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Elmira Savings Bank Reports Third Quarter Earnings

ELMIRA, N.Y., Oct. 17, 2018 (GLOBE NEWSWIRE) -- Elmira Savings Bank (ESBK)

Highlights

  • Net income was $1,010,000 and $3,304,000 for the three and nine months ended September 30, 2018 compared to $1,215,000 and $3,402,000 for the same periods in 2017.

  • Diluted earnings per share were $.29 per share and $.95 per share for the three and nine months ended September 30, 2018 compared to $.28 per share and $.84 per share for the same periods in 2017.

  • Return on average assets was .71% and .79% for the three and nine months ended September 30, 2018 compared to .84% and .80% for the same periods in 2017.

  • Return on average equity was 6.94% and 7.69% for the three and nine months ended September 30, 2018 compared to 7.32% and 7.34% for the same periods in 2017.

“We are pleased with the positive impact the repurchase of our preferred shares has had on earnings per share, return on equity and on our dividend payout ratio,” said Thomas M. Carr, President and CEO. Carr continued, “Despite slightly lower earnings, our EPS and ROE has improved for the nine months ending September 30, 2018 compared to the same period one year ago.”

Net Income

Net income totaled $3,304,000 for the nine months ended September 30, 2018, a decrease of $98,000 or 3% from the $3,402,000 of net income recorded for the same period in 2017. This decrease was the net result of a decrease in noninterest income of $845,000, an increase in noninterest expense of $82,000, and a decrease in net interest income of $61,000, offset by a decrease in tax expense of $792,000 and a decrease in the provision for loan losses of $98,000.

Net income totaled $1,010,000 for the three months ended September 30, 2018, a decrease of $205,000 or 17% from the $1,215,000 recorded for the same period in 2017. This decrease was the net result of a decrease in noninterest income of $472,000, an increase in noninterest expense of $131,000, and an increase in the provision for loan losses of $30,000, offset by an increase in interest income of $43,000 and a decrease in tax expense of $385,000.

Basic and diluted earnings per share for the nine months ended September 30, 2018 were both $.95 per share compared to $.85 and $.84 per share for the same period in 2017. Basic and diluted earnings per share for the three months ended September 30, 2018 were both $.29 per share compared to $.29 and $.28 per share for the same period in 2017. Per share data has been restated to reflect the 5% stock dividend paid on June 15, 2018.

Net Interest Margin

The net interest margin for the nine months ended September 30, 2018 was 3.32% compared to 3.31% for the same period in 2017. The yield on average earning assets was 4.19% for the nine months ended September 30, 2018 compared to 4.12% for the same period in 2017. The average cost of interest-bearing liabilities was 1.02% for the nine months ended September 30, 2018 compared to .94% for the same period in 2017.

The net interest margin for the three months ended September 30, 2018 was 3.26% compared to 3.27% for the same period in 2017. The average yield on earning assets was 4.19% for the three months ended September 30, 2018 compared to 4.09% for the same period in 2017. The average cost of interest-bearing liabilities was 1.09% for the three months ended September 30, 2018 compared to .96% for the same period in 2017.

Assets

Total assets increased $16.2 million or 2.9% to $570.8 million at September 30, 2018 compared to $554.6 million at December 31, 2017. Loans, including loans held for sale, increased 1.9% to $469.5 million at September 30, 2018 compared to December 31, 2017. The available-for-sale investment portfolio decreased $2.4 million from December 31, 2017 to September 30, 2018.

Nonperforming Loans

Our nonperforming loans to total loans ratio has increased to 0.96% at September 30, 2018 from .64% at December 31, 2017. Net loan charge-offs to average loans for the nine months ended September 30, 2018 was 0.07% versus 0.03% for the nine months ended September 30, 2017. The allowance for loan losses was 0.95% of total loans at September 30, 2018 and 0.97% of total loans at December 31, 2017.

Liabilities

Deposits total $474.4 million at September 30, 2018, an increase of $17.7 million or 3.9%. The $17.7 million increase consists of an $15.4 million increase in time deposits, a $1.4 million increase in savings accounts, a $4.3 million increase in noninterest-bearing accounts, and a $3.0 million increase in interest bearing transaction accounts, offset by a $6.4 million decrease in money market accounts. Borrowed funds totaled at $33.0 million as of September 30, 2018, a decrease of $2.0 million from December 31, 2017.

Shareholders’ Equity

Shareholders’ equity increased $831,000 to $57.5 million at September 30, 2018 compared to December 31, 2017. The current level of shareholders’ equity equates to a book value per share of $16.42 at September 30, 2018, compared to $16.26 at December 31, 2017. Dividends paid for common shareholders were $0.23 and $0.68 for the three and nine months ended September 30, 2018 and $0.22 and $0.66 for the same periods 2017, after adjusting for the 5% stock dividend paid on June 15, 2018. As a result of the repurchase of all outstanding preferred shares in December 2017, there were no dividends paid for preferred shares for the three or nine months ended September 30, 2018 versus $225,000 and $675,000 paid in preferred dividends for the same periods in 2017.

Elmira Savings Bank, with $570.8 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 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.

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

ELMIRA SAVINGS BANK

CONSOLIDATED BALANCE SHEET

(unaudited)

(in thousands, except for share and per share data)

September 30,

December 31,

2018

2017

% Change

ASSETS

Cash and due from banks

$

18,103

$

7,800

132.1

%

Federal funds sold and other short-term investments

94

97

-3.1

%

Total cash and cash equivalents

18,197

7,897

130.4

%

Securities available for sale, at fair value

21,631

24,056

-10.1

%

Securities held to maturity - fair value $7,762

at September 30, 2018, and $8,186 at December 31, 2017

7,646

8,039

-4.9

%

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

9,675

10,221

-5.3

%

Loans held for sale

2,340

1,999

17.1

%

Loans receivable

467,134

458,629

1.9

%

Less: Allowance for loan losses

4,421

4,442

-0.5

%

Net loans

462,713

454,187

1.9

%

Premises and equipment, net

16,881

16,772

0.6

%

Bank-owned life insurance

14,349

13,982

2.6

%

Accrued interest receivable

1,509

1,497

0.8

%

Goodwill

12,320

12,320

0.0

%

Other assets

3,524

3,590

-1.8

%

Total assets

$

570,785

$

554,560

2.9

%

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits

$

474,449

$

456,762

3.9

%

Borrowings

33,000

35,000

-5.7

%

Other liabilities

5,824

6,117

-4.8

%

Total liabilities

513,273

497,879

3.1

%

Shareholders' equity:

Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares

authorized; 10,000 shares issued at September 30, 2018 and at December 31, 2017

9,700

9,700

0.0

%

Common stock, $1 par value; 5,000,000 shares authorized; 3,593,223 shares

issued at September 30, 2018 and 3,410,622 shares issued at December 31, 2017

3,593

3,411

5.3

%

Additional paid-in capital

53,657

50,258

6.8

%

Retained earnings

3,047

5,493

-44.5

%

Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares

at September 30, 2018 and December 31, 2017

(12,202

)

(12,202

)

0.0

%

Accumulated other comprehensive loss

(334

)

(31

)

977.4

%

Total Elmira Savings Bank shareholders' equity

57,461

56,629

1.5

%

Noncontrolling interest

51

52

-1.9

%

Total shareholders' equity

57,512

56,681

1.5

%

Total liabilities and shareholders' equity

$

570,785

$

554,560

2.9

%

ELMIRA SAVINGS BANK

CONSOLIDATED STATEMENT OF INCOME

(unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands, except for per share data)

2018

2017

% Change

2018

2017

% Change

Interest and dividend income:

Interest and fees on loans

$

4,896

$

4,695

4.3

%

$

14,478

$

14,219

1.8

%

Interest and dividends on securities

Taxable

246

240

2.5

%

742

712

4.2

%

Non-taxable

118

136

-13.2

%

356

481

-26.0

%

Total interest and dividend income

5,260

5,071

3.7

%

15,576

15,412

1.1

%

Interest expense:

Interest on deposits

932

757

23.1

%

2,509

2,207

13.7

%

Interest on borrowings

238

267

-10.9

%

722

799

-9.6

%

Total interest expense

1,170

1,024

14.3

%

3,231

3,006

7.5

%

Net interest income

4,090

4,047

1.1

%

12,345

12,406

-0.5

%

Provision for loan losses

150

120

25.0

%

217

315

-31.1

%

Net interest income after provision for loan losses

3,940

3,927

0.3

%

12,128

12,091

0.3

%

Noninterest income:

Service fees

344

393

-12.5

%

1,085

1,133

-4.2

%

Gain on sale of loans held for sale

392

906

-56.7

%

1,178

2,175

-45.8

%

Other service fees

214

193

10.9

%

615

555

10.8

%

Earnings on bank-owned life insurance

96

105

-8.6

%

289

296

-2.4

%

Other

108

29

272.4

%

227

80

183.8

%

Total noninterest income

1,154

1,626

-29.0

%

3,394

4,239

-19.9

%

Noninterest expense:

Salaries and benefits

1,975

2,080

-5.0

%

5,920

5,941

-0.4

%

Net occupancy

398

351

13.4

%

1,196

1,123

6.5

%

Equipment

350

317

10.4

%

1,032

935

10.4

%

Marketing and public relations

195

186

4.8

%

646

593

8.9

%

Professional fees

130

156

-16.7

%

400

508

-21.3

%

Other

843

670

25.8

%

2,257

2,269

-0.5

%

Total noninterest expense

3,891

3,760

3.5

%

11,451

11,369

0.7

%

Income before income taxes

1,203

1,793

-32.9

%

4,071

4,961

-17.9

%

Income taxes

193

578

-66.6

%

767

1,559

-50.8

%

Net income

1,010

1,215

-16.9

%

3,304

3,402

-2.9

%

Less: Net income attributable to noncontrolling interest

-

-

-

-

-

-

Net income attributable to Elmira Savings Bank

1,010

1,215

-16.9

%

3,304

3,402

-2.9

%

Dividend on preferred stock

-

225

-100.0

%

-

675

-100.0

%

Income available to common shareholders

$

1,010

$

990

2.0

%

$

3,304

$

2,727

21.2

%

Basic earnings per share

$

0.29

$

0.29

0.0

%

$

0.95

$

0.85

11.8

%

Diluted earnings per share

$

0.29

$

0.28

3.6

%

$

0.95

$

0.84

13.1

%

Weighted average shares outstanding - basic

3,480,924

3,462,924

0.5

%

3,477,690

3,219,108

8.0

%

Weighted average shares outstanding - diluted

3,496,810

3,477,499

0.6

%

3,492,445

3,235,931

7.9

%

Dividends per share

$

0.23

$

0.22

4.5

%

$

0.68

$

0.66

3.0

%

Share and per share data has been restated to reflect the 5% stock dividend paid on June 15, 2018.

ELMIRA SAVINGS BANK

AVERAGE BALANCES AND INTEREST RATES

(Dollars in Thousands)

For the Three Months Ended

September 30, 2018

September 30, 2017

ASSETS:

Average Balance

Interest

Average Rate

Average Balance

Interest

Average Rate

Loans

$

458,787

$

4,896

4.24

%

$

446,853

$

4,695

4.17

%

Short-term investments

479

2

1.61

414

1

1.52

Securities

39,448

362

3.65

45,092

375

3.31

Total interest-earning assets

498,714

5,260

4.19

492,359

5,071

4.09

Noninterest-earning assets

67,479

79,619

TOTAL ASSETS

$

566,193

$

571,978

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing deposits

$

392,762

$

932

0.94

$

381,146

$

757

0.79

Borrowings

33,000

238

2.82

41,130

267

2.54

Total interest-bearing liabilities

425,762

1,170

1.09

422,276

1,024

0.96

Noninterest-bearing liabilities

82,665

83,854

Shareholders' equity

57,766

65,848

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$

566,193

$

571,978

Interest rate spread

3.10

%

3.13

%

Net interest income/margin

$

4,090

3.26

%

$

4,047

3.27

%

ELMIRA SAVINGS BANK

AVERAGE BALANCES AND INTEREST RATES

(Dollars in Thousands)

For the Nine Months Ended

September 30, 2018

September 30, 2017

ASSETS:

Average Balance

Interest

Average Rate

Average Balance

Interest

Average Rate

Loans

$

454,076

$

14,478

4.24

%

$

450,234

$

14,219

4.20

%

Short-term investments

464

5

1.45

894

5

0.69

Securities

40,409

1,093

3.61

47,284

1,188

3.35

Total interest-earning assets

494,949

15,576

4.19

498,412

15,412

4.12

Noninterest-earning assets

64,618

68,250

TOTAL ASSETS

$

559,567

$

566,662

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing deposits

$

387,127

$

2,509

0.87

$

382,608

$

2,207

0.77

Borrowings

34,298

722

2.77

41,775

799

2.52

Total interest-bearing liabilities

421,425

3,231

1.02

424,383

3,006

0.94

Noninterest-bearing liabilities

80,683

80,315

Shareholders' equity

57,459

61,964

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$

559,567

$

566,662

Interest rate spread

3.17

%

3.18

%

Net interest income/margin

$

12,345

3.32

%

$

12,406

3.31

%

Quarter Ended

(Dollars in Thousands, Except Per Share Data)

9/30/2018

6/30/2018

3/31/2018

12/31/2017

9/30/2017

Operating Data

Net income

$

1,010

$

1,163

$

1,131

$

1,449

$

1,215

Net interest income

4,090

4,080

4,175

4,142

4,047

Provision for loan losses

150

25

42

580

120

Non-interest income, ex. Net security gains

1,154

1,130

1,110

1,198

1,626

Non-interest expense

3,891

3,732

3,828

4,515

3,760

Performance Statistics

Net interest margin

3.26

%

3.32

%

3.38

%

3.31

%

3.27

%

Annualized return on average assets

0.71

%

0.83

%

0.83

%

1.03

%

0.84

%

Annualized return on average equity

6.94

%

8.11

%

8.03

%

9.04

%

7.32

%

Annualized net loan charge-offs to avg loans

0.08

%

0.09

%

0.05

%

0.46

%

0.03

%

Net charge-offs

91

96

51

528

28

Efficiency ratio

74.2

%

71.6

%

72.4

%

84.6

%

66.3

%

Per Share Data

Basic earnings per share

$

0.29

$

0.33

$

0.32

$

0.37

$

0.29

Diluted earnings per share

0.29

0.33

0.32

0.37

0.28

Dividend declared per share

0.23

0.23

0.22

0.22

0.22

Book value

16.42

16.36

16.27

16.26

16.04

Common stock price:

High

21.00

20.60

19.95

19.90

20.10

Low

20.10

19.29

19.19

18.00

18.86

Close

20.40

20.43

19.52

19.48

19.14

Weighted average common shares:

Basic

3,481

3,477

3,474

3,467

3,463

Fully diluted

3,497

3,491

3,489

3,482

3,478

End-of-period common shares:

Issued

3,593

3,593

3,591

3,582

3,579

Treasury

94

94

94

94

94

Share and per share data has been restated to reflect the 5% stock dividend paid on June 15, 2018.

Financial Condition Data:

General

Total assets

$

570,785

$

562,924

$

553,259

$

554,560

$

565,042

Loans, net

462,713

448,690

447,131

454,187

443,543

Intangibles

12,320

12,320

12,320

12,320

12,324

Total deposits

474,449

468,293

456,322

456,762

454,826

Noninterest-bearing

78,324

76,880

73,540

74,072

75,625

Savings

71,748

73,200

70,574

70,339

68,253

NOW

89,835

87,402

86,205

86,799

87,612

Money Market

18,910

21,934

22,928

25,363

25,184

Time deposits

215,632

208,877

203,075

200,189

198,152

Total interest-bearing deposits

396,125

391,413

382,782

382,690

379,201

Shareholders' equity

57,512

57,299

56,887

56,681

65,590

Asset Quality

Non-performing assets

$

4,520

$

4,560

$

3,181

$

2,933

$

3,793

Non-performing assets to total assets

0.79

%

0.81

%

0.57

%

0.53

%

0.67

%

Allowance for loan losses

4,421

4,362

4,433

4,442

4,390

Allowance for loan losses to total loans

0.95

%

0.96

%

0.98

%

0.97

%

0.98

%

Allowance for loan losses to

non-performing loans

100.00

%

99.18

%

142.59

%

153.97

%

118.46

%

Non-performing loans to total loans

0.96

%

0.98

%

0.70

%

0.64

%

0.84

%

Capitalization

Shareholders' equity to total assets

10.08

%

10.18

%

10.28

%

10.22

%

11.61

%