Skyline Bankshares, Inc. Announces First Quarter 2024 Results
- Solid loan growth and prudent capital management led to increased dividends and stock repurchases.
- Total assets increased by $4.2 million in the first quarter of 2024.
- Net loans increased to $819.9 million, and total deposits rose to $930.4 million.
- The pending acquisition of Johnson County Bank in Tennessee is expected to strengthen the company's footprint.
- Challenges from higher deposit costs and inflation impacted operating costs.
- None.
FLOYD, Va. and INDEPENDENCE, Va., April 24, 2024 (GLOBE NEWSWIRE) -- Skyline Bankshares, Inc. (the “Company”) (OTC QX: SLBK) – the holding company for Skyline National Bank (the “Bank”) – announced its results of operations for the first quarter of 2024.
The Company recorded net income of
President and CEO Blake Edwards stated, “We are very pleased with our results for the first quarter of 2024, despite the challenges of higher deposit costs, and the impacts of inflation on our operating costs. The solid loan growth we experienced in 2023 continued into the first quarter of 2024 and has helped to offset much of the increase in deposit costs. Prudent capital management also allowed us to increase our dividend by over
Edwards continued, “We expect competition for deposits, increased interest expense, and higher operating costs to continue in the near term, and because of this we expect to see continued pressure on earnings and margins; however, as we have demonstrated, our team will continue to focus on our long-term strategy of growing the Skyline franchise and creating shareholder value with an emphasis on relationship-banking and growing our low-cost core deposit base.”
Edwards concluded, “As a part of this long-term strategy we recently announced our pending entrance into Tennessee through our acquisition of Johnson County Bank, which is expected to close during the second half of 2024. This strategic move is not only rooted in our shared values but also aligns with our growth objectives, presenting an exceptional opportunity to strengthen our footprint as Johnson County Bank is located directly between our existing markets of Boone, North Carolina and Abingdon, Virginia. We are excited to bring our commitment to excellence and dedication to the businesses and people of Johnson County, Tennessee. This is an exciting chapter in the history of our bank and we look forward to welcoming Johnson County Bank into the Skyline family.”
Highlights
- Net income was
$2.1 million , or$0.37 per share, for the first quarter of 2024, compared to$2.7 million , or$0.49 per share, for the first quarter of 2023. - Net interest margin (“NIM”) was
3.64% for the first quarter of 2024, compared to3.69% in the fourth quarter of 2023, and3.89% in the first quarter of 2023. - Total assets increased in the first quarter of 2024 by
$4.2 million , or0.41% , remaining comparable at$1.05 billion at March 31, 2024 and December 31, 2023, respectively, and increased by$31.0 million , or3.04% , from$1.02 billion at March 31, 2023. - Net loans were
$819.9 million at March 31, 2024, an increase of$8.9 million , or1.10% , when compared to$811.0 million at December 31, 2023, and increased$62.1 million when compared to$757.8 million at March 31, 2023. - Total deposits were
$930.4 million at March 31, 2024, an increase of$1.7 million , or0.18% , from$928.7 million at December 31, 2023, and an increase of$24.9 million from$905.5 million at March 31, 2023. - The Company repurchased 20,000 shares of its common stock through its publicly announced share repurchase program during the first quarter of 2024.
First Quarter 2024 Income Statement Review
Net interest income after provision for credit losses in the first quarter of 2024 was
First quarter 2024 noninterest income was
Noninterest expense in the first quarter of 2024 was
Income tax expense decreased by
Balance Sheet Review
Total assets increased in the first quarter of 2024 by
Total loans increased during the first quarter by
Asset quality has remained strong, with a ratio of nonperforming loans to total loans of
Investment securities decreased by
Total deposits increased in the first quarter of 2024 by
Stockholders’ equity remained comparable at
Forward-looking statements
This release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934 as amended. These include statements as to expectations regarding future financial performance and any other statements regarding future results or expectations. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for purposes of these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identified by the use of words such as "believe," "expect," "intend," "anticipate," "estimate," or "project" or similar expressions. Our ability to predict results, or the actual effect of future plans or strategies, is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of the combined company and its subsidiaries include, but are not limited to: changes in interest rates; general economic and financial market conditions; the effect of changes in banking, tax and other laws and regulations and interpretations or guidance thereunder; monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality and composition of the loan and securities portfolios; demand for loan products; deposit flows; competition; demand for financial services in the combined company’s market area; the implementation of new technologies; the ability to develop and maintain secure and reliable electronic systems; accounting principles, policies, and guidelines; the ability to obtain required regulatory and shareholder approvals and meet other closing conditions to the proposed acquisition of Johnson County Bank; the ability to complete the acquisition as expected and within the expected timeframe; disruptions to customer and employee relationships and business operations caused by the acquisition; the ability to implement integration plans associated with the acquisition, which integration may be more difficult, time-consuming or costly than expected; the ability to achieve the cost savings and synergies contemplated by the acquisition within the expected timeframe, or at all; and other factors identified in Item 1A, “Risk Factors,” in the Company’s Annual Report on 10-K for the year ended December 31, 2023. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update or clarify these forward‐looking statements, whether as a result of new information, future events or otherwise.
(See Attached Financial Statements for quarter ending March 31, 2024)
Skyline Bankshares, Inc.
Condensed Consolidated Balance Sheets
March 31, 2024; December 31, 2023; March 31, 2023
| March 31, | December 31, | March 31, | ||||||||||
| (dollars in thousands except share amounts) | 2024 | 2023 | 2023 | |||||||||
| (Unaudited) | (Audited) | (Unaudited) | ||||||||||
| Assets | ||||||||||||
| Cash and due from banks | $ | 13,115 | $ | 16,811 | $ | 25,017 | ||||||
| Interest-bearing deposits with banks | 8,233 | 4,808 | 14,653 | |||||||||
| Federal funds sold | 384 | 474 | 2,378 | |||||||||
| Investment securities available for sale | 122,368 | 127,389 | 136,678 | |||||||||
| Restricted equity securities | 3,609 | 3,338 | 3,014 | |||||||||
| Loans | 826,684 | 817,704 | 764,615 | |||||||||
| Allowance for credit losses | (6,765 | ) | (6,739 | ) | (6,819 | ) | ||||||
| Net loans | 819,919 | 810,965 | 757,796 | |||||||||
| Cash value of life insurance | 23,055 | 22,909 | 22,623 | |||||||||
| Properties and equipment, net | 31,394 | 31,183 | 31,676 | |||||||||
| Accrued interest receivable | 3,450 | 3,463 | 2,888 | |||||||||
| Core deposit intangible | 837 | 917 | 1,181 | |||||||||
| Goodwill | 3,257 | 3,257 | 3,257 | |||||||||
| Deferred tax assets, net | 5,252 | 5,046 | 5,321 | |||||||||
| Other assets | 15,207 | 15,283 | 12,592 | |||||||||
| Total assets | $ | 1,050,080 | $ | 1,045,843 | $ | 1,019,074 | ||||||
| Liabilities | ||||||||||||
| Deposits | ||||||||||||
| Noninterest-bearing | $ | 293,912 | $ | 305,115 | $ | 300,280 | ||||||
| Interest-bearing | 636,529 | 623,627 | 605,175 | |||||||||
| Total deposits | 930,441 | 928,742 | 905,455 | |||||||||
| Borrowings | 30,000 | 27,500 | 25,000 | |||||||||
| Accrued interest payable | 683 | 531 | 261 | |||||||||
| Other liabilities | 6,081 | 6,188 | 12,049 | |||||||||
| Total liabilities | 967,205 | 962,961 | 942,765 | |||||||||
| Stockholders’ Equity | ||||||||||||
| Common stock and surplus | 33,145 | 33,356 | 33,520 | |||||||||
| Retained earnings | 69,638 | 68,866 | 63,067 | |||||||||
| Accumulated other comprehensive loss | (19,908 | ) | (19,340 | ) | (20,278 | ) | ||||||
| Total stockholders’ equity | 82,875 | 82,882 | 76,309 | |||||||||
| Total liabilities and stockholders’ equity | $ | 1,050,080 | $ | 1,045,843 | $ | 1,019,074 | ||||||
| Book value per share | $ | 14.72 | $ | 14.84 | $ | 13.61 | ||||||
| Tangible book value per share | $ | 14.00 | $ | 14.09 | $ | 12.82 | ||||||
| Asset Quality Indicators | ||||||||||||
| Nonperforming assets to total assets | 0.17 | % | 0.17 | % | 0.16 | % | ||||||
| Nonperforming loans to total loans | 0.22 | % | 0.21 | % | 0.22 | % | ||||||
| Allowance for credit losses to total loans | 0.82 | % | 0.82 | % | 0.89 | % | ||||||
| Allowance for credit losses to nonperforming loans | 378.14 | % | 389.31 | % | 407.59 | % | ||||||
Skyline Bankshares, Inc.
Condensed Consolidated Statement of Operations
| Three Months Ended | ||||||||
| March 31, | ||||||||
| (dollars in thousands except share amounts) | 2024 | 2023 | ||||||
| (Unaudited) | (Unaudited) | |||||||
| Interest income | ||||||||
| Loans and fees on loans | $ | 11,147 | $ | 9,164 | ||||
| Interest-bearing deposits in banks | 64 | 88 | ||||||
| Federal funds sold | 4 | 10 | ||||||
| Interest on securities | 734 | 796 | ||||||
| Dividends | 37 | 10 | ||||||
| 11,986 | 10,068 | |||||||
| Interest expense | ||||||||
| Deposits | 2,682 | 894 | ||||||
| Interest on borrowings | 437 | 169 | ||||||
| 3,119 | 1,063 | |||||||
| Net interest income | 8,867 | 9,005 | ||||||
| Provision for (Recovery of) credit losses | 93 | (106 | ) | |||||
| Net interest income after provision for (recovery of) credit losses | 8,774 | 9,111 | ||||||
| Noninterest income | ||||||||
| Service charges on deposit accounts | 551 | 497 | ||||||
| Other service charges and fees | 849 | 823 | ||||||
| Net realized losses on securities | (141 | ) | - | |||||
| Mortgage origination fees | 55 | 84 | ||||||
| Increase in cash value of life insurance | 146 | 139 | ||||||
| Life insurance income | 218 | - | ||||||
| Other income | 21 | 21 | ||||||
| 1,699 | 1,564 | |||||||
| Noninterest expenses | ||||||||
| Salaries and employee benefits | 4,321 | 4,086 | ||||||
| Occupancy and equipment | 1,411 | 1,186 | ||||||
| Data processing expense | 649 | 491 | ||||||
| FDIC Assessments | 144 | 111 | ||||||
| Advertising | 217 | 135 | ||||||
| Bank franchise tax | 99 | 105 | ||||||
| Director fees | 58 | 61 | ||||||
| Professional fees | 221 | 221 | ||||||
| Telephone expense | 107 | 139 | ||||||
| Core deposit intangible amortization | 80 | 105 | ||||||
| Other expense | 669 | 695 | ||||||
| 7,976 | 7,335 | |||||||
| Net income before income taxes | 2,497 | 3,340 | ||||||
| Income tax expense | 446 | 612 | ||||||
| Net income | $ | 2,051 | $ | 2,728 | ||||
| Net income per share | $ | 0.37 | $ | 0.49 | ||||
| Weighted average shares outstanding | 5,564,568 | 5,597,233 | ||||||
| Dividends declared per share | $ | 0.23 | $ | 0.21 | ||||
Skyline Bankshares, Inc.
Reconciliation of Non-GAAP Financial Measures
| In addition to financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses certain non-GAAP financial measures that provide useful information for financial and operational decision making, evaluating trends, and understanding the Company’s financial condition, capital position and financial results. Non-GAAP financial measures are supplemental and not a substitute for, or more important than, financial measures prepared in accordance with GAAP and may not be comparable to those reported by other financial institutions. The non-GAAP financial measure presented in this document includes tangible book value per share. The following tables present calculations underlying non-GAAP financial measures. | ||||||||||||
| March 31, | December 31, | March 31, | ||||||||||
| (dollars in thousands except share amounts) | 2024 | 2023 | 2023 | |||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| Tangible Common Equity | ||||||||||||
| Total stockholders’ equity (GAAP) | $ | 82,875 | $ | 82,882 | $ | 76,309 | ||||||
| Less: Goodwill | (3,257 | ) | (3,257 | ) | (3,257 | ) | ||||||
| Less: Core deposit intangible | (837 | ) | (917 | ) | (1,181 | ) | ||||||
| Tangible common equity (non-GAAP) | $ | 78,781 | $ | 78,708 | $ | 71,871 | ||||||
| Common stock shares outstanding | 5,629,204 | 5,584,204 | 5,607,416 | |||||||||
| Tangible book value per share | $ | 14.00 | $ | 14.09 | $ | 12.82 | ||||||
For more information contact:
Blake Edwards, President & CEO – 276-773-2811
Lori Vaught, EVP & CFO – 276-773-2811
FAQ
What was Skyline Bankshares, Inc.'s net income for the first quarter of 2024?
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What was the annualized return on average assets (ROAA) for Skyline Bankshares, Inc. in the first quarter of 2024?
What strategic move did Skyline Bankshares, Inc. announce in the first quarter of 2024?
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