InsCorp's 3rd Quarter Earnings Driven by Loan & Margin Growth

Parent of Nashville-based INSBANK Declares Semi-Annual Dividend

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Nov 01, 2021, 20:41 ET

NASHVILLE, Tenn., Nov. 1, 2021 /PRNewswire/ -- InsCorp, Inc. (OTCQX: IBTN) in Nashville, and parent company of INSBANK, today reported third quarter earnings of $1,626,000, or $0.55 per share compared to $343,000 and $0.11 per share for the same period in 2020. Year-to-date earnings were $4,286,000, or $1.46 per share, which was a 164% increase over the prior year of $1,624,000 for the nine months ended September 30, 2020. This was the company's most profitable 3^rd quarter interim performance in its history. INSBANK's cost of interest-bearing deposits decreased 17 basis points during the quarter, continuing a trend for the Nashville-based lender as term deposits have repriced during the year. This, along with recognition of Paycheck Protection Program-related fees, contributed to a 21 basis point increase in net interest margin during the quarter.

Core loans, excluding PPP advances, increased $35.6 million during the quarter, driven by growth of the bank's niche medical division, Medquity, as well as commercial real estate loans. Loans, excluding PPP advances, were up more than 17% over the last 12 months, while total loans have grown 10% during the same period. "Our team remains focused on executing our strategy of balanced organic growth, both locally and within our nationwide physician-focused silos," said Jim Rieniets, President and CEO of INSBANK.

The company continues to derive benefit from its investments in technology, as evidenced by its operating efficiency and personnel leverage. The bank's measures of: efficiency ratio, operating expenses as a percentage of assets, and assets per employee all continue to compare favorably to its industry peer group and place it in the top quartile of those performance metrics. "Acceleration of digital trends by the pandemic has many community banks scrambling to find their place in the future of our industry," continued Rieniets. "A focus on fintech is not a bandwagon phenomenon at INSBANK; it's been a part of our DNA since the bank was founded over 20 years ago."

The board of directors also recently approved the payment of a semi-annual dividend. InsCorp shareholders of record November 19, 2021, will receive a $0.12 dividend payable on December 10, 2021. "While most of our earnings are needed to support the bank's growth, we're pleased to enhance our shareholders' value with a dividend yield," added Michael Qualls, Chairman of InsCorp.

Highlights of the quarter and year-over-year include:

Total assets grew $94 million year over year or 16% as of September 30, 2021.
Non-interest bearing deposits grew $17.5 million or 27.8% during the 12 months ended September 30, 2021.
Deferred loan fees related to the PPP loans is approximately $479,000 at September 30, 2021.
Efficiency ratio was 50.9% at September 30, 2021, comparing favorably to the bank's FDIC peer group average of 60.5%.
Non-Interest Expense to Total Average Assets was 1.66% for the nine months ended September 30, 2021, slightly lower than 1.74% for the same period in 2020 and compared favorably to the bank's FDIC peer group average of 2.41%.
Cost of all interest-bearing funding was 0.75% for the three months ended September 30, 2021 decreasing from 1.47% for the same period in 2020.
Assets per employee remained strong at $13.8 million, compared to the FDIC peer group of $6.7 million.
The bank's tier 1 capital ratio was 11.6%, while total risk-based capital was 12.9%.
The allowance for loan and lease losses was 1.42% exclusive of PPP loan balances.
Annualized return on tangible common equity for the year was 10.95% for the nine months ended September 30, 2021
Tangible book value increased $0.55 to $18.59 during the quarter primarily by virtue of retained earnings.
The percentage of loans past due and non-accrual to gross loans was 0.52% comparing favorably to peer of 0.86%.
Net charge-offs for the quarter ended September 30, 2021, were $25,000.

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)

		*September 30,*	*December 31,*	*September 30,*
		2021	2020	2020
Assets
Cash and Cash Equivalents		$ 16,400	$ 8,219	$ 8,476
Interest Bearing Deposits		58,738	33,356	25,415
Securities		17,513	17,039	19,304

Loans		549,510	525,235	500,133
Allowance for Loan Losses		(7,575)	(7,365)	(7,015)
Net Loans		541,935	517,870	493,118

Premises and Equipment, net		13,417	13,630	13,757
Bank Owned Life Insurance		13,318	10,115	10,052
Restricted Equity Securities		9,453	7,612	6,826
Goodwill and Related Intangibles, net		1,091	1,091	1,091
Other Assets		7,865	8,298	7,706

Total Assets		$ 679,730	$ 617,230	$ 585,745

Liabilities and Shareholders' Equity
Liabilities
Deposits
	Non-interest-bearing	$ 80,504	$ 52,665	$ 62,994
	Interest-bearing	478,533	417,731	384,684
	Total Deposits	559,037	470,396	447,678

Federal Home Loan Bank Advances		39,000	50,000	49,000
Paycheck Protection Program Liquidity Fund		4,932	18,412	18,412
Subordinated Debentures		15,000	15,000	15,000
Federal Funds Purchased		2,000	7,000	-
Other Liabilities		3,980	5,328	4,846
Total Liabilities		623,949	566,136	534,936

Shareholders' Equity
	Common Stock	31,662	31,190	31,190
	Treasury Stock	(663)	(681)	(278)
	Accumulated Retained Earnings	24,293	20,377	19,568
	Accumulated Other Comprehensive Income	489	208	329
	Total Stockholders' Equity	55,781	51,094	50,809
Total Liabilities & Shareholders' Equity		$ 679,730	$ 617,230	$ 585,745

Tangible Book Value		$ 18.59	$ 17.24	$ 16.98

InsCorp, Inc.
Consolidated Statements of Income
(000's)
(Unaudited)

		*Nine Months Ended*	*Twelve Months Ended*	*Nine Months Ended*
		*September 30, 2021*	*December 31, 2020*	*September 30, 2020*

Interest Income		$ 18,380	$ 22,694	$ 17,082
Interest Expense		3,752	7,221	5,638
Net Interest Income		14,628	15,473	11,444
Provision for Loan Losses		1,400	2,400	1,850
Non-Interest Income
	Service Charges on Deposit Accounts	180	212	154
	Bank Owned Life Insurance	202	251	187
	Gain on Int Rate Hedges and Sec sales	206	-	-
	Other	892	705	534
Non-Interest Expense
	Salaries and Benefits	5,098	6,200	4,598
	Occupancy and equipment	984	1,233	896
	Data Processing	446	553	410
	Marketing and Advertising	404	349	247
	Other	1,530	1,843	1,439
Net income from Operations		6,246	4,063	2,879

Interest Expense-Subordinated Debt		717	956	717
Income Before Income Taxes		5,529	3,107	2,162
Income Tax Expense		(1,243)	(674)	(538)
Net Income		$ 4,286	$ 2,433	$ 1,624

Return on Weighted Average Common Shares		$ 1.46	$ 0.83	$ 0.55