Mid-Southern Bancorp, Inc. Reports Results of Operations for the Second Quarter Ended June 30, 2022
Mid-Southern Bancorp reported a net income of $526,000 for Q2 2022, up from $397,000 in 2021. Net income for the first half reached $993,000, compared to $775,000 last year. Interest income rose 14.8%, driven by higher loan balances and yields, while interest expense increased by 3.6%. Total assets grew to $266.5 million, fueled by increases in loans and investment securities. Non-performing loans increased slightly, totaling $822,000, and the allowance for loan losses reached $1.6 million. The bank maintained a strong capital position with a CBLR of 15.7% as of June 30, 2022.
- Net income for Q2 2022 increased to $526,000, up 32.5% from Q2 2021.
- Total interest income rose by 14.8%, reflecting growth in loans and investment yields.
- Total assets increased to $266.5 million, up from $254.3 million at year-end.
- The bank's CBLR of 15.7% indicates a strong capital position.
- Non-performing loans rose to $822,000, an increase from $753,000 at the end of 2021.
- Stockholders' equity decreased to $34.4 million from $46.5 million at the end of 2021.
- Net charge-offs reported for Q2 2022 were $1,000, compared to net recoveries of $22,000 in Q2 2021.
SALEM, Ind., July 25, 2022 (GLOBE NEWSWIRE) -- Mid-Southern Bancorp, Inc. (the “Company”) (NASDAQ: MSVB), the holding company for Mid-Southern Savings Bank, FSB (the “Bank”), reported net income for the second quarter ended June 30, 2022 of
Income Statement Review
Net interest income after provision for loan losses increased
Net interest income after provision for loan losses increased
Noninterest income increased
Noninterest income increased
Noninterest expense increased
Noninterest expense increased
The Company recorded an income tax expense of
Balance Sheet Review
Total assets as of June 30, 2022 were
Credit Quality
Non-performing loans increased to
Based on management’s analysis of the allowance for loan losses, the Company recorded a provision for loan losses of
The Company recorded a provision for loan losses of
Capital
The Bank elected to use the CBLR effective January 1, 2020. Effective January 1, 2022, a bank or savings institution electing to use the Community Bank Leverage Ratio (“CBLR”) will generally be considered well-capitalized and to have met the risk-based and leverage capital requirements of the capital regulations if it has a leverage ratio greater than
At June 30, 2022, the Bank was considered well-capitalized under applicable federal regulatory capital guidelines with a CBLR of
The Company’s stockholders’ equity decreased to
About Mid-Southern Bancorp, Inc.
Mid-Southern Savings Bank, FSB is a federally chartered savings bank headquartered in Salem, Indiana, approximately 40 miles northwest of Louisville, Kentucky. The Bank conducts business from its main office in Salem and through its branch offices located in Mitchell and Orleans, Indiana and loan production offices located in New Albany, Indiana and Louisville, Kentucky.
Cautionary Note Regarding Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect,” “will,” “may,” “continue,” or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include the effect of the COVID-19 pandemic, including on the Company’s credit quality and business operations, as well as its impact on general economic and financial market conditions and other uncertainties resulting from the COVID-19 pandemic, such as the extent and duration of the impact on public health, the U.S. and global economies, and consumer and corporate customers, including economic activity, employment levels and market liquidity; increased competitive pressures; changes in the interest rate environment; general economic conditions or conditions within the securities markets; and legislative and regulatory changes affecting financial institutions, including regulatory compliance costs and capital requirements that could adversely affect the business in which the Company and the Bank are engaged; and other factors described in the Company’s latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission that are available on our website at mid-southern.com and on the SEC’s website at www.sec.gov.
The factors listed above could materially affect the Company’s financial performance and could cause the Company’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements.
Except as required by applicable law, the Company does not undertake and specifically declines any obligation to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. When considering forward-looking statements, you should keep in mind these risks and uncertainties. You should not place undue reliance on any forward-looking statement, which speaks only as of the date made.
MID-SOUTHERN BANCORP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
(Dollars in thousands, except per share information)
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
OPERATING DATA | 2022 | 2021 | 2022 | 2021 | |||||||||||
Total interest income | $ | 2,153 | $ | 1,875 | $ | 4,036 | $ | 3,740 | |||||||
Total interest expense | 173 | 167 | 323 | 337 | |||||||||||
Net interest income | 1,980 | 1,708 | 3,713 | 3,403 | |||||||||||
Provision for loan losses | 50 | — | 50 | — | |||||||||||
Net interest income after provision for loan losses | 1,930 | 1,708 | 3,663 | 3,403 | |||||||||||
Total non-interest income | 364 | 325 | 649 | 599 | |||||||||||
Total non-interest expense | 1,744 | 1,630 | 3,261 | 3,204 | |||||||||||
Income before income taxes | 550 | 403 | 1,051 | 798 | |||||||||||
Income tax expense | 24 | 6 | 58 | 23 | |||||||||||
Net income | $ | 526 | $ | 397 | $ | 993 | $ | 775 | |||||||
Net income per share attributable to common shareholders: | |||||||||||||||
Basic | $ | 0.19 | $ | 0.13 | $ | 0.36 | $ | 0.26 | |||||||
Diluted | $ | 0.19 | $ | 0.13 | $ | 0.36 | $ | 0.26 | |||||||
Weighted average common shares outstanding: | |||||||||||||||
Basic | 2,722,365 | 2,967,050 | 2,766,818 | 2,966,416 | |||||||||||
Diluted | 2,725,889 | 2,976,138 | 2,769,750 | 2,974,648 |
June 30, | December 31, | ||||||
BALANCE SHEET INFORMATION | 2022 | 2021 | |||||
Cash and cash equivalents | $ | 4,423 | $ | 16,379 | |||
Investment securities | 110,959 | 107,314 | |||||
Loans, net | 138,143 | 122,568 | |||||
Interest-earning assets | 255,283 | 247,184 | |||||
Total assets | 266,454 | 254,260 | |||||
Deposits | 205,047 | 196,884 | |||||
Borrowings | 26,000 | 10,000 | |||||
Stockholders' equity | 34,382 | 46,529 | |||||
Common stock shares outstanding | 2,871,325 | 3,016,653 | |||||
Book value per share (1) | 11.97 | 15.42 | |||||
Book value per share excluding AOCI (2) | 15.08 | 14.73 | |||||
Tangible book value per share (3) | 11.97 | 15.42 | |||||
Non-performing assets: | |||||||
Nonaccrual loans | 822 | 753 | |||||
Accruing loans past due 90 days or more | — | — | |||||
Foreclosed real estate | — | — | |||||
Troubled debt restructurings on accrual status | 749 | 786 |
OTHER FINANCIAL DATA
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
Performance ratios: | 2022 | 2021 | 2022 | 2021 | |||||||||||
Cash dividends per share | $ | 0.04 | $ | 0.03 | $ | 0.08 | $ | 0.06 | |||||||
Return on average assets (annualized) | 0.80 | % | 0.64 | % | 0.76 | % | 0.64 | % | |||||||
Return on average stockholders' equity (annualized) | 5.64 | % | 3.26 | % | 4.81 | % | 3.17 | % | |||||||
Net interest margin | 3.20 | % | 3.05 | % | 3.06 | % | 3.09 | % | |||||||
Interest rate spread | 3.11 | % | 2.94 | % | 2.98 | % | 2.98 | % | |||||||
Efficiency ratio | 74.4 | % | 80.2 | % | 74.8 | % | 80.1 | % | |||||||
Average interest-earning assets to average interest-bearing liabilities | 133.2 | % | 138.6 | % | 134.4 | % | 139.5 | % | |||||||
Average stockholders' equity to average assets | 14.2 | % | 19.7 | % | 15.8 | % | 20.1 | % | |||||||
Stockholders' equity to total assets at end of period | 12.9 | % | 19.7 | % |
June 30, | December 31, | ||||
Capital ratios: (4) | 2022 | 2021 | |||
Community Bank Leverage Ratio | 15.7 | % | 16.3 | % |
June 30, | December 31, | |||
Asset quality ratios: | 2022 | 2021 | ||
Allowance for loan losses as a percent of total loans | 1.1 | % | 1.2 | % |
Allowance for loan losses as percent of non-performing loans | 191.1 | % | 202.3 | % |
Net charge-offs (recoveries) to average outstanding loans during the period (annualized) | 0.0 | % | 0.0 | % |
Non-performing loans as a percent of total loans | 0.6 | % | 0.6 | % |
Non-performing assets as a percent of total assets | 0.3 | % | 0.3 | % |
____________________________
(1) - We calculate book value per share as total stockholders’ equity at the end of the relevant period divided by the outstanding number of our common shares at the end of each period.
(2) - Book value per share excluding Accumulated Other Comprehensive Income / Loss (“AOCI”) is a non-GAAP financial measure. We calculate book value per share excluding AOCI as total stockholders’ equity at the end of the relevant period, less AOCI, divided by the outstanding number of our common shares at the end of each period. The most directly comparable GAAP financial measure is book value per share. We provide the book value per share excluding AOCI in addition to those defined by banking regulators because we believe it is important to evaluate the balance sheet both before and after the effects of unrealized amounts associated with mark-to-market adjustments on available-for-sale investment securities. Refer to “Reconciliation of Non-GAAP Financial Measures” below.
(3) - Tangible book value per share is a non-GAAP financial measure. We calculate tangible book value per share as total stockholders’ equity at the end of the relevant period, less goodwill and other intangible assets, divided by the outstanding number of our common shares at the end of each period. The most directly comparable GAAP financial measure is book value per share. We had no goodwill or other intangible assets as of any of the dates indicated. As a result, tangible book value per share is the same as book value per share as of each of the dates indicated. We provide the tangible book value per share in addition to those defined by banking regulators because of its widespread use by investors as a means to evaluate capital adequacy.
(4) - Effective January 1, 2020, the Bank elected to use the CBLR, as provided by the Economic Growth, Regulatory Relief, and Consumer Protection Act (the “Act”). The Act contains a number of provisions extending regulatory relief to banks and savings institutions and their holding companies. A bank or savings institution that elects to use the CBLR will generally be considered well-capitalized and to have met the risk-based and leverage capital requirements of the capital regulations if it has a leverage ratio greater than
June 30, | December 31, | ||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | 2022 | 2021 | |||||
Stockholders' equity | $ | 34,382 | $ | 46,529 | |||
Adjustments: | |||||||
Accumulated other comprehensive income (loss) | (8,915 | ) | 2,096 | ||||
Stockholders' equity excluding AOCI | $ | 43,297 | $ | 44,433 | |||
Common stock shares outstanding | 2,871,325 | 3,016,653 | |||||
Book value per share | $ | 11.97 | $ | 15.42 | |||
Effect of accumulated other comprehensive income (loss) | (3.11 | ) | 0.69 | ||||
Book value per share excluding AOCI | $ | 15.08 | $ | 14.73 |
Contact:
Alexander G. Babey, President and Chief Executive Officer
Robert W. DeRossett, Chief Financial Officer
Mid-Southern Bancorp, Inc.
812-883-2639
FAQ
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What is the Community Bank Leverage Ratio of Mid-Southern Bancorp?
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