Tri-County Financial Group, Inc. Reports Fourth Quarter 2020 Financial Results

Rhea-AI Summary

Tri-County Financial Group (TYFG) reported strong financial results for Q4 2020, showcasing a net income of $5.8 million ($2.36 per share), significantly up from $1.8 million ($0.74 per share) in Q4 2019. The company achieved record annual earnings of $20.1 million, a 127% increase from $8.9 million in 2019. Net interest income rose to $38.8 million and noninterest income surged to $35.9 million, largely driven by a 155% increase in mortgage banking fees. Despite a 15% rise in noninterest expenses, robust loan growth and a solid capital position underscore the company’s positive trajectory.

Positive

• Net income for Q4 2020 was $5.8 million, up 222% YoY.
• Full-year 2020 net income reached $20.1 million, a 127% YoY increase.
• Net interest income rose to $38.8 million, compared to $33.5 million in 2019.
• Noninterest income increased by 115%, primarily from a $14.6 million rise in mortgage banking fees.
• Total loans increased by $79.1 million, or 8%, to $1.05 billion.
• Deposits surged by $167.8 million, or 17.3%, year-over-year.

Negative

• Nonperforming loans increased to 0.73% of total loans from 0.58% in the previous year.
• Noninterest expenses rose by 15% to $42.0 million, largely due to increased mortgage banking activity.

MENDOTA, Ill., April 13, 2021 /PRNewswire/ -- Tri-County Financial Group, Inc. (The Company) (OTCQX: TYFG) today announced financial results for the fourth quarter of 2020.

Net income for the fourth quarter of 2020 was $5.8 million ($2.36 per share), compared to $1.8 million ($0.74 per share) during the fourth quarter of 2019. The Company has experienced record earnings for the twelve months ended December 31, 2020, with net income of $20.1 million, compared to $8.9 million for the twelve months ended December 31, 2019, an increase of $11.3 million or 127%.

Net interest income was $38.8 million during the twelve months ended December 31, 2020, compared to $33.5 million for the twelve months ended December 31, 2019. The net interest margin was 3.31% in 2020, and 3.19% in 2019.

Noninterest income was $35.9 million for the twelve months ended December 31, 2020, an increase of $19.2 million, or 115.0%, compared to $16.7 million during the twelve months ended December 31, 2019. The increase can be primarily attributed to growth in mortgage banking fees which increased by $14.6 million, or 155%, from $9.4 million in the prior year. First State Mortgage net income increased by $9.6 million and contributed $10.2 million for the year, compared to $0.6 million for all of 2019.

Noninterest expense was $42.0 million during the twelve months ended December 31, 2020, compared to $36.4 million for the twelve months ended December 31, 2019, an increase of $5.6 million, or 15%. Most of this increase is related to the increased mortgage banking activity, as well as expenses related to the Bank's core processing conversion to Fiserv Premier.

Total loans increased $79.1 million, or 8%, to $1.05 billion from $973 million at December 31, 2019. There were $30.1 million in Paycheck Protection Plan (PPP) loans included in loan balances at December 31, 2020. Nonperforming loans as a percent of total loans were 0.73% as of December 31, 2020, up slightly from .58% at December 31, 2019.

The Company adjusted the Bank's provision for loan loss to reflect potential increased credit risk, due to the COVID-19 pandemic. After taking an additional $1.5 million the fourth quarter of 2020, the Company has taken $5.1 million during 2020, an increase of $3.3 million over the prior year. The allowance for loan loss ended at $15.5 million at December 31, 2020.

Deposits increased $167.8 million, or 17.3%, year-over-year, with much of the growth due to COVID relief programs and PPP funding.  As a result, borrowed money decreased significantly at December 31, 2020, ending at $25.1 million, compared to $33.8 million at December 31, 2019. The investment portfolio of $99.4 million decreased slightly over the same period, down from $101.7 million at December 31, 2019.

The Company's capital levels remain solid as of December 31, 2020, with a Tier 1 leverage ratio of 9.70% and a total risk-based ratio of 13.8%, compared to 9.9% and 13.3%, respectively, as of December 31, 2019. Stimulus relief funding and PPP lending impacted capital ratios at year end 2020 due to strong deposit growth and the SBA guarantee of the PPP loans which carry a 0% risk-weighting.

On December 30, 2020, the Board of Directors declared a regular dividend of $0.15 per share and a special dividend of $0.15 per share for a total of $0.30 per share payable January 14, 2021, to shareholders of record as of December 31, 2020.

In announcing the results, President and Chief Executive Officer, Tim McConville, stated "Our fourth quarter numbers continued a strong trend and were some of the best in our history. Once again, the strong results from our mortgage subsidiary contributed to the record earnings performance despite significantly increasing our reserves. We are monitoring what effect COVID-19 will have on our credits, but most likely it will be mid-2021 before we have a clearer picture. We do believe, however, we are well-positioned to absorb any losses we may encounter. Growth continues to occur at an impressive pace as we head into 2021."

Tri-County Financial Group, Inc. is the parent holding company for First State Bank, with offices in Mendota, Batavia, Bloomington, Geneva, LaMoille, McNabb, North Aurora, Ottawa, Peru, Princeton, Rochelle, Shabbona, St. Charles, Streator, Sycamore, Waterman and West Brooklyn. First State Bank is the parent company of First State Mortgage, LLC and First State Insurance. Tri-County Financial Group, Inc. shares are quoted under the symbol TYFG and traded on OTCQX.

 

TRI COUNTY FINANCIAL GROUP, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
YEAR TO DATE
(000s omitted, except share data)
			2020		2019
Interest Income			$         50,322		$    48,088
Interest Expense			11,503		14,548
Net Interest Income			38,819		33,540
Provision for Loan Losses			5,050		1,800
Net Interest Income After Provision for Loan Losses			33,769		31,740
Other Income			35,869		16,681
FDIC Assessments			426		134
Other Expenses			41,952		36,471
Income Before Income Taxes			27,260		11,816
Applicable Income Taxes			7,410		2,943
Security Gains (Losses)			293		-
Net Income (Loss)			$         20,143		$      8,873
Basic Net Income Per Share			$             8.16		$        3.61
Weighted Average Shares Outstanding			2,469,572		2,456,990

 

TRI-COUNTY FINANCIAL GROUP, INC. & SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(000s omitted, except share data)
ASSETS		12/31/2020		12/31/2019
Cash and Due from Banks		84,047		14,231
Federal Funds Sold		25,934		2,420
Investment Securities		99,437		101,715
Loans and Leases		1,051,578		972,501
Less:  Reserve for Loan Losses		(15,508)		(12,412)
Loans, Net		1,036,070		960,089
Bank Premises & Equipment		27,926		25,100
Goodwill		8,425		6,917
Other Real Estate Owned		2,648		2,725
Accrued Income Receivable		5,147		6,051
Other Assets		38,206		24,533
TOTAL ASSETS		1,327,840		1,143,781
LIABILITIES
Noninterest-bearing Deposits		180,246		108,954
Interest-bearing Deposits		957,801		861,302
Total Deposits		1,138,047		970,256
Repurchase Agreements		21,059		12,748
FHLB and Other Borrowings		4,000		21,003
Accrued Interest and Other Liabilities		21,292		16,241
Subordinated Debt		15,696		15,643
Total Borrowings		40,988		52,888
Dividends Payable		751		379
TOTAL LIABILITIES		1,200,845		1,036,270
CAPITAL
Common Stock		2,476		2,462
Surplus		25,675		25,527
Retained Earnings		95,300		77,010
FASB 115 Adjustment		3,544		2,512
TOTAL CAPITAL		126,995		107,511
TOTAL LIABILITIES AND CAPITAL		1,327,840		1,143,781
Book Value Per Share		$         51.29		$         43.66
Bid Price		$         35.25		$         40.60

Contact:
Connie Ganz, Senior Vice President
815.538.2265

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SOURCE Tri-County Financial Group, Inc

FAQ

What were Tri-County Financial Group's earnings for Q4 2020?

Tri-County Financial Group reported net income of $5.8 million for Q4 2020.

How did Tri-County Financial Group perform in 2020?

The company achieved record annual earnings of $20.1 million, a 127% increase from 2019.

What factors contributed to the increase in Tri-County Financial Group's net interest income?

Net interest income rose to $38.8 million in 2020, up from $33.5 million in 2019, due to effective loan growth.

What is the status of Tri-County Financial Group's loan portfolio?

Total loans grew by $79.1 million, or 8%, to $1.05 billion, with nonperforming loans increasing slightly to 0.73%.

Did Tri-County Financial Group declare any dividends in 2020?

Yes, the Board declared a regular and special dividend totaling $0.30 per share, payable January 14, 2021.