InsCorp Quarterly Profits Reflect Benefits of Balance Sheet Strategies
Nashville-based Lender Increases Semi-Annual Dividend 25%
NASHVILLE, Tenn., May 3, 2022 /PRNewswire/ -- InsCorp, parent company to INSBANK (OTCQX:IBTN) today reported first quarter earnings of $3,204,000, or $1.12 per share, an increase of 149% over the prior year same quarter. At the bank level, net interest income was $5,078,000, representing a 15% increase over the prior year. Pre-tax income from operations was $1,973,000, an increase of $489,000 over Q1 2021. In addition to income from operations, realized and unrealized gains on interest rate caps of $1,887,000, net of tax, were a driver of earnings, which was a record for the company in a single quarter.
"During the pandemic we executed hedging strategies to protect margin from further volatility during 2021 as we re-priced maturing deposits," said Jim Rieniets, President and CEO of INSBANK. "Fortunately those liabilities re-priced before recent volatility witnessed during the first quarter of this year, which resulted in an opportunity to enhance our capital base with gains on those interest rate caps," Rieniets continued.
Core deposits grew by $27,000,000 during the quarter to $511,000,000, while core loans (excluding Paycheck Protection Program loans) grew $4,500,000. Total new loan commitments closed during the quarter were roughly $40,000,000, while funding under those commitments was approximately $25,000,000. Net loan growth was impacted by payoffs primarily from clients selling commercial real estate and other assets. "While net loan growth was ultimately lighter than expected, our loan pipeline both extended and grew during the quarter," said Rieniets. "Activity in our market remains very vibrant and our team is busy managing the pipeline of opportunities before us, both in our core commercial banking unit as well as our Medquity healthcare silos," Rieniets continued.
The board of directors also recently approved the payment of a semi-annual dividend. InsCorp shareholders of record as of May 20, 2022, will receive a $0.15 dividend payable on June 10, 2022. This is an increase of 25% over the company's most recent semi-annual dividends. "With the trajectory of earnings our team has established, we're pleased to be able to further enhance our shareholders' total return with an increase in the dividend," said Michael Qualls, Chairman of InsCorp.
Highlights of the quarter and year-over-year include
- Total assets grew $88 million or 13.9% as of March 31, 2022 compared to March, 31 2021.
- Non-interest bearing deposits grew $11.3 million or 15.6% during the 12 months ended March 31, 2022.
- Deferred loan fees related to the PPP loans is approximately $185,000 on March 31, 2022.
- Non-Interest Expense to Total Average Assets was 1.79% for the quarter ended March 31, 2022, slightly higher than 1.70% for the same period in 2021 and compared favorably to the bank's FDIC peer group average of 2.32%.
- Cost of all interest-bearing funding was 0.69% for the three months ended March 31, 2022 decreasing from 1.33% for the same period in 2021.
- Assets per employee remained strong at $15.05 million, compared to the FDIC peer group of $6.91 million.
- The bank's tier 1 capital ratio was 12.27%, while total risk-based capital was 13.52%.
- The allowance for loan and lease losses was 1.50% exclusive of PPP loan balances.
- Earnings per share for the first quarter of 2022 was $1.12.
- Tangible book value increased to $19.89 on March 31, 2022 from $17.69 at March 31, 2021.
- The percentage of loans past due and non-accrual to gross loans was 0.47% comparing favorably to peer of 0.76%.
- There were $23,000 in net recoveries for the quarter ended March 31, 2022.
- Accumulated Other Comprehensive Income (AOCI) reflected a loss on the securities portfolio offset by gains on interest rate swaps held by the bank for interest rate risk purposes, resulting in a 0.9% decrease in AOCI for the three months ended March 31, 2022.
About INSBANK
Since 2000, INSBANK has offered its clients highly personalized service provided by experienced relationship managers, while positioning itself as an innovator, utilizing technologies to deliver those services efficiently and conveniently. In addition to its commercial focused operation, INSBANK operates three divisions, Medquity, TMA Medical Banking and INSBANK Online. Medquity offers healthcare banking solutions to individuals nationwide, whether they are still in residency, practicing or entering retirement, while TMA Medical Banking provides banking services specifically to members of the Tennessee Medical Association. INSBANK Online offers nationally available virtual private client services for interest bearing deposits. INSBANK is owned by InsCorp, Inc., a Tennessee bank holding company. The bank is headquartered in Nashville at 2106 Crestmoor Road, and has an office in Brentwood at 5614 Franklin Pike Circle. For more information, please visit www.insbank.com
InsCorp, Inc. | |||||||||
Consolidated Balance Sheets | |||||||||
(000's) | |||||||||
(unaudited) | |||||||||
March 31, | December 31, | March 31, | |||||||
2022 | 2021 | 2021 | |||||||
Assets | |||||||||
Cash and Cash Equivalents | $ 17,258 | $ 16,680 | $ 15,561 | ||||||
Interest Bearing Deposits | 90,288 | 73,746 | 32,268 | ||||||
Securities | 27,545 | 21,606 | 12,747 | ||||||
Loans | 552,473 | 551,463 | 543,178 | ||||||
Allowance for Loan Losses | (8,193) | (8,025) | (7,515) | ||||||
Net Loans | 544,280 | 543,438 | 535,663 | ||||||
Premises and Equipment, net | 13,275 | 13,345 | 13,519 | ||||||
Bank Owned Life Insurance | 13,477 | 13,398 | 10,176 | ||||||
Restricted Equity Securities | 9,225 | 9,054 | 8,147 | ||||||
Goodwill and Related Intangibles, net | 1,091 | 1,091 | 1,091 | ||||||
Other Assets | 8,490 | 8,247 | 7,549 | ||||||
Total Assets | $ 724,929 | $ 700,605 | $ 636,721 | ||||||
Liabilities and Shareholders' Equity | |||||||||
Liabilities | |||||||||
Deposits | |||||||||
Non-interest-bearing | $ 84,190 | $ 79,929 | $ 72,858 | ||||||
Interest-bearing | 529,316 | 504,781 | 432,295 | ||||||
Total Deposits | 613,506 | 584,710 | 505,153 | ||||||
Federal Home Loan Bank Advances | 30,000 | 32,000 | 45,000 | ||||||
Paycheck Protection Program Liquidity Fund | 322 | 1,404 | 15,485 | ||||||
Subordinated Debentures | 17,500 | 17,500 | 15,000 | ||||||
Federal Funds Purchased | - | 4,000 | - | ||||||
Notes Payable | 2,500 | 2,500 | - | ||||||
Other Liabilities | 2,885 | 3,278 | 3,117 | ||||||
Total Liabilities | 666,713 | 645,392 | 583,755 | ||||||
Shareholders' Equity | |||||||||
Common Stock | 32,241 | 32,087 | 31,325 | ||||||
Treasury Stock | (3,150) | (3,150) | (681) | ||||||
Accumulated Retained Earnings | 28,543 | 25,689 | 21,652 | ||||||
Accumulated Other Comprehensive Income | 582 | 587 | 670 | ||||||
Total Stockholders' Equity | 58,216 | 55,213 | 52,966 | ||||||
Total Liabilities & Shareholders' Equity | $ 724,929 | $ 700,605 | $ 636,721 | ||||||
Tangible Book Value | $ 19.89 | $ 18.90 | $ 17.69 | ||||||
InsCorp, Inc. | |||||||||
Consolidated Statements of Income | |||||||||
(000's) | |||||||||
(Unaudited) | |||||||||
Three Months Ended | Twelve Months Ended | Three Months Ended | |||||||
March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||
Interest Income | $ 6,013 | $ 24,901 | $ 5,876 | ||||||
Interest Expense | 935 | 4,690 | 1,431 | ||||||
Net Interest Income | 5,078 | 20,211 | 4,445 | ||||||
Provision for Loan Losses | 145 | 1,850 | 650 | ||||||
Non-Interest Income | |||||||||
Service Charges on Deposit Accounts | 57 | 240 | 59 | ||||||
Bank Owned Life Insurance | 79 | 283 | 60 | ||||||
Gain on Security Sales | - | 62 | 62 | ||||||
Other | 221 | 1,114 | 237 | ||||||
Non-Interest Expense | |||||||||
Salaries and Benefits | 2,035 | 7,332 | 1,654 | ||||||
Occupancy and equipment | 433 | 1,347 | 325 | ||||||
Data Processing | 154 | 597 | 147 | ||||||
Marketing and Advertising | 128 | 574 | 100 | ||||||
Other | 567 | 2,373 | 503 | ||||||
Net income from Operations | 1,973 | 7,837 | 1,484 | ||||||
Gain in Interest Rate Hedges | 2,516 | 748 | 443 | ||||||
Interest Expense-Subordinated Debt | 233 | 992 | 239 | ||||||
Income Before Income Taxes | 4,256 | 7,593 | 1,688 | ||||||
Income Tax Expense | (1,052) | (1,564) | (398) | ||||||
Net Income | $ 3,204 | $ 6,029 | $ 1,290 | ||||||
Return on Weighted Average Common Shares | $ 1.12 | $ 2.06 | $ 0.44 | ||||||
SOURCE INSBANK
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