City Holding Company Announces Quarterly Results

Rhea-AI Summary

City Holding Company (NASDAQ:CHCO) reported a quarterly net income of $21.3 million, translating to diluted earnings of $1.41 per share for Q1 2022. However, net interest income fell by 6.7% to $37.9 million, largely due to a decrease in commercial loan yields. The credit quality remained stable, with nonperforming assets slightly decreasing to 0.18% of total loans. Non-interest income rose by 10.8% year-over-year, driven by service charges. The company's tangible equity ratio decreased from 9.6% to 8.8%, but remains well-capitalized above regulatory requirements.

Positive

• Non-interest income increased by 10.8% year-over-year to $17.4 million.
• Credit quality remained stable with nonperforming assets at 0.18%.

Negative

• Net interest income decreased by 6.7% from the previous quarter.
• Tangible equity ratio declined from 9.6% to 8.8%.

CHARLESTON, W. Va.--(BUSINESS WIRE)-- City Holding Company (“Company” or “City”) (NASDAQ:CHCO), a $6.0 billion bank holding company headquartered in Charleston, West Virginia, today announced quarterly net income of $21.3 million and diluted earnings of $1.41 per share for the quarter ended March 31, 2022.

Net Interest Income

The Company’s net interest income decreased $2.7 million, or 6.7%, from $40.6 million during the fourth quarter of 2021 to $37.9 million during the first quarter of 2022. The Company’s tax equivalent net interest income decreased $2.7 million, or 6.6%, from $41.0 million for the fourth quarter of 2021 to $38.2 million for the first quarter of 2022. Lower commercial loan yields (44 basis points) decreased interest income by $2.3 million as compared to the quarter ended December 31, 2021. The fourth quarter of 2021 was boosted by an interest recovery of $2.1 million from a loan that had previously been classified as a nonperforming loan. In addition, loan fees decreased $0.8 million due to a decrease in PPP loan fees recognized as PPP loan balances declined to below $1 million at March 31, 2022. These decreases were partially offset by higher investment interest income ($0.5 million) due to both higher yields (14 basis points) and higher average balances ($29 million) during the quarter ended March 31, 2022. The Company’s reported net interest margin decreased from 2.94% for the fourth quarter of 2021 to 2.82% for the first quarter of 2022.

Credit Quality

The Company’s ratio of nonperforming assets to total loans and other real estate owned decreased modestly from 0.21%, or $7.6 million, at December 31, 2021 to 0.18%, or $6.3 million, at March 31, 2022. Total past due loans decreased slightly from $6.8 million, or 0.19% of total loans outstanding, at December 31, 2021 to $6.7 million, or 0.19% of total loans outstanding, at March 31, 2022.

As a result of the Company’s quarterly analysis of the adequacy of the allowance for credit losses (“ACL”), the Company recorded a recovery of credit losses of $0.8 million in the first quarter of 2022, compared to a recovery of credit losses of $0.4 million for the comparable period in 2021, and did not record a provision for credit losses for the fourth quarter of 2021. The recovery of credit losses recorded in the first quarter of 2022 largely reflects the repayment of a loan from a previous acquisition and release of the associated credit mark. Because of continued improvements in economic conditions in the Company’s footprint, net charge-offs for the quarter ended March 31, 2022 were insignificant.

Non-interest Income

Non-interest income was $17.4 million during the quarter ended March 31, 2022, as compared to $16.6 million during the quarter ended March 31, 2021. During the first quarter of 2022, the Company reported $0.7 million of unrealized fair value losses on the Company’s equity securities compared to $0.2 million of realized and unrealized fair value gains on the Company’s equity securities during the first quarter of 2021. Exclusive of these items, non-interest income increased $1.8 million, or 10.8%, from $16.4 million for the first quarter of 2021 to $18.2 million for the first quarter of 2022. This increase was largely attributable to an increase of $0.8 million, or 14.4%, in service charges and an increase of $0.6 million in bank owned life insurance due to higher death benefit proceeds. In addition, bankcard revenue increased $0.2 million from the quarter ended March 31, 2021, to $6.4 million.

Non-interest Expenses

Non-interest expenses decreased $0.3 million, or 0.9%, from $29.8 million in the first quarter of 2021 to $29.5 million in the first quarter of 2022. This decrease was primarily due to a decrease in other expenses of $0.2 million from the quarter ended March 31, 2021. During the first quarter of 2022, most of the Company’s expenses did not significantly fluctuate from the first quarter of 2021; although we do anticipate salaries and employee benefits will increase in subsequent quarters.

Balance Sheet Trends

Loans increased $16.1 million (0.5%) from December 31, 2021 to $3.56 billion at March 31, 2022. PPP loans decreased $6.0 million from $6.6 million at December 31, 2021 to $0.6 million at March 31, 2022. Excluding outstanding PPP loans (included in the commercial and industrial loan category), total loans increased $22.1 million, (0.6%), from December 31, 2021 to $3.56 billion at March 31, 2022. Residential real estate loans increased $39.9 million (2.6%). This increase was partially offset by lower commercial real estate loans ($9.0 million, or 0.6%); lower DDA overdrafts ($4.0 million, or 62.1%); and lower commercial and industrial loans ($2.8 million, or 0.8%) (excluding PPP loans).

Total average depository balances increased $39.3 million, or 0.8%, from the quarter ended December 31, 2021 to the quarter ended March 31, 2022. Average savings deposit balances increased $45.7 million, average interest-bearing demand deposit balances increased $28.6 million, and noninterest-bearing demand deposit balances increased $4.1 million. These increases were partially offset by a decrease in time deposit balances of $39.1 million.

Income Tax Expense

The Company’s effective income tax rate for the first quarter of 2022 was 19.7% compared to 20.8% for the year ended December 31, 2021, and 20.1% for the quarter ended March 31, 2021.

Capitalization and Liquidity

The Company’s loan to deposit ratio was 71.2% and the loan to asset ratio was 59.2% at March 31, 2022. The Company maintained investment securities totaling 23.9% of assets as of the same date. The Company’s deposit mix is weighted heavily toward checking and saving accounts, which fund 66.1% of assets at March 31, 2022. Time deposits fund 17.0% of assets at March 31, 2022, but very few of these deposits are in accounts that have balances of more than $250,000, reflecting the core retail orientation of the Company.

The Company continues to be strongly capitalized with tangible equity of $516 million at March 31, 2022. Due primarily to unrealized security losses during the quarter ended March 31, 2022, the Company’s tangible equity ratio decreased from 9.6% at December 31, 2021 to 8.8% at March 31, 2022. At March 31, 2022, City National Bank’s Leverage Ratio was 8.80%, its Common Equity Tier I ratio was 14.82%, its Tier I Capital ratio was 14.82%, and its Total Risk-Based Capital ratio was 15.24%. These regulatory capital ratios are significantly above levels required to be considered “well capitalized,” which is the highest possible regulatory designation.

On March 30, 2022, the Board of Directors of the Company approved a quarterly cash dividend of $0.60 per share payable April 29, 2022, to shareholders of record as of April 15, 2022. During the quarter ended March 31, 2022, the Company repurchased 38,000 common shares at a weighted average price of $78.09 per share as part of a one million share repurchase plan authorized by the Board of Directors in March 2021. As of March 31, 2022, the Company could repurchase 277,000 additional shares under the current program.

City Holding Company is the parent company of City National Bank of West Virginia. City National Bank operates 94 branches across West Virginia, Kentucky, Virginia, and Ohio.

Forward-Looking Information

This news release contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements express only management’s beliefs regarding future results or events and are subject to inherent uncertainty, risks, and changes in circumstances, many of which are outside of management’s control. Uncertainty, risks, changes in circumstances and other factors could cause the Company’s actual results to differ materially from those projected in the forward-looking statements. Factors that could cause actual results to differ from those discussed in such forward-looking statements include, but are not limited to those set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 under “ITEM 1A Risk Factors” and the following: (1) general economic conditions, especially in the communities and markets in which we conduct our business; (2) the uncertainties on the Company’s business, results of operations and financial condition, caused by the COVID-19 pandemic, which will depend on several factors, including the scope and duration of the pandemic, its continued influence on financial markets, the effectiveness of the Company’s work from home arrangements and staffing levels in operational facilities, the impact of market participants on which the Company relies and actions taken by governmental authorities and other third parties in response to the pandemic; (3) credit risk, including risk that negative credit quality trends may lead to a deterioration of asset quality, risk that our allowance for loan losses may not be sufficient to absorb actual losses in our loan portfolio, and risk from concentrations in our loan portfolio; (4) changes in the real estate market, including the value of collateral securing portions of our loan portfolio; (5) changes in the interest rate environment; (6) operational risk, including cybersecurity risk and risk of fraud, data processing system failures, and network breaches; (7) changes in technology and increased competition, including competition from non-bank financial institutions; (8) changes in consumer preferences, spending and borrowing habits, demand for our products and services, and customers’ performance and creditworthiness; (9) difficulty growing loan and deposit balances; (10) our ability to effectively execute our business plan, including with respect to future acquisitions; (11) changes in regulations, laws, taxes, government policies, monetary policies and accounting policies affecting bank holding companies and their subsidiaries; (12) deterioration in the financial condition of the U.S. banking system may impact the valuations of investments the Company has made in the securities of other financial institutions; (13) regulatory enforcement actions and adverse legal actions; (14) difficulty attracting and retaining key employees; (15) other economic, competitive, technological, operational, governmental, regulatory, and market factors affecting our operations. Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist stockholders and potential investors in understanding current and anticipated financial operations of the Company and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made. Further, the Company is required to evaluate subsequent events through the filing of its March 31, 2022 Form 10-Q. The Company will continue to evaluate the impact of any subsequent events on the preliminary March 31, 2022 results and will adjust the amounts if necessary.

CITY HOLDING COMPANY AND SUBSIDIARIES
Financial Highlights
(Unaudited)
		Three Months Ended
		March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021				March 31, 2021
Earnings
Net Interest Income (fully taxable equivalent)		$	38,239			$	40,956			$	39,822			$	38,257			$	37,871
Net Income available to common shareholders			21,342				23,386				22,732				22,148				19,814
Per Share Data
Earnings per share available to common shareholders:
Basic		$	1.41			$	1.54			$	1.47			$	1.41			$	1.25
Diluted			1.41				1.54				1.47				1.41				1.25
Weighted average number of shares (in thousands):
Basic			14,974				15,026				15,279				15,573				15,656
Diluted			15,002				15,056				15,302				15,594				15,687
Period-end number of shares (in thousands)			15,045				15,062				15,192				15,527				15,724
Cash dividends declared		$	0.60			$	0.60			$	0.58			$	0.58			$	0.58
Book value per share (period-end)		$	42.03			$	45.22			$	44.58			$	44.79			$	43.99
Tangible book value per share (period-end)			34.27				37.44				36.85				37.20				36.47
Market data:
High closing price		$	85.99			$	83.14			$	79.99			$	83.85			$	87.41
Low closing price			76.82				76.52				72.29				74.44				69.05
Period-end closing price			78.70				81.79				77.91				75.24				81.78
Average daily volume (in thousands)			59				52				53				61				63
Treasury share activity:
Treasury shares repurchased (in thousands)			38				131				337				217				75
Average treasury share repurchase price		$	78.09			$	78.93			$	75.65			$	78.75			$	76.71
Key Ratios (percent)
Return on average assets			1.42	%			1.56	%			1.53	%			1.49	%			1.38	%
Return on average tangible equity			15.3	%			16.7	%			15.7	%			15.2	%			13.5	%
Yield on interest earning assets			2.94	%			3.08	%			3.04	%			3.00	%			3.17	%
Cost of interest bearing liabilities			0.17	%			0.19	%			0.22	%			0.27	%			0.37	%
Net Interest Margin			2.82	%			2.94	%			2.89	%			2.81	%			2.91	%
Non-interest income as a percent of total revenue			32.4	%			30.2	%			31.1	%			31.0	%			30.4	%
Efficiency Ratio			51.7	%			48.3	%			50.0	%			52.8	%			54.3	%
Price/Earnings Ratio (a)			13.93				13.27				13.22				13.35				16.30
Capital (period-end)
Average Shareholders' Equity to Average Assets			11.25	%			11.25	%			11.69	%			11.81	%			12.30	%
Tangible equity to tangible assets			8.75	%			9.58	%			9.59	%			9.98	%			9.93	%
Consolidated City Holding Company risk based capital ratios (b):
CET I			16.18	%			16.08	%			16.11	%			16.40	%			16.76	%
Tier I			16.18	%			16.08	%			16.11	%			16.40	%			16.76	%
Total			16.60	%			16.51	%			16.56	%			16.88	%			17.33	%
Leverage			9.58	%			9.44	%			9.46	%			9.70	%			10.06	%
City National Bank risk based capital ratios (b):
CET I			14.82	%			14.35	%			14.76	%			14.82	%			14.75	%
Tier I			14.82	%			14.35	%			14.76	%			14.82	%			14.75	%
Total			15.24	%			14.78	%			15.21	%			15.30	%			15.33	%
Leverage			8.80	%			8.45	%			8.73	%			8.80	%			8.91	%
Other (period-end)
Branches			94				94				94				94				94
FTE			897				905				921				912				916
Assets per FTE (in thousands)		$	6,703			$	6,637			$	6,463			$	6,477			$	6,434
Deposits per FTE (in thousands)			5,574				5,445				5,308				5,271				5,236
(a) The price/earnings ratio is computed based on annualized quarterly earnings.
(b) March 31, 2022 risk-based capital ratios are estimated.

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Statements of Income
(Unaudited) ($ in 000s, except per share data)
		Three Months Ended
		March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021				March 31, 2021
Interest Income
Interest and fees on loans		$	31,874			$	35,277			$	33,961			$	33,114			$	34,324
Interest on investment securities:
Taxable			6,223				5,753				6,144				5,932				5,242
Tax-exempt			1,216				1,226				1,257				1,291				1,253
Interest on deposits in depository institutions			238				217				196				162				118
Total Interest Income			39,551				42,473				41,558				40,499				40,937
Interest Expense
Interest on deposits			1,521				1,710				1,955				2,460				3,280
Interest on short-term borrowings			114				132				115				125				117
Total Interest Expense			1,635				1,842				2,070				2,585				3,397
Net Interest Income			37,916				40,631				39,488				37,914				37,540
(Recovery of) provision for credit losses			(756	)			-				(725	)			(2,000	)			(440	)
Net Interest Income After (Recovery of) Provision for Credit Losses			38,672				40,631				40,213				39,914				37,980
Non-Interest Income
Net gains on sale of investment securities			-				-				-				29				283
Unrealized (losses) gains recognized on equity securities still held			(723	)			52				93				410				(51	)
Service charges			6,725				7,057				6,706				5,895				5,881
Bankcard revenue			6,444				6,762				6,791				7,221				6,213
Trust and investment management fee income			2,197				2,198				2,172				2,012				2,033
Bank owned life insurance			2,014				748				747				940				1,460
Other income			791				799				1,438				941				811
Total Non-Interest Income			17,448				17,616				17,947				17,448				16,630
Non-Interest Expense
Salaries and employee benefits			15,577				15,299				15,321				15,559				15,671
Occupancy related expense			2,709				2,429				2,507				2,525				2,622
Equipment and software related expense			2,769				2,733				2,554				2,655				2,544
FDIC insurance expense			435				400				396				382				405
Advertising			798				582				804				824				881
Bankcard expenses			1,606				1,576				1,549				1,746				1,584
Postage, delivery, and statement mailings			636				590				573				568				592
Office supplies			410				378				406				371				392
Legal and professional fees			527				405				610				589				675
Telecommunications			584				702				790				676				690
Repossessed asset losses (gains), net of expenses			40				(29	)			(108	)			1				79
Other expenses			3,436				3,559				3,776				3,678				3,674
Total Non-Interest Expense			29,527				28,624				29,178				29,574				29,809
Income Before Income Taxes			26,593				29,623				28,982				27,788				24,801
Income tax expense			5,251				6,237				6,250				5,640				4,987
Net Income Available to Common Shareholders		$	21,342			$	23,386			$	22,732			$	22,148			$	19,814
Distributed earnings allocated to common shareholders		$	8,943			$	8,949			$	8,726			$	8,921			$	9,037
Undistributed earnings allocated to common shareholders			12,199				14,211				13,786				13,021				10,598
Net earnings allocated to common shareholders		$	21,142			$	23,160			$	22,512			$	21,942			$	19,635
Average common shares outstanding			14,974				15,026				15,279				15,573				15,656
Shares for diluted earnings per share			15,002				15,056				15,302				15,594				15,687
Basic earnings per common share		$	1.41			$	1.54			$	1.47			$	1.41			$	1.25
Diluted earnings per common share		$	1.41			$	1.54			$	1.47			$	1.41			$	1.25

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Balance Sheets
($ in 000s)
		(Unaudited)								(Unaudited)				(Unaudited)				(Unaudited)
		March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021				March 31, 2021
Assets
Cash and due from banks		$	100,877			$	101,804			$	103,841			$	97,523			$	97,709
Interest-bearing deposits in depository institutions			497,171				532,827				535,708				512,367				659,090
Cash and cash equivalents			598,048				634,631				639,549				609,890				756,799
Investment securities available-for-sale, at fair value			1,409,513				1,408,165				1,372,077				1,339,436				1,183,253
Other securities			24,785				25,531				25,497				25,793				29,174
Total investment securities			1,434,298				1,433,696				1,397,574				1,365,229				1,212,427
Gross loans			3,559,905				3,543,814				3,521,925				3,529,416				3,546,723
Allowance for credit losses			(17,280	)			(18,166	)			(18,751	)			(20,016	)			(24,076	)
Net loans			3,542,625				3,525,648				3,503,174				3,509,400				3,522,647
Bank owned life insurance			120,522				120,978				120,238				119,491				118,976
Premises and equipment, net			73,067				74,071				75,156				76,263				76,529
Accrued interest receivable			16,101				15,627				16,224				15,967				16,231
Net deferred tax assets			18,001				63				90				-				1,395
Intangible assets			116,774				117,121				117,489				117,857				118,224
Other assets			92,331				81,860				82,419				89,958				71,142
Total Assets		$	6,011,767			$	6,003,695			$	5,951,913			$	5,904,055			$	5,894,370
Liabilities
Deposits:
Noninterest-bearing		$	1,357,266			$	1,373,125			$	1,311,464			$	1,279,932			$	1,244,175
Interest-bearing:
Demand deposits			1,191,492				1,135,848				1,139,033				1,070,004				1,077,749
Savings deposits			1,425,528				1,347,448				1,332,910				1,301,219				1,265,038
Time deposits			1,024,559				1,068,915				1,104,069				1,153,391				1,209,873
Total deposits			4,998,845				4,925,336				4,887,476				4,804,546				4,796,835
Short-term borrowings
Customer repurchase agreements			288,483				312,458				296,642				311,316				316,003
Net deferred tax liabilities			-				-				-				2,310				-
Other liabilities			92,009				84,796				90,499				90,407				89,847
Total Liabilities			5,379,337				5,322,590				5,274,617				5,208,579				5,202,685
Stockholders' Equity
Preferred stock			-				-				-				-				-
Common stock			47,619				47,619				47,619				47,619				47,619
Capital surplus			170,206				170,942				170,300				169,674				170,526
Retained earnings			654,138				641,826				627,463				613,553				600,396
Cost of common stock in treasury			(194,819	)			(193,542	)			(183,303	)			(157,936	)			(142,484	)
Accumulated other comprehensive (loss) income:
Unrealized (loss) gain on securities available-for-sale			(41,229	)			17,745				20,878				28,227				21,289
Underfunded pension liability			(3,485	)			(3,485	)			(5,661	)			(5,661	)			(5,661	)
Total Accumulated Other Comprehensive (Loss) Income			(44,714	)			14,260				15,217				22,566				15,628
Total Stockholders' Equity			632,430				681,105				677,296				695,476				691,685
Total Liabilities and Stockholders' Equity		$	6,011,767			$	6,003,695			$	5,951,913			$	5,904,055			$	5,894,370
Regulatory Capital
Total CET 1 capital		$	565,048			$	555,532			$	550,426			$	561,317			$	563,523
Total tier 1 capital			565,048				555,532				550,426				561,317				563,523
Total risk-based capital			579,807				570,336				565,712				577,543				582,816
Total risk-weighted assets			3,492,920				3,453,893				3,417,020				3,421,764				3,362,595

CITY HOLDING COMPANY AND SUBSIDIARIES
Loan Portfolio
(Unaudited) ($ in 000s)
		March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Commercial and industrial		$	337,384		$	346,184		$	353,046		$	358,583		$	371,195
1-4 Family			108,424			107,873			108,913			108,079			108,131
Hotels			314,902			311,315			297,341			290,119			293,176
Multi-family			209,359			215,677			215,307			212,715			212,561
Non Residential Non-Owner Occupied			637,092			639,818			664,365			653,264			649,683
Non Residential Owner Occupied			200,180			204,233			205,579			209,100			199,130
Commercial real estate (1)			1,469,957			1,478,916			1,491,505			1,473,277			1,462,681
Residential real estate (2)			1,588,860			1,548,965			1,506,572			1,521,102			1,532,907
Home equity			121,460			122,345			124,806			127,608			130,009
Consumer			39,778			40,901			43,296			45,184			47,224
DDA overdrafts			2,466			6,503			2,700			3,662			2,707
Gross Loans		$	3,559,905		$	3,543,814		$	3,521,925		$	3,529,416		$	3,546,723
Construction loans included in:
(1) - Commercial real estate loans		$	14,877		$	11,783		$	19,360		$	43,904		$	39,101
(2) - Residential real estate loans			16,253			17,252			19,059			20,838			22,129

CITY HOLDING COMPANY AND SUBSIDIARIES
Asset Quality Information
(Unaudited) ($ in 000s)
		Three Months Ended
		March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021				March 31, 2021
Allowance for Credit Losses
Balance at beginning of period		$	18,166			$	18,751			$	20,016			$	24,076			$	24,549
Charge-offs:
Commercial and industrial			(34	)			-				-				(211	)			(34	)
Commercial real estate			-				(276	)			(392	)			(1,718	)			(1	)
Residential real estate			(50	)			(68	)			(18	)			(86	)			(93	)
Home equity			-				(58	)			(47	)			(8	)			(64	)
Consumer			(23	)			(13	)			(3	)			(79	)			(147	)
DDA overdrafts			(631	)			(635	)			(633	)			(430	)			(453	)
Total charge-offs			(738	)			(1,050	)			(1,093	)			(2,532	)			(792	)
Recoveries:
Commercial and industrial			59				31				69				25				46
Commercial real estate			53				27				18				15				164
Residential real estate			45				7				29				17				74
Home equity			17				6				58				3				23
Consumer			28				40				72				104				39
DDA overdrafts			406				354				307				308				413
Total recoveries			608				465				553				472				759
Net charge-offs			(130	)			(585	)			(540	)			(2,060	)			(33	)
(Recovery of) provision for credit losses			(756	)			-				(725	)			(2,000	)			(440	)
Balance at end of period		$	17,280			$	18,166			$	18,751			$	20,016			$	24,076
Loans outstanding		$	3,559,905			$	3,543,814			$	3,521,925			$	3,529,416			$	3,546,723
Allowance as a percent of loans outstanding			0.49	%			0.51	%			0.53	%			0.57	%			0.68	%
Allowance as a percent of non-performing loans			331.3	%			290.1	%			243.1	%			199.3	%			194.5	%
Average loans outstanding		$	3,527,393			$	3,522,272			$	3,535,497			$	3,541,165			$	3,585,790
Net charge-offs (annualized) as a percent of average loans outstanding			0.01	%			0.07	%			0.06	%			0.23	%			0.00	%

CITY HOLDING COMPANY AND SUBSIDIARIES
Asset Quality Information, continued
(Unaudited) ($ in 000s)
		March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021				March 31, 2021
Nonaccrual Loans
Residential real estate		$	1,786			$	2,809			$	3,634			$	2,482			$	3,004
Home equity			99				40				67				81				88
Commercial and industrial			1,069				996				531				820				1,200
Commercial real estate			2,241				2,373				3,355				6,383				7,792
Consumer			-				-				-				-				-
Total nonaccrual loans			5,195				6,218				7,587				9,766				12,084
Accruing loans past due 90 days or more			21				43				127				278				295
Total non-performing loans			5,216				6,261				7,714				10,044				12,379
Other real estate owned			1,099				1,319				1,335				1,309				1,625
Total non-performing assets		$	6,315			$	7,580			$	9,049			$	11,353			$	14,004
Non-performing assets as a percent of loans and other real estate owned			0.18	%			0.21	%			0.26	%			0.32	%			0.39	%
Past Due Loans
Residential real estate		$	4,976			$	5,321			$	5,258			$	5,453			$	4,092
Home equity			505				618				688				523				449
Commercial and industrial			56				336				455				721				1,358
Commercial real estate			744				22				441				498				508
Consumer			32				60				35				12				10
DDA overdrafts			392				489				390				417				212
Total past due loans		$	6,705			$	6,846			$	7,267			$	7,624			$	6,629
Total past due loans as a percent of loans outstanding			0.19	%			0.19	%			0.21	%			0.22	%			0.19	%
Troubled Debt Restructurings ("TDRs")
Residential real estate		$	16,182			$	16,943			$	16,910			$	17,788			$	18,572
Home equity			1,694				1,784				1,822				1,920				1,956
Commercial and industrial			397				414				430				-				-
Commercial real estate			1,890				1,914				1,937				3,076				4,615
Consumer			194				225				221				203				211
Total TDRs		$	20,357			$	21,280			$	21,320			$	22,987			$	25,354

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Average Balance Sheets, Yields, and Rates
(Unaudited) ($ in 000s)
		Three Months Ended
		March 31, 2022										December 31, 2021										March 31, 2021
		Average							Yield/			Average							Yield/			Average							Yield/
		Balance				Interest			Rate			Balance				Interest			Rate			Balance				Interest			Rate
Assets:
Loan portfolio (1):
Residential real estate (2)		$	1,667,683			$	15,596		3.79	%		$	1,645,167			$	15,692		3.78	%		$	1,696,064			$	16,853		4.03	%
Commercial, financial, and agriculture (2)			1,815,549				15,532		3.47	%			1,831,461				18,740		4.06	%			1,838,928				16,542		3.65	%
Installment loans to individuals (2), (3)			44,161				607		5.57	%			45,644				691		6.01	%			50,798				713		5.69	%
Previously securitized loans (4)		***					139		***			***					154		***			***					215		***
Total loans			3,527,393				31,874		3.66	%			3,522,272				35,277		3.97	%			3,585,790				34,323		3.88	%
Securities:
Taxable			1,207,333				6,223		2.09	%			1,171,340				5,753		1.95	%			945,177				5,242		2.25	%
Tax-exempt (5)			232,474				1,539		2.68	%			239,096				1,551		2.57	%			239,589				1,585		2.68	%
Total securities			1,439,807				7,762		2.19	%			1,410,436				7,304		2.05	%			1,184,766				6,827		2.34	%
Deposits in depository institutions			540,197				238		0.18	%			588,678				217		0.15	%			513,469				118		0.09	%
Total interest-earning assets			5,507,397				39,874		2.94	%			5,521,386				42,798		3.08	%			5,284,025				41,268		3.17	%
Cash and due from banks			101,806										98,111										79,683
Premises and equipment, net			73,827										74,847										76,837
Goodwill and intangible assets			116,994										117,349										118,453
Other assets			217,662										216,780										217,453
Less: Allowance for credit losses			(18,454	)									(18,756	)									(24,909	)
Total assets		$	5,999,232									$	6,009,717									$	5,751,542
Liabilities:
Interest-bearing demand deposits		$	1,142,278			$	130		0.05	%		$	1,113,693			$	131		0.05	%		$	1,008,283			$	124		0.05	%
Savings deposits			1,384,460				175		0.05	%			1,338,747				173		0.05	%			1,221,169				183		0.06	%
Time deposits (2)			1,048,185				1,216		0.47	%			1,087,280				1,406		0.51	%			1,236,197				2,973		0.98	%
Short-term borrowings			276,360				114		0.17	%			314,937				132		0.17	%			290,766				117		0.16	%
Total interest-bearing liabilities			3,851,283				1,635		0.17	%			3,854,657				1,842		0.19	%			3,756,415				3,397		0.37	%
Noninterest-bearing demand deposits			1,398,663										1,394,599										1,197,910
Other liabilities			74,084										84,071										89,695
Stockholders' equity			675,202										676,390										707,522
Total liabilities and
stockholders' equity		$	5,999,232									$	6,009,717									$	5,751,542
Net interest income						$	38,239									$	40,956									$	37,871
Net yield on earning assets									2.82	%									2.94	%									2.91	%
(1) For purposes of this table, non-accruing loans have been included in average balances and the following amounts (in thousands) of net loan fees have been included in interest income:
Loan fees, net						$	298									$	1,106									$	835
(2) Included in the above table are the following amounts (in thousands) for the accretion of the fair value adjustments related to the Company's acquisitions:
Residential real estate						$	90									$	149									$	106
Commercial, financial, and agriculture							286										243										325
Installment loans to individuals							19										15										28
Time deposits							21										48										48
						$	416									$	455									$	507
(3) Includes the Company’s consumer and DDA overdrafts loan categories.
(4) Effective January 1, 2012, the carrying value of the Company's previously securitized loans was reduced to $0.
(5) Computed on a fully federal tax-equivalent basis assuming a tax rate of approximately 21%.

CITY HOLDING COMPANY AND SUBSIDIARIES
Non-GAAP Reconciliations
(Unaudited) ($ in 000s, except per share data)
		Three Months Ended
		March 31, 2022				December 31, 2021				September 30, 2021				June 30, 2021				March 31, 2021
Net Interest Income/Margin
Net interest income ("GAAP")		$	37,916			$	40,631			$	39,488			$	37,914			$	37,540
Taxable equivalent adjustment			323				325				334				343				331
Net interest income, fully taxable equivalent		$	38,239			$	40,956			$	39,822			$	38,257			$	37,871
Average interest earning assets		$	5,507,397			$	5,521,386			$	5,462,410			$	5,459,564			$	5,284,025
Net Interest Margin			2.82	%			2.94	%			2.89	%			2.81	%			2.91	%
Accretion related to fair value adjustments			-0.03	%			-0.03	%			-0.04	%			-0.05	%			-0.04	%
Net Interest Margin (excluding accretion)			2.79	%			2.91	%			2.85	%			2.76	%			2.87	%
Tangible Equity Ratio (period end)
Equity to assets ("GAAP")			10.52	%			11.34	%			11.37	%			11.78	%			11.74	%
Effect of goodwill and other intangibles, net			-1.77	%			-1.76	%			-1.78	%			-1.80	%			-1.81	%
Tangible common equity to tangible assets			8.75	%			9.58	%			9.59	%			9.98	%			9.93	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220419005771/en/

David L. Bumgarner, Executive Vice President and Chief Financial Officer

(304) 769-1169

Source: City Holding Company

FAQ

What was City Holding Company's net income for the first quarter of 2022?

City Holding Company reported a net income of $21.3 million for Q1 2022.

How much did the net interest income decrease in Q1 2022 for CHCO?

Net interest income for City Holding Company decreased by 6.7% to $37.9 million in Q1 2022.

What is the current state of credit quality for City Holding Company?

Credit quality remained stable, with nonperforming assets decreasing to 0.18% of total loans as of March 31, 2022.

How did non-interest income perform for CHCO in Q1 2022?

Non-interest income increased by 10.8% year-over-year, reaching $17.4 million for Q1 2022.

What was the tangible equity ratio for City Holding Company in Q1 2022?

The tangible equity ratio for City Holding Company decreased to 8.8% in Q1 2022.