PSB Holding Corp. Reports First Quarter 2021 Results
PRESTON, Md., April 28, 2021 /PRNewswire/ -- PSB Holding Corp. (OTC:PSBP), the parent company of Provident State Bank, Inc. ("Provident"), reported net income of $1.21 million ($.79 per diluted common share) for the first quarter ended March 31, 2021, compared to $1.44 million ($.94 per diluted common share) for the fourth quarter 2020 and $940,000 ($.61 per diluted common share) for the first quarter 2020.
When comparing net income for the first quarter 2021 to the fourth quarter 2020, net income decreased $229,000 primarily as a result of a decrease in mortgage banking activity driven by increasing long-term rates during the first quarter 2021. Specifically, gain on sale of loans decreased $242,000 on a linked-quarter basis.
When comparing net income for the first quarter of 2021 to the first quarter of 2020, net income increased $274,000 or 29.1%. The increase was largely the result of earned net fees on loans originated under the Small Business Administration's Payroll Protection Program ("PPP"), which began in April 2020, an increase in average investment balances (including interest-bearing deposits and federal funds sold) and an increase in gain on sale of loans. These positive influences on net income were offset by pressure on the net interest margin. Amortized net fees on PPP loans for the first quarter 2021 totaled $667,000. Average investment balances increased from $71.58 million during the first quarter 2020 to $142.30 million during the first quarter 2021 with an average yield of 1.21% in first quarter 2021 compared to 2.15% in the first quarter 2020. Gain on sale of loans increased $97,000. The net interest margin declined from 3.70% during the first quarter 2020 to 3.42% during the first quarter 2021. The net interest margin, exclusive of amortized net fees on PPP loans, was 3.09% during the first quarter 2021. Average earning assets increased from $435.18 million in 2020 to $527.13 million, inclusive of average PPP loans of $41.41 million, in 2021. The increase in gain on sale of loans and the decline in the net interest margin were the result of a lower interest rate environment pursued by the Federal Reserve to stabilize the economy during the pandemic.
Assets totaled $571.7 million at March 31, 2021, increasing $22.4 million or 4.1% compared to December 31, 2020 and $109.2 million or 23.6% compared to March 31, 2020. Growth in assets was driven primarily by growth in deposits as government stimulus increased customer liquidity. Deposits totaled $473.7 million at March 31, 2021 compared to $449.4 million at December 31, 2020 and $367.1 million at March 31, 2020, representing growth of 5.4% and 29.1%, respectively. Gross loans decreased $3.1 million to $383.0 million, a 1.0% decrease as compared to December 31, 2020. Gross loans increased $22.1 million or 6.1% compared to March 31, 2020 primarily as a result of PPP loan origination activity. As of March 31, 2021, non-performing assets and past due loans were .34% of total assets.
President and Chief Executive Officer Melissa Quirk commented, "Performance continued to remain strong with our fourth consecutive quarter of earnings in excess of $1.1 million, a first for our company. Our strong performance during this period was the result of our proactive initiative to participate in the PPP and our ability to maintain core business activities during an unprecedented pandemic. We remain grateful for the commitment of our staff and the patience of our customers during this extraordinary time."
PSB Holding Corp. is the holding company of Provident State Bank, Inc., a full service financial institution serving the eastern shore of Maryland since 1904. Provident State Bank, Inc. has ten locations in Preston, Federalsburg, Ridgely, Denton, Easton-Elliot Road, Easton-Harrison Street, Secretary, Cambridge, Salisbury and Lewes (Delaware). For more information on PSB Holding Corp. and Provident State Bank, Inc., visit www.providentstatebank.com.
Forward-Looking Statements
Forward-looking statements relating to PSB Holding Corp. and its subsidiary, Provident State Bank, Inc. may include plans, strategies, objectives, expectations, intentions and adequacy of resources. All statements other than statements of historical fact, including, without limitation, statements regarding business strategy, future events, activities, performance, and plans and objectives for future operations, are forward-looking statements. Therefore, the illustrative value of forward-looking statements made in or pursuant to this press release should not, under any circumstances, be considered a guaranty or promise that such future events, activities, occurrences or performances will take place.
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
(unaudited) | (unaudited) | Percent Change from | ||||||||
Mar 31, 2021 | Dec 31, 2020 | Mar 31, 2020 | Dec 31, 2020 | Mar 31, 2020 | ||||||
Assets | ||||||||||
Cash and cash equivalents | $ 44,956,382 | $ 29,162,136 | $ 19,641,503 | 54.2% | 128.9% | |||||
Investment securities | 122,078,560 | 111,930,314 | 59,796,786 | 9.1% | 104.2% | |||||
Loans held for sale | 1,414,221 | 2,367,448 | 1,988,172 | -40.3% | -28.9% | |||||
Loans receivable | 383,048,584 | 386,189,190 | 360,979,154 | -0.8% | 6.1% | |||||
Less allowance for loan losses | 3,675,068 | 3,583,204 | 3,409,206 | 2.6% | 7.8% | |||||
Loans, net of allowance for loan losses | 379,373,516 | 382,605,986 | 357,569,948 | -0.8% | 6.1% | |||||
Property and equipment | 8,196,751 | 8,401,637 | 9,694,554 | -2.4% | -15.4% | |||||
Bank-owned life insurance | 8,712,098 | 8,656,454 | 8,471,644 | 0.6% | 2.8% | |||||
Lease assets | 2,443,106 | 2,508,345 | 2,675,508 | -2.6% | -8.7% | |||||
Accrued interest receivable | 1,484,262 | 1,616,775 | 1,314,693 | -8.2% | 12.9% | |||||
Other assets | 3,044,696 | 2,103,866 | 1,315,594 | 44.7% | 131.4% | |||||
Total assets | $ 571,703,592 | $ 549,352,961 | $ 462,468,402 | 4.1% | 23.6% | |||||
Liabilities and Stockholders' Equity | ||||||||||
Deposits: | ||||||||||
Noninterest-bearing | $ 210,026,953 | $ 171,855,568 | $ 139,853,993 | 22.2% | 50.2% | |||||
Interest-bearing | 263,682,755 | 277,526,516 | 227,202,014 | -5.0% | 16.1% | |||||
Total deposits | 473,709,708 | 449,382,084 | 367,056,007 | 5.4% | 29.1% | |||||
Repurchase agreements | 11,891,020 | 15,528,356 | 7,447,748 | -23.4% | 59.7% | |||||
FHLB advances and other borrowing | 32,801,481 | 31,078,123 | 38,907,389 | 5.5% | -15.7% | |||||
Lease liabilities | 2,639,068 | 2,685,641 | 2,839,341 | -1.7% | -7.1% | |||||
Other liabilities | 2,016,381 | 1,934,558 | 1,277,975 | 4.2% | 57.8% | |||||
Total liabilities | 523,057,658 | 500,608,762 | 417,528,460 | 4.5% | 25.3% | |||||
Stockholders' equity | 48,645,934 | 48,744,199 | 44,939,942 | -0.2% | 8.2% | |||||
Total liabilities and equity | $ 571,703,592 | $ 549,352,961 | $ 462,468,402 | 4.1% | 23.6% | |||||
Book value per common share | $ 31.76 | $ 31.82 | $ 29.34 | -0.2% | 8.2% | |||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||
(unaudited) | |||||||||||||
Three Months Ended | Percent Change from | ||||||||||||
Mar 31, 2021 | Dec 31,2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2020 | Mar 31, 2020 | |||||||
Interest income | |||||||||||||
Loans, including fee income | $ 4,763,112 | $ 4,988,220 | $ 4,796,814 | $ 4,758,983 | $ 4,591,832 | -4.5% | 3.7% | ||||||
Investment securities | 423,879 | 334,830 | 305,329 | 332,732 | 346,973 | 26.6% | 22.2% | ||||||
Other interest income | 6,144 | 10,291 | 7,190 | 5,014 | 38,468 | -40.3% | -84.0% | ||||||
Total interest income | 5,193,135 | 5,333,341 | 5,109,333 | 5,096,729 | 4,977,273 | -2.6% | 4.3% | ||||||
Interest expense | |||||||||||||
Deposits | 534,280 | 570,013 | 616,225 | 657,010 | 707,952 | -6.3% | -24.5% | ||||||
Repurchase agreements | 1,079 | 1,298 | 782 | 1,036 | 4,945 | -16.9% | -78.2% | ||||||
FHLB advances | 175,472 | 187,295 | 195,442 | 204,654 | 211,894 | -6.3% | -17.2% | ||||||
Other borrowings | 34,937 | 36,686 | 38,461 | 39,834 | 40,298 | -4.8% | -13.3% | ||||||
Total interest expense | 745,768 | 795,292 | 850,910 | 902,534 | 965,089 | -6.2% | -22.7% | ||||||
Net interest income | 4,447,367 | 4,538,049 | 4,258,423 | 4,194,195 | 4,012,184 | -2.0% | 10.8% | ||||||
Provision for loan losses | 90,000 | 20,000 | 130,000 | 180,000 | 118,500 | 350.0% | -24.1% | ||||||
Net interest income after provision | 4,357,367 | 4,518,049 | 4,128,423 | 4,014,195 | 3,893,684 | -3.6% | 11.9% | ||||||
Noninterest income | |||||||||||||
Service charges | 417,139 | 416,823 | 412,317 | 374,471 | 423,478 | 0.1% | -1.5% | ||||||
Gain on sale of loans | 260,464 | 502,302 | 397,309 | 243,830 | 163,444 | -48.1% | 59.4% | ||||||
Gain on sale of securities | - | 18,557 | - | 25,470 | - | -100.0% | NM | ||||||
Other noninterest income | 53,264 | 66,597 | 69,745 | 71,046 | 74,609 | -20.0% | -28.6% | ||||||
Total noninterest income | 730,867 | 1,004,279 | 879,371 | 714,817 | 661,531 | -27.2% | 10.5% | ||||||
Noninterest expense | |||||||||||||
Salaries and benefits | 1,808,276 | 1,905,737 | 1,843,439 | 1,706,479 | 1,771,823 | -5.1% | 2.1% | ||||||
Occupancy | 513,208 | 507,121 | 488,246 | 492,731 | 521,550 | 1.2% | -1.6% | ||||||
Data processing and software | 312,620 | 294,390 | 287,995 | 268,884 | 234,771 | 6.2% | 33.2% | ||||||
Other noninterest expense | 839,505 | 894,306 | 715,565 | 746,696 | 783,748 | -6.1% | 7.1% | ||||||
Total noninterest expense | 3,473,609 | 3,601,554 | 3,335,245 | 3,214,790 | 3,311,892 | -3.6% | 4.9% | ||||||
Net income before tax | 1,614,625 | 1,920,774 | 1,672,549 | 1,514,222 | 1,243,323 | -15.9% | 29.9% | ||||||
Tax expense | 401,375 | 478,399 | 420,666 | 376,544 | 303,494 | -16.1% | 32.3% | ||||||
Net income | $1,213,250 | $ 1,442,375 | $ 1,251,883 | $ 1,137,678 | $ 939,829 | -15.9% | 29.1% | ||||||
Net income per share | $ 0.79 | $ 0.94 | $ 0.82 | $ 0.74 | $ 0.61 | -15.9% | 29.1% | ||||||
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SOURCE PSB Holding Corp.