POUGHKEEPSIE, N.Y.,
April 29, 2021 /PRNewswire/
-- Rhinebeck Bancorp, Inc. (the "Company") (NASDAQ:
RBKB), the holding company of Rhinebeck
Bank (the "Bank"), reported net income for the three months
ended March 31, 2021 of $3.3 million ($0.31
per basic and diluted share), compared with $1.1 million ($0.10
per basic and diluted share) for the comparable prior year period,
which was an increase of $2.2
million, or 208.9%. The favorable variance in net income
came largely from a $1.5 million
increase in net interest income and a credit to the provision for
loan losses of $69,000 in the first
quarter of 2021 as compared to a provision for loan losses of
$1.2 million for the first quarter of
2020. The Company's return on average assets and return on average
equity were 1.18% and 11.40%, respectively, in the first quarter of
2021 as compared to 0.44% and 3.85%, respectively, in the first
quarter of 2020.
On October 26, 2020, the Bank
entered into a branch purchase and assumption agreement with
ConnectOne Bank, to acquire two branches located in
Warwick and Monroe, New York, as well as certain deposits
and other assets and liabilities. The transaction closed on
March 12, 2021 with the transfer of
$33.9 million of deposits.
COVID-19 Impact
Loan Deferrals. The Bank's initiative to
work with borrowers that were unable to meet their contractual
obligations because of the effects of COVID-19 has been a
successful effort overall. For the three months ended March 31, 2021, the Bank granted 111 new loan
deferrals totaling $1.7 million. As
of March 31, 2021, we had 73 loans totaling $34.8 million of remaining deferrals outstanding
and all were performing in accordance with their contractual terms.
Pursuant to the CARES Act, these loan deferrals are not included in
our non-performing loans.
Paycheck Protection Program. The second round PPP
program began accepting new loan applications on January 11, 2021. We received SBA approval for
338 applications totaling $46.6
million and by quarter end 318 of these accounts totaling
$45.2 million had been funded. At
March 31, 2021, we had $92.1 million of PPP loans outstanding.
Other financial highlights:
- Record net income of $3.3 million
in the first quarter of 2021, a 208.9% increase over the same
quarter in 2020.
- Completed the acquisition of two branch locations from
ConnectOne Bank, adding $33.9 million
in deposits, and received regulatory approval to open two
additional branches, expanding our footprint in Orange County, New York.
- Our return on average equity increased to 11.40% for the first
quarter of 2021 from 3.85% for the same quarter of 2020.
- Total assets grew $68.2 million,
or 6.0%, to $1.20 billion at
March 31, 2021 from $1.13 billion at December
31, 2020.
- Total deposit balances were $1.01
billion at March 31, 2021,
increasing $78.6 million, or 8.5%,
from $929.4 million at December 31, 2020.
- Our efficiency ratio improved, falling to 66.15% for the first
quarter of 2021 from 73.87% for the same quarter of 2020.
President and Chief Executive Officer Michael J. Quinn said, "We are pleased with our
first quarter results for 2021. Results were positively
affected by lower loan loss provisions and increased net interest
income for the quarter. The lower provisions were due to both
improved loan performance as we get past the pandemic and lower
loan balances. We look forward to rebuilding our loan
pipelines to get back to loan growth in the second half of the
year. We continue to focus on the Bank's growth and
supporting our communities as both pandemic conditions and the
economy improve over the course of the coming year.
Income Statement Analysis
Net income for the three months ended March 31, 2021 increased $2.2 million, or 208.9%, to $3.3 million, or $0.31 per basic and diluted share, compared to
net income of $1.1 million, or
$0.10 per basic and diluted share,
for the three months ended March 31,
2020.
Net interest income increased $1.5
million, or 17.6%, to $9.8
million for the three months ended March 31, 2021, from $8.3
million for the three months ended March 31, 2020. The increase was primarily
driven by higher interest-earning asset balances and the favorable
impact of lower costs for deposits and borrowings, which were
partially offset by lower yields on interest-earning assets
primarily as a result of the addition of the lower-yielding PPP
loan balances. Our net interest margin increased 3 basis points to
3.65% for the three months ended March 31,
2021 from 3.62% for the same period in 2020 as efforts to
reduce interest expense were realized.
The provision for loan losses decreased by $1.3 million from $1.2
million for the quarter ended March
31, 2020 resulting in a credit of $69,000 for the current quarter. The provision
for the first quarter of 2020 increased as a result of the onset of
the COVID-19 pandemic and related economic conditions. The
credit for the first quarter of 2021 was primarily attributable to
a decline in loan balances, exclusive of PPP loans, a reduction in
specific allocations to the allowance for loan losses and a general
improvement in the economic conditions.
Net charge-offs for the quarter ended March 31,
2021 totaled $303,000 compared
to $535,000 for the respective period
in 2020, as charge-offs fell and recoveries improved period over
period.
Non-interest income totaled $2.2
million for the three months ended March 31, 2021, an increase of $681,000, or 43.7%, from the comparable period in
the prior year. The increase was primarily due to an increase in
the net gain on the sale of loans, which increased $594,000, or 127.7%, and proceeds from life
insurance of $195,000. These gains
were partially offset by a $95,000
decrease in investment advisory income and a $43,000 decrease in service charges on deposit
accounts. The Bank sold $24.7 million
of loans in the first quarter of 2021 compared to $16.1 million of loans in the first quarter of
2020.
For the first quarter of 2021, non-interest expense totaled
$8.0 million, an increase of
$654,000, or 9.0%, over the
comparable 2020 period. The increase was primarily due to an
increase in salaries and benefits of $440,000, or 10.6%, as the Company hired new
employees for its new branches. Occupancy expenses also increased
$104,000, or 12.2%, as a result of
the additional rent, depreciation, and other expenses related to
the branch expansion. The addition of branches was also
primarily responsible for increased professional fees of
$86,000, increased data processing
costs of $41,000 and increased other
expenses of $49,000.
Balance Sheet Analysis
Total assets were $1.20 billion at
March 31, 2021, representing an
increase of $68.2 million, or 6.0%,
from $1.13 billion at December 31, 2020. Available for sale securities
increased $72.5 million, or 70.5%,
primarily due to $88.4 million of new
purchases as we deployed excess cash received from PPP
borrower-related accounts and the additional deposits acquired in
the branch acquisitions. The increase in available for sale
securities was partially offset by paydowns, calls and maturities
of $14.5 million. Net loans decreased
$5.1 million, or 0.6%, primarily due
to production shortfalls of new indirect automobile and
non-residential real estate loans which were partially offset by
production increases in new multi-family real estate and PPP loans.
Past due loans decreased $6.1
million, or 34.0%, between December
31, 2020 and March 31, 2021
finishing at $11.9 million, or 1.4%
of total loans, down from $18.0
million, or 2.1% of total loans, at year-end 2020. Past due
loan balances have been positively impacted by the new round of PPP
loans and the economic stimulus received by customers in the
current quarter. Our allowance for loan losses as a percentage of
total gross loans was 1.29% at March 31,
2021 as compared to 1.33% at December
31, 2020.
As of March 31, 2021, total
liabilities increased $65.9 million,
or 6.5%, to $1.08 billion, mainly due
to a $78.7 million increase in
deposits due to the acquisition of $33.9
million in deposits from ConnectOne Bank, an accumulation of
liquidity by customers in response to government stimulus actions,
increases in PPP borrower-related accounts and normal fluctuations
in some of our large business accounts. A decrease of $14.2 million in Federal Home Loan Bank advances
partially offset the increase in the other liabilities.
Stockholders' equity increased $2.4
million to $118.9 million at
March 31, 2021, primarily due to net
income of $3.3 million partially
offset by a $1.2 million increase in
accumulated other comprehensive loss due to a reversal from a net
unrealized gain to a net unrealized loss on available for sale
securities. The Company's ratio of average equity to average assets
was 10.31% for the period ended March 31,
2021 and 10.65% for the year ended December 31, 2020.
About Rhinebeck Bancorp
Rhinebeck Bancorp, Inc. is a Maryland corporation organized as the mid-tier
holding company of Rhinebeck Bank
and is itself the majority-owned subsidiary of Rhinebeck Bancorp,
MHC. The Bank is a New York
chartered stock savings bank which provides a full range of banking
and financial services to consumer and commercial customers through
its thirteen active branches and two representative offices located
in Dutchess, Ulster, Orange, and Albany counties in New York State.
Financial services including comprehensive brokerage, investment
advisory services, financial product sales and employee benefits
are offered through Rhinebeck Asset Management, a division of the
Bank.
Forward Looking Statements
This press release contains certain forward-looking statements
about the Company and the Bank. Forward-looking statements
include statements regarding anticipated future events or results
and can be identified by the fact that they do not relate strictly
to historical or current facts. They often include words such
as "believe", "expect", "anticipate", "estimate", "intend",
"predict", "forecast", "improve", "continue", "will", "would",
"should", "could", or "may". Forward-looking statements, by
their nature, are subject to risks and uncertainties. Certain
factors that could cause actual results to differ materially from
expected results include increased competitive pressures, changes
in the interest rate environment, general economic conditions or
conditions within the securities markets, changes in demand for our
products and services and legislative, accounting and regulatory
changes that could adversely affect the Company's financial
condition and results of operations and the business in which the
Company and the Bank are engaged.
Further, given its ongoing and dynamic nature, it is difficult
to predict the full impact of the COVID-19 outbreak on our
business. The extent of such impact will depend on future
developments, which are highly uncertain, including when the
coronavirus can be controlled and abated and whether the gradual
reopening of businesses will result in a meaningful increase in
economic activity. As the result of the COVID-19 pandemic and the
related adverse local and national economic consequences, we could
be subject to any of the following risks, any of which could have a
material, adverse effect on our business, financial condition,
liquidity, and results of operations: the demand for our products
and services may decline, making it difficult to grow assets and
income; if the economy is unable to substantially reopen, and
higher levels of unemployment continue for an extended period of
time, loan delinquencies, problem assets, and foreclosures may
increase, resulting in increased charges and reduced income;
collateral for loans, especially real estate, may decline in value,
which could cause loan losses to increase; our allowance for loan
losses may increase if borrowers experience financial difficulties,
which will adversely affect our net income; the net worth and
liquidity of loan guarantors may decline, impairing their ability
to honor commitments to us; as the result of the decline in the
Federal Reserve Board's target federal funds rate to near 0%, the
yield on our assets may decline to a greater extent than the
decline in our cost of interest-bearing liabilities, reducing our
net interest margin and spread and reducing net income; our wealth
management revenues may decline with continuing market turmoil; our
cyber security risks are increased as the result of an increase in
the number of employees working remotely; and FDIC premiums may
increase if the agency experiences additional resolution costs.
Accordingly, you should not place undue reliance on
forward-looking statements. Rhinebeck Bancorp, Inc. undertakes no
obligation to revise these forward-looking statements or to reflect
events or circumstances after the date of this press release.
The Company's summary consolidated statements of income and
financial condition and other selected financial data follow:
Rhinebeck
Bancorp, Inc. and Subsidiary
|
Consolidated
Statements of Income (Unaudited)
(Dollars in
thousands, except share and per share data)
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2021
|
|
2020
|
|
Interest and
Dividend Income
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
10,670
|
|
$
|
10,046
|
|
Interest and dividends
on securities
|
|
|
363
|
|
|
683
|
|
Other income
|
|
|
19
|
|
|
11
|
|
Total interest and
dividend income
|
|
|
11,052
|
|
|
10,740
|
|
Interest
Expense
|
|
|
|
|
|
|
|
Interest expense on
deposits
|
|
|
1,020
|
|
|
2,017
|
|
Interest expense on
borrowings
|
|
|
250
|
|
|
402
|
|
Total interest
expense
|
|
|
1,270
|
|
|
2,419
|
|
Net interest
income
|
|
|
9,782
|
|
|
8,321
|
|
(Credit to)
provision for loan losses
|
|
|
(69)
|
|
|
1,200
|
|
Net interest income
after (credit to) provision for loan losses
|
|
|
9,851
|
|
|
7,121
|
|
Noninterest
Income
|
|
|
|
|
|
|
|
Service charges on
deposit accounts
|
|
|
609
|
|
|
652
|
|
Net realized loss on
sales and calls of securities
|
|
|
—
|
|
|
(29)
|
|
Net gain on sales of
loans
|
|
|
1,059
|
|
|
465
|
|
Increase in cash
surrender value of life insurance
|
|
|
94
|
|
|
97
|
|
Gain on disposal of
premises and equipment
|
|
|
17
|
|
|
—
|
|
Proceeds from
insurance
|
|
|
195
|
|
|
—
|
|
Investment advisory
income
|
|
|
217
|
|
|
312
|
|
Other
|
|
|
50
|
|
|
63
|
|
Total noninterest
income
|
|
|
2,241
|
|
|
1,560
|
|
Noninterest
Expense
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
|
4,592
|
|
|
4,152
|
|
Occupancy
|
|
|
954
|
|
|
850
|
|
Data
processing
|
|
|
395
|
|
|
354
|
|
Professional
fees
|
|
|
408
|
|
|
322
|
|
Marketing
|
|
|
88
|
|
|
143
|
|
FDIC deposit insurance
and other insurance
|
|
|
171
|
|
|
168
|
|
Other real estate owned
expense
|
|
|
1
|
|
|
17
|
|
Amortization of
intangible assets
|
|
|
13
|
|
|
11
|
|
Other
|
|
|
1,331
|
|
|
1,282
|
|
Total noninterest
expense
|
|
|
7,953
|
|
|
7,299
|
|
Income before income
taxes
|
|
|
4,139
|
|
|
1,382
|
|
Provision for
income taxes
|
|
|
818
|
|
|
307
|
|
Net income
|
|
$
|
3,321
|
|
$
|
1,075
|
|
|
|
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.31
|
|
$
|
0.10
|
|
Diluted
|
|
$
|
0.31
|
|
$
|
0.10
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding, basic
|
|
|
10,743,234
|
|
|
10,721,413
|
|
Weighted average
shares outstanding, diluted
|
|
|
10,875,116
|
|
|
10,721,413
|
|
Rhinebeck
Bancorp, Inc. and Subsidiary
|
Consolidated
Statements of Financial Condition (Unaudited)
(Dollars in
thousands, except share and per share data)
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|
|
2021
|
|
2020
|
|
Assets
|
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
|
89,833
|
|
$
|
93,485
|
|
Available for sale
securities (at fair value)
|
|
|
175,460
|
|
|
102,933
|
|
Loans receivable (net
of allowance for loan losses of $11,261 and $11,633,
respectively)
|
|
|
868,737
|
|
|
873,813
|
|
Federal Home Loan
Bank stock
|
|
|
2,143
|
|
|
2,787
|
|
Accrued interest
receivable
|
|
|
3,840
|
|
|
3,819
|
|
Cash surrender value
of life insurance
|
|
|
18,631
|
|
|
18,877
|
|
Deferred tax assets
(net of valuation allowance of $1,821 and $1,760,
respectively)
|
|
|
4,122
|
|
|
3,703
|
|
Premises and
equipment, net
|
|
|
18,933
|
|
|
18,839
|
|
Other real estate
owned
|
|
|
89
|
|
|
139
|
|
Goodwill
|
|
|
2,235
|
|
|
1,410
|
|
Intangible assets,
net
|
|
|
515
|
|
|
199
|
|
Other
assets
|
|
|
12,500
|
|
|
8,825
|
|
Total
assets
|
|
$
|
1,197,038
|
|
$
|
1,128,829
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
|
Noninterest
bearing
|
|
$
|
272,617
|
|
$
|
244,344
|
|
Interest
bearing
|
|
|
735,419
|
|
|
685,020
|
|
Total
deposits
|
|
|
1,008,036
|
|
|
929,364
|
|
|
|
|
|
|
|
|
|
Mortgagors' escrow
accounts
|
|
|
7,280
|
|
|
8,494
|
|
Advances from the
Federal Home Loan Bank
|
|
|
36,468
|
|
|
50,674
|
|
Subordinated
debt
|
|
|
5,155
|
|
|
5,155
|
|
Accrued expenses and
other liabilities
|
|
|
21,243
|
|
|
18,643
|
|
Total
liabilities
|
|
|
1,078,182
|
|
|
1,012,330
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
Preferred stock (par
value $0.01 per share; 5,000,000 authorized, no shares
issued)
|
|
|
—
|
|
|
—
|
|
Common stock (par
value $0.01 per share; 25,000,000 authorized, 11,133,290 issued and
outstanding)
|
|
|
111
|
|
|
111
|
|
Additional paid-in
capital
|
|
|
46,188
|
|
|
46,038
|
|
Unearned common stock
held by the employee stock ownership plan ("ESOP")
|
|
|
(3,873)
|
|
|
(3,928)
|
|
Retained
earnings
|
|
|
81,390
|
|
|
78,069
|
|
Accumulated other
comprehensive loss:
|
|
|
|
|
|
|
|
Net unrealized (loss)
gain on available for sale securities, net of taxes
|
|
|
(177)
|
|
|
993
|
|
Defined benefit pension
plan, net of taxes
|
|
|
(4,783)
|
|
|
(4,784)
|
|
Total accumulated
other comprehensive loss
|
|
|
(4,960)
|
|
|
(3,791)
|
|
Total stockholders'
equity
|
|
|
118,856
|
|
|
116,499
|
|
Total liabilities and
stockholders' equity
|
|
$
|
1,197,038
|
|
$
|
1,128,829
|
|
Rhinebeck
Bancorp, Inc. and Subsidiary
|
Selected Ratios
(Unaudited)
|
|
|
|
|
Three Months Ended
|
|
|
Year
Ended
|
|
|
March
31,
|
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
|
2020
|
Performance
Ratios (1):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets (2)
|
|
1.18
|
%
|
0.44
|
%
|
|
0.55
|
%
|
Return on average
equity (3)
|
|
11.40
|
%
|
3.85
|
%
|
|
5.17
|
%
|
Net interest margin
(4)
|
|
3.65
|
%
|
3.62
|
%
|
|
3.56
|
%
|
Efficiency ratio
(5)
|
|
66.15
|
%
|
73.87
|
%
|
|
67.29
|
%
|
Average
interest-earning assets to average interest-bearing
liabilities
|
|
143.91
|
%
|
135.85
|
%
|
|
140.37
|
%
|
Total gross loans to
total deposits
|
|
86.58
|
%
|
102.84
|
%
|
|
94.32
|
%
|
Average equity to
average assets (6)
|
|
10.31
|
%
|
11.41
|
%
|
|
10.65
|
%
|
|
|
|
|
|
|
|
|
|
Asset Quality
Ratios:
|
|
|
|
|
|
|
|
|
Allowance for loan
losses as a percent of total gross loans
|
|
1.29
|
%
|
0.82
|
%
|
|
1.33
|
%
|
Allowance for loan
losses as a percent of non-performing loans
|
|
179.12
|
%
|
80.38
|
%
|
|
183.63
|
%
|
Net charge-offs to
average outstanding loans during the period
|
|
(0.03)
|
%
|
(0.07)
|
%
|
|
(0.17)
|
%
|
Non-performing loans
as a percent of total gross loans
|
|
0.72
|
%
|
1.02
|
%
|
|
0.72
|
%
|
Non-performing assets
as a percent of total assets
|
|
0.53
|
%
|
0.95
|
%
|
|
0.57
|
%
|
|
|
|
|
|
|
|
|
|
Capital
Ratios (7):
|
|
|
|
|
|
|
|
|
Tier 1 capital (to
risk-weighted assets)
|
|
13.13
|
%
|
12.04
|
%
|
|
12.72
|
%
|
Total capital (to
risk-weighted assets)
|
|
14.38
|
%
|
12.80
|
%
|
|
13.97
|
%
|
Common equity Tier 1
capital (to risk-weighted assets)
|
|
13.13
|
%
|
12.04
|
%
|
|
12.72
|
%
|
Tier 1 leverage ratio
(to average total assets)
|
|
9.88
|
%
|
10.68
|
%
|
|
9.95
|
%
|
|
|
|
|
|
|
|
|
|
Other
Data:
|
|
|
|
|
|
|
|
|
Book value per common
share
|
|
$ 10.68
|
|
$ 10.23
|
|
|
$ 10.46
|
|
Tangible book value
per common share(8)
|
|
$ 10.43
|
|
$ 10.08
|
|
|
$ 10.32
|
|
|
|
(1)
|
Performance ratios
for the three months ended March 31, 2021 and 2020 are
annualized.
|
(2)
|
Represents net income
divided by average total assets.
|
(3)
|
Represents net income
divided by average equity.
|
(4)
|
Represents net
interest income as a percent of average interest-earning
assets.
|
(5)
|
Represents
non-interest expense divided by the sum of net interest income and
non-interest income.
|
(6)
|
Represents average
equity divided by average total assets.
|
(7)
|
Capital ratios are
for Rhinebeck Bank only. Rhinebeck Bancorp, Inc. is not subject to
the minimum consolidated capital requirements as a small bank
holding company with assets less than $3.0 billion.
|
(8)
|
Represents a non-GAAP
financial measure, see table below for a reconciliation of the
non-GAAP financial measures.
|
NON-GAAP FINANCIAL INFORMATION
This Report contains financial information determined by methods
other than in accordance with generally accepted accounting
principles ("GAAP"). Such non-GAAP financial information includes
the following measure: "tangible book value per common share."
Management uses this non-GAAP measure because they believe that it
may provide useful supplemental information for evaluating our
operations and performance, as well as in managing and evaluating
our business and in discussions about our operations and
performance. Management believes this non-GAAP measure may also
provide users of our financial information with a meaningful
measure for assessing our financial results, as well as a
comparison to financial results for prior periods. This non-GAAP
measure should be viewed in addition to, and not as an alternative
to or substitute for, measures determined in accordance with GAAP
and are not necessarily comparable to other similarly titled
measures used by other companies. To the extent applicable,
reconciliations of these non-GAAP measures to the most directly
comparable measures as reported in accordance with GAAP are
included below.
|
|
|
|
|
|
|
|
|
|
(Dollars in
thousands, except per share data)
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
March
31,
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
2020
|
Book value per
common share reconciliation
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity (book value) (GAAP)
|
|
$
|
118,856
|
|
$
|
113,897
|
|
$
|
116,499
|
Total shares
outstanding
|
|
|
11,133.29
|
|
|
11,133.29
|
|
|
11,133.29
|
Book value per common
share
|
|
$
|
10.68
|
|
$
|
10.23
|
|
$
|
10.46
|
Total common
equity
|
|
|
|
|
|
|
|
|
|
Total equity
(GAAP)
|
|
$
|
118,856
|
|
$
|
113,897
|
|
$
|
116,499
|
Goodwill
|
|
|
(2,235)
|
|
|
(1,410)
|
|
|
(1,410)
|
Intangible
assets
|
|
|
(515)
|
|
|
(230)
|
|
|
(199)
|
Tangible common equity
(non-GAAP)
|
|
$
|
116,106
|
|
$
|
112,257
|
|
$
|
114,890
|
Tangible book
value per common share
|
|
|
|
|
|
|
|
|
|
Tangible common
equity (non-GAAP)
|
|
$
|
116,106
|
|
$
|
112,257
|
|
$
|
114,890
|
Total shares
outstanding
|
|
|
11,133.29
|
|
|
11,133.29
|
|
|
11,133.29
|
Tangible book value per
common share
|
|
$
|
10.43
|
|
$
|
10.08
|
|
$
|
10.32
|
Contact: Michael J. Quinn,
President and Chief Executive Officer, Telephone: (845)
790-1501
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SOURCE Rhinebeck Bancorp, Inc.