SOURCE: Elmira Savings Bank

Elmira Savings Bank

October 21, 2015 13:31 ET

Elmira Savings Bank Reports Increase in Quarterly Earnings

ELMIRA, NY--(Marketwired - Oct 21, 2015) - Elmira Savings Bank (NASDAQ: ESBK)

Highlights

  • Net income was $1,057,000 and $3,086,000 for the three and nine months ended September 30, 2015 compared to $475,000 and $2,634,000 for the same periods in 2014.

  • Diluted earnings per share were $.30 per share and $.87 per share for the three and nine months ended September 30, 2015 compared to $.09 per share and $.70 per share for the same periods in 2014. 

  • Return on average assets was .73% for both the three and nine months ended September 30, 2015 compared to .36% and .68% for the same periods in 2014.

  • Return on average equity was 7.60% and 7.43% for the three and nine months ended September 30, 2015 compared to 3.36% and 6.35% for the same periods in 2014.

"We are pleased with the increase in core earnings supported by loan and deposit growth," said Thomas M. Carr, President and CEO. "During the quarter we experienced strong mortgage originations and are pleased with our reception in the Watkins Glen market," continued Mr. Carr.

Net Income

Net income totaled $3,086,000 for the nine months ended September 30, 2015, an increase of $452,000 or 17% from the $2,634,000 of net income recorded for the same period in 2014. This increase was the net result of an increase in noninterest income of $291,000, an increase in net interest income of $112,000, and a decrease in noninterest expense of $281,000, offset by an increase in the provision for loan losses of $93,000 and an increase in tax expense of $139,000.

Net income totaled $1,057,000 for the three months ended September 30, 2015, an increase of $582,000 or 123% from the $475,000 recorded for the same period in 2014. This increase was the net result of a decrease in noninterest expense of $465,000, an increase in noninterest income of $384,000, and an increase in net interest income of $50,000, offset by an increase in tax expense of $285,000 and an increase in the provision for loan losses of $32,000.

The decrease in noninterest expense for both the three and nine months ended September 30, 2015 versus the same periods in 2014 includes the impact of $820,000 of one-time expense recognized in the third quarter of 2014. This one-time expense was for the estimated value of an executive retirement compensation agreement.

Net income of $1,057,000 for the current quarter ended September 30, 2015 increased $38,000 or 4% from net income for the preceding quarter ended June 30, 2015.

Basic and diluted earnings per share for the nine months ended September 30, 2015 were $.89 per share and $.87 per share compared to $.73 per share and $.70 per share for the same period in 2014. Basic and diluted earnings per share for the three months ended September 30, 2015 were $.31 per share and $.30 per share compared to $.09 per share for both basic and diluted earnings per share for the same period in 2014.

Net Interest Margin

The net interest margin for the nine months ended September 30, 2015 was 3.03% compared to 3.23% for the same period in 2014. The yield on average earning assets was 4.05% for the nine months ended September 30, 2015 compared to 4.25% for the same period in 2014. The average cost of interest-bearing liabilities was 1.19% for the nine months ended September 30, 2015 compared to 1.22% for the same period in 2014.

The net interest margin for the three months ended September 30, 2015 was 2.97% compared to 3.18% for the same period in 2014. The average yield on earning assets was 4.00% for the three months ended September 30, 2015 compared to 4.19% for the same period in 2014. The average cost of interest-bearing liabilities was 1.20% for the three months ended September 30, 2015 compared to 1.21% for the same period in 2014.

Assets

Total assets increased $20.3 million or 3.7% to $566.2 million at September 30, 2015 compared to $546.0 million at December 31, 2014. Loans, including loans held for sale, increased 6.7% to $446.2 million at September 30, 2015 compared to December 31, 2014. The available-for-sale investment portfolio decreased $15.1 million from December 31, 2014 to September 30, 2015.

Nonperforming Loans

Our nonperforming loans to total loans ratio has decreased to 1.01% at September 30, 2015 from 1.13% at December 31, 2014. Net loan charge-offs to average loans for the nine months ended September 30, 2015 of 0.08% increased from 0.06% for the nine months ended September 30, 2014. The allowance for loan losses was 0.92% of total loans at September 30, 2015 and 0.95% of total loans at December 31, 2014.

Liabilities

Deposits total $442.0 million at September 30, 2015, an increase of $19.5 million or 4.6%. The $19.5 million increase consists of a $6.2 million increase in interest-bearing transaction accounts, a $10.3 million increase in noninterest-bearing accounts, and a $4.5 million increase in time deposits, partially offset by a $0.9 million decrease in savings accounts and a $0.6 million decrease in money market accounts. Borrowed funds increased by $1.0 million or 1.6%.

Shareholders' Equity

Shareholders' equity decreased $0.8 million to $54.7 million at September 30, 2015 compared to December 31, 2014. The decrease is primarily the result of the repurchase of a warrant in May 2015 that had been issued to the United States Treasury Department at a purchase price of $1.5 million. The current level of shareholders' equity equates to a book value per share of $16.49 at September 30, 2015, compared to $16.91 at December 31, 2014. Dividends paid to common shareholders were $0.23 and $0.69 for the three and nine months ended for both September 30, 2015 and 2014.

Elmira Savings Bank, with $566.2 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with six offices in Chemung County, NY; three offices and a loan center in Tompkins County, NY; two offices in Steuben County, NY; one office in Cayuga County, NY; one office in Schuyler County; a loan center in Cortland County, NY; and a loan center in Broome County, NY.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank's regulatory reports.

                   
                   
ELMIRA SAVINGS BANK  
CONSOLIDATED BALANCE SHEET  
(unaudited)  
                   
(in thousands, except for share and per share data)   September 30,     December 31,        
    2015     2014     % Change  
ASSETS                      
                       
Cash and due from banks   $ 12,916     $ 7,959     62.3 %
Federal funds sold and other short-term investments     102       606     -83.2 %
  Total cash and cash equivalents     13,018       8,565     52.0 %
                       
Securities available for sale, at fair value     50,509       65,624     -23.0 %
Securities held to maturity - fair value $9,315 at September 30, 2015, and $7,641 at December 31, 2014     9,132       7,389     23.6 %
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost     11,073       11,182     -1.0 %
                       
Loans held for sale     3,344       787     324.9 %
                       
Loans receivable     442,859       417,359     6.1 %
Less: Allowance for loan losses     4,082       3,974     2.7 %
  Net loans     438,777       413,385     6.1 %
                       
Premises and equipment, net     10,487       9,475     10.7 %
Bank-owned life insurance     13,089       12,790     2.3 %
Accrued interest receivable     1,640       1,566     4.7 %
Intangible assets, net     76       125     -39.2 %
Goodwill     12,320       12,320     -  
Other assets     2,763       2,761     0.1 %
  Total assets   $ 566,228     $ 545,969     3.7 %
                       
LIABILITIES AND SHAREHOLDERS' EQUITY                      
                       
Deposits   $ 442,046     $ 422,561     4.6 %
Borrowings     63,000       62,000     1.6 %
Other liabilities     6,525       5,915     10.3 %
  Total liabilities     511,571       490,476     4.3 %
                       
Shareholders' equity:                      
Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares authorized; 10,000 shares issued at September 30, 2015 and at December 31, 2014     9,700       9,700     -  
Common stock, $1 par value; authorized 5,000,000 shares; 2,820,745 shares issued at September 30, 2015 and 2,809,364 shares issued at December 31, 2014     2,821       2,809     0.4 %
Additional paid-in capital     41,191       42,365     -2.8 %
Retained earnings     3,303       2,769     19.3 %
Treasury stock, at cost - 98,118 shares at September 30, 2015 and 104,418 shares at December 31, 2014     (2,907 )     (3,053 )   -4.8 %
Accumulated other comprehensive income     496       849     -41.6 %
  Total Elmira Savings Bank shareholders' equity     54,604       55,439     -1.5 %
Noncontrolling interest     53       54     -1.9 %
  Total shareholders' equity     54,657       55,493     -1.5 %
  Total liabilities and shareholders' equity   $ 566,228     $ 545,969     3.7 %
                         
   
   
ELMIRA SAVINGS BANK  
CONSOLIDATED STATEMENT OF INCOME  
(unaudited)  
                             
    Three Months Ended     Nine Months    
    September 30,     Ended September 30,    
(in thousands, except for per share data)   2015   2014   % Change     2015   2014   % Change  
                                     
Interest and dividend income:                                    
  Interest and fees on loans   $ 4,624   $ 4,412   4.8 %   $ 13,656   $ 13,111   4.2 %
  Interest and dividends on securities                                    
    Taxable     331     393   -15.8 %     1,063     1,269   -16.2 %
    Non-taxable     245     221   10.9 %     709     629   12.7 %
    Total interest and dividend income     5,200     5,026   3.5 %     15,428     15,009   2.8 %
                                     
Interest expense:                                    
  Interest on deposits     786     753   4.4 %     2,254     2,240   0.6 %
  Interest on borrowings     562     471   19.3 %     1,668     1,375   21.3 %
    Total interest expense     1,348     1,224   10.1 %     3,922     3,615   8.5 %
Net interest income     3,852     3,802   1.3 %     11,506     11,394   1.0 %
Provision for loan losses     170     138   23.2 %     360     267   34.8 %
Net interest income after provision for loan losses     3,682     3,664   0.5 %     11,146     11,127   0.2 %
                                     
Noninterest income:                                    
  Service fees     376     380   -1.1 %     1,099     1,074   2.3 %
  Gain on sale of loans held for sale     870     483   80.1 %     1,681     1,276   31.7 %
  Gain on sale of securities     -     -   -       284     421   -32.5 %
  Other service fees     174     170   2.4 %     532     510   4.3 %
  Earnings on bank-owned life insurance     98     86   14.0 %     298     308   -3.2 %
  Other     21     36   -41.7 %     115     129   -10.7 %
    Total noninterest income     1,539     1,155   33.2 %     4,009     3,718   7.8 %
                                     
Noninterest expense:                                    
  Salaries and benefits     1,862     2,512   -25.9 %     5,407     6,083   -11.1 %
  Net occupancy     319     317   0.6 %     1,046     1,064   -1.7 %
  Equipment     272     263   3.4 %     780     763   2.2 %
  Marketing and public relations     209     210   -0.5 %     635     614   3.4 %
  Professional fees     225     167   34.7 %     628     523   20.1 %
  Other     838     721   16.2 %     2,320     2,050   13.2 %
    Total noninterest expense     3,725     4,190   -11.1 %     10,816     11,097   -2.5 %
Income before income taxes     1,496     629   137.8 %     4,339     3,748   15.8 %
Income taxes     439     154   185.1 %     1,253     1,114   12.5 %
Net income     1,057     475   122.5 %     3,086     2,634   17.2 %
Less: Net income attributable to noncontrolling interest     -     -   -       -     -   -  
                                     
Net income attibutable to Elmira Savings Bank     1,057     475   122.5 %     3,086     2,634   17.2 %
                                     
Dividend on preferred stock     225     225   -       675     675   -  
Income available to common shareholders   $ 832   $ 250   232.8 %   $ 2,411   $ 1,959   23.1 %
                                     
                                     
Basic earnings per share   $ 0.31   $ 0.09   244.4 %   $ 0.89   $ 0.73   21.9 %
                                     
Diluted earnings per share   $ 0.30   $ 0.09   233.3 %   $ 0.87   $ 0.70   24.3 %
                                     
Weighted average shares outstanding - basic     2,710,219     2,684,475   1.0 %     2,705,958     2,672,010   1.3 %
                                     
Weighted average shares outstanding - diluted     2,730,365     2,802,609   -2.6 %     2,772,737     2,796,982   -0.9 %
                                     
Dividends per share   $ 0.23   $ 0.23   -     $ 0.69   $ 0.69   -  
                                     
   
   
ELMIRA SAVINGS BANK  
AVERAGE BALANCES AND INTEREST RATES  
                             
(Dollars in Thousands)   For the Nine Months Ended  
    September 30, 2015     September 30, 2014  
ASSETS:   Average Balance   Interest   Average Rate     Average Balance   Interest   Average Rate  
Loans   $ 428,567   $ 13,656   4.25 %   $ 393,254   $ 13,111   4.44 %
Short-term investments     1,072     -   0.03       985     1   0.02  
Securities     77,665     1,772   3.04       76,520     1,897   3.31  
Total interest-earning assets     507,304     15,428   4.05       470,759     15,009   4.25  
                                     
Noninterest-earning assets     57,643                 43,903            
                                     
TOTAL ASSETS   $ 564,947               $ 514,662            
                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                                    
Interest-bearing deposits   $ 363,781   $ 2,254   0.83     $ 336,891   $ 2,240   0.89  
Borrowings     73,011     1,668   3.01       57,620     1,375   3.14  
Total interest-bearing liabilities     436,792     3,922   1.19       394,511     3,615   1.22  
                                     
Noninterest-bearing liabilities     72,604                 64,677            
Shareholders' equity     55,551                 55,474            
                                     
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 564,947               $ 514,662            
Interest rate spread               2.86 %               3.03 %
Net interest income/margin         $ 11,506   3.03 %         $ 11,394   3.23 %
                                     
   
   
ELMIRA SAVINGS BANK  
AVERAGE BALANCES AND INTEREST RATES  
                             
(Dollars in Thousands)   For the Three Months Ended  
    September 30, 2015     September 30, 2014  
ASSETS:   Average Balance   Interest   Average Rate     Average Balance   Interest   Average Rate  
Loans   $ 440,467   $ 4,624   4.17 %   $ 400,745   $ 4,412   4.38 %
Short-term investments     675     -   0.03       901     -   0.02  
Securities     76,319     576   3.01       75,821     614   3.24  
Total interest-earning assets     517,461     5,200   4.00       477,467     5,026   4.19  
                                     
Noninterest-earning assets     57,683                 44,325            
                                     
TOTAL ASSETS   $ 575,144               $ 521,792            
                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                                    
Interest-bearing deposits   $ 371,492   $ 786   0.84     $ 339,126   $ 753   0.88  
Borrowings     73,196     562   3.00       58,563     471   3.15  
Total interest-bearing liabilities     444,688     1,348   1.20       397,689     1,224   1.21  
                                     
Noninterest-bearing liabilities     75,287                 68,062            
Shareholders' equity     55,169                 56,041            
                                     
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 575,144               $ 521,792            
Interest rate spread               2.80 %               2.98 %
Net interest income/margin         $ 3,852   2.97 %         $ 3,802   3.18 %
                                     
                                     
       
    Quarter Ended  
(Dollars in Thousands, Except Per Share Data)   9/30/2015     6/30/2015     3/31/2015     12/31/2014     9/30/2014  
Operating Data                                        
  Net income   $ 1,057     $ 1,019     $ 1,010     $ 1,031     $ 475  
  Net interest income     3,852       3,829       3,825       4,018       3,802  
  Provision for loan losses     170       140       50       140       138  
  Net security gains     -       80       204       -       -  
  Non-interest income, ex. Net security gains     1,539       1,155       1,031       1,039       1,155  
  Non-interest expense     3,725       3,522       3,569       3,406       4,190  
Performance Statistics                                        
  Net interest margin     2.97 %     3.04 %     3.07 %     3.24 %     3.18 %
  Annualized return on average assets     0.73 %     0.72 %     0.74 %     0.76 %     0.36 %
  Annualized return on average equity     7.60 %     7.39 %     7.29 %     7.37 %     3.36 %
  Annualized net loan charge-offs to avg loans     0.10 %     0.11 %     0.02 %     0.09 %     -0.01 %
  Net charge-offs (recoveries)     117       114       21       94       (7 )
  Efficiency ratio     69.1 %     69.5 %     70.5 %     67.4 %     84.5 %
Per Share Data                                        
  Basic earnings per share   $ 0.31     $ 0.29     $ 0.29     $ 0.30     $ 0.09  
  Diluted earnings per share     0.30       0.29       0.28       0.29       0.09  
  Dividend declared per share     0.23       0.23       0.23       0.23       0.23  
  Book value     16.49       16.34       16.96       16.91       16.76  
  Common stock price:                                        
    High     20.81       20.82       23.00       23.00       24.54  
    Low     19.05       19.43       19.99       20.50       20.16  
    Close     19.20       20.09       20.40       23.00       22.25  
  Weighted average common shares:                                        
    Basic     2,710       2,707       2,701       2,693       2,684  
    Fully diluted     2,730       2,776       2,812       2,808       2,803  
  End-of-period common shares:                                        
    Issued     2,821       2,821       2,813       2,809       2,809  
    Treasury     98       98       98       104       104  
                                         
                                         
Financial Condition Data:                                        
General                                        
  Total assets   $ 566,228     $ 572,890     $ 562,185     $ 545,969     $ 533,726  
  Loans, net     438,777       431,993       416,235       413,385       406,168  
  Intangibles     12,396       12,412       12,428       12,445       12,464  
  Total deposits     442,046       437,663       426,075       422,561       405,681  
    Noninterest-bearing     72,293       68,707       64,442       62,019       68,871  
    Savings     64,421       64,758       63,776       65,287       62,898  
    NOW     85,136       86,835       78,169       78,920       75,246  
    Money Market     19,912       20,678       22,112       20,512       21,498  
    Time deposits     200,284       196,685       197,576       195,823       177,168  
    Total interest-bearing deposits     369,753       368,956       361,633       360,542       336,810  
  Shareholders' equity     54,657       54,233       55,818       55,493       55,088  
Asset Quality                                        
  Non-performing assets   $ 4,545     $ 4,430     $ 4,790     $ 4,699     $ 4,575  
  Non-performing assets to total assets     0.80 %     0.77 %     0.85 %     0.86 %     0.86 %
  Allowance for loan losses     4,082       4,028       4,002       3,974       3,928  
  Allowance for loan losses to total loans     0.92 %     0.92 %     0.95 %     0.95 %     0.96 %
  Allowance for loan losses to non-performing loans     91.20 %     91.75 %     83.55 %     84.57 %     88.61 %
  Non-performing loans to total loans     1.01 %     1.01 %     1.14 %     1.13 %     1.08 %
Capitalization                                        
  Shareholders' equity to total assets     9.65 %     9.47 %     9.93 %     10.16 %     10.32 %

Contact Information

  • For further information contact:
    Thomas M. Carr
    President & CEO
    Elmira Savings Bank
    333 East Water Street
    Elmira, New York 14901
    (607) 735-8660
    Email Contact