Highlights:
- Net Income:
$24.3 million for the nine months endedMarch 31, 2023 - Total Assets:
$2.7 billion atMarch 31, 2023 - Return on Average Assets: 1.26% for the nine months ended
March 31, 2023 - Return on Average Equity: 19.51% for the nine months ended
March 31, 2023
As a result, for the quarter ending
Lastly, I am proud to report that on
Total consolidated assets for the Company were
Selected highlights for the three and nine months ended
Net Interest Income and Margin
- Net interest income increased
$1.1 million to$15.2 million for the three months endedMarch 31, 2023 from$14.1 million for the three months endedMarch 31, 2022 . Net interest income increased$4.1 million to$47.0 million for the nine months endedMarch 31, 2023 from$42.9 million for the nine months endedMarch 31, 2022 . The increase in net interest income was the result of growth in the average balance of interest-earning assets, which increased$166.8 million and$227.0 million when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively, and increases in interest rates on interest-earning assets, which increased 89 and 52 basis points when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively. The increase in net interest income was offset by increases in the average balance of interest-bearing liabilities, which increased$180.9 million and$237.6 million when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively, and increases in rates paid on interest-bearing liabilities, which increased 96 and 60 basis points when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively.
Average loan balances increased$245.3 million and$231.9 million and the yield on loans increased 59 and 13 basis points when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively. The increase in yield on loans for the nine months endedMarch 31, 2023 , was partially offset due to the fee income recognized on Paycheck Protection Program (“PPP”) loans for the nine months endedMarch 31, 2022 . Excluding the PPP loan fees, loan yields increased 46 basis points when comparing the nine months endedMarch 31, 2023 and 2022. Average securities decreased$15.1 million and increased$73.1 million and the yield on such securities increased 24 and 55 basis points when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively. Average interest-bearing bank balances and federal funds decreased$66.0 million and$80.2 million and the yield increased 509 and 381 basis points when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively.
The cost of NOW deposits increased 111 and 69 basis points, the cost of certificates of deposit increased 132 and 94 basis points, and the cost of savings and money market deposits increased 6 and 1 basis points when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively. The increase in the cost of interest-bearing liabilities was also due to growth in the average balance of interest-bearing liabilities of$180.9 million and$237.6 million , most notably due to an increase in NOW deposits of$129.6 million and$139.1 million , an increase in average borrowings of$53.3 million and$50.7 million , and an increase in average certificates of deposits of$16.5 million and$26.4 million , when comparing the three and nine months endedMarch 31, 2023 and 2022, respectively. Yields on interest-earning assets and costs of interest-bearing deposits increased for the three and nine months endedMarch 31, 2023 , as theFederal Reserve Board raised interest rates throughout the calendar year 2022 and in the first quarter of calendar year 2023.
- Net interest rate spread and margin both decreased when comparing the nine months ended
March 31, 2023 and 2022. Net interest rate spread decreased 7 and 8 basis points to 2.31% and 2.43% for the three and nine months endedMarch 31, 2023 compared to 2.38% and 2.51% for the three and nine months endedMarch 31, 2022 , respectively. Net interest margin increased 2 basis points to 2.43%, for the three months endedMarch 31, 2023 compared to 2.41% for the three months endedMarch 31, 2022 . Net interest margin decreased 1 basis point to 2.53%, for the nine months endedMarch 31, 2023 compared to 2.54% for the nine months endedMarch 31, 2022 . The decrease during the current quarter was due to the higher interest rate environment, which resulted in higher rates paid on deposits, resulting in higher interest expense. This was partially offset by increases in interest income on loans and securities, as they reprice at higher yields and the interest rates earned on new balances were higher than the historic low levels. - Net interest income on a taxable-equivalent basis includes the additional amount of interest income that would have been earned if the Company’s investment in tax-exempt securities and loans had been subject to federal and
New York State income taxes yielding the same after-tax income. Tax equivalent net interest margin was 2.66% and 2.56% for the three months endedMarch 31, 2023 and 2022, respectively, and was 2.73% and 2.69% for the nine months endedMarch 31, 2023 and 2022, respectively.
Asset Quality and Loan Loss Provision
- Provision for loan losses amounted to a benefit of
$944,000 and a charge of$163,000 for the three months endedMarch 31, 2023 and 2022, respectively, and amounted to a benefit of$1.2 million and a charge of$2.4 million for the nine months endedMarch 31, 2023 and 2022, respectively. The benefit for the three and nine months endedMarch 31, 2023 was due to a decrease in the balance and reserve percentage on loans adversely classified, as loans were upgraded due to improvements in credit quality and loans were paid off during the quarter. This was partially offset by the growth in gross loans and increases in qualitative factors in the current quarter related to the economic environment as inflation continues to be high and the impact that higher interest rates have on borrowers. Loans classified as substandard or special mention totaled$36.6 million atMarch 31, 2023 and$52.1 million atJune 30, 2022 , a decrease of$15.5 million . Reserves on loans classified as substandard or special mention totaled$4.8 million atMarch 31, 2023 compared to$9.6 million atJune 30, 2022 , a decrease of$4.8 million . There were no loans classified as doubtful or loss atMarch 31, 2023 orJune 30, 2022 . Allowance for loan losses to total loans receivable was 1.50% atMarch 31, 2023 compared to 1.82% atJune 30, 2022 . - Net charge-offs amounted to
$190,000 and$108,000 for the three months endedMarch 31, 2023 and 2022, respectively, an increase of$82,000 . Net charge-offs totaled$407,000 and$360,000 for the nine months endedMarch 31, 2023 and 2022, respectively. There were no significant charge offs in any loan segment during the three and nine months endedMarch 31, 2023 . - Nonperforming loans amounted to
$4.7 million and$6.3 million atMarch 31, 2023 andJune 30, 2022 , respectively. The decrease in nonperforming loans during the period was primarily due to$1.3 million in loan repayments,$134,000 in loans returning to performing status, and$508,000 in charge-offs or transfers to foreclosed, partially offset by$293,000 of loans placed into nonperforming status. AtMarch 31, 2023 nonperforming assets were 0.19% of total assets compared to 0.25% atJune 30, 2022 . Nonperforming loans were 0.34% and 0.51% of net loans atMarch 31, 2023 andJune 30, 2022 , respectively.
Noninterest Income and Noninterest Expense
- Noninterest income increased
$154,000 , or 5.3%, to$3.1 million for the three months endedMarch 31, 2023 compared to$2.9 million for the three months endedMarch 31, 2022 . Noninterest income decreased$20,000 , or 0.2%, to$9.1 million for the nine months endedMarch 31, 2023 compared to$9.1 million for the nine months endedMarch 31, 2022 . The decrease for the nine month period was primarily due to a decrease in investment service income and a net loss on sale of available for sale securities. This was partially offset by an increase in debit card fees and service charges on deposit accounts resulting from continued growth in the number of checking accounts with debit cards and the number of deposit accounts, and the income from bank owned life insurance. - Noninterest expense increased
$1.5 million or 18.5%, to$9.9 million for the three months endedMarch 31, 2023 compared to$8.3 million for the three months endedMarch 31, 2022 . Noninterest expense increased$4.0 million , or 16.2%, to$28.6 million for the nine months endedMarch 31, 2023 , compared to$24.6 million for the nine months endedMarch 31, 2022 . The increase during the three and nine months endedMarch 31, 2023 was primarily due increases in salaries and employee benefits expense due to new positions created during the period to support the Company’s growth. The increase during the nine months endedMarch 31, 2023 was also due to a non-recurring litigation reserve expense of$1.2 million .
Income Taxes
- Provision for income taxes reflects the expected tax associated with the pre-tax income generated for the given year and certain regulatory requirements. The effective tax rate was 13.7% and 15.0% for the three and nine months ended
March 31, 2023 , respectively, and 15.6% and 15.2% for the three and nine months endedMarch 31, 2022 , respectively. The statutory tax rate is impacted by the benefits derived from tax-exempt bond and loan income, the Company’s real estate investment trust subsidiary income, income received on the bank owned life insurance, as well as the tax benefits derived from premiums paid to the Company’s pooled captive insurance subsidiary to arrive at the effective tax rate. The decrease in the current quarter’s effective tax rate was the result of an increase in tax-exempt income proportional to total income.
Balance Sheet Summary
- Total assets of the Company were
$2.7 billion atMarch 31, 2023 and$2.6 billion atJune 30, 2022 , an increase of$157.4 million , or 6.1%. - Cash and due from banks for the Company were
$178.3 million atMarch 31, 2023 and$69.0 million atJune 30, 2022 , an increase of$109.3 million , or 158.4%. The Company increased the overall cash position to bolster the current liquidity position in response to the current turmoil in the banking sector. - Securities available-for-sale and held-to-maturity decreased
$116.1 million , or 9.9%, to$1.1 billion atMarch 31, 2023 as compared to$1.2 billion atJune 30, 2022 . The decrease was the result of utilizing maturing investments to fund loan growth during the period and due to the increase in unrealized loss on available-for-sale securities of$2.3 million . Securities purchases totaled$146.5 million during the nine months endedMarch 31, 2023 and consisted primarily of$144.5 million of state and political subdivision securities. Principal pay-downs and maturities during the nine months endedMarch 31, 2023 amounted to$256.4 million , primarily consisting of$229.8 million of state and political subdivision securities, and$24.2 million of mortgage-backed securities. - Net loans receivable increased
$159.0 million , or 12.9%, to$1.4 billion atMarch 31, 2023 from$1.2 billion atJune 30, 2022 . The loan growth experienced during the nine months consisted primarily of$107.1 million in commercial real estate loans,$14.0 million in residential real estate loans,$2.3 million in residential construction and land loans,$3.4 million in multi-family loans, and$25.1 million in commercial construction loans. - Deposits totaled
$2.5 billion atMarch 31, 2023 and$2.2 billion atJune 30, 2022 , an increase of$259.7 million , or 11.7%. NOW deposits increased$265.2 million , or 17.9%, and certificates of deposits increased$80.6 million , or 197.5% when comparingMarch 31, 2023 andJune 30, 2022 . Included within certificates of deposits atMarch 31, 2023 andJune 30, 2022 were$74.6 million and$7.2 million in brokered certificates of deposits, respectively, an increase of$67.4 million . The additional brokered deposits were obtained in an abundance of caution to support the Company’s overall liquidity and cash position, in response to the current turmoil in the banking sector. Money market deposits decreased$30.5 million , or 19.4%, savings deposits decreased$32.4 million , or 9.4%, and noninterest-bearing deposits decreased$23.2 million , or 12.3% when comparingMarch 31, 2023 andJune 30, 2022 . - Borrowings for the Company amounted to
$49.4 million atMarch 31, 2023 compared to$173.0 million atJune 30, 2022 , a decrease of$123.6 million . AtMarch 31, 2023 , borrowings consisted of$49.4 million of Fixed-to-Floating Rate Subordinated Notes. - Shareholders’ equity increased to
$178.7 million atMarch 31, 2023 from$157.7 million atJune 30, 2022 , resulting primarily from net income of$24.3 million , partially offset by dividends declared and paid of$1.6 million and an increase in accumulated other comprehensive loss of$1.7 million . As ofMarch 31, 2023 , capital levels remain strong forThe Bank of Greene County and its subsidiaryGreene County Commercial Bank .
This press release contains statements about future events that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, general economic conditions, financial and regulatory changes, changes in interest rates, regulatory considerations, competition, technological developments, retention and recruitment of qualified personnel, and market acceptance of the Company’s pricing, products and services.
In addition to presenting information in conformity with accounting principles generally accepted in
Consolidated Statements of Income, and Selected Financial Ratios (Unaudited)
At or for the Three Months | At or for the Nine Months | |||||||||||
Ended | Ended | |||||||||||
Dollars in thousands, except share and per share data | 2023 | 2022 | 2023 | 2022 | ||||||||
Interest income | ||||||||||||
Interest expense | 6,707 | 1,218 | 14,118 | 3,790 | ||||||||
Net interest income | 15,226 | 14,087 | 46,983 | 42,939 | ||||||||
Provision for loan losses | (944) | 163 | (1,199) | 2,431 | ||||||||
Noninterest income | 3,059 | 2,905 | 9,052 | 9,072 | ||||||||
Noninterest expense | 9,856 | 8,314 | 28,604 | 24,612 | ||||||||
Income before taxes | 9,373 | 8,515 | 28,630 | 24,968 | ||||||||
Tax provision | 1,282 | 1,327 | 4,305 | 3,789 | ||||||||
Net income | ||||||||||||
Basic and diluted EPS | ||||||||||||
Weighted average shares outstanding | 17,026,828 | 17,026,828 | 17,026,828 | 17,026,828 | ||||||||
Dividends declared per share 4 | ||||||||||||
Selected Financial Ratios | ||||||||||||
Return on average assets1 | 1.25% | 1.19% | 1.26% | 1.21% | ||||||||
Return on average equity1 | 18.61% | 18.10% | 19.51% | 18.09% | ||||||||
Net interest rate spread1 | 2.31% | 2.38% | 2.43% | 2.51% | ||||||||
Net interest margin1 | 2.43% | 2.41% | 2.53% | 2.54% | ||||||||
Fully taxable-equivalent net interest margin2 | 2.66% | 2.56% | 2.73% | 2.69% | ||||||||
Efficiency ratio3 | 53.90% | 48.93% | 51.05% | 47.32% | ||||||||
Non-performing assets to total assets | 0.19% | 0.16% | ||||||||||
Non-performing loans to net loans | 0.34% | 0.34% | ||||||||||
Allowance for loan losses to non-performing loans | 450.87% | 562.46% | ||||||||||
Allowance for loan losses to total loans | 1.50% | 1.88% | ||||||||||
Shareholders’ equity to total assets | 6.55% | 6.22% | ||||||||||
Dividend payout ratio4 | 14.69% | 15.73% | ||||||||||
Actual dividends paid to net income5 | 6.76% | 7.21% | ||||||||||
Book value per share |
1 Ratios are annualized when necessary.
2 Interest income calculated on a taxable-equivalent basis includes the additional interest income that would have been earned if the Company’s investment in tax-exempt securities and loans had been subject to federal and
For the three months ended | For the nine months ended | |||||||||||
(Dollars in thousands) | 2023 | 2022 | 2023 | 2022 | ||||||||
Net interest income (GAAP) | ||||||||||||
Tax-equivalent adjustment | 1,400 | 865 | 3,808 | 2,440 | ||||||||
Net interest income (fully taxable-equivalent basis) | ||||||||||||
Average interest-earning assets | ||||||||||||
Net interest margin (fully taxable-equivalent basis) | 2.66% | 2.56% | 2.73% | 2.69% |
3 The efficiency ratio has been calculated as noninterest expense divided by the sum of net interest income and noninterest income.
4 The dividend payout ratio has been calculated based on the dividends declared per share divided by basic earnings per share. No adjustments have been made to account for dividends waived by
5 Dividends declared divided by net income. The MHC waived its right to receive dividends declared during the three months
The above information is preliminary and based on the Company’s data available at the time of presentation.
Consolidated Statements of Financial Condition (Unaudited)
At | At | ||||||
(Dollars In thousands, except share data) | |||||||
Assets | |||||||
Total cash and cash equivalents | |||||||
Long term certificate of deposit | 4,581 | 4,107 | |||||
Securities- available for sale, at fair value | 316,864 | 408,062 | |||||
Securities- held to maturity, at amortized cost | 736,983 | 761,852 | |||||
Equity securities, at fair value | 295 | 273 | |||||
1,461 | 6,803 | ||||||
Gross loans receivable | 1,409,447 | 1,251,987 | |||||
Less: Allowance for loan losses | (21,155) | (22,761) | |||||
Unearned origination fees and costs, net | 29 | 129 | |||||
Net loans receivable | 1,388,321 | 1,229,355 | |||||
Premises and equipment | 14,532 | 14,362 | |||||
Bank owned life insurance | 54,714 | 53,695 | |||||
Accrued interest receivable | 13,992 | 8,917 | |||||
Foreclosed real estate | 462 | 68 | |||||
Prepaid expenses and other assets | 18,574 | 15,237 | |||||
Total assets | |||||||
Liabilities and shareholders’ equity | |||||||
Noninterest bearing deposits | |||||||
Interest bearing deposits | 2,307,791 | 2,024,907 | |||||
Total deposits | 2,472,323 | 2,212,604 | |||||
Borrowings from FHLB, short-term | - | 123,700 | |||||
Subordinated notes payable | 49,449 | 49,310 | |||||
Accrued expenses and other liabilities | 28,651 | 28,412 | |||||
Total liabilities | 2,550,423 | 2,414,026 | |||||
Total shareholders’ equity | 178,678 | 157,714 | |||||
Total liabilities and shareholders’ equity | |||||||
Common shares outstanding | 17,026,828 | 17,026,828 | |||||
195,852 | 195,852 |
The above information is preliminary and based on the Company’s data available at the time of presentation.
For Further Information Contact:
President & CEO
(518) 943-2600
donaldg@tbogc.com
SEVP, COO & CFO
(518) 943-2600
michellep@tbogc.com
Source:
2023 GlobeNewswire, Inc., source