C&F Financial Corporation (the Corporation) (NASDAQ: CFFI), the
one-bank holding company for C&F Bank, today reported
consolidated net income of $5.7 million for the first quarter of
2022, which represents a decrease of $1.4 million, or 20.0 percent,
as compared to the first quarter of 2021. Adjusted net income
decreased $1.5 million, or 20.8 percent, for the first quarter of
2022 compared to the first quarter of 2021.
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Reported |
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Adjusted1 |
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For The Quarter Ended |
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For The Quarter Ended |
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Consolidated Financial
Highlights (unaudited) |
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3/31/22 |
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3/31/21 |
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3/31/22 |
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3/31/21 |
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Net income (000's) |
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$ |
5,735 |
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$ |
7,165 |
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$ |
5,672 |
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$ |
7,165 |
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Earnings per share - basic and
diluted |
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$ |
1.59 |
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$ |
1.92 |
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$ |
1.57 |
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$ |
1.92 |
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Annualized return on average
assets |
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1.01 |
% |
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1.36 |
% |
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1.00 |
% |
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1.36 |
% |
Annualized return on average
equity |
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10.99 |
% |
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15.16 |
% |
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10.87 |
% |
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15.16 |
% |
________________________1The Corporation uses
non-GAAP measures of financial performance, including adjusted net
income, adjusted earnings per share, adjusted annualized return on
average assets (ROA) and adjusted annualized return on average
equity (ROE), to provide meaningful information about operating
performance by excluding the effects of certain items that
management does not expect to have an ongoing impact on
consolidated net income. Adjusted net income for the first quarter
of 2022 excludes the effects of branch consolidation activity.
There were no such adjustments for the first quarter of 2021. For
more information about these financial measures, which are not
calculated in accordance with generally accepted accounting
principles (GAAP), please see “Use of Certain Non-GAAP Financial
Measures” and “Reconciliation of Certain Non-GAAP Financial
Measures,” below.
Tom Cherry, President and Chief Executive
Officer of C&F Financial Corporation, commented, “Our first
quarter results demonstrate that we are well positioned for the
challenges and opportunities presented by current market
conditions. The community banking segment continues to grow loans
and deposits and we believe it is poised to benefit from recent
increases in interest rates through expanded net interest margins.
The consumer finance segment is delivering outstanding growth in
its loan portfolio. And while mortgage volume has subsided from the
highs of 2020 and 2021, the mortgage banking segment’s traditional
focus on purchase lending will help us to remain competitive as
refinancing activity is likely to continue to decline across the
industry. We are watchful of the effect that inflation is having on
our customers, our communities and on our own operating costs.
Earnings and asset quality remain strong, and we are optimistic
about our prospects for responsible growth as we continue to carry
out our strategic objectives throughout 2022.”
Key highlights for the first quarter of 2022 are
as follows. Comparisons are to the first quarter of 2021 unless
otherwise stated.
- Average loans outstanding at the
community banking segment, excluding Paycheck Protection Program
(PPP) loans, increased 6.3 percent;
- Average deposits increased 8.1
percent;
- Average loans outstanding at the
consumer finance segment increased 21.3 percent;
- The Corporation recorded a net
reversal of provision for loan losses of $328,000 for first quarter
of 2022 on a consolidated basis, due primarily to the resolution of
certain impaired loans at the community banking segment and other
reserve releases, partially offset by provision for loan growth at
the consumer finance and community banking segments. The
Corporation recorded provision for loan losses of $280,000 for the
first quarter of 2021;
- The community banking segment
recognized net PPP origination fees of $437,000 in the first
quarter of 2022, compared to $864,000 in the first quarter of
2021;
- Consolidated annualized net
interest margin was 3.93 percent for the first quarter of 2022,
compared to 4.33 percent and 4.09 percent for the first quarter of
2021 and fourth quarter of 2021, respectively. The decrease in the
first quarter of 2022 compared to the fourth quarter of 2021 was
due primarily to growth in lower yielding cash and investments
while loans held for sale decreased, as well as lower accretion of
net PPP origination fees;
- The consumer finance segment
experienced net charge-offs at an annualized rate of 0.04 percent
of average total loans for the first quarter of 2022, compared to
net recoveries of 0.14 percent for the year ended December 31,
2021. Delinquencies remain lower than pre-pandemic levels and a
strong used car market has mitigated losses on defaulted
loans;
- The consumer finance segment’s
average loan yield declined as a result of pursuing growth in
higher quality, lower yielding loans; and
- Mortgage banking segment loan
originations decreased 55.1 percent for the first quarter of 2022
amid declines in mortgage industry volume and rising interest
rates.
Community Banking
Segment. The community banking segment
reported net income of $3.5 million for the first quarter of 2022,
compared to $2.8 million for the same period in 2021.
Community banking segment net income increased
$724,000 for the first quarter of 2022 compared to the first
quarter of 2021 due primarily to:
- a reversal of provision for loan
losses of $700,000 in the first quarter of 2022, due primarily to
the resolution of certain impaired loans and continued strong
credit quality of the loan portfolio, compared to no provision for
loan losses in the first quarter of 2021, and
- lower interest expense due to lower
average cost of time deposits and a shift in balances from time
deposits toward lower-cost savings, money market and demand
deposits;
partially offset by:
- lower interest income as a result
of lower accretion of net PPP origination fees and lower interest
income on purchased credit impaired (PCI) loans, as well as lower
average yields on other loans, partially offset by higher average
balances of securities, loans (excluding PPP loans) and cash.
Average loans decreased $22.5 million, or 2.1
percent, for the first quarter of 2022, compared to the same period
in 2021. Excluding the impact of PPP loans, average loans increased
$60.1 million, or 6.3 percent, for the first quarter of 2022,
compared to the same period in 2021. The increase in average loans
outstanding excluding PPP loans for the first quarter 2022 compared
to the same period in 2021 resulted primarily from growth in the
commercial real estate segment of the loan portfolio. Average
deposits increased $144.2 million, or 8.1 percent, for the first
quarter of 2022, compared to the same period in 2021, and the mix
of deposit balances shifted away from time deposits and toward
lower cost savings, money market and demand deposits.
Average loan yields were lower for the first
quarter of 2022 compared to the same period in 2021, due primarily
to lower recognition of net origination fees on PPP loans and lower
interest income on PCI loans. PPP loans earn interest
at a note rate of one percent as well as net origination fees that
are amortized over the contractual term of the related loan or
accelerated into interest income upon repayment of the loan. Net
PPP origination fees recognized in the first quarter of 2022 were
$437,000, compared to $864,000 for the same period in 2021. Since
the second quarter of 2020, the community banking segment has
recognized $6.1 million of net fees under the PPP, and there were
unrecognized net deferred PPP fees at March 31, 2022 of $242,000,
which are expected to be recognized in 2022. The recognition of
interest income on PCI loans, which were acquired in connection
with past mergers and acquisitions, is based on management’s
expectation of future payments of principal and interest, which are
inherently uncertain. Earlier than expected repayments of certain
PCI loans resulted in the recognition of additional interest income
during the first quarters of 2022 and 2021. Interest income
recognized on PCI loans was $363,000 for the first quarter of 2022
and $517,000 for the first quarter of 2021. During the first
quarter of 2022, market interest rates increased, which the
community banking segment expects to result in increases in net
interest income at the community banking segment in future periods.
However, how, when and the extent to which rising interest rates
will affect net interest income at the community banking segment is
uncertain.
C&F Bank’s total nonperforming assets were
$118,000 at March 31, 2022 compared to $3.2 million at December 31,
2021. Nonperforming assets included $118,000 in nonaccrual loans at
March 31, 2022 and included $2.4 million in nonaccrual loans and
$835,000 in other real estate owned (OREO) at December 31, 2021.
The decrease in nonaccrual loans at March 31, 2022 as compared to
December 31, 2021 was primarily due to the resolution of certain
impaired loans during the first quarter of 2022. The community
banking segment recorded a net reversal of provision for loan
losses of $700,000 for the first quarter of 2022, compared to no
provision for loan losses recorded for the first quarter of 2021.
At March 31, 2022, the allowance for loan losses decreased to $14.1
million, compared to $14.8 million at December 31, 2021. Decreases
in the allowance for loan losses during 2022 related to improvement
in asset quality during 2022, including impaired loans, and a
release of certain qualitative adjustments to reserves related to
the COVID-19 pandemic, which were partially offset by provision
related to growth in the loan portfolio. Management believes that
the level of the allowance for loan losses is sufficient to absorb
losses inherent in the portfolio.
Mortgage Banking
Segment. The mortgage banking segment reported net
income of $866,000 for the first quarter of 2022, compared to net
income of $2.5 million for the same period in 2021.
The decrease in net income of the mortgage
banking segment for the first quarter of 2022 compared to the first
quarter of 2021 was due primarily to (1) lower volume of mortgage
loan originations and mortgage lender services and (2) lower
margins on sales of mortgage loans, partially offset by lower
provision for indemnification losses.
Mortgage loan originations for the mortgage
banking segment were $189.9 million for the first quarter of 2022,
compared to $422.5 million for the first quarter of 2021. Mortgage
loan originations for the mortgage banking segment during the first
quarter of 2022 for refinancings and home purchases were $48.4
million and $141.5 million, respectively, compared to $235.2
million and $187.3 million, respectively, during the first quarter
of 2021. Following the elevated volume levels in the
mortgage industry during 2020 and 2021 that accompanied
historically low mortgage interest rates and a highly active
residential real estate market, the first quarter of 2022
represents a return to levels of mortgage banking segment volume
(of both refinancings and home purchases), revenues and net income
that are somewhat normalized and still compare favorably to periods
prior to 2020.
During the first quarter of 2022, the mortgage
banking segment recorded a reversal of provisions for
indemnification losses of $583,000, compared to provision for
indemnification losses of $17,000 in the first quarter of 2021. The
release of indemnification reserves in the first quarter of 2022
was due primarily to improvement in the mortgage banking segment’s
assessment of borrower payment performance and other factors
affecting expected losses on mortgage loans sold in the secondary
market. The mortgage banking segment increased reserves for
indemnification losses during 2020 based on widespread forbearance
on mortgage loans and economic uncertainty related to the COVID-19
pandemic. To date, the mortgage banking segment has not made any
payments for indemnification losses since the onset of the COVID-19
pandemic, and management believes that the indemnification reserve
is sufficient to absorb losses related to loans that have been sold
in the secondary market.
Consumer Finance
Segment. The consumer finance segment reported net
income of $2.1 million for the first quarter of 2022, compared to
net income of $2.5 million for the same period in 2021.
Net income for the consumer finance segment
decreased $465,000 for the first quarter of 2022 compared to the
first quarter of 2021 due to lower yields on automobile loans and
higher provision for loan losses, partially offset by loan growth.
Provision for loan losses increased as a result of significant loan
growth in 2022, partially offset by a release of reserves related
to continued improvement in loan performance. Average yields on
loans decreased for the first quarter of 2022 compared to the same
period in 2021 as a result of the consumer finance segment’s
pursuing growth in higher quality, lower yielding loans.
Average loans outstanding increased $66.9
million, or 21.3%, for the first quarter of 2022 compared to the
same period in 2021. The consumer finance segment experienced
annualized net charge-offs for the first quarter of 2022 of 0.04
percent of average total loans, compared to net charge-offs of 0.51
percent for the first quarter of 2021. The decline in the net
charge-off ratio for the first quarter of 2022 compared to the
first quarter of 2021 reflects a lower number of charge-offs during
2022 and lower losses per loan charged off as a result of a strong
used car market. The consumer finance segment has experienced loan
performance since 2020 that has been generally stronger than
periods prior to the COVID-19 pandemic, resulting in part from the
consumer finance segment continuing to purchase higher quality
loans, and in part from government stimulus measures in response to
the pandemic that benefitted borrowers. At March 31,
2022, total delinquent loans as a percentage of total loans was
1.71 percent, compared to 2.16 percent at December 31, 2021 and
1.56 percent at March 31, 2021. The allowance for loan losses was
$25.1 million at March 31, 2022, compared to $24.8 million at
December 31, 2021. The allowance for loan losses as a percentage of
total loans decreased to 6.33 percent at March 31, 2022 from 6.73
percent at December 31, 2021, primarily as a result of improving
credit quality of the portfolio, which has resulted in lower net
charge-offs, and a reduction of certain qualitative adjustments to
reserves related to the COVID-19 pandemic. Management believes that
the level of the allowance for loan losses is sufficient to absorb
losses inherent in the portfolio. If loan performance deteriorates
resulting in elevated delinquencies or net charge-offs, provision
for loan losses may increase in future periods.
Capital and Dividends. The
Corporation declared a quarterly cash dividend of 40 cents per
share during the first quarter of 2022, which was paid on April 1,
2022. These dividends represent a payout ratio of 25.2 percent of
earnings per share for the first quarter of 2022. The Board of
Directors of the Corporation continually reviews the amount of cash
dividends per share and the resulting dividend payout ratio in
light of changes in economic conditions, current and future capital
requirements, and expected future earnings.
Total consolidated equity decreased $9.7 million
at March 31, 2022 compared to December 31, 2021, due primarily to
unrealized losses in the market value of securities available for
sale, which are recognized as a component of other comprehensive
income. The Corporation’s securities available for sale are fixed
income debt securities, and their decline in market value during
the first quarter of 2022 was a result of rising market interest
rates. The Corporation expects to recover its investments in debt
securities through scheduled payments of principal and interest,
and unrealized losses are not expected to affect the earnings or
regulatory capital of the Corporation or the Bank.
In November 2021, the Board of Directors
authorized a program, effective December 1, 2021, to repurchase up
to $10.0 million of the Corporation’s common stock through November
30, 2022. During the first quarter of 2022, the Corporation
repurchased 9,717 shares, or $493,000, of its common stock under
this share repurchase program.
About C&F Financial
Corporation. C&F Financial Corporation’s common stock
is listed for trading on The Nasdaq Stock Market under the symbol
CFFI. The common stock closed at a price of $52.39 per share on
April 20, 2022. At March 31, 2022, the book value of the
Corporation was $56.57 per share and the tangible book value per
share was $48.93. For more information about the Corporation’s
tangible book value per share, which is not calculated in
accordance with GAAP, please see “Use of Certain Non-GAAP Financial
Measures” and “Reconciliation of Certain Non-GAAP Financial
Measures,” below.
C&F Bank operates 31 banking offices and 4
commercial loan offices located throughout the Hampton to
Charlottesville corridor and the Northern Neck region in Virginia
and offers full wealth management services through its subsidiary
C&F Wealth Management, Inc. C&F Mortgage Corporation and
its subsidiary C&F Select LLC provide mortgage loan origination
services through offices located in Virginia, Maryland, North
Carolina, South Carolina and West Virginia. C&F Finance Company
provides automobile, marine and RV loans through indirect lending
programs offered in Alabama, Colorado, Florida, Georgia, Illinois,
Indiana, Iowa, Kansas, Kentucky, Maryland, Minnesota, Missouri, New
Jersey, North Carolina, Ohio, Pennsylvania, South Carolina,
Tennessee, Texas, Virginia and West Virginia through its offices in
Richmond and Hampton, Virginia.
Additional information regarding the
Corporation’s products and services, as well as access to its
filings with the Securities and Exchange Commission (SEC), are
available on the Corporation’s website at http://www.cffc.com.
Use of Certain Non-GAAP Financial
Measures. The accounting and reporting policies of the
Corporation conform to GAAP in the United States and prevailing
practices in the banking industry. However, certain non-GAAP
measures are used by management to supplement the evaluation of the
Corporation’s performance. These include adjusted net income,
adjusted earnings per share, adjusted ROE, adjusted return on
tangible common equity (ROTCE), adjusted ROA, tangible book value
per share, and the following fully-taxable equivalent (FTE)
measures: interest income on loans-FTE, interest income on
securities-FTE, total interest income-FTE and net interest
income-FTE.
Management believes that the use of these
non-GAAP measures provides meaningful information about operating
performance by enhancing comparability with other financial
periods, other financial institutions, and between different
sources of interest income. The non-GAAP measures used by
management enhance comparability by excluding the effects of (1)
items that do not reflect ongoing operating performance, (2)
balances of intangible assets, including goodwill, that vary
significantly between institutions, and (3) tax benefits that are
not consistent across different opportunities for investment. These
non-GAAP financial measures should not be considered an alternative
to GAAP-basis financial statements, and other bank holding
companies may define or calculate these or similar measures
differently. A reconciliation of the non-GAAP financial measures
used by the Corporation to evaluate and measure the Corporation’s
performance to the most directly comparable GAAP financial measures
is presented below.
Forward-Looking
Statements. This press release contains
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act, as amended. These forward-looking
statements are based on the beliefs of the Corporation’s
management, as well as assumptions made by, and information
currently available to, the Corporation’s management, and reflect
management’s current views with respect to certain events that
could have an impact on the Corporation’s future financial
performance. These statements, including without limitation
statements made in Mr. Cherry’s quotes, relate to expectations
concerning matters that are not historical fact, may express
“belief,” “intention,” “expectation,” “potential” and similar
expressions, and may use the words “believe,” “expect,”
“anticipate,” “estimate,” “plan,” “may,” “will,” “intend,”
“should,” “could,” or similar expressions. These statements are
inherently uncertain, and there can be no assurance that the
underlying assumptions will prove to be accurate. Actual results
could differ materially from those anticipated or implied by such
statements. Forward-looking statements in this release may include,
without limitation, statements regarding expected future operations
and financial performance, future dividend payments, strategic
business initiatives and the anticipated effects thereof, rising
interest rates and the effects thereof on net interest income,
future recognition of PPP origination fees, mortgage loan
originations, technology initiatives, our diversified business
strategy, asset quality, credit quality, adequacy of allowances for
loan losses and the level of future charge-offs, capital levels,
the effect of future market and industry trends, the effects of
future interest rate fluctuations, cybersecurity risks, and
inflation. Factors that could have a material adverse effect on the
operations and future prospects of the Corporation include, but are
not limited to, changes in: (1) interest rates, such as volatility
in short-term interest rates or yields on U.S. Treasury bonds and
increases or volatility in mortgage interest rates, (2) general
business conditions, as well as conditions within the financial
markets, (3) general economic conditions, including unemployment
levels, continuing supply chain disruption and slowdowns in
economic growth, and particularly related to further and sustained
economic impacts of the COVID-19 pandemic, the effectiveness of the
Corporation’s efforts to respond to the COVID-19 pandemic, the pace
of economic recovery when the pandemic subsides and the heightened
impact it has on many of the risks described herein and in other
periodic reports the Corporation files with the SEC, (4) the
legislative/regulatory climate, regulatory initiatives with respect
to financial institutions, products and services, the Consumer
Financial Protection Bureau (CFPB) and the regulatory and
enforcement activities of the CFPB, (5) monetary and fiscal
policies of the U.S. Government, including policies of the U.S.
Treasury and the Federal Reserve Board, and the effect of these
policies on interest rates and business in our markets, (6) the
value of securities held in the Corporation’s investment
portfolios, (7) the quality or composition of the loan portfolios
and the value of the collateral securing those loans, (8) the
inventory level and pricing of used automobiles, including sales
prices of repossessed vehicles, (9) the level of net charge-offs on
loans and the adequacy of our allowance for loan losses, (10) the
level of indemnification losses related to mortgage loans sold,
(11) demand for loan products, (12) deposit flows, (13) the
strength of the Corporation’s counterparties, (14) competition from
both banks and non-banks, including competition in the non-prime
automobile finance markets, (15) demand for financial services in
the Corporation’s market area, (16) reliance on third parties for
key services, (17) the commercial and residential real estate
markets, (18) demand in the secondary residential mortgage loan
markets, (19) the Corporation’s technology initiatives and other
strategic initiatives, (20) the Corporation’s branch expansions and
consolidations, (21) cyber threats, attacks or events, (22)
expansion of C&F Bank’s product offerings, and (23) accounting
principles, policies and guidelines, and elections by the
Corporation thereunder. These risks and uncertainties should be
considered in evaluating the forward-looking statements contained
herein, and readers are cautioned not to place undue reliance on
any forward-looking statements, which speak only as of the date of
this release. For additional information on risk factors that could
affect the forward-looking statements contained herein, see the
Corporation’s Annual Report on Form 10-K for the year ended
December 31, 2021 and other reports filed with the SEC.
Contact: |
Jason Long, CFO and Secretary |
|
(804)
843-2360 |
C&F Financial
Corporation
Selected Financial
Information(dollars in thousands, except for per
share data)(unaudited)
|
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|
|
Financial
Condition |
|
3/31/2022 |
|
12/31/2021 |
|
3/31/2021 |
|
Interest-bearing deposits in
other banks |
|
$ |
254,178 |
|
$ |
248,053 |
|
$ |
133,593 |
|
Investment securities -
available for sale, at fair value |
|
|
415,532 |
|
|
373,073 |
|
|
321,285 |
|
Loans held for sale, at fair
value |
|
|
46,659 |
|
|
82,295 |
|
|
177,350 |
|
Loans, net: |
|
|
|
|
|
|
|
|
|
|
Community Banking segment, excluding PPP loans |
|
|
1,014,050 |
|
|
999,912 |
|
|
939,148 |
|
PPP loans |
|
|
7,062 |
|
|
17,762 |
|
|
102,573 |
|
Mortgage Banking segment |
|
|
9,106 |
|
|
8,826 |
|
|
10,501 |
|
Consumer Finance segment |
|
|
371,623 |
|
|
343,403 |
|
|
293,781 |
|
Total assets |
|
|
2,301,843 |
|
|
2,264,521 |
|
|
2,168,638 |
|
Deposits |
|
|
1,969,661 |
|
|
1,914,614 |
|
|
1,831,982 |
|
Repurchase agreements |
|
|
32,434 |
|
|
34,735 |
|
|
23,926 |
|
Other borrowings |
|
|
55,669 |
|
|
55,726 |
|
|
55,809 |
|
Total equity |
|
|
201,278 |
|
|
211,024 |
|
|
198,692 |
|
|
|
|
|
|
|
|
|
|
|
|
For The |
|
|
|
Quarter Ended |
|
Results of
Operations |
|
3/31/2022 |
|
|
3/31/2021 |
|
Interest income |
|
$ |
22,231 |
|
|
|
$ |
23,076 |
|
Interest expense |
|
|
1,755 |
|
|
|
|
2,400 |
|
Provision for loan
losses: |
|
|
|
|
|
|
|
|
Community Banking segment |
|
|
(700 |
) |
|
|
|
- |
|
Mortgage Banking segment |
|
|
22 |
|
|
|
|
30 |
|
Consumer Finance segment |
|
|
350 |
|
|
|
|
250 |
|
Noninterest income: |
|
|
|
|
|
|
|
|
Gains on sales of loans |
|
|
2,695 |
|
|
|
|
7,058 |
|
Other |
|
|
4,034 |
|
|
|
|
7,017 |
|
Noninterest expenses: |
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
|
11,856 |
|
|
|
|
15,613 |
|
Other |
|
|
8,355 |
|
|
|
|
9,406 |
|
Income tax expense |
|
|
1,587 |
|
|
|
|
2,287 |
|
Net income |
|
|
5,735 |
|
|
|
|
7,165 |
|
|
|
|
|
|
|
|
|
|
Fully-taxable equivalent (FTE)
amounts1 |
|
|
|
|
|
|
|
|
Interest income on loans-FTE |
|
|
20,510 |
|
|
|
|
21,830 |
|
Interest income on securities-FTE |
|
|
1,733 |
|
|
|
|
1,341 |
|
Total interest income-FTE |
|
|
22,349 |
|
|
|
|
23,217 |
|
Net interest income-FTE |
|
|
20,594 |
|
|
|
|
20,817 |
|
________________________1For more information about these
non-GAAP financial measures, please see “Use of Certain Non-GAAP
Financial Measures” and “Reconciliation of Certain Non-GAAP
Financial Measures.”
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The |
|
|
|
Quarter Ended |
|
Average
Balances |
|
3/31/2022 |
|
|
12/31/2021 |
|
|
3/31/2021 |
|
Securities |
|
$ |
407,007 |
|
|
$ |
367,481 |
|
|
$ |
288,696 |
|
Loans held for sale |
|
|
50,196 |
|
|
|
98,279 |
|
|
|
165,769 |
|
Loans: |
|
|
|
|
|
|
|
|
|
|
|
|
Community Banking segment, excluding PPP loans |
|
|
1,012,904 |
|
|
|
1,007,382 |
|
|
|
952,802 |
|
PPP loans |
|
|
10,493 |
|
|
|
24,094 |
|
|
|
93,074 |
|
Mortgage Banking segment |
|
|
9,746 |
|
|
|
10,298 |
|
|
|
8,646 |
|
Consumer Finance segment |
|
|
381,115 |
|
|
|
358,994 |
|
|
|
314,223 |
|
Interest-bearing deposits in
other banks |
|
|
255,027 |
|
|
|
215,826 |
|
|
|
125,439 |
|
Total earning assets |
|
|
2,126,488 |
|
|
|
2,082,354 |
|
|
|
1,948,649 |
|
Total assets |
|
|
2,262,828 |
|
|
|
2,229,345 |
|
|
|
2,101,231 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Time, checking and savings
deposits |
|
|
1,336,995 |
|
|
|
1,299,189 |
|
|
|
1,262,933 |
|
Repurchase agreements |
|
|
32,724 |
|
|
|
36,065 |
|
|
|
21,188 |
|
Other borrowings |
|
|
55,707 |
|
|
|
55,764 |
|
|
|
55,752 |
|
Total interest-bearing
liabilities |
|
|
1,425,426 |
|
|
|
1,391,018 |
|
|
|
1,339,873 |
|
Noninterest-bearing demand
deposits |
|
|
585,922 |
|
|
|
585,534 |
|
|
|
515,782 |
|
Total equity |
|
|
208,755 |
|
|
|
203,283 |
|
|
|
189,105 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized Average
Yields and Rates |
|
|
|
|
|
|
|
|
|
|
|
|
Loans: |
|
|
|
|
|
|
|
|
|
|
|
|
Community Banking segment |
|
|
4.14 |
% |
|
|
4.30 |
% |
|
|
4.44 |
% |
Mortgage Banking segment |
|
|
3.30 |
|
|
|
3.04 |
|
|
|
2.62 |
|
Consumer Finance segment |
|
|
10.19 |
|
|
|
10.77 |
|
|
|
11.94 |
|
Time, checking and savings
deposits |
|
|
0.34 |
|
|
|
0.35 |
|
|
|
0.54 |
|
Net interest margin |
|
|
3.93 |
|
|
|
4.09 |
|
|
|
4.33 |
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Quality |
|
3/31/2022 |
|
12/31/2021 |
|
3/31/2021 |
|
Community
Banking |
|
|
|
|
|
|
|
|
|
|
Loans, excluding purchased loans and PPP loans |
|
$ |
973,510 |
|
$ |
954,262 |
|
|
$ |
870,811 |
|
Purchased performing loans1 |
|
|
51,938 |
|
|
56,798 |
|
|
|
77,491 |
|
Purchased credit impaired loans1 |
|
|
2,686 |
|
|
3,655 |
|
|
|
5,878 |
|
PPP loans2 |
|
|
7,062 |
|
|
17,762 |
|
|
|
102,573 |
|
Total loans |
|
$ |
1,035,196 |
|
$ |
1,032,477 |
|
|
$ |
1,056,753 |
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual loans |
|
$ |
118 |
|
$ |
2,359 |
|
|
$ |
2,956 |
|
Other real estate owned (OREO)3 |
|
$ |
- |
|
$ |
835 |
|
|
$ |
907 |
|
Impaired loans4 |
|
$ |
2,427 |
|
$ |
5,058 |
|
|
$ |
5,658 |
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses (ALL) |
|
$ |
14,084 |
|
$ |
14,803 |
|
|
$ |
15,032 |
|
Nonaccrual loans to total loans |
|
|
0.01 |
% |
|
0.23 |
% |
|
|
0.28 |
% |
ALL to total loans |
|
|
1.36 |
% |
|
1.43 |
% |
|
|
1.42 |
% |
ALL to nonaccrual loans |
|
|
11,935.59 |
% |
|
627.51 |
% |
|
|
508.53 |
% |
ALL to total loans, excluding purchased credit impaired loans5 |
|
|
1.36 |
% |
|
1.44 |
% |
|
|
1.43 |
% |
ALL to total loans, excluding purchased loans and PPP loans |
|
|
1.45 |
% |
|
1.55 |
% |
|
|
1.73 |
% |
Annualized year-to-date net charge-offs to average loans |
|
|
0.01 |
% |
|
0.01 |
% |
|
|
0.01 |
% |
|
|
|
|
|
|
|
|
|
|
|
Mortgage
Banking |
|
|
|
|
|
|
|
|
|
|
Total loans |
|
$ |
9,691 |
|
$ |
9,389 |
|
|
$ |
11,139 |
|
Nonaccrual loans |
|
$ |
329 |
|
$ |
185 |
|
|
$ |
30 |
|
Impaired loans |
|
$ |
157 |
|
$ |
150 |
|
|
$ |
- |
|
ALL |
|
$ |
585 |
|
$ |
563 |
|
|
$ |
638 |
|
Nonaccrual loans to total loans |
|
|
3.39 |
% |
|
1.97 |
% |
|
|
0.27 |
% |
ALL to total loans |
|
|
6.04 |
% |
|
6.00 |
% |
|
|
5.73 |
% |
ALL to nonaccrual loans |
|
|
177.81 |
% |
|
304.32 |
% |
|
|
2,126.67 |
% |
Annualized year-to-date net charge-offs to average loans |
|
|
- |
% |
|
- |
% |
|
|
- |
% |
|
|
|
|
|
|
|
|
|
|
|
Consumer
Finance |
|
|
|
|
|
|
|
|
|
|
Total loans |
|
$ |
396,722 |
|
$ |
368,194 |
|
|
$ |
317,144 |
|
Nonaccrual loans |
|
$ |
318 |
|
$ |
380 |
|
|
$ |
182 |
|
Repossessed assets |
|
$ |
165 |
|
$ |
190 |
|
|
$ |
156 |
|
ALL |
|
$ |
25,099 |
|
$ |
24,791 |
|
|
$ |
23,363 |
|
Nonaccrual loans to total loans |
|
|
0.08 |
% |
|
0.10 |
% |
|
|
0.06 |
% |
ALL to total loans |
|
|
6.33 |
% |
|
6.73 |
% |
|
|
7.37 |
% |
ALL to nonaccrual loans |
|
|
7892.77 |
% |
|
6,523.95 |
% |
|
|
12,836.81 |
% |
Annualized year-to-date net charge-offs (recoveries) to average
loans |
|
|
0.04 |
% |
|
(0.14 |
)% |
|
|
0.51 |
% |
________________________
- Acquired loans are tracked in two separate categories:
“purchased performing” and “purchased credit impaired.” The
remaining discount for purchased performing loans was $1.0 million
at 3/31/22, $1.1 million at 12/31/21 and $1.5 million at 3/31/21.
The remaining discount for purchased credit impaired loans was $4.4
million at 3/31/22, $4.7 million at 12/31/21 and $5.6 million at
3/31/21.
- The principal amount of outstanding PPP loans was $7.3 million
at 3/31/22, $18.4 million at 12/31/21 and $106.3 million at
3/31/21.
- Includes $835,000 at 12/31/21 related to the land and buildings
of a former bank branch, which was consolidated into a nearby
branch in 2019 and was sold in the first quarter of 2022.
- Impaired loans includes $2.2 million of loans on nonaccrual at
December 31, 2021. Impaired loans also includes $2.2 million and
$2.7 million of TDRs at March 31, 2022 and December 31, 2021,
respectively.
- The ratio of ALL to total loans, excluding purchased credit
impaired loans, includes purchased performing loans and loans
originated under the PPP for which no allowance for loan losses is
required.
|
|
|
|
|
|
|
|
|
For The |
|
|
Quarter Ended |
Other Performance
Data |
|
3/31/2022 |
|
3/31/2021 |
Net Income (Loss): |
|
|
|
|
|
|
Community Banking |
|
$ |
3,517 |
|
|
$ |
2,793 |
|
Mortgage Banking |
|
|
866 |
|
|
|
2,545 |
|
Consumer Finance |
|
|
2,062 |
|
|
|
2,527 |
|
Other |
|
|
(710 |
) |
|
|
(700 |
) |
Total |
|
$ |
5,735 |
|
|
$ |
7,165 |
|
|
|
|
|
|
|
|
Net income attributable to
C&F Financial Corporation |
|
$ |
5,629 |
|
|
$ |
7,061 |
|
|
|
|
|
|
|
|
Earnings per share - basic and
diluted |
|
$ |
1.59 |
|
|
$ |
1.92 |
|
Weighted average shares
outstanding - basic and diluted |
|
|
3,547,780 |
|
|
|
3,676,067 |
|
|
|
|
|
|
|
|
Annualized return on average
assets |
|
|
1.01 |
% |
|
|
1.36 |
% |
Adjusted annualized return on
average assets1 |
|
|
1.00 |
% |
|
|
1.36 |
% |
Annualized return on average
equity |
|
|
10.99 |
% |
|
|
15.16 |
% |
Adjusted annualized return on
average equity1 |
|
|
10.87 |
% |
|
|
15.16 |
% |
Adjusted annualized return on
average tangible common equity1 |
|
|
12.47 |
% |
|
|
17.74 |
% |
Dividends declared per
share |
|
$ |
0.40 |
% |
|
$ |
0.38 |
% |
|
|
|
|
|
|
|
Mortgage loan originations -
Mortgage Banking |
|
$ |
189,904 |
|
|
$ |
422,503 |
|
Mortgage loans sold - Mortgage
Banking |
|
|
220,315 |
|
|
|
458,183 |
|
________________________1 For more information about these
non-GAAP financial measures, please see “Use of Certain Non-GAAP
Financial Measures” and “Reconciliation of Certain Non-GAAP
Financial Measures.”
|
|
|
|
|
|
|
|
Market
Ratios |
|
3/31/2022 |
|
|
12/31/2021 |
Market value per share |
|
$ |
50.53 |
|
|
$ |
51.19 |
Book value per share |
|
$ |
56.57 |
|
|
$ |
59.32 |
Price to book value ratio |
|
|
0.89 |
|
|
|
0.86 |
Tangible book value per
share1 |
|
$ |
48.93 |
|
|
$ |
51.66 |
Price to tangible book value
ratio1 |
|
|
1.03 |
|
|
|
0.99 |
Price to earnings ratio
(ttm) |
|
|
6.64 |
|
|
|
6.44 |
________________________1 For more information about these
non-GAAP financial measures, please see “Use of Certain Non-GAAP
Financial Measures” and “Reconciliation of Certain Non-GAAP
Financial Measures.”
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Minimum Capital |
Capital
Ratios |
|
3/31/2022 |
|
|
12/31/2021 |
|
|
Requirements3 |
C&F Financial
Corporation1 |
|
|
|
|
|
|
|
|
|
|
Total risk-based capital ratio |
|
|
15.8 |
% |
|
15.8 |
% |
|
8.0 |
% |
Tier 1 risk-based capital ratio |
|
|
13.1 |
% |
|
13.0 |
% |
|
6.0 |
% |
Common equity tier 1 capital ratio |
|
|
11.5 |
% |
|
11.5 |
% |
|
4.5 |
% |
Tier 1 leverage ratio |
|
|
9.7 |
% |
|
9.7 |
% |
|
4.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
C&F
Bank2 |
|
|
|
|
|
|
|
|
|
|
Total risk-based capital ratio |
|
|
14.5 |
% |
|
14.5 |
% |
|
8.0 |
% |
Tier 1 risk-based capital ratio |
|
|
13.2 |
% |
|
13.3 |
% |
|
6.0 |
% |
Common equity tier 1 capital ratio |
|
|
13.2 |
% |
|
13.3 |
% |
|
4.5 |
% |
Tier 1 leverage ratio |
|
|
9.8 |
% |
|
9.8 |
% |
|
4.0 |
% |
________________________1 The Corporation, a small bank
holding company under applicable regulations and guidance, is not
subject to the minimum regulatory capital regulations for bank
holding companies. The regulatory requirements that apply to bank
holding companies that are subject to regulatory capital
requirements are presented above, along with the Corporation’s
capital ratios as determined under those regulations.2 All
ratios at March 31, 2022 are estimates and subject to change
pending regulatory filings. All ratios at December 31, 2021 are
presented as filed.3 The ratios presented for minimum capital
requirements are those to be considered adequately capitalized.
|
|
|
|
|
|
|
|
|
For The Quarter Ended |
|
|
3/31/2022 |
|
3/31/2021 |
Reconciliation of
Certain Non-GAAP Financial Measures |
|
|
|
|
Adjusted Net Income
and Earnings Per Share |
|
|
Net income, as reported |
|
$ |
5,735 |
|
|
$ |
7,165 |
|
Branch consolidation1 |
|
|
(63 |
) |
|
|
- |
|
Adjusted net income |
|
$ |
5,672 |
|
|
$ |
7,165 |
|
|
|
|
|
|
|
|
Weighted average shares -
basic and diluted |
|
|
3,547,780 |
|
|
|
3,676,067 |
|
|
|
|
|
|
|
|
Earnings per share - basic and
diluted, as reported |
|
$ |
1.59 |
|
|
$ |
1.92 |
|
Branch consolidation |
|
|
(0.02 |
) |
|
|
- |
|
Adjusted earnings per share -
basic and diluted |
|
$ |
1.57 |
|
|
$ |
1.92 |
|
|
|
|
|
|
|
|
Adjusted Return on
Average Equity (ROE) |
|
|
|
|
|
|
Average total equity, as
reported |
|
$ |
208,755 |
|
|
$ |
189,105 |
|
|
|
|
|
|
|
|
Annualized ROE, as reported |
|
|
10.99 |
% |
|
|
15.16 |
% |
Adjusted annualized ROE |
|
|
10.87 |
% |
|
|
15.16 |
% |
|
|
|
|
|
|
|
Adjusted Return on
Average Assets (ROA) |
|
|
|
|
|
|
Average total assets, as
reported |
|
$ |
2,262,828 |
|
|
$ |
2,101,231 |
|
|
|
|
|
|
|
|
Annualized ROA, as reported |
|
|
1.01 |
% |
|
|
1.36 |
% |
Adjusted annualized ROA |
|
|
1.00 |
% |
|
|
1.36 |
% |
|
|
|
|
|
|
|
Adjusted Return on
Average Tangible Common Equity |
|
|
|
|
|
|
Average total equity, as
reported |
|
$ |
208,755 |
|
|
$ |
189,105 |
|
Average goodwill |
|
|
(25,191 |
) |
|
|
(25,191 |
) |
Average intangibles |
|
|
(1,937 |
) |
|
|
(2,242 |
) |
Average noncontrolling
interest |
|
|
(733 |
) |
|
|
(717 |
) |
Average tangible common
equity |
|
$ |
180,894 |
|
|
$ |
160,955 |
|
|
|
|
|
|
|
|
Adjusted net income |
|
$ |
5,672 |
|
|
$ |
7,165 |
|
Amortization of
intangibles |
|
|
75 |
|
|
|
78 |
|
Adjusted net income
attributable to noncontrolling interest |
|
|
(106 |
) |
|
|
(104 |
) |
Adjusted net income
attributable to C&F Financial Corporation |
|
$ |
5,641 |
|
|
$ |
7,139 |
|
|
|
|
|
|
|
|
Adjusted annualized return on average tangible common equity |
|
|
12.47 |
% |
|
|
17.74 |
% |
|
|
|
|
|
|
|
Adjusted Net Income,
Community Banking Segment |
|
|
|
|
|
|
Net income, community banking
segment, as reported |
|
$ |
3,517 |
|
|
$ |
2,793 |
|
Branch consolidation1 |
|
|
(63 |
) |
|
|
- |
|
Adjusted net income, community
banking segment |
|
$ |
3,454 |
|
|
$ |
2,793 |
|
|
|
|
|
|
|
|
Fully Taxable
Equivalent Net Interest Income2 |
|
|
|
|
|
|
Interest income on loans |
|
$ |
20,484 |
|
|
$ |
21,813 |
|
FTE adjustment |
|
|
26 |
|
|
|
17 |
|
FTE interest income on loans |
|
$ |
20,510 |
|
|
$ |
21,830 |
|
|
|
|
|
|
|
|
Interest income on securities |
|
$ |
1,641 |
|
|
$ |
1,217 |
|
FTE adjustment |
|
|
92 |
|
|
|
124 |
|
FTE interest income on securities |
|
$ |
1,733 |
|
|
$ |
1,341 |
|
|
|
|
|
|
|
|
Total interest income |
|
$ |
22,231 |
|
|
$ |
23,076 |
|
FTE adjustment |
|
|
118 |
|
|
|
141 |
|
FTE interest income |
|
$ |
22,349 |
|
|
$ |
23,217 |
|
|
|
|
|
|
|
|
Net interest income |
|
$ |
20,476 |
|
|
$ |
20,676 |
|
FTE adjustment |
|
|
118 |
|
|
|
141 |
|
FTE net interest income |
|
$ |
20,594 |
|
|
$ |
20,817 |
|
________________________
- Branch consolidation activity is net of related income taxes of
$17,000 for the quarter ended March 31, 2022.
- Assuming a tax rate of 21%.
|
|
|
|
|
|
|
|
|
|
3/31/2022 |
|
|
12/31/2021 |
Tangible Book Value
Per Share |
|
|
|
|
|
Equity attributable to C&F
Financial Corporation |
|
$ |
200,584 |
|
|
$ |
210,318 |
Less goodwill |
|
|
25,191 |
|
|
|
25,191 |
Less other intangible
assets |
|
|
1,902 |
|
|
|
1,977 |
Tangible equity attributable
to C&F Financial Corporation |
|
$ |
173,491 |
|
|
$ |
183,150 |
|
|
|
|
|
|
|
|
Shares outstanding |
|
|
3,546,024 |
|
|
|
3,545,554 |
|
|
|
|
|
|
|
|
Book value per share |
|
$ |
56.57 |
|
|
$ |
59.32 |
Tangible book value per share |
|
$ |
48.93 |
|
|
$ |
51.66 |
C and F Financial (NASDAQ:CFFI)
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C and F Financial (NASDAQ:CFFI)
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De Jun 2023 até Jun 2024