Integrated Financial Holdings, Inc. First Quarter 2022 Financial Results

Rhea-AI Summary

Integrated Financial Holdings, Inc. (OTCQX: IFHI) reported first quarter 2022 net income of $3.6 million or $1.59 per diluted share, a decrease from last year's $3.9 million or $1.76. Loan processing revenues fell to $2.7 million, down from $8.8 million in Q1 2021. Despite a decrease in total assets by 5%, shareholders’ equity rose by 3%. The return on equity dropped to 15.97% from 20.30%. A decrease in noninterest expenses by 18% to $10.4 million was noted. The bank maintains strong asset quality and anticipates continued loan demand despite rising rates affecting the mortgage market.

Positive

• Net interest income increased by $869,000 or 23% year-over-year.
• Noninterest expense decreased by $2.3 million or 18% compared to Q1 2021.
• Increase in total shareholders’ equity by $2.8 million or 3%.

Negative

• Net income decreased by $300,000 compared to Q1 2021.
• Loan processing and servicing revenue dropped by $6.1 million or 69% year-over-year.
• Return on average assets decreased from 3.99% to 3.30%.

RALEIGH, N.C., May 04, 2022 (GLOBE NEWSWIRE) -- Integrated Financial Holdings, Inc. (OTCQX: IFHI) (the “Company” or “IFH”), the financial holding company for West Town Bank & Trust (“the Bank”), released its financial results for the three months ended March 31, 2022. The first quarter of 2022 was the first quarter in two years where income was only minimally impacted by revenues associated with the Paycheck Protection Program (“PPP”). Highlights from the 2022 first quarter include the following:

• First quarter net income of $3.6 million or $1.59 per diluted share, compared to first quarter 2021 net income of $3.9 million or $1.76 per diluted share.
• Provision for loan losses of $180,000 for the first quarter of 2022, compared to $622,000 for the same period in 2021.
• Return on average assets of 3.30%, compared to 3.99% for the first quarter of 2021.
• Return on average common equity of 15.97%, compared to 20.30% for the first quarter of 2021.
• Return on average tangible common equity (a non-GAAP financial measure) of 20.36%, compared to 27.28% for the first quarter of 2021.
• Loan processing and servicing revenue of $2.7 million, compared to $8.8 million for the first quarter of 2021.
• Government lending revenues of $1.1 million, compared to $1.3 million for the first quarter of 2021.
• Mortgage origination and sales revenue of $173,000, compared to $1.7 million for the first quarter of 2021.
• Other noninterest income $6.5 million, compared to income of $2.2 million for the first quarter of 2021.
  

Eric Bergevin, President & CEO of IFH, stated, “The Company had a solid first quarter while adjusting for rising rates. With PPP in the rearview mirror, our focus continues to be on growing our loan pipeline and diversifying our loan verticals. We sold the majority of our variable rate SBA 7(a) loans during the quarter, but there were significant disruptions in the secondary market for interim fixed rate loans with 5-year repricing options due to rising rates. Accordingly, we continued to hold these USDA loans and will make them available for sale when stabilization of these premiums is recognized. The mortgage market has seen a significant increase in mortgage rates, but demand for purchase loans remains strong. We do have concerns regarding the outlook of the mortgage market in general as secondary market premiums continue to be compressed by investors and competitors across the board. We have solid purchase volume and are keeping a watchful eye out for relief on margins. Asset quality remains good, and we are seeing many items resolve themselves now that the courts are back in session and hearings are moving along. We had a short-term increase in our past due ratios in the first quarter, but those have mostly resolved themselves and we are seeing the ratios normalize quickly. Windsor continues to grow its servicing book and enhance Bank lending participations, growing its overall value. We anticipate that it will continue to be an earnings driver for the company well into and past 2022. Overall, we are off to a good start in 2022 and anticipate continued strong loan demand. We are poised to start selling fixed term loans in the near future once markets stabilize to further facilitate our earnings stream.”

BALANCE SHEET
On March 31, 2022, the Company’s total assets were $430.6 million, net loans held for investment were $262.3 million, loans held for sale (“HFS”) were $51.1 million, total deposits were $326.5 million and total shareholders’ equity attributable to IFH was $91.3 million. Compared with December 31, 2021, total assets decreased $22.3 million or 5%, net loans held for investment increased $2.7 million or 1%, HFS loans increased $23.2 million or 83%, total deposits decreased $21.7 million or 6%, and total shareholders’ equity attributable to IFH increased $2.8 million or 3%. The asset side of the balance sheet saw a favorable shift in mix as a large portion of the excess cash held at the Federal Reserve was redeployed into loans. The Bank has continued to see strong growth in originated for sale loans primarily as a result of a strong loan pipeline for the Government Guaranteed Lending (“GGL”) type loans. At $51.1 million in volume, HFS loans at March 31, 2022 represent significant potential future GGL revenues as those loans are sold in the market and the associated premiums are recognized. Noninterest bearing deposits declined $21.8 million during the quarter, in part, as a result of some ongoing merger and acquisition activity in one of the targeted industries that the Company banks; however, management believes the continued execution of strategic advances into the hemp banking space (trademarked “Hemp Banks Here”) will continue to drive strong deposit growth. The increase in total shareholders’ equity was primarily a result of net income posted for the first quarter of the year.

CAPITAL LEVELS
At March 31, 2022, the regulatory capital ratios of West Town Bank & Trust exceeded the minimum thresholds established for well-capitalized banks under applicable banking regulations.

	"Well Capitalized" Minimum	Basel III Fully Phased-In	West Town Bank & Trust
Tier 1 common equity ratio	6.50%	7.00%	15.77%
Tier 1 risk-based capital ratio	8.00%	8.50%	15.77%
Total risk-based capital ratio	10.00%	10.50%	17.03%
Tier 1 leverage ratio	5.00%	4.00%	11.70%

The Company’s book value per common share increased from $36.08 as of March 31, 2021, to $40.86 at March 31, 2022. The Company’s tangible book value per common share (a non-GAAP financial measure) increased from $27.16 as of March 31, 2021, to $32.21 at March 31, 2022, primarily as a result of the net income of the Company.

ASSET QUALITY
The Company’s nonperforming assets to total assets ratio decreased from 1.65% at December 31, 2021, to 1.52% at March 31, 2022, as management continued to aggressively work to reduce its special assets portfolio. Nonaccrual loans at March 31, 2022 decreased $290,000 or 4% as compared to December 31, 2021. The last foreclosed property held by Patriarch, LLC, a subsidiary of the Company formed to expedite the liquidation and recovery of certain Bank assets, was fully liquidated during the first quarter of 2022. Neither Patriarch, LLC, nor the Bank held any foreclosed assets at March 31, 2022.  

The Company recorded a $180,000 provision for loan losses during the first quarter of 2022, as compared to a provision of $622,000 in first quarter 2021, as the problem loan portfolio decreased for the period.   The Bank has granted 143 deferrals since the onset of the COVID-19 pandemic totaling $72 million in exposure to the Bank.  However, as of March 31, 2022, there were only eight loans in a deferred status with net exposure to the Bank of $2.4 million. The Company recorded $105,000 in net charge-offs during the first quarter of 2022 as management continued to make progress in improving overall asset quality. Set forth in the table below is certain asset quality information as of the dates indicated:

(Dollars in thousands)	3/31/22			12/31/21			9/30/21			6/30/21			3/31/21
Nonaccrual loans	$	6,558		$	6,848		$	7,575		$	5,765		$	7,341
Foreclosed assets		-			618			618			618			1,377
90 days past due and still accruing		-			-			-			447			-
Total nonperforming assets	$	6,558		$	7,466		$	8,193		$	6,830		$	8,718
Net charge-offs	$	105		$	1,038		$	325		$	24		$	156
Annualized net charge-offs to total average portfolio loans		0.16	%		1.65	%		0.50	%		0.03	%		0.24	%
Ratio of total nonperforming assets to total assets		1.52	%		1.65	%		1.84	%		1.55	%		2.14	%
Ratio of total nonperforming loans to total loans, net
of allowance		2.56	%		2.70	%		2.99	%		2.40	%		2.69	%
Ratio of total allowance for loan losses to total loans		2.14	%		2.14	%		2.24	%		2.13	%		2.02	%

NET INTEREST INCOME AND MARGIN
Net interest income for the three months ended March 31, 2022, increased $869,000 or 23% in comparison to the first quarter of 2021 as loan yields increased year over year from 6.24% to 7.74%. Loan yield was positively impacted by the one-time impact of $766,000 in recapture of nonaccrual loan interest on several large problems loans settled during the quarter. Excluding that interest income recapture, loan yield would have been 6.69% with the increase in yield from the prior year resulting from a change in loan mix and slightly reflecting the impact of the 0.25% rate increase by the Federal Open Market Committee (“FOMC”) in the first quarter of 2022 in response to current economic conditions. Overall cost of funds decreased from 0.91% in the first quarter of 2021 to 0.63% for the same period in 2022. The Company continues to see a downward trend in its average retail CD rates as new CDs are originated at a lower market rate. Net interest margin increased from 4.55% during the three months ended March 31, 2021 to 5.69% for the same period in 2022. The increase in margin in the portfolio was also impacted by the previously mentioned nonaccrual interest income recapture. Excluding that impact, net interest margin would have been 4.86% with the adjusted increase primarily attributable to a continued quarter-over-quarter decrease in cost of funds.   Cost of funds has decreased for nine consecutive quarters at the Company.

	Three Months Ended
(Dollars in thousands)	3/31/22		12/31/21		9/30/21		6/30/21		3/31/21
Average balances:
Loans	$	294,502	$	277,510	$	272,994	$	292,166	$	288,700
Available-for-sale securities		21,088		20,367		19,393		17,969		16,044
Other interest-bearing balances		56,359		86,261		93,682		46,545		35,981
Total interest-earning assets		371,949		384,138		386,069		356,680		340,725
Total assets		437,402		442,139		446,822		418,741		399,775
Noninterest-bearing deposits		98,546		104,472		103,708		85,918		80,626
Interest-bearing liabilities:
Interest-bearing deposits		235,092		237,847		240,957		235,013		228,726
Borrowings		6,306		5,272		5,196		5,187		4,000
Total interest-bearing liabilities		241,398		243,119		246,153		240,200		232,726
Common shareholders' equity		90,441		86,549		85,683		81,584		78,640
Tangible common equity (1)		70,939		66,877		65,843		61,587		58,506
Interest income/expense:
Loans	$	5,623	$	4,571	$	4,759	$	4,686	$	4,442
Available-for-sale securities		89		77		75		66		50
Interest-bearing balances and other		42		53		67		33		35
Total interest income		5,754		4,701		4,901		4,785		4,527
Deposits		522		566		645		665		704
Borrowings		9		1		-		-		-
Total interest expense		531		567		645		665		704
Net interest income	$	5,223	$	4,134	$	4,256	$	4,120	$	3,823
(1) See reconciliation of non-GAAP financial measures.

	Three Months Ended
	3/31/22		12/31/21		9/30/21		6/30/21		3/31/21
Average yields and costs:
Loans	7.74	%	6.53	%	6.92	%	6.43	%	6.24	%
Available-for-sale securities	1.69	%	1.51	%	1.55	%	1.47	%	1.25	%
Interest-bearing balances and other	0.30	%	0.24	%	0.28	%	0.28	%	0.39	%
Total interest-earning assets	6.27	%	4.86	%	5.04	%	5.38	%	5.39	%
Interest-bearing deposits	0.90	%	0.94	%	1.06	%	1.13	%	1.25	%
Borrowings	0.58	%	0.08	%	0.00	%	0.00	%	0.00	%
Total interest-bearing liabilities	0.89	%	0.93	%	1.04	%	1.11	%	1.23	%
Cost of funds	0.63	%	0.65	%	0.73	%	0.82	%	0.91	%
Net interest margin	5.69	%	4.27	%	4.37	%	4.63	%	4.55	%

NONINTEREST INCOME
Noninterest income for the three months ended March 31, 2022, was $10.8 million, a decrease of $2.3 million or 18% as compared to the three months ended March 31, 2021. Specific items to note include:

• Windsor Advantage, LLC (“Windsor”), a subsidiary of the Company which offers an SBA and USDA loan servicing platform, had processing and servicing revenue totaling $2.2 million, a decrease of $6.6 million or 75% as compared to the $8.8 million in income earned during the same prior year period. The decrease is attributable to $6.8 million in PPP fee related income realized in Q1 of 2021 compared to no such income in the same period in 2022.
• Mortgage revenue totaled $173,000, a decrease of $1.5 million or 84% as compared to the first quarter of 2021.   Of that decrease, $776,000 is attributable to the change in valuation on the portfolio of mortgage rate lock commitments. That valuation adjustment takes into account the prior quarters average gain percentage on the portfolio and the size of the already closed held for sale mortgage portfolio and the rate locks on committed mortgage loans at quarter end. With rising rates and a general slowdown in mortgage business, the valuation adjustment shifted from a positive impact of $167,000 in the first quarter of 2021 to a negative impact of $609,000 in the first quarter of 2022. Excluding that valuation adjustment, the realized premiums and other core business income of the mortgage department also declined $756,000 from $1.5 million in the first quarter of 2021 to $782,000 for the same period in 2022. Mortgage loans originated to sell to the secondary market decreased from $39.4 million in the first quarter 2021 to $22.4 million in the first quarter 2022.   The decrease in both the core mortgage revenue and origination volume can be attributable to the nationwide slowdown in refinancing volume with housing supplies continuing to be an issue along with the impact of a nationwide increase of almost 20% for the median price of a new home and an almost doubling of long-term mortgage rates year-over-year.  
• Government Guaranteed Lending revenue was $1.1 million in the first quarter of 2022, a decrease of $201,000 or 15% in comparison to the $1.3 million of revenues for the same period in 2021. However, the loans held for sale portfolio, representing future premium income, increased significantly quarter over quarter and year-over-year. GGL related HFS loans were $47.7 million as of March 31, 2022 compared to $25.4 million at December 31, 2021 and $7.9 million at March 31, 2021.
• Other noninterest income was $6.5 million in the first quarter of 2022 compared to income of $2.2 million in the same period in 2021. The increase is almost entirely attributable to a $6.0 million mark-to-market income adjustment on its investment in Dogwood State Bank due to a successful capital raise for Dogwood, which established a new market value. The prior year’s first quarter had a similar mark-to-market of $2.0 million. Excluding the Dogwood investment adjustment, other noninterest income would have been $509,000, up $303,000 or 160% in comparison to the same period in 2021.

NONINTEREST EXPENSE
Noninterest expense for the first quarter of 2022 was $10.4 million, a decrease of $2.3 million or 18%, from $12.7 million for the first quarter of 2021. Contributing to the year-over-year decrease was software expenses, which decreased due to Windsor fully expensing the PPP platform in 2021. Software expenses were $425,000, a decrease of $3.0 million or 87% in the first quarter of 2022 compared to the same period in 2021 as a result of no additional costs related to the processing of PPP loans in the first quarter of 2022. Compensation increased $1.1 million from $6.0 million to $7.1 million due to additional costs for new hires in 2021 and first quarter of 2022. The decreases in most of the noninterest expense categories, including special assets, data processing, software, communications, and other operating expenses are primarily related to management’s overall effort to grow profitability.

ABOUT INTEGRATED FINANCIAL HOLDINGS, INC.
Integrated Financial Holdings, Inc. is a financial holding company based in Raleigh, North Carolina. The Company changed its name from West Town Bancorp, Inc. in the third quarter of 2020. The Company is the holding company for West Town Bank & Trust, an Illinois state-chartered bank. West Town Bank & Trust provides banking services through its full-service office located in the greater Chicago area. The Company is also the parent company of: Windsor Advantage, LLC, a loan servicing company; West Town Insurance Agency, Inc., an insurance agency; Patriarch, LLC, a real estate management company; and SBA Loan Documentation Services, LLC, a loan documentation origination company. The Company is registered with and supervised by the Federal Reserve. West Town Bank & Trust’s primary regulators are the Illinois Department of Financial and Professional Regulation and the FDIC. The Bank also has an investment in West Town Payments, LLC. Due to the nature of the investment, West Town Payments, LLC is considered a variable interest entity, and as a result, is consolidated for accounting purposes.

For more information, visit https://ifhinc.com/.

Important Note Regarding Forward-Looking Statements
This release contains certain forward-looking statements with respect to the financial condition, results of operations, and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of the Company and on the information available to management at the time this release was prepared. These statements can be identified by the use of words such as "expect," "anticipate," "estimate," "believe," variations of these words, and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause a difference include, among others: changes in the national and local economies or market conditions; changes in interest rates, deposit flows, loan demand, and asset quality, including real estate and other collateral values; changes in Small Business Administration rules, regulations, or loan products, including the section 7(a) program; changes in other government guaranteed loan programs or our ability to participate in such programs; changes in tax law, including the impact of such changes on our tax assets and liabilities; future governmental shutdowns that may impact revenues associated with our lending and other operations that are dependent on government guaranteed loan programs; changes in banking regulations and accounting principles, policies, or guidelines; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with the Company’s acquisition and divesture activities; the failure of our strategic investments or acquisitions to perform as anticipated and the impact of any impairments to our intangible assets, such as goodwill; the impact of our strategic initiatives on our ability to retain key employees; adverse results (including judgments, costs, fines, reputational harm, financial settlements and/or other negative effects) from current or future litigation, regulatory proceedings, investigations, or similar matters, or developments related thereto; and the impact of competition from traditional or new sources, including non-bank financial service providers, such as Fintechs. These, and other factors that may emerge, could cause decisions and actual results to differ materially from current expectations. The Company assumes no obligation to revise, update, or clarify forward-looking statements to reflect events or conditions after the date of this release.        

Consolidated Balance Sheets
				Ending Balance
(Dollars in thousands, unaudited)				3/31/22			12/31/21			9/30/21			6/30/21			3/31/21
Assets
Cash and due from banks				$	3,900		$	3,803		$	4,452		$	3,537		$	3,217
Interest-bearing deposits					28,876			79,910			83,327			76,957			30,224
Total cash and cash equivalents					32,776			83,713			87,779			80,494			33,441
Interest-bearing time deposits					1,746			1,746			1,996			2,746			2,746
Available-for-sale securities					20,386			20,659			19,341			18,928			16,215
Marketable equity securities					18,000			12,000			12,000			12,000			12,000
Loans held for sale					51,095			27,880			20,610			14,621			17,735
Loans held for investment					262,281			259,625			259,206			264,402			278,200
Allowance for loan and lease losses					(5,622	)		(5,547	)		(5,810	)		(5,635	)		(5,609	)
Loans held for investment, net					256,659			254,078			253,396			258,767			272,591
Premises and equipment, net					4,235			4,106			4,127			4,599			4,651
Foreclosed assets					-			618			618			618			1,377
Loan servicing assets					4,014			3,993			3,830			3,936			3,428
Bank-owned life insurance					5,271			5,246			5,220			5,193			5,161
Accrued interest receivable					1,886			1,373			1,508			1,672			1,656
Goodwill					13,161			13,161			13,161			13,161			13,161
Other intangible assets, net					6,180			6,400			6,569			6,737			6,851
Other assets					15,218			18,001			13,954			16,803			17,176
Total assets				$	430,627		$	452,974		$	444,109		$	440,275		$	408,189
Liabilities and Shareholders' Equity
Liabilities
Deposits:
Noninterest-bearing				$	92,499		$	114,313		$	98,940		$	98,797		$	77,167
Interest-bearing					233,953			233,842			241,959			238,598			234,523
Total deposits					326,452			348,155			340,899			337,395			311,690
Borrowings					5,000			7,500			5,000			5,000			4,000
Accrued interest payable					325			326			372			388			454
Other liabilities					8,320			9,212			11,130			13,490			11,347
Total liabilities					340,097			365,193			357,401			356,273			327,491
Shareholders' equity:
Common stock, voting					2,213			2,176			2,176			2,183			2,223
Common stock, non-voting					22			22			22			22			22
Additional paid in capital					24,013			23,664			23,515			23,545			24,568
Retained earnings					66,372			62,810			61,534			58,597			54,015
Accumulated other comprehensive income (loss)					(1,296	)		(99	)		65			105			164
Total IFH, Inc. shareholders' equity					91,324			88,573			87,312			84,452			80,992
Noncontrolling interest					(794	)		(792	)		(604	)		(450	)		(294	)
Total shareholders' equity					90,530			87,781			86,708			84,002			80,698
Total liabilities and shareholders' equity				$	430,627		$	452,974		$	444,109		$	440,275		$	408,189

Consolidated Statements of Income
(Dollars in thousands except per	Three Months Ended
share data; unaudited)	3/31/22			12/31/21			9/30/21			6/30/21			3/31/21
Interest income
Loans	$	5,623		$	4,571		$	4,759		$	4,686		$	4,442
Available-for-sale securities and other		131			130			142			99			85
Total interest income		5,754			4,701			4,901			4,785			4,527
Interest expense
Interest on deposits		522			566			645			665			704
Interest on borrowings		9			1			-			-			-
Total interest expense		531			567			645			665			704
Net interest income		5,223			4,134			4,256			4,120			3,823
Provision for loan losses		180			775			500			50			622
Noninterest income
Loan processing and servicing
revenue		2,207			2,863			5,951			5,765			8,838
Mortgage		173			1,090			1,537			1,773			1,706
Government guaranteed lending		1,124			2,216			584			3,812			1,325
SBA documentation preparation fees		144			167			149			241			434
Service charges on deposits		104			85			77			49			32
Bank-owned life insurance		25			25			27			32			25
Other noninterest income (loss)		6,509			(1,473	)		694			908			2,196
Total noninterest income		10,286			4,973			9,019			12,580			14,556
Noninterest expense
Compensation		7,061			6,178			5,462			5,996			6,016
Occupancy and equipment		344			254			324			300			303
Loan and special asset expenses		638			483			133			634			1,002
Professional services		551			845			732			560			680
Data processing		249			267			196			215			221
Software		425			830			842			1,524			3,391
Communications		83			99			100			90			107
Advertising		214			453			474			393			109
Amortization of intangibles		170			170			170			172			186
Other operating expenses		631			754			505			733			644
Total noninterest expense		10,366			10,333			8,938			10,617			12,659
Income (loss) before income taxes		4,963			(2,001	)		3,837			6,033			5,098
Income tax expense (benefit)		1,403			(3,090	)		1,055			1,606			1,296
Net income		3,560			1,089			2,782			4,427			3,802
Noncontrolling interest		(2	)		(187	)		(155	)		(155	)		(134	)
Net income attributable
to IFH, Inc.	$	3,562		$	1,276		$	2,937		$	4,582		$	3,936
Basic earnings per common share	$	1.65		$	0.60		$	1.37		$	2.14		$	1.80
Diluted earnings per common share	$	1.59		$	0.57		$	1.32		$	2.07		$	1.76
Weighted average common shares
outstanding		2,159			2,140			2,144			2,147			2,185
Diluted average common shares
outstanding		2,242			2,234			2,219			2,219			2,240

Performance Ratios
		Three Months Ended
		3/31/22			12/31/21			9/30/21			6/30/21			3/31/21
PER COMMON SHARE
	Basic earnings per common share	$	1.65		$	0.60		$	1.37		$	2.14		$	1.80
	Diluted earnings per common share		1.59			0.57			1.32			2.07			1.76
	Book value per common share		40.86			40.35			39.74			38.32			36.08
	Tangible book value per common share (2)		32.21			31.44			30.76			29.29			27.16
FINANCIAL RATIOS (ANNUALIZED)
	Return on average assets		3.30	%		1.14	%		2.61	%		4.39	%		3.99	%
	Return on average common shareholders'
	equity		15.97	%		5.85	%		13.60	%		22.53	%		20.30	%
	Return on average tangible common
	equity (2)		20.36	%		7.57	%		17.70	%		29.84	%		27.28	%
	Net interest margin		5.69	%		4.27	%		4.37	%		4.63	%		4.55	%
	Efficiency ratio (1)		66.8	%		113.5	%		67.3	%		63.6	%		68.9	%
	(1) Efficiency ratio is calculated by dividing noninterest expense less transaction-related costs by the sum of net interest income and noninterest income, less gains or losses on sale of securities.
	(2) See reconciliation of non-GAAP measures

Loan Concentrations

The top ten commercial loan concentrations as of March 31, 2022, were as follows:

			% of
			Commercial
(in millions)	Amount		Loans
Solar electric power generation	$	54.6	28	%
Power and communication line and related structures construction		41.0	21	%
Lessors of nonresidential buildings (except miniwarehouses)		17.1	9	%
Other activities related to real estate		13.5	7	%
Hotels (except casino hotels) and motels		9.7	5	%
Lessors of residential buildings and dwellings		5.0	3	%
Other heavy and civil engineering construction		4.4	2	%
Lessors of other real estate property		4.1	2	%
All other amusement and recreation industries		2.9	2	%
Amusement arcades		2.6	1	%
	$	154.9	80	%

Reconciliation of Non-GAAP Measures

(In thousands except book value per share)	3/31/22			12/31/21			9/30/21			6/30/21			3/31/21
Tangible book value per common share
Total IFH, Inc. shareholders' equity	$	91,324		$	88,573		$	87,312		$	84,452		$	80,992
Less: Goodwill		13,161			13,161			13,161			13,161			13,161
Less Other intangible assets, net		6,180			6,400			6,569			6,737			6,851
Total tangible common equity	$	71,983		$	69,012		$	67,582		$	64,554		$	60,980
Ending common shares outstanding		2,235			2,198			2,204			2,204			2,245
Tangible book value per common share	$	32.21		$	31.44		$	30.76		$	29.29		$	27.16
	Three Months Ended
(Dollars in thousands)	3/31/22			12/31/21			9/30/21			6/30/21			3/31/21
Return on average tangible common equity
Average IFH, Inc. shareholders' equity	$	90,441		$	86,549		$	85,683		$	81,584		$	78,640
Less: Average goodwill		13,161			13,161			13,161			13,161			13,161
Less Average other intangible assets, net		6,341			6,511			6,679			6,836			6,973
Average tangible common equity	$	70,939		$	66,877		$	65,843		$	61,587		$	58,506
Net income attributable to IFH, Inc.	$	3,562		$	1,276		$	2,937		$	4,582		$	3,936
Return on average tangible common equity		20.36	%		7.57	%		17.70	%		29.84	%		27.28	%

Contact: Eric Bergevin, 252-482-4400

FAQ

What were the financial results for IFHI in Q1 2022?

IFHI reported a net income of $3.6 million or $1.59 per diluted share in Q1 2022.

How did IFHI's loan processing revenue change in Q1 2022?

Loan processing and servicing revenue for IFHI decreased to $2.7 million in Q1 2022 from $8.8 million in Q1 2021.

What is the outlook for IFHI's loan demand?

Management anticipates continued strong loan demand despite challenges in the mortgage market.

What is the return on equity for IFHI in Q1 2022?

The return on average common equity for IFHI decreased to 15.97% in Q1 2022.