Union Bankshares, Inc. (NASDAQ - UNB) today announced results for
the three and nine months ended September 30, 2021 and declared a
regular quarterly cash dividend. Consolidated net income for the
three months ended September 30, 2021 was $3.9 million, or $0.87
per share, compared to $4.1 million, or $0.92 per share, for the
same period in 2020 and $9.8 million, or $2.18 per share, for the
nine months ended September 30, 2021, compared to $9.0 million, or
$2.01 per share, for the same period in 2020.
The Board of Directors declared a cash dividend
of $0.33 per share for the quarter payable November 4, 2021 to
shareholders of record as of October 30, 2021.
Third Quarter Financial
Highlights
Total assets increased to $1.16 billion as of
September 30, 2021 from $1.01 billion as of September 30,
2020 primarily due to increases of $96.4 million in investment
securities and $55.7 million in federal funds sold. Total loans
were $790.0 million as of September 30, 2021 compared to
$798.3 million as of September 30, 2020, a decrease of $8.3
million primarily due to sales of residential loans and PPP
forgiveness. Total deposits increased $130.6 million, or 14.3%, to
$1.04 billion, since September 30, 2020 due to the general
increase of money supply provided to our customers through various
stimulus packages. The high level of customer deposit balances has
allowed for less reliance on wholesale funding which was $7.0
million as of September 30, 2021 compared to $9.5 million as
of September 30, 2020.
Union Bankshares, Inc. announced on August 26,
2021 that it completed a private placement of $16.5 million in
aggregate principal amount of fixed-to-floating rate subordinated
notes due 2031 to certain qualified institutional buyers and
accredited investors. Proceeds from the sale of the notes were used
to provide additional capital support to the Company's wholly-owned
subsidiary, Union Bank, to support growth and for other general
corporate purposes.
The Company had total equity capital of $83.7
million with a book value per share of $18.67 as of
September 30, 2021 compared to $78.4 million with a book value
of $17.52 per share as of September 30, 2020.
Consolidated net income decreased $222 thousand,
or 5.4%, to $3.9 million for the third quarter of 2021 compared to
the third quarter of 2020. Net interest income improved to $9.1
million for the three months ended September 30, 2021 compared to
$8.2 million for the three months ended September 30, 2020, an
increase of $961 thousand, or 11.7%. The low interest rate
environment and competition for good loans continues to put
downward pressure on earning asset yields, however, this is
currently offset by the larger earning asset base and recognition
of fee income on PPP loans. The low interest rate environment has
also resulted in a decrease in interest expense despite the high
levels of customer deposit balances.
No provision for loan losses was recorded for
the three months ended September 30, 2021 compared to $800 thousand
for the same period in 2020. The allowance for loan losses as of
September 30, 2021 is determined to be sufficient based on the
current size and mix of the loan portfolio and the assessment of
qualitative factors.
Noninterest income amounted to $4.2 million for
the three months ended September 30, 2021 compared to $5.5 million
for the same period in 2020, a decrease of $1.3 million, or 23.6%.
The decrease is primarily attributable to lower sales volume of
residential loans. Gain on sales of qualifying residential loans
amounted to $1.9 million on volume of $79.1 million for the three
months ended September 30, 2021 compared to gains of $3.3 million
on volume of $89.8 million for the same period in 2020.
Noninterest expenses increased $553 thousand, or
6.9%, to $8.5 million for the three months ended September 30, 2021
compared to $8.0 million for the same period in 2020 due to
increases in salaries and wages, occupancy, equipment, and other
expenses.
Year-to-Date Highlights
Consolidated net income was $9.8 million, or
$2.18 per share, compared to $9.0 million, or $2.01 per share, for
the nine months ended September 30, 2021 and 2020, respectively.
The increase in earnings was due to an increase of $3.0 million in
net interest income and a decrease of $1.4 million in the provision
for loan losses, partially offset by a decrease in noninterest
income of $1.1 million and increases in noninterest expenses of
$2.1 million and income tax expense of $424 thousand.
Interest income increased $1.8 million, or 6.6%,
to $29.3 million for the nine months ended September 30, 2021
compared to $27.4 million for the nine months ended September 30,
2020. Interest expense was $2.8 million for the nine months ended
September 30, 2021 compared to $4.0 million for the nine months
ended September 30, 2020.
Total noninterest income amounted to $10.0
million for the nine months ended September 30, 2021 compared to
$11.0 million for the nine months ended September 30, 2020, a
decrease of $1.1 million, or 9.6%. The decrease is primarily due to
a decrease in gains on sales of residential loans partially offset
by an increase in ATM network income as a result of increased debit
card usage. Gain on sales of qualifying residential loans amounted
to $4.0 million for the nine months ended September 30, 2021 and
$5.4 million for the nine months ended September 30, 2020 resulting
from sales of $164.2 million for the nine months ended September
30, 2021 compared to $187.5 million for the same period in
2020.
Total noninterest expenses were $24.4 million
for the nine months ended September 30, 2021 compared to $22.3
million for the same period in 2020, an increase of $2.1 million,
or 9.5%. Salaries and wages increased $886 thousand during the
comparison period due to annual salary increases, hiring of
personnel in preparation for upcoming retirements, and timing of
the recognition of deferred loan origination costs. Other expenses
increased $789 thousand during the comparison period primarily due
to increases in the FDIC insurance assessment and Vermont Franchise
taxes due to the increases in total assets and the customer deposit
base.
About Union Bankshares,
Inc.
Union Bankshares, Inc., headquartered in
Morrisville, Vermont, is the bank holding company parent of Union
Bank, which provides commercial, retail, and municipal banking
services, as well as, asset management services throughout northern
Vermont and New Hampshire. Union Bank operates 18 banking offices,
three loan centers, and multiple ATMs throughout its geographical
footprint.
Since 1891, Union Bank has helped people achieve
their dreams of owning a home, saving for retirement, starting or
expanding a business and assisting municipalities to improve their
communities. Union Bank has earned an exceptional reputation for
residential lending programs and has been recognized by the US
Department of Agriculture, Rural Development for the positive
impact made in lives of low to moderate home buyers. Union Bank is
consistently one of the top Vermont Housing Finance Agency mortgage
originators and has also been designated as an SBA Preferred lender
for its participation in small business lending. Union Bank's
employees contribute to the communities where they work and reside,
serving on non-profit boards, raising funds for worthwhile causes,
and giving countless hours in serving our fellow residents. All of
these efforts have resulted in Union receiving and "Outstanding"
rating for its compliance with the Community Reinvestment Act
("CRA") in its most recent examination. Union Bank is proud to be
one of the few independent community banks serving Vermont and New
Hampshire and we maintain a strong commitment to our core
traditional values of keeping deposits safe, giving customers
convenient financial choices and making loans to help people in our
local communities buy homes, grow businesses, and create jobs.
These values--combined with financial expertise, quality products
and the latest technology--make Union Bank the premier choice for
your banking services, both personal and business. Member FDIC.
Equal Housing Lender.
Forward-Looking Statements
Statements made in this press release that are
not historical facts are forward-looking statements. Investors are
cautioned that all forward-looking statements necessarily involve
risks and uncertainties, and many factors could cause actual
results and events to differ materially from those contemplated in
the forward-looking statements. When we use any of the words
“believes,” “expects,” “anticipates” or similar expressions, we are
making forward-looking statements. The following factors, among
others, could cause actual results and events to differ from those
contemplated in the forward-looking statements: uncertainties
associated with general economic conditions; changes in the
interest rate environment; inflation; political, legislative or
regulatory developments; acts of war or terrorism; the markets'
acceptance of and demand for the Company's products and services;
technological changes, including the impact of the internet on the
Company's business and on the financial services market place
generally; the impact of competitive products and pricing; and
dependence on third party suppliers. For further information,
please refer to the Company's reports filed with the Securities and
Exchange Commission at www.sec.gov or on our investor page at
www.ublocal.com.
Contact: David S.
Silverman(802) 888-6600
Union Bankshares (NASDAQ:UNB)
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