Hanover Bancorp, Inc. Reports Earnings for the Fourth Calendar Quarter highlighted by Increased Net Income and Net Interest Income and Strong Non-interest Income
- Net income of $3.8 million for the quarter ended December 31, 2023
- Adjusted net income of $4.0 million for the same period
- Net interest income of $12.7 million
- Non-interest income increased to $3.3 million
- Total deposits grew by 9.8%
- Loans increased by 17.6% annualized
- Approval of a $0.10 per share cash dividend
- Shelf registration filed on Form S-3
- Reduction in net interest income due to rapid rise in interest rates
- Increase in non-interest expense
- Effective tax rate increased to 25.4%
Insights
The reported increase in net income and adjusted net income for Hanover Bancorp, Inc. suggests a positive trajectory in profitability, particularly when considering the adjusted figures which exclude one-time severance and litigation settlement payments. This is indicative of a robust underlying operational performance, which is a critical metric for investors assessing the company's earnings quality.
However, the net interest margin (NIM) compression year-over-year, despite the quarter-over-quarter improvement, raises concerns about the sustainability of interest income in a volatile rate environment. The NIM, a key profitability indicator for banks, reflects the difference between the income generated from interest-earning assets and the cost of servicing liabilities. The reported increase in the cost of interest-bearing liabilities outpacing the yield on earning assets is a trend that investors should monitor closely as it could signal pressure on future margins if the interest rate environment continues to be challenging.
The growth in loan origination, particularly in niche-residential, conventional C&I and SBA loans, points to Hanover's strategic focus on diversifying its lending portfolio. This diversification can mitigate risks associated with economic cycles affecting specific sectors. The reported annualized loan growth rate of 17.6% and the increase in non-interest income represent positive trends that can enhance revenue streams and reduce reliance on interest-based income.
Additionally, the deposit activity highlights successful capital accumulation, with a 9.8% increase from the previous quarter and a strong liquidity position. The growth in insured and collateralized deposits, which tend to be more stable, could provide a cushion against market volatility and is a vital aspect for investors to consider when evaluating the bank's risk profile.
The increase in the effective tax rate due to expanded business activities in other states and the implementation of the CECL accounting standard are external economic factors that have affected Hanover's financials. The CECL adjustment, which requires banks to estimate expected credit losses over the life of loans, resulted in a one-time charge that investors should consider as a non-recurring event when evaluating the bank's performance.
The bank's anticipation of a favorable interest rate environment in 2024 aligns with economic forecasts suggesting a potential stabilization or decrease in rates following aggressive hikes by the Federal Reserve. This could alleviate some of the margin pressures experienced in 2023 and is an essential factor for investors to consider in their long-term outlook on the bank's performance.
Fourth Calendar Quarter Performance Highlights
- Net Income: Net income for the quarter ended December 31, 2023 totaled
$3.8 million or$0.51 per diluted share (including Series A preferred shares), versus$3.5 million or$0.48 per diluted share (including Series A preferred shares) in the prior linked quarter. The Company recorded adjusted (non-GAAP) net income (excluding severance expense) of$4.0 million or$0.54 per diluted share for the quarter ended December 31, 2023, versus adjusted (non-GAAP) net income (excluding litigation settlement payment) of$2.8 million or$0.38 per diluted share for the quarter ended September 30, 2023. - Net Interest Income: Net interest income was
$12.7 million for the quarter ended December 31, 2023, an increase of$0.9 million , or7.3% from the prior linked quarter as new loan growth at current, higher market rates began to mitigate increased funding costs. - Net Interest Margin: The Company’s net interest margin during the quarter ended December 31, 2023 increased to
2.40% from2.29% in the quarter ended September 30, 2023. - Strong Non-interest Income: The Company’s non-interest income increased
$0.5 million or19.1% from the September 30, 2023 quarter (excluding litigation settlement payment) to a record high$3.3 million for the quarter ended December 31, 2023. - Strong Liquidity Position: At December 31, 2023, undrawn liquidity sources, which include cash and unencumbered securities and secured and unsecured funding capacity, totaled
$684.3 million or approximately262% of uninsured deposit balances. - Deposit Activity: Total deposits increased
$169.5 million or9.8% from September 30, 2023. Insured and collateralized deposits, which include municipal deposits, accounted for approximately86% of total deposits at December 31, 2023. - Loan Growth: Loans totaled
$1.96 billion , a net increase of$82.6 million , or17.6% annualized, from September 30, 2023, primarily driven by growth in niche-residential, conventional C&I and SBA loans. - Asset Quality: At December 31, 2023, the Bank’s asset quality remained strong with non-performing loans representing
0.74% of the total loan portfolio and the allowance for credit losses to total loans increasing to1% overall. Loans secured by office space accounted for approximately2.4% of the total loan portfolio with a total balance of$46.5 million , of which less than1% is located in Manhattan. - Banking Initiatives: At December 31, 2023, the Company’s banking initiatives reflected continuing momentum:
- SBA & USDA Banking: Gains on sale of SBA loans totaled
$2.3 million for the quarter ended December 31, 2023, representing a302% increase over the comparable 2022 quarter. Total SBA loans sold were$29.7 million for the quarter ended December 31, 2023, representing a270% increase over the comparable 2022 quarter. Total origination volume nearly doubled from$72 million in 2022 to$141 million in 2023. - C&I Banking: At December 31, 2023, the Bank’s C&I Banking Team, based out of our Hauppauge Business Banking Center, concluded its first year with
$45 million in deposits and$104 million in loan originations. - Residential Lending: The Bank achieved
$77.5 million in closed loans for the quarter ended December 31, 2023 with a weighted average yield of7.27% before origination and other fees, which average 50-100 bps, and a weighted average LTV of63% . Originations for the calendar year ended December 31, 2023 totaled$198.4 million and had a weighted average yield of7.20% .
- SBA & USDA Banking: Gains on sale of SBA loans totaled
- Tangible Book Value Per Share: Tangible book value per share (including Series A preferred shares) was
$22.51 at December 31, 2023 (inclusive of one-time current expected credit loss (“CECL”) implementation adjustment of$3.2 million , net of tax, or$0.43 per share) compared to$22.73 at September 30, 2023 and$21.66 at December 31, 2022. - Quarterly Cash Dividend: The Company’s Board of Directors approved a
$0.10 per share cash dividend on both common and Series A preferred shares payable on February 14, 2024 to stockholders of record on February 7, 2024. - Shelf Registration: In order to access the capital markets efficiently and expeditiously as needed to fuel the continued growth of our highly profitable and successful niche businesses and banking initiatives, the Company filed a shelf registration on Form S-3 concurrent with this earnings release.
MINEOLA, N.Y., Jan. 24, 2024 (GLOBE NEWSWIRE) -- Hanover Bancorp, Inc. (“Hanover” or “the Company” – NASDAQ: HNVR), the holding company for Hanover Community Bank (“the Bank”), today reported results for the quarter ended December 31, 2023 and the declaration of a
Earnings Summary for the Quarter Ended December 31, 2023
The Company reported net income for the quarter ended December 31, 2023 of
The reduction in net income recorded in the fourth calendar quarter of 2023 from the comparable 2022 quarter resulted from two primary factors. The first was a decrease in net interest income primarily related to the rapid rise in interest rates driven by the Federal Reserve as the cost of interest bearing deposits rose faster that the yield on interest earning assets. The second was an increase in non-interest expense largely due to growth related increases in compensation and benefits, occupancy and equipment, federal deposit insurance premiums and other operating expenses, which were partially offset by a decrease in the provision for credit losses and an increase in non-interest income. In addition, the Company’s effective tax rate increased to
Net interest income was
Michael P. Puorro, Chairman and Chief Executive Officer, commented on the Company’s quarterly results: “We are extremely pleased with our fourth calendar quarter results highlighted by a
Balance Sheet Highlights
Total assets at December 31, 2023 were
The Company had
Overall borrowings declined
Stockholders’ equity was
Loan Portfolio Growth, Asset Quality and Allowance for Credit Losses
On a linked quarter basis, the Company exhibited net loan growth of
Historically, the Bank has generated additional income by strategically originating and selling residential and government guaranteed loans to other financial institutions at premiums, while also retaining servicing rights in some sales. However, due to the pace of interest rate increases since 2022, the Bank’s secondary market sale activity for residential loans remains less active, and the Bank continues originating residential loans for its own portfolio. During the quarter ended December 31, 2023 and 2022, the Company sold SBA loans of
The Bank’s asset quality ratios remain strong and among the best in its peer group of community banks. At December 31, 2023, the Company reported
Net Interest Margin
The Bank’s net interest margin increased to
Fiscal Year Change
In October 2023, the Company’s Board of Directors approved a change in the Company’s fiscal year end from September 30 to December 31. Accordingly, the Company is reporting a transition quarter that runs from October 1, 2023 through December 31, 2023. The Company’s next full fiscal year began on January 1, 2024. This change will help our shareholders in reviewing our financial results and evaluating our performance. The change in the Company’s fiscal year had no impact on the Company’s historical consolidated financial position, results of operations, or cash flows.
About Hanover Community Bank and Hanover Bancorp, Inc.
Hanover Bancorp, Inc. (NASDAQ: HNVR), is the bank holding company for Hanover Community Bank, a community commercial bank focusing on highly personalized and efficient services and products responsive to client needs. Management and the Board of Directors are comprised of a select group of successful local businesspeople who are committed to the success of the Bank by knowing and understanding the metro-New York area’s financial needs and opportunities. Backed by state-of-the-art technology, Hanover offers a full range of financial services. Hanover employs a complete suite of consumer, commercial, and municipal banking products and services, including multi-family and commercial mortgages, residential loans, business loans and lines of credit. Hanover also offers its customers access to 24-hour ATM service with no fees attached, free checking with interest, telephone banking, advanced technologies in mobile and internet banking for our consumer and business customers, safe deposit boxes and much more. The Company’s corporate administrative office is located in Mineola, New York where it also operates a full-service branch office along with additional branch locations in Garden City Park, Hauppauge, Forest Hills, Flushing, Sunset Park, Rockefeller Center and Chinatown, New York, and Freehold, New Jersey.
Hanover Community Bank is a member of the Federal Deposit Insurance Corporation and is an Equal Housing/Equal Opportunity Lender. For further information, call (516) 548-8500 or visit the Bank’s website at www.hanoverbank.com.
Non-GAAP Disclosure
This discussion includes non-GAAP financial measures, including the Company’s adjusted net income, adjusted returns on average assets and shareholders’ equity, adjusted operating efficiency ratio, and tangible common equity. A non-GAAP financial measure is a numerical measure of historical or future performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The Company’s management believes that the presentation of non-GAAP financial measures provides both management and investors with a greater understanding of the Company’s operating results and trends in addition to the results measured in accordance with GAAP, and provides greater comparability across time periods. While management uses non-GAAP financial measures in its analysis of the Company’s performance, this information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with U.S. GAAP or considered to be more important than financial results determined in accordance with U.S. GAAP. The Company’s non-GAAP financial measures may not be comparable to similarly titled measures used by other financial institutions.
With respect to the calculations of adjusted net income and adjusted operating efficiency ratio for the periods presented in this discussion, reconciliations to the most comparable U.S. GAAP measures are provided in the tables that follow.
Forward-Looking Statements
This release may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and may be identified by the use of such words as "may," "believe," "expect," "anticipate," "should," "plan," "estimate," "predict," "continue," and "potential" or the negative of these terms or other comparable terminology. Examples of forward-looking statements include, but are not limited to, estimates with respect to the financial condition, results of operations and business of Hanover Bancorp, Inc. Any or all of the forward-looking statements in this release and in any other public statements made by Hanover Bancorp, Inc. may turn out to be incorrect. They can be affected by inaccurate assumptions that Hanover Bancorp, Inc. might make or by known or unknown risks and uncertainties, including those discussed in our Annual Report on Form 10-K under Item 1A - Risk Factors, as updated by our subsequent filings with the Securities and Exchange Commission. Further, the adverse effect of the COVID-19 pandemic on the Company, its customers, and the communities where it operates may adversely affect the Company’s business, results of operations and financial condition for an indefinite period of time. Consequently, no forward-looking statement can be guaranteed. Hanover Bancorp, Inc. does not intend to update any of the forward-looking statements after the date of this release or to conform these statements to actual events.
This release does not constitute an offer of any securities for sale.
Investor and Press Contact:
Lance P. Burke
Chief Financial Officer
(516) 548-8500
| HANOVER BANCORP, INC. | |||||||||||||
| STATEMENTS OF CONDITION (unaudited) | |||||||||||||
| (dollars in thousands) | |||||||||||||
| December 31, | September 30, | December 31, | |||||||||||
| 2023 | 2023 | 2022 | |||||||||||
| Assets | |||||||||||||
| Cash and cash equivalents | $ | 177,207 | $ | 192,624 | $ | 152,298 | |||||||
| Securities-available for sale, at fair value | 61,419 | 10,889 | 12,151 | ||||||||||
| Investments-held to maturity | 4,041 | 4,108 | 4,336 | ||||||||||
| Loans held for sale | 8,332 | - | - | ||||||||||
| Loans, net of deferred loan fees and costs | 1,957,199 | 1,874,562 | 1,746,810 | ||||||||||
| Less: allowance for credit losses(1) | (19,658 | ) | (14,686 | ) | (14,404 | ) | |||||||
| Loans, net | 1,937,541 | 1,859,876 | 1,732,406 | ||||||||||
| Goodwill | 19,168 | 19,168 | 19,168 | ||||||||||
| Premises & fixed assets | 15,886 | 16,057 | 14,886 | ||||||||||
| Operating lease assets | 9,754 | 10,193 | 11,409 | ||||||||||
| Other assets | 36,712 | 36,620 | 37,038 | ||||||||||
| Assets | $ | 2,270,060 | $ | 2,149,535 | $ | 1,983,692 | |||||||
| Liabilities and stockholders' equity | |||||||||||||
| Core deposits | $ | 1,382,397 | $ | 1,204,994 | $ | 1,128,394 | |||||||
| Time deposits | 522,198 | 530,076 | 389,256 | ||||||||||
| Total deposits | 1,904,595 | 1,735,070 | 1,517,650 | ||||||||||
| Borrowings | 128,953 | 179,849 | 238,273 | ||||||||||
| Subordinated debentures | 24,635 | 24,621 | 24,581 | ||||||||||
| Operating lease liabilities | 10,459 | 10,899 | 12,063 | ||||||||||
| Other liabilities | 16,588 | 13,189 | 13,497 | ||||||||||
| Liabilities | 2,085,230 | 1,963,628 | 1,806,064 | ||||||||||
| Stockholders' equity | 184,830 | 185,907 | 177,628 | ||||||||||
| Liabilities and stockholders' equity | $ | 2,270,060 | $ | 2,149,535 | $ | 1,983,692 | |||||||
| (1) CECL was adopted effective 10/1/23. Prior periods were based on the incurred loss methodology. | |||||||||||||
| HANOVER BANCORP, INC. | |||||||
| CONSOLIDATED STATEMENTS OF INCOME (unaudited) | |||||||
| (dollars in thousands, except per share data) | |||||||
| Three Months Ended | |||||||
| 12/31/2023 | 12/31/2022 | ||||||
| Interest income | $ | 31,155 | $ | 22,572 | |||
| Interest expense | 18,496 | 7,308 | |||||
| Net interest income | 12,659 | 15,264 | |||||
| Provision for credit losses(1) | 200 | 1,500 | |||||
| Net interest income after provision for credit losses | 12,459 | 13,764 | |||||
| Loan servicing and fee income | 778 | 678 | |||||
| Service charges on deposit accounts | 85 | 63 | |||||
| Gain on sale of loans held-for-sale | 2,326 | 578 | |||||
| Other operating income | 65 | 92 | |||||
| Non-interest income | 3,254 | 1,411 | |||||
| Compensation and benefits | 5,242 | 4,332 | |||||
| Occupancy and equipment | 1,746 | 1,477 | |||||
| Data processing | 530 | 418 | |||||
| Professional fees | 729 | 683 | |||||
| Federal deposit insurance premiums | 375 | 158 | |||||
| Other operating expenses | 2,048 | 1,203 | |||||
| Non-interest expense | 10,670 | 8,271 | |||||
| Income before income taxes | 5,043 | 6,904 | |||||
| Income tax expense | 1,280 | 1,566 | |||||
| Net income | $ | 3,763 | $ | 5,338 | |||
| Earnings per share ("EPS"):(2) | |||||||
| Basic | $ | 0.51 | $ | 0.73 | |||
| Diluted | $ | 0.51 | $ | 0.72 | |||
| Average shares outstanding for basic EPS(2)(3) | 7,324,133 | 7,292,940 | |||||
| Average shares outstanding for diluted EPS(2)(3) | 7,383,529 | 7,387,938 | |||||
| (1) CECL was adopted effective 10/1/23. Prior periods were based on the incurred loss methodology. | |||||||
| (2) Calculation includes common stock and Series A preferred stock. | |||||||
| (3) Average shares outstanding before subtracting participating securities. | |||||||
| Note: Prior period information has been adjusted to conform to current period presentation. | |||||||
| HANOVER BANCORP, INC. | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME (unaudited) | ||||||||||||||||
| QUARTERLY TREND | ||||||||||||||||
| (dollars in thousands, except per share data) | ||||||||||||||||
| Three Months Ended | ||||||||||||||||
| 12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | 12/31/2022 | ||||||||||||
| Interest income | $ | 31,155 | $ | 28,952 | $ | 28,459 | $ | 25,060 | $ | 22,572 | ||||||
| Interest expense | 18,496 | 17,153 | 14,954 | 11,136 | 7,308 | |||||||||||
| Net interest income | 12,659 | 11,799 | 13,505 | 13,924 | 15,264 | |||||||||||
| Provision for credit losses(1) | 200 | 500 | 500 | 932 | 1,500 | |||||||||||
| Net interest income after provision for credit losses | 12,459 | 11,299 | 13,005 | 12,992 | 13,764 | |||||||||||
| Loan servicing and fee income | 778 | 681 | 811 | 539 | 678 | |||||||||||
| Service charges on deposit accounts | 85 | 75 | 70 | 67 | 63 | |||||||||||
| Gain on sale of loans held-for-sale | 2,326 | 1,468 | 1,052 | 995 | 578 | |||||||||||
| Other operating income | 65 | 1,483 | 41 | 155 | 92 | |||||||||||
| Non-interest income | 3,254 | 3,707 | 1,974 | 1,756 | 1,411 | |||||||||||
| Compensation and benefits | 5,242 | 5,351 | 5,405 | 5,564 | 4,332 | |||||||||||
| Occupancy and equipment | 1,746 | 1,758 | 1,587 | 1,537 | 1,477 | |||||||||||
| Data processing | 530 | 516 | 576 | 441 | 418 | |||||||||||
| Professional fees | 729 | 800 | 781 | 881 | 683 | |||||||||||
| Federal deposit insurance premiums | 375 | 386 | 357 | 358 | 158 | |||||||||||
| Other operating expenses | 2,048 | 1,506 | 1,860 | 1,786 | 1,203 | |||||||||||
| Non-interest expense | 10,670 | 10,317 | 10,566 | 10,567 | 8,271 | |||||||||||
| Income before income taxes | 5,043 | 4,689 | 4,413 | 4,181 | 6,904 | |||||||||||
| Income tax expense | 1,280 | 1,166 | 1,319 | 972 | 1,566 | |||||||||||
| Net income | $ | 3,763 | $ | 3,523 | $ | 3,094 | $ | 3,209 | $ | 5,338 | ||||||
| Earnings per share ("EPS"):(2) | ||||||||||||||||
| Basic | $ | 0.51 | $ | 0.48 | $ | 0.42 | $ | 0.44 | $ | 0.73 | ||||||
| Diluted | $ | 0.51 | $ | 0.48 | $ | 0.42 | $ | 0.43 | $ | 0.72 | ||||||
| Average shares outstanding for basic EPS(2)(3) | 7,324,133 | 7,327,345 | 7,332,090 | 7,324,036 | 7,292,940 | |||||||||||
| Average shares outstanding for diluted EPS(2)(3) | 7,383,529 | 7,407,483 | 7,407,613 | 7,406,933 | 7,387,938 | |||||||||||
| (1) CECL was adopted effective 10/1/23. Prior periods were based on the incurred loss methodology. | ||||||||||||||||
| (2) Calculation includes common stock and Series A preferred stock. | ||||||||||||||||
| (3) Average shares outstanding before subtracting participating securities. | ||||||||||||||||
| Note: Prior period information has been adjusted to conform to current period presentation. | ||||||||||||||||
| HANOVER BANCORP, INC. | ||||||||||||
| CONSOLIDATED NON-GAAP FINANCIAL INFORMATION (1) (unaudited) | ||||||||||||
| (dollars in thousands, except per share data) | ||||||||||||
| Three Months Ended | ||||||||||||
| 12/31/2023 | 9/30/2023 | 12/31/2022 | ||||||||||
| ADJUSTED NET INCOME: | ||||||||||||
| Net income, as reported | $ | 3,763 | $ | 3,523 | $ | 5,338 | ||||||
| Adjustments: | ||||||||||||
| Litigation settlement payment | - | (975 | ) | - | ||||||||
| Severance expense | 321 | - | - | |||||||||
| Total adjustments, before income taxes | 321 | (975 | ) | - | ||||||||
| Adjustment for reported effective income tax rate | 81 | (243 | ) | - | ||||||||
| Total adjustments, after income taxes | 240 | (732 | ) | - | ||||||||
| Adjusted net income | $ | 4,003 | $ | 2,791 | $ | 5,338 | ||||||
| Basic earnings per share - adjusted | $ | 0.55 | $ | 0.38 | $ | 0.73 | ||||||
| Diluted earnings per share - adjusted | $ | 0.54 | $ | 0.38 | $ | 0.72 | ||||||
| ADJUSTED OPERATING EFFICIENCY RATIO: | ||||||||||||
| Operating efficiency ratio, as reported | 67.05 | % | 66.53 | % | 49.60 | % | ||||||
| Adjustments: | ||||||||||||
| Litigation settlement payment | 0.00 | % | 4.47 | % | 0.00 | % | ||||||
| Severance expense | -2.02 | % | 0.00 | % | 0.00 | % | ||||||
| Adjusted operating efficiency ratio | 65.03 | % | 71.00 | % | 49.60 | % | ||||||
| ADJUSTED RETURN ON AVERAGE ASSETS | 0.74 | % | 0.53 | % | 1.18 | % | ||||||
| ADJUSTED RETURN ON AVERAGE EQUITY | 8.61 | % | 6.00 | % | 12.04 | % | ||||||
| (1) A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with U.S. GAAP. While management uses non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with U.S. GAAP or considered to be more important than financial results determined in accordance with U.S. GAAP. | ||||||||||||
| HANOVER BANCORP, INC. | |||||||
| SELECTED FINANCIAL DATA (unaudited) | |||||||
| (dollars in thousands) | |||||||
| Three Months Ended | |||||||
| 12/31/2023 | 12/31/2022 | ||||||
| Profitability: | |||||||
| Return on average assets | 0.69 | % | 1.18 | % | |||
| Return on average equity(1) | 8.10 | % | 12.04 | % | |||
| Return on average tangible equity(1) | 9.06 | % | 13.54 | % | |||
| Pre-provision net revenue to average assets | 0.97 | % | 1.86 | % | |||
| Yield on average interest-earning assets | 5.91 | % | 5.17 | % | |||
| Cost of average interest-bearing liabilities | 4.19 | % | 2.08 | % | |||
| Net interest rate spread(2) | 1.72 | % | 3.09 | % | |||
| Net interest margin(3) | 2.40 | % | 3.49 | % | |||
| Non-interest expense to average assets | 1.97 | % | 1.83 | % | |||
| Operating efficiency ratio | 67.05 | % | 49.60 | % | |||
| Average balances: | |||||||
| Interest-earning assets | $ | 2,090,839 | $ | 1,733,739 | |||
| Interest-bearing liabilities | 1,751,330 | 1,391,875 | |||||
| Loans | 1,910,409 | 1,681,460 | |||||
| Deposits | 1,767,753 | 1,472,982 | |||||
| Borrowings | 170,793 | 123,149 | |||||
| (1) Includes common stock and Series A preferred stock. | |||||||
| (2) Represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities. | |||||||
| (3) Represents net interest income divided by average interest-earning assets. | |||||||
| HANOVER BANCORP, INC. | |||||||||||||||
| SELECTED FINANCIAL DATA (unaudited) | |||||||||||||||
| (dollars in thousands, except share and per share data) | |||||||||||||||
| At or For the Three Months Ended | |||||||||||||||
| 12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | ||||||||||||
| Asset quality: | |||||||||||||||
| Provision for credit losses | $ | 200 | $ | 500 | $ | 500 | $ | 932 | |||||||
| Net (charge-offs)/recoveries | 677 | (1,183 | ) | (10 | ) | (457 | ) | ||||||||
| Allowance for credit losses | 19,658 | 14,686 | 15,369 | 14,879 | |||||||||||
| Allowance for credit losses to total loans(1) | 1.00 | % | 0.78 | % | 0.84 | % | 0.83 | % | |||||||
| Non-performing loans(2)(3)(4) | $ | 14,451 | $ | 15,061 | $ | 10,785 | $ | 11,031 | |||||||
| Non-performing loans/total loans | 0.74 | % | 0.80 | % | 0.59 | % | 0.62 | % | |||||||
| Non-performing loans/total assets | 0.64 | % | 0.70 | % | 0.51 | % | 0.53 | % | |||||||
| Allowance for credit losses/non-performing loans | 136.03 | % | 97.51 | % | 142.50 | % | 134.88 | % | |||||||
| Capital (Bank only): | |||||||||||||||
| Tier 1 Capital | $ | 193,324 | $ | 190,928 | $ | 188,568 | $ | 185,449 | |||||||
| Tier 1 leverage ratio | 9.08 | % | 9.16 | % | 9.16 | % | 9.79 | % | |||||||
| Common equity tier 1 capital ratio | 13.09 | % | 13.55 | % | 13.16 | % | 12.88 | % | |||||||
| Tier 1 risk based capital ratio | 13.09 | % | 13.55 | % | 13.16 | % | 12.88 | % | |||||||
| Total risk based capital ratio | 14.22 | % | 14.60 | % | 14.24 | % | 13.93 | % | |||||||
| Equity data: | |||||||||||||||
| Shares outstanding(5) | 7,345,012 | 7,320,419 | 7,334,120 | 7,331,092 | |||||||||||
| Stockholders' equity | $ | 184,830 | $ | 185,907 | $ | 182,806 | $ | 180,522 | |||||||
| Book value per share(5) | 25.16 | 25.40 | 24.93 | 24.62 | |||||||||||
| Tangible common equity(5) | 165,351 | 166,412 | 163,294 | 160,992 | |||||||||||
| Tangible book value per share(5) | 22.51 | 22.73 | 22.26 | 21.96 | |||||||||||
| Tangible common equity ("TCE") ratio(5) | 7.35 | % | 7.81 | % | 7.77 | % | 7.84 | % | |||||||
| (1) Calculation excludes loans held for sale. | |||||||||||||||
| (2) Includes | |||||||||||||||
| (3) Includes | |||||||||||||||
| (4) Includes | |||||||||||||||
| (5) Includes common stock and Series A preferred stock. | |||||||||||||||
| Note: Prior period information has been adjusted to conform to current period presentation. | |||||||||||||||
| HANOVER BANCORP, INC. | |||||||||||||||||
| STATISTICAL SUMMARY | |||||||||||||||||
| QUARTERLY TREND | |||||||||||||||||
| (unaudited, dollars in thousands, except share data) | |||||||||||||||||
| 12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | ||||||||||||||
| Loan distribution(1): | |||||||||||||||||
| Residential mortgages | $ | 689,211 | $ | 630,374 | $ | 598,747 | $ | 567,106 | |||||||||
| Multifamily | 572,849 | 578,895 | 583,837 | 588,244 | |||||||||||||
| Commercial real estate | 561,183 | 550,334 | 546,120 | 541,924 | |||||||||||||
| Commercial & industrial | 107,912 | 87,575 | 67,918 | 59,184 | |||||||||||||
| Home equity | 25,631 | 26,959 | 26,517 | 30,664 | |||||||||||||
| Consumer | 413 | 425 | 364 | 243 | |||||||||||||
| Total loans | $ | 1,957,199 | $ | 1,874,562 | $ | 1,823,503 | $ | 1,787,365 | |||||||||
| Sequential quarter growth rate | 4.41 | % | 2.80 | % | 2.02 | % | 2.32 | % | |||||||||
| Loans sold during the quarter | $ | 29,740 | $ | 18,403 | $ | 12,610 | $ | 12,756 | |||||||||
| Funding distribution: | |||||||||||||||||
| Demand | $ | 207,781 | $ | 185,731 | $ | 180,303 | $ | 178,592 | |||||||||
| N.O.W. | 661,276 | 503,704 | 480,108 | 627,102 | |||||||||||||
| Savings | 47,608 | 54,502 | 67,626 | 79,414 | |||||||||||||
| Money market | 465,732 | 461,057 | 409,097 | 391,314 | |||||||||||||
| Total core deposits | 1,382,397 | 1,204,994 | 1,137,134 | 1,276,422 | |||||||||||||
| Time | 522,198 | 530,076 | 456,505 | 430,852 | |||||||||||||
| Total deposits | 1,904,595 | 1,735,070 | 1,593,639 | 1,707,274 | |||||||||||||
| Borrowings | 128,953 | 179,849 | 293,849 | 136,962 | |||||||||||||
| Subordinated debentures | 24,635 | 24,621 | 24,608 | 24,594 | |||||||||||||
| Total funding sources | $ | 2,058,183 | $ | 1,939,540 | $ | 1,912,096 | $ | 1,868,830 | |||||||||
| Sequential quarter growth rate - total deposits | 9.77 | % | 8.87 | % | -6.66 | % | 12.49 | % | |||||||||
| Period-end core deposits/total deposits ratio | 72.58 | % | 69.45 | % | 71.35 | % | 74.76 | % | |||||||||
| Period-end demand deposits/total deposits ratio | 10.91 | % | 10.70 | % | 11.31 | % | 10.46 | % | |||||||||
| (1) Excluding loans held for sale | |||||||||||||||||
| HANOVER BANCORP, INC. | ||||||||||||||||||||
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES(1)(unaudited) | ||||||||||||||||||||
| (dollars in thousands, except share and per share amounts) | ||||||||||||||||||||
| 12/31/2023 | 9/30/2023 | 6/30/2023 | 3/31/2023 | 12/31/2022 | ||||||||||||||||
| Tangible common equity | ||||||||||||||||||||
| Total equity(2) | $ | 184,830 | $ | 185,907 | $ | 182,806 | $ | 180,522 | $ | 177,628 | ||||||||||
| Less: goodwill | (19,168 | ) | (19,168 | ) | (19,168 | ) | (19,168 | ) | (19,168 | ) | ||||||||||
| Less: core deposit intangible | (311 | ) | (327 | ) | (344 | ) | (362 | ) | (381 | ) | ||||||||||
| Tangible common equity(2) | $ | 165,351 | $ | 166,412 | $ | 163,294 | $ | 160,992 | $ | 158,079 | ||||||||||
| Tangible common equity ("TCE") ratio | ||||||||||||||||||||
| Tangible common equity(2) | $ | 165,351 | $ | 166,412 | $ | 163,294 | $ | 160,992 | $ | 158,079 | ||||||||||
| Total assets | 2,270,060 | 2,149,632 | 2,121,783 | 2,071,720 | 1,983,692 | |||||||||||||||
| Less: goodwill | (19,168 | ) | (19,168 | ) | (19,168 | ) | (19,168 | ) | (19,168 | ) | ||||||||||
| Less: core deposit intangible | (311 | ) | (327 | ) | (344 | ) | (362 | ) | (381 | ) | ||||||||||
| Tangible assets | $ | 2,250,581 | $ | 2,130,137 | $ | 2,102,271 | $ | 2,052,190 | $ | 1,964,143 | ||||||||||
| TCE ratio(2) | 7.35 | % | 7.81 | % | 7.77 | % | 7.84 | % | 8.05 | % | ||||||||||
| Tangible book value per share | ||||||||||||||||||||
| Tangible equity(2) | $ | 165,351 | $ | 166,412 | $ | 163,294 | $ | 160,992 | $ | 158,079 | ||||||||||
| Shares outstanding(2) | 7,345,012 | 7,320,419 | 7,334,120 | 7,331,092 | 7,299,000 | |||||||||||||||
| Tangible book value per share(2) | $ | 22.51 | $ | 22.73 | $ | 22.26 | $ | 21.96 | $ | 21.66 | ||||||||||
| (1) A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The Company’s management believes the presentation of non-GAAP financial measures provide investors with a greater understanding of the Company’s operating results in addition to the results measured in accordance with U.S. GAAP. While management uses non-GAAP measures in its analysis of the Company’s performance, this information should not be viewed as a substitute for financial results determined in accordance with U.S. GAAP or considered to be more important than financial results determined in accordance with U.S. GAAP. | ||||||||||||||||||||
| (2) Includes common stock and Series A preferred stock. | ||||||||||||||||||||
| HANOVER BANCORP, INC. | |||||||||||||||||
| NET INTEREST INCOME ANALYSIS | |||||||||||||||||
| For the Three Months Ended December 31, 2023 and 2022 | |||||||||||||||||
| (unaudited, dollars in thousands) | |||||||||||||||||
| 2023 | 2022 | ||||||||||||||||
| Average | Average | Average | Average | ||||||||||||||
| Balance | Interest | Yield/Cost | Balance | Interest | Yield/Cost | ||||||||||||
| Assets: | |||||||||||||||||
| Interest-earning assets: | |||||||||||||||||
| Loans | $ | 1,910,409 | $ | 28,394 | 5.90 | % | $ | 1,681,460 | $ | 21,979 | 5.19 | % | |||||
| Investment securities | 56,834 | 940 | 6.56 | % | 16,509 | 212 | 5.09 | % | |||||||||
| Interest-earning cash | 114,033 | 1,570 | 5.46 | % | 29,281 | 275 | 3.73 | % | |||||||||
| FHLB stock and other investments | 9,563 | 251 | 10.41 | % | 6,489 | 106 | 6.48 | % | |||||||||
| Total interest-earning assets | 2,090,839 | 31,155 | 5.91 | % | 1,733,739 | 22,572 | 5.17 | % | |||||||||
| Non interest-earning assets: | |||||||||||||||||
| Cash and due from banks | 7,429 | 10,614 | |||||||||||||||
| Other assets | 50,677 | 52,493 | |||||||||||||||
| Total assets | $ | 2,148,945 | $ | 1,796,846 | |||||||||||||
| Liabilities and stockholders' equity: | |||||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||||
| Savings, N.O.W. and money market deposits | $ | 1,039,062 | $ | 11,547 | 4.41 | % | $ | 910,732 | $ | 4,764 | 2.08 | % | |||||
| Time deposits | 541,475 | 5,231 | 3.83 | % | 357,994 | 1,547 | 1.71 | % | |||||||||
| Total savings and time deposits | 1,580,537 | 16,778 | 4.21 | % | 1,268,726 | 6,311 | 1.97 | % | |||||||||
| Borrowings | 146,167 | 1,392 | 3.78 | % | 98,576 | 663 | 2.67 | % | |||||||||
| Subordinated debentures | 24,626 | 326 | 5.25 | % | 24,573 | 334 | 5.39 | % | |||||||||
| Total interest-bearing liabilities | 1,751,330 | 18,496 | 4.19 | % | 1,391,875 | 7,308 | 2.08 | % | |||||||||
| Demand deposits | 187,216 | 204,256 | |||||||||||||||
| Other liabilities | 26,031 | 24,793 | |||||||||||||||
| Total liabilities | 1,964,577 | 1,620,924 | |||||||||||||||
| Stockholders' equity | 184,368 | 175,922 | |||||||||||||||
| Total liabilities & stockholders' equity | $ | 2,148,945 | $ | 1,796,846 | |||||||||||||
| Net interest rate spread | 1.72 | % | 3.09 | % | |||||||||||||
| Net interest income/margin | $ | 12,659 | 2.40 | % | $ | 15,264 | 3.49 | % | |||||||||
FAQ
What was Hanover Bancorp's net income for the quarter ended December 31, 2023?
What was the adjusted net income for the same period?
How much was the net interest income for the quarter ended December 31, 2023?
By how much did total deposits grow from September 30, 2023?
What was the cash dividend approved by the Board of Directors?
What type of registration did the company file concurrent with the earnings release?
