Carter Bankshares, Inc. Announces First Quarter 2024 Financial Results
- Quarterly net income of $5.8 million and $0.25 diluted EPS
- Pre-tax pre-provision income of $7.2 million
- Significant impact of placing loans on nonaccrual status
- Increase in net interest income and margin
- Growth in total portfolio loans and deposits
- Rise in nonperforming loans due to largest lending relationship on nonaccrual status
- Efficiency ratio impacted by the nonaccrual relationship
- None.
Insights
MARTINSVILLE, VA / ACCESSWIRE / April 25, 2024 / Carter Bankshares, Inc. (the "Company") (NASDAQ:CARE), the holding company of Carter Bank & Trust (the "Bank") today announced quarterly net income of
The Company's financial results for the first quarter of 2024, compared to the prior year quarter, were significantly impacted by placing loans contained in the Bank's Other segment representing the Bank's largest lending relationship with an aggregate principal value of
Financial Highlights for the Three Months Ended March 31, 2024
- Net interest income increased
$1.0 million , or3.6% , to$28.4 million compared to the fourth quarter of 2023 primarily due to a 24 basis point increase in the yield on earning assets, partially offset by a 15 basis point increase in funding costs and decreased$12.4 million , or30.3% compared to the first quarter of 2023, primarily due to a 155 basis point increase in funding costs and a 12 basis point decrease in the yield on earning assets; - Net interest margin, on a fully taxable equivalent basis 3 ("FTE"), increased 11 basis points to
2.60% compared to the fourth quarter of 2023 and decreased 138 basis points compared to the first quarter of 2023. Net interest income and net interest margin was significantly impacted as a result of the Bank placing its largest lending relationship on nonaccrual status during the second quarter of 2023; - Total portfolio loans increased
$3.2 million to$3.5 billion at March 31, 2024 compared to December 31, 2023, but increased$260.2 million , or8.0% , compared to March 31, 2023. First quarter 2024 loan growth was muted by$80.0 million in loan payoffs of two large commercial real estate loans; - Total deposits increased
$108.6 million , or11.7% on an annualized basis, compared to December 31, 2023 and increased$293.5 million , or8.3% , compared to March 31, 2023; - Nonperforming loans to total portfolio loans were
8.76% ,8.83% and0.26% for the quarters ended March 31, 2024, December 31, 2023 and March 31, 2023, respectively. The significant impact to nonperforming loans was a result of the Bank placing its largest lending relationship on nonaccrual status during the second quarter of 2023; - The allowance for credit losses to total portfolio loans were
2.75% ,2.77% and2.91% at March 31, 2024, December 31, 2023 and March 31, 2023, respectively; - The efficiency ratio was
78.5% ,94.8% and51.8% for the quarters ended March 31, 2024, December 31, 2023 and March 31, 2023, respectively. The efficiency ratio was impacted primarily by the Bank's largest lending relationship that was placed in nonaccrual status during the second quarter of 2023.
"We continue to feel positive about the fundamentals of the Company and the structure of our balance sheet. Capital and liquidity levels continue to be strong. Loan production was again solid in the quarter, but was muted somewhat by two large commercial real estate loans that paid off during the quarter. Lending pipelines have slowed, but we are still expecting moderate loan growth this year. We believe our bond portfolio is well positioned to outperform many of our peers in what appears to be a protracted period of higher interest rates. Modest deposit growth is occurring in most categories except savings accounts. While there continues to be pressure on the cost of funds, rates have leveled a bit. However, the current rate environment will continue to impact our margin in the coming quarters. We expect that our net interest margin will return to a more normalized level once the large nonperforming loan ("NPL") relationship is resolved. Additionally, when the Fed begins to cut short-term interest rates, our balance sheet is positioned so that it will positively impact our margins. Other than the large NPL relationship, our asset quality remains strong across all credit metrics," stated Litz H. Van Dyke, Chief Executive Officer.
Van Dyke continued, "Obviously, the large NPL continues to have a negative impact on our financial results. However, aside from this issue, our financial performance for the quarter was solid.
We remain confident in the condition and positioning of our Company. We believe that we are well positioned for a prosperous future. Lastly, I want to reiterate that we continue to be confident that we will successfully resolve the large NPL, although we cannot give any assurance regarding the timeline for resolution. We are committed to pursuing all remedies to resolve this matter in a manner that best protects the Company and its shareholders."
Operating Highlights
Credit Quality
Nonperforming loans as a percentage of total portfolio loans were
During the second quarter of 2023, the Company placed commercial loans in the other segment of the Company's loan portfolio relating to the Bank's largest lending relationship with an aggregate principal amount of
The Company continues to initiate collection processes and explore all alternatives for repayment or resolution with respect to such loans. The Company believes it is well secured based on the net carrying value of the credit relationship and it has appropriately reserved for expected credit losses with respect to all such loans based on information currently available. However, the Company cannot give any assurance as to the timing or amount of future payments or collections on such loans or that the Company will ultimately collect all amounts contractually due under the terms of such loans. The Company has specific reserves of
The provision for credit losses decreased
Net Interest Income
Net interest income increased
Interest income increased
Interest expense increased
Net interest income decreased
Since the first quarter of 2023, there has been more pressure on our cost of funds due to the shift from non-maturing deposits to higher yielding certificates of deposits, money markets and higher-cost borrowings, which has negatively impacted our net interest margin. During the first quarter of 2024, this trend began to stabilize and we believe it will continue to stabilize in the coming quarters. Our balance sheet is currently exhibiting characteristics of a slightly liability sensitive balance sheet due to the short-term nature of our deposit portfolio. Specifically,
Noninterest Income
For the first quarter of 2024, total noninterest income was
The increase of
As compared to the first quarter of 2023, the
Noninterest Expense
For the first quarter of 2024, total noninterest expense was
The most significant variances compared to the fourth quarter of 2023 included decreases of
As compared to the first quarter of 2023, the most significant increases related to
Financial Condition
Total assets were
Total deposits increased
At March 31, 2024, noninterest-bearing deposits comprised
FHLB borrowings decreased
Capitalization and Liquidity
The Company remained well capitalized as of March 31, 2024. The Company's Tier 1 Capital ratio was
The Bank also remained well capitalized as of March 31, 2024. The Bank's Tier 1 Capital ratio was
Total capital of
At March 31, 2024, funding sources accessible to the Company include borrowing availability at the FHLB, equal to
About Carter Bankshares, Inc.
Headquartered in Martinsville, VA, Carter Bankshares, Inc. (NASDAQ: CARE) provides a full range of commercial banking, consumer banking, mortgage and services through its subsidiary Carter Bank & Trust. The Company has
Important Note Regarding Non-GAAP Financial Measures
In addition to traditional measures presented in accordance with GAAP, our management uses, and this press release contains or references, certain non-GAAP financial measures and should be read along with the accompanying tables in our definitions and reconciliations of GAAP to non-GAAP financial measures. This press release and the accompanying tables discuss financial measures that we believe are useful because they enhance the ability of investors and management to evaluate and compare the Company's operating results from period to period in a meaningful manner. Non-GAAP measures should not be considered as an alternative to any measure of performance as promulgated under GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP.
Important Note Regarding Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements made in Mr. Van Dyke's quotes and statements relating to our financial condition, market conditions, results of operations, plans, objectives, outlook for earnings, strategic initiatives and related earn-back periods, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality and nonaccrual and nonperforming loans. Forward looking statements are typically identified by words or phrases such as "will likely result," "expect," "anticipate," "estimate," "forecast," "project," "intend," " believe," "assume," "strategy," "trend," "plan," "outlook," "outcome," "continue," "remain," "potential," "opportunity," "comfortable," "current," "position," "maintain," "sustain," "seek," "achieve" and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may.
These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumption that are difficult to predict and often are beyond the Company's control. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. The matters discussed in these forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results and trends to differ materially from those made, projected, or implied in or by the forward-looking statements including, but not limited to the effects of:
- market interest rates and the impacts of market interest rates on economic conditions, customer behavior, and the Company's loan and securities portfolios;
- inflation, market and monetary fluctuations;
- changes in trade, monetary and fiscal policies and laws of the U.S. government, including policies of the Federal Reserve, FDIC and Treasury Department;
- changes in accounting policies, practices, or guidance, for example, our adoption of Current Expected Credit Losses ("CECL") methodology, including potential volatility in the Company's operating results due to application of the CECL methodology;
- cyber-security threats, attacks or events;
- rapid technological developments and changes;
- our ability to resolve our nonperforming assets and our ability to secure collateral on loans that have entered nonaccrual status due to loan maturities and failure to pay in full;
- changes in the Company's liquidity and capital positions;
- concentrations of loans secured by real estate, particularly commercial real estate, and the potential impacts of changes in market conditions on the value of real estate collateral;
- increased delinquency and foreclosure rates on commercial real estate loans;
- an insufficient allowance for credit losses;
- the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, war and other military conflicts (such as the war between Israel and Hamas and the ongoing war between Russia and Ukraine) or public health events (such as the COVID-19 pandemic), and of any governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on the ability of the Company's borrowers to satisfy their obligations to the Company, on the value of collateral securing loans, on the demand for the Company's loans or its other products and services, on incidents of cyberattack and fraud, on the Company's liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of the Company's business operations and on financial markets and economic growth;
- a change in spreads on interest-earning assets and interest-bearing liabilities;
- regulatory supervision and oversight, including our relationship with regulators and any actions that may be initiated by our regulators;
- legislation affecting the financial services industry as a whole (such as the Inflation Reduction Act of 2022), and the Company and the Bank, in particular;
- the outcome of pending and future litigation and/or governmental proceedings, including the outcome of the lawsuit filed against the Bank and its directors by West Virginia Governor James C. Justice, II, his wife Cathy Justice, his son James C. Justice, III and various related entities that he and/or they own and control, concerning their lending relationship with the Bank, and other lawsuits related to the large NPL relationship;
- increasing price and product/service competition;
- the ability to continue to introduce competitive new products and services on a timely, cost-effective basis;
- managing our internal growth and acquisitions;
- the possibility that the anticipated benefits from acquisitions cannot be fully realized in a timely manner or at all, or that integrating the acquired operations will be more difficult, disruptive or more costly than anticipated;
- the soundness of other financial institutions and any indirect exposure related to recent large bank failures and their impact on the broader market through other customers, suppliers and partners or that the conditions which resulted in the liquidity concerns with those failed banks may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships with;
- material increases in costs and expenses;
- reliance on significant customer relationships;
- general economic or business conditions, including unemployment levels, continuing supply chain disruptions and slowdowns in economic growth;
- significant weakening of the local economies in which we operate;
- changes in customer behaviors, including consumer spending, borrowing and saving habits;
- changes in deposit flows and loan demand;
- our failure to attract or retain key employees;
- expansions or consolidations in the Company's branch network, including that the anticipated benefits of the Company's branch network optimization project are not fully realized in a timely manner or at all;
- deterioration of the housing market and reduced demand for mortgages; and
- re-emergence of turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses.
Many of these factors, as well as other factors, are described in our filings with the SEC including in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2023. All risk factors and uncertainties described herein and therein should be considered in evaluating the Company's forward-looking statements. Forward-looking statements are based on beliefs and assumptions using information available at the time the statements are prepared. We caution you not to unduly rely on forward-looking statements because the assumptions, beliefs, expectations and projections about future events are expressed in or implied by a forward-looking statement may, and often do, differ materially from actual results. Any forward-looking statement speaks only as to the date on which it is made, and we undertake no obligation to update, revise or clarify any forward-looking statement to reflect developments occurring after the statement is made.
Carter Bankshares, Inc.
Wendy Bell, 276-656-1776
Senior Executive Vice President & Chief Financial Officer
wendy.bell@CBTCares.com
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
BALANCE SHEETS
| March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||||||
(Dollars in Thousands, except per share data) | (unaudited) | (audited) | (unaudited) | |||||||||
ASSETS | ||||||||||||
Cash and Due From Banks, including Interest-Bearing Deposits of | $ | 108,110 | $ | 54,529 | $ | 81,378 | ||||||
Securities Available-for-Sale, at Fair Value | 768,832 | 779,003 | 862,856 | |||||||||
Loans Held-for-Sale | - | - | 364 | |||||||||
Portfolio Loans | 3,509,071 | 3,505,910 | 3,248,898 | |||||||||
Allowance for Credit Losses | (96,536 | ) | (97,052 | ) | (94,694 | ) | ||||||
Portfolio Loans, net | 3,412,535 | 3,408,858 | 3,154,204 | |||||||||
Bank Premises and Equipment, net | 73,339 | 73,707 | 72,495 | |||||||||
Other Real Estate Owned, net | 2,528 | 2,463 | 8,291 | |||||||||
Federal Home Loan Bank Stock, at Cost | 17,910 | 21,626 | 20,593 | |||||||||
Bank Owned Life Insurance | 58,463 | 58,115 | 57,073 | |||||||||
Other Assets | 113,229 | 114,238 | 108,401 | |||||||||
Total Assets | $ | 4,554,946 | $ | 4,512,539 | $ | 4,365,655 | ||||||
LIABILITIES | ||||||||||||
Deposits: | ||||||||||||
Noninterest-Bearing Demand | $ | 671,981 | $ | 685,218 | $ | 690,914 | ||||||
Interest-Bearing Demand | 515,614 | 481,506 | 500,749 | |||||||||
Money Market | 520,785 | 513,664 | 430,938 | |||||||||
Savings | 427,461 | 454,876 | 606,976 | |||||||||
Certificates of Deposit | 1,694,680 | 1,586,651 | 1,307,411 | |||||||||
Total Deposits | 3,830,521 | 3,721,915 | 3,536,988 | |||||||||
Federal Home Loan Bank Borrowings | 310,500 | 393,400 | 435,135 | |||||||||
Reserve for Unfunded Commitments | 3,150 | 3,193 | 2,377 | |||||||||
Other Liabilities | 51,709 | 42,788 | 36,169 | |||||||||
Total Liabilities | 4,195,880 | 4,161,296 | 4,010,669 | |||||||||
SHAREHOLDERS' EQUITY | ||||||||||||
Common Stock, Par Value | ||||||||||||
23,020,542 outstanding at March 31, 2024, | ||||||||||||
22,956,304 outstanding at December 31, 2023 and 23,895,543 at March 31, 2023 | 23,021 | 22,957 | 23,896 | |||||||||
Additional Paid-in Capital | 90,947 | 90,642 | 102,814 | |||||||||
Retained Earnings | 314,894 | 309,083 | 301,640 | |||||||||
Accumulated Other Comprehensive Loss | (69,796 | ) | (71,439 | ) | (73,364 | ) | ||||||
Total Shareholders' Equity | 359,066 | 351,243 | 354,986 | |||||||||
Total Liabilities and Shareholders' Equity | $ | 4,554,946 | $ | 4,512,539 | $ | 4,365,655 | ||||||
PERFORMANCE RATIOS | ||||||||||||
Return on Average Assets (QTD Annualized) | 0.52 | % | (0.17) | % | 1.51 | % | ||||||
Return on Average Assets (YTD Annualized) | 0.52 | % | 0.53 | % | 1.51 | % | ||||||
Return on Average Shareholders' Equity (QTD Annualized) | 6.59 | % | (2.24) | % | 18.88 | % | ||||||
Return on Average Shareholders' Equity (YTD Annualized) | 6.59 | % | 6.79 | % | 18.88 | % | ||||||
Portfolio Loans to Deposit Ratio | 91.61 | % | 94.20 | % | 91.85 | % | ||||||
Allowance for Credit Losses to Total Portfolio Loans | 2.75 | % | 2.77 | % | 2.91 | % | ||||||
CAPITALIZATION RATIOS | ||||||||||||
Shareholders' Equity to Assets | 7.88 | % | 7.78 | % | 8.13 | % | ||||||
Tier 1 Leverage Ratio | 9.34 | % | 9.48 | % | 10.09 | % | ||||||
Risk-Based Capital - Tier 1 | 10.89 | % | 11.08 | % | 12.28 | % | ||||||
Risk-Based Capital - Total | 12.15 | % | 12.34 | % | 13.55 | % | ||||||
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
INCOME STATEMENTS
| Quarter-to-Date | |||||||||||
| March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
(Dollars in Thousands, except per share data) | (unaudited) | (audited) | (unaudited) | ||||||||
Interest Income | $ | 54,049 | $ | 51,863 | $ | 51,955 | |||||
Interest Expense | 25,630 | 24,443 | 11,170 | ||||||||
NET INTEREST INCOME | 28,419 | 27,420 | 40,785 | ||||||||
Provision for Credit Losses | 16 | 2,895 | 1,415 | ||||||||
(Recovery) Provision for Unfunded Commitments | (43 | ) | 587 | 84 | |||||||
NET INTEREST INCOME AFTER PROVISION (RECOVERY) FOR CREDIT LOSSES | 28,446 | 23,938 | 39,286 | ||||||||
NONINTEREST INCOME | |||||||||||
Losses on Sales of Securities, net | - | (1,511 | ) | (12 | ) | ||||||
Service Charges, Commissions and Fees | 1,875 | 1,775 | 1,838 | ||||||||
Debit Card Interchange Fees | 2,086 | 1,887 | 2,105 | ||||||||
Insurance Commissions | 614 | 395 | 174 | ||||||||
Bank Owned Life Insurance Income | 348 | 353 | 339 | ||||||||
Commercial Loan Swap Fee Income | - | 25 | 116 | ||||||||
Other | 122 | 321 | 175 | ||||||||
TOTAL NONINTEREST INCOME | 5,045 | 3,245 | 4,735 | ||||||||
NONINTEREST EXPENSE | |||||||||||
Salaries and Employee Benefits | 14,200 | 14,599 | 13,652 | ||||||||
Occupancy Expense, net | 3,748 | 3,480 | 3,400 | ||||||||
FDIC Insurance Expense | 1,687 | 2,193 | 641 | ||||||||
Other Taxes | 903 | 846 | 804 | ||||||||
Advertising Expense | 357 | 560 | 339 | ||||||||
Telephone Expense | 417 | 503 | 427 | ||||||||
Professional and Legal Fees | 1,513 | 2,205 | 834 | ||||||||
Data Processing | 891 | 1,066 | 720 | ||||||||
Debit Card Expense | 756 | 809 | 479 | ||||||||
Other | 1,785 | 2,811 | 2,280 | ||||||||
TOTAL NONINTEREST EXPENSE | 26,257 | 29,072 | 23,576 | ||||||||
INCOME (LOSS) BEFORE INCOME TAXES | 7,234 | (1,889 | ) | 20,445 | |||||||
Income Tax Provision (Benefit) | 1,423 | (1 | ) | 4,504 | |||||||
NET INCOME (LOSS) | $ | 5,811 | $ | (1,888 | ) | $ | 15,941 | ||||
Shares Outstanding, at End of Period | 23,020,542 | 22,956,304 | 23,895,543 | ||||||||
Average Shares Outstanding-Basic & Diluted | 22,770,311 | 22,956,114 | 23,770,481 | ||||||||
PER SHARE DATA | |||||||||||
Basic Earnings (Loss) Per Common Share* | $ | 0.25 | $ | (0.08 | ) | $ | 0.67 | ||||
Diluted Earnings (Loss) Per Common Share* | $ | 0.25 | $ | (0.08 | ) | $ | 0.67 | ||||
Book Value | $ | 15.60 | $ | 15.30 | $ | 14.86 | |||||
Market Value | $ | 12.64 | $ | 14.97 | $ | 14.00 | |||||
PROFITABILITY RATIOS (GAAP) | |||||||||||
Net Interest Margin | 2.58 | % | 2.47 | % | 3.95 | % | |||||
Efficiency Ratio | 78.46 | % | 94.81 | % | 51.79 | % | |||||
PROFITABILITY RATIOS (non-GAAP) | |||||||||||
Net Interest Margin (FTE) 3 | 2.60 | % | 2.49 | % | 3.98 | % | |||||
Efficiency Ratio 4 (non-GAAP) | 79.01 | % | 88.48 | % | 51.18 | % | |||||
*All outstanding unvested restricted stock awards are considered participating securities for the earnings per share calculation. As such, these shares have been allocated to a portion of net income and are excluded from the diluted earnings per share calculation.
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
NET INTEREST MARGIN (FTE) (QTD AVERAGES)
(Unaudited)
| March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||||||||||||||||||||||||
(Dollars in Thousands) | Average Balance | Income/ Expense | Rate | Average Balance | Income/ Expense | Rate | Average Balance | Income/ Expense | Rate | |||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||||||
Interest-Bearing Deposits with Banks | $ | 24,129 | $ | 335 | 5.58 | % | $ | 34,849 | $ | 479 | 5.45 | % | $ | 16,135 | $ | 200 | 5.03 | % | ||||||||||||
Tax-Free Investment Securities 3 | 11,818 | 85 | 2.89 | % | 24,548 | 185 | 2.99 | % | 29,094 | 205 | 2.86 | % | ||||||||||||||||||
Taxable Investment Securities | 853,540 | 7,743 | 3.65 | % | 878,127 | 7,930 | 3.58 | % | 920,633 | 7,393 | 3.26 | % | ||||||||||||||||||
Total Securities | 865,358 | 7,828 | 3.64 | % | 902,675 | 8,115 | 3.57 | % | 949,727 | 7,598 | 3.24 | % | ||||||||||||||||||
Tax-Free Loans 3 | 111,471 | 897 | 3.24 | % | 115,744 | 937 | 3.21 | % | 132,742 | 1,053 | 3.22 | % | ||||||||||||||||||
Taxable Loans | 3,407,659 | 44,817 | 5.29 | % | 3,325,930 | 42,082 | 5.02 | % | 3,073,351 | 43,128 | 5.69 | % | ||||||||||||||||||
Total Loans | 3,519,130 | 45,714 | 5.22 | % | 3,441,674 | 43,019 | 4.96 | % | 3,206,093 | 44,181 | 5.59 | % | ||||||||||||||||||
Federal Home Loan Bank Stock | 20,403 | 378 | 7.45 | % | 25,260 | 486 | 7.63 | % | 14,209 | 240 | 6.85 | % | ||||||||||||||||||
Total Interest-Earning Assets | 4,429,020 | 54,255 | 4.93 | % | 4,404,458 | 52,099 | 4.69 | % | 4,186,164 | 52,219 | 5.06 | % | ||||||||||||||||||
Noninterest Earning Assets | 91,171 | 81,581 | 91,539 | |||||||||||||||||||||||||||
Total Assets | $ | 4,520,191 | $ | 4,486,039 | $ | 4,277,703 | ||||||||||||||||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||||||
Interest-Bearing Demand | $ | 496,052 | $ | 1,112 | 0.90 | % | $ | 475,459 | $ | 853 | 0.71 | % | $ | 490,615 | $ | 497 | 0.41 | % | ||||||||||||
Money Market | 524,896 | 3,996 | 3.06 | % | 470,944 | 3,261 | 2.75 | % | 476,798 | 1,254 | 1.07 | % | ||||||||||||||||||
Savings | 439,775 | 137 | 0.13 | % | 468,975 | 130 | 0.11 | % | 642,115 | 165 | 0.10 | % | ||||||||||||||||||
Certificates of Deposit | 1,635,819 | 15,472 | 3.80 | % | 1,546,968 | 13,755 | 3.53 | % | 1,281,598 | 5,603 | 1.77 | % | ||||||||||||||||||
Total Interest-Bearing Deposits | 3,096,542 | 20,717 | 2.69 | % | 2,962,346 | 17,999 | 2.41 | % | 2,891,126 | 7,519 | 1.05 | % | ||||||||||||||||||
Federal Home Loan Bank Borrowings | 366,782 | 4,819 | 5.28 | % | 469,893 | 6,361 | 5.37 | % | 285,563 | 3,395 | 4.82 | % | ||||||||||||||||||
Federal Funds Purchased | - | - | - | % | 969 | 14 | 5.73 | % | 14,349 | 176 | 4.97 | % | ||||||||||||||||||
Other Borrowings | 7,703 | 94 | 4.91 | % | 6,607 | 69 | 4.14 | % | 6,448 | 80 | 5.03 | % | ||||||||||||||||||
Total Borrowings | 374,485 | 4,913 | 5.28 | % | 477,469 | 6,444 | 5.35 | % | 306,360 | 3,651 | 4.83 | % | ||||||||||||||||||
Total Interest-Bearing Liabilities | 3,471,027 | 25,630 | 2.97 | % | 3,439,815 | 24,443 | 2.82 | % | 3,197,486 | 11,170 | 1.42 | % | ||||||||||||||||||
Noninterest-Bearing Liabilities | 694,293 | 711,975 | 737,857 | |||||||||||||||||||||||||||
Shareholders' Equity | 354,871 | 334,249 | 342,360 | |||||||||||||||||||||||||||
Total Liabilities and Shareholders' Equity | $ | 4,520,191 | $ | 4,486,039 | $ | 4,277,703 | ||||||||||||||||||||||||
Net Interest Income 3 | $ | 28,625 | $ | 27,656 | $ | 41,049 | ||||||||||||||||||||||||
Net Interest Margin 3 | 2.60 | % | 2.49 | % | 3.98 | % | ||||||||||||||||||||||||
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
LOANS AND LOANS HELD-FOR-SALE
(Unaudited)
(Dollars in Thousands) | March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
Commercial | ||||||||||||
Commercial Real Estate | $ | 1,728,929 | $ | 1,670,631 | $ | 1,575,675 | ||||||
Commercial and Industrial | 257,176 | 271,511 | 290,293 | |||||||||
Total Commercial Loans | 1,986,105 | 1,942,142 | 1,865,968 | |||||||||
Consumer | ||||||||||||
Residential Mortgages | 788,125 | 787,929 | 675,340 | |||||||||
Other Consumer | 32,428 | 34,277 | 41,308 | |||||||||
Total Consumer Loans | 820,553 | 822,206 | 716,648 | |||||||||
Construction | 397,219 | 436,349 | 361,003 | |||||||||
Other | 305,194 | 305,213 | 305,279 | |||||||||
Total Portfolio Loans | 3,509,071 | 3,505,910 | 3,248,898 | |||||||||
Loans Held-for-Sale | - | - | 364 | |||||||||
Total Loans | $ | 3,509,071 | $ | 3,505,910 | $ | 3,249,262 | ||||||
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
ASSET QUALITY DATA
(Unaudited)
(Dollars in Thousands) | March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
Nonaccrual Loans | ||||||||||||
Commercial Real Estate | $ | 641 | $ | 1,324 | $ | 2,050 | ||||||
Commercial and Industrial | 109 | 52 | 141 | |||||||||
Residential Mortgages | 2,491 | 3,283 | 3,231 | |||||||||
Other Consumer | 50 | 59 | 5 | |||||||||
Construction | 2,093 | 2,904 | 2,941 | |||||||||
Other | 301,913 | 301,913 | - | |||||||||
Total Nonperforming Loans | 307,297 | 309,535 | 8,368 | |||||||||
Other Real Estate Owned | 2,528 | 2,463 | 8,291 | |||||||||
Total Nonperforming Assets | $ | 309,825 | $ | 311,998 | $ | 16,659 | ||||||
Nonperforming Loans to Total Portfolio Loans | 8.76 | % | 8.83 | % | 0.26 | % | ||||||
Nonperforming Assets to Total Portfolio Loans plus Other Real Estate Owned | 8.82 | % | 8.89 | % | 0.51 | % | ||||||
Allowance for Credit Losses to Total Portfolio Loans | 2.75 | % | 2.77 | % | 2.91 | % | ||||||
Allowance for Credit Losses to Nonperforming Loans | 31.41 | % | 31.35 | % | 1,131.62 | % | ||||||
Net Loan Charge-offs (Recoveries) QTD | $ | 532 | $ | 317 | $ | 573 | ||||||
Net Loan Charge-offs (Recoveries) YTD | $ | 532 | $ | 2,300 | $ | 573 | ||||||
Net Loan Charge-offs (Recoveries) (Annualized) to Average Portfolio Loans QTD | 0.06 | % | 0.04 | % | 0.07 | % | ||||||
Net Loan Charge-offs (Recoveries) (Annualized) to Average Portfolio Loans YTD | 0.06 | % | 0.07 | % | 0.07 | % |
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
ALLOWANCE FOR CREDIT LOSSES
(Unaudited)
| Quarter-to-Date | ||||||||||||
(Dollars in Thousands) | March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
Balance Beginning of Period | $ | 97,052 | $ | 94,474 | $ | 93,852 | ||||||
Provision for Credit Losses | 16 | 2,895 | 1,415 | |||||||||
Charge-offs: | ||||||||||||
Commercial Real Estate | - | - | - | |||||||||
Commercial and Industrial | 18 | 12 | 1 | |||||||||
Residential Mortgages | 23 | - | 3 | |||||||||
Other Consumer | 480 | 626 | 657 | |||||||||
Construction | 156 | - | - | |||||||||
Other | - | - | - | |||||||||
Total Charge-offs | 677 | 638 | 661 | |||||||||
Recoveries: | ||||||||||||
Commercial Real Estate | - | - | - | |||||||||
Commercial and Industrial | 1 | 83 | - | |||||||||
Residential Mortgages | 2 | 98 | 1 | |||||||||
Other Consumer | 142 | 140 | 87 | |||||||||
Construction | - | - | - | |||||||||
Other | - | - | - | |||||||||
Total Recoveries | 145 | 321 | 88 | |||||||||
Total Net Charge-offs | 532 | 317 | 573 | |||||||||
Balance End of Period | $ | 96,536 | $ | 97,052 | $ | 94,694 | ||||||
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
DEFINITIONS AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES:
(Unaudited)
1 Pre-tax Pre-provision Income (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands) | March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
Net Interest Income | $ | 28,419 | $ | 27,420 | $ | 40,785 | ||||||
Noninterest Income | 5,045 | 3,245 | 4,735 | |||||||||
Noninterest Expense | 26,257 | 29,072 | 23,576 | |||||||||
Pre-tax Pre-provision Income | 7,207 | 1,593 | 21,944 | |||||||||
Losses on Sales of Securities, net | - | 1,511 | 12 | |||||||||
Losses on Sales and Write-downs of Bank Premises, net | 1 | 19 | 33 | |||||||||
(Gains) Losses on Sales and Write-downs of OREO, net | (342 | ) | 201 | - | ||||||||
OREO Income | (8 | ) | (21 | ) | (16 | ) | ||||||
Associate Separations | - | 192 | - | |||||||||
Contingent Liability | - | - | 115 | |||||||||
Pre-tax Pre-provision Income (Non-GAAP) | $ | 6,858 | $ | 3,495 | $ | 22,088 | ||||||
2 Net Income (Loss) (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands, except per share data) | March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
Net Income (Loss) | $ | 5,811 | $ | (1,888 | ) | $ | 15,941 | |||||
Losses on Sales of Securities, net | - | 1,511 | 12 | |||||||||
Losses on Sales and Write-downs of Bank Premises, net | 1 | 19 | 33 | |||||||||
(Gains) Losses on Sales and Write-downs of OREO, net | (342 | ) | 201 | - | ||||||||
OREO Income | (8 | ) | (21 | ) | (16 | ) | ||||||
Associate Separations | - | 192 | - | |||||||||
Contingent Liability | - | - | 115 | |||||||||
Total Tax Effect | 73 | (399 | ) | (30 | ) | |||||||
Net Income (Loss) (Non-GAAP) | $ | 5,535 | $ | (385 | ) | $ | 16,055 | |||||
Average Shares Outstanding - diluted | 22,770,311 | 22,956,114 | 23,770,481 | |||||||||
Earnings (Loss) Per Common Share (diluted) (Non-GAAP) | $ | 0.24 | $ | (0.02 | ) | $ | 0.68 | |||||
3 Computed on a fully taxable equivalent basis ("FTE") using a
Net Interest Income (FTE) (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands) | March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
Interest Income (FTE)(Non-GAAP) | ||||||||||||
Interest and Dividend Income (GAAP) | $ | 54,049 | $ | 51,863 | $ | 51,955 | ||||||
Tax Equivalent Adjustment 3 | 206 | 236 | 264 | |||||||||
Interest and Dividend Income (FTE) (Non-GAAP) | 54,255 | 52,099 | 52,219 | |||||||||
Average Earning Assets | 4,429,020 | 4,404,458 | 4,186,164 | |||||||||
Yield on Interest-earning Assets (GAAP) | 4.91 | % | 4.67 | % | 5.03 | % | ||||||
Yield on Interest-earning Assets (FTE) (Non-GAAP) | 4.93 | % | 4.69 | % | 5.06 | % | ||||||
Net Interest Income (GAAP) | $ | 28,419 | $ | 27,420 | $ | 40,785 | ||||||
Tax Equivalent Adjustment 3 | 206 | 236 | 264 | |||||||||
Net Interest Income (FTE) (Non-GAAP) | 28,625 | 27,656 | 41,049 | |||||||||
Average Earning Assets | 4,429,020 | 4,404,458 | 4,186,164 | |||||||||
Net Interest Margin (GAAP) | 2.58 | % | 2.47 | % | 3.95 | % | ||||||
Net Interest Margin (FTE) (Non-GAAP) | 2.60 | % | 2.49 | % | 3.98 | % | ||||||
4 Efficiency Ratio (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands) | March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||||
Noninterest Expense | $ | 26,257 | $ | 29,072 | $ | 23,576 | ||||||
Less: Losses on Sales and Write-downs of Bank Premises, net | (1 | ) | (19 | ) | (33 | ) | ||||||
Less: Gains (Losses) on Sales and Write-downs of OREO, net | 342 | (201 | ) | - | ||||||||
Less: Associate Separations | - | (192 | ) | - | ||||||||
Less: Contingent Liability | - | - | (115 | ) | ||||||||
Noninterest Expense (Non-GAAP) | $ | 26,598 | $ | 28,660 | $ | 23,428 | ||||||
Net Interest Income | $ | 28,419 | $ | 27,420 | $ | 40,785 | ||||||
Plus: Taxable Equivalent Adjustment 3 | 206 | 236 | 264 | |||||||||
Net Interest Income (FTE) (Non-GAAP) | 28,625 | 27,656 | 41,049 | |||||||||
Less: Losses on Sales of Securities, net | - | 1,511 | 12 | |||||||||
Less: OREO Income | (8 | ) | (21 | ) | (16 | ) | ||||||
Noninterest Income | 5,045 | 3,245 | 4,735 | |||||||||
Net Interest Income (FTE) (Non-GAAP) plus Noninterest Income | $ | 33,662 | $ | 32,391 | $ | 45,780 | ||||||
Efficiency Ratio (GAAP) | 78.46 | % | 94.81 | % | 51.79 | % | ||||||
Efficiency Ratio (Non-GAAP) | 79.01 | % | 88.48 | % | 51.18 | % | ||||||
SOURCE: Carter Bankshares, Inc.
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FAQ
What was Carter Bankshares, Inc.'s quarterly net income for the first quarter of 2024?
What was the pre-tax pre-provision income for Carter Bankshares, Inc. in the first quarter of 2024?
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Did Carter Bankshares, Inc. experience growth in total portfolio loans for the first quarter of 2024?
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