BIRMINGHAM, Ala., July 26,
2023 /PRNewswire/ -- Second Quarter
Highlights:
Net Income
|
Diluted Earnings per share
|
Return on average assets
(annualized)
|
Return on average common
equity (annualized)
|
Return on average tangible
common equity (annualized) (1)
|
Loans to deposits
|
$2.0
million
|
$0.31
|
0.79 %
|
9.48 %
|
10.41 %
|
87.3 %
|
First US Bancshares, Inc. (Nasdaq: FUSB) (the "Company"), the
parent company of First US Bank (the "Bank"), today reported net
income of $2.0 million, or
$0.31 per diluted share, for the
quarter ended June 30, 2023 ("2Q2023"), compared to
$2.1 million, or $0.33 per diluted share, for the quarter ended
March 31, 2023 ("1Q2023") and
$1.4 million, or $0.22 per diluted share, for the quarter ended
June 30, 2022 ("2Q2022"). Net income totaled
$4.1 million, or $0.64 per diluted share, for the six months ended
June 30, 2023, compared to $2.8
million, or $0.42 per diluted
share, for the six months ended June 30, 2022, an increase of
52.4% on diluted earnings per share.
The table below summarizes selected financial data for each of
the periods presented.
|
|
Quarter
Ended
|
|
|
Six Months
Ended
|
|
|
|
2023
|
|
|
2022
|
|
|
2023
|
|
|
2022
|
|
|
|
June
30,
|
|
|
March
31,
|
|
|
December
31,
|
|
|
September
30,
|
|
|
June
30,
|
|
|
June
30,
|
|
|
June
30,
|
|
Results of
Operations:
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Interest
income
|
|
$
|
12,999
|
|
|
$
|
11,960
|
|
|
$
|
11,621
|
|
|
$
|
10,670
|
|
|
$
|
9,525
|
|
|
$
|
24,959
|
|
|
$
|
18,906
|
|
Interest
expense
|
|
|
3,676
|
|
|
|
2,526
|
|
|
|
1,730
|
|
|
|
1,155
|
|
|
|
699
|
|
|
|
6,202
|
|
|
|
1,371
|
|
Net interest
income
|
|
|
9,323
|
|
|
|
9,434
|
|
|
|
9,891
|
|
|
|
9,515
|
|
|
|
8,826
|
|
|
|
18,757
|
|
|
|
17,535
|
|
Provision for credit
losses
|
|
|
300
|
|
|
|
269
|
|
|
|
527
|
|
|
|
1,165
|
|
|
|
895
|
|
|
|
569
|
|
|
|
1,616
|
|
Net interest income
after provision for credit losses
|
|
|
9,023
|
|
|
|
9,165
|
|
|
|
9,364
|
|
|
|
8,350
|
|
|
|
7,931
|
|
|
|
18,188
|
|
|
|
15,919
|
|
Non-interest
income
|
|
|
799
|
|
|
|
829
|
|
|
|
678
|
|
|
|
1,088
|
|
|
|
856
|
|
|
|
1,628
|
|
|
|
1,685
|
|
Non-interest
expense
|
|
|
7,151
|
|
|
|
7,270
|
|
|
|
7,106
|
|
|
|
7,032
|
|
|
|
6,878
|
|
|
|
14,421
|
|
|
|
13,934
|
|
Income before income
taxes
|
|
|
2,671
|
|
|
|
2,724
|
|
|
|
2,936
|
|
|
|
2,406
|
|
|
|
1,909
|
|
|
|
5,395
|
|
|
|
3,670
|
|
Provision for income
taxes
|
|
|
648
|
|
|
|
652
|
|
|
|
708
|
|
|
|
546
|
|
|
|
494
|
|
|
|
1,300
|
|
|
|
894
|
|
Net income
|
|
$
|
2,023
|
|
|
$
|
2,072
|
|
|
$
|
2,228
|
|
|
$
|
1,860
|
|
|
$
|
1,415
|
|
|
$
|
4,095
|
|
|
$
|
2,776
|
|
Per Share
Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income per
share
|
|
$
|
0.34
|
|
|
$
|
0.35
|
|
|
$
|
0.37
|
|
|
$
|
0.31
|
|
|
$
|
0.23
|
|
|
$
|
0.69
|
|
|
$
|
0.45
|
|
Diluted net income per
share
|
|
$
|
0.31
|
|
|
$
|
0.33
|
|
|
$
|
0.35
|
|
|
$
|
0.29
|
|
|
$
|
0.22
|
|
|
$
|
0.64
|
|
|
$
|
0.42
|
|
Dividends
declared
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.03
|
|
|
$
|
0.03
|
|
|
$
|
0.10
|
|
|
$
|
0.06
|
|
Key Measures (Period
End):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
1,068,126
|
|
|
$
|
1,026,658
|
|
|
$
|
994,667
|
|
|
$
|
989,277
|
|
|
$
|
955,385
|
|
|
|
|
|
|
|
Tangible assets
(1)
|
|
|
1,060,435
|
|
|
|
1,018,912
|
|
|
|
986,866
|
|
|
|
981,421
|
|
|
|
947,462
|
|
|
|
|
|
|
|
Total loans
|
|
|
814,494
|
|
|
|
775,889
|
|
|
|
773,873
|
|
|
|
750,271
|
|
|
|
714,637
|
|
|
|
|
|
|
|
Allowance for credit
losses
|
|
|
11,536
|
|
|
|
11,599
|
|
|
|
9,422
|
|
|
|
9,373
|
|
|
|
8,751
|
|
|
|
|
|
|
|
Investment securities,
net
|
|
|
124,404
|
|
|
|
128,689
|
|
|
|
132,657
|
|
|
|
145,903
|
|
|
|
152,536
|
|
|
|
|
|
|
|
Total
deposits
|
|
|
932,628
|
|
|
|
897,885
|
|
|
|
870,025
|
|
|
|
846,537
|
|
|
|
844,296
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
|
30,000
|
|
|
|
25,000
|
|
|
|
20,038
|
|
|
|
40,106
|
|
|
|
10,088
|
|
|
|
|
|
|
|
Long-term
borrowings
|
|
|
10,763
|
|
|
|
10,744
|
|
|
|
10,726
|
|
|
|
10,708
|
|
|
|
10,690
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
85,725
|
|
|
|
84,757
|
|
|
|
85,135
|
|
|
|
83,103
|
|
|
|
82,576
|
|
|
|
|
|
|
|
Tangible common equity
(1)
|
|
|
78,034
|
|
|
|
77,011
|
|
|
|
77,334
|
|
|
|
75,247
|
|
|
|
74,653
|
|
|
|
|
|
|
|
Book value per common
share
|
|
|
14.59
|
|
|
|
14.45
|
|
|
|
14.65
|
|
|
|
14.30
|
|
|
|
14.05
|
|
|
|
|
|
|
|
Tangible book value per
common share (1)
|
|
|
13.28
|
|
|
|
13.13
|
|
|
|
13.31
|
|
|
|
12.95
|
|
|
|
12.70
|
|
|
|
|
|
|
|
Key
Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (annualized)
|
|
|
0.79
|
%
|
|
|
0.85
|
%
|
|
|
0.90
|
%
|
|
|
0.75
|
%
|
|
|
0.58
|
%
|
|
|
0.82
|
%
|
|
|
0.58
|
%
|
Return on average
common equity (annualized)
|
|
|
9.48
|
%
|
|
|
10.02
|
%
|
|
|
10.60
|
%
|
|
|
8.78
|
%
|
|
|
6.55
|
%
|
|
|
9.74
|
%
|
|
|
6.36
|
%
|
Return on average
tangible common equity (annualized) (1)
|
|
|
10.41
|
%
|
|
|
11.05
|
%
|
|
|
11.70
|
%
|
|
|
9.69
|
%
|
|
|
7.21
|
%
|
|
|
10.72
|
%
|
|
|
6.99
|
%
|
Net interest
margin
|
|
|
3.88
|
%
|
|
|
4.13
|
%
|
|
|
4.27
|
%
|
|
|
4.10
|
%
|
|
|
3.91
|
%
|
|
|
4.00
|
%
|
|
|
3.94
|
%
|
Efficiency ratio
(2)
|
|
|
70.6
|
%
|
|
|
70.8
|
%
|
|
|
67.2
|
%
|
|
|
66.3
|
%
|
|
|
71.0
|
%
|
|
|
70.7
|
%
|
|
|
72.5
|
%
|
Total loans to
deposits
|
|
|
87.3
|
%
|
|
|
86.4
|
%
|
|
|
88.9
|
%
|
|
|
88.6
|
%
|
|
|
84.6
|
%
|
|
|
|
|
|
|
Total loans to
assets
|
|
|
76.3
|
%
|
|
|
75.6
|
%
|
|
|
77.8
|
%
|
|
|
75.8
|
%
|
|
|
74.8
|
%
|
|
|
|
|
|
|
Common equity to total
assets
|
|
|
8.03
|
%
|
|
|
8.26
|
%
|
|
|
8.56
|
%
|
|
|
8.40
|
%
|
|
|
8.64
|
%
|
|
|
|
|
|
|
Tangible common equity
to tangible assets (1)
|
|
|
7.36
|
%
|
|
|
7.56
|
%
|
|
|
7.84
|
%
|
|
|
7.67
|
%
|
|
|
7.88
|
%
|
|
|
|
|
|
|
Tier 1 leverage ratio
(3)
|
|
|
9.19
|
%
|
|
|
9.36
|
%
|
|
|
9.39
|
%
|
|
|
9.23
|
%
|
|
|
9.33
|
%
|
|
|
|
|
|
|
Allowance for credit
losses as % of loans
|
|
|
1.42
|
%
|
|
|
1.49
|
%
|
|
|
1.22
|
%
|
|
|
1.25
|
%
|
|
|
1.22
|
%
|
|
|
|
|
|
|
Nonperforming assets as
% of total assets
|
|
|
0.15
|
%
|
|
|
0.18
|
%
|
|
|
0.24
|
%
|
|
|
0.28
|
%
|
|
|
0.18
|
%
|
|
|
|
|
|
|
Net charge-offs as a
percentage of average loans
|
|
|
0.14
|
%
|
|
|
0.11
|
%
|
|
|
0.25
|
%
|
|
|
0.29
|
%
|
|
|
0.36
|
%
|
|
|
0.14
|
%
|
|
|
0.34
|
%
|
|
(1)
Refer to Non-GAAP reconciliation of tangible balances and measures
beginning on page 12.
|
(2)
Efficiency ratio = non-interest expense / (net interest income +
non-interest income)
|
(3)
First US Bank Tier 1 leverage ratio
|
CEO Commentary
"We are pleased to report a quarter of solid earnings amid a
turbulent environment in the banking industry," stated James F. House, President and CEO of the
Company. "While net interest margin compressed during the quarter,
we experienced substantial loan growth which enabled us to maintain
reasonably consistent net interest income compared to the previous
quarter. The Company's significant year-over-year earnings
improvement reflects both the overall beneficial impact of the
higher interest rate environment on net interest income, as well as
reduced provisioning for credit losses resulting from the Company's
ongoing strategic efforts to improve the Company's asset
quality. To date, the results of these efforts have exceeded
our expectations," concluded Mr. House.
Strategic Focus and Impact on Asset Quality
Since late 2021, the Company has benefited from strategic
initiatives implemented in the third quarter of 2021 that were
designed to improve operating efficiency, focus the Company's loan
growth activities, and fortify asset quality. The most significant
component of these initiatives was the cessation of new business at
the Bank's wholly-owned consumer loan-focused subsidiary,
Acceptance Loan Company ("ALC"). This initiative, which
included the closure of ALC's branch lending locations in
September 2021, served to
significantly decrease the Company's non-interest expense beginning
in 2022, and is expected to substantially improve the Company's
consumer lending asset quality as ALC's remaining loans pay down
over time. Historically, ALC's loans have produced significantly
higher levels of charge-offs than the Bank's other loan
portfolios.
As of June 30, 2023, remaining
loans at ALC totaled $14.2 million,
compared to $20.2 million as of
December 31, 2022. During the first
half of 2023, the Company began to realize substantially lower
levels of net charge-offs associated with ALC loans as compared to
prior periods. Net charge-offs on ALC loans totaled $0.2 million, or 2.61% of average loans, during
the six months ended June 30, 2023,
compared to $1.1 million, or 6.36% of
average loans, during the six months ended June 30, 2022. While ALC's loans have decreased,
management has continued to focus the Company's loan growth
activities on other consumer portfolios of higher credit quality.
In recent years, the Company's primary vehicle for consumer loan
growth has been through the Bank's indirect consumer lending
program which now operates in 17 states and consists of loans
collateralized by recreational vehicles, campers, boats, horse
trailers and cargo trailers. As of June 30,
2023, loans obtained through the indirect program totaled
$300.2 million, compared to
$266.6 million as of December 31, 2022. The weighted average credit
score of loans in the indirect program totaled 770 as of
June 30, 2023, and the weighted
average credit score of loans added to the portfolio during the
first six months of 2023 totaled 792. While net charge-offs in the
indirect portfolio have increased in 2023 compared to 2022, loss
percentages remain relatively low compared to ALC's historic
levels. Net charge-offs as a percentage of average loans in the
indirect portfolio totaled 0.20% during the six months ended
June 30, 2023, compared to 0.08%
during the six months ended June 30,
2022.
The reductions in ALC's lending portfolio and growth in consumer
lending of more favorable credit quality through the indirect
program have contributed to substantial improvement in the credit
quality of the Company's consumer portfolio since late 2021, and
accordingly, has led to improvement in the Company's overall asset
quality. As of June 30, 2023,
the Company's nonperforming assets as a percentage of assets
decreased to 0.15%, compared to 0.24% as of December 31, 2022, while net charge-offs as a
percentage of average loans decreased to 0.14% during the first six
months of 2023, compared to 0.34% during the first six months of
2022.
Other Second Quarter Financial Results
Loan Growth – The table below summarizes loan
balances by portfolio category as of the end of each of the most
recent five quarters.
|
|
Quarter
Ended
|
|
|
2023
|
|
2022
|
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
|
September
30,
|
|
June
30,
|
|
|
(Dollars in
Thousands)
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
Real estate
loans:
|
|
|
|
|
|
|
|
|
|
|
Construction, land
development and other land loans
|
|
$91,231
|
|
$69,398
|
|
$53,914
|
|
$36,230
|
|
$40,647
|
Secured by 1-4 family
residential properties
|
|
85,101
|
|
86,622
|
|
87,995
|
|
84,452
|
|
69,109
|
Secured by
multi-family residential properties
|
|
54,719
|
|
63,368
|
|
67,852
|
|
72,377
|
|
66,851
|
Secured by non-farm,
non-residential properties
|
|
204,270
|
|
198,266
|
|
200,156
|
|
200,707
|
|
187,032
|
Commercial and
industrial loans
|
|
60,568
|
|
65,708
|
|
73,546
|
|
65,935
|
|
65,909
|
Consumer
loans:
|
|
|
|
|
|
|
|
|
|
|
Direct
|
|
7,593
|
|
8,435
|
|
9,851
|
|
11,950
|
|
14,891
|
Branch
retail
|
|
10,830
|
|
12,222
|
|
13,992
|
|
15,878
|
|
17,992
|
Indirect
|
|
300,182
|
|
271,870
|
|
266,567
|
|
262,742
|
|
252,206
|
Total loans held for
investment
|
|
$814,494
|
|
$775,889
|
|
$773,873
|
|
$750,271
|
|
$714,637
|
Allowance for credit
losses
|
|
11,536
|
|
11,599
|
|
9,422
|
|
9,373
|
|
8,751
|
Net loans held for
investment
|
|
$802,958
|
|
$764,290
|
|
$764,451
|
|
$740,898
|
|
$705,886
|
Total loans increased by $38.6
million, or 5.0%, during 2Q2023. Loan volume increases
during the quarter were driven primarily by growth in indirect
consumer, construction, and commercial real estate (secured by
non-farm, non-residential properties). The increase in construction
was primarily attributable to growth in construction fundings on
multi-family residential projects, while the growth in commercial
real estate reflected ongoing economic growth in the Company's
service territories, albeit at a slowing pace. Growth in indirect
consumer lending was consistent with continued demand for the
products collateralized through the Company's indirect program.
Indirect loan growth tends to be seasonal due to its emphasis on
outdoor recreational products, with growth typically more
pronounced in the spring and early summer months. Loan growth in
2Q2023 was partially offset by decreases in the residential real
estate and commercial and industrial categories, as well as the
direct consumer and branch retail consumer categories. Loans in
direct consumer and branch retail were expected to decrease as they
comprise the majority of ALC's remaining loan balances. For the six
months ended June 30, 2023, total
loans increased by $40.6 million, or
5.2%, compared to growth of $6.3
million, or 0.9%, during the corresponding period of
2022.
Net Interest Income and Margin – Net interest income
totaled $9.3 million in 2Q2023,
compared to $9.4 million in 1Q2023.
Net interest margin was 3.88% in 2Q2023, compared to 4.13% in
1Q2023. The decrease in both net interest income and margin
compared to the previous quarter resulted from the ongoing impact
of the rising interest rate environment as interest-bearing
liabilities repriced faster than interest-earning assets during the
quarter. Year-over-year, the Company has benefited from the rising
interest rate environment that has persisted since March
2022. For the six months ended June
30, 2023, net interest income totaled $18.8 million (net interest margin of 4.00%),
compared to $17.5 million (net
interest margin of 3.94%) for the six months ended June 30, 2022. During the first six months
of 2023, the competitive environment related to deposit pricing
became increasingly more acute as the banking industry increased
its focus on deposit growth in the wake of bank failures that
occurred in the industry, primarily during 1Q2023. Given this
environment, management focused efforts during 2Q2023 on both
maintaining core deposit levels and growing deposits through
competitive pricing.
Deposit Growth – Deposit growth totaled $34.7 million, or 3.9%, during 2Q2023. The growth
included an increase of $5.9 million
in noninterest-bearing deposits and $28.8
million in interest-bearing accounts. For the six months
ended June 30, 2023, total deposits
increased $62.6 million, or 7.2%. The
year-to-date growth included an increase of $71.9 million in interest-bearing deposits,
offset by a decrease of $9.3 million
in noninterest-bearing deposits. The year-to-date shift to
interest-bearing deposits is consistent with deposit holders
seeking to maximize interest earnings on their accounts,
particularly during 1Q2023. In addition, deposit growth for the
first six months of 2023 included growth of $40.2 million in wholesale brokered deposits that
were acquired in order to further enhance the Company's liquidity
position following the bank failures that occurred during 1Q2023.
As of June 30, 2023, core deposits,
which exclude time deposits of $250
thousand or more and all brokered deposits, totaled
$785.7 million, or 84.2% of total
deposits, compared to $761.7 million,
or 84.8% of total deposits as of March 31,
2023, and $778.1 million, or
89.4% of total deposits, as of December
31, 2022.
Deployment of Funds – Management seeks to deploy earning
assets in an efficient manner to maximize net interest income while
maintaining appropriate levels of liquidity to protect the safety
and soundness of the organization. Management's decisions,
particularly during the latter portion of 1Q2023 and throughout
2Q2023 were focused on maintaining the Company's strong liquidity
position. As part of this focus, management elected to hold higher
levels of cash and cash equivalents and did not seek to re-deploy
excess cash into the Company's investment securities portfolio
during the quarter. Cash and cash equivalents totaled $74.7 million as of June
30, 2023, compared to $68.4
million as of March 31, 2023,
and $30.2 million as of December 31, 2022. Investment securities,
including both the available-for-sale and held-to-maturity
portfolios, totaled $124.4 million as
of June 30, 2023, compared to $128.7
million as of March 31, 2023,
and $132.7 million as of
December 31, 2022. The expected average life of securities in
the investment portfolio was 3.6 years as of June 30, 2023,
compared to 3.5 years as of December 31, 2022. Management will
continue to evaluate opportunities to invest excess cash balances
within the context of anticipated loan and deposit growth and
current liquidity needs.
Provision for Credit Losses – The Company recorded a
provision for credit losses of $0.3
million during both 2Q2023 and 1Q2023. For the six months
ended June 30, 2023, provision for credit losses totaled
$0.6 million, compared to
$1.6 million for the six months ended
June 30, 2022. The year-to-date decrease in 2023 compared to
2022 was primarily the result of the cessation of business strategy
at ALC which led to significantly reduced net charge-offs as ALC's
loans have paid down.
The tables below summarize changes in the Company's allowance
for credit losses on loans during the first six months of 2023,
including the impact of the adoption of the current expected credit
loss (CECL) accounting standard on January
1, 2023.
|
|
As of and for the
Six Months Ended June 30, 2023
|
|
|
Construction,
Land
Development,
and Other
|
|
Real Estate
1-4
Family
|
|
Real
Estate
Multi-
Family
|
|
Non-
Farm Non-
Residential
|
|
Commercial
and
Industrial
|
|
Direct
Consumer
|
|
Branch
Retail
|
|
Indirect
Consumer
|
|
Total
|
|
|
(Dollars in
Thousands)
|
|
|
(Unaudited)
|
Allowance for credit
losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning
balance
|
|
$517
|
|
$832
|
|
$646
|
|
$1,970
|
|
$919
|
|
$866
|
|
$518
|
|
$3,154
|
|
$9,422
|
Impact of adopting
CECL
|
|
(94)
|
|
(39)
|
|
(85)
|
|
(147)
|
|
(20)
|
|
47
|
|
628
|
|
1,833
|
|
2,123
|
Charge-offs
|
|
—
|
|
(55)
|
|
—
|
|
—
|
|
—
|
|
(415)
|
|
(266)
|
|
(301)
|
|
(1,037)
|
Recoveries
|
|
—
|
|
23
|
|
—
|
|
—
|
|
—
|
|
347
|
|
146
|
|
33
|
|
549
|
Provision
|
|
204
|
|
11
|
|
(145)
|
|
(76)
|
|
(327)
|
|
(215)
|
|
(90)
|
|
1,117
|
|
479
|
Ending
balance
|
|
$627
|
|
$772
|
|
$416
|
|
$1,747
|
|
$572
|
|
$630
|
|
$936
|
|
$5,836
|
|
$11,536
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for Credit
Losses as a Percentage of Total Loans (Before and After CECL
Adoption)
|
December 31,
2022
|
|
0.95 %
|
|
0.94 %
|
|
0.95 %
|
|
0.99 %
|
|
1.25 %
|
|
8.61 %
|
|
3.64 %
|
|
1.18 %
|
|
1.22 %
|
January 1, 2023
(adoption)
|
|
0.78 %
|
|
0.90 %
|
|
0.83 %
|
|
0.91 %
|
|
1.22 %
|
|
9.08 %
|
|
8.05 %
|
|
1.87 %
|
|
1.49 %
|
March 31,
2023
|
|
0.75 %
|
|
0.89 %
|
|
0.80 %
|
|
0.89 %
|
|
1.19 %
|
|
10.57 %
|
|
8.74 %
|
|
1.95 %
|
|
1.49 %
|
June 30,
2023
|
|
0.69 %
|
|
0.91 %
|
|
0.76 %
|
|
0.86 %
|
|
0.94 %
|
|
8.30 %
|
|
8.64 %
|
|
1.94 %
|
|
1.42 %
|
In addition to the provision for credit losses noted in the
table above, the Company recorded $0.1
million to the provision for credit losses associated with
unfunded commitments during the six months ended June 30, 2023.
Non-interest Income – Non-interest income levels remained
relatively consistent, totaling $0.8
million in both 2Q2023 and 1Q2023 and $0.9 million in 2Q2022. For the six months ended
June 30, 2023, non-interest income totaled $1.6 million, compared to $1.7 million for the six months ended
June 30, 2022.
Non-interest Expense – Non-interest expense totaled
$7.2 million in 2Q2023, compared to
$7.3 million in 1Q2023, and
$6.9 million 2Q2022. For the
six months ended June 30, 2023, non-interest expense totaled
$14.4 million, compared to
$13.9 million for the six months
ended June 30, 2022. The increase comparing 2Q2023 to 2Q2022,
as well as the year-to-date periods, resulted from nonrecurring
gains on the sale of OREO properties that offset non-interest
expense in 2022, but were not repeated in 2023.
Shareholders' Equity – As of June 30, 2023,
shareholders' equity totaled $85.7
million, or 8.0% of total assets, compared to $85.1 million, or 8.6% of total assets, as of
December 31, 2022. The increase in shareholders' equity
resulted from earnings, net of dividends paid, offset by the CECL
transition adjustment which reduced retained earnings by
$1.8 million, net of tax, as well as
a net increase in accumulated other comprehensive loss totaling
$1.4 million associated with fair
value declines in the available-for-sale investment portfolio and
reclassification adjustments associated with terminated interest
rate swaps. As of June 30, 2023, the Company's ratio of common
equity to total assets totaled 8.03%, compared to 8.56% as of
December 31, 2022, while the Company's ratio of tangible
common equity to tangible assets totaled 7.36% as of June 30,
2023, compared to 7.84% as of December 31,
2022.
Cash Dividend – The Company declared a cash dividend of
$0.05 per share on its common stock
in 2Q2023. The dividend is consistent with amounts paid in 1Q2023
and the fourth quarter of 2022 ("4Q2022"). During each of the first
three quarters of 2022, the Company paid cash dividends of
$0.03 per common share. The increased
dividend beginning in 4Q2022 is commensurate with the earnings
improvement experienced by the Company in both the six months
ended June 30, 2023 and full year 2022.
Regulatory Capital – During 2Q2023, the Bank continued to
maintain capital ratios at higher levels than required to be
considered a "well-capitalized" institution under applicable
banking regulations. As of June 30, 2023, the Bank's common
equity Tier 1 capital and Tier 1 risk-based capital ratios were
each 10.85%, its total capital ratio was 12.10%, and its Tier 1
leverage ratio was 9.19%.
Liquidity – As of June 30, 2023, the Company
continued to maintain excess funding capacity sufficient to provide
adequate liquidity for loan growth, capital expenditures and
ongoing operations. The Company benefits from a strong core deposit
base, a liquid investment securities portfolio and access to
funding from a variety of sources, including federal funds lines,
Federal Home Loan Bank (FHLB) advances and brokered deposits. In
addition, the Company has access to the Federal Reserve's discount
window and its Bank Term Funding Program (BTFP), the latter of
which was established during 1Q2023 in response to the liquidity
events that occurred in the banking industry. Both the discount
window and the BTFP allow borrowing on pledged collateral that
includes eligible investment securities and, in certain
circumstances, eligible loans. The discount window allows borrowing
under 90-day terms, while borrowing terms under the BTFP are up to
one year. The BTFP also allows investment securities to be pledged
as collateral at 100% of par value when par value is greater than
fair value. Although management periodically tests the Company's
ability to access cash from the Federal Reserve, the Company had no
balances outstanding under either the discount window or BTFP s of
June 30, 2023 and December 31, 2022.
In response to heightened liquidity concerns for the banking
industry, in 1Q2023, management undertook procedures designed to
enhance the Company's liquidity position, including holding higher
levels of on-balance sheet cash. During 2Q2023, management further
enhanced on-balance sheet liquidity levels primarily through growth
in unencumbered deposits. Exclusive of wholesale brokered deposit
fundings, the Company's total deposits increased by $29.8 million, or 3.7%, comparing June 30, 2023 to March 31,
2023. Although events during 1Q2023 strained the banking
industry as a whole, the Company's management remains confident in
the stability of the Company's core deposit base which has served
as the Company's primary funding source for many years. Excluding
wholesale brokered deposits, as of June 30,
2023, the Company had over 29 thousand deposit accounts with
an average balance of approximately $28.4
thousand per account. Estimated uninsured deposits
(calculated as deposit amounts per deposit holder in excess of
$250 thousand, the maximum amount of
federal deposit insurance, and excluding deposits secured by
pledged assets) totaled $161.7
million, or 17.3% of total deposits, as of June 30, 2023. As of December 31, 2022, estimated uninsured deposits
totaled $148.3 million, or 17.1% of
total deposits.
The table below provides information on the Company's on-balance
sheet liquidity, as well as readily available sources of liquidity
as of both June 30, 2023 and
December 31, 2022.
|
June 30,
2023
|
|
|
December 31,
2022
|
|
|
(Dollars in
Thousands)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Liquidity from cash and
federal funds sold:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
74,668
|
|
|
$
|
30,152
|
|
Federal funds
sold
|
|
721
|
|
|
|
1,768
|
|
Liquidity from cash
and federal funds sold
|
|
75,389
|
|
|
|
31,920
|
|
Liquidity from
pledgable investment securities:
|
|
|
|
|
|
Investment securities
available-for sale, at fair value
|
|
122,933
|
|
|
|
130,795
|
|
Investment securities
held-to-maturity, at amortized cost
|
|
1,471
|
|
|
|
1,862
|
|
Less: securities
pledged
|
|
(43,893)
|
|
|
|
(54,717)
|
|
Less: estimated
collateral value discounts
|
|
(10,653)
|
|
|
|
(7,833)
|
|
Liquidity from
pledgable investment securities
|
|
69,858
|
|
|
|
70,107
|
|
Liquidity from unused
lendable collateral (loans) at FHLB
|
|
10,996
|
|
|
|
18,215
|
|
Unsecured lines of
credit with banks
|
|
28,000
|
|
|
|
45,000
|
|
Total readily
available liquidity
|
$
|
184,243
|
|
|
$
|
165,242
|
|
The table calculates readily available sources of liquidity,
including cash and cash equivalents, federal funds sold, and other
liquidity sources. Certain of the measures have not been
prepared in accordance with U.S. generally accepted accounting
principles ("GAAP"); however, management believes that the non-GAAP
measures are beneficial to the reader as they enhance the overall
understanding of the Company's liquidity position and can be used
as a supplement to GAAP-based measures of liquidity. Specifically,
liquidity from pledgable investment securities and total readily
available liquidity are non-GAAP measures used by management and
regulators to analyze a portion of the Company's liquidity.
Management uses these measures to evaluate the Company's liquidity
position. Pledgable investment securities are considered by
management as a readily available source of liquidity since the
Company has the ability to pledge the securities with the FHLB or
Federal Reserve to obtain immediate funding. Both
available-for-sale and held-for-maturity securities may be pledged
at fair value with the FHLB and through the Federal Reserve
discount window. The amounts shown as liquidity from pledgable
investment securities represents total investment securities as
recorded on the balance sheet, less reductions for securities
already pledged and discounts expected to be taken by the lender to
determine collateral value. The calculations are intended to
reflect minimum levels of liquidity readily available to the
Company through the pledging of investment securities, and do not
contemplate the additional available liquidity that could be
available from the Federal Reserve through the BTFP.
Other readily available sources of liquidity include unused
collateral in the form of loans that the Company had pledged with
the FHLB, as well as unsecured lines of credit with other banks.
The unused lendable collateral value at the FHLB presented in the
table represents only the amount immediately available to the
Company from loans already pledged by the Company to the FHLB as of
each balance sheet date presented. As of June 30, 2023 and
December 31, 2022, the Company's
total remaining credit availability with the FHLB was $248.0 million and $246.8
million, respectively, subject to the pledging of additional
collateral which may include eligible investment securities and
loans. In addition, the Company has access to additional sources of
liquidity that generally could be obtained over a period of time.
For example, the Company has access to unsecured brokered deposits
through the wholesale funding markets. Management believes the
Company's on-balance sheet and other readily available liquidity
provide strong indicators of the Company's ability to fund
obligations in a stressed liquidity environment.
About First US Bancshares, Inc.
First US Bancshares, Inc. (the "Company") is a bank holding
company that operates banking offices in Alabama, Tennessee, and Virginia through First US Bank (the "Bank").
In addition, the Company's operations include Acceptance Loan
Company, Inc. ("ALC"), a consumer loan company. The Company
files periodic reports with the U.S. Securities and Exchange
Commission (the "SEC"). Copies of its filings may be obtained
through the SEC's website at www.sec.gov or at www.firstusbank.com.
More information about the Company and the Bank may be obtained at
www.firstusbank.com. The Company's stock is traded on the Nasdaq
Capital Market under the symbol "FUSB."
Forward-Looking Statements
This press release contains forward-looking statements, as
defined by federal securities laws. Statements contained in this
press release that are not historical facts are forward-looking
statements. These statements may address issues that involve
significant risks, uncertainties, estimates and assumptions made by
management. The Company undertakes no obligation to update these
statements following the date of this press release, except as
required by law. In addition, the Company, through its senior
management, may make from time to time forward-looking public
statements concerning the matters described herein. Such
forward-looking statements are necessarily estimates reflecting the
best judgment of the Company's senior management based upon current
information and involve a number of risks and
uncertainties.
Certain factors that could affect the accuracy of such
forward-looking statements and cause actual results to differ
materially from those projected in such forward-looking statements
are identified in the public filings made by the Company with the
SEC, and forward-looking statements contained in this press release
or in other public statements of the Company or its senior
management should be considered in light of those factors. Such
factors may include risk related to the Company's credit, including
that if loan losses are greater than anticipated; the impact of
national and local market conditions on the Company's business and
operations; the rate of growth (or lack thereof) in the economy
generally and in the Company's service areas; strong competition in
the banking industry; the impact of changes in interest rates and
monetary policy on the Company's performance and financial
condition; the pending discontinuation of LIBOR as an interest rate
benchmark; the impact of technological changes in the banking and
financial service industries and potential information system
failures; cybersecurity and data privacy threats; the costs of
complying with extensive governmental regulation; the impact of
changing accounting standards and tax laws on the Company's
allowance for credit losses and financial results; the possibility
that acquisitions may not produce anticipated results and result in
unforeseen integration difficulties; and other risk factors
described from time to time in the Company's public filings,
including, but not limited to, the Company's most recent Annual
Report on Form 10-K. Relative to the Company's dividend policy, the
payment of cash dividends is subject to the discretion of the Board
of Directors and will be determined in light of then-current
conditions, including the Company's earnings, leverage,
operations, financial conditions, capital requirements and other
factors deemed relevant by the Board of Directors. In the future,
the Board of Directors may change the Company's dividend policy,
including the frequency or amount of any dividend, in light of
then-existing conditions.
FIRST US BANCSHARES,
INC. AND SUBSIDIARIES
NET INTEREST MARGIN
THREE MONTHS ENDED
June 30, 2023 AND 2022
(Dollars in
Thousands)
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
Three Months
Ended
|
|
|
|
June 30,
2023
|
|
|
June 30,
2022
|
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans
|
|
$
|
792,382
|
|
|
$
|
11,764
|
|
|
|
5.95
|
%
|
|
$
|
698,696
|
|
|
$
|
8,742
|
|
|
|
5.02
|
%
|
Taxable investment
securities
|
|
|
125,965
|
|
|
|
671
|
|
|
|
2.14
|
%
|
|
|
147,799
|
|
|
|
663
|
|
|
|
1.80
|
%
|
Tax-exempt investment
securities
|
|
|
1,048
|
|
|
|
4
|
|
|
|
1.53
|
%
|
|
|
2,540
|
|
|
|
11
|
|
|
|
1.74
|
%
|
Federal Home Loan Bank
stock
|
|
|
1,415
|
|
|
|
27
|
|
|
|
7.65
|
%
|
|
|
798
|
|
|
|
8
|
|
|
|
4.02
|
%
|
Federal funds
sold
|
|
|
602
|
|
|
|
7
|
|
|
|
4.66
|
%
|
|
|
81
|
|
|
|
1
|
|
|
|
4.95
|
%
|
Interest-bearing
deposits in banks
|
|
|
41,144
|
|
|
|
526
|
|
|
|
5.13
|
%
|
|
|
54,753
|
|
|
|
100
|
|
|
|
0.73
|
%
|
Total interest-earning
assets
|
|
|
962,556
|
|
|
|
12,999
|
|
|
|
5.42
|
%
|
|
|
904,667
|
|
|
|
9,525
|
|
|
|
4.22
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-earning
assets
|
|
|
60,895
|
|
|
|
|
|
|
|
|
|
66,990
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,023,451
|
|
|
|
|
|
|
|
|
$
|
971,657
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
|
$
|
215,645
|
|
|
$
|
185
|
|
|
|
0.34
|
%
|
|
$
|
253,887
|
|
|
$
|
130
|
|
|
|
0.21
|
%
|
Savings
deposits
|
|
|
224,512
|
|
|
|
1,155
|
|
|
|
2.06
|
%
|
|
|
209,982
|
|
|
|
210
|
|
|
|
0.40
|
%
|
Time
deposits
|
|
|
298,418
|
|
|
|
1,982
|
|
|
|
2.66
|
%
|
|
|
205,790
|
|
|
|
244
|
|
|
|
0.48
|
%
|
Total interest-bearing
deposits
|
|
|
738,575
|
|
|
|
3,322
|
|
|
|
1.80
|
%
|
|
|
669,659
|
|
|
|
584
|
|
|
|
0.35
|
%
|
Noninterest-bearing
demand deposits
|
|
|
158,379
|
|
|
|
—
|
|
|
|
—
|
|
|
|
189,600
|
|
|
|
—
|
|
|
|
—
|
|
Total
deposits
|
|
|
896,954
|
|
|
|
3,322
|
|
|
|
1.49
|
%
|
|
|
859,259
|
|
|
|
584
|
|
|
|
0.27
|
%
|
Borrowings
|
|
|
31,633
|
|
|
|
354
|
|
|
|
4.49
|
%
|
|
|
17,569
|
|
|
|
115
|
|
|
|
2.63
|
%
|
Total funding
costs
|
|
|
928,587
|
|
|
|
3,676
|
|
|
|
1.59
|
%
|
|
|
876,828
|
|
|
|
699
|
|
|
|
0.32
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
noninterest-bearing liabilities
|
|
|
9,204
|
|
|
|
|
|
|
|
|
|
8,179
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
85,660
|
|
|
|
|
|
|
|
|
|
86,650
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,023,451
|
|
|
|
|
|
|
|
|
$
|
971,657
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
$
|
9,323
|
|
|
|
|
|
|
|
|
$
|
8,826
|
|
|
|
|
Net interest
margin
|
|
|
|
|
|
|
|
|
3.88
|
%
|
|
|
|
|
|
|
|
|
3.91
|
%
|
FIRST US BANCSHARES,
INC. AND SUBSIDIARIES
NET INTEREST MARGIN
SIX MONTHS ENDED
June 30, 2023 AND 2022
(Dollars in
Thousands)
(Unaudited)
|
|
|
|
Six Months
Ended
|
|
|
Six Months
Ended
|
|
|
|
June 30,
2023
|
|
|
June 30,
2022
|
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans
|
|
$
|
781,686
|
|
|
$
|
22,746
|
|
|
|
5.87
|
%
|
|
$
|
697,701
|
|
|
$
|
17,589
|
|
|
|
5.08
|
%
|
Taxable investment
securities
|
|
|
127,892
|
|
|
|
1,351
|
|
|
|
2.13
|
%
|
|
|
139,101
|
|
|
|
1,148
|
|
|
|
1.66
|
%
|
Tax-exempt investment
securities
|
|
|
1,053
|
|
|
|
7
|
|
|
|
1.34
|
%
|
|
|
2,655
|
|
|
|
23
|
|
|
|
1.75
|
%
|
Federal Home Loan Bank
stock
|
|
|
1,524
|
|
|
|
55
|
|
|
|
7.28
|
%
|
|
|
839
|
|
|
|
16
|
|
|
|
3.85
|
%
|
Federal funds
sold
|
|
|
1,591
|
|
|
|
36
|
|
|
|
4.56
|
%
|
|
|
81
|
|
|
|
1
|
|
|
|
2.49
|
%
|
Interest-bearing
deposits in banks
|
|
|
30,892
|
|
|
|
764
|
|
|
|
4.99
|
%
|
|
|
56,297
|
|
|
|
129
|
|
|
|
0.46
|
%
|
Total interest-earning
assets
|
|
|
944,638
|
|
|
|
24,959
|
|
|
|
5.33
|
%
|
|
|
896,674
|
|
|
|
18,906
|
|
|
|
4.25
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-earning
assets
|
|
|
61,612
|
|
|
|
|
|
|
|
|
|
65,978
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,006,250
|
|
|
|
|
|
|
|
|
$
|
962,652
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
|
$
|
221,480
|
|
|
$
|
381
|
|
|
|
0.35
|
%
|
|
$
|
252,259
|
|
|
$
|
256
|
|
|
|
0.20
|
%
|
Savings
deposits
|
|
|
209,279
|
|
|
|
1,708
|
|
|
|
1.65
|
%
|
|
|
203,535
|
|
|
|
351
|
|
|
|
0.35
|
%
|
Time
deposits
|
|
|
284,433
|
|
|
|
3,370
|
|
|
|
2.39
|
%
|
|
|
208,245
|
|
|
|
493
|
|
|
|
0.48
|
%
|
Total interest-bearing
deposits
|
|
|
715,192
|
|
|
|
5,459
|
|
|
|
1.54
|
%
|
|
|
664,039
|
|
|
|
1,100
|
|
|
|
0.33
|
%
|
Noninterest-bearing
demand deposits
|
|
|
162,441
|
|
|
|
—
|
|
|
|
—
|
|
|
|
182,482
|
|
|
|
—
|
|
|
|
—
|
|
Total
deposits
|
|
|
877,633
|
|
|
|
5,459
|
|
|
|
1.25
|
%
|
|
|
846,521
|
|
|
|
1,100
|
|
|
|
0.26
|
%
|
Borrowings
|
|
|
34,412
|
|
|
|
743
|
|
|
|
4.35
|
%
|
|
|
19,133
|
|
|
|
271
|
|
|
|
2.86
|
%
|
Total funding
costs
|
|
|
912,045
|
|
|
|
6,202
|
|
|
|
1.37
|
%
|
|
|
865,654
|
|
|
|
1,371
|
|
|
|
0.32
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
noninterest-bearing liabilities
|
|
|
9,448
|
|
|
|
|
|
|
|
|
|
8,930
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
84,757
|
|
|
|
|
|
|
|
|
|
88,068
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,006,250
|
|
|
|
|
|
|
|
|
$
|
962,652
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
$
|
18,757
|
|
|
|
|
|
|
|
|
$
|
17,535
|
|
|
|
|
Net interest
margin
|
|
|
|
|
|
|
|
|
4.00
|
%
|
|
|
|
|
|
|
|
|
3.94
|
%
|
FIRST US BANCSHARES,
INC. AND SUBSIDIARIES
INTERIM CONDENSED
CONSOLIDATED BALANCE SHEETS
(Dollars in
Thousands, Except Per Share Data)
|
|
|
|
June 30,
|
|
|
December 31,
|
|
|
|
2023
|
|
|
2022
|
|
|
|
(Unaudited)
|
|
|
|
|
ASSETS
|
|
Cash and due from
banks
|
|
$
|
11,555
|
|
|
$
|
11,844
|
|
Interest-bearing
deposits in banks
|
|
|
63,113
|
|
|
|
18,308
|
|
Total cash and cash
equivalents
|
|
|
74,668
|
|
|
|
30,152
|
|
Federal funds
sold
|
|
|
721
|
|
|
|
1,768
|
|
Investment securities
available-for-sale, at fair value
|
|
|
122,933
|
|
|
|
130,795
|
|
Investment securities
held-to-maturity, at amortized cost
|
|
|
1,471
|
|
|
|
1,862
|
|
Federal Home Loan Bank
stock, at cost
|
|
|
1,802
|
|
|
|
1,359
|
|
Loans held for
investment
|
|
|
814,494
|
|
|
|
773,873
|
|
Less allowance for
credit losses
|
|
|
11,536
|
|
|
|
9,422
|
|
Net loans held for
investment
|
|
|
802,958
|
|
|
|
764,451
|
|
Premises and equipment,
net of accumulated depreciation
|
|
|
24,050
|
|
|
|
24,439
|
|
Cash surrender value of
bank-owned life insurance
|
|
|
16,546
|
|
|
|
16,399
|
|
Accrued interest
receivable
|
|
|
3,151
|
|
|
|
3,011
|
|
Goodwill and core
deposit intangible, net
|
|
|
7,691
|
|
|
|
7,801
|
|
Other real estate
owned
|
|
|
617
|
|
|
|
686
|
|
Other assets
|
|
|
11,518
|
|
|
|
11,944
|
|
Total
assets
|
|
$
|
1,068,126
|
|
|
$
|
994,667
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
Deposits:
|
|
|
|
|
|
|
Non-interest-bearing
|
|
$
|
160,534
|
|
|
$
|
169,822
|
|
Interest-bearing
|
|
|
772,094
|
|
|
|
700,203
|
|
Total
deposits
|
|
|
932,628
|
|
|
|
870,025
|
|
Accrued interest
expense
|
|
|
1,563
|
|
|
|
607
|
|
Other
liabilities
|
|
|
7,447
|
|
|
|
8,136
|
|
Short-term
borrowings
|
|
|
30,000
|
|
|
|
20,038
|
|
Long-term
borrowings
|
|
|
10,763
|
|
|
|
10,726
|
|
Total
liabilities
|
|
|
982,401
|
|
|
|
909,532
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
Common stock, par value
$0.01 per share, 10,000,000 shares authorized; 7,738,156 and
7,680,856 shares issued, respectively; 5,874,765
and 5,812,258 shares outstanding,
respectively
|
|
|
75
|
|
|
|
75
|
|
Additional paid-in
capital
|
|
|
14,675
|
|
|
|
14,510
|
|
Accumulated other
comprehensive loss, net of tax
|
|
|
(8,622)
|
|
|
|
(7,241)
|
|
Retained
earnings
|
|
|
106,157
|
|
|
|
104,460
|
|
Less treasury stock:
1,863,391 and 1,868,598 shares at cost, respectively
|
|
|
(26,560)
|
|
|
|
(26,669)
|
|
Total shareholders'
equity
|
|
|
85,725
|
|
|
|
85,135
|
|
Total liabilities and
shareholders' equity
|
|
$
|
1,068,126
|
|
|
$
|
994,667
|
|
FIRST US BANCSHARES,
INC. AND SUBSIDIARIES
INTERIM CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in
Thousands, Except Per Share Data)
|
|
|
|
Three Months
Ended
|
|
|
Six Months
Ended
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
2023
|
|
|
2022
|
|
|
2023
|
|
|
2022
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Interest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
11,764
|
|
|
$
|
8,742
|
|
|
$
|
22,746
|
|
|
$
|
17,589
|
|
Interest on investment
securities
|
|
|
675
|
|
|
|
674
|
|
|
|
1,358
|
|
|
|
1,171
|
|
Interest on deposits
in banks
|
|
|
526
|
|
|
|
100
|
|
|
|
764
|
|
|
|
129
|
|
Other
|
|
|
34
|
|
|
|
9
|
|
|
|
91
|
|
|
|
17
|
|
Total interest
income
|
|
|
12,999
|
|
|
|
9,525
|
|
|
|
24,959
|
|
|
|
18,906
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
|
3,322
|
|
|
|
584
|
|
|
|
5,459
|
|
|
|
1,100
|
|
Interest on
borrowings
|
|
|
354
|
|
|
|
115
|
|
|
|
743
|
|
|
|
271
|
|
Total interest
expense
|
|
|
3,676
|
|
|
|
699
|
|
|
|
6,202
|
|
|
|
1,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
9,323
|
|
|
|
8,826
|
|
|
|
18,757
|
|
|
|
17,535
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for credit
losses
|
|
|
300
|
|
|
|
895
|
|
|
|
569
|
|
|
|
1,616
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
after provision for credit losses
|
|
|
9,023
|
|
|
|
7,931
|
|
|
|
18,188
|
|
|
|
15,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Service and other
charges on deposit accounts
|
|
|
282
|
|
|
|
294
|
|
|
|
567
|
|
|
|
593
|
|
Lease
income
|
|
|
235
|
|
|
|
211
|
|
|
|
466
|
|
|
|
425
|
|
Other income,
net
|
|
|
282
|
|
|
|
351
|
|
|
|
595
|
|
|
|
667
|
|
Total non-interest
income
|
|
|
799
|
|
|
|
856
|
|
|
|
1,628
|
|
|
|
1,685
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
3,968
|
|
|
|
4,052
|
|
|
|
8,190
|
|
|
|
8,382
|
|
Net occupancy and
equipment
|
|
|
893
|
|
|
|
841
|
|
|
|
1,728
|
|
|
|
1,607
|
|
Computer
services
|
|
|
430
|
|
|
|
430
|
|
|
|
851
|
|
|
|
807
|
|
Insurance expense and
assessments
|
|
|
406
|
|
|
|
293
|
|
|
|
733
|
|
|
|
660
|
|
Fees for professional
services
|
|
|
159
|
|
|
|
280
|
|
|
|
404
|
|
|
|
548
|
|
Other
expense
|
|
|
1,295
|
|
|
|
982
|
|
|
|
2,515
|
|
|
|
1,930
|
|
Total non-interest
expense
|
|
|
7,151
|
|
|
|
6,878
|
|
|
|
14,421
|
|
|
|
13,934
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
|
2,671
|
|
|
|
1,909
|
|
|
|
5,395
|
|
|
|
3,670
|
|
Provision for income
taxes
|
|
|
648
|
|
|
|
494
|
|
|
|
1,300
|
|
|
|
894
|
|
Net income
|
|
$
|
2,023
|
|
|
$
|
1,415
|
|
|
$
|
4,095
|
|
|
$
|
2,776
|
|
Basic net income per
share
|
|
$
|
0.34
|
|
|
$
|
0.23
|
|
|
$
|
0.69
|
|
|
$
|
0.45
|
|
Diluted net income per
share
|
|
$
|
0.31
|
|
|
$
|
0.22
|
|
|
$
|
0.64
|
|
|
$
|
0.42
|
|
Dividends per
share
|
|
$
|
0.05
|
|
|
$
|
0.03
|
|
|
$
|
0.10
|
|
|
$
|
0.06
|
|
Non-GAAP Financial Measures
In addition to the financial results presented in this press
release that have been prepared in accordance with U.S. generally
accepted accounting principles ("GAAP"), the Company's management
believes that certain non-GAAP financial measures and ratios are
beneficial to the reader. These non-GAAP measures have been
provided to enhance overall understanding of the Company's current
financial performance and position. Management believes that these
presentations provide meaningful comparisons of financial
performance and position in various periods and can be used as a
supplement to the GAAP-based measures presented in this press
release. The non-GAAP financial results presented should not be
considered in isolation or as a substitute for the most directly
comparable or other financial measures calculated in accordance
with GAAP. Management believes that both GAAP measures of the
Company's financial performance and the respective non-GAAP
measures should be considered together.
The non-GAAP measures and ratios that have been provided in this
press release include measures of tangible assets and equity and
certain ratios that include tangible assets and equity. Discussion
of these measures and ratios is included below, along with
reconciliations of such non-GAAP measures to GAAP amounts included
in the consolidated financial statements previously presented in
this press release.
Tangible Balances and Measures
In addition to capital ratios defined by GAAP and banking
regulators, the Company utilizes various tangible common equity
measures when evaluating capital utilization and adequacy. These
measures, which are presented in the financial tables in this press
release, may also include calculations of tangible assets. As
defined by the Company, tangible common equity represents
shareholders' equity less goodwill and identifiable intangible
assets, while tangible assets represent total assets less goodwill
and identifiable intangible assets.
Management believes that the measures of tangible equity are
important because they reflect the level of capital available to
withstand unexpected market conditions. In addition, presentation
of these measures allows readers to compare certain aspects of the
Company's capitalization to other organizations. In management's
experience, many stock analysts use tangible common equity measures
in conjunction with more traditional bank capital ratios to compare
capital adequacy of banking organizations with significant amounts
of goodwill or other intangible assets that typically result from
the use of the purchase accounting method in accounting for mergers
and acquisitions.
These calculations are intended to complement the capital ratios
defined by GAAP and banking regulators. Because GAAP does not
include these measures, management believes that there are no
comparable GAAP financial measures to the tangible common equity
ratios that the Company utilizes. Despite the importance of these
measures to the Company, there are no standardized definitions for
the measures, and, therefore, the Company's calculations may not be
comparable with those of other organizations. In addition, there
may be limits to the usefulness of these measures to investors.
Accordingly, management encourages readers to consider the
Company's consolidated financial statements in their entirety and
not to rely on any single financial measure. The table below
reconciles the Company's calculations of these measures to amounts
reported in accordance with GAAP.
|
|
|
|
Quarter
Ended
|
|
|
Six Months
Ended
|
|
|
|
|
|
2023
|
|
|
2022
|
|
|
2023
|
|
|
2022
|
|
|
|
|
|
June
30,
|
|
|
March
31,
|
|
|
December
31,
|
|
|
September
30,
|
|
|
June
30,
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
|
(Dollars in
Thousands, Except Per Share Data)
|
|
|
|
|
|
(Unaudited
Reconciliation)
|
|
TANGIBLE
BALANCES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
$
|
1,068,126
|
|
|
$
|
1,026,658
|
|
|
$
|
994,667
|
|
|
$
|
989,277
|
|
|
$
|
955,385
|
|
|
|
|
|
|
|
Less:
Goodwill
|
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
|
|
|
|
Less: Core deposit
intangible
|
|
|
|
|
256
|
|
|
|
311
|
|
|
|
366
|
|
|
|
421
|
|
|
|
488
|
|
|
|
|
|
|
|
Tangible
assets
|
|
(a)
|
|
$
|
1,060,435
|
|
|
$
|
1,018,912
|
|
|
$
|
986,866
|
|
|
$
|
981,421
|
|
|
$
|
947,462
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
|
$
|
85,725
|
|
|
$
|
84,757
|
|
|
$
|
85,135
|
|
|
$
|
83,103
|
|
|
$
|
82,576
|
|
|
|
|
|
|
|
Less:
Goodwill
|
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
|
|
|
|
Less: Core deposit
intangible
|
|
|
|
|
256
|
|
|
|
311
|
|
|
|
366
|
|
|
|
421
|
|
|
|
488
|
|
|
|
|
|
|
|
Tangible common
equity
|
|
(b)
|
|
$
|
78,034
|
|
|
$
|
77,011
|
|
|
$
|
77,334
|
|
|
$
|
75,247
|
|
|
$
|
74,653
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shareholders'
equity
|
|
|
|
$
|
85,660
|
|
|
$
|
83,837
|
|
|
$
|
83,390
|
|
|
$
|
84,085
|
|
|
$
|
86,650
|
|
|
$
|
84,757
|
|
|
$
|
88,068
|
|
Less: Average
goodwill
|
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
|
|
7,435
|
|
Less: Average core
deposit intangible
|
|
|
|
|
282
|
|
|
|
337
|
|
|
|
392
|
|
|
|
451
|
|
|
|
523
|
|
|
|
310
|
|
|
|
559
|
|
Average tangible
shareholders' equity
|
|
(c)
|
|
$
|
77,943
|
|
|
$
|
76,065
|
|
|
$
|
75,563
|
|
|
$
|
76,199
|
|
|
$
|
78,692
|
|
|
$
|
77,012
|
|
|
$
|
80,074
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
(d)
|
|
$
|
2,023
|
|
|
$
|
2,072
|
|
|
$
|
2,228
|
|
|
$
|
1,860
|
|
|
$
|
1,415
|
|
|
$
|
4,095
|
|
|
$
|
2,776
|
|
Common shares
outstanding (in thousands)
|
|
(e)
|
|
|
5,875
|
|
|
|
5,867
|
|
|
|
5,812
|
|
|
|
5,812
|
|
|
|
5,876
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TANGIBLE
MEASURES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible book value per
common share
|
|
(b)/(e)
|
|
$
|
13.28
|
|
|
$
|
13.13
|
|
|
$
|
13.31
|
|
|
$
|
12.95
|
|
|
$
|
12.70
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common equity
to tangible assets
|
|
(b)/(a)
|
|
|
7.36
|
%
|
|
|
7.56
|
%
|
|
|
7.84
|
%
|
|
|
7.67
|
%
|
|
|
7.88
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
tangible common equity (annualized)
|
|
(1)
|
|
|
10.41
|
%
|
|
|
11.05
|
%
|
|
|
11.70
|
%
|
|
|
9.69
|
%
|
|
|
7.21
|
%
|
|
|
10.72
|
%
|
|
|
6.99
|
%
|
|
|
(1)
|
Calculation of Return
on average tangible common equity (annualized) = ((net income (d) /
number of days in period) * number of days in year) / average
tangible shareholders' equity (c)
|
Contact:
|
Thomas S.
Elley
|
|
205-582-1200
|
View original
content:https://www.prnewswire.com/news-releases/first-us-bancshares-inc-reports-second-quarter-and-year-to-date-earnings-six-month-eps-growth-of-52-over-2022-301886608.html
SOURCE First US Bancshares, Inc.