White River Bancshares Co. Earns $1.15 Million, or $1.19 Per Diluted Share, in Third Quarter 2020

Wednesday, 21. October 2020 22:00

FAYETTEVILLE, Ark., Oct. 21, 2020 (GLOBE NEWSWIRE) -- White River Bancshares Company (OTCQX: WRIV), (the “Company”) the holding company for Signature Bank of Arkansas (the “Bank”), today reported net income of $1.15 million, or $1.19 per diluted share, in the third quarter of 2020, compared to $668,600, or $0.69 per diluted share, in the second quarter of 2020 and $1.33 million, or $1.36 per diluted share, in the third quarter of 2019.

In the first nine months of the year, net income was $2.56 million, or $2.64 per diluted share, compared to $4.01 million, or $4.11 per diluted share, in the first nine months of 2019. All financial results are unaudited.

“In the third quarter, the bank had solid earnings, fueled by strong growth in low cost deposits, loans and revenue. We drove non-performing assets down 70% during the quarter and 93.3% from a year ago,” said Gary Head, President and Chief Executive Officer. “Due to the growth in the loan portfolio and our continuous evaluation of the Covid situation, we added $300,000 into our loan loss reserve for the quarter, bringing the bank to what we believe is a solid position of 1.39% of total loans and 1.44% of total loans without the government guaranteed Paycheck Protection Program (“PPP”) loans.” The Company booked a $1.4 million provision for loan losses during the preceding quarter and had no provision for loan losses in the third quarter a year ago. “We continue to lower the cost of deposits by bringing in more business and personal checking accounts and repricing the cost of our CDs due to interest rates being considerably lower than the last couple of years.”

“The health and safety of our customers, teammates and community is a primary focus, as we deal with the pandemic on a local and national level,” said Brant Ward, Chief Administrative Officer. “The Bank continues to keep lobbies open by appointment only. Our customers were already using our digital platforms prior to the pandemic, but have really embraced the platform this year, with online utilization up meaningfully compared to a year ago. At the completion of the SBA’s PPP program on August 8, we had made $20.7 million in PPP loans, helping 274 local businesses. This represents approximately 1,717 years’ worth of small businesses that we were able to help.”

“Our strategic focus remains consistent, investing in digital technology to help gather low cost deposits, ensuring we continue to diversify our loan portfolios, and focusing on improving our overall efficiencies,” said Scott Sandlin, Chief Strategy Officer.

As of June 30 2020, loan modifications represented 14.25% of total loans outstanding, excluding PPP loans. As of September 30, 2020, the percentage of deferred loans to total loans excluding PPP loans had declined to 2.05%. “Our customers have done a fantastic job navigating through a difficult past six months, as seen by our drastically reduced deferral levels and our very low non-performing asset ratio,” said Jeff Maland, Chief Risk Officer. “We feel good about the underlying quality of deferred loans, most of which are longtime customer relationships with strong guarantor support. We feel our portfolio is positioned well to handle the economic impact of the pandemic, as we had less than 1% of the total loan portfolio in hotels, restaurants, and energy loans as of the end of the third quarter.”

Third Quarter 2020 Financial Highlights:

  • Third quarter net income was $1.15 million or $1.19 per diluted share.
  • Third quarter provision for loan losses was $300,000, compared to $1.4 million in the preceding quarter and no provision for loan losses in the third quarter of 2019.
  • Third quarter net interest margin (“NIM”) was 3.33%, compared to 3.65% in the preceding quarter and 3.87% in the third quarter a year ago.
  • Net loans increased 6.8% to $588.4 million at September 30, 2020, compared to $551.2 million at September 30, 2019.
  • The Bank had funded approximately 274 PPP loans totaling $20.7 million as of the close of the program on August 8, 2020.
  • Total deposits increased 17.2% to $632.5 million at September 30, 2020, compared to $539.6 million a year ago.
  • Non-interest-bearing deposits increased 56.2% to $168.5 million at September 30, 2020, compared to $107.9 million a year ago.
  • Non-performing assets decreased 70.0% to $400,100 at September 30, 2020, compared to $1.3 million at June 30, 2020 and decreased 93.3% when compared to $5.9 million a year ago.
  • Nonperforming assets (NPAs) represent 0.05% of total assets at September 30, 2020, compared to 0.18% of total assets three months earlier and 0.90% of total assets a year earlier.
  • As of September 30, 2020, the bank had loans still within the deferral process of $10.8 million, which represents 1.78% of gross loans.
  • Book value per diluted common share increased to $75.17 at September 30, 2020, from $70.13 a year ago.
  • Total risk-based capital ratio was 13.35% and Tier 1 leverage ratio was 10.77% for the Bank at September 30, 2020.

Income Statement

The Company’s net interest margin was 3.33% in the third quarter of 2020, compared to 3.87% in the third quarter of 2019 and 3.65% in the second quarter of 2020. In the first nine months of 2020, the net interest margin was 3.54%, compared to 3.94% in the first nine months of 2019.

Third quarter net interest income was $6.0 million, compared to $6.1 million in the third quarter of 2019. Total interest income decreased by 4.0% to $7.9 million in the third quarter of 2020, from $8.2 million during the third quarter of 2019. Total interest expense decreased by 10.8% to $1.9 million in the third quarter of 2020, from $2.1 million during the third quarter of 2019. In the first nine months of 2020, net interest income increased 2.4% to $18.4 million, compared to $18.0 million in the first nine months of 2019.

Non-interest income increased 98.9% to $1.2 million in the third quarter of 2020, compared to $622,000 in the third quarter a year ago. In the first nine months of the year, non-interest income increased 52.3% to $3.5 million, compared to $2.3 million in the first nine months of 2019.

Non-interest expense was $5.4 million in the third quarter of 2020, compared to $4.9 million in the third quarter of 2019. Year-to-date, non-interest expense was $16.1 million, compared to $14.9 million in the same period a year ago.

Balance Sheet Review

Total assets increased by 14.0% to $752.6 million at September 30, 2020, from $660.3 million at September 30, 2019, and decreased modestly compared to $754.2 million at June 30, 2020. Cash and cash equivalents increased to $49.6 million at September 30, 2020 from $17.2 million a year ago. Investment securities increased to $70.4 million at September 30, 2020 from $55.9 million a year ago.

Loans, net of allowance for loan losses, increased 6.8% to $588.4 million at September 30, 2020, compared to $551.2 million a year ago, and increased 3.7% compared to $567.6 million three months earlier. Through the close of the program on August 8, 2020, the Bank had funded approximately 274 PPP loans totaling $20.7 million to both existing and new customers.

Total deposits increased 17.2% to $632.5 million at September 30, 2020, compared to $539.6 million a year ago and decreased modestly compared to $635.3 million at June 30, 2020, with non-interest bearing deposits increasing 56.2% to $168.5 million at September 30, 2020, compared to $107.9 million a year ago.

FHLB advances totaled $17.2 million at September 30, 2020 from $27.6 million at September 30, 2019. Notes payable decreased to $10.8 million at September 30, 2020 from $11.6 million a year ago.

Total stockholders’ equity increased 6.6% to $72.8 million at September 30, 2020 from $68.3 million at September 30, 2019 and increased 1.6% when compared to $71.7 million at June 30, 2020. Book value per diluted common share increased to $75.17 at September 30, 2020 from $70.13 at September 30, 2019 and $73.89 at June 30, 2020.

Credit Quality

The provision for loan losses was $300,000 during the third quarter of 2020. This compares to a $1.4 million provision for loan losses in the preceding quarter and no provision for loan losses in the third quarter of 2019.  

Credit quality improved with nonperforming loans declining to $200,000 at September 30, 2020, compared to $985,000 at June 30, 2020 and $129,000 at September 30, 2019. Nonperforming assets decreased 70.0% to $400,000 at September 30, 2020 compared to $1.3 million at June 30, 2020 and decreased 93.3% when compared to $5.9 million at September 30, 2019. Total non-performing assets improved to 0.05% of total assets at September 30, 2020, compared to 0.18% of total assets three months earlier and 0.90% of total assets a year earlier.

The allowance for loan losses was $8.4 million, or 1.44% of total loans, at September 30, 2020 when excluding the $20.7 million of PPP loans, which are 100% guaranteed by the SBA. This compares to $7.0 million, or 1.25% of total loans, at September 30, 2019. Net loan charge-offs were $169,000 in the third quarter of 2020. This compares to net charge-offs of $512,000 in the second quarter of 2020 and net loan recoveries of $14,000 in the third quarter of 2019.

As of September 30, 2020, the bank had loans still within the deferral process of $12.0 million, which represents 2.05% of total loans, excluding PPP balances. Within that balance, $8.2 million of the loans were full P & I deferrals, while $3.8 million were principal deferrals.

Capital

The Bank’s capital ratios continued to exceed regulatory “well-capitalized” requirements, with a Tier 1 leverage ratio of 10.77%, Common equity tier 1 capital ratio of 12.10%, Tier 1 capital ratio of 12.10% and Total capital ratio of 13.35%, at September 30, 2020.

About White River Bancshares Company

White River Bancshares Company is the single bank holding company for Signature Bank of Arkansas. Both are headquartered in Fayetteville, Arkansas. The Bank has locations in Fayetteville, Springdale, Bentonville, Rogers and Brinkley, Arkansas. Founded in 2005, Signature Bank of Arkansas provides a full line of financial services to small businesses, families and farms. White River Bancshares Company (OTCQX: WRIV), qualified to trade on the OTCQX® Best Market in December 2018. 

About the Region

White River Bancshares Company is located in thriving Northwest Arkansas in the Fayetteville-Springdale-Rogers MSA. The region is home to the corporate headquarters for Walmart Stores Inc, Sam’s Club, Tyson Foods, Simmons Foods, and J.B. Hunt Transport. Hundreds of other market-leading companies including Procter & Gamble, Johnson & Johnson, Coca-Cola and Rubbermaid maintain offices in the region in order to maintain their relationships with the locally-based Fortune 500 companies. Northwest Arkansas is also home to the state’s flagship public educational institution, The University of Arkansas and its Sam M. Walton College of Business. The region has seen significant growth in its medical and arts infrastructures with the continued expansion of Washington Regional Medical System, Northwest Medical System, Mercy Health System of Northwest Arkansas and Arkansas Children’s Hospital Northwest. Crystal Bridges Museum of American Art and the Walton Arts Center have led the expansion of the arts. Northwest Arkansas has been repeatedly recognized in recent years as one of the best places to live in the country and remains one of the nation’s fastest-growing regions.

Forward Looking Statements

This press release contains statements about future events. These forward-looking statements, which are based on certain assumptions of management of the Company and the Bank and describe our future plans, strategies and expectations, can generally be identified by use of forward-looking terminology such as “may,” “will,” “believe,” “plan,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions or the negative of those terms. Our ability to predict results of future events and the actual effect of future plans or strategies are inherently uncertain and actual results may differ materially from those predicted in such forward-looking statements. Factors that could have a material adverse effect on our operations and future prospects or that could affect the outcome of such forward-looking statements include, but are not limited to, changes in interest rates; the economic health of the local real estate market; general economic conditions; credit deterioration in our loan portfolio that would cause us to increase our allowance for loan losses; legislative or regulatory changes; technological developments; monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality or composition of our loan and securities portfolios; demand for loan products in our market areas; deposit flows and costs of capital; competition; retention and recruitment of qualified personnel; demand for financial services in our market areas; and changes in accounting principles, policies, and guidelines. These risks and uncertainties should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements. The Company does not undertake and specifically declines any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.



WHITE RIVER BANCSHARES COMPANY
CONSOLIDATED BALANCE SHEETS
September 30, 2020, June 30, 2020 and September 30, 2019
        
UNAUDITED September 30, 2020
 June 30, 2020
 September 30, 2019
        
ASSETS
        
Cash and due from banks$49,636,364  $81,878,254  $17,033,866 
Federal funds sold  -   754,807   214,047 
        
Total cash and cash equivalents 49,636,364   82,633,061   17,247,913 
        
Investment securities 70,375,655   66,176,842   55,937,666 
Loans held for sale 10,689,131   4,366,938   1,562,200 
Loans, net of allowance for loan losses 588,429,575   567,583,991   551,184,762 
Premises and equipment, net 24,030,438   24,169,607   18,821,452 
Foreclosed assets held for sale 200,100   349,072   5,804,185 
Accrued interest receivable 2,581,457   2,320,039   2,465,854 
Deferred income taxes 1,480,231   1,370,935   2,226,003 
Other investments  2,888,585   2,884,285   2,797,885 
Other assets   2,296,588   2,379,043   2,210,704 
        
   $752,608,124  $754,233,813  $660,258,624 
        
LIABILITIES AND STOCKHOLDERS' EQUITY
        
Deposits:       
Demand deposits- non-interest bearing$168,518,880  $163,574,225  $107,892,361 
 - interest bearing 179,409,301   170,346,618   139,110,640 
Savings deposits  16,688,392   15,984,114   13,110,144 
Time deposits- under $250M 151,198,785   160,996,541   162,730,976 
 - $250M and over 116,721,324   124,392,077   116,737,980 
        
Total deposits   632,536,682   635,293,575   539,582,101 
        
Federal Home Loan Bank advances 17,161,929   17,266,002   27,572,634 
Notes payable   10,766,607   10,760,299   11,643,475 
Accrued interest payable 689,096   610,071   781,770 
Other liabilities  18,604,241   18,630,457   12,367,698 
        
Total liabilities  679,758,555   682,560,404   591,947,678 
        
Stockholders' equity:     
Common stock  9,763   9,763   9,763 
Surplus   87,940,629   87,848,223   87,562,406 
Accumulated deficit (15,737,036)  (16,887,146)  (19,430,581)
Treasury stock, at cost (431,614)  (387,022)  (112,732)
Accumulated other comprehensive income 1,067,827   1,089,591   282,090 
        
Total stockholders' equity 72,849,569   71,673,409   68,310,946 
        
   $752,608,124  $754,233,813  $660,258,624 
        



WHITE RIVER BANCSHARES COMPANY   
CONSOLIDATED STATEMENTS OF INCOME   
For the three months ended September 30, 2020, June 30, 2020 and September 30, 2019   
      
 For the Three Months Ended
UNAUDITEDSeptember 30, 2020
 June 30, 2020 September 30, 2019
 
      
Interest income:     
Loans, including fees$7,526,896  $8,096,129 $7,768,738 
Investment securities 324,464   347,157  347,434 
Federal funds sold and other 13,052   12,996  79,507 
      
Total interest income 7,864,412   8,456,282  8,195,679 
      
Interest expense:     
Deposits 1,593,311   1,771,276  1,797,879 
Federal Home Loan Bank advances 104,501   117,389  146,602 
Notes payable 167,870   164,281  147,018 
Federal funds purchased and other -   -  705 
      
Total interest expense 1,865,682   2,052,946  2,092,204 
      
Net interest income 5,998,730   6,403,336  6,103,475 
Provision for loan losses 300,000   1,415,000  - 
      
Net interest income after provision for loan losses 5,698,730   4,988,336  6,103,475 
      
Non-interest income:     
Service charges and fees on deposits 116,288   115,774  184,032 
Wealth management fee income 448,465   392,442  456,522 
Secondary market fee income 647,069   532,734  287,084 
Loss on sales and write-downs of foreclosed assets (160,679)  -  (526,944)
Other 186,058   139,120  221,225 
      
Total non-interest income 1,237,201   1,180,070  621,919 
      
Non-interest expense:     
Salaries and benefits 3,676,489   3,614,419  3,431,056 
Occupancy and equipment 663,995   634,461  582,957 
Data processing 323,980   341,067  319,184 
Marketing and business development 120,547   99,267  132,424 
Professional services 396,508   335,712  182,403 
Other 217,273   267,962  288,570 
      
Total non-interest expense 5,398,792   5,292,888  4,936,594 
      
Income before income taxes 1,537,139   875,518  1,788,800 
      
Income tax provision 387,029   206,929  458,995 
      
Net income$1,150,110  $668,589 $1,329,805 
      
Basic earnings per common share$1.19  $0.69 $1.36 
      
Diluted earnings per common share$1.19  $0.69 $1.36 
      



WHITE RIVER BANCSHARES COMPANY
CONSOLIDATED STATEMENTS OF INCOME
For the nine months ended September 30, 2020 and September 30, 2019
    
 For the Nine Months Ended
UNAUDITEDSeptember 30, 2020
 September 30, 2019
    
Interest income:   
Loans, including fees$23,358,772  $22,480,331 
Investment securities 1,031,034   1,066,630 
Federal funds sold and other 109,973   207,176 
    
Total interest income 24,499,779   23,754,137 
    
Interest expense:   
Deposits 5,255,959   4,864,474 
Federal Home Loan Bank advances 339,138   456,248 
Notes payable 500,021   441,830 
Federal funds purchased and other 32   20,946 
    
Total interest expense 6,095,150   5,783,498 
    
Net interest income 18,404,629   17,970,639 
Provision for loan losses 2,392,000   - 
    
Net interest income after provision for loan losses 16,012,629   17,970,639 
    
Non-interest income:   
Service charges and fees on deposits 406,236   531,032 
Wealth management fee income 1,309,212   1,300,735 
Secondary market fee income 1,468,552   658,347 
Loss on sales and write-downs of foreclosed assets (162,596)  (708,326)
Other 465,198   507,216 
    
Total non-interest income 3,486,602   2,289,004 
    
Non-interest expense:   
Salaries and benefits 10,961,086   9,993,259 
Occupancy and equipment 1,947,494   1,709,435 
Data processing 980,639   909,941 
Marketing and business development 346,750   449,148 
Professional services 1,124,596   836,658 
Other 735,798   961,751 
    
Total non-interest expense 16,096,363   14,860,192 
    
Income before income taxes 3,402,868   5,399,451 
    
Income tax provision 841,694   1,389,053 
    
Net income$2,561,174  $4,010,398 
    
Basic earnings per common share$2.64  $4.11 
    
Diluted earnings per common share$2.64  $4.11 
    



White River Bancshares Company     
Selected Financial Data  Three Months Ended
UNAUDITEDSeptember 30, 2020
 June 30, 2020
 September 30, 2019
       
Selected Financial Condition Data: End of Period Balances    
 Assets$752,608,124  $754,233,813  $660,258,624 
 Investment Securities 70,375,655   66,176,842   55,937,666 
 Loans, gross 607,540,859   580,242,507   559,770,307 
 Allowance for Loan Losses 8,422,153   8,291,578   7,023,345 
 Deposits 632,536,682   635,293,575   539,582,101 
 FHLB Advances 17,161,929   17,266,002   27,572,634 
 Notes Payable 10,766,607   10,760,299   11,673,475 
 Common Shareholders' Equity 72,849,569   71,673,409   68,310,946 
       
Selected Financial Condition Data: Average Balances     
 Assets$747,393,849  $736,035,654  $657,501,382 
 Earning Assets 717,205,947   705,232,474   625,176,901 
 Investment Securities 67,423,766   64,885,472   56,478,503 
 Loans, gross 588,694,448   576,641,043   552,356,254 
 Deposits 627,329,431   614,655,399   540,308,694 
 FHLB Advances 17,197,822   19,772,977   24,138,234 
 Notes Payable 10,763,088   10,756,579   11,688,777 
 Common Shareholders' Equity 72,144,578   71,019,775   67,424,620 
       
Selected Operating Results:     
 Interest Income$7,864,412  $8,456,282  $8,195,679 
 Interest Expense 1,865,682   2,052,946   2,092,204 
 Net Interest Income 5,998,730   6,403,336   6,103,475 
 Provision for Loan Losses 300,000   1,415,000   - 
 Net Interest Income After Provision for Loan Losses 5,698,730   4,988,336   6,103,475 
 Noninterest Income 1,237,201   1,180,070   621,919 
 Noninterest Expense 5,398,792   5,292,888   4,936,594 
 Income Before Income Taxes 1,537,139   875,518   1,788,800 
 Income Tax Provision 387,029   206,929   458,995 
 Net Income$1,150,110  $668,589  $1,329,805 
       
 Basic Net Income per Common Share$1.19  $0.69  $1.36 
 Diluted Net Income per Common Share 1.19   0.69   1.36 
 Dividends Paid per Common Share -   -   - 
 Book Value Per Common Share 75.17   73.89   70.13 
 Book Value Per Common Share-Diluted 75.17   73.89   70.13 
 Common Shares Outstanding 969,069   969,998   974,127 
 Diluted Common Shares Outstanding 969,069   969,998   974,127 
 Basic Weighted Average Common Shares Outstanding 969,907   969,998   975,014 
 Diluted Weighted Average Common Shares Outstanding 969,907   969,998   975,014 
       
Selected Ratios:     
 Return on Average Assets 0.61%  0.37%  0.80%
 Return on Average Common Shareholders' Equity 6.34%  3.79%  7.82%
 Average Common Shareholders' Equity to Average Assets 9.65%  9.65%  10.25%
 Net Interest Margin 3.33%  3.65%  3.87%
 Efficiency 74.61%  69.80%  73.40%
       
Selected Asset Quality:     
 Net (Recoveries) Charge-offs$169,425  $511,950  $(13,738)
 Classified Assets 661,616   1,597,207   6,194,407 
 Nonperforming Loans 200,000   985,000   129,111 
 Nonperforming Assets 400,100   1,334,072   5,933,296 
 Total Nonperforming Loans to Total Loans 0.03%  0.17%  0.02%
 Total Nonperforming Loans to Total Assets 0.03%  0.13%  0.02%
 Total Nonperforming Assets to Total Assets 0.05%  0.18%  0.90%


Contact:Scott Sandlin, Chief Strategy Officer
 479-684-3754

Primary Logo

Related Links: 
Author:
Copyright GlobeNewswire, Inc. 2016. All rights reserved.
You can register yourself on the website to receive press releases directly via e-mail to your own e-mail account.