ANCHORAGE, Alaska--(BUSINESS WIRE)--First National Bank Alaska’s (OTCQX:FBAK) unaudited net income for second quarter 2021 was $13.7 million, or $4.33 per share. This compares to net income of $14.6 million, or $4.60 per share, for the same period in 2020. Unaudited year-to-date net income was $27.7 million, or $8.74 per share, compared to $28.7 million, or $9.07 per share for the same period in 2020.
Total interest and loan fee income for second quarter 2021 was $35.8 million, a decrease of 6.8% from second quarter 2020 on lower annual yields on earning assets.
The blended yield on interest-earning assets decreased to 3.07% from 3.87% for the six-month periods ending June 30, 2021 and 2020, respectively. Lower yields on earning assets resulted from variable loan repricing, the addition of Small Business Administration Paycheck Protection Program (SBA PPP) loans, and significant cash and short-term investments. The year-to-date net interest margin moved to 3.03% compared to 3.72% in 2020 on declining yields on earning assets offset by decreasing cost of funds.
Noninterest income for second quarter 2021, excluding realized investment gains and losses, increased 8.4% from second quarter 2020 due to an increase in bankcard fee income generated by a higher volume of interchange activity. Noninterest expenses for second quarter 2021 increased 0.1% when compared to second quarter 2020. The efficiency ratio for June 30, 2021 increased to 53.25% compared to 52.24% for the same period last year.
Return on assets for the six-months ending June 30, 2021 decreased to 1.13% from 1.43% for the same period last year on a much larger asset size. Total assets were $5.3 billion as of June 30, 2021, an increase of $642.7 million year-to-date and $743.8 million since June 30, 2020.
Total loans increased $57.0 million year-to-date and decreased $40.9 million year-over-year. First National originated the highest volume of SBA PPP loans in Alaska during the first half of 2021 with more than 3,000 loans, totaling $238.1 million in the second round of funding. Outstanding SBA PPP loans total $295.7 million as of June 30, 2021. First National’s SBA PPP borrowers have received forgiveness totaling $278.8 million through the end of second quarter 2021 on first phase loans. Deposits and repurchase agreements increased $403.9 million and $804.3 million for the quarter and year-over-year, respectively. This increase was attributed to continuing CARES Act stimulus (which includes PPP loans) to individuals, businesses, governmental entities and Native tribes, and continued growth from organic business development efforts.
At June 30, 2021 delinquent loans from 30 to 89 days were $2.3 million, 0.12% of outstanding loans excluding SBA PPP loans, a decrease of $2.6 million from March 31, 2021. Nonperforming loans were $9.8 million, 0.50% of outstanding loans excluding SBA PPP loans, a decrease of $4.0 million from March 31, 2021. The allowance for loan losses at June 30, 2021 was $23.6 million, 1.04% of total loans (1.19% of loans excluding SBA PPP).
Loan modifications as of June 30, 2021 totaled $225.4 million, or 11.43% of total loans, excluding SBA PPP loans. Modification to interest-only payments accounted for more than 86% of the modifications, with interest-only periods ranging from one to twelve months. Modifications remain concentrated in the hospitality and tourism sectors.
“The bank continues to monitor the changing landscape of the COVID-19 pandemic to assure protocols are in place to maintain the health and safety of our employees and customers,” said Betsy Lawer, Board Chair and CEO. “The lessons learned in 2020 give us great confidence we will continue to be able to deliver the financial services Alaskans need, and to adapt to circumstances as they develop.”
Shareholders’ equity was $577.3 million as of June 30, 2021, compared to $586.6 million as of December 31, 2020 and $590.0 million as of June 30, 2020. Return on equity as of June 30, 2021 was 9.57% compared to 10.06% for the same period last year. Book value per share as of June 30, 2021 was $182.28, compared to $185.23 as of December 31, 2020 and $186.29 as of June 30, 2020. The bank’s June 30, 2021 Tier 1 leverage capital ratio of 10.81% remains above well-capitalized standards.
First National Bank Alaska files a quarterly financial report with the Federal Financial Institution Examination Council. Our latest Consolidated Report of Condition and Income (Call Report) is filed by the 30th of the month following quarter-end and is subsequently posted at www.FNBAlaska.com > Financial Reports and at www.OTCMarkets.com.
Alaskan-owned and -operated since 1922, First National proudly meets the financial needs of Alaskans with ATMs and branches in 18 communities throughout the state, and by providing banking services to meet their needs across the nation and around the world. In 2021, Alaska Business readers voted the bank the “Best of Alaska Business” in the Best Place to Work category for the sixth year in a row. American Banker recognized First National as a “Best Bank to Work For” for the third year in a row in 2020, and Anchorage Daily News readers voted the bank one of the state’s top two financial institutions in the ADN “Best of Alaska” Awards in 2020. First National was also recognized as the most admired company in the state by MSN.com and received the Rita Sholton Large Business of the Year Award from the Alaska Chamber.
Visit FNBAlaska.com for more information about Alaska’s largest locally owned bank and access to efficient and secure online banking services. First National Bank Alaska is a Member FDIC and Equal Housing Lender.
| Financial Overview (Unaudited) | Quarter Ended ($ in thousands) | ||||||||||||||||||
| 6/30/2021 | 3/31/2021 | 12/31/2020 | 9/30/2020 | 6/30/2020 | |||||||||||||||
| Balance Sheet | |||||||||||||||||||
| Total Assets | $ |
5,338,052 |
|
$ |
4,927,784 |
|
$ |
4,695,315 |
|
$ |
4,718,640 |
|
$ |
4,594,205 |
|
||||
| Total Securities | $ |
2,229,470 |
|
$ |
2,089,373 |
|
$ |
1,870,814 |
|
$ |
1,735,916 |
|
$ |
1,767,024 |
|
||||
| Total Loans | $ |
2,268,263 |
|
$ |
2,271,850 |
|
$ |
2,211,288 |
|
$ |
2,290,158 |
|
$ |
2,309,166 |
|
||||
| Total Deposits | $ |
3,910,717 |
|
$ |
3,486,685 |
|
$ |
3,113,169 |
|
$ |
3,045,898 |
|
$ |
2,912,046 |
|
||||
| Repurchase Agreements | $ |
830,245 |
|
$ |
850,409 |
|
$ |
969,766 |
|
$ |
1,022,024 |
|
$ |
1,024,610 |
|
||||
| Total Deposits and Repurchase Agreements | $ |
4,740,962 |
|
$ |
4,337,094 |
|
$ |
4,082,935 |
|
$ |
4,067,922 |
|
$ |
3,936,656 |
|
||||
| Total Shareholders' Equity | $ |
577,266 |
|
$ |
571,083 |
|
$ |
586,589 |
|
$ |
585,429 |
|
$ |
589,966 |
|
||||
| Income Statement | |||||||||||||||||||
| Net Interest and Loan Fee Income | $ |
35,466 |
|
$ |
36,708 |
|
$ |
35,721 |
|
$ |
36,615 |
|
$ |
37,910 |
|
||||
| Provision for Loan losses | $ |
1,033 |
|
$ |
1,697 |
|
$ |
32 |
|
$ |
250 |
|
$ |
1,949 |
|
||||
| Total Noninterest Income | $ |
6,787 |
|
$ |
6,198 |
|
$ |
7,102 |
|
$ |
6,677 |
|
$ |
6,459 |
|
||||
| Total Noninterest Expense | $ |
22,974 |
|
$ |
22,569 |
|
$ |
24,823 |
|
$ |
22,196 |
|
$ |
22,951 |
|
||||
| Provision for Income Taxes | $ |
4,547 |
|
$ |
4,663 |
|
$ |
4,704 |
|
$ |
5,293 |
|
$ |
4,899 |
|
||||
| Net Income | $ |
13,699 |
|
$ |
13,977 |
|
$ |
13,264 |
|
$ |
15,553 |
|
$ |
14,570 |
|
||||
| Earnings per common share | $ |
4.33 |
|
$ |
4.41 |
|
$ |
4.19 |
|
$ |
4.91 |
|
$ |
4.60 |
|
||||
| Dividend per common share | $ |
3.20 |
|
$ |
3.20 |
|
$ |
3.20 |
|
$ |
6.40 |
|
$ |
3.20 |
|
||||
| Financial Measures | |||||||||||||||||||
| Return on Assets |
|
1.13 |
% |
|
1.18 |
% |
|
1.33 |
% |
|
1.40 |
% |
|
1.43 |
% |
||||
| Return on Equity |
|
9.57 |
% |
|
9.66 |
% |
|
9.97 |
% |
|
10.27 |
% |
|
10.06 |
% |
||||
| Net Interest Margin |
|
3.03 |
% |
|
3.19 |
% |
|
3.45 |
% |
|
3.56 |
% |
|
3.72 |
% |
||||
| Yield on Loans |
|
5.10 |
% |
|
5.31 |
% |
|
5.27 |
% |
|
5.34 |
% |
|
5.46 |
% |
||||
| Yield on Securities |
|
1.51 |
% |
|
1.56 |
% |
|
1.96 |
% |
|
2.05 |
% |
|
2.19 |
% |
||||
| Cost of Interest Bearing Deposits |
|
0.04 |
% |
|
0.05 |
% |
|
0.07 |
% |
|
0.08 |
% |
|
0.09 |
% |
||||
| Efficiency Ratio |
|
53.25 |
% |
|
52.18 |
% |
|
53.28 |
% |
|
51.74 |
% |
|
52.24 |
% |
||||
| Capital | |||||||||||||||||||
| Shareholders' Equity/Total Assets |
|
10.81 |
% |
|
11.59 |
% |
|
12.49 |
% |
|
12.41 |
% |
|
12.84 |
% |
||||
| Tier 1 Leverage Ratio |
|
10.81 |
% |
|
11.45 |
% |
|
11.52 |
% |
|
11.63 |
% |
|
12.72 |
% |
||||
| Regulatory Well Capitalized Minimum Ratio - Tier 1 Leverage Ratio |
|
5.00 |
% |
|
5.00 |
% |
|
5.00 |
% |
|
5.00 |
% |
|
5.00 |
% |
||||
| Tier 1 (Core) Capital | $ |
545,928 |
|
$ |
542,363 |
|
$ |
538,520 |
|
$ |
535,390 |
|
$ |
540,105 |
|
||||
| Credit Quality | |||||||||||||||||||
| Noncurrent Loans and OREO | $ |
11,446 |
|
$ |
14,314 |
|
$ |
14,094 |
|
$ |
13,803 |
|
$ |
13,511 |
|
||||
| Noncurrent Loans and OREO/Total Assets |
|
0.21 |
% |
|
0.29 |
% |
|
0.30 |
% |
|
0.29 |
% |
|
0.29 |
% |
||||
| Noncurrent Loans and OREO/Tier 1 Capital |
|
2.10 |
% |
|
2.64 |
% |
|
2.62 |
% |
|
2.58 |
% |
|
2.50 |
% |
||||
| Allowance for Loan Losses | $ |
23,500 |
|
$ |
23,550 |
|
$ |
21,550 |
|
$ |
21,550 |
|
$ |
21,550 |
|
||||
| Allowance for Loan Losses/Total Loans |
|
1.04 |
% |
|
1.04 |
% |
|
0.97 |
% |
|
0.94 |
% |
|
0.93 |
% |
||||
| Net interest margin, yields, and efficiency ratios are tax effected. | |||||||||||||||||||
| Financial measures are year-to-date. | |||||||||||||||||||
| Per common share amounts are not in thousands. | |||||||||||||||||||