BIRMINGHAM, Ala., Oct. 25,
2023 /PRNewswire/ -- Third 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
|
$2.1 million
|
$0.33
|
0.80 %
|
9.65 %
|
10.58 %
|
87.9 %
|
First US Bancshares, Inc. (Nasdaq: FUSB) (the "Company"),
the parent company of First US Bank (the "Bank"), today reported
net income of $2.1 million, or
$0.33 per diluted share, for the
quarter ended September 30, 2023
("3Q2023"), compared to $2.0 million,
or $0.31 per diluted share, for the
quarter ended June 30, 2023
("2Q2023") and $1.9 million, or
$0.29 per diluted share, for the
quarter ended September 30, 2022
("3Q2022"). Net income totaled $6.2
million, or $0.97 per diluted
share, for the nine months ended September
30, 2023, compared to $4.6
million, or $0.71 per diluted
share, for the nine months ended September
30, 2022, an increase of 36.6% on diluted earnings per
share.
The table below summarizes selected financial data for each of
the periods presented.
|
|
Quarter
Ended
|
|
|
Nine Months
Ended
|
|
|
|
2023
|
|
|
2022
|
|
|
2023
|
|
|
2022
|
|
|
|
September
30,
|
|
|
June
30,
|
|
|
March
31,
|
|
|
December
31,
|
|
|
September
30,
|
|
|
September
30,
|
|
|
September
30,
|
|
Results of
Operations:
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Interest
income
|
|
$
|
13,902
|
|
|
$
|
12,999
|
|
|
$
|
11,960
|
|
|
$
|
11,621
|
|
|
$
|
10,670
|
|
|
$
|
38,861
|
|
|
$
|
29,576
|
|
Interest
expense
|
|
|
4,419
|
|
|
|
3,676
|
|
|
|
2,526
|
|
|
|
1,730
|
|
|
|
1,155
|
|
|
|
10,621
|
|
|
|
2,526
|
|
Net interest
income
|
|
|
9,483
|
|
|
|
9,323
|
|
|
|
9,434
|
|
|
|
9,891
|
|
|
|
9,515
|
|
|
|
28,240
|
|
|
|
27,050
|
|
Provision for credit
losses
|
|
|
184
|
|
|
|
300
|
|
|
|
269
|
|
|
|
527
|
|
|
|
1,165
|
|
|
|
753
|
|
|
|
2,781
|
|
Net interest income
after provision for credit losses
|
|
|
9,299
|
|
|
|
9,023
|
|
|
|
9,165
|
|
|
|
9,364
|
|
|
|
8,350
|
|
|
|
27,487
|
|
|
|
24,269
|
|
Non-interest
income
|
|
|
837
|
|
|
|
799
|
|
|
|
829
|
|
|
|
678
|
|
|
|
1,088
|
|
|
|
2,465
|
|
|
|
2,773
|
|
Non-interest
expense
|
|
|
7,319
|
|
|
|
7,151
|
|
|
|
7,270
|
|
|
|
7,106
|
|
|
|
7,032
|
|
|
|
21,740
|
|
|
|
20,966
|
|
Income before income
taxes
|
|
|
2,817
|
|
|
|
2,671
|
|
|
|
2,724
|
|
|
|
2,936
|
|
|
|
2,406
|
|
|
|
8,212
|
|
|
|
6,076
|
|
Provision for income
taxes
|
|
|
704
|
|
|
|
648
|
|
|
|
652
|
|
|
|
708
|
|
|
|
546
|
|
|
|
2,004
|
|
|
|
1,440
|
|
Net income
|
|
$
|
2,113
|
|
|
$
|
2,023
|
|
|
$
|
2,072
|
|
|
$
|
2,228
|
|
|
$
|
1,860
|
|
|
$
|
6,208
|
|
|
$
|
4,636
|
|
Per Share
Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income per
share
|
|
$
|
0.35
|
|
|
$
|
0.34
|
|
|
$
|
0.35
|
|
|
$
|
0.37
|
|
|
$
|
0.31
|
|
|
$
|
1.04
|
|
|
$
|
0.76
|
|
Diluted net income per
share
|
|
$
|
0.33
|
|
|
$
|
0.31
|
|
|
$
|
0.33
|
|
|
$
|
0.35
|
|
|
$
|
0.29
|
|
|
$
|
0.97
|
|
|
$
|
0.71
|
|
Dividends
declared
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.03
|
|
|
$
|
0.15
|
|
|
$
|
0.09
|
|
Key Measures (Period
End):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
1,065,239
|
|
|
$
|
1,068,126
|
|
|
$
|
1,026,658
|
|
|
$
|
994,667
|
|
|
$
|
989,277
|
|
|
|
|
|
|
|
Tangible assets
(1)
|
|
|
1,057,597
|
|
|
|
1,060,435
|
|
|
|
1,018,912
|
|
|
|
986,866
|
|
|
|
981,421
|
|
|
|
|
|
|
|
Total loans
|
|
|
815,300
|
|
|
|
814,494
|
|
|
|
775,889
|
|
|
|
773,873
|
|
|
|
750,271
|
|
|
|
|
|
|
|
Allowance for credit
losses
|
|
|
11,380
|
|
|
|
11,536
|
|
|
|
11,599
|
|
|
|
9,422
|
|
|
|
9,373
|
|
|
|
|
|
|
|
Investment securities,
net
|
|
|
127,823
|
|
|
|
124,404
|
|
|
|
128,689
|
|
|
|
132,657
|
|
|
|
145,903
|
|
|
|
|
|
|
|
Total
deposits
|
|
|
927,038
|
|
|
|
932,628
|
|
|
|
897,885
|
|
|
|
870,025
|
|
|
|
846,537
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
|
30,000
|
|
|
|
30,000
|
|
|
|
25,000
|
|
|
|
20,038
|
|
|
|
40,106
|
|
|
|
|
|
|
|
Long-term
borrowings
|
|
|
10,781
|
|
|
|
10,763
|
|
|
|
10,744
|
|
|
|
10,726
|
|
|
|
10,708
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
87,408
|
|
|
|
85,725
|
|
|
|
84,757
|
|
|
|
85,135
|
|
|
|
83,103
|
|
|
|
|
|
|
|
Tangible common equity
(1)
|
|
|
79,766
|
|
|
|
78,034
|
|
|
|
77,011
|
|
|
|
77,334
|
|
|
|
75,247
|
|
|
|
|
|
|
|
Book value per common
share
|
|
|
14.88
|
|
|
|
14.59
|
|
|
|
14.45
|
|
|
|
14.65
|
|
|
|
14.30
|
|
|
|
|
|
|
|
Tangible book value per
common share (1)
|
|
|
13.58
|
|
|
|
13.28
|
|
|
|
13.13
|
|
|
|
13.31
|
|
|
|
12.95
|
|
|
|
|
|
|
|
Key
Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (annualized)
|
|
|
0.80
|
%
|
|
|
0.79
|
%
|
|
|
0.85
|
%
|
|
|
0.90
|
%
|
|
|
0.75
|
%
|
|
|
0.81
|
%
|
|
|
0.64
|
%
|
Return on average
common equity (annualized)
|
|
|
9.65
|
%
|
|
|
9.48
|
%
|
|
|
10.02
|
%
|
|
|
10.60
|
%
|
|
|
8.78
|
%
|
|
|
9.71
|
%
|
|
|
7.15
|
%
|
Return on average
tangible common equity (annualized) (1)
|
|
|
10.58
|
%
|
|
|
10.41
|
%
|
|
|
11.05
|
%
|
|
|
11.70
|
%
|
|
|
9.69
|
%
|
|
|
10.67
|
%
|
|
|
7.87
|
%
|
Net interest
margin
|
|
|
3.79
|
%
|
|
|
3.88
|
%
|
|
|
4.13
|
%
|
|
|
4.27
|
%
|
|
|
4.10
|
%
|
|
|
3.93
|
%
|
|
|
4.00
|
%
|
Efficiency ratio
(2)
|
|
|
70.9
|
%
|
|
|
70.6
|
%
|
|
|
70.8
|
%
|
|
|
67.2
|
%
|
|
|
66.3
|
%
|
|
|
70.8
|
%
|
|
|
70.3
|
%
|
Total loans to
deposits
|
|
|
87.9
|
%
|
|
|
87.3
|
%
|
|
|
86.4
|
%
|
|
|
88.9
|
%
|
|
|
88.6
|
%
|
|
|
|
|
|
|
Total loans to
assets
|
|
|
76.5
|
%
|
|
|
76.3
|
%
|
|
|
75.6
|
%
|
|
|
77.8
|
%
|
|
|
75.8
|
%
|
|
|
|
|
|
|
Common equity to total
assets
|
|
|
8.21
|
%
|
|
|
8.03
|
%
|
|
|
8.26
|
%
|
|
|
8.56
|
%
|
|
|
8.40
|
%
|
|
|
|
|
|
|
Tangible common equity
to tangible assets (1)
|
|
|
7.54
|
%
|
|
|
7.36
|
%
|
|
|
7.56
|
%
|
|
|
7.84
|
%
|
|
|
7.67
|
%
|
|
|
|
|
|
|
Tier 1 leverage ratio
(3)
|
|
|
9.09
|
%
|
|
|
9.19
|
%
|
|
|
9.36
|
%
|
|
|
9.39
|
%
|
|
|
9.23
|
%
|
|
|
|
|
|
|
Allowance for credit
losses as % of loans
|
|
|
1.40
|
%
|
|
|
1.42
|
%
|
|
|
1.49
|
%
|
|
|
1.22
|
%
|
|
|
1.25
|
%
|
|
|
|
|
|
|
Nonperforming assets as
% of total assets
|
|
|
0.29
|
%
|
|
|
0.15
|
%
|
|
|
0.18
|
%
|
|
|
0.24
|
%
|
|
|
0.28
|
%
|
|
|
|
|
|
|
Net charge-offs as a
percentage of average loans
|
|
|
0.10
|
%
|
|
|
0.14
|
%
|
|
|
0.11
|
%
|
|
|
0.25
|
%
|
|
|
0.29
|
%
|
|
|
0.12
|
%
|
|
|
0.24
|
%
|
|
(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 delivered improved operating results in the third quarter
compared to the previous quarter and in the year-to-date results
compared to the prior-year period," stated James F. House, President and CEO of the
Company. "The Company's year-over-year earnings improvement
reflects the impact of our strategic efforts over the past two
years to both transform the Company's asset quality and improve
operating efficiency. As we begin the fourth quarter, we are
executing the final steps to wrap up these efforts, and we are
moving forward with strategic planning efforts for the coming
years," continued Mr. House.
Update on Strategic Initiatives
During the third quarter of 2021, the Company executed strategic
initiatives 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, and
has led to substantial improvement in 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 September 30, 2023,
remaining loans at ALC totaled $12.1
million, compared to $20.2
million as of December 31,
2022. In 2023, as ALC's loans have continued to decrease,
the Company has realized substantially lower levels of net
charge-offs on the portfolio compared to prior periods. Net
charge-offs on ALC loans totaled $0.3
million, or 2.09% of average loans, during the nine months
ended September 30, 2023, compared to
$1.5 million, or 6.38% of average
loans, during the nine months ended September 30, 2022. As of September 30, 2023, $0.2
million, or 1.3% of ALC's loans, were past due, compared to
$0.8 million, or 3.8%, as of
December 31, 2022.
Effective October 1, 2023, the
Company sold all of ALC's remaining loans to the Bank in an
intercompany transaction. The Bank will continue to manage
the remaining loans in the portfolio through final resolution. It
is expected that all other assets and liabilities of ALC will be
transferred to the Bank via an intercompany transaction by the end
2023.
Other 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
|
|
|
September
30,
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
|
September
30,
|
|
|
(Dollars in
Thousands)
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
Real estate
loans:
|
|
|
|
|
|
|
|
|
|
|
Construction, land
development and other land loans
|
|
$90,051
|
|
$91,231
|
|
$69,398
|
|
$53,914
|
|
$36,230
|
Secured by 1-4 family
residential properties
|
|
83,876
|
|
85,101
|
|
86,622
|
|
87,995
|
|
84,452
|
Secured by
multi-family residential properties
|
|
56,506
|
|
54,719
|
|
63,368
|
|
67,852
|
|
72,377
|
Secured by non-farm,
non-residential properties
|
|
199,116
|
|
204,270
|
|
198,266
|
|
200,156
|
|
200,707
|
Commercial and
industrial loans
|
|
59,369
|
|
60,568
|
|
65,708
|
|
73,546
|
|
65,935
|
Consumer
loans:
|
|
|
|
|
|
|
|
|
|
|
Direct
|
|
6,544
|
|
7,593
|
|
8,435
|
|
9,851
|
|
11,950
|
Branch
retail
|
|
9,648
|
|
10,830
|
|
12,222
|
|
13,992
|
|
15,878
|
Indirect
|
|
310,190
|
|
300,182
|
|
271,870
|
|
266,567
|
|
262,742
|
Total loans held for
investment
|
|
$815,300
|
|
$814,494
|
|
$775,889
|
|
$773,873
|
|
$750,271
|
Allowance for credit
losses
|
|
11,380
|
|
11,536
|
|
11,599
|
|
9,422
|
|
9,373
|
Net loans held for
investment
|
|
$803,920
|
|
$802,958
|
|
$764,290
|
|
$764,451
|
|
$740,898
|
Total loan volume increased by $0.8
million, or 0.1%, in 3Q2023. For the nine months ended
September 30, 2023, total loans
increased by $41.4 million, or 5.4%.
Loan volume increases during the first nine months of 2023 were
driven primarily by growth in indirect consumer and commercial
construction loans. Growth in indirect consumer lending was
consistent with continued demand for the
products collateralized through the Company's indirect
program, including recreational vehicles, campers, boats, horse
trailers and cargo trailers. 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. The increase in commercial construction (construction, land
development and other land loans) was primarily attributable to
continued growth in construction fundings on multi-family
residential projects. Loan growth during the first nine months of
2023 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.
Net Interest Income and Margin – Net interest income
totaled $9.5 million in 3Q2023,
compared to $9.3 million in 2Q2023.
Net interest margin was 3.79% in 3Q2023, compared to 3.88% in
2Q2023. Although margin decreased in 3Q2023, net interest income
increased due to growth in average loans, as well as one additional
earning day during the quarter. For the nine months ended
September 30, 2023, net interest
income totaled $28.2 million (net
interest margin of 3.93%), compared to $27.1
million (net interest margin of 4.00%) for the nine months
ended September 30, 2022. The
year-over-year increase in net interest income was primarily
attributable to growth in average loans comparing the two periods.
While yields on earning assets have continued to increase in 2023,
rates on interest-bearing liabilities have increased at a faster
pace, causing margin compression. In the current environment,
management continues to focus efforts on both maintaining and
growing core deposit levels through competitive pricing
strategies.
Deposit Growth – Core deposits, which exclude time
deposits of $250 thousand or more and
all wholesale brokered deposits, increased by $1.1 million during 3Q2023. Core deposits
totaled $786.8 million, or 84.9% of
total deposits as of September 30,
2023, compared to $785.7
million, or 84.2% of total deposits, as of June 30, 2023, and $778.1
million, or 89.4% of total deposits as of December 31, 2022. In total, deposits decreased
by $5.6 million during 3Q2023 due to
the maturity of $10.0 million in
brokered deposits, partially offset by growth in retail deposits.
As of September 30, 2023, total
deposits were $927.0 million,
compared to $870.0 million as of
December 31, 2022. The year-to-date
growth included an increase of $69.2
million in interest bearing deposits, offset by a decrease
of $12.2 million in
noninterest-bearing deposits. The shift to interest-bearing
deposits in 2023 is consistent with deposit holders seeking to
maximize interest earnings on their accounts in the current
interest rate environment. In addition, interest bearing deposit
growth during the nine months ended September 30, 2023 included net growth of
$30.2 million in brokered deposits
that were acquired in order to further enhance the Company's
liquidity position following the bank failures that occurred during
the early months of 2023.
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. Following the bank failures that
occurred during the early months of 2023, management has focused
effort on maintaining and growing the Company's strong liquidity
position. These efforts have included holding higher levels of cash
and cash equivalents on the Company's balance sheet. Cash and cash
equivalents totaled $66.1 million as
of September 30, 2023, compared to
$74.7 million as of June 30, 2023, and $30.2
million as of December 31,
2022. Investment securities, including both the
available-for-sale and held-to-maturity portfolios, totaled
$127.8 million as of September 30, 2023, compared to $124.4 million as of June
30, 2023, and $132.7 million
as of December 31, 2022. The expected
average life of securities in the investment portfolio was 3.9
years as of September 30, 2023,
compared to 3.5 years as of December 31,
2022.
Provision for Credit Losses – The Company recorded
provisions for credit losses totaling $0.2
million during 3Q2023, compared to $0.3 million during 2Q2023 and $1.2 million during 3Q2022. Credit loss
provisioning has decreased significantly in 2023 compared to 2022
primarily due to the cessation of business strategy at ALC which
has led to significantly reduced net charge-offs as ALC's loans
have decreased. For the nine months ended September 30, 2023, the provision for credit
losses totaled $0.8 million, compared
to $2.8 million for the nine months
ended September 30, 2022.
The tables below summarize changes in the Company's allowance
for credit losses on loans during the first nine 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
Nine Months Ended September 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
|
|
—
|
|
(96)
|
|
—
|
|
—
|
|
—
|
|
(521)
|
|
(359)
|
|
(500)
|
|
(1,476)
|
Recoveries
|
|
—
|
|
39
|
|
—
|
|
—
|
|
—
|
|
499
|
|
195
|
|
40
|
|
773
|
Provision
|
|
157
|
|
18
|
|
(156)
|
|
(201)
|
|
(369)
|
|
(404)
|
|
(147)
|
|
1,640
|
|
538
|
Ending
balance
|
|
$580
|
|
$754
|
|
$405
|
|
$1,622
|
|
$530
|
|
$487
|
|
$835
|
|
$6,167
|
|
$11,380
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 %
|
September 30,
2023
|
|
0.64 %
|
|
0.90 %
|
|
0.72 %
|
|
0.81 %
|
|
0.89 %
|
|
7.44 %
|
|
8.65 %
|
|
1.99 %
|
|
1.40 %
|
In addition to the provision for credit losses on loans noted in
the table above, the Company recorded $0.2
million to the provision for credit losses associated with
unfunded lending commitments during the nine months ended
September 30, 2023.
Non-interest Income – Non-interest income totaled $0.8 million in both 3Q2023 and 2Q2023, compared
to $1.1 million in 3Q2022. For the
nine months ended September 30, 2023,
non-interest income totaled $2.5
million, compared to $2.8
million for the nine months ended September 30, 2022. The reduction in both
quarterly and year-to-date non-interest income in 2023 compared to
2022 resulted from gains on the sale of premises and equipment that
occurred during 3Q2022, but were not repeated in 2023.
Non-interest Expense – Non-interest expense totaled $7.3 million in 3Q2023, compared to $7.2 million in 2Q2023, and $7.0 million in 3Q2022. For the nine months
ended September 30, 2023, non-interest expense totaled
$21.7 million, compared to
$21.0 million for the nine months
ended September 30, 2022. The increase comparing both the
three- and nine-month periods of 2023 and 2022 resulted from
nonrecurring gains on the sale of OREO properties that offset
non-interest expense in 2022, but were not repeated in 2023.
Asset Quality – Nonperforming assets, including loans in
non-accrual status and OREO, totaled $3.0
million as of September 30,
2023, compared to $1.6 million
as of June 30, 2023 and $2.3 million as of December 31, 2022. The increase in nonperforming
assets resulted primarily from one commercial real estate loan that
moved into nonaccrual status during 3Q2023. As a percentage of
total assets, nonperforming assets totaled 0.29% as of September 30, 2023, compared to 0.15% as of
June 30, 2023 and 0.24% as of
December 31, 2022. Net charge-offs as
a percentage of average loans decreased to 0.10% during 3Q2023,
compared to 0.14% during 2Q2023 and 0.29% during 3Q2022. For the
nine months ended September 30, 2023,
net charge-offs totaled 0.12%, compared to 0.24% for the nine
months ended September 30, 2022. The
decrease in net charge-offs comparing the 2023 periods to 2022
resulted primarily from favorable trends on charge-off experience
on legacy ALC loans.
Shareholders' Equity – As of September 30,
2023, shareholders' equity totaled $87.4
million, or 8.2% 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, partially 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
$1.7 million associated with fair
value declines in the available-for-sale investment portfolio and
reclassification adjustments associated with terminated interest
rate swaps. As of September 30, 2023,
the Company's ratio of common equity to total assets was 8.21%,
compared to 8.56% as of December 31,
2022, while the Company's ratio of tangible common equity to
tangible assets was 7.54% as of September
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 3Q2023, consistent with the previous two quarters of 2023, and
the fourth quarter of 2022. Cash dividends totaled $0.15 per share for the nine months ended
September 30, 2023, compared to
$0.09 per common share for the nine
months ended September 30,
2022.
Regulatory Capital – During 3Q2023, 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 September 30,
2023, the Bank's common equity Tier 1 capital and Tier 1
risk-based capital ratios were each 10.81%, its total capital ratio
was 12.06%, and its Tier 1 leverage ratio was 9.09%.
Liquidity – As of September 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 Bank's (FRB) discount window and its Bank Term Funding
Program (BTFP), the latter of which was established during 2023 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
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.
Excluding wholesale brokered deposits, as of September 30, 2023, the Company had approximately
29 thousand deposit accounts with an average balance of
approximately $28.9 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
$173.0 million, or 18.7% of total
deposits, as of September 30, 2023.
As of December 31, 2022, estimated
uninsured deposits totaled $148.3
million, or 17.1% of total deposits.
In response to heightened liquidity concerns in the banking
industry, during 2023 management undertook measures designed to
enhance the Company's liquidity position. These procedures included
holding higher levels of on-balance sheet cash, as well as
enhancing the availability of off-balance sheet borrowing capacity.
As part of these efforts, during 3Q2023, the Company completed the
establishment of additional borrowing capacity through the FRB's
discount window, primarily via the pledging of the majority of the
Company's indirect loan portfolio as collateral. Due to these
efforts, the Company's immediate borrowing capacity based on
collateral pledged through the discount window increased to
$146.6 million as of September 30, 2023, compared to $1.2 million as of December 31, 2022.
The table below provides information on the Company's on-balance
sheet liquidity, as well as readily available sources of liquidity
as of both September 30, 2023 and
December 31, 2022.
|
September 30,
2023
|
|
|
December 31,
2022
|
|
|
(Dollars in
Thousands)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Liquidity from cash and
federal funds sold:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
66,129
|
|
|
$
|
30,152
|
|
Federal funds
sold
|
|
1,143
|
|
|
|
1,768
|
|
Liquidity from cash
and federal funds sold
|
|
67,272
|
|
|
|
31,920
|
|
Liquidity from
pledgable investment securities:
|
|
|
|
|
|
Investment securities
available-for sale, at fair value
|
|
126,551
|
|
|
|
130,795
|
|
Investment securities
held-to-maturity, at amortized cost
|
|
1,272
|
|
|
|
1,862
|
|
Less: securities
pledged
|
|
(42,340)
|
|
|
|
(54,717)
|
|
Less: estimated
collateral value discounts
|
|
(10,943)
|
|
|
|
(7,833)
|
|
Liquidity from
pledgable investment securities
|
|
74,540
|
|
|
|
70,107
|
|
Liquidity from unused
lendable collateral (loans) at FHLB
|
|
6,676
|
|
|
|
18,215
|
|
Liquidity from unused
lendable collateral (loans and securities) at FRB
|
|
146,613
|
|
|
|
1,198
|
|
Unsecured lines of
credit with banks
|
|
48,000
|
|
|
|
45,000
|
|
Total readily
available liquidity
|
$
|
343,101
|
|
|
$
|
166,440
|
|
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
FRB 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 FRB 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 FRB 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 September 30, 2023
and December 31, 2022, the Company's
total remaining credit availability with the FHLB was $260.3 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 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 and the Company's Quarterly Report on Form 10-Q
for the fiscal quarter ended June 30,
2023. 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
September 30, 2023 AND 2022
|
(Dollars in
Thousands)
|
(Unaudited)
|
|
|
|
|
Three Months
Ended
|
|
|
Three Months
Ended
|
|
|
|
September 30,
2023
|
|
|
September 30,
2022
|
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans
|
|
$
|
821,294
|
|
|
$
|
12,584
|
|
|
|
6.08
|
%
|
|
$
|
743,145
|
|
|
$
|
9,750
|
|
|
|
5.21
|
%
|
Taxable investment
securities
|
|
|
123,290
|
|
|
|
682
|
|
|
|
2.19
|
%
|
|
|
148,964
|
|
|
|
748
|
|
|
|
1.99
|
%
|
Tax-exempt investment
securities
|
|
|
1,037
|
|
|
|
3
|
|
|
|
1.15
|
%
|
|
|
2,322
|
|
|
|
8
|
|
|
|
1.37
|
%
|
Federal Home Loan Bank
stock
|
|
|
1,001
|
|
|
|
21
|
|
|
|
8.32
|
%
|
|
|
1,808
|
|
|
|
17
|
|
|
|
3.73
|
%
|
Federal funds
sold
|
|
|
1,069
|
|
|
|
14
|
|
|
|
5.20
|
%
|
|
|
1,984
|
|
|
|
11
|
|
|
|
2.20
|
%
|
Interest-bearing
deposits in banks
|
|
|
44,379
|
|
|
|
598
|
|
|
|
5.35
|
%
|
|
|
23,166
|
|
|
|
136
|
|
|
|
2.33
|
%
|
Total interest-earning
assets
|
|
|
992,070
|
|
|
|
13,902
|
|
|
|
5.56
|
%
|
|
|
921,389
|
|
|
|
10,670
|
|
|
|
4.59
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-earning
assets
|
|
|
61,235
|
|
|
|
|
|
|
|
|
|
64,593
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,053,305
|
|
|
|
|
|
|
|
|
$
|
985,982
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
|
$
|
206,540
|
|
|
$
|
176
|
|
|
|
0.34
|
%
|
|
$
|
243,131
|
|
|
$
|
182
|
|
|
|
0.30
|
%
|
Savings
deposits
|
|
|
244,932
|
|
|
|
1,570
|
|
|
|
2.54
|
%
|
|
|
211,724
|
|
|
|
342
|
|
|
|
0.64
|
%
|
Time
deposits
|
|
|
323,824
|
|
|
|
2,476
|
|
|
|
3.03
|
%
|
|
|
209,361
|
|
|
|
340
|
|
|
|
0.64
|
%
|
Total interest-bearing
deposits
|
|
|
775,296
|
|
|
|
4,222
|
|
|
|
2.16
|
%
|
|
|
664,216
|
|
|
|
864
|
|
|
|
0.52
|
%
|
Noninterest-bearing
demand deposits
|
|
|
161,381
|
|
|
|
—
|
|
|
|
—
|
|
|
|
183,612
|
|
|
|
—
|
|
|
|
—
|
|
Total
deposits
|
|
|
936,677
|
|
|
|
4,222
|
|
|
|
1.79
|
%
|
|
|
847,828
|
|
|
|
864
|
|
|
|
0.40
|
%
|
Borrowings
|
|
|
19,468
|
|
|
|
197
|
|
|
|
4.01
|
%
|
|
|
45,427
|
|
|
|
291
|
|
|
|
2.54
|
%
|
Total funding
costs
|
|
|
956,145
|
|
|
|
4,419
|
|
|
|
1.83
|
%
|
|
|
893,255
|
|
|
|
1,155
|
|
|
|
0.51
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
noninterest-bearing liabilities
|
|
|
10,263
|
|
|
|
|
|
|
|
|
|
8,642
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
86,897
|
|
|
|
|
|
|
|
|
|
84,085
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,053,305
|
|
|
|
|
|
|
|
|
$
|
985,982
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
$
|
9,483
|
|
|
|
|
|
|
|
|
$
|
9,515
|
|
|
|
|
Net interest
margin
|
|
|
|
|
|
|
|
|
3.79
|
%
|
|
|
|
|
|
|
|
|
4.10
|
%
|
FIRST
US BANCSHARES, INC. AND SUBSIDIARIES
|
NET INTEREST MARGIN
|
NINE MONTHS ENDED
September 30, 2023 AND 2022
|
(Dollars in
Thousands)
|
(Unaudited)
|
|
|
|
Nine Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
September 30,
2023
|
|
|
September 30,
2022
|
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
|
Average
Balance
|
|
|
Interest
|
|
|
Annualized
Yield/
Rate %
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans
|
|
$
|
795,033
|
|
|
$
|
35,330
|
|
|
|
5.94
|
%
|
|
$
|
713,015
|
|
|
$
|
27,339
|
|
|
|
5.13
|
%
|
Taxable investment
securities
|
|
|
126,341
|
|
|
|
2,033
|
|
|
|
2.15
|
%
|
|
|
142,425
|
|
|
|
1,896
|
|
|
|
1.78
|
%
|
Tax-exempt investment
securities
|
|
|
1,048
|
|
|
|
10
|
|
|
|
1.28
|
%
|
|
|
2,543
|
|
|
|
31
|
|
|
|
1.63
|
%
|
Federal Home Loan Bank
stock
|
|
|
1,347
|
|
|
|
75
|
|
|
|
7.44
|
%
|
|
|
1,165
|
|
|
|
33
|
|
|
|
3.79
|
%
|
Federal funds
sold
|
|
|
1,415
|
|
|
|
51
|
|
|
|
4.82
|
%
|
|
|
853
|
|
|
|
12
|
|
|
|
1.88
|
%
|
Interest-bearing
deposits in banks
|
|
|
35,437
|
|
|
|
1,362
|
|
|
|
5.14
|
%
|
|
|
45,133
|
|
|
|
265
|
|
|
|
0.79
|
%
|
Total interest-earning
assets
|
|
|
960,621
|
|
|
|
38,861
|
|
|
|
5.41
|
%
|
|
|
905,134
|
|
|
|
29,576
|
|
|
|
4.37
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-earning
assets
|
|
|
61,484
|
|
|
|
|
|
|
|
|
|
65,379
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,022,105
|
|
|
|
|
|
|
|
|
$
|
970,513
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand
deposits
|
|
$
|
216,445
|
|
|
$
|
557
|
|
|
|
0.34
|
%
|
|
$
|
249,183
|
|
|
$
|
438
|
|
|
|
0.24
|
%
|
Savings
deposits
|
|
|
221,293
|
|
|
|
3,279
|
|
|
|
1.98
|
%
|
|
|
206,294
|
|
|
|
693
|
|
|
|
0.45
|
%
|
Time
deposits
|
|
|
297,708
|
|
|
|
5,845
|
|
|
|
2.62
|
%
|
|
|
208,621
|
|
|
|
833
|
|
|
|
0.53
|
%
|
Total interest-bearing
deposits
|
|
|
735,446
|
|
|
|
9,681
|
|
|
|
1.76
|
%
|
|
|
664,098
|
|
|
|
1,964
|
|
|
|
0.40
|
%
|
Noninterest-bearing
demand deposits
|
|
|
162,084
|
|
|
|
—
|
|
|
|
—
|
|
|
|
182,862
|
|
|
|
—
|
|
|
|
—
|
|
Total
deposits
|
|
|
897,530
|
|
|
|
9,681
|
|
|
|
1.44
|
%
|
|
|
846,960
|
|
|
|
1,964
|
|
|
|
0.31
|
%
|
Borrowings
|
|
|
29,375
|
|
|
|
940
|
|
|
|
4.28
|
%
|
|
|
27,994
|
|
|
|
562
|
|
|
|
2.68
|
%
|
Total funding
costs
|
|
|
926,905
|
|
|
|
10,621
|
|
|
|
1.53
|
%
|
|
|
874,954
|
|
|
|
2,526
|
|
|
|
0.39
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
noninterest-bearing liabilities
|
|
|
9,722
|
|
|
|
|
|
|
|
|
|
8,833
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
85,478
|
|
|
|
|
|
|
|
|
|
86,726
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,022,105
|
|
|
|
|
|
|
|
|
$
|
970,513
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
$
|
28,240
|
|
|
|
|
|
|
|
|
$
|
27,050
|
|
|
|
|
Net interest
margin
|
|
|
|
|
|
|
|
|
3.93
|
%
|
|
|
|
|
|
|
|
|
4.00
|
%
|
FIRST
US BANCSHARES, INC. AND SUBSIDIARIES
|
INTERIM CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Dollars in
Thousands, Except Per Share Data)
|
|
|
|
September 30,
|
|
|
December 31,
|
|
|
|
2023
|
|
|
2022
|
|
|
|
(Unaudited)
|
|
|
|
|
ASSETS
|
|
Cash and due from
banks
|
|
$
|
10,311
|
|
|
$
|
11,844
|
|
Interest-bearing
deposits in banks
|
|
|
55,818
|
|
|
|
18,308
|
|
Total cash and cash
equivalents
|
|
|
66,129
|
|
|
|
30,152
|
|
Federal funds
sold
|
|
|
1,143
|
|
|
|
1,768
|
|
Investment securities
available-for-sale, at fair value
|
|
|
126,551
|
|
|
|
130,795
|
|
Investment securities
held-to-maturity, at amortized cost
|
|
|
1,272
|
|
|
|
1,862
|
|
Federal Home Loan Bank
stock, at cost
|
|
|
2,151
|
|
|
|
1,359
|
|
Loans held for
investment
|
|
|
815,300
|
|
|
|
773,873
|
|
Less allowance for
credit losses
|
|
|
11,380
|
|
|
|
9,422
|
|
Net loans held for
investment
|
|
|
803,920
|
|
|
|
764,451
|
|
Premises and equipment,
net of accumulated depreciation
|
|
|
24,259
|
|
|
|
24,439
|
|
Cash surrender value of
bank-owned life insurance
|
|
|
16,622
|
|
|
|
16,399
|
|
Accrued interest
receivable
|
|
|
3,522
|
|
|
|
3,011
|
|
Goodwill and core
deposit intangible, net
|
|
|
7,642
|
|
|
|
7,801
|
|
Other real estate
owned
|
|
|
617
|
|
|
|
686
|
|
Other assets
|
|
|
11,411
|
|
|
|
11,944
|
|
Total
assets
|
|
$
|
1,065,239
|
|
|
$
|
994,667
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
Deposits:
|
|
|
|
|
|
|
Non-interest-bearing
|
|
$
|
157,652
|
|
|
$
|
169,822
|
|
Interest-bearing
|
|
|
769,386
|
|
|
|
700,203
|
|
Total
deposits
|
|
|
927,038
|
|
|
|
870,025
|
|
Accrued interest
expense
|
|
|
1,864
|
|
|
|
607
|
|
Other
liabilities
|
|
|
8,148
|
|
|
|
8,136
|
|
Short-term
borrowings
|
|
|
30,000
|
|
|
|
20,038
|
|
Long-term
borrowings
|
|
|
10,781
|
|
|
|
10,726
|
|
Total
liabilities
|
|
|
977,831
|
|
|
|
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; 5,874,781
and 5,812,258 shares outstanding,
respectively
|
|
|
75
|
|
|
|
75
|
|
Additional paid-in
capital
|
|
|
14,824
|
|
|
|
14,510
|
|
Accumulated other
comprehensive loss, net of tax
|
|
|
(8,907)
|
|
|
|
(7,241)
|
|
Retained
earnings
|
|
|
107,976
|
|
|
|
104,460
|
|
Less treasury stock:
1,863,375 and 1,868,598 shares at cost, respectively
|
|
|
(26,560)
|
|
|
|
(26,669)
|
|
Total shareholders'
equity
|
|
|
87,408
|
|
|
|
85,135
|
|
Total liabilities and
shareholders' equity
|
|
$
|
1,065,239
|
|
|
$
|
994,667
|
|
FIRST
US BANCSHARES, INC. AND SUBSIDIARIES
|
INTERIM CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Dollars in
Thousands, Except Per Share Data)
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2023
|
|
|
2022
|
|
|
2023
|
|
|
2022
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Interest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
12,584
|
|
|
$
|
9,750
|
|
|
$
|
35,330
|
|
|
$
|
27,339
|
|
Interest on investment
securities
|
|
|
685
|
|
|
|
756
|
|
|
|
2,043
|
|
|
|
1,927
|
|
Interest on deposits
in banks
|
|
|
598
|
|
|
|
136
|
|
|
|
1,362
|
|
|
|
265
|
|
Other
|
|
|
35
|
|
|
|
28
|
|
|
|
126
|
|
|
|
45
|
|
Total interest
income
|
|
|
13,902
|
|
|
|
10,670
|
|
|
|
38,861
|
|
|
|
29,576
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
|
4,222
|
|
|
|
864
|
|
|
|
9,681
|
|
|
|
1,964
|
|
Interest on
borrowings
|
|
|
197
|
|
|
|
291
|
|
|
|
940
|
|
|
|
562
|
|
Total interest
expense
|
|
|
4,419
|
|
|
|
1,155
|
|
|
|
10,621
|
|
|
|
2,526
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
9,483
|
|
|
|
9,515
|
|
|
|
28,240
|
|
|
|
27,050
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for credit
losses
|
|
|
184
|
|
|
|
1,165
|
|
|
|
753
|
|
|
|
2,781
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
after provision for credit losses
|
|
|
9,299
|
|
|
|
8,350
|
|
|
|
27,487
|
|
|
|
24,269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Service and other
charges on deposit accounts
|
|
|
302
|
|
|
|
311
|
|
|
|
869
|
|
|
|
904
|
|
Lease
income
|
|
|
241
|
|
|
|
210
|
|
|
|
707
|
|
|
|
635
|
|
Other income,
net
|
|
|
294
|
|
|
|
567
|
|
|
|
889
|
|
|
|
1,234
|
|
Total non-interest
income
|
|
|
837
|
|
|
|
1,088
|
|
|
|
2,465
|
|
|
|
2,773
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
4,120
|
|
|
|
4,007
|
|
|
|
12,310
|
|
|
|
12,389
|
|
Net occupancy and
equipment
|
|
|
897
|
|
|
|
861
|
|
|
|
2,625
|
|
|
|
2,468
|
|
Computer
services
|
|
|
464
|
|
|
|
417
|
|
|
|
1,315
|
|
|
|
1,224
|
|
Insurance expense and
assessments
|
|
|
423
|
|
|
|
310
|
|
|
|
1,156
|
|
|
|
970
|
|
Fees for professional
services
|
|
|
331
|
|
|
|
263
|
|
|
|
735
|
|
|
|
811
|
|
Other
expense
|
|
|
1,084
|
|
|
|
1,174
|
|
|
|
3,599
|
|
|
|
3,104
|
|
Total non-interest
expense
|
|
|
7,319
|
|
|
|
7,032
|
|
|
|
21,740
|
|
|
|
20,966
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
|
2,817
|
|
|
|
2,406
|
|
|
|
8,212
|
|
|
|
6,076
|
|
Provision for income
taxes
|
|
|
704
|
|
|
|
546
|
|
|
|
2,004
|
|
|
|
1,440
|
|
Net income
|
|
$
|
2,113
|
|
|
$
|
1,860
|
|
|
$
|
6,208
|
|
|
$
|
4,636
|
|
Basic net income per
share
|
|
$
|
0.35
|
|
|
$
|
0.31
|
|
|
$
|
1.04
|
|
|
$
|
0.76
|
|
Diluted net income per
share
|
|
$
|
0.33
|
|
|
$
|
0.29
|
|
|
$
|
0.97
|
|
|
$
|
0.71
|
|
Dividends per
share
|
|
$
|
0.05
|
|
|
$
|
0.03
|
|
|
$
|
0.15
|
|
|
$
|
0.09
|
|
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
|
|
Nine Months
Ended
|
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
September
30,
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
|
September
30,
|
|
September
30,
|
|
September
30,
|
|
|
|
|
(Dollars in
Thousands, Except Per Share Data)
|
|
|
|
|
(Unaudited
Reconciliation)
|
TANGIBLE
BALANCES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
$1,065,239
|
|
$1,068,126
|
|
$1,026,658
|
|
$994,667
|
|
$989,277
|
|
|
|
|
Less:
Goodwill
|
|
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
|
|
|
|
Less: Core deposit
intangible
|
|
|
|
207
|
|
256
|
|
311
|
|
366
|
|
421
|
|
|
|
|
Tangible
assets
|
|
(a)
|
|
$1,057,597
|
|
$1,060,435
|
|
$1,018,912
|
|
$986,866
|
|
$981,421
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
|
$87,408
|
|
$85,725
|
|
$84,757
|
|
$85,135
|
|
$83,103
|
|
|
|
|
Less:
Goodwill
|
|
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
|
|
|
|
Less: Core deposit
intangible
|
|
|
|
207
|
|
256
|
|
311
|
|
366
|
|
421
|
|
|
|
|
Tangible common
equity
|
|
(b)
|
|
$79,766
|
|
$78,034
|
|
$77,011
|
|
$77,334
|
|
$75,247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shareholders'
equity
|
|
|
|
$86,897
|
|
$85,660
|
|
$83,837
|
|
$83,390
|
|
$84,085
|
|
$85,478
|
|
$86,726
|
Less: Average
goodwill
|
|
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
|
7,435
|
Less: Average core
deposit intangible
|
|
|
|
229
|
|
282
|
|
337
|
|
392
|
|
451
|
|
282
|
|
523
|
Average tangible
shareholders' equity
|
|
(c)
|
|
$79,233
|
|
$77,943
|
|
$76,065
|
|
$75,563
|
|
$76,199
|
|
$77,761
|
|
$78,768
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
(d)
|
|
$2,113
|
|
$2,023
|
|
$2,072
|
|
$2,228
|
|
$1,860
|
|
$6,208
|
|
$4,636
|
Common shares
outstanding (in thousands)
|
|
(e)
|
|
5,875
|
|
5,875
|
|
5,867
|
|
5,812
|
|
5,812
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TANGIBLE
MEASURES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible book value per
common share
|
|
(b)/(e)
|
|
$13.58
|
|
$13.28
|
|
$13.13
|
|
$13.31
|
|
$12.95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common equity
to tangible assets
|
|
(b)/(a)
|
|
7.54 %
|
|
7.36 %
|
|
7.56 %
|
|
7.84 %
|
|
7.67 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
tangible common equity (annualized)
|
|
(1)
|
|
10.58 %
|
|
10.41 %
|
|
11.05 %
|
|
11.70 %
|
|
9.69 %
|
|
10.67 %
|
|
7.87 %
|
|
|
(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-third-quarter-and-year-to-date-earnings-nine-month-eps-growth-of-36-6-over-2022--301966734.html
SOURCE First US Bancshares, Inc.