Elmira Savings Bank Reports First Quarter Earnings

Rhea-AI Summary

Elmira Savings Bank (NASDAQ:ESBK) reported a net income of $1,204,000 for Q1 2021, up 18.3% from $1,018,000 in Q1 2020. Diluted EPS rose to $0.34 from $0.29. Return on average assets improved to 0.75% and return on average equity increased to 7.93%. Net interest margin grew to 3.57%, while total assets reached $659.3 million. However, loan loss reserves were notably increased due to economic uncertainties from COVID-19, amid a 0.3% decrease in loans receivable.

Positive

• Net income increased by 18.3% to $1,204,000.
• Diluted EPS rose to $0.34 from $0.29.
• Return on average assets improved to 0.75%.
• Return on average equity increased to 7.93%.
• Net interest margin grew to 3.57%.
• Total assets increased by 2.3% to $659.3 million.

Negative

• Increased provision for loan losses due to COVID-19 uncertainties.
• Loans receivable decreased by 0.3%.
• Nonperforming loans to total loans ratio rose to 1.13%.

ELMIRA, N.Y., April 27, 2021 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

• Net income was $1,204,000 for the three months ended March 31, 2021 compared to $1,018,000 for the same period in 2020.
  
  
• Diluted earnings per share were $.34 per share for the three months ended March 31, 2021 compared to $.29 per share for the same period in 2020.
  
  
• Return on average assets was .75% for the three months ended March 31, 2021 and .68% for the same period in 2020.
  
  
• Return on average equity was 7.93% for the three months ended March 31, 2021 compared to 6.93% for the same period in 2020.
  

“We are pleased to report an increase in first quarter net income year-to-year, while at the same time continuing to increase our loan loss reserves in response to the continuing economic uncertainty resulting from the ongoing pandemic,” said Thomas M Carr, President and CEO. Carr continued, “We continue to be concerned about the economic impact in our region from the pandemic, but we are dedicated to continuing to provide the financial services needed in the communities we serve, balancing those efforts with prudent safety measures to minimize potential COVID health risks to our customers and staff.”

Net Income

Net income totaled $1,204,000 for the three months ended March 31, 2021, an increase of $186,000 or 18.3% from the $1,018,000 recorded for the same period in 2020. This increase was the net result of an increase in net interest income of $240,000 and an increase in noninterest income of $786,000, offset by an increase in the provision for loan losses of $100,000, an increase in noninterest expense of $619,000, and an increase in tax expense of $121,000.

Basic and diluted earnings per share for the three months ended March 31, 2021 were both $.34 per share compared to $.29 per share for both for the same period in 2020.

The increase in noninterest income for the three months ended March 31, 2021 is primarily due to increases in the gain on sale of loans, reflecting higher levels of residential mortgages originated for sale to the secondary markets compared to the same period in 2020. The increase in noninterest expense for the three months ended March 31, 2021 reflects higher levels of salaries and benefits, occupancy expense, and other expense. The higher levels of salaries and benefits and other expense for the three months ended March 31, 2021 are in part related to higher levels of residential mortgage originations and earnings in 2021. The increase in occupancy expense relates primarily to non-recurring costs for property maintenance projects.

For the three months ended March 31, 2021, the increase in the provision for loan losses reflects management’s consideration of the uncertainty of ongoing economic conditions resulting from the COVID-19 pandemic and associated economic slowdown.

Net Interest Margin

The net interest margin for the three months ended March 31, 2021 was 3.57% compared to 3.16% for the first quarter of 2020. The yield on average earning assets was 4.29% for the three months ended March 31, 2021 compared to 4.38% for the same period in 2020. The average cost of interest-bearing liabilities was 0.79% for the three months ended March 31, 2021 compared to 1.45% for the three months ended March 31, 2020.

Assets

Total assets increased $14.7 million or 2.3% to $659.3 million at March 31, 2021 compared to $644.6 million at December 31, 2020. Loans receivable decreased 0.3% to $482.2 million at March 31, 2021 compared to December 31, 2020. The available-for-sale investment portfolio decreased $521,000 from December 31, 2020 to March 31, 2021, and cash and cash equivalents increased by $19.1 million from December 31, 2020 to March 31, 2021. The $19.1 million increase in cash resulted primarily from a $3.4 million decrease in loans, including loans held for sale, and an increase of $15.9 million in deposits.

Nonperforming Loans

Our nonperforming loans to total loans ratio was 1.13% at March 31, 2021 and 1.07% at December 31, 2020. Net loan charge-offs to average loans for the three months ended March 31, 2021 was .03% and .05% for the three months ended March 31, 2020. The allowance for loan losses was 1.22% of total loans at March 31, 2021 and 1.19% at December 31, 2020.

Liabilities

Deposits totaled $562.9 million at March 31, 2021, an increase of $15.9 million or 2.9% from the December 31, 2020 total of $547.0 million. Borrowed funds decreased by $3.0 million from December 31, 2020 to $26.0 million at March 31, 2021.

Shareholders’ Equity

Shareholders’ equity increased $701,000 to $61.5 million at March 31, 2021 compared to December 31, 2020. The current level of shareholders’ equity equates to a book value per share of $17.34 at March 31, 2021, compared to $17.23 at December 31, 2020. Dividends paid to common shareholders were $0.15 for the three months ended March 31, 2021 and $0.23 for the same period in 2020.

Elmira Savings Bank, with $659.3 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with five offices in Chemung County, NY; three offices in Tompkins County, NY; two offices in Steuben County, NY; one office in Cayuga County, NY; one office in Schuyler County; and a loan center in Broome County, NY.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank’s regulatory reports.

ELMIRA SAVINGS BANK
CONSOLIDATED BALANCE SHEET
(unaudited)
(in thousands, except for share and per share data)				March 31,				December 31,
					2021				2020			% Change
ASSETS
Cash and due from banks				$	107,955			$	88,536			21.9	%
Federal funds sold and other short-term investments					359				651			-44.9	%
Total cash and cash equivalents					108,314				89,187			21.4	%
Securities available for sale, at fair value					5,604				6,125			-8.5	%
Securities held to maturity - fair value $6,798
at March 31, 2021, and $7,211 at December 31, 2020					6,537				6,597			-0.9	%
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost					8,596				9,054			-5.1	%
Loans held for sale					3,574				5,408			-33.9	%
Loans receivable					482,248				483,768			-0.3	%
Less: Allowance for loan losses					5,865				5,755			1.9	%
Net loans					476,383				478,013			-0.3	%
Premises and equipment, net					15,719				15,876			-1.0	%
Bank-owned life insurance					15,512				15,410			0.7	%
Accrued interest receivable					1,487				1,564			-4.9	%
Goodwill					12,320				12,320			0.0	%
Other assets					5,287				5,033			5.0	%
Total assets				$	659,333			$	644,587			2.3	%
LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits				$	562,893			$	547,021			2.9	%
Borrowings					26,000				29,000			-10.3	%
Other liabilities					8,978				7,805			15.0	%
Total liabilities					597,871				583,826			2.4	%
Shareholders’ equity:
Preferred stock, $1 par value; $1,000 liquidation value per issued share; 5,000,000 shares authorized;
10,000 shares issued and none outstanding at March 31, 2021 and at December 31, 2020					9,700				9,700			0.0	%
Common stock, $1 par value; authorized 5,000,000 shares; 3,636,137 shares issued and 3,542,254 outstanding
at March 31, 2021 and 3,616,770 shares issued and 3,522,887 outstanding at December 31, 2020					3,636				3,617			0.5	%
Additional paid-in capital					54,281				54,255			0.0	%
Retained earnings					5,869				5,197			12.9	%
Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares
at March 31, 2021 and December 31, 2020					(12,202	)			(12,202	)		0.0	%
Accumulated other comprehensive income					128				144			-11.1	%
Total Elmira Savings Bank shareholders’ equity					61,412				60,711			1.2	%
Noncontrolling interest					50				50			0.0	%
Total shareholders’ equity					61,462				60,761			1.2	%
Total liabilities and shareholders’ equity				$	659,333			$	644,587			2.3	%

ELMIRA SAVINGS BANK
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
		Three Months Ended
		March 31,
(in thousands, except for per share data)		2021			2020			% Change
Interest and dividend income:
Interest and fees on loans		$	5,212		$	5,622		-7.3	%
Interest and dividends on securities
Taxable			143			213		-32.9	%
Non-taxable			69			82		-15.9	%
Total interest and dividend income			5,424			5,917		-8.3	%
Interest expense:
Interest on deposits			725			1,417		-48.8	%
Interest on borrowings			178			219		-18.7	%
Total interest expense			903			1,636		-44.8	%
Net interest income			4,521			4,281		5.6	%
Provision for loan losses			150			50		200.0	%
Net interest income after provision for loan losses			4,371			4,231		3.3	%
Noninterest income:
Service fees			308			331		-6.9	%
Gain on sale of loans held for sale			1,211			435		178.4	%
Other service fees			210			188		11.7	%
Earnings on bank-owned life insurance			101			98		3.1	%
Other			95			87		9.2	%
Total noninterest income			1,925			1,139		69.0	%
Noninterest expense:
Salaries and benefits			2,307			2,144		7.6	%
Net occupancy			626			394		58.9	%
Equipment			442			400		10.5	%
Marketing and public relations			241			177		36.2	%
Professional fees			147			166		-11.4	%
Other			937			800		17.1	%
Total noninterest expense			4,700			4,081		15.2	%
Income before income taxes			1,596			1,289		23.8	%
Income taxes			392			271		44.6	%
Net income			1,204			1,018		18.3	%
Less: Net income attributable to noncontrolling interest			-			-		-
Net income attributable to Elmira Savings Bank		$	1,204		$	1,018		18.3	%
Basic earnings per share		$	0.34		$	0.29		17.2	%
Diluted earnings per share		$	0.34		$	0.29		17.2	%
Weighted average shares outstanding - basic			3,514,650			3,503,344		0.3	%
Weighted average shares outstanding - diluted			3,515,256			3,506,591		0.2	%
Dividends per share		$	0.15		$	0.23		-34.8	%

ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
(Dollars in Thousands)	For the Three Months Ended
	March 31, 2021									March 31, 2020
ASSETS:	Average Balance			Interest			Average Rate			Average Balance			Interest			Average Rate
Loans	$	485,646		$	5,212		4.31	%		$	511,479		$	5,622		4.39	%
Short-term investments		617			-		0.02				747			1		0.70
Securities		21,267			212		4.01				27,819			294		4.23
Total interest-earning assets		507,530			5,424		4.29				540,045			5,917		4.38
Noninterest-earning assets		140,728									59,734
TOTAL ASSETS	$	648,258								$	599,779
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing deposits	$	436,731		$	725		0.67			$	420,993		$	1,417		1.35
Borrowings		26,933			178		2.65				31,755			219		2.73
Total interest-bearing liabilities		463,664			903		0.79				452,748			1,636		1.45
Noninterest-bearing liabilities		123,014									87,899
Shareholders’ equity		61,580									59,132
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	648,258								$	599,779
Interest rate spread							3.50	%								2.93	%
Net interest income/margin				$	4,521		3.57	%					$	4,281		3.16	%

						Quarter Ended
(Dollars in Thousands, Except Per Share Data)				3/31/2021			12/31/2020			9/30/2020			6/30/2020			3/31/2020
Operating Data
	Net income		$	1,204		$	1,284		$	948		$	909		$	1,018
	Net interest income			4,521			4,310			3,852			4,137			4,281
	Provision for loan losses			150			375			450			575			50
	Non-interest income			1,925			2,504			1,928			1,648			1,139
	Non-interest expense			4,700			4,771			4,155			4,085			4,081
Performance Statistics
	Net interest margin			3.57	%		3.24	%		2.81	%		2.98	%		3.16	%
	Annualized return on average assets			0.75	%		0.78	%		0.55	%		0.57	%		0.68	%
	Annualized return on average equity			7.93	%		8.40	%		6.27	%		6.12	%		6.93	%
	Annualized net loan charge-offs to avg loans			0.03	%		0.03	%		0.04	%		0.09	%		0.05	%
	Net charge-offs			40			38			57			116			60
	Efficiency ratio			72.9	%		70.0	%		71.9	%		70.6	%		75.3	%
Per Share Data
	Basic earnings per share		$	0.34		$	0.37		$	0.27		$	0.26		$	0.29
	Diluted earnings per share			0.34			0.37			0.27			0.26			0.29
	Dividend declared per share			0.15			0.15			0.15			0.15			0.23
	Book value			17.34			17.23			17.01			16.87			16.77
	Common stock price:
		High		16.00			13.25			11.18			13.39			17.40
		Low		11.41			10.44			10.30			10.49			11.50
		Close		13.50			11.50			11.02			11.00			11.50
	Weighted average common shares:
		Basic		3,515			3,512			3,509			3,507			3,503
		Fully diluted		3,515			3,512			3,509			3,507			3,507
	End-of-period common shares:
		Issued		3,636			3,617			3,617			3,617			3,611
		Treasury		94			94			94			94			94
Financial Condition Data:
General
	Total assets		$	659,333		$	644,587		$	674,032		$	675,862		$	598,017
	Loans, net			476,383			478,013			504,946			518,698			506,076
	Intangibles			12,320			12,320			12,320			12,320			12,320
	Total deposits			562,893			547,021			551,350			551,225			501,760
		Noninterest-bearing		121,101			109,346			107,423			109,985			83,431
		Savings		87,228			82,573			79,492			79,150			72,174
		NOW		111,414			100,293			98,464			91,166			83,323
		Money Market		35,011			35,920			34,375			28,467			20,306
		Time deposits		208,139			218,889			231,596			242,457			242,526
		Total interest-bearing deposits		441,792			437,675			443,927			441,240			418,329
	Shareholders’ equity			61,462			60,761			59,960			59,496			59,044
Asset Quality
	Non-performing assets		$	5,602		$	5,304		$	5,507		$	5,578		$	4,686
	Non-performing assets to total assets			0.85	%		0.82	%		0.82	%		0.83	%		0.78	%
	Allowance for loan losses			5,865			5,755			5,418			5,025			4,566
	Allowance for loan losses to total loans			1.22	%		1.19	%		1.06	%		0.96	%		0.89	%
	Allowance for loan losses to
		non-performing loans		108.63	%		112.67	%		104.11	%		95.28	%		105.43	%
	Non-performing loans to total loans			1.13	%		1.07	%		1.03	%		1.02	%		0.86	%
Capitalization
	Shareholders’ equity to total assets			9.32	%		9.43	%		8.90	%		8.80	%		9.87	%

 

For further information contact:
Thomas M. Carr, President & CEO
Elmira Savings Bank
333 East Water Street
Elmira, New York 14901
(607) 735-8660
tcarr@elmirasavingsbank.com

 

 

FAQ

What were Elmira Savings Bank's earnings for Q1 2021?

Elmira Savings Bank reported a net income of $1,204,000 for Q1 2021.

How did diluted earnings per share change for ESBK in Q1 2021?

Diluted earnings per share increased to $0.34 in Q1 2021, up from $0.29 in Q1 2020.

What was the total asset value for Elmira Savings Bank as of March 31, 2021?

Total assets reached $659.3 million as of March 31, 2021.

What was the net interest margin for Elmira Savings Bank in Q1 2021?

The net interest margin was 3.57% for the three months ended March 31, 2021.

How did the provision for loan losses change in Q1 2021 for ESBK?

The provision for loan losses increased due to ongoing economic uncertainties from COVID-19.