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Elmira Savings Bank Reports 2016 Earnings

NEW YORK, NY--(Marketwired - Jan 25, 2017) - Elmira Savings Bank (NASDAQ: ESBK)

Highlights

  • Net income was $1,042,000 and $4,337,000 for the three and twelve months ended December 31, 2016 compared to $1,036,000 and $4,122,000 for the same periods in 2015.

  • Diluted earnings per share were $.30 per share and $1.25 per share for the three and twelve months ended December 31, 2016 compared to $.30 per share and $1.17 per share for the same periods in 2015.

  • Return on average assets (annualized) was .73% and .76% for the three and twelve months ended December 31, 2016 compared to .73% for both of the same periods in 2015.

  • Return on average equity (annualized) was 7.38% and 7.77% for the three and twelve months ended December 31, 2016 compared to 7.46% and 7.43% for the same periods in 2015.

Net Income

Net income totaled $1,042,000 for the three months ended December 31, 2016, an increase of $6,000 or 0.6% from the $1,036,000 recorded for the same period in 2015. This increase was the net result of a decrease in the provision for loan losses of $95,000, an increase in net interest income of $27,000, and an increase in noninterest income of $13,000, offset by an increase in noninterest expense of $111,000 and an increase in income tax expense of $18,000.

Net income totaled $4,337,000 for the twelve months ended December 31, 2016, an increase of $215,000 or 5.2% from the $4,122,000 of net income recorded for the same period in 2015. This increase was the net result of an increase in net interest income of $886,000, an increase in noninterest income of $509,000, and a decrease in the provision for loan losses of $143,000, offset by an increase in noninterest expense of $1.0 million and an increase in income tax expense of $314,000.

"The company has continued to make progress in 2016. Year over year, we have increased our noninterest income by 9%, our net interest income by 6%, and have expanded our net interest margin by 5%" said Thomas M. Carr, President and CEO. Carr continued, "We are pleased with the increase in core earnings supported by strong mortgage loan origination volume and a 7% growth in deposits."

Basic and diluted earnings per share for the twelve months ended December 31, 2016 were $1.26 per share and $1.25 per share compared to $1.19 per share and $1.17 per share for the same period in 2015. Both basic and diluted earnings per share for the three months ended December 31, 2016 were $.30 per share and $.30 per share for both basic and diluted earnings per share for the same period in 2015.

Net Interest Margin

The net interest margin for the twelve months ended December 31, 2016 was 3.21% compared to 3.07% for the same period in 2015. The yield on average earning assets was 4.05% for the twelve months ended December 31, 2016 compared to 4.06% for the same period in 2015. The average cost of interest-bearing liabilities was 1.00% for the twelve months ended December 31, 2016 compared to 1.16% for the same period in 2015.

The net interest margin for the three months ended December 31, 2016 was 3.23% compared to 3.19% for the same period in 2015. The average yield on earning assets was 4.04% for the three months ended December 31, 2016 compared to 4.09% for the same period in 2015. The average cost of interest-bearing liabilities was 0.95% for the three months ended December 31, 2016 compared to 1.07% for the same period in 2015.

Assets

Total assets increased $12.1 million or 2.2% to $573.5 million at December 31, 2016 compared to $561.3 million at December 31, 2015. Loans receivable increased 1.0% to $455.9 million at December 31, 2016 compared to December 31, 2015. The available-for-sale investment portfolio decreased $10.1 million from December 31, 2015 to December 31, 2016.

Nonperforming Loans

Our nonperforming loans to total loans ratio was 1.11% at December 31, 2016 compared to 1.05% at December 31, 2015. Net loan charge-offs to average loans for the twelve months ended December 31, 2016 of 0.08% decreased from 0.11% for the twelve months ended December 31, 2015. The allowance for loan losses was 0.94% of total loans at December 31, 2016 and 0.92% of total loans at December 31, 2015.

Liabilities

Deposits total $469.5 million at December 31, 2016, an increase of $29.1 million or 6.6%. The $29.1 million increase consists of a $17.8 million increase in time deposits, a $5.5 million increase in money market accounts, a $3.7 million increase in savings accounts, and a $3.4 million increase in noninterest-bearing accounts, offset by a $1.3 million decrease in interest-bearing transaction accounts. Borrowed funds decreased by $17.5 million or 29.4%.

Shareholders' Equity

Shareholders' equity increased $1.0 million to $55.7 million at December 31, 2016 compared to December 31, 2015. The current level of shareholders' equity equates to a book value per share of $16.74 at December 31, 2016, compared to $16.53 at December 31, 2015. Dividends paid to common shareholders were $0.23 and $0.92 for the three and twelve months ended both December 31, 2016 and 2015.

Elmira Savings Bank, with $573.5 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 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)

December 31,

December 31,

2016

2015

% Change

ASSETS

Cash and due from banks

$

24,195

$

5,352

352.1

%

Federal funds sold and other short-term investments

99

102

-2.9

%

Total cash and cash equivalents

24,294

5,454

345.4

%

Securities available for sale, at fair value

32,581

42,709

-23.7

%

Securities held to maturity - fair value $8,679 at December 31, 2016 and $9,010 at December 31, 2015


8,519


9,003


-5.4

%

Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost

9,811

11,108

-11.7

%

Loans held for sale

3,597

3,630

-0.9

%

Loans receivable

455,931

451,368

1.0

%

Less: Allowance for loan losses

4,263

4,148

2.8

%

Net loans

451,668

447,220

1.0

%

Premises and equipment, net

12,634

12,130

4.2

%

Bank-owned life insurance

13,592

13,188

3.1

%

Accrued interest receivable

1,552

1,541

0.7

%

Intangible assets, net

20

61

-67.2

%

Goodwill

12,320

12,320

0.0

%

Other assets

2,862

2,980

-4.0

%

Total assets

$

573,450

$

561,344

2.2

%

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits

$

469,547

$

440,472

6.6

%

Borrowings

42,000

59,525

-29.4

%

Other liabilities

6,180

6,576

-6.0

%

Total liabilities

517,727

506,573

2.2

%

Shareholders' equity:

Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares authorized; 10,000 shares issued at December 31, 2016 and at December 31, 2015


9,700


9,700


0.0

%

Common stock, $1 par value; authorized 5,000,000 shares; 2,844,670 shares issued at December 31, 2016 and 2,820,745 shares issued at December 31, 2015


2,845


2,821


0.9

%

Additional paid-in capital

41,644

41,243

1.0

%

Retained earnings

4,407

3,488

26.3

%

Treasury stock, at cost - 98,118 shares at December 31, 2016 and December 31, 2015


(2,907

)


(2,907

)


0.0

%

Accumulated other comprehensive income

(19

)

373

-105.1

%

Total Elmira Savings Bank shareholders' equity

55,670

54,718

1.7

%

Noncontrolling interest

53

53

0.0

%

Total shareholders' equity

55,723

54,771

1.7

%

Total liabilities and shareholders' equity

$

573,450

$

561,344

2.2

%

ELMIRA SAVINGS BANK

CONSOLIDATED STATEMENT OF INCOME

(unaudited)

Three Months Ended

Twelve Months Ended

December 31,

December 31,

(in thousands, except for per share data)

2016

2015

% Change

2016

2015

% Change

Interest and dividend income:

Interest and fees on loans

$

4,751

$

4,762

-0.2

%

$

19,056

$

18,418

3.5

%

Interest and dividends on securities

Taxable

242

304

-20.4

%

1,000

1,367

-26.8

%

Non-taxable

205

240

-14.6

%

832

949

-12.3

%

Total interest and dividend income

5,198

5,306

-2.0

%

20,888

20,734

0.7

%

Interest expense:

Interest on deposits

773

762

1.4

%

3,055

3,016

1.3

%

Interest on borrowings

270

416

-35.1

%

1,313

2,084

-37.0

%

Total interest expense

1,043

1,178

-11.5

%

4,368

5,100

-14.4

%

Net interest income

4,155

4,128

0.7

%

16,520

15,634

5.7

%

Provision for loan losses

175

270

-35.2

%

487

630

-22.7

%

Net interest income after provision for loan losses

3,980

3,858

3.2

%

16,033

15,004

6.9

%

Noninterest income:

Service fees

331

372

-11.0

%

1,420

1,471

-3.5

%

Gain on sale of loans held for sale

771

701

10.0

%

3,061

2,382

28.5

%

Gain on sale of securities

-

-

-

180

284

-36.6

%

Other service fees

172

184

-6.5

%

728

716

1.7

%

Earnings on bank-owned life insurance

99

100

-1.0

%

403

398

1.3

%

Other

22

25

-12.0

%

108

140

-22.9

%

Total noninterest income

1,395

1,382

0.9

%

5,900

5,391

9.4

%

Noninterest expense:

Salaries and benefits

1,944

1,917

1.4

%

7,927

7,324

8.2

%

Net occupancy

341

337

1.2

%

1,416

1,383

2.4

%

Equipment

314

281

11.7

%

1,200

1,061

13.1

%

Marketing and public relations

215

197

9.1

%

794

832

-4.6

%

Professional fees

(5

)

145

-103.4

%

517

773

-33.1

%

Other

1,079

900

19.9

%

3,748

3,220

16.4

%

Total noninterest expense

3,888

3,777

2.9

%

15,602

14,593

6.9

%

Income before income taxes

1,487

1,463

1.6

%

6,331

5,802

9.1

%

Income taxes

440

422

4.3

%

1,989

1,675

18.7

%

Net income

1,047

1,041

0.6

%

4,342

4,127

5.2

%

Less: Net income attributable to noncontrolling interest

5

5

0.0

%

5

5

0.0

%

Net income attibutable to Elmira Savings Bank

1,042

1,036

0.6

%

4,337

4,122

5.2

%

Dividend on preferred stock

225

225

0.0

%

900

900

0.0

%

Income available to common shareholders

$

817

$

811

0.7

%

$

3,437

$

3,222

6.7

%

Basic earnings per share

$

0.30

$

0.30

0.0

%

$

1.26

$

1.19

5.9

%

Diluted earnings per share

$

0.30

$

0.30

0.0

%

$

1.25

$

1.17

6.8

%

Weighted average shares outstanding - basic

2,731,266

2,712,052

0.7

%

2,772,243

2,707,491

2.4

%

Weighted average shares outstanding - diluted

2,749,828

2,731,078

0.7

%

2,739,668

2,762,332

-0.8

%

Dividends per share

$

0.23

$

0.23

0.0

%

$

0.92

$

0.92

0.0

%

ELMIRA SAVINGS BANK

AVERAGE BALANCES AND INTEREST RATES

(Dollars in Thousands)

For the Three Months Ended

December 31, 2016

December 31, 2015

ASSETS:

Average Balance

Interest

Average Rate

Average Balance

Interest

Average Rate

Loans

$

458,772

$

4,751

4.12

%

$

447,731

$

4,762

4.23

%

Short-term investments

789

-

0.17

177

-

0.10

Securities

52,464

447

3.39

67,996

544

3.19

Total interest-earning assets

512,025

5,198

4.04

515,904

5,306

4.09

Noninterest-earning assets

58,067

47,119

TOTAL ASSETS

$

570,092

$

563,023

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing deposits

$

394,401

$

773

0.78

$

369,180

$

762

0.82

Borrowings

42,000

270

2.51

64,134

416

2.54

Total interest-bearing liabilities

436,401

1,043

0.95

433,314

1,178

1.07

Noninterest-bearing liabilities

77,531

74,581

Shareholders' equity

56,160

55,128

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$

570,092

$

563,023

Interest rate spread

3.09

%

3.02

%

Net interest income/margin

$

4,155

3.23

%

$

4,128

3.19

%

ELMIRA SAVINGS BANK

AVERAGE BALANCES AND INTEREST RATES

(Dollars in Thousands)

For the Twelve Months Ended

December 31, 2016

December 31, 2015

ASSETS:

Average Balance

Interest

Average Rate

Average Balance

Interest

Average Rate

Loans

$

458,840

$

19,056

4.14

%

$

433,397

$

18,418

4.24

%

Short-term investments

586

1

0.18

847

-

0.03

Securities

54,449

1,831

3.36

75,228

2,316

3.08

Total interest-earning assets

513,875

20,888

4.05

509,472

20,734

4.06

Noninterest-earning assets

53,301

54,990

TOTAL ASSETS

$

567,176

$

564,462

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing deposits

$

386,818

$

3,055

0.79

$

365,142

$

3,016

0.83

Borrowings

48,788

1,313

2.65

70,773

2,084

2.90

Total interest-bearing liabilities

435,606

4,368

1.00

435,915

5,100

1.16

Noninterest-bearing liabilities

75,782

73,103

Shareholders' equity

55,788

55,444

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$

567,176

$

564,462

Interest rate spread

3.05

%

2.90

%

Net interest income/margin

$

16,520

3.21

%

$

15,634

3.07

%

Quarter Ended

(Dollars in Thousands, Except Per Share Data)

12/31/2016

9/30/2016

6/30/2016

3/31/2016

12/31/2015

Operating Data

Net income

$

1,042

$

1,202

$

1,057

$

1,036

$

1,036

Net interest income

4,155

4,211

4,054

4,100

4,128

Provision for loan losses

175

87

85

140

270

Net security gains

-

-

-

180

-

Non-interest income, ex. Net security gains

1,395

1,716

1,438

1,171

1,382

Non-interest expense

3,888

3,976

3,891

3,847

3,777

Performance Statistics

Net interest margin

3.23

%

3.24

%

3.17

%

3.19

%

3.19

%

Annualized return on average assets

0.73

%

0.84

%

0.75

%

0.74

%

0.73

%

Annualized return on average equity

7.38

%

8.54

%

7.65

%

7.52

%

7.46

%

Annualized net loan charge-offs to avg loans

0.20

%

0.05

%

0.01

%

0.07

%

0.18

%

Net charge-offs (recoveries)

231

53

14

74

204

Efficiency ratio

70.1

%

67.1

%

70.8

%

70.6

%

68.5

%

Per Share Data

Basic earnings per share

$

0.30

$

0.36

$

0.31

$

0.30

$

0.30

Diluted earnings per share

0.30

0.36

0.30

0.30

0.30

Dividend declared per share

0.23

0.23

0.23

0.23

0.23

Book value

16.74

16.80

16.69

16.59

16.53

Common stock price:

High

22.25

21.50

20.10

20.55

21.13

Low

18.50

18.85

18.06

16.83

18.41

Close

20.45

19.91

19.66

18.01

19.88

Weighted average common shares:

Basic

2,731

2,724

2,718

2,716

2,712

Fully diluted

2,750

2,741

2,735

2,733

2,731

End-of-period common shares:

Issued

2,845

2,839

2,832

2,828

2,821

Treasury

98

98

98

98

98

Financial Condition Data:

General

Total assets

$

573,450

$

567,450

$

574,721

$

560,020

$

561,344

Loans, net

451,668

455,251

463,104

452,718

447,220

Intangibles

12,340

12,349

12,360

12,371

12,381

Total deposits

469,547

463,414

470,462

443,552

440,472

Noninterest-bearing

70,330

72,102

70,803

65,165

66,964

Savings

70,621

69,019

69,159

67,295

66,914

NOW

85,822

86,787

121,875

105,094

87,083

Money Market

28,889

25,715

25,172

25,281

23,382

Time deposits

213,885

209,791

183,453

180,717

196,129

Total interest-bearing deposits

399,217

391,312

399,659

378,387

373,508

Shareholders' equity

55,723

55,792

55,382

55,039

54,771

Asset Quality

Non-performing assets

$

5,289

$

5,345

$

5,622

$

5,328

$

4,943

Non-performing assets to total assets

0.92

%

0.94

%

0.98

%

0.95

%

0.88

%

Allowance for loan losses

4,263

4,319

4,285

4,214

4,148

Allowance for loan losses to total loans

0.94

%

0.94

%

0.92

%

0.92

%

0.92

%

Allowance for loan losses to non-performing loans

84.80

%

85.00

%

80.41

%

83.69

%

87.66

%

Non-performing loans to total loans

1.11

%

1.12

%

1.15

%

1.10

%

1.05

%

Capitalization

Shareholders' equity to total assets

9.72

%

9.83

%

9.64

%

9.83

%

9.76

%