Limestone Bancorp Reports Net Income of $4.0 million, or $0.53 per Diluted Share, for the 2nd Quarter of 2022 and $7.6 million, or $1.00 per Diluted Share, for the Six Months Ended June 30, 2022

Rhea-AI Summary

Limestone Bancorp reported strong Q2 2022 results, with net income reaching $4.0 million or $0.53 per share, up from $3.9 million in Q2 2021. Total assets rose to $1.42 billion with a 2.5% loan portfolio growth. Net interest income was $11.7 million, increasing from $10.9 million a year prior, while net interest margin improved to 3.51%. The allowance for loan losses was 1.17% of total loans, and non-interest income saw a rise to $2.3 million for the quarter.

Overall, the company's disciplined approach to banking is yielding positive results amid rising interest rates.

Positive

• Net income increased to $4.0 million for Q2 2022, up 2.6% YoY.
• Loan portfolio grew by $26.5 million, or 2.5%, in Q2 2022.
• Net interest income rose to $11.7 million, compared to $10.9 million in Q2 2021.
• Net interest margin improved to 3.51% from 3.45% YoY.
• Total assets increased to $1.42 billion, a growth of $8.4 million from the previous quarter.
• Non-interest income grew to $2.3 million in Q2 2022, a $121,000 increase YoY.

Negative

• Non-interest expenses rose to $8.2 million, up 3.4% from Q2 2021 due to higher salaries and benefits.
• Loan fee income dropped significantly from $933,000 in Q2 2021 to only $173,000 in Q2 2022.

LOUISVILLE, Ky.--(BUSINESS WIRE)-- Limestone Bancorp, Inc. (NASDAQ: LMST) (the “Company”), parent company of Limestone Bank, Inc. (the “Bank”), today reported unaudited results for the second quarter of 2022. Net income available to common shareholders for the second quarter of 2022 was $4.0 million, or $0.53 per basic and diluted common share, compared with $3.9 million, or $0.51 per basic and diluted common share, for the second quarter of 2021. Net income for the six months ended June 30, 2022, was $7.6 million, or $1.00 per basic and diluted common share, compared with net income of $7.1 million, or $0.94 per basic and diluted common share, for the six months ended June 30, 2021.

John T. Taylor, Chief Executive Officer, noted, “We continue to be pleased with the Company’s strong financial performance and remain focused on our disciplined approach to community banking and credit underwriting. Our efforts are proving successful as loan growth was 2.5% for the second quarter of 2022 after posting an increase of 4.5% in the first quarter. Asset quality remains strong and net interest margin expanded nine basis points quarter over quarter, which is directionally consistent with the Fed’s tightening actions and our approach to interest rate risk management. I also want to commend our associates for their commitment to the Bank and I am proud to report that Limestone was again, in 2022, named one of the Best Places to Work in Kentucky.”

Total assets were $1.42 billion at June 30, 2022, up $8.4 million from the previous quarter. The loan portfolio increased $26.5 million, or 2.5%, during the quarter to $1.07 billion at June 30, 2022, while securities and fed funds sold declined $16.3 million.

Net Interest Income and Average Earning Assets – Net interest income increased to $11.7 million for the second quarter of 2022, compared to $11.1 million for the first quarter of 2022, and $10.9 million for the second quarter of 2021. Net interest margin increased to 3.51% for the second quarter of 2022, compared with 3.42% for the first quarter of 2022, and 3.45% for the second quarter of 2021.

The yield on earning assets increased to 3.95% in the second quarter of 2022, compared to 3.82% in the first quarter of 2022, and 3.91% in the second quarter of 2021. Quarter over quarter, average loans increased $24.5 million to $1.05 billion, while average lower yielding fed funds sold decreased $8.3 million. PPP loans averaged $172,000 for the second quarter of 2022 and $605,000 for the first quarter of 2022. Compared to the prior year second quarter, average loans increased $91.1 million and average investment securities increased $31.1 million, while average lower yielding fed funds sold decreased $57.4 million. PPP loans averaged $26.9 million for the second quarter of 2021.

While the Federal Reserve increased the fed funds target by 25 basis points on March 16, 2022, 50 basis points on May 4, 2022, and 75 basis points on June 15, 2022, the yield on earning assets for fiscal year 2021 and the first quarter of 2022 were impacted by the low interest rate environment. During the second quarter of 2022, the Bank’s fed funds sold, floating rate investment securities, loans with variable rate pricing features, and new loan originations began to benefit from the upward movement in short-term rates and are expected to continue to benefit as rates continue to rise. The cost of interest-bearing liabilities was also impacted to a lesser extent, but is also expected to increase as short-term interest rates continue to rise.

Loan fee income can meaningfully impact net interest income, loan yields, and net interest margin. The amount of loan fee income included in total interest income was $173,000, $324,000, and $933,000 for the quarters ended June 30, 2022, March 31, 2022, and June 30, 2021, respectively. This represents six basis points, 10 basis points, and 29 basis points of yield on earning assets and net interest margin for the quarters ended June 30, 2022, March 31, 2022, and June 30, 2021, respectively. Loan fee income for the second quarter of 2022 did not include any fees earned on PPP loans, compared to $45,000 in the first quarter of 2022, and $692,000 in the second quarter of 2021, which represents two basis points, and 22 basis points of earning asset yield and net interest margin for those quarters, respectively.

The following table reconciles the as reported yield on earning assets to the yield on earning assets excluding PPP fees, a non-GAAP financial measure:

	Three Months Ended
		6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
	(in thousands)
Yield on Earning Assets, as reported		3.95	%		3.82	%		3.71	%		4.03	%		3.91	%
Less Impact of PPP Fees		—			0.02			0.08			0.43			0.22
Yield on Earning Asset excluding PPP Fees		3.95	%		3.80	%		3.63	%		3.60	%		3.69	%

The cost of interest-bearing liabilities was 0.58% for the second quarter of 2022, compared to 0.53% in the first quarter of 2022, and 0.61% in the second quarter of 2021. Quarter over quarter, average deposits decreased and were replaced with higher cost FHLB funding. Compared to the prior year second quarter, the cost of interest-bearing liabilities benefitted as a result of an improvement in deposit mix, as well as the downward repricing of time deposits between periods.

Net interest income increased to $22.8 million for the first six months of 2022, compared with $21.6 million in the first six months of 2021. Net interest margin decreased to 3.47% in the first six months of 2022, compared with 3.49% for the first six months of 2021.

The yield on earning assets decreased to 3.88% for the first six months of 2022, compared to 3.98% for the first six months of 2021. Average loans for the first six months of 2022 increased $77.7 million to $1.04 billion and average investment securities increased $42.6 million, while average lower yielding fed funds sold decreased $39.9 million compared to the first six months of 2021. Average PPP loans were $419,000 and $23.5 million for the first six months of 2022 and 2021, respectively. The amount of loan fee income included in total interest income was $497,000 and $1.8 million for the six months ended June 30, 2022 and 2021, respectively. This represents seven basis points and 29 basis points of yield on earning assets and net interest margin for the six months ended June 30, 2022 and 2021, respectively. Loan fee income included PPP fees of $45,000 and $1.1 million for the six months ended June 30, 2022 and 2021, respectively, which represented less than one basis point and 18 basis points of earning asset yield and net interest margin for those six-month periods, respectively.

The cost of interest-bearing liabilities was 0.56% for the first six months of 2022, compared to 0.64% in the first six months of 2021. The cost of interest-bearing liabilities for the first six months of 2022 benefitted from an improvement in deposit mix, as well as the downward repricing of time deposits between periods compared to the first six months of 2021.

The cost of interest-bearing liabilities was impacted by the recent increases in short-term interest rates and is expected to continue to increase as short-term interest rates continue to rise. Time deposits declined $3.9 million during the second quarter of 2022 as approximately $59.4 million of time deposits with an average rate of 0.29% matured and were redeemed or repriced at lower interest rates. During the second quarter of 2022, newly originated or renewed time deposits had an average rate of 0.75% and an average term of approximately 10 months. As of June 30, 2022, time deposits comprised $256.1 million of the Company’s liabilities including $47.9 million with a current average rate of 0.58%, which reprice or mature in the third quarter of 2022. The following table denotes contractual time deposit maturities and average rates as of June 30, 2022:

Maturity Quarter		As of June 30, 2022 (in thousands)			Weighted Average Rate
Q3-2022			47,894		0.58
Q4-2022			51,494		0.55
Q1-2023			52,568		0.50
Q2-2023			26,461		0.74
Thereafter			77,724		0.79
Total time deposits		$	256,141		0.64	%

Provision and Allowance for Loan Losses – The allowance for loan losses to total loans was 1.17% at June 30, 2022, compared to 1.16% at March 31, 2022, and 1.33% at June 30, 2021.

Net loan charge-offs were $95,000 and $181,000, for the three and six months ended June 30, 2022, compared to net loan charge-offs of $118,000 and $156,000, for the three and six months ended June 30, 2021. A provision for loan loss of $450,000 and $1.2 million, or $0.04 and $0.12 per common share after taxes, was recorded in the second quarter and the first six months of 2022, respectively, compared to no provision for loan loss in the second quarter of 2021 and $350,000, or $0.03 per common share after taxes, for the first six months of 2021. The 2022 and 2021 loan loss provisions were attributable to growth trends within the portfolio and net loan charge-offs impacting historical loss percentages during the periods.

Non-interest Income and Expense – Non-interest income for the second quarter of 2022 increased $121,000 to $2.3 million, compared with $2.1 million for the second quarter of 2021. The increase was primarily related to an increase in transaction volumes which led to an increase in service charges on deposit accounts of $170,000 and an increase in bank owned life insurance income of $106,000 due to additional policies being purchased in March 2022, offset by a non-recurring $191,000 gain on the sale of OREO from the second quarter of 2021. Non-interest expense increased $273,000, or 3.4%, to $8.2 million for the second quarter of 2022, compared with $8.0 million for the second quarter of 2021. Salaries and benefits expense increased $184,000 from the second quarter of 2021. While FTEs declined between the periods, salaries expense increased as a result of the inflationary impact on talent acquisition and the administration of annual salary adjustments.

Non-interest income for the first six months of 2022 increased $475,000 to $4.5 million, compared with $4.0 million for the first six months of 2021. The increase was primarily due to an increase in service charges on deposit accounts of $256,000 and $143,000 in bank owned life insurance income as discussed above. Non-interest income for the first six months of 2022 also included a $163,000 non-recurring gain on sale of premises held for sale from the first quarter of 2022, while the first six months of 2021 included a $191,000 non-recurring gain on sale of OREO from the second quarter of 2021. Non-interest expense increased $260,000, or 1.6%, to $16.2 million for the first six months of 2022, compared with $15.9 million for the first six months of 2021. The increase was primarily due to an increase of $266,000 in salaries and benefits as discussed above.

About Limestone Bancorp, Inc.
Limestone Bancorp, Inc. (NASDAQ: LMST) is a Louisville, Kentucky-based bank holding company which operates banking centers in 14 counties through its wholly-owned subsidiary Limestone Bank. The Bank’s markets include metropolitan Louisville in Jefferson County and the surrounding counties of Bullitt and Henry and extend south along the Interstate 65 corridor. The Bank serves south central, southern, and western Kentucky from banking centers in Barren, Butler, Daviess, Edmonson, Green, Hardin, Hart, Ohio, and Warren counties. The Bank also has banking centers in Lexington, Kentucky, the second largest city in the state, and Frankfort, Kentucky, the state capital. Limestone Bank is a traditional community bank with a wide range of personal and business banking products and services.

Forward-Looking Statements
Statements in this press release relating to Limestone Bancorp’s plans, objectives, expectations or future performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “may,” “should,” “anticipate,” “estimate,” “expect,” “intend,” “objective,” “possible,” “seek,” “plan,” “strive” or similar words, or negatives of these words, identify forward-looking statements that involve risks and uncertainties. Although the Company's management believes the assumptions underlying the forward-looking statements contained herein are reasonable, any of these assumptions could be inaccurate. Therefore, there can be no assurance the forward-looking statements included herein will prove to be accurate. Factors that could cause actual results to differ from those discussed in forward-looking statements include, but are not limited to: the impact and duration of the COVID-19 pandemic; economic conditions both generally and more specifically in the markets in which the Company and its subsidiaries operate; competition for the Company's customers from other providers of financial services; government legislation and regulation, which change from time to time and over which the Company has no control; changes in inflation and efforts to control it; changes in interest rates; material unforeseen changes in liquidity, results of operations, or financial condition of the Company's customers; and other risks detailed in the Company's filings with the Securities and Exchange Commission, all of which are difficult to predict and many of which are beyond the control of the Company. See Risk Factors outlined in the Company's Form 10-K for the year ended December 31, 2021.

Additional Information
Unaudited supplemental financial information for the second quarter ending June 30, 2022, follows.

LIMESTONE BANCORP, INC. Unaudited Financial Information (in thousands, except share and per share data)
	Three			Three			Six			Six
	Months			Months			Months			Months
	Ended			Ended			Ended			Ended
	6/30/22			6/30/21			6/30/22			6/30/21
Income Statement Data
Interest income	$	13,122		$	12,376		$	25,549		$	24,626
Interest expense		1,442			1,462			2,755			3,032
Net interest income		11,680			10,914			22,794			21,594
Provision for loan losses		450			—			1,200			350
Net interest income after provision		11,230			10,914			21,594			21,244
Service charges on deposit accounts		690			520			1,324			1,068
Bank card interchange fees		1,087			1,073			2,090			2,033
Bank owned life insurance income		249			143			451			308
Gain on sale of OREO		—			191			—			191
Gain (loss) on sales and calls of securities, net		(3	)		(5	)		(3	)		(5	)
Gain on sale of premises held for sale		—			—			163			—
Other		233			213			469			424
Non-interest income		2,256			2,135			4,494			4,019
Salaries & employee benefits		4,651			4,467			9,215			8,949
Occupancy and equipment		1,055			979			2,084			2,039
Deposit account related expense		574			556			1,121			1,047
Data processing expense		403			377			789			755
Professional fees		236			246			457			482
Marketing expense		172			179			305			361
FDIC insurance		90			90			180			225
Deposit tax		99			90			198			180
Communications expense		121			194			185			367
Insurance expense		109			115			214			219
Postage and delivery		150			139			313			291
Other		567			522			1,137			1,023
Non-interest expense		8,227			7,954			16,198			15,938
Income before income taxes		5,259			5,095			9,890			9,325
Income tax expense		1,223			1,194			2,275			2,202
Net income	$	4,036		$	3,901		$	7,615		$	7,123
Weighted average shares – Basic		7,631,883			7,597,202			7,623,181			7,586,267
Weighted average shares – Diluted		7,631,883			7,597,202			7,623,181			7,586,267
Basic earnings per common share	$	0.53		$	0.51		$	1.00		$	0.94
Diluted earnings per common share	$	0.53		$	0.51		$	1.00		$	0.94
Cash dividends declared per common share	$	0.05		$	0.00		$	0.10		$	0.00
Performance Ratios
Return on average assets		1.14	%		1.15	%		1.09	%		1.07	%
Return on average equity		12.66			12.89			11.86			12.02
Yield on average earning assets (tax equivalent)		3.95			3.91			3.88			3.98
Cost of interest-bearing liabilities		0.58			0.61			0.56			0.64
Net interest margin (tax equivalent)		3.51			3.45			3.47			3.49
Efficiency ratio1		59.02			60.93			59.35			62.21
Non-interest expense to average assets		2.33			2.34			2.31			2.40

LIMESTONE BANCORP, INC. Unaudited Financial Information (in thousands, except share and per share data)
		Three		Three			Three				Three			Three
		Months		Months			Months				Months			Months
		Ended		Ended			Ended				Ended			Ended
		6/30/22		3/31/22			12/31/21				9/30/21			6/30/21
Income Statement Data
Interest income	$	13,122		$	12,427		$	12,314		$	12,975		$	12,376
Interest expense		1,442			1,313			1,307			1,354			1,462
Net interest income		11,680			11,114			11,007			11,621			10,914
Provision for loan losses		450			750			500			300			—
Net interest income after provision		11,230			10,364			10,507			11,321			10,914
Service charges on deposit accounts		690			634			605			583			520
Bank card interchange fees		1,087			1,003			1,039			1,044			1,073
Bank owned life insurance income		249			202			106			112			143
Gain on sale of OREO		—			—			—			—			191
Gain (loss) on sales and calls of securities, net		(3	)		—			—			465			(5	)
Gain on sale of premises held for sale		—			163			—			—			—
Other		233			236			234			232			213
Non-interest income		2,256			2,238			1,984			2,436			2,135
Salaries & employee benefits		4,651			4,564			4,601			4,582			4,467
Occupancy and equipment		1,055			1,029			978			1,024			979
Deposit account related expense		574			547			566			545			556
Data processing expense		403			386			379			378			377
Professional fees		236			221			251			219			246
Marketing expense		172			133			166			200			179
FDIC insurance		90			90			90			90			90
Deposit tax		99			99			105			90			90
Communications expense		121			64			161			153			194
Insurance expense		109			105			91			105			115
Postage and delivery		150			163			145			169			139
Other		567			570			450			495			522
Non-interest expense		8,227			7,971			7,983			8,050			7,954
Income before income taxes		5,259			4,631			4,508			5,707			5,095
Income tax expense		1,223			1,052			1,063			1,366			1,194
Net income	$	4,036		$	3,579		$	3,445		$	4,341		$	3,901
Weighted average shares – Basic		7,631,883			7,614,382			7,597,256			7,602,686			7,597,202
Weighted average shares – Diluted		7,631,883			7,614,382			7,597,256			7,602,686			7,597,202
Basic earnings per common share	$	0.53		$	0.47		$	0.45		$	0.57		$	0.51
Diluted earnings per common share	$	0.53		$	0.47		$	0.45		$	0.57		$	0.51
Cash dividends declared per common share	$	0.05		$	0.05		$	0.00		$	0.00		$	0.00
Performance Ratios
Return on average assets		1.14	%		1.03	%		0.97	%		1.26	%		1.15	%
Return on average equity		12.66			11.07			10.51			13.61			12.89
Yield on average earning assets (tax equivalent)		3.95			3.82			3.71			4.03			3.91
Cost of interest-bearing liabilities		0.58			0.53			0.53			0.56			0.61
Net interest margin (tax equivalent)		3.51			3.42			3.32			3.61			3.45
Efficiency ratio1		59.02			59.70			61.45			59.23			60.93
Non-interest expense to average assets		2.33			2.30			2.25			2.33			2.34

LIMESTONE BANCORP, INC. Unaudited Financial Information (in thousands, except share and per share data)
	As of
	6/30/22				3/31/22				12/31/21				9/30/21			6/30/21
Assets
Loans	$	1,073,815			$	1,047,285			$	1,001,840			$	968,088		$	947,425
Allowance for loan losses		(12,550	)			(12,195	)			(11,531	)			(12,973	)		(12,637	)
Net loans		1,061,265				1,035,090				990,309				955,115			934,788
Securities held to maturity2		44,205				45,639				46,460				47,539			46,717
Securities available for sale2		193,022				204,071				214,213				203,548			182,154
Federal funds sold & interest-bearing deposits		18,244				22,040				67,110				44,909			75,536
Cash and due from financial institutions		7,742				10,009				10,493				13,579			9,584
Premises and equipment		22,747				23,043				21,575				21,623			21,912
Premises held for sale		—				—				310				980			980
Bank owned life insurance		30,888				30,643				23,946				23,845			23,738
FHLB Stock		5,116				5,116				5,116				5,116			5,449
Deferred taxes, net		23,343				22,648				21,583				22,161			23,452
Goodwill		6,252				6,252				6,252				6,252			6,252
Intangible assets		1,861				1,925				1,989				2,053			2,117
Accrued interest receivable and other assets		6,383				6,230				6,336				6,128			6,231
Total Assets	$	1,421,068			$	1,412,706			$	1,415,692			$	1,352,848		$	1,338,910
Liabilities and Equity
Certificates of deposit	$	256,141			$	260,064			$	266,011			$	280,545		$	303,668
Interest checking		269,240				274,054				287,208				239,923			216,344
Money market		209,183				216,845				217,943				198,470			191,773
Savings		163,573				166,135				163,423				163,018			160,257
Total interest-bearing deposits		898,137				917,098				934,585				881,956			872,042
Demand deposits		269,425				281,533				274,083				266,035			267,059
Total deposits		1,167,562				1,198,631				1,208,668				1,147,991			1,139,101
FHLB advances		70,000				30,000				20,000				20,000			20,000
Junior subordinated debentures		21,000				21,000				21,000				21,000			21,000
Subordinated capital note		25,000				25,000				25,000				25,000			25,000
Accrued interest payable and other liabilities		10,888				9,855				10,065				10,193			9,850
Total liabilities		1,294,450				1,284,486				1,284,733				1,224,184			1,214,951
Total stockholders’ equity		126,618				128,220				130,959				128,664			123,959
Total Liabilities and Stockholders’ Equity	$	1,421,068			$	1,412,706			$	1,415,692			$	1,352,848		$	1,338,910
Ending shares outstanding		7,640,680				7,622,157				7,594,749				7,602,686			7,602,686
Book value per common share	$	16.57			$	16.82			$	17.24			$	16.92		$	16.30
Tangible book value per common share3		15.51				15.75				16.16				15.83			15.20

LIMESTONE BANCORP, INC. Unaudited Financial Information (in thousands, except share and per share data)
		As of
		6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
Average Balance Sheet Data
Assets	$	1,417,087		$	1,407,030		$	1,405,219		$	1,369,372		$	1,361,080
Loans		1,053,057			1,028,546			955,516			952,567			961,922
Earning assets		1,339,555			1,326,234			1,322,821			1,284,188			1,275,363
Deposits		1,184,426			1,199,174			1,199,334			1,166,785			1,164,524
Long-term debt and advances		93,968			67,667			66,000			66,000			66,000
Interest bearing liabilities		1,000,367			996,710			982,132			954,007			956,172
Stockholders’ equity		127,827			131,097			129,998			126,556			121,386
Asset Quality Data
Nonaccrual loans	$	3,007		$	3,447		$	3,124		$	1,627		$	1,530
Troubled debt restructurings on accrual		150			333			340			561			390
Loan 90 days or more past due still on accrual		—			—			—			—			—
Total non-performing loans		3,157			3,780			3,464			2,188			1,920
Real estate acquired through foreclosures		—			—			—			—			—
Other repossessed assets		—			—			—			—			—
Total non-performing assets	$	3,157		$	3,780		$	3,464		$	2,188		$	1,920
Non-performing loans to total loans		0.29	%		0.36	%		0.35	%		0.23	%		0.20	%
Non-performing assets to total assets		0.22			0.27			0.24			0.16			0.14
Allowance for loan losses to non-performing loans		397.53			322.62			332.88			592.92			658.18
Allowance for loan losses to total loans		1.17	%		1.16	%		1.15	%		1.34	%		1.33	%
Loan Charge-off Data
Loans charged off	$	(367	)	$	(227	)	$	(2,246	)	$	(25	)	$	(178	)
Recoveries		272			141			304			61			60
Net (charge-offs) recoveries	$	(95	)	$	(86	)	$	(1,942	)	$	36		$	(118	)
Loans by Risk Category4
Pass	$	1,052,624		$	1,023,039		$	977,962		$	945,396		$	913,753
Watch		6,426			8,567			7,856			3,407			15,888
Special Mention		—			—			—			—			—
Substandard		14,765			15,679			16,022			19,285			17,784
Doubtful		—			—			—			—			—
Total	$	1,073,815		$	1,047,285		$	1,001,840		$	968,088		$	947,425
Loans by Past Due Status
Past due loans:
30 – 59 days	$	600		$	1,108		$	556		$	630		$	181
60 – 89 days		209			89			210			142			252
90 days or more		—			—			—			—			—
Nonaccrual loans		3,007			3,447			3,124			1,627			1,530
Total past due and nonaccrual loans	$	3,816		$	4,644		$	3,890		$	2,399		$	1,963

LIMESTONE BANCORP, INC. Unaudited Financial Information (in thousands, except share and per share data)
		As of
		6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
Risk-based Capital Ratios - Company
Tier I leverage ratio		9.68	%		9.38	%		9.14	%		9.39	%		8.70	%
Common equity Tier I risk-based capital ratio		9.16			8.93			9.00			9.37			9.48
Tier I risk-based capital ratio		10.49			10.19			10.38			10.86			10.63
Total risk-based capital ratio		13.39			13.12			13.41			14.13			14.09
Risk-based Capital Ratios – Limestone Bank
Tier I leverage ratio		11.39	%		11.20	%		10.84	%		10.96	%		10.55	%
Common equity Tier I risk-based capital ratio		12.38			12.21			12.35			12.68			12.95
Tier I risk-based capital ratio		12.38			12.21			12.35			12.68			12.95
Total risk-based capital ratio		13.35			13.17			13.31			13.80			14.11
FTE employees, end of period		225			222			227			232			231

Footnotes:

(1) The efficiency ratio is a non-GAAP measure of expense control relative to revenue from net interest income and fee income. The efficiency ratio is calculated by dividing total non-interest expenses as determined under GAAP by net interest income and total non-interest income, but excluding from the calculation net gains on the sale of securities and expenses disclosed from time to time as non-recurring in nature. Management believes this provides a reasonable measure of primary banking expenses relative to primary banking revenue.

	Three Months Ended
	6/30/22				3/31/22				12/31/21				9/30/21				6/30/21
Efficiency Ratio	(in thousands)
Net interest income	$	11,680			$	11,114			$	11,007			$	11,621			$	10,914
Non-interest income		2,256				2,238				1,984				2,436				2,135
Less: Net gain (loss) on securities		(3	)			—				—				465				(5	)
Revenue used for efficiency ratio		13,939				13,352				12,991				13,592				13,054
Non-interest expense		8,227				7,971				7,983				8,050				7,954
Efficiency ratio		59.02	%			59.70	%			61.45	%			59.23	%			60.93	%
	Six Months Ended
	6/30/22				6/30/21
	(in thousands)
Efficiency Ratio
Net interest income	$	22,794			$	21,594
Non-interest income		4,494				4,019
Less: Net gain (loss) on securities		(3	)			(5	)
Revenue used for efficiency ratio		27,291				25,618
Non-interest expense		16,198				15,938
Efficiency ratio		59.35	%			62.21	%

(2) Investment Securities – The following table sets forth the amortized cost and fair value of our securities portfolio at the dates indicated.

		June 30, 2022																March 31, 2022
		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Fair Value				Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Fair Value
		(dollars in thousands)
Securities available for sale
U.S. Government and federal agencies		$	26,438			$	—			$	(2,062	)		$	24,376			$	26,952			$	—			$	(1,196	)		$	25,756
Agency mortgage-backed residential			87,182				42				(8,864	)			78,360				90,589				177				(5,097	)			85,669
Collateralized loan obligations			48,216				—				(2,038	)			46,178				48,221				—				(297	)			47,924
Corporate bonds			45,473				16				(1,381	)			44,108				45,453				221				(952	)			44,722
Total available for sale		$	207,309			$	58			$	(14,345	)		$	193,022			$	211,215			$	398			$	(7,542	)		$	204,071
		Amortized Cost				Gross Unrecognized Gains				Gross Unrecognized Losses				Fair Value				Amortized Cost				Gross Unrecognized Gains				Gross Unrecognized Losses				Fair Value
		(dollars in thousands)
Securities held to maturity
State and municipal		$	44,205			$	3			$	(7,985	)		$	36,223			$	45,639			$	24			$	(4,873	)		$	40,790
Total held to maturity		$	44,205			$	3			$	(7,985	)		$	36,223			$	45,639			$	24			$	(4,873	)		$	40,790

(3) Tangible book value per common share is a non-GAAP financial measure derived from GAAP based amounts. Tangible book value per common share is calculated by excluding the balance of goodwill and other intangible assets from common stockholders’ equity. Tangible book value per common share is calculated by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which is calculated by dividing common stockholders’ equity by common shares outstanding. Management believes this is consistent with bank regulatory agency treatment, which excludes goodwill and other intangible assets from the calculation of risk-based capital.

		As of
		6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
Tangible Book Value Per Share	(in thousands, except share and per share data)
Common stockholders’ equity	$	126,618		$	128,220		$	130,959		$	128,664		$	123,959
Less: Goodwill		6,252			6,252			6,252			6,252			6,252
Less: Intangible assets		1,861			1,925			1,989			2,053			2,117
Tangible common equity		118,505			120,043			122,718			120,359			115,590
Shares outstanding		7,640,680			7,622,157			7,594,749			7,602,686			7,602,686
Tangible book value per common share	$	15.51		$	15.75		$	16.16		$	15.83		$	15.20
Book value per common share		16.57			16.82			17.24			16.92			16.30

(4) Loans by Risk Category reflect management’s risk ratings based on categories aligned with the bank regulatory definitions.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220720005073/en/

John T. Taylor

Chief Executive Officer

(502) 499-4800

Source: Limestone Bancorp, Inc.

FAQ

What were the financial results for Limestone Bancorp in Q2 2022?

Limestone Bancorp reported a net income of $4.0 million, or $0.53 per share, for Q2 2022.

How much did Limestone Bancorp's loan portfolio grow in Q2 2022?

The loan portfolio grew by $26.5 million, or 2.5%, in Q2 2022.

What is Limestone Bancorp's net interest margin for Q2 2022?

The net interest margin for Q2 2022 improved to 3.51%.

How did non-interest income change for Limestone Bancorp in Q2 2022?

Non-interest income increased to $2.3 million in Q2 2022, a rise of $121,000 from the previous year.

What are the key financial highlights for Limestone Bancorp in the first half of 2022?

For the first half of 2022, net income was $7.6 million, up from $7.1 million in 2021.