NORTHEAST INDIANA BANCORP, INC. ANNOUNCES THIRD QUARTER 2023 EARNINGS

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Oct 26, 2023, 15:30 ET

HUNTINGTON, Ind., Oct. 26, 2023 /PRNewswire/ -- Northeast Indiana Bancorp, Inc. (OTCQB: NIDB), the parent company of First Federal Savings Bank, today announced net income for the nine months ended September 30, 2023, was $3.5 million, or $1.46 per diluted common share, compared to net income of $5 million, or $2.08 per diluted common share for the nine months ended September 30, 2022. The current nine months earnings equate to an annualized ROA of 1.01% and an annualized ROE of 10.72% compared to an annualized ROA of 1.58% and an annualized ROE of 14.94% for the nine months ended September 30, 2022.

Net income for the third quarter ended September 30, 2023, was $1.2 million, or $0.51 per diluted common share, compared to net income of $1.6 million, or $0.68 per diluted common share for the third quarter ended September 30, 2022. The current quarter earnings equate to an annualized return on average assets (ROA) of 1.02% and an annualized return on average equity (ROE) of 11.16% compared to an annualized ROA of 1.53% and an annualized ROE of 15.09% for the third quarter September 30, 2022.

A decrease in net interest income and an increase in overhead expenses have been the primary contributing factors to the declines in net income. Net Interest Income was down $533,000 through the first nine months of 2023 compared to the same period in 2022. Payroll and employee benefit expenses increased $542,000 in 2023 compared to the same period in 2022. Provision for loan loss expense was up $270,000 year-to-date in 2023 compared to the first nine months of 2022. The Company continues to evaluate allowance for credit loss levels given the current year's loan growth and performance in this first year of adopting the new CECL accounting standard. In addition, the gain on sale of mortgage loans decreased by $286,000 for the first nine months of 2023 compared to the same period in 2022.

Total Assets increased $38.9 million to $484.4 million at September 30, 2023 compared to $445.5 million at December 31, 2022. Net loans increased $38.6 million, or 16% on an annualized basis to $359.3 million at September 30, 2023 compared to $320.7 million at December 31, 2022. Total deposits increased $24.7 million, or 9% on an annualized basis to $391.5 million at September 30, 2023 compared to $366.8 million at December 31, 2022. Stockholder's equity increased to $43.8 million at September 30, 2023 compared to $43.1 million at December 31, 2022. The book value of NIDB's stock was $18.08 per common share and tangible common equity ratio was 9.05% as of September 30, 2023.

Michael S. Zahn, President, and CEO commented "In a challenging banking environment, we continue to experience excellent growth. With the rapid increases in interest rates by the Federal Reserve to combat inflation, margins continue to be under pressure. We are in a positive position to navigate the uncertain interest rate waters that lie ahead. Our focus on the success of our customers while investing in our employees should continue to serve our communities and enhance shareholder value."

*All share data has been adjusted to reflect Northeast Indiana Bancorp, Inc.'s two-for-one stock split effective July 14, 2023.

Northeast Indiana Bancorp, Inc. is headquartered at 648 N. Jefferson Street, Huntington, Indiana. The company offers a full array of banking and financial brokerage services to its customers through its main office in Huntington and six full-service Indiana offices in Huntington (2), Warsaw (2) and Fort Wayne (2). The Company is traded on the OTC Markets Group, Inc. (www.otcmarkets.com) utilizing the OTCQB platform under the symbol "NIDB". Our web site address is www.firstfedindiana.bank.

This press release may contain forward-looking statements, which are based on management's current expectations regarding economic, legislative and regulatory issues. Factors which may cause future results to vary materially include, but are not limited to, general economic conditions, changes in interest rates, loan demand, and competition. Additional factors include changes in accounting principles, policies or guidelines; changes in legislation or regulation; and other economic, competitive, regulatory and technological factors affecting each company's operations, pricing, products and services.

NORTHEAST INDIANA BANCORP
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

	September 30,	December 31,	September 30,
Balance Sheet (Unaudited)	2023	2022	2022
		(Audited)
*Assets*
Non-interest earning cash and cash equivalents	$ 4,452,087	$ 3,141,705	$ 3,531,435
Interest-earning cash and cash equivalents	1,170,142	747,920	930,052
Total cash and cash equivalents	5,622,229	3,889,625	4,461,487
Interest-earning time deposits	4,324,000	1,230,000	985,000
Securities available for sale	72,562,496	78,273,337	77,283,002
Securities held to maturity	12,765,697	12,062,446	12,072,056
Loans held for sale	286,205	189,600	494,900
Loans, gross	363,830,115	324,752,497	308,763,256
Allowance for loan losses	(4,529,632)	(3,996,619)	(4,024,366)
Loans, net	359,300,483	320,755,878	304,738,890
Accrued interest receivable	2,238,906	1,923,986	1,742,598
Premises and equipment	7,075,694	7,254,951	7,211,971
FHLB Stock	2,182,500	2,101,600	2,101,600
Investment in limited partnerships	1,003,334	1,228,334	1,303,334
Cash surrender value of life insurance	11,675,890	11,629,618	11,554,663
Real estate owned and other repossessed assets	-	-	-
Other assets	5,389,135	4,988,219	5,484,511
Total Assets	$ 484,426,569	$ 445,527,594	$ 429,434,012

*Liabilities and Stockholders' Equity*
Non-interest bearing deposits	$ 56,131,800	$ 53,232,315	$ 66,847,065
Interest bearing deposits	335,395,992	313,584,014	289,856,179
Borrowed funds	45,000,000	32,000,000	28,000,000
Accrued interest payable and other liabilities	4,049,508	3,584,163	2,729,801
Total Liabilities	440,577,300	402,400,492	387,433,045
Stockholders' equity	43,849,269	43,127,102	42,000,967
Total Liabilities and Stockholders' Equity	$ 484,426,569	$ 445,527,594	$ 429,434,012

	Three months ended			Nine months ended
	September 30,	June 30,	September 30,	September 30,	September 30,
Income Statement (Unaudited)	2023	2023	2022	2023	2022

*Net interest income*
Total interest income	$ 6,354,262	$ 5,713,346	$ 4,456,152	$ 17,455,735	$ 12,480,325
Total interest expense	2,610,737	2,260,069	509,035	6,632,701	1,124,663
Net interest income	3,743,525	3,453,277	3,947,117	10,823,034	11,355,662
Provision for loan losses	90,000	90,000	-	270,000	-
Net interest income after provision for loan losses	3,653,525	3,363,277	3,947,117	10,553,034	11,355,662

*Non-interest income*
Service charges on deposit accounts	184,111	177,656	201,818	549,989	542,615
Interchange fees	199,248	200,186	201,646	591,772	590,520
Loan servicing fees	102,753	-	98,371	306,526	291,297
Net gain on sale of loans	115,722	79,680	114,804	261,195	547,282
Net loss on sale of repossessed assets	-	-	-	-	-
Brokerage fees	44,957	43,798	51,158	155,240	162,324
Increase in cash surrender value of life insurance	74,217	73,360	74,604	221,226	222,722
Other income	37,652	376,994	80,456	384,883	248,521
Total non-interest income	758,660	951,674	822,857	2,470,832	2,605,281

*Non-interest expense*
Salaries and employee benefits	1,604,968	1,680,705	1,510,552	4,972,918	4,254,907
Occupancy	330,735	369,466	372,801	1,041,135	984,095
Data processing	397,132	394,044	371,686	1,185,772	1,089,502
Deposit insurance premiums	46,000	56,000	28,500	151,500	87,500
Professional fees	173,208	143,224	117,130	427,468	340,626
Advertising and marketing fees	13,909	76,513	83,237	182,139	179,008
Correspondent bank charges	35,395	35,342	32,669	109,468	89,721
Other expense	386,385	292,984	307,363	923,389	918,003
Total non-interest expense	2,987,732	3,048,278	2,823,938	8,993,789	7,943,362

Income before income taxes	1,424,453	1,266,673	1,946,036	4,030,077	6,017,581
Income tax expense	193,172	149,993	323,085	511,659	1,017,989
Net income	$ 1,231,281	$ 1,116,680	$ 1,622,951	$ 3,518,418	$ 4,999,592

	Three months ended			Nine months ended
	September 30,	June 30,	September 30,	September 30,	September 30,
Selected Financial Ratios and Other Financial Data (Unaudited)	2023	2023	2022	2023	2022

Average shares outstanding - basic	2,402,070	2,402,070	2,399,770	2,401,809	2,399,178
Average shares outstanding - diluted	2,402,094	2,402,070	2,399,914	2,401,846	2,399,553
Basic earnings per share	$ 0.51	$ 0.46	$ 0.68	$ 1.46	$ 2.08
Diluted earnings per share	$ 0.51	$ 0.46	$ 0.68	$ 1.46	$ 2.08
Net interest margin	3.21 %	3.09 %	3.88 %	3.22 %	3.77 %
Return on average assets	1.02 %	0.96 %	1.53 %	1.01 %	1.58 %
Return on average equity	11.16 %	10.16 %	15.09 %	10.72 %	14.94 %
Efficiency ratio	66.36 %	69.20 %	59.20 %	67.65 %	56.90 %

*Allowance for loan losses:*
Balance, beginning of period	$ 4,508,446	$ 4,421,505	$ 3,982,194	$ 3,996,619	$ 3,998,392
Charge-offs:
One-to-four family	21,457	6,009	-	27,466	-
Commercial real estate	-	-	-	-	-
Land/land development	-	-	-	-	-
Commercial	-	-	-	-	-
Consumer	73,324	20,811	21,604	130,265	79,111
Gross charge-offs	94,781	26,820	21,604	157,731	79,111
Recoveries:
One-to-four family	586	-	661	586	2,590
Commercial real estate	-	-	108	-	439
Land/land development	-	-	-	-	-
Commercial	600	2,207	40,000	3,730	49,725
Consumer	24,780	21,554	23,007	66,427	52,331
Gross recoveries	25,966	23,761	63,776	70,743	105,085
Net charge-offs (recoveries)	68,815	3,059	(42,172)	86,988	(25,974)
CECL adjustment	-	-	-	350,000
Provision for loan losses	90,000	90,000	-	270,000	-
Balance, end of period	$ 4,529,631	$ 4,508,446	$ 4,024,366	$ 4,529,631	$ 4,024,366

Net loan charge-offs (recoveries) to average loans	0.08 %	0.00 %	-0.06 %	0.03 %	-0.01 %

	As of
	September 30,	June 30,	September 30,
*Non-performing assets*	2023	2023	2022
Loans:
Non-accrual	$ 3,667,841	$ 6,302,505	$ 2,683,491
Past 90 days or more and still accruing	-	-	-
Troubled debt restructured	524,970	525,020	525,383
Total non-performing loans	4,192,811	6,827,525	3,208,874
Real estate owned	-	-	-
Other repossessed assets	-	-	-
Total non-performing assets	$ 4,192,811	$ 6,827,525	$ 3,208,874

Non-performing assets to total assets	0.87 %	1.44 %	0.75 %
Non-performing loans to gross loans	1.15 %	1.94 %	1.04 %
Allowance for loan losses to non-performing loans	108.03 %	66.03 %	125.41 %
Allowance for loan losses to gross loans	1.24 %	1.28 %	1.30 %

*Other financial ratios*
Tangible common equity	9.05 %	9.29 %	9.78 %
Book value per share	$ 18.08	$ 18.21	$ 17.43
Common shares outstanding	2,425,670	2,425,670	2,410,270

(1) Ratios for three and nine-month periods are annualized
(2) All share data has been adjusted for the 2:1 stock split on July 14, 2023.