RICHMOND, Va.,
Oct. 30, 2020
/PRNewswire/ -- Community Bankers Trust
Corporation (the "Company") (NASDAQ: ESXB), the holding company for
Essex Bank (the "Bank"), today reported results for the third
quarter and first nine months of 2020.
FINANCIAL HIGHLIGHTS
- Net income was $4.5 million
for the quarter ended September 30,
2020, compared with net income of $4.2 million in the second quarter of 2020 and
net income of $4.6 million in the
third quarter of 2019.
- Net income for the first nine months of 2020 was
$10.1 million, a decrease of
$1.6 million from $11.7 million for the first nine months of 2019,
as the provision for loan losses in 2020 was $4.1 million higher than in 2019 due to the
economic uncertainties created by the coronavirus (COVID-19)
pandemic.
- Net interest income was $12.7
million for the third quarter of 2020, a linked quarter
increase of $353,000, or
2.9%.
- Interest on deposits declined $568,000 on a linked quarter basis and the
associated cost declined from 1.20% to 0.96%.
OPERATING HIGHLIGHTS
- Loans, excluding purchased credit impaired (PCI) loans,
grew $12.4 million, or 1.1%, during
the third quarter of 2020 and $119.4
million, or 11.3%, since year end 2019.
- Loans, net of fees, that the Bank originated during the
second quarter under the Paycheck Protection Program ("PPP") of the
Small Business Administration ("SBA") were $85.1 million at September
30, 2020 and $83.5 million at
June 30, 2020.
- Deposits grew $5.7 million
during the third quarter of 2020 as checking, money market and
savings accounts grew by $28.5
million and more costly certificates of deposit accounts
declined by $22.8
million.
- Checking, money market and savings accounts grew
$192.9 million during the first nine
months of 2020 while certificates of deposit increased only
$13.0 million.
- Net interest margin was 3.35% in the third quarter of
2020 compared with 3.40% in the second quarter of 2020 and 4.02% in
the third quarter of 2019. The third quarter 2019 margin, and thus,
net income, was boosted by a $1.1
million payoff within the PCI portfolio that went directly
to income.
- The Company provided COVID-19 related payment relief on
loans totaling $176.9 million during
the first and second quarters of 2020. As of September 30, 2020 payment has resumed on
$74.8 million of those loans and the
Company has re-extended such relief on $33.7
million of those loans.
MANAGEMENT COMMENTS
Rex L. Smith, III,
President and Chief Executive Officer, stated, "The underlying
fundamentals for the Bank show positive trends despite the
lingering effect of the pandemic. We continue to assist
customers with PPP loans and other means of assistance which takes
a tremendous amount of time and effort by our lending teams.
Still, we managed robust loan growth year to date and have managed
to keep credit quality strong as nonperforming assets have had
significant decreases both year to date and year over
year."
Smith added, "We are very positive about where we are and
where we are going despite the headwinds of the rate environment
and COVID issues. The margin should begin to rebound as we
have significant repricing of our certificates of deposits for the
next several quarters, which will bring decreases in our cost of
funds. That combined with the payoff of the low rate PPP
loans will have a positive impact on our net interest margin going
forward. We also continue to expand and grow our digital
banking platforms. In September, we introduced Zelle
our new real-time person to person (P2P) payment system that
is fully integrated with our internet and mobile banking
applications. Both our digital platform and Customer Service
Center continue to experience double digit growth, which
contributes to improvements in our operating
efficiency."
Smith concluded, "Because of the positive trends, it is
appropriate to reinstate our stock repurchase program. As our
capital levels are more than sufficient given the quality of the
balance sheet, we are also pleased to announce an increase in our
quarterly dividend from $0.05 to
$0.06 effective with the next
quarterly dividend."
RESULTS OF OPERATIONS
Overview
Linked Quarter Basis
Net income was $4.5 million
for the third quarter of 2020, compared with net income of
$4.2 million in the second quarter of
2020. Earnings per common share were $0.20 basic and fully diluted for the third
quarter of 2020 and $0.19 basic and
$0.18 fully diluted for the second
quarter of 2020. Comparative net income was affected by several
factors. There was no provision for loan losses in the third
quarter of 2020 compared with a provision of $900,000 in the second quarter of 2020.
Additionally, net interest income increased by $353,000 in the third quarter compared with the
second quarter of 2020. Offsetting these improvements to net income
were an increase of $653,000 in
noninterest expenses, which were impacted in the second quarter of
2020 by internal loan origination costs related to PPP loan volume,
a decrease of $144,000 in noninterest
income, due to lower securities gains, and an increase in income
tax expense of $100,000.
Details of the linked quarter financial performance of the
Company are presented below.
Year-over-Year Nine Months
Net income for the first nine months of 2020 was
$10.1 million, or $0.45 per common share, basic and fully diluted.
This is a decrease of $1.6 million,
or 13.5%, when compared with net income of $11.7 million, or $0.52 basic and diluted earnings per share, for
the first nine months of 2019. The decrease was primarily the
result of the provision for loan losses of $4.2 million for the first nine months of 2020
compared with $125,000 for the same
period in 2019. The level of provision in 2020 was recorded to
reflect the business and market disruptions arising from the
COVID-19 pandemic. Also declining on a year-over-year nine month
basis was a decrease of $233,000 in
net interest income. Offsetting these decreases to net income were
a decrease of $2.1 million in
noninterest expenses, primarily from a reduction in salaries and
employee benefits of $1.1 million,
due primarily to internal loan origination costs as noted above, an
increase of $447,000 in noninterest
income, which was driven by an increase of $484,000 in mortgage loan income, and a decrease
of $224,000 in income tax expense.
Details on the drivers of these year-over-year changes are
presented below.
Year-over-Year Third Quarter
Net income in the third quarter of 2020 decreased
$97,000 when compared to the same
period in 2019. Net income was $4.5
million in the third quarter of 2020, with earnings per
share of $0.20 basic and fully
diluted. Net income for the third quarter of 2019 was
$4.6 million, with earnings per share
of $0.21 basic and $0.20 fully diluted. The decrease in net income
was driven by a decrease of $1.9
million in interest income, primarily from a $1.1 million payoff within a loan pool in the PCI
portfolio, with no carrying value, and thus resulted in the entire
payment being recognized as interest income. Additionally,
noninterest income declined a nominal $39,000 year-over-year and income tax expense
increased by $56,000. Offsetting
these decreases to net income were a decrease of $1.2 million in interest expense and a decrease
of $704,000 in noninterest expenses.
The decrease in noninterest expenses was mainly the result of
a nonperforming loan of $4.0
million that was migrated to other real estate owned (OREO)
in the third quarter of 2019. As a part of this transaction the
Bank paid delinquent real estate taxes in the amount of
$624,000 on this property. Details of
the year-over-year financial performance of the Company are
presented below.
The following table presents summary income statements for
the three months ended September 30,
2020, June 30, 2020 and
September 30, 2019 and for the nine
months ended September 30, 2020 and
September 30, 2019.
SUMMARY INCOME STATEMENT
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended
|
|
For the nine months ended
|
|
|
30-Sep-20
|
|
30-Jun-20
|
|
30-Sep-19
|
|
30-Sep-20
|
|
30-Sep-19
|
Interest
income
|
$
|
15,549
|
$
|
15,751
|
$
|
17,460
|
$
|
47,246
|
$
|
49,172
|
Interest
expense
|
|
2,836
|
|
3,391
|
|
4,041
|
|
9,935
|
|
11,628
|
Net interest
income
|
|
12,713
|
|
12,360
|
|
13,419
|
|
37,311
|
|
37,544
|
Provision for loan
losses
|
|
-
|
|
900
|
|
-
|
|
4,200
|
|
125
|
Net interest income
after provision for loan losses
|
12,713
|
|
11,460
|
|
13,419
|
|
33,111
|
|
37,419
|
Noninterest
income
|
|
1,472
|
|
1,616
|
|
1,511
|
|
4,423
|
|
3,976
|
Noninterest
expense
|
|
8,526
|
|
7,873
|
|
9,230
|
|
24,993
|
|
27,061
|
Income before income
taxes
|
|
5,659
|
|
5,203
|
|
5,700
|
|
12,541
|
|
14,334
|
Income tax
expense
|
|
1,143
|
|
1,043
|
|
1,087
|
|
2,450
|
|
2,674
|
Net income
|
$
|
4,516
|
$
|
4,160
|
$
|
4,613
|
$
|
10,091
|
$
|
11,660
|
|
|
|
|
|
|
|
|
|
|
|
EPS Basic
|
$
|
0.20
|
$
|
0.19
|
$
|
0.21
|
$
|
0.45
|
$
|
0.52
|
EPS
Diluted
|
$
|
0.20
|
$
|
0.18
|
$
|
0.20
|
$
|
0.45
|
$
|
0.52
|
Fully Diluted share
count
|
|
22,503
|
|
22,508
|
|
22,561
|
|
22,534
|
|
22,475
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets, annualized
|
|
1.12%
|
|
1.06%
|
|
1.29%
|
|
0.87%
|
|
1.10%
|
Return on average
equity, annualized
|
|
11.04%
|
|
10.46%
|
|
12.24%
|
|
8.39%
|
|
10.71%
|
Net Interest Income
Linked Quarter Basis
Net interest income was $12.7
million for the quarter ended September 30, 2020. This was a linked quarter
increase of $353,000, or 2.9%.
Interest and dividend income on a linked quarter basis decreased
$202,000, or 1.3%, to $15.5 million for the third quarter of
2020. Interest income with respect to loans, excluding PCI
loans, decreased $252,000, or 1.9%,
during the third quarter of 2020 when compared with the second
quarter of 2020. This decline in interest and fees on loans during
the quarter was due to a decrease in the yield on loans, which
declined from 4.55% in the second quarter of 2020 to 4.33% in the
third quarter of 2020. The average balance of loans, excluding PCI
loans, increased by $23.4 million, or
2.0%, on a linked quarter basis, to $1.169
billion. The yield on loans for the third quarter of 2020
was lowered by the effects of a full quarter of loans originated
under the PPP program, which carry an interest rate of 1.00%. PPP
loans, net of fees, totaled $85.1
million at September 30, 2020
and $83.5 million at June 30, 2020. Interest income with respect to
PCI loans was $1.0 million in the
third quarter of 2020, and the corresponding yield was 13.21%. In
the second quarter of 2020 income on PCI loans was $1.1 million with a yield of 14.01%. As a result
of the aforementioned activity, the yield on all loans decreased
from 4.80% in the second quarter of 2020 to 4.55% in the third
quarter of 2020. Interest income on securities
increased $70,000 on a linked quarter
basis and was $1.7 million in the
third quarter of 2020. Interest bearing bank balances reflect an
increase of $80,000 in income
recognized for the third quarter when compared to the second
quarter of 2020.
Interest income on securities on a tax-equivalent basis
equaled $1.8 million for the third
quarter of 2020, an increase of $69,000 from the second quarter of 2020.
The tax-equivalent yield on the securities portfolio was 2.89% in
the third quarter of 2020 and 2.88% in the second quarter of 2020
based on a 21.0% income tax rate. As a result of these changes in
rate and volume, the yield on earning assets declined from 4.33% in
the second quarter of 2020 to 4.09% in the third quarter of
2020.
Interest expense of $2.8
million in the third quarter of 2020 was a decrease of
$555,000, or 16.4%, on a linked
quarter basis. Interest on deposits decreased $568,000, or 17.9%. The cost of interest bearing
deposits decreased from 1.20% in the second quarter of 2020 to
0.96% in the third quarter of 2020. This trend should continue in
the fourth quarter of 2020 as $147.3
million in certificates of deposit, or 24.1% of all
certificates, will mature. These deposits were paying a weighted
average rate of 1.52% at September 30,
2020. Interest on borrowed funds, both short term and FHLB
borrowings, increased $13,000, or
6.2%. The cost of these borrowings increased nominally, from 1.15%
in the second quarter of 2020 to 1.19% in the third quarter of
2020. The Company's cost of interest bearing liabilities of 0.97%
in the third quarter of 2020 was a decrease of 22 basis points from
the prior quarter.
With the changes in net interest income noted above, the
tax-equivalent net interest margin decreased from 3.40% in the
second quarter of 2020 to 3.35% in the third quarter of 2020. The
interest spread was 3.12% for the current quarter compared with
3.14% in the prior quarter. Excluding PPP loans from the net
interest margin calculation would have resulted in a margin of
3.39% for the third quarter of 2020 compared with the actual margin
of 3.35%. The yield on the loan portfolio would have been
4.47% excluding PPP loans versus the actual yield of 4.33% with PPP
loans, and the yield on earning assets would have been 4.18%
without PPP loans as opposed to the actual yield of 4.09% that
included PPP loans.
Year-over-Year Nine Months
Net interest income was $37.3
million for the first nine months of 2020. This is a
slight decrease of $233,000, or 0.6%,
from net interest income of $37.5
million for the first nine months of 2019. Interest and
dividend income declined by $1.9
million over this time frame. Interest and dividend income
was impacted by volume increases offset by a decline in yield.
First, there was an increase of $612,000, or 1.6%, in interest and fees on loans,
which increased as a result of growth of $111.0 million, or 10.9%, in the average balance
of loans in 2020 over 2019. The yield on loans declined from 5.03%
for the first nine months of 2019 to 4.59% for the same period in
2020. A portion of this decrease is attributable to the addition of
$85.1 million in PPP loans net of
fees during the second and third quarters of 2020 at a rate of
1.00%. Interest and fees on PCI loans declined by $1.8 million, or 36.0%. Part of this decline is
related to payoffs within charged-off loan pools within the PCI
portfolio. The yield on the PCI portfolio was 13.71% for the first
nine months of 2020 compared with 17.70% for the same period in
2019. Interest on deposits in other banks declined by $69,000. Interest and dividends on securities
declined by $699,000 in the first
nine months of 2020 compared with the same period in 2019. The
yield on earning assets was 4.38% for the first nine months of
2020, a decline of 64 basis points from 5.02% in the first nine
months of 2019. The yield on total loans, which includes PCI loans
and PPP loans, declined from 5.48% for the first nine months of
2019 to 4.83% for the same period in 2020. The return on interest
bearing bank balances declined from 2.55% to 0.66%, while the
tax-equivalent yield on the securities portfolio declined from
3.25% for the first nine months of 2019 to 2.95% for the first nine
months of 2020.
Interest expense of $9.9
million for the first nine months of 2020 was a decrease of
$1.7 million, or 14.6%, from interest
expense of $11.6 million for the
first nine months of 2019. The cost of interest bearing liabilities
decreased from 1.44% for the first nine months of 2019 to 1.17% for
the same period in 2020. Interest on deposits decreased
$1.3 million due to a decline in the
rate paid from 1.39% for the first nine months of 2019 to 1.16% for
the first nine months of 2020. Over the next 12
months, $480.7 million in
certificates of deposit, or 78.8% of total certificates, will
reprice, and these certificates were paying a weighted average rate
of 1.28% at September 30, 2020.
The average balance of interest bearing liabilities increased over
this time frame by $45.7 million.
Short term borrowing expense decreased by $60,000, and the cost of FHLB and other
borrowings decreased by $327,000, or
32.0%, as the rate paid decreased from 2.09% for the first nine
months of 2019 to 1.30% for the first nine months of
2020.
The changes noted to interest income and interest expense
led to a decline in the net interest margin from 3.84% for the
first nine months of 2019 to 3.48% for the same period in 2020. The
interest spread also declined over this time frame from 3.58% in
2019 to 3.21% in 2020. Excluding PPP loans from the net interest
margin calculation would have resulted in a margin of 3.49% for the
first nine months of 2020 compared with the actual margin of
3.48%. The yield on the loan portfolio would have been 4.68%
excluding PPP loans versus the actual yield of 4.59% with PPP
loans, and the yield on earning assets would have been 4.44%
without PPP loans as opposed to the actual yield of 4.38% that
included PPP loans.
Year-Over-Year Third Quarter
Net interest income decreased $706,000, or 5.3%, from the third
quarter of 2019 to the third quarter of 2020. Net interest income
was $12.7 million in the third
quarter of 2020 compared with $13.4
million for the same period in 2019. Interest and
dividend income decreased $1.9
million, or 10.9%, over this time period. In the third
quarter of 2019 a $1.1 million payoff
was received within a loan pool in the PCI portfolio, with no
carrying value, and thus resulted in the entire payment being
recognized as interest income. Interest and fees on loans decreased
by $427,000, or 3.2%, driven by a
decrease in rate. Interest and fees on PCI loans, affected by the
$1.1 million payoff previously noted,
decreased by $1.4 million, and was
$962,000 in the third quarter of
2020. Securities income decreased by $138,000, and interest on deposits in other banks
increased by $34,000.
The average balance of the loan portfolio, excluding PCI
loans, increased by $131.9 million,
year over year and averaged $1.169
billion for the third quarter of 2020. The PCI portfolio
declined $6.5 million during the
year-over-year comparison period. The average balance of total
earning assets increased $184.7
million, or 13.9%, from the third quarter of 2019 to the
third quarter of 2020. The yield on earning assets decreased from
5.23% in the third quarter of 2019, boosted by the $1.1 million PCI payment, to 4.09% in the third
quarter of 2020. The yield on earning assets was the culmination of
decreases in the yield on all loans, from 5.74% in the third
quarter of 2019 to 4.55% in the third quarter of 2020, in the
tax-equivalent yield on securities, from 3.17% in the third quarter
of 2019 to 2.89% in the third quarter of 2020, and in the yield on
interest bearing bank balances, from 2.58% to 0.68% year over year.
Income on interest bearing bank balances increased
$34,000 as a result of an increase of
$57.1 million in the average balance
in the third quarter of 2020 as compared with the same period
one year ago.
Interest expense decreased $1.2
million, or 29.8%, when comparing the third quarter of 2020
and the third quarter of 2019. Interest expense on deposits
decreased $1.1 million, or 29.3%, as
the cost declined from 1.45% in the third quarter of 2019 to 0.96%
for the same period in 2020. The average balance of interest
bearing deposits increased $70.0
million, or 6.9%. This growth was from non-maturity deposit
sources. First, there was an increase of $45.8 million, or 29.5%, in the average balance
of interest bearing checking, which averaged $201.0 million in the third quarter of 2020.
Additionally, there was an increase of $43.9
million in the average balance of savings and money market
accounts from the third quarter of 2019 to the same period in 2020.
Offsetting these increases was a decrease in the average balance of
time deposits of $19.8 million, to
$612.8 million for the third quarter
of 2020. FHLB and other borrowings benefited from a decrease in
cost from 1.99% in the third quarter of 2019 to 1.19% in the third
quarter of 2020. All of the above contributed to the
reduction of interest expense for interest-bearing liabilities by
$1.2 million despite an increase in
the average amount outstanding of $77.4
million. The amount of liquidity in the banking system,
along with lower interest rates and a shift in deposit balances
decreased the cost of interest bearing liabilities from 1.49% in
the third quarter of 2019 to 0.97% in the third quarter of
2020.
The tax-equivalent net interest margin decreased 67 basis
points, from 4.02% in the third quarter of 2019 to 3.35% in the
third quarter of 2020. Likewise, the interest spread decreased from
3.74% to 3.12% over the same time period. The decrease in the
margin was precipitated by a greater decrease in the yield on
earning assets of 114 basis points compared with a decline in the
cost of interest bearing liabilities of 52 basis points.
The following table compares the Company's net interest
margin, on a tax-equivalent basis, for the three months ended
September 30, 2020, June 30, 2020 and September 30, 2019 and for the nine months ended
September 30, 2020 and September 30, 2019.
NET INTEREST MARGIN
|
|
|
|
|
|
|
|
|
|
(Unaudited)
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended
|
|
|
|
30-Sep-20
|
|
|
30-Jun-20
|
|
|
30-Sep-19
|
|
Average interest
earning assets
|
$
|
1,517,374
|
|
$
|
1,468,702
|
|
$
|
1,332,698
|
|
Interest
income
|
$
|
15,549
|
|
$
|
15,751
|
|
$
|
17,460
|
|
Interest income -
tax-equivalent
|
$
|
15,641
|
|
$
|
15,844
|
|
$
|
17,555
|
|
Yield on interest
earning assets
|
|
4.09
|
%
|
|
4.33
|
%
|
|
5.23
|
%
|
Average interest
bearing liabilities
|
$
|
1,156,089
|
|
$
|
1,138,908
|
|
$
|
1,078,722
|
|
Interest
expense
|
$
|
2,836
|
|
$
|
3,391
|
|
$
|
4,041
|
|
Cost of interest
bearing liabilities
|
|
0.97
|
%
|
|
1.19
|
%
|
|
1.49
|
%
|
Net interest
income
|
$
|
12,713
|
|
$
|
12,360
|
|
$
|
13,419
|
|
Net interest income -
tax-equivalent
|
$
|
12,805
|
|
$
|
12,453
|
|
$
|
13,514
|
|
Interest
spread
|
|
3.12
|
%
|
|
3.14
|
%
|
|
3.74
|
%
|
Net interest
margin
|
|
3.35
|
%
|
|
3.40
|
%
|
|
4.02
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine months ended
|
|
|
|
|
|
30-Sep-20
|
|
|
30-Sep-19
|
|
|
|
|
Average interest
earning assets
|
$
|
1,443,925
|
|
$
|
1,318,014
|
|
|
|
|
Interest
income
|
$
|
47,246
|
|
$
|
49,172
|
|
|
|
|
Interest income -
tax-equivalent
|
$
|
47,521
|
|
$
|
49,505
|
|
|
|
|
Yield on interest
earning assets
|
|
4.38
|
%
|
|
5.02
|
%
|
|
|
|
Average interest
bearing liabilities
|
$
|
1,129,625
|
|
$
|
1,080,395
|
|
|
|
|
Interest
expense
|
$
|
9,935
|
|
$
|
11,628
|
|
|
|
|
Cost of interest
bearing liabilities
|
|
1.17
|
%
|
|
1.44
|
%
|
|
|
|
Net interest
income
|
$
|
37,311
|
|
$
|
37,544
|
|
|
|
|
Net interest income -
tax-equivalent
|
$
|
37,586
|
|
$
|
37,877
|
|
|
|
|
Interest
spread
|
|
3.21
|
%
|
|
3.58
|
%
|
|
|
|
Net interest
margin
|
|
3.48
|
%
|
|
3.84
|
%
|
|
|
|
Provision for Loan Losses
The Company records a separate provision for loan losses
for its loan portfolio, excluding PCI loans, and the PCI loan
portfolio. There was no provision for loan losses on the loan
portfolio, excluding PCI loans, in the third quarter of 2020. There
was a provision of $900,000 recorded
during the second quarter of 2020. There was no provision for
loan losses for the third quarter of 2019. For the first nine
months of 2020, there was a total provision for loan losses of
$4.2 million compared with
$125,000 for the same period in
2019.
The provisions recorded in each of the first and second
quarters of 2020 was due to the heightened risks associated with
the loan portfolio that resulted from the economic impact of the
rapidly evolving effects of the COVID-19 stay-at-home orders,
business shut-downs and increased unemployment. Lenders reviewed
each loan within the portfolio during each period to identify those
borrowers that management believed to be possibly impacted by the
current state of the economy. Loans identified with increased risk
were aggregated by loan type. This analysis indicated a risk grade
migration in a number of loan categories that led to a heightened
risk level in the loan portfolio. The impact of the loans' risk
grade migration was applied to the allowance for loan loss
calculation, which led to the provision for loan losses for each of
the first two quarters of 2020. The Company determined that no
provision was necessary for the third quarter of 2020 after a
similar analysis and review process for the quarter. The portfolio
at September 30, 2020 reflects
stabilization within the loan portfolio and appropriate coverage
ratios of the allowance to nonperforming assets.
With respect to the PCI portfolio, no provision was taken
during the third quarter of 2020, the second quarter of 2020 or the
third quarter of 2019 due to the stable nature of the portfolio's
performance and its declining balances over time as the portfolio
amortizes. Likewise, for the first nine months of 2020 and 2019
there was no provision recorded with respect to the PCI loan
portfolio. Additional discussion of loan quality is presented
below.
Noninterest Income
Linked Quarter Basis
Noninterest income was $1.5
million for the third quarter of 2020, a $144,000 decrease compared with $1.6 million for the second quarter of
2020. Gain (loss) on securities transactions, net were a gain
of $78,000 in the third quarter of
2020 compared with a gain of $242,000
in the second quarter of 2020. This is a decrease of $164,000 on a linked quarter basis. Mortgage loan
income of $228,000 was a decrease of
$145,000 on a linked quarter basis.
Offsetting these linked quarter decreases was an increase of
$86,000 in other noninterest income,
which was $382,000 in the third
quarter of 2020. The increase was attributable to a $33,000 increase in swap fee income and a
$130,000 increase in partnership
investment income. These increases were partially offset by a
decrease of $78,000 in brokerage
commission income. Also, service charges and fees increased
$81,000 on a linked quarter basis and
were $613,000 for the third quarter
of 2020.
Year-Over-Year Nine Months
Noninterest income was $4.4
million for the first nine months of 2020, an increase of
$447,000, or 11.2%, over noninterest
income of $4.0 million for the first
nine months of 2019. Mortgage loan income was $822,000 for the first nine months of 2020, an
increase of $484,000 over the same
period in 2019. This increase was created by continuity among the
mortgage team, coupled with attractive rates and increased
referrals within the Bank. Other noninterest income was
$974,000 for the first nine months of
2020, an increase of $230,000 over
the same period in 2019. The increase was primarily the result from
2020 activity that included a $64,000
gain on the extinguishment of a FHLB borrowing combined with a
$261,000 increase in swap fee income.
These items were partially offset by a decrease of $120,000 from non-recurring insurance proceeds
received in 2019. Gain on sale of loans was $11,000 for the first nine months of 2020
compared with none for the same period in 2019. Offsetting these
increases to noninterest income were a decline of $257,000 in service charges and fees, resulting
from reduced transaction volumes created by the COVID-19 pandemic
stay-at-home orders, and a decrease of $28,000 in income on bank owned life
insurance.
Year-Over-Year Third Quarter
Noninterest income of $1.5
million in the third quarter of 2020 was a decrease of
$39,000, or 2.6%, below
the third quarter of 2019. Service charges on deposit
accounts of $613,000 in the third
quarter of 2020 decreased by $145,000, or 19.1%, year over year, again due to
the effects of the COVID-19 pandemic. Income on bank owned life
insurance was $171,000 in the third
quarter of 2020, a decrease of $10,000 year over year. Offsetting these
decreases to noninterest income was an increase in mortgage loan
income, which was $228,000 in the
third quarter of 2020 compared with $176,000 in the third quarter of 2019. Other
noninterest income was $382,000 in
the third quarter of 2020 compared with $346,000 in the third quarter of 2019, an
increase of $36,000. Gains on
securities transactions of $78,000 in
the third quarter of 2020 were an increase of $28,000 compared with the same quarter in
2019.
Noninterest Expenses
Linked Quarter Basis
Noninterest expenses totaled $8.5
million for the third quarter of 2020, as compared with
$7.9 million for the second quarter
of 2020, an increase of $653,000, or
8.3%. Salaries and employee benefits in the third quarter of 2020
were $5.0 million compared with
$4.6 million in the second quarter of
2020. This is an increase of $428,000, or 9.3%, on a linked quarter basis. The
primary reasons for the increase were reductions that occurred in
the second quarter of 2020 under applicable accounting standards to
recognize the costs associated with the origination of each loan
during the quarter. This credit is netted against the
associated loan fee, and the difference is recorded as deferred
income and recognized as a yield adjustment over the life of the
individual loans. While this is routinely performed for every loan
that the Bank originates, the volume of loans booked during the
second quarter of 2020 far exceeded those of the third quarter of
2020. The $83.5 million of PPP
loans, net of fees, at June 30, 2020
constituted 741 loans booked and resulted in $559,000 in costs. A nominal amount and number of
PPP loans were originated in the third quarter of 2020, increasing
the balance of those loans to $85.1
million at September 30, 2020.
Other real estate expenses, net increased $91,000 on a linked quarter basis and were
$87,000 in the third quarter of 2020.
Data processing fees increased by $83,000 on a linked quarter basis and were
$656,000 in the third quarter of
2020. FDIC assessment increased by $18,000 on a linked quarter basis as a result of
an increase in the assessment base of average total assets minus
average tangible equity. Occupancy expenses were $815,000 in the third quarter of 2020, an
increase of $37,000 on a linked
quarter basis. Other operating expenses increased by $11,000 and were $1.4
million in the third quarter of 2020. Equipment expense of
$330,000 reflects a linked quarter
decrease of $15,000.
Year-over-Year Nine Months
Noninterest expenses were $25.0
million for the nine months ended September 30, 2020, a decrease of $2.1 million, or 7.6%, year over year. Other real
estate expenses, net were $89,000 for
the first nine months of 2020 and decreased by $573,000 versus the same period in 2019. In the
third quarter of 2019 a nonperforming loan was migrated to OREO and
as part of the process the Bank paid $624,000 in real estate taxes on the property.
Salaries and employee benefits declined $1.1
million, or 7.1%. In addition to the internal loan costs
relating to the origination of PPP loans, the closure
of two branch offices in 2019 have positively affected salaries as
well as other expense categories in 2020, namely occupancy and
equipment expenses. Occupancy expenses were $242,000 lower, equipment expenses were
$105,000 lower, and other operating
expenses decreased $230,000. FDIC
assessment was $455,000 for the first
nine months of 2020 and increased $139,000 over the same period in 2019 mainly due
to a $165,000 assessment credit
received by the FDIC in 2019. Data processing fees were
$1.8 million for the first nine
months of 2020, an increase of $80,000 when compared with the same period in
2019.
Year-Over-Year Third Quarter
Noninterest expenses were $8.5
million for the third quarter of 2020. This is a decrease of
$704,000 from noninterest expenses of
$9.2 million for the third quarter of
2019. The primary reason for the decline resulted from a decrease
in other real estate expenses, net, which were $87,000 in the third quarter of 2020 compared
with $565,000 for the same period in
2019. In addition, loan migration to OREO resulted in the Bank
paying $624,000 in real estate taxes
during the third quarter of 2019. Salaries and employee benefits
declined $248,000, or 4.7%. Also
decreasing for the period were other operating expenses, which
decreased $165,000, and equipment
expense, which was $47,000 lower.
Offsetting these decreases were increases of $170,000 in FDIC assessment, which was
$174,000 in the third quarter of
2020, and $62,000 in data processing
expenses, which were $656,000 in the
third quarter of 2020.
The following table compares the Company's other operating
expenses included in noninterest expenses for the three months
ended September 30, 2020,
June 30, 2020, March 31, 2020, December
31, 2019 and September 30,
2019.
OTHER OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
(Dollars in
thousands)
|
For the three months ended
|
|
|
30-Sep-20
|
|
30-Jun-20
|
|
31-Mar-20
|
|
31-Dec-19
|
|
30-Sep-19
|
Bank franchise
tax
|
$
|
237
|
$
|
237
|
$
|
237
|
$
|
220
|
$
|
220
|
Stationery,
printing and supplies
|
|
167
|
|
185
|
|
169
|
|
155
|
|
152
|
Marketing
expense
|
|
79
|
|
111
|
|
96
|
|
89
|
|
117
|
Credit
expense
|
|
71
|
|
162
|
|
178
|
|
86
|
|
229
|
Outside vendor
fees
|
|
177
|
|
190
|
|
237
|
|
223
|
|
152
|
Other
expenses
|
|
692
|
|
527
|
|
603
|
|
668
|
|
718
|
Total other operating
expenses
|
$
|
1,423
|
$
|
1,412
|
$
|
1,520
|
$
|
1,441
|
$
|
1,588
|
Income Taxes
Income tax expense was $1.1
million for the third quarter of 2020, compared with income
tax expense of $1.0 million and
$1.1 million for the second quarter
of 2020 and third quarter of 2019, respectively. For the first nine
months of 2020, income tax expense was $2.5
million compared with $2.7
million for the first nine months of 2019. The effective tax
rate for the third quarter of 2020 was 20.2% compared with 20.0% in
the second quarter of 2020 and 19.1% for the third quarter of 2019.
For the first nine months of 2020, the effective tax rate was 19.5%
compared with 18.7% for the same period in 2019. The increase in
the effective tax rate in 2020 compared with 2019 is the result of
a lower level of tax-free municipal bond interest
income.
FINANCIAL CONDITION
Total assets increased $191.4
million, or 13.4%, to $1.622
billion at September 30, 2020
when compared to December 31,
2019. Total loans, excluding PCI loans, were $1.178 billion at September 30, 2020, increasing $119.4 million, or 11.3%, from year end 2019.
Since September 30, 2019, total
loans, excluding PCI loans, grew $143.2
million, or 13.8%. Total PCI loans were $27.1 million at September
30, 2020 versus $32.5 million
at December 31, 2019.
The Company provided COVID-19 related payment relief on
loans totaling $176.9 million during
the first and second quarters of 2020. PCI loans comprised
$12.8 million of this total. As of
September 30, 2020, payment has
resumed on $74.8 million of these
loans, of which PCI comprised $1.7
million. The Company re-extended this payment relief on
$33.7 million of these loans, none of
which were within the PCI portfolio.
Loans net of fees that the Bank originated under the PPP
grew $1.6 million during the third
quarter and were $85.1 million at
September 30, 2020. There were PPP
loans of $83.5 million outstanding at
June 30, 2020. All of these balances
are included in commercial loans. As a result of the economic
conditions that existed during the second and third quarters of
2020, commercial loans, excluding PPP loans, declined by
$18.9 million from December 31, 2019. Commercial loan balances,
excluding PPP balances, declined by $7.2
million during the third quarter of 2020. Commercial real
estate loans, the largest category of loans at $452.7 million, or 38.4% of gross loans
outstanding, increased $8.8 million,
or 2.0%, during the third quarter of 2020. This category has
increased $55.8 million, or 14.1%,
year to date and $59.6 million, or
15.2%, year over year. Construction and land development loans,
totaling $159.8 million, grew by
$8.2 million, or 5.4%, during the
third quarter of 2020 and by $13.2
million since year end 2019 and $28.8
million, or 22.0%, since September
30, 2019. Residential 1 – 4 family loans declined during the
third quarter of 2020 by $1.4 million
and ended the period at $204.4
million, or 17.4% of the portfolio. This category declined
by $19.2 million during the first
nine months of 2020 and $17.6 million
since September 30, 2019.
The following table shows the composition of the Company's
loan portfolio, excluding PCI loans, at September 30, 2020, June
30, 2020, December 31, 2019
and September 30, 2019.
LOANS (excluding PCI loans)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
30-Sep-20
|
|
30-Jun-20
|
|
31-Dec-19
|
|
30-Sep-19
|
|
|
|
|
Amount
|
% of Loans
|
|
|
Amount
|
% of Loans
|
|
|
Amount
|
% of Loans
|
|
|
Amount
|
% of Loans
|
|
Mortgage loans on
real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential 1-4
family
|
$
|
204,366
|
17.35
|
%
|
$
|
205,787
|
17.66
|
%
|
$
|
223,538
|
21.12
|
%
|
$
|
222,003
|
21.46
|
%
|
|
Commercial
|
|
452,677
|
38.44
|
|
|
443,923
|
38.09
|
|
|
396,858
|
37.50
|
|
|
393,064
|
38.00
|
|
|
Construction and land
development
|
|
159,766
|
13.57
|
|
|
151,529
|
13.00
|
|
|
146,566
|
13.85
|
|
|
130,977
|
12.66
|
|
|
Second
mortgages
|
|
6,488
|
0.55
|
|
|
6,136
|
0.53
|
|
|
6,639
|
0.63
|
|
|
6,384
|
0.62
|
|
|
Multifamily
|
|
77,787
|
6.60
|
|
|
76,587
|
6.57
|
|
|
72,978
|
6.90
|
|
|
73,774
|
7.13
|
|
|
Agriculture
|
|
7,138
|
0.61
|
|
|
7,122
|
0.61
|
|
|
8,346
|
0.79
|
|
|
9,457
|
0.91
|
|
|
Total real estate
loans
|
|
908,222
|
77.12
|
|
|
891,084
|
76.46
|
|
|
854,925
|
80.79
|
|
|
835,659
|
80.78
|
|
Commercial
loans
|
|
257,362
|
21.85
|
|
|
262,955
|
22.57
|
|
|
191,183
|
18.06
|
|
|
185,999
|
17.98
|
|
Consumer installment
loans
|
|
10,606
|
0.90
|
|
|
10,257
|
0.88
|
|
|
11,163
|
1.05
|
|
|
11,883
|
1.15
|
|
All other
loans
|
|
1,519
|
0.13
|
|
|
1,014
|
0.09
|
|
|
1,052
|
0.10
|
|
|
981
|
0.09
|
|
|
Gross
loans
|
|
1,177,709
|
100.00
|
%
|
|
1,165,310
|
100.00
|
%
|
|
1,058,323
|
100.00
|
%
|
|
1,034,522
|
100.00
|
%
|
Allowance for loan
losses
|
|
(12,328)
|
|
|
|
(12,238)
|
|
|
|
(8,429)
|
|
|
|
(8,393)
|
|
|
Loans, net of
unearned income
|
$
|
1,165,381
|
|
|
$
|
1,153,072
|
|
|
$
|
1,049,894
|
|
|
$
|
1,026,129
|
|
|
The Company's securities portfolio, excluding restricted
equity securities, increased $34.0
million since year end 2019 to $256.7
million at September 30, 2020.
U.S. Treasury issues increased by $12.5
million during the first nine months of 2020 as excess
liquidity was invested short-term in very liquid and low risk
instruments. Corporate securities with balances, at fair value, of
$25.9 million at September 30, 2020, increased by $19.8 million during the nine month period.
State, county and municipal securities, the largest investment
category at $139.6 million at
September 30, 2020, increased by
$15.2 million during the first nine
months of 2020. Asset backed securities, consisting of student loan
pools 97% guaranteed by the U.S. Government, increased by
$17.4 million during the first nine
months of 2020 and totaled $29.0
million at September 30, 2020.
Offsetting these increases was a decrease of $18.8 million in mortgage backed securities and a
decline of $12.2 million in balances
held in U.S. Government agency bonds. The Company actively manages
the portfolio to improve its liquidity and maximize the return
within the desired risk profile.
The Company had cash and cash equivalents of $75.5 million at September
30, 2020 compared with $28.7
million at year end 2019, an increase of $46.8 million. The majority of this category
growth occurred in interest bearing bank balances, $45.1 million during the nine months ended
September 30, 2020, as large amounts
of liquidity have been funneled into the banking system through the
facilitation of SBA PPP loans by the banking industry and
stimulus checks issued by the U.S. Treasury under the Coronavirus
Aid, Relief, and Economic Security Act (the "CARES Act").
The following table shows the composition of the Company's
securities portfolio, excluding equity securities, restricted, at
September 30, 2020, December 31, 2019 and September 30, 2019.
SECURITIES PORTFOLIO
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
(Dollars in
thousands)
|
|
30-Sep-20
|
|
31-Dec-19
|
|
30-Sep-19
|
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
Securities Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury
issue
|
$
|
12,500
|
$
|
12,500
|
$
|
-
|
$
|
-
|
$
|
7,991
|
$
|
7,957
|
U.S. Government
agencies
|
|
19,942
|
|
19,745
|
|
22,104
|
|
21,936
|
|
23,098
|
|
22,955
|
State, county, and
municipal
|
|
109,976
|
|
116,534
|
|
95,467
|
|
98,592
|
|
90,806
|
|
94,670
|
Mortgage backed
securities
|
|
28,086
|
|
29,951
|
|
48,045
|
|
48,740
|
|
46,798
|
|
47,794
|
Asset backed
securities
|
|
28,748
|
|
28,986
|
|
11,637
|
|
11,604
|
|
10,703
|
|
10,708
|
Corporate
|
|
25,454
|
|
25,937
|
|
6,016
|
|
6,097
|
|
6,011
|
|
6,075
|
Total securities
available for sale
|
$
|
224,706
|
$
|
233,653
|
$
|
183,269
|
$
|
186,969
|
$
|
185,407
|
$
|
190,159
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30-Sep-20
|
|
31-Dec-19
|
|
30-Sep-19
|
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
Securities Held to Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Government
agencies
|
$
|
-
|
$
|
-
|
$
|
10,000
|
$
|
9,988
|
$
|
10,000
|
$
|
9,964
|
State, county, and
municipal
|
|
23,026
|
|
24,118
|
|
25,733
|
|
26,645
|
|
28,213
|
|
29,167
|
Total securities held
to maturity
|
$
|
23,026
|
|
24,118
|
$
|
35,733
|
|
36,633
|
$
|
38,213
|
|
39,131
|
Interest bearing deposits at September 30, 2020 were $1.088 billion, an increase of $102.8 million, or 10.4%, from December 31, 2019. Interest bearing checking
accounts (formerly NOW accounts) of $201.1
million grew by $5.7 million,
or 2.9%, during the third quarter of 2020 and grew $30.6 million, or 17.9%, since year end 2019 and
$53.5 million, or 36.2%, since
September 30, 2019. Money market
deposit accounts were $158.6 million
at September 30, 2020 and grew
$10.5 million, or 7.1%, during the
third quarter of 2020 and $37.7
million, or 31.2%, during the first nine months of 2020.
Savings accounts totaled $118.0
million at September 30, 2020
and grew $9.4 million during the
third quarter and $21.4 million for
the first nine months of 2020. Strong growth in these non-maturity
categories for both the quarter and year has allowed the Bank to
react to lower interest rates through proactive repricing in
certificates of deposit, the highest costing deposit
category. As a result, there has been tepid growth in time
deposits over $250,000, which grew by
$1.4 million in the third quarter of
2020. Time deposits less than or equal to $250,000 declined $24.2
million in the third quarter of 2020. Time deposit
balances combined were 56.1% of interest bearing deposits at
September 30, 2020, a decline from
60.6% at December 31, 2019. The
growth in interest bearing checking accounts, money market accounts
and savings accounts, as well as in noninterest bearing deposits,
was $192.9 million during the first
nine months of 2020. A portion of this growth was associated with
the $85.1 million in PPP loans
originated and held at September 30,
2020 and stimulus checks issued under the CARES Act, as well
as previously postponed business activity that resulted from the
COVID-19 stay-at-home orders. Certificates of deposit in relation
to total deposits declined from 51.3% at December 31, 2019 to 44.5% at September 30, 2020.
The following table compares the mix of interest bearing
deposits at September 30, 2020,
June 30, 2020, December 31, 2019 and September 30, 2019.
INTEREST BEARING DEPOSITS
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
30-Sep-20
|
|
30-Jun-20
|
|
31-Dec-19
|
|
30-Sep-20
|
Interest Bearing
Checking (formerly NOW)
|
$
|
201,121
|
|
195,441
|
$
|
-
|
$
|
-
|
NOW
|
|
-
|
|
-
|
|
170,532
|
|
147,639
|
MMDA
|
|
158,569
|
|
148,050
|
|
120,841
|
|
130,263
|
Savings
|
|
118,007
|
|
108,602
|
|
96,570
|
|
96,388
|
Time deposits less
than or equal to $250,000
|
|
468,549
|
|
492,749
|
|
477,461
|
|
483,745
|
Time deposits over
$250,000
|
|
141,417
|
|
140,027
|
|
119,460
|
|
136,206
|
Total interest
bearing deposits
|
$
|
1,087,663
|
$
|
1,084,869
|
$
|
984,864
|
$
|
994,241
|
FHLB borrowings were $68.0
million at September 30, 2020,
compared with $68.5 million at
December 31, 2019. The stable level
of FHLB borrowings during 2020 has been due to the FHLB swiftly
responding to the March 16, 2020 rate
cut of 1.50% to the discount rate by repricing advances downward to
ensure low cost liquidity for the banking system. As a result, the
Bank has found this level of borrowing to be a stable source of low
cost funding. There were Federal funds purchased of $940,000 at September 30,
2020, down from $24.4 million
at December 31, 2019.
Shareholders' equity was $165.8
million at September 30, 2020,
or 10.2% of total assets, compared with $155.5 million, or 10.9% of total assets, at
December 31, 2019.
Shareholders' equity at September 30,
2019 was $152.6 million, or
10.7% of total assets. On January 22,
2020, the Company announced a share repurchase program of up
to 1,000,000 shares of its common stock. During the first nine
months of 2020, the Company repurchased 130,800 shares of common
stock at a total cost of $885,665.
Asset Quality – excluding PCI
loans
Nonperforming loans were $4.2
million at September 30, 2020,
a decrease of $2.0 million from
$6.2 million at December 31,
2019. Total non-performing assets totaled $8.6 million at September
30, 2020 compared with $10.8
million at December 31, 2019.
This is a decrease of 19.8% during 2020. There were net recoveries
of $90,000 in the third quarter of
2020 compared with net charge-offs of $481,000 in the second quarter of 2020. For the
first nine months of 2020, net charge-offs totaled $301,000. For the third quarter of 2019,
net charge-offs were $426,000.
The allowance for loan losses equaled 292.6% of nonaccrual
loans at September 30, 2020 compared
with 289.7% at June 30, 2020, 159.3%
at December 31, 2019 and 146.1% at
September 30, 2019. The ratio of
nonperforming assets to loans and other real estate owned (OREO)
was 0.73% at September 30, 2020,
0.74% at June 30, 2020, 0.89% at
March 31, 2020, 1.01% at December 31, 2019 and 1.01% at September 30, 2019.
The allowance for loan losses to total loans was 1.05% at
both September 30, 2020 and
June 30, 2020 compared with 1.10% at
March 31, 2020, 0.80% at December 31, 2019 and 0.81% at September 30, 2019. The volume of PPP loans
originated during the second and third quarters has impacted the
ratio. The $85.1 million in PPP
loans net of fees outstanding at September
30, 2020 are fully guaranteed by the SBA in accordance with
the CARES Act; therefore, no allowance is required. The Company
monitors and adjusts the allowance for loan losses based on loans
requiring a reserve. The allowance for loan losses to total
loans excluding the PPP loans would have reflected a level of
coverage of 1.13%. at September 30,
2020.
The following table reconciles the activity in the
Company's allowance for loan losses, by quarter, for the past five
quarters.
ALLOWANCE FOR LOAN LOSSES
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
2020
|
|
2019
|
|
|
Third
|
|
Second
|
|
First
|
|
|
Fourth
|
|
Third
|
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
|
Quarter
|
|
Quarter
|
Allowance for loan
losses:
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of
period
|
$
|
12,238
|
$
|
11,819
|
$
|
8,429
|
|
$
|
8,393
|
$
|
8,819
|
Provision for loan
losses
|
|
-
|
|
900
|
|
3,300
|
|
|
200
|
|
-
|
Net (charge-offs)
recoveries
|
|
90
|
|
(481)
|
|
90
|
|
|
(164)
|
|
(426)
|
End of
period
|
$
|
12,328
|
$
|
12,238
|
$
|
11,819
|
|
$
|
8,429
|
$
|
8,393
|
The following table sets forth selected asset quality
data, excluding PCI loans, and ratios for the dates
indicated.
ASSET QUALITY (excluding PCI
loans)
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
2020
|
|
2019
|
|
|
|
30-Sep-20
|
|
30-Jun-20
|
|
31-Mar-20
|
|
|
31-Dec-19
|
|
30-Sep-19
|
|
Nonaccrual
loans
|
$
|
4,214
|
$
|
4,225
|
$
|
5,172
|
|
$
|
5,292
|
$
|
5,746
|
|
Loans past due 90
days and accruing interest
|
|
-
|
|
-
|
|
-
|
|
|
946
|
|
-
|
|
Total nonperforming
loans
|
|
4,214
|
|
4,225
|
|
5,172
|
|
|
6,238
|
|
5,746
|
|
Other real estate
owned
|
|
4,416
|
|
4,486
|
|
4,506
|
|
|
4,527
|
|
4,740
|
|
Total nonperforming
assets
|
$
|
8,630
|
$
|
8,711
|
$
|
9,678
|
|
$
|
10,765
|
$
|
10,486
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses to loans
|
|
1.05
|
%
|
1.05
|
%
|
1.10
|
%
|
|
0.80
|
%
|
0.81
|
%
|
Allowance for loan
losses to nonaccrual loans
|
|
292.55
|
|
289.66
|
|
228.52
|
|
|
159.28
|
|
146.10
|
|
Nonperforming assets
to loans and other real estate
|
|
0.73
|
|
0.74
|
|
0.89
|
|
|
1.01
|
|
1.01
|
|
Net
charge-offs/(recoveries) for quarter to average loans,
annualized
|
|
(0.03)
|
%
|
0.17
|
%
|
(0.03)
|
%
|
|
0.06
|
%
|
0.16
|
%
|
A further breakout of nonaccrual loans, excluding PCI
loans, at September 30, 2020,
December 31, 2019 and September 30, 2019 is below.
NONACCRUAL LOANS (excluding PCI
loans)
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
30-Sep-20
|
|
31-Dec-19
|
|
30-Sep-19
|
Mortgage loans on
real estate:
|
|
|
|
|
|
|
|
|
|
|
Residential 1-4
family
|
|
$
|
1,338
|
|
$
|
1,378
|
|
$
|
1,349
|
|
Commercial
|
|
|
764
|
|
|
1,006
|
|
|
1,059
|
|
Construction and land
development
|
|
|
572
|
|
|
376
|
|
|
406
|
|
Multifamily
|
|
|
-
|
|
|
2,463
|
|
|
-
|
|
Agriculture
|
|
|
51
|
|
|
-
|
|
|
2494
|
|
Total real estate
loans
|
|
$
|
2,725
|
|
$
|
5,223
|
|
$
|
5,308
|
Commercial
loans
|
|
|
1,470
|
|
|
62
|
|
|
431
|
Consumer installment
loans
|
|
|
19
|
|
|
7
|
|
|
7
|
|
Gross
loans
|
|
$
|
4,214
|
|
$
|
5,292
|
|
$
|
5,746
|
Capital Requirements
The Bank's ratio of total risk-based capital was
13.9% at September 30, 2020 compared
with 13.9% at December 31,
2019. The tier 1 risk-based capital ratio was 12.9% at
September 30, 2020 and 13.2% at
December 31, 2019. The Bank's tier 1
leverage ratio was 10.2% at September 30,
2020 and 11.0% at December 31,
2019. All capital ratios exceed regulatory minimums to
be considered well capitalized. BASEL III introduced the common equity tier 1
capital ratio, which was 12.9% at September
30, 2020 and 13.2% at December 31,
2019.
Earnings Conference Call and Webcast
The Company will host a conference call for interested
parties on Friday, October 30, 2020, at 10:00 a.m. Eastern Time to discuss the financial
results for the third quarter of 2020. The public is invited to
listen to this conference call by dialing 866-374-8379 at
least five minutes prior to the call. Interested parties may
also listen to this conference call through the internet by
accessing the "Corporate Overview – Corporate Profile" page of the
Company's internet site at
www.cbtrustcorp.com.
A replay of the conference call will be available from
12:00 noon Eastern Time on
October 30, 2020, until 9:00 a.m. Eastern Time on November 20, 2020. The replay will be available
by dialing 877-344-7529 and entering access code 10149464 or
through the internet by accessing the "Corporate Overview –
Corporate Profile" page of the Company's internet site at
www.cbtrustcorp.com.
About Community Bankers Trust Corporation and Essex
Bank
Community Bankers Trust Corporation is the holding company
for Essex Bank, a Virginia state
bank with 24 full-service offices, 18 of which are in Virginia and six of which are in
Maryland. The Bank also operates two loan production
offices.
Additional information on the Bank is available on the
Bank's website at www.essexbank.com. For
information on Community Bankers Trust Corporation, please visit
its website at
www.cbtrustcorp.com.
Forward-Looking Statements
This release contains forward-looking statements, within
the meaning of the Private Securities Litigation Reform Act of
1995, that are subject to risks and uncertainties. These
forward-looking statements include, without limitation, statements
with respect to the Company's operations, performance, future
strategy and goals. Actual results may differ materially from those
included in the forward-looking statements due to a number of
factors, including, without limitation, the effects of and changes
in the following: the quality or composition of the Company's loan
or investment portfolios, including collateral values and the
repayment abilities of borrowers and issuers; assumptions
that underlie the Company's allowance for loan losses; general
economic and market conditions, either nationally or in the
Company's market areas; unusual and infrequently occurring events,
such as weather-related disasters, terrorist acts or public health
events (such as the current COVID-19 pandemic), and of governmental
and societal responses to them; the interest rate environment;
competitive pressures among banks and financial institutions or
from companies outside the banking industry; real estate values;
the demand for deposit, loan and investment products and other
financial services; the demand, development and acceptance of new
products and services; the performance of vendors or other parties
with which the Company does business; time and costs associated
with de novo branching, acquisitions, dispositions and similar
transactions; the realization of gains and expense savings from
acquisitions, dispositions and similar transactions; consumer
profiles and spending and savings habits; levels of fraud in the
banking industry; the level of attempted cyber-attacks in the
banking industry; the securities and credit markets; costs
associated with the integration of banking and other internal
operations; the soundness of other financial institutions with
which the Company does business; inflation; technology; and
legislative and regulatory requirements. Many of these
factors and additional risks and uncertainties are described in the
Company's Annual Report on Form 10-K for the year ended
December 31, 2019 and other reports
filed from time to time by the Company with the Securities and
Exchange Commission. This press release speaks only as of its date,
and the Company disclaims any duty to update the information in
it.
COMMUNITY BANKERS TRUST
CORPORATION
|
|
|
|
|
|
|
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
UNAUDITED
|
|
|
|
|
|
|
(Dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
30-Sep-20
|
|
31-Dec-19
|
|
30-Sep-19
|
Assets
|
|
|
|
|
|
|
Cash and due from
banks
|
$
|
18,689
|
$
|
16,976
|
$
|
23,056
|
Interest bearing bank
deposits
|
|
56,795
|
|
11,708
|
|
13,742
|
|
|
|
|
|
|
|
Total cash and cash equivalents
|
|
75,484
|
|
28,684
|
|
36,798
|
|
|
|
|
|
|
|
Securities available
for sale, at fair value
|
|
233,653
|
|
186,969
|
|
190,159
|
Securities held to
maturity, at cost
|
|
23,026
|
|
35,733
|
|
38,213
|
Equity securities,
restricted, at cost
|
|
8,875
|
|
8,855
|
|
8,929
|
Total securities
|
|
265,554
|
|
231,557
|
|
237,301
|
|
|
|
|
|
|
|
Loans held for
resale
|
|
1,151
|
|
501
|
|
-
|
|
|
|
|
|
|
|
Loans
|
|
1,177,709
|
|
1,058,323
|
|
1,034,522
|
Purchased credit
impaired (PCI) loans
|
|
27,146
|
|
32,528
|
|
33,958
|
Allowance for loan
losses
|
|
(12,328)
|
|
(8,429)
|
|
(8,393)
|
Allowance for loan
losses – PCI loans
|
|
(156)
|
|
(156)
|
|
(156)
|
Net loans
|
|
1,192,371
|
|
1,082,266
|
|
1,059,931
|
|
|
|
|
|
|
|
Bank premises and
equipment, net
|
|
28,197
|
|
29,472
|
|
29,713
|
Bank premises and
equipment held for sale
|
|
1,589
|
|
1,589
|
|
1,589
|
Right-of-use leased
assets
|
|
5,766
|
|
6,472
|
|
6,709
|
Other real estate
owned
|
|
4,416
|
|
4,527
|
|
4,740
|
Bank owned life
insurance
|
|
29,858
|
|
29,340
|
|
29,161
|
Other
assets
|
|
17,851
|
|
16,432
|
|
16,739
|
Total assets
|
$
|
1,622,237
|
$
|
1,430,840
|
$
|
1,422,681
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
Noninterest
bearing
|
$
|
281,679
|
$
|
178,584
|
$
|
183,000
|
Interest
bearing
|
|
1,087,663
|
|
984,864
|
|
994,241
|
Total deposits
|
|
1,369,342
|
|
1,163,448
|
|
1,177,241
|
|
|
|
|
|
|
|
Federal funds
purchased
|
|
940
|
|
24,437
|
|
71
|
Federal Home Loan
Bank borrowings
|
|
68,000
|
|
68,500
|
|
73,667
|
Trust preferred
capital notes
|
|
4,124
|
|
4,124
|
|
4,124
|
Lease
liabilities
|
|
6,027
|
|
6,737
|
|
6,967
|
Other
liabilities
|
|
8,014
|
|
8,115
|
|
7,973
|
Total liabilities
|
|
1,456,447
|
|
1,275,361
|
|
1,270,043
|
|
|
|
|
|
|
|
Shareholders' Equity
|
|
|
|
|
|
|
Common stock
(200,000,000 shares authorized $0.01 par value; 22,321,000,
22,422,621, and 22,335,411 shares issued and outstanding,
respectively)
|
|
223
|
|
224
|
|
223
|
Additional paid in
capital
|
|
150,708
|
|
150,728
|
|
150,264
|
Retained earnings
(deficit)
|
|
9,300
|
|
2,562
|
|
(586)
|
Accumulated other
comprehensive income
|
|
5,559
|
|
1,965
|
|
2,737
|
Total shareholders' equity
|
|
165,790
|
|
155,479
|
|
152,638
|
Total liabilities and shareholders'
equity
|
$
|
1,622,237
|
$
|
1,430,840
|
$
|
1,422,681
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMUNITY BANKERS TRUST
CORPORATION
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF
INCOME
|
|
|
|
|
|
|
|
|
UNAUDITED
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
YTD
|
|
Three months ended
|
|
YTD
|
|
Three months ended
|
|
2020
|
|
30-Sep-20
|
30-Jun-20
|
|
2019
|
|
30-Sep-19
|
30-Jun-19
|
Interest and dividend income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
$
|
38,858
|
|
$
|
12,760
|
$
|
13,012
|
|
$
|
38,246
|
|
$
|
13,187
|
$
|
12,640
|
Interest and fees on
PCI loans
|
|
3,121
|
|
|
962
|
|
1,062
|
|
|
4,877
|
|
|
2,333
|
|
1,251
|
Interest on federal
funds sold
|
|
-
|
|
|
-
|
|
-
|
|
|
14
|
|
|
9
|
|
5
|
Interest on deposits
in other banks
|
|
231
|
|
|
121
|
|
41
|
|
|
300
|
|
|
87
|
|
117
|
Interest and
dividends on securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
|
|
4,000
|
|
|
1,362
|
|
1,287
|
|
|
4,483
|
|
|
1,489
|
|
1,472
|
Nontaxable
|
|
1,036
|
|
|
344
|
|
349
|
|
|
1,252
|
|
|
355
|
|
421
|
Total interest and dividend
income
|
|
47,246
|
|
|
15,549
|
|
15,751
|
|
|
49,172
|
|
|
17,460
|
|
15,906
|
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
9,215
|
|
|
2,614
|
|
3,182
|
|
|
10,521
|
|
|
3,698
|
|
3,589
|
Interest on borrowed
funds
|
|
720
|
|
|
222
|
|
209
|
|
|
1,107
|
|
|
343
|
|
317
|
Total interest expense
|
|
9,935
|
|
|
2,836
|
|
3,391
|
|
|
11,628
|
|
|
4,041
|
|
3,906
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
|
|
37,311
|
|
|
12,713
|
|
12,360
|
|
|
37,544
|
|
|
13,419
|
|
12,000
|
Provision for loan losses
|
|
4,200
|
|
|
-
|
|
900
|
|
|
125
|
|
|
-
|
|
125
|
Net interest income after provision for loan
losses
|
|
33,111
|
|
|
12,713
|
|
11,460
|
|
|
37,419
|
|
|
13,419
|
|
11,875
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service charges and
fees
|
|
1,817
|
|
|
613
|
|
532
|
|
|
2,074
|
|
|
758
|
|
707
|
Gain on
securities transactions, net
|
|
281
|
|
|
78
|
|
242
|
|
|
274
|
|
|
50
|
|
238
|
Gain on sale of
loans
|
|
11
|
|
|
-
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
Income on bank owned
life insurance
|
|
518
|
|
|
171
|
|
173
|
|
|
546
|
|
|
181
|
|
184
|
Mortgage loan
income
|
|
822
|
|
|
228
|
|
373
|
|
|
338
|
|
|
176
|
|
100
|
Other
|
|
974
|
|
|
382
|
|
296
|
|
|
744
|
|
|
346
|
|
222
|
Total noninterest income
|
|
4,423
|
|
|
1,472
|
|
1,616
|
|
|
3,976
|
|
|
1,511
|
|
1,451
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
14,806
|
|
|
5,041
|
|
4,613
|
|
|
15,943
|
|
|
5,289
|
|
5,273
|
Occupancy
expenses
|
|
2,420
|
|
|
815
|
|
778
|
|
|
2,662
|
|
|
813
|
|
919
|
Equipment
expenses
|
|
1,047
|
|
|
330
|
|
345
|
|
|
1,152
|
|
|
377
|
|
394
|
FDIC
assessment
|
|
455
|
|
|
174
|
|
156
|
|
|
316
|
|
|
4
|
|
162
|
Data processing
fees
|
|
1,821
|
|
|
656
|
|
573
|
|
|
1,741
|
|
|
594
|
|
579
|
Other real estate
expenses, net
|
|
89
|
|
|
87
|
|
(4)
|
|
|
662
|
|
|
565
|
|
105
|
Other operating
expenses
|
|
4,355
|
|
|
1,423
|
|
1,412
|
|
|
4,585
|
|
|
1,588
|
|
1,559
|
Total noninterest expense
|
|
24,993
|
|
|
8,526
|
|
7,873
|
|
|
27,061
|
|
|
9,230
|
|
8,991
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
12,541
|
|
|
5,659
|
|
5,203
|
|
|
14,334
|
|
|
5,700
|
|
4,335
|
Income tax
expense
|
|
2,450
|
|
|
1,143
|
|
1,043
|
|
|
2,674
|
|
|
1,087
|
|
791
|
Net income
|
$
|
10,091
|
|
$
|
4,516
|
$
|
4,160
|
|
$
|
11,660
|
|
$
|
4,613
|
$
|
3,544
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMUNITY BANKERS TRUST
CORPORATION
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF
INCOME
|
|
|
|
|
|
|
|
|
|
|
UNAUDITED
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
Three months ended
|
|
|
30-Sep-20
|
|
30-Jun-20
|
|
31-Mar-20
|
|
31-Dec-19
|
|
30-Sep-19
|
Interest and dividend income
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
$
|
12,760
|
$
|
13,012
|
$
|
13,086
|
$
|
13,305
|
$
|
13,187
|
Interest and fees on
PCI loans
|
|
962
|
|
1,062
|
|
1,097
|
|
1,165
|
|
2,333
|
Interest on federal
funds sold
|
|
-
|
|
-
|
|
-
|
|
-
|
|
9
|
Interest on deposits
in other banks
|
|
121
|
|
41
|
|
69
|
|
91
|
|
87
|
Interest and
dividends on securities
|
|
|
|
|
|
|
|
|
|
|
Taxable
|
|
1,362
|
|
1,287
|
|
1,351
|
|
1,387
|
|
1,489
|
Nontaxable
|
|
344
|
|
349
|
|
343
|
|
329
|
|
355
|
Total interest and dividend
income
|
|
15,549
|
|
15,751
|
|
15,946
|
|
16,277
|
|
17,460
|
Interest expense
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
2,614
|
|
3,182
|
|
3,419
|
|
3,515
|
|
3,698
|
Interest on borrowed
funds
|
|
222
|
|
209
|
|
289
|
|
349
|
|
343
|
Total interest expense
|
|
2,836
|
|
3,391
|
|
3,708
|
|
3,864
|
|
4,041
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
|
|
12,713
|
|
12,360
|
|
12,238
|
|
12,413
|
|
13,419
|
Provision for loan losses
|
|
-
|
|
900
|
|
3,300
|
|
200
|
|
-
|
Net interest income after provision for loan
losses
|
|
12,713
|
|
11,460
|
|
8,938
|
|
12,213
|
|
13,419
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest income
|
|
|
|
|
|
|
|
|
|
|
Service charges and
fees
|
|
613
|
|
532
|
|
672
|
|
757
|
|
758
|
Gain (loss) on
securities transactions, net
|
|
78
|
|
242
|
|
(39)
|
|
(39)
|
|
50
|
Gain on sale of
loans
|
|
-
|
|
-
|
|
11
|
|
14
|
|
-
|
Income on bank owned
life insurance
|
|
171
|
|
173
|
|
174
|
|
178
|
|
181
|
Mortgage loan
income
|
|
228
|
|
373
|
|
221
|
|
148
|
|
176
|
Other
|
|
382
|
|
296
|
|
296
|
|
320
|
|
346
|
Total noninterest income
|
|
1,472
|
|
1,616
|
|
1,335
|
|
1,378
|
|
1,511
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
5,041
|
|
4,613
|
|
5,152
|
|
5,480
|
|
5,289
|
Occupancy
expenses
|
|
815
|
|
778
|
|
827
|
|
791
|
|
813
|
Equipment
expenses
|
|
330
|
|
345
|
|
372
|
|
332
|
|
377
|
FDIC
assessment
|
|
174
|
|
156
|
|
125
|
|
(20)
|
|
4
|
Data processing
fees
|
|
656
|
|
573
|
|
592
|
|
588
|
|
594
|
Other real estate
expenses, net
|
|
87
|
|
(4)
|
|
6
|
|
56
|
|
565
|
Other operating
expenses
|
|
1,423
|
|
1,412
|
|
1,520
|
|
1,441
|
|
1,588
|
Total noninterest expense
|
|
8,526
|
|
7,873
|
|
8,594
|
|
8,668
|
|
9,230
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
5,659
|
|
5,203
|
|
1,679
|
|
4,923
|
|
5,700
|
Income tax
expense
|
|
1,143
|
|
1,043
|
|
264
|
|
878
|
|
1,087
|
Net income
|
$
|
4,516
|
$
|
4,160
|
$
|
1,415
|
$
|
4,045
|
$
|
4,613
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMUNITY BANKERS TRUST
CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST MARGIN ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended September 30,
2020
|
|
|
Three months ended June 30,
2020
|
|
|
|
Average Balance
Sheet
|
|
Interest Income / Expense
|
|
Average Rates Earned / Paid
|
|
|
Average Balance
Sheet
|
|
Interest Income / Expense
|
|
Average Rates Earned / Paid
|
|
ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, including
fees
|
$
|
1,169,330
|
|
$
|
12,760
|
|
4.33
|
%
|
|
$
|
1,145,956
|
|
$
|
13,012
|
|
4.55
|
%
|
|
PCI loans,
including fees
|
|
28,480
|
|
|
962
|
|
13.21
|
|
|
|
29,978
|
|
|
1,062
|
|
14.01
|
|
|
Total
loans
|
|
1,197,810
|
|
|
13,722
|
|
4.55
|
|
|
|
1,175,934
|
|
|
14,074
|
|
4.80
|
|
|
Interest bearing bank
balances
|
|
70,590
|
|
|
121
|
|
0.68
|
|
|
|
52,551
|
|
|
41
|
|
0.31
|
|
|
Federal funds
sold
|
|
127
|
|
|
-
|
|
0.07
|
|
|
|
210
|
|
|
-
|
|
0.07
|
|
|
Securities
(taxable)
|
|
198,296
|
|
|
1,363
|
|
2.75
|
|
|
|
189,378
|
|
|
1,287
|
|
2.72
|
|
|
Securities (tax
exempt) (1)
|
|
50,551
|
|
|
435
|
|
3.44
|
|
|
|
50,629
|
|
|
442
|
|
3.49
|
|
|
Total earning
assets
|
|
1,517,374
|
|
|
15,641
|
|
4.09
|
|
|
|
1,468,702
|
|
|
15,844
|
|
4.33
|
|
|
Allowance for loan
losses
|
|
(12,424)
|
|
|
|
|
|
|
|
|
(12,007)
|
|
|
|
|
|
|
|
Non-earning
assets
|
|
108,772
|
|
|
|
|
|
|
|
|
109,847
|
|
|
|
|
|
|
|
Total
assets
|
$
|
1,613,722
|
|
|
|
|
|
|
|
$
|
1,566,542
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand - interest
bearing
|
$
|
200,995
|
|
$
|
112
|
|
0.22
|
|
|
$
|
181,789
|
|
$
|
98
|
|
0.22
|
|
|
Savings and money
market
|
|
268,350
|
|
|
241
|
|
0.36
|
|
|
|
241,646
|
|
|
228
|
|
0.38
|
|
|
Time
deposits
|
|
612,848
|
|
|
2,261
|
|
1.46
|
|
|
|
643,465
|
|
|
2,856
|
|
1.78
|
|
|
Total interest
bearing deposits
|
|
1,082,193
|
|
|
2,614
|
|
0.96
|
|
|
|
1,066,900
|
|
|
3,182
|
|
1.20
|
|
|
Short-term
borrowings
|
|
1,611
|
|
|
1
|
|
0.21
|
|
|
|
323
|
|
|
-
|
|
0.20
|
|
|
FHLB and other
borrowings
|
|
72,285
|
|
|
221
|
|
1.19
|
|
|
|
71,685
|
|
|
209
|
|
1.15
|
|
|
Total interest
bearing liabilities
|
|
1,156,089
|
|
|
2,836
|
|
0.97
|
|
|
|
1,138,908
|
|
|
3,391
|
|
1.19
|
|
|
Noninterest bearing
deposits
|
|
281,026
|
|
|
|
|
|
|
|
|
254,216
|
|
|
|
|
|
|
|
Other
liabilities
|
|
12,980
|
|
|
|
|
|
|
|
|
14,396
|
|
|
|
|
|
|
|
Total
liabilities
|
|
1,450,095
|
|
|
|
|
|
|
|
|
1,407,520
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
163,627
|
|
|
|
|
|
|
|
|
159,022
|
|
|
|
|
|
|
|
Total liabilities
and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity
|
$
|
1,613,722
|
|
|
|
|
|
|
|
$
|
1,566,542
|
|
|
|
|
|
|
|
Net interest
earnings
|
|
|
|
$
|
12,805
|
|
|
|
|
|
|
|
$
|
12,453
|
|
|
|
|
Interest
spread
|
|
|
|
|
|
|
3.12
|
%
|
|
|
|
|
|
|
|
3.14
|
%
|
|
Net interest
margin
|
|
|
|
|
|
|
3.35
|
%
|
|
|
|
|
|
|
|
3.40
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-equivalent
adjustment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities
|
|
|
|
$
|
91
|
|
|
|
|
|
|
|
$
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Income and yields are reported
on a tax-equivalent basis assuming a federal tax rate of
21%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMUNITY BANKERS TRUST
CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST MARGIN ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended September 30,
2020
|
|
|
Three months ended September 30,
2019
|
|
|
|
|
Average Balance
Sheet
|
|
Interest Income / Expense
|
|
Average Rates Earned / Paid
|
|
|
Average
Balance
Sheet
|
|
Interest Income / Expense
|
|
Average Rates Earned / Paid
|
|
ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, including
fees
|
$
|
1,169,330
|
|
$
|
12,760
|
|
4.33
|
%
|
|
$
|
1,037,433
|
|
$
|
13,187
|
|
5.04
|
%
|
|
PCI loans,
including fees
|
|
28,480
|
|
|
962
|
|
13.21
|
|
|
|
34,999
|
|
|
2,333
|
|
26.07
|
|
|
Total
loans
|
|
1,197,810
|
|
|
13,722
|
|
4.55
|
|
|
|
1,072,432
|
|
|
15,520
|
|
5.74
|
|
|
Interest bearing bank
balances
|
|
70,590
|
|
|
121
|
|
0.68
|
|
|
|
13,454
|
|
|
87
|
|
2.58
|
|
|
Federal funds
sold
|
|
127
|
|
|
-
|
|
0.07
|
|
|
|
1,795
|
|
|
9
|
|
2.08
|
|
|
Securities
(taxable)
|
|
198,296
|
|
|
1,363
|
|
2.75
|
|
|
|
195,401
|
|
|
1,489
|
|
3.05
|
|
|
Securities (tax
exempt) (1)
|
|
50,551
|
|
|
435
|
|
3.44
|
|
|
|
49,616
|
|
|
450
|
|
3.63
|
|
|
Total earning
assets
|
|
1,517,374
|
|
|
15,641
|
|
4.09
|
|
|
|
1,332,698
|
|
|
17,555
|
|
5.23
|
|
|
Allowance for loan
losses
|
|
(12,424)
|
|
|
|
|
|
|
|
|
(8,872)
|
|
|
|
|
|
|
|
Non-earning
assets
|
|
108,772
|
|
|
|
|
|
|
|
|
101,129
|
|
|
|
|
|
|
|
Total
assets
|
$
|
1,613,722
|
|
|
|
|
|
|
|
$
|
1,424,955
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand - interest
bearing
|
$
|
200,995
|
|
$
|
112
|
|
0.22
|
|
|
$
|
155,208
|
|
$
|
85
|
|
0.22
|
|
|
Savings and money
market
|
|
268,350
|
|
|
241
|
|
0.36
|
|
|
|
224,401
|
|
|
330
|
|
0.58
|
|
|
Time
deposits
|
|
612,848
|
|
|
2,261
|
|
1.46
|
|
|
|
632,625
|
|
|
3,283
|
|
2.06
|
|
|
Total interest
bearing deposits
|
|
1,082,193
|
|
|
2,614
|
|
0.96
|
|
|
|
1,012,234
|
|
|
3,698
|
|
1.45
|
|
|
Short-term
borrowings
|
|
1,611
|
|
|
1
|
|
0.21
|
|
|
|
4,409
|
|
|
28
|
|
2.53
|
|
|
FHLB and other
borrowings
|
|
72,285
|
|
|
221
|
|
1.19
|
|
|
|
62,079
|
|
|
315
|
|
1.99
|
|
|
Total interest
bearing liabilities
|
|
1,156,089
|
|
|
2,836
|
|
0.97
|
|
|
|
1,078,722
|
|
|
4,041
|
|
1.49
|
|
|
Noninterest bearing
deposits
|
|
281,026
|
|
|
|
|
|
|
|
|
181,249
|
|
|
|
|
|
|
|
Other
liabilities
|
|
12,980
|
|
|
|
|
|
|
|
|
14,246
|
|
|
|
|
|
|
|
Total
liabilities
|
|
1,450,095
|
|
|
|
|
|
|
|
|
1,274,217
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
163,627
|
|
|
|
|
|
|
|
|
150,738
|
|
|
|
|
|
|
|
Total liabilities
and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
shareholders' equity
|
$
|
1,613,722
|
|
|
|
|
|
|
|
$
|
1,424,955
|
|
|
|
|
|
|
|
Net interest
earnings
|
|
|
|
$
|
12,805
|
|
|
|
|
|
|
|
$
|
13,514
|
|
|
|
|
Interest
spread
|
|
|
|
|
|
|
3.12
|
%
|
|
|
|
|
|
|
|
3.74
|
%
|
|
Net interest
margin
|
|
|
|
|
|
|
3.35
|
%
|
|
|
|
|
|
|
|
4.02
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-equivalent
adjustment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities
|
|
|
$
|
|
91
|
|
|
|
|
|
|
$
|
|
95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Income and yields are reported
on a tax-equivalent basis assuming a federal tax rate of
21%.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMUNITY BANKERS TRUST
CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST MARGIN ANALYSIS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended September 30,
2020
|
|
|
Nine months ended September 30,
2019
|
|
|
|
Average Balance
Sheet
|
|
Interest Income / Expense
|
|
Average Rates Earned / Paid
|
|
|
Average Balance
Sheet
|
|
Interest Income / Expense
|
|
Average Rates Earned / Paid
|
|
ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, including
fees
|
$
|
1,127,002
|
|
$
|
38,858
|
|
4.59
|
%
|
|
$
|
1,016,041
|
|
$
|
38,246
|
|
5.03
|
%
|
|
PCI loans,
including fees
|
|
29,917
|
|
|
3,121
|
|
13.71
|
|
|
|
36,321
|
|
|
4,877
|
|
17.70
|
|
|
Total
loans
|
|
1,156,919
|
|
|
41,979
|
|
4.83
|
|
|
|
1,052,362
|
|
|
43,123
|
|
5.48
|
|
|
Interest bearing bank
balances
|
|
46,620
|
|
|
231
|
|
0.66
|
|
|
|
15,752
|
|
|
300
|
|
2.55
|
|
|
Federal funds
sold
|
|
159
|
|
|
-
|
|
0.36
|
|
|
|
890
|
|
|
14
|
|
2.17
|
|
|
Securities
(taxable)
|
|
190,035
|
|
|
4,000
|
|
2.81
|
|
|
|
190,433
|
|
|
4,483
|
|
3.14
|
|
|
Securities (tax
exempt) (1)
|
|
50,192
|
|
|
1,311
|
|
3.48
|
|
|
|
58,577
|
|
|
1,585
|
|
3.61
|
|
|
Total earning
assets
|
|
1,443,925
|
|
|
47,521
|
|
4.38
|
|
|
|
1,318,014
|
|
|
49,505
|
|
5.02
|
|
|
Allowance for loan
losses
|
|
(11,023)
|
|
|
|
|
|
|
|
|
(8,925)
|
|
|
|
|
|
|
|
Non-earning
assets
|
|
108,056
|
|
|
|
|
|
|
|
|
100,221
|
|
|
|
|
|
|
|
Total
assets
|
$
|
1,540,958
|
|
|
|
|
|
|
|
$
|
1,409,310
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand - interest
bearing
|
$
|
184,415
|
|
$
|
304
|
|
0.22
|
|
|
$
|
156,335
|
|
$
|
258
|
|
0.22
|
|
|
Savings and money
market
|
|
243,311
|
|
|
749
|
|
0.41
|
|
|
|
220,868
|
|
|
930
|
|
0.56
|
|
|
Time
deposits
|
|
629,598
|
|
|
8,162
|
|
1.73
|
|
|
|
634,434
|
|
|
9,333
|
|
1.97
|
|
|
Total
interest bearing deposits
|
|
1,057,324
|
|
|
9,215
|
|
1.16
|
|
|
|
1,011,637
|
|
|
10,521
|
|
1.39
|
|
|
Short-term
borrowings
|
|
2,038
|
|
|
24
|
|
1.57
|
|
|
|
4,072
|
|
|
84
|
|
2.77
|
|
|
FHLB and other
borrowings
|
|
70,263
|
|
|
696
|
|
1.30
|
|
|
|
64,686
|
|
|
1,023
|
|
2.09
|
|
|
Total interest
bearing liabilities
|
|
1,129,625
|
|
|
9,935
|
|
1.17
|
|
|
|
1,080,395
|
|
|
11,628
|
|
1.44
|
|
|
Noninterest bearing
deposits
|
|
237,198
|
|
|
|
|
|
|
|
|
170,919
|
|
|
|
|
|
|
|
Other
liabilities
|
|
13,849
|
|
|
|
|
|
|
|
|
12,809
|
|
|
|
|
|
|
|
Total
liabilities
|
|
1,380,672
|
|
|
|
|
|
|
|
|
1,264,123
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
160,286
|
|
|
|
|
|
|
|
|
145,187
|
|
|
|
|
|
|
|
Total liabilities
and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
shareholders' equity
|
$
|
1,540,958
|
|
|
|
|
|
|
|
$
|
1,409,310
|
|
|
|
|
|
|
|
Net interest
earnings
|
|
|
|
$
|
37,586
|
|
|
|
|
|
|
|
|
37,877
|
|
|
|
|
Interest
spread
|
|
|
|
|
|
|
3.21
|
%
|
|
|
|
|
$
|
|
|
3.58
|
%
|
|
Net interest
margin
|
|
|
|
|
|
|
3.48
|
%
|
|
|
|
|
|
|
|
3.84
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-equivalent
adjustment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities
|
|
|
|
$
|
275
|
|
|
|
|
|
|
$
|
|
333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Income and yields are reported
on a tax-equivalent basis assuming a federal tax rate of
21%.
|
|
|
|
|
|
|
|
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/community-bankers-trust-corporation-reports-results-for-third-quarter-of-2020-301163586.html
SOURCE Community Bankers Trust Corporation