U & I Financial Corp. Reports Second Quarter 2023 Financial Results

Rhea-AI Summary

U & I Financial Corp. (OTCQX:UNIF) reported quarterly earnings of $2.4 million or $0.44 per share in the second quarter, a decrease from $2.6 million or $0.48 per share in the same quarter of 2022. Total assets reached $607.2 million, increasing by $84.3 million or 16.1% from the previous year. Net loans increased by $60.3 million or 14.3% to $482.1 million, and total deposits grew by $89.4 million or 20.9% to $516.9 million.

Positive

• Total assets grew by 16.1% to $607.2 million.
• Net loans increased by 14.3% to $482.1 million.
• Total deposits grew by 20.9% to $516.9 million.

Negative

• Quarterly earnings decreased from $2.6 million to $2.4 million.
• Net interest margin decreased from 4.73% to 4.24%.
• Nonperforming assets to total assets decreased to 0% from 0.05%.

LYNNWOOD, WA / ACCESSWIRE / July 27, 2023 / U & I Financial Corp. (OTCQX:UNIF), the holding company for UniBank, today reported quarterly earnings of $2.4 million or $0.44 per share in the second quarter, as compared to $2.6 million or $0.48 per share for the same quarter of 2022, decreasing by $265 thousand or $0.04 per share, primarily from attaining less Gain on Sale of SBA/USDA Loans.

As of June 30, 2023, Total Assets reached $607.2 million, increasing by $84.3 million or 16.1% from the year earlier period of $522.9 million. Net Loans ended at $482.1 million, increasing by $60.3 million or 14.3% from the year earlier period of $421.7 million. Finally, Total Deposits grew by $89.4 million or 20.9% to $516.9 million from the year earlier period of $427.5 million.

"Although we experienced a year-over-year quarterly earnings decline primarily caused by the decrease in the SBA loan demand, our earning assets have continued to grow, while diversifying out of the CRE concentration," said Peter Park, President and CEO. He added that, "In the foreseeable future, however, we anticipate slowdown in overall loan demand and ongoing compression of the Net Interest Margin. On the credit side, we are beginning to see signs of credit deterioration due to economic uncertainties as well as the increased loan payment burden of our variable rate borrowers. Although the current environment is not favorable to the community banking industry, we believe that we are strategically well positioned to sustain our commitment to creating shareholder value in the long run."

2023 Second Quarter Financial Highlights

Total assets grew 16.1% to $607.2 million as compared to $522.9 million a year ago.

Net loans increased 14.3% to $482.1 million as compared to $421.7 million a year ago.

Total deposits grew 20.9% to $516.9 million as compared to $427.5 million a year ago.

Net income quarter-to-date decreased 10.1% to $2.4 million as compared to $2.6 million a year ago.

Net income year-to-date grew 7.2% to $5.0 million as compared to $4.7 million a year ago.

Net interest margin for the year was 4.24% as compared to 4.73% a year ago.

Gain on sale of SBA/USDA loans for the year was $824 thousand as compared to $1.2 million a year ago.

Return on average equity for the year was 13.59% as compared to 14.17% a year ago.

Return on average assets for the year was 1.72% as compared to 2.10% a year ago.

The allowance for loan losses to loans was 1.04% as compared to 1.07% a year ago.

Nonperforming assets to total assets was 0% as compared to 0.05% a year ago.

Efficiency ratio (noninterest expense divided by revenue) for the year was 53.51% as compared to 50.87% a year ago.

About U & I Financial Corp.

UniBank, the wholly owned subsidiary of U & I Financial Corp. (OTCQX:UNIF), is one of the highest performing banks in Washington state in terms of return on assets. Founded in 2006 and based in Lynnwood, Washington, the Bank serves small to medium-sized businesses, professionals, and individuals across the United States with a particular emphasis on government guaranteed loan programs. Customers can access their accounts in any of the 4 branches - Lynnwood, Bellevue, Federal Way and Tacoma - online, or through the Bank's ATM network.

For more information visit www.unibankusa.com or call (425) 275-9700.

Forward-Looking Statement Safe Harbor: This news release contains comments or information that constitutes forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are based on current expectations that involve a number of risks and uncertainties. Forward-looking statements describe U & I Financial Corp.'s projections, estimates, plans and expectations of future results and can be identified by words such as "believe," "intend," "estimate," "likely," "anticipate," "expect," "looking forward," and other similar expressions. They are not guarantees of future performance. Actual results may differ materially from the results expressed in these forward-looking statements, which because of their forward-looking nature, are difficult to predict. Investors should not place undue reliance on any forward-looking statement, and should consider factors that might cause differences including but not limited to the degree of competition by traditional and nontraditional competitors, declines in real estate markets, an increase in unemployment or sustained high levels of unemployment; changes in interest rates; adverse changes in local, national and international economies; changes in the Federal Reserve's actions that affect monetary and fiscal policies; changes in legislative or regulatory actions or reform, including without limitation, the Dodd-Frank Wall Street Reform and Consumer Protection Act; demand for products and services; changes to the quality of the loan portfolio and our ability to succeed in our problem-asset resolution efforts; the ongoing uncertainties from COVID-19; the impact of technological advances; changes in tax laws; and other risk factors. U & I Financial Corp. undertakes no obligation to publicly update or clarify any forward-looking statement to reflect the impact of events or circumstances that may arise after the date of this release.

Contact:

U & I Financial Corp.
Investor Relations
Simon Bai, 425-275-9704

STATEMENT OF INCOME (Unaudited)
	Jun-23				Mar-23				Jun-22				Jun-23				Jun-22
(Dollars in thousands except EPS)	QTD				QTD				QTD				YTD				YTD
Interest Income	$	9,955			$	8,775			$	5,601			$	18,730			$	10,479
Interest Expense		3,723				2,900				257				6,623				424
Net Interest Income		6,232				5,875				5,344				12,107				10,055
Provision for Loan Losses		-				-				-				-				-
Gain on Sale of SBA/USDA Loans		-				824				737				824				1,157
Loan Servicing Fees, Net of Amortization		172				205				80				377				189
Other Non-interest Income		329				173				174				502				345
Non-interest Income		501				1,202				991				1,703				1,691
Salaries & Benefits		2,395				2,634				2,018				5,029				3,939
Occupancy Expense		175				179				181				354				355
Other Expense		1,055				951				884				2,006				1,681
Non-interest Expense		3,625				3,764				3,083				7,389				5,975
Net Income before Income Taxes		3,108				3,313				3,252				6,421				5,771
Income Taxes		738				638				617				1,376				1,066
Net Income/(Loss)	$	2,370			$	2,675			$	2,635			$	5,045			$	4,705
Total Outstanding Shares (in thousands)		5,441				5,441				5,505				5,441				5,505
Basic Earnings per Share	$	0.44			$	0.49			$	0.48			$	0.93			$	0.85
Statement of Condition (Unaudited)
		Jun-23				Mar-23				Jun-22				Variance				Variance
(Dollars in thousands)		Qtr End				Qtr End				Qtr End				Prior Qtr				Prior Year
Cash and Due from Banks	$	48,684			$	47,550			$	18,620			$	1,134			$	30,064
Investments		49,714				50,303				51,927				(589)				(2,213)
Loans Held for Sale		-				-				4,703				-				(4,703)
Gross Loans		487,126				469,614				426,316				17,512				60,810
Allowance for Loan Losses		(5,076)				(4,580)				(4,580)				(496)				(496)
Net Loans		482,050				465,034				421,736				17,016				60,314
Fixed Assets		6,702				6,840				6,897				(138)				(195)
Other Assets		20,089				20,062				19,028				27				1,061
Total Assets	$	607,239			$	589,789			$	522,911			$	17,450			$	84,328
Checking	$	107,476			$	111,023			$	114,365			$	(3,547)			$	(6,889)
NOW		13,905				14,339				13,794				(434)				111
Money Market		213,825				221,312				130,024				(7,487)				83,801
Savings		9,744				11,448				17,852				(1,704)				(8,108)
Certificates of Deposit		171,986				145,614				151,513				26,372				20,473
Total Deposits		516,936				503,736				427,548				13,200				89,388
Borrowed Funds		10,000				7,000				25,000				3,000				(15,000)
Other Liabilities		3,192				3,816				3,124				(624)				68
Total Liabilities		530,128				514,552				455,672				15,576				74,456
Shareholders' Equity		77,111				75,237				67,239				1,874				9,872
Total Liabilities & Equity	$	607,239			$	589,789			$	522,911			$	17,450			$	84,328
Financial Ratios
		Jun-23				Mar-23				Jun-22				Jun-23				Jun-22
(Dollars in thousands except BVS)		QTD				QTD				QTD				YTD				YTD
Performance Ratios
Return on Average Assets		1.59%				1.84%				2.25%				1.72%				2.10%
Return on Average Equity		12.48%				14.73%				15.84%				13.59%				14.17%
Net Interest Margin		4.32%				4.17%				4.79%				4.24%				4.73%
Efficiency Ratio		53.85%				53.20%				48.67%				53.51%				50.87%
Capital
Tier 1 Leverage Ratio		13.11%				12.93%				14.49%
Common Equity Tier 1 Ratio		16.31%				16.30%				16.25%
Tier 1 Risk-Based Capital Ratio		16.31%				16.30%				16.25%
Total Risk-Based Capital Ratio		17.36%				17.27%				17.33%
Book Value per Share	$	14.17			$	13.83			$	12.21
Asset Quality
Net Loan Charge-Offs (Recoveries)	$	(942)			$	0			$	0
Allowance for Loan Losses to Loans		1.04%				0.98	%			1.07	%
Nonperforming Assets to Total Assets		0.00%				0.05	%			0.05	%

SOURCE: U & I Financial Corp. (Washington)

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FAQ

What were U & I Financial Corp.'s quarterly earnings in the second quarter of 2023?

U & I Financial Corp. reported quarterly earnings of $2.4 million or $0.44 per share in the second quarter of 2023.

How much did total assets increase by?

Total assets increased by $84.3 million or 16.1% from the previous year.

What was the growth in net loans?

Net loans increased by $60.3 million or 14.3% to $482.1 million.

What was the growth in total deposits?

Total deposits grew by $89.4 million or 20.9% to $516.9 million.

What was the decrease in quarterly earnings compared to the same quarter of 2022?

Quarterly earnings decreased by $265 thousand or $0.04 per share from the same quarter of 2022.

What was the decrease in net interest margin?

Net interest margin decreased from 4.73% to 4.24%.

What was the decrease in nonperforming assets to total assets?

Nonperforming assets to total assets decreased to 0% from 0.05%.