Elmira Savings Bank Reports First Quarter Earnings

ELMIRA, N.Y., April 24, 2018 (GLOBE NEWSWIRE) -- Elmira Savings Bank (NASDAQ:ESBK)

Highlights

Net income was $1,131,000 for the three months ended March 31, 2018 compared to $1,079,000 for the same period in 2017.

Diluted earnings per share were $.34 per share for the three months ended March 31, 2018 compared to $.31 per share for the same period in 2017.

Return on average assets was .83% for the three months ended March 31, 2018 and .78% for the same period in 2017.

Return on average equity was 8.03% for the three months ended March 31, 2018 compared to 7.74% for the same period in 2017.

“The increase in net income combined with the effect of our capital restructuring last year has improved diluted earnings per share by 10% from the first quarter of 2018 to the same period one year ago” said Thomas M. Carr, President and CEO. Carr continued, “We are pleased the Bank’s net interest margin continues to improve and that recent asset quality improvements have been sustained.”

Net Income

Net income totaled $1,131,000 for the three months ended March 31, 2018, an increase of $52,000 or 4.8% from the $1,079,000 recorded for the same period in 2017. This increase was the net result of an increase in net interest income of $2,000, a decrease in tax expense of $203,000, and consistent levels in noninterest expense, offset by an increase in the provision for loan losses of $2,000 and a decrease in noninterest income of $151,000.

Basic and diluted earnings per share for the three months ended March 31, 2018 were both $.34 per share compared to $.31 per share for both for the same period in 2017.

Net Interest Margin

The net interest margin for the three months ended March 31, 2018 was 3.38% compared to 3.32% for the first quarter of 2017. The yield on average earning assets was 4.19% for the three months ended March 31, 2018 compared to 4.11% for the same period in 2017. The average cost of interest-bearing liabilities was .96% for the three months ended March 31, 2018 compared to .93% for the three months ended March 31, 2017.

Assets

Total assets decreased $1.3 million or 0.2% to $553.3 million at March 31, 2018 compared to $554.6 million at December 31, 2017. Loans receivable decreased 1.5% to $451.6 million at March 31, 2018 compared to December 31, 2017. The available-for-sale investment portfolio decreased $1.0 million from December 31, 2017 to March 31, 2018, and cash and cash equivalents increased by $8.7 million from December 31, 2017 to March 31, 2018.

Nonperforming Loans

Our nonperforming loans to total loans ratio was .70% at March 31, 2018 and .64% at December 31, 2017. Net loan charge-offs to average loans for the three months ended March 31, 2018 was .05% and .01% for the three months ended March 31, 2017. The allowance for loan losses was .98% of total loans at March 31, 2018 and .97% at December 31, 2017.

Liabilities

Deposits totaled $456.3 million at March 31, 2018, a decrease of $440,000 or 0.1% from the December 31, 2017 total of $456.8 million. Borrowed funds remained unchanged from December 31, 2017 at $35.0 million.

Shareholders’ Equity

Shareholders’ equity increased $206,000 to $56.9 million at March 31, 2018 compared to December 31, 2017. The current level of shareholders’ equity equates to a book value per share of $17.09 at March 31, 2018, compared to $17.07 at December 31, 2017. Dividends paid to common shareholders were $0.23 for the three months ended both March 31, 2018 and 2017. As a result of the repurchase of all outstanding preferred shares in December 2017, there were no dividends paid for preferred shares for the three months ended March 31, 2018 versus $225,000 paid in preferred dividends for the same period in 2017.

Elmira Savings Bank, with $553.3 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with six offices in Chemung County, NY; three offices in Tompkins County, NY; two offices in Steuben County, NY; one office in Cayuga County, NY; one office in Schuyler County; and a loan center in Broome County, NY.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank’s regulatory reports.


ELMIRA SAVINGS BANK
CONSOLIDATED BALANCE SHEET
(unaudited)

(in thousands, except for share and per share data)	March 31,			December 31,
		2018			2017		% Change
ASSETS

Cash and due from banks	$	16,467		$	7,800		111.1	%
Federal funds sold and other short-term investments		96			97		-1.0	%
Total cash and cash equivalents		16,563			7,897		109.7	%

Securities available for sale, at fair value		23,009			24,056		-4.4	%
Securities held to maturity - fair value $8,104
at March 31, 2018, and $8,186 at December 31, 2017		7,893			8,039		-1.8	%
Federal Reserve and Federal Home Loan Bank (FHLB) stock, at cost		9,765			10,221		-4.5	%

Loans held for sale		892			1,999		-55.4	%

Loans receivable		451,564			458,629		-1.5	%
Less: Allowance for loan losses		4,433			4,442		-0.2	%
Net loans		447,131			454,187		-1.6	%

Premises and equipment, net		16,667			16,772		-0.6	%
Bank-owned life insurance		14,072			13,982		0.6	%
Accrued interest receivable		1,019			1,497		-31.9	%
Goodwill		12,320			12,320		0.0	%
Other assets		3,928			3,590		9.4	%
Total assets	$	553,259		$	554,560		-0.2	%

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits	$	456,322		$	456,762		-0.1	%
Borrowings		35,000			35,000		0.0	%
Other liabilities		5,050			6,117		-17.4	%
Total liabilities		496,372			497,879		-0.3	%

Shareholders' equity:
Preferred stock, $1,000 liquidation value per issued share; 5,000,000 shares
authorized; 10,000 shares issued at March 31, 2018 and at December 31, 2017		9,700			9,700		0.0	%
Common stock, $1 par value; 5,000,000 shares authorized; 3,419,879 shares
issued at March 31, 2018 and 3,410,622 shares issued at December 31, 2017		3,420			3,411		0.3	%
Additional paid-in capital		50,306			50,258		0.1	%
Retained earnings		5,865			5,493		6.8	%
Treasury stock, at cost - 93,883 common shares and 10,000 preferred shares
at March 31, 2018 and December 31, 2017		(12,202	)		(12,202	)	0.0	%
Accumulated other comprehensive loss		(254	)		(31	)	719.4	%
Total Elmira Savings Bank shareholders' equity		56,835			56,629		0.4	%
Noncontrolling interest		52			52		0.0	%
Total shareholders' equity		56,887			56,681		0.4	%
Total liabilities and shareholders' equity	$	553,259		$	554,560		-0.2	%

ELMIRA SAVINGS BANK
CONSOLIDATED STATEMENT OF INCOME
(unaudited)

	Three Months Ended
	March 31,
(in thousands, except for per share data)		2018		2017	% Change

Interest and dividend income:
Interest and fees on loans	$	4,796	$	4,735	1.3	%
Interest and dividends on securities
Taxable		252		244	3.3	%
Non-taxable		120		189	-36.5	%
Total interest and dividend income		5,168		5,168	0.0	%

Interest expense:
Interest on deposits		750		730	2.7	%
Interest on borrowings		243		265	-8.3	%
Total interest expense		993		995	-0.2	%
Net interest income		4,175		4,173	0.0	%
Provision for loan losses		42		40	5.0	%
Net interest income after provision for loan losses		4,133		4,133	0.0	%

Noninterest income:
Service fees		388		379	2.4	%
Gain on sale of loans held for sale		378		583	-35.2	%
Other service fees		193		176	9.7	%
Earnings on bank-owned life insurance		90		96	-6.3	%
Other		61		27	125.9	%
Total noninterest income		1,110		1,261	-12.0	%

Noninterest expense:
Salaries and benefits		1,947		1,959	-0.6	%
Net occupancy		429		412	4.1	%
Equipment		337		312	8.0	%
Marketing and public relations		221		200	10.5	%
Professional fees		177		168	5.4	%
Other		717		777	-7.7	%
Total noninterest expense		3,828		3,828	0.0	%
Income before income taxes		1,415		1,566	-9.6	%
Income taxes		284		487	-41.7	%
Net income		1,131		1,079	4.8	%
Less: Net income attributable to noncontrolling interest		-		-	-

Net income attibutable to Elmira Savings Bank		1,131		1,079	4.8	%

Dividend on preferred stock		-		225	-100.0	%
Income available to common shareholders	$	1,131	$	854	32.4	%


Basic earnings per share	$	0.34	$	0.31	9.7	%

Diluted earnings per share	$	0.34	$	0.31	9.7	%

Weighted average shares outstanding - basic		3,308,999		2,739,157	20.8	%

Weighted average shares outstanding - diluted		3,322,721		2,757,422	20.5	%

Dividends per share	$	0.23	$	0.23	0.0	%

ELMIRA SAVINGS BANK
AVERAGE BALANCES AND INTEREST RATES

(Dollars in Thousands)	For the Three Months Ended
	March 31, 2018						March 31, 2017
ASSETS:	Average Balance		Interest		Average Rate		Average Balance		Interest		Average Rate
Loans receivable	$	453,362	$	4,796	4.25	%	$	453,195	$	4,735	4.20	%
Federal funds sold and other short-term investments		433		2	1.33			1,887		2	0.45
Securities		41,519		370	3.59			49,696		431	3.48
Total interest-earning assets		495,314		5,168	4.19			504,778		5,168	4.11

Noninterest-earning assets		57,887						59,626

TOTAL ASSETS	$	553,201					$	564,404

LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits	$	381,823	$	750	0.80		$	388,286	$	730	0.76
Borrowings		35,515		243	2.73			42,205		265	2.51
Total interest-bearing liabilities		417,338		993	0.96			430,491		995	0.93

Noninterest-bearing liabilities		78,744						77,351
Shareholders' equity		57,119						56,562

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	553,201					$	564,404
Interest rate spread					3.23	%					3.18	%
Net interest income/margin			$	4,175	3.38	%			$	4,173	3.32	%

				Quarter Ended
(Dollars and Shares in Thousands, Except Per Share Data)				3/31/2018		12/31/2017		9/30/2017		6/30/2017		3/31/2017
Operating Data
	Net income		$	1,131	$	1,449	$	1,215	$	1,108	$	1,079
	Net interest income			4,175		4,142		4,047		4,186		4,173
	Provision for loan losses			42		580		120		155		40
	Non-interest income			1,110		1,198		1,626		1,352		1,261
	Non-interest expense			3,828		4,515		3,760		3,781		3,828
Performance Statistics
	Net interest margin			3.38%		3.31%		3.27%		3.36%		3.32%
	Annualized return on average assets			0.83%		1.03%		0.84%		0.79%		0.78%
	Annualized return on average equity			8.03%		9.04%		7.32%		7.01%		7.74%
	Annualized net loan charge-offs to avg loans			0.05%		0.46%		0.03%		0.13%		0.01%
	Net charge-offs			51		528		28		144		16
	Efficiency ratio			72.4%		84.6%		66.3%		68.3%		70.4%
Per Share Data
	Basic earnings per share		$	0.34	$	0.39	$	0.30	$	0.28	$	0.31
	Diluted earnings per share			0.34		0.39		0.30		0.28		0.31
	Dividend declared per share			0.23		0.23		0.23		0.23		0.23
	Book value			17.09		17.07		16.84		16.77		16.82
	Common stock price:
		High		20.95		20.90		21.10		21.75		21.75
		Low		20.15		18.90		19.80		19.65		20.28
		Close		20.50		20.45		20.10		20.30		21.60
	Weighted average common shares:
		Basic		3,309		3,302		3,298		3,154		2,739
		Fully diluted		3,323		3,316		3,312		3,170		2,757
	End-of-period common shares:
		Issued		3,420		3,411		3,409		3,405		2,850
		Treasury		94		94		94		94		94


Financial Condition Data:
General
	Total assets		$	553,259	$	554,560	$	565,042	$	574,332	$	556,644
	Loans, net			447,131		454,187		443,543		448,024		446,223
	Intangibles			12,320		12,320		12,324		12,329		12,334
	Total deposits			456,322		456,762		454,826		460,140		450,376
		Noninterest-bearing		73,540		74,072		75,625		77,027		71,870
		Savings		70,574		70,339		68,253		70,668		70,300
		NOW		86,205		86,799		87,612		86,896		86,633
		Money Market		22,928		25,363		25,184		24,859		27,697
		Time deposits		203,075		200,189		198,152		200,690		193,876
		Total interest-bearing deposits		382,782		382,690		379,201		383,113		378,506
	Shareholders' equity			56,887		56,681		65,590		65,280		56,103
Asset Quality
	Non-performing assets		$	3,181	$	2,933	$	3,793	$	3,494	$	4,234
	Non-performing assets to total assets			0.57%		0.53%		0.67%		0.61%		0.76%
	Allowance for loan losses			4,433		4,442		4,390		4,298		4,287
	Allowance for loan losses to total loans			0.98%		0.97%		0.98%		0.95%		0.95%
	Allowance for loan losses to
		non-performing loans		142.59%		153.97%		118.46%		129.15%		105.93%
	Non-performing loans to total loans			0.70%		0.64%		0.84%		0.74%		0.91%
Capitalization
	Shareholders' equity to total assets			10.28%		10.22%		11.61%		11.37%		10.08%

For further information contact:
Thomas M. Carr, President & CEO
Elmira Savings Bank
333 East Water Street
Elmira, New York 14901
(607) 735-8660
tcarr@elmirasavingsbank.com

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Elmira Savings Bank Reports First Quarter Earnings

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