SB Financial Group Announces Third Quarter 2021 Results

Rhea-AI Summary

SB Financial Group reported a net income of $4.1 million for Q3 2021, showing a 21.8% decrease year-over-year, and 66.4% increase for the nine months with $14.9 million. EPS was $0.58, down 15.9% year-over-year but up 11.5% from last quarter. Mortgage origination decreased 23.8% to $152.6 million. Total deposits increased 9.6% to $1.11 billion. Nonperforming assets dropped 23.1% from the prior year. The company continues to show resilience despite challenges in mortgage banking.

Positive

• Net income for nine months rose 66.4%, totaling $14.9 million.
• EPS increased by 11.5% from the linked quarter.
• Deposits grew by 9.6% to $1.11 billion.
• Nonperforming assets decreased by 23.1% year-over-year.

Negative

• Q3 net income decreased by 21.8% year-over-year.
• Mortgage origination volume fell by 23.8% compared to Q3 2020.
• Noninterest income decreased by 36% year-over-year.

DEFIANCE, Ohio, Oct. 28, 2021 /PRNewswire/ -- SB Financial Group, Inc. (NASDAQ: SBFG) ("SB Financial" or the "Company"), a diversified financial services company providing full-service community banking, mortgage banking, wealth management, private client and title insurance services today reported earnings for the third quarter and nine months ended September 30, 2021.

Third quarter 2021 highlights over prior-year third quarter include:

• Net income of $4.1 million; diluted earnings per share ("EPS") of $0.58 or a 15.9 percent decrease
• Adjusted net income, excluding the impact of the Originated Mortgage Servicing Rights ("OMSR") impairment of $250,000 was $3.9 million, with EPS of $0.56
• Mortgage origination volume of $152.6 million, reflects a decrease of $47.5 million, or 23.8 percent

Third quarter 2021 highlights over the linked quarter include:

• Net income up $342,000 with EPS increasing $0.06 or 11.5 percent
• Loan growth excluding the impact of Paycheck Protection Program ("PPP") was up $20.6 million or 10 percent annualized

Nine months ended September 30, 2021, highlights over prior-year nine months include:

• Net income of $14.9 million and diluted EPS of $2.08, compared to $9.6 million, or $1.25 per share or a 66.4 percent increase
• Adjusted net income, excluding the impact of OMSR activity and merger costs, was $12.7 million, down $227,000 or 1.8 percent with EPS of $1.76, up $0.09 or 5.4 percent

Third quarter 2021 trailing twelve-month highlights include:

• Loans, excluding the impact of PPP loan balances from both years of $10.2 and $82.1 million, respectively, increased $32.6 million, or 4.1 percent from the prior year
• Deposits grew by $97.7 million, or 9.6 percent to $1.11 billion at quarter end
• Mortgage origination volume of $642.3 million; servicing portfolio of $1.34 billion, which is up $48.4 million, or 3.7 percent

Highlights	Three Months Ended					Nine Months Ended
($ in thousands, except per share & ratios)	Sep. 2021	Sep. 2020	% Change			Sep. 2021	Sep. 2020	% Change
Operating revenue	$      16,673	$      19,677	-15.3%			$      52,914	$      47,873	10.5%
Interest income	11,033	10,807	2.1%			31,901	32,046	-0.5%
Interest expense	1,009	1,548	-34.8%			3,095	5,367	-42.3%
Net interest income	10,024	9,259	8.3%			28,806	26,679	8.0%
Provision for loan losses	300	1,800	-83.3%			1,050	3,700	-71.6%
Noninterest income	6,649	10,418	-36.2%			24,108	21,194	13.7%
Noninterest expense	11,256	11,335	-0.7%			33,241	32,403	2.6%
Net income	4,103	5,250	-21.8%			14,945	9,586	55.9%
Earnings per diluted share	0.58	0.69	-15.9%			2.08	1.25	66.4%
Return on average assets	1.23%	1.73%	-28.9%			1.51%	1.12%	34.8%
Return on average equity	11.35%	15.01%	-24.4%			13.84%	9.74%	42.1%
Non-GAAP Measures
Adjusted net income	$        3,907	$        4,992	-21.7%			$      12,690	$      12,917	-1.8%
Adjusted diluted EPS	0.56	0.65	-13.8%			1.76	1.67	5.4%
Adjusted return on average assets	1.17%	1.64%	-28.7%			1.34%	1.41%	-5.0%
Adjusted pre-tax, pre-provision income	5,169	8,016	-35.5%			17,569	18,444	-4.7%

"The third quarter saw significant PPP forgiveness, which drove our EPS up nearly 12 percent from the linked quarter" said Mark A. Klein, Chairman, President, and CEO of SB Financial.   "Loan growth net of PPP was up compared to the prior year quarter and we have now had positive loan growth, excluding PPP, in each of the last two quarters."

RESULTS OF OPERATIONS

Consolidated Revenue

Total operating revenue, consisting of net interest income and noninterest income, was down 15.3 percent from the third quarter of 2020, but up 6.2 percent from the linked quarter.

• Net interest income was up from the year-ago quarter by 8.3 percent, and up 9.5 percent from the linked quarter.
• Net interest margin on a fully taxable equivalent basis (FTE) was down from the year-ago quarter by 20 basis points and flat to the linked quarter, as cash balances continued to be higher than normal, which was offset by higher PPP forgiveness.
• Noninterest income was down 36 percent from the year ago quarter as mortgage volume and gain on sale yields trended lower. This compares to a two percent increase from the linked quarter.

Mortgage Loan Business

Mortgage loan originations for the third quarter of 2021 were $152.6 million, down $47.5 million, or 23.8 percent, from the year-ago quarter.  Total sales of originated loans were $123.1 million, down $43.1 million, or 25.9 percent, from the year-ago quarter.  For the first nine months of 2021, SB Financial had total volume of $473.8 million, of which $236.2 million (50 percent) was new purchase/construction lending, $118.5 million was external refinance (25 percent), and the remaining $119.1 million (25 percent) was internal refinance.

Net mortgage banking revenue, consisting of gains on the sale of mortgage loans and net loan servicing fees, was $4.1 million for the third quarter of 2021, compared to $7.9 million for the year-ago quarter.  The mortgage servicing valuation adjustment for the third quarter of 2021 was a positive $248,000, compared to a positive adjustment of $326,000 for the third quarter of 2020.  For the first nine months of 2021, the recapture of servicing rights was $2.9 million compared to impairment of $3.0 million for the prior year nine months.  The aggregate servicing valuation impairment ended the quarter at $2.0 million.  The servicing portfolio at September 30, 2021, was $1.34 billion, up $48.4 million, or 3.7 percent, from $1.29 billion at September 30, 2020.  

Mr. Klein noted, "This quarter had relatively strong mortgage origination of $153 million, which while down 24 percent from the prior year, was down just seven percent from the linked quarter.  We continue to be positive about our mortgage pipeline as construction and private client activity remain strong.  We now have a total of 24 Mortgage Originators that represents an increase of four from the prior year which includes the addition of two originators in our Ft. Wayne growth market."

Mortgage Banking
($ in thousands)	Sep. 2021	Jun. 2021	Mar. 2021	Dec. 2020	Sep. 2020
Mortgage originations	$     152,623	$     164,883	$     155,836	$     168,997	$     200,158
Mortgage sales	123,083	119,064	136,708	143,151	166,201
Mortgage servicing portfolio	1,341,439	1,323,804	1,304,097	1,299,698	1,293,037
Mortgage servicing rights	11,194	10,678	10,490	7,759	8,535
Mortgage servicing revenue
Loan servicing fees	850	830	859	857	813
OMSR amortization	(943)	(948)	(1,187)	(1,283)	(1,308)
Net administrative fees	(93)	(118)	(328)	(426)	(495)
OMSR valuation adjustment	248	(99)	2,706	(611)	326
Net loan servicing fees	155	(217)	2,378	(1,037)	(169)
Gain on sale of mortgages	3,947	4,255	5,859	7,197	8,085
Mortgage banking revenue, net	$         4,102	$         4,038	$         8,237	$         6,160	$         7,916

Noninterest Income and Noninterest Expense

SB Financial's noninterest income for the quarter was down 36 percent from the prior year but up compared to the linked quarter by approximately two percent.  The gain on sale mortgage loan yields were down 165 basis points from the prior year with the total dollars of sales down $43.1 million.  Wealth management revenue was up over 14 percent from the prior year due to higher retention levels and growth in the equity sector.  SB Financial's Title Agency provided revenue in the quarter of $508,000. 

For the third quarter of 2021, noninterest expense of $11.3 million was flat to the prior year and up slightly to the linked quarter.  For the first nine months, noninterest expense of $33.2 million was up $838,000 or 2.6 percent compared to the prior year first nine months.  Operating leverage for the nine months of 2021 compared to the prior year was positive with revenue growth of 10.5 percent exceeding expense growth of 2.6 percent by 4.1 times.

Noninterest Income / Noninterest Expense
($ in thousands, except ratios)	Sep. 2021	Jun. 2021	Mar. 2021	Dec. 2020	Sep. 2020
Noninterest Income (NII)	$         6,649	$         6,537	$       10,922	$         8,902	$       10,418
NII / Total Revenue	39.9%	41.7%	53.2%	49.0%	52.9%
NII / Average Assets	2.0%	2.0%	3.4%	2.9%	3.4%
Total Revenue Growth	-15.3%	-10.3%	91.9%	24.7%	36.4%
Noninterest Expense (NIE)	$       11,256	$       11,076	$       10,909	$       10,684	$       11,335
Efficiency Ratio	67.4%	70.5%	53.0%	58.8%	57.5%
NIE / Average Assets	3.4%	3.3%	3.4%	3.5%	3.7%
Net Noninterest Expense/Avg. Assets	-1.4%	-1.4%	0.0%	-0.6%	-0.3%
Total Expense Growth	-0.7%	-5.0%	16.0%	5.0%	19.3%
Operating Leverage	-21.5	-2.1	5.7	4.9	1.9

Balance Sheet

Total assets as of September 30, 2021, were $1.33 billion, up $111.5 million, or 9.2 percent, from the year ago quarter due to higher liquidity levels and PPP activity.  Total shareholders' equity as of September 30, 2021, was $144.3 million, up 2.1 percent from a year ago, and comprised 10.9 percent of total assets. 

Total loans held for investment were $846.5 million at September 30, 2021, down $39.3 million, or 4.4 percent, from September 30, 2020.  Excluding PPP activity from both years, loan balances were up $32.6 million, or 4.1 percent.

The investment portfolio of $254.1 million, including shares in the Federal Reserve Bank and Federal Home Loan Bank, represented 19.1 percent of assets at September 30, 2021, and was up 87.4 percent from the year-ago period.  Deposit balances of $1.11 billion at September 30, 2021, increased by $97.6 million, or 9.6 percent, since September 30, 2020.  Growth from the prior year included $58.7 million in checking and $38.9 million in savings and time deposit balances.

Mr. Klein continued, "Our lending teams were very busy in the quarter as we had solid loan growth for the second consecutive quarter and we assisted a number of clients in submitting PPP forgiveness applications.  We also had two non-performing credits that paid off in the quarter, resulting in lower NPA balances and recapture of prior non-accrual interest.  Our coverage of non-performing loans is now above 350 percent and we continue to have no loans on COVID deferral."

Loan Balances
($ in thousands, except ratios)	Sep. 2021		Jun. 2021		Mar. 2021		Dec. 2020		Sep. 2020		Annual Growth
Commercial	$	138,085	$	149,998	$	179,157	$	203,256	$	216,667	$	(78,582)
% of Total	16.3%		17.6%		21.1%		23.3%		24.5%		-36.3%
Commercial RE	387,858		389,287		385,403		370,984		371,947		15,911
% of Total	45.8%		45.8%		45.4%		42.5%		42.0%		4.3%
Agriculture	57,374		50,895		48,405		55,251		57,420		(46)
% of Total	6.8%		6.0%		5.7%		6.3%		6.5%		-0.1%
Residential RE	207,571		203,294		176,998		182,076		178,393		29,178
% of Total	24.5%		23.9%		20.9%		20.9%		20.1%		16.4%
Consumer & Other	55,660		57,039		58,213		61,156		61,423		(5,763)
% of Total	6.6%		6.7%		6.9%		7.0%		6.9%		-9.4%
Total Loans	$	846,548	$	850,513	$	848,176	$	872,723	$	885,850	$	(39,302)
Total Growth Percentage											-4.4%
Deposit Balances
($ in thousands, except ratios)	Sep. 2021		Jun. 2021		Mar. 2021		Dec. 2020		Sep. 2020		Annual Growth
Non-Int DDA	$	258,857	$	240,572	$	273,026	$	251,649	$	225,003	$	33,854
% of Total	23.3%		22.0%		24.4%		24.0%		22.2%		15.0%
Interest DDA	189,130		187,023		191,593		176,785		164,248		24,882
% of Total	17.0%		17.1%		17.1%		16.9%		16.2%		15.1%
Savings	246,414		235,231		218,260		174,864		169,474		76,940
% of Total	22.2%		21.6%		19.5%		16.7%		16.7%		45.4%
Money Market	258,741		255,512		249,088		216,164		204,862		53,879
% of Total	23.3%		23.4%		22.2%		20.6%		20.2%		26.3%
Time Deposits	158,518		172,696		188,229		229,549		250,428		(91,910)
% of Total	14.3%		15.8%		16.8%		21.9%		24.7%		-36.7%
Total Deposits	$	1,111,660	$	1,091,034	$	1,120,196	$	1,049,011	$	1,014,015	$	97,645
Total Growth Percentage											9.6%

Asset Quality

SB Financial reported nonperforming assets of $5.6 million as of September 30, 2021, down $1.7 million or 23.1 percent from the year-ago quarter.  The Company took $206,000 in net recoveries in the quarter.  The coverage of problem loans by the loan loss allowance was at 351 percent at September 30, 2021, up from 164 percent at September 30, 2020.

Nonperforming Assets						Annual Change
($ in thousands, except ratios)	Sep. 2021	Jun. 2021	Mar. 2021	Dec. 2020	Sep. 2020
Commercial & Agriculture	$             144	$             375	$             615	$             902	$          1,140	$            (996)
% of Total Com./Ag. loans	0.07%	0.19%	0.27%	0.35%	0.42%	-87.4%
Commercial RE	566	1,026	2,402	2,412	2,475	(1,909)
% of Total CRE loans	0.15%	0.26%	0.62%	0.65%	0.67%	-77.1%
Residential RE	2,056	1,751	2,138	2,704	2,481	(425)
% of Total Res. RE loans	0.99%	0.86%	1.21%	1.49%	1.39%	-17.1%
Consumer & Other	422	463	480	408	313	109
% of Total Con./Oth. loans	0.76%	0.81%	0.82%	0.67%	0.51%	34.8%
Total Nonaccruing Loans	3,188	3,615	5,635	6,426	6,409	(3,221)
% of Total loans	0.38%	0.43%	0.66%	0.74%	0.72%	-50.3%
Accruing Restructured Loans	805	758	794	810	789	16
Total Change (%)						2.0%
Total Nonaccruing & Restructured Loans	3,993	4,373	6,429	7,236	7,198	(3,205)
% of Total loans	0.47%	0.51%	0.76%	0.83%	0.81%	-44.5%
Foreclosed Assets	1,601	1,603	43	23	76	1,525
Total Change (%)						2006.6%
Total Nonperforming Assets	$          5,594	$          5,976	$          6,472	$          7,259	$          7,274	$         (1,680)
% of Total assets	0.42%	0.46%	0.49%	0.58%	0.60%	-23.1%

Webcast and Conference Call

The Company will hold a related conference call and webcast on October 29, 2021, at 11:00 a.m. EDT.  Interested parties may access the conference call by dialing 1-888-338-9469.  The webcast can be accessed at ir.yourstatebank.com.  An audio replay of the call will be available on the Company's website.

About SB Financial Group                                                                          

Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title).  State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 23 offices; 22 in nine Ohio counties and one in Fort Wayne, Indiana, and 24 full-service ATMs. State Bank has five loan production offices located throughout the Tri-State region of Ohio, Indiana and Michigan.  Peak Title provides title insurance and opinions throughout the Tri-State region. SB Financial's common stock is listed on the NASDAQ Capital Market under the symbol "SBFG".

In May 2021, SB Financial was named to the Keefe, Bruyette & Woods, Inc. "Bank Honor Roll" of superior performers as revealed in EPS increases for 10 consecutive years.  The honor roll review determined that just 16 banks, including SB Financial, or 4% of the nearly 400 banks screened, qualified for inclusion.

Forward-Looking Statements

Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, the duration and scope of the COVID-19 outbreak in the United States and the market areas in which SB Financial and its subsidiaries operate, including the impact to the state and local economies of prolonged shelter in place orders and the pandemic generally, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial's Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission.  Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles ("GAAP"). Non-GAAP financial measures, specifically pre-tax, pre-provision income, tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common equity, total interest income – FTE, net interest income – FTE and net interest margin – FTE are used by the Company's management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders.  In addition, the Company excludes the non-GAAP items of OMSR impairment and merger related costs from net income to report an adjusted net income level.  Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Investor Contact Information:
Mark A. Klein
Chairman, President and
Chief Executive Officer
Mark.Klein@YourStateBank.com

Anthony V. Cosentino
Executive Vice President and
Chief Financial Officer
Tony.Cosentino@YourStateBank.com

 

		SB FINANCIAL GROUP, INC.
		CONSOLIDATED BALANCE SHEETS - (Unaudited)
					September		June		March		December		September
			($ in thousands)		2021		2021		2021		2020		2020
ASSETS
	Cash and due from banks				$     138,015		$     154,993		$     206,036		$     140,690		$       94,641
	Interest bearing time deposits				2,651		2,906		3,562		5,823		8,956
	Available-for-sale securities				248,815		211,756		177,918		149,406		130,315
	Loans held for sale				10,335		8,731		8,689		7,234		13,943
	Loans, net of unearned income				846,548		850,513		848,176		872,723		885,850
	Allowance for loan losses				(13,812)		(13,306)		(13,326)		(12,574)		(11,793)
	Premises and equipment, net				23,874		24,343		23,233		23,557		23,785
	Federal Reserve and FHLB Stock, at cost				5,303		5,303		5,303		5,303		5,303
	Foreclosed assets held for sale, net				1,601		1,603		43		23		76
	Interest receivable				2,954		3,000		3,371		3,799		4,159
	Goodwill				22,091		22,091		22,091		22,091		22,091
	Cash value of life insurance				17,795		17,721		17,651		17,530		17,453
	Mortgage servicing rights				11,194		10,678		10,490		7,759		8,535
	Other assets				12,361		12,175		12,630		14,475		14,927
			Total assets		$  1,329,725		$  1,312,507		$  1,325,867		$  1,257,839		$  1,218,241
LIABILITIES AND SHAREHOLDERS' EQUITY
	Deposits
		Non interest bearing demand			$     258,857		$     240,572		$     273,026		$     251,649		$     225,003
		Interest bearing demand			189,130		187,023		191,593		176,785		164,248
		Savings			246,414		235,231		218,260		174,864		169,474
		Money market			258,741		255,512		249,088		216,164		204,862
		Time deposits			158,518		172,696		188,229		229,549		250,428
			Total deposits		1,111,660		1,091,034		1,120,196		1,049,011		1,014,015
	Short-term borrowings				20,771		25,096		24,321		20,189		20,710
	Federal Home Loan Bank advances				5,500		5,500		8,000		8,000		8,000
	Trust preferred securities				10,310		10,310		10,310		10,310		10,310
	Subordinated debt net of issuance costs				19,534		19,522		-		-		-
	Interest payable				576		417		489		616		946
	Other liabilities				17,082		16,611		18,585		26,790		22,913
			Total liabilities		1,185,433		1,168,490		1,181,901		1,114,916		1,076,894
	Shareholders' Equity
		Common stock			54,463		54,463		54,463		54,463		54,463
		Additional paid-in capital			14,875		14,906		14,755		14,845		14,782
		Retained earnings			97,183		93,851		90,883		84,578		80,012
		Accumulated other comprehensive income (loss)			(699)		499		(457)		2,210		2,221
		Treasury stock			(21,530)		(19,702)		(15,678)		(13,173)		(10,131)
			Total shareholders' equity		144,292		144,017		143,966		142,923		141,347
			Total liabilities and shareholders' equity		$  1,329,725		$  1,312,507		$  1,325,867		$  1,257,839		$  1,218,241

 

SB FINANCIAL GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME - (Unaudited)
($ in thousands, except per share & ratios)				At and for the Three Months Ended										Nine Months Ended
				September		June		March		December		September		September		September
Interest income				2021		2021		2021		2020		2020		2021		2020
	Loans
	Taxable			$        9,948		$        9,196		$        9,926		$        9,816		$     10,179		$     29,070		$     29,919
	Tax exempt			52		47		48		54		47		147		185
	Securities
	Taxable			939		835		643		632		494		2,417		1,696
	Tax exempt			94		85		88		87		87		267		246
		Total interest income		11,033		10,163		10,705		10,589		10,807		31,901		32,046
Interest expense
	Deposits			709		818		962		1,218		1,423		2,489		4,852
	Repurchase agreements & other			12		12		11		10		12		35		60
	Federal Home Loan Bank advances			40		51		56		58		59		147		251
	Trust preferred securities			49		50		51		52		54		150		204
	Subordinated debt			199		75		-		-		-		274		-
		Total interest expense		1,009		1,006		1,080		1,338		1,548		3,095		5,367
Net interest income				10,024		9,157		9,625		9,251		9,259		28,806		26,679
	Provision for loan losses			300		-		750		800		1,800		1,050		3,700
Net interest income after provision
for loan losses				9,724		9,157		8,875		8,451		7,459		27,756		22,979
Noninterest income
	Wealth management fees			959		955		912		863		839		2,826		2,382
	Customer service fees			812		820		758		728		730		2,390		2,079
	Gain on sale of mtg. loans & OMSR			3,947		4,255		5,859		7,197		8,085		14,061		18,153
	Mortgage loan servicing fees, net			155		(217)		2,378		(1,037)		(169)		2,316		(4,101)
	Gain on sale of non-mortgage loans			52		45		17		123		119		114		330
	Title insurance revenue			508		532		521		522		517		1,561		1,391
	Gain (loss) on sale of assets			1		2		(2)		181		(52)		1		(178)
	Other			215		145		479		325		349		839		1,138
		Total noninterest income		6,649		6,537		10,922		8,902		10,418		24,108		21,194
Noninterest expense
	Salaries and employee benefits			6,689		6,881		6,620		6,556		6,995		20,190		18,841
	Net occupancy expense			714		748		740		782		736		2,202		2,109
	Equipment expense			872		778		732		818		888		2,382		2,368
	Data processing fees			671		653		534		633		586		1,858		2,422
	Professional fees			817		574		764		631		695		2,155		2,676
	Marketing expense			201		220		135		172		137		556		486
	Telephone and communication expense			140		139		154		156		142		433		379
	Postage and delivery expense			100		97		111		108		96		308		307
	State, local and other taxes			286		278		323		299		331		887		847
	Employee expense			186		161		153		103		155		500		432
	Other expenses			580		547		643		426		574		1,770		1,536
		Total noninterest expense		11,256		11,076		10,909		10,684		11,335		33,241		32,403
Income before income tax expense				5,117		4,618		8,888		6,669		6,542		18,623		11,770
	Income tax expense			1,014		857		1,807		1,311		1,292		3,678		2,184
Net income				$        4,103		$        3,761		$        7,081		$        5,358		$        5,250		$     14,945		$        9,586
Common share data:
	Basic earnings per common share			$          0.59		$          0.53		$          0.97		$          0.71		$          0.69		$          2.09		$          1.25
	Diluted earnings per common share			$          0.58		$          0.52		$          0.97		$          0.71		$          0.69		$          2.08		$          1.25
Average shares outstanding (in thousands):
	Basic:			6,966		7,148		7,317		7,487		7,607		7,142		7,700
	Diluted:			7,017		7,200		7,335		7,487		7,607		7,167		7,700

 

SB FINANCIAL GROUP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS - (Unaudited)
($ in thousands, except per share & ratios)		At and for the Three Months Ended										Nine Months Ended
		September		June		March		December		September		September		September
SUMMARY OF OPERATIONS		2021		2021		2021		2020		2020		2021		2020
Net interest income		$     10,024		$     9,157		$     9,625		$     9,251		$     9,259		$       28,806		$       26,679
Tax-equivalent adjustment		39		35		36		37		36		110		115
Tax-equivalent net interest income		10,063		9,192		9,661		9,288		9,295		28,916		26,794
Provision for loan loss		300		-		750		800		1,800		1,050		3,700
Noninterest income		6,649		6,537		10,922		8,902		10,418		24,108		21,194
Total operating revenue		16,673		15,694		20,547		18,153		19,677		52,914		47,873
Noninterest expense		11,256		11,076		10,909		10,684		11,335		33,241		32,403
Pre-tax pre-provision income		5,417		4,618		9,638		7,469		8,342		19,673		15,470
Pretax income		5,117		4,618		8,888		6,669		6,542		18,623		11,770
Net income		4,103		3,761		7,081		5,358		5,250		14,945		9,586
PER SHARE INFORMATION:
Basic earnings per share (EPS)		0.59		0.53		0.97		0.71		0.69		2.09		1.25
Diluted earnings per share		0.58		0.52		0.97		0.71		0.69		2.08		1.25
Common dividends		0.110		0.110		0.105		0.105		0.100		0.325		0.295
Book value per common share		20.83		20.50		19.88		19.39		18.73		20.83		18.73
Tangible book value per common share (TBV)		17.55		17.27		16.74		16.30		15.72		17.55		15.72
Market price per common share		18.18		18.50		18.26		18.28		13.49		18.18		13.49
Market price to TBV		103.6%		107.2%		109.1%		112.1%		85.8%		103.6%		85.8%
Market price to trailing 12 month EPS		6.5		6.4		6.4		9.3		8.0		6.5		8.0
PERFORMANCE RATIOS:
Return on average assets (ROAA)		1.23%		1.13%		2.21%		1.73%		1.73%		1.51%		1.12%
Pre-tax pre-provision ROAA		1.63%		1.39%		3.01%		2.41%		2.74%		2.12%		1.81%
Return on average equity		11.35%		10.42%		19.78%		15.05%		15.01%		13.84%		9.74%
Return on average tangible equity		13.47%		12.37%		23.52%		17.91%		17.93%		16.43%		11.48%
Efficiency ratio		67.40%		70.46%		53.01%		58.76%		57.48%		62.72%		67.63%
Earning asset yield		3.52%		3.25%		3.56%		3.66%		3.96%		3.44%		4.08%
Cost of interest bearing liabilities		0.44%		0.44%		0.50%		0.64%		0.75%		0.46%		0.91%
Net interest margin		3.20%		2.93%		3.20%		3.20%		3.39%		3.11%		3.39%
Tax equivalent effect		0.01%		0.01%		0.01%		0.01%		0.02%		0.01%		0.02%
Net interest margin, tax equivalent		3.21%		2.94%		3.21%		3.21%		3.41%		3.12%		3.41%
Non interest income/Average assets		1.99%		1.97%		3.41%		2.87%		3.42%		2.44%		2.48%
Non interest expense/Average assets		3.38%		3.33%		3.40%		3.45%		3.73%		3.37%		3.79%
Net noninterest expense/Average assets		-1.38%		-1.37%		0.00%		-0.58%		-0.31%		-0.93%		-1.31%
ASSET QUALITY RATIOS:
Gross charge-offs		24		26		52		57		32		102		686
Recoveries		230		6		54		39		11		290		24
Net charge-offs		(206)		20		(2)		18		21		(188)		662
Nonaccruing loans/Total loans		0.38%		0.43%		0.66%		0.74%		0.72%		0.38%		0.72%
Nonperforming loans/Total loans		0.47%		0.51%		0.76%		0.83%		0.81%		0.47%		0.81%
Nonperforming assets/Loans & OREO		0.66%		0.70%		0.76%		0.83%		0.82%		0.66%		0.82%
Nonperforming assets/Total assets		0.42%		0.46%		0.49%		0.58%		0.60%		0.42%		0.60%
Allowance for loan loss/Nonperforming loans		345.91%		304.28%		207.28%		173.77%		163.84%		345.91%		163.84%
Allowance for loan loss/Total loans		1.63%		1.56%		1.57%		1.44%		1.33%		1.63%		1.33%
Net loan charge-offs/Average loans (ann.)		(0.10%)		0.01%		(0.00%)		0.01%		0.01%		(0.03%)		0.10%
Loan loss provision/Net charge-offs		(145.63%)		0.00%		(37500.00%)		4444.44%		8571.43%		(558.51%)		558.91%
CAPITAL & LIQUIDITY RATIOS:
Loans/ Deposits		76.15%		77.95%		75.72%		83.19%		87.36%		76.15%		87.36%
Equity/ Assets		10.85%		10.97%		10.86%		11.36%		11.60%		10.85%		11.60%
Tangible equity/Tangible assets		9.30%		9.41%		9.30%		9.73%		9.92%		9.30%		9.92%
Common equity tier 1 ratio (Bank)		13.23%		13.11%		13.08%		12.91%		12.71%		13.51%		12.71%
END OF PERIOD BALANCES
Total assets		1,329,725		1,312,507		1,325,867		1,257,839		1,218,241		1,329,725		1,218,241
Total loans		846,548		850,513		848,176		872,723		885,850		846,548		885,850
Deposits		1,111,660		1,091,034		1,120,196		1,049,011		1,014,015		1,111,660		1,014,015
Stockholders equity		144,292		144,017		143,966		142,923		141,347		144,292		141,347
Goodwill and intangibles		22,692		22,710		22,728		22,745		22,813		22,692		22,813
Tangible equity		121,600		121,307		121,238		120,178		118,534		121,600		118,534
Mortgage servicing portfolio		1,341,439		1,323,804		1,304,097		1,299,698		1,293,037		1,341,439		1,293,037
Wealth/Brokerage assets under care		588,319		600,904		576,503		558,409		522,360		588,319		522,360
Total assets under care		3,259,483		3,237,215		3,206,467		3,115,946		3,033,638		3,259,483		3,033,638
Full-time equivalent employees		264		256		246		244		251		264		251
Period end common shares outstanding		6,927		7,026		7,242		7,372		7,545		6,927		7,545
Market capitalization (all)		125,935		129,984		132,239		134,760		101,782		125,935		101,782
AVERAGE BALANCES
Total assets		1,333,369		1,329,348		1,281,635		1,238,790		1,216,843		1,315,521		1,141,008
Total earning assets		1,253,722		1,251,213		1,203,284		1,156,718		1,090,386		1,236,227		1,047,846
Total loans		856,486		853,794		862,898		893,244		907,483		857,703		879,536
Deposits		1,109,491		1,115,186		1,073,641		1,031,649		1,007,679		1,099,892		936,805
Stockholders equity		144,565		144,315		143,167		142,418		139,908		144,020		131,156
Goodwill and intangibles		22,701		22,718		22,736		22,754		22,787		22,718		19,813
Tangible equity		121,864		121,597		120,431		119,664		117,121		121,302		111,343
Average basic shares outstanding		6,966		7,148		7,317		7,487		7,607		7,142		7,700
Average diluted shares outstanding		7,017		7,200		7,335		7,487		7,607		7,167		7,700

 

SB FINANCIAL GROUP, INC.
	Rate Volume Analysis - (Unaudited)
	At and for the Three and Nine Months Ended September 30, 2021 and 2020
	($ in thousands)		Three Months Ended Sep. 30, 2021					Three Months Ended Sep. 30, 2020
			Average		Average			Average		Average
Assets			Balance	Interest	Rate			Balance	Interest	Rate
	Taxable securities/cash		$           388,800	$                 939	0.97%			$           176,821	$                 494	1.12%
	Nontaxable securities		8,436	94	4.46%			6,082	87	5.72%
	Loans, net		856,486	10,000	4.67%			907,483	10,226	4.51%
	Total earning assets		1,253,722	11,033	3.52%			1,090,386	10,807	3.96%
	Cash and due from banks		6,975					53,532
	Allowance for loan losses		(13,475)					(10,448)
	Premises and equipment		25,820					23,968
	Other assets		60,327					59,405
	Total assets		$        1,333,369					$        1,216,843
Liabilities
	Savings, MMDA and interest bearing demand		$           695,801	$                 441	0.25%			$           531,913	$                 690	0.52%
	Time deposits		164,432	268	0.65%			254,381	733	1.15%
	Repurchase agreements & other		24,672	12	0.19%			23,811	12	0.20%
	Advances from Federal Home Loan Bank		5,500	40	2.91%			8,272	59	2.85%
	Trust preferred securities		10,310	49	1.90%			10,310	54	2.10%
	Subordinated debt		19,528	199	4.08%			-	-	0.00%
	Total interest bearing liabilities		920,243	1,009	0.44%			828,687	1,548	0.75%
	Non interest bearing demand		249,258	-				221,385	-
	Total funding		1,169,501		0.35%			1,050,072		0.59%
	Other liabilities		19,303					26,863
	Total liabilities		1,188,804					1,076,935
	Equity		144,565					139,908
	Total liabilities and equity		$        1,333,369					$        1,216,843
	Net interest income			$            10,024					$              9,259
	Net interest income as a percent of average interest-earning assets - GAAP measure				3.20%					3.40%
	Net interest income as a percent of average interest-earning assets - non GAAP				3.21%					3.41%
	- Computed on a fully tax equivalent (FTE) basis
			Nine Months Ended Sep. 30, 2021					Nine Months Ended Sep. 30, 2020
			Average		Average			Average		Average
Assets			Balance	Interest	Rate			Balance	Interest	Rate
	Taxable securities/cash		$           370,743	$              2,417	0.87%			$           161,947	$              1,696	1.40%
	Nontaxable securities		7,781	267	4.58%			6,363	246	5.15%
	Loans, net		857,703	29,217	4.54%			879,536	30,104	4.56%
	Total earning assets		1,236,227	31,901	3.44%			1,047,846	32,046	4.08%
	Cash and due from banks		7,554					28,040
	Allowance for loan losses		(13,297)					(9,560)
	Premises and equipment		24,442					23,855
	Other assets		60,595					50,827
	Total assets		$        1,315,521					$        1,141,008
Liabilities
	Savings, MMDA and interest bearing demand		$           661,433	$              1,413	0.28%			$           483,156	$              2,550	0.70%
	Time deposits		184,668	1,076	0.78%			253,398	2,302	1.21%
	Repurchase agreements & Other		24,139	35	0.19%			21,856	60	0.37%
	Advances from Federal Home Loan Bank		6,846	147	2.86%			16,263	251	2.06%
	Trust preferred securities		10,310	150	1.94%			10,310	204	2.64%
	Subordinated debt		9,811	274	3.72%			-	-	0.00%
	Total interest bearing liabilities		897,207	3,095	0.46%			784,983	5,367	0.91%
	Non interest bearing demand		253,791		0.36%			200,251		0.73%
	Total funding		1,150,998					985,234
	Other liabilities		20,503					24,618
	Total liabilities		1,171,501					1,009,852
	Equity		144,020					131,156
	Total liabilities and equity		$        1,315,521					$        1,141,008
	Net interest income			$            28,806					$            26,679
	Net interest income as a percent of average interest-earning assets - GAAP measure				3.11%					3.39%
	Net interest income as a percent of average interest-earning assets - non GAAP				3.12%					3.41%
	- Computed on a fully tax equivalent (FTE) basis

 

Non-GAAP reconciliation		Three Months Ended				Nine Months Ended
($ in thousands, except per share & ratios)		Sep. 30, 2021		Sep. 30, 2020		Sep. 30, 2021		Sep. 30, 2020
Total Operating Revenue		$         16,673		$         19,677		$         52,914		$         47,873
Adjustment to (deduct)/add OMSR recapture/impairment*		(248)		(326)		(2,854)		2,974
Adjusted Total Operating Revenue		16,425		19,351		50,060		50,847
Total Operating Expense		$         11,256		$         11,335		$         33,241		$         32,403
Adjustment for merger expenses**		-		-		-		(1,241)
Adjusted Total Operating Expense		11,256		11,335		33,241		31,162
Income before Income Taxes		5,117		6,542		18,623		11,770
Adjustment for OMSR & merger expenses		(248)		(326)		(2,854)		4,215
Adjusted Income before Income Taxes		4,869		6,216		15,769		15,985
Provision for Income Taxes		1,014		1,292		3,678		2,184
Adjustment for OMSR & merger expenses***		(52)		(68)		(599)		885
Adjusted Provision for Income Taxes		962		1,224		3,079		3,070
Net Income		4,103		5,250		14,945		9,586
Adjustment for OMSR & merger expenses		(196)		(258)		(2,255)		3,330
Adjusted Net Income		3,907		4,992		12,690		12,917
Diluted Earnings per Share		0.58		0.69		2.08		1.25
Adjustment for OMSR & merger expenses		(0.03)		(0.04)		(0.31)		0.42
Adjusted Diluted Earnings per Share		$            0.56		$            0.65		$            1.77		$            1.67
Return on Average Assets		1.23%		1.73%		1.51%		1.12%
Adjustment for OMSR & merger expenses		-0.06%		-0.08%		-0.17%		0.29%
Adjusted Return on Average Assets		1.17%		1.64%		1.34%		1.41%
*valuation adjustment to the Company's mortgage servicing rights
**transaction costs related to the Edon acquisition
***tax effect is calculated using a 21% statutory federal corporate income tax rate

 

View original content:https://www.prnewswire.com/news-releases/sb-financial-group-announces-third-quarter-2021-results-301411470.html

SOURCE SB Financial Group, Inc.

FAQ

What were SB Financial Group's Q3 2021 net income figures?

SB Financial reported a net income of $4.1 million for Q3 2021.

How did SB Financial's earnings per share change in Q3 2021?

The diluted earnings per share (EPS) decreased by 15.9% year-over-year to $0.58.

What is the current status of SB Financial's mortgage origination volume as of Q3 2021?

Mortgage origination volume decreased by 23.8% to $152.6 million in Q3 2021.

How much did SB Financial's total deposits increase by Q3 2021?

Total deposits increased by 9.6% to $1.11 billion as of September 30, 2021.

What changes occurred in SB Financial's nonperforming assets for Q3 2021?

Nonperforming assets decreased by 23.1% from the previous year.