Elmira Savings Bank Reports Third Quarter Earnings

ELMIRA, New York, Oct. 20, 2021 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

• Net income was $1,511,000 and $4,117,000 for the three and nine months ended September 30, 2021 compared to $948,000 and $2,875,000 for the same periods in 2020.
  
  

• Diluted earnings per share were $.43 per share and $1.17 per share for the three and nine months ended September 30, 2021 compared to $.27 per share and $.82 per share for the same periods in 2020.
  
  

• Return on average assets was .92% and .85% for the three and nine months ended September 30, 2021 compared to .55% and .60% for the three and nine months ended September 30, 2020.
  
  

• Return on average equity was 9.49% and 8.83% for the three and nine months ended September 30, 2021 compared to 6.27% and 6.44% for the same periods in 2020.
  

"We are pleased with the improvement in core earnings and asset quality," said Thomas M Carr, President and CEO. Carr continued, “We are focused on serving our customers and anticipate a successful transition to Community Bank, N.A. during the first quarter of 2022.”

Net Income

Net income totaled $4,117,000 for the nine months ended September 30, 2021, an increase of $1,242,000 or 43% from the $2,875,000 of net income recorded for the same period in 2020. This increase was the net result of an increase in noninterest income of $121,000, an increase in net interest income of $1,299,000, and a decrease in the provision for loan losses of $925,000, offset by an increase in noninterest expense of $590,000 and an increase in tax expense of $513,000.

Net income totaled $1,511,000 for the three months ended September 30, 2021, an increase of $563,000 or 59% from the $948,000 recorded for the same period in 2020. This increase was the net result of an increase in net interest income of $856,000 and a decrease in the provision for loan losses of $450,000, offset by an increase in noninterest expense of $152,000, a decrease in noninterest income of $364,000, and an increase in tax expense of $227,000.

Basic and diluted earnings per share for the nine months ended September 30, 2021 were both $1.17 per share compared to $.82 per share for both for the same period in 2020. Basic and diluted earnings per share for the three months ended September 30, 2021 were both $.43 per share compared to $.27 per share for both for the same period in 2020.

Net Interest Margin

The net interest margin for the nine months ended September 30, 2021 was 3.62% compared to 2.98% for the same period in 2020. The yield on average earning assets was 4.20% for the nine months ended September 30, 2021 compared to 4.13% for the same period in 2020. The average cost of interest-bearing liabilities was 0.62% for the nine months ended September 30, 2021 compared to 1.32% for the same period in 2020.

The net interest margin for the three months ended September 30, 2021 was 3.81% compared to 2.81% for the same period in 2020. The average yield on earning assets was 4.24% for the three months ended September 30, 2021 compared to 3.91% for the same period in 2020. The average cost of interest-bearing liabilities was 0.46% for the three months ended September 30, 2021 compared to 1.20% for the same period in 2020.

Assets

Total assets decreased $991,000 or 0.2% to $643.6 million at September 30, 2021 compared to $644.6 million at December 31, 2020. Loans, including loans held for sale, decreased 4.4% to $467.6 million at September 30, 2021 compared to December 31, 2020. The available-for-sale investment portfolio decreased $1.5 million from December 31, 2020 to September 30, 2021. Total cash and cash equivalents were $111.6 million at September 30, 2021, an increase of $22.4 million from December 31, 2020 when cash totaled $89.2 million.

Nonperforming Loans

Our nonperforming loans to total loans ratio was 0.70% at September 30, 2021 and 1.07% at December 31, 2020. Net loan charge-offs to average loans for the nine months ended September 30, 2021 was 0.08% compared to 0.06% for the nine months ended September 30, 2020. The allowance for loan losses was 1.21% of total loans at September 30, 2021 and 1.19% of total loans at December 31, 2020.

Liabilities

Deposits total $544.8 million at September 30, 2021, a decrease of $2.3 million or 0.4% from the December 31, 2020 total of $547.0 million. Borrowed funds totaled $24.0 million as of September 30, 2021, a decrease of $5.0 million from December 31, 2020 when borrowed funds totaled $29.0 million.

Shareholders’ Equity

Shareholders’ equity increased $2,635,000 to $63.4 million at September 30, 2021 compared to December 31, 2020. The current level of shareholders’ equity equates to a book value per share of $17.86 at September 30, 2021, compared to $17.23 at December 31, 2020. Dividends paid for common shareholders were $0.15 and $0.45 for the three and nine months ended September 30, 2021 and $0.15 and $0.53 for the three and nine months ended September 30, 2020.

Elmira Savings Bank, with $643.6 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with five offices in Chemung County, NY; three offices in Tompkins County, NY; two offices in Steuben County, NY; one office in Cayuga County, NY; one office in Schuyler County; and a loan center in Broome County, NY.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank’s regulatory reports.

ELMIRA SAVINGS BANK
CONSOLIDATED BALANCE SHEET
(unaudited)
(in thousands, except for share and per share data)		September 30,				December 31,
			2021				2020			% Change
ASSETS
Cash and due from banks		$	111,114			$	88,536			25.5	%
Federal funds sold and other short-term investments			492				651			-24.4	%
Total cash and cash equivalents			111,606				89,187			25.1	%
Securities available for sale, at fair value			4,631				6,125			-24.4	%
Securities held to maturity - fair value $6,448
at September 30, 2021, and $7,211 at December 31, 2020			6,219				6,597			-5.7	%
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost			8,220				9,054			-9.2	%
Loans held for sale			3,298				5,408			-39.0	%
Loans receivable			464,258				483,768			-4.0	%
Less: Allowance for loan losses			5,627				5,755			-2.2	%
Net loans			458,631				478,013			-4.1	%
Premises and equipment, net			15,704				15,876			-1.1	%
Bank-owned life insurance			15,807				15,410			2.6	%
Accrued interest receivable			1,391				1,564			-11.1	%
Goodwill			12,320				12,320			0.0	%
Other assets			5,769				5,033			14.6	%
Total assets		$	643,596			$	644,587			-0.2	%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits		$	544,763			$	547,021			-0.4	%
Borrowings			24,000				29,000			-17.2	%
Other liabilities			11,437				7,805			46.5	%
Total liabilities			580,200				583,826			-0.6	%
Shareholders' equity:
Preferred stock, $1 par value; $1,000 liquidation value per issued share; 5,000,000 shares authorized;
10,000 shares issued and none outstanding at September 30, 2021 and at December 31, 2020			9,700				9,700			0.0	%
Common stock, $1 par value; authorized 5,000,000 shares; 3,641,487 shares issued and 3,547,604 outstanding
at September 30, 2021 and 3,616,770 shares issued and 3,522,887 outstanding at December 31, 2020			3,641				3,617			0.7	%
Additional paid-in capital			54,376				54,255			0.2	%
Retained earnings			7,718				5,197			48.5	%
Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares
at September 30, 2021 and December 31, 2020			(12,202	)			(12,202	)		0.0	%
Accumulated other comprehensive income			113				144			-21.5	%
Total Elmira Savings Bank shareholders' equity			63,346				60,711			4.3	%
Noncontrolling interest			50				50			0.0	%
Total shareholders' equity			63,396				60,761			4.3	%
Total liabilities and shareholders' equity		$	643,596			$	644,587			-0.2	%

ELMIRA SAVINGS BANK
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
		Three Months Ended											Nine Months
		September 30,											Ended September 30,
(in thousands, except for per share data)			2021				2020			% Change				2021				2020			% Change
Interest and dividend income:
Interest and fees on loans		$	5,054			$	5,140			-1.7	%		$	15,127			$	16,213			-6.7	%
Interest and dividends on securities
Taxable			125				163			-23.3	%			398				553			-28.0	%
Non-taxable			66				72			-8.3	%			202				226			-10.6	%
Total interest and dividend income			5,245				5,375			-2.4	%			15,727				16,992			-7.4	%
Interest expense:
Interest on deposits			363				1,291			-71.9	%			1,632				4,050			-59.7	%
Interest on borrowings			174				232			-25.0	%			526				672			-21.7	%
Total interest expense			537				1,523			-64.7	%			2,158				4,722			-54.3	%
Net interest income			4,708				3,852			22.2	%			13,569				12,270			10.6	%
Provision for loan losses			-				450			-100.0	%			150				1,075			-86.0	%
Net interest income after provision for loan losses			4,708				3,402			38.4	%			13,419				11,195			19.9	%
Noninterest income:
Service fees			308				285			8.1	%			920				871			5.6	%
Gain on sale of loans held for sale			854				1,238			-31.0	%			2,708				2,757			-1.8	%
Other service fees			237				216			9.7	%			677				590			14.7	%
Earnings on bank-owned life insurance			107				103			3.9	%			307				298			3.0	%
Other			58				86			-32.6	%			224				199			12.6	%
Total noninterest income			1,564				1,928			-18.9	%			4,836				4,715			2.6	%
Noninterest expense:
Salaries and benefits			2,228				2,236			-0.4	%			6,687				6,450			3.7	%
Net occupancy			172				388			-55.7	%			1,175				1,217			-3.5	%
Equipment			384				408			-5.9	%			1,210				1,193			1.4	%
Marketing and public relations			254				202			25.7	%			662				525			26.1	%
Professional fees			490				143			242.7	%			794				458			73.4	%
Other			779				778			0.1	%			2,383				2,478			-3.8	%
Total noninterest expense			4,307				4,155			3.7	%			12,911				12,321			4.8	%
Income before income taxes			1,965				1,175			67.2	%			5,344				3,589			48.9	%
Income taxes			454				227			100.0	%			1,227				714			71.8	%
Net income			1,511				948			59.4	%			4,117				2,875			43.2	%
Less: Net income attributable to noncontrolling interest			-				-			-				-				-			-
Net income attributable to Elmira Savings Bank		$	1,511			$	948			59.4	%		$	4,117			$	2,875			43.2	%
Basic earnings per share		$	0.43			$	0.27			59.3	%		$	1.17			$	0.82			42.7	%
Diluted earnings per share		$	0.43			$	0.27			59.3	%		$	1.17			$	0.82			42.7	%
Weighted average shares outstanding - basic			3,522,400				3,509,421			0.4	%			3,518,775				3,506,646			0.3	%
Weighted average shares outstanding - diluted			3,523,526				3,509,421			0.4	%			3,519,663				3,507,728			0.3	%
Dividends per share		$	0.15			$	0.15			0.0	%		$	0.45			$	0.53			-15.1	%

ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
(Dollars in Thousands)	For the Three Months Ended
	September 30, 2021											September 30, 2020
ASSETS:		Average Balance				Interest			Average Rate				Average Balance				Interest			Average Rate
Loans	$	470,777			$	5,054			4.26	%		$	521,294			$	5,140			3.92	%
Short-term investments		674				-			0.04				1,257				-			0.05
Securities		19,434				191			3.91				23,170				235			4.08
Total interest-earning assets		490,885				5,245			4.24				545,721				5,375			3.91
Noninterest-earning assets		160,254											136,645
TOTAL ASSETS	$	651,139										$	682,366
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits	$	430,078			$	363			0.33			$	447,441			$	1,291			1.15
Borrowings		25,848				174			2.64				56,548				232			1.61
Total interest-bearing liabilities		455,926				537			0.46				503,989				1,523			1.20
Noninterest-bearing liabilities		132,024											118,276
Shareholders' equity		63,189											60,101
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	651,139										$	682,366
Interest rate spread									3.78	%										2.71	%
Net interest income/margin					$	4,708			3.81	%						$	3,852			2.81	%

ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
(Dollars in Thousands)	For the Nine Months Ended
	September 30, 2021											September 30, 2020
ASSETS:		Average Balance				Interest			Average Rate				Average Balance				Interest			Average Rate
Loans	$	477,894			$	15,127			4.21	%		$	520,481			$	16,213			4.14	%
Short-term investments		573				-			0.03				1,111				2			0.18
Securities		20,296				600			3.95				25,291				777			4.10
Total interest-earning assets		498,763				15,727			4.20				546,883				16,992			4.13
Noninterest-earning assets		152,323											96,310
TOTAL ASSETS	$	651,086										$	643,193
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits	$	434,307			$	1,632			0.50			$	433,423			$	4,050			1.25
Borrowings		26,256				526			2.64				44,008				672			2.01
Total interest-bearing liabilities		460,563				2,158			0.62				477,431				4,722			1.32
Noninterest-bearing liabilities		128,161											106,086
Shareholders' equity		62,362											59,676
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	651,086										$	643,193
Interest rate spread									3.58	%										2.81	%
Net interest income/margin					$	13,569			3.62	%						$	12,270			2.98	%

			Quarter Ended
(Dollars in Thousands, Except Per Share Data)				9/30/2021			6/30/2021			3/31/2021			12/31/2020			9/30/2020
Operating Data
	Net income		$	1,511		$	1,402		$	1,204		$	1,284		$	948
	Net interest income			4,708			4,340			4,521			4,310			3,852
	Provision for loan losses			-			-			150			375			450
	Net security gains			-			-			-			-			-
	Non-interest income, ex. Net security gains			1,564			1,347			1,925			2,504			1,928
	Non-interest expense			4,307			3,904			4,700			4,771			4,155
Performance Statistics
	Net interest margin			3.81	%		3.48	%		3.57	%		3.24	%		2.81	%
	Annualized return on average assets			0.92	%		0.86	%		0.75	%		0.78	%		0.55	%
	Annualized return on average equity			9.49	%		9.03	%		7.93	%		8.40	%		6.27	%
	Annualized net loan charge-offs to avg loans			0.14	%		0.06	%		0.03	%		0.03	%		0.04	%
	Net charge-offs			164			74			40			38			57
	Efficiency ratio			68.7	%		68.6	%		72.9	%		70.0	%		71.9	%
Per Share Data
	Basic earnings per share		$	0.43		$	0.40		$	0.34		$	0.37		$	0.27
	Diluted earnings per share			0.43			0.40			0.34			0.37			0.27
	Dividend declared per share			0.15			0.15			0.15			0.15			0.15
	Book value			17.86			17.57			17.34			17.23			17.01
	Common stock price:
		High		14.75			15.05			15.96			13.25			11.18
		Low		12.80			13.23			11.48			10.44			10.30
		Close		13.34			14.31			13.50			11.50			11.02
	Weighted average common shares:
		Basic		3,522			3,519			3,515			3,512			3,509
		Fully diluted		3,524			3,520			3,515			3,512			3,509
	End-of-period common shares:
		Issued		3,641			3,641			3,636			3,617			3,617
		Treasury		94			94			94			94			94
Financial Condition Data:
General
	Total assets		$	643,596		$	648,686		$	659,333		$	644,587		$	674,032
	Loans, net			458,631			465,271			476,383			478,013			504,946
	Intangibles			12,320			12,320			12,320			12,320			12,320
	Total deposits			544,763			551,245			562,893			547,021			551,350
		Noninterest-bearing		118,511			121,534			121,101			109,346			107,423
		Savings		95,299			93,351			87,228			82,573			79,492
		NOW		114,514			111,343			111,414			100,293			98,464
		Money Market		36,577			32,624			35,011			35,920			34,375
		Time deposits		179,862			192,393			208,139			218,889			231,596
		Total interest-bearing deposits		426,252			429,711			441,792			437,675			443,927
	Shareholders' equity			63,396			62,375			61,462			60,761			59,960
Asset Quality
	Non-performing assets		$	3,645		$	5,023		$	5,602		$	5,304		$	5,507
	Non-performing assets to total assets			0.57	%		0.77	%		0.85	%		0.82	%		0.82	%
	Allowance for loan losses			5,627			5,791			5,865			5,755			5,418
	Allowance for loan losses to total loans			1.21	%		1.23	%		1.22	%		1.19	%		1.06	%
	Allowance for loan losses to
		non-performing loans		175.95	%		116.12	%		108.63	%		112.67	%		104.11	%
	Non-performing loans to total loans			0.70	%		1.07	%		1.13	%		1.07	%		1.03	%
Capitalization
	Shareholders' equity to total assets			9.85	%		9.62	%		9.32	%		9.43	%		8.90	%

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