Affinity Bancshares, Inc. (NASDAQ:“AFBI”) (the
“Company”), the holding company for Affinity Bank (the “Bank”),
today announced net income of $1.7 million for the three months
ended March 31, 2023, as compared to $1.8 million for the three
months ended March 31, 2022.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20230427005691/en/
At or for the three months
ended,
Performance Ratios:
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
March 31, 2022
Net income (in thousands)
$
1,722
$
1,699
$
1,861
$
1,783
$
1,791
Diluted earnings per share
0.26
0.26
0.27
0.27
0.26
Common book value per share
18.02
17.73
17.37
17.51
17.58
Tangible book value per share (1)
15.20
14.92
14.57
14.68
14.75
Total assets (in thousands)
932,302
791,283
776,390
766,679
760,208
Return on average assets
0.84
%
0.84
%
0.95
%
0.95
%
0.97
%
Return on average equity
5.90
%
5.78
%
6.30
%
6.13
%
5.97
%
Equity to assets
12.69
%
14.80
%
14.84
%
15.05
%
15.31
%
Tangible equity to tangible assets (1)
10.92
%
12.75
%
12.75
%
12.93
%
13.17
%
Net interest margin
3.58
%
3.85
%
4.12
%
4.06
%
4.47
%
Efficiency ratio
69.73
%
71.38
%
67.62
%
67.23
%
69.00
%
(1) Non-GAAP measure - see “Explanation of
Certain Unaudited Non-GAAP Financial Measures” for more information
and reconciliation to GAAP.
Net Income
- Net income was $1.7 million for the three months ended March
31, 2023, as compared to $1.8 million for the three months ended
March 31, 2022, as a result of an increase in deposit interest
expense offset by an increase in interest income and decreases in
noninterest expenses.
- Operating net income was $1.7 million and $0.26 diluted
earnings per share for the three months ended March 31, 2023, as
compared to $1.5 million and $0.22 diluted earnings per share for
the three months ended March 31, 2022.
Results of Operations
- Net interest income was $6.9 million for the three months ended
March 31, 2023 compared to $7.8 million for the three months ended
March 31, 2022, due to an increase in deposit costs and recognition
of remaining purchase accounting fair value discounts upon the
payoff of acquired Federal Home Loan Bank (FHLB) advances in the
first quarter of 2022, partially offset by an increase in interest
income on loans.
- Net interest margin for the three months ended March 31, 2023
decreased to 3.58% from 4.53% for the three months ended March 31,
2022. The Company anticipates it will experience continued margin
compression in 2023 as a result of recent increases in market
interest rates along with the mark on the FHLB advances from
acquisition that was recognized upon payoff in first quarter
2022.
- Noninterest income was $552 thousand for the three months ended
March 31, 2023 and $595 thousand for the three months ended March
31, 2022. The decrease was attributable to a decrease in mortgage
fee income.
- Non-interest expense was $5.2 million and $5.8 million for the
three months ended March 31, 2023 and 2022, respectively. The
decrease was a result of the FHLB prepayment penalties paid in
first quarter 2022.
Financial Condition
- Total assets increased $141.0 million to $932.3 million at
March 31, 2023 from $791.3 million at December 31, 2022 to further
enhance liquidity.
- Total net loans increased $15.3 million to $652.2 million at
March 31, 2023 from $636.9 million at December 31, 2022. The
increase was due to steady loan demand.
- Non-owner occupied office loans totaled $26.2 million at March
31, 2023; average LTV on these loans is 45%;
- $10.4 million medical/ dental tenants
- $15.8 million to other various tenants.
- Investment securities held-to-maturity unrealized losses were
$1.3 million, net of tax. Investment securities available-for-sale
unrealized losses were $6.2 million, net of tax.
- Cash and cash equivalents increased to $136.9 million at March
31, 2023 from $26.3 million at December 31, 2023, primarily due to
an increase in deposits.
- Deposits increased by $93.6 million to $750.8 million at March
31, 2023 compared to $657.2 million at December 31, 2022, in part
due to increases in certificates of deposits of $116.2 million
offset by $22.6 million decreases in non-time deposits, as
customers increased deposits in higher-yielding accounts during the
current interest rate environment. The certificates of deposits
increase included brokered deposits totaling $85.6 million with an
average life of three years and an average interest rate of
5.07%.
- Uninsured deposits were approximately $91.9 million and
represented 12.1% of total deposits.
- Borrowings increased by $45.0 million to $55.0 million at March
31, 2023 compared to $10.0 million at December 31, 2022 as we
continue to evaluate borrowing needs related to enhancing bank
liquidity.
Asset Quality
- Non-performing loans increased to $6.9 million at March 31,
2023 from $6.7 million at December 31, 2022.
- The allowance for credit losses as a percentage of
non-performing loans was 145.49% at March 31, 2023, as compared to
138.8% at December 31, 2022.
- Allowance for credit losses decreased to 1.40% at March 31,
2023 from 1.46% of total loans at December 31, 2022.
- Net loan charge-offs were $91 thousand for the three months
ended March 31, 2023, as compared to $3 thousand for the three
months ended March 31, 2022.
About Affinity Bancshares,
Inc.
The Company is a Maryland corporation based in Covington,
Georgia. The Company’s banking subsidiary, Affinity Bank, opened in
1928 and currently operates a full-service office in Atlanta,
Georgia, two full-service offices in Covington, Georgia, and a loan
production office serving the Alpharetta and Cumming, Georgia
markets.
Forward-Looking
Statements
In addition to historical information, this release may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, which describe the future
plans, strategies and expectations of the Company. Forward-looking
statements can be identified by the use of words such as
“estimate,” “project,” “believe,” “intend,” “anticipate,” “assume,”
“plan,” “seek,” “expect,” “will,” “may,” “should,” “indicate,”
“would,” “contemplate,” “continue,” “target” and words of similar
meaning. Forward-looking statements are based on our current
beliefs and expectations and are inherently subject to significant
business, economic and competitive uncertainties and contingencies,
many of which are beyond our control. In addition, these
forward-looking statements are subject to assumptions with respect
to future business strategies and decisions that are subject to
change. Accordingly, you should not place undue reliance on such
statements. We are under no duty to and do not take any obligation
to update any forward-looking statements after the date of this
report. Factors which could have a material adverse effect on the
operations of the Company and its subsidiaries include, but are not
limited to, changes in general economic conditions, interest rates
and inflation; changes in asset quality; our ability to access
cost-effective funding; fluctuations in real estate values; changes
in laws or regulations; changes in liquidity, including the size
and composition of our deposit portfolio and the percentage of
uninsured deposits in the portfolio; changes in technology;
failures or breaches of our IT security systems; our ability to
introduce new products and services and capitalize on growth
opportunities; our ability to successfully integrate acquired
operations or assets; changes in accounting policies and practices;
our ability to retain key employees; and the effects of natural
disasters and geopolitical events, including terrorism, conflict
and acts of war. These risks and other uncertainties are further
discussed in the reports that the Company files with the Securities
and Exchange Commission.
Average Balance Sheets
The following tables set forth average balance sheets, average
annualized yields and costs, and certain other information for the
periods indicated. No tax-equivalent yield adjustments have been
made, as the effects would be immaterial. All average balances are
monthly average balances. Non-accrual loans were included in the
computation of average balances. The yields set forth below include
the effect of deferred fees, discounts, and premiums that are
amortized or accreted to interest income or interest expense.
For the Three Months Ended
March 31,
2023
2022
Average Outstanding
Balance
Interest
Average Yield/Rate
Average Outstanding
Balance
Interest
Average Yield/Rate
(Dollars in thousands)
Interest-earning assets:
Loans
$
651,750
$
8,291
5.16
%
$
586,762
$
6,996
4.84
%
Investment securities held-to-maturity
32,898
503
6.20
%
—
—
—
Investment securities
available-for-sale
48,844
411
3.41
%
48,648
260
2.14
%
Interest-earning deposits and federal
funds
45,758
488
4.32
%
48,231
17
0.14
%
Other investments
2,643
35
5.39
%
1,000
6
2.33
%
Total interest-earning assets
781,893
9,728
5.05
%
684,641
7,279
4.25
%
Non-interest-earning assets
51,044
62,343
Total assets
832,937
$
746,984
Interest-bearing liabilities:
Interest-bearing checking accounts
$
91,856
$
45
0.20
%
$
96,273
$
42
0.17
%
Money market accounts
139,495
661
1.92
%
144,455
88
0.25
%
Savings accounts
95,897
552
2.34
%
86,195
83
0.38
%
Certificates of deposit
149,058
1,056
2.87
%
94,465
290
1.23
%
Total interest-bearing deposits
476,306
2,314
1.97
%
421,388
503
0.48
%
FHLB advances and other borrowings
46,723
516
4.48
%
8,821
(975
)
(44.20
)%
Total interest-bearing liabilities
523,029
2,830
2.19
%
430,209
(472
)
(0.44
)%
Non-interest-bearing liabilities
191,659
195,024
Total liabilities
714,688
625,233
Total stockholders' equity
118,249
121,751
Total liabilities and stockholders'
equity
$
832,937
$
746,984
Net interest rate spread
2.86
%
4.69
%
Net interest income
$
6,898
$
7,751
Net interest margin
3.58
%
4.53
%
AFFINITY BANCSHARES,
INC.
Consolidated Balance
Sheets
(unaudited)
March 31, 2023
December 31, 2022
(Dollars in thousands except
per share amounts)
Assets
Cash and due from banks
$
5,714
$
2,928
Interest-earning deposits in other
depository institutions
131,172
23,396
Cash and cash equivalents
136,886
26,324
Investment securities
available-for-sale
51,154
46,200
Investment securities held-to-maturity
(estimated fair value of $32,507)
34,119
26,527
Other investments
2,996
1,082
Loans, net
652,192
636,909
Other real estate owned
2,901
2,901
Premises and equipment, net
4,156
4,257
Bank owned life insurance
15,811
15,724
Intangible assets
18,510
18,558
Other assets
13,577
12,801
Total assets
$
932,302
$
791,283
Liabilities and Stockholders' Equity
Liabilities:
Non-interest-bearing checking
$
183,862
$
190,297
Interest-bearing checking
97,537
91,167
Money market accounts
134,872
148,097
Savings accounts
92,382
101,622
Certificates of deposit
242,186
125,989
Total deposits
750,839
657,172
Federal Home Loan Bank advances and other
borrowings
55,000
10,025
Accrued interest payable and other
liabilities
8,153
6,983
Total liabilities
813,992
674,180
Stockholders' equity:
Common stock (par value $0.01 per share,
40,000,000 shares authorized; 6,566,137 issued and outstanding at
March 31, 2023 and 6,605,384 issued and outstanding at December 31,
2022)
66
66
Preferred stock (10,000,000 shares
authorized, no shares outstanding)
—
—
Additional paid in capital
62,549
63,130
Unearned ESOP shares
(4,743
)
(4,795
)
Retained earnings
66,619
65,357
Accumulated other comprehensive loss
(6,181
)
(6,655
)
Total stockholders' equity
118,310
117,103
Total liabilities and stockholders'
equity
$
932,302
$
791,283
AFFINITY BANCSHARES,
INC.
Consolidated Statements of
Income
(unaudited)
Three Months Ended March
31,
2023
2022
(Dollars in thousands except
per share amounts)
Interest income:
Loans, including fees
$
8,291
$
6,996
Investment securities
949
266
Interest-earning deposits
488
17
Total interest income
9,728
7,279
Interest expense:
Deposits
2,314
503
FHLB advances and other borrowings
516
(975
)
Total interest expense
2,830
(472
)
Net interest income before provision for
credit losses
6,898
7,751
Provision for credit losses
7
250
Net interest income after provision for
credit losses
6,891
7,501
Noninterest income:
Service charges on deposit accounts
391
392
Other
161
203
Total noninterest income
552
595
Noninterest expenses:
Salaries and employee benefits
3,004
3,008
Occupancy
644
582
Advertising
97
80
Data processing
493
494
FHLB prepayment penalties
—
647
Other
956
947
Total noninterest expenses
5,194
5,758
Income before income taxes
2,249
2,338
Income tax expense
527
547
Net income
$
1,722
$
1,791
Weighted average common shares
outstanding
Basic
6,599,672
6,806,405
Diluted
6,681,680
6,908,665
Basic earnings per share
$
0.26
$
0.26
Diluted earnings per share
$
0.26
$
0.26
Explanation of Certain Unaudited
Non-GAAP Financial Measures
Reported amounts are presented in accordance with GAAP.
Additionally, the Company believes this 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 in accordance with GAAP, nor are they necessarily
comparable to non-GAAP performance measures which may be presented
by other companies. Refer to the Non-GAAP Reconciliation table
below for details on the earnings impact of these items.
At or For the Period
Ending
Non-GAAP Reconciliation
March 31, 2023
December 31, 2022
September 30, 2022
June 30, 2022
March 31, 2022
Operating net income
reconciliation
Net income (GAAP)
$
1,722
$
1,699
$
1,861
$
1,783
$
1,791
FHLB mark from called borrowings
—
—
—
—
988
FHLB prepayment penalties
—
—
—
—
647
Income tax expense
—
—
—
—
(87
)
Operating net income
$
1,722
$
1,699
$
1,861
$
1,783
$
1,537
Weighted average diluted shares
6,681,680
6,708,922
6,752,152
6,684,721
6,908,665
Adjusted earnings per share
$
0.26
$
0.26
$
0.27
$
0.27
$
0.22
Tangible book value per common share
reconciliation
Book Value per common share (GAAP)
$
18.02
$
17.73
$
17.37
$
17.51
$
17.58
Effect of goodwill and other
intangibles
(2.82
)
(2.81
)
(2.80
)
(2.83
)
(2.83
)
Tangible book value per common share
$
15.20
$
14.92
$
14.57
$
14.68
$
14.75
Tangible equity to tangible assets
reconciliation
Equity to assets (GAAP)
12.69
%
14.80
%
14.84
%
15.05
%
15.31
%
Effect of goodwill and other
intangibles
(1.77
)%
(2.05
)%
(2.09
)%
(2.12
)%
(2.14
)%
Tangible equity to tangible assets (1)
10.92
%
12.75
%
12.75
%
12.93
%
13.17
%
(1) Tangible assets is total assets less
intangible assets. Tangible equity is total equity less intangible
assets.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230427005691/en/
Edward J. Cooney Chief Executive Officer (678)742-9990
Affinity Bancshares (NASDAQ:AFBI)
Historical Stock Chart
Von Mai 2024 bis Jun 2024
Affinity Bancshares (NASDAQ:AFBI)
Historical Stock Chart
Von Jun 2023 bis Jun 2024