First National Bank Alaska Announces Unaudited Results for First Quarter 2022

Rhea-AI Summary

First National Bank Alaska (OTCQX:FBAK) reported a net income of $13.8 million or $4.37 per share for Q1 2022, slightly down from $14.0 million or $4.41 per share in Q1 2021. Assets decreased by $188.1 million to $5.4 billion, influenced by seasonal deposit outflows. Total deposits rose to $4.9 billion, up from $4.3 billion year-over-year. The return on assets was 1.01%, down from 1.18% in the previous year. Noninterest income fell 9.3% while expenses decreased 1.4%. Shareholders' equity dropped to $474 million, reflecting a decrease in market value of securities amid rising interest rates.

Positive

• Total deposits increased to $4.9 billion, up from $4.3 billion year-over-year.
• Return on equity improved to 10.76%, compared to 9.66% in the same period last year.
• Tier 1 leverage capital ratio remains strong at 10.05%, above well-capitalized standards.

Negative

• Net income decreased from $14.0 million to $13.8 million year-over-year.
• Return on assets declined to 1.01% from 1.18% in Q1 2021.
• Noninterest income decreased by 9.3% compared to the first quarter 2021.
• Total loans decreased by $164 million year-over-year.

ANCHORAGE, Alaska--(BUSINESS WIRE)-- First National Bank Alaska’s (OTCQX:FBAK) unaudited net income for the first quarter of 2022 was $13.8 million, or $4.37 per share. This compares to a net income of $14.0 million, or $4.41 per share, for the same period in 2021.

Assets totaled $5.4 billion as of March 31, 2022, decreasing $188.1 million during the first quarter as the seasonality of deposit outflow returned to a more typical pattern over the prior two growth years influenced by the pandemic. Total deposits and repurchase agreements totaled $4.9 billion as of March 31, 2022, compared to $4.3 billion one year earlier.

The bank invested excess cash into securities in the first quarter for yield improvement while the existing available-for-sale securities market value decreased on the market shift to higher interest rates. Return on assets for the three months ending March 31, 2022, was 1.01%, decreased from 1.18% for the same period last year. At that time, total assets were lower by $465 million at $4.9 billion.

“First National Bank Alaska has grown in asset size by more than 40% during the pandemic,” said Betsy Lawer, Board Chair and CEO/President. “Anticipated interest rate changes in 2022 will fuel an already dynamic banking environment. Our 100^th anniversary year is off to a good start. Along with our customers, we are poised to take advantage of improving economic conditions in Alaska in 2022, working together with Alaskans to shape a brighter future for us all.”

Interest and fees on loans decreased $4.0 million from the prior year, a result of reduced interest and fees on SBA PPP loans. Interest and dividends on investment securities increased $2.0 million year-over-year on increased volume and yield improvements.

The blended yield on interest-earning assets decreased to 2.64% from 3.23% for the three-month period ending March 31, 2022 and 2021, respectively. Lower yields on earning assets resulted from variable loan repricing, the outstanding SBA PPP loans, and significant cash and short-term investments. The year-to-date net interest margin moved to 2.60% compared to 3.19% in March 2021 on declining yields on earning assets.

Noninterest income for the first quarter 2022 decreased 9.3% from the first quarter 2021. Bankcard fees increased 15.7% year-over-year offset by a decrease in mortgage loan origination income as home purchases and refinancing activity slowed. Noninterest expenses for the first quarter 2022 decreased 1.4% when compared to the first quarter 2021. Salaries and employee benefits decreased year-over-year with total employee headcount lower by 7% from the same time last year; the difficult labor market continues to pose employee recruitment challenges.

Total loans decreased $164.0 million year-over-year. Outstanding SBA PPP loans totaled $70.7 million and $342.2 million as of March 31, 2022 and 2021, respectively, a decrease of $271.4 million. Through the first quarter of 2022, First National’s SBA PPP borrowers received forgiveness totaling $510.4 million over the life of the program.

At March 31, 2022 delinquent loans from 30 to 89 days were $0.6 million, 0.03% of outstanding loans excluding SBA PPP loans, an increase of $0.4 million from December 31, 2021. Nonperforming loans were $16.5 million, 0.81% of outstanding loans excluding SBA PPP loans, a decrease of $1.0 million from December 31, 2021. The allowance for loan losses at March 31, 2022 was $22.6 million, 1.07% of total loans (1.11% of loans excluding SBA PPP).

Remaining pandemic loan modifications as of March 31, 2022 totaled $40.2 million, or 2.0% of total loans, excluding SBA PPP loans. Modifications allowed interest-only payments for periods ranging from two to six months. Modifications were concentrated in commercial real estate loans to customers in the rental and leasing industries, hotels, and art, entertainment and recreation industries.

Shareholders’ equity was $474.0 million as of March 31, 2022, compared to $554.5 million as of December 31, 2021, a decrease of $80.5 million resulting from a decrease in market value of securities available-for-sale in a period of rising interest rates. The bank generally holds securities to maturity in which case unrealized losses are temporary. Return on equity as of March 31, 2022 increased to 10.76% compared to 9.66% for the same period last year. Book value per share as of March 31, 2022 was $149.68, compared to $175.10 as of December 31, 2021. The bank’s March 31, 2022 Tier 1 leverage capital ratio of 10.05% remains above well-capitalized standards.

First National Bank Alaska files a quarterly financial report with the Federal Financial Institution Examination Council. Our latest Consolidated Report of Condition and Income (Call Report) is filed by the 30th of the month following quarter-end and is subsequently posted at www.FNBAlaska.com > Financial Reports and at www.OTCMarkets.com.

Alaskan-owned and -operated since 1922, First National proudly marks its 100th year of meeting the financial needs of Alaskans. In 2021, Alaska Business readers voted the bank the “Best of Alaska Business” in the Best Place to Work category for the sixth year in a row, Best Corporate Citizen for a third year, and Best Bank/Credit Union. The same year, American Banker recognized First National as a “Best Bank to Work For” for the fourth year in a row, and Anchorage Daily News readers voted the bank one of the state’s top three financial institutions for the third year in a row in the ADN “Best of Alaska” Awards.

Visit FNBAlaska.com for more information about Alaska’s largest locally owned bank and access to efficient and secure online banking services. First National Bank Alaska is a Member FDIC and Equal Housing Lender.

Financial Overview (Unaudited)		Quarter Ended ($ in thousands)
		3/31/2022			12/31/2021			9/30/2021			6/30/2021			3/31/2021
Balance Sheet
Total Assets		$	5,393,217		$	5,581,340		$	5,521,126		$	5,338,052		$	4,927,784
Total Securities		$	2,878,295		$	2,842,950		$	2,670,064		$	2,229,470		$	2,089,373
Total Loans		$	2,107,885		$	2,127,271		$	2,245,532		$	2,268,263		$	2,271,850
Total Deposits		$	4,135,870		$	4,216,924		$	4,102,624		$	3,910,717		$	3,486,685
Repurchase Agreements		$	758,052		$	781,700		$	826,611		$	830,245		$	850,409
Total Deposits and Repurchase Agreements		$	4,893,922		$	4,998,624		$	4,929,235		$	4,740,962		$	4,337,094
Total Shareholders' Equity		$	474,019		$	554,530		$	565,069		$	577,266		$	571,083
Income Statement
Net Interest and Loan Fee Income		$	34,700		$	38,758		$	34,669		$	35,466		$	36,708
Provision for Loan losses		$	(316	)	$	(660	)	$	357		$	1,033		$	1,697
Total Noninterest Income		$	5,620		$	6,183		$	6,322		$	6,787		$	6,198
Total Noninterest Expense		$	22,262		$	23,811		$	21,432		$	22,974		$	22,569
Provision for Income Taxes		$	4,538		$	5,447		$	4,807		$	4,547		$	4,663
Net Income		$	13,836		$	16,343		$	14,395		$	13,699		$	13,977
Earnings per common share		$	4.37		$	5.16		$	4.55		$	4.33		$	4.41
Dividend per common share		$	3.20		$	3.20		$	6.40		$	3.20		$	3.20
Financial Measures
Return on Assets			1.01	%		1.12	%		1.11	%		1.13	%		1.18	%
Return on Equity			10.76	%		10.23	%		9.76	%		9.57	%		9.66	%
Net Interest Margin			2.60	%		2.88	%		2.89	%		3.03	%		3.19	%
Yield on Loans			4.91	%		5.12	%		4.99	%		5.10	%		5.31	%
Yield on Securities			1.27	%		1.40	%		1.45	%		1.51	%		1.56	%
Cost of Interest Bearing Deposits			0.07	%		0.05	%		0.05	%		0.04	%		0.05	%
Efficiency Ratio			54.78	%		53.06	%		53.23	%		53.25	%		52.18	%
Capital
Shareholders' Equity/Total Assets			8.79	%		9.94	%		10.23	%		10.81	%		11.59	%
Tier 1 Leverage Ratio			10.05	%		9.81	%		9.97	%		10.81	%		11.45	%
Regulatory Well Capitalized Minimum Ratio - Tier 1 Leverage Ratio			5.00	%		5.00	%		5.00	%		5.00	%		5.00	%
Tier 1 (Core) Capital		$	549,966		$	546,264		$	540,055		$	545,928		$	542,363
Credit Quality
Noncurrent Loans and OREO		$	16,585		$	18,217		$	17,611		$	11,446		$	14,314
Noncurrent Loans and OREO/Total Assets			0.31	%		0.33	%		0.32	%		0.21	%		0.29	%
Noncurrent Loans and OREO/Tier 1 Capital			3.02	%		3.33	%		3.26	%		2.10	%		2.64	%
Allowance for Loan Losses		$	22,600		$	22,900		$	23,500		$	23,500		$	23,550
Allowance for Loan Losses/Total Loans			1.07	%		1.08	%		1.05	%		1.04	%		1.04	%
Net interest margin, yields, and efficiency ratios are tax effected.
Financial measures are year-to-date.
Per common share amounts are not in thousands.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220504006091/en/

Cheri Gillian, (907) 777-3409

http://www.FNBAlaska.com

Source: First National Bank Alaska

FAQ

What was First National Bank Alaska's net income for the first quarter of 2022?

First National Bank Alaska reported a net income of $13.8 million for Q1 2022.

How did the total assets of First National Bank Alaska change in Q1 2022?

Total assets decreased by $188.1 million to $5.4 billion as of March 31, 2022.

What are the key financial metrics reported by FBAK for Q1 2022?

In Q1 2022, FBAK reported a return on equity of 10.76% and a return on assets of 1.01%.

Did First National Bank Alaska increase or decrease its total deposits in Q1 2022?

Total deposits increased to $4.9 billion in Q1 2022, up from $4.3 billion a year earlier.

How much did First National Bank Alaska's net income per share change from Q1 2021 to Q1 2022?

Net income per share decreased from $4.41 in Q1 2021 to $4.37 in Q1 2022.