Third Century Bancorp Releases Earnings for the Quarter Ended June 30, 2024

Rhea-AI Summary

Third Century Bancorp (OTCPINK: TDCB) reported unaudited net income of $228,000 for Q2 2024, or $0.19 per share, up from $175,000 ($0.15 per share) in Q2 2023. Key factors include:

1. Increased residential mortgage loan activity
2. Improved loan portfolio yield
3. Efficient non-interest expense management

For H1 2024, net income rose to $558,000, a 12.88% increase from $494,000 in H1 2023. Total assets grew to $316.5 million as of June 30, 2024. Loans held for investment increased by 1.14% to $199.0 million, while total deposits decreased to $242.5 million. Stockholders' equity stood at $9.43 million, up from $8.58 million a year ago but down from $9.51 million at the end of 2023.

Positive

• Net income increased by 30.07% to $228,000 in Q2 2024 compared to Q2 2023
• Total interest income rose by 13.85% to $3,848,000 for Q2 2024
• Non-interest income increased by 5.76% to $333,000 in Q2 2024
• Non-interest expense decreased by 1.82% to $2,031,000 in Q2 2024
• Total assets increased to $316.5 million as of June 30, 2024
• Loans held for investment grew by 1.14% to $199.0 million
• Stockholders' equity improved to $9.43 million from $8.58 million a year ago

Negative

• Net interest income decreased to $1.9 million for Q2 2024
• Total interest expense increased by 44.14% to $1,968,000 in Q2 2024
• Total deposits decreased to $242.5 million from $246.1 million at the end of 2023
• Stockholders' equity declined from $9.51 million at the end of 2023 to $9.43 million
• Average equity as a percentage of assets decreased to 2.64% from 2.74% at the end of 2023

FRANKLIN, Ind.--(BUSINESS WIRE)-- (OTCPINK: TDCB) - Third Century Bancorp (“Company”), the holding company for Mutual Savings Bank (“Bank”), announced it recorded unaudited net income of $228,000 for the quarter ended June 30, 2024, or $0.19 per basic and diluted share, compared to net income of $175,000 for the quarter ended June 30, 2023, or $0.15 per basic and diluted share.

“We were pleased to see our second quarter June 30, 2024 earnings level improve over the same period from a year earlier”, noted David A. Coffey, President and CEO. Coffey continued, “Several factors contributed to this improvement. Of particular importance is the return of residential mortgage loan activity, which helps generate loan sale fee income. In addition, our loan portfolio yield continues to improve due to new loans being booked at current higher interest rates and adjustable-rate loans are adjusting at higher rates. Finally, we continue to see the impact of being mindful of our non-interest expense as we make every effort to operate efficiently.” Coffey concluded, “The key to a successful year will be to continue to focus on improving our net interest margin.”

For the quarter ended June 30, 2024, net income increased $53,000, or 30.07%, to $228,000 as compared to $175,000 for the same period in the prior year. Net interest income decreased to $1.9 million for the three months ended June 30,2024 due to an increase in total interest expense of $603,000, or 44.14%, to $1,968,000 for the three-month period ended June 30, 2024, as compared to $1,365,000 for the same period for the prior year. The increase in total interest expense was due to the increase in funding costs of both retail deposits and wholesale funding. Offsetting the increase in total interest expense was an increase in total interest income of $468,000, or 13.85% to $3,848,000 for the three-month period ended June 30, 2024, compared to $3,380,000 for the same period for the prior year. The increase in total interest income was the result of higher average yields on interest earning assets and higher average loan balances. The provision for credit losses during the current quarter was $0, compared to $146,000 for the same quarter last year due to the ongoing strength of our credit quality and zero non-performing loans for the last several quarters. Non-interest income increased by $18,000, or 5.76%, to $333,000 for the quarter ended June 30, 2024, as compared to $315,000 for the same period in the prior year. The increase in non-interest income occurred due to a slightly higher volume of residential loan sales compared to the same period for the prior year. Non-interest expense decreased by $38,000, or 1.82%, to $2,031,000 for the quarter ended June 30, 2024, as compared to $2,069,000 for the same period in the prior year due to cost savings in personnel and advertising expenses.

For the six-months ended June 30, 2024, net income increased $64,000, or 12.88%, to $558,000 as compared to $494,000 for the same period in the prior year. Net interest income decreased to $3.8 million for the six-months ended June 30,2024 due to an increase in total interest expense of $1,442,000, or 60.22%, to $3,836,000 for the six-month period ended June 30, 2024, as compared to $2,394,000 for the same period for the prior year. The increase in total interest expense was due to the increase in funding costs of both retail deposits and wholesale funding. Offsetting the increase in total interest expense was an increase in total interest income of $1,235,000, or 19.17% to $7,679,000 for the six-month period ended June 30, 2024, compared to $6,444,000 for the same period for the prior year. The increase in total interest income was the result of higher average yields on interest earning assets and higher average loan balances. The provision for credit losses during the first half of 2024 was $2,000 compared to $176,000 for the same period last year due to the ongoing strength of our credit quality and zero non-performing loans for the last several quarters. Non-interest expense decreased by $70,000, or 1.71%, to $3,996,000 for the six-months ended June 30, 2024, as compared to $4,066,000 for the same period in the prior year due to cost savings in personnel, outside consultant fees, and advertising expenses. Non-interest income increased by $57,000, or 9.41%, to $664,000 for the six-months ended June 30, 2024, as compared to $607,000 for the same period in the prior year. The increase in non-interest income occurred due to a higher volume of residential loan sales, increased service fee income, and income on other assets as compared to the same period for the prior year. Non-interest income for the current six-months was also offset by a total of $42,000 in security sale losses due to balance sheet restructuring.

Total assets rose to $316.5 million at June 30, 2024 compared to $312.9 million at December 31, 2023. This increase was primarily due to a $4.7 million, or 34.93%, increase in cash and due from banks to $18.2 million at June 30, 2024. Loans held for investment increased to $199.0 million as of June 30, 2024, which is an increase of 1.14% compared to $196.7 million at December 31,2023. Total investments decreased $4.1 million, or 4.92% to $79.2 million at June 30, 2024 compared to $83.3 million at December 31, 2023. Total deposits were $242.5 million at June 30, 2024, down from $246.1 million as of December 31, 2023. As of June 30, 2023, the weighted average rate of all FHLB advances was 3.93% compared to 3.72% at December 31, 2023, and total FHLB advance balances were down $3.0 million, or 6.45% to $43.5 million at June 30, 2024 compared to $46.5 million at December 31, 2023.

Stockholders’ equity was $9.43 million at June 30, 2024, up from $8.58 million at June 30, 2023 and down from $9.51 million at December 31, 2023. Stockholders’ equity decreased during the six-months ended June 30, 2024, largely due to dividend payouts but increased over the twelve-month period since June 30, 2023 due to continued earnings and lower net unrealized losses in the available-for-sale-securities portfolio. The available-for-sale securities are investments in government sponsored mortgage-backed securities as well as investments in municipal bonds, which provide cash flow for business purposes. Average equity as a percentage of assets was 2.64% at June 30, 2024 compared to 2.74% at December 31, 2023.

Founded in 1890, Mutual Savings Bank is a full-service financial institution based in Johnson County, Indiana. In addition to its main office at 80 East Jefferson Street, Franklin, Indiana, the Bank operates branches in Franklin at 1124 North Main Street, Trafalgar and Greenwood, Indiana.

This press release contains certain forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Certain factors that could cause actual results to differ materially from expected results include inflation, changes in the interest rate environment, changes in general economic conditions, geopolitical conflicts, public health issues, legislative and regulatory changes that adversely affect the business of the Company and the Bank, and changes in the securities markets. Except as required by law, the Company does not undertake any obligation to update any forward-looking statements to reflect changes in belief, expectations, or events.

Condensed Consolidated Statements of Income
(Unaudited)
In thousands, except per share data
		Three Months Ended												Six Months Ended
		June 30,				March 31,				June 30,				June 30,				June 30,
		2024				2024				2023				2024				2023
Selected Consolidated Earnings Data:
Total Interest Income		$	3,848			$	3,831			$	3,380			$	7,679			$	6,444
Total Interest Expense			1,968				1,868				1,365				3,836				2,394
Net Interest Income			1,881				1,963				2,015				3,844				4,050
Provision for Losses on Loans			-				2				146				2				176
Net Interest Income after Provision for Losses on Loans			1,881				1,961				1,869				3,842				3,874
Non-Interest Income			333				331				315				664				607
Non-Interest Expense			2,031				1,965				2,069				3,996				4,066
Income Tax Expense			(45	)			(3	)			(60	)			(48	)			(79	)
Net Income		$	228			$	330			$	175			$	558			$	494
Earnings Per Share - basic		$	0.19			$	0.28			$	0.15			$	0.47			$	0.42
Earnings Per Share - diluted		$	0.19			$	0.28			$	0.15			$	0.47			$	0.42
Condensed Consolidated Balance Sheet
(Unaudited)
In thousands, except per share data
		June 30,				December 31,				June 30,
		2024				2023				2023
Selected Consolidated Balance Sheet Data:
Assets
Cash and Due from Banks		$	18,174			$	13,470			$	16,019
Investment Securities, Available-for-Sale, at Fair Value			76,270				80,367				80,848
Investment Securities, Held-to-Maturity			2,950				2,950				2,950
Loans Held-for-Sale			690				552				-
Loans Held-for-Investment			198,961				196,722				188,319
Allowance for Credit Losses			2,976				2,972				2,904
Net Loans			195,985				194,302				185,415
Accrued Interest Receivable			1,528				1,547				1,347
Other Assets			20,874				20,269				19,619
Total Assets		$	316,471			$	312,905			$	306,198
Liabilities
Noninterest-Bearing Deposits		$	39,895			$	43,692			$	43,167
Interest-Bearing Deposits			202,624				202,426				194,502
Total Deposits			242,520				246,118				237,669
FHLB Advances and Other Borrowings			53,500				46,500				49,500
Subordinated Notes, Net of Issuances Costs			9,771				9,758				9,744
Accrued Interest Payable			773				485				445
Accrued Expenses and Other Liabilities			478				536				261
Total Liabilities			307,042				303,397				297,619
Stockholders' Equity
Common Stock			11,505				11,480				11,573
Retained Earnings			10,838				10,338				10,008
Accumulated Other Comprehensive Loss			(12,915	)			(12,310	)			(13,002	)
Total Stockholders' Equity			9,428				9,508				8,579
Total Liabilities and Stockholders' Equity		$	316,471			$	312,905			$	306,198
		Three Months Ended												Six Months Ended
		dollar figures are in thousands, except per share data
		June 30,				March 31,				June 30,				June 30,				June 30,
		2024				2024				2023				2024				2023
Selected Financial Ratios and Other Data (Unaudited):
Interest Rate Spread During Period			2.09	%			2.14	%			2.46	%			2.12	%			2.50	%
Net Yield on Interest-Earning Assets			5.19	%			5.04	%			4.72	%			5.12	%			4.55	%
Non-Interest Expense, Annualized, to Average Assets			2.60	%			2.49	%			2.81	%			2.53	%			2.84	%
Return on Average Assets, Annualized			0.29	%			0.42	%			0.24	%			0.35	%			0.34	%
Return on Average Equity, Annualized			11.03	%			16.01	%			8.49	%			12.78	%			11.17	%
Average Equity to Assets			2.64	%			2.61	%			2.80	%			2.76	%			3.08	%
Average Net Loans		$	195,685			$	194,173			$	186,542			$	194,776			$	182,593
Average Net Securities			78,971				82,413				84,335				80,692				86,855
Average Other Interest-Earning Assets			22,009				27,430				15,743				24,719				13,872
Total Average Interest-Earning Assets			296,665				304,015				286,620				300,188				283,320
Average Total Assets			312,570				316,113				294,192				315,998				286,660
Average Noninterest-Bearing Deposits		$	40,568			$	42,188			$	43,472			$	41,371			$	43,457
Average Interest-Bearing Deposits			205,295				206,220				191,787				205,758				195,237
Average Total Deposits			245,863				248,408				235,259				247,128				238,694
Average Wholesale Funding			48,764				51,104				49,693				49,934				38,755
Average Interest-Bearing Liabilities			254,059				257,325				241,480				255,692				233,992
Avg. Interest-Earnings Assets to Avg. Interest-Bearings Liabilities			116.77	%			118.14	%			118.69	%			117.40	%			121.08	%
Average equity		$	8,253.62			$	8,245.26			$	8,219.00			$	8,725.74			$	8,842.00
Non-Performing Loans to Total Loans			0.00	%			0.00	%			0.00	%			0.00	%			0.00	%
Allowance for Credit Losses to Total Loans Outstanding			1.49	%			1.51	%			1.54	%			1.49	%			1.54	%
Allowance for Credit Losses to Non-Performing Loans			-				-				-				-				-
Net Loan Chargeoffs/(Recoveries) to Avg. Total Loans Outstanding			0.00	%			0.00	%			0.00	%			0.00	%			0.00	%
Effective Income Tax Rate			-24.85	%			-0.92	%			-52.17	%			-24.85	%			-19.04	%
Tangible Book Value Per Share		$	8.02			$	7.75			$	7.21			$	8.02			$	7.21
Market Closing Price at the End of Quarter		$	6.94			$	6.98			$	7.55			$	6.94			$	7.55
Price-to-Tangible Book Value			86.59	%			90.02	%			104.68	%			86.59	%			104.68	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240731161400/en/

David A. Coffey, President and CEO

S. Paul Arab, SVP and CFO

Tel. 317-736-7151

Source: Third Century Bancorp

FAQ

What was Third Century Bancorp's (TDCB) net income for Q2 2024?

Third Century Bancorp (TDCB) reported unaudited net income of $228,000 for the quarter ended June 30, 2024.

How did TDCB's Q2 2024 earnings compare to Q2 2023?

TDCB's Q2 2024 net income of $228,000 ($0.19 per share) increased by 30.07% compared to $175,000 ($0.15 per share) in Q2 2023.

What factors contributed to TDCB's improved earnings in Q2 2024?

Key factors included increased residential mortgage loan activity, improved loan portfolio yield, and efficient non-interest expense management.

How did TDCB's total assets change as of June 30, 2024?

TDCB's total assets rose to $316.5 million as of June 30, 2024, compared to $312.9 million at December 31, 2023.

What was TDCB's stockholders' equity as of June 30, 2024?

TDCB's stockholders' equity was $9.43 million as of June 30, 2024, up from $8.58 million a year ago but down from $9.51 million at the end of 2023.