Northeast Bank (the “Bank”) (NASDAQ: NBN), a Maine-based
full-service bank, today reported net income of $11.3 million, or
$1.54 per diluted common share, for the quarter ended December 31,
2022, compared to net income of $11.4 million, or $1.42 per diluted
common share, for the quarter ended December 31, 2021. Net income
for the six months ended December 31, 2022 was $19.6 million, or
$2.65 per diluted common share, compared to $21.3 million, or $2.63
per diluted common share, for the six months ended December 31,
2021. Net income per diluted common share excluding correspondent
fee income would be $1.48 and $0.90 for the three months ended
December 31, 2022 and 2021, respectively, and $2.46 and $1.43 for
the six months ended December 31, 2022 and 2021, respectively.
The Board of Directors declared a cash dividend of $0.01 per
share, payable on February 23, 2023, to shareholders of record as
of February 9, 2023.
“Our second fiscal quarter represented a milestone for Northeast
Bank,” said Rick Wayne, Chief Executive Officer. “Our National
Lending Division generated a record $1.17 billion in purchases and
originations for the quarter, growing the National Lending
portfolio by $1.04 billion, or 74.4%, over September 30, 2022, and
$1.21 billion, or 97.9%, over June 30, 2022. Our disciplined
approach proved valuable, as we were able to deploy significant
capital into purchased loans, poising the Bank for future success.
The originated yield and purchased return for the quarter was 8.5%
and 8.7%, respectively. Additionally, we approved and initiated an
at-the-market offering of up to $50.0 million of our voting common
stock, which provides the Bank with the ability to raise capital if
and as needed. For the quarter, we earned $1.54 per diluted common
share, a return on average equity of 17.5%, and a return on average
assets of 2.1%.”
As of December 31, 2022, total assets were $2.81 billion, an
increase of $1.23 billion, or 77.5%, from total assets of $1.58
billion as of June 30, 2022. The principal components of the
changes in the balance sheet follow:
1. The following table highlights the changes in the loan
portfolio for the three and six months ended December 31, 2022:
|
Loan Portfolio Changes |
|
Three Months Ended December 31, 2022 |
|
December 31, 2022Balance |
|
September 30, 2022Balance |
|
Change ($) |
|
Change (%) |
|
(Dollars in thousands) |
|
National Lending Purchased |
$ |
1,483,567 |
|
|
$ |
530,393 |
|
|
$ |
953,174 |
|
|
179.71 |
% |
National Lending
Originated |
|
963,775 |
|
|
|
873,292 |
|
|
|
90,483 |
|
|
10.36 |
% |
SBA
National |
|
27,239 |
|
|
|
27,636 |
|
|
|
(397 |
) |
|
(1.44 |
%) |
Community Banking |
|
30,176 |
|
|
|
32,899 |
|
|
|
(2,723 |
) |
|
(8.28 |
%) |
Total |
$ |
2,504,757 |
|
|
$ |
1,464,220 |
|
|
$ |
1,040,537 |
|
|
71.06 |
% |
|
Six Months Ended December 31, 2022 |
|
December 31, 2022Balance |
|
June 30, 2022Balance |
|
Change ($) |
|
Change (%) |
|
(Dollars in thousands) |
National Lending Purchased |
$ |
1,483,567 |
|
|
$ |
477,682 |
|
|
$ |
1,005,885 |
|
|
210.58 |
% |
National Lending
Originated |
|
963,775 |
|
|
|
759,229 |
|
|
|
204,546 |
|
|
26.94 |
% |
SBA
National |
|
27,239 |
|
|
|
33,046 |
|
|
|
(5,807 |
) |
|
(17.57 |
%) |
Community Banking |
|
30,176 |
|
|
|
34,909 |
|
|
|
(4,733 |
) |
|
(13.56 |
%) |
Total |
$ |
2,504,757 |
|
|
$ |
1,304,866 |
|
|
$ |
1,199,891 |
|
|
91.96 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans generated by the Bank's National Lending Division for the
quarter ended December 31, 2022 totaled $1.17 billion, which
consisted of $998.5 million of purchased loans, at an average price
of 86.6% of unpaid principal balance, and $174.0 million of
originated loans.
An overview of the Bank’s National Lending
portfolio follows:
|
National Lending Portfolio |
|
Three Months Ended December 31, |
|
2022 |
|
2021 |
|
Purchased |
|
Originated |
|
Total |
|
Purchased |
|
Originated |
|
Total |
|
(Dollars in thousands) |
|
Loans purchased or originated during the period: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unpaid principal balance |
$ |
1,152,957 |
|
|
$ |
173,992 |
|
|
$ |
1,326,949 |
|
|
$ |
93,379 |
|
|
$ |
168,398 |
|
|
$ |
261,777 |
|
Net investment basis |
|
998,527 |
|
|
|
173,992 |
|
|
|
1,172,519 |
|
|
|
92,136 |
|
|
|
168,398 |
|
|
|
260,534 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Returns on loan portfolio
during the period: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yield |
|
8.69 |
% |
|
|
8.50 |
% |
|
|
8.59 |
% |
|
|
8.92 |
% |
|
|
6.48 |
% |
|
|
7.53 |
% |
|
Six Months Ended December 31, |
|
2022 |
|
2021 |
|
Purchased |
|
Originated |
|
Total |
|
Purchased |
|
Originated |
|
Total |
|
(Dollars in thousands) |
Loans purchased or originated
during the period: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unpaid principal balance |
$ |
1,236,815 |
|
|
$ |
355,712 |
|
|
$ |
1,592,527 |
|
|
$ |
130,413 |
|
|
$ |
262,884 |
|
|
$ |
393,297 |
|
Net investment basis |
|
1,076,064 |
|
|
|
355,712 |
|
|
|
1,431,776 |
|
|
|
127,492 |
|
|
|
262,884 |
|
|
|
390,376 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Returns on loan portfolio
during the period: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yield |
|
8.07 |
% |
|
|
8.19 |
% |
|
|
8.14 |
% |
|
|
9.08 |
% |
|
|
6.43 |
% |
|
|
7.58 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans as of period
end: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unpaid principal balance |
$ |
1,673,158 |
|
|
$ |
963,775 |
|
|
$ |
2,636,933 |
|
|
$ |
518,175 |
|
|
$ |
619,223 |
|
|
$ |
1,137,398 |
|
Net investment basis |
|
1,483,567 |
|
|
|
963,775 |
|
|
|
2,447,342 |
|
|
|
484,513 |
|
|
|
619,223 |
|
|
|
1,103,736 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2. Deposits increased by $947.7 million, or 73.6%, from June 30,
2022, attributable to increases in time deposits of $951.1 million,
or 747.1%, and savings and interest-bearing checking accounts of
$140.1 million, or 23.9%, partially offset by a decrease in demand
deposits of $145.5 million, or 44.2%. The significant increase in
time deposits is primarily due to the increase in brokered time
deposits, which increased to $843.3 million compared to none
outstanding at June 30, 2022. The use of brokered time deposits was
part of the Bank’s strategy to fund the loan purchases for the
short-term.
3. Shareholders’ equity increased by $15.1 million, or 6.1%,
from June 30, 2022, primarily due to net income of $19.6 million,
stock-based compensation of $1.7 million and the issuance of 34
thousand shares of voting common stock, adding $1.1 million to
shareholders’ equity, net of issuance costs, partially offset by
the repurchase of 136 thousand shares of voting common stock at a
weighted average price per share of $37.99, which resulted in a
$5.2 million decrease in shareholders’ equity.
Net income decreased by $105 thousand to $11.3 million for the
quarter ended December 31, 2022, compared to net income of $11.4
million for the quarter ended December 31, 2021.
1. Net interest and dividend income before provision for loan
losses increased by $8.7 million to $28.8 million for the quarter
ended December 31, 2022, compared to $20.1 million for the quarter
ended December 31, 2021. The increase was primarily due to the
following:
- An increase in interest income earned on loans of $16.0
million, primarily due to an increase in interest income earned on
the National Lending Division’s originated and purchased
portfolios, due to higher average balances in both portfolios and
higher rates earned on the originated portfolio, partially offset
by lower rates earned on the purchased portfolio; and
- An increase in interest income earned on short-term investments
of $1.6 million, due to higher rates earned, partially offset by
lower average balances; partially offset by,
- An increase in deposit interest expense of $8.7 million, due to
higher interest rates and higher average balances in
interest-bearing deposits; and
- An increase in FHLB borrowings interest expense of $411
thousand, due to higher average balances.
The following table summarizes interest income and related
yields recognized on the loan portfolios:
|
Interest Income and Yield on Loans |
|
Three Months Ended December 31, |
|
2022 |
|
2021 |
|
Average |
|
Interest |
|
|
|
Average |
|
Interest |
|
|
|
Balance |
|
Income |
|
Yield |
|
Balance |
|
Income |
|
Yield |
|
(Dollars in thousands) |
Community Banking |
$ |
30,920 |
|
|
$ |
586 |
|
|
7.52 |
% |
|
$ |
42,728 |
|
|
$ |
556 |
|
|
5.16 |
% |
SBA National |
|
27,757 |
|
|
|
610 |
|
|
8.72 |
% |
|
|
36,027 |
|
|
|
635 |
|
|
6.99 |
% |
SBA PPP |
|
- |
|
|
|
- |
|
|
0.00 |
% |
|
|
628 |
|
|
|
2 |
|
|
1.26 |
% |
National Lending: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originated |
|
899,562 |
|
|
|
19,274 |
|
|
8.50 |
% |
|
|
601,394 |
|
|
|
9,827 |
|
|
6.48 |
% |
Purchased |
|
765,085 |
|
|
|
16,758 |
|
|
8.69 |
% |
|
|
452,644 |
|
|
|
10,175 |
|
|
8.92 |
% |
Total National Lending |
|
1,664,647 |
|
|
|
36,032 |
|
|
8.59 |
% |
|
|
1,054,038 |
|
|
|
20,002 |
|
|
7.53 |
% |
Total |
$ |
1,723,324 |
|
|
$ |
37,228 |
|
|
8.57 |
% |
|
$ |
1,133,421 |
|
|
$ |
21,195 |
|
|
7.42 |
% |
|
|
|
Six Months Ended December 31, |
|
2022 |
|
2021 |
|
Average |
|
Interest |
|
|
|
Average |
|
Interest |
|
|
|
Balance |
|
Income |
|
Yield |
|
Balance |
|
Income |
|
Yield |
|
(Dollars in thousands) |
Community Banking |
$ |
31,904 |
|
|
$ |
1,052 |
|
|
6.54 |
% |
|
$ |
43,383 |
|
|
$ |
1,131 |
|
|
5.17 |
% |
SBA National |
|
29,267 |
|
|
|
1,340 |
|
|
9.08 |
% |
|
|
38,168 |
|
|
|
1,271 |
|
|
6.61 |
% |
SBA PPP |
|
- |
|
|
|
- |
|
|
0.00 |
% |
|
|
1,006 |
|
|
|
13 |
|
|
2.56 |
% |
National Lending: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originated |
|
857,775 |
|
|
|
35,425 |
|
|
8.19 |
% |
|
|
574,343 |
|
|
|
18,612 |
|
|
6.43 |
% |
Purchased |
|
626,552 |
|
|
|
25,490 |
|
|
8.07 |
% |
|
|
440,224 |
|
|
|
20,161 |
|
|
9.08 |
% |
Total National Lending |
|
1,484,327 |
|
|
|
60,915 |
|
|
8.14 |
% |
|
|
1,014,567 |
|
|
|
38,773 |
|
|
7.58 |
% |
Total |
$ |
1,545,498 |
|
|
$ |
63,307 |
|
|
8.13 |
% |
|
$ |
1,097,124 |
|
|
$ |
41,188 |
|
|
7.45 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The components of total income on purchased loans are set forth
in the table below entitled “Total Return on Purchased Loans.” When
compared to the quarter ended December 31, 2021, regularly
scheduled interest and accretion for the quarter ended December 31,
2022 increased by $5.4 million due to the increase in average
balances and transactional income increased by $1.1 million. The
total return on purchased loans for the quarter ended December 31,
2022 was 8.7%, a decrease from 9.0% for the quarter ended December
31, 2021. The following table details the total return on purchased
loans:
|
Total Return on Purchased Loans |
|
Three Months Ended December 31, |
|
2022 |
|
2021 |
|
Income |
|
Return (1) |
|
Income |
|
Return (1) |
|
(Dollars in thousands) |
Regularly scheduled interest and accretion |
$ |
13,014 |
|
|
6.75 |
% |
|
$ |
7,576 |
|
|
6.64 |
% |
Transactional income: |
|
|
|
|
|
|
|
|
|
|
|
|
Gain on real estate owned |
|
- |
|
|
0.00 |
% |
|
|
49 |
|
|
0.04 |
% |
Accelerated accretion and loan fees |
|
3,744 |
|
|
1.94 |
% |
|
|
2,599 |
|
|
2.28 |
% |
Total transactional income |
|
3,744 |
|
|
1.94 |
% |
|
|
2,648 |
|
|
2.32 |
% |
Total |
$ |
16,758 |
|
|
8.69 |
% |
|
$ |
10,224 |
|
|
8.96 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended December 31, |
|
2022 |
|
2021 |
|
Income |
|
Return (1) |
|
Income |
|
Return (1) |
|
(Dollars in thousands) |
Regularly scheduled interest
and accretion |
$ |
20,688 |
|
|
6.55 |
% |
|
$ |
14,557 |
|
|
6.56 |
% |
Transactional income: |
|
|
|
|
|
|
|
|
|
|
|
Loss on real estate owned |
|
- |
|
|
0.00 |
% |
|
|
(25 |
) |
|
(0.01 |
%) |
Accelerated accretion and loan fees |
|
4,802 |
|
|
1.52 |
% |
|
|
5,604 |
|
|
2.52 |
% |
Total transactional income |
|
4,802 |
|
|
1.52 |
% |
|
|
5,579 |
|
|
2.51 |
% |
Total |
$ |
25,490 |
|
|
8.07 |
% |
|
$ |
20,136 |
|
|
9.07 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The total return on purchased loans represents scheduled
accretion, accelerated accretion, gains on asset sales and gains on
real estate owned recorded during the period divided by the average
invested balance, which includes purchased loans held for sale, on
an annualized basis. The total return does not include the effect
of purchased loan charge-offs or recoveries in the quarter. Total
return is considered a non-GAAP financial measure.
2. Provision (credit) for loan losses increased by $1.4 million
to a provision of $325 thousand for the quarter ended December 31,
2022, from a credit of $1.1 million for the quarter ended December
31, 2021. The increase in the provision (credit) for loan losses
reflects increases in the loan portfolio and increases in specific
reserves during the quarter ended December 31, 2022, as compared to
decreases in certain qualitative factors as a result of continued
improvements relative to the COVID-19 pandemic and decreases in
specific reserves during the quarter ended December 31, 2021.
3. Noninterest income decreased by $5.2 million for the quarter
ended December 31, 2022, compared to the quarter ended December 31,
2021, primarily due to the following:
- A decrease in correspondent fee income of $5.4 million from the
recognition of correspondent fees and net servicing income.
Correspondent income for the quarters ended December 31, 2022 and
2021 is comprised of the following components:
|
Three Months Ended December 31, |
|
|
2022 |
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
(In thousands) |
Correspondent Fee |
$ |
29 |
|
|
$ |
1,087 |
|
Amortization of Purchased
Accrued Interest |
|
275 |
|
|
|
1,614 |
|
Earned Net Servicing
Interest |
|
314 |
|
|
|
3,340 |
|
Total |
$ |
618 |
|
|
$ |
6,041 |
|
|
|
|
|
|
|
|
|
The Bank has $491 thousand of unamortized correspondent fee and
purchased accrued interest remaining. This decrease was offset
by:
- An increase in fees for other customers of $199 thousand,
primarily due to increased commercial loan servicing fees during
the quarter ended December 31, 2022.
4. Noninterest expense increased by $2.5 million for the quarter
ended December 31, 2022 compared to the quarter ended December 31,
2021, primarily due to the following:
- An increase in salaries and employee benefits expense of $1.0
million, primarily due to increases in regular employee
compensation, stock compensation, and bonus expense;
- An increase in loan expense of $538 thousand, due to an
increase in correspondent expense;
- An increase in occupancy and equipment expense of $336
thousand, primarily due to expenses associated with the new lease
of office space in Boston, Massachusetts; and
- An increase in other noninterest expense of $325 thousand,
primarily due to an increase in deposit expense of $179 thousand,
primarily from increased excess deposit insurance costs and debit
card expense, and an increase in meals and entertainment expense of
$142 thousand.
5. Income tax expense decreased by $301 thousand to $4.7
million, or an effective tax rate of 29.5%, for the quarter ended
December 31, 2022, compared to $5.0 million, or an effective tax
rate of 30.6%, for the quarter ended December 31, 2021. The
decrease was primarily due to lower pre-tax income, which decreased
by $406 thousand during the quarter ended December 31, 2022
compared to the quarter ended December 31, 2021. The decrease in
effective tax rate was primarily due to $673 thousand of tax
benefits arising from the exercise of stock options and restricted
stock vests during the quarter ended December 31, 2022, as compared
to only $44 thousand of tax benefits in the quarter ended December
31, 2021, which reduced the effective tax rate from 33.7% to
29.5%.
As of December 31, 2022, nonperforming assets totaled $12.9
million, or 0.46% of total assets, as compared to $12.9 million, or
0.82% of total assets, as of June 30, 2022.
As of December 31, 2022, past due loans totaled $18.5 million,
or 0.74% of total loans, as compared to past due loans totaling
$7.0 million, or 0.53% of total loans as of June 30, 2022. The
increase was primarily due to twenty-three National Lending
Division purchased loans totaling $11.5 million that were past due
at December 31, 2022 but not at June 30, 2022.
As of December 31, 2022, the Bank’s Tier 1 leverage capital
ratio was 12.5%, compared to 16.1% at June 30, 2022, and the Total
capital ratio was 11.1% at December 31, 2022, compared to 19.5% at
June 30, 2022. Capital ratios were primarily affected by increased
earnings and increased assets, primarily loans.
Investor Call InformationRick Wayne, Chief
Executive Officer, Jean-Pierre Lapointe, Chief Financial Officer,
and Pat Dignan, Executive Vice President and Chief Operating
Officer, will host a conference call to discuss second
quarter earnings and business outlook at 10:00 a.m. Eastern Time on
Thursday, January 26th.
To access the conference call by phone, please go to this link
(Phone Registration), and you will be provided with dial in
details. The call will be available via live webcast, which can be
viewed by accessing the Bank’s website at www.northeastbank.com and
clicking on the About Us - Investor Relations section. To listen to
the webcast, attendees are encouraged to visit the website at least
fifteen minutes early to register, download and install any
necessary audio software. Please note there will also be a slide
presentation that will accompany the webcast. For those who cannot
listen to the live broadcast, a replay will be available online for
one year at www.northeastbank.com.
About Northeast BankNortheast Bank (NASDAQ:
NBN) is a full-service bank headquartered in Portland, Maine. We
offer personal and business banking services to the Maine market
via seven banking centers. Our National Lending Division purchases
and originates commercial loans on a nationwide basis. ableBanking,
a division of Northeast Bank, offers online savings products to
consumers nationwide. Information regarding Northeast Bank can be
found at www.northeastbank.com.
Non-GAAP Financial MeasuresIn addition to
results presented in accordance with generally accepted accounting
principles (“GAAP”), this press release contains certain non-GAAP
financial measures, including tangible common shareholders’ equity,
tangible book value per share, total return on purchased loans,
efficiency ratio, and net interest margin excluding collection
account. The Bank’s management believes that the supplemental
non-GAAP information is utilized by regulators and market analysts
to evaluate a company’s financial condition and therefore, such
information is useful to investors. These disclosures should not be
viewed as a substitute for financial results determined in
accordance with GAAP, nor are they necessarily comparable to
non-GAAP performance measures that may be presented by other
companies. Because non-GAAP financial measures are not
standardized, it may not be possible to compare these financial
measures with other companies’ non-GAAP financial measures having
the same or similar names.
Forward-Looking Statements Statements in this
press release that are not historical facts are forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended, and are intended to be covered by the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995. We may also make forward-looking statements in other
documents we file with the Federal Deposit Insurance Corporation
(the “FDIC”), in our annual reports to our shareholders, in press
releases and other written materials, and in oral statements made
by our officers, directors or employees. You can identify
forward-looking statements by the use of the words “believe,”
“expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,”
“will,” “should,” and other expressions that predict or indicate
future events and trends and which do not relate to historical
matters. Although the Bank believes that these forward-looking
statements are based on reasonable estimates and assumptions, they
are not guarantees of future performance and are subject to known
and unknown risks, uncertainties, and other factors. You should not
place undue reliance on our forward-looking statements. You should
exercise caution in interpreting and relying on forward-looking
statements because they are subject to significant risks,
uncertainties and other factors which are, in some cases, beyond
the Bank’s control. The Bank’s actual results could differ
materially from those projected in the forward-looking statements
as a result of, among other factors, changes in general business
and economic conditions on a national basis and in the local
markets in which the Bank operates, including changes which
adversely affect borrowers’ ability to service and repay our loans;
changes in customer behavior due to political, business and
economic conditions, including inflation; turbulence in the capital
and debt markets; reductions in net interest income resulting from
interest rate volatility as well as changes in the balances and mix
of loans and deposits; changes in interest rates and real estate
values; changes in loan collectability, increases in defaults and
charge-off rates; decreases in the value of securities and other
assets, adequacy of loan loss reserves, or deposit levels
necessitating increased borrowing to fund loans and investments;
changing government regulation; competitive pressures from other
financial institutions; changes in legislation or regulation and
accounting principles, policies and guidelines; cybersecurity
incidents, fraud, natural disasters, the ongoing COVID-19 pandemic
and future pandemics; the risk that the Bank may not be successful
in the implementation of its business strategy; the risk that
intangibles recorded in the Bank’s financial statements will become
impaired; reputational risk relating to our participation in the
Paycheck Protection Program and other pandemic-related legislative
and regulatory initiatives and programs; changes in assumptions
used in making such forward-looking statements; and the other risks
and uncertainties detailed in the Bank’s Annual Report on Form 10-K
and updated by our Quarterly Reports on Form 10-Q and other filings
submitted to the FDIC. These statements speak only as of the date
of this release and the Bank does not undertake any obligation to
update or revise any of these forward-looking statements to reflect
events or circumstances occurring after the date of this
communication or to reflect the occurrence of unanticipated
events.
NBN-F
NORTHEAST
BANK |
BALANCE
SHEETS |
(Unaudited) |
(Dollars in
thousands, except share and per share data) |
|
|
December 31, 2022 |
|
June 30, 2022 |
Assets |
|
|
|
|
|
Cash and due from banks |
$ |
2,540 |
|
|
$ |
2,095 |
|
Short-term investments |
|
161,776 |
|
|
|
169,984 |
|
Total cash and cash equivalents |
|
164,316 |
|
|
|
172,079 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale debt
securities, at fair value |
|
53,698 |
|
|
|
54,911 |
|
Equity securities, at fair
value |
|
6,665 |
|
|
|
6,798 |
|
Total investment securities |
|
60,363 |
|
|
|
61,709 |
|
|
|
|
|
|
|
Loans: |
|
|
|
|
|
Commercial real estate |
|
1,939,151 |
|
|
|
882,187 |
|
Commercial and industrial |
|
479,215 |
|
|
|
352,729 |
|
Residential real estate |
|
85,782 |
|
|
|
69,209 |
|
Consumer |
|
609 |
|
|
|
741 |
|
Total loans |
|
2,504,757 |
|
|
|
1,304,866 |
|
Less: Allowance for loan losses |
|
6,411 |
|
|
|
5,028 |
|
Loans, net |
|
2,498,346 |
|
|
|
1,299,838 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Premises and equipment,
net |
|
27,333 |
|
|
|
9,606 |
|
Federal Home Loan Bank stock,
at cost |
|
11,481 |
|
|
|
1,610 |
|
Loan servicing rights,
net |
|
1,860 |
|
|
|
1,285 |
|
Bank-owned life insurance |
|
18,141 |
|
|
|
17,922 |
|
Other assets |
|
27,577 |
|
|
|
18,710 |
|
Total assets |
$ |
2,809,417 |
|
|
$ |
1,582,759 |
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
Deposits: |
|
|
|
|
|
Demand |
$ |
183,485 |
|
|
$ |
329,007 |
|
Savings and interest checking |
|
725,356 |
|
|
|
585,274 |
|
Money market |
|
248,129 |
|
|
|
246,095 |
|
Time |
|
1,078,439 |
|
|
|
127,317 |
|
Total deposits |
|
2,235,409 |
|
|
|
1,287,693 |
|
|
|
|
|
|
|
Federal Home Loan Bank
advances |
|
260,000 |
|
|
|
15,000 |
|
Lease liability |
|
20,903 |
|
|
|
4,451 |
|
Other liabilities |
|
29,678 |
|
|
|
27,294 |
|
Total liabilities |
|
2,545,990 |
|
|
|
1,334,438 |
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
|
Preferred stock, $1.00 par
value, 1,000,000 shares authorized; no shares issued and
outstanding at December 31, 2022 and June 30, 2022 |
|
- |
|
|
|
- |
|
Voting common stock, $1.00 par
value, 25,000,000 shares authorized; 7,511,044 and 7,442,103 shares
issued and outstanding at December 31, 2022 and June 30, 2022,
respectively |
|
7,511 |
|
|
|
7,442 |
|
Non-voting common
stock, $1.00 par value, 3,000,000 shares authorized; no shares
issued and outstanding at December 31, 2022 and June 30, 2022 |
- |
|
|
|
- |
|
Additional paid-in
capital |
|
34,423 |
|
|
|
38,749 |
|
Retained earnings |
|
222,417 |
|
|
|
202,980 |
|
Accumulated other
comprehensive loss |
|
(924 |
) |
|
|
(850 |
) |
Total shareholders' equity |
|
263,427 |
|
|
|
248,321 |
|
Total liabilities and shareholders' equity |
$ |
2,809,417 |
|
|
$ |
1,582,759 |
|
|
|
|
|
|
|
|
|
NORTHEAST
BANK |
STATEMENTS
OF INCOME |
(Unaudited) |
(Dollars in
thousands, except share and per share data) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Interest and dividend
income: |
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on loans |
$ |
37,228 |
|
|
$ |
21,195 |
|
|
$ |
63,307 |
|
|
$ |
41,188 |
|
Interest on available-for-sale securities |
|
270 |
|
|
|
76 |
|
|
|
419 |
|
|
|
170 |
|
Other interest and dividend income |
|
1,703 |
|
|
|
118 |
|
|
|
2,339 |
|
|
|
292 |
|
Total interest and dividend income |
|
39,201 |
|
|
|
21,389 |
|
|
|
66,065 |
|
|
|
41,650 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
9,896 |
|
|
|
1,184 |
|
|
|
12,698 |
|
|
|
2,492 |
|
Federal Home Loan Bank advances |
|
538 |
|
|
|
127 |
|
|
|
933 |
|
|
|
255 |
|
Obligation under capital lease agreements |
|
15 |
|
|
|
23 |
|
|
|
33 |
|
|
|
49 |
|
Total interest expense |
|
10,449 |
|
|
|
1,334 |
|
|
|
13,664 |
|
|
|
2,796 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest and dividend
income before provision for loan losses |
|
28,752 |
|
|
|
20,055 |
|
|
|
52,401 |
|
|
|
38,854 |
|
Provision (credit) for loan
losses |
|
325 |
|
|
|
(1,069 |
) |
|
|
1,175 |
|
|
|
(1,295 |
) |
Net interest and dividend
income after provision for loan losses |
|
28,427 |
|
|
|
21,124 |
|
|
|
51,226 |
|
|
|
40,149 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
|
Fees for other services to customers |
|
503 |
|
|
|
304 |
|
|
|
770 |
|
|
|
761 |
|
Gain on sales of SBA loans |
|
35 |
|
|
|
- |
|
|
|
71 |
|
|
|
- |
|
Gain on sales of PPP loans |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
86 |
|
Net unrealized gain (loss) on equity securities |
|
11 |
|
|
|
(53 |
) |
|
|
(207 |
) |
|
|
(74 |
) |
Gain (loss) on real estate owned, other repossessed
collateral and premises and equipment, net |
|
(29 |
) |
|
|
73 |
|
|
|
23 |
|
|
|
(1 |
) |
Correspondent fee income |
|
618 |
|
|
|
6,041 |
|
|
|
2,000 |
|
|
|
13,872 |
|
Gain on termination of interest rate swap |
|
- |
|
|
|
- |
|
|
|
96 |
|
|
|
- |
|
Bank-owned life insurance income |
|
110 |
|
|
|
106 |
|
|
|
219 |
|
|
|
212 |
|
Other noninterest income |
|
53 |
|
|
|
22 |
|
|
|
(12 |
) |
|
|
36 |
|
Total noninterest income |
|
1,301 |
|
|
|
6,493 |
|
|
|
2,960 |
|
|
|
14,892 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
8,452 |
|
|
|
7,406 |
|
|
|
16,717 |
|
|
|
14,968 |
|
Occupancy and equipment expense |
|
1,200 |
|
|
|
864 |
|
|
|
2,052 |
|
|
|
1,752 |
|
Professional fees |
|
464 |
|
|
|
394 |
|
|
|
979 |
|
|
|
915 |
|
Data processing fees |
|
1,216 |
|
|
|
1,099 |
|
|
|
2,320 |
|
|
|
2,174 |
|
Marketing expense |
|
219 |
|
|
|
158 |
|
|
|
395 |
|
|
|
350 |
|
Loan acquisition and collection expense |
|
749 |
|
|
|
211 |
|
|
|
1,390 |
|
|
|
2,459 |
|
FDIC insurance expense |
|
144 |
|
|
|
120 |
|
|
|
241 |
|
|
|
200 |
|
Other noninterest expense |
|
1,260 |
|
|
|
935 |
|
|
|
2,243 |
|
|
|
1,708 |
|
Total noninterest expense |
|
13,704 |
|
|
|
11,187 |
|
|
|
26,337 |
|
|
|
24,526 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax
expense |
|
16,024 |
|
|
|
16,430 |
|
|
|
27,849 |
|
|
|
30,515 |
|
Income tax expense |
|
4,726 |
|
|
|
5,027 |
|
|
|
8,264 |
|
|
|
9,236 |
|
Net income |
$ |
11,298 |
|
|
$ |
11,403 |
|
|
$ |
19,585 |
|
|
$ |
21,279 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
7,256,281 |
|
|
|
7,952,938 |
|
|
|
7,305,331 |
|
|
|
8,012,106 |
|
Diluted |
|
7,323,402 |
|
|
|
8,041,476 |
|
|
|
7,379,790 |
|
|
|
8,096,728 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
1.56 |
|
|
$ |
1.43 |
|
|
$ |
2.68 |
|
|
$ |
2.66 |
|
Diluted |
|
1.54 |
|
|
|
1.42 |
|
|
|
2.65 |
|
|
|
2.63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per
common share |
$ |
0.01 |
|
|
$ |
0.01 |
|
|
$ |
0.02 |
|
|
$ |
0.02 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NORTHEAST
BANK |
AVERAGE
BALANCE SHEETS AND ANNUALIZED YIELDS |
(Unaudited) |
(Dollars in
thousands) |
|
Three Months Ended December 31, |
|
2022 |
|
2021 |
|
|
|
Interest |
|
Average |
|
|
|
Interest |
|
Average |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities |
$ |
60,402 |
|
|
$ |
270 |
|
|
1.77 |
% |
|
$ |
65,444 |
|
|
$ |
76 |
|
|
0.46 |
% |
Loans (1) (2) (3) |
|
1,723,324 |
|
|
|
37,228 |
|
|
8.57 |
% |
|
|
1,133,421 |
|
|
|
21,195 |
|
|
7.42 |
% |
Federal Home Loan Bank stock |
|
4,549 |
|
|
|
47 |
|
|
4.10 |
% |
|
|
1,222 |
|
|
|
6 |
|
|
1.95 |
% |
Short-term investments (4) |
|
170,756 |
|
|
|
1,656 |
|
|
3.85 |
% |
|
|
319,639 |
|
|
|
112 |
|
|
0.14 |
% |
Total interest-earning
assets |
|
1,959,031 |
|
|
|
39,201 |
|
|
7.94 |
% |
|
|
1,519,726 |
|
|
|
21,389 |
|
|
5.58 |
% |
Cash and due from banks |
|
2,495 |
|
|
|
|
|
|
|
|
|
2,734 |
|
|
|
|
|
|
|
Other non-interest earning
assets |
|
143,481 |
|
|
|
|
|
|
|
|
|
61,013 |
|
|
|
|
|
|
|
Total assets |
$ |
2,105,007 |
|
|
|
|
|
|
|
|
$ |
1,583,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities &
Shareholders' Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW accounts |
$ |
551,998 |
|
|
$ |
3,575 |
|
|
2.57 |
% |
|
$ |
288,599 |
|
|
$ |
192 |
|
|
0.26 |
% |
Money market accounts |
|
243,953 |
|
|
|
805 |
|
|
1.31 |
% |
|
|
264,731 |
|
|
|
197 |
|
|
0.30 |
% |
Savings accounts |
|
124,990 |
|
|
|
356 |
|
|
1.13 |
% |
|
|
101,204 |
|
|
|
124 |
|
|
0.49 |
% |
Time deposits |
|
621,248 |
|
|
|
5,160 |
|
|
3.30 |
% |
|
|
225,801 |
|
|
|
671 |
|
|
1.18 |
% |
Total interest-bearing deposits |
|
1,542,189 |
|
|
|
9,896 |
|
|
2.55 |
% |
|
|
880,335 |
|
|
|
1,184 |
|
|
0.53 |
% |
Federal Home Loan Bank advances |
|
83,560 |
|
|
|
538 |
|
|
2.55 |
% |
|
|
15,000 |
|
|
|
127 |
|
|
3.36 |
% |
Lease liability |
|
16,679 |
|
|
|
15 |
|
|
0.36 |
% |
|
|
5,446 |
|
|
|
23 |
|
|
1.68 |
% |
Total interest-bearing
liabilities |
|
1,642,428 |
|
|
|
10,449 |
|
|
2.52 |
% |
|
|
900,781 |
|
|
|
1,334 |
|
|
0.59 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits and escrow
accounts |
|
195,907 |
|
|
|
|
|
|
|
|
|
427,550 |
|
|
|
|
|
|
|
Other liabilities |
|
10,226 |
|
|
|
|
|
|
|
|
|
14,072 |
|
|
|
|
|
|
|
Total liabilities |
|
1,848,561 |
|
|
|
|
|
|
|
|
|
1,342,403 |
|
|
|
|
|
|
|
Shareholders' equity |
|
256,446 |
|
|
|
|
|
|
|
|
|
241,070 |
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity |
$ |
2,105,007 |
|
|
|
|
|
|
|
|
$ |
1,583,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
|
|
$ |
28,752 |
|
|
|
|
|
|
|
|
$ |
20,055 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
|
|
|
|
|
|
5.42 |
% |
|
|
|
|
|
|
|
|
|
4.99 |
% |
Net interest margin (5) |
|
|
|
|
|
|
|
|
5.82 |
% |
|
|
|
|
|
|
|
|
|
5.24 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of funds (6) |
|
|
|
|
|
|
|
|
2.26 |
% |
|
|
|
|
|
|
|
|
|
0.40 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Interest income and yield are stated on a fully
tax-equivalent basis using the statutory tax rate.(2) Includes
loans held for sale. (3) Nonaccrual loans are included
in the computation of average, but unpaid interest has not been
included for purposes of determining interest income.(4) Short-term
investments include FHLB overnight deposits and other
interest-bearing deposits.(5) Net interest margin is calculated as
net interest income divided by total interest-earning assets.(6)
Cost of funds is calculated as total interest expense divided by
total interest-bearing liabilities plus demand deposits and escrow
accounts.
NORTHEAST
BANK |
AVERAGE
BALANCE SHEETS AND ANNUALIZED YIELDS |
(Unaudited) |
(Dollars
in thousands) |
|
Six Months Ended December 31, |
|
2022 |
|
2021 |
|
|
|
Interest |
|
Average |
|
|
|
Interest |
|
Average |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities |
$ |
61,064 |
|
|
$ |
419 |
|
|
1.36 |
% |
|
$ |
65,994 |
|
|
$ |
170 |
|
|
0.51 |
% |
Loans (1) (2) (3) |
|
1,545,498 |
|
|
|
63,307 |
|
|
8.13 |
% |
|
|
1,097,124 |
|
|
|
41,188 |
|
|
7.45 |
% |
Federal Home Loan Bank stock |
|
4,069 |
|
|
|
61 |
|
|
2.97 |
% |
|
|
1,216 |
|
|
|
13 |
|
|
2.12 |
% |
Short-term investments (4) |
|
156,123 |
|
|
|
2,278 |
|
|
2.89 |
% |
|
|
381,543 |
|
|
|
279 |
|
|
0.15 |
% |
Total interest-earning
assets |
|
1,766,754 |
|
|
|
66,065 |
|
|
7.42 |
% |
|
|
1,545,877 |
|
|
|
41,650 |
|
|
5.34 |
% |
Cash and due from banks |
|
2,514 |
|
|
|
|
|
|
|
|
|
2,774 |
|
|
|
|
|
|
|
Other non-interest earning
assets |
|
94,831 |
|
|
|
|
|
|
|
|
|
55,409 |
|
|
|
|
|
|
|
Total assets |
$ |
1,864,099 |
|
|
|
|
|
|
|
|
$ |
1,604,060 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities &
Shareholders' Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW accounts |
$ |
522,845 |
|
|
$ |
5,169 |
|
|
1.96 |
% |
|
$ |
279,316 |
|
|
$ |
367 |
|
|
0.26 |
% |
Money market accounts |
|
247,304 |
|
|
|
1,211 |
|
|
0.97 |
% |
|
|
270,318 |
|
|
|
399 |
|
|
0.29 |
% |
Savings accounts |
|
131,191 |
|
|
|
567 |
|
|
0.86 |
% |
|
|
86,432 |
|
|
|
193 |
|
|
0.44 |
% |
Time deposits |
|
387,480 |
|
|
|
5,751 |
|
|
2.94 |
% |
|
|
242,887 |
|
|
|
1,533 |
|
|
1.25 |
% |
Total interest-bearing deposits |
|
1,288,820 |
|
|
|
12,698 |
|
|
1.95 |
% |
|
|
878,953 |
|
|
|
2,492 |
|
|
0.56 |
% |
Federal Home Loan Bank advances |
|
72,949 |
|
|
|
933 |
|
|
2.54 |
% |
|
|
15,000 |
|
|
|
255 |
|
|
3.37 |
% |
Capital lease obligations |
|
10,429 |
|
|
|
33 |
|
|
0.63 |
% |
|
|
5,632 |
|
|
|
49 |
|
|
1.73 |
% |
Total interest-bearing
liabilities |
|
1,372,198 |
|
|
|
13,664 |
|
|
1.98 |
% |
|
|
899,585 |
|
|
|
2,796 |
|
|
0.62 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits and escrow
accounts |
|
228,800 |
|
|
|
|
|
|
|
|
|
449,500 |
|
|
|
|
|
|
|
Other liabilities |
|
9,118 |
|
|
|
|
|
|
|
|
|
17,119 |
|
|
|
|
|
|
|
Total liabilities |
|
1,610,116 |
|
|
|
|
|
|
|
|
|
1,366,204 |
|
|
|
|
|
|
|
Shareholders' equity |
|
253,983 |
|
|
|
|
|
|
|
|
|
237,856 |
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity |
$ |
1,864,099 |
|
|
|
|
|
|
|
|
$ |
1,604,060 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
|
|
$ |
52,401 |
|
|
|
|
|
|
|
|
$ |
38,854 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
|
|
|
|
|
|
5.44 |
% |
|
|
|
|
|
|
|
|
|
4.72 |
% |
Net interest margin (5) |
|
|
|
|
|
|
|
|
5.88 |
% |
|
|
|
|
|
|
|
|
|
4.99 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of funds (6) |
|
|
|
|
|
|
|
|
1.69 |
% |
|
|
|
|
|
|
|
|
|
0.41 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Interest income and yield are stated on a fully
tax-equivalent basis using the statutory tax rate.(2) Includes
loans held for sale.(3) Nonaccrual loans are included in the
computation of average, but unpaid interest has not been included
for purposes of determining interest income.(4) Short-term
investments include FHLB overnight deposits and other
interest-bearing deposits.(5) Net interest margin is calculated as
net interest income divided by total interest-earning assets.(6)
Cost of funds is calculated as total interest expense divided by
total interest-bearing liabilities plus demand deposits and escrow
accounts.
NORTHEAST
BANK |
SELECTED
FINANCIAL HIGHLIGHTS AND OTHER DATA |
(Unaudited) |
(Dollars in
thousands, except share and per share data) |
|
Three Months Ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
$ |
28,752 |
|
|
$ |
23,649 |
|
|
$ |
23,619 |
|
|
$ |
20,952 |
|
|
$ |
20,055 |
|
Provision (credit) for loan
losses |
|
325 |
|
|
|
850 |
|
|
|
(879 |
) |
|
|
(287 |
) |
|
|
(1,069 |
) |
Noninterest income |
|
1,301 |
|
|
|
1,659 |
|
|
|
4,144 |
|
|
|
5,408 |
|
|
|
6,493 |
|
Noninterest expense |
|
13,704 |
|
|
|
12,634 |
|
|
|
12,856 |
|
|
|
11,401 |
|
|
|
11,187 |
|
Net income |
|
11,298 |
|
|
|
8,287 |
|
|
|
10,296 |
|
|
|
10,587 |
|
|
|
11,403 |
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
|
7,256,281 |
|
|
|
7,312,291 |
|
|
|
7,506,465 |
|
|
|
7,687,737 |
|
|
|
7,952,938 |
|
Diluted |
|
7,323,402 |
|
|
|
7,394,089 |
|
|
|
7,617,933 |
|
|
|
7,790,963 |
|
|
|
8,041,476 |
|
Earnings per common
share: |
|
|
|
|
|
|
|
|
|
Basic |
$ |
1.56 |
|
|
$ |
1.13 |
|
|
$ |
1.37 |
|
|
$ |
1.38 |
|
|
$ |
1.43 |
|
Diluted |
|
1.54 |
|
|
|
1.12 |
|
|
|
1.35 |
|
|
|
1.36 |
|
|
|
1.42 |
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per common
share |
$ |
0.01 |
|
|
$ |
0.01 |
|
|
$ |
0.01 |
|
|
$ |
0.01 |
|
|
$ |
0.01 |
|
|
|
|
|
|
|
|
|
|
|
Return on average assets |
|
2.13 |
% |
|
|
2.03 |
% |
|
|
2.68 |
% |
|
|
2.79 |
% |
|
|
2.86 |
% |
Return on average equity |
|
17.48 |
% |
|
|
13.07 |
% |
|
|
16.55 |
% |
|
|
17.57 |
% |
|
|
18.77 |
% |
Net interest rate spread
(1) |
|
5.42 |
% |
|
|
5.61 |
% |
|
|
6.14 |
% |
|
|
5.52 |
% |
|
|
4.99 |
% |
Net interest margin (2) |
|
5.82 |
% |
|
|
5.96 |
% |
|
|
6.34 |
% |
|
|
5.71 |
% |
|
|
5.24 |
% |
Net interest margin, excluding
collection account (Non-GAAP) (3) |
|
5.85 |
% |
|
|
6.22 |
% |
|
|
7.07 |
% |
|
|
6.72 |
% |
|
|
6.44 |
% |
Efficiency ratio (non-GAAP)
(4) |
|
45.60 |
% |
|
|
49.92 |
% |
|
|
46.31 |
% |
|
|
43.25 |
% |
|
|
42.14 |
% |
Noninterest expense to average
total assets |
|
2.58 |
% |
|
|
3.09 |
% |
|
|
3.34 |
% |
|
|
3.01 |
% |
|
|
2.80 |
% |
Average interest-earning
assets to average interest-bearing liabilities |
|
119.28 |
% |
|
|
142.88 |
% |
|
|
156.64 |
% |
|
|
167.20 |
% |
|
|
168.71 |
% |
|
|
|
|
|
|
|
|
|
|
|
As of: |
|
December 31, 2022 |
|
September 30, 2022 |
|
June 30, 2022 |
|
March 31, 2022 |
|
December 31, 2021 |
Nonperforming loans: |
|
|
|
|
|
|
|
|
|
Originated portfolio: |
|
|
|
|
|
|
|
|
|
Residential real estate |
$ |
448 |
|
|
$ |
520 |
|
|
$ |
550 |
|
|
$ |
621 |
|
|
$ |
611 |
|
Commercial real estate |
|
3,297 |
|
|
|
3,528 |
|
|
|
5,031 |
|
|
|
6,608 |
|
|
|
7,963 |
|
Commercial and industrial |
|
631 |
|
|
|
452 |
|
|
|
202 |
|
|
|
230 |
|
|
|
311 |
|
Consumer |
|
8 |
|
|
|
8 |
|
|
|
11 |
|
|
|
12 |
|
|
|
20 |
|
Total originated
portfolio |
|
4,384 |
|
|
|
4,508 |
|
|
|
5,794 |
|
|
|
7,471 |
|
|
|
8,905 |
|
Total purchased portfolio |
|
8,515 |
|
|
|
9,089 |
|
|
|
7,152 |
|
|
|
10,441 |
|
|
|
12,294 |
|
Total nonperforming loans |
|
12,899 |
|
|
|
13,597 |
|
|
|
12,946 |
|
|
|
17,912 |
|
|
|
21,199 |
|
Real estate owned and other
repossessed collateral, net |
|
- |
|
|
|
90 |
|
|
|
- |
|
|
|
- |
|
|
|
53 |
|
Total nonperforming
assets |
$ |
12,899 |
|
|
$ |
13,687 |
|
|
$ |
12,946 |
|
|
$ |
17,912 |
|
|
$ |
21,252 |
|
|
|
|
|
|
|
|
|
|
|
Past due
loans to total loans |
|
0.74 |
% |
|
|
0.97 |
% |
|
|
0.53 |
% |
|
|
1.07 |
% |
|
|
1.23 |
% |
Nonperforming loans to total loans |
|
0.51 |
% |
|
|
0.93 |
% |
|
|
0.99 |
% |
|
|
1.45 |
% |
|
|
1.79 |
% |
Nonperforming assets to total assets |
|
0.46 |
% |
|
|
0.79 |
% |
|
|
0.82 |
% |
|
|
1.14 |
% |
|
|
1.46 |
% |
Allowance for loan losses to
total loans |
|
0.26 |
% |
|
|
0.40 |
% |
|
|
0.39 |
% |
|
|
0.47 |
% |
|
|
0.51 |
% |
Allowance for loan losses to
nonperforming loans |
|
49.70 |
% |
|
|
43.38 |
% |
|
|
38.34 |
% |
|
|
32.47 |
% |
|
|
28.49 |
% |
|
|
|
|
|
|
|
|
|
|
Commercial real estate loans
to total capital (5) |
|
661.48 |
% |
|
|
328.35 |
% |
|
|
294.20 |
% |
|
|
252.90 |
% |
|
|
260.40 |
% |
Net loans to deposits (6) |
|
113.74 |
% |
|
|
109.78 |
% |
|
|
100.94 |
% |
|
|
97.19 |
% |
|
|
102.53 |
% |
Purchased loans to total loans
(7) |
|
59.23 |
% |
|
|
32.62 |
% |
|
|
36.61 |
% |
|
|
38.94 |
% |
|
|
41.02 |
% |
Equity to total assets |
|
9.38 |
% |
|
|
14.47 |
% |
|
|
15.69 |
% |
|
|
15.80 |
% |
|
|
16.39 |
% |
Common equity tier 1 capital
ratio |
|
10.84 |
% |
|
|
17.36 |
% |
|
|
19.08 |
% |
|
|
20.13 |
% |
|
|
20.27 |
% |
Total capital ratio |
|
11.11 |
% |
|
|
17.77 |
% |
|
|
19.47 |
% |
|
|
20.60 |
% |
|
|
20.79 |
% |
Tier 1 leverage capital
ratio |
|
12.53 |
% |
|
|
15.59 |
% |
|
|
16.13 |
% |
|
|
16.17 |
% |
|
|
15.19 |
% |
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity |
$ |
263,427 |
|
|
$ |
252,163 |
|
|
$ |
248,321 |
|
|
$ |
247,469 |
|
|
$ |
239,237 |
|
Less: Preferred stock |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Common shareholders'
equity |
|
263,427 |
|
|
|
252,163 |
|
|
|
248,321 |
|
|
|
247,469 |
|
|
|
239,237 |
|
Less: Intangible assets
(8) |
|
- |
|
|
|
(1,141 |
) |
|
|
(1,285 |
) |
|
|
(1,696 |
) |
|
|
(1,645 |
) |
Tangible common shareholders'
equity (non-GAAP) |
$ |
263,427 |
|
|
$ |
251,022 |
|
|
$ |
247,036 |
|
|
$ |
245,773 |
|
|
$ |
237,592 |
|
|
|
|
|
|
|
|
|
|
|
Common shares outstanding |
|
7,511,044 |
|
|
|
7,477,158 |
|
|
|
7,442,103 |
|
|
|
7,727,312 |
|
|
|
7,815,566 |
|
Book value per common
share |
$ |
35.07 |
|
|
$ |
33.72 |
|
|
$ |
33.37 |
|
|
$ |
32.03 |
|
|
$ |
30.61 |
|
Tangible book value per share
(non-GAAP) (9) |
|
35.07 |
|
|
|
33.57 |
|
|
|
33.19 |
|
|
|
31.81 |
|
|
|
30.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The net interest rate spread represents the difference
between the weighted-average yield on interest-earning assets and
the weighted-average cost of interest-bearing liabilities for the
period.(2) The net interest margin represents net interest income
as a percent of average interest-earning assets for the
period (3) Net interest margin excluding collection
account removes the effects of the cash held by the Bank from the
correspondent’s collection account in short-term investments, which
had an average balance of $25.4 million, $99.2 million, $175.2
million, $244.0 million, and $287.7 million and earned $233
thousand, $514 thousand, $362 thousand, $60 thousand, and $73
thousand in interest income for the quarters ended December 31,
2022, September 30, 2022, June 30, 2022, March 31, 2022, and
December 31, 2021, respectively.(4) The efficiency ratio represents
noninterest expense divided by the sum of net interest income
(before provision for loan losses) plus noninterest income.(5) For
purposes of calculating this ratio, commercial real estate includes
all non-owner occupied commercial real estate loans defined as such
by regulatory guidance, including all land development and
construction loans. Beginning with the quarter ended December 31,
2022 and going forward, the Bank removed this internal policy
limit (previously 500%).(6) During the quarter ended June 30, 2022,
the Bank changed its internal policy limit to calculate based on
deposits, not core deposits (non-maturity deposits and maturity
deposits less than $250 thousand). Ratios as of March 31, 2022 and
December 31, 2021 reflect loans to core deposits. Beginning with
the quarter ended December 31, 2022 and going forward, the Bank
removed this internal policy limit (previously 125%).(7) Beginning
with the quarter ended December 31, 2022 and going forward, the
Bank removed this internal policy limit (previously 60%).(8)
Includes the loan servicing rights asset. Beginning with the
quarter ended December 31, 2022 and going forward, the Bank no
longer excludes the loan servicing rights asset from tangible
common shareholders’ equity.(9) Tangible book value per share
represents total shareholders' equity less the sum of preferred
stock and intangible assets divided by common shares
outstanding.
For More Information:Jean-Pierre Lapointe,
Chief Financial OfficerNortheast Bank, 27 Pearl Street, Portland,
ME 04101 207.786.3245 ext. 3220www.northeastbank.com
Northeast Bank (NASDAQ:NBN)
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