Elmira Savings Bank Reports Second Quarter Earnings

Rhea-AI Summary

Elmira Savings Bank (NASDAQ:ESBK) reported net income of $909,000 and $1,927,000 for the three and six months ending June 30, 2020, showing year-over-year increases of 27% and 17%, respectively. Diluted EPS rose to $0.26 and $0.55 for the same periods, up from $0.21 and $0.47 in 2019. Total assets climbed 11.4% to $675.9 million, while deposits increased by 7.6% to $551.2 million. Nonperforming loans rose to 1.02%, and the allowance for loan losses was 0.96% of total loans. Dividends paid were $0.15 and $0.38 for the three and six months, respectively.

Positive

• Net income increased by 27% and 17% for the three and six months ending June 30, 2020.
• Diluted EPS rose to $0.26 and $0.55 for the three and six months, respectively.
• Total assets increased by 11.4% to $675.9 million.
• Deposits increased by 7.6% to $551.2 million.
• Shareholders' equity improved to $59.5 million, reflecting a book value per share of $16.87.

Negative

• Nonperforming loans ratio increased to 1.02% from 0.82% at the end of 2019.
• Provision for loan losses rose by $331,000 due to economic uncertainty.

ELMIRA, N.Y., July 22, 2020 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

• Net income was $909,000 and $1,927,000 for the three and six months ended June 30, 2020 compared to $718,000 and $1,645,000 for the same periods in 2019.

• Diluted earnings per share were $.26 per share and $.55 per share for the three and six months ended June 30, 2020 compared to $.21 per share and $.47 per share for the same periods in 2019. 

• Return on average assets was .57% and .62% for the three and six months ended June 30, 2020 compared to .47% and .56% for the three and six months ended June 30, 2019.

• Return on average equity was 6.12% and 6.52% for the three and six months ended June 30, 2020 compared to 4.92% and 5.66% for the same periods in 2019.

"We continue to be concerned about the impact the economic shutdown and subsequent staged reopening due to the COVID-19 pandemic is having on local economies. Our region has been fortunate to have not yet experienced the widespread health crisis like other areas of the state and country," said Thomas M Carr, President and CEO.  Carr continued, "We are focused on continuing to provide credit and 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 $1,927,000 for the six months ended June 30, 2020, an increase of $282,000 or 17% from the $1,645,000 of net income recorded for the same period in 2019.  This increase was the net result of an increase in noninterest income of $786,000 and an increase in net interest income of $221,000, offset by an increase in the provision for loan losses of $331,000, an increase in noninterest expense of $216,000, and an increase in tax expense of $178,000.

Net income totaled $909,000 for the three months ended June 30, 2020, an increase of $191,000 or 27% from the $718,000 recorded for the same period in 2019.  This increase was the net result of an increase in noninterest income of $630,000, an increase in net interest income of $40,000, and a decrease in noninterest expense of $13,000, offset by an increase in the provision for loan losses of $413,000 and an increase in tax expense of $79,000.

The increase in noninterest income for both the three and six months ended June 30, 2020 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 periods in 2019.

For both the three and six months ended June 30, 2020, the increases in the provision for loan losses reflect management’s consideration of the uncertainty of ongoing economic conditions resulting from the COVID-19 pandemic and associated economic slowdown. 

Basic and diluted earnings per share for the six months ended June 30, 2020 were both $.55 per share compared to $.47 per share for both for the same period in 2019.  Basic and diluted earnings per share for the three months ended June 30, 2020 were both $.26 per share compared to $.21 per share for both for the same period in 2019.

Net Interest Margin

The net interest margin for the six months ended June 30, 2020 was 3.07% compared to 3.10% for the same period in 2019.  The yield on average earning assets was 4.24% for the six months ended June 30, 2020 compared to 4.31% for the same period in 2019.  The average cost of interest-bearing liabilities was 1.38% for the six months ended June 30, 2020 compared to 1.42% for the same period in 2019.

The net interest margin for the three months ended June 30, 2020 was 2.98% compared to 3.06% for the same period in 2019.  The average yield on earning assets was 4.11% for the three months ended June 30, 2020 compared to 4.36% for the same period in 2019.  The average cost of interest-bearing liabilities was 1.32% for the three months ended June 30, 2020 compared to 1.50% for the same period in 2019.

Assets

Total assets increased $69.0 million or 11.4% to $675.9 million at June 30, 2020 compared to $606.8 million at December 31, 2019.  Loans, including loans held for sale, increased 1.4% to $527.6 million at June 30, 2020 compared to December 31, 2019.  The available-for-sale investment portfolio decreased $4.8 million from December 31, 2019 to June 30, 2020. Total cash and cash equivalents were $79.6 million at June 30, 2020, an increase of $67.5 million from December 31, 2019 when cash totaled $12.0 million.

Nonperforming Loans

Our nonperforming loans to total loans ratio was 1.02% at June 30, 2020 and 0.82% at December 31, 2019.  Net loan charge-offs to average loans for the six months ended June 30, 2020 was 0.09% for both the six months ended June 30, 2020 and June 30, 2019.  The allowance for loan losses was 0.96% of total loans at June 30, 2020 and 0.88% of total loans at December 31, 2019.

Liabilities

Deposits total $551.2 million at June 30, 2020, an increase of $39.0 million or 7.6% from the December 31, 2019 total of $512.2 million.  Borrowed funds totaled $56.9 million as of June 30, 2020, an increase of $27.9 million from December 31, 2019 when borrowed funds totaled $29.0 million.

Shareholders’ Equity

Shareholders’ equity increased $885,000 to $59.5 million at June 30, 2020 compared to December 31, 2019.  The current level of shareholders’ equity equates to a book value per share of $16.87 at June 30, 2020, compared to $16.67 at December 31, 2019.  Dividends paid for common shareholders were $0.15 and $0.38 for the three and six months ended June 30, 2020 and $0.23 and $0.46 for the three and six months ended June 30, 2019.  

Elmira Savings Bank, with $675.9 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.

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

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ELMIRA SAVINGS BANK
CONSOLIDATED BALANCE SHEET
(unaudited)
(in thousands, except for share and per share data)	June 30,		December 31,
		2020				2019			% Change
ASSETS
65%; width:65%; min-width:65%;">Cash and due from banks	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">79,470	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">11,954	1%; width:1%; min-width:1%;">	2%; width:2%; min-width:2%;">	9%; width:9%; min-width:9%;">564.8	1%; width:1%; min-width:1%;">%
Federal funds sold and other short-term investments		89				92			-3.3	%
Total cash and cash equivalents		79,559				12,046			560.5	%
Securities available for sale, at fair value		6,962				11,802			-41.0	%
Securities held to maturity - fair value $7,428 at June 30, 2020, and $7,233 at December 31, 2019		6,783				7,018			-3.3	%
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost		9,893				9,944			-0.5	%
Loans held for sale		3,919				1,354			189.4	%
Loans receivable		523,723				518,871			0.9	%
Less: Allowance for loan losses		5,025				4,576			9.8	%
Net loans		518,698				514,295			0.9	%
Premises and equipment, net		15,953				16,210			-1.6	%
Bank-owned life insurance		15,204				14,919			1.9	%
Accrued interest receivable		1,761				1,625			8.4	%
Goodwill		12,320				12,320			0.0	%
Other assets		4,810				5,296			-9.2	%
Total assets	$	675,862			$	606,829			11.4	%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits	$	551,225			$	512,215			7.6	%
Borrowings		56,896				29,000			96.2	%
Other liabilities		8,245				7,003			17.7	%
Total liabilities		616,366				548,218			12.4	%
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 June 30, 2020 and at December 31, 2019		9,700				9,700			0.0	%
Common stock, $1 par value; authorized 5,000,000 shares; 3,616,770 shares issued and 3,522,887 outstanding at June 30, 2020 and 3,606,089 shares issued and 3,512,206 outstanding at December 31, 2019		3,617				3,606			0.3	%
Additional paid-in capital		54,140				53,993			0.3	%
Retained earnings		4,022				3,432			17.2	%
Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares at June 30, 2020 and December 31, 2019		(12,202	)			(12,202	)		0.0	%
Accumulated other comprehensive income		169				32			428.1	%
Total Elmira Savings Bank shareholders' equity		59,446				58,561			1.5	%
Noncontrolling interest		50				50			0.0	%
Total shareholders' equity		59,496				58,611			1.5	%
Total liabilities and shareholders' equity	$	675,862			$	606,829			11.4	%

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ELMIRA SAVINGS BANK
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
		Three Months Ended		Six Months Ended
		June 30,		June 30,
(in thousands, except for per share data)		2020		2019		% Change		2020		2019		% Change
Interest and dividend income:
34%; width:34%; min-width:34%;">Interest and fees on loans	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">5,451	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">5,464	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">-0.2	1%; width:1%; min-width:1%;">%	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">11,073	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">10,647	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">4.0	1%; width:1%; min-width:1%;">%
Interest and dividends on securities
Taxable			177			252		-29.8	%			390			525		-25.7	%
Non-taxable			72			109		-33.9	%			154			224		-31.3	%
Total interest and dividend income			5,700			5,825		-2.1	%			11,617			11,396		1.9	%
Interest expense:
Interest on deposits			1,342			1,519		-11.7	%			2,759			2,780		-0.8	%
Interest on borrowings			221			209		5.7	%			440			419		5.0	%
Total interest expense			1,563			1,728		-9.5	%			3,199			3,199		0.0	%
Net interest income			4,137			4,097		1.0	%			8,418			8,197		2.7	%
Provision for loan losses			575			162		254.9	%			625			294		112.6	%
Net interest income after provision for loan losses			3,562			3,935		-9.5	%			7,793			7,903		-1.4	%
Noninterest income:
Service fees			255			345		-26.1	%			586			701		-16.4	%
Gain on sale of loans held for sale			1,192			425		180.5	%			1,629			714		128.2	%
Other service fees			181			212		-14.6	%			394			414		-4.8	%
Earnings on bank-owned life insurance			97			94		3.2	%			195			186		4.8	%
Other			31			50		-38.0	%			93			96		-3.1	%
Total noninterest income			1,756			1,126		56.0	%			2,897			2,111		37.2	%
Noninterest expense:
Salaries and benefits			2,070			2,105		-1.7	%			4,214			4,125		2.2	%
Net occupancy			435			375		16.0	%			829			820		1.1	%
Equipment			385			401		-4.0	%			785			764		2.7	%
Marketing and public relations			146			253		-42.3	%			323			499		-35.3	%
Professional fees			149			133		12.0	%			315			271		16.2	%
Other			1,008			939		7.3	%			1,810			1,581		14.5	%
Total noninterest expense			4,193			4,206		-0.3	%			8,276			8,060		2.7	%
Income before income taxes			1,125			855		31.6	%			2,414			1,954		23.5	%
Income taxes			216			137		57.7	%			487			309		57.6	%
Net income			909			718		26.6	%			1,927			1,645		17.1	%
Less: Net income attributable to noncontrolling interest			-			-		-				-			-		-
Net income attributable to Elmira Savings Bank			909			718		26.6	%			1,927			1,645		17.1	%
Dividend on preferred stock			-			-		-				-			-		-
Income available to common shareholders		$	909		$	718		26.6	%		$	1,927		$	1,645		17.1	%
Basic earnings per share		$	0.26		$	0.21		23.8	%		$	0.55		$	0.47		17.0	%
Diluted earnings per share		$	0.26		$	0.21		23.8	%		$	0.55		$	0.47		17.0	%
Weighted average shares outstanding - basic			3,507,136			3,493,298		0.4	%			3,505,240			3,492,571		0.4	%
Weighted average shares outstanding - diluted			3,507,136			3,499,335		0.2	%			3,506,864			3,500,198		0.2	%
Dividends per share		$	0.15		$	0.23		-34.8	%		$	0.38		$	0.46		-17.4	%

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ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
(Dollars in Thousands)	For the Three Months Ended
	June 30, 2020			June 30, 2019
ASSETS:	Average Balance	Interest		Average Rate		Average Balance	Interest		Average Rate
35%; width:35%; min-width:35%;">Loans	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">528,659	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">5,451	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">4.12	1%; width:1%; min-width:1%;">%	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">492,985	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">5,464	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">4.42	1%; width:1%; min-width:1%;">%
Short-term investments		1,328			-		0.02				513			3		2.11
Securities		24,909			249		4.01				39,985			358		3.59
Total interest-earning assets		554,896			5,700		4.11				533,483			5,825		4.36
Noninterest-earning assets		92,109								72,842
TOTAL ASSETS	$	647,005							$	606,325
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits	$	431,681		$	1,342		1.25			$	431,816		$	1,519		1.41
Borrowings		43,583			221		2.01				29,000			209		2.85
Total interest-bearing liabilities		475,264			1,563		1.32				460,816			1,728		1.50
Noninterest-bearing liabilities		111,950								86,960
Shareholders' equity		59,790								58,549
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	647,004							$	606,325
Interest rate spread					2.79	%						2.86	%
Net interest income/margin			$	4,137		2.98	%				$	4,097		3.06	%

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ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
(Dollars in Thousands)	For the Six Months Ended
	June 30, 2020			June 30, 2019
ASSETS:	Average Balance	Interest		Average Rate		Average Balance	Interest		Average Rate
35%; width:35%; min-width:35%;">Loans	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">520,069	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">11,073	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">4.25	1%; width:1%; min-width:1%;">%	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">487,500	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">$	9%; width:9%; min-width:9%;">10,647	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">4.37	1%; width:1%; min-width:1%;">%
Short-term investments		1,037			1		0.27				496			5		2.00
Securities		26,364			543		4.12				40,851			744		3.66
Total interest-earning assets		547,470			11,617		4.24				528,847			11,396		4.31
Noninterest-earning assets		75,922								67,108
TOTAL ASSETS	$	623,392							$	595,955
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits	$	426,337		$	2,759		1.30			$	423,792		$	2,780		1.32
Borrowings		37,669			440		2.31				29,376			419		2.83
Total interest-bearing liabilities		464,006			3,199		1.38				453,168			3,199		1.42
Noninterest-bearing liabilities		99,925								84,198
Shareholders' equity		59,461								58,589
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	623,392							$	595,955
Interest rate spread					2.86	%						2.89	%
Net interest income/margin			$	8,418		3.07	%				$	8,197		3.10	%

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	Quarter Ended
41%; width:41%; min-width:41%;">(Dollars in Thousands, Except Per Share Data)	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">6/30/2020	2%; width:2%; min-width:2%;">	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">3/31/2020	2%; width:2%; min-width:2%;">	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">12/31/2019	2%; width:2%; min-width:2%;">	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">9/30/2019	2%; width:2%; min-width:2%;">	1%; width:1%; min-width:1%;">	9%; width:9%; min-width:9%;">6/30/2019	1%; width:1%; min-width:1%;">
Operating Data
Net income	$	909		$	1,018		$	940		$	901		$	718
Net interest income		4,137			4,281			4,159			4,072			4,097
Provision for loan losses		575			50			200			250			162
Net security gains		-			-			-			90			-
Non-interest income, ex. Net security gains		1,756			1,141			1,358			1,214			1,126
Non-interest expense		4,193			4,083			4,174			4,043			4,206
Performance Statistics
Net interest margin		2.98	%		3.16	%		3.01	%		2.97	%		3.06	%
Annualized return on average assets		0.57	%		0.68	%		0.61	%		0.58	%		0.47	%
Annualized return on average equity		6.12	%		6.93	%		6.33	%		6.07	%		4.92	%
Annualized net loan charge-offs to avg loans		0.09	%		0.05	%		0.14	%		0.11	%		0.09	%
Net charge-offs		116			60			183			135			105
Efficiency ratio		71.1	%		75.3	%		75.7	%		75.2	%		80.5	%
Per Share Data
Basic earnings per share	$	0.26		$	0.29		$	0.27		$	0.26		$	0.21
Diluted earnings per share		0.26			0.29			0.27			0.26			0.21
Dividend declared per share		0.15			0.23			0.23			0.23			0.23
Book value		16.87			16.77			16.67			16.62			16.60
Common stock price:
High		13.39			17.40			15.99			16.40			17.40
Low		10.49			11.50			13.97			13.97			15.69
Close		11.00			11.50			15.10			14.07			16.05
Weighted average common shares:
Basic		3,507			3,503			3,499			3,496			3,493
Fully diluted		3,507			3,507			3,501			3,499			3,499
End-of-period common shares:
Issued		3,617			3,611			3,606			3,606			3,605
Treasury		94			94			94			94			94
Financial Condition Data:
General
Total assets	$	675,862		$	598,017		$	606,829		$	615,601		$	610,398
Loans, net		518,698			506,076			514,295			511,750			496,149
Intangibles		12,320			12,320			12,320			12,320			12,320
Total deposits		551,225			501,760			512,215			520,030			516,327
Noninterest-bearing		109,985			83,431			81,934			82,613			81,249
Savings		79,150			72,174			70,358			69,186			71,100
NOW		91,166			83,323			88,126			84,207			85,130
Money Market		28,467			20,306			24,724			21,555			19,925
Time deposits		242,457			242,526			247,073			262,469			258,923
Total interest-bearing deposits		441,240			418,329			430,281			437,417			435,078
Shareholders' equity		59,496			59,044			58,611			58,422			58,357
Asset Quality
Non-performing assets	$	5,578		$	4,686		$	4,723		$	4,923		$	4,996
Non-performing assets to total assets		0.83	%		0.78	%		0.78	%		0.80	%		0.82	%
Allowance for loan losses		5,025			4,566			4,576			4,559			4,444
Allowance for loan losses to total loans		0.96	%		0.89	%		0.88	%		0.88	%		0.89	%
Allowance for loan losses to non-performing loans		95.28	%		105.43	%		108.51	%		96.43	%		93.55	%
Non-performing loans to total loans		1.02	%		0.86	%		0.82	%		0.92	%		0.96	%
Capitalization
Shareholders' equity to total assets		8.80	%		9.87	%		9.66	%		9.49	%		9.56	%

FAQ

What were Elmira Savings Bank's earnings for the second quarter of 2020?

Elmira Savings Bank reported net income of $909,000 for the three months ended June 30, 2020.

How did Elmira Savings Bank's diluted EPS change in 2020?

Diluted EPS increased to $0.26 for Q2 2020, up from $0.21 in Q2 2019.

What is the total asset value of Elmira Savings Bank as of June 30, 2020?

Total assets were reported at $675.9 million.

How much did Elmira Savings Bank's dividends pay for the first half of 2020?

Dividends paid were $0.15 and $0.38 for the three and six months ending June 30, 2020.

What was the increase in nonperforming loans for Elmira Savings Bank?

The nonperforming loans to total loans ratio increased to 1.02% at June 30, 2020.