LINKBANCORP, Inc. Announces Fourth Quarter 2022 and Full Year 2022 Financial Results and Declares Dividend

Rhea-AI Summary

LINKBANCORP, Inc. (NASDAQ: LNKB) reported a net income of $696 thousand, or $0.05 per diluted share, for Q4 and $5.6 million, or $0.49 per diluted share, for the year ending December 31, 2022. Adjusted earnings for Q4 were $1.47 million, excluding merger expenses. The Board declared a quarterly cash dividend of $0.075 per share. Key highlights include a 30% annualized growth in net loans, a 49% increase in noninterest-bearing deposits, and a net interest margin of 3.36%. Total assets grew to $1.164 billion, with strong asset quality and capital ratios exceeding regulatory requirements.

Positive

• Net loans increased by $63.8 million in Q4, showing nearly 30% annualized growth.
• Noninterest-bearing deposits rose by 17% annualized in Q4 and 49% year-over-year.
• Net interest income grew to $9.0 million, a 14% annualized increase.
• Shareholders' equity increased to $138.6 million at year-end, driven by IPO proceeds.

Negative

• Noninterest income dropped to $508 thousand in Q4 from $1 million in Q3 due to decreased SBA loan sales.
• Noninterest expense increased to $8.4 million in Q4, partly due to core system conversion costs.

HARRISBURG, Pa., Feb. 2, 2023 /PRNewswire/ -- LINKBANCORP, Inc. (NASDAQ:  LNKB) (the "Company"), the parent company of LINKBANK (the "Bank") reported net income of $696 thousand, or $0.05 per diluted share, for the quarter ended December 31, 2022 and $5.6 million, or $0.49 per diluted share, for the year ended December 31, 2022. Excluding merger and system conversion related expenses of $973 thousand, adjusted earnings were $1.47 million¹, or $0.10¹ per diluted share for the fourth quarter of 2022 and $6.36 million¹, or $0.56¹ per diluted share, for the full year ended December 31, 2022.

Additionally, the Company announced that the Board of Directors declared a quarterly cash dividend of $0.075 per share of common stock which is expected to be paid on March 15, 2023 to shareholders of record on February 28, 2023.

Fourth Quarter 2022 Highlights

• The Company successfully completed a transformational migration to an open and scalable core technology platform, enabling implementation of innovative, best-of-class solutions and improved data analytics.
• Net loans grew $63.8 million during the fourth quarter and $211.5 million for the year, each representing a nearly 30% annualized growth rate.
• Noninterest bearing deposits grew $7.9 million, or 17% annualized, for the quarter and $63.5 million, or 49% over the prior year end.
• Net interest income increased $315 thousand to $9.0 million, a 14% annualized increase over the prior quarter. Net interest margin was 3.36% for the fourth quarter of 2022, compared to 3.27% in the fourth quarter of 2021.

__________________________

1 See Appendix A — Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP measure.

Andrew Samuel, Chief Executive Officer, commented, "We are very pleased by the many accomplishments our team achieved in 2022 to positively impact the lives of our employees, clients, communities and shareholders, including tremendous balance sheet and revenue growth, expansion of our presence in the Delaware Valley Region, a successful core technology conversion, and successful initial public offering and Nasdaq listing, all while remaining disciplined to maintain strong credit quality and operational excellence as we navigate an uncertain national economy." He continued, "We believe we have built a strong foundation with a solid and scalable infrastructure and talented community bankers that positions our Company for continued and even greater success in this new year."  

Income Statement
Net interest income before the provision for loan losses for the fourth quarter of 2022 increased to $9.0 million compared to $8.7 million in the third quarter of 2022. Net interest margin was 3.36% for the fourth quarter of 2022 compared to 3.51% for the third quarter of 2022.  The decrease in net interest margin was the result of a 47 basis points increase in cost of funds due to increased deposit costs and borrowings, partially offset by a 29 basis points increase in the average yield on interest-earning assets. The increase in the average yield on interest-earning assets was primarily due to the increase of the average yield on loans of 37 basis points, to 4.90% during the fourth quarter of 2022.

Noninterest income decreased from $1.0 million in the third quarter of 2022 to $508 thousand in the fourth quarter of 2022, resulting from a decline in gain on sale of loans due to a decreased volume in Small Business Administration ("SBA") loans. Noninterest expense for the fourth quarter of 2022 increased to $8.4 million compared to $7.0 million for the third quarter of 2022. The increase included $973 thousand in nonrecurring charges relating to the core system conversion as well as the accrual of accelerated retirement benefits resulting from the merger with GNB Financial. Increased salary and employee benefits expenses included a $112 thousand additional paid-time-off (PTO) accrual expense in connection with the core system conversion, as well as an increased incentive compensation accrual due to conversion-related bonuses and the achievement of year end performance objectives. 

For the year ended December 31, 2022, net interest income before provision for loan losses increased $16.9 million to $33.0 million compared to $16.1 million for the year ended December 31, 2021. Net interest margin for the year ended December 31, 2022 was 3.39% compared to 3.07% for the prior year. Noninterest income experienced 38% growth year-over-year to $3.0 million for 2022 from $2.1 million in 2021 primarily due to increased gain on sale of loans following the Bank's successful introduction of SBA lending.

Balance Sheet
Total assets were $1.164 billion at December 31, 2022 compared to $1.145 billion at September 30, 2022 and $932.8 million at December 31, 2021. Deposits and net loans as of December 31, 2022 totaled $946.8 million and $923.2 million, respectively, compared to deposits and net loans of $951.7 million and $859.4 million, respectively, at September 30, 2022 and $771.7 million and $711.7 million, respectively, at December 31, 2021.

Total loans increased $63.9 million from September 30, 2022 to December 31, 2022, or 29.3% annualized, with the average commercial loan size during the fourth quarter of 2022 of approximately $550,000. 

As a result of the Bank's strategic decision to delay certain deposit gathering initiatives during the critical period surrounding the core system conversion in the fourth quarter, year-end deposits experienced a slight decrease from September 30, 2022 to December 31, 2022. However, average deposits for the fourth quarter of 2022 increased $35.2 million to $934.6 million compared to $899.4 million for the third quarter of 2022, driven primarily by a $28.7 million increase in average noninterest-bearing demand deposits. Given increased volatility in deposits due to additional clients utilizing excess liquidity and market competition amid rising rates, the Bank increased Federal Home Loan Bank borrowings to provide additional liquidity to meet the credit needs of clients. As a result, other borrowings increased to $20.9 million at December 31, 2022.

Total assets and net loans at December 31, 2022 increased to $1.164 billion and $923.2 million, respectively, compared to $932.8 million and $711.7 million, respectively, at December 31, 2021, representing 29.7% growth in net loans and a 24.8% increase in total assets year over year. In addition, total deposits grew $175.1 million over the year, including a $63.5 million, or 49.2%, increase in noninterest bearing deposits.

Shareholders' equity increased from $136.9 million at September 30, 2022 to $138.6 million at December 31, 2022 due primarily to a $2.0 million decrease in accumulated other comprehensive loss as a result of decreased unrealized losses on available-for-sale securities. Year-over-year, shareholders' equity increased $28.9 million due to net proceeds from the Company's Initial Public Offering and an increase in retained earnings, partially offset by a $8.2 million accumulated other comprehensive loss recognized during the year due to the rising interest rate environment in 2022.

Asset Quality
As of December 31, 2022, the Company's non-performing assets were $2.5 million, representing 0.21% of total assets. Non-performing assets at December 31, 2022 excluded purchased credit impaired loans with a balance of $2.5 million. 

The allowance for loan losses measured 0.50% of total loans, or approximately 0.78% of the non-purchased portfolio, at December 31, 2022, compared to 0.53% of total loans, or approximately 0.89% of the non-purchased portfolio, at September 30, 2022. The total of the allowance for loan losses and the credit fair value adjustment made to loans acquired in the GNB Financial merger equaled $9.7 million or approximately 1.04% of the combined portfolio at December 31, 2022.

Capital
The Bank's regulatory capital ratios are in excess of regulatory minimums to be considered "well capitalized" as of December 31, 2022. The Bank's Total Capital Ratio and Tier 1 Capital Ratio increased to 12.89% and 12.41%, respectively, at December 31, 2022 from 11.55% and 11.04% at September 30, 2022, respectively. The Company's ratio of Tangible Common Equity to Tangible Assets was 9.02%² at December 31, 2022.

__________________________

2 See Appendix A — Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP measure.

ABOUT LINKBANCORP, Inc.
LINKBANCORP, Inc. was formed in 2018 with a mission to positively impact lives through community banking. Its subsidiary bank, LINKBANK, is a Pennsylvania state-chartered bank serving individuals, families, nonprofits and business clients throughout Central and Southeastern Pennsylvania through 10 client solutions centers and www.linkbank.com.   LINKBANCORP, Inc. common stock is traded on the Nasdaq Capital Market under the symbol "LNKB". For further company information, visit ir.linkbancorp.com.

Forward Looking Statements
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of current or historical fact and involve substantial risks and uncertainties. Words such as "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "projects," "may," "will," "should," and other similar expressions can be used to identify forward-looking statements. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. Among the risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements include, but are not limited to the following: costs or difficulties associated with newly developed or acquired operations; changes in general economic trends, including inflation and changes in interest rates; increased competition; changes in consumer demand for financial services; our ability to control costs and expenses; adverse developments in borrower industries and, in particular, declines in real estate values; changes in and compliance with federal and state laws that regulate our business and capital levels; our ability to raise capital as needed; and the effects of the COVID-19 pandemic and actions taken by governments, businesses and individuals in response. The Company does not undertake, and specifically disclaims, any obligation to publicly revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements, except as required by law. Accordingly, you should not place undue reliance on forward-looking statements.

LB-E
LB-D

 

LINKBANCORP, Inc. and Subsidiaries
Consolidated Balance Sheet (Unaudited)
		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
(In Thousands, except share and per share data)
ASSETS
Noninterest-bearing cash equivalents		$                4,209		$                   8,711		$                7,563		$               6,425		$                8,620
Interest-bearing deposits with other institutions		25,802		66,085		55,433		102,704		13,970
Cash and cash equivalents		$              30,011		$                 74,796		$              62,996		$          109,129		$              22,590
Certificates of deposit with other banks		5,623		8,358		11,088		12,828		12,828
Securities available for sale, at fair value		78,813		78,698		85,756		93,202		103,783
Securities held to maturity		31,822		32,571		28,816		5,000		—
Loans held for sale		—		—		—		4,074		3,860
Loans receivable, gross		927,871		863,969		790,406		731,061		714,816
Allowance for Loan Losses		(4,666)		(4,569)		(3,890)		(3,443)		(3,152)
Loans receivable, net		923,205		859,400		786,516		727,618		711,664
Investments in restricted bank stock		3,377		3,327		2,567		3,612		2,685
Premises and equipment, net		6,743		9,087		7,915		5,253		5,289
Right-of-Use Asset – Premises		10,219		8,920		4,513		4,605		4,680
Bank-owned life insurance		19,244		19,127		19,012		18,898		18,787
Goodwill and other intangible assets		36,894		36,955		37,020		37,085		37,152
Deferred tax asset		5,619		6,378		5,777		5,092		4,038
Accrued interest receivable and other assets		12,084		7,256		7,909		9,280		5,407
TOTAL ASSETS		$        1,163,654		$            1,144,873		$        1,059,885		$       1,035,676		$            932,763
LIABILITIES
Deposits:
Demand, noninterest bearing		$            192,773		$               184,857		$            184,345		$          165,228		$            129,243
Interest bearing		753,999		766,853		718,028		696,942		642,422
Total deposits		946,772		951,710		902,373		862,170		771,665
Other Borrowings		20,938		—		1,639		36,117		19,814
Subordinated Debt		40,484		40,526		40,585		20,653		20,696
Operating Lease Liabilities		10,219		8,921		4,513		4,606		4,680
Accrued interest payable and other liabilities		6,688		6,774		6,004		5,790		6,285
TOTAL LIABILITIES		1,025,101		1,007,931		955,114		929,336		823,140
SHAREHOLDERS' EQUITY
Preferred stock		—		—		—		—		—
Common stock		149		149		99		99		99
Surplus		117,709		117,698		83,070		82,930		82,910
Retained earnings		27,100		27,525		26,491		25,623		24,836
Accumulated other comprehensive (loss) income		(6,405)		(8,430)		(4,889)		(2,312)		1,778
TOTAL SHAREHOLDERS' EQUITY		138,553		136,942		104,771		106,340		109,623
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$        1,163,654		$            1,144,873		$        1,059,885		$       1,035,676		$            932,763
Common shares outstanding		14,939,640		14,939,640		9,838,435		9,826,435		9,826,435

 

LINKBANCORP, Inc. and Subsidiaries
Consolidated Statements of Operations (Unaudited)
		Three Months Ended							Twelve Months Ended
		12/31/2022		9/30/2022		12/31/2021				12/31/2022		12/31/2021
(In Thousands, except share and per share data)
INTEREST AND DIVIDEND INCOME
Loans receivable, including fees		$          11,109		$            9,410		$            7,286				$          36,396		$          15,924
Other		1,097		1,170		651				3,868		2,572
Total interest and dividend income		12,206		10,580		7,937				40,264		18,496
INTEREST EXPENSE
Deposits		2,465		1,389		621				5,337		2,091
Other Borrowings		335		82		25				441		50
Subordinated Debt		421		439		212				1,501		249
Total interest expense		3,221		1,910		858				7,279		2,390
NET INTEREST INCOME BEFORE PROVISION FOR    LOAN LOSSES		8,985		8,670		7,079				32,985		16,106
Provision for loan losses		100		515		100				1,290		648
NET INTEREST INCOME AFTER PROVISION FOR    LOAN LOSSES		8,885		8,155		6,979				31,695		15,458
NONINTEREST INCOME
Service charges on deposit accounts		188		216		216				832		733
Bank-owned life insurance		116		156		77				497		253
Net realized gains on the sales of debt securities, available for sale		—		—		74				13		74
Gain on sale of loans		—		420		—				753		316
Other		204		249		214				862		763
Total noninterest income		508		1,041		581				2,957		2,139
NONINTEREST EXPENSE
Salaries and employee benefits		4,612		4,234		3,602				16,224		6,999
Occupancy		616		596		406				2,119		913
Equipment and data processing		751		666		537				2,609		1,340
Professional fees		371		330		421				1,236		685
FDIC insurance		157		141		81				640		231
Bank Shares Tax		201		201		174				786		434
Merger & system conversion related expenses		973		—		616				973		4,584
Other		764		877		957				3,245		2,311
Total noninterest expense		8,445		7,045		6,794				27,832		17,497
Income before income tax (benefit) expense		948		2,151		766				6,820		100
Income tax (benefit) expense		252		379		(22)				1,222		(189)
NET INCOME		$               696		$            1,772		$               788				$            5,598		$               289
EARNINGS PER SHARE, BASIC		$              0.05		$              0.17		$              0.08				$              0.49		$              0.04
EARNINGS PER SHARE, DILUTED		$              0.05		$              0.17		$              0.08				$              0.49		$              0.04
WEIGHTED-AVERAGE COMMON SHARES    OUTSTANDING,
BASIC		14,939,640		10,590,079		9,822,273				11,310,386		6,879,658
DILUTED		14,939,640		10,590,079		10,178,487				11,310,386		7,250,463

 

LINKBANCORP, Inc. and Subsidiaries
Financial Highlights (Unaudited)
		For the Three Months Ended						For the Twelve Months Ended
('Dollars In Thousands)		12/31/2022		9/30/2022		12/31/2021		12/31/2022		12/31/2021
Operating Highlights
Net Income		$                  696		$               1,772		$               788		$              5,598		$                289
Net Interest Income		8,985		8,670		7,079		32,985		16,106
Provision for Loan Losses		100		515		100		1,290		648
Non-Interest Income		508		1,041		581		2,957		2,139
Non-Interest Expense		8,445		7,045		6,794		27,832		17,497
Earnings per Share, Basic		0.05		0.17		0.08		0.49		0.04
Adjusted Earnings per Share, Basic (2)		0.10		0.17		0.12		0.56		0.56
Earnings per Share, Diluted		0.05		0.17		0.08		0.49		0.04
Adjusted Earnings per Share, Diluted (2)		0.10		0.17		0.12		0.56		0.53
Selected Operating Ratios
Net Interest Margin		3.36 %		3.51 %		3.27 %		3.39 %		3.07 %
Annualized Return on Assets ("ROA")		0.24 %		0.65 %		0.33 %		0.53 %		0.05 %
Adjusted ROA2		0.50 %		0.65 %		0.51 %		0.60 %		0.68 %
Annualized Return on Equity ("ROE")		2.02 %		6.48 %		3.14 %		5.22 %		0.56 %
Adjusted ROE2		4.24 %		6.48 %		4.90 %		5.93 %		7.52 %
Efficiency Ratio		88.96 %		72.55 %		88.69 %		77.44 %		95.90 %
Adjusted Efficiency Ratio3		78.71 %		72.55 %		81.44 %		74.76 %		71.06 %
Noninterest Income to Avg. Assets		0.17 %		0.36 %		0.24 %		0.28 %		0.37 %
Noninterest Expense to Avg. Assets		2.90 %		2.60 %		2.84 %		2.63 %		3.07 %
		12/31/2022		9/30/2022		6/30/2022		3/31/2022		12/31/2021
Financial Condition Data
Total Assets		$       1,163,654		$       1,144,873		$    1,059,885		$      1,035,676		$        932,763
Loans Receivable, Net		923,205		859,400		786,516		727,618		711,664
Noninterest-bearing Deposits		192,773		184,857		184,345		165,228		129,243
Interst-bearing Deposits		753,999		766,853		718,028		696,942		642,422
Total Deposits		946,772		951,710		902,373		862,170		771,665
Selected Balance Sheet Ratios
Total Capital Ratio1		12.89 %		11.55 %		12.42 %		11.14 %		11.50 %
Tier 1 Capital Ratio1		12.41 %		11.04 %		11.94 %		10.67 %		11.02 %
Common Equity Tier 1 Capital Ratio1		12.41 %		11.04 %		11.94 %		10.67 %		11.02 %
Leverage Ratio1		10.93 %		9.74 %		10.10 %		8.71 %		8.85 %
Tangible Common Equity to Tangible Assets4		9.02 %		9.02 %		6.62 %		6.94 %		8.09 %
Tangible Book Value per Share5		$                 6.80		$                 6.69		$              6.89		$                7.05		$               7.38
Asset Quality Data
Non-performing Assets		$               2,500		$               1,979		$           1,494		$              1,246		$             1,396
Non-performing Assets to Total Assets		0.21 %		0.17 %		0.14 %		0.12 %		0.15 %
Non-performing Loans to Total Loans		0.27 %		0.23 %		0.19 %		0.17 %		0.20 %
Allowance for Loan Losses ("AFLL")		$               4,666		$               4,569		$           3,890		$              3,443		$             3,152
AFLL to Total Loans		0.50 %		0.53 %		0.49 %		0.47 %		0.44 %
AFLL to Nonperforming Assets		186.64 %		230.87 %		260.37 %		276.32 %		225.79 %

(1) - These capital ratios have been calculated using bank-level capital

(2) - This is a non-GAAP financial measure.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.

(3) - The efficiency ratio, as adjusted represents noninterst expense divided by the sum of net interest income and noninterest income, excluding gains or losses from securities sales and merger related expenses.  This is a non-GAAP financial measure.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.

(4) - We calculate tangible common equity as total shareholders' equity less goodwill and other intangibles, and we calculate tangible assets as total assets less goodwill and other intangibles.  This is a non-GAAP financial measure.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.

(5) - We calculate tangible book value per common share as total shareholders' equity less goodwill and other intangibles, divided by the outstanding number of shares of our common stock at the end of the relevant period.  Tangible book value per common share is a non-GAAP financial measure, and, as we calculate tangible book value per common share, the most directly comparable GAAP financial measure is book value per common share.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.

 

LINKBANCORP, Inc. and Subsidiaries
Net Interst Margin - Quarter-To-Date (Unaudited)
		For the Three Months Ended December 31,
		2022						2021
(Dollars in thousands)		Avg Bal		Interest (2)		Yield/Rate		Avg Bal		Interest (2)		Yield/Rate
Int. Earn. Cash		$                 42,925		$                       227		2.10 %		$                 51,293		$                         15		0.12 %
Securities
Taxable (1)		80,842		567		2.78 %		74,022		290		1.55 %
Tax-Exempt		37,169		384		4.10 %		47,027		438		3.70 %
Total Securities		118,011		951		3.20 %		121,049		728		2.39 %
Total Cash Equiv. and Investments		160,936		1,178		2.90 %		172,342		743		1.71 %
Total Loans (3)		899,028		11,109		4.90 %		686,589		7,286		4.21 %
Total Earning Assets		1,059,964		12,287		4.60 %		858,931		8,029		3.71 %
Other Assets		94,628						89,829
Total Assets		$            1,154,592						$               948,760
Interest bearing demand		$               278,816		$                       808		1.15 %		$               218,173		$                       234		0.43 %
Money market demand		245,154		966		1.56 %		206,482		125		0.24 %
Time deposits		211,090		691		1.30 %		191,411		262		0.54 %
Total Borrowings		68,160		756		4.40 %		49,917		237		1.88 %
Total Interest-Bearing Liabilities		803,220		3,221		1.59 %		665,983		858		0.51 %
Non Int Bearing Deposits		199,556						171,885
Total Cost of Funds		$            1,002,776		$                   3,221		1.27 %		$               837,868		$                       858		0.41 %
Other Liabilities		14,864						11,308
Total Liabilities		$            1,017,640						$               849,176
Shareholders' Equity		$               136,952						$                 99,584
Total Liabilities & Shareholders' Equity		$            1,154,592						$               948,760
Net Interest Income/Spread (FTE)				9,066		3.01 %				7,171		3.20 %
Tax-Equivalent Basis  Adjustment				(81)						(92)
Net Interest Income				$                   8,985						$                   7,079
Net Interest Margin						3.36 %						3.27 %

(1) Taxable income on securities includes income from available for sale securities and income from certificates of deposits with other banks.

(2) Income stated on a tax equivalent basis which is a non-GAAP measure and reconciled to GAAP at the bottom of the table

(3) Includes the balances of nonaccrual loans

 

LINKBANCORP, Inc. and Subsidiaries
Net Interst Margin - Linked Quarter-To-Date (Unaudited)
		For the Three Months Ended
		December 31, 2022						September 30, 2022
(Dollars in thousands)		Avg Bal		Interest (2)		Yield/Rate		Avg Bal		Interest (2)		Yield/Rate
Int. Earn. Cash		$                  42,925		$               227		2.10 %		$           30,630		$               157		2.03 %
Securities
Taxable (1)		80,842		567		2.78 %		86,330		745		3.42 %
Tax-Exempt		37,169		384		4.10 %		39,258		339		3.43 %
Total Securities		118,011		951		3.20 %		125,588		1,084		3.42 %
Total Cash Equiv. and Investments		160,936		1,178		2.90 %		156,218		1,241		3.15 %
Total Loans (3)		899,028		11,109		4.90 %		824,309		9,410		4.53 %
Total Earning Assets		1,059,964		12,287		4.60 %		980,527		10,651		4.31 %
Other Assets		94,628						93,116
Total Assets		$            1,154,592						$      1,073,643
Interest bearing demand		$               278,816		$               808		1.15 %		$         278,637		$               400		0.57 %
Money market demand		245,154		966		1.56 %		244,107		568		0.92 %
Time deposits		211,090		691		1.30 %		205,792		421		0.81 %
Total Borrowings		68,160		756		4.40 %		52,562		521		3.93 %
Total Interest-Bearing Liabilities		803,220		3,221		1.59 %		781,098		1,910		0.97 %
Non Int Bearing Deposits		199,556						170,863
Total Cost of Funds		$            1,002,776		$           3,221		1.27 %		$         951,961		$            1,910		0.80 %
Other Liabilities		14,864						13,243
Total Liabilities		$            1,017,640						$         965,204
Shareholders' Equity		$               136,952						$         108,439
Total Liabilities & Shareholders' Equity		$            1,154,592						$      1,073,643
Net Interest Income/Spread (FTE)				9,066		3.01 %				8,741		3.34 %
Tax-Equivalent Basis  Adjustment				(81)						(71)
Net Interest Income				$           8,985						$            8,670
Net Interest Margin						3.36 %						3.51 %

(1) Taxable income on securities includes income from available for sale securities and income from certificates of deposits with other banks.

(2) Income stated on a tax equivalent basis which is a non-GAAP measure and reconciled to GAAP at the bottom of the table

(3) Includes the balances of nonaccrual loans

 

LINKBANCORP, Inc. and Subsidiaries
Net Interst Margin - Year-To-Date (Unaudited)
		For the Year Ended December 31,
		2022						2021
(Dollars in thousands)		Avg Bal		Interest (2)		Yield/Rate		Avg Bal		Interest (2)		Yield/Rate
Int. Earn. Cash		$                 56,783		$                       533		0.94 %		$                 35,279		$                       381		1.08 %
Securities
Taxable (1)		78,629		2,175		2.77 %		73,960		939		1.27 %
Tax-Exempt		40,388		1,468		3.63 %		44,719		1,585		3.54 %
Total Securities		119,017		3,643		3.06 %		118,679		2,524		2.13 %
Total Cash Equiv. and Investments		175,800		4,176		2.38 %		153,958		2,905		1.89 %
Total Loans (3)		795,908		36,396		4.57 %		369,849		15,924		4.31 %
Total Earning Assets		971,708		40,572		4.18 %		523,807		18,829		3.59 %
Other Assets		88,485						46,615
Total Assets		$            1,060,193						$               570,422
Interest bearing demand		$               271,681		$                   1,713		0.63 %		$               175,133		$                   1,034		0.59 %
Money market demand		229,979		1,911		0.83 %		112,511		198		0.18 %
Time deposits		205,636		1,713		0.83 %		110,928		859		0.77 %
Total Borrowings		55,980		1,942		3.47 %		14,881		299		2.01 %
Total Interest-Bearing Liabilities		763,276		7,279		0.95 %		413,453		2,390		0.58 %
Non Int Bearing Deposits		173,938						99,747
Total Cost of Funds		$               937,214		$                   7,279		0.78 %		$               513,200		$                   2,390		0.47 %
Other Liabilities		15,806						5,965
Total Liabilities		$               953,020						$               519,165
Shareholders' Equity		$               107,173						$                 51,257
Total Liabilities & Shareholders' Equity		$            1,060,193						$               570,422
Net Interest Income/Spread (FTE)				33,293		3.22 %				16,439		3.01 %
Tax-Equivalent Basis  Adjustment				(308)						(333)
Net Interest Income				$                 32,985						$                 16,106
Net Interest Margin						3.39 %						3.07 %

(1) Taxable income on securities includes income from available for sale securities and income from certificates of deposits with other banks.

(2) Income stated on a tax equivalent basis which is a non-GAAP measure and reconciled to GAAP at the bottom of the table

(3) Includes the balances of nonaccrual loans

 

LINKBANCORP, Inc. and Subsidiaries
Loans Receivable Detail (Unaudited)
(In Thousands)		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
Agriculture loans		$           15,591		$         13,977		$         7,710		$         8,111		$          9,341
Commercial loans		103,874		97,542		88,452		94,114		98,604
Paycheck Protection Program ("PPP") loans		881		933		2,527		10,586		23,774
Commercial real estate loans		540,914		482,367		435,588		353,559		338,749
Residential real estate loans		250,832		251,832		241,401		252,158		231,302
Consumer and other loans		10,057		11,929		8,689		6,359		7,087
Municipal loans		5,466		5,404		5,814		6,193		6,182
		927,615		863,984		790,181		731,080		715,039
Deferred costs (fees)		256		(15)		225		(19)		(223)
Total loans receivable		$        927,871		$      863,969		$    790,406		$    731,061		$      714,816

 

LINKBANCORP, Inc. and Subsidiaries
Investments in Securities Detail (Unaudited)
		December 31, 2022
(In Thousands)		Amortized Cost		Net Unrealized Losses		Fair Value
Available for Sale:
Small Business Administration loan pools		$             858		$                  (15)		$             843
Obligations of state and political subdivisions		44,189		(4,020)		40,169
Mortgage-backed securities in government-sponsored entities		41,873		(4,072)		37,801
		$       86,920		$             (8,107)		$       78,813
Held to Maturity:
Corporate debentures		$       14,993		$                (994)		$       13,999
Structured mortgage-backed securities		16,829		(748)		16,081
		$       31,822		$             (1,742)		$       30,080
		December 31, 2021
(In Thousands)		Amortized Cost		Net Unrealized Gains (Losses)		Fair Value
Available for Sale:
Small Business Administration loan pools		$         1,099		$                  (15)		$         1,084
Obligations of state and political subdivisions		46,115		2,367		48,482
Mortgage-backed securities in government-sponsored entities		54,239		(22)		54,217
		$     101,453		$               2,330		$     103,783

 

LINKBANCORP, Inc. and Subsidiaries
Deposits Detail (Unaudited)
(In Thousands)		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
Demand, noninterest-bearing		$ 192,773		$ 184,857		$ 184,345		$ 165,228		$  129,243
Demand, interest-bearing		254,478		305,934		269,493		269,222		256,258
Money market and savings		228,048		266,743		235,411		224,673		205,843
Time deposits, $250 and over		46,116		39,123		55,507		55,514		56,266
Time deposits, other		225,357		155,053		157,617		147,533		124,055
		$ 946,772		$ 951,710		$ 902,373		$ 862,170		$  771,665
Average Deposits Detail, for the Three Months Ended (Unaudited)
(In Thousands)		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
Demand, noninterest-bearing		$ 199,556		$ 170,863		$ 152,691		$ 131,841		$  171,885
Demand, interest-bearing		278,816		278,637		270,844		258,140		218,173
Money market and savings		245,154		244,107		224,483		215,410		206,482
Time deposits		211,090		205,792		211,033		194,897		191,411
		$ 934,616		$ 899,399		$ 859,051		$ 800,288		$  787,951

 

Appendix A – Reconciliation to Non-GAAP Financial Measures

This document contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Management uses these non-GAAP measures in its analysis of the Company's performance. These measures should not be considered a substitute for GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with GAAP. Management believes the presentation of non-GAAP financial measures that exclude the impact of specified items provide useful supplemental information that is essential to a proper understanding of the Company's financial condition and results. Non-GAAP measures are not formally defined under GAAP, and other entities may use calculation methods that differ from those used by us. As a complement to GAAP financial measures, our management believes these non-GAAP financial measures assist investors in comparing the financial condition and results of operations of financial institutions due to the industry prevalence of such non-GAAP measures. See the tables below for a reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures.

Adjusted Return on Average Assets
	For the Three Months Ended						For the Year Ended
(Dollars in thousands)	12/31/2022		9/30/2022		12/31/2021		12/31/2022		12/31/2021
Net income	$               696		$            1,772		$               788		$            5,598		$            289
Average assets	1,154,592		1,073,643		948,760		1,060,193		570,422
Return on average assets (annualized)	0.24 %		0.65 %		0.33 %		0.53 %		0.05 %
Net income	696		1,772		788		5,598		289
Net gains on sale of securities	-		-		(74)		(13)		(74)
Tax effect at 21%	-		-		16		3		16
Merger & system conversion related expenses	973		-		616		973		4,584
Tax effect at 21%	(204)		-		(129)		(204)		(963)
Adjusted Net Income (Non-GAAP)	1,465		1,772		1,217		6,357		3,852
Average assets	1,154,592		1,073,643		948,760		1,060,193		570,422
Adjusted return on average assets (annualized) (Non-GAAP)	0.50 %		0.65 %		0.51 %		0.60 %		0.68 %

 

Adjusted Return on Average Shareholders' Equity
	For the Three Months Ended						For the Year Ended
(Dollars in thousands)	12/31/2022		9/30/2022		12/31/2021		12/31/2022		12/31/2021
Net income	$            696		$     1,772		$          788		$       5,598		$          289
Average shareholders' equity	136,952		108,439		99,584		107,173		51,257
Return on average shareholders' equity (annualized)	2.02 %		6.48 %		3.14 %		5.22 %		0.56 %
Net income	696		1,772		788		5,598		289
Net gains on sale of securities	-		-		(74)		(13)		(74)
Tax effect at 21%	-				16		3		16
Merger & system conversion related expenses	973		-		616		973		4,584
Tax effect at 21%	(204)		-		(129)		(204)		(963)
Adjusted Net Income (Non-GAAP)	1,465		1,772		1,217		6,357		3,852
Average shareholders' equity	136,952		108,439		99,584		107,173		51,257
Adjusted return on average shareholders' equity (annualized) (Non-GAAP)	4.24 %		6.48 %		4.90 %		5.93 %		7.52 %

 

Adjusted Efficiency Ratio
	For the Three Months Ended						For the Year Ended
(Dollars in thousands)	12/31/2022		9/30/2022		12/31/2021		12/31/2022		12/31/2021
GAAP-based efficiency ratio	88.96 %		72.55 %		88.69 %		77.44 %		95.90 %
Net interest income	$      8,985		$      8,670		$          7,079		$             32,985		$     16,106
Noninterest income	508		1,041		581		2,957		2,139
Less: net gains on sales of securities	-		-		74		13		74
Adjusted revenue (Non-GAAP)	9,493		9,711		7,586		35,929		18,171
Total noninterest expense	8,445		7,045		6,794		27,832		17,497
Less: Merger & system conversion related expenses	973		-		616		973		4,584
Adjusted non-interest expense	7,472		7,045		6,178		26,859		12,913
Efficiency ratio, as adjusted (Non-GAAP)	78.71 %		72.55 %		81.44 %		74.76 %		71.06 %

 

Adjusted Earnings Per Share
	For the Three Months Ended						For the Year Ended
(Dollars in thousands, except per share data)	12/31/2022		9/30/2022		12/31/2021		12/31/2022		12/31/2021
GAAP-Based Earnings Per Share, Basic	$              0.05		$         0.17		$            0.08		$                  0.49		$         0.04
GAAP-Based Earnings Per Share, Diluted	$              0.05		$         0.17		$            0.08		$                  0.49		$         0.04
Net Income	$               696		$      1,772		$             788		$               5,598		$          289
Net gains on sale of securities	-		-		(74)		(13)		(74)
Tax effect at 21%	-		-		16		3		16
Merger & system conversion related expenses	973		-		616		973		4,584
Tax effect at 21%	(204)		-		(129)		(204)		(963)
Adjusted Net Income (Non-GAAP)	1,465		1,772		1,217		6,357		3,852
Adjusted Earnings per Share, Basic (Non-GAAP)	$              0.10		$         0.17		$            0.12		$                  0.56		$         0.56
Adjusted Earnings per Share, Diluted (Non-GAAP)	$              0.10		$         0.17		$            0.12		$                  0.56		$         0.53

 

Tangible Common Equity and Tangible Book Value
		12/31/2022		9/30/2022		6/30/2022		3/31/2022		12/31/2021
Tangible Common Equity		(Dollars in thousands, except for share data)
Total shareholders' equity		$       138,553		$     136,942		$     104,771		$     106,340		$     109,623
Adjustments:
Goodwill		(35,842)		(35,842)		(35,842)		(35,842)		(35,512)
Other intangible assets		(1,052)		(1,113)		(1,178)		(1,243)		(1,310)
Tangible common equity (Non-GAAP)		$       101,659		$       99,987		$       67,751		$       69,255		$       72,801
Common shares outstanding		14,939,640		14,939,640		9,838,435		9,826,435		9,826,435
Book value per common share		$              9.27		$            9.17		$          10.65		$          10.82		$          11.16
Tangible book value per common share (Non-GAAP)		$              6.80		$            6.69		$            6.89		$            7.05		$            7.41
Tangible Assets
Total assets		$    1,163,654		$  1,144,873		$  1,059,885		$  1,035,676		$     932,763
Adjustments:
Goodwill		(35,842)		(35,842)		(35,842)		(35,842)		(35,512)
Other intangible assets		(1,052)		(1,113)		(1,178)		(1,243)		(1,310)
Tangible assets (Non-GAAP)		$    1,126,760		$  1,107,918		$  1,022,865		$     998,591		$     895,941
Tangible common equity to tangible assets (Non-GAAP)		9.02 %		9.02 %		6.62 %		6.94 %		8.13 %

 

Contact:
Nicole Ulmer
Corporate and Investor Relations Officer
717.803.8895
IR@LINKBANCORP.COM

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SOURCE LINKBANCORP, Inc.

FAQ

What were LINKBANCORP's earnings for Q4 2022?

LINKBANCORP reported a net income of $696 thousand for Q4 2022.

How much did LINKBANCORP increase its loans in Q4 2022?

LINKBANCORP's net loans grew by $63.8 million in Q4 2022.

When is LINKBANCORP's next dividend payment?

The next dividend payment is scheduled for March 15, 2023.

What is LINKBANCORP's net interest margin for Q4 2022?

The net interest margin for Q4 2022 was 3.36%.

How has LINKBANCORP's total assets changed year-over-year?

Total assets increased to $1.164 billion at December 31, 2022, up from $932.8 million a year earlier.