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Lewis & Clark Bancorp Announces 2021 Third Quarter and Year to Date Results

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Lewis & Clark Bancorp (OTC Pink: LWCL) announced strong growth in its 2021 Q3 results, reporting a net income of $1.3 million, a significant increase from $319,000 in Q3 2020. Year-to-date net income reached $3.2 million, up from $1.1 million last year, with earnings per share rising to $1.21 and $2.94 respectively. The increase in earnings was attributed to higher net interest income from PPP loans, decreased provision for loan losses, and growth in total assets to $427.3 million. However, continued economic uncertainties may impact future performance.

Positive
  • Q3 net income increased by $980,000 year-over-year to $1,299,000.
  • Year-to-date net income of $3,243,000 reflects a $2,181,000 improvement compared to last year.
  • Earnings per share rose to $1.21 for Q3 and $2.94 year-to-date.
  • Total consolidated assets grew 23.4% to $427.3 million since December 31, 2020.
  • Total deposits increased by $85.6 million, driven by PPP loans and higher savings.
Negative
  • Total gross loans decreased by $55.8 million due to PPP loan forgiveness.
  • Increased provision for income taxes attributed to higher pre-tax earnings could pressure future profits.
  • Loan demand has not yet returned to pre-pandemic levels, indicating potential future revenue challenges.

OREGON CITY, Ore.--(BUSINESS WIRE)-- Lewis & Clark Bancorp (OTC Pink: LWCL) announces 2021 third quarter and year to date consolidated results. Quarter to date net income totaled $1,299,000 for the three months ended September 30, 2021, an increase of $980,000 compared to $319,000 for the same period last year. Earnings per share were $1.21 for the current year quarter, compared to $0.28 for the prior year quarter. Year to date net income totaled $3,243,000 an increase of $2,181,000 compared to $1,062,000 for the same period last year. Earnings per share were $2.94 for the current year period, compared to $0.94 for the prior year period.

The increased earnings in the current year quarter were due to an increase in both net interest income and noninterest income, and a decrease in the provision for loan losses, partially offset by increases in both noninterest expense and the provision for income taxes compared to the same period one year ago. The increase in net interest income is due to an increase in interest and fees on loans primarily related to increased interest and fees earned from the SBA Paycheck Protection Program (PPP) loans and a decrease in interest expense on deposits due to lower cost of funds. These favorable variances were partially offset by an increase in interest expense on borrowings due to the subordinated debt issued in the prior year. The increase in noninterest income was due to an increase in both interchange fees and earnings from bank owned life insurance. The decrease in the provision for loan losses was due to Management’s assessment of risk factors related to the ongoing COVID-19 pandemic and improved qualitative risk factors compared to the prior year. The increase in noninterest expense was due to increases in salaries and employee benefits, data processing, FDIC assessment fees, business related travel expenses, and bank service charges, partially offset by declines in both professional fees and intangible amortization. The increase in the provision for income taxes was due to increased pre-tax earnings compared to the prior year period.

The increased earnings in the current year period were due to an increase in net interest income and a decrease in the provision for loan losses, partially offset by a decrease in noninterest income and increases in both noninterest expense and the provision for income taxes compared to the same period one year ago. The increase in net interest income is due to an increase in interest and fees on loans primarily related to increased interest and fees earned from the SBA Paycheck Protection Program (PPP) loans and a decrease in interest expense on deposits due to lower cost of funds. These favorable variances were partially offset by an increase in interest expense on borrowings due to the subordinated debt issued in the prior year, and a decrease in interest earned on interest bearing cash balances and investments. The decrease in the provision for loan losses was substantially the same as that for the current year quarter as previously discussed. The decrease in noninterest income was due to recording a gain on the liquidation of the securities portfolio in the prior year, partially offset by increases in interchange fees, earnings from bank owned life insurance, and unrealized gains on equity securities. The increase in noninterest expense was due to increases in salaries and employee benefits, occupancy expense, FDIC assessment fees, software license and maintenance fees, employee education and bank service charges. These increases were partially offset by decreases in data processing, professional fees, and amortization for intangible assets.

Jeffrey Sumpter, President and CEO commented, “We are pleased to report increased earnings during the current year period and strong balance sheet growth primarily as a result of increased deposits. We are also pleased to report that we have paid 22 consecutive quarters of shareholder dividends.” Sumpter continued, “Although we have experienced record earnings during the current year, aided by interest and fees on PPP loans, we expect that the ongoing economic uncertainties will impact our performance as we move forward, and although loan demand is steady it has not yet returned to pre-pandemic levels largely due to government stimulus programs, excess borrower liquidity, and supply chain disruptions."

As of September 30, 2021, total consolidated assets were $427.3 million, an increase of $81.0 million, or 23.4%, compared to December 31, 2020. This increase was primarily due to increases in cash, investment securities and total deposits, partially offset by a decline in gross loans and borrowings compared to the balances reported at December 31, 2020. Cash increased by $100.7 million, primarily due to an increase in total deposits and a decrease in gross loans, partially offset by an increase in investment securities and the repayment of borrowings. Investment securities increased by $32.0 million primarily due to management’s decision to deploy excess liquidity into higher yielding assets compared to holding cash. Total deposits increased $85.6 million due to increases in noninterest-bearing and interest-bearing demand deposits, related to the PPP loans, money market and savings deposits, and time deposits. Total gross loans decreased $55.8 million substantially due to $97.6 million in forgiveness related to the PPP loans and principal reductions on existing loans partially offset by originating $44.7 million in new PPP loans. Borrowings decreased $5.9 million due to the repayment of funding provided through the Federal Reserve’s Paycheck Protection Program Liquidity Facility. Shareholders’ equity totaled $38.0 million at September 30, 2021, an increase of $1,100,000, compared to December 31, 2020. The increase was due to earnings of $3,243,000, partially offset by the Company repurchasing $1,897,000 of stock during the current year related to the Company’s share repurchase program, and shareholder dividends totaling $251,000.

About Lewis & Clark Bancorp

Headquartered in Oregon City, Oregon, Lewis & Clark Bancorp is the holding company for Lewis & Clark Bank, a state-chartered full-service commercial bank. Partnering with people and businesses throughout Oregon and SW Washington, the Bank believes that being an integral part of the community it serves, helps promote both growth and success.

For more information about Lewis & Clark Bank, visit www.lewisandclarkbank.com.

Summary Balance Sheet

(dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2021

December 31, 2020

$ Change

% Change

ASSETS

Cash

$

173,916

 

$

73,171

 

$

100,745

 

137.7

%

Equity Securities

 

1,962

 

 

702

 

 

1,260

 

179.5

%

Investment Securities

 

33,520

 

 

1,515

 

 

32,005

 

2112.5

%

Gross loans

 

200,405

 

 

256,233

 

 

(55,828

)

-21.8

%

Allowance for loan losses

 

(3,054

)

 

(3,043

)

 

(11

)

0.4

%

Net loans

 

197,351

 

 

253,190

 

 

(55,839

)

-22.1

%

Fixed Assets

 

7,248

 

 

7,210

 

 

38

 

0.5

%

Other Assets

 

13,272

 

 

10,510

 

 

2,762

 

26.3

%

Total Assets

$

427,269

 

$

346,298

 

$

80,971

 

23.4

%

 

LIABILITIES AND EQUITY

Deposits:

Noninterest bearing

$

108,265

 

$

86,191

 

$

22,074

 

25.6

%

Interest-bearing demand

 

19,313

 

 

16,791

 

 

2,522

 

15.0

%

Money market and savings

 

209,851

 

 

149,915

 

 

59,936

 

40.0

%

Time deposits

 

43,188

 

 

42,082

 

 

1,106

 

2.6

%

Total deposits

 

380,617

 

 

294,979

 

 

85,638

 

29.0

%

Subordinated debentures, net

 

6,899

 

 

6,880

 

 

19

 

0.28

%

Borrowings

 

-

 

 

5,873

 

 

(5,873

)

-100.00

%

Other liabilities

 

1,777

 

 

1,690

 

 

87

 

5.1

%

Total liabilities

 

389,293

 

 

309,422

 

 

79,871

 

25.8

%

Equity

 

37,976

 

 

36,876

 

 

1,100

 

3.0

%

Total Liabilities and Equity

$

427,269

 

$

346,298

 

$

80,971

 

23.4

%

 

Net loans to deposits

 

51.85

%

 

85.83

%

Allowance for loan losses to total loans

 

1.52

%

 

1.19

%

DDA deposits to total deposits

 

28.44

%

 

29.22

%

Tangible book value per share

$

33.46

 

$

31.42

 

Summary Income Statement

(dollars in thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

Three months ended September 30,

Nine months ended September 30,

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

Interest and fees on loans and

investments

$

4,224

 

$

3,121

 

$

11,410

 

$

9,490

 

Interest expense

 

330

 

 

299

 

 

1,068

 

 

1,148

 

Net interest income

 

3,894

 

 

2,822

 

 

10,342

 

 

8,342

 

Provision for loan losses

 

-

 

 

428

 

 

-

 

 

1,055

 

Net interest income after

provision

 

3,894

 

 

2,394

 

 

10,342

 

 

7,287

 

Noninterest income

 

226

 

 

175

 

 

739

 

 

754

 

Noninterest expense

 

2,362

 

 

2,144

 

 

6,735

 

 

6,628

 

Pre-tax income

 

1,758

 

 

425

 

 

4,346

 

 

1,413

 

Provision for income taxes

 

459

 

 

106

 

 

1,103

 

 

351

 

Net income

$

1,299

 

$

319

 

$

3,243

 

$

1,062

 

 

Return on average equity

 

14.04

%

 

3.51

%

 

11.67

%

 

3.92

%

Return on average assets

 

1.18

%

 

0.41

%

 

1.02

%

 

0.47

%

Net interest margin

 

3.73

%

 

3.85

%

 

3.47

%

 

3.95

%

Efficiency ratio

 

57.33

%

 

71.54

%

 

60.78

%

 

72.87

%

 

Jeffrey Sumpter – President and Chief Executive Officer

Phone: (503) 212-3107

John Lende – Executive Vice President and Chief Financial Officer

Phone: (503) 212-3141

Source: Lewis & Clark Bancorp

FAQ

What were Lewis & Clark Bancorp's Q3 2021 earnings results?

Lewis & Clark Bancorp reported a Q3 2021 net income of $1.3 million, significantly up from $319,000 in Q3 2020.

What is the earnings per share for LWCL in the latest report?

Earnings per share for LWCL in Q3 2021 were $1.21, compared to $0.28 in Q3 2020.

How much did total consolidated assets increase for LWCL in 2021?

Total consolidated assets of LWCL increased by 23.4%, reaching $427.3 million as of September 30, 2021.

What factors contributed to the increase in net income for Lewis & Clark Bancorp?

The increase in net income was driven by higher net interest income, decreased provision for loan losses, and increased noninterest income.

How did the pandemic impact Lewis & Clark Bancorp's loan performance?

The ongoing pandemic led to a decrease in total gross loans, largely due to PPP loan forgiveness, affecting overall loan performance.

LEWIS & CLARK BANCORP

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