Provident Bancorp, Inc. Reports Earnings for the June 30, 2021 Quarter and Continues Payment of Quarterly Cash Dividends of $0.04 per Share

Rhea-AI Summary

Provident Bancorp (PVBC) reported a net income of $3.2 million for Q2 2021, slightly down from $3.3 million in Q2 2020. For the first six months of 2021, net income rose to $7.5 million, compared to $4.5 million in 2020. The company declared a quarterly cash dividend of $0.04 per share, payable on August 27, 2021. Notably, net interest income increased by 12% for Q2, fueled by a rise in deposits from digital asset clients. However, a higher provision for loan losses of $1.7 million was noted due to economic conditions related to COVID-19. Total assets rose to $1.59 billion, with a 6.8% increase in deposits.

Positive

• Net income for the first half of 2021 rose to $7.5 million from $4.5 million in 2020.
• Q2 2021 net interest income increased by 12% year-over-year.
• Total assets increased by $79.3 million, or 5.3%, to $1.59 billion.
• Total deposits grew by $84.4 million, or 6.8%, due to increased digital asset customer relationships.

Negative

• Q2 2021 net income was slightly lower than Q2 2020.
• Provision for loan losses increased to $1.7 million for Q2 2021, up from $872,000 in Q2 2020.
• Shareholders' equity decreased by 1.8% to $231.6 million due to stock repurchases and dividends.

AMESBURY, Mass., July 29, 2021 /PRNewswire/ -- Provident Bancorp, Inc. (the "Company") (NasdaqCM: PVBC), the holding company for The Provident Bank (the "Bank"), reported net income for the three months ended June 30, 2021 of $3.2 million, or $0.18 per diluted share, compared to $3.3 million, or $0.18 per diluted share, for the three months ended June 30, 2020. Net income for the six months ended June 30, 2021 was $7.5 million, or $0.43 per diluted share, compared to $4.5 million, or $0.25 per diluted share, for the six months ended June 30, 2020.

The Company also announced that its Board of Directors has declared a quarterly cash dividend of $0.04 per share, which will be paid on August 27, 2021 to stockholders of record as of August 13, 2021.

In announcing these results, Dave Mansfield, Chief Executive Officer said, "The development of new technologies and the changing needs of customers has put immense pressure on the banking industry to evolve. Over the past few years our institution has focused on embracing innovation and leveraging new technologies to deliver a better banking experience to businesses who seek digital solutions. By forming new relationships with several digital asset companies and implementing newly developed digital services, we have seen financial benefits in the form of increased non-interest bearing deposits and fee income as well as an expansion in our specialty lending portfolio. Our Bank is excited to be an active participant in the evolution of our industry as we continue to seek new ways to challenge the traditional processes of today to transform the customer experience of tomorrow."

COVID–19 Response

Since the distribution of the first COVID-19 vaccination began in December, additional vaccines have been approved for use and the Company's market area has progressed through different phases of the vaccine rollout. As larger percentages of the population become fully vaccinated, and warmer weather has begun, there has been an uptick in economic activity, particularly in those industries that had been most heavily impacted by the economic downturn caused by the COVID-19 pandemic.

In December 2020, Congress approved a bill which allocated additional funds to the Small Business Administration ("SBA") for a second round of Paycheck Protection Program ("PPP") loans to assist with the economic fallout caused by the COVID-19 pandemic. The SBA, in consultation with the U.S. Treasury department, resumed the PPP in January of 2021 through May 31, 2021. During the first round of the PPP, which ran from March to August 2020, the Company originated $78.0 million in PPP loans. As of June 30, 2021, the Company has originated an additional $46.0 million under the second round of the PPP. The Company continues to work with customers who received PPP loans on applying for loan forgiveness, and as of June 30, 2021, of the $124.0 million in PPP loans issued, only $43.3 million remained outstanding with unaccreted fee income totaling $1.7 million.

The Company's focus has been on meeting the needs of its customers through the height of the pandemic and now through the economic recovery. We continue to maintain close communication with commercial customers, especially in those industries most heavily impacted by the pandemic. Most loans that were modified under the Coronavirus Aid, Relief, and Economic Security ("CARES") Act have resumed repayment or have been paid off. We have not experienced any significant delinquencies related to these loans that have resumed repayment. As of June 30, 2021, remaining loan modifications that were made under the CARES Act totaled $18.9 million, or 1.4% of total loans, compared to $44.0 million, or 3.3% of total loans at December 31, 2020.

Financial Results

For the three and six month period ended June 30, 2021, net interest and dividend increased by $1.6 million, or 12.0%, and increased by $4.4 million, or 17.5%, compared to the three and six months ended June 30, 2020, respectively. For the three months ended June 30, 2021 interest and dividend income increased $859,000, or 5.9%, to $15.5 million compared to $14.7 million for the same period in 2020. The primary reason for the increase was an increase in average interest earning assets of $211.7 million, partially offset by a decrease in the yield on interest earning assets of 43 basis points to 4.20% for the three months ended June 30, 2021 compared to 4.63% for the same period in 2020. Also contributing to the increase in net interest and dividend income for the three months ended June 30, 2021 was a decrease in interest expense of $709,000, or 43.8%, to $910,000 compared to $1.6 million for the three months ended June 30, 2020. Interest expense declined as a result of the rate environment and a lower cost of funds of 43 basis points, to 0.43%, for the three months ended June 30, 2021 compared to 0.86% for the same period in 2020. Net interest and dividend income increased by $4.4 million, or 17.5%, for the six months ended June 30, 2021 compared to the six months ended June 30, 2020. For the six months ended June 30, 2021, interest and dividend income increased $2.7 million, or 9.3%, to $31.4 million compared to $28.7 million for the same period in 2020. The primary reason for the increase was an increase in average interest earning assets of $271.0 million, partially offset by a decrease in the yield on interest earning assets of 52 basis points to 4.27% for the six months ended June 30, 2021 compared to 4.79% for the same period in 2020. Also contributing to the increase in net interest and dividend income for the six months ended June 30, 2021 was a decrease in interest expense of $1.7 million, or 48.0%, to $1.9 million compared to $3.6 million for the six months ended June 30, 2020. Interest expense declined as a result of the rate environment and a lower cost of funds of 55 basis points, to 0.44% for the six months ended June 30, 2021 compared to 0.99% for the same period in 2020. The decrease in yield on assets and cost of funds for the three and six months ended June 30, 2021, are the result of a decrease in the national rate environment. The decreasing rate environment resulted in a decrease in our net interest margin of 17 basis points to 3.95% from 4.12% for the three months ended June 30, 2021, and 18 basis points to 4.01% from 4.19% for the six months ended June 30, 2021 when compared to the same periods in 2020.

Provision for loan losses of $1.7 million were recognized for the three months ended June 30, 2021 compared to $872,000 for the same period in 2020. For the six months ended June 30, 2021, a provision of $2.4 million was recognized compared to $4.0 million for the six months ended June 30, 2020. The changes in the provision were based on management's assessment of economic conditions, including the impact of the COVID-19 pandemic, loan portfolio growth and composition changes, historical charge-off trends, levels of problem loans and other asset quality trends.

The allowance for loan losses as a percentage of total loans was 1.43% as of June 30, 2021 compared to 1.39% as of December 31, 2020. The primary reason for the increase was a $1.3 million loan relationship that was placed on nonaccrual status in the second quarter of 2021 with specific reserves of $956,000. Net charge-offs for the six months ended June 30, 2021 were $1.5 million compared to $657,000 for the same period in 2020. The primary reason for the increase in net charge-offs was the charge-off of a $1.2 million impaired loan that was previously reserved for during the first quarter. During the first quarter, the increases to the allowance were partially offset by a decrease in the provision allocated to mortgage warehouse loan balances resulting from the Bank's seasoning experience with this line of lending. There were $227.1 million and $265.4 million in outstanding mortgage warehouse loan balances at June 30, 2021 and December 31, 2020, respectively. Loans in this segment are facility lines to non-bank mortgage origination companies for sale into secondary markets, which typically occurs within 15 days of the loan closure. Due to their short-term nature, these loans are assessed at a lower credit risk and do not carry the same allocation as traditional loans. Included in total loans is $43.3 million in PPP loans originated as part of the CARES Act that we believe have no credit risk due to a government guarantee, therefore we have not provided for losses for these loans. Excluding PPP loans, the allowance for loan losses as a percentage of total loans was 1.48% as of June 30, 2021 compared to 1.43% at December 31, 2020. The allowance for loan losses as a percentage of non-performing loans was 416.12% as of June 30, 2021 compared to 341.72% as of December 31, 2020. Non-performing loans were $4.7 million, or 0.29% of total assets as of June 30, 2021, compared to $5.4 million, or 0.36% of total assets, as of December 31, 2020. As of June 30, 2021, non-performing loans consist primarily of two commercial relationships totaling $3.3 million. These loan relationships were evaluated for impairment and specific reserves of $2.8 million were allocated as of June 30, 2021.

Noninterest income increased $399,000, or 56.7%, to $1.1 million for the three months ended June 30, 2021 compared to $704,000 for the three months ended June 30, 2020. The increase is primarily due to an increase in other service charges and fees of $177,000, or 67.8%, and an increase in customer service fees on deposit accounts of $169,000, or 64.0%. The increase in other service charges and fees is primarily due to waived fees in 2020 for customers impacted by COVID-19 in addition to a loan payoff charge on a commercial real estate loan. The increase in customer service fees on deposit accounts is primarily due to waived fees in 2020 for customers impacted by COVID-19 in addition to fees generated from the cash vault services for our customers who operate Bitcoin ATMs. For the six months ended June 30, 2021, noninterest income increased $407,000, or 23.7%, to $2.1 million compared to $1.7 million for the six months ended June 30, 2020. This was primarily due to an increase in customer service fees on deposit accounts of $196,000, or 31.8%, and an increase in other service charges and fees of $67,000 or 9.3%. The increase in customer service fees on deposit accounts was primarily due to waived fees in 2020 for customers impacted by COVID-19 in addition to fees generated from the cash vault services for our customers who operate Bitcoin ATMs. Other service charges and fees increased primarily due to income from a loan payoff charge on a commercial real estate loan partially offset by a decrease in overdraft fee income. Noninterest income for the six months ended June 30, 2021 also increased due to an increase in bank owned life insurance income of $92,000, or 26.3%, when compared to the same period in 2020 due to the purchase of additional insurance policies in 2020. Other income increased $52,000, or 192.6% for the six months ended June 30, 2021 primarily due to a one-time incentive payment on a service contract received in the first quarter of 2021.

Noninterest expense increased $1.1 million, or 14.0%, to $9.5 million for the three months ended June 30, 2021 compared to $8.4 million for the three months ended June 30, 2020. The increase is primarily due to an increase in salaries and employee benefits expense, professional fees, data processing fees and directors' compensation. The increase of $905,000, or 15.6%, in salary and employee benefits was primarily due to increased stock-based compensation expense and a higher number of sales and operations positions compared to the same period in 2020. The increase of $102,000, or 27.8%, in professional fees was primarily due to costs paid to third party vendors for program assistance as well as increased legal, and audit and compliance costs. Data processing fees increased $92,000 or 41.4%, primarily due to new contracts for deposit services. Directors' compensation increased $90,000, or 52.6%, primarily due to increased stock-based compensation expense. For the six months ended June 30, 2021, noninterest expense increased $2.0 million, or 12.4%, to $18.7 million compared to $16.7 million for the six months ended June 30, 2020. The increase is primarily due to an increase in salaries and employee benefits expense, data processing fees, directors' compensation, professional fees and deposit insurance expenses, partially offset by a decrease in write downs of other assets and receivables. The increase of $2.0 million, or 17.7%, for the six months ended June 30, 2021 when compared to the same period in 2020 in salary and employee benefits was primarily due to stock based compensation expense and a higher number of sales and operations positions compared to the same period in 2020. Data processing fees increased $187,000 or 41.7%, primarily due to new contracts for deposit services. Directors' compensation increased $150,000, or 41.1%, primarily due to increase stock-based compensation expense. Professional fees increased $147,000, or 19.5%, primarily due to management fees and an increase in audit and compliance costs. Deposit insurance expenses increased $93,000, or 75.0%, primarily due to one-time credits that were recognized in the first quarter of 2020 that resulted in a lower expense. These increases were offset by a decrease in write downs of other assets and receivables of $500,000. In the first quarter of 2020 a write-down of a notes receivable balance was completed after the Company evaluated the collectability and determined that $500,000 was uncollectible.

As of June 30, 2021, total assets have increased $79.3 million, or 5.3%, to $1.59 billion compared to $1.51 billion at December 31, 2020. The primary reasons for the increase are increases in cash and cash equivalents and net loans. The increase in cash and cash equivalents of $56.6 million, or 67.5% is primarily due to an increase in deposits. Net loans increased $19.8 million, or 1.5%, and were $1.33 billion as of June 30, 2021 compared to $1.31 billion at December 31, 2020. The increase in net loans was due to an increase in commercial loans of $71.8 million, or 12.7% and construction and land development loans of $4.6 million, or 15.9%, partially offset by decreases in mortgage warehouse loans of $38.2 million, or 14.4%, commercial real estate loans of $7.7 million, or 1.8%, residential real estate loans of $6.2 million, or 18.8%, and consumer loans of $2.5 million, or 45.1%. Our commercial loan growth was primarily due to increases in our specialty lending portfolios. As of June 30, 2021, enterprise value loans increased $17.9 million, or 6.3%, to $304.0 million compared to $286.1 million at December 31, 2020. Renewable energy loans increased $13.8 million, or 37.1%, to $51.0 million compared to $37.2 million at December 31, 2020. Also included in commercial loans at June 30, 2021 and December 31, 2020 were $45.0 million and $15.0 million in loans to crypto companies.

Total liabilities increased $83.6 million, or 6.6%, due to increased deposits. Deposits were $1.32 billion as of June 30, 2021, representing an increase of $84.4 million, or 6.8%, compared to December 31, 2020. The increase in deposits was due to an increase of $91.9 million, or 16.6%, in NOW and demand deposits, an increase of $42.2 million, or 11.9% in money market accounts, an increase of $2.9 million, or 1.9%, in savings accounts, partially offset by a decrease of $52.6 million, or 29.5%, in time deposits. NOW and demand deposits and money market deposits increased primarily due to funds from the origination of PPP loans and increased deposit balances from new and expanded relationships with digital asset customers, which totaled $94.6 million at June 30, 2021. The increase in savings accounts is primarily caused by increased consumer savings. The decrease in time deposits is primarily due to roll-off of brokered certificates of deposit. In addition, the Bank has increased focused on growing non-interest bearing deposit balances and as of June 30, 2021 non-interest bearing deposits represented 36.6% total deposits compared to 31.0% at December 31, 2020.

As of June 30, 2021, shareholders' equity was $231.6 million compared to $235.9 million at December 31, 2020, representing a decrease of $4.3 million, or 1.8%. The decrease was primarily due to the repurchase of 869,301 shares of common stock for $12.4 million, $1.2 million from dividends paid, and a decrease in other comprehensive income of $59,000, partially offset by net income of $7.5 million, stock-based compensation expense of $1.3 million and employee stock ownership plan shares earned of $647,000.

About Provident Bancorp, Inc.

BankProv, legally operating as The Provident Bank, is a subsidiary of Provident Bancorp, Inc. (NASDAQ: PVBC). BankProv is a future-ready commercial bank for corporate clients, specializing in offering adaptive and technology-first banking solutions to niche markets, including cryptocurrency, renewable energy, fin-tech and search fund lending. We are committed to offering state-of-the-art APIs (application programming interfaces) for all business clients and BaaS (Bank as a Service) partners. Through our offerings, BankProv insures 100% of deposits through a combination of insurance provided by the Federal Deposit Insurance Corporation (FDIC) and the Depositors Insurance Fund (DIF). For more information about BankProv please visit our website www.bankprov.com or call 877-487-2977.

Forward-looking statements

This news release may contain certain forward-looking statements, such as statements of the Company's or the Bank's plans, objectives, expectations, estimates and intentions. Forward-looking statements may be identified by the use of words such as, "expects," "subject," "believe," "will," "intends," "may," "will be" or "would." These statements are subject to change based on various important factors (some of which are beyond the Company's or the Bank's control) and actual results may differ materially. Accordingly, readers should not place undue reliance on any forward-looking statements (which reflect management's analysis of factors only as of the date of which they are given). These factors include: general economic conditions; the effects of any pandemic; trends in interest rates; the ability of our borrowers to repay their loans; and the ability of the Company or the Bank to effectively manage its growth and results of regulatory examinations, among other factors. The foregoing list of important factors is not exclusive. Readers should carefully review the risk factors described in other documents of the Company files from time to time with the Securities and Exchange Commission, including Annual and Quarterly Reports on Forms 10-K and 10-Q, and Current Reports on Form 8-K.

Provident Bancorp, Inc.
Carol Houle, 603-334-1253
Executive Vice President/CFO
choule@bankprov.com

 

Provident Bancorp, Inc. Consolidated Balance Sheet
	At			At
	June 30,			December 31,
	2021			2020
(Dollars in thousands)		(unaudited)
Assets
Cash and due from banks	$	17,808		$	11,830
Short-term investments		122,576			71,989
Cash and cash equivalents		140,384			83,819
Debt securities available-for-sale (at fair value)		32,597			32,215
Federal Home Loan Bank stock, at cost		785			895
Loans, net of allowance for loan losses of $19,412 and $18,518 as of
June 30, 2021 and December 31, 2020, respectively		1,334,635			1,314,810
Bank owned life insurance		37,126			36,684
Premises and equipment, net		14,471			14,716
Accrued interest receivable		5,821			6,371
Right-of-use assets		4,180			4,258
Other assets		15,107			12,013
Total assets	$	1,585,106		$	1,505,781
Liabilities and Shareholders' Equity
Deposits:
Noninterest-bearing	$	484,066		$	383,079
Interest-bearing		837,723			854,349
Total deposits		1,321,789			1,237,428
Long-term borrowings		13,500			13,500
Operating lease liabilities		4,438			4,488
Other liabilities		13,771			14,509
Total liabilities		1,353,498			1,269,925
Shareholders' equity:
Preferred stock; authorized 50,000 shares:
no shares issued and outstanding		—			—
Common stock, $0.01 par value, 100,000,000 shares authorized;
18,246,136 and 19,047,544 shares issued and outstanding
at June 30, 2021 and December 31, 2020, respectively		182			191
Additional paid-in capital		128,666			139,450
Retained earnings		110,752			104,508
Accumulated other comprehensive income		999			1,058
Unearned compensation - ESOP		(8,991)			(9,351)
Total shareholders' equity		231,608			235,856
Total liabilities and shareholders' equity	$	1,585,106		$	1,505,781

 

Provident Bancorp, Inc. Consolidated Income Statements
	Three Months Ended							Six Months Ended
	June 30,							June 30,
	2021			2020				2021			2020
(Dollars in thousands, except per share data)	(unaudited)
Interest and dividend income:
Interest and fees on loans	$	15,298		$	14,391		$	30,995		$	28,151
Interest and dividends on debt securities available-for-sale		186			259			355			517
Interest on short-term investments		29			4			52			75
Total interest and dividend income		15,513			14,654			31,402			28,743
Interest expense:
Interest on deposits		839			1,443			1,750			3,089
Interest on borrowings		71			176			141			547
Total interest expense		910			1,619			1,891			3,636
Net interest and dividend income		14,603			13,035			29,511			25,107
Provision for loan losses		1,669			872			2,422			3,971
Net interest and dividend income after provision for loan losses		12,934			12,163			27,089			21,136
Noninterest income:
Customer service fees on deposit accounts		433			264			812			616
Service charges and fees - other		438			261			788			721
Bank owned life insurance income		223			171			442			350
Other income		9			8			79			27
Total noninterest income		1,103			704			2,121			1,714
Noninterest expense:
Salaries and employee benefits		6,704			5,799			13,181			11,201
Occupancy expense		417			429			829			870
Equipment expense		127			144			249			281
Deposit insurance		111			93			217			124
Data processing		314			222			635			448
Marketing expense		81			71			118			135
Professional fees		469			367			900			753
Directors' compensation		261			171			515			365
Software depreciation and implementation		241			238			487			438
Write down of other assets and receivables		—			—			—			500
Other		803			827			1,610			1,552
Total noninterest expense		9,528			8,361			18,741			16,667
Income before income tax expense		4,509			4,506			10,469			6,183
Income tax expense		1,343			1,256			3,006			1,702
Net income	$	3,166		$	3,250		$	7,463		$	4,481
Earnings per share:
Basic	$	0.19		$	0.18		$	0.44		$	0.25
Diluted	$	0.18		$	0.18		$	0.43		$	0.25
Weighted Average Shares:
Basic		16,778,698			18,150,106			17,019,889			18,131,421
Diluted		17,338,662			18,179,858			17,442,411			18,197,646

 

Provident Bancorp, Inc. Net Interest Income Analysis (Unaudited)
	For the Three Months Ended June 30,
	2021								2020
				Interest								Interest
	Average			Earned/			Yield/		Average			Earned/			Yield/
(Dollars in thousands)	Balance			Paid			Rate		Balance			Paid			Rate
Assets:
Interest-earning assets:
Loans	$	1,302,699		$	15,298		4.70%		$	1,207,921		$	14,391		4.77%
Short-term investments		140,985			29		0.08%			18,915			4		0.08%
Debt securities available-for-sale		33,798			183		2.17%			38,503			219		2.28%
Federal Home Loan Bank stock		843			3		1.42%			1,323			40		12.09%
Total interest-earning assets		1,478,325			15,513		4.20%			1,266,662			14,654		4.63%
Non-interest earning assets		70,357								59,271
Total assets	$	1,548,682							$	1,325,933
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Savings accounts	$	151,381			56		0.15%		$	129,753			77		0.24%
Money market accounts		375,537			447		0.48%			281,457			516		0.73%
NOW accounts		157,845			89		0.23%			126,023			113		0.36%
Certificates of deposit		142,258			247		0.69%			160,295			737		1.84%
Total interest-bearing deposits		827,021			839		0.41%			697,528			1,443		0.83%
Borrowings		13,500			71		2.10%			53,438			176		1.32%
Total interest-bearing liabilities		840,521			910		0.43%			750,966			1,619		0.86%
Noninterest-bearing liabilities:
Noninterest-bearing deposits		452,766								324,296
Other noninterest-bearing liabilities		18,731								15,659
Total liabilities		1,312,018								1,090,921
Total equity		236,664								235,012
Total liabilities and
equity	$	1,548,682							$	1,325,933
Net interest income				$	14,603							$	13,035
Interest rate spread (1)							3.77%								3.77%
Net interest-earning assets (2)	$	637,804							$	515,696
Net interest margin (3)							3.95%								4.12%
Average interest-earning assets to
interest-bearing liabilities		175.88%								168.67%

 

(1)	Net interest rate spread represents the difference between the weighted average yield on interest-bearing assets and the weighted average rate of interest-bearing liabilities.
(2)	Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(3)	Net interest margin represents net interest income divided by average total interest-earning assets.

 

	For the Six Months Ended June 30,
	2021								2020
				Interest								Interest
	Average			Earned/			Yield/		Average			Earned/			Yield/
(Dollars in thousands)	Balance			Paid			Rate		Balance			Paid			Rate
Assets:
Interest-earning assets:
Loans	$	1,310,127		$	30,995		4.73%		$	1,138,223		$	28,151		4.95%
Short-term investments		126,671			52		0.08%			19,045			75		0.79%
Debt securities available-for-sale		32,578			348		2.14%			39,767			457		2.30%
Federal Home Loan Bank stock		869			7		1.61%			2,242			60		5.35%
Total interest-earning assets		1,470,245			31,402		4.27%			1,199,277			28,743		4.79%
Non-interest earning assets		68,269								58,227
Total assets	$	1,538,514							$	1,257,504
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Savings accounts	$	151,378			111		0.15%		$	125,430			182		0.29%
Money market accounts		375,309			924		0.49%			268,669			1,221		0.91%
NOW accounts		155,582			187		0.24%			125,155			268		0.43%
Certificates of deposit		154,256			528		0.68%			147,057			1,418		1.93%
Total interest-bearing deposits		836,525			1,750		0.42%			666,311			3,089		0.93%
Borrowings		13,500			141		2.09%			66,154			547		1.65%
Total interest-bearing liabilities		850,025			1,891		0.44%			732,465			3,636		0.99%
Noninterest-bearing liabilities:
Noninterest-bearing deposits		432,670								275,368
Other noninterest-bearing liabilities		18,361								15,694
Total liabilities		1,301,056								1,023,527
Total equity		237,458								233,977
Total liabilities and
equity	$	1,538,514							$	1,257,504
Net interest income				$	29,511							$	25,107
Interest rate spread (1)							3.83%								3.80%
Net interest-earning assets (2)	$	620,220							$	466,812
Net interest margin (3)							4.01%								4.19%
Average interest-earning assets to
interest-bearing liabilities		172.96%								163.73%

 

(1)	Net interest rate spread represents the difference between the weighted average yield on interest-bearing assets and the weighted average rate of interest-bearing liabilities.
(2)	Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(3)	Net interest margin represents net interest income divided by average total interest-earning assets

 

Provident Bancorp, Inc. Select Financial Highlights
	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
(unaudited)
Performance Ratios:
Return on average assets (1)		0.82%			0.98%			0.97%			0.71%
Return on average equity (1)		5.35%			5.53%			6.29%			3.83%
Interest rate spread (1) (3)		3.76%			3.77%			3.83%			3.80%
Net interest margin (1) (4)		3.95%			4.12%			4.01%			4.19%
Non-interest expense to average assets (1)		2.46%			2.52%			2.44%			2.65%
Efficiency ratio (5)		60.66%			60.86%			59.25%			62.14%
Average interest-earning assets to
average interest-bearing liabilities		175.88%			168.67%			172.96%			163.73%
Average equity to average assets		15.28%			17.72%			15.43%			18.61%

 

	At			At			At
	June 30,			December 31,			June 30,
	2021			2020			2020
Asset Quality
Non-accrual loans:
Commercial real estate	$	114		$	—		$	20,865
Commercial		3,615			4,198			4,309
Residential real estate		923			1,156			844
Construction and land development		—			—			—
Consumer		13			65			21
Mortgage warehouse		—			—			—
Total non-accrual loans		4,665			5,419			26,039
Accruing loans past due 90 days or more		—			—			—
Other real estate owned		—			—			—
Total non-performing assets	$	4,665		$	5,419		$	26,039
Asset Quality Ratios
Allowance for loan losses as a percent of total loans (2)		1.43%			1.39%			1.34%
Allowance for loan losses as a percent of non-performing loans		416.12%			341.72%			65.89%
Non-performing loans as a percent of total loans (2)		0.34%			0.41%			2.03%
Non-performing loans as a percent of total assets		0.29%			0.36%			1.84%
Non-performing assets as a percent of total assets (6)		0.29%			0.36%			1.84%
Capital and Share Related
Stockholders' equity to total assets		14.6%			15.7%			16.7%
Book value per share	$	12.69		$	12.38		$	12.14
Market value per share	$	16.31		$	12.00		$	7.86
Shares outstanding		18,246,136			19,047,544			19,472,310

 

(1)	Annualized
(2)	Loans are presented before the allowance but include deferred costs/fees.
(3)	Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of interest-bearing liabilities.
(4)	Represents net interest income as a percent of average interest-earning assets.
(5)	Represents noninterest expense divided by the sum of net interest income and noninterest income, excluding gains on securities available for sale, net.
(6)	Non-performing assets consists of non-accrual loans plus loans accruing but 90 days overdue and OREO.

 

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SOURCE Provident Bancorp Inc.

FAQ

What were Provident Bancorp's earnings for Q2 2021?

Provident Bancorp reported net income of $3.2 million for Q2 2021.

How much did Provident Bancorp declare as a cash dividend?

The company declared a quarterly cash dividend of $0.04 per share.

What was the total asset value for Provident Bancorp as of June 30, 2021?

Total assets increased to $1.59 billion as of June 30, 2021.

How did net interest income change for Q2 2021?

Net interest income increased by 12% year-over-year for Q2 2021.

What caused the increase in the provision for loan losses at Provident Bancorp?

The provision for loan losses increased to $1.7 million due to economic conditions related to COVID-19.