Sterling Bancorp Reports Fourth Quarter and Full Year 2023 Financial Results
- Net income improved significantly compared to the previous year
- Nonperforming assets decreased by 77% from the previous year
- Shareholders’ equity increased to $327.7 million
- Total assets decreased by 1% from the previous quarter
- Total gross loans declined by 19% from the previous year
Insights
The reported financial results of Sterling Bancorp, Inc. for the quarter and year ended December 31, 2023, reflect a significant year-over-year turnaround, moving from a net loss in 2022 to a net profit in 2023. This performance indicates a recovery trajectory, which is critical for investor confidence. The company's net interest margin (NIM), a key indicator of bank profitability, shows a contraction compared to the previous year. While the NIM decrease is consistent with broader industry trends in a rising rate environment, it is worth noting that the margin compression may impact future earnings potential.
Furthermore, the reduction in non-interest expenses, particularly professional fees associated with government investigations that have now been resolved, suggests improved operational efficiency. However, the exhaustion of the directors and officers insurance coverage and the expectation of continuing legal expenses could be a concern for future profitability. Additionally, the decline in the loan portfolio and the strategic decision to not introduce new lending products could signal a conservative risk posture or a reevaluation of the bank's core business strategies. Investors should monitor how these factors might affect the bank's growth prospects.
The current economic environment, characterized by elevated interest rates and cautious capital markets, particularly for community banks like Sterling Bancorp, presents both challenges and opportunities. The bank's decision to maintain market interest rates on deposits to preserve liquidity and customer base is a strategic move to navigate the competitive banking landscape. However, this could pressure the bank's net interest income if deposit costs continue to rise.
Moreover, the bank's strong capital position, with a leverage ratio well above the regulatory minimum, provides a buffer against potential economic downturns and positions it favorably for potential strategic combinations. The bank's mention of patience in awaiting improved market conditions before pursuing new strategies suggests a long-term view that may align with conservative investor strategies. The increase in shareholders' equity, primarily due to the reduction in unrealized losses on investment securities, also indicates resilience amid market volatility and could be a positive signal for investors seeking stability.
The resolution of government investigations and the associated decline in legal costs are positive developments for Sterling Bancorp. However, the company's acknowledgment of ongoing legal expenses related to government inquiries into certain individuals and the depletion of insurance coverage for such costs is a reminder of the potential for unforeseen legal liabilities that can impact financial performance. The bank's commitment under the Plea Agreement with the DOJ will likely continue to require resources, which could affect the bank's administrative expenses and overall profitability.
Investors should appreciate the transparency provided by the bank regarding these matters, as it allows for a more informed assessment of the bank's risk profile. It is also prudent for stakeholders to consider the implications of any future legal developments and their potential impact on the bank's financial health and strategic direction.
Fourth Quarter and Year-End 2023 Highlights
-
Fourth quarter net income of
$5.1 million $0.10 $7.4 million $0.15 -
Fourth quarter net interest margin of
2.52% ; full year net interest margin of2.68% -
Fourth quarter provision for (recovery of) credit losses of
$(4.4) million $(8.5) million -
Nonperforming assets of
$9.0 million 0.37% of total assets -
Ratio of allowance for credit losses to total loans of
2.18% -
Total gross loans of
$1.3 billion -
Fourth quarter non-interest expense of
$12.8 million $65.7 million -
Total deposits of
$2.0 billion -
Shareholders’ equity of
$327.7 million -
Company’s consolidated and Bank’s leverage ratio of
13.95% and13.38% , respectively
The Company reported net income of
Thomas M. O’Brien, Chairman, President, and Chief Executive Officer commented:
“Sterling’s fourth quarter reflects continuing improvement in our expense management as the government investigations directed at Sterling have been resolved. However, we continued to bear expenses from certain indemnified individuals who are responding to government inquiries. In the fourth quarter, those expenses were approximately
Going forward, we believe the impact of the elevated interest rate environment, particularly on deposit prices, will not likely improve in the near-term, although the pace of the rise in deposit costs has slowed. We continually evaluate our strategic position and alternatives, and currently believe that prevailing economic conditions and the lack of a robust capital market for community banks create significant limitations on pursuing a new strategic direction. Accordingly, we have elected to be patient and wait for market conditions to improve before pursuing new strategies. This approach could also create opportunities for potential strategic combinations. In the meantime, we believe we have positioned Sterling well to protect our strengths, namely: strong capital, strong liquidity and solid credit quality.”
Balance Sheet
Total Assets – Total assets were
Cash and due from banks increased
Total gross loans held for investment of
Total Deposits – Total deposits were
Money market, savings and NOW deposits of
Borrowings – Federal Home Loan Bank borrowings were
Capital – Total shareholders’ equity was
At December 31, 2023, the Company’s consolidated and the Bank’s leverage ratio were
Asset Quality and Recovery of Credit Losses – A recovery of credit losses of
Recoveries during the fourth and third quarter of 2023 were
Nonperforming assets at December 31, 2023 totaled
Results of Operations
Net Interest Income and Net Interest Margin – Net interest income for the fourth quarter of 2023 was
Net interest income for the year ended December 31, 2023 was
Non-Interest Income – Non-interest income for the fourth quarter of 2023 was
Non-interest income for the year ended December 31, 2023 was
Non-Interest Expense – Non-interest expense for the fourth quarter of 2023 was
Non-interest expense for the year ended December 31, 2023 was
Income Tax Expense – For the year ended December 31, 2023, the Company recorded income tax expense of
Conference Call and Webcast
Management will host a conference call on Wednesday, January 24, 2024 at 11:00 a.m. Eastern Time to discuss the Company’s unaudited financial results for the quarter and year ended December 31, 2023. The conference call number for
A replay of the conference call may be accessed through January 31, 2024 by
About Sterling Bancorp, Inc.
Sterling Bancorp, Inc. is a unitary thrift holding company. Its wholly owned subsidiary, Sterling Bank and Trust, F.S.B., has primary branch operations in
Forward-Looking Statements
This Press Release contains certain statements that are, or may be deemed to be, “forward-looking statements” regarding the Company’s plans, expectations, thoughts, beliefs, estimates, goals and outlook for the future. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance, including any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. These statements are often, but not always, made through the use of words or phrases such as “may,” “might,” “should,” “could,” “believe,” “expect,” “continue,” “will,” “estimate,” “plan,” “anticipate” and “would” or the negative versions of those words or other comparable words or phrases of a future or forward-looking nature, though the absence of these words does not mean a statement is not forward-looking. All statements other than statements of historical facts, including but not limited to statements regarding, the economy and financial markets, government investigations, credit quality, the regulatory scheme governing our industry, competition in our industry, interest rates, our liquidity, our business and our governance, are forward-looking statements. We have based the forward-looking statements in this Press Release primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, prospects, business strategy and financial needs. These forward-looking statements are not historical facts, and they are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. There can be no assurance that future developments will be those that have been anticipated. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. The risks, uncertainties and other factors detailed from time to time in our public filings, including those included in the disclosures under the headings “Cautionary Note Regarding Forward-Looking Statements” in our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 9, 2023 and “Risk Factors” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 16, 2023, subsequent periodic reports and future periodic reports, could affect future results and events, causing those results and events to differ materially from those views expressed or implied in the Company’s forward-looking statements. These risks are not exhaustive. Other sections of this Press Release and our filings with the Securities and Exchange Commission include additional factors that could adversely impact our business and financial performance. Moreover, we operate in very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Press Release. Should one or more of the foregoing risks materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those projected in, or implied by, such forward-looking statements. Accordingly, you should not place undue reliance on any such forward-looking statements. The Company disclaims any obligation to update, revise, or correct any forward-looking statements based on the occurrence of future events, the receipt of new information or otherwise.
| Sterling Bancorp, Inc. | ||||||||||||||||||||
| Consolidated Financial Highlights (Unaudited) | ||||||||||||||||||||
At and for the Three Months Ended |
|
At and for the Year Ended |
||||||||||||||||||
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
December 31, |
||||||||||||
| (dollars in thousands, except per share data) | 2023 |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||||||||
| Net income (loss) | $ |
5,063 |
|
$ |
314 |
|
$ |
(18,433 |
) |
$ |
7,413 |
|
$ |
(14,194 |
) |
|||||
| Income (loss) per share, diluted | $ |
0.10 |
|
$ |
0.01 |
|
$ |
(0.37 |
) |
$ |
0.15 |
|
$ |
(0.28 |
) |
|||||
| Net interest income | $ |
15,105 |
|
$ |
15,994 |
|
$ |
18,521 |
|
$ |
64,959 |
|
$ |
78,802 |
|
|||||
| Net interest margin |
|
2.52 |
% |
|
2.62 |
% |
|
3.09 |
% |
|
2.68 |
% |
|
3.06 |
% |
|||||
| Non-interest income | $ |
213 |
|
$ |
384 |
|
$ |
248 |
|
$ |
2,786 |
|
$ |
1,347 |
|
|||||
| Non-interest expense | $ |
12,830 |
|
$ |
17,702 |
|
$ |
37,110 |
|
$ |
65,710 |
|
$ |
97,648 |
|
|||||
| Loans, net of allowance for credit losses | $ |
1,319,568 |
|
$ |
1,382,860 |
|
$ |
1,613,385 |
|
$ |
1,319,568 |
|
$ |
1,613,385 |
|
|||||
| Total deposits | $ |
2,003,986 |
|
$ |
2,040,658 |
|
$ |
1,954,037 |
|
$ |
2,003,986 |
|
$ |
1,954,037 |
|
|||||
| Asset Quality | ||||||||||||||||||||
| Nonperforming loans | $ |
8,973 |
|
$ |
6,182 |
|
$ |
33,725 |
|
$ |
8,973 |
|
$ |
33,725 |
|
|||||
| Allowance for credit losses to total loans |
|
2.18 |
% |
|
2.42 |
% |
|
2.74 |
% |
|
2.18 |
% |
|
2.74 |
% |
|||||
| Allowance for credit losses to nonaccrual loans |
|
329 |
% |
|
681 |
% |
|
135 |
% |
|
329 |
% |
|
135 |
% |
|||||
| Nonaccrual loans to total loans outstanding |
|
0.66 |
% |
|
0.36 |
% |
|
2.03 |
% |
|
0.66 |
% |
|
2.03 |
% |
|||||
| Net charge offs (recoveries) to average loans outstanding during the period |
|
0.00 |
% |
|
0.00 |
% |
|
(0.02 |
)% |
|
0.40 |
% |
|
0.06 |
% |
|||||
| Recovery of credit losses | $ |
(4,357 |
) |
$ |
(1,942 |
) |
$ |
(179 |
) |
$ |
(8,527 |
) |
$ |
(9,934 |
) |
|||||
| Net charge offs (recoveries) | $ |
(64 |
) |
$ |
(1 |
) |
$ |
(281 |
) |
$ |
5,945 |
|
$ |
1,150 |
|
|||||
| Performance Ratios | ||||||||||||||||||||
| Return on average assets |
|
0.83 |
% |
|
0.05 |
% |
|
(3.01 |
)% |
|
0.30 |
% |
|
(0.54 |
)% |
|||||
| Return on average shareholders' equity |
|
6.34 |
% |
|
0.39 |
% |
|
(22.15 |
)% |
|
2.35 |
% |
|
(4.19 |
)% |
|||||
| Efficiency ratio (1) |
|
83.76 |
% |
|
108.08 |
% |
|
197.72 |
% |
|
97.00 |
% |
|
121.83 |
% |
|||||
| Yield on average interest-earning assets |
|
5.49 |
% |
|
5.39 |
% |
|
4.54 |
% |
|
5.23 |
% |
|
3.88 |
% |
|||||
| Cost of average interest-bearing liabilities |
|
3.47 |
% |
|
3.24 |
% |
|
1.74 |
% |
|
3.02 |
% |
|
0.98 |
% |
|||||
| Net interest spread |
|
2.02 |
% |
|
2.15 |
% |
|
2.80 |
% |
|
2.21 |
% |
|
2.90 |
% |
|||||
| Capital Ratios(2)(3) | ||||||||||||||||||||
| Regulatory and Other Capital Ratios — Consolidated: | ||||||||||||||||||||
| Tier 1 (core) capital to average total assets (leverage ratio) |
|
13.95 |
% |
|
13.42 |
% |
|
13.54 |
% |
|
13.95 |
% |
|
13.54 |
% |
|||||
| Regulatory and Other Capital Ratios — Bank: | ||||||||||||||||||||
| Tier 1 (core) capital to average total assets (leverage ratio) |
|
13.38 |
% |
|
12.93 |
% |
|
16.56 |
% |
|
13.38 |
% |
|
16.56 |
% |
|||||
| (1) Efficiency ratio is computed as the ratio of non-interest expense divided by the sum of net interest income and non-interest income. | ||||||||||||||||||||
| (2) December 31, 2023 capital ratios are estimated. | ||||||||||||||||||||
| (3) Effective January 1, 2023, the Company and Bank elected to opt into the community bank leverage ratio framework. | ||||||||||||||||||||
| Sterling Bancorp, Inc. | ||||||||||||||||||
| Condensed Consolidated Balance Sheets (Unaudited) | ||||||||||||||||||
December 31, |
|
September 30, |
|
% |
|
December 31, |
|
% |
||||||||||
| (dollars in thousands) | 2023 |
|
2023 |
|
change |
|
2022 |
|
change |
|||||||||
| Assets | ||||||||||||||||||
| Cash and due from banks | $ |
577,967 |
|
$ |
563,622 |
|
3 |
% |
$ |
379,798 |
|
52 |
% |
|||||
| Interest-bearing time deposits with other banks |
|
5,226 |
|
|
1,174 |
|
N/M |
|
|
934 |
|
N/M |
|
|||||
| Debt securities available for sale |
|
419,213 |
|
|
398,302 |
|
5 |
% |
|
343,558 |
|
22 |
% |
|||||
| Equity securities |
|
4,703 |
|
|
4,505 |
|
4 |
% |
|
4,642 |
|
1 |
% |
|||||
| Loans held for sale |
|
— |
|
|
— |
|
N/M |
|
|
7,725 |
|
(100 |
)% |
|||||
| Loans, net of allowance for credit losses of |
|
1,319,568 |
|
|
1,382,860 |
|
(5 |
)% |
|
1,613,385 |
|
(18 |
)% |
|||||
| Accrued interest receivable |
|
8,509 |
|
|
8,854 |
|
(4 |
)% |
|
7,829 |
|
9 |
% |
|||||
| Mortgage servicing rights, net |
|
1,542 |
|
|
1,631 |
|
(5 |
)% |
|
1,794 |
|
(14 |
)% |
|||||
| Leasehold improvements and equipment, net |
|
5,430 |
|
|
5,583 |
|
(3 |
)% |
|
6,301 |
|
(14 |
)% |
|||||
| Operating lease right-of-use assets |
|
11,454 |
|
|
12,197 |
|
(6 |
)% |
|
14,800 |
|
(23 |
)% |
|||||
| Federal Home Loan Bank stock, at cost |
|
18,923 |
|
|
18,923 |
|
0 |
% |
|
20,288 |
|
(7 |
)% |
|||||
| Federal Reserve Bank stock, at cost |
|
9,048 |
|
|
9,001 |
|
1 |
% |
|
— |
|
N/M |
|
|||||
| Company-owned life insurance |
|
8,711 |
|
|
8,658 |
|
1 |
% |
|
8,501 |
|
2 |
% |
|||||
| Deferred tax asset, net |
|
16,959 |
|
|
22,475 |
|
(25 |
)% |
|
23,704 |
|
(28 |
)% |
|||||
| Other assets |
|
8,750 |
|
|
8,888 |
|
(2 |
)% |
|
11,476 |
|
(24 |
)% |
|||||
| Total assets | $ |
2,416,003 |
|
$ |
2,446,673 |
|
(1 |
)% |
$ |
2,444,735 |
|
(1 |
)% |
|||||
| Liabilities | ||||||||||||||||||
| Noninterest-bearing deposits | $ |
35,245 |
|
$ |
40,780 |
|
(14 |
)% |
$ |
53,041 |
|
(34 |
)% |
|||||
| Interest-bearing deposits |
|
1,968,741 |
|
|
1,999,878 |
|
(2 |
)% |
|
1,900,996 |
|
4 |
% |
|||||
| Total deposits |
|
2,003,986 |
|
|
2,040,658 |
|
(2 |
)% |
|
1,954,037 |
|
3 |
% |
|||||
| Federal Home Loan Bank borrowings |
|
50,000 |
|
|
50,000 |
|
0 |
% |
|
50,000 |
|
0 |
% |
|||||
| Subordinated notes, net |
|
— |
|
|
— |
|
N/M |
|
|
65,271 |
|
(100 |
)% |
|||||
| Operating lease liabilities |
|
12,537 |
|
|
13,317 |
|
(6 |
)% |
|
15,990 |
|
(22 |
)% |
|||||
| Other liabilities |
|
21,757 |
|
|
26,595 |
|
(18 |
)% |
|
46,810 |
|
(54 |
)% |
|||||
| Total liabilities |
|
2,088,280 |
|
|
2,130,570 |
|
(2 |
)% |
|
2,132,108 |
|
(2 |
)% |
|||||
| Shareholders’ Equity | ||||||||||||||||||
| Preferred stock, authorized 10,000,000 shares; no shares issued and outstanding |
|
— |
|
|
— |
|
— |
|
|
— |
|
— |
|
|||||
| Common stock, no par value, authorized 500,000,000 shares; shares issued and outstanding 52,070,361, 52,072,631 and 50,795,871 |
|
84,323 |
|
|
84,323 |
|
0 |
% |
|
83,295 |
|
1 |
% |
|||||
| Additional paid-in capital |
|
16,660 |
|
|
15,882 |
|
5 |
% |
|
14,808 |
|
13 |
% |
|||||
| Retained earnings |
|
241,964 |
|
|
236,901 |
|
2 |
% |
|
234,049 |
|
3 |
% |
|||||
| Accumulated other comprehensive loss |
|
(15,224 |
) |
|
(21,003 |
) |
28 |
% |
|
(19,525 |
) |
22 |
% |
|||||
| Total shareholders’ equity |
|
327,723 |
|
|
316,103 |
|
4 |
% |
|
312,627 |
|
5 |
% |
|||||
| Total liabilities and shareholders’ equity | $ |
2,416,003 |
|
$ |
2,446,673 |
|
(1 |
)% |
$ |
2,444,735 |
|
(1 |
)% |
|||||
| N/M - Not Meaningful | ||||||||||||||||||
| Sterling Bancorp, Inc. | |||||||||||||||||||||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | |||||||||||||||||||||||||||||
Three Months Ended |
|
Year Ended |
|||||||||||||||||||||||||||
December 31, |
|
September 30, |
|
% |
|
December 31, |
|
% |
|
December 31, |
|
December 31, |
|
% |
|||||||||||||||
| (dollars in thousands, except per share amounts) | 2023 |
|
2023 |
|
change |
|
2022 |
|
change |
|
2023 |
|
2022 |
|
change |
||||||||||||||
| Interest income | |||||||||||||||||||||||||||||
| Interest and fees on loans | $ |
20,969 |
|
$ |
21,663 |
|
(3 |
)% |
$ |
21,786 |
|
(4 |
)% |
$ |
86,684 |
|
$ |
87,375 |
|
(1 |
)% |
||||||||
| Interest and dividends on investment securities and restricted stock |
|
3,800 |
|
|
3,134 |
|
21 |
% |
|
2,293 |
|
66 |
% |
|
12,056 |
|
|
6,426 |
|
88 |
% |
||||||||
| Interest on interest-bearing cash deposits |
|
8,159 |
|
|
8,081 |
|
1 |
% |
|
3,200 |
|
N/M |
|
|
28,049 |
|
|
6,131 |
|
N/M |
|
||||||||
| Total interest income |
|
32,928 |
|
|
32,878 |
|
0 |
% |
|
27,279 |
|
21 |
% |
|
126,789 |
|
|
99,932 |
|
27 |
% |
||||||||
| Interest expense | |||||||||||||||||||||||||||||
| Interest on deposits |
|
17,572 |
|
|
16,391 |
|
7 |
% |
|
6,922 |
|
N/M |
|
|
57,109 |
|
|
14,992 |
|
N/M |
|
||||||||
| Interest on Federal Home Loan Bank borrowings |
|
251 |
|
|
250 |
|
0 |
% |
|
250 |
|
0 |
% |
|
994 |
|
|
1,169 |
|
(15 |
)% |
||||||||
| Interest on subordinated notes |
|
— |
|
|
243 |
|
(100 |
)% |
|
1,586 |
|
(100 |
)% |
|
3,727 |
|
|
4,969 |
|
(25 |
)% |
||||||||
| Total interest expense |
|
17,823 |
|
|
16,884 |
|
6 |
% |
|
8,758 |
|
N/M |
|
|
61,830 |
|
|
21,130 |
|
N/M |
|
||||||||
| Net interest income |
|
15,105 |
|
|
15,994 |
|
(6 |
)% |
|
18,521 |
|
(18 |
)% |
|
64,959 |
|
|
78,802 |
|
(18 |
)% |
||||||||
| Recovery of credit losses |
|
(4,357 |
) |
|
(1,942 |
) |
N/M |
|
|
(179 |
) |
N/M |
|
|
(8,527 |
) |
|
(9,934 |
) |
14 |
% |
||||||||
| Net interest income after recovery of credit losses |
|
19,462 |
|
|
17,936 |
|
9 |
% |
|
18,700 |
|
4 |
% |
|
73,486 |
|
|
88,736 |
|
(17 |
)% |
||||||||
| Non-interest income | |||||||||||||||||||||||||||||
| Service charges and fees |
|
75 |
|
|
97 |
|
(23 |
)% |
|
84 |
|
(11 |
)% |
|
344 |
|
|
435 |
|
(21 |
)% |
||||||||
| Gain (loss) on sale of investment securities |
|
(111 |
) |
|
— |
|
N/M |
|
|
32 |
|
N/M |
|
|
(113 |
) |
|
32 |
|
N/M |
|
||||||||
| Gain (loss) on sale of loans held for sale |
|
(72 |
) |
|
— |
|
N/M |
|
|
(57 |
) |
(26 |
)% |
|
1,623 |
|
|
143 |
|
N/M |
|
||||||||
| Unrealized gain (loss) on equity securities |
|
198 |
|
|
(137 |
) |
N/M |
|
|
10 |
|
N/M |
|
|
61 |
|
|
(580 |
) |
N/M |
|
||||||||
| Net servicing income (loss) |
|
40 |
|
|
107 |
|
(63 |
)% |
|
98 |
|
(59 |
)% |
|
308 |
|
|
(20 |
) |
N/M |
|
||||||||
| Income earned on company-owned life insurance |
|
83 |
|
|
83 |
|
0 |
% |
|
81 |
|
2 |
% |
|
327 |
|
|
751 |
|
(56 |
)% |
||||||||
| Other |
|
— |
|
|
234 |
|
(100 |
)% |
|
— |
|
N/M |
|
|
236 |
|
|
586 |
|
(60 |
)% |
||||||||
| Total non-interest income |
|
213 |
|
|
384 |
|
(45 |
)% |
|
248 |
|
(14 |
)% |
|
2,786 |
|
|
1,347 |
|
N/M |
|
||||||||
| Non-interest expense | |||||||||||||||||||||||||||||
| Salaries and employee benefits |
|
8,500 |
|
|
8,753 |
|
(3 |
)% |
|
8,985 |
|
(5 |
)% |
|
35,937 |
|
|
33,507 |
|
7 |
% |
||||||||
| Occupancy and equipment |
|
2,096 |
|
|
2,110 |
|
(1 |
)% |
|
2,216 |
|
(5 |
)% |
|
8,369 |
|
|
8,657 |
|
(3 |
)% |
||||||||
| Professional fees |
|
(908 |
) |
|
4,242 |
|
N/M |
|
|
5,929 |
|
N/M |
|
|
10,076 |
|
|
23,908 |
|
(58 |
)% |
||||||||
| FDIC insurance |
|
264 |
|
|
274 |
|
(4 |
)% |
|
115 |
|
N/M |
|
|
1,058 |
|
|
1,146 |
|
(8 |
)% |
||||||||
| Data processing |
|
704 |
|
|
745 |
|
(6 |
)% |
|
766 |
|
(8 |
)% |
|
2,941 |
|
|
3,058 |
|
(4 |
)% |
||||||||
| Net provision for (recovery of) mortgage repurchase liability |
|
(40 |
) |
|
(80 |
) |
50 |
% |
|
31 |
|
N/M |
|
|
(59 |
) |
|
(639 |
) |
91 |
% |
||||||||
| Provision for contingent losses |
|
— |
|
|
— |
|
N/M |
|
|
18,239 |
|
(100 |
)% |
|
— |
|
|
18,239 |
|
(100 |
)% |
||||||||
| Other |
|
2,214 |
|
|
1,658 |
|
34 |
% |
|
829 |
|
N/M |
|
|
7,388 |
|
|
9,772 |
|
(24 |
)% |
||||||||
| Total non-interest expense |
|
12,830 |
|
|
17,702 |
|
(28 |
)% |
|
37,110 |
|
(65 |
)% |
|
65,710 |
|
|
97,648 |
|
(33 |
)% |
||||||||
| Income (loss) before income taxes |
|
6,845 |
|
|
618 |
|
N/M |
|
|
(18,162 |
) |
N/M |
|
|
10,562 |
|
|
(7,565 |
) |
N/M |
|
||||||||
| Income tax expense |
|
1,782 |
|
|
304 |
|
N/M |
|
|
271 |
|
N/M |
|
|
3,149 |
|
|
6,629 |
|
(52 |
)% |
||||||||
| Net income (loss) | $ |
5,063 |
|
$ |
314 |
|
N/M |
|
$ |
(18,433 |
) |
N/M |
|
$ |
7,413 |
|
$ |
(14,194 |
) |
N/M |
|
||||||||
| Income (loss) per share, basic and diluted | $ |
0.10 |
|
$ |
0.01 |
|
$ |
(0.37 |
) |
$ |
0.15 |
|
$ |
(0.28 |
) |
||||||||||||||
| Weighted average common shares outstanding: | |||||||||||||||||||||||||||||
| Basic |
|
50,703,220 |
|
|
50,699,967 |
|
|
50,403,310 |
|
|
50,630,928 |
|
|
50,346,198 |
|
||||||||||||||
| Diluted |
|
51,182,011 |
|
|
51,069,683 |
|
|
50,403,310 |
|
|
50,778,559 |
|
|
50,346,198 |
|
||||||||||||||
| N/M - Not Meaningful | |||||||||||||||||||||||||||||
| Sterling Bancorp, Inc. | |||||||||||||||||||||||||||
| Yield Analysis and Net Interest Income (Unaudited) | |||||||||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||||||||
| December 31, 2023 | September 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||
| Average | Average | Average | Average | Average | Average | ||||||||||||||||||||||
| (dollars in thousands) | Balance | Interest | Yield/Rate | Balance | Interest | Yield/Rate | Balance | Interest | Yield/Rate | ||||||||||||||||||
| Interest-earning assets | |||||||||||||||||||||||||||
| Loans(1) | |||||||||||||||||||||||||||
| Residential real estate and other consumer | $ |
1,111,391 |
$ |
17,181 |
6.18 |
% |
$ |
1,174,075 |
$ |
17,546 |
5.98 |
% |
$ |
1,428,840 |
$ |
18,331 |
5.13 |
% |
|||||||||
| Commercial real estate |
|
237,997 |
|
3,065 |
5.15 |
% |
|
228,939 |
|
2,953 |
5.16 |
% |
|
219,414 |
|
2,480 |
4.52 |
% |
|||||||||
| Construction |
|
13,789 |
|
347 |
10.07 |
% |
|
29,337 |
|
786 |
10.72 |
% |
|
45,486 |
|
957 |
8.42 |
% |
|||||||||
| Commercial and industrial |
|
17,611 |
|
376 |
8.54 |
% |
|
17,796 |
|
378 |
8.50 |
% |
|
1,389 |
|
18 |
5.18 |
% |
|||||||||
| Total loans |
|
1,380,788 |
|
20,969 |
6.07 |
% |
|
1,450,147 |
|
21,663 |
5.98 |
% |
|
1,695,129 |
|
21,786 |
5.14 |
% |
|||||||||
| Securities, includes restricted stock(2) |
|
431,994 |
|
3,800 |
3.52 |
% |
|
400,838 |
|
3,134 |
3.13 |
% |
|
370,460 |
|
2,293 |
2.48 |
% |
|||||||||
| Other interest-earning assets |
|
585,703 |
|
8,159 |
5.57 |
% |
|
589,267 |
|
8,081 |
5.49 |
% |
|
335,237 |
|
3,200 |
3.82 |
% |
|||||||||
| Total interest-earning assets |
|
2,398,485 |
|
32,928 |
5.49 |
% |
|
2,440,252 |
|
32,878 |
5.39 |
% |
|
2,400,826 |
|
27,279 |
4.54 |
% |
|||||||||
| Noninterest-earning assets | |||||||||||||||||||||||||||
| Cash and due from banks |
|
3,822 |
|
4,780 |
|
4,221 |
|||||||||||||||||||||
| Other assets |
|
30,305 |
|
29,535 |
|
28,432 |
|||||||||||||||||||||
| Total assets | $ |
2,432,612 |
$ |
2,474,567 |
$ |
2,433,479 |
|||||||||||||||||||||
| Interest-bearing liabilities | |||||||||||||||||||||||||||
| Money market, savings and NOW | $ |
1,116,533 |
$ |
9,745 |
3.46 |
% |
$ |
1,099,070 |
$ |
8,930 |
3.22 |
% |
$ |
1,078,873 |
$ |
3,490 |
1.28 |
% |
|||||||||
| Time deposits |
|
873,928 |
|
7,827 |
3.55 |
% |
|
907,466 |
|
7,461 |
3.26 |
% |
|
799,524 |
|
3,432 |
1.70 |
% |
|||||||||
| Total interest-bearing deposits |
|
1,990,461 |
|
17,572 |
3.50 |
% |
|
2,006,536 |
|
16,391 |
3.24 |
% |
|
1,878,397 |
|
6,922 |
1.46 |
% |
|||||||||
| FHLB borrowings |
|
50,000 |
|
251 |
1.96 |
% |
|
50,000 |
|
250 |
1.96 |
% |
|
50,000 |
|
250 |
1.96 |
% |
|||||||||
| Subordinated notes, net |
|
- |
|
- |
0.00 |
% |
|
9,218 |
|
243 |
10.32 |
% |
|
65,283 |
|
1,586 |
9.51 |
% |
|||||||||
| Total borrowings |
|
50,000 |
|
251 |
1.96 |
% |
|
59,218 |
|
493 |
3.26 |
% |
|
115,283 |
|
1,836 |
6.23 |
% |
|||||||||
| Total interest-bearing liabilities |
|
2,040,461 |
|
17,823 |
3.47 |
% |
|
2,065,754 |
|
16,884 |
3.24 |
% |
|
1,993,680 |
|
8,758 |
1.74 |
% |
|||||||||
| Noninterest-bearing liabilities | |||||||||||||||||||||||||||
| Demand deposits |
|
38,310 |
|
42,355 |
|
60,615 |
|||||||||||||||||||||
| Other liabilities |
|
36,768 |
|
48,640 |
|
49,036 |
|||||||||||||||||||||
| Shareholders' equity |
|
317,073 |
|
317,818 |
|
330,148 |
|||||||||||||||||||||
| Total liabilities and shareholders' equity | $ |
2,432,612 |
$ |
2,474,567 |
$ |
2,433,479 |
|||||||||||||||||||||
| Net interest income and spread(2) | $ |
15,105 |
2.02 |
% |
$ |
15,994 |
2.15 |
% |
$ |
18,521 |
2.80 |
% |
|||||||||||||||
| Net interest margin(2) | 2.52 |
% |
2.62 |
% |
3.09 |
% |
|||||||||||||||||||||
| (1) Nonaccrual loans are included in the respective average loan balances. Income, if any, on such loans is recognized on a cash basis. | |||||||||||||||||||||||||||
| (2) Interest income does not include taxable equivalence adjustments. | |||||||||||||||||||||||||||
| Year Ended | |||||||||||||||||||||||||||
| December 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||
| Average | Average | Average | Average | ||||||||||||||||||||||||
| (dollars in thousands) | Balance | Interest | Yield/Rate | Balance | Interest | Yield/Rate | |||||||||||||||||||||
| Interest-earning assets | |||||||||||||||||||||||||||
| Loans(1) | |||||||||||||||||||||||||||
| Residential real estate and other consumer | $ |
1,231,559 |
$ |
71,491 |
5.80 |
% |
$ |
1,524,373 |
$ |
71,229 |
4.67 |
% |
|||||||||||||||
| Commercial real estate |
|
228,963 |
|
11,401 |
4.98 |
% |
|
225,480 |
|
10,921 |
4.84 |
% |
|||||||||||||||
| Construction |
|
29,020 |
|
2,987 |
10.29 |
% |
|
63,841 |
|
5,179 |
8.11 |
% |
|||||||||||||||
| Commercial and industrial |
|
9,827 |
|
805 |
8.19 |
% |
|
879 |
|
46 |
5.23 |
% |
|||||||||||||||
| Total loans |
|
1,499,369 |
|
86,684 |
5.78 |
% |
|
1,814,573 |
|
87,375 |
4.82 |
% |
|||||||||||||||
| Securities, includes restricted stock(2) |
|
393,767 |
|
12,056 |
3.06 |
% |
|
377,959 |
|
6,426 |
1.70 |
% |
|||||||||||||||
| Other interest-earning assets |
|
532,789 |
|
28,049 |
5.26 |
% |
|
380,236 |
|
6,131 |
1.61 |
% |
|||||||||||||||
| Total interest-earning assets |
|
2,425,925 |
|
126,789 |
5.23 |
% |
|
2,572,768 |
|
99,932 |
3.88 |
% |
|||||||||||||||
| Noninterest-earning assets | |||||||||||||||||||||||||||
| Cash and due from banks |
|
4,326 |
|
3,942 |
|||||||||||||||||||||||
| Other assets |
|
28,648 |
|
33,547 |
|||||||||||||||||||||||
| Total assets | $ |
2,458,899 |
$ |
2,610,257 |
|||||||||||||||||||||||
| Interest-bearing liabilities | |||||||||||||||||||||||||||
| Money market, savings and NOW | $ |
1,049,818 |
$ |
29,559 |
2.82 |
% |
$ |
1,215,059 |
$ |
7,006 |
0.58 |
% |
|||||||||||||||
| Time deposits |
|
912,966 |
|
27,550 |
3.02 |
% |
|
782,760 |
|
7,986 |
1.02 |
% |
|||||||||||||||
| Total interest-bearing deposits |
|
1,962,784 |
|
57,109 |
2.91 |
% |
|
1,997,819 |
|
14,992 |
0.75 |
% |
|||||||||||||||
| FHLB borrowings |
|
50,000 |
|
994 |
1.99 |
% |
|
89,822 |
|
1,169 |
1.30 |
% |
|||||||||||||||
| Subordinated notes, net |
|
34,683 |
|
3,727 |
10.60 |
% |
|
65,310 |
|
4,969 |
7.50 |
% |
|||||||||||||||
| Total borrowings |
|
84,683 |
|
4,721 |
5.50 |
% |
|
155,132 |
|
6,138 |
3.90 |
% |
|||||||||||||||
| Total interest-bearing liabilities |
|
2,047,467 |
|
61,830 |
3.02 |
% |
|
2,152,951 |
|
21,130 |
0.98 |
% |
|||||||||||||||
| Noninterest-bearing liabilities | |||||||||||||||||||||||||||
| Demand deposits |
|
43,702 |
|
67,953 |
|||||||||||||||||||||||
| Other liabilities |
|
52,220 |
|
50,740 |
|||||||||||||||||||||||
| Shareholders' equity |
|
315,510 |
|
338,613 |
|||||||||||||||||||||||
| Total liabilities and shareholders' equity | $ |
2,458,899 |
$ |
2,610,257 |
|||||||||||||||||||||||
| Net interest income and spread(2) | $ |
64,959 |
2.21 |
% |
$ |
78,802 |
2.90 |
% |
|||||||||||||||||||
| Net interest margin(2) | 2.68 |
% |
3.06 |
% |
|||||||||||||||||||||||
| (1) Nonaccrual loans are included in the respective average loan balances. Income, if any, on such loans is recognized on a cash basis. | |||||||||||||||||||||||||||
| (2) Interest income does not include taxable equivalence adjustments. | |||||||||||||||||||||||||||
| Sterling Bancorp, Inc. | ||||||||||||||||||||
| Loan Composition (Unaudited) | ||||||||||||||||||||
December 31, |
|
September 30, |
|
% |
|
December 31, |
|
% |
||||||||||||
| (dollars in thousands) | 2023 |
|
2023 |
|
change |
|
2022 |
|
change |
|||||||||||
| Residential real estate | $ |
1,085,776 |
|
$ |
1,139,205 |
|
|
(5 |
)% |
$ |
1,391,276 |
|
|
(22 |
)% |
|||||
| Commercial real estate |
|
236,982 |
|
|
237,812 |
|
|
(0 |
)% |
|
221,669 |
|
|
7 |
% |
|||||
| Construction |
|
10,381 |
|
|
22,292 |
|
|
(53 |
)% |
|
44,503 |
|
|
(77 |
)% |
|||||
| Commercial and industrial |
|
15,832 |
|
|
17,809 |
|
|
(11 |
)% |
|
1,396 |
|
|
N/M |
|
|||||
| Other consumer |
|
1 |
|
|
9 |
|
|
(89 |
)% |
|
5 |
|
|
(80 |
)% |
|||||
| Total loans held for investment |
|
1,348,972 |
|
|
1,417,127 |
|
|
(5 |
)% |
|
1,658,849 |
|
|
(19 |
)% |
|||||
| Less: allowance for credit losses |
|
(29,404 |
) |
|
(34,267 |
) |
|
(14 |
)% |
|
(45,464 |
) |
|
(35 |
)% |
|||||
| Loans, net | $ |
1,319,568 |
|
$ |
1,382,860 |
|
|
(5 |
)% |
$ |
1,613,385 |
|
|
(18 |
)% |
|||||
| Loans held for sale | $ |
- |
|
$ |
- |
|
|
N/M |
|
$ |
7,725 |
|
|
(100 |
)% |
|||||
| Total gross loans | $ |
1,348,972 |
|
$ |
1,417,127 |
|
|
(5 |
)% |
$ |
1,666,574 |
|
|
(19 |
)% |
|||||
| N/M - Not Meaningful | ||||||||||||||||||||
| Sterling Bancorp, Inc. | ||||||||||||||||||||
| Allowance for Credit Losses - Loans (Unaudited) | ||||||||||||||||||||
Three Months Ended |
Year Ended | |||||||||||||||||||
December 31, |
September 30, |
December 31, |
December 31, | December 31, | ||||||||||||||||
| (dollars in thousands) | 2023 |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||||||||
| Balance at beginning of period | $ |
34,267 |
|
$ |
36,153 |
|
$ |
45,362 |
|
$ |
45,464 |
|
$ |
56,548 |
|
|||||
| Adjustment to adopt ASU 2016-13 |
|
— |
|
|
— |
|
|
— |
|
|
(1,651 |
) |
|
— |
|
|||||
| Adjustment to adopt ASU 2022-02 |
|
— |
|
|
— |
|
|
— |
|
|
380 |
|
|
— |
|
|||||
| Balance after adoption | $ |
34,267 |
|
$ |
36,153 |
|
$ |
45,362 |
|
$ |
44,193 |
|
$ |
56,548 |
|
|||||
| Provision for (recovery of) credit losses |
|
(4,927 |
) |
|
(1,887 |
) |
|
(179 |
) |
|
(8,844 |
) |
|
(9,934 |
) |
|||||
| Charge offs |
|
— |
|
|
— |
|
|
— |
|
|
(6,478 |
) |
|
(4,261 |
) |
|||||
| Recoveries |
|
64 |
|
|
1 |
|
|
281 |
|
|
533 |
|
|
3,111 |
|
|||||
| Balance at end of period | $ |
29,404 |
|
$ |
34,267 |
|
$ |
45,464 |
|
$ |
29,404 |
|
$ |
45,464 |
|
|||||
| Sterling Bancorp, Inc. | ||||||||||||||||||||
| Deposit Composition (Unaudited) | ||||||||||||||||||||
December 31, |
|
September 30, |
|
% |
|
December 31, |
|
% |
||||||||||||
| (dollars in thousands) | 2023 |
|
2023 |
|
change |
|
2022 |
|
change |
|||||||||||
| Noninterest-bearing deposits | $ |
35,245 |
|
$ |
40,780 |
|
|
(14 |
)% |
$ |
53,041 |
|
|
(34 |
)% |
|||||
| Money Market, Savings and NOW |
|
1,095,521 |
|
|
1,127,735 |
|
|
(3 |
)% |
|
1,039,263 |
|
|
5 |
% |
|||||
| Time deposits |
|
873,220 |
|
|
872,143 |
|
|
0 |
% |
|
861,733 |
|
|
1 |
% |
|||||
| Total deposits | $ |
2,003,986 |
|
$ |
2,040,658 |
|
|
(2 |
)% |
$ |
1,954,037 |
|
|
3 |
% |
|||||
| Sterling Bancorp, Inc. | ||||||||||||||
| Credit Quality Data (Unaudited) | ||||||||||||||
| At and for the Three Months Ended | ||||||||||||||
December 31, |
|
September 30, |
|
December 31, |
||||||||||
| (dollars in thousands) | 2023 |
|
2023 |
|
2022 |
|||||||||
| Nonaccrual loans(1)(2) | ||||||||||||||
| Residential real estate | $ |
8,942 |
|
$ |
5,035 |
|
$ |
33,690 |
|
|||||
| Loans past due 90 days or more and still accruing interest |
|
31 |
|
|
1,147 |
|
|
35 |
|
|||||
| Nonperforming loans |
|
8,973 |
|
|
6,182 |
|
|
33,725 |
|
|||||
| Other troubled debt restructurings(3) |
|
— |
|
|
— |
|
|
2,637 |
|
|||||
| Nonaccrual loans held for sale |
|
— |
|
|
— |
|
|
1,942 |
|
|||||
| Nonperforming assets | $ |
8,973 |
|
$ |
6,182 |
|
$ |
38,304 |
|
|||||
| Total loans (1) | $ |
1,348,972 |
|
$ |
1,417,127 |
|
$ |
1,658,849 |
|
|||||
| Total assets | $ |
2,416,003 |
|
$ |
2,446,673 |
|
$ |
2,444,735 |
|
|||||
| Nonaccrual loans to total loans outstanding (2) |
|
0.66 |
% |
|
0.36 |
% |
|
2.03 |
% |
|||||
| Nonperforming assets to total assets |
|
0.37 |
% |
|
0.25 |
% |
|
1.57 |
% |
|||||
| Allowance for credit losses to total loans |
|
2.18 |
% |
|
2.42 |
% |
|
2.74 |
% |
|||||
| Allowance for credit losses to nonaccrual loans |
|
329 |
% |
|
681 |
% |
|
135 |
% |
|||||
| Net charge offs (recoveries) to average loans outstanding during the period |
|
0.00 |
% |
|
0.00 |
% |
|
(0.02 |
)% |
|||||
| (1) Loans are classified as held for investment and are presented before the allowance for credit losses. | ||||||||||||||
| (2) Total nonaccrual loans exclude nonaccrual loans held for sale. If nonaccrual loans held for sale are included, the ratio of total nonaccrual loans to total gross loans would be |
||||||||||||||
| (3) Other troubled debt restructurings at December 31, 2022 exclude those loans presented above as nonaccrual or past due 90 days or more and still accruing interest. Effective January 1, 2023, loan modifications involving borrowers experiencing financial difficulty are evaluated under the new credit loss model. There were no such loan modifications during the three months ended December 31, 2023 and September 30, 2023. | ||||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240124685142/en/
Investor Contact:
Sterling Bancorp, Inc.
Karen Knott
Executive Vice President and Chief Financial Officer
(248) 359-6624
kzaborney@sterlingbank.com
Source: Sterling Bancorp, Inc.
FAQ
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