Calvin B. Taylor Bankshares, Inc. Reports Third Quarter 2023 Financial Results
- 23.8% increase in net income for the nine months ended September 30, 2023
- 11.5% increase in quarterly net income to $4.1 million for the third quarter of 2023
- Organic loan growth with loans growing $42.2 million, or 8.2%, since December 31, 2022
- On-balance sheet liquidity remained strong at 30.7% of total deposits as of September 30, 2023
- Deposits decreased by $11.5 million or 1.4% since December 31, 2022
- Deposits decreased by $42.0 million or 5.0% in the previous 12 months
BERLIN, MD / ACCESSWIRE / December 7, 2023 / Calvin B. Taylor Bankshares, Inc. (the "Company") (OTCQX:TYCB), the holding company of Calvin B. Taylor Bank (the "Bank"), today reported unaudited financial results for the third quarter ended September 30, 2023. Highlights of the Company's financial results are noted below.
- Net income for the nine months ended September 30, 2023 was
$10.7 million which is a23.8% increase compared to the same period in 2022. - Quarterly net income increased
11.5% to$4.1 million for the third quarter of 2023 as compared to the third quarter of 2022 and increased25.8% compared to the previous quarter. - Return on Average Assets increased to
1.81% for the third quarter of 2023 and1.60% for the nine months ended September 30, 2023. - Return on Average Equity increased to
16.52% for the third quarter of 2023 and14.51% for the nine months ended September 30, 2023. - Net interest margin increased to
3.64% in the third quarter of 2023, as compared to3.14% in the third quarter of 2022 and3.55% in the previous quarter. - Organic loan growth continued in 2023 with loans growing
$42.2 million , or8.2% , since December 31, 2022. Loans have increased$66.6 million , or13.6% , in the twelve months ended September 30, 2023. - Deposits decreased by
$11.5 million or1.4% since December 31, 2022 as a result of higher interest rates currently offered by short term government bond investments. Seasonal deposit inflows during the third quarter of 2023 related to the summer tourism season partially offset the deposit outflows seeking higher interest rates. The Company did not experience any significant outflow of uninsured deposits during the nine months ended September 30, 2023. - Following several years of significant growth, deposits decreased by
$42.0 million or5.0% in the previous 12 months which resulted in total assets decreasing by$33.0 million , or3.5% since September 30, 2022. - On-balance sheet liquidity, as measured by cash and unencumbered available for sale debt securities, remains strong as of September 30, 2023 and equaled
30.7% of total deposits. - Noncore funding sources including Federal Home Loan Bank borrowings, brokered deposits, and the recently created Federal Reserve Bank Term Funding Program were not utilized in the nine months ended September 30, 2023.
President and Chief Executive Officer Raymond M. Thompson commented, "Strong earnings performance continued through the third quarter of 2023. Net income thru the first nine months of 2023 was
Quarterly Results of Operations
Quarterly net income was
For the Quarters Ended | % Change | |||||||||||||||||||
Results of Operations | Sept 30, 2023 | Sept 30, 2022 | Jun 30, 2023 | Prior Year | Prior Quarter | |||||||||||||||
Net interest income | $ | 8,009,970 | $ | 7,158,425 | $ | 7,415,953 | 11.9 | % | 8.0 | % | ||||||||||
Provision for credit losses | $ | (80,000 | ) | $ | 50,000 | $ | 240,000 | -260.0 | % | -133.3 | % | |||||||||
Noninterest income | $ | 1,063,019 | $ | 1,190,606 | $ | 936,651 | -10.7 | % | 13.5 | % | ||||||||||
Noninterest expense | $ | 3,863,655 | $ | 3,403,017 | $ | 3,895,207 | 13.5 | % | -0.8 | % | ||||||||||
Net income | $ | 4,133,334 | $ | 3,708,014 | $ | 3,285,897 | 11.5 | % | 25.8 | % | ||||||||||
Yield on earning assets | 4.34 | % | 3.31 | % | 4.20 | % | 31.1 | % | 3.3 | % | ||||||||||
Cost of interest-bearing deposits | 1.15 | % | 0.29 | % | 1.05 | % | 296.6 | % | 9.5 | % | ||||||||||
Net interest margin | 3.64 | % | 3.14 | % | 3.55 | % | 15.9 | % | 2.5 | % | ||||||||||
Return on average assets (annualized) | 1.81 | % | 1.56 | % | 1.50 | % | 16.0 | % | 20.7 | % | ||||||||||
Return on average equity (annualized) | 16.52 | % | 15.52 | % | 13.24 | % | 6.4 | % | 24.8 | % | ||||||||||
Efficiency ratio | 42.19 | % | 40.76 | % | 46.32 | % | 3.5 | % | -8.9 | % |
Net interest income increased
On January 1, 2023 the Company adopted the current expected credit losses ("CECL") model pursuant to ASU 2016-13. The estimate of expected credit losses considers historical information, current information, and supportable forecasts, including estimates of prepayments. The negative provision for credit losses of
Noninterest income decreased in 3Q23 by
Current quarter noninterest expense increased by
Quarterly per share data and repurchases of stock by the Company for each period is included in the following table. The stock repurchase plan previously adopted by the Board of Directors remains in place and as of September 30, 2023 has 53,628 shares available to be repurchased. The amount and timing of future stock repurchases will depend upon several factors including regulatory capital requirements, market value of the Company's stock, general market and economic conditions, liquidity, and other relevant considerations, as determined by the Company.
At or for the Quarters Ended | % Change | |||||||||||||||
Per Share Data | Sept 30, 2023 | Sept 30, 2022 | Jun 30, 2023 | Prior Year | Prior Quarter | |||||||||||
Net income | $ | 1.50 | $ | 1.34 | $ | 1.19 | 11.7 | % | 26.0 | % | ||||||
Dividends | $ | 0.34 | $ | 0.33 | $ | 0.34 | 3.0 | % | 0.0 | % | ||||||
Dividend payout ratio | 22.65 | % | 24.55 | % | 28.50 | % | -7.7 | % | -20.5 | % | ||||||
Book value | $ | 35.98 | $ | 32.92 | $ | 35.98 | 9.3 | % | 0.0 | % | ||||||
Book value excluding OCI | $ | 41.83 | $ | 38.38 | $ | 40.67 | 9.0 | % | 2.9 | % | ||||||
Market value | $ | 42.25 | $ | 38.00 | $ | 42.00 | 11.2 | % | 0.6 | % | ||||||
Number of shares repurchased | - | - | 4,954 | |||||||||||||
Repurchase amount | $ | - | $ | - | $ | 198,023 | ||||||||||
Average repurchase price | $ | - | $ | - | $ | 39.97 |
Year to Date Results of Operations
Net income was
For the Nine Months Ended | % Change | |||||||||||
Results of Operations | Sept 30, 2023 | Sept 30, 2022 | Prior Year | |||||||||
Net interest income | $ | 22,842,198 | $ | 18,645,577 | 22.5 | % | ||||||
Provision for credit losses | $ | 340,000 | $ | 275,000 | 23.6 | % | ||||||
Noninterest income | $ | 2,950,670 | $ | 3,125,551 | -5.6 | % | ||||||
Noninterest expense | $ | 11,569,301 | $ | 10,051,589 | 15.1 | % | ||||||
Net income | $ | 10,747,567 | $ | 8,680,039 | 23.8 | % | ||||||
Yield on earning assets | 4.20 | % | 2.96 | % | 42.1 | % | ||||||
Cost of interest-bearing deposits | 1.03 | % | 0.21 | % | 388.9 | % | ||||||
Net interest margin | 3.57 | % | 2.82 | % | 26.5 | % | ||||||
Return on average assets (annualized) | 1.60 | % | 1.25 | % | 28.3 | % | ||||||
Return on average equity (annualized) | 14.51 | % | 12.04 | % | 20.5 | % | ||||||
Efficiency ratio | 44.61 | % | 46.17 | % | -3.4 | % |
Net interest income increased
On January 1, 2023 the Company adopted the CECL model pursuant to ASU 2016-13. The estimate of expected credit losses considers historical information, current information, and supportable forecasts, including estimates of prepayments. The provision for credit losses of
Noninterest income for the nine months ended September 30, 2023 decreased by
Noninterest expense for the nine months ended September 30, 2023 increased by
Per share data and repurchases of stock by the Company for each period is included in the following table.
At or for the Nine Months Ended | % Change | ||||||||||||
Per Share Data | Sept 30, 2023 | Sept 30, 2022 | Prior Year | ||||||||||
Net income | $ | 3.90 | $ | 3.14 | 24.0 | % | |||||||
Dividends | $ | 1.01 | $ | 0.93 | 8.6 | % | |||||||
Dividend payout ratio | 25.89 | % | 29.57 | % | -12.4 | % | |||||||
Book value | $ | 35.98 | $ | 32.92 | 9.3 | % | |||||||
Book value excluding OCI | $ | 41.83 | $ | 38.38 | 9.0 | % | |||||||
Market value | $ | 42.25 | $ | 38.00 | 11.2 | % | |||||||
Number of shares repurchased | 4,954 | 1,400 | 253.9 | % | |||||||||
Repurchase amount | $ | 198,023 | $ | 50,637 | 291.1 | % | |||||||
Average repurchase price | $ | 39.97 | $ | 36.17 | 10.5 | % |
Financial Condition
Disruption in the banking industry earlier this year has highlighted the importance of deposit insurance, core deposits, liquidity and capital. The Company relies mostly on core deposits, as defined by bank regulators, which are gathered from customers in local markets. The Company and the Bank remain well-capitalized according to regulatory capital standards and exceed the threshold to be considered well-capitalized (Community Bank Leverage Ratio) by more than
At or for the Quarters Ended | % Change | |||||||||||||||||
Financial Condition | Sept 30, 2023 | Sept 30, 2022 | Jun 30, 2023 | Prior Year | Prior Quarter | |||||||||||||
Assets | $ | 899,714,244 | $ | 932,633,236 | $ | 886,325,009 | -3.5 | % | 1.5 | % | ||||||||
Cash + unencumbered debt securities | $ | 244,545,021 | $ | 347,123,364 | $ | 227,516,889 | -29.6 | % | 7.5 | % | ||||||||
Loans | $ | 555,192,827 | $ | 488,548,319 | $ | 560,033,006 | 13.6 | % | -0.9 | % | ||||||||
Deposits | $ | 797,524,704 | $ | 839,553,890 | $ | 784,337,394 | -5.0 | % | 1.7 | % | ||||||||
Interest-bearing deposits | $ | 523,634,274 | $ | 533,479,784 | $ | 523,380,027 | -1.8 | % | 0.0 | % | ||||||||
Stockholders' equity | $ | 99,105,109 | $ | 90,828,716 | $ | 99,083,210 | 9.1 | % | 0.0 | % | ||||||||
Common stock - shares outstanding | 2,754,086 | 2,759,360 | 2,754,086 | -0.2 | % | 0.0 | % | |||||||||||
Stockholders' equity / assets | 11.02 | % | 9.74 | % | 11.18 | % | 13.1 | % | -1.4 | % | ||||||||
Average assets | $ | 914,671,398 | $ | 947,954,951 | $ | 877,431,152 | -3.5 | % | 4.2 | % | ||||||||
Average loans | $ | 557,482,431 | $ | 490,127,223 | $ | 560,255,486 | 13.7 | % | -0.5 | % | ||||||||
Average deposits | $ | 808,860,861 | $ | 847,367,488 | $ | 773,425,984 | -4.5 | % | 4.6 | % | ||||||||
Average stockholders' equity | $ | 100,064,043 | $ | 95,536,708 | $ | 99,251,206 | 4.7 | % | 0.8 | % | ||||||||
Average stockholders' equity / average assets | 10.94 | % | 10.08 | % | 11.31 | % | 8.6 | % | -3.3 | % | ||||||||
Tier 1 capital to average assets (leverage ratio) | 12.42 | % | 11.06 | % | 12.59 | % | 12.3 | % | -1.3 | % |
Following several years of significant growth, deposits decreased by
On-balance sheet liquidity, as measured by cash and unencumbered available for sale debt securities, remains strong as of September 30, 2023 and equaled
At or for the Quarters Ended | % Change | |||||||||||||||||||
Liquidity | Sept 30, 2023 | Sept 30, 2022 | Jun 30, 2023 | Prior Year | Prior Quarter | |||||||||||||||
Cash + unencumbered debt securities / deposits | 30.66 | % | 41.35 | % | 29.01 | % | -25.8 | % | 5.7 | % | ||||||||||
Debt securities pledged / total debt securities | 11.59 | % | 12.30 | % | 11.57 | % | -5.8 | % | 0.2 | % | ||||||||||
Loans / deposits | 69.61 | % | 58.19 | % | 71.40 | % | 19.6 | % | -2.5 | % | ||||||||||
Average loans / average deposits | 68.92 | % | 57.84 | % | 72.44 | % | 19.2 | % | -4.9 | % | ||||||||||
Core deposits / total assets | 88.45 | % | 89.72 | % | 88.27 | % | -1.4 | % | 0.2 | % | ||||||||||
Deposits > | 29.63 | % | 38.20 | % | 28.29 | % | -22.4 | % | 4.7 | % |
Noncore funding sources are available to the Bank but are intended for contingency funding needs and not to pursue growth. As of September 30, 2023, the Bank has the ability to borrow up to
Loans and Asset Quality
Increasing interest rates, economic uncertainty and other factors have impacted current loan demand as compared to demand experienced in the previous 12 months. Conversely, funding of previously committed construction loans, localized demand for commercial and residential real estate loans, and seasonal borrowings during the first nine months of 2023 resulted in continued organic loan growth with loans increasing
Loan performance has remained strong over the past 12 months as local economic conditions have remained stable. Inflation and higher interest rates have not resulted in a deterioration of credit quality as of September 30, 2023. Past due loans have increased to
At or for the Quarters Ended | % Change | |||||||||||||||||||
Asset Quality | Sept 30, 2023 | Sept 30, 2022 | Jun 30, 2023 | Prior Year | Prior Quarter | |||||||||||||||
Allowance for credit losses / total loans | 0.63 | % | 0.45 | % | 0.62 | % | 38.9 | % | 1.7 | % | ||||||||||
Net charge-offs (recoveries) / average loans | -0.01 | % | 0.01 | % | 0.00 | % | -247.0 | % | -465.6 | % | ||||||||||
Loans past due 30 days or more / total loans | 0.49 | % | 0.25 | % | 0.36 | % | 95.9 | % | 35.1 | % | ||||||||||
Non-accrual loans / total loans | 0.04 | % | 0.04 | % | 0.02 | % | -1.9 | % | 168.5 | % |
Financial Statements
Consolidated balance sheets at period end and consolidated statements of income for the periods ended are presented below.
Consolidated Balance Sheets | ||||||||||||
(unaudited) | (unaudited) | |||||||||||
Sept 30, 2023 | Dec 31, 2022 | Sept 30, 2022 | ||||||||||
Assets | ||||||||||||
Cash and cash equivalents | ||||||||||||
Cash and due from banks | $ | 10,541,773 | $ | 9,060,252 | $ | 10,274,435 | ||||||
Federal funds sold and interest bearing deposits | 87,769,625 | 133,316,028 | 186,358,548 | |||||||||
Total cash and cash equivalents | 98,311,398 | 142,376,280 | 196,632,983 | |||||||||
Time deposits in other financial institutions | - | 1,225,953 | 1,726,929 | |||||||||
Debt securities available for sale, at fair value | 161,582,511 | 167,934,059 | 168,803,379 | |||||||||
Debt securities held to maturity, at amortized cost | 42,306,978 | 39,110,156 | 35,410,939 | |||||||||
Equity securities, at cost | 748,833 | 748,833 | 748,833 | |||||||||
Restricted stock, at cost | 651,500 | 469,500 | 467,000 | |||||||||
Loans | 555,192,827 | 513,025,696 | 488,548,319 | |||||||||
Less: allowance for credit losses | (3,482,333 | ) | (2,624,369 | ) | (2,205,383 | ) | ||||||
Net loans | 551,710,494 | 510,401,327 | 486,342,936 | |||||||||
Accrued interest receivable | 2,181,704 | 2,036,468 | 1,660,109 | |||||||||
Debt securities sold receivable | - | 1,789,635 | - | |||||||||
Prepaid expenses | 604,998 | 730,891 | 436,997 | |||||||||
Other real estate owned | 294,467 | - | - | |||||||||
Premises and equipment, net | 12,882,400 | 12,751,025 | 12,848,920 | |||||||||
Computer software, net | 175,755 | 238,009 | 276,546 | |||||||||
Deferred income taxes, net | 5,219,164 | 4,467,476 | 5,013,425 | |||||||||
Bank owned life insurance and annuities | 21,849,420 | 21,398,096 | 21,244,217 | |||||||||
Other assets | 1,194,622 | 262,435 | 1,020,023 | |||||||||
Total assets | $ | 899,714,244 | $ | 905,940,143 | $ | 932,633,236 | ||||||
Liabilities and Stockholders' Equity | ||||||||||||
Deposits | ||||||||||||
Noninterest-bearing | $ | 273,890,430 | $ | 265,805,939 | $ | 306,074,106 | ||||||
Interest-bearing | 523,634,274 | 543,202,520 | 533,479,784 | |||||||||
Total deposits | 797,524,704 | 809,008,459 | 839,553,890 | |||||||||
Accrued interest payable | 238,651 | 75,438 | 48,040 | |||||||||
Dividends payable | 936,389 | 910,483 | 910,589 | |||||||||
Accrued expenses | 226,962 | 703,052 | 244,502 | |||||||||
Non-qualified deferred compensation | 881,667 | 654,674 | 614,217 | |||||||||
Other liabilities | 800,762 | 363,790 | 433,282 | |||||||||
Total liabilities | 800,609,135 | 811,715,896 | 841,804,520 | |||||||||
Stockholders' equity | ||||||||||||
Common stock, par value | ||||||||||||
authorized 10,000,000 shares; issued and outstanding | 2,754,086 | 2,759,040 | 2,759,360 | |||||||||
Additional paid-in capital | 2,144,387 | 2,337,456 | 2,349,297 | |||||||||
Retained earnings | 110,314,830 | 102,963,224 | 100,784,401 | |||||||||
Accumulated other comprehensive loss, net of tax | (16,108,194 | ) | (13,835,473 | ) | (15,064,342 | ) | ||||||
Total stockholders' equity | 99,105,109 | 94,224,247 | 90,828,716 | |||||||||
Total liabilities and stockholders' equity | $ | 899,714,244 | $ | 905,940,143 | $ | 932,633,236 |
Consolidated Statements of Income (unaudited) | ||||||||||||||||
For the three months ended | For the nine months ended | |||||||||||||||
Sept 30, 2023 | Sept 30, 2022 | Sept 30, 2023 | Sept 30, 2022 | |||||||||||||
Interest income | ||||||||||||||||
Loans, including fees | $ | 6,919,231 | $ | 5,489,970 | $ | 19,875,632 | $ | 15,625,474 | ||||||||
U. S. Treasury and government agency debt securities | 502,696 | 290,946 | 1,457,449 | 644,400 | ||||||||||||
Mortgage-backed debt securities | 671,450 | 487,148 | 1,974,153 | 1,190,519 | ||||||||||||
State and municipal debt securities | 108,174 | 119,376 | 325,978 | 307,399 | ||||||||||||
Federal funds sold and interest-bearing deposits | 1,345,316 | 1,161,494 | 3,273,911 | 1,694,985 | ||||||||||||
Time deposits in other financial institutions | - | 7,561 | 2,701 | 28,657 | ||||||||||||
Total interest income | 9,546,867 | 7,556,495 | 26,909,824 | 19,491,434 | ||||||||||||
Interest expense | ||||||||||||||||
Deposits | 1,536,897 | 398,070 | 4,067,626 | 845,857 | ||||||||||||
Net interest income | 8,009,970 | 7,158,425 | 22,842,198 | 18,645,577 | ||||||||||||
Provision for credit losses | (80,000 | ) | 50,000 | 340,000 | 275,000 | |||||||||||
Net interest income after provision for credit losses | 8,089,970 | 7,108,425 | 22,502,198 | 18,370,577 | ||||||||||||
Noninterest income | ||||||||||||||||
Debit card and ATM | 389,308 | 380,426 | 1,135,154 | 1,090,950 | ||||||||||||
Service charges on deposit accounts | 220,934 | 248,371 | 718,338 | 707,891 | ||||||||||||
Merchant payment processing | 211,272 | 233,975 | 364,068 | 396,534 | ||||||||||||
Income from bank owned life insurance and annuities | 115,208 | 97,910 | 398,303 | 244,302 | ||||||||||||
Income from bank owned life insurance death proceeds | - | 133,355 | - | 408,929 | ||||||||||||
Dividends | 8,180 | 4,755 | 31,401 | 17,327 | ||||||||||||
Gain (loss) on disposition of debt securities | (84,394 | ) | - | (142,680 | ) | 645 | ||||||||||
Gain on transfer of other real estate owned | 101,091 | - | 101,091 | - | ||||||||||||
Gain on disposition of fixed assets | - | - | - | 60 | ||||||||||||
Gain on equity securities, at cost | - | - | - | 7,018 | ||||||||||||
Miscellaneous | 101,420 | 91,814 | 344,995 | 251,895 | ||||||||||||
Total noninterest income | 1,063,019 | 1,190,606 | 2,950,670 | 3,125,551 | ||||||||||||
Noninterest expenses | ||||||||||||||||
Salaries | 1,581,341 | 1,449,697 | 4,655,355 | 4,330,687 | ||||||||||||
Employee benefits | 456,799 | 396,463 | 1,490,701 | 994,190 | ||||||||||||
Occupancy | 259,011 | 229,279 | 777,752 | 708,318 | ||||||||||||
Furniture and equipment | 210,192 | 214,914 | 595,898 | 658,251 | ||||||||||||
Data processing | 248,162 | 210,053 | 725,716 | 614,465 | ||||||||||||
Debit card and ATM | 227,864 | 185,333 | 571,623 | 475,277 | ||||||||||||
Marketing | 159,203 | 99,126 | 464,194 | 374,659 | ||||||||||||
Directors fees | 74,350 | 80,500 | 223,925 | 237,800 | ||||||||||||
Telecommunication services | 66,534 | 66,768 | 197,480 | 230,327 | ||||||||||||
Deposit insurance premiums | 107,240 | 62,499 | 302,680 | 182,378 | ||||||||||||
Other operating | 472,959 | 408,385 | 1,563,977 | 1,245,237 | ||||||||||||
Total noninterest expenses | 3,863,655 | 3,403,017 | 11,569,301 | 10,051,589 | ||||||||||||
Income before income taxes | 5,289,334 | 4,896,014 | 13,883,567 | 11,444,539 | ||||||||||||
Income taxes | 1,156,000 | 1,188,000 | 3,136,000 | 2,764,500 | ||||||||||||
Net income | $ | 4,133,334 | $ | 3,708,014 | $ | 10,747,567 | $ | 8,680,039 | ||||||||
Earnings per common share - basic and diluted | $ | 1.50 | $ | 1.34 | $ | 3.90 | $ | 3.14 |
###
About Calvin B. Taylor Banking Company
Calvin B. Taylor Banking Company, the bank subsidiary of Calvin B. Taylor Bankshares, Inc. (OTCQX: TYCB), founded in 1890, offers a wide range of loan, deposit, and ancillary banking services through both physical and digital delivery channels. The Company has 12 banking locations within the eastern coastal area of the Delmarva Peninsula including Worcester County, Maryland, Sussex County, Delaware and Accomack County, Virginia.
Contact
M. Dean Lewis, Senior Vice President and Chief Financial Officer
410-641-1700, taylorbank.com
SOURCE: Calvin B. Taylor Bankshares, Inc.
View source version on accesswire.com:
https://www.accesswire.com/813881/calvin-b-taylor-bankshares-inc-reports-third-quarter-2023-financial-results
FAQ
What is the net income for Calvin B. Taylor Bankshares, Inc. for the nine months ended September 30, 2023?
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