First Reliance Bancshares Reports Third Quarter 2021 Results

Rhea-AI Summary

First Reliance Bancshares (OTC:FSRL) reported a net income of $1.3 million ($0.16 per diluted share) for Q3 2021, down from $4.5 million ($0.56) in Q3 2020. Total assets rose 37.9% annualized to $911.1 million, driven by a $38.4 million increase in loans and a $76.0 million increase in deposits. Net interest income was $6.3 million, down 7.5% year-over-year. Asset quality remains strong with nonperforming assets at 0.15%. The company redeemed $5 million in subordinated notes and issued $10 million in new notes.

Positive

• Total assets increased by $78.8 million (37.9% annualized).
• Loans increased by $38.4 million (29.2% annualized).
• Deposits increased by $76 million (42.7% annualized).
• Net recoveries of $511,000 in Q3 2021 compared to $6,000 in Q3 2020.

Negative

• Net income decreased to $1.3 million from $4.5 million year-over-year.
• Net interest income fell by $0.5 million (7.5%) compared to Q3 2020.
• Total revenue decreased to $9.57 million from $14.82 million in Q3 2020.

FLORENCE, S.C., Oct. 21, 2021 /PRNewswire/ -- First Reliance Bancshares, Inc. (OTC:FSRL), the holding company for First Reliance Bank (collectively, "First Reliance" or the "Company"), today announced its financial results for the third quarter of 2021.

Third Quarter 2021 Highlights

• Net income for the third quarter of 2021 was $1.3 million, or $0.16 per diluted share, compared to $4.5 million, or $0.56 per diluted share, for the third quarter of 2020.
• Total assets increased $78.8 million, or 37.9% annualized, to $911.1 million at September 30, 2021 from $832.2 million at June 30, 2021.
• Total loans increased $38.4 million, or 29.2% annualized, to $564.7 million at September 30, 2021 from $526.4 million at June 30, 2021.
• Total deposits increased $76.0 million, or 42.7% annualized, to $787.5 million at September 30, 2021 from $711.5 million at June 30, 2021. This growth was primarily driven by noninterest-bearing deposits and money market deposits, which increased $30.7 million and $46.5 million, respectively.
• Net interest income for the quarter was $6.3 million, which represents an increase of $44 thousand, or 0.7%, on a linked quarter basis and a decrease of $0.5 million, or 7.5%, compared to the same period in 2020.
• Included within net interest income for the three months ended June 30, 2021 and the three months ended September 30, 2020 was $0.3 million and $0.9 million, respectively, of PPP interest and accelerated fee income. The Company sold the PPP portfolios in full during those periods.
• Asset quality remained strong, with nonperforming assets as a percentage of total assets decreasing to 0.15% at September 30, 2021 from 0.17% at June 30, 2021.
• The Company had net recoveries of $511 thousand, or annualized (0.37%) of average loans during the quarter compared to net recoveries of $6 thousand, or annualized (0.00%) of average loans, for the same period in 2020.
• Cost of funds for the third quarter of 2021 decreased to 0.24% from 0.29% on a linked quarter basis and from 0.52% for the same period in 2020.
• On August 5, 2021, the Company redeemed all $5.0 million of its 7.00% fixed-to-floating rate subordinated notes. On September 22, 2021, the Company issued $10.0 million of 3.375% fixed-to-floating rate subordinated notes with a 10-year maturity and a call option after 5 years.

Rick Saunders, Chief Executive Officer, remarked on the quarter: "Our third quarter results are representative of our continued focus on organic growth and improving operating scale.  The operating environment for the banking industry remains challenging with normalizing mortgage revenues and continued low interest rates.  However, despite these challenges, we are continuing to execute the early phase of our growth strategy.  We had another quarter of extraordinary deposit growth and continued to grow our loan portfolio within our conservative underwriting framework.  Annualized deposit growth of 42.7% and annualized loan growth of 29.2% during the quarter is reflective of our team's ability to move their relationships to First Reliance.  I'm especially proud that we continue to maintain our deposit mix, with over 48% of total deposits being comprised of checking balances."  

Mr. Saunders continued, "As our loan growth continues, we expect our balance sheet mix to normalize over time, especially as it relates to cash.  While our large cash position continues to create downward pressure on net interest margin, revenue, and efficiency, the short-term duration of this asset has protected book value and provides future earnings potential.  As the rate environment becomes more favorable, the Company will have more opportunities to deploy this cash strategically."

Mr. Saunders concluded, "I would like to thank all of our associates for their continued hard work and their commitment to our customers, our communities, and our shareholders."

Financial Summary

	Three Months Ended						Nine Months Ended
	Sept 30	June 30	Mar 31	Dec 31	Sept 30		Sept 30	Sept 30
($ in thousands, except per share data)	2021	2021	2021	2020	2020		2021	2020
Earnings:
Net income available to common shareholders	$  1,288	$  1,348	$  1,708	$  1,389	$  4,468		$  4,344	$  9,227
Earnings per common share, diluted	0.16	0.17	0.21	0.17	0.56		0.53	1.15
Total revenue(1)	9,570	10,169	9,917	10,858	14,820		29,655	35,603
Net interest margin	3.12%	3.40%	3.36%	3.27%	3.83%		3.30%	3.84%
Return on average assets(2)	0.60%	0.67%	0.93%	0.72%	2.31%		0.72%	1.72%
Return on average equity(2)	7.29%	7.83%	9.91%	8.08%	27.73%		8.34%	20.24%
Efficiency ratio(3)	83.83%	81.82%	77.35%	80.05%	54.28%		80.98%	60.11%

Footnotes to table located at the end of this release.

	As of
	Sept 30	June 30	Mar 31	Dec 31	Sept 30
(dollars in thousands)	2021	2021	2021	2020	2020
Balance Sheet:
Total assets	$  911,057	$  832,241	$  777,735	$  710,168	$  781,655
Total loans receivable	564,738	526,362	490,326	477,968	478,745
Total deposits	787,501	711,505	661,217	594,000	595,767
Total transaction deposits(4)to total deposits	48.25%	48.92%	49.78%	48.51%	47.30%
Loans to deposits	71.71%	73.98%	74.16%	80.47%	80.36%
Bank Capital Ratios:
Total risk-based capital ratio	15.80%	14.89%	16.00%	15.67%	14.75%
Tier 1 risk-based capital ratio	14.64%	13.84%	14.87%	14.52%	13.72%
Tier 1 leverage ratio	10.24%	10.43%	11.13%	10.31%	9.96%
Common equity tier 1 capital ratio	14.64%	13.84%	14.87%	14.52%	13.72%
Asset Quality Ratios:
Nonperforming assets as a percentage of    total assets	0.15%	0.17%	0.17%	0.21%	0.19%
Allowance for loan losses as a percentage of    total loans receivable	1.23%	1.20%	1.26%	1.29%	1.20%

Footnotes to table located at the end of this release.

CONDENSED CONSOLIDATED INCOME STATEMENTS – Unaudited

	Three Months Ended						Nine Months Ended
	Sept 30	June 30	Mar 31	Dec 31	Sept 30		Sept 30
($ in thousands, except per share data)	2021	2021	2021	2020	2020		2021	2020
Interest income
Loans	$  6,382	$  6,391	$  5,851	$  6,156	$  7,403		$  18,623	$  20,621
Investment securities	294	311	238	231	218		844	840
Other interest income	58	38	60	75	67		155	198
Total interest income	6,734	6,740	6,149	6,462	7,688		19,622	21,659
Interest expense
Deposits	257	255	286	376	519		798	1,999
Other interest expense	213	265	262	388	400		740	1,107
Total interest expense	470	520	548	764	919		1,538	3,106
Net interest income	6,264	6,220	5,601	5,698	6,769		18,084	18,553
Provision for loan losses	100	108	-	350	1,000		208	2,550
Net interest income after provision for loan    losses	6,164	6,112	5,601	5,348	5,769		17,876	16,003
Noninterest income
Mortgage banking income	2,151	2,582	3,390	5,014	7,115		8,124	14,510
Service fees on deposit accounts	315	272	279	315	290		865	995
Debit card and other service charges,    commissions, and fees	532	509	454	427	426		1,495	1,170
Income from bank owned life insurance	94	94	93	101	103		281	308
Gain (loss) on sale of securities, net	48	39	-	8	-		87	(220)
Gain on sale of loans	-	326	-	-	-		326	-
Loss on extinguishment of debt	-	-	-	(287)	-		-	-
Loss on disposal of fixed assets	-	-	-	(528)	-		-	-
Other income	166	127	100	110	117		393	287
Total noninterest income	3,306	3,949	4,316	5,160	8,051		11,571	17,050
Noninterest expense
Compensation and benefits	5,268	5,518	4,992	5,359	4,892		15,777	12,870
Occupancy	616	584	597	641	628		1,796	1,859
Furniture and equipment	323	403	450	616	572		1,176	1,694
Electronic data processing	337	319	277	241	231		933	625
Professional fees	234	242	238	400	230		715	826
Marketing	113	88	69	155	122		270	255
Other	1,132	1,166	1,048	1,280	1,288		3,347	2,845
Total noninterest expense	8,023	8,320	7,671	8,692	7,963		24,014	20,974
Income before provision for income taxes	1,447	1,741	2,246	1,816	5,857		5,433	12,079
Income tax expense	159	393	538	427	1,389		1,089	2,852
Net income available to common shareholders	$  1,288	$  1,348	$  1,708	$  1,389	$  4,468		$     4,344	$     9,227
Weighted average common shares - basic	7,750	7,681	7,780	7,931	7,929		7,737	7,915
Weighted average common shares - diluted	8,084	8,164	8,168	8,089	8,015		8,160	8,012
Basic income per common share	$     0.17	$     0.18	$     0.22	$     0.18	$     0.56		$        0.56	$        1.17
Diluted income per common share	$     0.16	$     0.17	$     0.21	$     0.17	$     0.56		$        0.53	$        1.15

Net income for the three months ended September 30, 2021 was $1.3 million, or $0.16 per diluted common share, compared to $4.5 million, or $0.56 per diluted common share, for the three months ended September 30, 2020.  Net income for the nine months ended September 30, 2021 totaled $4.3 million, or $0.53 per diluted common share, compared to $9.2 million, or $1.15 per diluted common share for the nine months ended September 30, 2020.

Noninterest income for the three months ended September 30, 2021 was $3.3 million, a decrease of $4.8 million from $8.1 million for the same period in 2020.  Noninterest income is largely driven by the Company's mortgage banking division, which produced net revenue of $2.2 million on $124 million of mortgage sale volume during the three months ended September 30, 2021.  The primary driver of the decrease in mortgage banking income period-over-period was a decrease in margin on loan sales.  Additionally, growth in the retail channel drove the increased utilization of bank portfolio products.  This negatively affected gain on sale during the quarter by approximately $0.4 million. 

Noninterest expense for the three months ended September 30, 2021 was consistent with the same period in 2020 at $8.0 million.  Increases in compensation and benefits expense of $0.4 million and electronic data processing expense of $0.1 million were offset by decreases in furniture and equipment expense of $0.2 million and other expenses of $0.2 million.  Included in compensation and benefits for the current quarter is approximately $24 thousand in severance expense.  The additional increase in compensation and benefits is driven mainly by increased headcount year-over-year.

NET INTEREST INCOME AND MARGIN – Unaudited

	For the Three Months Ended
	September 30, 2021				September 30, 2020
	Average	Income/	Yield/		Average	Income/	Yield/
(dollars in thousands)	Balance	Expense	Rate		Balance	Expense	Rate
Assets
Interest-earning assets
Federal funds sold and interest-bearing deposits	$  159,307	$         51	0.13%		$  110,453	$         23	0.08%
Investment securities	55,049	294	2.12%		36,389	218	2.38%
Nonmarketable equity securities	837	7	3.38%		4,039	44	4.32%
Loans held for sale	32,181	244	3.01%		52,919	442	3.31%
Loans	548,028	6,138	4.44%		497,919	6,961	5.55%
Total interest-earning assets	795,402	6,734	3.36%		701,719	7,688	4.35%
Allowance for loan losses	(6,764)				(5,027)
Noninterest-earning assets	75,650				76,978
Total assets	$  864,288				$  773,670
Liabilities and Shareholders' Equity
Interest-bearing liabilities
NOW accounts	$  133,577	$         16	0.05%		$  107,936	$         13	0.05%
Savings & money market	246,212	101	0.16%		144,333	80	0.22%
Time deposits	132,972	140	0.42%		161,090	426	1.05%
Total interest-bearing deposits	512,761	257	0.20%		413,359	519	0.50%
FHLB advances and other borrowings	19,839	48	0.96%		85,383	176	0.82%
Subordinated debentures	18,144	165	3.61%		20,810	224	4.27%
Total interest-bearing liabilities	550,744	470	0.34%		519,552	919	0.70%
Noninterest bearing deposits	231,993				179,196
Other liabilities	10,903				10,474
Shareholders' equity	70,648				64,448
Total liabilities and shareholders' equity	$  864,288				$  773,670
Net interest income / interest rate spread		$  6,264	3.02%			$  6,769	3.65%
Net interest margin			3.12%				3.83%
	For the Nine Months Ended
	September 30, 2021				September 30, 2020
	Average	Income/	Yield/		Average	Income/	Yield/
(dollars in thousands)	Balance	Expense	Rate		Balance	Expense	Rate
Assets
Interest-earning assets
Federal funds sold and interest-bearing deposits	$  128,926	$         109	0.11%		$     59,668	$            93	0.21%
Investment securities	50,139	844	2.25%		40,926	840	2.74%
Nonmarketable equity securities	909	46	6.75%		3,476	105	4.06%
Loans held for sale	34,653	740	2.85%		45,727	1,117	3.25%
Loans	517,512	17,883	4.62%		493,571	19,504	5.26%
Total interest-earning assets	732,139	19,622	3.58%		643,368	21,659	4.48%
Allowance for loan losses	(6,478)				(4,235)
Noninterest-earning assets	74,404				76,679
Total assets	$  800,065				$  715,812
Liabilities and Shareholders' Equity
Interest-bearing liabilities
NOW accounts	$  129,834	$            45	0.05%		$  102,370	$            35	0.04%
Savings & money market	210,738	263	0.17%		130,707	302	0.31%
Time deposits	136,221	490	0.48%		153,769	1,662	1.44%
Total interest-bearing deposits	476,793	798	0.22%		386,846	1,999	0.69%
FHLB advances and other borrowings	17,665	141	1.06%		74,653	517	0.93%
Subordinated debentures	19,901	599	4.03%		17,698	590	4.46%
Total interest-bearing liabilities	514,359	1,538	0.40%		479,197	3,106	0.86%
Noninterest bearing deposits	205,531				165,458
Other liabilities	10,695				10,378
Shareholders' equity	69,480				60,779
Total liabilities and shareholders' equity	$  800,065				$  715,812
Net interest income / interest rate spread		$  18,084	3.18%			$  18,553	3.62%
Net interest margin			3.30%				3.84%

Net interest income for the three months ended September 30, 2021 was $6.3 million compared to $6.8 million for the three months ended September 30, 2020.  Included within the three months ended September 30, 2020 was approximately $0.9 million of interest and accelerated fee income on PPP loans, which were sold in August 2020.  Adjusting for this PPP income, net interest income increased by $0.4 million, or 7.5%, for the three months ended September 30, 2021 compared to the same period in 2020.  This increase was primarily driven by an increase in interest-earning assets as well as a decrease in the cost of interest-bearing liabilities, which decreased from 0.70% to 0.34%. Improvements in costs of interest-bearing liabilities continue to be offset to some extent by downward pressure on asset yield.  Yield on interest-earning assets decreased to 3.36% for the three months ended September 30, 2021 from 3.93% (excluding PPP interest and fee income) for the same period in 2020.  This decrease was driven by both a change in balance sheet mix and an overall decrease in interest rates stemming from decreases in the federal funds target rate during 2020. 

Net interest income for the nine months ended September 30, 2021 was $18.1 million compared to $18.6 million for the nine months ended September 30, 2020.  As mentioned previously, the prior period amounts were positively affected by $0.9 million of interest and fee income on PPP loans.  If interest and fee income on PPP loans are removed from both nine-month periods, net interest income increased by $0.2 million, or 1.1%, period over period. 

CONDENSED CONSOLIDATED BALANCE SHEETS – Unaudited

	As of
	Sept 30	June 30	Mar 31	Dec 31	Sept 30
(dollars in thousands)	2021	2021	2021	2020	2020
Assets
Cash and cash equivalents:
Cash and due from banks	$        4,930	$        5,486	$        5,547	$        5,521	$        5,133
Interest-bearing deposits with banks	184,739	144,937	115,577	93,167	134,592
Total cash and cash equivalents	189,669	150,423	121,124	98,688	139,725
Time deposits in other banks	257	256	256	256	256
Investment securities:
Investment securities available for sale	58,470	56,881	54,413	32,759	35,567
Other investments	837	837	837	1,076	3,839
Total investment securities	59,307	57,718	55,250	33,835	39,406
Mortgage loans held for sale	33,667	33,097	48,912	35,642	57,853
Loans receivable:
Loans	564,738	526,362	490,326	477,968	478,745
Less allowance for loan losses	(6,934)	(6,323)	(6,168)	(6,173)	(5,721)
Loans receivable, net	557,804	520,039	484,158	471,795	473,024
Property and equipment, net	22,364	21,818	18,465	18,491	20,548
Mortgage servicing rights	13,785	13,603	13,353	12,021	11,000
Bank owned life insurance	18,383	18,289	18,195	18,102	18,001
Deferred income taxes	2,798	2,820	3,234	3,452	3,872
Other assets	13,023	14,178	14,788	17,886	17,970
Total assets	911,057	832,241	777,735	710,168	781,655
Liabilities
Deposits	$  787,501	$  711,505	$  661,217	$  594,000	$  595,767
Federal Home Loan Bank advances	10,000	10,000	10,000	10,000	75,000
Federal funds and repurchase agreements	6,353	8,946	6,955	5,523	12,591
Subordinated debentures	15,498	10,496	10,487	10,459	10,427
Junior subordinated debentures	10,310	10,310	10,310	10,310	10,310
Other liabilities	10,983	11,393	10,548	11,147	10,178
Total liabilities	840,645	762,650	709,517	641,439	714,273
Shareholders' equity
Preferred stock - Series D non-cumulative, no par   value	1	1	1	1	1
Common Stock - $.01 par value; 20,000,000 shares   authorized	88	88	88	82	81
Non-Voting Common Stock, $.01 par value;   430,000 shares authorized	-	-	-	4	4
Treasury stock, at cost	(4,281)	(3,858)	(3,744)	(1,680)	(1,488)
Nonvested restricted stock	(2,737)	(2,928)	(2,868)	(1,487)	(1,577)
Additional paid-in capital	53,765	53,776	53,617	51,972	51,824
Retained earnings	23,053	21,765	20,417	18,709	17,320
Accumulated other comprehensive income	523	747	707	1,128	1,217
Total shareholders' equity	70,412	69,591	68,218	68,729	67,382
Total liabilities and shareholders' equity	$  911,057	$  832,241	$  777,735	$  710,168	$  781,655

COMMON STOCK SUMMARY - Unaudited

			As of
	Sept 30	June 30	Mar 31	Dec 31	Sept 30
(shares in thousands)	2021	2021	2021	2020	2020
Voting common shares outstanding	8,784	8,788	8,784	8,154	8,129
Non-voting common shares outstanding	-	-	-	410	410
Treasury shares outstanding	(530)	(489)	(481)	(234)	(202)
Total common shares outstanding	8,254	8,299	8,303	8,330	8,337
Tangible book value per common share(5)	$     8.41	$     8.27	$     8.09	$  8.12	$   7.95
Stock price:
High	$  10.50	$  10.05	$  10.00	$  7.80	$   6.05
Low	$     9.80	$     9.65	$     7.46	$  5.55	$   4.85
Period end	$  10.30	$     9.90	$     9.90	$  7.75	$   6.05

Footnotes to table located at the end of this release.

ASSET QUALITY MEASURES – Unaudited

	As of
	Sept 30	June 30	Mar 31	Dec 31	Sept 30
(dollars in thousands)	2021	2021	2021	2020	2020
Nonperforming Assets
Commercial
Owner occupied RE	$       526	$       535	$       385	$       394	$       404
Non-owner occupied RE	-	-	-	-	-
Construction	-	-	-	-	-
Commercial business	-	-	-	-	-
Consumer
Real estate	346	383	344	461	346
Home equity	-	-	-	-	-
Construction	-	-	-	-	-
Other	121	129	164	242	299
Nonaccruing troubled debt restructurings	220	235	252	270	291
Total nonaccrual loans	$   1,213	$   1,282	$   1,145	$   1,367	$   1,340
Other real estate owned	150	150	150	164	164
Total nonperforming assets	$   1,363	$   1,432	$   1,295	$   1,531	$   1,504
Nonperforming assets as a percentage of:
Total assets	0.15%	0.17%	0.17%	0.21%	0.19%
Total loans receivable	0.24%	0.27%	0.26%	0.32%	0.31%
Accruing troubled debt restructurings	$   1,444	$   1,478	$   1,544	$   1,584	$   2,508
	Three Months Ended
	Sept 30	June 30	Mar 31	Dec 31	Sept 30
(dollars in thousands)	2021	2021	2021	2020	2020
Allowance for Loan Losses
Balance, beginning of period	$   6,323	$   6,168	$   6,173	$   5,721	$   4,715
Loans charged-off	72	59	55	43	76
Recoveries of loans previously charged-off	583	106	50	145	82
Net charge-offs (recoveries)	(511)	(47)	5	(102)	(6)
Provision for loan losses	100	108	-	350	1,000
Balance, end of period	$   6,934	$   6,323	$   6,168	$   6,173	$   5,721
Allowance for loan losses to gross loans receivable	1.23%	1.20%	1.26%	1.29%	1.20%
Allowance for loan losses to nonaccrual loans	571.64%	493.21%	538.69%	451.57%	426.94%

Our asset quality remained strong through September 30, 2021, with nonperforming assets remaining at $1.4 million.  The ratio of nonperforming assets to total assets decreased to 0.15% at September 30, 2021 from 0.17% at June 30, 2021.  Other real estate owned and repossessed assets remain nominal.  The allowance for loan losses as a percentage of total loans receivable increased slightly to 1.23% at September 30, 2021, compared to 1.20% at June 30, 2021.  The Company had net recoveries of $511 thousand for the three months ended September 30, 2021 compared to net recoveries of $6 thousand for the same period in 2020.  Included in net recoveries for the current quarter was a $532 thousand recovery of a previous charge-off from a single borrower.

LOAN COMPOSITION – Unaudited

	As of
	Sept 30	June 30	Mar 31	Dec 31	Sept 30
(dollars in thousands)	2021	2021	2021	2020	2020
Commercial real estate	$  318,849	$  290,198	$  253,300	$  259,486	$  259,100
Consumer real estate	107,651	97,969	91,504	92,602	92,651
Commercial and industrial	61,778	63,545	60,432	58,445	59,704
PPP	-	-	16,784	-	-
Consumer and other	76,460	74,650	68,306	67,435	67,290
Total loans, net of deferred fees	564,738	526,362	490,326	477,968	478,745
Less allowance for loan losses	6,934	6,323	6,168	6,173	5,721
Total loans, net	$  557,804	$  520,039	$  484,158	$  471,795	$  473,024

DEPOSIT COMPOSITION – Unaudited

	As of
	Sept 30	June 30	Mar 31	Dec 31	Sept 30
(dollars in thousands)	2021	2021	2021	2020	2020
Noninterest-bearing	$  246,534	$  215,814	$  197,831	$  167,274	$  173,628
Interest-bearing:
NOW accounts	133,474	132,269	131,304	120,891	108,152
Money market accounts	216,243	169,707	137,913	119,716	113,203
Savings	59,941	57,880	52,085	46,688	41,549
Time, less than $250,000	103,126	106,219	109,295	105,327	122,139
Time, $250,000 and over	28,183	29,616	32,789	34,104	37,096
Total deposits	$  787,501	$  711,505	$  661,217	$  594,000	$  595,767

Footnotes to tables:

(1)	Total revenue is the sum of net interest income and noninterest income.
(2)	Annualized for the respective period.
(3)	Noninterest expense divided by the sum of net interest income and noninterest income.
(4)	Includes noninterest-bearing and interest-bearing NOW accounts.
(5)	The tangible book value per share is calculated as total shareholders' equity less intangible assets, divided by period-end outstanding common shares.

ABOUT FIRST RELIANCE

Founded in 1999, First Reliance Bancshares, Inc. (OTC: FSRL.OB), is based in Florence, South Carolina and has assets of approximately $911 million.  The Company employs more than 187 professionals and has locations throughout South Carolina and central North Carolina.  First Reliance has redefined community banking with a commitment to making customers lives better, its founding principle.  Customers of the company have given it a 93% customer satisfaction rating, well above the bank industry average of 81%.  First Reliance is also one of three companies throughout South Carolina to receive the Best Places To Work in South Carolina award all 15 years since the program began.  We believe that this recognition confirms that our associates are engaged and committed to our brand and the communities we serve.  In addition to offering a full range of personalized community banking products and services for individuals, small businesses, and corporations, First Reliance offers two unique community-customers programs, which include:  Hometown Heroes, a package of benefits for those serving our communities and Check N Save, an outreach program for the unbanked or under-banked.  We also offer a full suite of digital banking services, a Customer Service Guaranty, a Mortgage Service Guaranty, and are open on most traditional holidays.

FORWARD-LOOKING STATEMENTS

Certain statements in this news release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to future plans and expectations, and are thus prospective.  Such forward-looking statements include, but are not limited to, statements with respect to our plans, objectives, expectations and intentions and other statements that are not historical facts, and other statements identified by words such as "believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," and "projects," as well as similar expressions.  Such statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements.  Although we believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate.  Therefore, we can give no assurance that the results contemplated in the forward-looking statements will be realized.  The inclusion of this forward-looking information should not be construed as a representation by the Company or any person that the future events, plans, or expectations contemplated by the Company will be achieved.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:  (1) competitive pressures among depository and other financial institutions may increase significantly and have an effect on pricing, spending, third-party relationships and revenues; (2) the strength of the United States economy in general and the strength of the local economies in which we conduct operations may be different than expected resulting in, among other things, a deterioration in the credit quality or a reduced demand for credit, including the resultant effect on the Company's loan portfolio and allowance for loan losses; (3) the rate of delinquencies and amounts of charge-offs, the level of allowance for loan loss, the rates of loan growth, or adverse changes in asset quality in our loan portfolio, which may result in increased credit risk-related losses and expenses; (4) the risk that the preliminary financial information reported herein and our current preliminary analysis will be different when our review is finalized; (5) changes in the U.S. legal and regulatory framework including, but not limited to, the Dodd-Frank Act and regulations adopted thereunder; (6) adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) could have a negative impact on the Company, including the value of its MSR asset; (7) the business related to acquisitions may not be integrated successfully or such integration may take longer to accomplish than expected; (8) the expected cost savings and any revenue synergies from acquisitions may not be fully realized within expected timeframes; and (9) disruption from acquisitions may make it more difficult to maintain relationships with clients, associates or suppliers.  Moreover, a trade war or other governmental action related to tariffs or international trade agreements or policies, as well as Covid-19 or other potential epidemics or pandemics, have the potential to negatively impact ours and/or our customers' costs, demand for our customers' products, and/or the U.S. economy or certain sectors thereof and, thus, adversely affect our business, financial condition, and results of operations.  All subsequent written and oral forward-looking statements concerning the Company or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above.  We do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

Contact:
Robert Haile
SEVP & Chief Financial Officer
(843) 656-5000
rhaile@firstreliance.com

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SOURCE First Reliance Bancshares

FAQ

What are the financial results of FSRL for Q3 2021?

FSRL reported a net income of $1.3 million ($0.16 per diluted share) for Q3 2021, down from $4.5 million in the same quarter last year.

How much did FSRL's total assets grow in Q3 2021?

Total assets of FSRL grew by $78.8 million, or 37.9% annualized, reaching $911.1 million as of September 30, 2021.

What was the increase in deposits for FSRL in Q3 2021?

Deposits increased by $76 million, or 42.7% annualized, to $787.5 million in Q3 2021.

What changes occurred in FSRL’s loan portfolio during Q3 2021?

FSRL's total loans increased by $38.4 million, or 29.2% annualized, to $564.7 million in Q3 2021.

What is the status of asset quality for FSRL as of September 2021?

Nonperforming assets decreased to 0.15% of total assets, indicating strong asset quality for FSRL.