William Penn Bancorporation Announces First Quarter Results
William Penn Bancorporation (NASDAQ:WMPN) reported a net income of $1.2 million, or $0.08 per diluted share, for Q3 2021, up from $670 thousand the previous year. This quarter's results included a $235 thousand income tax benefit related to the CARES Act. The company invested $53.2 million in high-quality securities and prepaid $7.0 million in higher-cost FHLB advances. New loan originations stood at $23.8 million, but net loans fell by $7.0 million to $454.2 million. Core deposits grew at an annualized rate of 17.4%, as it opened a new branch in Doylestown, PA.
- Net income increased by 79.1% year-over-year, from $670 thousand to $1.2 million.
- Core deposit growth at an annualized rate of 17.4%.
- Acquired $53.2 million in high-quality investment securities.
- Originated $23.8 million in new loans despite market challenges.
- Net loans decreased by $7.0 million, or 1.5%, to $454.2 million.
- Net interest margin declined from 3.11% to 2.80% year-over-year.
- Book value per share fell from $14.30 to $14.04, primarily due to a special dividend.
BRISTOL, PA / ACCESSWIRE / October 21, 2021 / William Penn Bancorporation ("William Penn" or the "Company") (NASDAQ:WMPN), the parent company of William Penn Bank (the "Bank"), today announced its financial results for the quarter ended September 30, 2021. William Penn recorded net income of
Kenneth J. Stephon, William Penn's Chairman, President and CEO, stated: "We continue to focus on the deployment of excess cash and the prudent management of our balance sheet to help us in achieving our strategic and financial growth goals. The low interest rate environment has made it challenging to effectively deploy the excess cash we hold on our balance sheet. We used
Highlights for the quarter ended September 30, 2021 are as follows:
- William Penn recorded net income of
$1.2 million , or$0.08 per diluted share. - William Penn recognized a
$235 thousand , or$0.02 per diluted share, income tax benefit related to refunds received associated with the carryback of net operating losses under the CARES Act. - William Penn purchased
$53.2 million of high-quality investment securities that it anticipates will provide a steady stream of cash flows both in the current and in rising interest rate environments. - William Penn prepaid
$7.0 million of higher-cost advances from the FHLB and incurred$64 thousand of prepayment penalties in connection with such prepayments. - William Penn originated
$23.8 million of new loans. - Core deposits increased at an annualized rate of
17.4% . - William Penn opened a new branch located in Doylestown in Bucks County, Pennsylvania.
- William Penn paid a
$0.30 per share one-time special cash dividend in August 2021. - Book value per share measured
$14.04 as of September 30, 2021 compared to$14.30 as of June 30, 2021. Tangible book value per share(1) measured$13.67 as of September 30, 2021 compared to$13.92 as of June 30, 2021. The decline in both book value and tangible book value was primarily due to the payment of the previously mentioned special dividend. - Asset quality metrics continued to remain strong with non-performing assets to total assets of
0.68% as of September 30, 2021. Our allowance for loan losses totaled$3.6 million , or0.78% of total loans and1.16% of total loans, excluding acquired loans(2), as of September 30, 2021, compared to$3.6 million , or0.78% of total loans and1.19% of total loans, excluding acquired loans(2), as of June 30, 2021.
Statement of Financial Condition
Total assets increased
Cash and cash equivalents decreased
Total investments increased
Net loans decreased
Bank-owned life insurance increased
Deposits increased
Borrowings decreased
Stockholders' equity decreased
Net Interest Income
For the quarter ended September 30, 2021, net interest income was
Non-interest Income
For the quarter ended September 30, 2021, non-interest income totaled
Non-interest Expense
For the quarter ended September 30, 2021, non-interest expense totaled
Income Taxes
For the quarter ended September 30, 2021, we recorded a
Asset Quality
The provision for loan losses was a
Capital
The Bank's capital position remains strong relative to current regulatory requirements. The Bank continues to have substantial liquidity that has been retained in cash or invested in high quality government-backed securities. As of September 30, 2021, William Penn's tangible capital to tangible assets totaled
About William Penn Bancorporation
William Penn Bancorporation, headquartered in Bristol, Pennsylvania, is the holding company for William Penn Bank, which serves the Delaware Valley area through twelve full-service branch offices in Bucks County and Philadelphia, Pennsylvania, and Burlington and Camden Counties in New Jersey. The Company's executive offices are located at 10 Canal Street, Suite 104, Bristol, Pennsylvania 19007. William Penn Bank's deposits are insured up to the legal maximum (generally
Forward-Looking Statements
This news release may contain forward-looking statements, which can be identified by the use of words such as "believes," "expects," "anticipates," "estimates" or similar expressions. Such forward-looking statements and all other statements that are not historic facts are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors. These factors include, but are not limited to, general economic conditions, the effect of the COVID-19 pandemic (including its impact on our business operations and credit quality, on our customers and their ability to repay their loan obligations and on general economic and financial market conditions), changes in the interest rate environment, legislative or regulatory changes that may adversely affect our business, changes in accounting policies and practices, changes in competition and demand for financial services, adverse changes in the securities markets, changes in deposit flows, changes in the quality or composition of our loan or investment portfolios and our ability to successfully integrate the business operations of acquired businesses into our business operations, and that the Company may not be successful in the implementation of its business strategy or its deployment of the proceeds raised in its second step conversion offering. Additionally, other risks and uncertainties may be described in William Penn's Annual Report on Form 10-K for the year ended June 30, 2021, which is available through the SEC's EDGAR website located at www.sec.gov. Should one or more of these risks materialize, actual results may vary from those anticipated, estimated or projected. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as may be required by applicable law or regulation, William Penn assumes no obligation to update any forward-looking statements.
(1)As used in this press release, tangible book value per share is a non-GAAP financial measure. This non-GAAP financial measure excludes goodwill and other intangible assets. For a reconciliation of this and other non-GAAP financial measures to their comparable GAAP measures, see "Non-GAAP Reconciliation" at the end of the press release.
(2)As used in this press release, the ratio of the allowance for loan losses to total loans, excluding acquired loans, is a non-GAAP financial measure. This non-GAAP financial measure excludes loans acquired in a business combination. For a reconciliation of this and other non-GAAP financial measures to their comparable GAAP measure, see "Non-GAAP Reconciliation" at the end of the press release.
CONTACT:
Kenneth J. Stephon
Chairman, President and CEO
(856) 656-2201, ext. 1009
WILLIAM PENN BANCORPORATION AND SUBSIDIARIES Unaudited Consolidated Statements of Financial Condition (Dollars in thousands, except share amounts) | |||||||||||
| September 30, | June 30, | September 30, | |||||||||
| 2021 | 2021 | 2020 | |||||||||
ASSETS | |||||||||||
Cash and due from banks | $ | 8,368 | $ | 11,102 | $ | 11,336 | |||||
Interest bearing deposits with other banks | 119,580 | 157,620 | 34,539 | ||||||||
Federal funds sold | - | - | 10,207 | ||||||||
Total cash and cash equivalents | 127,948 | 168,722 | 56,082 | ||||||||
Interest-bearing time deposits | 1,350 | 1,850 | 2,300 | ||||||||
Securities available for sale | 127,007 | 123,335 | 123,597 | ||||||||
Securities held to maturity | 38,127 | - | - | ||||||||
Equity securities | 2,635 | - | - | ||||||||
Loans receivable, net of allowance for loan losses of | 454,157 | 461,196 | 497,630 | ||||||||
Premises and equipment, net | 13,464 | 13,439 | 13,924 | ||||||||
Regulatory stock, at cost | 2,597 | 2,954 | 3,219 | ||||||||
Deferred income taxes | 3,716 | 3,574 | 4,448 | ||||||||
Bank-owned life insurance | 37,469 | 35,231 | 14,870 | ||||||||
Goodwill | 4,858 | 4,858 | 4,858 | ||||||||
Intangible assets | 880 | 937 | 1,128 | ||||||||
Accrued interest receivable and other assets | 8,733 | 6,312 | 9,497 | ||||||||
TOTAL ASSETS | $ | 822,941 | $ | 822,408 | $ | 731,553 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
LIABILITIES | |||||||||||
Deposits | $ | 561,204 | $ | 553,103 | $ | 581,493 | |||||
Advances from Federal Home Loan Bank | 34,000 | 41,000 | 41,000 | ||||||||
Advances from borrowers for taxes and insurance | 2,064 | 3,731 | 2,910 | ||||||||
Accrued interest payable and other liabilities | 12,628 | 7,648 | 10,644 | ||||||||
TOTAL LIABILITIES | 609,896 | 605,482 | 636,047 | ||||||||
STOCKHOLDERS' EQUITY | |||||||||||
Preferred stock, | - | - | - | ||||||||
Common Stock, | 152 | 152 | 467 | ||||||||
Additional paid-in capital | 168,354 | 168,349 | 42,932 | ||||||||
Treasury stock, at cost | - | - | (3,710) | ||||||||
Unearned common stock held by employee stock ownership plan | (9,901) | (10,004) | - | ||||||||
Retained earnings | 55,102 | 58,493 | 55,384 | ||||||||
Accumulated other comprehensive (loss) income | (662) | (64) | 433 | ||||||||
TOTAL STOCKHOLDERS' EQUITY | 213,045 | 216,926 | 95,506 | ||||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 822,941 | $ | 822,408 | $ | 731,553 | |||||
WILLIAM PENN BANCORPORATION AND SUBSIDIARIES Unaudited Consolidated Statements of Income (Dollars in thousands, except per share amounts) | ||||||||||||
| For the Quarter Ended | ||||||||||||
| September 30, 2021 | June 30, 2021 | September 30, 2020 | ||||||||||
INTEREST INCOME | ||||||||||||
Loans receivable, including fees | $ | 5,214 | $ | 5,563 | $ | 5,893 | ||||||
Securities | 664 | 519 | 653 | |||||||||
Other | 106 | 93 | 111 | |||||||||
Total interest income | 5,984 | 6,175 | 6,657 | |||||||||
INTEREST EXPENSE | ||||||||||||
Deposits | 484 | 502 | 1,081 | |||||||||
Borrowings | 238 | 265 | 359 | |||||||||
Total interest expense | 722 | 767 | 1,440 | |||||||||
Net interest income | 5,262 | 5,408 | 5,217 | |||||||||
(Recovery) provision for loan losses | (30) | 20 | 66 | |||||||||
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 5,292 | 5,388 | 5,151 | |||||||||
OTHER INCOME | ||||||||||||
Service fees | 213 | 217 | 183 | |||||||||
Net gain on sale of securities | 62 | 31 | - | |||||||||
Earnings on bank-owned life insurance | 238 | 153 | 112 | |||||||||
Net gain on disposition of premises and equipment | - | 60 | 15 | |||||||||
Unrealized gain on equity securities, net | 105 | - | - | |||||||||
Other | 87 | 75 | 90 | |||||||||
Total other income | 705 | 536 | 400 | |||||||||
OTHER EXPENSES | ||||||||||||
Salaries and employee benefits | 2,712 | 2,712 | 2,554 | |||||||||
Occupancy and equipment | 675 | 685 | 759 | |||||||||
Data processing | 421 | 445 | 422 | |||||||||
Professional fees | 248 | 466 | 188 | |||||||||
Amortization of intangible assets | 57 | 63 | 64 | |||||||||
Loss on lease abandonment | - | 162 | - | |||||||||
Prepayment penalties | 64 | - | 161 | |||||||||
Other | 690 | 567 | 587 | |||||||||
Total other expense | 4,867 | 5,100 | 4,735 | |||||||||
Income before income taxes | 1,130 | 824 | 816 | |||||||||
Income tax (benefit) expense | (30) | 158 | 146 | |||||||||
NET INCOME | $ | 1,160 | $ | 666 | $ | 670 | ||||||
Basic and diluted earnings per share | $ | 0.08 | $ | 0.05 | $ | 0.05 | ||||||
WILLIAM PENN BANCORPORATION AND SUBSIDIARIES Unaudited Selected Consolidated Financial and Other Data (Dollars in thousands) | ||||||||||||||||||||||
| For the Quarter Ended | ||||||||||||||||||||||
| September 30, 2021 | September 30, 2020 | |||||||||||||||||||||
| Average | Interest and | Yield/ | Average | Interest and | Yield/ | |||||||||||||||||
| Balance | Dividends | Cost | Balance | Dividends | Cost | |||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||
Loans | $ | 459,034 | $ | 5,214 | $ | 503,014 | $ | 5,893 | ||||||||||||||
Investment securities | 131,784 | 664 | 2.02 | 109,077 | 653 | 2.39 | ||||||||||||||||
Other interest-earning assets | 160,400 | 106 | 0.26 | 59,940 | 111 | 0.74 | ||||||||||||||||
Total interest-earning assets | 751,218 | 5,984 | 3.19 | 672,031 | 6,657 | 3.96 | ||||||||||||||||
Non-interest-earning assets | 71,109 | 59,361 | ||||||||||||||||||||
Total assets | $ | 822,327 | $ | 731,392 | ||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||
Interest-bearing checking accounts | $ | 103,803 | 19 | 0.07 | $ | 101,268 | 51 | 0.20 | ||||||||||||||
Money market deposit accounts | 145,032 | 122 | 0.34 | 137,852 | 326 | 0.95 | ||||||||||||||||
Savings, including club deposits | 101,171 | 26 | 0.10 | 94,775 | 43 | 0.18 | ||||||||||||||||
Certificates of deposit | 155,786 | 317 | 0.81 | 198,320 | 661 | 1.33 | ||||||||||||||||
Total interest-bearing deposits | 505,792 | 484 | 0.38 | 532,215 | 1,081 | 0.81 | ||||||||||||||||
FHLB advances and other borrowings | 35,457 | 238 | 2.68 | 55,058 | 359 | 2.61 | ||||||||||||||||
Total interest-bearing liabilities | 541,249 | 722 | 0.53 | 587,273 | 1,440 | 0.98 | ||||||||||||||||
Non-interest-bearing liabilities: | ||||||||||||||||||||||
Non-interest-bearing deposits | 50,670 | 41,260 | ||||||||||||||||||||
Other non-interest-bearing liabilities | 15,520 | 5,837 | ||||||||||||||||||||
Total liabilities | 607,439 | 634,370 | ||||||||||||||||||||
Total equity | 214,888 | 97,022 | ||||||||||||||||||||
Total liabilities and equity | $ | 822,327 | $ | 731,392 | ||||||||||||||||||
Net interest income | $ | 5,262 | $ | 5,217 | ||||||||||||||||||
Interest rate spread | ||||||||||||||||||||||
Net interest-earning assets | $ | 209,969 | $ | 84,758 | ||||||||||||||||||
Net interest margin | ||||||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | ||||||||||||||||||||||
| Asset Quality Indicators (unaudited) | ||||||||||||
| September 30, | June 30, | September 30, | ||||||||||
(Dollars in thousands) | 2021 | 2021 | 2020 | |||||||||
Non-performing assets: | ||||||||||||
Non-accruing loans | $ | 5,555 | $ | 5,301 | $ | 4,775 | ||||||
Accruing loans past due 90 days or more | - | - | - | |||||||||
Total non-performing loans | $ | 5,555 | $ | 5,301 | $ | 4,775 | ||||||
Real estate owned | 75 | 75 | 100 | |||||||||
Total non-performing assets | $ | 5,630 | $ | 5,376 | $ | 4,875 | ||||||
Non-performing loans to total loans | ||||||||||||
Non-performing assets to total assets | ||||||||||||
ALLL to total loans and leases | ||||||||||||
ALLL to non-performing loans | ||||||||||||
| Key annualized performance ratios are as follows for the quarter (unaudited): | |||||||
| For the Quarter Ended | |||||||
| September 30, | June 30, | September 30, | |||||
| 2021 | 2021 | 2020 | |||||
PERFORMANCE RATIOS: | |||||||
(annualized for the quarter ended) | |||||||
Return on average assets | |||||||
Return on average equity | |||||||
Net interest margin | |||||||
Net charge-off ratio | (0.01)% | ||||||
Efficiency ratio | |||||||
Tangible common equity | |||||||
Non-GAAP Reconciliation (unaudited)
In this press release, we present the non-GAAP financial measures included in the tables below, which are used to evaluate our performance and exclude the effects of certain transactions and one-time events that we believe are unrelated to our core business and not necessarily indicative of our current performance or financial position. Management believes excluding these items facilitates greater visibility into our core businesses and underlying trends that may, to some extent, be obscured by inclusion of such items. The following tables include a reconciliation of the non-GAAP financial measures used in this press release to their comparable GAAP measures.
| William Penn Bancorporation and Subsidiaries Non-GAAP Reconciliation (Dollars in thousands, except share and per share data) | ||||||
| September 30, | June 30, | |||||
| 2021 | 2021 | |||||
Calculation of tangible book value per share: | ||||||
Total Stockholders' Equity | $ | 213,045 | $ | 216,926 | ||
Less: Goodwill and other intangible assets | 5,738 | 5,795 | ||||
Total tangible equity (non-GAAP) | $ | 207,307 | $ | 211,131 | ||
Total common shares outstanding | 15,170,566 | 15,170,566 | ||||
Book value per share (GAAP) | $ | 14.04 | $ | 14.30 | ||
Tangible book value per share (non-GAAP) | $ | 13.67 | $ | 13.92 | ||
Calculation of the ratio of the allowance for loan losses to total loans, excluding acquired loans: | ||||||
Gross loans receivable | $ | 458,512 | $ | 465,629 | ||
Less: Loans acquired in a business combination | 149,195 | 161,260 | ||||
Gross loans receivable, excluding acquired loans (non-GAAP) | $ | 309,317 | $ | 304,369 | ||
Allowance for loan losses | $ | 3,591 | $ | 3,613 | ||
Allowance for loan losses to total loans (GAAP) | ||||||
Allowance for loan losses to total loans, excluding acquired loans (non-GAAP) | ||||||
SOURCE: William Penn Bancorporation
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FAQ
What were William Penn Bancorporation's financial results for Q3 2021?
How much did William Penn invest in high-quality securities in Q3 2021?
What was the trend in core deposits for William Penn in Q3 2021?
Did William Penn experience any changes in loan originations?
What was the impact of the special dividend on William Penn's stockholders' equity?
