Elmira Savings Bank Reports Second Quarter Earnings

Marketwired

ELMIRA, NY--(Marketwired - Jul 17, 2013) -  Elmira Savings Bank (NASDAQ: ESBK)

Highlights

  • Net income increased to $1,374,000 and $2,566,000 for the three and six months ended June 30, 2013 compared to $1,358,000 and $2,516,000 for the same periods in 2012.

  • Diluted earnings per share were $.44 per share and $.76 per share for the three and six months ended June 30, 2013 compared to $.40 per share and $.73 per share for the same periods in 2012. These represent increases of 10.0% and 4.1% for the three and six months ended June 30, 2013 compared to the same periods in 2012.

  • Return on average assets was 1.07% and .99% for the three and six months ended June 30, 2013 compared to 1.04% and .97% for the same periods in 2012.

  • Return on average equity was 9.67% and 8.38% for the three and six months ended June 30, 2013 compared to 8.33% and 7.73% for the same periods in 2012.

"We are pleased to report strong operating results for the first half of 2013. Our redemption of $10.5 million of preferred stock at the end of first quarter of 2013, combined with increased earnings has resulted in an increase of earnings per share by 10% for the second quarter of 2013 compared to the same period in 2012," said Thomas M. Carr, President and COO. 

Net Income

Net income totaled $2,566,000 for the six months ended June 30, 2013, an increase of $50,000 or 2% from the $2,516,000 of net income recorded for the same period in 2012. This increase of $50,000 was the net result of an increase in noninterest income of $106,000 and a reduction in tax expense of $460,000, offset by a decline in net interest income of $29,000, and an increase in noninterest expense of $489,000.

Net income totaled $1,374,000 for the three months ended June 30, 2013, an increase of $16,000 or 1% from the $1,358,000 recorded for the same period in 2012. This increase was the net result of a reduction in tax expense of $476,000, offset by a decline in noninterest income and net interest income of $129,000 and $60,000, a reduction in the provision for loan losses of $57,000, and an increase of $328,000 in noninterest expense.

Basic and diluted earnings per share for the six months ended June 30, 2013 were $.80 per share and $.76 per share compared to $.76 per share and $.73 per share for the same period in 2012. Basic and diluted earnings per share for the three months ended June 30, 2013 were $.46 per share and $.44 per share compared to $.42 per share and $.40 per share for the same period in 2012.

Net Interest Margin

The net interest margin for the six months ended June 30, 2013 was 3.28% compared to 3.39% for the same period in 2012. The yield on average earning assets was 4.41% for the six months ended June 30, 2013 compared to 4.77% for the same period in 2012. The average cost of interest-bearing liabilities was 1.32% for the six months ended June 30, 2013 compared to 1.54% for the same period in 2012.

The net interest margin for the three months ended June 30, 2013 was 3.24% compared to 3.37% for the same period in 2012. The average yield on earning assets was 4.36% for the three months ended June 30, 2013 compared to 4.71% for the same period in 2012. The average cost of interest-bearing liabilities was 1.32% for the three months ended June 30, 2013 compared to 1.50% for the same period in 2012.

Assets

Total assets decreased $20.8 million or 4% to $516.1 million at June 30, 2013 compared to $536.9 million at December 31, 2012. Loans receivable increased 2% to $384.1 million at June 30, 2013 compared to December 31, 2012. The available-for-sale investment portfolio decreased $7.2 million from December 31, 2012 to June 30, 2013.

"During the first half of 2013, our loan production remained strong and has allowed us to grow our loan portfolio and avoid participating in the historically low yield investment market," said Thomas M. Carr, President and COO. 

Nonperforming Loans

Our nonperforming loans to total loans ratio has decreased to .93% at June 30, 2013 from 1.02% at December 31, 2012. Net loan charge-offs to average loans for the six months ended June 30, 2013 of 0.10% increased from 0.01% for the six months ended June 30, 2012. The allowance for loan losses was 0.99% of total loans at June 30, 2013 and December 31, 2012.

Liabilities

Deposits total $397.0 million at June 30, 2013, a decrease of $12.6 million or 3%. The $12.6 million decrease primarily consists of an $11.5 million decrease in time deposits and a $4.2 million decrease in NOW accounts, partially offset by a $2.8 million increase in savings accounts. Borrowed funds increased by $2.0 million or 4%.

Shareholders' Equity

Shareholders' equity decreased $10.2 million to $56.7 million at June 30, 2013 compared to December 31, 2012. The decrease in shareholders' equity is attributable to the Bank redeeming $10.5 million of preferred stock issued to the United States Treasury Department through the Small Business Lending Fund. The current level of shareholders' equity equates to a book value per share of $18.10 at June 30, 2013, compared to $18.50 at December 31, 2012. Dividends paid to common shareholders were $0.23 and $0.46 for the three and six months ended June 30, 2013 compared to $0.21 and $0.42 for the same periods in 2012, representing increases of 9.5% for both the three and six month periods. 

Elmira Savings Bank, with $516.1 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; and a loan center in Cortland 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,        
    2013     2012     % Change  
ASSETS                      
                       
Cash and due from banks   $ 17,658     $ 39,641     -55.5 %
Federal funds sold and other short-term investments     742       684     8.5 %
  Total cash and cash equivalents     18,400       40,325     -54.4 %
                       
Securities available for sale, at fair value     59,653       66,875     -10.8 %
Securities held to maturity - fair value $6,802 at June 30, 2013, and $5,853 at December 31, 2012     6,633       5,521     20.1 %
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost     9,942       9,178     8.3 %
                       
Loans held for sale     4,484       3,167     41.6 %
                       
Loans receivable     384,061       378,108     1.6 %
Less: Allowance for loan losses     3,809       3,740     1.8 %
  Net loans     380,252       374,368     1.6 %
                       
Premises and equipment, net     7,982       7,947     0.4 %
Bank-owned life insurance     12,169       11,988     1.5 %
Accrued interest receivable     1,498       1,529     -2.0 %
Intangible assets, net     262       316     -17.1 %
Goodwill     12,320       12,320     0.0 %
Other real estate owned     -       125     -100.0 %
Other assets     2,542       3,277     -22.4 %
  Total assets   $ 516,137     $ 536,936     -3.9 %
                       
LIABILITIES AND SHAREHOLDERS' EQUITY                      
                       
Deposits   $ 396,993     $ 409,565     -3.1 %
Borrowings     56,000       54,000     3.7 %
Other liabilities     6,399       6,462     -1.0 %
  Total liabilities     459,392       470,027     -2.3 %
                       
Shareholders' equity:                      
Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares authorized; 13,515 shares issued at June 30, 2013 and at 24,063 shares issued at December 31, 2012     13,215       23,763     -44.4 %
Common stock, $1 par value; authorized 5,000,000 shares; 2,518,813 shares issued at June 30, 2013 and 2,454,840 shares issued at December 31, 2012     2,519       2,455     2.6 %
Additional paid-in capital     41,586       41,448     0.3 %
Retained earnings     1,661       868     91.4 %
Treasury stock, at cost - 116,268 shares at June 30, 2013 and 125,865 shares at December 31, 2012     (3,327 )     (3,548 )   -6.2 %
Accumulated other comprehensive income     1,035       1,872     -44.7 %
  Total Elmira Savings Bank shareholders' equity     56,689       66,858     -15.2 %
Noncontrolling interest     56       51     9.8 %
  Total shareholders' equity     56,745       66,909     -15.2 %
  Total liabilities and shareholders' equity   $ 516,137     $ 536,936     -3.9 %
                       
                       
                       
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)   2013   2012   % Change     2013   2012   % Change  
                                     
Interest and Dividend Income:                                    
  Interest and fees on loans   $ 4,390   $ 4,520   -2.9 %   $ 8,863   $ 9,094   -2.5 %
  Interest and dividends on securities                                    
      Taxable     424     553   -23.3 %     871     1,128   -22.8 %
      Non-taxable     191     197   -3.0 %     376     397   -5.3 %
    Total interest and dividend income     5,005     5,270   -5.0 %     10,110     10,619   -4.8 %
                                     
Interest Expense:                                    
  Interest on deposits     809     924   -12.4 %     1,638     1,871   -12.5 %
  Interest expense on borrowings     484     574   -15.7 %     961     1,208   -20.4 %
    Total interest expense     1,293     1,498   -13.7 %     2,599     3,079   -15.6 %
Net interest income     3,712     3,772   -1.6 %     7,511     7,540   -0.4 %
Provision for loan losses     85     142   -40.1 %     265     267   -0.7 %
Net interest income after provision for loan losses     3,627     3,630   -0.1 %     7,246     7,273   -0.4 %
                                     
Noninterest Income:                                    
  Service fees     329     316   4.1 %     645     638   1.1 %
  Net gain on sale of loans     806     880   -8.4 %     1,654     1,536   7.7 %
  Net gain on sale of securities     -     75   -100.0 %     61     75   -18.7 %
  Other service fees     172     153   12.4 %     326     317   2.8 %
  Earnings on bank-owned life insurance     91     86   5.8 %     181     168   7.7 %
  Other     21     38   -44.7 %     37     64   -42.2 %
    Total noninterest income     1,419     1,548   -8.3 %     2,904     2,798   3.8 %
                                     
Noninterest Expense:                                    
  Salaries and benefits     1,786     1,672   6.8 %     3,607     3,324   8.5 %
  Net occupancy     318     284   12.0 %     643     586   9.7 %
  Equipment     253     229   10.5 %     512     446   14.8 %
  Regulatory assessments     116     100   16.0 %     221     200   10.5 %
  Marketing and public relations     204     150   36.0 %     351     296   18.6 %
  Professional fees     207     168   23.2 %     376     352   6.8 %
  Other     601     554   8.5 %     1,151     1,168   -1.5 %
    Total noninterest expense     3,485     3,157   10.4 %     6,861     6,372   7.7 %
Income before income taxes     1,561     2,021   -22.8 %     3,289     3,699   -11.1 %
Income taxes     187     663   -71.8 %     723     1,183   -38.9 %
Net income     1,374     1,358   1.2 %     2,566     2,516   2.0 %
Less: Net income attributable to noncontrolling interest     -     -   -       -     -      
                                     
Net income attibutable to Elmira Savings Bank     1,374     1,358   1.2 %     2,566     2,516   2.0 %
                                     
Dividend on preferred stock     269     403   -33.3 %     670     798   -16.0 %
Income available to common shareholders   $ 1,105   $ 955   15.7 %   $ 1,896   $ 1,718   10.4 %
                                     
                                     
Basic earnings per share   $ 0.46   $ 0.42   9.5 %   $ 0.80   $ 0.76   5.3 %
                                     
Diluted earnings per share   $ 0.44   $ 0.40   10.0 %   $ 0.76   $ 0.73   4.1 %
                                     
Weighted average shares outstanding - basic     2,381,791     2,268,804   5.0 %     2,361,225     2,264,365   4.3 %
                                     
Weighted average shares outstanding - diluted     2,492,137     2,382,599   4.6 %     2,484,795     2,366,520   5.0 %
                                     
Dividends per share   $ 0.23   $ 0.21   9.5 %   $ 0.46   $ 0.42   9.5 %
                                     
Per share data has been restated to reflect the 5% stock dividend paid on December 28, 2012.  
   
   
   
ELMIRA SAVINGS BANK  
AVERAGE BALANCES AND INTEREST RATES  
                             
(Dollars in Thousands)   For the Three Months Ended  
    June 30, 2013     June 30, 2012  
ASSETS:   Average Balance   Interest   Average Rate     Average Balance   Interest   Average Rate  
Loans   $ 378,654   $ 4,390   4.64 %   $ 356,304   $ 4,520   5.08 %
Short-term investments     1,879     -   0.03       1,299     -   0.04  
Securities     78,488     615   3.13       90,588     750   3.31  
Total interest-earning assets     459,021     5,005   4.36       448,191     5,270   4.71  
                                     
Noninterest-earning assets     53,762                 74,338            
                                     
TOTAL ASSETS   $ 512,783               $ 522,529            
                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                                    
Interest-bearing deposits   $ 336,175   $ 809   0.97     $ 337,902   $ 924   1.10  
Borrowings     54,595     484   3.51       61,813     574   3.67  
Total interest-bearing liabilities     390,770     1,293   1.32       399,715     1,498   1.50  
                                     
Noninterest-bearing liabilities     65,013                 57,442            
Shareholders' equity     57,000                 65,372            
                                     
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 512,783               $ 522,529            
Interest rate spread               3.04 %               3.21 %
Net interest income/margin         $ 3,712   3.24 %         $ 3,772   3.37 %
                                     
                                     
                                     
ELMIRA SAVINGS BANK  
AVERAGE BALANCES AND INTEREST RATES  
                             
(Dollars in Thousands)   For the Six Months Ended  
    June 30, 2013     June 30, 2012  
ASSETS:   Average Balance   Interest   Average Rate     Average Balance   Interest   Average Rate  
Loans   $ 377,787   $ 8,863   4.70 %   $ 352,100   $ 9,094   5.17 %
Short-term investments     2,235     -   0.03       1,098     -   0.03  
Securities     79,534     1,247   3.14       92,491     1,525   3.29  
Total interest-earning assets     459,556     10,110   4.41       445,689     10,619   4.77  
                                     
Noninterest-earning assets     61,847                 75,042            
                                     
TOTAL ASSETS   $ 521,403               $ 520,731            
                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                                    
Interest-bearing deposits   $ 339,943   $ 1,638   0.98     $ 333,394   $ 1,871   1.12  
Borrowings     54,299     961   3.52       65,199     1,208   3.67  
Total interest-bearing liabilities     394,242     2,599   1.32       398,593     3,079   1.54  
                                     
Noninterest-bearing liabilities     65,378                 56,852            
Shareholders' equity     61,783                 65,286            
                                     
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 521,403               $ 520,731            
Interest rate spread               3.09 %               3.23 %
Net interest income/margin         $ 7,511   3.28 %         $ 7,540   3.39 %
                                     
                                     
                                     
          Quarter Ended  
(Dollars in Thousands, Except Per Share Data)   6/30/2013     3/31/2013     12/31/2012     9/30/2012     6/30/2012  
                               
Operating Data                                        
                                         
  Net income   $ 1,374     $ 1,192     $ 1,299     $ 1,398     $ 1,358  
  Net interest income     3,712       3,799       3,739       3,810       3,772  
  Provision for loan losses     85       180       42       154       142  
  Net security gains     -       61       -       -       75  
  Non-interest income, ex. Net security gains     1,419       1,424       1,529       1,723       1,473  
  Non-interest expense     3,485       3,376       3,301       3,271       3,157  
                                           
Performance Statistics                                        
                                         
  Net interest margin     3.24 %     3.32 %     3.25 %     3.32 %     3.37 %
  Annualized return on average assets     1.07 %     0.91 %     0.97 %     1.04 %     1.04 %
  Annualized return on average equity     9.67 %     7.26 %     7.72 %     8.39 %     8.33 %
  Annualized net loan charge-offs to avg loans     0.00 %     0.21 %     0.03 %     -0.02 %     0.02 %
  Net charge-offs (recoveries)     -       196       31       (19 )     20  
  Efficiency ratio     67.9 %     63.9 %     62.7 %     59.1 %     59.3 %
                                           
Per Share Data                                        
                                         
  Basic earnings per share   $ 0.46     $ 0.34     $ 0.39     $ 0.44     $ 0.42  
  Diluted earnings per share     0.44       0.32       0.37       0.42       0.40  
  Dividend declared per share     0.23       0.23       0.22       0.22       0.21  
  Book value     18.10       18.13       18.50       18.52       18.22  
  Common stock price:                                        
    High     26.32       25.35       23.65       19.04       20.46  
    Low     20.00       22.74       18.48       17.50       16.83  
    Close     21.55       25.35       22.74       18.86       18.36  
  Weighted average common shares:                                        
    Basic     2,382       2,335       2,297       2,280       2,269  
    Fully diluted     2,492       2,471       2,424       2,396       2,383  
  End-of-period common shares:                                        
    Issued     2,519       2,510       2,455       2,438       2,425  
    Treasury     116       116       126       126       126  
                                         
Share and per share data has been restated to reflect the 5% stock dividend paid on December 28, 2012.          
                                         
Financial Condition Data:                                        
General                                        
  Total assets   $ 516,137     $ 510,915     $ 536,936     $ 534,159     $ 530,646  
  Loans, net     380,252       370,753       374,368       369,851       358,756  
  Intangibles     12,582       12,609       12,636       12,667       12,699  
  Total deposits     396,993       395,091       409,565       406,216       397,972  
                                           
    Noninterest-bearing     61,018       58,118       61,444       58,760       55,269  
                                             
    Savings     61,918       60,177       59,034       56,115       56,332  
    NOW     71,894       71,472       76,133       73,079       73,431  
    Money Market     20,826       19,222       20,131       23,082       19,272  
    Time deposits     181,337       186,102       192,823       195,180       193,668  
    Total interest-bearing deposits     335,975       336,973       348,121       347,456       342,703  
                                             
  Shareholders' equity     56,745       56,677       66,609       66,543       65,621  
                                           
Asset Quality                                        
                                         
  Non-performing assets   $ 3,575     $ 3,826     $ 3,986     $ 3,980     $ 3,829  
  Non-performing assets to total assets     0.69 %     0.75 %     0.74 %     0.75 %     0.72 %
  Allowance for loan losses     3,809       3,724       3,740       3,729       3,556  
  Allowance for loan losses to total loans     0.99 %     0.99 %     0.99 %     1.00 %     0.98 %
  Allowance for loan losses to non-performing loans     106.55 %     100.95 %     96.87 %     97.29 %     96.57 %
  Non-performing loans to total loans     0.93 %     0.99 %     1.02 %     1.03 %     1.02 %
                                           
Capitalization                                        
                                         
  Shareholders' equity to total assets     10.99 %     11.09 %     12.41 %     12.46 %     12.37 %
                                           
Contact:
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
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