CORRECTION -- Alpine Banks of Colorado Announces Financial Results for Q3 2021

GLENWOOD SPRINGS, Colo., Oct. 28, 2021 (GLOBE NEWSWIRE) -- In a release issued under the same headline on October 26, 2021, by Alpine Banks of Colorado (OTCQX: ALPIB) please note that in the fourth and fifth bullet points under "Third Quarter 2021 Achievements" the phrase "growth during second quarter" has been replaced with the phrase "growth during third quarter". The corrected release follows:

Alpine Banks of Colorado (OTCQX: ALPIB) (“Alpine” or the “Company”), the holding company for Alpine Bank, today announced results (unaudited) for the third quarter of 2021. The Company reported net income of $16.2 million, or $157.90 per basic Class A common share and $1.05 per basic Class B common share for the third quarter of 2021.

Third Quarter 2021 Achievements

• Total assets surpassed $6 billion during the third quarter of 2021 and have grown $976.3 million, or 19.01%, versus September 30, 2020

• Book value per Class A share increased 3.4%, or $131.36 to $4,009.23 per share, versus second quarter 2021

• Book value per Class B share increased 3.4%, or $0.88 to $26.73 per share, versus second quarter 2021

• Organic loan growth during third quarter 2021 was 0.6%, or $18.3 million, versus second quarter 2021

• Core deposit growth during third quarter 2021 was 5.9%, or $306.9 million, versus second quarter 2021
  

Alpine Banks of Colorado President and Vice Chairman, Glen Jammaron stated, “We are pleased to have reached a new milestone for Alpine by exceeding $6.0 billion in total assets. Our continued growth and success is testament to the strong team of employees, shareholders and customers we have built over 48 years serving Colorado. We look forward to providing for the financial needs of our communities long into the future.”

Net Income

Net income for third quarter 2021 and second quarter 2021 was $16.2 million and $15.7 million, respectively. Interest income increased $1.6 million in third quarter 2021 compared to second quarter 2021 primarily due to an increase in yields on loans and balances due from banks along with an increase in volume on securities and balances due from banks. This increase was slightly offset by a decrease in volume in loans and a decrease in yields on securities. Interest expense decreased $9,000 in third quarter 2021 compared to second quarter 2021 primarily due to a decrease in yield on deposits slightly offset by an increase in volume on deposits. Noninterest income decreased $0.8 million in third quarter 2021 compared to second quarter 2021 primarily due to a decrease in income generated by mortgage banking activities and other income slightly offset by an increase in service charges on deposit accounts. Noninterest expense increased $1.2 million in third quarter 2021 compared to second quarter 2021, primarily due to increases in furniture and fixture expense, salaries and employee benefits and other expense, slightly offset by a decrease in occupancy expense. Provision for loan losses decreased $1.1 million in third quarter 2021 compared to second quarter 2021, primarily due to asset quality improvement during the quarter and continued improvements in the economic environment.

Net income for the nine months ended September 30, 2021 and September 30, 2020, was $46.0 million and $36.9 million, respectively. Interest income increased $9.5 million in the first nine months of 2021 compared to the first nine months of 2020, primarily due to an increase in volume in loans, securities and balances due from banks, slightly offset by decreased yields on loans, securities and balances due from banks. Interest expense decreased $0.2 million in the first nine months of 2021 compared to the first nine months of 2020, primarily due to a decrease in yield on deposits, slightly offset by an increase in volume in deposits and the Company’s subordinated notes and an increase in yield on the Company’s subordinated notes. Noninterest income increased $1.1 million in the first nine months of 2021 compared to the first nine months of 2020, primarily due to an increase in fee income, service charges on deposit accounts, and other income. This increase was slightly offset by a decrease in earnings on life insurance. Noninterest expense increased $3.5 million in the first nine months of 2021 compared to the first nine months of 2020, primarily due to an increase in salary and employee benefit expenses and other expenses, slightly offset by a decrease in occupancy expenses and furniture and fixtures expenses. Provision for loan losses decreased $4.4 million in the first nine months of 2021 compared to the first nine months of 2020, primarily due to asset quality improvement during the period and continued improvements in the economic environment.

Net interest margin decreased from 3.07% to 3.00% from second quarter 2021 to third quarter 2021. Net interest margin for third quarter 2021 net of the PPP loan influence was 2.90% compared to second quarter 2021 net interest margin net of the PPP loan influence of 3.01%. Net interest margin for the nine months ended September 30, 2021 and September 30, 2020, was 3.16% and 3.87%, respectively.

Assets

As of September 30, 2021, total assets were $6.1 billion, an increase of 5.5% or $319.2 million from second quarter 2021. Total assets increased in third quarter 2021 from second quarter 2021 due to organic loan growth, strategic growth in the securities portfolio and core deposit increases. Total assets grew 19.0%, or $976.3 million, from September 30, 2020 to September 30, 2021. Alpine Bank’s Wealth Management Division* had assets under management of $1.11 billion on September 30, 2021, compared to $0.98 billion on September 30, 2020, an increase of 13.1%.

Loans

Loans outstanding as of September 30, 2021 totaled $3.3 billion. The loan portfolio decreased $74.9 million or -2.2% during third quarter 2021 compared to June 30, 2021. This decline was driven by a $60.1 million decrease in commercial and industrial loans, an $18.4 million decrease in real estate construction loans, and a $12.3 million decrease in residential real estate loans. This decline was slightly offset by growth in commercial real estate loans of $12.9 million, consumer loans of $0.9 million and other loans of $0.06 million during third quarter 2021 compared to June 30, 2021. The decrease in commercial and industrial loans was primarily the result of $93.3 million in PPP loan forgiveness pay-downs processed in third quarter 2021. Loans outstanding net of PPP loans as of September 30, 2021 reflected an increase of $18.3 million, or 0.6%, compared to loans outstanding net of PPP loans of $3.2 billion on June 30, 2021.

Loans outstanding as of September 30, 2021 reflected an increase of $94.5 million, or 3.0%, compared to loans outstanding of $3.2 billion on September 30, 2020. This growth was driven by a $152.3 million increase in commercial real estate loans, a $118.5 million increase in residential real estate loans, primarily due to an increase in one-to-four family residential loans, a $3.4 million increase in consumer loans, and a $0.01 million increase in other loans. This year-over-year growth was slightly offset by a decrease in commercial and industrial loans of $142.8 million and a decrease in real estate construction loans of $38.6 million. The decrease in commercial and industrial loans was primarily the result of $182.4 million in PPP loan forgiveness pay-downs. Loans outstanding net of PPP loans as of September 30, 2021, reflected an increase of $276.8 million, or 9.6%, compared to loans outstanding net of PPP loans of $2.9 billion on September 30, 2020.

Deposits

Total deposits increased $306.9 million, or 5.9%, to $5.5 billion during third quarter 2021 compared to June 30, 2021, primarily due to a $233.7 million increase in demand accounts, a $40.0 million increase in interest checking accounts, a $37.3 million increase in money fund accounts, and a $1.7 million increase in savings accounts. This increase was slightly offset by a $5.8 million decrease in certificate of deposit accounts. Third quarter 2021 deposit growth is partially reflective of PPP loan activity and a high amount of liquidity in the general market.

Total deposits of $5.5 billion on September 30, 2021 reflected an increase of $940.2 million or 20.7% compared to total deposits of $4.6 billion on September 30, 2020. This increase was due to a $430.5 million increase in demand deposits, a $343.0 million increase in money fund accounts, a $185.0 million increase in interest checking accounts, and a $22.6 million increase in savings accounts. This increase was slightly offset by a $40.8 million decrease in certificate of deposit accounts, primarily related to matured brokered certificates of deposit.

Capital

The Company’s banking subsidiary, Alpine Bank (the “Bank”), continues to be designated as a “well capitalized” institution as its capital ratios exceed the minimum requirements for this designation. As of September 30, 2021, the Bank’s Tier 1 Leverage Ratio was 8.13%, Tier 1 Risk-Based Capital Ratio was 13.09% and Total Risk-Based Capital Ratio was 14.25%. On a consolidated level, the Company’s Tier 1 Leverage Ratio was 7.77%, Tier 1 Risk-Based Capital Ratio was 12.50% and Total Risk-Based Capital Ratio was 15.01% as of September 30, 2021.

Dividends

During third quarter 2021, Alpine paid cash dividends of $24.00 per Class A common share and $0.16 per Class B common share. On October 14, 2021, Alpine declared a dividend of $24.00 per Class A common share and $0.16 per Class B common share, payable on November 1, 2021. These Class A and Class B common share cash dividends were unchanged from the Class A and Class B common share cash dividends paid during the second quarter 2021.

COVID-19 Pandemic Response

The Company continues to respond to the COVID-19 pandemic as circumstances change. No Bank branches are currently closed to customers due to COVID-19 outbreaks. Back office personnel returned to the office on July 6, 2021.

In order to support its customer base, Alpine enacted a 90-day loan payment deferral program in late March 2020. Both principal and interest payments during the period were deferred to the end of the loan. As the 90-day deferral period came to an end, Alpine reviewed options to extend the deferral period for up to 180 days as provided for in regulatory guidance. Reviews for an additional 90-day extension for each borrower’s deferral period included an analysis of the borrower’s plan and ability to resume normal payments when the deferral period ended. As of June 30, 2020, $823.0 million of the loan portfolio (26.5%) was active in the loan deferral program. The majority of borrowers did not require a second 90-day deferral period. On December 31, 2020, only $29.3 million (0.9%) of the loan portfolio remained in a deferral status. As of September 30, 2021, there were no loans on a COVID-19 deferral status.

The Company actively participated in round one of the PPP loan program. As of September 30, 2021, Alpine had outstanding balances of $10.1 million in Round 1 PPP loans. The Company entered into a contract with a third-party technology provider to assist with the Round 1 PPP loan forgiveness process for our borrowers. The web portal for processing Round 1 PPP forgiveness was activated in September 2020. Forgiveness activity began in the fourth quarter 2020 and the Bank has processed $300.1 million in Round 1 PPP forgiveness approvals from the SBA as of September 30, 2021. It is anticipated that the majority of remaining Round 1 PPP loans will be forgiven in the fourth quarter of 2021. The Company began actively participating in round two of the PPP loan program in late January, 2021. Alpine issued 1,965 Round 2 PPP loans during the first half of 2021, with combined original balances of $162.1 million. The Company has processed $50.1 million in Round 2 PPP forgiveness approvals from the SBA during 2021, resulting in a total outstanding balance of Round 2 PPP loans of $112.1 million, as of September 30, 2021.

About Alpine Banks of Colorado

Alpine Banks of Colorado, through its wholly owned subsidiary Alpine Bank, is a $6.1 billion, employee-owned organization founded in 1973 with headquarters in Glenwood Springs, Colorado. With banking offices across Colorado, Alpine Bank employs more than 785 people and serves more than 160,000 customers with personal, business, wealth management*, mortgage and electronic banking services. Alpine Bank has a 5-star rating for financial strength by BauerFinancial, Inc., the nation’s leading bank rating firm. The 5-star rating is BauerFinancial’s highest rating for financial institutions. Shares of the Class B Nonvoting Common Stock of Alpine Banks of Colorado trade under the symbol “ALPIB" on the OTCQX® Best Market. Learn more at www.alpinebank.com.

*Alpine Bank Wealth Management services are not FDIC insured, may lose value and are not guaranteed by the Bank.

Contacts:	Glen Jammaron	Eric Gardey
	President and Vice Chairman	Chief Financial Officer
	Alpine Banks of Colorado	Alpine Banks of Colorado
	2200 Grand Avenue	2200 Grand Avenue
	Glenwood Springs, CO 81601	Glenwood Springs, CO 81601
	(970) 384-3266	(970) 384-3257

A Note About Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements we make regarding our evaluation of macro-environment risks, Federal Reserve rate management, and trends reflecting things such as regulatory capital standards and adequacy. Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. We caution you therefore against relying on any of these forward- looking statements. They are neither statements of historical fact or guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statement include:

• The ability to attract new deposits and loans;

• Demand for financial services in our market areas;

• Competitive market-pricing factors;

• The adverse effects of public health events, such as the current COVID-19 pandemic, including governmental and societal responses;

• Statements regarding the expected impact of the stock split of our Class B common shares in December 2020;

• Deterioration in economic conditions that could result in increased loan losses;

• Actions by competitors and other market participants that could have an adverse impact on our expected performance;

• Risks associated with concentrations in real estate-related loans;

• Market interest rate volatility;

• Stability of funding sources and continued availability of borrowings;

• Risk associated with potential cyber threats;

• Changes in legal or regulatory requirements or the results of regulatory examinations that could restrict growth;

• The ability to recruit and retain key management and staff;

• The ability to raise capital or incur debt on reasonable terms; and

• Effectiveness of legislation and regulatory efforts to help the U.S. and global financial markets.
  

There are many factors that could cause actual results to differ materially from those contemplated by forward-looking statements. Any forward-looking statement made by us in this press release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Key Financial Measures

The attached tables highlight Alpine’s key financial measures for the periods indicated (unaudited).

Key Financial Measures 09/30/2021

Statement of Income 09/30/2021

Statement of Financial Condition 09/30/2021

Statement of Comprehensive Income 09/30/2021

Contact:	Eric Gardey, Chief Financial Officer
	Alpine Bank
	(970) 384-3257
	ericgardey@alpinebank.com