SB One Bancorp Reports a 57% Increase in Net Income and Diluted EPS of $0.55 for the Third Quarter 2019

Friday, 25. October 2019 15:00

PARAMUS, N.J., Oct. 25, 2019 (GLOBE NEWSWIRE) -- SB One Bancorp (the “Company”) (Nasdaq: SBBX), the holding company for SB One Bank (the “Bank”), today reported net income of $5.1 million, or $0.55 per basic and diluted share, for the quarter ended September 30, 2019, an increase of 57.3%, as compared to net income of $3.3 million, or $0.42 per basic share and $0.41 per diluted share, for the quarter ended September 30, 2018. The increase in net income for the quarter ended September 30, 2019 was driven by a $3.7 million, or 33.6%, increase in net interest income attributable to loan and deposit growth and the merger with Enterprise Bank NJ (“Enterprise”), and a $585 thousand increase in non-interest income as compared to the same period last year. The increase in net income was partially offset by a $1.2 million, or 13.7%, increase in non-interest expense. The non-interest expense increase was mainly due to a $1.2 million, or 23.7%, increase in compensation mainly from the Enterprise merger, net of realized cost savings, and to support the continued growth of the Company offset by a decrease in merger related expenses of $605 thousand.

The Company reported net income of $17.2 million, or $1.84 per basic and $1.83 diluted share, for the nine months ended September 30, 2019, an increase of 127.4%, as compared to $7.6 million, or $0.97 per basic share and $0.96 per diluted share, for the same period last year. For the nine months ended September 30, 2019, net income growth was driven by an increase in net interest income of $11.4 million, or 34.7%, resulting from growth of $18.9 million in loan interest income which was attributable to organic loan growth and the merger with Enterprise. In addition, non-interest income increased $2.9 million, or 34.8%, from a $1.2 million increase in insurance commissions and fees as compared to the same period last year. The increase in net income was partially offset by an increase in non-interest expense of $754 thousand, or 2.5%.

Anthony Labozzetta, President and CEO of SB One Bancorp and SB One Bank stated, “We continue to have strong growth in all of our business lines.  Despite the volatile interest rate environment, our commercial lending team grew loans at an annualized rate of 10.2%.  Our Insurance Company continues to out-perform and grew commission income 19.4% over the same period last year.  Our Retail deposits grew at an annualized rate of 14.5%.  Furthermore, the activities and pipelines in each of our business lines remain robust.”  Mr. Labozzetta added, “While our margin compressed this quarter, we are seeing a reduction in our costs of deposits and borrowings, which was evident in the month of September and we expect that positive trend to continue into the fourth quarter”. 

Mr. Labozzetta also stated, “We continue to experience improving trends in asset quality with our ratio of non-performing assets to total assets decreasing 26 basis points to 0.87%”.

Declaration of Quarterly Dividend
On October 24, 2019, the Company’s Board of Directors declared a quarterly cash dividend of $0.085 per share, which is payable on November 20, 2019 to common shareholders of record as of the close of business on November 6, 2019.

Financial Performance
Net Income. For the quarter ended September 30, 2019, the Company reported net income of $5.1 million, or $0.55 per basic and diluted share, an increase of 57.3%, as compared to net income of $3.3 million, or $0.42 per basic and $0.41 diluted share, for the quarter ended September 30, 2018.

The increase in net income for the quarter ended September 30, 2019 was driven by a $3.7 million, or 33.6%, increase in net interest income resulting from loan and deposit growth, the Enterprise merger, and a $585 thousand increase in non-interest income mainly due to a $297 thousand increase in insurance commissions and fees. Non-interest expenses increased $1.2 million to $10.2 million for the third quarter 2019 as compared to $9.0 million for the third quarter 2018. The increase in non-interest expenses was primarily attributable to an increase in salaries and employee benefits of $1.2 million resulting from the merger with Enterprise and the continued growth of the Company. In addition, data processing increased $290 thousand and write-downs related to foreclosed real estate increased $152 thousand. The increase in non-interest expenses was partially offset by a decrease in merger related expenses of $605 thousand as compared to the same quarter of 2018.

For the nine months ended September 30, 2019, the Company reported net income of $17.2 million, or $1.84 per basic share and $1.83 per diluted share, an increase of 127.4%, as compared to net income of $7.6 million, or $0.97 per basic share and $0.96 diluted share, for the same period last year. 

Net Interest Income.  Net interest income on a fully tax equivalent basis increased $3.5 million, or 31.5%, to $14.8 million for the third quarter of 2019, as compared to $11.2 million for the same period in 2018.  The increase in net interest income was largely due to a $440.4 million, or 32.5%, increase in average interest earning assets, principally loans receivable, which increased $395.8 million, or 34.3%, led by organic growth and the December 2018 closing of the Enterprise merger.  The net interest margin decreased 3 basis points to 3.26% for the third quarter of 2019, as compared to the same period in 2018, as a result of an increase in cost of funds of 44 basis points mainly due to a surge in rates on deposits. The increase in the Company’s cost of funds was partially offset by an increase in yield on earning assets of 34 basis points driven by an increase in yields on loans receivable of 42 basis points.  

Net interest income on a fully tax equivalent basis increased $11.2 million, or 33.5%, to $44.6 million for the first nine months of 2019 as compared to $33.4 million for the same period in 2018.  The increase in net interest income was largely due to a $446.1 million, or 34.2%, increase in average interest earning assets, principally loans receivable, which increased $412.2 million, or 37.1%, driven by organic growth and the Enterprise merger.

Provision for Loan Losses. Provision for loan losses increased $315 thousand, or 98.1%, to $636 thousand for the third quarter of 2019, as compared to $321 thousand for the same period in 2018.

Provision for loan losses increased $756 thousand, or 61.6%, to $2.0 million for the first nine months of 2019, as compared to $1.2 million for the same period in 2018.

Non-interest Income. Non-interest income increased $585 thousand, or 23.2%, to $3.1 million for the third quarter of 2019, as compared to the same period in 2018.  The growth was largely due to an increase in insurance commissions and fees relating to SB One Insurance Agency of $297 thousand, or 19.4%, for the third quarter of 2019, as compared to the same period in 2018. 

Non-interest income increased $2.9 million, or 34.8%, to $11.1 million for the first nine months of 2019 as compared to the same period last year.  The increase was principally due to $1.2 million increase in insurance commissions and fees relating to SB One Insurance Agency, and a $1.5 million increase in gains on sale of securities. The aforementioned increases were partially offset by a $292 thousand loss on the disposal of fixed assets relating to closing of the Company’s corporate center in Rockaway, NJ, and the sale of the Andover branch.

Non-interest Expense. The Company’s non-interest expenses increased $1.2 million, or 13.7%, to $10.2 million for the third quarter of 2019, as compared to the same period in 2018. The increase in non-interest expenses occurred largely in salaries and employee benefits of $1.2 million, data processing of $290 thousand and expenses and write-downs related to foreclosed real estate of $152 thousand. The increase in non-interest expenses for the third quarter of 2019, as compared to the same period in 2018, was the result of the Company’s continued growth, inclusive of the Enterprise merger net of cost savings. The increase in expenses and write-downs related to foreclosed real estate was driven by a one-time charge for write-downs of $149 thousand on three properties. The aforementioned increases were partially offset by decreases in professional fees and FDIC assessment costs of $111 thousand and $45 thousand, respectively.

The Company’s non-interest expenses increased $754 thousand, or 2.5%, to $30.9 million for the first nine months of 2019 as compared to the same period last year. The increase in non-interest expenses was primarily due to increases in salaries and employee benefits of $3.2 million, occupancy of $518 thousand and data processing of $499 thousand.  The aforementioned increase was partially offset by a decrease in merger related expenses of $4.3 million.

Income Tax Expense. The Company’s income tax expenses increased $863 thousand to $1.8 million for the third quarter of 2019, as compared to the same period last year. The Company’s effective tax rate for the third quarter of 2019 was 26.1%, as compared to 22.6% for the same period in 2018.

The Company’s income tax expenses increased $3.1 million to $5.2 million for the first nine months of 2019, as compared to the same period last year as a result of increased pre-tax income. The Company’s effective tax rate for the first nine months of 2019 was 23.1%, as compared to 21.5% for the nine months ended September 30, 2018.

Financial Condition
At September 30, 2019, the Company’s total assets were $1.9 billion, an increase of $138.6 million, or 7.7%, as compared to total assets of $1.8 billion at December 31, 2018.  The increase was mainly attributable to an increase in loans receivable of $88.8 million, or 6.0%, to $1.6 billion.

The Company’s total deposits increased $172.9 million, or 12.8%, to $1.5 billion at September 30, 2019, from $1.4 billion at December 31, 2018. The growth in deposits was mostly due to an increase in interest bearing deposits of $157.0 million, or 14.3%, and an increase in non-interest bearing deposits of $15.9 million, or 6.1%, at September 30, 2019, as compared to December 31, 2018.

At September 30, 2019, the Company’s total stockholders’ equity was $196.1 million, an increase of $10.6 million when compared to December 31, 2018.  At September 30, 2019, the leverage, Tier I risk-based capital, total risk-based capital and common equity Tier I capital ratios for the Bank were 10.22%, 12.00%, 12.61% and 12.00%, respectively, all in excess of the ratios required to be deemed “well-capitalized.”

Asset and Credit Quality
The ratio of non-performing assets (“NPAs”), which include non-accrual loans, loans 90 days past due and still accruing, troubled debt restructured loans currently performing in accordance with renegotiated terms and foreclosed real estate, to total assets decreased to 0.87% at September 30, 2019 as compared to 1.43% at December 31, 2018.  The decrease in NPAs is mainly attributable to the payoff of two non-accrual commercial real estate loans totaling approximately $8.9 million. NPAs exclude $3.0 million of Purchased Credit-Impaired (“PCI”) loans acquired through the merger with Community Bank of Bergen County (“Community Bank”). NPAs decreased $8.9 million to $16.9 million at September 30, 2019, as compared to $25.8 million at December 31, 2018.  Non-accrual loans, excluding $3.0 million of PCI loans, decreased $8.7 million, or 41.9%, to $12.0 million at September 30, 2019, as compared to $20.7 million at December 31, 2018.  Loans past due 30 to 89 days totaled $5.5 million at September 30, 2019, representing an increase of $1.7 million, or 45.8%, as compared to $3.8 million at December 31, 2018.

The Company continues to actively market its foreclosed real estate properties, the value of which decreased $549 thousand to $3.6 million at September 30, 2019 as compared to $4.1 million at December 31, 2018.  The decrease in foreclosed real estate properties was largely attributable to the sale of six properties totaling $1.5 million which was partially offset by two new foreclosed properties valued at $1.1 million. At September 30, 2019, the Company’s foreclosed real estate properties had an average carrying value of approximately $400 thousand per property.

The Company’s allowance for loan losses increased $975 thousand, or 11.1%, to $9.8 million, at September 30, 2019 as compared to $8.8 million at December 31, 2018. The Company’s outstanding credit mark recorded on the legacy Community Bank and Enterprise portfolios of $433.8 million totaled $6.8 million at September 30, 2019. The Company’s combined coverage of allowance for loan loss and credit mark on the legacy Community Bank and Enterprise portfolios totaled $16.8 million, or 1.05% of the overall loan portfolio, at September 30, 2019. The Company recorded $2.0 million in provision for loan losses for the nine months ended September 30, 2019 as compared to $1.2 million for the nine months ended September 30, 2018.  Additionally, the Company recorded net charge-offs of $1.0 million for the nine months ended September 30, 2019, as compared to $33 thousand in net recoveries for the nine months ended September 30, 2018. The allowance for loan losses as a percentage of non-accrual loans increased to 81.1% at September 30, 2019 from 43.5% at December 31, 2018.

About SB One Bancorp

SB One Bancorp (Nasdaq: SBBX), is the holding company for SB One Bank, a full-service, commercial bank that operates regionally with 18 branch locations in New Jersey and New York. Established in 1975, SB One Bank's strength is in its ability to build strong personal relationships with its customers and to serve the communities in which it operates. In addition to its branches and loan production offices, SB One Bank offers a full-service insurance agency, SB One Insurance Agency, Inc. and wealth services through SB One Wealth. SB One Bank reinforces its commitment to the communities in which it lives and serves through the SB One Foundation, Inc. which supports various local charitable organizations.

SB One Bancorp was recently added to the Russell 2000® Index and Russell 3000® Index. In 2017, it was recognized as one of the top 29 banks and thrifts nationwide and one of three from New Jersey that comprise the Sandler O’Neill Sm-All Stars Class of 2017. SB One Bancorp is one of the 50 Fastest Growing Companies in New Jersey as ranked by NJBIZ Magazine. SB One Bancorp President and Chief Executive Officer, Anthony Labozzetta, was named one of America’s Business Leaders in Banking by Forbes magazine and American Banker’s Community Banker of the Year in 2016.

For more details on SB One Bank, visit: www.SBOne.bank

Forward-Looking Statements

This press release contains statements that are forward looking and are made pursuant to the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to statements that may be identified by the use of words such as "expect," "estimate," “assume,” "believe," "anticipate," "will," "forecast," "plan," "project" or similar words. Such statements are based on SB One Bancorp’s current expectations and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, (1) difficulties and delays in integrating the business or fully realizing cost savings and other benefits; (2) operating costs, customer loss and business disruption following the mergers with Community Bank and Enterprise, including adverse effects on relationships with employees, may be greater than expected; (3) changes to interest rates; (4) the ability to control costs and expenses; (5) general economic conditions; (6) the success of SB One Bancorp’s efforts to diversify its revenue base by developing additional sources of non-interest income while continuing to manage its existing fee-based business; and (7) risks associated with the quality of SB One Bancorp’s assets and the ability of its borrowers to comply with repayment. Further information about these and other relevant risks and uncertainties may be found in SB One Bancorp’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and in subsequent filings with the Securities and Exchange Commission. SB One Bancorp undertakes no obligation to publicly release the results of any revisions to those forward looking statements that may be made to reflect events or circumstances after this date or to reflect the occurrence of unanticipated events.

SB ONE BANCORP
Anthony Labozzetta, President/CEO
Adriano Duarte, CFO
(p) 844-256-7328

 
SB ONE BANCORP
SUMMARY FINANCIAL HIGHLIGHTS
(In Thousands, Except Percentages and Per Share Data)
(Unaudited)
                          
             9/30/2019 VS.
  9/30/19 6/30/19 12/31/18 9/30/18  6/30/19 12/31/18 9/30/18
BALANCE SHEET HIGHLIGHTS - Period End Balances                       
Total securities $211,467  $198,191  $186,217  $177,547    6.7 %  13.6 %  19.1 %
Total loans  1,563,610   1,530,668   1,474,775   1,171,738    2.2 %  6.0 %  33.4 %
Allowance for loan losses  (9,750)  (9,627)  (8,775)  (8,594)   1.3 %  11.1 %  13.5 %
Total assets  1,934,259   1,866,344   1,795,703   1,459,642    3.6 %  7.7 %  32.5 %
Total deposits  1,526,856   1,476,488   1,353,939   1,114,646    3.4 %  12.8 %  37.0 %
Total borrowings and junior subordinated debt  191,715   180,535   247,765   187,756    6.2 %  (22.6)%  2.1 %
Total shareholders' equity  196,079   192,416   185,444   151,222    1.9 %  5.7 %  29.7 %
                          
FINANCIAL DATA - QUARTER ENDED:                         
Net interest income (tax equivalent) (a) $14,753  $15,161  $11,575  $11,217    (2.7)%  27.5 %  31.5 %
Provision for loan losses  636   776   210   321    (18.0)%  202.9 %  98.1 %
Total non-interest income  3,103   4,392   2,493   2,518    (29.3)%  24.5 %  23.2 %
Total non-interest expense  10,187   10,526   10,273   8,963    (3.2)%  (0.8)%  13.7 %
Income before provision for income taxes (tax equivalent)  7,033   8,251   3,585   4,451    (14.8)%  96.2 %  58.0 %
Provision for income taxes  1,820   1,836   991   957    (0.9)%  83.7 %  90.2 %
Taxable equivalent adjustment (a)  68   171   807   224    (60.2)%  (91.6)%  (69.6)%
Net income $5,145  $6,244  $1,787  $3,270    (17.6)%  187.9 %  57.3 %
                          
Net income per common share - Basic $0.55  $0.67  $0.29  $0.42    (17.9)%  89.7 %  32.2 %
Net income per common share - Diluted $0.55  $0.66  $0.29  $0.41    (16.7)%  89.7 %  33.1 %
                          
Return on average assets  1.08 %1.35 %0.53 %0.91 % (20.0)%  102.4 %  19.0 %
Return on average equity  10.56 %12.98 %4.97 %8.67 % (18.6)%  112.6 %  21.9 %
Efficiency ratio (b)  57.27 %54.31 %77.47 %66.34 % 5.5 %  (26.1)%  (13.7)%
Net interest margin (tax equivalent)  3.26 %3.49 %3.55 %3.29 % (6.6)%  (8.2)%  (0.9)%
Avg. interest earning assets/Avg. interest bearing liabilities  1.26   1.27   1.27   1.28    (0.7)%  (1.2)%  (1.8)%
                          
FINANCIAL DATA - YEAR TO DATE:                         
Net interest income (tax equivalent) (a) $44,580        $33,393            33.5 %
Provision for loan losses  1,983         1,227            61.6 %
Total non-interest income  11,128         8,256            34.8 %
Total non-interest expense  30,891         30,137            2.5 %
Income before provision for income taxes (tax equivalent)  22,834         10,285            122.0 %
Provision for income taxes  5,156         2,068            149.3 %
Taxable equivalent adjustment (a)  466         647            (28.0)%
Net income $17,212        $7,570            127.4 %
                          
Net income per common share - Basic $1.84        $0.97            89.7 %
Net income per common share - Diluted $1.83        $0.96            90.6 %
                          
Return on average assets  1.23 %      0.72 %         70.4 %
Return on average equity  11.97 %      6.84 %         74.9 %
Efficiency ratio (b)  55.92 %      73.50 %         (23.9)%
Net interest margin (tax equivalent)  3.40 %      3.42 %         (0.6)%
Avg. interest earning assets/Avg. interest bearing liabilities  1.26         1.28            (1.4)%
                          
SHARE INFORMATION:                         
Book value per common share $20.81  $20.35  $19.45  $19.00    2.3 %  7.0 %  9.5 %
Tangible book value per common share  17.71   17.25   16.36   15.73    2.7 %  8.3 %  12.6 %
Outstanding shares- period ending  9,423,931   9,456,778   9,532,943   7,959,489    (0.3)%  (1.1)%  18.4 %
Average diluted shares outstanding (year to date)  9,410,311   9,406,175   7,921,269   7,868,280    0.0 %  18.8 %  19.6 %
                          
CAPITAL RATIOS:                         
Total equity to total assets  10.14 %10.31 %10.32 %10.36 % (1.7)%  (1.7)%  (2.2)%
Leverage ratio (c)  10.22 %10.32 %12.06 %10.51 % (1.0)%  (15.3)%  (2.8)%
Tier 1 risk-based capital ratio (c)  12.00 %12.10 %12.34 %12.74 % (0.8)%  (2.8)%  (5.8)%
Total risk-based capital ratio (c)  12.61 %12.72 %12.94 %13.48 % (0.9)%  (2.6)%  (6.5)%
Common equity Tier 1 capital ratio (c)  12.00 %12.10 %12.34 %12.74 % (0.8)%  (2.8)%  (5.8)%
                          
ASSET QUALITY:                         
Non-accrual loans (e) $12,019  $16,243  $20,704  $19,758    (26.0)%  (41.9)%  (39.2)%
Loans 90 days past due and still accruing  1   -   -   -    - %  - %  - %
Troubled debt restructured loans ("TDRs") (d)  1,238   1,246   906   1,986    (0.6)%  36.6 %  (37.7)%
Foreclosed real estate  3,600   3,576   4,149   2,657    0.7 %  (13.2)%  35.5 %
Non-performing assets ("NPAs") $16,858  $21,065  $25,759  $24,401    (20.0)%  (34.6)%  (30.9)%
                          
Foreclosed real estate, criticized and classified assets (e) $24,233  $29,039  $24,006  $22,945    (16.6)%  0.9 %  5.6 %
Loans past due 30 to 89 days $5,522  $8,904  $3,787  $3,339    (38.0)%  45.8 %  65.4 %
Charge-offs (Recoveries) , net (quarterly) $440  $339  $30  $(9)   29.8 %  1,366.7 %  (4,988.9)%
Charge-offs (Recoveries) , net as a % of average loans (annualized)  0.11 %0.09 %0.01 %(0.00)% 27.1 %  1,061.1 %  (3,739.4)%
Non-accrual loans to total loans  0.77 %1.06 %1.40 %1.69 % (27.6)%  (45.1)%  (54.4)%
NPAs to total assets  0.87 %1.13 %1.43 %1.67 % (22.8)%  (39.1)%  (47.9)%
NPAs excluding TDR loans (d) to total assets  0.81 %1.06 %1.35 %1.54 % (24.0)%  (40.3)%  (47.4)%
Non-accrual loans to total assets  0.62 %0.87 %1.12 %1.35 % (28.6)%  (44.6)%  (54.1)%
Allowance for loan losses as a % of non-accrual loans  81.12 %59.27 %43.51 %43.50 % 36.9 %  86.5 %  86.5 %
Allowance for loan losses to total loans  0.62 %0.63 %0.60 %0.73 % (0.9)%  4.8 %  (15.0)%
                          
(a) Full taxable equivalent basis, using a 30.09% effective tax rate and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance
(b) Efficiency ratio calculated non-interest expense divided by net interest income plus non-interest income 
(c) SB One Bank capital ratios
(d) Troubled debt restructured loans currently performing in accordance with renegotiated terms 
(e) PCI loans acquired through merger with Community Bank excluded from non-accrual loans and criticized and classified assets totaled $3.0 million
 


SB ONE BANCORP
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)
     
ASSETSSeptember 30, 2019  December 31, 2018
     
Cash and due from banks$11,561  $11,768
Interest-bearing deposits with other banks 36,380   14,910
Cash and cash equivalents 47,941   26,678
     
Interest bearing time deposits with other banks 200   200
Securities available for sale, at fair value 207,136   182,139
Securities held to maturity 4,331   4,078
Other Bank Stock, at cost 9,382   11,764
     
Loans receivable, net of unearned income 1,563,610   1,474,775
Less: allowance for loan losses 9,750   8,775
Net loans receivable 1,553,860   1,466,000
     
Foreclosed real estate 3,600   4,149
Premises and equipment, net 19,663   19,215
Right-of-use assets, net 4,734   -
Accrued interest receivable 6,253   6,546
Goodwill and intangibles 29,141   29,446
Bank-owned life insurance 36,475   35,778
Other assets 11,543   9,710
     
Total Assets$1,934,259  $1,795,703
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
     
Liabilities:    
Deposits:    
Non-interest bearing$275,730  $259,807
Interest bearing 1,251,126   1,094,132
Total Deposits 1,526,856   1,353,939
     
Borrowings 163,849   219,906
Lease liability 4,870   -
Accrued interest payable and other liabilities 14,739   8,555
Subordinated debentures 27,866   27,859
     
Total Liabilities 1,738,180   1,610,259
     
Total Stockholders' Equity 196,079   185,444
     
Total Liabilities and Stockholders' Equity$1,934,259  $1,795,703
     


SB ONE BANCORP
CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands Except Per Share Data)
(Unaudited)
 Three Months Ended September 30, Nine Months Ended
  2019  2018 9/30/19 9/30/18
INTEREST INCOME        
Loans receivable, including fees$19,135 $13,009 $56,354  $37,471
Securities:       
Taxable 1,490  936  3,942   2,476
Tax-exempt 135  442  920   1,272
Federal funds sold -  -  -   -
Interest bearing deposits 97  23  211   69
Total Interest Income 20,857  14,410  61,427   41,288
        
INTEREST EXPENSE       
Deposits 4,755  2,156  13,078   5,273
Borrowings 1,099  943  3,286   2,323
Junior subordinated debentures 318  318  949   946
Total Interest Expense 6,172  3,417  17,313   8,542
        
Net Interest Income 14,685  10,993  44,114   32,746
PROVISION FOR LOAN LOSSES 636  321  1,983   1,227
Net Interest Income after Provision for Loan Losses 14,049  10,672  42,131   31,519
        
NON-INTEREST INCOME       
Service fees on deposit accounts 351  320  1,048   959
ATM and debit card fees 289  254  798   717
Bank owned life insurance 235  190  697   563
Insurance commissions and fees 1,824  1,527  6,482   5,261
Investment brokerage fees 49  29  126   92
Gain (loss) gain on securities transactions -  -  1,524   36
(Loss) gain on disposal of fixed assets 89  -  (292)  9
Other 266  198  745   619
Total Non-Interest Income 3,103  2,518  11,128   8,256
        
NON-INTEREST EXPENSE       
Salaries and employee benefits 6,224  5,033  18,688   15,502
Occupancy, net 840  757  2,604   2,086
Data processing 1,000  710  2,939   2,440
Furniture and equipment 343  286  975   893
Advertising and promotion 139  147  394   488
Professional fees 272  383  1,106   1,002
Director fees 146  121  471   410
FDIC assessment 138  183  585   393
Insurance 31  35  94   182
Stationary and supplies 73  59  247   205
Merger-related expenses -  605  -   4,344
Loan collection costs 96  53  233   203
Expenses and write-downs related to foreclosed real estate 172  20  333   228
Amortization of intangible assets 102  61  305   182
Other 611  510  1,917   1,579
Total Non-Interest Expense 10,187  8,963  30,891   30,137
        
Income before Income Taxes 6,965  4,227  22,368   9,638
INCOME TAX EXPENSE  1,820  957  5,156   2,068
Net Income $5,145 $3,270 $17,212  $7,570
        
EARNINGS PER SHARE       
Basic$0.55 $0.42 $1.84  $0.97
Diluted$0.55 $0.41 $1.83  $0.96
             


SB ONE BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Dollars In Thousands)
(Unaudited)
             
  Three Months Ended September 30,
   2019  2018
    Average   Average    Average   Average
   Balance  Interest Rate (2)  Balance  Interest Rate (2)
Earning Assets:            
Securities:            
Tax exempt (3) $17,712  $203  4.55% $63,752  $666  4.14%
Taxable  195,463   1,490  3.02%  126,961   936  2.92%
Total securities  213,175   1,693  3.15%  190,713   1,602  3.33%
Total loans receivable (1) (4)  1,548,515   19,135  4.90%  1,152,741   13,009  4.48%
Other interest-earning assets  32,383   97  1.19%  10,219   23  0.89%
Total earning assets  1,794,073   20,925  4.63%  1,353,673   14,634  4.29%
             
Non-interest earning assets  122,954       97,181     
Allowance for loan losses  (9,898)      (8,388)    
Total Assets $1,907,129      $1,442,466     
             
Sources of Funds:            
Interest bearing deposits:            
NOW $242,258  $498  0.82% $257,671  $365  0.56%
Money market  234,127   1,080  1.83%  125,430   538  1.70%
Savings  221,892   369  0.66%  213,152   266  0.50%
Time  531,178   2,808  2.10%  262,244   987  1.49%
Total interest bearing deposits  1,229,455   4,755  1.53%  858,497   2,156  1.00%
Borrowed funds  168,998   1,099  2.58%  170,168   943  2.20%
Subordinated debentures  27,865   318  4.53%  27,854   318  4.53%
Total interest bearing liabilities  1,426,318   6,172  1.72%  1,056,519   3,417  1.28%
             
Non-interest bearing liabilities:            
Demand deposits  268,864       228,993     
Other liabilities  17,141       6,081     
Total non-interest bearing liabilities  286,005       235,074     
Stockholders' equity  194,806       150,873     
Total Liabilities and Stockholders' Equity $1,907,129      $1,442,466     
             
Net Interest Income and Margin (5)    14,753  3.26%    11,217  3.29%
Tax-equivalent basis adjustment     (68)      (224)  
Net Interest Income   $14,685      $10,993   
             
(1) Includes loan fee income 
(2) Average rates on securities are calculated on amortized costs 
(3) Full taxable equivalent basis, using an effective tax rate of 30.09% in 2019 and 2018 and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance 
(4) Loans outstanding include non-accrual loans 
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets 
             
             
SB ONE BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Dollars In Thousands)
(Unaudited)
             
   
  Three Months Ended September 30, 2019 Three Months Ended June 30, 2019
    Average   Average    Average   Average
   Balance  Interest Rate (2)  Balance  Interest Rate (2)
Earning Assets:            
Securities:            
Tax exempt (3) $17,712  $203  4.55% $46,888  $508  4.35%
Taxable  195,463   1,490  3.02%  158,258   1,277  3.24%
Total securities  213,175   1,693  3.15%  205,146   1,785  3.49%
Total loans receivable (1) (4)  1,548,515   19,135  4.90%  1,516,945   19,059  5.04%
Other interest-earning assets  32,383   97  1.19%  20,386   65  1.28%
Total earning assets  1,794,073   20,925  4.63%  1,742,477   20,909  4.81%
             
Non-interest earning assets  122,954       118,391     
Allowance for loan losses  (9,898)      (9,332)    
Total Assets $1,907,129      $1,851,536     
             
Sources of Funds:            
Interest bearing deposits:            
NOW $242,258  $498  0.82% $249,647  $453  0.73%
Money market  234,127   1,080  1.83%  230,766   1,165  2.02%
Savings  221,892   369  0.66%  226,511   372  0.66%
Time  531,178   2,808  2.10%  494,823   2,469  2.00%
Total interest bearing deposits  1,229,455   4,755  1.53%  1,201,747   4,459  1.49%
Borrowed funds  168,998   1,099  2.58%  145,937   973  2.67%
Subordinated debentures  27,865   318  4.53%  27,863   316  4.55%
Total interest bearing liabilities  1,426,318   6,172  1.72%  1,375,547   5,748  1.68%
             
Non-interest bearing liabilities:            
Demand deposits  268,864       272,667     
Other liabilities  17,141       10,934     
Total non-interest bearing liabilities  286,005       283,601     
Stockholders' equity  194,806       192,388     
Total Liabilities and Stockholders' Equity $1,907,129      $1,851,536     
             
Net Interest Income and Margin (5)    14,753  3.26%    15,161  3.49%
Tax-equivalent basis adjustment     (68)      (171)  
Net Interest Income   $14,685      $14,990   
             
(1) Includes loan fee income 
(2) Average rates on securities are calculated on amortized costs 
(3) Full taxable equivalent basis, using an effective tax rate of 30.09% in 2019 and 2018 and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance 
(4) Loans outstanding include non-accrual loans 
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets 
             
             
SB ONE BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Dollars In Thousands)
(Unaudited)
             
  Nine Months Ended September 30,
   2019  2018
    Average   Average    Average   Average
   Balance  Interest Rate (2)  Balance  Interest Rate (2)
Earning Assets:            
Securities:            
Tax exempt (3) $42,253  $1,386  4.39% $61,187  $1,919  4.19%
Taxable  165,482   3,942  3.18%  124,756   2,476  2.65%
Total securities  207,735   5,328  3.43%  185,943   4,395  3.16%
Total loans receivable (1) (4)  1,522,197   56,354  4.95%  1,109,975   37,471  4.51%
Other interest-earning assets  22,588   211  1.25%  10,456   69  0.88%
Total earning assets  1,752,520   61,893  4.72%  1,306,374   41,935  4.29%
             
Non-interest earning assets  118,562       96,629     
Allowance for loan losses  (9,353)      (7,993)    
Total Assets $1,861,729      $1,395,010     
             
Sources of Funds:            
Interest bearing deposits:            
NOW $249,238  $1,397  0.75% $255,823  $1,110  0.58%
Money market  235,252   3,423  1.95%  104,603   1,073  1.37%
Savings  223,338   1,068  0.64%  218,359   534  0.33%
Time  487,806   7,190  1.97%  263,533   2,556  1.30%
Total interest bearing deposits  1,195,634   13,078  1.46%  842,318   5,273  0.84%
Borrowed funds  167,899   3,286  2.62%  152,178   2,323  2.04%
Subordinated debentures  27,863   949  4.55%  27,852   946  4.54%
Total interest bearing liabilities  1,391,396   17,313  1.66%  1,022,348   8,542  1.12%
             
Non-interest bearing liabilities:            
Demand deposits  266,999       220,156     
Other liabilities  11,558       4,978     
Total non-interest bearing liabilities  278,557       225,134     
Stockholders' equity  191,776       147,528     
Total Liabilities and Stockholders' Equity $1,861,729      $1,395,010     
             
Net Interest Income and Margin (5)    44,580  3.40%    33,393  3.42%
Tax-equivalent basis adjustment     (466)      (647)  
Net Interest Income   $44,114      $32,746   
             
(1) Includes loan fee income 
(2) Average rates on securities are calculated on amortized costs 
(3) Full taxable equivalent basis, using an effective tax rate of 30.09% in 2019 and 2018 and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance 
(4) Loans outstanding include non-accrual loans 
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets 
             


SB ONE BANCORP
Segment Reporting
(Dollars In Thousands)
(Unaudited)
                  
                  
 Three Months Ended September 30, 2019 Three Months Ended September 30, 2018
 Banking and       Banking and      
 Financial Insurance    Financial Insurance   
 Services Services Total Services Services Total
Net interest income from external sources$14,685 $- $14,685 $10,993 $- $10,993
Other income from external sources 1,239  1,864  3,103  967  1,551  2,518
Depreciation and amortization 488  10  498  455  7  462
Income before income taxes 6,648  317  6,965  3,907  320  4,227
Income tax expense (1) 1,693  127  1,820  829  128  957
Total assets 1,927,351  6,908  1,934,259  1,453,536  6,106  1,459,642
                  
                  
 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018
 Banking and       Banking and      
 Financial Insurance    Financial Insurance   
 Services Services Total Services Services Total
Net interest income from external sources$44,114 $- $44,114 $32,746 $- $32,746
Other income from external sources 4,518  6,610  11,128  2,901  5,355  8,256
Depreciation and amortization 1,529  33  1,562  1,347  19  1,366
Income before income taxes 20,205  2,163  22,368  7,809  1,829  9,638
Income tax expense (1) 4,291  865  5,156  1,336  732  2,068
Total assets 1,927,351  6,908  1,934,259  1,453,536  6,106  1,459,642
                  
(1) Calculated at statutory tax rate of 30.09% in 2019 and 2018 for the insurance services segment 

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