PSB Holding Corp. Reports First Quarter 2021 Results

Rhea-AI Summary

PSB Holding Corp. (OTC-QX: PSBP) reported a net income of $1.21 million ($0.79 per diluted share) for Q1 2021, a decline from $1.44 million in Q4 2020 but up from $940,000 in Q1 2020. The decrease from Q4 2020 was attributed to lower mortgage banking activity amid rising long-term rates. However, net income rose 29.1% year-over-year, benefiting from fees from the PPP and increased investment balances. Total assets reached $571.7 million, while deposits grew to $473.7 million. Non-performing assets remained low at 0.34% of total assets.

Positive

• Net income increased by $274,000 or 29.1% compared to Q1 2020.
• Amortized net fees from PPP loans totaled $667,000.
• Total assets rose by $22.4 million (4.1%) from Q4 2020.
• Deposits grew by 5.4% from Q4 2020 and 29.1% from Q1 2020.

Negative

• Net income decreased by $229,000 from Q4 2020.
• Gain on sale of loans decreased by $242,000 quarter-over-quarter.
• Net interest margin declined from 3.70% in Q1 2020 to 3.42% in Q1 2021.

PRESTON, Md., April 28, 2021 /PRNewswire/ -- PSB Holding Corp. (OTC-QX: PSBP), the parent company of Provident State Bank, Inc. ("Provident"), reported net income of $1.21 million ($.79 per diluted common share) for the first quarter ended March 31, 2021, compared to $1.44 million ($.94 per diluted common share) for the fourth quarter 2020 and $940,000 ($.61 per diluted common share) for the first quarter 2020.

When comparing net income for the first quarter 2021 to the fourth quarter 2020, net income decreased $229,000 primarily as a result of a decrease in mortgage banking activity driven by increasing long-term rates during the first quarter 2021.  Specifically, gain on sale of loans decreased $242,000 on a linked-quarter basis.

When comparing net income for the first quarter of 2021 to the first quarter of 2020, net income increased $274,000 or 29.1%.  The increase was largely the result of earned net fees on loans originated under the Small Business Administration's Payroll Protection Program ("PPP"), which began in April 2020, an increase in average investment balances (including interest-bearing deposits and federal funds sold) and an increase in gain on sale of loans.  These positive influences on net income were offset by pressure on the net interest margin.  Amortized net fees on PPP loans for the first quarter 2021 totaled $667,000.  Average investment balances increased from $71.58 million during the first quarter 2020 to $142.30 million during the first quarter 2021 with an average yield of 1.21% in first quarter 2021 compared to 2.15% in the first quarter 2020.  Gain on sale of loans increased $97,000.  The net interest margin declined from 3.70% during the first quarter 2020 to 3.42% during the first quarter 2021.  The net interest margin, exclusive of amortized net fees on PPP loans, was 3.09% during the first quarter 2021.  Average earning assets increased from $435.18 million in 2020 to $527.13 million, inclusive of average PPP loans of $41.41 million, in 2021.  The increase in gain on sale of loans and the decline in the net interest margin were the result of a lower interest rate environment pursued by the Federal Reserve to stabilize the economy during the pandemic.

Assets totaled $571.7 million at March 31, 2021, increasing $22.4 million or 4.1% compared to December 31, 2020 and $109.2 million or 23.6% compared to March 31, 2020. Growth in assets was driven primarily by growth in deposits as government stimulus increased customer liquidity.  Deposits totaled $473.7 million at March 31, 2021 compared to $449.4 million at December 31, 2020 and $367.1 million at March 31, 2020, representing growth of 5.4% and 29.1%, respectively.  Gross loans decreased $3.1 million to $383.0 million, a 1.0% decrease as compared to December 31, 2020.  Gross loans increased $22.1 million or 6.1% compared to March 31, 2020 primarily as a result of PPP loan origination activity.  As of March 31, 2021, non-performing assets and past due loans were .34% of total assets. 

President and Chief Executive Officer Melissa Quirk commented, "Performance continued to remain strong with our fourth consecutive quarter of earnings in excess of $1.1 million, a first for our company. Our strong performance during this period was the result of our proactive initiative to participate in the PPP and our ability to maintain core business activities during an unprecedented pandemic.  We remain grateful for the commitment of our staff and the patience of our customers during this extraordinary time."

PSB Holding Corp. is the holding company of Provident State Bank, Inc., a full service financial institution serving the eastern shore of Maryland since 1904. Provident State Bank, Inc. has ten locations in Preston, Federalsburg, Ridgely, Denton, Easton-Elliot Road, Easton-Harrison Street, Secretary, Cambridge, Salisbury and Lewes (Delaware).  For more information on PSB Holding Corp. and Provident State Bank, Inc., visit www.providentstatebank.com.

Forward-Looking Statements

Forward-looking statements relating to PSB Holding Corp. and its subsidiary, Provident State Bank, Inc. may include plans, strategies, objectives, expectations, intentions and adequacy of resources.  All statements other than statements of historical fact, including, without limitation, statements regarding business strategy, future events, activities, performance, and plans and objectives for future operations, are forward-looking statements.  Therefore, the illustrative value of forward-looking statements made in or pursuant to this press release should not, under any circumstances, be considered a guaranty or promise that such future events, activities, occurrences or performances will take place.

CONDENSED CONSOLIDATED BALANCE SHEETS
	(unaudited)				(unaudited)		Percent Change from
	Mar 31, 2021		Dec 31, 2020		Mar 31, 2020		Dec 31, 2020		Mar 31, 2020
Assets
Cash and cash equivalents	$    44,956,382		$    29,162,136		$    19,641,503		54.2%		128.9%
Investment securities	122,078,560		111,930,314		59,796,786		9.1%		104.2%
Loans held for sale	1,414,221		2,367,448		1,988,172		-40.3%		-28.9%
Loans receivable	383,048,584		386,189,190		360,979,154		-0.8%		6.1%
Less allowance for loan losses	3,675,068		3,583,204		3,409,206		2.6%		7.8%
Loans, net of allowance for loan losses	379,373,516		382,605,986		357,569,948		-0.8%		6.1%
Property and equipment	8,196,751		8,401,637		9,694,554		-2.4%		-15.4%
Bank-owned life insurance	8,712,098		8,656,454		8,471,644		0.6%		2.8%
Lease assets	2,443,106		2,508,345		2,675,508		-2.6%		-8.7%
Accrued interest receivable	1,484,262		1,616,775		1,314,693		-8.2%		12.9%
Other assets	3,044,696		2,103,866		1,315,594		44.7%		131.4%
Total assets	$  571,703,592		$  549,352,961		$  462,468,402		4.1%		23.6%
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing	$  210,026,953		$  171,855,568		$  139,853,993		22.2%		50.2%
Interest-bearing	263,682,755		277,526,516		227,202,014		-5.0%		16.1%
Total deposits	473,709,708		449,382,084		367,056,007		5.4%		29.1%
Repurchase agreements	11,891,020		15,528,356		7,447,748		-23.4%		59.7%
FHLB advances and other borrowing	32,801,481		31,078,123		38,907,389		5.5%		-15.7%
Lease liabilities	2,639,068		2,685,641		2,839,341		-1.7%		-7.1%
Other liabilities	2,016,381		1,934,558		1,277,975		4.2%		57.8%
Total liabilities	523,057,658		500,608,762		417,528,460		4.5%		25.3%
Stockholders' equity	48,645,934		48,744,199		44,939,942		-0.2%		8.2%
Total liabilities and equity	$  571,703,592		$  549,352,961		$  462,468,402		4.1%		23.6%
Book value per common share	$               31.76		$               31.82		$               29.34		-0.2%		8.2%

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
	Three Months Ended										Percent Change from
	Mar 31, 2021		Dec 31,2020		Sep 30, 2020		Jun 30, 2020		Mar 31, 2020		Dec 31, 2020		Mar 31, 2020
Interest income
Loans, including fee income	$ 4,763,112		$ 4,988,220		$ 4,796,814		$ 4,758,983		$ 4,591,832		-4.5%		3.7%
Investment securities	423,879		334,830		305,329		332,732		346,973		26.6%		22.2%
Other interest income	6,144		10,291		7,190		5,014		38,468		-40.3%		-84.0%
Total interest income	5,193,135		5,333,341		5,109,333		5,096,729		4,977,273		-2.6%		4.3%
Interest expense
Deposits	534,280		570,013		616,225		657,010		707,952		-6.3%		-24.5%
Repurchase agreements	1,079		1,298		782		1,036		4,945		-16.9%		-78.2%
FHLB advances	175,472		187,295		195,442		204,654		211,894		-6.3%		-17.2%
Other borrowings	34,937		36,686		38,461		39,834		40,298		-4.8%		-13.3%
Total interest expense	745,768		795,292		850,910		902,534		965,089		-6.2%		-22.7%
Net interest income	4,447,367		4,538,049		4,258,423		4,194,195		4,012,184		-2.0%		10.8%
Provision for loan losses	90,000		20,000		130,000		180,000		118,500		350.0%		-24.1%
Net interest income after provision	4,357,367		4,518,049		4,128,423		4,014,195		3,893,684		-3.6%		11.9%
Noninterest income
Service charges	417,139		416,823		412,317		374,471		423,478		0.1%		-1.5%
Gain on sale of loans	260,464		502,302		397,309		243,830		163,444		-48.1%		59.4%
Gain on sale of securities	-		18,557		-		25,470		-		-100.0%		NM
Other noninterest income	53,264		66,597		69,745		71,046		74,609		-20.0%		-28.6%
Total noninterest income	730,867		1,004,279		879,371		714,817		661,531		-27.2%		10.5%
Noninterest expense
Salaries and benefits	1,808,276		1,905,737		1,843,439		1,706,479		1,771,823		-5.1%		2.1%
Occupancy	513,208		507,121		488,246		492,731		521,550		1.2%		-1.6%
Data processing and software	312,620		294,390		287,995		268,884		234,771		6.2%		33.2%
Other noninterest expense	839,505		894,306		715,565		746,696		783,748		-6.1%		7.1%
Total noninterest expense	3,473,609		3,601,554		3,335,245		3,214,790		3,311,892		-3.6%		4.9%
Net income before tax	1,614,625		1,920,774		1,672,549		1,514,222		1,243,323		-15.9%		29.9%
Tax expense	401,375		478,399		420,666		376,544		303,494		-16.1%		32.3%
Net income	$1,213,250		$ 1,442,375		$ 1,251,883		$ 1,137,678		$     939,829		-15.9%		29.1%
Net income per share	$         0.79		$           0.94		$           0.82		$           0.74		$           0.61		-15.9%		29.1%

 

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SOURCE PSB Holding Corp.

FAQ

What was PSB Holding Corp.'s net income for Q1 2021?

PSB Holding Corp. reported a net income of $1.21 million for Q1 2021.

How does PSB Holding Corp.'s Q1 2021 performance compare to Q4 2020?

Net income for Q1 2021 decreased by $229,000 compared to Q4 2020.

What contributed to the increase in PSB Holding Corp.'s net income year over year?

The increase was mainly due to fees from the PPP and higher investment balances.

What is the current net interest margin for PSB Holding Corp.?

The net interest margin for Q1 2021 was 3.42%, down from 3.70% in Q1 2020.

What are the total assets of PSB Holding Corp. as of March 31, 2021?

Total assets of PSB Holding Corp. were $571.7 million as of March 31, 2021.