022.

Delinquent loans increased $151,000, or 9.1%, during the twelve-month period ended December 31, 2022, finishing at $1.8 million or 0.26% of total loans. During the same timeframe, non-performing assets remained unchanged at $1.9 million and were 0.26% of total assets at December 31, 2022. The Company’s allowance for loan losses was 0.36% of total loans and 136.3% of non-performing loans at December 31, 2022 compared to 0.38% of total loans and 113.85% of non-performing loans at December 31, 2021.

Total liabilities increased $121.7 million, or 17.6%, to $811.4 million mainly due to an increase in deposits, reflecting a new $38.2 million municipal relationship, and a $126.2 increase in certificates of deposit and a $17.3 million increase in borrowings. Total deposits increased $103.9 million, or 17.4%, to $701.4 million at December 31, 2022 from $597.5 million at December 31, 2021. The increase in deposits reflected an increase in interest-bearing deposits of $104.6 million, or 18.7%, to $662.8 million as of December 31, 2022 from $558.2 million at December 31, 2021, primarily due to increases in certificates of deposit, which increased by $126.2 million from $366.4 million at December 31, 2021 to $492.6 million at December 31, 2022 and in NOW accounts, which increased by $12.7 million to $82.7 million from $69.9 million at December 31, 2021. The increase in certificates of deposit was used to fund loan growth. These increases were offset by a decrease in non-interest bearing deposits of $664,000, or 1.7%, to $38.7 million as of December 31, 2022 from $39.3 million as of December 31, 2021, and a decrease in money market and savings accounts of $34.4 million, or 28.2%, to $87.4 million as of December 31, 2022 from $121.8 million as of December 31, 2021. Federal Home Loan Bank advances increased $17.3 million, or 20.3%, due to new advances for loan funding.

Stockholders’ equity decreased $7.9 million to $139.7 million, due to increased accumulated other comprehensive loss for securities available for sale of $5.9 million and the repurchase of 906,793 shares of stock during the year at a cost of $10.1 million, offset by net income of $6.9 million for the twelve months ended December 31, 2022. At December 31, 2022, the Company’s ratio of average stockholders’ equity-to-total assets was 15.61%, compared to 17.88% at December 31, 2021.

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 six offices located in Bogota, Hasbrouck Heights, 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, potential recessionary conditions, real estate market values in the Bank’s lending area changes in the quality of our loan and security portfolios, 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.

In addition, the COVID-19 pandemic has had, and may continue to have, an adverse impact on the Company, its clients and the communities it serves. Given its dynamic nature, it is difficult to predict the full impact of the COVID-19 pandemic on the Company’s business.

The Company undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.

BOGOTA FINANCIAL CORP. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
		As of				As of
		December 31, 2022				December 31, 2021
Assets		(unaudited)
Cash and due from banks		$	8,160,028			$	14,446,792
Interest-bearing deposits in other banks			8,680,889				90,621,993
Cash and cash equivalents			16,840,917				105,068,785
Securities available for sale			85,100,578				41,838,798
Securities held to maturity (fair value of $70,699,651 and $74,081,059, respectively)			77,427,309				74,053,099
Loans held for sale			—				1,152,500
Loans, net of allowance of $2,578,174 and $2,153,174, respectively			719,025,762				570,209,669
Premises and equipment, net			7,884,335				8,127,979
Federal Home Loan Bank (FHLB) stock and other restricted securities			5,490,900				4,851,300
Accrued interest receivable			3,966,651				2,712,605
Core deposit intangibles			267,272				336,364
Bank-owned life insurance			30,206,325				24,524,122
Other assets			4,888,954				4,486,366
Total Assets		$	951,099,003			$	837,361,587
Liabilities and Equity
Non-interest bearing deposits		$	38,653,349			$	39,317,500
Interest bearing deposits			662,758,100				558,162,278
Total deposits			701,411,449				597,479,778
FHLB advances			102,319,254				85,051,736
Advance payments by borrowers for taxes and insurance			3,174,661				2,856,120
Other liabilities			4,534,516				4,397,742
Total liabilities			811,439,880				689,785,376
Stockholders’ Equity
Preferred stock $0.01 par value 1,000,000 shares authorized, none issued and outstanding at December 31, 2022 and December 31, 2021			—				—
Common stock $0.01 par value, 30,000,000 shares authorized, 13,699,016 issued and outstanding at December 31, 2022 and 14,605,809 at December 31, 2021			136,989				146,057
Additional paid-in capital			59,099,476				68,247,204
Retained earnings			91,756,673				84,879,812
Unearned ESOP shares (436,495 shares at December 31, 2022 and 463,239 shares at December 31, 2021)			(5,123,002	)			(5,424,206	)
Accumulated other comprehensive loss			(6,211,013	)			(272,656	)
Total stockholders’ equity			139,659,123				147,576,211
Total liabilities and stockholders’ equity		$	951,099,003			$	837,361,587

BOGOTA FINANCIAL CORP. CONSOLIDATED STATEMENTS OF INCOME (unaudited)
		Three Months Ended December 31,								Year Ended December 31,
		2022				2021				2022				2021
Interest income
Loans		$	7,860,684			$	5,555,242			$	26,264,486			$	22,672,097
Securities
Taxable			933,963				439,128				3,516,832				1,912,146
Tax-exempt			45,882				20,094				161,187				58,888
Other interest-earning assets			140,335				91,936				403,969				424,539
Total interest income			8,980,864				6,106,400				30,346,474				25,067,670
Interest expense
Deposits			2,180,832				916,212				5,106,517				4,271,109
FHLB advances			759,476				342,317				2,162,217				1,519,302
Total interest expense			2,940,308				1,258,529				7,268,734				5,790,411
Net interest income			6,040,556				4,847,871				23,077,740				19,277,259
Provision (credit) for loan losses			150,000				—				425,000				(88,000	)
Net interest income after provision for loan losses			5,890,556				4,847,871				22,652,740				19,365,259
Non-interest income
Fees and service charges			42,848				37,222				179,734				136,211
Gain on sale of loans			—				139,211				86,913				786,424
Bargain purchase gain			—				17,573				—				1,950,970
Bank-owned life insurance			184,373				1,044,628				694,900				1,436,453
Other			28,801				28,572				162,126				183,454
Total non-interest income			256,022				1,267,206				1,123,673				4,493,512
Non-interest expense
Salaries and employee benefits			2,117,836				2,140,286				8,434,734				7,743,694
Occupancy and equipment			356,872				361,529				1,390,718				1,261,306
FDIC insurance assessment			58,210				54,000				220,210				217,300
Data processing			212,497				258,414				1,132,790				1,036,203
Advertising			124,424				96,665				492,859				276,665
Director fees			192,862				250,877				800,611				873,008
Professional fees			86,751				138,787				546,004				735,067
Merger fees			—				—				—				392,197
Core conversion costs			—				—				—				730,000
Other			361,653				377,275				1,267,081				1,198,081
Total non-interest expense			3,511,105				3,677,833				14,285,007				14,463,521
Income before income taxes			2,635,473				2,437,244				9,491,406				9,395,250
Income tax expense			732,122				404,372				2,614,545				1,875,175
Net income		$	1,903,351			$	2,032,872			$	6,876,861			$	7,520,075
Earnings per Share - basic		$	0.14			$	0.15			$	0.51			$	0.55
Earnings per Share - diluted		$	0.14			$	0.14			$	0.51			$	0.52
Weighted average shares outstanding - basic			13,299,055				13,900,769				13,570,407				13,725,884
Weighted average shares outstanding - diluted			13,330,553				14,222,841				13,576,934				14,350,788

BOGOTA FINANCIAL CORP. SELECTED RATIOS (unaudited)
	At or For the Three Months Ended December 31,								At or For the Twelve Months Ended December 31,
	2022				2021				2022				2021
Performance Ratios (1):
Return on average assets (2)		0.80	%			0.97	%			0.77	%			1.23	%
Return on average equity (3)		5.42	%			5.54	%			4.76	%			7.06	%
Interest rate spread (4)		2.73	%			2.30	%			2.59	%			2.33	%
Net interest margin (5)		2.85	%			2.44	%			2.73	%			2.50	%
Efficiency ratio (6)		55.76	%			60.14	%			59.03	%			60.85	%
Average interest-earning assets to average interest-bearing liabilities		116.23	%			122.19	%			119.60	%			122.40	%
Net loans to deposits		102.51	%			95.44	%			102.51	%			95.44	%
Equity to assets (7)		14.80	%			17.55	%			16.06	%			17.55	%
Capital Ratios:
Tier 1 capital to average assets										15.61	%			17.88	%
Asset Quality Ratios:
Allowance for loan losses as a percent of total loans										0.36	%			0.38	%
Allowance for loan losses as a percent of non-performing loans										136.32	%			113.85	%
Net recoveries to average outstanding loans during the period										0.00	%			0.00	%
Non-performing loans as a percent of total loans										0.26	%			0.33	%
Non-performing assets as a percent of total assets										0.20	%			0.23	%

(1)	Performance ratios are annualized.
(2)	Represents net income divided by average total assets.
(3)	Represents net income divided by average stockholders' equity.
(4)	Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of average interest-bearing liabilities. Tax exempt income is reported on a tax equivalent basis using a combined federal and state marginal tax rate of 27.5%.
(5)	Represents net interest income as a percent of average interest-earning assets. Tax exempt income is reported on a tax equivalent basis using a combined federal and state marginal tax rate of 27.5% for 2022 and 2021.
(6)	Represents non-interest expenses divided by the sum of net interest income and non-interest income.
(7)	Represents average stockholders' equity divided by average total assets.

LOANS
Loans are summarized as follows at December 31, 2022 and December 31, 2021:

		December 31, 2022				December 31, 2021
Real estate:		(unaudited)
Residential First Mortgage		$	466,100,627			$	319,968,234
Commercial and Multi-Family Real Estate			162,338,669				175,375,419
Construction			61,825,478				41,384,687
Commercial and Industrial			1,684,189				7,905,524
Consumer:
Home Equity and Other Consumer			29,654,973				27,728,979
Total loans			721,603,936				572,362,843
Allowance for loan losses			(2,578,174	)			(2,153,174	)
Net loans		$	719,025,762			$	570,209,669

The following tables set forth the distribution of total deposit accounts, by account type, at the dates indicated.

		At December 31,												At December
		2022												2021
		Amount				Percent				Average Rate				Amount				Percent				Average Rate
		(Dollars in thousands)
										(unaudited)
Noninterest bearing demand accounts		$	38,699				6.93	%			—	%		$	39,318				6.58	%			—	%
NOW accounts			82,674				11.79				0.88				69,940				11.71			0.82
Money market accounts			30,037				4.28				0.32				57,541				9.63				0.34
Savings accounts			57,408				8.18			0.49					64,285				10.76			0.26
Certificates of deposit			492,593				70.23				2.37				366,396				61.32				0.74
Total		$	701,411				100.00	%			1.82	%		$	597,480				100.00	%			0.61	%

Average Balance Sheets and Related Yields and Rates

The following tables present information regarding average balances of assets and liabilities, the total dollar amounts of interest income and dividends from average interest-earning assets, the total dollar amounts of interest expense on average interest-bearing liabilities, and the resulting annualized average yields and costs. The yields and costs for the periods indicated are derived by dividing income or expense by the average balances of assets or liabilities, respectively, for the periods presented. Average balances have been calculated using daily balances. Nonaccrual loans are included in average balances only. Loan fees are included in interest income on loans and are not material.

		Three Months Ended December 31,
		2022												2021
		Average Balance				Interest and Dividends				Yield/ Cost (3)				Average Balance				Interest and Dividends				Yield/ Cost (3)
		(Dollars in thousands)
Assets:		(unaudited)
Cash and cash equivalents		$	2,962			$	30				3.98	%		$	106,400			$	37				0.14	%
Loans			717,096				7,861				4.35	%			577,699				5,555				3.81	%
Securities			167,708				980				2.34	%			98,307				459				1.87	%
Other interest-earning assets			6,327				110				6.99	%			5,077				55				4.33	%
Total interest-earning assets			894,093				8,981				3.99	%			787,483				6,106				3.08	%
Non-interest-earning assets			53,969												48,406
Total assets		$	948,062											$	835,889
Liabilities and equity:
NOW and money market accounts		$	122,136			$	177				0.57	%		$	121,764			$	198				0.65	%
Savings accounts			57,038				57				0.40	%			64,363				41				0.25	%
Certificates of deposit			468,138				1,947				1.65	%			371,490				677				0.72	%
Total interest-bearing deposits			647,312				2,181				1.34	%			557,617				916				0.65	%
Federal Home Loan Bank advances (4)			121,961				759				2.47	%			86,855				342				1.56	%
Total interest-bearing liabilities			769,273				2,940				1.52	%			644,472				1,258				0.77	%
Non-interest-bearing deposits			36,105												39,703
Other non-interest-bearing liabilities			2,296												5,030
Total liabilities			807,674												689,205
Total equity			140,388												146,684
Total liabilities and equity		$	948,062											$	835,889
Net interest income						$	6,041											$	4,848
Interest rate spread (1)											2.47	%											2.30	%
Net interest margin (2)											2.68	%											2.44	%
Average interest-earning assets to average interest-bearing liabilities			116.23	%											122.19	%

1.	Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
2.	Net interest margin represents net interest income divided by average total interest-earning assets.
3.	Annualized.
4.	Cash flow hedges are used to manage interest rate risk.

		Twelve Months Ended December 31,
		2022												2021
		Average Balance				Interest and Dividends				Yield/ Cost (3)				Average Balance				Interest and Dividends				Yield/ Cost (3)
		(Dollars in thousands)
		(unaudited)
Assets:
Cash and cash equivalents		$	25,044			$	117				0.47	%		$	99,842			$	151				0.15	%
Loans			638,679				26,264				4.11	%			583,362				22,672				3.89	%
Securities			167,987				3,678				2.19	%			86,035				1,971				2.29	%
Other interest-earning assets			5,677				288				5.05	%			5,606				273				4.87	%
Total interest-earning assets			837,387				30,347				3.62	%			774,845				25,067				3.24	%
Non-interest-earning assets			52,525												42,252
Total assets		$	889,912											$	817,097
Liabilities and equity:
NOW and money market accounts		$	140,473			$	787				0.56	%		$	104,945			$	625				0.60	%
Savings accounts			62,626				184				0.29	%			58,880				127				0.22	%
Certificates of deposit			394,593				4,136				1.05	%			373,490				3,519				0.94	%
Total interest-bearing deposits			597,692				5,107				0.85	%			537,315				4,271				0.79	%
Federal Home Loan Bank advances (4)			102,458				2,162				2.11	%			97,621				1,519				1.56	%
Total interest-bearing liabilities			700,150				7,269				1.04	%			634,936				5,790				0.91	%
Non-interest-bearing deposits			41,501												30,952
Other non-interest-bearing liabilities			3,914												8,822
Total liabilities			745,565												674,710
Total equity			144,347												142,387
Total liabilities and equity		$	889,912											$	817,097
Net interest income						$	23,078											$	19,277
Interest rate spread (1)											2.59	%											2.33	%
Net interest margin (2)											2.76	%											2.50	%
Average interest-earning assets to average interest-bearing liabilities			119.60	%											122.04	%

1.	Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
2.	Net interest margin represents net interest income divided by average total interest-earning assets.
3.	Annualized.
4.	Cash flow hedges are used to manage interest rate risk.

Rate/Volume Analysis

The following table sets forth the effects of changing rates and volumes on net interest income. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the prior columns. Changes attributable to changes in both rate and volume that cannot be segregated have been allocated proportionally based on the changes due to rate and the changes due to volume.

		Three Months Ended December 31, 2022 Compared to Three Months Ended December 31, 2021												Twelve Months Ended December 31, 2022 Compared to Twelve Months Ended December 31, 2021
		Increase (Decrease) Due to												Increase (Decrease) Due to
		Volume				Rate				Net				Volume				Rate				Net
		(In thousands)
Interest income:		(unaudited)
Cash and cash equivalents		$	(280	)		$	273			$	(7	)		$	(175	)		$	141			$	(34	)
Loans receivable			1,453				853				2,306				2,250				1,342				3,592
Securities			384				137				521				1,797				(90	)			1,707
Other interest earning assets			16				39				55				4				11				15
Total interest-earning assets			1,573				1,302				2,875				3,876				1,404				5,280
Interest expense:
NOW and money market accounts			4				(25	)			(21	)			205				(43	)			162
Savings accounts			(28	)			44				16				9				48				57
Certificates of deposit			213				1,057				1,270				201				416				617
Federal Home Loan Bank advances			171				246				417				79				564				643
Total interest-bearing liabilities			360				1,322				1,682				494				985				1,479
Net increase (decrease) in net interest income		$	1,213			$	(20	)		$	1,193			$	3,382			$	419			$	3,801

BOGOTA FINANCIAL CORP.
RECONCILIATION OF GAAP TO NON-GAAP
(Unaudited)

The Company’s management believes that the presentation of net income on a non-GAAP basis, excluding nonrecurring items, provides useful information for evaluating the Company’s operating results and any related trends that may be affecting the Company’s business. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP.

	Twelve months ended December 31, 2021
	Income Before Income Taxes				Provision for Income Taxes				Net Income
GAAP basis	$	9,395,250			$	1,875,175			$	7,520,075
Add: merger and acquisition related expenses		392,197				—				392,197
Add: Charitable Foundation Contribution		—				—				—
Less: Bargain purchase gain		(1,950,970	)			—				(1,950,970	)
Non-GAAP basis	$	7,836,477			$	1,875,175			$	5,961,302
	Twelve months ended December 31,
Return on average assets (annualized):	2022				2021
GAAP		0.77	%			1.23	%
Adjustments		0.00	%			0.25	%
Non-GAAP		0.77	%			0.98	%
Return on average equity (annualized):
GAAP		4.76	%			7.06	%
Adjustments		0.00	%			1.46	%
Non-GAAP		4.76	%			5.60	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230130005732/en/

Joseph Coccaro – President & CEO, 201-862-0660 ext. 1110

Source: Bogota Financial Corp.

FAQ

What is the net income for Bogota Financial Corp. for Q4 2022?

Bogota Financial Corp. reported a Q4 2022 net income of $1.9 million.

How did total assets change for Bogota Financial Corp. in 2022?

Total assets increased by 13.6% to $951.1 million in 2022.

What was the increase in net loans for Bogota Financial Corp. in 2022?

Net loans increased by 26.1% to $719 million for the year.

Did Bogota Financial Corp. experience any changes in deposits in 2022?

Yes, total deposits rose 17.4% to $701.4 million in 2022.

What impact did loan sales have on Bogota Financial Corp.'s non-interest income?

Non-interest income decreased by 79.8% primarily due to reduced gains on loan sales.