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Elmira Savings Bank Reports Third Quarter Earnings

ELMIRA, N.Y., Oct. 19, 2017 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

  • Net income was $1,215,000 and $3,402,000 for the three and nine months ended September 30, 2017 compared to $1,202,000 and $3,295,000 for the same periods in 2016.
  • Diluted earnings per share were $.30 per share and $.88 per share for the three and nine months ended September 30, 2017 compared to $.36 per share and $.96 per share for the same periods in 2016.
  • Return on average assets was .84% and .80% for the three and nine months ended September 30, 2017 compared to .84% and .78% for the same periods in 2016.
  • Return on average equity was 7.32% and 7.34% for the three and nine months ended September 30, 2017 compared to 8.54% and 7.89% for the same periods in 2016.

“We are pleased with the year-over-year improvement in earnings, highlighted by an increase in our net interest margin which has risen by 11 basis points year-to-year to 3.31% through 2017,” said Thomas M. Carr, President and CEO.

Net Income

Net income totaled $3,402,000 for the nine months ended September 30, 2017, an increase of $107,000 or 3% from the $3,295,000 of net income recorded for the same period in 2016. This increase was the net result of a decrease in noninterest expense of $345,000 and an increase in net interest income of $41,000, offset by a decrease in noninterest income of $266,000, an increase in the provision for loan losses of $3,000, and an increase in tax expense of $10,000.

Net income totaled $1,215,000 for the three months ended September 30, 2017, an increase of $13,000 or 1% from the $1,202,000 recorded for the same period in 2016. This increase was the net result of a decrease in noninterest expense of $216,000 and a decrease in tax expense of $84,000, offset by a decrease in noninterest income of $90,000, a decrease in net interest income of $164,000, and an increase in the provision for loan losses of $33,000.

Basic and diluted earnings per share for the nine months ended September 30, 2017 were $.89 per share and $.88 per share compared to $.96 per share for both for the same period in 2016. Basic and diluted earnings per share for the three months ended September 30, 2017 were both $.30 per share compared to $.36 per share for both for the same period in 2016.

Net Interest Margin

The net interest margin for the nine months ended September 30, 2017 was 3.31% compared to 3.20% for the same period in 2016. The yield on average earning assets was 4.12% for the nine months ended September 30, 2017 compared to 4.06% for the same period in 2016. The average cost of interest-bearing liabilities was .94% for the nine months ended September 30, 2017 compared to 1.01% for the same period in 2016.

The net interest margin for the three months ended September 30, 2017 was 3.27% compared to 3.24% for the same period in 2016. The average yield on earning assets was 4.09% for the three months ended September 30, 2017 compared to 4.04% for the same period in 2016. The average cost of interest-bearing liabilities was 0.96% for both the three months ended September 30, 2017 and 2016.

Assets

Total assets decreased $8.4 million or 1.5% to $565.0 million at September 30, 2017 compared to $573.5 million at December 31, 2016. Loans, including loans held for sale, decreased 2.1% to $449.8 million at September 30, 2017 compared to December 31, 2016. The available-for-sale investment portfolio decreased $6.4 million from December 31, 2016 to September 30, 2017.

Nonperforming Loans

Our nonperforming loans to total loans ratio has decreased to 0.84% at September 30, 2017 from 1.11% at December 31, 2016. Net loan charge-offs to average loans for the nine months ended September 30, 2017 of 0.03% decreased from 0.04% for the nine months ended September 30, 2016. The allowance for loan losses was 0.98% of total loans at September 30, 2017 and 0.94% of total loans at December 31, 2016.

Liabilities

Deposits total $454.8 million at September 30, 2017, a decrease of $14.7 million or 3.1%. The $14.7 million decrease consists of a $15.7 million decrease in time deposits, a $3.7 million decrease in money market accounts, and a $2.4 million decrease in savings accounts, partially offset by a $1.8 million increase in interest bearing transaction accounts and a $5.3 million increase in noninterest bearing accounts. Borrowed funds decreased by $5.0 million or 11.9%.

Shareholders’ Equity

Shareholders’ equity increased $9.9 million to $65.6 million at September 30, 2017 compared to December 31, 2016. The increase in shareholders’ equity includes the impact of the gross $9.5 million received from the private placement of 548,430 common shares in April 2017. The current level of shareholders’ equity equates to a book value per share of $16.84 at September 30, 2017, compared to $16.74 at December 31, 2016. Dividends paid to common shareholders were $0.23 and $0.70 for the three and nine months ended September 30, 2017 and were $0.23 and $0.69 for the three and nine months ended September 30, 2016.

Elmira Savings Bank, with $565.0 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with six 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, NY; 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,
2017 2016 % Change
ASSETS
Cash and due from banks $28,253 $24,195 16.8%
Federal funds sold and other short-term investments 97 99 -2.0%
Total cash and cash equivalents 28,350 24,294 16.7%
Securities available for sale, at fair value 26,182 32,581 -19.6%
Securities held to maturity - fair value $8,306
at September 30, 2017 and $8,679 at December 31, 2016 8,160 8,519 -4.2%
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost 10,169 9,811 3.6%
Loans held for sale 1,909 3,597 -46.9%
Loans receivable 447,933 455,931 -1.8%
Less: Allowance for loan losses 4,390 4,263 3.0%
Net loans 443,543 451,668 -1.8%
Premises and equipment, net 16,486 12,634 30.5%
Bank-owned life insurance 13,888 13,592 2.2%
Accrued interest receivable 1,074 1,552 -30.8%
Intangible assets, net 4 20 -80.0%
Goodwill 12,320 12,320 0.0%
Other assets 2,957 2,862 3.3%
Total assets $565,042 $573,450 -1.5%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits $454,826 $469,547 -3.1%
Borrowings 37,000 42,000 -11.9%
Other liabilities 7,626 6,180 23.4%
Total liabilities 499,452 517,727 -3.5%
Shareholders' equity:
Preferred stock, $1 par value; $1,000 liquidation value per issued share; 5,000,000 shares
authorized; 10,000 shares issued at September 30, 2017 and at December 31, 2016 9,700 9,700 0.0%
Common stock, $1 par value; authorized 5,000,000 shares; 3,408,875 shares
issued at September 30, 2017 and 2,844,670 shares issued at December 31, 2016 3,409 2,845 19.8%
Additional paid-in capital 50,185 41,644 20.5%
Retained earnings 4,976 4,407 12.9%
Treasury stock, at cost - 93,883 shares at September 30, 2017
and 98,118 shares at December 31, 2016 (2,802) (2,907) -3.6%
Accumulated other comprehensive income 70 (19) -468.4%
Total Elmira Savings Bank shareholders' equity 65,538 55,670 17.7%
Noncontrolling interest 52 53 -1.9%
Total shareholders' equity 65,590 55,723 17.7%
Total liabilities and shareholders' equity $565,042 $573,450 -1.5%


ELMIRA SAVINGS BANK
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
(in thousands, except for per share data) 2017 2016 % Change 2017 2016 % Change
Interest and dividend income:
Interest and fees on loans $4,695 $4,832 -2.8% $14,219 $14,305 -0.6%
Interest and dividends on securities
Taxable 240 231 3.9% 712 758 -6.1%
Non-taxable 136 203 -33.0% 481 627 -23.3%
Total interest and dividend income 5,071 5,266 -3.7% 15,412 15,690 -1.8%
Interest expense:
Interest on deposits 757 785 -3.6% 2,207 2,282 -3.3%
Interest on borrowings 267 270 -1.1% 799 1,043 -23.4%
Total interest expense 1,024 1,055 -2.9% 3,006 3,325 -9.6%
Net interest income 4,047 4,211 -3.9% 12,406 12,365 0.3%
Provision for loan losses 120 87 37.9% 315 312 1.0%
Net interest income after provision for loan losses 3,927 4,124 -4.8% 12,091 12,053 0.3%
Noninterest income:
Service fees 393 387 1.6% 1,133 1,089 4.0%
Gain on sale of loans held for sale 906 1,019 -11.1% 2,175 2,290 -5.0%
Gain on sale of securities - - - - 180 -100.0%
Other service fees 192 190 1.1% 554 556 -0.4%
Earnings on bank-owned life insurance 106 99 7.1% 297 304 -2.3%
Other 29 21 38.1% 80 86 -7.0%
Total noninterest income 1,626 1,716 -5.2% 4,239 4,505 -5.9%
Noninterest expense:
Salaries and benefits 2,080 2,087 -0.3% 5,941 5,983 -0.7%
Net occupancy 351 353 -0.6% 1,123 1,075 4.5%
Equipment 317 310 2.3% 935 886 5.5%
Marketing and public relations 186 186 0.0% 593 579 2.4%
Professional fees 156 148 5.4% 508 522 -2.7%
Other 670 892 -24.9% 2,269 2,669 -15.0%
Total noninterest expense 3,760 3,976 -5.4% 11,369 11,714 -2.9%
Income before income taxes 1,793 1,864 -3.8% 4,961 4,844 2.4%
Income taxes 578 662 -12.7% 1,559 1,549 0.6%
Net income 1,215 1,202 1.1% 3,402 3,295 3.2%
Less: Net income attributable to noncontrolling interest - - - - - -
Net income attributable to Elmira Savings Bank 1,215 1,202 1.1% 3,402 3,295 3.2%
Dividend on preferred stock 225 225 0.0% 675 675 0.0%
Income available to common shareholders $990 $977 1.3% $2,727 $2,620 4.1%
Basic earnings per share $0.30 $0.36 -16.7% $0.89 $0.96 -7.3%
Diluted earnings per share $0.30 $0.36 -16.7% $0.88 $0.96 -8.3%
Weighted average shares outstanding - basic 3,298,023 2,724,160 21.1% 3,065,817 2,719,216 12.7%
Weighted average shares outstanding - diluted 3,311,904 2,740,734 20.8% 3,081,839 2,736,262 12.6%
Dividends per share $0.23 $0.23 0.0% $0.70 $0.69 1.4%


ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
(Dollars in Thousands)For the Three Months Ended
September 30, 2017 September 30, 2016
ASSETS:Average Balance Interest Average Rate Average Balance Interest Average Rate
Loans$446,853 $4,695 4.17%$464,996 $4,832 4.13%
Short-term investments 414 1 1.52 483 - 0.20
Securities 45,092 375 3.31 52,542 434 3.30
Total interest-earning assets 492,359 5,071 4.09 518,021 5,266 4.04
Noninterest-earning assets 79,619 53,323
TOTAL ASSETS$571,978 $571,344
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits$381,146 $757 0.79 $394,097 $785 0.79
Borrowings 41,130 267 2.54 42,249 270 2.50
Total interest-bearing liabilities 422,276 1,024 0.96 436,346 1,055 0.96
Noninterest-bearing liabilities 83,854 79,033
Shareholders' equity 65,848 55,965
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$571,978 $571,344
Interest rate spread 3.13% 3.08%
Net interest income/margin $4,047 3.27% $4,211 3.24%


ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES
(Dollars in Thousands)For the Nine Months Ended
September 30, 2017 September 30, 2016
ASSETS:Average Balance Interest Average Rate Average Balance Interest Average Rate
Loans$ 450,234 $ 14,219 4.20%$ 458,862 $ 14,305 4.15%
Short-term investments 894 5 0.69 518 1 0.19
Securities 47,284 1,188 3.35 55,116 1,384 3.35
Total interest-earning assets 498,412 15,412 4.12 514,496 15,690 4.06
Noninterest-earning assets 68,250 51,701
TOTAL ASSETS$ 566,662 $ 566,197
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits$ 382,608 $ 2,207 0.77 $ 384,271 $ 2,282 0.79
Borrowings 41,775 799 2.52 51,068 1,043 2.68
Total interest-bearing liabilities 424,383 3,006 0.94 435,339 3,325 1.01
Noninterest-bearing liabilities 80,315 75,195
Shareholders' equity 61,964 55,663
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$ 566,662 $ 566,197
Interest rate spread 3.18% 3.05%
Net interest income/margin $ 12,406 3.31% $ 12,365 3.20%


Quarter Ended
(Dollars in Thousands, Except Per Share Data) 9/30/2017 6/30/2017 3/31/2017 12/31/2016 9/30/2016
Operating Data
Net income$1,215 $1,108 $1,079 $1,042 $1,202
Net interest income 4,047 4,186 4,173 4,155 4,211
Provision for loan losses 120 155 40 175 87
Net security gains - - - - -
Non-interest income, ex. Net security gains 1,626 1,352 1,261 1,395 1,716
Non-interest expense 3,760 3,781 3,828 3,888 3,976
Performance Statistics
Net interest margin 3.27% 3.36% 3.32% 3.23% 3.24%
Annualized return on average assets 0.84% 0.79% 0.78% 0.73% 0.84%
Annualized return on average equity 7.32% 7.01% 7.74% 7.38% 8.54%
Annualized net loan charge-offs to avg loans 0.03% 0.13% 0.01% 0.20% 0.05%
Net charge-offs (recoveries) 28 144 16 231 53
Efficiency ratio 66.3% 68.3% 70.4% 70.1% 67.1%
Per Share Data
Basic earnings per share$0.30 $0.28 $0.31 $0.30 $0.36
Diluted earnings per share 0.30 0.28 0.31 0.30 0.36
Dividend declared per share 0.23 0.23 0.23 0.23 0.23
Book value 16.84 16.77 16.82 16.74 16.80
Common stock price:
High 21.10 21.75 21.75 22.25 21.50
Low 19.80 19.65 20.28 18.50 18.85
Close 20.10 20.30 21.60 20.45 19.91
Weighted average common shares:
Basic 3,298 3,154 2,739 2,731 2,724
Fully diluted 3,312 3,170 2,757 2,750 2,741
End-of-period common shares:
Issued 3,409 3,405 2,850 2,845 2,839
Treasury 94 94 94 98 98
Financial Condition Data:
General
Total assets$565,042 $574,332 $556,644 $573,450 $567,450
Loans, net 443,543 448,024 446,223 451,668 455,251
Intangibles 12,324 12,329 12,334 12,340 12,349
Total deposits 454,826 460,140 450,376 469,547 463,414
Noninterest-bearing 75,625 77,027 71,870 70,330 72,102
Savings 68,253 70,668 70,300 70,621 69,019
NOW 87,612 86,896 86,633 85,822 86,787
Money Market 25,184 24,859 27,697 28,889 25,715
Time deposits 198,152 200,690 193,876 213,885 209,791
Total interest-bearing deposits 379,201 383,113 378,506 399,217 391,312
Shareholders' equity 65,590 65,280 56,103 55,723 55,792
Asset Quality
Non-performing assets$3,793 $3,494 $4,234 $5,289 $5,345
Non-performing assets to total assets 0.67% 0.61% 0.76% 0.92% 0.94%
Allowance for loan losses 4,390 4,298 4,287 4,263 4,319
Allowance for loan losses to total loans 0.98% 0.95% 0.95% 0.94% 0.94%
Allowance for loan losses to
non-performing loans 118.46% 129.15% 105.93% 84.80% 85.00%
Non-performing loans to total loans 0.84% 0.74% 0.91% 1.11% 1.12%
Capitalization
Shareholders' equity to total assets 11.61% 11.37% 10.08% 9.72% 9.83%

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

Source: Elmira Savings Bank NY (The)