Growth in Noninterest-Bearing Deposits and Loans Drive Earnings Above Expectations

FAIRMONT, W.V.--()--MVB Financial Corp. (NASDAQ: MVBF) (“MVB Financial,” “MVB” or the “Company”) today reported net income of $9.2 million, or $0.79 basic and $0.73 diluted earnings per share for the three months ended June 30, 2021.

 

 

Quarterly

 

Year-to-Date

 

 

2021

 

2021

 

2020

 

2021

 

2020

 

 

Second Quarter

 

First Quarter

 

Second Quarter

 

 

Net income

 

$

9,247

 

 

$

8,085

 

 

$

18,034

 

 

$

17,332

 

 

$

19,082

 

Earnings per share - basic

 

$

0.79

 

 

$

0.70

 

 

$

1.50

 

 

$

1.49

 

 

$

1.58

 

Earnings per share - diluted

 

$

0.73

 

 

$

0.66

 

 

$

1.49

 

 

$

1.39

 

 

$

1.55

 

Our earnings for the second quarter were impacted by the release of allowance for loan losses of $1.5 million and costs related to acquisition and divestiture activity of $0.4 million. The after-tax impact of these items on a basic per share basis was $0.11 and $(0.03), respectively, and was $0.10 and $(0.03) on a diluted per share basis, respectively, for the three months ended June 30, 2021.

SECOND QUARTER 2021 HIGHLIGHTS

  • Financial technology (“Fintech”) and gaming initiatives drive continued transformation of MVB’s core funding profile
    • Noninterest-bearing (“NIB”) deposits were $932.7 million as of June 30, 2021, an increase of $95.4 million, or 11%, from March 31, 2021, and an increase of $404.1 million, or 76%, from June 30, 2020. NIB deposits as a percentage of total deposits were 41.8% as of June 30, 2021, compared to 37.8% as of March 31, 2021 and 28.4% as of June 30, 2020.
    • With the Company’s ever-expanding Banking-as-a-Service (“BaaS”) platform, MVB became the 18th largest bank in the United States based on the number of customer accounts.
    • Fintech deposits totaled $765.9 million as of June 30, 2021, an increase of $21.3 million, or 3%, from March 31, 2021 and an increase of $539.7 million, or 239%, from June 30, 2020.
    • Gaming deposits, which are included in total Fintech deposits, totaled $595.9 million as of June 30, 2021, an increase of $17.2 million, or 3%, from March 31, 2021 and an increase of $454.0 million, or 320%, from June 30, 2020.
  • Robust quarter-over-quarter revenue growth
    • Net interest income was $19.1 million for the quarter ended June 30, 2021, an increase of $1.6 million, or 9%, compared to the quarter ended March 31, 2021, and an increase of $0.6 million, or 3%, compared to the quarter ended June 30, 2020.
    • Fully tax-equivalent net interest margin was 3.24% for the quarter ended June 30, 2021, a decrease of 2 basis points compared to the quarter ended March 31, 2021, and a decrease of 54 basis points compared to the quarter ended June 30, 2020, primarily driven by Paycheck Protection Program (“PPP”) loans and excess liquidity.
    • Loans, including loans of branches held-for-sale of $54.5 million, were $1.75 billion as of June 30, 2021, an increase of $57.5 million, or 3%, from March 31, 2021, and an increase of $257.2 million, or 17%, from June 30, 2020.
    • Payment card and service charge income was $1.9 million for the quarter ended June 30, 2021, an increase of $0.4 million, or 29%, compared to the quarter ended March 31, 2021, and an increase of $1.4 million, or 265%, compared to the quarter ended June 30, 2020.
  • Continued strong value creation
    • Tangible book value (“TBV”) per share, a non-U.S. GAAP measure, was $20.54 as of June 30, 2021, an increase of $0.56, or 3%, from March 31, 2021, and an increase of $3.89, or 23%, from June 30, 2020. A reconciliation of TBV to its most comparable U.S. GAAP measure is included below.
    • MVB Bank, Inc. (“MVB Bank” or the “Bank”) finished the second quarter with strong capital ratios. As of June 30, 2021, the Bank’s Community Bank Leverage Ratio was 11.0%. The Company’s tangible common equity to tangible assets was 8.9% as of June 30, 2021.
    • As a result of this strong capital position, the Company increased the second quarterly dividend in 2021 to $0.12 per share, an increase of 20% compared to the previous quarter’s dividend. This dividend was payable on June 15, 2021 to shareholders of record at the close of business on June 1, 2021.
    • In July, MVB completed the sale of four banking centers in Southern West Virginia. This transaction included deposit balances of approximately $167 million and loan balances of $55 million. MVB will record a pre-tax gain of approximately $10 million on the sale, equating to a projected increase of 3% to TBV, in the third quarter of 2021.
  • Improving credit quality, recovering market conditions and growing economic confidence drive reserve release
    • The release of allowance for loan losses totaled $1.5 million for the quarter ended June 30, 2021, compared to provision for loan losses of $0.6 million and $6.6 million for the quarters ended March 31, 2021 and June 30, 2020, respectively.
    • Allowance for loan losses to total loans was 1.5% as of June 30, 2021, a decrease of 8 basis points from March 31, 2021 and an increase of 28 basis points from June 30, 2020. Excluding PPP loans of $207.3 million, allowance for loan losses to total loans was 1.7% as of June 30, 2021.
    • There were no net charge-offs for the quarter ended June 30, 2021, a decrease of $0.5 million compared to the quarter ended March 31, 2021 and a decrease of $0.3 million compared to the quarter ended June 30, 2020.
  • MVB completes the acquisition of Trabian Technology, Inc. (“Trabian”) and launches MVB Edge Ventures (“Edge Ventures”)
    • In April, the Company acquired a majority interest in Trabian, a leading software development firm servicing financial institutions and Fintech companies. MVB’s investment allowed Trabian to add 21 new team members to support their continued revenue growth and increased technology contribution to MVB’s Fintech initiatives.
    • In June, the Bank announced the formation of Edge Ventures, a wholly-owned subsidiary. Edge Ventures was created as a management company providing oversight, alignment and structure for MVB’s Fintech companies and allocates resources to help incubate venture businesses and technologies acquired and developed by MVB.

MANAGEMENT OVERVIEW

Throughout 2021, Team MVB continued to differentiate itself by generating growth in loans, including loans of branches held-for-sale, of $57.5 million, or 3%, from March 31, 2021, and $257.2 million, or 17%, from June 30, 2020. This loan growth will enhance future profitability and was funded by the sustained and robust growth in NIB deposits of $95.4 million, or 11%, from March 31, 2021, and $404.1 million, or 76%, from June 30, 2020. With NIB deposits as a percentage of total deposits up to 41.8% as of June 30, 2021, the Company’s strategy to evolve its deposit mix by replacing high-cost deposits with NIB deposits has proved to be successful and viable long-term. The Company generated net income of $9.2 million for the second quarter.

“MVB continues to build a best-in-class deposit funding base. In the second quarter, we achieved a huge milestone with NIB deposits now representing nearly 42% of total deposits. This bodes well for our future in a potentially rising rate environment. Our loan growth and loan quality are also exceeding expectations,” said Larry F. Mazza, President and CEO, MVB Financial. “We are seeing tangible progress in our various Fintech initiatives and continue to heavily invest in the build-out of that business, putting more ‘tech’ in our ‘fin’ by closing on the Trabian acquisition, more than doubling the size of the Trabian software development team and launching MVB Edge Ventures during the second quarter of 2021.”

LOANS

Loans, including loans of branches held-for-sale totaling $54.5 million, were $1.75 billion as of June 30, 2021, an increase of $57.5 million, or 3%, from March 31, 2021, and an increase of $257.2 million, or 17%, from June 30, 2020. Included in loans are PPP loans totaling $207.3 million at June 30, 2021, an increase of $16.7 million, or 9%, from March 31, 2021, and $117.5 million, or 131%, from June 30, 2020. The increase in loans was driven by increased commercial lending production, including the impact of the addition of a Small Business Administration (“SBA”) lending team during the fourth quarter of 2020. During the quarter ended June 30, 2021, the SBA team originated 7(a) loans totaling $12.3 million and sold 7(a) loans totaling $9.8 million for a gain on sale of $1.3 million.

The tax-equivalent yield on loans, including PPP loans, was 4.31% for the quarter ended June 30, 2021, a decrease of seven basis points from the quarter ended March 31, 2021 and a decrease of 43 basis points from the quarter ended June 30, 2020. These decreases were primarily the result of a decrease in the yield on commercial loans.

DEPOSITS

Deposits totaled $2.23 billion as of June 30, 2021, an increase of $12.6 million, or 1%, from March 31, 2021 and an increase of $365.2 million, or 20%, from June 30, 2020. NIB deposits totaled $932.7 million as of June 30, 2021, an increase of $95.4 million, or 11%, from March 31, 2021 and an increase of $404.1 million, or 76%, from June 30, 2020.

NET INTEREST INCOME

Net interest income for the quarter ended June 30, 2021 was $19.1 million, an increase of $1.6 million, or 9%, from the quarter ended March 31, 2021 and an increase of $0.6 million, or 3%, from the quarter ended June 30, 2020. On a fully tax-equivalent basis, net interest margin for the quarter ended June 30, 2021 was 3.24%, a decrease of two basis points versus the quarter ended March 31, 2021 and a decrease of 54 basis points versus the quarter ended June 30, 2020. Please see the table on page 16 for a reconciliation between net interest margin and net interest margin on a fully tax-equivalent basis, a non-GAAP measure. Net interest margin was primarily impacted by excess liquidity and PPP loans. For the quarter ended June 30, 2021, the excess liquidity from increased cash balances accounted for 11 basis points of the decrease and the PPP loans accounted for 21 basis points of the decrease. The tax-equivalent adjustments are added to net interest income and were $0.4 million for the quarter ended June 30, 2021, $0.4 million for the quarter ended March 31, 2021 and $0.3 million for the quarter ended June 30, 2020. Excluding the impact from the April 2020 acquisition of The First State Bank (“First State”), the fully-tax equivalent net interest margin for the quarter ended June 30, 2021 would have decreased 20 basis points.

Interest income increased $1.8 million, or 9%, compared to the quarter ended March 31, 2021 and decreased $0.9 million, or 4%, compared to the quarter ended June 30, 2020. The increase was primarily driven by growth in the interest income on commercial loans. The tax-equivalent yield on commercial loans decreased five basis points due to the average balance of commercial loans outpacing the increase in interest income compared to the quarter ended March 31, 2021. The 43-basis point decrease in the yield on commercial loans and the 118-basis point decrease in the yield on investments drove the 90-basis point decrease in the tax-equivalent yield on earning assets compared to the quarter ended June 30, 2020.

Interest expense increased $0.2 million, or 14%, compared to the quarter ended March 31, 2021 and decreased $1.5 million, or 46%, compared to the quarter ended June 30, 2020. The one-basis point decrease in the cost of interest-bearing liabilities compared to the quarter ended March 31, 2021 was driven by a 17-basis point decrease in the cost of certificates of deposit, while the overall cost of deposits remained flat. The 46-basis point decrease in the cost of interest-bearing liabilities compared to the quarter ended June 30, 2020 was driven by a 55-basis point decrease in the cost of deposits.

Despite a decrease in the Company's average NIB balances of $11.6 million from the quarter ended March 31, 2021, the Company maintained a 17-basis point favorable spread on the tax-equivalent net interest margin for the quarter ended June 30, 2021, compared to a 20-basis point favorable spread for the quarter ended March 31, 2021. An increase in the Company’s average NIB balances of $355.8 million from the quarter ended June 30, 2020 helped to maintain a 17-basis point favorable spread on the tax-equivalent net interest margin for the quarter ended June 30, 2021 compared to a 27-basis point favorable spread for the same period in 2020.

ASSET QUALITY

The release of allowance for loan losses totaled $1.5 million for the quarter ended June 30, 2021, as compared to provision for loan losses of $0.6 million and $6.6 million for the quarters ended March 31, 2021 and June 30, 2020, respectively. The release of allowance for loan losses was primarily the result of improvement in the qualitative adjustment factors within the allowance methodology. In addition, changes to the outstanding balances of the loan portfolios, changes to the level of recognized charge-offs and changes in the resulting historical loss rates, and adjustments to the risk grading of loans within the portfolio were all contributing factors in the ultimate change from provision for loan losses to the release of allowance for loan losses. Nonperforming loans totaled $15.5 million, or 0.9% of total loans, as of June 30, 2021, compared to 0.7% of total loans as of March 31, 2021 and compared to 0.9% of total loans as of June 30, 2020. Criticized loans as a percentage of total loans were 7.3%, a decrease of 70 basis points, or 9%, from March 31, 2021, and an increase of 46 basis points, or 7%, from June 30, 2020.

NONINTEREST INCOME

Noninterest income totaled $13.6 million for the quarter ended June 30, 2021, an increase of $1.2 million, or 10%, from the quarter ended March 31, 2021 and a decrease of $31.9 million, or 70%, from the quarter ended June 30, 2020.

The $1.2 million increase in noninterest income from the quarter ended March 31, 2021 was due to increases in the gain on sale of loans of $1.1 million, in compliance consulting income of $0.6 million, in the gain on sale of available-for-sale securities of $0.6 million, in payment card and service charge income of $0.4 million, and in the holding gain on equity securities of $0.2 million. These increases were partially offset by a decrease in equity method investment income related to the Company’s investment in Intercoastal Mortgage Company, LLC (“ICM”) of $1.9 million.

The $31.9 million decrease in noninterest income from the quarter ended June 30, 2020 was due to decreases in mortgage-related income of $28.4 million from the transition to the equity method from the mortgage combination with ICM that occurred in July 2020 and the gains on acquisition and divestiture activity of $14.3 million from the Company’s strategic transactions in the second quarter of 2020, including $9.6 million from the sale of Eastern Panhandle, WV banking centers and $4.7 million from the bargain purchase gain from the acquisition of First State. These decreases were partially offset by increases in equity method investment income related to the Company’s investment in ICM of $4.5 million, payment card and service charge income of $1.4 million, gain on sale of loans of $1.4 million, gain on sale of available-for-sale securities of $1.2 million, compliance consulting income of $0.9 million and holding gain on equity securities of $0.7 million.

The Company expects continued growth in payment card and service charge income as a result of several sponsoring agreements and new products and services as a result of recent investments in Fintech capabilities.

NONINTEREST EXPENSE

Noninterest expense totaled $23.4 million for the quarter ended June 30, 2021, an increase of $4.3 million, or 22%, from the quarter ended March 31, 2021 and a decrease of $9.9 million, or 30%, from the quarter ended June 30, 2020.

The $4.3 million increase in noninterest expense from the quarter ended March 31, 2021 was due to increases in salaries and employee benefits of $1.8 million, in professional fees of $0.7 million, in data processing and communications expense of $0.5 million, and in travel, entertainment, dues and subscriptions of $0.3 million. The increase in salaries and employee benefits was driven by increases of $0.8 million at Chartwell Compliance, $0.5 million at Trabian, $0.2 million at the Bank, and $0.2 million at the Holding Company. These increases were due to 53 net new hires to further build-out the Fintech vertical at the Bank, Chartwell Compliance and the shared services at the Holding Company, as well as annual salary increases for existing employees during the second quarter of 2020.

The $9.9 million decrease in noninterest expense from the quarter ended June 30, 2020 was due to decreases in salaries and employee benefits of $9.0 million, in mortgage processing expense of $0.9 million and in professional fees of $0.5 million. The decrease in salaries and employee benefits was primarily due to the mortgage combination with ICM in July 2020.

About MVB Financial Corp.

MVB Financial Corp. (“MVB Financial” or “MVB”), the holding company of MVB Bank, Inc., is publicly traded on The Nasdaq Capital Market® (“Nasdaq”) under the ticker “MVBF.”

MVB is a financial holding company headquartered in Fairmont, WV. Through its subsidiary, MVB Bank, Inc., and the bank’s subsidiaries, the Company provides financial services to individuals and corporate clients in the Mid-Atlantic region and beyond.

Nasdaq is a leading global provider of trading, clearing, exchange technology, listing, information and public company services.

For more information about MVB, please visit ir.mvbbanking.com.

Forward-looking Statements

MVB Financial has made forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, in this press release that are intended to be covered by the protections provided under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations about the future and are subject to risks and uncertainties. Forward-looking statements include, without limitation, information concerning possible or assumed future results of operations of the Company and its subsidiaries. Forward-looking statements can be identified by the use of words such as “may,” “could,” “should,” “would,” “will,” “plans,” “believes,” “estimates,” “expects,” “anticipates,” “intends,” “continues” or the negative of those terms or similar expressions. Note that many factors could affect the future financial results of the Company and its subsidiaries, both individually and collectively, and could cause those results to differ materially from those expressed in forward-looking statements. Therefore, undue reliance should not be placed upon any forward-looking statements. Those factors include but are not limited to: market, economic, operational, liquidity and credit risk; changes in market interest rates; inability to achieve anticipated synergies and successfully integrate recent mergers and acquisitions; inability to successfully execute business plans, including strategies related to investments in financial technology companies; competition; length and severity of the COVID-19 pandemic and its impact on the Company’s business and financial condition; changes in economic, business and political conditions; changes in demand for loan products and deposit flow; operational risks and risk management failures; and government regulation and supervision. Additional factors that may cause actual results to differ materially from those described in the forward-looking statements can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, as well as its other filings with the Securities and Exchange Commission (“SEC”), which are available on the SEC’s website at www.sec.gov. Except as required by law, the Company disclaims any obligation to update, revise or correct any forward-looking statements.

Accounting standards require the consideration of subsequent events occurring after the balance sheet date for matters that require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s financial statements when filed with the SEC. Accordingly, the consolidated financial information in this announcement is subject to change.

Questions or comments concerning this Earnings Release should be directed to:

MVB Financial Corp.
Donald T. Robinson, Executive Vice President and CFO
(304) 598-3500
drobinson@mvbbanking.com

MVB Financial Corp.

Financial Highlights

Consolidated Statements of Income

(Unaudited) (Dollars in thousands, except per share data)

 

 

 

Quarterly

 

Year-to-Date

 

 

2021

 

2021

 

2020

 

2021

 

2020

 

 

Second Quarter

 

First Quarter

 

Second Quarter

 

 

Interest income

 

$

20,833

 

 

$

19,063

 

 

$

21,774

 

 

$

39,896

 

 

$

42,473

 

Interest expense

 

1,778

 

 

1,558

 

 

3,316

 

 

3,336

 

 

7,844

 

Net interest income

 

19,055

 

 

17,505

 

 

18,458

 

 

36,560

 

 

34,629

 

Provision (release of allowance) for loan losses

 

(1,540)

 

 

618

 

 

6,596

 

 

(922)

 

 

7,734

 

Net interest income after provision (release of allowance) for loan losses

 

20,595

 

 

16,887

 

 

11,862

 

 

37,482

 

 

26,895

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

 

13,644

 

 

12,458

 

 

45,513

 

 

26,102

 

 

56,363

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

13,661

 

 

11,911

 

 

22,659

 

 

25,572

 

 

38,841

 

Other expense

 

9,742

 

 

7,207

 

 

10,674

 

 

16,949

 

 

19,148

 

Total noninterest expenses

 

23,403

 

 

19,118

 

 

33,333

 

 

42,521

 

 

57,989

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

10,836

 

 

10,227

 

 

24,042

 

 

21,063

 

 

25,269

 

Income tax expense

 

1,673

 

 

2,169

 

 

6,008

 

 

3,842

 

 

6,187

 

Net income before noncontrolling interest

 

9,163

 

 

8,058

 

 

18,034

 

 

17,221

 

 

19,082

 

Net loss attributable to noncontrolling interest

 

84

 

 

27

 

 

 

 

111

 

 

 

Net income attributable to parent

 

9,247

 

 

8,085

 

 

18,034

 

 

17,332

 

 

19,082

 

Preferred dividends

 

 

 

35

 

 

115

 

 

35

 

 

229

 

Net income available to common shareholders

 

$

9,247

 

 

$

8,050

 

 

$

17,919

 

 

$

17,297

 

 

$

18,853

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share - basic

 

$

0.79

 

 

$

0.70

 

 

$

1.50

 

 

$

1.49

 

 

$

1.58

 

Earnings per share - diluted

 

$

0.73

 

 

$

0.66

 

 

$

1.49

 

 

$

1.39

 

 

$

1.55

 

Condensed Consolidated Balance Sheets

(Unaudited) (Dollars in thousands)

 

 

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

Cash and cash equivalents

 

$

332,771

 

 

$

339,616

 

 

$

78,854

 

Certificates of deposit with banks

 

11,803

 

 

11,803

 

 

13,046

 

Securities available-for-sale, at fair value

 

450,772

 

 

423,122

 

 

220,699

 

Equity securities

 

32,215

 

 

28,200

 

 

19,464

 

Loans held-for-sale

 

 

 

 

 

242,089

 

Loans receivable

 

1,697,326

 

 

1,694,385

 

 

1,494,672

 

Less: Allowance for loan losses

 

(24,882)

 

 

(26,214)

 

 

(17,742)

 

Loans receivable, net

 

1,672,444

 

 

1,668,171

 

 

1,476,930

 

Premises and equipment, net

 

21,033

 

 

24,665

 

 

24,586

 

Goodwill

 

4,119

 

 

2,350

 

 

19,232

 

Assets of branches held-for-sale

 

59,488

 

 

 

 

 

Other assets

 

149,895

 

 

148,162

 

 

120,257

 

Total assets

 

$

2,734,540

 

 

$

2,646,089

 

 

$

2,215,157

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

$

932,660

 

 

$

837,221

 

 

$

528,527

 

Interest-bearing deposits

 

1,296,515

 

 

1,379,332

 

 

1,335,436

 

Liabilities of branches held-for-sale

 

165,750

 

 

 

 

 

Borrowed funds

 

100

 

 

102,185

 

 

36,610

 

Other liabilities

 

90,115

 

 

90,668

 

 

86,084

 

Stockholders' equity, including noncontrolling interest

 

249,400

 

 

236,683

 

 

228,500

 

Total liabilities and stockholders' equity

 

$

2,734,540

 

 

$

2,646,089

 

 

$

2,215,157

 

Reportable Segments

(Unaudited)

 

Three Months Ended June 30, 2021

 

CoRe Banking

 

Mortgage
Banking

 

Financial
Holding
Company

 

Intercompany
Eliminations

 

Consolidated

(Dollars in thousands)

 

 

 

 

 

Interest income

 

$

20,736

 

 

$

98

 

 

$

 

 

$

(1)

 

 

$

20,833

 

Interest expense

 

1,290

 

 

 

 

490

 

 

(2)

 

 

1,778

 

Net interest income (loss)

 

19,446

 

 

98

 

 

(490)

 

 

1

 

 

19,055

 

Release of allowance for loan losses

 

(1,540)

 

 

 

 

 

 

 

 

(1,540)

 

Net interest income (loss) after release of allowance for loan losses

 

20,986

 

 

98

 

 

(490)

 

 

1

 

 

20,595

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

 

9,986

 

 

4,546

 

 

2,309

 

 

(3,197)

 

 

13,644

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest Expenses:

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

10,384

 

 

 

 

3,277

 

 

 

 

13,661

 

Other expense

 

11,578

 

 

23

 

 

1,337

 

 

(3,196)

 

 

9,742

 

Total noninterest expenses

 

21,962

 

 

23

 

 

4,614

 

 

(3,196)

 

 

23,403

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

9,010

 

 

4,621

 

 

(2,795)

 

 

 

 

10,836

 

Income tax expense (benefit)

 

1,168

 

 

1,120

 

 

(615)

 

 

 

 

1,673

 

Net income (loss) before noncontrolling interest

 

7,842

 

 

3,501

 

 

(2,180)

 

 

 

 

9,163

 

Net loss attributable to noncontrolling interest

 

84

 

 

 

 

 

 

 

 

84

 

Net income (loss) attributable to parent

 

7,926

 

 

3,501

 

 

(2,180)

 

 

 

 

9,247

 

Preferred stock dividends

 

 

 

 

 

 

 

 

 

 

Net income (loss) available to common shareholders

 

$

7,926

 

 

$

3,501

 

 

$

(2,180)

 

 

$

 

 

$

9,247

 

Three Months Ended March 31, 2021

 

CoRe Banking

 

Mortgage
Banking

 

Financial
Holding
Company

 

Intercompany
Eliminations

 

Consolidated

(Dollars in thousands)

 

 

 

 

 

Interest income

 

$

18,959

 

 

$

104

 

 

$

1

 

 

$

(1)

 

 

$

19,063

 

Interest expense

 

1,092

 

 

 

 

466

 

 

 

 

1,558

 

Net interest income (loss)

 

17,867

 

 

104

 

 

(465)

 

 

(1)

 

 

17,505

 

Provision (release of allowance) for loan losses

 

620

 

 

(2)

 

 

 

 

 

 

618

 

Net interest income (loss) after provision (release of allowance) for loan losses

 

17,247

 

 

106

 

 

(465)

 

 

(1)

 

 

16,887

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

 

6,437

 

 

6,407

 

 

1,581

 

 

(1,967)

 

 

12,458

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest Expenses:

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

8,842

 

 

 

 

3,069

 

 

 

 

11,911

 

Other expense

 

8,029

 

 

63

 

 

1,083

 

 

(1,968)

 

 

7,207

 

Total noninterest expenses

 

16,871

 

 

63

 

 

4,152

 

 

(1,968)

 

 

19,118

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

6,813

 

 

6,450

 

 

(3,036)

 

 

 

 

10,227

 

Income tax expense (benefit)

 

1,149

 

 

1,564

 

 

(544)

 

 

 

 

2,169

 

Net income (loss) before noncontrolling interest

 

5,664

 

 

4,886

 

 

(2,492)

 

 

 

 

8,058

 

Net loss attributable to noncontrolling interest

 

27

 

 

 

 

 

 

 

 

27

 

Net income (loss) attributable to parent

 

5,691

 

 

4,886

 

 

(2,492)

 

 

 

 

8,085

 

Preferred stock dividends

 

 

 

 

 

35

 

 

 

 

35

 

Net income (loss) available to common shareholders

 

$

5,691

 

 

$

4,886

 

 

$

(2,527)

 

 

$

 

 

$

8,050

 

Three Months Ended June 30, 2020

 

CoRe Banking

 

Mortgage
Banking

 

Financial
Holding
Company

 

Intercompany
Eliminations

 

Consolidated

(Dollars in thousands)

 

 

 

 

 

Interest income

 

$

19,182

 

 

$

3,538

 

 

$

1

 

 

$

(947)

 

 

$

21,774

 

Interest expense

 

3,027

 

 

1,517

 

 

23

 

 

(1,251)

 

 

3,316

 

Net interest income (loss)

 

16,155

 

 

2,021

 

 

(22)

 

 

304

 

 

18,458

 

Provision (release of allowance) for loan losses

 

6,598

 

 

(2)

 

 

 

 

 

 

6,596

 

Net interest income (loss) after provision (release of allowance) for loan losses

 

9,557

 

 

2,023

 

 

(22)

 

 

304

 

 

11,862

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

 

17,832

 

 

28,562

 

 

1,679

 

 

(2,560)

 

 

45,513

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest Expenses:

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

6,170

 

 

13,584

 

 

2,905

 

 

 

 

22,659

 

Other expense

 

9,124

 

 

2,315

 

 

1,491

 

 

(2,256)

 

 

10,674

 

Total noninterest expenses

 

15,294

 

 

15,899

 

 

4,396

 

 

(2,256)

 

 

33,333

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

12,095

 

 

14,686

 

 

(2,739)

 

 

 

 

24,042

 

Income tax expense (benefit)

 

2,880

 

 

3,800

 

 

(672)

 

 

 

 

6,008

 

Net income (loss)

 

9,215

 

 

10,886

 

 

(2,067)

 

 

 

 

18,034

 

Preferred stock dividends

 

 

 

 

 

115

 

 

 

 

115

 

Net income (loss) available to common shareholders

 

$

9,215

 

 

$

10,886

 

 

$

(2,182)

 

 

$

 

 

$

17,919

 

Six Months Ended June 30, 2021

 

CoRe Banking

 

Mortgage
Banking

 

Financial
Holding
Company

 

Intercompany
Eliminations

 

Consolidated

(Dollars in thousands)

 

 

 

 

 

Interest income

 

$

39,695

 

 

$

202

 

 

$

1

 

 

$

(2)

 

 

$

39,896

 

Interest expense

 

2,382

 

 

 

 

956

 

 

(2)

 

 

3,336

 

Net interest income (loss)

 

37,313

 

 

202

 

 

(955)

 

 

 

 

36,560

 

Release of allowance for loan losses

 

(920)

 

 

(2)

 

 

 

 

 

 

(922)

 

Net interest income (loss) after release of allowance for loan losses

 

38,233

 

 

204

 

 

(955)

 

 

 

 

37,482

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

 

16,423

 

 

10,953

 

 

3,890

 

 

(5,164)

 

 

26,102

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest Expenses:

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

19,226

 

 

 

 

6,346

 

 

 

 

25,572

 

Other expense

 

19,607

 

 

86

 

 

2,420

 

 

(5,164)

 

 

16,949

 

Total noninterest expenses

 

38,833

 

 

86

 

 

8,766

 

 

(5,164)

 

 

42,521

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

15,823

 

 

11,071

 

 

(5,831)

 

 

 

 

21,063

 

Income tax expense (benefit)

 

2,317

 

 

2,684

 

 

(1,159)

 

 

 

 

3,842

 

Net income (loss) before noncontrolling interest

 

13,506

 

 

8,387

 

 

(4,672)

 

 

 

 

17,221

 

Net loss attributable to noncontrolling interest

 

111

 

 

 

 

 

 

 

 

111

 

Net income (loss) attributable to parent

 

13,617

 

 

8,387

 

 

(4,672)

 

 

 

 

17,332

 

Preferred stock dividends

 

 

 

 

 

35

 

 

 

 

35

 

Net income (loss) available to common shareholders

 

$

13,617

 

 

$

8,387

 

 

$

(4,707)

 

 

$

 

 

$

17,297

 

Six Months Ended June 30, 2020

 

CoRe Banking

 

Mortgage
Banking

 

Financial
Holding
Company

 

Intercompany
Eliminations

 

Consolidated

(Dollars in thousands)

 

 

 

 

 

Interest income

 

$

37,956

 

 

$

5,956

 

 

$

2

 

 

$

(1,441)

 

 

$

42,473

 

Interest expense

 

6,865

 

 

2,904

 

 

58

 

 

(1,983)

 

 

7,844

 

Net interest income (loss)

 

31,091

 

 

3,052

 

 

(56)

 

 

542

 

 

34,629

 

Provision for loan losses

 

7,730

 

 

4

 

 

 

 

 

 

7,734

 

Net interest income (loss) after provision for loan losses

 

23,361

 

 

3,048

 

 

(56)

 

 

542

 

 

26,895

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest income

 

21,288

 

 

36,347

 

 

3,183

 

 

(4,455)

 

 

56,363

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest Expenses:

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

12,036

 

 

21,468

 

 

5,337

 

 

 

 

38,841

 

Other expense

 

15,783

 

 

4,712

 

 

2,566

 

 

(3,913)

 

 

19,148

 

Total noninterest expenses

 

27,819

 

 

26,180

 

 

7,903

 

 

(3,913)

 

 

57,989

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

16,830

 

 

13,215

 

 

(4,776)

 

 

 

 

25,269

 

Income tax expense (benefit)

 

3,892

 

 

3,451

 

 

(1,156)

 

 

 

 

6,187

 

Net income (loss)

 

12,938

 

 

9,764

 

 

(3,620)

 

 

 

 

19,082

 

Preferred stock dividends

 

 

 

 

 

229

 

 

 

 

229

 

Net income (loss) available to common shareholders

 

$

12,938

 

 

$

9,764

 

 

$

(3,849)

 

 

$

 

 

$

18,853

 

Average Balances and Interest Rates

(Unaudited) (Dollars in thousands)

 

 

 

Three Months Ended

 

Three Months Ended

 

Three Months Ended

 

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

 

 

Average
Balance

 

Interest
Income/
Expense

 

Yield/
Cost

 

Average
Balance

 

Interest
Income/
Expense

 

Yield/
Cost

 

Average
Balance

 

Interest
Income/
Expense

 

Yield/
Cost

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing balances with banks

 

$

178,792

 

 

$

40

 

 

0.09

%

 

$

259,491

 

 

$

65

 

 

0.10

%

 

$

44,095

 

 

$

16

 

 

0.15

%

CDs with banks

 

11,803

 

 

58

 

 

1.97

 

 

11,803

 

 

57

 

 

1.96

 

 

12,811

 

 

64

 

 

2.00

 

Investment securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

254,536

 

 

625

 

 

0.98

 

 

172,902

 

 

631

 

 

1.48

 

 

96,760

 

 

477

 

 

1.98

 

Tax-exempt 2

 

207,830

 

 

1,640

 

 

3.17

 

 

212,488

 

 

1,714

 

 

3.27

 

 

123,806

 

 

1,248

 

 

4.04

 

Loans and loans held-for-sale: 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial 3

 

1,416,669

 

 

15,884

 

 

4.50

 

 

1,262,444

 

 

14,171

 

 

4.55

 

 

1,165,649

 

 

14,319

 

 

4.93

 

Tax-exempt 2

 

6,905

 

 

78

 

 

4.53

 

 

7,205

 

 

81

 

 

4.56

 

 

8,879

 

 

104

 

 

4.69

 

Real estate

 

320,528

 

 

2,747

 

 

3.44

 

 

293,076

 

 

2,684

 

 

3.71

 

 

532,386

 

 

5,701

 

 

4.30

 

Consumer

 

6,550

 

 

122

 

 

7.47

 

 

7,696

 

 

37

 

 

1.95

 

 

6,332

 

 

129

 

 

8.17

 

Total loans

 

1,750,652

 

 

18,831

 

 

4.31

 

 

1,570,421

 

 

16,973

 

 

4.38

 

 

1,713,246

 

 

20,253

 

 

4.74

 

Total earning assets

 

2,403,613

 

 

21,194

 

 

3.54

 

 

2,227,105

 

 

19,440

 

 

3.54

 

 

1,990,718

 

 

22,058

 

 

4.44

 

Less: Allowance for loan losses

 

(26,625)

 

 

 

 

 

 

(26,170)

 

 

 

 

 

 

(14,253)

 

 

 

 

 

Cash and due from banks

 

22,141

 

 

 

 

 

 

20,951

 

 

 

 

 

 

34,449

 

 

 

 

 

Other assets

 

193,165

 

 

 

 

 

 

209,995

 

 

 

 

 

 

179,806

 

 

 

 

 

Total assets

 

$

2,592,294

 

 

 

 

 

 

$

2,431,881

 

 

 

 

 

 

$

2,190,720

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW

 

$

716,924

 

 

$

643

 

 

0.36

%

 

$

518,937

 

 

$

344

 

 

0.27

%

 

$

367,448

 

 

$

775

 

 

0.85

%

Money market checking

 

466,091

 

 

221

 

 

0.19

 

 

487,281

 

 

231

 

 

0.19

 

 

429,708

 

 

564

 

 

0.53

 

Savings

 

52,992

 

 

 

 

 

 

39,668

 

 

6

 

 

 

 

41,485

 

 

8

 

 

0.08

 

IRAs

 

12,358

 

 

40

 

 

1.30

 

 

12,693

 

 

42

 

 

1.34

 

 

12,408

 

 

47

 

 

1.52

 

CDs

 

156,507

 

 

332

 

 

0.85

 

 

168,951

 

 

425

 

 

1.02

 

 

495,519

 

 

1,642

 

 

1.33

 

Repurchase agreements and federal funds sold

 

10,833

 

 

3

 

 

0.11

 

 

10,249

 

 

3

 

 

0.12

 

 

9,682

 

 

5

 

 

0.21

 

FHLB and other borrowings

 

55,402

 

 

49

 

 

0.35

 

 

46,349

 

 

41

 

 

0.36

 

 

76,739

 

 

252

 

 

1.32

 

Subordinated debt

 

43,462

 

 

490

 

 

4.52

 

 

43,425

 

 

466

 

 

4.35

 

 

4,124

 

 

23

 

 

2.24

 

Total interest-bearing liabilities

 

1,514,569

 

 

1,778

 

 

0.47

 

 

1,327,553

 

 

1,558

 

 

0.48

 

 

1,437,113

 

 

3,316

 

 

0.93

 

Noninterest-bearing demand deposits

 

810,298

 

 

 

 

 

 

821,923

 

 

 

 

 

 

454,486

 

 

 

 

 

Other liabilities

 

28,688

 

 

 

 

 

 

45,311

 

 

 

 

 

 

79,826

 

 

 

 

 

Total liabilities

 

2,353,555

 

 

 

 

 

 

2,194,787

 

 

 

 

 

 

1,971,425

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

 

 

 

 

 

 

2,349

 

 

 

 

 

 

7,334

 

 

 

 

 

Common stock

 

12,487

 

 

 

 

 

 

12,378

 

 

 

 

 

 

12,030

 

 

 

 

 

Paid-in capital

 

141,782

 

 

 

 

 

 

136,864

 

 

 

 

 

 

123,351

 

 

 

 

 

Treasury stock

 

(16,741)

 

 

 

 

 

 

(16,741)

 

 

 

 

 

 

(1,437)

 

 

 

 

 

Retained earnings

 

98,413

 

 

 

 

 

 

100,268

 

 

 

 

 

 

79,820

 

 

 

 

 

Accumulated other comprehensive income

 

2,194

 

 

 

 

 

 

1,971

 

 

 

 

 

 

(1,803)

 

 

 

 

 

Total stockholders’ equity attributable to parent

 

238,135

 

 

 

 

 

 

237,089

 

 

 

 

 

 

219,295

 

 

 

 

 

Noncontrolling interest

 

604

 

 

 

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

238,739

 

 

 

 

 

 

237,094

 

 

 

 

 

 

219,295

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

2,592,294

 

 

 

 

 

 

$

2,431,881

 

 

 

 

 

 

$

2,190,720

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest spread (tax-equivalent)

 

 

 

 

 

3.07

 

 

 

 

 

 

3.06

 

 

 

 

 

 

3.51

 

Net interest income and margin (tax-equivalent) 2

 

$

19,416

 

 

3.24

%

 

 

 

$

17,882

 

 

3.26

%

 

 

 

$

18,742

 

 

3.78

%

Less: Tax-equivalent adjustments

 

 

 

$

(361)

 

 

 

 

 

 

$

(377)

 

 

 

 

 

 

$

(284)

 

 

 

Net interest spread

 

 

 

 

 

3.01

%

 

 

 

 

 

3.00

%

 

 

 

 

 

3.46

%

Net interest income and margin

 

 

 

$

19,055

 

 

3.18

%

 

 

 

$

17,505

 

 

3.19

%

 

 

 

$

18,458

 

 

3.72

%

1

 

Non-accrual loans are included in total loan balances, lowering the effective yield for the portfolio in the aggregate.

2

 

In order to make pre-tax income and resultant yields on tax-exempt loans and investment securities comparable to those on taxable loans and investment securities, a tax-equivalent adjustment has been computed using a Federal tax rate of 21% for the periods presented, which is a non-GAAP financial measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure following this table.

3

 

The Company’s PPP loans totaling $207.3 million, $190.6 million, and $89.8 million are included in this amount for the three months ended June 30, 2021, March 31, 2021, and June 30, 2020, respectively.

 

 

Six Months Ended

Six Months Ended

 

 

June 30, 2021

June 30, 2020

 

 

Average
Balance

 

Interest
Income/
Expense

 

Yield/
Cost

Average
Balance

 

Interest
Income/
Expense

 

Yield/
Cost

Assets

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing balances with banks

 

$

218,919

 

 

$

105

 

 

0.10

%

$

28,869

 

 

$

65

 

 

0.45

%

CDs with banks

 

11,803

 

 

115

 

 

1.96

 

12,680

 

 

126

 

 

1.99

 

Investment securities:

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

213,944

 

 

1,256

 

 

1.18

 

104,932

 

 

1,143

 

 

2.18

 

Tax-exempt 2

 

210,146

 

 

3,354

 

 

3.22

 

116,997

 

 

2,358

 

 

4.04

 

Loans and loans held-for-sale: 1

 

 

 

 

 

 

 

 

 

 

 

Commercial 3

 

1,339,983

 

 

30,055

 

 

4.52

 

1,127,430

 

 

28,182

 

 

5.01

 

Tax-exempt 2

 

7,055

 

 

159

 

 

4.54

 

10,319

 

 

238

 

 

4.63

 

Real estate

 

306,878

 

 

5,430

 

 

3.57

 

481,053

 

 

10,655

 

 

4.44

 

Consumer

 

7,120

 

 

160

 

 

4.53

 

6,903

 

 

251

 

 

7.29

 

Total loans

 

1,661,036

 

 

35,804

 

 

4.35

 

1,625,705

 

 

39,326

 

 

4.85

 

Total earning assets

 

2,315,848

 

 

40,634

 

 

3.54

 

1,889,183

 

 

43,018

 

 

4.57

 

Less: Allowance for loan losses

 

(26,399)

 

 

 

 

 

(12,809)

 

 

 

 

 

Cash and due from banks

 

21,549

 

 

 

 

 

27,608

 

 

 

 

 

Other assets

 

201,533

 

 

 

 

 

165,387

 

 

 

 

 

Total assets

 

$

2,512,531

 

 

 

 

 

$

2,069,369

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

NOW

 

$

618,478

 

 

$

987

 

 

0.32

%

$

387,455

 

 

$

1,573

 

 

0.81

%

Money market checking

 

476,628

 

 

452

 

 

0.19

 

430,942

 

 

2,017

 

 

0.94

 

Savings

 

46,366

 

 

5

 

 

0.02

 

40,527

 

 

9

 

 

0.04

 

IRAs

 

12,525

 

 

82

 

 

1.32

 

14,490

 

 

125

 

 

1.73

 

CDs

 

162,694

 

 

758

 

 

0.94

 

415,165

 

 

3,222

 

 

1.56

 

Repurchase agreements and federal funds sold

 

10,542

 

 

8

 

 

0.15

 

9,601

 

 

15

 

 

0.31

 

FHLB and other borrowings

 

50,901

 

 

88

 

 

0.35

 

96,335

 

 

825

 

 

1.72

 

Subordinated debt

 

43,444

 

 

956

 

 

4.44

 

4,124

 

 

58

 

 

2.82

 

Total interest-bearing liabilities

 

1,421,578

 

 

3,336

 

 

0.47

 

1,398,639

 

 

7,844

 

 

1.12

 

Noninterest-bearing demand deposits

 

816,078

 

 

 

 

 

391,872

 

 

 

 

 

Other liabilities

 

36,960

 

 

 

 

 

61,644

 

 

 

 

 

Total liabilities

 

2,274,616

 

 

 

 

 

1,852,155

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

1,168

 

 

 

 

 

7,334

 

 

 

 

 

Common stock

 

12,433

 

 

 

 

 

12,014

 

 

 

 

 

Paid-in capital

 

139,330

 

 

 

 

 

123,007

 

 

 

 

 

Treasury stock

 

(16,741)

 

 

 

 

 

(1,286)

 

 

 

 

 

Retained earnings

 

99,336

 

 

 

 

 

77,111

 

 

 

 

 

Accumulated other comprehensive income (loss)

 

2,083

 

 

 

 

 

(966)

 

 

 

 

 

Total stockholders’ equity attributable to parent

 

237,609

 

 

 

 

 

217,214

 

 

 

 

 

Noncontrolling interest

 

306

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

237,915

 

 

 

 

 

217,214

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

2,512,531

 

 

 

 

 

$

2,069,369

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest spread (tax-equivalent)

 

 

 

 

 

3.07

 

 

 

 

 

3.45

 

Net interest income and margin (tax-equivalent) 2

 

$

37,298

 

 

3.25

%

 

 

$

35,174

 

 

3.73

%

Less: Tax-equivalent adjustments

 

 

 

$

(738)

 

 

 

 

 

$

(545)

 

 

 

Net interest spread

 

 

 

 

 

3.00

%

 

 

 

 

3.38

%

Net interest income and margin

 

 

 

$

36,560

 

 

3.18

%

 

 

$

34,629

 

 

3.68

%

1

 

Non-accrual loans are included in total loan balances, lowering the effective yield for the portfolio in the aggregate.

2

 

In order to make pre-tax income and resultant yields on tax-exempt loans and investment securities comparable to those on taxable loans and investment securities, a tax-equivalent adjustment has been computed using a Federal tax rate of 21% for the periods presented, which is a non-GAAP financial measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure following this table.

3

 

The Company’s PPP loans totaling $207.3 million and $89.8 million are included in this amount for the six months ended June 30, 2021 and June 30, 2020, respectively.

The following table reconciles, for the periods shown below, net interest margin on a fully tax-equivalent basis:

 

 

Three Months Ended

 

Six Months Ended

(Dollars in thousands)

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

 

June 30, 2021

 

June 30, 2020

Net interest margin - U.S. GAAP basis

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

19,055

 

 

$

17,505

 

 

$

18,458

 

 

$

36,560

 

 

$

34,629

 

Average interest-earning assets

 

2,403,613

 

 

2,227,105

 

 

1,990,718

 

 

2,315,848

 

 

1,889,183

 

Net interest margin

 

3.18

%

 

3.19

%

 

3.72

%

 

3.18

%

 

3.68

%

 

 

 

 

 

 

 

 

 

 

 

Net interest margin - non-U.S. GAAP basis

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

19,055

 

 

$

17,505

 

 

$

18,458

 

 

$

36,560

 

 

$

34,629

 

Plus: Impact of fully tax-equivalent adjustment

 

361

 

 

377

 

 

284

 

 

738

 

 

545

 

Net interest income on a fully tax-equivalent basis

 

19,416

 

 

17,882

 

 

18,742

 

 

37,298

 

 

35,174

 

Average interest-earning assets

 

2,403,613

 

 

2,227,105

 

 

1,990,718

 

 

2,315,848

 

 

1,889,183

 

Net interest margin on a fully tax-equivalent basis

 

3.24

%

 

3.26

%

 

3.78

%

 

3.25

%

 

3.73

%

Selected Financial Data

(Unaudited) (Dollars in thousands, except per share data)

 

 

 

Quarterly

 

Year-to-Date

 

 

2021

 

2021

 

2020

 

2021

 

2020

 

 

Second Quarter

 

First Quarter

 

Second Quarter

 

 

Earnings and Per Share Data:

 

 

 

 

 

 

 

 

 

 

Net income

 

$

9,247

 

 

$

8,085

 

 

$

18,034

 

 

17,332

 

 

19,082

 

Net income available to common shareholders

 

$

9,247

 

 

$

8,050

 

 

$

17,919

 

 

17,297

 

 

18,853

 

Earnings per share - basic

 

$

0.79

 

 

$

0.70

 

 

$

1.50

 

 

$

1.49

 

 

$

1.58

 

Earnings per share - diluted

 

$

0.73

 

 

$

0.66

 

 

$

1.49

 

 

$

1.39

 

 

$

1.55

 

Cash dividends paid per common share

 

$

0.12

 

 

$

0.10

 

 

$

0.09

 

 

$

0.22

 

 

$

0.18

 

Book value per common share

 

$

21.12

 

 

$

20.38

 

 

$

18.48

 

 

$

21.12

 

 

$

18.48

 

Tangible book value per common share

 

$

20.54

 

 

$

19.98

 

 

$

16.65

 

 

$

20.54

 

 

$

16.65

 

Weighted-average shares outstanding - basic

 

11,639,237

 

 

11,530,279

 

 

11,954,813

 

 

11,585,059

 

 

11,948,790

 

Weighted-average shares outstanding - diluted

 

12,612,030

 

 

12,218,899

 

 

12,011,845

 

 

12,449,973

 

 

12,156,214

 

 

 

 

 

 

 

 

 

 

 

 

Performance Ratios:

 

 

 

 

 

 

 

 

 

 

Return on average assets 1

 

1.4

%

 

1.3

%

 

3.3

%

 

1.4

%

 

1.8

%

Return on average equity 1

 

15.5

%

 

13.6

%

 

32.9

%

 

14.6

%

 

17.6

%

Net interest margin 2 3

 

3.24

%

 

3.26

%

 

3.78

%

 

3.25

%

 

3.73

%

Efficiency ratio 4

 

71.6

%

 

63.8

%

 

52.1

%

 

67.9

%

 

63.7

%

Overhead ratio 1 5

 

3.6

%

 

3.1

%

 

6.1

%

 

3.4

%

 

5.6

%

Equity to assets

 

9.1

%

 

8.9

%

 

10.3

%

 

9.1

%

 

10.3

%

 

 

 

 

 

 

 

 

 

 

 

Asset Quality Data and Ratios:

 

 

 

 

 

 

 

 

 

 

Charge-offs

 

$

 

 

$

265

 

 

$

23

 

 

$

265

 

 

$

1,779

 

Recoveries

 

$

208

 

 

$

17

 

 

$

8

 

 

$

225

 

 

$

12

 

Net loan charge-offs to total loans 1 6

 

(0.1)

%

 

0.1

%

 

%

 

%

 

0.2

%

Allowance for loan losses

 

$

24,882

 

 

$

26,214

 

 

$

17,742

 

 

$

24,882

 

 

$

17,742

 

Allowance for loan losses to total loans 7

 

1.5

%

 

1.5

%

 

1.2

%

 

1.5

%

 

1.2

%

Nonperforming loans

 

$

15,501

 

 

$

11,577

 

 

$

14,061

 

 

$

15,501

 

 

$

14,061

 

Nonperforming loans to total loans

 

0.9

%

 

0.7

%

 

0.9

%

 

0.9

%

 

0.9

%

 

 

 

 

 

 

 

 

 

 

 

ICM Production Data:

 

 

 

 

 

 

 

 

 

 

Mortgage pipeline

 

$

1,238,935

 

 

$

1,428,808

 

 

N/A

 

$

1,238,935

 

 

N/A

Loans originated

 

$

1,677,431

 

 

$

2,088,375

 

 

N/A

 

$

3,765,806

 

 

N/A

Loans closed

 

$

1,490,965

 

 

$

1,906,026

 

 

N/A

 

$

3,396,991

 

 

N/A

Loans sold

 

$

1,493,198

 

 

$

1,778,090

 

 

N/A

 

$

3,271,288

 

 

N/A

1

 

annualized for the quarterly periods presented

2

 

net interest income as a percentage of average interest-earning assets

3

 

presented on a fully tax-equivalent basis

4

 

noninterest expense as a percentage of net interest income and noninterest income, a non-U.S. GAAP measure

5

 

noninterest expense as a percentage of average assets, a non-U.S. GAAP measure

6

 

charge-offs less recoveries

7

 

excludes loans held for sale

 

Non-GAAP Reconciliation: Tangible Book Value per Common Share

(Unaudited) (Dollars in thousands, except per share data)

 

 

 

Quarterly

 

Year-to-Date

 

 

2021

 

2021

 

2020

 

2021

 

2020

 

 

Second Quarter

 

First Quarter

 

Second Quarter

 

 

Goodwill

 

$

4,119

 

 

$

2,350

 

 

$

19,232

 

 

$

4,119

 

 

$

19,232

 

Intangibles

 

2,692

 

 

2,246

 

 

2,708

 

 

2,692

 

 

$

2,708

 

Total intangibles

 

6,811

 

 

4,596

 

 

21,940

 

 

6,811

 

 

21,940

 

 

 

 

 

 

 

 

 

 

 

 

Total equity attributable to parent

 

248,611

 

 

236,210

 

 

228,500

 

 

248,611

 

 

228,500

 

Less: Preferred equity

 

 

 

 

 

(7,334)

 

 

 

 

(7,334)

 

Less: Total intangibles

 

(6,811)

 

 

(4,596)

 

 

(21,940)

 

 

(6,811)

 

 

(21,940)

 

Tangible common equity

 

241,800

 

 

231,614

 

 

199,226

 

 

241,800

 

 

199,226

 

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity

 

241,800

 

 

231,614

 

 

199,226

 

 

241,800

 

 

199,226

 

Common shares outstanding (000s)

 

11,774

 

11,590

 

11,968

 

11,774

 

11,968

Tangible book value per common share

 

$

20.54

 

 

$

19.98

 

 

$

16.65

 

 

$

20.54

 

 

$

16.65

 

 

Contacts

Amy Baker
VP, Corporate Communications and Marketing
MVB Bank
abaker@mvbbanking.com
(844) 682-2265

Contacts

Amy Baker
VP, Corporate Communications and Marketing
MVB Bank
abaker@mvbbanking.com
(844) 682-2265