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KS Bancorp, Inc. (KSBI) Announces Third Quarter 2021 Financial Results and Cash Dividend

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SMITHFIELD, N.C., Oct. 21, 2021 (GLOBE NEWSWIRE) -- KS Bancorp, Inc. (the “Company”) (OTC Pink: KSBI), parent company of KS Bank, Inc. (the “Bank”), announced unaudited results for the third quarter of 2021.

The Company reported net income of $1.7 million or $1.52 per diluted share, for the three months ended September 30, 2021, an increase of 47.16% compared to net income of $1.1 million, or $1.03 per diluted share for the three months ended September 30, 2020. For the nine months ended September 30, 2021, the Company reported net income of $4.7 million, or $4.21 per diluted share compared to $3.0 million, or $2.74 per diluted share for the nine months ended September 30, 2020.

Net interest income before the provision for loan losses for the three months ended September 30, 2021, was $4.7 million as compared to $3.8 million for the comparable period in 2020. Noninterest income for the three months ended September 30, 2021 was $758,000, compared to $745,000 for the comparable period ended September 30, 2020. Noninterest expense was $3.2 million for the three months ended September 30, 2021, as compared $3.0 million in the comparable period in 2020. The Company recorded a provision for loan losses of $123,000 during the third quarter 2021, compared to $45,000 in the third quarter of 2020.

For the nine months ended September 30, 2021, net interest income before the provision for loan losses was $13.3 million, compared to $10.9 million for the nine months ended September 30, 2020. Noninterest income remain stable at $2.1 million for the nine months ended September 30, 2021 and 2020, respectfully. For the nine months ended September 30, 2021, noninterest income was $9.2 million compared to $9.0 million for the same period in 2020.

The Company’s unaudited consolidated total assets increased $73.3 million, to $559.1 million at September 30, 2021, compared to $485.8 million at December 31, 2020. Net loan balances decreased by $19.8 million, to $348.8 million at September 30, 2021, compared to $368.6 million at December 31, 2020. The decrease in loans was primarily due to forgiveness of payroll protection plan loans (PPP). The first round PPP loans have been completely forgiven at September 30, 2021. The second round PPP loan balance was $2.7 million at September 30, 2021. The Company’s investment securities totaled $80.0 million at September 30, 2021, compared to $71.7 million at December 31, 2020. Total deposits increased $73.4 million or 18.2% to $475.9 million at September 30, 2021, compared to $402.5 million at December 31, 2020. For the nine months ended September 30, 2021, there was a $75.7 million increase in core deposits. Total stockholders’ equity increased $3.6 million or 11.33% from $32.0 million at December 31, 2020 to $35.6 million at September 30, 2021.

Nonperforming assets consisted of $1.3 million in nonaccrual loans at September 30, 2021, representing less than 0.50% of the Company’s total assets. The Company had $621,000 foreclosed real estate owned at September 30, 2021. The allowance for loan losses at September 30, 2021 totaled $5.0 million, or 1.42% of total loans.

Commenting on the third quarter results, Harold Keen, President and CEO of the Company and the Bank, stated, “One of the core values we live by at KS Bank is to create win-wins for customers and the bank. After eighteen months of the payroll protection loans, our team successfully helped local businesses keep their employees working, by facilitating over $38.0 million in loans. Over 95% of those have been completely forgiven, and the remaining loans are near the end of documentation for forgiveness. Service given to existing customers and to many new customers who were having trouble at their now former bank, just affirms a win-win to all. There has been record growth in many areas of the Bank for the first nine months of 2021.”

In addition, the Company announced today that its Board of Directors has declared a quarterly dividend of $0.16 per share for stockholders of record as of October 29, 2021 with payment to be made on November 8, 2021.

KS Bank continues to be well-capitalized according to regulatory standards with total risk-based capital of 13.68%, tier 1 risk- based capital of 12.43%, common equity tier 1 risk- based capital of 12.43%, and a tier 1 leverage ratio of 8.46% at September 30, 2021. The minimum levels to be considered well capitalized for each of these ratios are 10.0%, 8.0%, 6.5%, and 5.0%, respectively.

KS Bancorp, Inc. is a Smithfield, North Carolina-based single bank holding company. KS Bank, Inc., a state-chartered savings bank, is KS Bancorp’s sole subsidiary. The Bank is a full service community bank serving the citizens of eastern North Carolina since 1924. The Bank offers a broad range of personal and business banking products and services, mortgage products and trust services. There are nine full service branches located in Kenly, Selma, Clayton, Garner, Goldsboro, Wilson, Wendell, Smithfield, and Four Oaks, North Carolina. In addition, KS Trust Services has a presence in Waynesville and Wilmington, NC. For more information, visit www.ksbankinc.com.

This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate” and “believe,” variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. The Company undertakes no obligation to update any forward-looking statements.

Contact: Harold T. Keen

Regina J Smith

President and Chief Executive Officer

Chief Financial Officer

(919) 938-3101

(919) 938-3101


KS Bancorp, Inc. and Subsidiary

Consolidated Statements of Financial Condition

September 30, 2021

December 31,

(unaudited)

2020*

(Dollars in thousands)

ASSETS

Cash and due from banks:

Interest-earning

$

107,437

$

24,720

Noninterest-earning

3,150

3,128

Time Deposit

2,600

100

Investment securities available for sale, at fair value

79,972

71,714

Federal Home Loan Bank stock, at cost

1,443

1,851

Presold mortgages in process of settlement

-

-

Loans

353,787

373,237

Less allowance for loan losses

(5,017

)

(4,644

)

Net loans

348,770

368,593

Accrued interest receivable

1,685

1,934

Foreclosed assets, net

621

621

Property and equipment, net

8,939

8,709

Other assets

4,541

4,458

Total assets

$

559,158

$

485,828

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities

Deposits

$

475,946

$

402,523

Long-term borrowings

43,248

47,248

Accrued interest payable

233

246

Accrued expenses and other liabilities

4,082

3,790

Total liabilities

523,509

453,807

Stockholder's Equity:

Common stock, no par value, authorized 20,000,000 shares;

1,107,776 shares issued and outstanding at September 30, 2021 and December 31, 2020

1,359

1,359

Retained earnings, substantially restricted

33,440

29,220

Accumulated other comprehensive loss

850

1,442

Total stockholders' equity

35,649

32,021

Total liabilities and stockholders' equity

$

559,158

$

485,828

* Derived from audited financial statements


KS Bancorp, Inc and Subsidiary

Consolidated Statements of Income (Unaudited)

Three Months Ended

Nine Months Ended

30-Sep

30-Sep

2021

2020

2021

2020

(In thousands, except per share data)

Interest and dividend income:

Loans

$

4,744

$

4,280

13,691

12,658

Investment securities

Taxable

272

269

786

899

Tax-exempt

155

57

393

138

Dividends

10

21

49

66

Interest-bearing deposits

27

4

48

18

Total interest and dividend income

5,208

4,631

14,967

13,779

Interest expense:

Deposits

249

521

799

1,858

Borrowings

276

314

871

1,026

Total interest expense

525

835

1,670

2,884

Net interest income

4,683

3,796

13,297

10,895

Provision for loan losses

123

45

369

160

Net interest income after

provision for loan losses

4,560

3,751

12,928

10,735

Noninterest income:

Service charges on deposit accounts

281

352

843

1,020

Fees from presold mortgages

5

51

54

85

Gain (Loss) on sale of investments

-

4

4

Other income

472

338

1,244

1,025

Total noninterest income

758

745

2,141

2,134

Noninterest expenses:

Compensation and benefits

1,935

1,838

5,634

5,433

Occupancy and equipment

394

347

1,122

1,084

Data processing & outside service fees

241

246

702

700

Advertising

22

17

48

60

Other

592

587

1,644

1,722

Total noninterest expenses

3,184

3,035

9,150

8,999

Income before income taxes

2,134

1,461

5,919

3,870

Income tax

449

316

1,256

832

Net income

$

1,685

$

1,145

$

4,663

$

3,038

Basic and Diluted earnings per share

$

1.52

$

1.03

$

4.21

$

2.74


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