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23.07.2021 17:12:00
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Isabella Bank Corporation Announces Strong Second Quarter 2021 Earnings
MT. PLEASANT, Mich., July 23, 2021 /PRNewswire/ -- Isabella Bank Corporation (the "Corporation") (OTCQX: ISBA) released its earnings results for the second quarter of 2021. The Corporation reported net income of $4.6 million for the second quarter and $10 million for the first six months of 2021, both increased compared to the same periods a year ago. Earnings per common share were $0.58 in the second quarter and $1.26 for the first half of the year, up from the same periods of 2020 at $0.53 and $0.91, respectively.
Highlights include:
- Completed a $30 million private placement of subordinated notes with an initial interest rate of 3.25%.
- Net interest income — $12.7 million in the second quarter of 2021. Interest expense initiatives reduced costs by 45.9%, or $1.6 million, compared to the same period in 2020.
- Noninterest expense controls continue to benefit the Corporation.
- Loan payment deferrals, to provide short-term relief to customers, continued to decline as customers resumed contractual payments. As of June 30, 2021, loan deferrals totaled just 0.3% of gross loans.
"We delivered another strong financial quarter following our record performance from the previous quarter," said Jae A. Evans, President and Chief Executive Officer of the Corporation. "Here at Isabella Bank, we continue to be a resource to our customers in a recovering economy. We facilitated over 950 PPP loans for a total of $99.5 million in 2020, and funded another 845 PPP loans for a total of $54.6 million this year. We also assisted customers by removing selected deposit account related charges and fees in day-to-day banking and temporarily waiving others."
On June 2, 2021, the Corporation completed a private placement of $30 million in fixed-to-floating rate notes due in 2031. The subordinated notes will initially bear a fixed interest rate of 3.25% until June 15, 2026, after which time until maturity, the notes convert to a floating rate instrument. The notes, issued to institutional investors, are structured to qualify as Tier 2 capital under regulatory guidelines. The Corporation expects to use proceeds from issuance of the notes for general corporate purposes, including potential repurchases of common stock and merger and acquisition activity.
"We are strengthening our ability to increase our presence while we continue to manage operating costs," Evans said. "We also remain committed to increasing earnings and shareholder value through growth in our loan portfolio and Isabella Wealth."
Operating Results
Net income: Net income for the second quarter 2021 was $4.6 million, compared to $4.2 million in the second quarter of 2020. For the first six months of 2021, net income was $10 million, compared to $7.3 million in the same period of 2020.
Net interest income: Net interest income for the first six months of 2021 increased by $1.6 million compared to the same period in 2020. Fees related to the U.S. Small Business Administration's Paycheck Protection Program ("PPP") have contributed significantly to interest income in 2021; however, fewer total loans and an interest rate decline led to a $2.1 million decrease in interest income when comparing the first two quarters of 2021 to 2020. Conversely, the reduction in interest rates, as well as reduced reliance on higher-cost borrowings, led to a $3.7 million decrease in interest expense on deposits and borrowings.
Noninterest income and expenses: Net gains on sold mortgage loans along with service charges and fees accounted for much of a $603,000 increase in noninterest income for the first six months of 2021 when compared to the same period in 2020. Noninterest expenses declined $333,000 for the first six months of 2021 compared to 2020, reflecting management's continued focus on reducing operating expenses.
Net yield on interest earning assets: The Corporation's fully taxable equivalent net yield on interest earning assets was 2.88% for the first six months of 2021 compared to 2.95% in the first six months of 2020. The Corporation's banking subsidiary, Isabella Bank (the "Bank"), implemented strategic programs focused on improving the net yield on interest-earning assets, such as enhanced pricing related to loans and reduced reliance on higher-cost borrowed funds and brokered deposits. These efforts have helped, although the current interest rate environment has had a negative impact on the yield of interest-earning assets. Future improvement is expected at a gradual pace.
Balance Sheet
Assets: Total assets and assets under management were $2 billion and $2.8 billion as of June 30, 2021, respectively. Assets under management include loans sold and serviced of $290 million and investment and trust assets managed by Isabella Wealth of $493 million, in addition to assets on our consolidated balance sheet. Assets under management are up $243 million, or 9.4%, compared to June 30, 2020. Market improvement and growth in new client assets managed by Isabella Wealth, as well as growth in deposits, account for this increase.
Loans: Loans outstanding as of June 30, 2021, totaled $1.2 billion. Approximately $62 million of PPP loans are included in the commercial loan balance. During the first six months of 2021, gross loans declined $31.6 million, largely driven by a decrease in advances to mortgage brokers, which also is included in the commercial loan portfolio. Credit quality indicators remained strong and economic factors continued to improve in the second quarter.
Deposits: Total deposits were $1.64 billion as of June 30, 2021, an increase of $70.2 million since December 31, 2020. Since June 2020, total deposits have increased 13.6%. The increase of deposits is the result of funds from PPP loans, customers receiving stimulus checks, and attracting new customers.
Liquidity
The Corporation's liquidity position remains strong as evidenced by its $797 million of cash and available funds as of June 30, 2021. This total is comprised of $248.2 million in cash and cash equivalents, $248.8 million in available lines of credit and approximately $300 million in unencumbered investment securities.
Capital
The Bank is designated as a "well capitalized" institution, as its capital ratios exceeded the minimum requirements for this designation. As of June 30, 2021, the Bank's Tier 1 Leverage Ratio was 8.3%, Tier 1 Capital Ratio was 13.5% and Total Capital Ratio was 14.2%. From a consolidated perspective, the Corporation's Tier 1 Leverage Ratio was 8.5%, Tier 1 Capital Ratio was 13.8% and Total Capital Ratio was 17.0% as of June 30, 2021. The minimum requirements to be considered well capitalized are a Tier 1 Leverage Ratio of 5.0%, Tier 1 Capital Ratio of 8.0% and Total Capital Ratio of 10.0%.
Dividend
During the second quarter of 2021, the Corporation paid a $0.27 per common share cash dividend. Based on the Corporation's closing stock price of $23.00 as of June 30, 2021, the annualized cash dividend yield was 4.70%.
About the Corporation
Isabella Bank Corporation (OTCQX: ISBA) is the parent holding company of Isabella Bank, a state chartered community bank headquartered in Mt. Pleasant, Michigan. Isabella Bank was established in 1903 and has been committed to serving the local banking needs of its customers and communities for 118 years. The Bank offers personal and commercial lending and deposit products, as well as investment, trust, and estate planning services through Isabella Wealth. The Bank has locations throughout seven Mid-Michigan counties: Clare, Gratiot, Isabella, Mecosta, Midland, Montcalm, and Saginaw.
For more information about Isabella Bank Corporation, visit the Investors link at www.isabellabank.com. Isabella Bank Corporation common stock is quoted on the OTCQX tier of the OTC Markets Group, Inc.'s electronic quotation system (www.otcmarkets.com) under the symbol "ISBA." The Corporation's market maker is Boenning & Scattergood, Inc. (www.boenninginc.com) and its investor relations firm is Renmark Financial Communications, Inc. (www.renmarkfinancial.com).
Forward-Looking Statements
This press release includes forward-looking statements. To the extent that the foregoing information refers to matters that may occur in the future, please be aware that such forward-looking statements may differ materially from actual results. Additional information concerning some of the factors that could cause materially different results is included in the sections entitled "Risk Factors" and "Forward Looking Statements" set forth in Isabella Bank Corporation's filings with the Securities and Exchange Commission, which are available from the Securities and Exchange Commission's Public Reference facilities and from its website at www.sec.gov.
INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) | |||||||
(Dollars in thousands) | |||||||
June 30 | December 31 | ||||||
ASSETS | |||||||
Cash and cash equivalents | |||||||
Cash and demand deposits due from banks | $ | 29,549 | $ | 31,296 | |||
Interest bearing balances due from banks | 218,640 | 215,344 | |||||
Total cash and cash equivalents | 248,189 | 246,640 | |||||
Available-for-sale securities, at fair value | 448,454 | 339,228 | |||||
Mortgage loans available-for-sale | 1,189 | 2,741 | |||||
Loans | |||||||
Commercial | 723,888 | 756,686 | |||||
Agricultural | 95,197 | 100,461 | |||||
Residential real estate | 312,567 | 307,543 | |||||
Consumer | 75,011 | 73,621 | |||||
Gross loans | 1,206,663 | 1,238,311 | |||||
Less allowance for loan and lease losses | 9,360 | 9,744 | |||||
Net loans | 1,197,303 | 1,228,567 | |||||
Premises and equipment | 24,463 | 25,140 | |||||
Corporate owned life insurance policies | 28,238 | 28,292 | |||||
Equity securities without readily determinable fair values | 17,383 | 17,383 | |||||
Goodwill and other intangible assets | 48,317 | 48,331 | |||||
Accrued interest receivable and other assets | 17,871 | 21,056 | |||||
TOTAL ASSETS | $ | 2,031,407 | $ | 1,957,378 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
Deposits | |||||||
Noninterest bearing | $ | 428,410 | $ | 375,395 | |||
Interest bearing demand deposits | 326,971 | 302,444 | |||||
Certificates of deposit under $250 and other savings | 796,173 | 781,286 | |||||
Certificates of deposit over $250 | 84,952 | 107,192 | |||||
Total deposits | 1,636,506 | 1,566,317 | |||||
Borrowed funds | |||||||
Federal funds purchased and repurchase agreements | 62,274 | 68,747 | |||||
Federal Home Loan Bank advances | 70,000 | 90,000 | |||||
Subordinated debt, net of unamortized issuance costs | 29,121 | — | |||||
Total borrowed funds | 161,395 | 158,747 | |||||
Accrued interest payable and other liabilities | 12,516 | 13,726 | |||||
Total liabilities | 1,810,417 | 1,738,790 | |||||
Shareholders' equity | |||||||
Common stock — no par value 15,000,000 shares authorized; issued and outstanding | 140,694 | 142,247 | |||||
Shares to be issued for deferred compensation obligations | 4,368 | 4,183 | |||||
Retained earnings | 70,204 | 64,460 | |||||
Accumulated other comprehensive income | 5,724 | 7,698 | |||||
Total shareholders' equity | 220,990 | 218,588 | |||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 2,031,407 | $ | 1,957,378 | |||
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | |||||||||||||||
(Dollars in thousands except per share amounts) | |||||||||||||||
Three Months Ended June 30 | Six Months Ended June 30 | ||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||
Interest income | |||||||||||||||
Loans, including fees | $ | 12,504 | $ | 13,297 | $ | 25,601 | $ | 26,551 | |||||||
Available-for-sale securities | |||||||||||||||
Taxable | 1,140 | 1,352 | 2,305 | 2,841 | |||||||||||
Nontaxable | 803 | 986 | 1,668 | 2,039 | |||||||||||
Federal funds sold and other | 193 | 234 | 356 | 639 | |||||||||||
Total interest income | 14,640 | 15,869 | 29,930 | 32,070 | |||||||||||
Interest expense | |||||||||||||||
Deposits | 1,444 | 2,247 | 3,112 | 5,038 | |||||||||||
Borrowings | |||||||||||||||
Federal funds purchased and repurchase | 11 | 7 | 27 | 15 | |||||||||||
Federal Home Loan Bank advances | 389 | 1,311 | 794 | 2,711 | |||||||||||
Subordinated debt, net of unamortized issuance costs | 83 | — | 83 | — | |||||||||||
Total interest expense | 1,927 | 3,565 | 4,016 | 7,764 | |||||||||||
Net interest income | 12,713 | 12,304 | 25,914 | 24,306 | |||||||||||
Provision for loan losses | 31 | 105 | (492) | 893 | |||||||||||
Net interest income after provision for | 12,682 | 12,199 | 26,406 | 23,413 | |||||||||||
Noninterest income | |||||||||||||||
Service charges and fees | 1,830 | 1,386 | 3,525 | 2,739 | |||||||||||
Wealth management fees | 806 | 656 | 1,502 | 1,228 | |||||||||||
Net gain on sale of mortgage loans | 375 | 466 | 1,120 | 617 | |||||||||||
Earnings on corporate owned life insurance policies | 190 | 189 | 376 | 371 | |||||||||||
Gains from redemption of corporate owned life insurance policies | 4 | 349 | 150 | 873 | |||||||||||
Other | 110 | 200 | 174 | 416 | |||||||||||
Total noninterest income | 3,315 | 3,246 | 6,847 | 6,244 | |||||||||||
Noninterest expenses | |||||||||||||||
Compensation and benefits | 5,700 | 5,793 | 11,577 | 11,662 | |||||||||||
Furniture and equipment | 1,327 | 1,431 | 2,700 | 2,892 | |||||||||||
Occupancy | 915 | 912 | 1,860 | 1,779 | |||||||||||
Other | 2,553 | 2,564 | 5,175 | 5,312 | |||||||||||
Total noninterest expenses | 10,495 | 10,700 | 21,312 | 21,645 | |||||||||||
Income before federal income tax | 5,502 | 4,745 | 11,941 | 8,012 | |||||||||||
Federal income tax expense | 881 | 558 | 1,922 | 761 | |||||||||||
NET INCOME | $ | 4,621 | $ | 4,187 | $ | 10,019 | $ | 7,251 | |||||||
Earnings per common share | |||||||||||||||
Basic | $ | 0.58 | $ | 0.53 | $ | 1.26 | $ | 0.91 | |||||||
Diluted | $ | 0.57 | $ | 0.52 | $ | 1.24 | $ | 0.90 | |||||||
Cash dividends per common share | $ | 0.27 | $ | 0.27 | $ | 0.54 | $ | 0.54 | |||||||
AVERAGE BALANCES, INTEREST RATE, AND NET INTEREST INCOME (UNAUDITED) |
(Dollars in thousands) |
The following schedules present the daily average amount outstanding for each major category of interest earning assets, non-earning assets, interest bearing liabilities, and noninterest bearing liabilities. These schedules also present an analysis of interest income and interest expense for the periods indicated. All interest income is reported on a fully taxable equivalent (FTE) basis using a federal income tax rate of 21%. Loans in nonaccrual status, for the purpose of the following computations, are included in the average loan balances. Federal Reserve Bank (FRB) and Federal Home Loan Bank (FHLB) restricted equity holdings are included in other interest earning assets. |
Three Months Ended | |||||||||||||||||||||
June 30, 2021 | June 30, 2020 | ||||||||||||||||||||
Average | Tax | Average | Average | Tax | Average | ||||||||||||||||
INTEREST EARNING ASSETS | |||||||||||||||||||||
Loans | $ | 1,200,998 | $ | 12,504 | 4.16 | % | $ | 1,241,856 | $ | 13,297 | 4.28 | % | |||||||||
Taxable investment securities | 281,245 | 1,140 | 1.62 | % | 237,769 | 1,352 | 2.27 | % | |||||||||||||
Nontaxable investment securities | 122,514 | 1,117 | 3.65 | % | 141,229 | 1,333 | 3.78 | % | |||||||||||||
Fed funds sold | 3 | — | 0.01 | % | 12 | — | 0.04 | % | |||||||||||||
Other | 265,227 | 193 | 0.29 | % | 111,702 | 234 | 0.84 | % | |||||||||||||
Total earning assets | 1,869,987 | 14,954 | 3.20 | % | 1,732,568 | 16,216 | 3.74 | % | |||||||||||||
NONEARNING ASSETS | |||||||||||||||||||||
Allowance for loan losses | (9,326) | (8,769) | |||||||||||||||||||
Cash and demand deposits due from banks | 28,629 | 20,389 | |||||||||||||||||||
Premises and equipment | 24,826 | 25,854 | |||||||||||||||||||
Accrued income and other assets | 106,780 | 120,444 | |||||||||||||||||||
Total assets | $ | 2,020,896 | $ | 1,890,486 | |||||||||||||||||
INTEREST BEARING LIABILITIES | |||||||||||||||||||||
Interest bearing demand deposits | $ | 330,586 | $ | 45 | 0.05 | % | $ | 249,735 | $ | 86 | 0.14 | % | |||||||||
Savings deposits | 550,145 | 149 | 0.11 | % | 447,416 | 257 | 0.23 | % | |||||||||||||
Time deposits | 347,155 | 1,250 | 1.44 | % | 387,636 | 1,904 | 1.96 | % | |||||||||||||
Federal funds purchased and repurchase agreements | 52,239 | 11 | 0.08 | % | 31,036 | 7 | 0.09 | % | |||||||||||||
Federal Home Loan Bank advances | 84,725 | 389 | 1.84 | % | 222,802 | 1,311 | 2.35 | % | |||||||||||||
Subordinated debt, net of unamortized issuance costs | 9,551 | 83 | 3.48 | % | — | — | — | % | |||||||||||||
Total interest bearing liabilities | 1,374,401 | 1,927 | 0.56 | % | 1,338,625 | 3,565 | 1.07 | % | |||||||||||||
NONINTEREST BEARING LIABILITIES | |||||||||||||||||||||
Demand deposits | 412,600 | 317,035 | |||||||||||||||||||
Other | 12,478 | 15,355 | |||||||||||||||||||
Shareholders' equity | 221,417 | 219,471 | |||||||||||||||||||
Total liabilities and shareholders' equity | $ | 2,020,896 | $ | 1,890,486 | |||||||||||||||||
Net interest income (FTE) | $ | 13,027 | $ | 12,651 | |||||||||||||||||
Net yield on interest earning assets (FTE) | 2.79 | % | 2.92 | % | |||||||||||||||||
Six Months Ended | |||||||||||||||||||||
June 30, 2021 | June 30, 2020 | ||||||||||||||||||||
Average | Tax | Average | Average | Tax | Average | ||||||||||||||||
INTEREST EARNING ASSETS | |||||||||||||||||||||
Loans | $ | 1,201,344 | $ | 25,601 | 4.26 | % | $ | 1,204,961 | $ | 26,551 | 4.41 | % | |||||||||
Taxable investment securities | 236,099 | 2,305 | 1.95 | % | 244,783 | 2,841 | 2.32 | % | |||||||||||||
Nontaxable investment securities | 127,157 | 2,311 | 3.63 | % | 146,799 | 2,751 | 3.75 | % | |||||||||||||
Fed funds sold | 3 | — | 0.01 | % | 6 | — | 0.07 | % | |||||||||||||
Other | 280,083 | 356 | 0.25 | % | 101,000 | 639 | 1.27 | % | |||||||||||||
Total earning assets | 1,844,686 | 30,573 | 3.31 | % | 1,697,549 | 32,782 | 3.86 | % | |||||||||||||
NONEARNING ASSETS | |||||||||||||||||||||
Allowance for loan losses | (9,574) | (8,368) | |||||||||||||||||||
Cash and demand deposits due from banks | 28,787 | 20,972 | |||||||||||||||||||
Premises and equipment | 24,987 | 26,052 | |||||||||||||||||||
Accrued income and other assets | 109,898 | 115,615 | |||||||||||||||||||
Total assets | $ | 1,998,784 | $ | 1,851,820 | |||||||||||||||||
INTEREST BEARING LIABILITIES | |||||||||||||||||||||
Interest bearing demand deposits | $ | 322,931 | $ | 122 | 0.08 | % | $ | 242,448 | $ | 169 | 0.14 | % | |||||||||
Savings deposits | 540,776 | 298 | 0.11 | % | 437,025 | 891 | 0.41 | % | |||||||||||||
Time deposits | 357,466 | 2,692 | 1.51 | % | 396,178 | 3,978 | 2.01 | % | |||||||||||||
Federal funds purchased and repurchase agreements | 53,187 | 27 | 0.10 | % | 30,980 | 15 | 0.10 | % | |||||||||||||
Federal Home Loan Bank advances | 87,348 | 794 | 1.82 | % | 231,264 | 2,711 | 2.34 | % | |||||||||||||
Subordinated debt, net of unamortized issuance costs | 4,665 | 83 | 3.56 | % | — | — | — | % | |||||||||||||
Total interest bearing liabilities | 1,366,373 | 4,016 | 0.59 | % | 1,337,895 | 7,764 | 1.16 | % | |||||||||||||
NONINTEREST BEARING LIABILITIES | |||||||||||||||||||||
Demand deposits | 397,959 | 281,638 | |||||||||||||||||||
Other | 13,311 | 14,747 | |||||||||||||||||||
Shareholders' equity | 221,141 | 217,540 | |||||||||||||||||||
Total liabilities and shareholders' equity | $ | 1,998,784 | $ | 1,851,820 | |||||||||||||||||
Net interest income (FTE) | $ | 26,557 | $ | 25,018 | |||||||||||||||||
Net yield on interest earning assets (FTE) | 2.88 | % | 2.95 | % | |||||||||||||||||
SELECTED FINANCIAL DATA (UNAUDITED) | |||||||||||||||||||
(Dollars in thousands except per share amounts) | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
June 30 | March 31 | December 31 | September 30 | June 30 | |||||||||||||||
PER SHARE | |||||||||||||||||||
Basic earnings (loss) | $ | 0.58 | $ | 0.68 | $ | (0.10) | $ | 0.55 | $ | 0.53 | |||||||||
Diluted earnings (loss) | $ | 0.57 | $ | 0.67 | $ | (0.10) | $ | 0.54 | $ | 0.52 | |||||||||
Dividends | $ | 0.27 | $ | 0.27 | $ | 0.27 | $ | 0.27 | $ | 0.27 | |||||||||
Tangible book value | $ | 21.73 | $ | 21.35 | $ | 21.29 | $ | 21.75 | $ | 21.52 | |||||||||
Quoted market value | |||||||||||||||||||
High | $ | 23.90 | $ | 22.50 | $ | 21.95 | $ | 19.00 | $ | 19.50 | |||||||||
Low | $ | 21.00 | $ | 19.45 | $ | 15.73 | $ | 15.75 | $ | 15.60 | |||||||||
Close (1) | $ | 23.00 | $ | 21.75 | $ | 19.57 | $ | 16.74 | $ | 18.25 | |||||||||
Common shares outstanding (1) | 7,946,658 | 7,958,883 | 7,997,247 | 8,007,901 | 7,977,019 | ||||||||||||||
Average number of common shares outstanding | 7,944,455 | 7,969,462 | 8,006,144 | 7,966,811 | 7,924,318 | ||||||||||||||
Average number of diluted common shares outstanding | 8,063,164 | 8,088,524 | 8,133,157 | 8,111,283 | 8,068,748 | ||||||||||||||
PERFORMANCE RATIOS | |||||||||||||||||||
Return on average total assets | 0.91 | % | 1.09 | % | (0.15) | % | 0.90 | % | 0.89 | % | |||||||||
Return on average shareholders' equity | 8.35 | % | 9.78 | % | (1.30) | % | 7.78 | % | 7.63 | % | |||||||||
Return on average tangible shareholders' equity | 10.69 | % | 12.53 | % | (1.63) | % | 9.93 | % | 9.81 | % | |||||||||
Net interest margin yield (FTE) | 2.79 | % | 2.98 | % | 3.04 | % | 2.89 | % | 2.92 | % | |||||||||
ASSETS UNDER MANAGEMENT (1) | |||||||||||||||||||
Loans sold with servicing retained | $ | 290,033 | $ | 298,514 | $ | 301,377 | $ | 289,524 | $ | 263,332 | |||||||||
Assets managed by Isabella Wealth | $ | 493,287 | $ | 454,459 | $ | 443,967 | $ | 403,730 | $ | 395,214 | |||||||||
Total assets under management | $ | 2,814,727 | $ | 2,768,405 | $ | 2,702,722 | $ | 2,664,951 | $ | 2,571,773 | |||||||||
ASSET QUALITY (1) | |||||||||||||||||||
Nonaccrual status loans | $ | 3,329 | $ | 4,532 | $ | 5,313 | $ | 4,946 | $ | 5,319 | |||||||||
Performing troubled debt restructurings | $ | 26,785 | $ | 28,947 | $ | 22,200 | $ | 23,257 | $ | 20,536 | |||||||||
Foreclosed assets | $ | 365 | $ | 384 | $ | 527 | $ | 651 | $ | 776 | |||||||||
Net loan charge-offs (recoveries) | $ | (58) | $ | (50) | $ | 18 | $ | (113) | $ | (75) | |||||||||
Nonperforming loans to gross loans | 0.28 | % | 0.38 | % | 0.43 | % | 0.38 | % | 0.42 | % | |||||||||
Nonperforming assets to total assets | 0.19 | % | 0.26 | % | 0.31 | % | 0.30 | % | 0.33 | % | |||||||||
Allowance for loan and lease losses to gross loans | 0.78 | % | 0.78 | % | 0.79 | % | 0.73 | % | 0.69 | % | |||||||||
CAPITAL RATIOS (1) | |||||||||||||||||||
Shareholders' equity to assets | 10.88 | % | 10.83 | % | 11.17 | % | 11.29 | % | 11.50 | % | |||||||||
Tier 1 leverage | 8.46 | % | 8.56 | % | 8.37 | % | 8.76 | % | 8.86 | % | |||||||||
Common equity tier 1 capital | 13.81 | % | 13.77 | % | 12.97 | % | 12.90 | % | 12.90 | % | |||||||||
Tier 1 risk-based capital | 13.81 | % | 13.77 | % | 12.97 | % | 12.90 | % | 12.90 | % | |||||||||
Total risk-based capital | 17.00 | % | 14.54 | % | 13.75 | % | 13.64 | % | 13.60 | % | |||||||||
(1) At end of period |
Six Months Ended | |||||||||||
June 30 | June 30 | June 30 | |||||||||
PER SHARE | |||||||||||
Basic earnings | $ | 1.26 | $ | 0.91 | $ | 0.97 | |||||
Diluted earnings | $ | 1.24 | $ | 0.90 | $ | 0.95 | |||||
Dividends | $ | 0.54 | $ | 0.54 | $ | 0.52 | |||||
Tangible book value | $ | 21.73 | $ | 21.52 | $ | 20.17 | |||||
Quoted market value | |||||||||||
High | $ | 23.90 | $ | 24.50 | $ | 24.50 | |||||
Low | $ | 19.45 | $ | 15.60 | $ | 22.25 | |||||
Close (1) | $ | 23.00 | $ | 18.25 | $ | 23.25 | |||||
Common shares outstanding (1) | 7,946,658 | 7,977,019 | 7,918,494 | ||||||||
Average number of common shares outstanding | 7,956,889 | 7,927,298 | 7,895,610 | ||||||||
Average number of diluted common shares outstanding | 8,075,763 | 8,081,475 | 8,084,965 | ||||||||
PERFORMANCE RATIOS | |||||||||||
Return on average total assets | 1.00 | % | 0.78 | % | 0.85 | % | |||||
Return on average shareholders' equity | 9.06 | % | 6.67 | % | 7.58 | % | |||||
Return on average tangible shareholders' equity | 11.61 | % | 4.30 | % | 9.73 | % | |||||
Net interest margin yield (FTE) | 2.88 | % | 2.95 | % | 3.04 | % | |||||
ASSETS UNDER MANAGEMENT (1) | |||||||||||
Loans sold with servicing retained | $ | 290,033 | $ | 263,332 | $ | 257,062 | |||||
Assets managed by Isabella Wealth | $ | 493,287 | $ | 395,214 | $ | 487,180 | |||||
Total assets under management | $ | 2,814,727 | $ | 2,571,773 | $ | 2,568,834 | |||||
ASSET QUALITY (1) | |||||||||||
Nonaccrual status loans | $ | 3,329 | $ | 5,319 | $ | 8,107 | |||||
Performing troubled debt restructurings | $ | 26,785 | $ | 20,536 | $ | 20,310 | |||||
Foreclosed assets | $ | 365 | $ | 776 | $ | 513 | |||||
Net loan charge-offs (recoveries) | $ | (108) | $ | (45) | $ | 193 | |||||
Nonperforming loans to gross loans | 0.28 | % | 0.42 | % | 0.70 | % | |||||
Nonperforming assets to total assets | 0.19 | % | 0.33 | % | 0.49 | % | |||||
Allowance for loan and lease losses to gross loans | 0.78 | % | 0.69 | % | 0.68 | % | |||||
CAPITAL RATIOS (1) | |||||||||||
Shareholders' equity to assets | 10.88 | % | 11.50 | % | 11.41 | % | |||||
Tier 1 leverage | 8.46 | % | 8.86 | % | 9.03 | % | |||||
Common equity tier 1 capital | 13.81 | % | 12.90 | % | 12.43 | % | |||||
Tier 1 risk-based capital | 13.81 | % | 12.90 | % | 12.43 | % | |||||
Total risk-based capital | 17.00 | % | 13.60 | % | 13.06 | % | |||||
(1) At end of period |
SUPPLEMENTAL BALANCE SHEET DATA (UNAUDITED) | |||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||
June 30 | March 31 | December 31 | September 30 | June 30 | |||||||||||||||
Commercial | $ | 723,888 | $ | 725,540 | $ | 756,686 | $ | 821,102 | $ | 799,632 | |||||||||
Agricultural | 95,197 | 91,629 | 100,461 | 102,263 | 103,162 | ||||||||||||||
Residential real estate | 312,567 | 305,909 | 307,543 | 304,559 | 307,926 | ||||||||||||||
Consumer | 75,011 | 72,840 | 73,621 | 75,384 | 73,665 | ||||||||||||||
Gross loans | $ | 1,206,663 | $ | 1,195,918 | $ | 1,238,311 | $ | 1,303,308 | $ | 1,284,385 | |||||||||
June 30 | March 31 | December 31 | September 30 | June 30 | |||||||||||||||
Noninterest bearing demand deposits | $ | 428,410 | $ | 404,710 | $ | 375,395 | $ | 353,082 | $ | 340,321 | |||||||||
Interest bearing demand deposits | 326,971 | 328,440 | 302,444 | 287,809 | 263,567 | ||||||||||||||
Savings deposits | 549,134 | 555,688 | 505,497 | 474,483 | 458,167 | ||||||||||||||
Certificates of deposit | 326,214 | 331,413 | 358,165 | 354,210 | 352,118 | ||||||||||||||
Brokered certificates of deposit | — | 14,029 | 14,029 | 14,029 | 14,029 | ||||||||||||||
Internet certificates of deposit | 5,777 | 9,301 | 10,787 | 11,482 | 12,476 | ||||||||||||||
Total deposits | $ | 1,636,506 | $ | 1,643,581 | $ | 1,566,317 | $ | 1,495,095 | $ | 1,440,678 | |||||||||
June 30 | March 31 | December 31 | September 30 | June 30 | |||||||||||||||
U.S. Treasury | $ | 132,593 | $ | 29,371 | $ | — | $ | — | $ | — | |||||||||
States and political subdivisions | 130,960 | 140,329 | 143,656 | 148,401 | 146,785 | ||||||||||||||
Auction rate money market preferred | 3,260 | 3,224 | 3,237 | 3,194 | 2,979 | ||||||||||||||
Mortgage-backed securities | 68,155 | 75,835 | 88,652 | 104,165 | 119,029 | ||||||||||||||
Collateralized mortgage obligations | 109,294 | 116,865 | 101,983 | 107,294 | 111,621 | ||||||||||||||
Corporate | 4,192 | 1,700 | 1,700 | — | — | ||||||||||||||
Available-for-sale securities, at fair value | $ | 448,454 | $ | 367,324 | $ | 339,228 | $ | 363,054 | $ | 380,414 | |||||||||
June 30 | March 31 | December 31 | September 30 | June 30 | |||||||||||||||
Federal Home Loan Bank advances | $ | 70,000 | $ | 90,000 | $ | 90,000 | $ | 205,000 | $ | 205,000 | |||||||||
Securities sold under agreements to repurchase without stated maturity dates | 62,274 | 51,967 | 68,747 | 33,349 | 31,268 | ||||||||||||||
Subordinated debt, net of unamortized issuance costs | 29,121 | — | — | — | — | ||||||||||||||
Total borrowed funds | $ | 161,395 | $ | 141,967 | $ | 158,747 | $ | 238,349 | $ | 236,268 | |||||||||
SUPPLEMENTAL STATEMENTS OF INCOME DATA (UNAUDITED) | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
Three Months Ended June 30 | Six Months Ended June 30 | ||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||
Service charges and fees | |||||||||||||||
ATM and debit card fees | $ | 1,127 | $ | 883 | $ | 2,126 | $ | 1,677 | |||||||
Service charges and fees on deposit accounts | 481 | 350 | 917 | 937 | |||||||||||
Freddie Mac servicing fee | 181 | 155 | 395 | 314 | |||||||||||
Net OMSR income (loss) | (68) | (89) | (100) | (350) | |||||||||||
Other fees for customer services | 109 | 87 | 187 | 161 | |||||||||||
Total service charges and fees | 1,830 | 1,386 | 3,525 | 2,739 | |||||||||||
Wealth management fees | 806 | 656 | 1,502 | 1,228 | |||||||||||
Net gain on sale of mortgage loans | 375 | 466 | 1,120 | 617 | |||||||||||
Earnings on corporate owned life insurance policies | 190 | 189 | 376 | 371 | |||||||||||
Gains from redemption of corporate owned life insurance policies | 4 | 349 | 150 | 873 | |||||||||||
All other | 110 | 200 | 174 | 416 | |||||||||||
Total noninterest income | $ | 3,315 | $ | 3,246 | $ | 6,847 | $ | 6,244 | |||||||
Three Months Ended June 30 | Six Months Ended June 30 | ||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||
Compensation and benefits | $ | 5,700 | $ | 5,793 | $ | 11,577 | $ | 11,662 | |||||||
Furniture and equipment | 1,327 | 1,431 | 2,700 | 2,892 | |||||||||||
Occupancy | 915 | 912 | 1,860 | 1,779 | |||||||||||
Other | |||||||||||||||
Audit, consulting, and legal fees | 452 | 498 | 888 | 931 | |||||||||||
ATM and debit card fees | 462 | 328 | 879 | 651 | |||||||||||
Marketing costs | 238 | 265 | 447 | 468 | |||||||||||
Memberships and subscriptions | 217 | 159 | 428 | 358 | |||||||||||
Loan underwriting fees | 200 | 212 | 390 | 378 | |||||||||||
FDIC insurance premiums | 129 | 144 | 360 | 300 | |||||||||||
Director fees | 180 | 177 | 339 | 359 | |||||||||||
Donations and community relations | 108 | 105 | 254 | 435 | |||||||||||
All other | 567 | 676 | 1,190 | 1,432 | |||||||||||
Total other noninterest expenses | 2,553 | 2,564 | 5,175 | 5,312 | |||||||||||
Total noninterest expenses | $ | 10,495 | $ | 10,700 | $ | 21,312 | $ | 21,645 | |||||||
View original content:https://www.prnewswire.com/news-releases/isabella-bank-corporation-announces-strong-second-quarter-2021-earnings-301340286.html
SOURCE Isabella Bank Corporation
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