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Northeast Bank Reports Fourth Quarter Results and Declares Dividend

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Northeast Bank
Northeast Bank

PORTLAND, Maine, July 25, 2022 (GLOBE NEWSWIRE) -- Northeast Bank (the “Bank”) (NASDAQ: NBN), a Maine-based full-service bank, today reported net income of $10.3 million, or $1.35 per diluted common share, for the quarter ended June 30, 2022, compared to net income of $21.4 million, or $2.54 per diluted common share, for the quarter ended June 30, 2021. Net income for the year ended June 30, 2022 was $42.2 million, or $5.34 per diluted common share, compared to $71.5 million, or $8.55 per diluted common share, for the year ended June 30, 2021. Net income for the quarter and year ended June 30, 2021 included $12.6 million and $46.7 million ($8.9 million and $33.0 million, net of tax), respectively, of net gains on the sale of U.S. Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans sold during the quarter and year ended June 30, 2021, which had an after-tax earnings per diluted common share impact of $1.06 and $3.95, respectively.

The Board of Directors declared a cash dividend of $0.01 per share, payable on August 23, 2022, to shareholders of record as of August 9, 2022.

Discussing results, Rick Wayne, Chief Executive Officer, said, “We closed our fiscal year with yet another impressive quarter. Our National Lending Division had a record quarter of originations, with $172.9 million for the quarter, and $587.8 million for the fiscal year. This resulted in net growth in our originated portfolio of $235.7 million, or 45.0%, compared with June 30, 2021. In addition to the growth in loan balances, our National Lending Division’s combined yield increased to 7.9% for the quarter ended June 30, 2022, as compared to 7.7% for the quarter ended June 30, 2021. Asset quality remains strong, with past due loans of $7.0 million, or 0.53% of total loans, compared to $11.3 million, or 1.08% of total loans at June 30, 2021. This represents the lowest level of delinquencies since July 31, 2016, at which time the Bank’s loan book totaled just $688.7 million.” Mr. Wayne continued, “As a result of the increase in the average balances of our loan portfolio, we are reporting earnings of $1.35 per diluted common share, a return on average equity of 16.6%, and a return on average assets of 2.7% for the quarter.”

As of June 30, 2022, total assets were $1.58 billion, a decrease of $591.6 million, or 27.2%, from total assets of $2.17 billion as of June 30, 2021.

  1. Cash and short-term investments decreased by $838.4 million, or 83.0%, primarily due to the timing of a large deposit account related to PPP loan payoff collections at June 30, 2021, which has decreased throughout the fiscal year. Cash and short-term investments may fluctuate significantly while PPP collections, including forgiveness amounts, continue, depending on the timing of receipts and remittances of cash amounts.

  2. The following table highlights the changes in the loan portfolio for the three months and year ended June 30, 2022:

 

Loan Portfolio Changes

 

Three Months Ended June 30, 2022

 

June 30, 2022
Balance

 

March 31, 2022
Balance

 

Change ($)

 

Change (%)

 

(Dollars in thousands)

National Lending Purchased

$

477,682

 

$

479,824

 

$

(2,142)

 

 

(0.45%)

National Lending Originated

 

759,229

 

 

680,568

 

 

78,661

 

 

11.56%

SBA National

 

33,046

 

 

34,574

 

 

(1,528)

 

 

(4.42%)

Community Banking

 

34,909

 

 

37,359

 

 

(2,450)

 

 

(6.56%)

Total

$

1,304,866

 

$

1,232,325

 

$

72,541

 

 

5.89%

 

 

 

Year Ended June 30, 2022

 

June 30, 2022
Balance

 

June 30, 2021
Balance

 

Change ($)

 

Change (%)

 

(Dollars in thousands)

National Lending Purchased

$

477,682

 

$

429,054

 

$

48,628

 

 

11.33%

National Lending Originated

 

759,229

 

 

523,535

 

 

235,694

 

 

45.02%

SBA National

 

33,046

 

 

39,549

 

 

(6,503)

 

 

(16.44%)

Community Banking

 

34,909

 

 

48,486

 

 

(13,577)

 

 

(28.00%)

Total

$

1,304,866

 

$

1,040,624

 

$

264,242

 

 

25.39%

Loans generated by the Bank's National Lending Division for the quarter ended June 30, 2022 totaled $209.4 million, which consisted of $36.5 million of purchased loans, at an average price of 98.6% of unpaid principal balance, and $172.9 million of originated loans.

An overview of the Bank’s National Lending Division portfolio follows:

 

National Lending Portfolio

 

Three Months Ended June 30,

 

2022

 

2021

 

Purchased

 

Originated

 

Total

 

Purchased

 

Originated

 

Total

 

(Dollars in thousands)

Loans purchased or originated during the period:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unpaid principal balance

$

37,032

 

 

$

172,851

 

 

$

209,883

 

 

$

35,456

 

 

$

114,020

 

 

$

149,476

 

Net investment basis

 

36,502

 

 

 

172,851

 

 

 

209,353

 

 

 

33,732

 

 

 

114,020

 

 

 

147,752

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan returns during the period:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Yield

 

9.25

%

 

 

7.03

%

 

 

7.91

%

 

 

8.99

%

 

 

6.58

%

 

 

7.68

%

Total Return on Purchased Loans (1)

 

9.25

%

 

 

N/A

 

 

9.25

%

 

 

8.99

%

 

 

N/A

 

 

8.99

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended June 30,

 

2022

 

2021

 

Purchased

 

Originated

 

Total

 

Purchased

 

Originated

 

Total

 

(Dollars in thousands)

Loans purchased or originated during the period:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unpaid principal balance

$

199,523

 

 

$

587,840

 

 

$

787,363

 

 

$

181,591

 

 

$

308,862

 

 

$

490,453

 

Net investment basis

 

187,914

 

 

 

587,840

 

 

 

775,754

 

 

 

169,489

 

 

 

308,862

 

 

 

478,351

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan returns during the period:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Yield

 

8.91

%

 

 

6.73

%

 

 

7.65

%

 

 

8.91

%

 

 

6.93

%

 

 

7.84

%

Total Return on Purchased Loans (1)

 

8.92

%

 

 

N/A

 

 

8.92

%

 

 

8.91

%

 

 

N/A

 

 

8.91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans as of period end:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unpaid principal balance

$

512,006

 

 

$

759,229

 

 

$

1,271,235

 

 

$

466,059

 

 

$

523,535

 

 

$

989,594

 

Net investment basis

 

477,682

 

 

 

759,229

 

 

 

1,236,911

 

 

 

429,054

 

 

 

523,535

 

 

 

952,589

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) The total return on purchased loans represents scheduled accretion, accelerated accretion, gains on real estate owned and other noninterest income recorded during the period divided by the average invested balance, which includes purchased loans held for sale, on an annualized basis. The total return on purchased loans does not include the effect of purchased loan charge-offs or recoveries during the period. Total return on purchased loans is considered a non-GAAP financial measure. See reconciliation in below table entitled “Total Return on Purchased Loans.”

  1. Deposits decreased by $574.7 million, or 30.9%, from June 30, 2021. The decrease was attributable to decreases in demand deposits of $643.5 million, or 66.2% and time deposits of $150.5 million, or 54.2%, partially offset by an increase in savings and interest checking deposits of $260.2 million, or 80.1%. The primary reason for the net decrease in deposits was due to timing of the receipt of short-term customer funds related to PPP payoff collections prior to June 30, 2021, which were subsequently used to pay down NEWITY’s PPP Liquidity Facility (“PPPLF”) balance during the year ended June 30, 2022.

  2. Shareholders’ equity increased by $15.9 million, or 6.9%, from June 30, 2021, primarily due to net income of $42.2 million, partially offset by the repurchase of 821 thousand shares of common stock at a weighted average price per share of $34.09, which resulted in a $28.0 million decrease to shareholders’ equity. Shareholders’ equity also increased by $1.9 million as a result of stock compensation expense recognized.

Net income decreased by $11.1 million to $10.3 million for the quarter ended June 30, 2022, compared to net income of $21.4 million for the quarter ended June 30, 2021.

1. Net interest and dividend income before provision for loan losses increased by $5.5 million to $23.6 million for the quarter ended June 30, 2022, compared to $18.1 million for the quarter ended June 30, 2021. The increase was primarily due to the following:

  • An increase in interest income earned on the National Lending Division’s purchased and originated portfolios of $5.8 million, due to higher average balances and rates earned in both portfolios;

  • A decrease in deposit interest expense of $356 thousand, due to lower interest rates and a shift in portfolio composition;

  • A decrease of $282 thousand in interest expense due to the payoff of the subordinated debt; and

  • A decrease of $98 thousand in interest expense due to advances taken from the PPPLF to fund PPP originations during the quarter ended June 30, 2021; partially offset by,

  • A decrease in PPP loan interest income of $884 thousand, due to the significant decrease in PPP loans during the quarter ended June 30, 2022.

The following table summarizes interest income and related yields recognized on the loan portfolios:

 

Interest Income and Yield on Loans

 

Three Months Ended June 30,

 

2022

 

2021

 

Average

 

Interest

 

 

 

Average

 

Interest

 

 

 

Balance

 

Income

 

Yield

 

Balance

 

Income

 

Yield

 

(Dollars in thousands)

Community Banking

$

35,028

 

$

451

 

5.16

%

 

$

49,003

 

$

585

 

4.79

%

SBA National

 

33,788

 

 

522

 

6.20

%

 

 

41,331

 

 

606

 

5.88

%

National Lending:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Originated

 

720,101

 

 

12,622

 

7.03

%

 

 

501,646

 

 

8,229

 

6.58

%

Purchased

 

474,393

 

 

10,937

 

9.25

%

 

 

424,102

 

 

9,507

 

8.99

%

Total National Lending

 

1,194,494

 

 

23,559

 

7.91

%

 

 

925,748

 

 

17,736

 

7.68

%

Total excluding SBA PPP

$

1,263,310

 

$

24,532

 

7.79

%

 

$

1,016,082

 

$

18,927

 

7.47

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SBA PPP

$

-

 

$

-

 

0.00

%

 

$

172,787

 

$

884

 

2.05

%

Total including SBA PPP

$

1,263,310

 

$

24,532

 

7.79

%

 

$

1,188,869

 

$

19,811

 

6.68

%


 

Interest Income and Yield on Loans

 

Year Ended June 30,

 

2022

 

2021

 

Average

 

Interest

 

 

 

Average

 

Interest

 

 

 

Balance

 

Income

 

Yield

 

Balance

 

Income

 

Yield

 

(Dollars in thousands)

Community Banking

$

41,009

 

$

2,143

 

5.23%

 

$

56,711

 

$

2,746

 

4.84%

SBA National

 

35,678

 

 

2,356

 

6.60%

 

 

45,764

 

 

2,441

 

5.33%

National Lending:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Originated

 

627,786

 

 

42,256

 

6.73%

 

 

469,632

 

 

32,560

 

6.93%

Purchased

 

458,036

 

 

40,820

 

8.91%

 

 

400,141

 

 

35,649

 

8.91%

Total National Lending

 

1,085,822

 

 

83,076

 

7.65%

 

 

869,773

 

 

68,209

 

7.84%

Total excluding SBA PPP

$

1,162,509

 

$

87,575

 

7.53%

 

$

972,248

 

$

73,396

 

7.55%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SBA PPP

$

633

 

$

17

 

2.69%

 

$

166,230

 

$

3,522

 

2.12%

Total including SBA PPP

$

1,163,142

 

$

87,592

 

7.53%

 

$

1,138,478

 

$

76,918

 

6.76%

 

The components of total income on purchased loans are set forth in the table below entitled “Total Return on Purchased Loans.” When compared to the quarter ended June 30, 2021, transactional income increased by $1.1 million for the quarter ended June 30, 2022, and regularly scheduled interest and accretion increased by $362 thousand due to the increase in average balances. The total return on purchased loans for the quarter ended June 30, 2022 was 9.3%, an increase from 9.0% for the quarter ended June 30, 2021. The following table details the total return on purchased loans:

 

Total Return on Purchased Loans

 

Three Months Ended June 30,

 

2022

 

2021

 

Income

 

Return (1)

 

Income

 

Return (1)

 

(Dollars in thousands)

Regularly scheduled interest and accretion

$

7,432

 

6.29

%

 

$

7,070

 

6.69

%

Transactional income:

 

 

 

 

 

 

 

 

 

Gain on real estate owned

 

-

 

0.00

%

 

 

-

 

0.00

%

Accelerated accretion and loan fees

 

3,505

 

2.96

%

 

 

2,437

 

2.30

%

Total transactional income

 

3,505

 

2.96

%

 

 

2,437

 

2.30

%

Total

$

10,937

 

9.25

%

 

$

9,507

 

8.99

%

 

 

 

Year Ended June 30,

 

2022

 

2021

 

Income

 

Return (1)

 

Income

 

Return (1)

 

(Dollars in thousands)

Regularly scheduled interest and accretion

$

28,811

 

6.29

%

 

$

27,536

 

6.88

%

Transactional income:

 

 

 

 

 

 

 

 

 

Gain on real estate owned

 

31

 

0.01

%

 

 

-

 

0.00

%

Accelerated accretion and loan fees

 

12,009

 

2.62

%

 

 

8,113

 

2.03

%

Total transactional income

 

12,040

 

2.63

%

 

 

8,113

 

2.03

%

Total

$

40,851

 

8.92

%

 

$

35,649

 

8.91

%

(1) The total return on purchased loans represents scheduled accretion, accelerated accretion, and gains on real estate owned recorded during the period divided by the average invested balance, which includes purchased loans held for sale, on an annualized basis. The total return does not include the effect of purchased loan charge-offs or recoveries in the quarter. Total return is considered a non-GAAP financial measure.

2. Noninterest income decreased by $15.5 million for the quarter ended June 30, 2022, compared to the quarter ended June 30, 2021, principally due to the following:

  • A decrease in gain on sale of PPP loans of $12.6 million, due to the sale of PPP loans with a total principal balance of $671.4 million, which resulted in a net gain based on the recognition of net deferred fees in the quarter ended June 30, 2021 as compared to no sales in the quarter ended June 30, 2022; and

  • A decrease in correspondent fee income of $3.0 million from the recognition of correspondent fees and related net servicing income. Correspondent income for the quarters ended June 30, 2022 and 2021 is comprised of the following components:

 

Three Months Ended June 30,

 

2022

 

 

2021

 

 

 

(In thousands)

Correspondent Fee

$

1,067

 

 

$

1,080

Amortization of Purchased Accrued Interest

 

1,451

 

 

 

972

Earned Net Servicing Interest

 

1,168

 

 

 

4,602

Total

$

3,686

 

 

$

6,654

In addition to the net servicing interest income, a summary of PPP loans purchased by The Loan Source, Inc. (“Loan Source”) and related amounts that the Bank will earn over the expected life of the loans is as follows:





Quarter

 

PPP Loans Purchased by Loan Source(3)

 



Correspondent Fee

 



Purchased Accrued Interest(1)

 





Total(2)

 

(In thousands)

Q4 FY 2020

 

$

1,272,900

 

$

2,891

 

$

688

 

$

3,579

Q1 FY 2021

 

2,112,100

 

5,348

 

2,804

 

8,152

Q2 FY 2021

 

1,333,500

 

495

 

3,766

 

4,261

Q3 FY 2021

 

2,141,900

 

-

 

598

 

598

Q4 FY 2021

 

4,371,000

 

171

 

2,703

 

2,874

Q1 FY 2022

 

6,300

 

-

 

1

 

1

Total

 

$

11,237,700

 

$

8,905

 

$

10,560

 

$

19,465

Less amounts recognized in Q4 FY 22

 

(1,067)

 

(1,451)

 

(2,518)

Less amounts recognized in previous quarters

 

(7,342)

 

(7,883)

 

(15,225)

Amount remaining to be recognized

 

$

496

 

$

1,226

 

$

1,722


(1) - The Bank's share

(2) - Expected to be recognized into income over life of loans

(3) - Loan Source’s ending PPP loan balance was $1.44 billion as of June 30, 2022

3. Noninterest expense increased by $3.4 million for the quarter ended June 30, 2022 compared to the quarter ended June 30, 2021, primarily due to the following:

  • An increase in salaries and employee benefits expense of $3.9 million, primarily due to a $2.0 million increase in incentive compensation, which, in the prior year was adjusted during the quarter ended March 31, 2021 due to the high level of PPP-related income generated in that quarter, and also a $1.5 million decrease in deferred salaries contra-expense related to PPP originations in the quarter ended June 30, 2021; and

  • An increase in other noninterest expense of $142 thousand, primarily due to a $340 thousand increase in impairment on the SBA servicing asset and a $134 thousand increase in travel and meals and entertainment expense, partially offset by a one-time $338 thousand decrease in non-income tax expense that was reclassified out of other noninterest expense and into income tax expense; partially offset by,

  • A decrease in loan expense of $608 thousand, due to a $267 thousand decrease in collection legal expense due to reimbursements, and a $269 thousand decrease in correspondent expense.

4. Income tax expense decreased by $3.4 million to $5.5 million, or an effective tax rate of 34.8%, for the quarter ended June 30, 2022, compared to $8.9 million, or an effective tax rate of 29.4%, for the quarter ended June 30, 2021. The decrease in income tax expense is due to the decrease in pre-tax income. The increase in the effective tax rate from June 30, 2021 is primarily due to changes in state tax apportionment, as well as a one-time income tax accrual adjustment of $290 thousand during the quarter ended June 30, 2022.

As of June 30, 2022, nonperforming assets totaled $12.9 million, or 0.82% of total assets, compared to $20.4 million, or 0.94% of total assets, as of June 30, 2021. The decrease was primarily due to the sale of three other real estate owned properties totaling $1.7 million and the payoff of two nonperforming National Lending Division originated loans totaling $2.4 million and two nonperforming purchased loans totaling $3.3 million during the year ended June 30, 2022.

As of June 30, 2022, past due loans totaled $7.0 million, or 0.53% of total loans, compared to past due loans totaling $11.3 million, or 1.08% of total loans, as of June 30, 2021. The decrease was primarily due to fourteen purchased loans totaling $5.3 million that became current or paid off, partially offset by one purchased loan totaling $1.0 million that became past due during the year ended June 30, 2022.

As of June 30, 2022, the Bank’s Tier 1 leverage capital ratio was 16.1%, compared to 13.6% at June 30, 2021, and the Total capital ratio was 19.5% at June 30, 2022, compared to 24.3% at June 30, 2021. Capital ratios were primarily affected by increased earnings and decreased assets, while the Total capital ratio was negatively impacted by the redemption of the subordinated debt on July 1, 2021.

Investor Call Information
Rick Wayne, Chief Executive Officer, Jean-Pierre Lapointe, Chief Financial Officer, and Pat Dignan, Executive Vice President and Chief Credit Officer of Northeast Bank, will host a conference call to discuss fourth quarter earnings and business outlook at 10:00 a.m. Eastern Time on Tuesday, July 26th. Investors can access the call by dialing 866.374.5140 and entering the following PIN: 31924851#. The call will be available via live webcast, which can be viewed by accessing the Bank’s website at www.northeastbank.com and clicking on the About Us - Investor Relations section. To listen to the webcast, attendees are encouraged to visit the website at least fifteen minutes early to register, download and install any necessary audio software. Please note there will also be a slide presentation that will accompany the webcast. For those who cannot listen to the live broadcast, a replay will be available online for one year at www.northeastbank.com.

About Northeast Bank
Northeast Bank (NASDAQ: NBN) is a full-service bank headquartered in Portland, Maine. We offer personal and business banking services to the Maine market via seven branches. Our National Lending Division purchases and originates commercial loans on a nationwide basis. ableBanking, a division of Northeast Bank, offers online savings products to consumers nationwide. Information regarding Northeast Bank can be found at www.northeastbank.com.

Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures, including tangible common shareholders’ equity, tangible book value per share, total return on purchased loans, efficiency ratio, net interest margin excluding PPP, and net interest margin excluding PPP and collection account. The Bank’s management believes that the supplemental non-GAAP information is utilized by regulators and market analysts to evaluate a company’s financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.

Forward-Looking Statements
Statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although the Bank believes that these forward-looking statements are based on reasonable estimates and assumptions, they are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond the Bank’s control. The Bank’s actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, ongoing disruptions due to the COVID-19 pandemic; ongoing turbulence in the capital and debt markets; general business and economic conditions on a national basis and in the local markets in which the Bank operates, including changes which adversely affect borrowers’ ability to service and repay our loans; changes in customer behavior due to changing political, business and economic conditions, including concerns about inflation, or legislative or regulatory initiatives; changes in interest rates and real estate values; increases in loan defaults and charge-off rates; decreases in the value of securities and other assets, adequacy of loan loss reserves, or deposit levels necessitating increased borrowing to fund loans and investments; changing government regulation; competitive pressures from other financial institutions; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters and future pandemics; the risk that the Bank may not be successful in the implementation of its business strategy; the risk that intangibles recorded in the Bank’s financial statements will become impaired; changes in assumptions used in making such forward-looking statements; and the other risks and uncertainties detailed in the Bank’s Annual Report on Form 10-K and updated by our Quarterly Reports on Form 10-Q and other filings submitted to the Federal Deposit Insurance Corporation. These statements speak only as of the date of this release and the Bank does not undertake any obligation to update or revise any of these forward-looking statements to reflect events or circumstances occurring after the date of this communication or to reflect the occurrence of unanticipated events.

NBN-F

NORTHEAST BANK

BALANCE SHEETS

(Unaudited)

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

 

June 30, 2022

 

June 30, 2021

Assets

 

 

 

 

 

Cash and due from banks

$

2,095

 

$

2,850

Short-term investments

 

169,984

 

 

1,007,641

Total cash and cash equivalents

 

172,079

 

 

1,010,491

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale debt securities, at fair value

 

54,911

 

 

59,737

Equity securities, at fair value

 

6,798

 

 

7,230

Total investment securities

 

61,709

 

 

66,967

 

 

 

 

 

 

Loans:

 

 

 

 

 

Commercial real estate

 

882,187

 

 

725,287

Commercial and industrial

 

352,729

 

 

257,604

Residential real estate

 

69,209

 

 

56,591

Consumer

 

741

 

 

1,142

Total loans

 

1,304,866

 

 

1,040,624

Less: Allowance for loan losses

 

5,028

 

 

7,313

Loans, net

 

1,299,838

 

 

1,033,311

 

 

 

 

 

 

 

 

 

 

 

 

Premises and equipment, net

 

9,606

 

 

11,271

Real estate owned and other repossessed collateral, net

 

-

 

 

1,639

Federal Home Loan Bank stock, at cost

 

1,610

 

 

1,209

Loan servicing rights, net

 

1,285

 

 

2,061

Bank-owned life insurance

 

17,922

 

 

17,498

Other assets

 

18,710

 

 

29,955

Total assets

$

1,582,759

 

$

2,174,402

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

Deposits:

 

 

 

 

 

Demand

$

329,007

 

$

972,495

Savings and interest checking

 

585,274

 

 

325,062

Money market

 

246,095

 

 

287,033

Time

 

127,317

 

 

277,840

Total deposits

 

1,287,693

 

 

1,862,430

 

 

 

 

 

 

Federal Home Loan Bank advances

 

15,000

 

 

15,000

Subordinated debt

 

-

 

 

15,050

Lease liability

 

4,451

 

 

6,061

Other liabilities

 

27,294

 

 

43,470

Total liabilities

 

1,334,438

 

 

1,942,011

 

 

 

 

 

 

Commitments and contingencies

 

-

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' equity

 

 

 

 

 

Preferred stock, $1.00 par value, 1,000,000 shares authorized; no shares issued and outstanding at June 30, 2022 and 2021

 

-

 

 

-

Voting common stock, $1.00 par value, 25,000,000 shares authorized; 7,442,103 and 8,150,480 shares issued and outstanding at June 30, 2022 and 2021, respectively

 

7,442

 

 

8,151

Non-voting common stock, $1.00 par value, 3,000,000 shares authorized; No shares issued and outstanding at June 30, 2022 and 2021

-

 

-

Additional paid-in capital

 

38,749

 

 

64,420

Retained earnings

 

202,980

 

 

161,132

Accumulated other comprehensive loss

 

(850)

 

 

(1,312)

Total shareholders' equity

 

248,321

 

 

232,391

Total liabilities and shareholders' equity

$

1,582,759

 

$

2,174,402



NORTHEAST BANK

STATEMENTS OF INCOME

(Unaudited)

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

 

Three Months Ended June 30,

 

Year Ended June 30,

 

 

2022

 

2021

 

2022

 

2021

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

$

24,532

 

 

$

19,811

 

 

$

87,592

 

 

$

76,918

 

 

Interest on available-for-sale securities

 

81

 

 

 

113

 

 

 

316

 

 

 

754

 

 

Other interest and dividend income

 

262

 

 

 

201

 

 

 

628

 

 

 

453

 

 

Total interest and dividend income

 

24,875

 

 

 

20,125

 

 

 

88,536

 

 

 

78,125

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

Deposits

 

1,121

 

 

 

1,477

 

 

 

4,529

 

 

 

8,867

 

 

Federal Home Loan Bank advances

 

115

 

 

 

139

 

 

 

493

 

 

 

535

 

 

Paycheck Protection Program Liquidity Facility

 

-

 

 

 

98

 

 

 

-

 

 

 

400

 

 

Subordinated debt

 

-

 

 

 

282

 

 

 

-

 

 

 

1,126

 

 

Obligation under capital lease agreements

 

20

 

 

 

27

 

 

 

90

 

 

 

111

 

 

Total interest expense

 

1,256

 

 

 

2,023

 

 

 

5,112

 

 

 

11,039

 

 

Net interest and dividend income before credit for loan losses

 

23,619

 

 

 

18,102

 

 

 

83,424

 

 

 

67,086

 

 

Credit for loan losses

 

(879

)

 

 

(1,926

)

 

 

(2,462

)

 

 

(1,396

)

 

Net interest and dividend income after credit for loan losses

 

24,498

 

 

 

20,028

 

 

 

85,886

 

 

 

68,482

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fees for other services to customers

 

410

 

 

 

441

 

 

 

1,646

 

 

 

1,869

 

 

Gain on sales of PPP loans

 

-

 

 

 

12,577

 

 

 

86

 

 

 

46,701

 

 

Gain on sales of residential loans held for sale

 

-

 

 

 

1

 

 

 

-

 

 

 

107

 

 

Net unrealized gain (loss) on equity securities

 

(180

)

 

 

10

 

 

 

(511

)

 

 

(104

)

 

Gain (loss) on real estate owned, other repossessed collateral and premises and equipment, net

 

100

 

 

 

(129

)

 

 

155

 

 

 

(473

)

 

Correspondent fee income

 

3,686

 

 

 

6,654

 

 

 

22,528

 

 

 

23,452

 

 

Bank-owned life insurance income

 

107

 

 

 

106

 

 

 

424

 

 

 

424

 

 

Other noninterest income (loss)

 

21

 

 

 

(10

)

 

 

117

 

 

 

57

 

 

Total noninterest income

 

4,144

 

 

 

19,650

 

 

 

24,445

 

 

 

72,033

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

8,912

 

 

 

4,994

 

 

 

31,138

 

 

 

22,430

 

 

Occupancy and equipment expense

 

891

 

 

 

912

 

 

 

3,558

 

 

 

3,825

 

 

Professional fees

 

437

 

 

 

525

 

 

 

1,891

 

 

 

1,930

 

 

Data processing fees

 

1,203

 

 

 

1,076

 

 

 

4,544

 

 

 

4,468

 

 

Marketing expense

 

223

 

 

 

252

 

 

 

733

 

 

 

542

 

 

Loan acquisition and collection expense

 

291

 

 

 

899

 

 

 

3,202

 

 

 

3,267

 

 

FDIC insurance premiums

 

97

 

 

 

109

 

 

 

395

 

 

 

283

 

 

Other noninterest expense

 

802

 

 

 

660

 

 

 

3,322

 

 

 

2,681

 

 

Total noninterest expense

 

12,856

 

 

 

9,427

 

 

 

48,783

 

 

 

39,426

 

 

Income before income tax expense

 

15,786

 

 

 

30,251

 

 

 

61,548

 

 

 

101,089

 

 

Income tax expense

 

5,490

 

 

 

8,881

 

 

 

19,385

 

 

 

29,586

 

 

Net income

$

10,296

 

 

$

21,370

 

 

$

42,163

 

 

$

71,503

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

7,506,465

 

 

 

8,318,689

 

 

 

7,806,626

 

 

 

8,275,577

 

 

Diluted

 

7,617,933

 

 

 

8,397,897

 

 

 

7,902,610

 

 

 

8,360,355

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

1.37

 

 

$

2.57

 

 

$

5.40

 

 

$

8.64

 

 

Diluted

 

1.35

 

 

 

2.54

 

 

 

5.34

 

 

 

8.55

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per common share

$

0.01

 

 

$

0.01

 

 

$

0.04

 

 

$

0.04

 

 



NORTHEAST BANK

AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS

(Unaudited)

(Dollars in thousands)

 

Three Months Ended June 30,

 

2022

 

2021

 

 

 

Interest

 

Average

 

 

 

Interest

 

Average

 

Average

 

Income/

 

Yield/

 

Average

 

Income/

 

Yield/

 

Balance

 

Expense

 

Rate

 

Balance

 

Expense

 

Rate

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities

$

62,347

 

$

81

 

0.52

%

 

$

67,423

 

$

113

 

0.67

%

Loans (1) (2) (3)

 

1,263,310

 

 

24,532

 

7.79

%

 

 

1,188,869

 

 

19,811

 

6.68

%

Federal Home Loan Bank stock

 

1,513

 

 

7

 

1.86

%

 

 

1,825

 

 

9

 

1.98

%

Short-term investments (4)

 

168,059

 

 

255

 

0.61

%

 

 

561,813

 

 

192

 

0.14

%

Total interest-earning assets

 

1,495,229

 

 

24,875

 

6.67

%

 

 

1,819,930

 

 

20,125

 

4.44

%

Cash and due from banks

 

2,667

 

 

 

 

 

 

 

2,805

 

 

 

 

 

Other non-interest earning assets

 

45,742

 

 

 

 

 

 

 

60,923

 

 

 

 

 

Total assets

$

1,543,638

 

 

 

 

 

 

$

1,883,658

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities & Shareholders’ Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW accounts

$

410,628

 

$

391

 

0.38

%

 

$

238,462

 

$

167

 

0.28

%

Money market accounts

 

263,540

 

 

215

 

0.33

%

 

 

311,753

 

 

258

 

0.33

%

Savings accounts

 

141,526

 

 

204

 

0.58

%

 

 

46,087

 

 

19

 

0.17

%

Time deposits

 

119,235

 

 

311

 

1.05

%

 

 

289,705

 

 

1,033

 

1.43

%

Total interest-bearing deposits

 

934,929

 

 

1,121

 

0.48

%

 

 

886,007

 

 

1,477

 

0.67

%

Federal Home Loan Bank advances

 

15,000

 

 

115

 

3.08

%

 

 

27,348

 

 

139

 

2.04

%

PPPLF advances

 

-

 

 

-

 

0.00

%

 

 

115,571

 

 

98

 

0.34

%

Subordinated debt

 

-

 

 

-

 

0.00

%

 

 

15,035

 

 

282

 

7.52

%

Capital lease obligations

 

4,615

 

 

20

 

1.74

%

 

 

6,202

 

 

27

 

1.75

%

Total interest-bearing liabilities

 

954,544

 

 

1,256

 

0.53

%

 

 

1,050,163

 

 

2,023

 

0.77

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits and escrow accounts

 

326,690

 

 

 

 

 

 

 

573,724

 

 

 

 

 

Other liabilities

 

12,881

 

 

 

 

 

 

 

34,034

 

 

 

 

 

Total liabilities

 

1,294,115

 

 

 

 

 

 

 

1,657,921

 

 

 

 

 

Shareholders' equity

 

249,523

 

 

 

 

 

 

 

225,737

 

 

 

 

 

Total liabilities and shareholders’ equity

$

1,543,638

 

 

 

 

 

 

$

1,883,658

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

$

23,619

 

 

 

 

 

 

$

18,102

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate spread

 

 

 

 

 

 

6.14

%

 

 

 

 

 

 

 

3.67

%

Net interest margin (5)

 

 

 

 

 

 

6.34

%

 

 

 

 

 

 

 

3.99

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of funds (6)

 

 

 

 

 

 

0.39

%

 

 

 

 

 

 

 

0.51

%

 

(1) Interest income and yield are stated on a fully tax-equivalent basis using the statutory tax rate.

(2) Includes loans held for sale.

(3) Nonaccrual loans are included in the computation of average, but unpaid interest has not been included for purposes of determining interest income.

(4) Short-term investments include FHLB overnight deposits and other interest-bearing deposits.

(5) Net interest margin is calculated as net interest income divided by total interest-earning assets.

(6) Cost of funds is calculated as total interest expense divided by total interest-bearing liabilities plus demand deposits and escrow accounts.




NORTHEAST BANK

AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS

(Unaudited)

(Dollars in thousands)

 

Year Ended June 30,

 

2022

 

2021

 

 

 

Interest

 

Average

 

 

 

Interest

 

Average

 

Average

 

Income/

 

Yield/

 

Average

 

Income/

 

Yield/

 

Balance

 

Expense

 

Rate

 

Balance

 

Expense

 

Rate

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities

$

64,560

 

$

316

 

0.49

%

 

$

69,762

 

$

754

 

1.08

%

Loans (1) (2) (3)

 

1,163,142

 

 

87,592

 

7.53

%

 

 

1,138,478

 

 

76,918

 

6.76

%

Federal Home Loan Bank stock

 

1,306

 

 

26

 

1.99

%

 

 

1,750

 

 

61

 

3.49

%

Short-term investments (4)

 

290,167

 

 

602

 

0.21

%

 

 

314,405

 

 

392

 

0.12

%

Total interest-earning assets

 

1,519,175

 

 

88,536

 

5.83

%

 

 

1,524,395

 

 

78,125

 

5.12

%

Cash and due from banks

 

2,681

 

 

 

 

 

 

 

2,728

 

 

 

 

 

Other non-interest earning assets

 

49,503

 

 

 

 

 

 

 

50,909

 

 

 

 

 

Total assets

$

1,571,359

 

 

 

 

 

 

$

1,578,032

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities & Shareholders’ Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW accounts

$

330,228

 

$

960

 

0.29

%

 

$

167,505

 

$

495

 

0.30

%

Money market accounts

 

265,116

 

 

806

 

0.30

%

 

 

312,537

 

 

1,517

 

0.49

%

Savings accounts

 

110,145

 

 

565

 

0.51

%

 

 

39,844

 

 

57

 

0.14

%

Time deposits

 

185,347

 

 

2,198

 

1.19

%

 

 

424,894

 

 

6,798

 

1.60

%

Total interest-bearing deposits

 

890,836

 

 

4,529

 

0.51

%

 

 

944,780

 

 

8,867

 

0.94

%

Federal Home Loan Bank advances

 

15,000

 

 

493

 

3.29

%

 

 

24,072

 

 

535

 

2.22

%

PPPLF advances

 

-

 

 

-

 

0.00

%

 

 

114,341

 

 

400

 

0.35

%

Subordinated debt

 

-

 

 

-

 

0.00

%

 

 

14,995

 

 

1,126

 

7.51

%

Capital lease obligations

 

5,228

 

 

90

 

1.72

%

 

 

5,895

 

 

111

 

1.88

%

Total interest-bearing liabilities

 

911,064

 

 

5,112

 

0.56

%

 

 

1,104,083

 

 

11,039

 

1.00

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits and escrow accounts

 

403,760

 

 

 

 

 

 

 

261,322

 

 

 

 

 

Other liabilities

 

14,167

 

 

 

 

 

 

 

21,643

 

 

 

 

 

Total liabilities

 

1,328,991

 

 

 

 

 

 

 

1,387,048

 

 

 

 

 

Shareholders' equity

 

242,368

 

 

 

 

 

 

 

190,984

 

 

 

 

 

Total liabilities and shareholders’ equity

$

1,571,359

 

 

 

 

 

 

$

1,578,032

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

$

83,424

 

 

 

 

 

 

$

67,086

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate spread

 

 

 

 

 

 

5.27

%

 

 

 

 

 

 

 

4.12

%

Net interest margin (5)

 

 

 

 

 

 

5.49

%

 

 

 

 

 

 

 

4.40

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of funds (6)

 

 

 

 

 

 

0.39

%

 

 

 

 

 

 

 

0.81

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Interest income and yield are stated on a fully tax-equivalent basis using the statutory tax rate.

(2) Includes loans held for sale.

(3) Nonaccrual loans are included in the computation of average, but unpaid interest has not been included for purposes of determining interest income.

(4) Short-term investments include FHLB overnight deposits and other interest-bearing deposits.

(5) Net interest margin is calculated as net interest income divided by total interest-earning assets.

(6) Cost of funds is calculated as total interest expense divided by total interest-bearing liabilities plus demand deposits and escrow accounts.


 

NORTHEAST BANK

SELECTED FINANCIAL HIGHLIGHTS AND OTHER DATA

(Unaudited)

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

 

Three Months Ended

 

June 30, 2022

 

March 31, 2022

 

December 31, 2021

 

September 30, 2021

 

June 30, 2021



Net interest income

$

23,619

 

 

$

20,952

 

 

$

20,055

 

 

$

18,799

 

 

$

18,102

 

Credit for loan losses

 

(879

)

 

 

(287

)

 

 

(1,069

)

 

 

(226

)

 

 

(1,926

)

Noninterest income

 

4,144

 

 

 

5,408

 

 

 

6,493

 

 

 

8,399

 

 

 

19,650

 

Noninterest expense

 

12,856

 

 

 

11,401

 

 

 

11,187

 

 

 

13,338

 

 

 

9,427

 

Net income

 

10,296

 

 

 

10,587

 

 

 

11,403

 

 

 

9,877

 

 

 

21,370

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

7,506,465

 

 

 

7,687,737

 

 

 

7,952,938

 

 

 

8,132,131

 

 

 

8,318,689

 

Diluted

 

7,617,933

 

 

 

7,790,963

 

 

 

8,041,476

 

 

 

8,212,836

 

 

 

8,397,897

 



Earnings per common share:

 

 

 

 

 

 

 

 

 

Basic

$

1.37

 

 

$

1.38

 

 

$

1.43

 

 

$

1.21

 

 

$

2.57

 

Diluted

 

1.35

 

 

 

1.36

 

 

 

1.42

 

 

 

1.20

 

 

 

2.54

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per common share

$

0.01

 

 

$

0.01

 

 

$

0.01

 

 

$

0.01

 

 

$

0.01

 

 

 

 

 

 

 

 

 

 

 

Return on average assets

 

2.68

%

 

 

2.79

%

 

 

2.86

%

 

 

2.41

%

 

 

4.55

%

Return on average equity

 

16.55

%

 

 

17.57

%

 

 

18.77

%

 

 

16.70

%

 

 

37.97

%

Net interest rate spread (1)

 

6.14

%

 

 

5.52

%

 

 

4.99

%

 

 

4.46

%

 

 

3.67

%

Net interest margin (2)

 

6.34

%

 

 

5.71

%

 

 

5.24

%

 

 

4.74

%

 

 

3.99

%

Net interest margin, excluding PPP (non-GAAP) (3)

 

6.34

%

 

 

5.71

%

 

 

5.24

%

 

 

4.75

%

 

 

4.55

%

Net interest margin, excluding PPP and collection account (non-GAAP) (4)

 

7.07

%

 

 

6.72

%

 

 

6.44

%

 

 

6.00

%

 

 

5.56

%

Efficiency ratio (non-GAAP) (5)

 

46.31

%

 

 

43.25

%

 

 

42.14

%

 

 

49.04

%

 

 

24.97

%

Noninterest expense to average total assets

 

3.34

%

 

 

3.01

%

 

 

2.80

%

 

 

3.26

%

 

 

2.01

%

Average interest-earning assets to average interest-bearing liabilities

 

156.64

%

 

 

167.20

%

 

 

168.71

%

 

 

174.98

%

 

 

173.30

%

 

 

 

 

 

 

 

 

 

 

 

As of:

 

June 30, 2022

 

March 31, 2022

 

December 31, 2021

 

September 30, 2021

 

June 30, 2021

Nonperforming loans:

 

 

 

 

 

 

 

 

 

Originated portfolio:

 

 

 

 

 

 

 

 

 

Residential real estate

$

550

 

 

$

621

 

 

$

611

 

 

$

619

 

 

$

696

 

Commercial real estate

 

5,031

 

 

 

6,608

 

 

 

7,963

 

 

 

6,644

 

 

 

5,756

 

Commercial and industrial

 

202

 

 

 

230

 

 

 

311

 

 

 

1,510

 

 

 

286

 

Consumer

 

11

 

 

 

12

 

 

 

20

 

 

 

39

 

 

 

43

 

Total originated portfolio

 

5,794

 

 

 

7,471

 

 

 

8,905

 

 

 

8,812

 

 

 

6,781

 

Total purchased portfolio

 

7,152

 

 

 

10,441

 

 

 

12,294

 

 

 

12,527

 

 

 

11,977

 

Total nonperforming loans

 

12,946

 

 

 

17,912

 

 

 

21,199

 

 

 

21,339

 

 

 

18,758

 

Real estate owned and other repossessed collateral, net

 

-

 

 

 

-

 

 

 

53

 

 

 

821

 

 

 

1,639

 

Total nonperforming assets

$

12,946

 

 

$

17,912

 

 

$

21,252

 

 

$

22,160

 

 

$

20,397

 

 

 

 

 

 

 

 

 

 

 

Past due loans to total loans

 

0.53

%

 

 

1.07

%

 

 

1.23

%

 

 

1.39

%

 

 

1.08

%

Nonperforming loans to total loans

 

0.99

%

 

 

1.45

%

 

 

1.79

%

 

 

1.99

%

 

 

1.80

%

Nonperforming assets to total assets

 

0.82

%

 

 

1.14

%

 

 

1.46

%

 

 

1.60

%

 

 

0.94

%

Allowance for loan losses to total loans

 

0.39

%

 

 

0.47

%

 

 

0.51

%

 

 

0.67

%

 

 

0.70

%

Allowance for loan losses to nonperforming loans

 

38.34

%

 

 

32.47

%

 

 

28.49

%

 

 

33.58

%

 

 

38.99

%

 

 

 

 

 

 

 

 

 

 

Commercial real estate loans to total capital (6)

 

294.20

%

 

 

252.90

%

 

 

260.40

%

 

 

232.10

%

 

 

215.38

%

Net loans to core deposits (7) (10)

 

100.94

%

 

 

97.19

%

 

 

102.53

%

 

 

98.96

%

 

 

55.71

%

Purchased loans to total loans, including held for sale

 

36.61

%

 

 

38.94

%

 

 

41.02

%

 

 

40.22

%

 

 

41.23

%

Equity to total assets

 

15.69

%

 

 

15.80

%

 

 

16.39

%

 

 

17.32

%

 

 

10.69

%

Common equity tier 1 capital ratio

 

19.08

%

 

 

20.13

%

 

 

20.27

%

 

 

22.03

%

 

 

22.16

%

Total capital ratio

 

19.47

%

 

 

20.60

%

 

 

20.79

%

 

 

22.69

%

 

 

24.29

%

Tier 1 leverage capital ratio

 

16.13

%

 

 

16.17

%

 

 

15.19

%

 

 

14.83

%

 

 

13.63

%

 

 

 

 

 

 

 

 

 

 

Total shareholders’ equity

$

248,321

 

 

$

247,469

 

 

$

239,237

 

 

$

239,508

 

 

$

232,391

 

Less: Preferred stock

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Common shareholders’ equity

 

248,321

 

 

 

247,469

 

 

 

239,237

 

 

 

239,508

 

 

 

232,391

 

Less: Intangible assets (8)

 

(1,285

)

 

 

(1,696

)

 

 

(1,645

)

 

 

(1,906

)

 

 

(2,061

)

Tangible common shareholders' equity (non-GAAP)

$

247,036

 

 

$

245,773

 

 

$

237,592

 

 

$

237,602

 

 

$

230,330

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding

 

7,442,103

 

 

 

7,727,312

 

 

 

7,815,566

 

 

 

8,172,776

 

 

 

8,150,480

 

Book value per common share

$

33.37

 

 

$

32.03

 

 

$

30.61

 

 

$

29.31

 

 

$

28.51

 

Tangible book value per share (non-GAAP) (9)

 

33.19

 

 

 

31.81

 

 

 

30.40

 

 

 

29.07

 

 

 

28.26

 

 

 

 

 

 

 

 

 

 

 

(1) The net interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted-average cost of interest-bearing liabilities for the period.

(2) The net interest margin represents net interest income as a percent of average interest-earning assets for the period.

(3) Net interest margin excluding PPP removes the effects of the following: PPP loan interest income of $3 thousand, $2 thousand, $11 thousand, and $884 thousand, PPPLF interest expense of $0, $0, $0, and $98 thousand, as well as PPP loan average balances of $462 thousand, $628 thousand, $1.4 million, and $172.8 million, for the quarters ended March 31, 2022, December 31, 2021, September 30, 2021, and June 30, 2021, respectively.

(4) Net interest margin excluding PPP and collection account removes the PPP impact above and removes the effects of the cash held by the Bank from the correspondent’s collection account in short-term investments, which had an average balance of $175.2 million, $244.0 million, $287.7 million, $334.3 million, and $405.9 million, and earned $362 thousand, $60 thousand, $73 thousand, $84 thousand, and $100 thousand, in interest income for the quarters ended June 30, 2022, March 31, 2022, December 31, 2021, September 30, 2021, and June 30, 2021, respectively.

(5) The efficiency ratio represents noninterest expense divided by the sum of net interest income (before the loan loss provision) plus noninterest income.

(6) For purposes of calculating this ratio, commercial real estate includes all non-owner occupied commercial real estate loans defined as such by regulatory guidance, including all land development and construction loans.

(7) Core deposits include all non-maturity deposits and maturity deposits less than $250 thousand. During the quarter ended June 30, 2022, the Bank changed its internal policy limit to calculate based on deposits, not core deposits. Ratio as of June 30, 2022 reflects loans to deposits. Loans include loans held for sale.

(8) Includes the loan servicing rights asset.

(9) Tangible book value per share represents total shareholders’ equity less the sum of preferred stock and intangible assets divided by common shares outstanding.

(10) Net loans and total loans exclude PPP loans held for sale.

For More Information:
Jean-Pierre Lapointe, Chief Financial Officer
Northeast Bank, 27 Pearl Street, Portland, ME 04101
207.786.3245 ext. 3220
www.northeastbank.com