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InsCorp Reports Quarterly Profit Increase as Healthcare Brand Grows. Nashville-based Lender Resumes and Increases Dividend After Pandemic Pause

NASHVILLE, Tenn., May 7, 2021 /PRNewswire/ -- InsCorp, parent company to INSBANK (OTCQX: IBTN), today reported first quarter earnings of $1,290,000, or $0.44 per common share. This represents an increase of $482,000, or 60%, over the previous quarter, and a $557,000 increase over the same quarter the prior year. Factors contributing to the results included core loan growth; PPP loan fee income; decreased funding costs; and income recognized from interest rate hedges. "Our team members have been purposeful throughout the pandemic, allocating resources to pandemic-driven matters such as industry-specific credit challenges, PPP loans, and the Fed's zero interest rate policy, while concurrently executing innovation strategies in a rapidly-changing, technology-driven economy," said Jim Rieniets, President & CEO of INSBANK. "In the midst of the pandemic we launched our niche healthcare brand, Medquity, to promote a national presence for physician-focused lending programs that already serve clients in 15 states. Medquity offers a unique blend of industry expertise in commercial banking as well as web-driven products serving the needs of medical professionals," Rieniets continued.  Steady growth of the bank's diverse healthcare portfolio in recent years now accounts for 25% of all loans. 

Net interest income was $4,444,000 for the quarter, representing a 14 percent increase over the same period for prior year, while quarterly operating expenses of $2,729,0000 were just 2% higher than those of the prior year. Loan loss provision expense was $650,000, which was $350,000 higher than the prior year period. "Our team's depth of knowledge of our borrowers and diligence in monitoring our loan portfolio during the pandemic finds us cautiously optimistic that our loan loss reserves will provide a sufficient buffer against anticipated losses," said Jim Rieniets. "Now a year into the pandemic we expect losses in just a few credits, for which there is little concentration within a particular industry. In general, most of our affected borrowers have navigated adversity and are reporting revenue gains this spring."    

Additionally, InsCorp's board of directors recently voted to distribute a semi-annual dividend of $0.12 per share, after having suspended dividend payments during 2020. "A year ago we felt the prudent course of action was to preserve capital given the level of uncertainty surrounding the pandemic, said Michael Qualls, Chairman of InsCorp. "Recent months, however, have provided greater clarity both for our company and the industry and we're pleased to restore and increase our dividend based on current and projected operations," Qualls continued. InsCorp's dividend will be distributed on June 11th, 2021 and payable to shareholders of record as of May 21st, 2021.

Highlights of the quarter included:

  • Modified loans, due to the pandemic, represent 12% of the loan portfolio at March 31, 2021, with 50% being on payment deferral and 50% interest only. Total deferments are $69 million.
  • Payment deferrals are primarily in the restaurant, bar and tour/coach services industries, while the interest only modifications were in the hospitality and tour/coach services industries. 76% of total deferments were secured by real estate.
  • Loans generated through the government's SBA-PPP program Round 2 totaled $16.8 million through March 31, 2021.
  • Deferred loan fees related to the PPP loans is approximately $930,000 at March 31, 2021.
  • Non-performing assets to total loans and OREO were 1.9% at March 31, 2021, compared to 0.68% at March 31, 2020.
  • Yield on loans was 4.19% for the three months ended March 31, 2021 compared to 4.88% for the same period in 2020.
  • Cost of all interest-bearing funding was 1.05% for the three months ended March 31, 2021 decreasing from 1.93% for the same period in 2020.
  • Efficiency ratio was 50.7% at March 31, 2021, comparing favorably to the bank's FDIC peer group average of 60.7%.
  • Non-Interest Expense to Total Assets was 1.70% for the three months ended March 31, 2021, slightly lower than 1.85% for the same period in 2020 and compared favorably to the bank's FDIC peer group average of 2.42%.
  • Assets per employee remained strong at $13.22 million, compared to the FDIC peer group of $6.59 million.
  • The allowance for loan and lease losses was 1.38%, slightly higher than the bank's FDIC peer group average of 1.37%.
  • Annualized return on tangible common equity for the first quarter was 10.03%
  • Tangible book value increased $0.41 to $17.69 during the quarter primarily by virtue of retained earnings.
  • The bank's tier 1 capital ratio was 11.9%, while total risk-based capital was 13.2%.

About INSBANK 

Since 2000, INSBANK has offered its clients highly personalized service provided by experienced relationship managers, while positioning itself as an innovator, utilizing technologies to deliver those services efficiently and conveniently.  In addition to its commercial focused operation, INSBANK operates three divisions, Medquity, TMA Medical Banking and INSBANK Online.  Medquity offers healthcare banking solutions to individuals nationwide, whether they are still in residency, practicing or entering retirement, while TMA Medical Banking provides banking services specifically to members of the Tennessee Medical Association. INSBANK Online offers nationally available virtual private client services for interest bearing deposits.  INSBANK is owned by InsCorp, Inc., a Tennessee bank holding company. The bank is headquartered in Nashville at 2106 Crestmoor Road, and has an office in Brentwood at 5614 Franklin Pike Circle. For more information, please visit www.insbanktn.com

 

InsCorp, Inc.

Consolidated Balance Sheets

(000's)

(unaudited)



















March 31,



December 31,



March 31,





2021



2020



2020

Assets











Cash and Cash Equivalents

$                            15,561



$                                8,219



$                              2,521

Interest Bearing Deposits

32,268



33,356



38,209

Securities

12,747



17,039



25,402















Loans

543,178



525,235



464,736

  Allowance for Loan Losses

(7,515)



(7,365)



(5,680)

Net Loans

535,663



517,870



459,056















Premises and Equipment, net

13,519



13,630



13,894

Bank Owned Life Insurance

10,176



10,115



9,927

Restricted Equity Securities

8,147



7,612



6,119

Goodwill and Related Intangibles, net

1,091



1,091



1,091

Other Assets

7,549



8,298



6,721















  Total Assets

$                          636,721



$                           617,230



$                          562,940















Liabilities and Shareholders' Equity











Liabilities











  Deposits













Non-interest-bearing

$                            72,858



$                             52,665



$                            42,576



Interest-bearing

432,295



417,731



399,199



Total Deposits

505,153



470,396



441,775















  Federal Home Loan Bank Advances

45,000



50,000



51,000

  Paycheck Protection Program Liquidity Fund

15,485



18,412



-

  Subordinated Debentures

15,000



15,000



15,000

  Federal Funds Purchased

-



7,000



-

  Other Liabilities

3,117



5,328



5,475

Total Liabilities

583,755



566,136



513,250















Shareholders' Equity













Common Stock

31,325



31,190



30,773



Treasury Stock

(681)



(681)







Accumulated Retained Earnings

21,652



20,377



18,677



Accumulated Other Comprehensive Income

670



208



240



Total Stockholders' Equity

52,966



51,094



49,690

Total Liabilities & Shareholders' Equity

$                          636,721



$                           617,230



$                          562,940















Tangible Book Value

$                              17.69



$                                17.28



$                              16.64





















































































InsCorp, Inc.

Consolidated Statements of Income

(000's)

(Unaudited)



















Three Months Ended



Twelve Months Ended



Three Months Ended





March 31, 2021



December 31, 2020



March 31, 2020















Interest Income

$                      5,876



$                             22,694



$                              6,018

Interest Expense

1,431



7,221



2,125

Net Interest Income

4,445



15,473



3,893

Provision for Loan Losses

650



2,400



300

Non-Interest Income













Service Charges on Deposit Accounts

59



212



56



Bank Owned Life Insurance

60



251



62



Gain on Interest Rate Hedges and Security Sales

505



-



-



Other

237



705



175

Non-Interest Expense













Salaries and Benefits

1,654



6,200



1,629



Occupancy and equipment

325



1,233



295



Data Processing

147



553



138



Marketing and Advertising

100



349



91



Other

503



1,843



513

Net income from Operations

1,927



4,063



1,220















Interest Expense-Subordinated Debt

239



956



239

Income Before Income Taxes

1,688



3,107



981

Income Tax Expense

(398)



(674)



(248)

Net Income

$                              1,290



$                                2,433



$                                  733















Return on Weighted Average Common Shares

$                                 0.44



$                                  0.83



$                                 0.25

 

 

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SOURCE INSBANK