SB Financial Group Announces First Quarter 2023 Results

DEFIANCE, Ohio, April 20, 2023 (GLOBE NEWSWIRE) -- SB Financial Group, Inc. (NASDAQ: SBFG) (“SB Financial” or the “Company”), a diversified financial services company providing full-service community banking, mortgage banking, wealth management, private client and title insurance services today reported earnings for the first quarter ended March 31, 2023.

First quarter 2023 highlights:

  • Net income of $2.5 million decreased 12.9 percent compared to the prior year with diluted earnings per share (“EPS”) of $0.35

  • Adjusted for Mortgage Servicing Rights recapture (“OMSR”), net income is higher by 14.0 percent compared to the prior year

  • Noninterest expense of $10.8 million declined 0.8 percent from the prior year

  • Loan growth of $14.2 million from the linked quarter, or 5.9 percent annualized

  • Deposit growth of $23.5 million from the linked quarter, or 8.6 percent annualized

  • Stable asset quality with nonperforming assets at 35 basis points

Earnings Highlights

Three Months Ended

($ in thousands, except per share & ratios)

Mar. 2023

Mar. 2022

% Change

Operating revenue

$

13,990

$

14,279

-2.0%

Interest income

 

13,824

 

9,395

47.1%

Interest expense

 

3,500

 

918

281.3%

Net interest income

 

10,324

 

8,477

21.8%

Provision for credit losses

 

250

 

-

0.0%

Noninterest income

 

3,666

 

5,802

-36.8%

Noninterest expense

 

10,773

 

10,859

-0.8%

Net income

 

2,450

 

2,813

-12.9%

Earnings per diluted share

 

0.35

 

0.40

-12.5%

Return on average assets

 

0.73%

 

0.83%

-12.0%

Return on average equity

 

8.37%

 

8.08%

3.6%

 

 

 

 

 

 

“Our Company experienced the volatility of the banking sector this quarter and it has impacted our earnings results,” said Mark A. Klein, Chairman, President, and CEO of SB Financial. “Liquidity concerns resulted in a much more competitive arena for deposits and funding in the quarter, which drove our deposit beta significantly higher and reduced margin income. We still were able to add loan balances in the quarter even as we have begun to examine all of our credit underwriting standards.”

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RESULTS OF OPERATIONS

Consolidated Revenue

Total operating revenue, consisting of net interest income and noninterest income, was down from both the linked quarter and the prior year quarter by 4.3 and 2.0 percent, respectively. Operating revenue was negatively impacted by the decline in mortgage banking revenue and higher funding costs.

  • Net interest income was down 5.3 percent from the linked quarter but up 21.8 percent from the year ago quarter.

  • Net interest margin was up from the prior year by 68 basis points, primarily from the shift in mix of our balance sheet with cash and securities reallocated to the loan portfolio offset by the shift in our funding mix to higher cost term deposits.  

  • Noninterest income was down 36.8 percent from the year ago quarter, due to lower mortgage volume and OMSR recapture.

Mortgage Loan Business

Mortgage loan originations for the first quarter of 2023 were $49.3 million, down $48.0 million, or 49.3 percent, from the year-ago quarter; likewise, total sales of originated loans were $22.6 million, down $49.5 million, or 68.7 percent.

Net mortgage banking revenue, consisting of gains on the sale of mortgage loans and net loan servicing fees, was $1.2 million for the first quarter of 2023, compared to $2.9 million for the year-ago quarter. The mortgage servicing valuation adjustment for the first quarter of 2023 was a positive $0.1 million, compared to a positive adjustment of $0.9 million for the first quarter of 2022. The servicing portfolio at March 31, 2023, was $1.34 billion, which was down 2.3 percent to the prior year.

Mr. Klein noted, “While we added producers in our high growth markets of Indianapolis and Columbus, mortgage origination volume was constrained by the rate environment. Our pipelines are improving and notably nearly 75 percent of the pipeline is saleable product, which is back to our more normal business model.”

Mortgage Banking

 

 

 

 

 

 

 

($ in thousands)

Mar. 2023

 

Dec. 2022

 

Sep. 2022

 

Jun. 2022

 

Mar. 2022

 

 

Annual Growth

Mortgage originations

$

49,366

 

$

51,219

 

$

68,557

 

$

95,454

 

$

97,394

 

 

$

(48,028

)

Mortgage sales

 

25,803

 

 

23,590

 

 

39,176

 

 

49,915

 

 

72,154

 

 

 

(46,351

)

Mortgage servicing portfolio

 

1,344,158

 

 

1,352,016

 

 

1,362,666

 

 

1,369,732

 

 

1,375,554

 

 

 

(31,396

)

Mortgage servicing rights

 

13,548

 

 

13,503

 

 

13,473

 

 

13,408

 

 

13,135

 

 

 

413

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage servicing revenue

 

 

 

 

 

 

 

Loan servicing fees

 

844

 

 

851

 

 

858

 

 

863

 

 

861

 

 

 

(17

)

OMSR amortization

 

(292

)

 

(310

)

 

(396

)

 

(496

)

 

(547

)

 

 

255

 

Net administrative fees

 

552

 

 

541

 

 

462

 

 

367

 

 

314

 

 

 

238

 

OMSR valuation adjustment

 

56

 

 

86

 

 

65

 

 

239

 

 

890

 

 

 

(834

)

Net loan servicing fees

 

608

 

 

627

 

 

527

 

 

606

 

 

1,204

 

 

 

(596

)

Gain on sale of mortgages

 

599

 

 

550

 

 

876

 

 

1,196

 

 

1,676

 

 

 

(1,077

)

Mortgage banking revenue, net

$

1,207

 

$

1,177

 

$

1,403

 

$

1,802

 

$

2,880

 

 

$

(1,673

)

 

 

 

 

 

 

 

 

Noninterest Income and Noninterest Expense

Noninterest income declined for the first quarter, from both the linked quarter and prior year. Gain-on-sale from mortgage loans were down significantly from the prior year and total sales were down over $46 million. The Title insurance business was off nearly 40 percent, reflecting the lower level of residential volume.

For the first quarter of 2023, noninterest expense of $10.8 million was down $0.1 million or 0.8 percent compared to the prior year quarter. Overall head count is down from the linked quarter by 4.9 percent as we continue to right size the mortgage business line. Commission expense for both mortgage and SBA is down compared to the prior year due to the lower total origination volume.

Mr. Klein stated, “We have undertaken a full scale review of our expense structure as we understand the headwinds that revenue growth will encounter in 2023. Our mortgage business line infrastructure has been reduced and we are looking at other areas to provide meaningful expense reductions.”

Noninterest Income / Noninterest Expense

 

 

 

 

 

 

($ in thousands, except ratios)

Mar. 2023

 

Dec. 2022

 

Sep. 2022

 

Jun. 2022

 

Mar. 2022

 

 

Annual Growth

Noninterest Income (NII)

$

3,666

 

$

3,713

 

$

4,043

 

$

4,673

 

$

5,802

 

 

$

(2,136

)

NII / Total Revenue

 

26.2%

 

 

25.4%

 

 

27.9%

 

 

32.8%

 

 

40.6%

 

 

 

-14.4%

 

NII / Average Assets

 

1.1%

 

 

1.1%

 

 

1.2%

 

 

1.4%

 

 

1.7%

 

 

 

-0.6%

 

Total Revenue Growth

 

-2.0%

 

 

-6.7%

 

 

-13.2%

 

 

-9.1%

 

 

-46.9%

 

 

 

44.9%

 

 

 

 

 

 

 

 

 

Noninterest Expense (NIE)

$

10,773

 

$

10,269

 

$

10,384

 

$

10,802

 

$

10,859

 

 

$

(86

)

Efficiency Ratio

 

76.9%

 

 

70.2%

 

 

71.6%

 

 

75.6%

 

 

75.9%

 

 

 

1.0%

 

NIE / Average Assets

 

3.2%

 

 

3.1%

 

 

3.2%

 

 

3.3%

 

 

3.2%

 

 

 

0.0%

 

Net Noninterest Expense/Avg. Assets

 

-2.1%

 

 

-2.0%

 

 

-2.0%

 

 

-1.9%

 

 

-1.5%

 

 

 

-0.6%

 

Total Expense Growth

 

-0.8%

 

 

-11.2%

 

 

-7.7%

 

 

-2.5%

 

 

-0.5%

 

 

 

-0.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet

Total assets as of March 31, 2023, were $1.34 billion, or in line with the year ago quarter primarily due to the increase in the loan portfolio which was offset by declines in cash and investments. Total shareholders’ equity as of March 31, 2023, was $119.8 million, down from the prior year but compared to the linked quarter was higher due to the declining impairment of our bond portfolio. Excluding the impact of the valuation adjustment, equity increased $3.1 million or 2.1 percent. Our adoption of CECL on January 1st resulted in a reduction of equity that was transferred into our allowance for credit losses. SB Financial repurchased 56,000 shares of our stock during the quarter.

The investment portfolio of $237.9 million, represented 17.7 percent of assets at March 31, 2023, and was down $27.4 million or 10.3 percent from the year-ago period. Total loans held for investment were $976.3 million at March 31, 2023, up $125.6 million, or 14.8 percent, from March 31, 2022.

Deposit balances of $1.11 billion at March 31, 2023, decreased by $27.9 million, or 2.5 percent, since March 31, 2022. However, deposits have increased from the linked quarter by $23.5 million and have increased for three consecutive quarters. The growth in deposits has come with a significant shift in the mix as time deposits now comprise 21.1 percent of the total compared to 13.1 percent at March 31, 2022.

Mr. Klein continued, “Loan growth continued in the quarter and compared to the prior year we have increased our loan portfolio by over $125 million which has led to a positive mix shift on the asset side of the balance sheet. Like every community bank, the quest for deposits and low-cost funding was challenging. We are pleased that we have been able to grow deposits over the last three quarters, albeit at a higher cost.”

Loan Balances

 

 

 

 

 

 

($ in thousands, except ratios)

Mar. 2023

 

Dec. 2022

 

Sep. 2022

 

Jun. 2022

 

Mar. 2022

 

Annual Growth

 

Commercial

$

126,065

 

$

128,534

 

$

128,565

 

$

127,711

 

$

124,857

 

$

1,208

 

% of Total

 

12.9%

 

 

13.4%

 

 

13.9%

 

 

14.3%

 

 

14.7%

 

 

1.0%

 

Commercial RE

 

419,024

 

 

412,636

 

 

404,710

 

 

404,260

 

 

400,101

 

 

18,923

 

% of Total

 

42.9%

 

 

42.9%

 

 

43.7%

 

 

45.1%

 

 

47.0%

 

 

4.7%

 

Agriculture

 

57,761

 

 

64,388

 

 

60,522

 

 

60,586

 

 

55,741

 

 

2,020

 

% of Total

 

5.9%

 

 

6.7%

 

 

6.5%

 

 

6.8%

 

 

6.6%

 

 

3.6%

 

Residential RE

 

309,684

 

 

291,512

 

 

267,135

 

 

241,614

 

 

214,015

 

 

95,669

 

% of Total

 

31.7%

 

 

30.3%

 

 

28.9%

 

 

27.0%

 

 

25.2%

 

 

44.7%

 

Consumer & Other

 

63,778

 

 

65,005

 

 

64,317

 

 

61,440

 

 

55,957

 

 

7,821

 

% of Total

 

6.5%

 

 

6.8%

 

 

7.0%

 

 

6.9%

 

 

6.6%

 

 

14.0%

 

Total Loans

$

976,312

 

$

962,075

 

$

925,249

 

$

895,611

 

$

850,671

 

$

125,641

 

Total Growth Percentage

 

 

 

 

 

 

 

 

14.8%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit Balances

 

 

 

 

 

 

($ in thousands, except ratios)

Mar. 2023

 

Dec. 2022

 

Sep. 2022

 

Jun. 2022

 

Mar. 2022

 

Annual Growth

 

Non-Int DDA

$

237,175

 

$

256,799

 

$

250,791

 

$

239,676

 

$

252,273

 

$

(15,098

)

% of Total

 

21.4%

 

 

23.6%

 

 

23.1%

 

 

22.4%

 

 

22.2%

 

 

-6.0%

 

Interest DDA

 

188,497

 

 

191,719

 

 

199,523

 

 

198,286

 

 

211,152

 

 

(22,655

)

% of Total

 

17.0%

 

 

17.6%

 

 

18.4%

 

 

18.5%

 

 

18.6%

 

 

-10.7%

 

Savings

 

227,974

 

 

191,272

 

 

201,402

 

 

215,285

 

 

236,394

 

 

(8,420

)

% of Total

 

20.5%

 

 

17.6%

 

 

18.5%

 

 

20.1%

 

 

20.8%

 

 

-3.6%

 

Money Market

 

222,203

 

 

255,995

 

 

258,975

 

 

276,274

 

 

289,699

 

 

(67,496

)

% of Total

 

20.0%

 

 

23.6%

 

 

23.8%

 

 

25.8%

 

 

25.5%

 

 

-23.3%

 

Time Deposits

 

234,295

 

 

190,880

 

 

175,202

 

 

142,258

 

 

148,553

 

 

85,742

 

% of Total

 

21.1%

 

 

17.6%

 

 

16.1%

 

 

13.3%

 

 

13.1%

 

 

57.7%

 

Total Deposits

$

1,110,144

 

$

1,086,665

 

$

1,085,893

 

$

1,071,779

 

$

1,138,071

 

$

(27,927

)

Total Growth Percentage

 

 

 

 

 

 

 

 

-2.5%

 

 

 

 

 

 

 

 

Asset Quality

SB Financial reported nonperforming assets of $4.7 million as of March 31, 2023, down $0.9 million or 16.0 percent from the year-ago quarter. The coverage ratio of problem loans to the allowance for credit losses was at 382.4 percent at March 31, 2023, which was up over 100 basis points from the prior year due in large part to the expansion of the allowance from the CECL adjustment of $1.4 million.

Nonperforming Assets

 

 

 

 

 

Annual Change

 

($ in thousands, except ratios)

Mar. 2023

 

Dec. 2022

 

Sep. 2022

 

Jun. 2022

 

Mar. 2022

 

 

Commercial & Agriculture

$

185

 

$

114

 

$

114

 

$

140

 

$

142

 

$

43

 

% of Total Com./Ag. loans

 

0.10%

 

 

0.06%

 

 

0.06%

 

 

0.07%

 

 

0.08%

 

 

30.3%

 

Commercial RE

 

199

 

 

210

 

 

223

 

 

359

 

 

544

 

 

(345

)

% of Total CRE loans

 

0.05%

 

 

0.05%

 

 

0.06%

 

 

0.09%

 

 

0.14%

 

 

-63.4%

 

Residential RE

 

2,742

 

 

2,967

 

 

3,129

 

 

3,176

 

 

3,198

 

 

(456

)

% of Total Res. RE loans

 

0.89%

 

 

1.02%

 

 

1.17%

 

 

1.31%

 

 

1.49%

 

 

-14.3%

 

Consumer & Other

 

270

 

 

391

 

 

280

 

 

323

 

 

409

 

 

(139

)

% of Total Con./Oth. loans

 

0.42%

 

 

0.60%

 

 

0.44%

 

 

0.53%

 

 

0.73%

 

 

-34.0%

 

Total Nonaccruing Loans

 

3,396

 

 

3,682

 

 

3,746

 

 

3,998

 

 

4,293

 

 

(897

)

% of Total loans

 

0.35%

 

 

0.38%

 

 

0.40%

 

 

0.45%

 

 

0.50%

 

 

-20.9%

 

Accruing Restructured Loans

 

642

 

 

654

 

 

668

 

 

683

 

 

762

 

 

(120

)

Total Change (%)

 

 

 

 

 

 

-15.7%

 

Total Nonaccruing & Restructured Loans

 

4,038

 

 

4,336

 

 

4,414

 

 

4,681

 

 

5,055

 

 

(1,017

)

% of Total loans

 

0.41%

 

 

0.45%

 

 

0.48%

 

 

0.52%

 

 

0.59%

 

 

-20.1%

 

Foreclosed Assets and Other Assets

 

650

 

 

777

 

 

756

 

 

730

 

 

527

 

 

123

 

Total Change (%)

 

 

 

 

 

 

23.3%

 

Total Nonperforming Assets

$

4,688

 

$

5,113

 

$

5,170

 

$

5,411

 

$

5,582

 

$

(894

)

% of Total assets

 

0.35%

 

 

0.38%

 

 

0.40%

 

 

0.42%

 

 

0.42%

 

 

-16.0%

 

 

 

 

 

 

 

 

Webcast and Conference Call

The Company will hold the first quarter 2023 earnings conference call and webcast on April 21, 2023, at 11:00 a.m. EDT. Interested parties may access the conference call by dialing 1-888-338-9469. The webcast can be accessed at ir.yourstatebank.com. An audio replay of the call will be available on the Company’s website.

About SB Financial Group

Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title). State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 23 offices: 22 in nine Ohio counties and one in Fort Wayne, Indiana, and 23 ATMs. State Bank has six loan production offices located throughout the Tri-State region of Ohio, Indiana and Michigan. Peak Title provides title insurance and title opinions throughout the Tri-State region. SB Financial’s common stock is listed on the NASDAQ Capital Market with the ticker symbol “SBFG”.

Forward-Looking Statements

Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, the duration and scope of the COVID-19 outbreak in the United States and the market areas in which SB Financial and its subsidiaries operate, including the impact to the state and local economies of prolonged shelter in place orders and the pandemic generally, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial’s Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Non-GAAP financial measures, specifically pre-tax, pre-provision income, tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common equity, total interest income – FTE, net interest income – FTE and net interest margin – FTE are used by the Company’s management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. In addition, the Company excludes the OMSR impairment from net income to report anon-GAAP adjusted net income level. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Investor Contact Information:

Mark A. Klein
Chairman, President and
Chief Executive Officer
Mark.Klein@YourStateBank.com

Anthony V. Cosentino
Executive Vice President and
Chief Financial Officer
Tony.Cosentino@YourStateBank.com


SB FINANCIAL GROUP, INC.

CONSOLIDATED BALANCE SHEETS - (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

March

 

December

 

September

 

June

 

March

($ in thousands)

 

2023

 

 

 

2022

 

 

 

2022

 

 

 

2022

 

 

 

2022

 

ASSETS

 

 

 

 

 

 

 

 

 

Cash and due from banks

$

21,625

 

 

$

27,817

 

 

$

27,934

 

 

$

29,567

 

 

$

130,003

 

Interest bearing time deposits

 

1,380

 

 

 

2,131

 

 

 

2,134

 

 

 

1,691

 

 

 

1,894

 

Available-for-sale securities

 

237,917

 

 

 

238,780

 

 

 

243,233

 

 

 

266,162

 

 

 

265,311

 

Loans held for sale

 

5,592

 

 

 

2,073

 

 

 

2,979

 

 

 

4,242

 

 

 

4,737

 

Loans, net of unearned income

 

976,312

 

 

 

962,075

 

 

 

925,249

 

 

 

895,611

 

 

 

850,671

 

Allowance for credit losses

 

(15,442

)

 

 

(13,818

)

 

 

(13,824

)

 

 

(13,801

)

 

 

(13,804

)

Premises and equipment, net

 

22,621

 

 

 

22,829

 

 

 

22,842

 

 

 

23,122

 

 

 

23,039

 

Federal Reserve and FHLB Stock, at cost

 

6,054

 

 

 

6,326

 

 

 

5,230

 

 

 

5,303

 

 

 

5,303

 

Foreclosed assets and other assets

 

650

 

 

 

777

 

 

 

756

 

 

 

730

 

 

 

527

 

Interest receivable

 

3,926

 

 

 

4,091

 

 

 

3,556

 

 

 

3,256

 

 

 

2,815

 

Goodwill

 

23,239

 

 

 

23,239

 

 

 

23,239

 

 

 

23,239

 

 

 

23,239

 

Cash value of life insurance

 

29,024

 

 

 

28,870

 

 

 

28,713

 

 

 

28,556

 

 

 

17,932

 

Mortgage servicing rights

 

13,548

 

 

 

13,503

 

 

 

13,473

 

 

 

13,408

 

 

 

13,135

 

Other assets

 

14,847

 

 

 

16,940

 

 

 

17,863

 

 

 

12,886

 

 

 

10,328

 

Total assets

$

1,341,293

 

 

$

1,335,633

 

 

$

1,303,377

 

 

$

1,293,972

 

 

$

1,335,130

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

Non interest bearing demand

$

237,175

 

 

$

256,799

 

 

$

250,791

 

 

$

239,676

 

 

$

252,273

 

Interest bearing demand

 

188,497

 

 

 

191,719

 

 

 

199,523

 

 

 

198,286

 

 

 

211,152

 

Savings

 

227,974

 

 

 

191,272

 

 

 

201,402

 

 

 

215,285

 

 

 

236,394

 

Money market

 

222,203

 

 

 

255,995

 

 

 

258,975

 

 

 

276,274

 

 

 

289,699

 

Time deposits

 

234,295

 

 

 

190,880

 

 

 

175,202

 

 

 

142,258

 

 

 

148,553

 

Total deposits

 

1,110,144

 

 

 

1,086,665

 

 

 

1,085,893

 

 

 

1,071,779

 

 

 

1,138,071

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

 

15,998

 

 

 

14,923

 

 

 

19,754

 

 

 

30,772

 

 

 

19,035

 

Federal Home Loan Bank advances

 

44,500

 

 

 

60,000

 

 

 

35,000

 

 

 

25,000

 

 

 

5,500

 

Trust preferred securities

 

10,310

 

 

 

10,310

 

 

 

10,310

 

 

 

10,310

 

 

 

10,310

 

Subordinated debt net of issuance costs

 

19,606

 

 

 

19,594

 

 

 

19,582

 

 

 

19,570

 

 

 

19,558

 

Interest payable

 

1,441

 

 

 

769

 

 

 

623

 

 

 

307

 

 

 

536

 

Other liabilities

 

19,535

 

 

 

24,944

 

 

 

17,587

 

 

 

11,678

 

 

 

9,483

 

Total liabilities

 

1,221,534

 

 

 

1,217,205

 

 

 

1,188,749

 

 

 

1,169,416

 

 

 

1,202,493

 

 

 

 

 

 

 

 

 

 

 

Shareholders' Equity

 

 

 

 

 

 

 

 

 

Common stock

 

61,319

 

 

 

61,319

 

 

 

61,319

 

 

 

61,319

 

 

 

61,319

 

Additional paid-in capital

 

14,953

 

 

 

15,087

 

 

 

15,000

 

 

 

15,069

 

 

 

14,872

 

Retained earnings

 

101,548

 

 

 

101,966

 

 

 

99,309

 

 

 

96,809

 

 

 

94,833

 

Accumulated other comprehensive income (loss)

 

(29,671

)

 

 

(32,120

)

 

 

(33,426

)

 

 

(22,210

)

 

 

(13,659

)

Treasury stock

 

(28,390

)

 

 

(27,824

)

 

 

(27,574

)

 

 

(26,431

)

 

 

(24,728

)

Total shareholders' equity

 

119,759

 

 

 

118,428

 

 

 

114,628

 

 

 

124,556

 

 

 

132,637

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders' equity

$

1,341,293

 

 

$

1,335,633

 

 

$

1,303,377

 

 

$

1,293,972

 

 

$

1,335,130

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


SB FINANCIAL GROUP, INC.

CONSOLIDATED STATEMENTS OF INCOME - (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

($ in thousands, except per share & ratios)

At and for the Three Months Ended

 

Six Months Ended

 

March

 

December

 

September

 

June

 

March

 

June

 

June

Interest income

 

2023

 

 

 

2022

 

 

 

2022

 

 

 

2022

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

$

12,126

 

 

$

11,222

 

 

$

10,084

 

 

$

8,880

 

 

$

8,052

 

 

$

12,126

 

 

$

16,932

 

Tax exempt

 

116

 

 

 

109

 

 

 

92

 

 

 

73

 

 

 

61

 

 

 

116

 

 

 

134

 

Securities

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

1,535

 

 

 

1,559

 

 

 

1,536

 

 

 

1,469

 

 

 

1,235

 

 

 

1,535

 

 

 

2,704

 

Tax exempt

 

47

 

 

 

47

 

 

 

52

 

 

 

52

 

 

 

47

 

 

 

47

 

 

 

99

 

Total interest income

 

13,824

 

 

 

12,937

 

 

 

11,764

 

 

 

10,474

 

 

 

9,395

 

 

 

13,824

 

 

 

19,869

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

2,578

 

 

 

1,440

 

 

 

852

 

 

 

567

 

 

 

618

 

 

 

2,578

 

 

 

1,185

 

Repurchase agreements & other

 

10

 

 

 

7

 

 

 

8

 

 

 

11

 

 

 

13

 

 

 

10

 

 

 

24

 

Federal Home Loan Bank advances

 

553

 

 

 

258

 

 

 

180

 

 

 

38

 

 

 

39

 

 

 

553

 

 

 

77

 

Trust preferred securities

 

164

 

 

 

138

 

 

 

99

 

 

 

71

 

 

 

53

 

 

 

164

 

 

 

124

 

Subordinated debt

 

195

 

 

 

194

 

 

 

195

 

 

 

194

 

 

 

195

 

 

 

195

 

 

 

389

 

Total interest expense

 

3,500

 

 

 

2,037

 

 

 

1,334

 

 

 

881

 

 

 

918

 

 

 

3,500

 

 

 

1,799

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

10,324

 

 

 

10,900

 

 

 

10,430

 

 

 

9,593

 

 

 

8,477

 

 

 

10,324

 

 

 

18,070

 

Provision for credit losses

 

250

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

250

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income after provision for loan losses

 

10,074

 

 

 

10,900

 

 

 

10,430

 

 

 

9,593

 

 

 

8,477

 

 

 

10,074

 

 

 

18,070

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income

 

 

 

 

 

 

 

 

 

 

 

 

 

Wealth management fees

 

917

 

 

 

907

 

 

 

930

 

 

 

936

 

 

 

955

 

 

 

917

 

 

 

1,891

 

Customer service fees

 

825

 

 

 

880

 

 

 

844

 

 

 

860

 

 

 

794

 

 

 

825

 

 

 

1,654

 

Gain on sale of mtg. loans & OMSR

 

599

 

 

 

550

 

 

 

876

 

 

 

1,196

 

 

 

1,676

 

 

 

599

 

 

 

2,872

 

Mortgage loan servicing fees, net

 

608

 

 

 

627

 

 

 

527

 

 

 

606

 

 

 

1,204

 

 

 

608

 

 

 

1,810

 

Gain on sale of non-mortgage loans

 

24

 

 

 

105

 

 

 

125

 

 

 

167

 

 

 

169

 

 

 

24

 

 

 

336

 

Title insurance revenue

 

373

 

 

 

454

 

 

 

476

 

 

 

697

 

 

 

602

 

 

 

373

 

 

 

1,299

 

Gain (loss) on sale of assets

 

(11

)

 

 

18

 

 

 

(12

)

 

 

-

 

 

 

55

 

 

 

(11

)

 

 

55

 

Other

 

331

 

 

 

172

 

 

 

277

 

 

 

211

 

 

 

347

 

 

 

331

 

 

 

558

 

Total noninterest income

 

3,666

 

 

 

3,713

 

 

 

4,043

 

 

 

4,673

 

 

 

5,802

 

 

 

3,666

 

 

 

10,475

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

5,913

 

 

 

5,677

 

 

 

5,858

 

 

 

6,418

 

 

 

6,189

 

 

 

5,913

 

 

 

12,607

 

Net occupancy expense

 

784

 

 

 

763

 

 

 

769

 

 

 

719

 

 

 

742

 

 

 

784

 

 

 

1,461

 

Equipment expense

 

981

 

 

 

1,017

 

 

 

918

 

 

 

827

 

 

 

854

 

 

 

981

 

 

 

1,681

 

Data processing fees

 

646

 

 

 

627

 

 

 

664

 

 

 

643

 

 

 

576

 

 

 

646

 

 

 

1,219

 

Professional fees

 

863

 

 

 

738

 

 

 

766

 

 

 

760

 

 

 

950

 

 

 

863

 

 

 

1,710

 

Marketing expense

 

198

 

 

 

258

 

 

 

200

 

 

 

222

 

 

 

231

 

 

 

198

 

 

 

453

 

Telephone and communication expense

 

121

 

 

 

124

 

 

 

134

 

 

 

105

 

 

 

111

 

 

 

121

 

 

 

216

 

Postage and delivery expense

 

87

 

 

 

121

 

 

 

75

 

 

 

110

 

 

 

116

 

 

 

87

 

 

 

226

 

State, local and other taxes

 

228

 

 

 

277

 

 

 

250

 

 

 

277

 

 

 

278

 

 

 

228

 

 

 

555

 

Employee expense

 

188

 

 

 

157

 

 

 

145

 

 

 

175

 

 

 

136

 

 

 

188

 

 

 

311

 

Other expenses

 

764

 

 

 

510

 

 

 

605

 

 

 

546

 

 

 

676

 

 

 

764

 

 

 

1,222

 

Total noninterest expense

 

10,773

 

 

 

10,269

 

 

 

10,384

 

 

 

10,802

 

 

 

10,859

 

 

 

10,773

 

 

 

21,661

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax expense

 

2,967

 

 

 

4,344

 

 

 

4,088

 

 

 

3,464

 

 

 

3,420

 

 

 

2,967

 

 

 

6,884

 

Income tax expense

 

517

 

 

 

811

 

 

 

746

 

 

 

630

 

 

 

607

 

 

 

517

 

 

 

1,237

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

2,450

 

 

$

3,533

 

 

$

3,342

 

 

$

2,834

 

 

$

2,813

 

 

$

2,450

 

 

$

5,647

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common share data:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

$

0.35

 

 

$

0.51

 

 

$

0.48

 

 

$

0.40

 

 

$

0.40

 

 

$

0.35

 

 

$

0.80

 

Diluted earnings per common share

$

0.35

 

 

$

0.50

 

 

$

0.47

 

 

$

0.40

 

 

$

0.40

 

 

$

0.35

 

 

$

0.79

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average shares outstanding (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

6,933

 

 

 

6,945

 

 

 

6,968

 

 

 

7,075

 

 

 

7,035

 

 

 

6,933

 

 

 

7,055

 

Diluted:

 

7,008

 

 

 

7,021

 

 

 

7,033

 

 

 

7,149

 

 

 

7,100

 

 

 

7,008

 

 

 

7,116

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


SB FINANCIAL GROUP, INC.

CONSOLIDATED FINANCIAL HIGHLIGHTS - (Unaudited)

($ in thousands, except per share & ratios)

 

At and for the Three Months Ended

 

Six Months Ended

 

 

March

 

December

 

September

 

June

 

March

 

June

 

June

SUMMARY OF OPERATIONS

 

 

2023

 

 

 

2022

 

 

 

2022

 

 

 

2022

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Net interest income

 

$

10,324

 

 

$

10,900

 

 

$

10,430

 

 

$

9,593

 

 

$

8,477

 

 

$

10,324

 

 

$

18,070

 

Tax-equivalent adjustment

 

 

43

 

 

 

41

 

 

 

38

 

 

 

33

 

 

 

29

 

 

 

43

 

 

 

62

 

Tax-equivalent net interest income

 

 

10,367

 

 

 

10,941

 

 

 

10,468

 

 

 

9,626

 

 

 

8,506

 

 

 

10,367

 

 

 

18,132

 

Provision for credit loss

 

 

250

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Noninterest income

 

 

3,666

 

 

 

3,713

 

 

 

4,043

 

 

 

4,673

 

 

 

5,802

 

 

 

3,666

 

 

 

10,475

 

Total operating revenue

 

 

13,990

 

 

 

14,613

 

 

 

14,473

 

 

 

14,266

 

 

 

14,279

 

 

 

13,990

 

 

 

28,545

 

Noninterest expense

 

 

10,773

 

 

 

10,269

 

 

 

10,384

 

 

 

10,802

 

 

 

10,859

 

 

 

10,773

 

 

 

21,661

 

Pre-tax pre-provision income

 

 

3,217

 

 

 

4,344

 

 

 

4,088

 

 

 

3,464

 

 

 

3,420

 

 

 

3,217

 

 

 

6,884

 

Pretax income

 

 

2,967

 

 

 

4,344

 

 

 

4,088

 

 

 

3,464

 

 

 

3,420

 

 

 

3,217

 

 

 

6,884

 

Net income

 

 

2,450

 

 

 

3,533

 

 

 

3,342

 

 

 

2,834

 

 

 

2,813

 

 

 

2,450

 

 

 

5,647

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PER SHARE INFORMATION:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share (EPS)

 

 

0.35

 

 

 

0.51

 

 

 

0.48

 

 

 

0.40

 

 

 

0.40

 

 

 

0.35

 

 

 

0.80

 

Diluted earnings per share

 

 

0.35

 

 

 

0.50

 

 

 

0.47

 

 

 

0.40

 

 

 

0.40

 

 

 

0.35

 

 

 

0.79

 

Common dividends

 

 

0.125

 

 

 

0.125

 

 

 

0.120

 

 

 

0.120

 

 

 

0.115

 

 

 

0.125

 

 

 

0.235

 

Book value per common share

 

 

17.37

 

 

 

17.08

 

 

 

16.49

 

 

 

17.75

 

 

 

18.65

 

 

 

17.37

 

 

 

17.75

 

Tangible book value per common share (TBV)

 

 

13.93

 

 

 

13.65

 

 

 

13.07

 

 

 

14.36

 

 

 

15.31

 

 

 

13.93

 

 

 

14.36

 

Market price per common share

 

 

14.16

 

 

 

16.95

 

 

 

16.85

 

 

 

17.26

 

 

 

19.91

 

 

 

14.16

 

 

 

17.26

 

Market price to TBV

 

 

101.7

%

 

 

124.2

%

 

 

128.9

%

 

 

120.2

%

 

 

130.1

%

 

 

101.7

%

 

 

120.2

%

Market price to trailing 12 month EPS

 

 

8.2

 

 

 

9.6

 

 

 

9.6

 

 

 

9.3

 

 

 

10.0

 

 

 

8.2

 

 

 

9.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PERFORMANCE RATIOS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (ROAA)

 

 

0.73

%

 

 

1.08

%

 

 

1.03

%

 

 

0.87

%

 

 

0.83

%

 

 

0.73

%

 

 

0.85

%

Pre-tax pre-provision ROAA

 

 

0.96

%

 

 

1.32

%

 

 

1.26

%

 

 

1.06

%

 

 

1.01

%

 

 

1.04

%

 

 

1.11

%

Return on average equity

 

 

8.37

%

 

 

12.17

%

 

 

10.89

%

 

 

8.89

%

 

 

8.08

%

 

 

8.37

%

 

 

8.46

%

Return on average tangible equity

 

 

10.50

%

 

 

15.30

%

 

 

13.51

%

 

 

10.93

%

 

 

9.75

%

 

 

10.51

%

 

 

10.30

%

Efficiency ratio

 

 

76.85

%

 

 

70.16

%

 

 

71.63

%

 

 

75.60

%

 

 

75.93

%

 

 

76.85

%

 

 

75.76

%

Earning asset yield

 

 

4.49

%

 

 

4.27

%

 

 

3.89

%

 

 

3.45

%

 

 

2.96

%

 

 

4.49

%

 

 

3.20

%

Cost of interest bearing liabilities

 

 

1.46

%

 

 

0.90

%

 

 

0.58

%

 

 

0.39

%

 

 

0.39

%

 

 

1.46

%

 

 

0.38

%

Net interest margin

 

 

3.35

%

 

 

3.60

%

 

 

3.45

%

 

 

3.15

%

 

 

2.67

%

 

 

3.36

%

 

 

2.91

%

Tax equivalent effect

 

 

0.02

%

 

 

0.01

%

 

 

0.01

%

 

 

0.01

%

 

 

0.01

%

 

 

0.01

%

 

 

0.01

%

Net interest margin, tax equivalent

 

 

3.37

%

 

 

3.61

%

 

 

3.46

%

 

 

3.16

%

 

 

2.68

%

 

 

3.37

%

 

 

2.92

%

Non interest income/Average assets

 

 

1.10

%

 

 

1.13

%

 

 

1.24

%

 

 

1.43

%

 

 

1.72

%

 

 

1.10

%

 

 

1.58

%

Non interest expense/Average assets

 

 

3.23

%

 

 

3.13

%

 

 

3.19

%

 

 

3.31

%

 

 

3.22

%

 

 

3.23

%

 

 

3.26

%

Net noninterest expense/Average assets

 

 

-2.13

%

 

 

-2.00

%

 

 

-1.95

%

 

 

-1.88

%

 

 

-1.50

%

 

 

-2.13

%

 

 

-1.68

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSET QUALITY RATIOS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross charge-offs

 

 

69

 

 

 

7

 

 

 

9

 

 

 

9

 

 

 

9

 

 

 

69

 

 

 

18

 

Recoveries

 

 

8

 

 

 

1

 

 

 

32

 

 

 

6

 

 

 

8

 

 

 

8

 

 

 

14

 

Net charge-offs

 

 

61

 

 

 

6

 

 

 

(23

)

 

 

3

 

 

 

1

 

 

 

61

 

 

 

4

 

Nonaccruing loans/Total loans

 

 

0.35

%

 

 

0.38

%

 

 

0.40

%

 

 

0.45

%

 

 

0.50

%

 

 

0.35

%

 

 

0.45

%

Nonperforming loans/Total loans

 

 

0.41

%

 

 

0.45

%

 

 

0.48

%

 

 

0.52

%

 

 

0.59

%

 

 

0.41

%

 

 

0.52

%

Nonperforming assets/Loans & OREO

 

 

0.48

%

 

 

0.53

%

 

 

0.56

%

 

 

0.60

%

 

 

0.66

%

 

 

0.48

%

 

 

0.60

%

Nonperforming assets/Total assets

 

 

0.35

%

 

 

0.38

%

 

 

0.40

%

 

 

0.42

%

 

 

0.42

%

 

 

0.35

%

 

 

0.42

%

Allowance for credit loss/Nonperforming loans

 

 

382.42

%

 

 

318.68

%

 

 

313.26

%

 

 

294.83

%

 

 

273.08

%

 

 

382.42

%

 

 

294.83

%

Allowance for credit loss/Total loans

 

 

1.58

%

 

 

1.44

%

 

 

1.49

%

 

 

1.54

%

 

 

1.62

%

 

 

1.58

%

 

 

1.54

%

Net loan charge-offs/Average loans (ann.)

 

 

0.03

%

 

 

0.00

%

 

 

(0.01

%)

 

 

0.00

%

 

 

0.00

%

 

 

0.03

%

 

 

0.00

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CAPITAL & LIQUIDITY RATIOS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans/ Deposits

 

 

87.94

%

 

 

88.53

%

 

 

85.21

%

 

 

83.56

%

 

 

74.75

%

 

 

87.94

%

 

 

83.56

%

Equity/ Assets

 

 

8.93

%

 

 

8.87

%