SOURCE: Elmira Savings Bank

Elmira Savings Bank

July 16, 2014 10:10 ET

Elmira Savings Bank Reports Second Quarter Earnings

ELMIRA, NY--(Marketwired - Jul 16, 2014) - Elmira Savings Bank (NASDAQ: ESBK)

Highlights

  • Net income was $1,099,000 and $2,159,000 for the three and six months ended June 30, 2014 compared to $1,374,000 and $2,566,000 for the same periods in 2013.

  • Diluted earnings per share were $.31 per share and $.61 per share for the three and six months ended June 30, 2014 compared to $.40 per share and $.69 per share for the same periods in 2013. 

  • Return on average assets was .86% and .85% for the three and six months ended June 30, 2014 compared to 1.07% and .99% for the same periods in 2013.

  • Return on average equity was 7.95% and 7.89% for the three and six months ended June 30, 2014 compared to 9.67% and 8.38% for the same periods in 2013.

"During the first six months of 2014, the Bank experienced a decline in its mortgage originations, despite maintaining its market share, due to lower levels of refinancing, as well as purchasing activity across our market area. This decline in originations has unfavorably affected our level of noninterest income," said Thomas M. Carr, President and COO.

Mr. Carr continued, "We have maintained our net interest margin, limited our operating expenses, increased deposit fee income, and continue to have strong asset quality."

Net Income

Net income totaled $2,159,000 for the six months ended June 30, 2014, a decrease of $407,000 or 16% from the $2,566,000 of net income recorded for the same period in 2013. This decrease was the net result of a decrease in noninterest income of $341,000, an increase in tax expense of $237,000, and an increase in noninterest expense of $46,000, offset by an increase in net interest income of $81,000 and a decrease in the provision for loan losses of $136,000.

Net income totaled $1,099,000 for the three months ended June 30, 2014, a decrease of $275,000 or 20% from the $1,374,000 recorded for the same period in 2013. This decrease was the net result of a decrease in noninterest income of $145,000 and an increase in tax expense of $288,000, offset by a decrease in noninterest expense of $141,000, an increase in net interest income of $7,000 and a decrease in the provision for loan losses of $10,000.

Net income of $1.1 million for the current quarter ended June 30, 2014 represents an increase of $39,000, or 4%, from net income for the preceding quarter ended March 31, 2014.

Basic and diluted earnings per share for the six months ended June 30, 2014 were $.64 per share and $.61 per share compared to $.73 per share and $.69 per share for the same period in 2013. Basic and diluted earnings per share for the three months ended June 30, 2014 were $.33 per share and $.31 per share compared to $.42 per share and $.40 per share for the same period in 2013.

Net Interest Margin

The net interest margin for the six months ended June 30, 2014 was 3.25% compared to 3.28% for the same period in 2013. The yield on average earning assets was 4.28% for the six months ended June 30, 2014 compared to 4.41% for the same period in 2013. The average cost of interest-bearing liabilities was 1.22% for the six months ended June 30, 2014 compared to 1.32% for the same period in 2013.

The net interest margin for the three months ended June 30, 2014 was 3.19% compared to 3.24% for the same period in 2013. The average yield on earning assets was 4.22% for the three months ended June 30, 2014 compared to 4.36% for the same period in 2013. The average cost of interest-bearing liabilities was 1.22% for the three months ended June 30, 2014 compared to 1.32% for the same period in 2013.

Assets

Total assets increased $2.7 million or 0.5% to $517.1 million at June 30, 2014 compared to $514.3 million at December 31, 2013. Loans receivable increased 1.6% to $395.4 million at June 30, 2014 compared to December 31, 2013. The available-for-sale investment portfolio decreased $8.7 million from December 31, 2013 to June 30, 2014.

Nonperforming Loans

Our nonperforming loans to total loans ratio has increased to 1.06% at June 30, 2014 from .90% at December 31, 2013. Net loan charge-offs to average loans for the six months ended June 30, 2014 of 0.09% decreased from 0.10% for the six months ended June 30, 2013. The allowance for loan losses was 0.96% of total loans at June 30, 2014 and 0.99% of total loans at December 31, 2013.

Liabilities

Deposits total $399.2 million at June 30, 2014, an increase of $1.5 million or 0.4%. The $1.5 million increase consists of a $2.5 million increase in savings accounts, a $1.6 million increase in money market accounts, a $1.3 million increase in noninterest-bearing accounts, and a $0.7 million increase in time deposits, partially offset by a $4.6 million decrease in NOW accounts. Borrowed funds decreased by $1.5 million or 3%.

Shareholders' Equity

Shareholders' equity increased $1.2 million to $55.2 million at June 30, 2014 compared to December 31, 2013. The current level of shareholders' equity equates to a book value per share of $16.87 at June 30, 2014, compared to $16.64 at December 31, 2013. Dividends paid to common shareholders were $0.23 and $0.46 for the three and six months ended June 30, 2014 compared to $0.21 and $0.42 for the same periods in 2013, representing increases of 9.5% for both the three and six month periods. 

Elmira Savings Bank, with $517.1 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)   June 30,     December 31,        
    2014     2013     % Change  
ASSETS                      
                       
Cash and due from banks   $ 12,048     $ 7,077     70.2 %
Federal funds sold and other short-term investments     477       564     -15.4 %
  Total cash and cash equivalents     12,525       7,641     63.9 %
                       
Securities available for sale, at fair value     54,813       63,464     -13.6 %
Securities held to maturity - fair value $8,023 at June 30, 2014, and $8,302 at December 31, 2013     7,588       7,805     -2.8 %
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost     10,450       10,417     0.3 %
                       
Loans held for sale     1,579       1,847     -14.5 %
                       
Loans receivable     395,394       389,129     1.6 %
Less: Allowance for loan losses     3,783       3,834     -1.3 %
  Net loans     391,611       385,295     1.6 %
                       
Premises and equipment, net     9,128       8,620     5.9 %
Bank-owned life insurance     12,609       12,387     1.8 %
Accrued interest receivable     1,454       1,454     0.0 %
Intangible assets, net     166       210     -21.0 %
Goodwill     12,320       12,320     0.0 %
Other assets     2,810       2,865     -1.9 %
  Total assets   $ 517,053     $ 514,325     0.5 %
                       
LIABILITIES AND SHAREHOLDERS' EQUITY                      
                       
Deposits   $ 399,219     $ 397,733     0.4 %
Borrowings     55,000       56,500     -2.7 %
Other liabilities     7,632       6,067     25.8 %
  Total liabilities     461,851       460,300     0.3 %
                       
Shareholders' equity:                      
Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares authorized; 10,000 shares issued at June 30, 2014 and at December 31, 2013     9,700       9,700     0.0 %
Common stock, $1 par value; authorized 5,000,000 shares; 2,798,757 shares issued at June 30, 2014 and 2,776,240 shares issued at December 31, 2013     2,799       2,776     0.8 %
Additional paid-in capital     41,999       41,693     0.7 %
Retained earnings     2,958       2,485     19.0 %
Treasury stock, at cost - 104,418 shares at June 30, 2014 and 116,268 shares at December 31, 2013     (3,053 )     (3,327 )   -8.2 %
Accumulated other comprehensive income     745       644     15.7 %
  Total Elmira Savings Bank shareholders' equity     55,148       53,971     2.2 %
Noncontrolling interest     54       54     0.0 %
  Total shareholders' equity     55,202       54,025     2.2 %
  Total liabilities and shareholders' equity   $ 517,053     $ 514,325     0.5 %
                       
                       
                       
ELMIRA SAVINGS BANK  
CONSOLIDATED STATEMENT OF INCOME  
(unaudited)  
                           
  Three Months Ended     Six Months Ended      
  June 30,     June 30,      
(in thousands, except for per share data) 2014   2013   % Change     2014   2013   % Change  
                                   
Interest and dividend income:                                  
  Interest and fees on loans $ 4,302   $ 4,390   -2.0 %   $ 8,699   $ 8,863   -1.9 %
  Interest and dividends on securities                                  
    Taxable   412     424   -2.8 %     876     871   0.6 %
    Non-taxable   204     191   6.8 %     408     376   8.5 %
    Total interest and dividend income   4,918     5,005   -1.7 %     9,983     10,110   -1.3 %
                                   
Interest expense:                                  
  Interest on deposits   745     809   -7.9 %     1,487     1,638   -9.2 %
  Interest on borrowings   454     484   -6.2 %     904     961   -5.9 %
    Total interest expense   1,199     1,293   -7.3 %     2,391     2,599   -8.0 %
Net interest income   3,719     3,712   0.2 %     7,592     7,511   1.1 %
Provision for loan losses   75     85   -11.8 %     129     265   -51.3 %
Net interest income after provision for loan losses   3,644     3,627   0.5 %     7,463     7,246   3.0 %
                                   
Noninterest income:                                  
  Service fees   365     329   10.9 %     694     645   7.6 %
  Gain on sale of loans held for sale   345     806   -57.2 %     793     1,654   -52.1 %
  Gain on sale of securities   205     -   -       421     61   590.2 %
  Other service fees   176     172   2.3 %     340     326   4.3 %
  Earnings on bank-owned life insurance   131     91   44.0 %     222     181   22.7 %
  Other   52     21   147.6 %     93     37   151.4 %
    Total noninterest income   1,274     1,419   -10.2 %     2,563     2,904   -11.7 %
                                   
Noninterest expense:                                  
  Salaries and benefits   1,732     1,786   -3.0 %     3,571     3,607   -1.0 %
  Net occupancy   331     318   4.1 %     747     643   16.2 %
  Equipment   250     253   -1.2 %     500     512   -2.3 %
  Marketing and public relations   204     204   0.0 %     404     351   15.1 %
  Professional fees   195     207   -5.8 %     356     376   -5.3 %
  Other   632     717   -11.9 %     1,329     1,372   -3.1 %
    Total noninterest expense   3,344     3,485   -4.0 %     6,907     6,861   0.7 %
Income before income taxes   1,574     1,561   0.8 %     3,119     3,289   -5.2 %
Income taxes   475     187   154.0 %     960     723   32.8 %
Net income   1,099     1,374   -20.0 %     2,159     2,566   -15.9 %
Less: Net income attributable to noncontrolling interest   -     -   -       -     -   -  
                                   
Net income attibutable to Elmira Savings Bank   1,099     1,374   -20.0 %     2,159     2,566   -15.9 %
                                   
Dividend on preferred stock   225     269   -16.4 %     450     670   -32.8 %
Income available to common shareholders $ 874   $ 1,105   -20.9 %   $ 1,709   $ 1,896   -9.9 %
                                   
                                   
Basic earnings per share $ 0.33   $ 0.42   -21.4 %   $ 0.64   $ 0.73   -12.3 %
                                   
Diluted earnings per share $ 0.31   $ 0.40   -22.5 %   $ 0.61   $ 0.69   -11.6 %
                                   
Weighted average shares outstanding - basic   2,674,032     2,619,970   2.1 %     2,665,640     2,597,348   2.6 %
                                   
Weighted average shares outstanding - diluted   2,798,114     2,741,351   2.1 %     2,794,030     2,733,275   2.2 %
                                   
Dividends per share $ 0.23   $ 0.21   9.5 %   $ 0.46   $ 0.42   9.5 %
                                   
                                   
Per share data has been restated to reflect the 10% stock dividend paid on December 27, 2013.  
   
   
   
ELMIRA SAVINGS BANK  
AVERAGE BALANCES AND INTEREST RATES  
                             
(Dollars in Thousands)   For the Six Months Ended  
    June 30, 2014     June 30, 2013  
ASSETS:   Average Balance   Interest   Average Rate     Average Balance   Interest   Average Rate  
Loans   $ 389,447   $ 8,699   4.48 %   $ 377,787   $ 8,863   4.70 %
Short-term investments     1,028     -   0.02       2,235     -   0.03  
Securities     76,875     1,284   3.34       79,534     1,247   3.14  
Total interest-earning assets     467,350     9,983   4.28       459,556     10,110   4.41  
                                     
Noninterest-earning assets     43,688                 61,847            
                                     
TOTAL ASSETS   $ 511,038               $ 521,403            
                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                                    
Interest-bearing deposits   $ 335,755   $ 1,487   0.89     $ 339,943   $ 1,638   0.98  
Borrowings     57,141     904   3.14       54,299     961   3.52  
Total interest-bearing liabilities     392,896     2,391   1.22       394,242     2,599   1.32  
                                     
Noninterest-bearing liabilities     62,957                 65,378            
Shareholders' equity     55,185                 61,783            
                                     
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 511,038               $ 521,403            
Interest rate spread               3.06 %               3.09 %
Net interest income/margin         $ 7,592   3.25 %         $ 7,511   3.28 %
                                     
                                     
                                     
ELMIRA SAVINGS BANK  
AVERAGE BALANCES AND INTEREST RATES  
                           
(Dollars in Thousands) For the Three Months Ended  
  June 30, 2014     June 30, 2013  
ASSETS: Average Balance   Interest   Average Rate     Average Balance   Interest   Average Rate  
Loans $ 390,122   $ 4,302   4.41 %   $ 378,654   $ 4,390   4.64 %
Short-term investments   1,000     -   0.02       1,879     -   0.03  
Securities   74,772     616   3.30       78,488     615   3.13  
Total interest-earning assets   465,894     4,918   4.22       459,021     5,005   4.36  
                                   
Noninterest-earning assets   44,874                 53,762            
                                   
TOTAL ASSETS $ 510,768               $ 512,783            
                                   
LIABILITIES AND SHAREHOLDERS' EQUITY                                  
Interest-bearing deposits $ 336,018   $ 745   0.89     $ 336,175   $ 809   0.97  
Borrowings   55,882     454   3.22       54,595     484   3.51  
Total interest-bearing liabilities   391,900     1,199   1.22       390,770     1,293   1.32  
                                   
Noninterest-bearing liabilities   63,452                 65,013            
Shareholders' equity   55,416                 57,000            
                                   
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 510,768               $ 512,783            
Interest rate spread             3.00 %               3.04 %
Net interest income/margin       $ 3,719   3.19 %         $ 3,712   3.24 %
                                   
                                   
                                   
  Quarter Ended  
     
(Dollars in Thousands, Except Per Share Data) 6/30/2014     3/31/2014     12/31/2013     9/30/2013     6/30/2013  
                             
Operating Data                                      
                                       
  Net income $ 1,099     $ 1,060     $ 1,119     $ 1,369     $ 1,374  
  Net interest income   3,719       3,873       3,772       3,770       3,712  
  Provision for loan losses   75       54       -       50       85  
  Net security gains   205       216       -       -       -  
  Non-interest income, ex. Net security gains   1,069       1,073       1,179       1,474       1,419  
  Non-interest expense   3,344       3,563       3,573       3,428       3,485  
                                       
Performance Statistics                                      
                                       
  Net interest margin   3.19 %     3.31 %     3.22 %     3.23 %     3.24 %
  Annualized return on average assets   0.86 %     0.84 %     0.85 %     1.05 %     1.07 %
  Annualized return on average equity   7.95 %     7.82 %     7.75 %     9.55 %     9.67 %
  Annualized net loan charge-offs to avg loans   0.15 %     0.04 %     -0.02 %     0.04 %     0.00 %
  Net charge-offs (recoveries)   143       38       (15 )     40       -  
  Efficiency ratio   67.0 %     69.0 %     72.2 %     65.4 %     67.9 %
                                       
Per Share Data                                      
                                       
  Basic earnings per share $ 0.33     $ 0.31     $ 0.32     $ 0.42     $ 0.42  
  Diluted earnings per share   0.31       0.30       0.30       0.40       0.40  
  Dividend declared per share   0.23       0.23       0.21       0.21       0.21  
  Book value   16.87       16.78       16.64       16.62       16.44  
  Common stock price:                                      
    High   24.78       26.97       28.45       22.73       23.93  
    Low   21.92       22.25       20.15       19.30       18.18  
    Close   24.50       24.49       25.20       22.07       19.59  
  Weighted average common shares:                                      
    Basic   2,674       2,657       2,639       2,626       2,620  
    Fully diluted   2,798       2,790       2,764       2,745       2,741  
  End-of-period common shares:                                      
    Issued   2,799       2,787       2,776       2,775       2,771  
    Treasury   104       104       116       116       116  
                                       
Share and per share data has been restated to reflect the 10% stock dividend paid on December 27, 2013.  
                                       
Financial Condition Data:                                      
General                                      
  Total assets $ 515,053     $ 513,938     $ 514,325     $ 519,747     $ 516,137  
  Loans, net   391,611       388,295       385,295       381,298       380,252  
  Intangibles   12,486       12,508       12,530       12,555       12,582  
  Total deposits   399,219       394,951       397,733       396,600       396,993  
                                         
    Noninterest-bearing   61,221       57,059       59,886       62,616       61,018  
                                           
    Savings   63,433       61,655       60,924       60,710       61,918  
    NOW   73,116       75,789       77,736       72,076       71,894  
    Money Market   22,702       21,540       21,130       22,465       20,826  
    Time deposits   178,747       178,908       178,057       178,733       181,337  
    Total interest-bearing deposits   337,998       337,892       337,847       333,984       335,975  
                                         
  Shareholders' equity   55,202       54,763       54,025       57,290       56,745  
                                       
Asset Quality                                      
                                       
  Non-performing assets $ 4,281     $ 3,368     $ 3,592     $ 3,302     $ 3,575  
  Non-performing assets to total assets   0.83 %     0.66 %     0.70 %     0.64 %     0.69 %
  Allowance for loan losses   3,783       3,851       3,834       3,819       3,809  
  Allowance for loan losses to total loans   0.96 %     0.98 %     0.99 %     0.99 %     0.99 %
  Allowance for loan losses to non-performing loans   89.90 %     119.23 %     109.73 %     115.66 %     106.55 %
  Non-performing loans to total loans   1.06 %     0.82 %     0.90 %     0.86 %     0.93 %
                                       
Capitalization                                      
                                       
  Shareholders' equity to total assets   10.72 %     10.66 %     10.50 %     11.02 %     10.99 %

Contact Information

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