Bogota Financial Corp. (NASDAQ: BSBK) (the “Company”), the
holding company for Bogota Savings Bank (the “Bank”), reported net
income for the three months ended September 30, 2021 of $1.0
million, compared to net income of $956,000 for the comparable
prior year period. The Company reported net income for the nine
months ended September 30, 2021 of $5.5 million compared the net
income of $1.0 million for the comparable prior year period. During
the nine months ended September 30, 2021, the Company recorded a
bargain purchase gain of $1.9 million and merger-related expenses
of $392,000, both associated with the acquisition of Gibraltar
Bank. The Company contributed cash and stock with a value of $2.9
million ($2.1 million after-tax) to the Bogota Charitable
Foundation during the nine months ended September 30, 2020.
Excluding the bargain purchase gain and the merger-related expenses
in 2021 and the contribution to the charitable foundation in 2020,
net income for the nine months ended September 30, 2021 and 2020
was $3.9 million and $3.1 million, respectively. 1
On January 15, 2020, the Company became the holding company for
the Bank when it completed the reorganization of the Bank into a
two-tier mutual holding company form of organization. In connection
with the reorganization, the Company sold 5,657,735 shares of
common stock at a price of $10 per share, for gross proceeds of
$56.6 million. The Company also issued 263,150 shares of common
stock and $250,000 in cash to Bogota Savings Bank Charitable
Foundation, Inc., and issued 7,236,640 shares of common stock to
Bogota Financial, MHC, its New Jersey-chartered mutual holding
company.
On February 28, 2021, the Company completed its acquisition of
Gibraltar Bank and, as part of the transaction, the Company issued
1,267,916 shares of its common stock to Bogota Financial, MHC. The
conversion and consolidation of data processing platforms, systems
and customer files was completed in August 2021. The merger added
three branches to the Bank’s network. In the third quarter of 2021,
the Bank opened a new branch in Hasbrouck Heights, New Jersey,
which will also include additional offices for staff.
Other Financial Highlights:
- Total assets increased $94.1 million, or 12.7%, to $835.0
million from $740.9 million at December 31, 2020, primarily due to
the assets acquired from the Gibraltar Bank acquisition.
- Net loans increased $22.2 million, or 4.0%, to $579.9 million
at September 30, 2021 from $557.7 million at December 31,
2020.
- Total deposits were $591.2 million, increasing $89.2 million,
or 17.8%, as compared to $502.0 million at December 31, 2020,
primarily due to acquiring $81.4 million in deposits from Gibraltar
Bank acquisition.
- Return on average assets was 0.91% for the nine-month period
ended September 30, 2021 compared to 0.19% for the corresponding
period of 2020. Without the bargain purchase gain and
merger-related expenses in 2021 and the charitable foundation
contribution in 2020, the return on average assets would have been
0.65%1 and 0.55%1 for the nine-month periods ended September 30,
2021 and 2020, respectively.
- Return on average equity was 5.20% for the nine-month period
ended September 30, 2021 compared to 1.11% for the corresponding
period of 2020. Without the bargain purchase gain and
merger-related expenses in 2021 and the charitable foundation
contribution in 2020, the return on average equity would have been
3.74%2 and 3.25%2 for the nine months ended September 30, 2021 and
2020, respectively.
Joseph Coccaro, President and Chief Executive Officer, said,
“During the third quarter, we completed the integration of
Gibraltar Bank, including a successful system conversion in August.
In the third quarter, we opened our Hasbrouck Heights branch which
is our sixth branch location and contains additional office space
for the Bank. The Bank held its grand opening of the new branch on
August 4th and has seen over $10.0 million in deposits as of the
end of the quarter."
“We are pleased with our continued strategy to expand our loan
portfolio and the positive overall impacts of doing so on assets
and income. We continue our efforts to expand our market presence,
improve and expand our technology platform and offerings and manage
our interest rate risk.”
Mr. Coccaro further stated, “We are pleased with our results for
the first nine months and we continue to enjoy strong credit
quality as non-performing loans and criticized assets remain very
low. We continue to see strong growth in rates resulting in our net
interest margin rising 56 basis points on a year over year
quarterly comparison. We have finished a second round of SBA PPP
loans and look forward to continuing to serve our communities going
forward. The economic impact of the COVID-19 pandemic on the
Company’s operations was not material during 2021. Our loan
deferrals are down to one residential loan as of September 30,
2021.”
Paycheck Protection Program
As a qualified Small Business Administration lender, the Company
was automatically authorized to originate loans under the Paycheck
Protection Program (“PPP”). During 2020, the Company received and
processed 113 PPP applications totaling $10.5 million. The Company
participated in the second round of PPP loans and during 2021, the
Company received and processed 54 PPP applications totaling $6.9
million.
COVID
The Company has provided assistance to individuals and small
business clients directly impacted by the COVID-19 pandemic by
allowing borrowers to modify their loans to defer principal and/or
interest payments. Through December 31, 2020, the Company granted
172 loan modifications totaling $67.9 million. As of September 30,
2021 one residential loan totaling $117,000 is still on
deferral.
Income Statement Analysis
Comparison of Operating Results for the Three Months Ended
September 30, 2021 and September 30, 2020
Net income increased by $86,000, or 9.0%, to $1.0 million for
the three months ended September 30, 2021 from net income of $1.0
million for the three months ended September 30, 2020. The increase
was due to increases in net interest income of $1.5 million and
non-interest income of $266,000 offset by increases in non-interest
expense of $1.4 million and income tax expense of $280,000.
Interest income on cash and cash equivalents decreased $15,000,
or 31.6%, to $33,000 for the three months ended September 30, 2021
from $48,000 for the three months ended September 30, 2020 due to a
16 basis point decrease in the average yield on cash and cash
equivalents from 0.29% for the three months ended September 30,
2020 to 0.13% for the three months ended September 30, 2021 due to
the lower interest rate environment. The decrease was offset by a
$34.6 million increase in the average balance of cash and cash
equivalents to $101.5 million for the three months ended September
30, 2021 from $66.9 million for the three months ended September
30, 2020, reflecting excess liquidity as deposit growth exceeded
loan growth.
Interest income on loans increased $576,000, or 10.7%, to $6.0
million for the three months ended September 30, 2021 from $5.4
million for the three months ended September 30, 2020 due to a 39
basis point increase in the average yield on loans from 3.66% for
the three months ended September 30, 2020 to 4.05% for the three
months ended September 30, 2021 offset by a $1.7 million decrease
in the average balance of loans to $584.8 million for the three
months ended September 30, 2021 from $586.5 million for the three
months ended September 30, 2020. The decrease in the average
balance of loans reflected a higher repayment rate of residential
loans.
Interest income on securities increased $43,000, or 11.4%, to
$424,000 for the three months ended September 30, 2021 from
$381,000 for the three months ended September 30, 2020 due to a
$24.2 million increase in the average balance of securities to
$88.6 million for the three months ended September 30, 2021 from
$64.4 million for the three months ended September 30, 2020,
reflecting investments with excess liquidity as deposit growth
exceeded loan growth, offset by a 46 basis point decrease in the
average yield from 2.37% for the three months ended September 30,
2020 to 1.91% for the three months ended September 30, 2021.
Interest expense on interest-bearing deposits decreased
$796,000, or 43.3%, to $1.0 million for the three months ended
September 30, 2021 from $1.8 million for the three months ended
September 30, 2020. The decrease was due primarily to a 75 basis
point decrease in the average cost of interest-bearing deposits to
0.75% for the three months ended September 30, 2021 from 1.50% for
the three months ended September 30, 2020. The decrease in the
average cost of deposits was due to the lower interest rate
environment and an increase in the average balance of lower-cost
transaction accounts and a decrease in the average balance of
higher cost certificates of deposit. This decrease was offset by a
$62.0 million increase in the average balance of deposits to $548.0
million for the three months ended September 30, 2021 from $486.0
million for the three months ended September 30, 2020.
Interest expense on Federal Home Loan Bank borrowings decreased
$103,000, or 21.8%, from $472,000 for the three months ended
September 30, 2020 to $369,000 for the three months ended September
30, 2021. The decrease was due to a decrease in the average cost of
borrowings of 21 basis points to 1.52% for the three months ended
September 30, 2021 from 1.73% for the three months ended September
30, 2020 due to the lower interest rate environment and a decrease
in the average balance of borrowings of $15.0 million to $96.0
million for the three months ended September 30, 2021 from $108.6
million for the three months ended September 30, 2021.
We recorded a provision for loan losses of $25,000 for the three
months ended September 30, 2021 and for the three-month period
ended September 30, 2020. Lower balances in residential loans, a
more positive economic environment and continued strong asset
quality metrics were the reasons for the low provision during the
three months ended September 30, 2021. The Bank continues to have a
low level of delinquent and non-accrual loans in the portfolio, as
well as no charge-offs. Non-performing assets were $1.9 million, or
0.33% of total assets, at September 30, 2021. The allowance for
loan losses was $2.2 million, or 0.37% of loans outstanding and
114.2% of nonperforming loans, at September 30, 2021.
Non-interest income increased by $266,000, or 246.5%, to
$374,000 for the three months ended September 30, 2021 from
$108,000 for the three months ended September 30, 2020. The
increase was due to $67,000 higher income on bank owned life
insurance due to the purchase of $8.0 million of bank-owned life
insurance and a $127,000 gain on sale of $4.3 million residential
loans during the three months ended September 30, 2021.
For the three months ended September 30, 2021, non-interest
expense increased $1.4 million to $3.8 million, over the comparable
2020 period. Salaries and employee benefits increased $698,000, or
52.5%, attributable to adding the new Gibraltar employees. Data
processing expense increased $75,000, or 41.0%, due to higher data
processing expense from maintaining two core systems until the date
processing conversion was completed in August 2021. Professional
fees decreased $110,000, or 46.3%, due in part to lower legal and
merger expenses. The increase of other general operating expenses
was mainly due to increase occupancy costs for the acquired
Gibraltar Bank branches and the branch location in Hasbrouck
Heights which opened in August.
Comparison of Operating Results for the Nine Months Ended
September 30, 2021 and September 30, 2020
Net income increased by $4.5 million to $5.5 million for the
nine months ended September 30, 2021 from net income of $1.0
million for the nine months ended September 30, 2020. The increase
was due to increases in net interest income of $4.5 million, a
decrease in the provision for loan losses of $363,000 and an
increase in non-interest income of $2.2 million, offset by
increases in non-interest expense of $1.2 million and income tax
expense of $1.4 million.
Interest income on cash and cash equivalents decreased $280,000,
or 70.2%, to $119,000 for the nine months ended September 30, 2021
from $399,000 for the nine months ended September 30, 2020 due to a
65 basis point decrease in the average yield on cash and cash
equivalents from 0.81% for the nine months ended September 30, 2020
to 0.16% for the nine months ended September 30, 2021 due to the
lower interest rate environment. The decrease was offset by a $31.7
million increase in the average balance of cash and cash
equivalents to $97.6 million for the nine months ended September
30, 2021 from $65.9 million for the nine months ended September 30,
2020, reflecting excess liquidity as deposit growth exceeded loan
growth.
Interest income on loans increased $1.4 million, or 8.8%, to
$17.1 million for the nine months ended September 30, 2021 from
$15.7 million for the nine months ended September 30, 2020 due to a
$22.8 million increase in the average balance of loans to $585.2
million for the nine months ended September 30, 2021 from $562.4
million for the nine months ended September 30, 2020. The increase
in the average balance of loans reflected our continued efforts to
increase our loan originations and the loans acquired from
Gibraltar Bank. The increase was supplemented by a 18 basis point
increase in the average yield on loans from 3.73% for the nine
months ended September 30, 2020 to 3.91% for the nine months ended
September 30, 2021 due to a higher rate environment when comparing
the two periods.
Interest income on securities increased $270,000, or 22.3%, to
$1.5 million for the nine months ended September 30, 2021 from $1.2
million for the nine months ended September 30, 2020 due to a $16.0
million increase in the average balance of securities to $81.9
million for the nine months ended September 30, 2021 from $65.9
million for the nine months ended September 30, 2020 offset by a 5
basis point decrease in the average yield from 2.51% for the nine
months ended September 30, 2020 to 2.46% for the nine months ended
September 30, 2021, reflecting investments with excess liquidity as
deposit growth exceeded loan growth.
Interest expense on interest-bearing deposits decreased $2.8
million, or 45.8%, to $3.4 million for the nine months ended
September 30, 2021 from $6.2 million for the nine months ended
September 30, 2020. The decrease was due primarily to 91 basis
point decrease in the average cost of interest-bearing deposits to
0.85% for the nine months ended September 30, 2021 from 1.76% for
the nine months ended September 30, 2020. The decrease in the
average cost of deposits was due to the lower interest rate
environment and an increase in the average balance of lower-cost
transaction accounts and a decrease in the average balance of
higher cost certificates of deposit. This decrease was offset by a
$60.7 million increase in the average balance of deposits to $530.3
million for the nine months ended September 30, 2021 from $469.7
million for the nine months ended September 30, 2020.
Interest expense on Federal Home Loan Bank borrowings decreased
$302,000, or 20.4%, from $1.2 million for the nine months ended
September 30, 2020 to $1.5 million for the nine months ended
September 30, 2021. The decrease was primarily due to the lower
interest rate environment, as the average cost of borrowings
decreased 34 basis point to 1.55% for the nine months ended
September 30, 2021 from 1.89% for the nine months ended September
30, 2020.
Net interest income increased $4.5 million, or 44.8%, to $14.4
million for the nine months ended September 30, 2021 from $10.0
million for the nine months ended September 30, 2020. The increase
reflected a 75 basis point increase in our net interest rate spread
to 2.33% for the nine months ended September 30, 2021 from 1.58%
for the nine months ended September 30, 2020. Our net interest
margin increased 60 basis points to 2.50% for the nine months ended
September 30, 2021 from 1.90% for the nine months ended September
30, 2020.
We recorded a credit for loan losses of $88,000 for the nine
months ended September 30, 2021 compared to a provision for loan
losses of $275,000 for the nine months ended September 30, 2020.
Lower balances in residential loans, a more positive economic
environment and continued strong asset quality metrics were the
reasons for the credit during the nine months ended September 30,
2021. The Bank continues to have a low level of delinquent and
non-accrual loans in the portfolio, as well as no charge-offs.
Non-interest income increased by $2.2 million or 223.6%, to $3.2
million for the nine months ended September 30, 2021 from $997,000
for the nine months ended September 30, 2020. The increase was due
to $1.9 million bargain purchase gain for the Gibraltar merger, a
$647,000 gain on sale of $20.0 million residential loans sold
during the nine months ended September 30, 2021, offset by $547,000
lower income on bank owned life insurance as last year the Bank
collected death proceeds.
For the nine months ended September 30, 2021, non-interest
expense increased $1.2 million to $10.8 million, over the
comparable 2020 period. Salaries and employee benefits increased
$1.8 million, or 47.8%, attributable to adding the new Gibraltar
employees, additional branch offices and normal merit increases.
Data processing expense increased $284,000, or 57.6%, due to higher
data processing expense from maintaining two core systems until the
data processing conversion was completed in August. Professional
fees decreased $47,000, or 7.2%, due to lower legal and consulting
fees. Merger expenses were $392,000 in 2021 associated with the
Gibraltar Bank acquisition. The increase of other general operating
expenses was mainly due to increase occupancy costs for the
acquired Gibraltar Bank branches and the branch location in
Hasbrouck Heights, which opened in August. During the nine months
ended September 30, 2020 the Bank made a $2.9 million contribution
to the Bogota Charitable Foundation and there was no contribution
for the nine months ended September 30, 2021.
Balance Sheet Analysis
Total assets were $835.0 million at September 30, 2021,
representing an increase of $94.1 million, or 12.7%, from December
31, 2020. Cash and cash equivalents from banks increased $35.9
million during the period primarily due to $19.6 million in
repayments in residential loans and $19.3 million in cash from the
Gibraltar Bank acquisition. Net loans increased $22.2 million, or
4.0%, due to new production of $72.2 million, consisting of a
relatively equal mix of residential real estate loans and
commercial real estate loans and $77.0 million of loans acquired
from Gibraltar Bank, which was offset by $127.0 million in
repayments. Securities held to maturity increased $17.5 million due
to the purchase of corporate bonds and mortgage-backed securities
with excess cash . Securities held to maturity increased $6.2
million due to the purchase of mortgage backed securities and
corporate bonds with excess cash. Bank-owned life insurance
increased $8.4 million due to a new purchase of $8.0 million of
Bank-owned life insurance.
Delinquent loans increased $1.7 million, or 194.6%, during the
nine-month period ended September 30, 2021, finishing at $2.6
million or 0.5% of total loans. During the same timeframe,
non-performing assets increased $1.2 million, or 174.5%, to $1.9
million due to the addition of six loans acquired in the Gibraltar
Bank acquisition and were 0.2% of total assets at September 30,
2021. The Company’s allowance for loan losses was 0.37% of total
loans and 114.20% of non-performing loans at September 30,
2021.
Total liabilities increased $76.7 million, or 12.5%, to $689.1
million mainly due to deposits acquired from Gibraltar Bank, offset
by a decrease in borrowings. Total deposits increased $89.2
million, or 17.8%, to $591.2 million at September 30, 2021 from
$502.0 million at December 31, 2020. The increase in deposits
reflected an increase in interest-bearing deposits of $80.1
million, or 16.9%, to $555.0 million as of September 30, 2021 from
$474.9 million at December 31, 2020 and an increase in non-interest
bearing deposits of $9.1 million, or 33.8%, to $36.2 million as of
September 30, 2021 from $27.1 million as of December 31, 2020. The
increases are primarily due to the $81.4 million of deposits
acquired from Gibraltar Bank. Federal Home Loan Bank advances
decreased $14.2 million, or 13.6%, as the $10.0 million of
borrowings acquired from Gibraltar Bank were offset by $24.2
million of borrowings that matured.
Stockholders’ equity increased $17.1 million to $145.6 million,
as a result of $11.5 million of capital acquired from Gibraltar
Bank and net income of $5.5 million for the first nine months of
2021. At September 30, 2021, the Company’s ratio of average
stockholders’ equity-to-total assets was 17.39%, compared to 16.85%
at September 30, 2020.
EXPLANATORY NOTE
The Company was formed to serve as the mid-tier stock holding
company for the Bank in connection with the reorganization of the
Bank and its mutual holding company, Bogota Financial, MHC, into
the two-tier mutual holding company structure.
About Bogota Financial Corp.
Bogota Financial Corp. is a Maryland corporation organized as
the mid-tier holding company of Bogota Savings Bank and is the
majority-owned subsidiary of Bogota Financial, MHC. Bogota Savings
Bank is a New Jersey chartered stock savings bank that has served
the banking needs of its customers in northern and central New
Jersey since 1893. It operates from six offices located in Bogota,
Hasbrouck Heights, Newark, Oak Ridge, Parsippany and Teaneck, New
Jersey and operates a loan production office in Spring Lake, New
Jersey.
Forward-Looking Statements
This press release contains certain forward-looking statements
about the Company and the Bank. Forward-looking statements include
statements regarding anticipated future events and can be
identified by the fact that they do not relate strictly to
historical or current facts. They often include words such as
“believe,” “expect,” “anticipate,” “estimate,” and “intend” or
future or conditional verbs such as “will,” “would,” “should,”
“could,” or “may.” Forward-looking statements, by their nature, are
subject to risks and uncertainties. Certain factors that could
cause actual results to differ materially from expected results
include increased competitive pressures, changes in the interest
rate environment, general economic conditions or conditions within
the securities markets, and legislative, accounting and regulatory
changes that could adversely affect the business in which the
Company and the Bank are engaged.
Further, given its ongoing and dynamic nature, it is difficult
to predict the full impact of the COVID-19 pandemic on the
Company’s business. The extent of such impact will depend on future
developments, which are highly uncertain, including if the
coronavirus can continue to be controlled and abated and if the
economy is able to remain open. As the result of the COVID-19
pandemic and the related adverse local and national economic
consequences, the Company could be subject to any of the following
risks, any of which could have a material, adverse effect on the
Company’s business, financial condition, liquidity, and results of
operations: demand for the Company’s products and services may
decline, making it difficult to grow assets and income; if the
economy is unable to substantially remain open, and higher levels
of unemployment continue for an extended period of time, loan
delinquencies, problem assets, and foreclosures may increase,
resulting in increased charges and reduced income; collateral for
loans, especially real estate, may decline in value, which could
cause loan losses to increase; the Company’s allowance for loan
losses may have to be increased if borrowers experience financial
difficulties, which will adversely affect the Company’s net income;
the net worth and liquidity of loan guarantors may decline,
impairing their ability to honor commitments to us; the Company’s
cyber security risks are increased as the result of an increase in
the number of employees working remotely; and FDIC premiums may
increase if the agency experience additional resolution costs.
The Company undertakes no obligation to revise these
forward-looking statements or to reflect events or circumstances
after the date of this press release.
[1] This number represents a non-GAAP Financial Measure. Please
see “Reconciliation of GAAP to Non-GAAP” contained at the end of
this release. [2] This number represents a non-GAAP Financial
Measure. Please see “Reconciliation of GAAP to Non-GAAP” contained
at the end of this release.
BOGOTA FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF
FINANCIAL CONDITION
As of
As of
September 30, 2021
December 31, 2020
Assets
(unaudited)
Cash and due from banks
$
9,044,291
$
5,957,564
Interest-bearing deposits in other
banks
107,284,223
74,428,175
Cash and cash equivalents
116,328,514
80,385,739
Securities available for sale
18,212,547
11,870,508
Securities held to maturity (fair value of
$75,904,990 and $58,872,451, respectively)
75,020,011
57,504,443
Loans held for sale
996,393
—
Loans, net of allowance of $2,153,174 and
$2,241,174, respectively
579,914,636
557,690,853
Premises and equipment, net
8,130,775
5,671,097
Federal Home Loan Bank (FHLB) stock and
other restricted securities
5,134,000
5,928,100
Accrued interest receivable
2,725,700
2,855,425
Core deposit intangibles
354,877
—
Bank-owned life insurance
25,307,462
16,915,637
Other assets
2,908,487
2,083,076
Total Assets
$
835,033,402
$
740,904,878
Liabilities and Equity
Non-interest bearing deposits
$
36,207,139
$
27,061,629
Interest bearing deposits
555,012,875
474,911,402
Total Deposits
591,220,014
501,973,031
FHLB advances
90,102,901
104,290,920
Advance payments by borrowers for taxes
and insurance
3,589,197
2,560,089
Other liabilities
4,506,174
3,612,762
Total liabilities
689,418,286
612,436,802
Commitments and Contingencies
—
—
Stockholders’ Equity
Preferred stock $0.01 par value 1,000,000
shares authorized, none issued and outstanding at September 30,
2021 and December 31, 2020
—
—
Common stock $0.01 par value, 30,000,000
shares authorized, 14,631,679 issued and outstanding at September
30, 2021 and 13,157,525 at December 31, 2020
146,316
131,575
Additional Paid-In capital
68,291,158
56,975,187
Retained earnings
82,846,943
77,359,737
Unearned ESOP shares (469,980 shares at
September 30, 2021 and 489,983 shares at December 31, 2020)
(5,499,507
)
(5,725,410
)
Accumulated other comprehensive loss
(169,794
)
(273,013
)
Total stockholders’ equity
145,615,116
128,468,076
Total liabilities and stockholders’
equity
$
835,033,402
$
740,904,878
BOGOTA FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF
INCOME
Three months ended September
30,
Nine months ended September
30,
2021
2020
2021
2020
(unaudited)
Interest income
Loans
$
5,967,013
$
5,391,077
$
17,116,855
$
15,734,259
Securities
Taxable
410,867
367,857
1,473,018
1,204,056
Tax-exempt
13,411
13,136
38,794
38,017
Other interest-earning assets
94,343
131,215
332,603
660,492
Total interest income
6,485,634
5,903,285
18,961,270
17,636,824
Interest expense
Deposits
1,040,669
1,836,627
3,354,897
6,194,460
FHLB advances
369,352
472,506
1,176,985
1,478,432
Total interest expense
1,410,021
2,309,133
4,531,882
7,672,892
Net interest income
5,075,613
3,594,152
14,429,388
9,963,932
Provision (credit) for loan losses
25,000
25,000
(88,000
)
275,000
Net interest income after provision
(credit) for loan losses
5,050,613
3,569,152
14,517,388
9,688,932
Non-interest income
Fees and service charges
53,696
13,407
98,989
45,451
Gain on sale of loans
127,111
—
647,213
—
Bargain purchase gain
—
—
1,933,397
—
Bank-owned life insurance
156,992
90,359
391,825
939,160
Other
36,613
4,287
154,882
12,470
Total non-interest income
374,412
108,053
3,226,306
997,081
Non-interest expense
Salaries and employee benefits
2,029,021
1,330,540
5,603,408
3,790,526
Occupancy and equipment
338,604
166,592
899,777
495,509
FDIC insurance assessment
49,000
45,000
163,300
116,000
Data processing
256,953
182,202
777,789
493,439
Advertising
60,000
30,000
180,000
131,814
Director fees
207,012
181,916
622,131
547,091
Professional fees
128,514
239,375
596,280
642,888
Merger fees
—
—
392,197
—
Core conversion costs
370,000
—
730,000
—
Contribution to charitable foundation
—
—
—
2,881,500
Other
337,002
218,395
820,803
527,560
Total non-interest expense
3,776,106
2,394,020
10,785,685
9,626,327
Income before income taxes
1,648,919
1,283,185
6,958,009
1,059,686
Income tax expense
606,744
326,769
1,470,803
37,781
Net income
$
1,042,175
$
956,416
$
5,487,206
$
1,021,905
Earnings per Share (basic and diluted)
$
0.07
$
0.08
$
0.40
$
0.09
Weighted average shares outstanding
14,019,317
12,657,453
13,694,117
12,004,881
BOGOTA FINANCIAL CORP.
SELECTED RATIOS
(unaudited)
(unaudited)
At or For the Three Months
Ended September 30,
At or For the Nine Months
Ended September 30,
2021
2020
2021
2020
Performance Ratios (1):
Return on average assets (2)
0.49
%
0.51
%
0.91
%
0.19
%
Return on average equity (3)
2.81
%
3.01
%
5.20
%
1.11
%
Interest rate spread (4)
2.43
%
1.71
%
2.33
%
1.58
%
Net interest margin (5)
2.58
%
1.97
%
2.50
%
1.90
%
Efficiency ratio (6)
69.29
%
64.66
%
61.06
%
87.82
%
Average interest-earning assets to average
interest-bearing liabilities
122.40
%
121.75
%
122.40
%
121.94
%
Net loans to deposits
98.09
%
114.28
%
98.09
%
114.28
%
Equity to assets (7)
17.39
%
16.85
%
17.39
%
16.85
%
Capital Ratios:
Tier 1 capital to average assets
17.67
%
17.38
%
Asset Quality Ratios:
Allowance for loan losses as a percent of
total loans
0.37
%
0.40
%
Allowance for loan losses as a percent of
non-performing loans
114.20
%
344.67
%
Net recoveries to average outstanding
loans during the period
0.00
%
0.00
%
Non-performing loans as a percent of total
loans
0.32
%
0.11
%
Non-performing assets as a percent of
total assets
0.23
%
0.09
%
(1)
Performance ratios are annualized.
(2)
Represents net income divided by average
total assets.
(3)
Represents net income divided by average
stockholders' equity.
(4)
Represents the difference between the
weighted average yield on average interest-earning assets and the
weighted average cost of average interest-bearing liabilities. Tax
exempt income is reported on a tax equivalent basis using a
combined federal and state marginal tax rate of 30%.
(5)
Represents net interest income as a
percent of average interest-earning assets. Tax exempt income is
reported on a tax equivalent basis using a combined federal and
state marginal tax rate of 30% for 2021 and 2020.
(6)
Represents non-interest expenses divided
by the sum of net interest income and non-interest income.
(7)
Represents average stockholders' equity
divided by average total assets.
LOANS Loans are summarized as follows at September 30,
2021 and December 31, 2020:
September 30, 2021
December 31, 2020
Real estate:
(unaudited)
Residential
$
328,878,125
$
340,000,989
Commercial and multi-family real
estate
177,530,098
171,634,451
Construction
37,150,933
9,930,959
Commercial and industrial
10,151,860
13,652,248
Consumer:
Home equity and other
28,356,794
24,713,380
Total loans
582,067,810
559,932,027
Allowance for loan losses
(2,153,174
)
(2,241,174
)
Net loans
$
579,914,636
$
557,690,853
The following tables set forth the distribution of total deposit
accounts, by account type, at the dates indicated.
At September 30,
At December
2021
2020
Amount
Percent
Average Rate
Amount
Percent
Average Rate
(Dollars in thousands)
(unaudited)
Noninterest bearing demand accounts
$
36,207
6.12
%
—
%
$
27,062
5.39
%
—
%
NOW accounts
57,147
9.67
0.8
28,672
5.71
0.74
Money market accounts
58,833
9.95
0.34
58,114
11.58
0.47
Savings accounts
66,389
11.23
0.26
31,761
6.33
1.25
Certificates of deposit
372,644
63.03
0.83
356,364
70.99
1.33
Total
$
591,220
100.00
%
0.66
%
$
501,973
100.00
%
1.06
%
Average Balance Sheets and Related Yields and Rates
The following tables present information regarding average
balances of assets and liabilities, the total dollar amounts of
interest income and dividends from average interest-earning assets,
the total dollar amounts of interest expense on average
interest-bearing liabilities, and the resulting annualized average
yields and costs. The yields and costs for the periods indicated
are derived by dividing income or expense by the average balances
of assets or liabilities, respectively, for the periods presented.
Average balances have been calculated using daily balances.
Nonaccrual loans are included in average balances only. Loan fees
are included in interest income on loans and are not material.
Three Months Ended September
30,
2021
2020
Average Balance
Interest and Dividends
Yield/ Cost (3)
Average Balance
Interest and Dividends
Yield/ Cost (3)
(Dollars in thousands)
Assets:
Cash and cash equivalents
$
101,453
$
33
0.13
%
$
66,865
$
48
0.29
%
Loans
584,754
5,967
4.05
%
586,497
5,391
3.66
%
Securities
88,619
424
1.91
%
64,431
381
2.37
%
Other interest-earning assets
5,521
62
4.49
%
6,175
83
5.35
%
Total interest-earning assets
780,347
6,486
3.30
%
723,968
5,903
3.24
%
Non-interest-earning assets
52,346
29,150
Total assets
$
832,693
$
753,118
Liabilities and equity:
NOW and money market accounts
$
108,411
$
148
0.54
%
$
64,710
$
128
0.79
%
Savings accounts
64,076
36
0.22
%
30,834
20
0.26
%
Certificates of deposit
375,495
857
0.91
%
390,451
1,689
1.72
%
Total interest-bearing deposits
547,982
1,041
0.75
%
485,995
1,837
1.50
%
Federal Home Loan Bank advances
96,041
369
1.52
%
108,624
472
1.73
%
Total interest-bearing liabilities
644,023
1,410
0.87
%
594,619
2,309
1.54
%
Non-interest-bearing deposits
33,330
24,301
Other non-interest-bearing liabilities
10,246
7,320
Total liabilities
687,599
626,240
Total equity
145,094
126,878
Total liabilities and equity
$
832,693
$
753,118
Net interest income
$
5,076
$
3,594
Interest rate spread (1)
2.43
%
1.70
%
Net interest margin (2)
2.58
%
1.97
%
Average interest-earning assets to average
interest-bearing liabilities
121.17
%
121.75
%
- Interest rate spread represents the difference between the
weighted average yield on interest-earning assets and the weighted
average cost of interest-bearing liabilities.
- Net interest margin represents net interest income divided by
average total interest-earning assets.
- Annualized.
Nine Months Ended September
30,
2021
2020
Average Balance
Interest and Dividends
Yield/ Cost (3)
Average Balance
Interest and Dividends
Yield/ Cost (3)
(Dollars in thousands)
Assets:
Cash and cash equivalents
$
97,579
$
119
0.16
%
$
65,915
$
399
0.81
%
Loans
585,156
17,117
3.91
%
562,399
15,734
3.73
%
Securities
81,900
1,512
2.46
%
65,879
1,242
2.51
%
Other interest-earning assets
5,785
213
4.92
%
6,033
262
5.79
%
Total interest-earning assets
770,420
18,961
3.29
%
700,226
17,637
3.36
%
Non-interest-earning assets
40,177
28,526
Total assets
$
810,597
$
728,752
Liabilities and equity:
NOW and money market accounts
$
99,261
$
427
0.57
%
$
53,634
$
385
0.96
%
Savings accounts
56,982
84
0.20
%
29,766
57
0.26
%
Certificates of deposit
374,101
2,844
1.02
%
386,250
5,752
1.99
%
Total interest-bearing deposits
530,344
3,355
0.85
%
469,650
6,194
1.76
%
Federal Home Loan Bank advances
101,249
1,177
1.55
%
104,567
1,479
1.89
%
Total interest-bearing liabilities
631,593
4,532
0.96
%
574,217
7,673
1.78
%
Non-interest-bearing deposits
28,602
20,171
Other non-interest-bearing liabilities
9,458
11,204
Total liabilities
669,653
605,592
Total equity
140,944
123,160
Total liabilities and equity
$
810,597
$
728,752
Net interest income
$
14,429
$
9,964
Interest rate spread (1)
2.33
%
1.58
%
Net interest margin (2)
2.50
%
1.90
%
Average interest-earning assets to average
interest-bearing liabilities
121.98
%
121.94
%
- Interest rate spread represents the difference between the
weighted average yield on interest-earning assets and the weighted
average cost of interest-bearing liabilities.
- Net interest margin represents net interest income divided by
average total interest-earning assets.
- Annualized.
Rate/Volume Analysis
The following table sets forth the effects of changing rates and
volumes on net interest income. The rate column shows the effects
attributable to changes in rate (changes in rate multiplied by
prior volume). The volume column shows the effects attributable to
changes in volume (changes in volume multiplied by prior rate). The
net column represents the sum of the prior columns. Changes
attributable to changes in both rate and volume that cannot be
segregated have been allocated proportionally based on the changes
due to rate and the changes due to volume.
Three Months Ended September
30, 2021 Compared to Three Months Ended September 30, 2020
Nine Months Ended September
30, 2021 Compared to Nine Months Ended September 30, 2020
Increase (Decrease) Due
to
Increase (Decrease) Due
to
Volume
Rate
Net
Volume
Rate
Net
(In thousands)
Interest income:
Cash and cash equivalents
$
45
$
(60
)
$
(15
)
$
51
$
(331
)
$
(280
)
Loans receivable
(71
)
647
576
890
493
1,383
Securities
462
(419
)
43
394
(124
)
270
Other interest earning assets
(29
)
8
(21
)
(12
)
(37
)
(49
)
Total interest-earning assets
407
176
583
1,323
1
1,324
Interest expense:
NOW and money market accounts
236
(216
)
20
260
(218
)
42
Savings accounts
73
(57
)
16
54
(27
)
27
Certificates of deposit
(136
)
(696
)
(832
)
(124
)
(2,784
)
(2,908
)
Federal Home Loan Bank advances
(191
)
88
(103
)
(51
)
(251
)
(302
)
Total interest-bearing liabilities
(18
)
(881
)
(899
)
139
(3,280
)
(3,141
)
Net increase (decrease) in net interest
income
$
425
$
1,057
$
1,482
$
1,184
$
3,281
$
4,465
BOGOTA FINANCIAL CORP. RECONCILIATION
OF GAAP TO NON-GAAP
The Company’s management believes that the presentation of net
income on a non-GAAP basis, excluding nonrecurring items, provides
useful information for evaluating the Company’s operating results
and any related trends that may be affecting the Company’s
business. These disclosures should not be viewed as a substitute
for operating results determined in accordance with GAAP.
Three months ended September
30, 2021
Income Before Income Taxes
Provision for Income Taxes
Net Income
GAAP basis
$
1,648,919
$
606,744
$
1,042,175
Add: merger-related expenses
—
—
—
Non-GAAP basis
$
1,648,919
$
606,744
$
1,042,175
Three months ended September
30, 2020
Income Before Income Taxes
Provision for Income Taxes
Net Income
GAAP basis
$
1,283,185
$
326,769
$
956,416
Add: merger-related expenses
$
78,606
$
-
$
78,606
Non-GAAP basis
$
1,361,791
$
326,769
$
1,035,022
Nine months ended September
30, 2021
Income Before Income Taxes
Provision for Income Taxes
Net Income
GAAP basis
$
6,958,009
$
1,470,803
$
5,487,206
Add: merger and acquisition related
expenses
392,197
—
392,197
ADD: Charitable Foundation
Contribution
—
—
—
Less: Bargain purchase gain
(1,933,397
)
—
(1,933,397
)
Non-GAAP basis
$
5,416,809
$
1,470,803
$
3,946,006
Nine months ended September
30, 2020
Income Before Income Taxes
Provision for Income Taxes
Net Income
GAAP basis
$
1,059,686
$
37,781
$
1,021,905
Add: merger and acquisition related
expenses
78,606
—
78,606
Add: Charitable Foundation
Contribution
2,881,500
809,990
2,071,510
Less: Bargain purchase gain
—
—
—
Non-GAAP basis
$
4,019,792
$
847,771
$
3,172,021
Nine months ended September
30,
Return on average assets (annualized):
2021
2020
GAAP
0.91
%
0.19
%
Adjustments
0.26
%
0.36
%
Non-GAAP
0.65
%
0.55
%
Return on average equity (annualized):
GAAP
5.20
%
1.11
%
Adjustments
1.46
%
2.14
%
Non-GAAP
3.74
%
3.25
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211103006183/en/
Joseph Coccaro – President & CEO, 201-862-0660 ext. 1110
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