Bank7 Corp. Announces Q2 2024 Earnings

Rhea-AI Summary

Bank7 Corp. (NASDAQ: BSVN) announced its Q2 2024 earnings, reporting a record net income of $11.5 million, up 18.24% from Q2 2023. Earnings per share (EPS) increased by 17.14% to $1.23. The company's total assets marginally rose to $1.7 billion, while total loans grew by 5.94% to $1.4 billion. Net interest income for the quarter was $21.2 million, a 3.57% increase from Q2 2023. The bank's capital levels remain significantly above regulatory requirements, with a Tier 1 leverage ratio of 11.12%. Despite these gains, total assets fell by 5.19% from Q1 2024, and total interest income decreased by 2.76%. The report highlights a disciplined cost control approach and excellent credit quality as key factors driving the strong performance.

Positive

• Net income increased by 18.24% to $11.5 million.
• EPS rose by 17.14% to $1.23.
• Total loans grew by 5.94% to $1.4 billion.
• Net interest income for Q2 2024 was $21.2 million, a 3.57% increase from Q2 2023.
• Bank's capital levels remain significantly above regulatory requirements.

Negative

• Total assets decreased by 5.19% from Q1 2024.
• Total interest income fell by 2.76% from Q1 2024.

Insights

Financial Analyst

Bank7 Corp.'s Q2 2024 earnings report reveals a strong financial performance, marked by a 18.24% increase in net income and a 17.14% rise in earnings per share (EPS) compared to the same period last year. This robust growth is primarily driven by disciplined cost controls and excellent credit quality. For a retail investor, the consistent increase in net income and EPS is a positive indicator of the company's profitability and management's efficiency in handling operational costs.

However, it's important to note the slight decrease in total assets by 5.19% and total loans by 1.59% compared to the previous quarter. This could suggest a slower growth rate in their loan portfolio, which might be a concern if the trend continues. Additionally, the total interest income has also decreased by 2.76%, indicating potential pressure on their interest margins. Nonetheless, the bank's capital levels remain significantly above the required minimums, ensuring a strong capital base.

Market Research Analyst

From a market perspective, Bank7 Corp.'s performance highlights its strategic focus on maintaining high credit quality and disciplined cost management. The increase in pre-provision pre-tax earnings (PPE) by 9.57% compared to the previous year suggests a solid operational efficiency that can absorb potential credit losses. This metric is particularly important as it excludes volatile components like tax expenses and provisions for credit losses, providing a clearer picture of core operational profitability.

However, the decrease in deposits and interest-bearing time deposits in other banks signals a potential shift in the bank's funding strategy, which could affect its liquidity position. Retail investors should monitor these trends closely, as they can impact the bank's ability to fund future loan growth and sustain profitability.

Furthermore, the Net Interest Margin (NIM) has shown a slight improvement from 5.09% to 5.15% for the six months ended June 30, 2024. This indicates that the bank's interest income is growing faster than its interest expenses, which is a positive sign of effective interest rate management.

OKLAHOMA CITY, July 11, 2024 /PRNewswire/ -- Bank7 Corp. (NASDAQ: BSVN) ("the Company"), the parent company of Oklahoma City-based Bank7 (the "Bank"), today reported unaudited results for the quarter ended June 30, 2024.  "We are pleased to announce another record quarter of net income and EPS.  Our asset sensitive balance sheet, disciplined approach to cost controls, and excellent credit quality continues to produce outstanding results" said Thomas L. Travis, President and CEO of the Company." 

For the three months ended June 30, 2024 compared to the three months ended June 30, 2023:

• Net income of $11.5 million compared to $9.7 million, an increase of 18.24%
• Earnings per share of $1.23 compared to $1.05, an increase of 17.14%
• Total assets of $1.7 billion compared to $1.7 billion, an increase of 0.10%
• Total loans of $1.4 billion compared to $1.3 billion, an increase of 5.94%
• PPE of $15.3 million compared to $13.9 million, an increase of 9.57%
• Total interest income of $32.4 million compared to $30.0 million, an increase of 7.74%

Three months ended June 30, 2024 compared to three months ended March 31, 2024

• Net income of $11.5 million compared to $11.3 million, an increase of 2.09%
• Earnings per share of $1.23 compared to $1.21, an increase of 1.65%
• Total assets of $1.7 billion compared to $1.8 billion, a decrease of 5.19%
• Total loans of $1.4 billion compared to $1.4 billion, a decrease of 1.59%
• PPE of $15.3 million compared to $14.9 million, an increase of 2.50%
• Total interest income of $32.4 million compared to $33.3 million, a decrease of 2.76%

Both the Bank's and the Company's capital levels continue to be significantly above the minimum levels required to be designated as "well-capitalized" for regulatory purposes.  On June 30, 2024, the Bank's Tier 1 leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratios were 11.12%, 13.04%, and 14.28%, respectively.  On June 30, 2024, on a consolidated basis, the Company's Tier 1 leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratios were 11.12%, 13.03%, and 14.27%, respectively.  Designation as a well-capitalized institution under regulations does not constitute a recommendation or endorsement by bank regulators. 

Non-GAAP Financial Measures:
This earnings release contains the non-GAAP financial measure pre-provision pre-tax earnings ("PPE").  The Company's management uses this non-GAAP measure in their analysis of the Company's performance.  This measure adjusts GAAP performance to exclude from net income, income tax expense, provision for credit losses, and loss on sales and calls of available-for-sale debt securities.

	For the Three Months Ended
	June 30, 2024		March 31, 2024		June 30, 2023
Calculation of Pre-Provision Pre-Tax Earnings ("PPE")	(Dollars in thousands)
Net Income	$             11,524		$             11,288		$               9,746
Income Tax Expense	3,731		3,595		3,158
Pre-tax net income	15,255		14,883		12,904
Add back: Provision for credit losses	-		-		1,011
Add back: (Gain)Loss on sales/calls of AFS debt securities	-		-		7
Pre-provision pre-tax earnings	15,255		14,883		13,922

 

Bank7 Corp. Consolidated Balance Sheets
Assets	June 30, 2024 (unaudited)		December 31, 2023
Cash and due from banks	$            210,105		$            181,042
Interest-bearing time deposits in other banks	12,202		17,679
Available-for-sale debt securities	66,284		169,487
Loans, net of allowance for credit losses of $17,772 and
$19,691 at June 30, 2024 and December 31, 2023, respectively	1,334,317		1,341,148
Loans held for sale, at fair value	-		718
Premises and equipment, net	16,736		14,942
Nonmarketable equity securities	1,275		1,283
Core deposit intangibles	938		1,031
Goodwill	8,458		8,458
Income taxes receivable	358		-
Interest receivable and other assets	32,240		35,878
Total assets	$        1,682,913		$        1,771,666
Liabilities and Shareholders' Equity
Deposits
Noninterest-bearing	$            350,324		$            482,349
Interest-bearing	1,130,993		1,109,042
Total deposits	1,481,317		1,591,391
Income taxes payable	-		302
Interest payable and other liabilities	10,790		9,647
Total liabilities	1,492,107		1,601,340
Shareholders' equity
Common stock, $0.01 par value; 50,000,000 shares authorized; shares
issued and outstanding: 9,253,038 and 9,197,696 at June 30, 2024
and December 31, 2023, respectively	93		92
Additional paid-in capital	98,570		97,417
Retained earnings	97,891		78,962
Accumulated other comprehensive loss	(5,748)		(6,145)
Total shareholders' equity	190,806		170,326
Total liabilities and shareholders' equity	$        1,682,913		$        1,771,666

 

		Three Months Ended				Six Months Ended
		June 30,				June 30,
		2024 (unaudited)		2023		2024 (unaudited)		2023
Interest Income
Loans, including fees		$       28,926		$     26,885		$      59,043		$     52,237
Interest-bearing time deposits in other banks		246		62		499		111
Debt securities, taxable		951		701		1,963		1,407
Debt securities, tax-exempt		71		85		144		172
Other interest and dividend income		2,242		2,309		4,074		3,495
Total interest income		32,436		30,042		65,723		57,422
Interest Expense
Deposits		11,204		9,544		22,481		16,918
Total interest expense		11,204		9,544		22,481		16,918
Net Interest Income		21,232		20,498		43,242		40,504
Provision for Credit Losses		-		1,011		-		1,485
Net Interest Income After Provision for Credit Losses		21,232		19,487		43,242		39,019
Noninterest Income
Mortgage lending income		78		112		129		166
Loss on sales, prepayments, and calls of available-for-sale debt securities		-		(7)		-		(8)
Service charges on deposit accounts		260		199		509		434
Other		2,827		490		4,536		874
Total noninterest income		3,165		794		5,174		1,466
Noninterest Expense
Salaries and employee benefits		5,118		4,709		10,407		9,389
Furniture and equipment		324		251		554		500
Occupancy		613		599		1,273		1,318
Data and item processing		481		469		939		856
Accounting, marketing and legal fees		264		179		364		478
Regulatory assessments		336		339		723		734
Advertsing and public relations		83		52		229		200
Travel, lodging and entertainment		131		110		183		171
Other		1,792		669		3,606		1,381
Total noninterest expense		9,142		7,377		18,278		15,027
Income Before Taxes		15,255		12,904		30,138		25,458
Income tax expense		3,731		3,158		7,326		6,105
Net Income		$       11,524		$       9,746		$      22,812		$     19,353
Earnings per common share - basic		$            1.25		$          1.06		$           2.47		$          2.12
Earnings per common share - diluted		1.23		1.05		2.44		2.09
Weighted average common shares outstanding - basic		9,250,332		9,153,077		9,235,176		9,150,022
Weighted average common shares outstanding - diluted		9,367,247		9,247,101		9,343,047		9,256,450
Other Comprehensive Income
Unrealized gains (losses) on securities, net of tax expense of $123 and tax benefit $0
for the three months ended June 30, 2024 and 2023, respectively; net of tax expense of $123
and tax benefit of $554 for the six months ended June 30, 2024 and 2023, respectively		$             (59)		$     (1,169)		$            397		$           586
Reclassification adjustment for realized losses included in net income net of tax of $0 and $2
for the three months ended June 30, 2024 and 2023, respectively; $0 and $2 for the
six months ended June 30, 2024 and 2023, respectively		-		5		-		6
Other comprehensive income (loss)		$             (59)		$     (1,164)		$            397		$           592
Comprehensive Income		$       11,465		$       8,582		$      23,209		$     19,945

 

		Net Interest Margin
		For the Six Months Ended June 30,
		2024 (unaudited)						2023
		Average Balance		Interest Income/ Expense		Average Yield/ Rate		Average Balance		Interest Income/ Expense		Average Yield/ Rate
		(Dollars in thousands)
Interest-Earning Assets:
Short-term investments		$     174,787		$       4,573		5.25 %		$     154,896		$       3,606		4.69 %
Debt securities, taxable-equivalent		129,963		1,963		3.03		153,478		1,407		1.85
Debt securities, tax exempt		17,761		144		1.63		20,030		172		1.73
Loans held for sale		297		-		-		56		-		-
Total loans(1)		1,362,339		59,043		8.69		1,277,245		52,237		8.25
Total interest-earning assets		1,685,147		65,723		7.82		1,605,705		57,422		7.21
Noninterest-earning assets		39,246						24,299
Total assets		$  1,724,393						$  1,630,004
Funding sources:
Interest-bearing liabilities:
Deposits:
Transaction accounts		$     848,764		16,489		3.90 %		$     810,736		12,612		3.14 %
Time deposits		256,212		5,992		4.69		239,720		4,306		3.62
Total interest-bearing deposits		1,104,976		22,481		4.08		1,050,456		16,918		3.25
Total interest-bearing liabilities		1,104,976		22,481		4.08		1,050,456		16,918		3.25
Noninterest-bearing liabilities:
Noninterest-bearing deposits		426,696						414,383
Other noninterest-bearing liabilities		12,218						11,659
Total noninterest-bearing liabilities		438,914						426,042
Shareholders' equity		180,503						153,506
Total liabilities and shareholders' equity		$  1,724,393						$  1,630,004
Net interest income				$     43,242						$     40,504
Net interest spread						3.74 %						3.96 %
Net interest margin						5.15 %						5.09 %

(1)           Nonaccrual loans are included in total loans

 

		Net Interest Margin
		For the Three Months Ended June 30,
		2024 (unaudited)						2023
		Average Balance		Interest Income/ Expense		Average Yield/ Rate		Average Balance		Interest Income/ Expense		Average Yield/ Rate
		(Dollars in thousands)
Interest-Earning Assets:
Short-term investments		$     173,502		$      2,488		5.75 %		$     174,920		$      2,371		5.44 %
Debt securities, taxable-equivalent		106,457		951		3.58		153,424		701		1.83
Debt securities, tax exempt		17,252		71		1.65		19,744		85		1.73
Loans held for sale		355		-		-		68		-		-
Total loans(1)		1,354,985		28,926		8.56		1,283,341		26,885		8.40
Total interest-earning assets		1,652,551		32,436		7.87		1,631,497		30,042		7.39
Noninterest-earning assets		38,722						25,050
Total assets		$  1,691,273						$  1,656,547
Funding sources:
Interest-bearing liabilities:
Deposits:
Transaction accounts		$     851,751		8,293		3.91 %		$     817,819		6,860		3.36 %
Time deposits		247,452		2,911		4.72		265,396		2,684		4.06
Total interest-bearing deposits		1,099,203		11,204		4.09		1,083,215		9,544		3.53
Total interest-bearing liabilities		$  1,099,203		11,204		4.09		$  1,083,215		9,544		3.53
Noninterest-bearing liabilities:
Noninterest-bearing deposits		$     394,010						$     403,207
Other noninterest-bearing liabilities		12,778						12,180
Total noninterest-bearing liabilities		406,788						415,387
Shareholders' equity		185,282						157,945
Total liabilities and shareholders' equity		$  1,691,273						$  1,656,547
Net interest income				$    21,232						$    20,498
Net interest spread						3.78 %						3.85 %
Net interest margin						5.15 %						5.04 %

(1)           Nonaccrual loans are included in total loans

About Bank7 Corp. 

We are Bank7 Corp., a bank holding company headquartered in Oklahoma City, Oklahoma. Through our wholly-owned subsidiary, Bank7, we operate twelve locations in Oklahoma, the Dallas/Fort Worth, Texas metropolitan area and Kansas. We are focused on serving business owners and entrepreneurs by delivering fast, consistent and well-designed loan and deposit products to meet their financing needs. We intend to grow organically by selectively opening additional branches in our target markets as well as pursue strategic acquisitions.

Conference Call

Bank7 Corp. has scheduled a conference call to discuss its second quarter results, which will be broadcast live over the Internet, on Friday, July 11, 2024 at 10:00 a.m. central standard time. To participate in the call, dial 1-888-348-6421, or access it live over the Internet at https://app.webinar.net/0P6wZ64ME8o. For those not able to participate in the live call, an archive of the webcast will be available at https://app.webinar.net/0P6wZ64ME8o shortly after the call for 1 year.

Cautionary Statements Regarding Forward-Looking Information 

This communication contains a number of forward-looking statements. These forward-looking statements reflect Bank7 Corp.'s current views with respect to, among other things, future events and Bank7 Corp.'s financial performance. Any statements about Bank7 Corp.'s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as "anticipate," "believes," "can," "could," "may," "predicts," "potential," "should," "will," "estimate," "plans," "projects," "continuing," "ongoing," "expects," "intends" and similar words or phrases. Any or all of the forward-looking statements in (or conveyed orally regarding) this presentation may turn out to be inaccurate. The inclusion of or reference to forward-looking information in this presentation should not be regarded as a representation by Bank7 Corp. or any other person that the future plans, estimates or expectations contemplated by Bank7 Corp. will be achieved.

These forward-looking statements are subject to significant uncertainties because they are based upon:  the amount and timing of future changes in interest rates, market behavior, and other economic conditions; future laws, regulations, and accounting principles; changes in regulatory standards and examination policies, and a variety of other matters.  These other matters include, among other things, the impact the direct and indirect effect of economic conditions on interest rates, credit quality, loan demand, liquidity, and monetary and supervisory policies of banking regulators.  Bank7 Corp. has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that Bank7 Corp. believes may affect its financial condition, results of operations, business strategy and financial needs. Bank7 Corp.'s actual results could differ materially from those anticipated in such forward-looking statements as a result of risks, uncertainties and assumptions that are difficult to predict. If one or more events related to these or other risks or uncertainties materialize, or if Bank7 Corp.'s underlying assumptions prove to be incorrect, actual results may differ materially from what Bank7 Corp. anticipates. You are cautioned not to place undue reliance on forward-looking statements. Further, any forward-looking statement speaks only as of the date on which it is made and Bank7 Corp. undertakes no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as may be required by law. All forward-looking statements herein are qualified by these cautionary statements.

Contact:

Thomas Travis
President & CEO
(405) 810-8600

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SOURCE Bank7 Corp.

FAQ

What were Bank7 Corp's Q2 2024 net income and EPS?

Bank7 Corp reported a net income of $11.5 million and an EPS of $1.23 for Q2 2024.

How did Bank7 Corp's total assets change in Q2 2024 compared to Q1 2024?

Total assets decreased by 5.19%, falling from $1.8 billion in Q1 2024 to $1.7 billion in Q2 2024.

What was Bank7 Corp's total loan growth in Q2 2024?

Total loans grew by 5.94%, reaching $1.4 billion in Q2 2024 compared to Q2 2023.

How did Bank7 Corp's net interest income for Q2 2024 compare to Q2 2023?

Net interest income for Q2 2024 was $21.2 million, a 3.57% increase from Q2 2023.

What is Bank7 Corp's Tier 1 leverage ratio as of June 30, 2024?

As of June 30, 2024, Bank7 Corp's Tier 1 leverage ratio was 11.12%.