Orange County Bancorp, Inc. Announces Record First Quarter 2021 Results

Rhea-AI Summary

Orange County Bancorp reported record net income of $5.03 million for Q1 2021, a 103% increase from Q1 2020. Key highlights include a return on average assets of 1.1% and a return on common equity of 14.9%. Average loans, net of PPP, increased 18.5% to $1.1 billion, while average demand deposits grew 60.1% to $552.4 million. The total asset base expanded 14.6% to $1.9 billion. Significant reductions in loan loss provisions and a rise in trust business revenue were also noted.

Positive

• Net income increased by $2.55 million, or 105%, to $5.03 million.
• Return on common equity rose 688 basis points to 14.9%.
• Average loans increased 18.5% year-over-year to $1.1 billion.
• Average demand deposits surged 60.1% year-over-year to $552.4 million.
• Total assets grew 14.6% to $1.9 billion.
• Trust and asset advisory revenue increased 18.6% to $2.3 million.

Negative

• Non-interest expense increased by $725 thousand, or 7.6%.

●	Net Income for Q1 2021 increased by $2.5 million, or 103%, to a record $5.03 million compared to Q1 2020

●	Return on average assets for Q1 2021 rose 37 basis points year-over-year to 1.1%

●	Return on common equity for Q1 2021 rose 688 basis points year-over-year to 14.9%

●	Loan loss provision for Q1 2021 of $66 thousand was $1.1 million below the same period last year due to stabilizing credit trends

●	Average Loans (net of PPP) for Q1 2021 increased 18.5% year-over-year, to $1.1 billion

●	Average Demand Deposits grew 60.1% year-over-year to $552.4 million

●	Total Assets grew $243.8 million, or 14.6% from year-end 2020 to $1.9 billion

●	Trust and asset advisory business revenue increased 18.6% to $2.3 million for the quarter

MIDDLETOWN, NY / ACCESSWIRE / May 3, 2021 / Orange County Bancorp, Inc. (the "Company" - OTCQX: OCBI), parent of Orange Bank & Trust Co. (the "Bank") and Hudson Valley Investment Advisors, Inc. (HVIA), today announced net income of $5.03 million, or $1.12 per share, for the three months ended March 31, 2021. This compares with net income of $2.48 million, or $0.55 per share, for the three months ended March 31, 2020.

"I am extremely proud of the results our team produced this quarter," said Orange County Bancorp President & CEO, Michael Gilfeather. "They reflect the earnings power of our focused and deliberate strategy to grow the Bank and make it a more accessible and important partner for our clients in Orange, Rockland and Westchester Counties. The momentum we were building in 2020, despite the considerable challenges presented by COVID, carried into the first quarter of 2021, resulting in 105% year-over-year growth in net income to a record of over $5 million.

Our core lending business has been and remains strong, with loan growth, net of PPP, up over 18.5% in the first quarter of 2021 versus the same period last year. Many of the compelling opportunities reflected in these figures emerged late last year and continued into the recent quarter. While new loan demand is weighted toward commercial real estate, for which the Bank remains well within conservative concentration limits, overall loan activity remains diverse across both industries and the region we serve. Additionally, despite meaningful growth in the size of our loan portfolio, improving economic and credit trends allowed us to reduce our provision for loan losses more than $1 million versus the same quarter last year. Loans on deferral also continued to decline, finishing the first quarter at just over $32 million, or 2.6% of our loan portfolio, down from nearly 30% at the end of our June quarter in 2020.

As has been widely reported, the Federal Reserve responded to the financial shock of the pandemic last Spring by slashing interest rates and injecting unprecedented liquidity into the banking system. This helped stabilize the economy, but now has the banking system confronting the challenge of elevated deposit levels and narrower lending margins. We sought to manage this by attracting a greater share of business clients' non-interest bearing deposits. The results surpassed expectations, with Average Demand Deposits increasing more than 60% during the quarter versus the same period last year, while total deposits grew to over $1.7 billion. This effort blunted margin pressure during the quarter and should continue to reduce the deposit volatility that often accompanies Fed action in response to changing economic trends.

Another significant development the Bank actively engaged in during the COVID-19 pandemic was the federally-funded Paycheck Protection Program (PPP). Our early decision to participate was driven by recognition of the vital role this program could play in supporting the economic viability of our business clients. While the Bank has enjoyed some revenue from the program, primarily through monthly interest rate accruals and the "true-up" fee when PPP loans are forgiven, we view this income as unique to the time and tangential to our core business. This said, we remain actively involved with clients on the second round of PPP financing and anticipate loan volume may well approach levels we saw during its initial phase.

In addition to these activities, the Company's newly created Orange Wealth Management initiative, which includes our private bank, trust, and HVIA advisory business, saw revenue grow nearly 19%, to $2.3 million, versus the same quarter last year. This growth stemmed primarily from a $41 million increase, to $1.2 billion, in assets under management (AUM). To further support this program, the Bank hired veteran banker Ron Coccaro, who will be responsible for identifying and pursuing new growth and sales opportunities. We expect growth and opportunities to result from broader adoption and integration of our Wealth Solutions service, which combines best-in-class technology with top rated financial advisors to give our clients an accurate, comprehensive picture of their financial health and strategies for long-term growth and security.

We are also currently building new branches in the Bronx and Nanuet, and anticipate opening the former in late June or early July, with the latter to follow shortly thereafter. We view these locations as very natural and logical extensions for the Bank, with our regional footprint and experience giving us confidence in their potential. We look forward to these openings and further expanding the Bank's reach.

Orange Bank's successful 127-year operating history has been characterized by cautious lending standards and thoughtful, patient growth. This legacy guides our decision making today, with any contemplated changes or additions to our service offerings evaluated in terms of their impact on our community, clients, and investors. Our record first quarter 2021 results indicate we are succeeding on all three fronts, and provide a strong foundation for the year ahead. Rest assured we will remain vigilant in our efforts and continue to build on these accomplishments."

First Quarter 2021 Financial Review

Net Income

Net income for the first quarter of 2021 was $5.03 million, compared to net income of $2.48 million for the first quarter of 2020, an increase of $2.55 million, or 105%. The increase was driven primarily by growth in net interest income and a concurrent decrease in the provision for loan losses, partially offset by an increase in non-interest expense.

Net Interest Income

For the three months ended March 31, 2021, net interest income increased $2.4 million, or 21.0%, versus the same period last year.

Total interest income increased $2.1 million, or 16.6%, for the three months ended March 31, 2021 versus the corresponding period last year. This increase in interest income was primarily due to loan growth and fees associated with PPP loan forgiveness.

Total interest expense decreased $267 thousand in the first quarter of 2021, to $1.0 million, compared to $1.3 million in the first quarter of the prior year. The decrease resulted from a $487 thousand reduction in deposit interest expense partially offset by an increase in interest expense of $230 thousand due to the subordinated debt issued in September 2020. Lower interest expense on deposits was consistent with the reduction of the Fed Funds rate in the first quarter of 2020 in response to the COVID-19 pandemic.

Provision for Loan Losses

The Company recognized a $66 thousand provision for loan losses for the three months ended March 31, 2021, well below the $1.2 million provision for loan losses recorded in the same period in the prior year. The lower provision reflects significantly improved credit metrics and loan deferrals. The allowance for loan losses to total loans was 1.32% as of March 31, 2021. Excluding PPP loans, the ratio was 1.46% as of March 31, 2021.

Non-Interest Income

Non-interest income was $2.9 million during the first quarter of 2021, an increase of $351 thousand, or 13.8%, versus the first quarter of 2020. The increase was a result of continued growth in the Bank's trust operations and HVIA's asset management activities.

Non-Interest Expense

Non-interest expense was $10.3 million during the first quarter of 2021, an increase of $725 thousand, or 7.6%, versus the first quarter of 2020 due to the Bank's continued investment in growth. Continued investment to support growth was comprised primarily of a $362,000 increase in salaries, a $264,000 increase in information technology costs and a $120,000 increase in deposit insurance expense resulting from the significant growth in deposit balances. The efficiency ratio improved 701 basis points during the first quarter of 2021, to 62.02%, compared with the same period last year.

Income Tax Expense

Income tax accrual for the three months ended March 31, 2021 was $1.2 million versus $628 thousand for the same period in 2020 due to the increase in income before income tax expense. The effective tax rates for the two periods were 19.6% and 20.2%, respectively.

Financial Condition

Total consolidated assets increased $243.8 million, or 14.6%, from $1.66 billion at December 31, 2020 to $1.91 billion at March 31, 2021. The increase in total consolidated assets reflected increases in cash and due from banks, loans receivable and investments.

Total cash and due from banks increased from $121.2 million at December 31, 2020 to $253.1 million at March 31, 2021, an increase of $131.9 million, or 108.8%. The increase in cash was primarily due to increases in deposit account balances driven by seasonal increases in municipal deposits, ongoing success attracting business account assets, and government efforts to increase liquidity in the economy.

Total investments increased $29.3 million from $330.1 million at December 31, 2020 to $359.4 million at March 31, 2021. The increase was primarily in mortgage backed and municipal securities.

Total loans increased from $1.15 billion at December 31, 2020 to $1.23 billion at March 31, 2021, an increase of $80.0 million. This increase was due primarily to a $51.9 million increase in PPP loans.

Total deposits increased $244.3 million to $1.73 billion at March 31, 2021, from $1.49 billion at December 31, 2020. While the increase was primarily related to increases in business accounts, it included $80.6 million of seasonal inflows of government and municipal deposits attributable to the cyclical nature of real estate tax collections.

Borrowed funds of $22.3 million at March 31, 2021 was unchanged from December 31, 2020.

Stockholders' equity remained relatively flat at $135.1 million at March 31, 2021 as the $4.1 million increase in retained earnings during the first quarter of 2021 was offset by the $4.4 million decline in AOCI, for the same period, resulting from the impact of higher interest rates on the market value of investments.

At March 31, 2021, the Bank maintained capital ratios in excess of regulatory standards for well capitalized institutions. The Bank's Tier 1 capital to average assets ratio was 8.19%, both the common equity and Tier 1 capital to risk weighted assets were 12.39% and the total capital to risk weighted assets ratio was 13.64%.

Loan Quality

At March 31, 2021, the Bank had total non-accrual loans of $2.0 million, which included $959.0 thousand of Troubled Debt Restructured Loans ("TDRs"). This total was unchanged from year end 2020. Accruing loans delinquent greater than 30 days were $1.9 million as of March 31, 2021, compared to $1.8 million at December 31, 2020. The following table shows the current status of loans deferred as a result of the COVID-19 pandemic.

Orange Bank & Trust Co.
Summary of Loan Portfolio Segments at 03/31/21 and Deferments to Date (unaudited)
(dollars in thousands)

				Total Deferments as of March 31, 2021
Industry Classification	March 31, 2021 Balance	Loan Count	% of Total Loans	Outstanding Balance	Loan Count	Deferred %
Real Estate and Rental Leasing	$481,223	480	38.9%	$6,677	5	1.4%
Healthcare and Social Assistance	108,874	647	8.8%	7,484	6	6.9%
Construction	77,430	98	6.3%	-	0	0.0%
Retail Trade	43,962	85	3.6%	-	0	0.0%
Management of Companies/Enterprise	35,725	17	2.9%	-	0	0.0%
Wholesale Trade	33,522	74	2.7%	-	0	0.0%
Manufacturing	43,728	103	3.5%	-	0	0.0%
Hotel / Motel	25,551	10	2.1%	7,588	3	29.7%
Professional, Scientific, and Technical Services	17,812	166	1.4%	52	2	0.3%
Finance and Insurance	18,540	64	1.5%	-	0	0.0%
Contractors	15,004	107	1.2%	-	0	0.0%
Educational Services & Child Care	14,065	33	1.1%	-	0	0.0%
Administrative and Management	14,666	88	1.2%	6,882	2	46.9%
Food Service	17,338	31	1.4%	650	3	3.7%
Art, Entertainment, and Recreation	3,412	10	0.3%	2,878	1	84.3%
Transportation and Warehousing	4,708	34	0.4%	-	0	0.0%
Residential Real Estate & Other	158,398	1,320	12.8%	-	0	0.0%
PPP Loans	121,779	780	9.9%	-	0	0.0%
Total system loan balances	$1,235,737	4,147	100.0%	$32,211	22	2.6%
Net deferred & unapplied	(4,109)
Total Loans	$1,231,628
				Total Deferments as of March 31, 2021
Loan Portfolio Category	March 31, 2021 Balance	Loan Count	% of Total Loans	Outstanding Balance	Loan Count	Deferred %
CRE:
Multifamily	$157,956	90	12.8%	$2,367	1	1.5%
Non-owner occupied	381,004	369	30.8%	14,779	6	3.9%
Owner occupied	171,314	190	13.9%	14,269	8	8.3%
Construction, development, land	76,841	24	6.2%	-	0	0.0%
C&I	236,731	1,819	19.2%	796	7	0.3%
PPP Loans	121,779	780	9.9%	-	0	0.0%
Consumer:
Residential	71,660	546	5.8%	-	0	0.0%
Non-residential	18,452	329	1.5%	-	0	0.0%
Total system loan balances	$1,235,737	4,147	100.0%	$32,211	22	2.6%
Net deferred & unapplied	(4,109)
Total Loans	$1,231,628

At the outset of the pandemic, management identified certain industries, including hospitality, healthcare, and retail, it viewed as most susceptible to stress from a prolonged slowdown in the economy. Notwithstanding perceived industry risks, portfolio concentration and exposure across these segments is modest. Notably, Lodging and Food Services, which broadly reflect our exposure to hotels, food and beverage, constitute $42.9 million, or 3.5%, of our loan portfolio. At quarter end, these categories accounted for 19.3% of total loans on payment deferral.

Management continues to evaluate performance trends across industry groups to assess underlying business and liquidity risks due to the economic impacts of COVID-19. While the Bank has continued to provide relief from debt service through forbearance agreements, its focus has shifted toward the resumption of loan payments, as management believes clients in need of deferral have largely been accommodated at this time. Most borrowers requesting deferral early in the cycle resumed scheduled repayment of their loan obligations at the end of their initial 90-day deferral period. Deferred loans at March 31, 2021 were $32.2 million, or 2.6%, of our portfolio, compared with $310.4 million, or 29.5%, of our loan portfolio at June 30, 2020.

Forward Looking Statements

Certain statements contained herein are "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 "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward looking statements are subject to numerous risks and uncertainties, including, but not limited to, those related to the real estate and economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity. Further, given its ongoing and dynamic nature, it is difficult to predict what the continuing effects of the COVID-19 pandemic will have on our business and results of operations. The pandemic and related local and national economic disruption may, among other effects, continue to result in a material adverse change for the demand for our products and services; increased levels of loan delinquencies, problem assets and foreclosures; branch disruptions, unavailability of personnel and increased cybersecurity risks as employees work remotely.

The Company wishes to caution readers not to place undue reliance on any such forward looking statements, which speak only as of the date made. The Company wishes to advise readers that the factors listed above could 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. The Company does not undertake and specifically declines any obligation to publicly release the results of any revisions that 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.

About Orange County Bancorp, Inc.

Orange County Bancorp, Inc. is the parent company of Orange Bank & Trust Company and Hudson Valley Investment Advisors, Inc. Orange Bank & Trust Company is an independent bank that began with the vision of 14 founders over 125 years ago. It has grown through conservative banking practices, ongoing innovation, and an unwavering commitment to its community and business clientele to over $1.9 billion in Total Assets. In recent years, Orange Bank & Trust Company has added branches in Rockland and Westchester Counties. Hudson Valley Investment Advisors, Inc. is a Registered Investment Advisor in Goshen, NY. It was founded in 1996 and acquired by the Company in 2012. For additional information, visit orangebanktrust.com or hviaonline.com

For further information:
Robert L. Peacock
EVP Chief Financial Officer
rpeacock@orangebanktrust.com
Phone: (845) 341-5005

ORANGE COUNTY BANCORP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CONDITION
(Dollar Amounts in thousands except per share data)

		March 31, 2021				December 31, 2020
ASSETS
Cash and due from banks		$	253,091			$	121,232
Investment securities - available-for-sale			359,372				330,105
Restricted investment in bank stocks			1,752				1,449
Loans			1,231,628				1,152,738
Allowance for loan losses			(16,283	)			(16,172	)
Loans, net			1,215,345				1,136,566
Net Premises and equipment			14,048				14,017
Accrued interest receivable			7,319				6,295
Bank owned life insurance			28,691				28,520
Goodwill			5,359				5,359
Intangible assets			1,892				1,963
Other assets			21,885				19,430
TOTAL ASSETS		$	1,908,754			$	1,664,936
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest bearing		$	598,493			$	521,093
Interest bearing			1,135,066				968,201
Total deposits			1,733,559				1,489,294
FHLB advances			-				-
Note payable			3,000				3,000
Subordinated notes, net of issuance costs			19,340				19,323
Accrued expenses and other liabilities			17,774				17,896
TOTAL LIABILITIES			1,773,673				1,529,513
STOCKHOLDERS' EQUITY
Common stock, $0.50 par value; 15,000,000 shares authorized;
4,533,304 issued; 4,490,973 and 4,483,102 outstanding,
at March 31, 2021 and December 31, 2020, respectively			2,266				2,266
Surplus			84,775				85,111
Retained Earnings			51,817				47,683
Accumulated other comprehensive income (loss), net of taxes			(2,559	)			1,819
Treasury stock, at cost; 42,331 and 50,202 shares at March 31,
2021 and December 31, 2020, respectively			(1,218	)			(1,456	)
TOTAL STOCKHOLDERS' EQUITY			135,080				135,423
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	1,908,754			$	1,664,936

Note: There were minor changes made to the previously reported December 31, 2020 balance sheet related to corrections for the treatment of deferred costs on loans.

ORANGE COUNTY BANCORP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(Dollar Amounts in thousands except per share data)

		For the Three Months Ended March 31,
		2021				2020
INTEREST INCOME
Interest and fees on loans		$	13,228			$	11,002
Interest on investment securities:
Taxable			1,127				1,335
Tax exempt			363				126
Interest on Federal funds sold and other			44				180
TOTAL INTEREST INCOME			14,762				12,643
INTEREST EXPENSE
Interest on savings and NOW accounts			592				956
Interest on time deposits			158				281
Interest on FHLB advances			-				10
Interest on note payable			42				42
Interest on subordinated notes			230				-
TOTAL INTEREST EXPENSE			1,022				1,289
NET INTEREST INCOME			13,740				11,354
Provision for loan losses			66				1,200
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES			13,674				10,154
NONINTEREST INCOME
Service charges on deposit accounts			175				208
Trust income			1,124				1,038
Investment advisory income			1,176				901
Earnings on bank owned life insurance			171				165
Other			245				229
TOTAL NONINTEREST INCOME			2,892				2,541
NONINTEREST EXPENSE
Salaries			4,547				4,185
Employee benefits			1,126				1,148
Occupancy expense			965				938
Professional fees			907				584
Directors' fees and expenses			242				293
Computer software expense			1,058				794
FDIC assessment			289				169
Advertising expenses			283				314
Advisor expenses related to trust income			121				155
Telephone expenses			133				128
Intangible amortization			71				71
Other			574				811
TOTAL NONINTEREST EXPENSE			10,316				9,591
Income before income taxes			6,250				3,104
Provision for income taxes			1,225				628
NET INCOME		$	5,025			$	2,476
Basic and diluted earnings per share		$	1.12			$	0.55
Weighted average shares outstanding			4,483,139				4,510,420

Note: There were minor changes made to the previously reported March 31, 2020 income statement related to corrections for the treatment of deferred costs on loans.

Orange County Bancorp, Inc. and Subsidiaries
Net Interest Margin Analysis (unaudited)
(Dollar Amounts in thousands)

		Three Months Ended March 31,
		2021												2020
		Average Balance				Interest				Average Rate				Average Balance				Interest				Average Rate
Assets:
Loans Receivable (net of PPP)		$	1,084,848			$	12,036				4.50	%		$	915,124			$	11,001				4.83	%
PPP Loans			94,479				1,192				5.12	%			-				-				0.00	%
Investment securities			340,682				1,392				1.66	%			258,327.14				1,462				2.28	%
Due from banks			177,393				44				0.10	%			58,187				180				1.24	%
Other			1,520				98				26.24	%			1,275				-				0.00	%
Total interest earning assets			1,698,923				14,762				3.52	%			1,232,913				12,643				4.12	%
Non-interest earning assets			81,012												74,808
Total assets		$	1,779,934											$	1,307,721
Liabilities and equity:
Interest-bearing demand accounts		$	262,565			$	82				0.13	%		$	201,566			$	103				0.21	%
Money market accounts			539,295				459				0.35	%			403,893				774				0.77	%
Savings accounts			158,893				51				0.13	%			124,085				78				0.25	%
Certificates of deposit			90,796				158				0.71	%			87,996				281				1.28	%
Total interest-bearing deposits			1,051,550				750				0.29	%			817,539				1,237				0.61	%
FHLB Advances			-				-				0.00	%			2,326				10				1.77	%
Note payable			3,000				42				5.68	%			3,000				42				5.62	%
Subordinated notes			19,335				230				4.75	%			-				-				0.00	%
Total interest bearing liabilities			1,073,885				1,022				0.39	%			822,865				1,289				0.63	%
Non-interest bearing demand accounts			552,441												345,146
Other non-interest bearing liabilities			19,057												16,867
Total liabilities			1,645,383												1,184,879
Total shareholders' equity			134,552												122,842
Total liabilities and shareholders' equity		$	1,779,934											$	1,307,721
Net interest income						$	13,740											$	11,354
Interest rate spread 1											3.14	%											3.50	%
Net interest margin 2											3.28	%											3.70	%
Average interest earning assets to interest-bearing liabilities			158.2	%											149.8	%

Notes:

1 The Interest rate spread is the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities
2 Net interest margin is the annualized net interest income divided by average interest-earning assets

Orange County Bancorp, Inc. and Subsidiaries
Net Interest Margin Analysis (unaudited)
Dollar Amounts in thousands)

		Twelve Months Ended December 31,
		2020												2019
		Average Balance				Interest				Average Rate				Average Balance				Interest				Average Rate
Assets:
Loans Receivable (net of PPP)		$	963,333			$	45,487				4.72	%		$	819,205			$	40,803				4.98	%
PPP Loans			59,205				2,034				3.44	%			-				-				0.00	%
Investment securities			295,303				5,575				1.89	%			254,388				6,373				2.51	%
Due from banks			132,840				294				0.22	%			40,677				853				2.10	%
Other			1,405				70				4.99	%			1,436				92				6.41	%
Total interest earning assets			1,452,086 #				53,462				3.68	%			1,115,705				48,121				4.31	%
Non-interest earning assets			75,142												68,602
Total assets		$	1,527,227											$	1,184,308
Liabilities and equity:
Interest-bearing demand accounts		$	214,012			$	414				0.19	%		$	181,446			$	300				0.17	%
Money market accounts			480,149				2,709				0.56	%			346,776				2,687				0.77	%
Savings accounts			137,906				266				0.19	%			126,056				304				0.24	%
Certificates of deposit			90,232				917				1.02	%			92,878				1,221				1.31	%
Total interest-bearing deposits			922,299				4,306				0.47	%			747,155				4,512				0.60	%
FHLB Advances			578				10				1.77	%			8,506				147				1.73	%
Note payable			3,000				160				5.35	%			3,028				181				5.97	%
Subordinated notes			4,918				246				5.00	%			-				-				0.00	%
Total interest bearing liabilities			930,796				4,723				0.51	%			758,689				4,840				0.64	%
Non-interest bearing demand accounts			449,454												296,360
Other non-interest bearing liabilities			17,469												13,787
Total liabilities			1,397,718												1,068,836
Total shareholders' equity			129,509												115,472
Total liabilities and shareholders' equity		$	1,527,227											$	1,184,308
Net interest income						$	48,739											$	43,281
Interest rate spread 1											3.17	%											3.68	%
Net interest margin 2											3.36	%											3.88	%
Average interest earning assets to interest-bearing liabilities			156.0	%											147.1	%

Notes:

1 The Interest rate spread is the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities
2 Net interest margin is the annualized net interest income divided by average interest-earning assets

Orange County Bancorp, Inc. and Subsidiaries
Ratios and Other Data (unaudited)
(Dollar Amounts in thousands)

		At or For the Three Months Ended March 31, (1)								At or For the Year Ended December 31,
		2021				2020				2020				2019
Performance Ratios:
Return on average assets			1.13	%			0.76	%			0.77	%			0.97	%
Return on average equity			14.94	%			8.06	%			9.11	%			10.02	%
Interest rate spread (2)			3.09	%			3.48	%			3.18	%			3.68	%
Net interest margin (3)			3.24	%			3.68	%			3.36	%			3.88	%
Efficiency ratio (4)			62.02	%			69.03	%			66.87	%			68.73	%
Dividend payout ratio (5)			17.72	%			36.19	%			30.70	%			31.23	%
Non-interest income to average total assets			0.65	%			0.78	%			0.75	%			0.83	%
Non-interest expenses to average total assets			2.32	%			2.93	%			2.64	%			3.08	%
Average interest-earning assets to average interest-bearing liabilities			158.20	%			149.83	%			155.81	%			146.90	%
Average equity to average total assets			7.56	%			9.39	%			8.41	%			9.68	%
Asset Quality Ratios:
Non-performing assets to total assets			0.13	%			0.25	%			0.15	%			0.18	%
Non-performing loans to total loans			0.20	%			0.36	%			0.22	%			0.25	%
Allowance for loan losses to non-performing loans			667.55	%			401.50	%			641.23	%			550.20	%
Allowance for loan losses to total loans			1.32	%			1.44	%			1.41	%			1.38	%
Net (charge-offs) recoveries to average outstanding loans during the period			0.00	%			0.00	%			0.15	%			0.07	%
Capital Ratios:(6)
Total capital (to risk-weighted assets)			13.64	%			13.54	%			13.38	%			13.77	%
Tier 1 capital (to risk-weighted assets)			12.39	%			12.29	%			12.13	%			12.52	%
Common equity tier 1 capital (to risk-weighted assets)			12.39	%			12.29	%			12.13	%			12.52	%
Tier 1 capital (to average assets)			8.19	%			9.13	%			8.08	%			9.39	%

(1) Annualized for the three-month periods ended March 31, 2021and 2020.
(2) Represents the difference between the weighted-average yield on interest-earning assets and the weighted-average cost of interest-bearing liabilities for the periods.
(3) The net interest margin represents net interest income as a percent of average interest-earning assets for the periods.
(4) The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income.
5) The dividend payout ratio represents dividends paid per share divided by net income per share.
(6) Ratios are for the Bank only.

Orange County Bancorp, Inc. and Subsidiaries
Selected Operating Data (unaudited)
(Dollar Amounts in thousands)

		Three months ended								Year ended
		March 31,								December 31,
		2021				2020				2020				2019
Interest income		$	14,762			$	12,643			$	53,461			$	48,121
Interest expense			1,022				1,289				4,722				4,840
Net interest income			13,740				11,354				48,739				43,281
Provision for loan losses			66				1,200				5,413				2,195
Net interest income after provision for loan losses			13,674				10,154				43,326				41,086
Noninterest income			2,892				2,541				11,423				9,814
Noninterest expenses			10,316				9,591				40,231				36,491
Income before income taxes			6,250				3,104				14,518				14,409
Provision for income taxes			1,225				628				2,839				2,928
Net income		$	5,025			$	2,476			$	11,679			$	11,481
Earnings per common share:
Basic		$	1.12			$	0.55			$	2.59			$	2.56
Book value per share			30.08				27.96				29.89				26.85
Net tangible book value per share (1)			28.46				26.29				28.26				25.16
Weighted average common shares - basic			4,483,139				4,510,420				4,508,508				4,484,317
Outstanding common shares - basic			4,490,973				4,518,128				4,483,102				4,504,389

(1) Net tangible book value represents the amount of your total tangible assets reduced by our total liabilities. Tangible assets are calculated by reducing total assets, as defined by GAAP, by $5,358 in goodwill and $1,892, and $2,178 in other intangible assets for the three months ended March 31, 2021 and 2020, respectively and $1,964, and $2,249 in other intangible assets for years ended December 31, 2020 and 2019, respectively.

Orange County Bancorp, Inc. and Subsidiaries
Loan Composition (unaudited)
(Dollar Amounts in thousands)

	At March 31,		At December 31,
	2021		2020		2019
	Amount	Percent	Amount	Percent	Amount	Percent
Commercial and industrial (a)	$355,415	28.86%	$299,049	25.94%	$222,111	24.90%
Commercial real estate	709,761	57.63%	698,130	60.56%	534,407	59.90%
Commercial real estate construction	76,570	6.22%	63,544	5.51%	56,412	6.32%
Residential real estate	58,123	4.72%	57,941	5.03%	65,290	7.32%
Home equity	13,197	1.07%	13,960	1.21%	11,668	1.31%
Consumer	18,563	1.51%	20,114	1.74%	2,236	0.25%
Total loans	1,231,628	100.00%	1,152,738	100.00%	892,124	100.00%
Allowance for loan losses	16,283		16,172		12,275
Total loans, net	$1,215,345		$1,136,566		$879,849
(a) - Inlcudes PPP loans of:	$121,779		$69,874		$-

Orange County Bancorp, Inc. and Subsidiaries
Deposits by Account Type (unaudited)
(Dollar Amounts in thousands)

The following table sets forth the distribution of total deposits by account type at the dates indicated.

		At March 31,												At December 31,
		2021												2020												2019
		Amount				Percent				Average Rate				Amount				Percent				Average Rate				Amount				Percent				Average Rate
Noninterest-bearing demand accounts		$	598,493				34.52	%			0.00	%		$	521,093				34.99	%			0.00	%		$	335,469				30.97	%			0.00	%
Interest bearing demand accounts			276,987				15.98	%			0.13	%			236,951				15.91	%			0.15	%			166,907				15.41	%			0.22	%
Money market accounts			599,127				34.56	%			0.31	%			483,044				32.43	%			0.36	%			368,799				34.05	%			0.87	%
Savings accounts			168,934				9.74	%			0.10	%			157,007				10.54	%			0.12	%			123,330				11.39	%			0.25	%
Certificates of Deposit			90,019				5.19	%			0.66	%			91,199				6.12	%			0.75	%			88,657				8.19	%			1.36	%
Total		$	1,733,559				100.00	%			0.17	%		$	1,489,294				100.00	%			0.20	%		$	1,083,162				100.00	%			0.47	%

Orange County Bancorp, Inc. and Subsidiaries
Non-performing Assets (unaudited)
(Dollar Amounts in thousands)

		At March 31,				At December 31,
		2021				2020				2019
Non-accrual loans:
Commercial and industrial		$	-			$	-			$	502
Commercial real estate			1,345				1,345				959
Commercial real estate construction			-				-				-
Residential real estate			655				657				88
Home equity			-				-				-
Consumer			-				-				-
Total non-accrual loans 1			2,000				2,002				1,549
Accruing loans 90 days or more past due:
Commercial and industrial			345				457				215
Commercial real estate			-				-				-
Commercial real estate construction			-				-				-
Residential real estate			2				2				416
Home equity			-				-				51
Consumer			93				61				-
Total loans 90 days or more past due			439				520				682
Total non-performing loans			2,439				2,522				2,231
Other real estate owned			-				-				-
Other non-performing assets			-				-				-
Total non-performing assets		$	2,439			$	2,522			$	2,231
Ratios:
Total non-performing loans to total loans			0.20	%			0.22	%			0.25	%
Total non-performing loans to total assets			0.13	%			0.15	%			0.18	%
Total non-performing assets to total assets			0.13	%			0.15	%			0.18	%
1 - Includes non-accruing TDRs:		$	959			$	959			$	959

SOURCE: Orange County Bancorp, Inc.

View source version on accesswire.com:
https://www.accesswire.com/644067/Orange-County-Bancorp-Inc-Announces-Record-First-Quarter-2021-Results

FAQ

What was the net income for OCBI in Q1 2021?

Orange County Bancorp reported a net income of $5.03 million for Q1 2021.

How much did average loans increase for OCBI in Q1 2021?

Average loans for OCBI increased by 18.5% year-over-year to $1.1 billion.

What was the return on common equity for OCBI in Q1 2021?

The return on common equity for OCBI rose to 14.9% in Q1 2021.

How much did average demand deposits grow for OCBI in Q1 2021?

Average demand deposits grew by 60.1% year-over-year to $552.4 million.

What was the total asset growth for OCBI in Q1 2021?

Total assets for OCBI grew by 14.6% to $1.9 billion in Q1 2021.