JD Bancshares, Inc. Announces Securities Portfolio Repositioning

Rhea-AI Summary

JD Bancshares, Inc. (JDVB) announced the completion of a strategic securities transaction by its subsidiary, JD Bank, involving the sale of $54.7 million of lower-yielding US Treasury securities, resulting in an estimated pre-tax loss of $6.6 million. The net proceeds will be reinvested into higher-yielding earning assets with an expected average yield of approximately 6.67%, aiming to recover the loss in 2.8 years. The Company's strong capital position enabled this proactive portfolio repositioning to potentially generate significant future earnings and mitigate interest rate risk in 2024.

Positive

• Completion of a strategic securities transaction to reposition the investment securities portfolio
• Reinvestment of net proceeds into higher-yielding earning assets with an expected average yield of approximately 6.67%
• Proactive approach to safeguard against potential interest rate risk in 2024

Negative

• Estimated pre-tax loss of $6.6 million from the sale of lower-yielding US Treasury securities

JENNINGS, LA / ACCESSWIRE / November 22, 2023 / JD Bancshares, Inc. (the "Company"), (OTCQX:JDVB), the parent holding company of JD Bank (the "Bank"), announced that the Bank completed a transaction to reposition a portion of its investment securities portfolio.

In November 2023 the Bank initiated a strategic securities transaction by selling approximately $54.7 million of available-for-sale securities consisting entirely of lower-yielding US Treasury securities with an average yield of 1.32% for an estimated pre-tax loss of $6.6 million. The Company expects to deploy the net proceeds into a mix of cash and higher-yielding earning assets with an expected average yield of approximately 6.67%. We estimate that the loss should be earned back in 2.8 years. The strength of our capital position allowed the Company to proactively reposition the securities portfolio, which we anticipate will provide significant future earnings benefit and safeguard against potential interest rate risk as we enter 2024.

About JD Bancshares, Inc.

JD Bancshares, Inc. is the bank holding company of JD Bank, a state-chartered bank headquartered in Jennings, Louisiana. JD Bank has been serving the citizens of south Louisiana since 1947 and offers a variety of personal and commercial lending and deposit products through both physical and digital delivery channels. The Bank also offers both trust and investment services. JD Bank operates through 22 full-service branch offices and two Loan Production/Deposit Production offices located along the Interstate 10/12 corridor from Lake Charles to Mandeville, Louisiana. JD Bancshares, Inc. may be accessed on its website at jdbank.com.

JD Bancshares, Inc. (OTCQX: JDVB) trades on the OTCQX Best Market. Companies meet high financial standards, follow best practice corporate governance, demonstrate compliance with U.S. securities laws, and have a professional third-party sponsor introduction. Investors can find current financial disclosure and Real-Time Level 2 quotes for the Company on otcmarkets.com.

Contact:

Bruce Elder (CEO) 337-246-5399

Paul Brummett (CFO) 337-246-5395

SOURCE: JD Bancshares, Inc.

View source version on accesswire.com:
https://www.accesswire.com/808689/jd-bancshares-inc-announces-securities-portfolio-repositioning

FAQ

What did JD Bancshares, Inc. (JDVB) announce recently?

JD Bancshares, Inc. (JDVB) announced the completion of a strategic securities transaction involving the sale of $54.7 million of lower-yielding US Treasury securities by its subsidiary, JD Bank.

What is the ticker symbol of JD Bancshares, Inc.?

The ticker symbol of JD Bancshares, Inc. is JDVB.

What was the estimated pre-tax loss from the securities sale?

The estimated pre-tax loss from the sale of lower-yielding US Treasury securities was $6.6 million.

How does the Company plan to use the net proceeds from the securities sale?

The net proceeds will be reinvested into higher-yielding earning assets with an expected average yield of approximately 6.67%.

What is the expected timeline to recover the estimated loss from the securities sale?

The Company aims to recover the estimated loss of $6.6 million in 2.8 years.

Why did the Company reposition its securities portfolio?

The Company repositioned its securities portfolio to potentially generate significant future earnings and safeguard against potential interest rate risk in 2024.