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, 2022 of $1.9
million, compared to net income of $1.0 million for the comparable
prior year period. The Company reported net income for the nine
months ended September 30, 2022 of $5.0 million compared to net
income of $5.5 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, each of which was associated with the acquisition of
Gibraltar Bank. Excluding the bargain purchase gain and the
merger-related expenses in 2021, net income for the nine months
ended September 30, 2021 was $3.9 million, compared to the $5.0
million for the current year nine-month period1.
On April 11, 2022, the Company announced it completed its
initial 5% buyback plan, purchasing 296,044 shares at an average
cost of $10.82 per share. On May 25, 2022, the Company announced
that it had received regulatory approval for the repurchase of up
to 292,568 shares of its common stock, which was approximately 5%
of its then outstanding common stock. On September 21, 2022, the
Company completed the second buyback plan by repurchasing 292,568
shares at an average cost of $11.14 per share. On October 3, 2022,
the Company announced that it had received regulatory approval for
the repurchase of up to 556,631 shares of its common stock, which
was approximately 10% of its then outstanding common stock.
Other Financial Highlights:
- Total assets increased $108.8 million, or 13.0%, to $946.2
million at September 30, 2022 from $837.4 million at December 31,
2021, due to an increase in loans and securities, which was
primarily funded by cash and cash equivalents, deposits and
borrowings.
- Net loans increased $136.9 million, or 24.0%, to $707.1 million
at September 30, 2022 from $570.2 million at December 31,
2021.
- Total deposits were $668.2 million, increasing $70.7 million,
or 11.8%, as compared to $597.5 million at December 31, 2021,
primarily due to a new $27.0 million municipal deposit relationship
and $78.8 million in increased certificates of deposit. The average
rate paid on deposits at September 30, 2022 increased 45 basis
points to 1.06% at September 30, 2022 from 0.61% at December 31,
2021, due to higher interest rates.
- Return on average assets was 0.76% for the nine-month period
ended September 30, 2022 compared to 0.91% for the comparable
period in 2021. Without the bargain purchase gain and
merger-related expenses in 2021, the return on average assets would
have been 0.65%1 for the nine-month period ended September 30,
2021.
- Return on average equity was 4.62% for the nine-month period
ended September 30, 2022 compared to 5.20% for the comparable
period in 2021. Without the bargain purchase gain and
merger-related expenses in 2021, the return on average equity would
have been 3.74%1 for the nine-month period ended September 30,
2021.
[1] This number represents a non-GAAP financial measure. Please
see “Reconciliation of GAAP to Non-GAAP” contained at the end of
this release.
Joseph Coccaro, President and Chief Executive Officer, said, “We
are pleased with our results for the first nine months of 2022. We
had over $198 million in new loan originations, which increased our
loan portfolio by $137 million during the year. We also continue to
have strong credit quality as non-performing loans and criticized
assets remain very low. We continue to see improvement in our net
interest margin which rose 27 basis points and 28 basis points as
compared to the three and nine months ended September 30, 2021,
respectively.”
Mr. Coccaro further stated, "In 2021, we completed the
acquisition of Gibraltar Bank, which included a business system
conversion, and opened our sixth branch location in Hasbrouck
Heights. We expect loan growth to slow in the fourth quarter as
interest rates increase, higher inflation and the continued low
inventory in housing will slow the market. This year, we exceeded
our asset goal of $900 million."
Income Statement Analysis
Comparison of Operating Results for the Three Months Ended
September 30, 2022 and September 30, 2021
Net income increased by $888,000, or 85.2%, to $1.9 million for
the three months ended September 30, 2022 from $1.0 million for the
three months ended September 30, 2021. The increase was due to an
increase in net interest income of $1.1 million and a decrease of
$137,000 in non-interest expense, offset by a decrease in
non-interest income of $105,000 and an increase of $150,000 in
provision for loan losses.
Interest income on cash and cash equivalents decreased $2,000,
or 6.1%, to $31,000 for the three months ended September 30, 2022
from $33,000 for the three months ended September 30, 2021 due to a
$95.5 million decrease in the average balance of cash and cash
equivalents to $5.9 million for the three months ended September
30, 2022 from $101.5 million for the three months ended September
30, 2021, reflecting the use of excess liquidity to fund loan
originations and purchase investment securities. This was offset by
a 192 basis point increase in the average yield on cash and cash
equivalents from 0.13% for the three months ended September 30,
2021 to 2.05% for the three months ended September 30, 2022 due to
the higher interest rate environment.
Interest income on loans increased $1.1 million, or 17.6%, to
$7.0 million for the three months ended September 30, 2022 compared
to $6.0 million for the three months ended September 30, 2021 due
primarily to an $85.4 million increase in the average balance of
loans to $670.1 million for the three months ended September 30,
2022 from $584.8 million for the three months ended September 30,
2021 and, to a lesser extent, due to a ten basis point increase in
the average yield on loans from 4.05% for the three months ended
September 30, 2021 to 4.15% for the three months ended September
30, 2022.
Interest income on securities increased $637,000, or 150.2%, to
$1.1 million for the three months ended September 30, 2022 from
$424,000 for the three months ended September 30, 2021 due
primarily to a $94.0 million increase in the average balance of
securities to $182.6 million for the three months ended September
30, 2022 from $88.6 million for the three months ended September
30, 2021, reflecting the purchase of investments with excess
liquidity, and to a lesser extent, due to a 41 basis point increase
in the average yield from 1.91% for the three months ended
September 30, 2021 to 2.32% for the three months ended September
30, 2022.
Interest expense on interest-bearing deposits increased
$209,000, or 20.1%, to $1.2 million for the three months ended
September 30, 2022 from $1.0 million for the three months ended
September 30, 2021. The increase was due to a seven basis point
increase in the average cost of interest-bearing deposits to 0.82%
for the three months ended September 30, 2022 from 0.75% for the
three months ended September 30, 2021. The increase in the average
cost of deposits was due to higher average balances and higher
average costs of certificates of deposit. This increase was also
due to a $54.2 million increase in the average balance of total
deposits to $602.2 million for the three months ended September 30,
2022 from $548.0 million for the three months ended September 30,
2021.
Interest expense on Federal Home Loan Bank borrowings increased
$348,000, or 94.3%, from $369,000 for the three months ended
September 30, 2021 to $717,000 for the three months ended September
30, 2022. The increase was due to an increase in the average cost
of borrowings of 78 basis points to 2.30% for the three months
ended September 30, 2022 from 1.52% for the three months ended
September 30, 2021 due to the higher borrowing rates. The increase
was also due to an increase in the average balance of borrowings of
$32.5 million to $128.5 million for the three months ended
September 30, 2022 from $96.0 million for the three months ended
September 30, 2021.
Net interest income increased $1.1 million, or 22.3%, to $6.2
million for the three months ended September 30, 2022 from $5.1
million for the three months ended September 30, 2021. The increase
reflected a 25 basis point increase in our net interest rate spread
to 2.68% for the three months ended September 30, 2022 from 2.43%
for the three months ended September 30, 2021. The net interest
margin increased 27 basis points to 2.85% for the three months
ended September 30, 2022 from 2.58% for the three months ended
September 30, 2021.
We recorded a $175,000 provision for loan losses for the three
months ended September 30, 2022 compared to a $25,000 provision for
the three-month period ended September 30, 2021. Higher balances in
residential and construction loans were the reason for the
provision for the three months ended September 30, 2022. 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 decreased by $105,000, or 28.0%, to $270,000
for the three months ended September 30, 2022 from $374,000 for the
three months ended September 30, 2021. Gain on sale of loans
decreased $127,000 as the Bank decided to portfolio loans rather
than sell loans. This decrease was offset by a $28,000, or 17.8%,
increase in bank-owned life insurance to $185,000 for the three
months ended September 30, 2022 from $157,000 for the three months
ended September 30, 2022 due to $5.0 million purchase of bank-owned
life insurance during the nine months ended September 30, 2022.
For the three months ended September 30, 2022, non-interest
expense decreased $137,000, or 3.6%, over the comparable 2021
period primarily due to the $370,000 of expense related to the data
processing conversion in 2021. Salaries and employee benefits
increased $125,000, or 6.2%, due to the stock compensation plan
established in September 2021 and due to more employees due to the
acquisition and the addition of a sixth branch office. Data
processing expense increased $54,000, or 21.1%, due to higher costs
associated with being a larger organization. Professional fees
increased $35,000, or 27.2%, due in part to the settlement of a
legal case in 2022. The increase in advertising expense of $96,000,
or 160.2%, was due to additional promotions for branch locations
and new promotions on deposit and loan products.
Comparison of Operating Results for the Nine Months Ended
September 30, 2022 and September 30, 2021
Net income decreased by $514,000, or 9.4%, to $5.0 million for
the nine months ended September 30, 2022 from $5.5 million for the
nine months ended September 30, 2021. The decrease was due to a
decrease in non-interest income of $2.4 million, an increase in
provision for loan losses of $363,000, and an increase of $412,000
in income taxes, offset by an increase in net interest income of
$2.6 million. Excluding the one-time bargain purchase gain of $1.9
million that occurred in 2021 in connection with the Gibraltar Bank
acquisition and the $392,000 merger-related expenses, net income
was $3.9 million for the nine months ended September 30, 2021
compared to $5.0 million for the current year period1.
Interest income on cash and cash equivalents decreased $31,000,
or 26.1%, to $88,000 for the nine months ended September 30, 2022
from $119,000 for the nine months ended September 30, 2021 due to a
$65.1 million decrease in the average balance of cash and cash
equivalents to $32.5 million for the nine months ended September
30, 2022 from $97.6 million for the nine months ended September 30,
2021, reflecting the use of excess liquidity to fund loan
originations and purchase investment securities. This was offset by
a 20 basis point increase in the average yield on cash and cash
equivalents from 0.16% for the nine months ended September 30, 2021
to 0.36% for the nine months ended September 30, 2022 due to the
higher interest rate environment.
Interest income on loans increased $1.3 million, or 7.5%, to
$18.4 million for the nine months ended September 30, 2022 compared
to $17.1 million for the nine months ended September 30, 2021 due
primarily to a $27.1 million increase in the average balance of
loans to $612.3 million for the nine months ended September 30,
2022 from $585.2 million for the nine months ended September 30,
2021 and, to a lesser extent, due to a ten basis point increase in
the average yield on loans from 3.91% for the nine months ended
September 30, 2021 to 4.01% for the nine months ended September 30,
2022.
[1] This number represents a non-GAAP financial measure. Please
see “Reconciliation of GAAP to Non-GAAP” contained at the end of
this release.
Interest income on securities increased $1.2 million, or 78.4%,
to $2.7 million for the nine months ended September 30, 2022 from
$1.5 million for the nine months ended September 30, 2021 due to a
$86.2 million increase in the average balance of securities to
$168.1 million for the nine months ended September 30, 2022 from
$81.9 million for the nine months ended September 30, 2021,
reflecting the purchase of investments with excess liquidity. The
increase was offset by a 32 basis point decrease in the average
yield from 2.46% for the nine months ended September 30, 2021 to
2.14% for the nine months ended September 30, 2022.
Interest expense on interest-bearing deposits decreased
$430,000, or 12.8%, to $2.9 million for the nine months ended
September 30, 2022 from $3.4 million for the nine months ended
September 30, 2021. The decrease was due primarily to an 18 basis
point decrease in the average cost of interest-bearing deposits to
0.67% for the nine months ended September 30, 2022 from 0.85% for
the nine months ended September 30, 2021. The decrease in the
average cost of deposits was due to a higher average balance of
core deposits, offset by a decrease in the average balance and
average cost of certificates of deposit. This decrease was offset
by a $50.6 million increase in the average balance of deposits to
$581.0 million for the nine months ended September 30, 2022 from
$530.3 million for the nine months ended September 30, 2021,
primarily due to a $47.4 million increase in the average balance of
NOW and money market accounts from $99.3 million for the nine
months ended September 30, 2021 to $146.7 million for the nine
months ended September 30, 2022.
Interest expense on Federal Home Loan Bank borrowings increased
$226,000, or 19.2%, from $1.2 million for the nine months ended
September 30, 2021 to $1.4 million for the nine months ended
September 30, 2022. The increase was due to an increase in the
average cost of borrowings of 37 basis points to 1.92% for the nine
months ended September 30, 2022 from 1.55% for the nine months
ended September 30, 2021 due to the higher new borrowing rates. The
increase was offset by a decrease in the average balance of
borrowings of $3.7 million to $97.6 million for the nine months
ended September 30, 2022 from $101.2 million for the nine months
ended September 30, 2021.
Net interest income increased $2.6 million, or 18.1%, to $17.0
million for the nine months ended September 30, 2022 from $14.4
million for the nine months ended September 30, 2021. The increase
reflected a 30 basis point increase in the net interest rate spread
to 2.63% for the nine months ended September 30, 2022 from 2.33%
for the nine months ended September 30, 2021. The net interest
margin increased 28 basis points to 2.78% for the nine months ended
September 30, 2022 from 2.50% for the nine months ended September
30, 2021.
We recorded a $275,000 provision for loan losses the nine months
ended September 30, 2022 compared to a $88,000 credit for the nine
months ended September 30, 2021. Higher balances in residential and
construction loans were the reason for the provision for the nine
months ended September 30, 2022. 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 decreased by $2.4 million, or 73.1%, to
$868,000 for the nine months ended September 30, 2022 from $3.2
million for the nine months ended September 30, 2021. For the nine
months ended September 30, 2021, there was a $1.9 million bargain
purchase gain recognized in the Gibraltar Bank acquisition in 2021.
Gain on sale of loans decreased $560,000 or 86.6% to $87,000 for
the nine months ended September 30, 2022 from $647,000 for the nine
months ended September 30, 2021. Bank-owned life insurance income
increased $119,000, or 30.3%, to $511,000 for the nine months ended
September 30, 2022 from $392,000 for the nine months ended
September 30, 2021 due to a $5.0 million purchase of bank-owned
life insurance during the nine months ended September 30, 2022.
For the nine months ended September 30, 2022, non-interest
expense decreased $12,000, or 0.1%, to $10.8 million, over the
comparable 2021 period. Salaries and employee benefits increased
$713,000, or 12.7%, due to stock compensation plan implemented in
September 2021 and due to more employees due to the acquisition and
the addition of a sixth branch office. Data processing expense
increased $143,000, or 18.3%, due to higher data processing expense
associated with a larger company. Advertising expense increased
$188,000 due to additional promotions for branch locations and new
promotions for loan and deposit products. Professional fees
decreased $137,000, or 23.0%, due to lower consulting expense.
Merger fees and core conversion costs were $1.1 million in 2021.
The increase in equipment and occupancy expenses of $134,000, or
14.9%, was mainly due to the additional branch locations.
Balance Sheet Analysis
Total assets were $946.2 million at September 30, 2022,
representing an increase of $108.8 million, or 13.0%, from December
31, 2021. Cash and cash equivalents decreased $91.7 million during
the period primarily due to funding of loan originations and
investment purchases with excess liquidity. Net loans increased
$136.9 million, or 24.0%, due to new production of $198.1 million,
consisting of a mainly residential real estate loans and
construction real estate loans offset by $61.2 million in
repayments. Securities held to maturity increased $10.1 million due
to the purchase of corporate bonds and mortgage-backed securities
with excess cash. Securities available for sale increased $46.3
million due to the purchase of mortgage-backed securities and
corporate bonds with excess cash. Bank-owned life insurance
increased $5.5 million, or 22.4%, due to a $5.0 million new
purchase of bank-owned life insurance during the nine months ended
September 30, 2022.
Delinquent loans decreased $544,000, or 20.7%, during the
nine-month period ended September 30, 2022, finishing at $2.0
million or 0.28% of total loans. During the same timeframe,
non-performing assets remained unchanged at $1.9 million and were
0.20% of total assets at September 30, 2022. The Company’s
allowance for loan losses was 0.36% of total loans and 128.8% of
non-performing loans at September 30, 2022 compared to 0.37% of
total loans and 114.20% of non-performing loans at September 30,
2021.
Total liabilities increased $115.3 million, or 16.7%, to $805.1
million mainly due to an increase in deposits, reflecting a new
$27.0 million municipal relationship, a $78.8 increase in
certificates of deposit and a $43.1 million increase in borrowings.
Total deposits increased $70.7 million, or 11.8%, to $668.2 million
at September 30, 2022 from $597.5 million at December 31, 2021. The
increase in deposits reflected an increase in interest-bearing
deposits of $73.4 million, or 13.1%, to $631.5 million as of
September 30, 2022 from $558.2 million at December 31, 2021,
primarily due to increases in certificates of deposit, which
increased by $78.8 million from $366.4 million at December 31, 2021
to $445.2 million at September 30, 2022 and in NOW accounts, which
increased by $11.2 million to $81.1 million from $69.9 million at
December 31, 2021. These increases were offset by a decrease in
non-interest bearing deposits of $2.7 million, or 6.8%, to $36.6
million as of September 30, 2022 from $39.3 million as of December
31, 2021. Federal Home Loan Bank advances increased $43.1 million,
or 50.6%, due to new advances for loan funding.
Stockholders’ equity decreased $6.5 million to $141.1 million,
due to increased accumulated other comprehensive loss for
securities available for sale of $6.4 million and the repurchase of
546,421 shares of stock during the year at a cost of $6.0 million,
offset by net income of $5.0 million for the nine months ended
September 30, 2022. At September 30, 2022, the Company’s ratio of
average stockholders’ equity-to-total assets was 17.08%, compared
to 17.43% at September 30, 2021.
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, inflation, general economic conditions or
conditions within the securities markets, changes in the quality of
our loan and security portfolios, increases in non-performing and
classified loans, and legislative, accounting and regulatory
changes that could adversely affect the business in which the
Company and the Bank are engaged.
In addition, the COVID-19 pandemic has had, and may continue to
have, an adverse impact on the Company, its clients and the
communities it serves. Given its dynamic nature, it is difficult to
predict the full impact of the COVID-19 pandemic on the Company’s
business.
The Company undertakes no obligation to revise these
forward-looking statements or to reflect events or circumstances
after the date of this press release.
BOGOTA FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF
FINANCIAL CONDITION
As of
As of
September 30, 2022
December 31, 2021
Assets
(unaudited)
Cash and due from banks
$
8,885,168
$
14,446,792
Interest-bearing deposits in other
banks
4,440,605
90,621,993
Cash and cash equivalents
13,325,773
105,068,785
Securities available for sale
88,091,340
41,838,798
Securities held to maturity (fair value of
$76,552,406 and $74,081,059, respectively)
84,128,385
74,053,099
Loans held for sale
—
1,152,500
Loans, net of allowance of $2,428,174 and
$2,153,174, respectively
707,119,408
570,209,669
Premises and equipment, net
7,954,437
8,127,979
Federal Home Loan Bank (FHLB) stock and
other restricted securities
6,663,500
4,851,300
Accrued interest receivable
3,411,329
2,712,605
Core deposit intangibles
283,802
336,364
Bank-owned life insurance
30,021,952
24,524,122
Other assets
5,205,892
4,486,366
Total Assets
$
946,205,818
$
837,361,587
Liabilities and Equity
Non-interest bearing deposits
$
36,635,406
$
39,317,500
Interest bearing deposits
631,524,062
558,162,278
Total Deposits
668,159,468
597,479,778
FHLB advances
128,111,317
85,051,736
Advance payments by borrowers for taxes
and insurance
3,921,880
2,856,120
Other liabilities
4,894,794
4,397,742
Total liabilities
805,087,459
689,785,376
Stockholders’ Equity
Preferred stock $0.01 par value 1,000,000
shares authorized, none issued and outstanding at September 30,
2022 and December 31, 2021
—
—
Common stock $0.01 par value, 30,000,000
shares authorized, 14,059,388 issued and outstanding at September
30, 2022 and 14,605,809 at December 31, 2021
140,593
146,057
Additional paid-in capital
62,978,243
68,247,204
Retained earnings
89,853,322
84,879,812
Unearned ESOP shares (443,236 shares at
September 30, 2022 and 463,239 shares at December 31, 2021)
(5,198,303
)
(5,424,206
)
Accumulated other comprehensive loss
(6,655,496
)
(272,656
)
Total stockholders’ equity
141,118,359
147,576,211
Total liabilities and stockholders’
equity
$
946,205,818
$
837,361,587
BOGOTA FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF
INCOME
(unaudited)
Three months ended September
30,
Nine months ended September
30,
2022
2021
2022
2021
Interest income
Loans
$
7,018,200
$
5,967,013
$
18,403,802
$
17,116,855
Securities
Taxable
1,013,034
410,867
2,582,869
1,473,018
Tax-exempt
48,027
13,411
115,305
38,794
Other interest-earning assets
96,139
94,343
263,634
332,603
Total interest income
8,175,400
6,485,634
21,365,610
18,961,270
Interest expense
Deposits
1,249,693
1,040,669
2,925,685
3,354,897
FHLB advances
716,705
369,352
1,402,741
1,176,985
Total interest expense
1,966,398
1,410,021
4,328,426
4,531,882
Net interest income
6,209,002
5,075,613
17,037,184
14,429,388
Provision (credit) for loan losses
175,000
25,000
275,000
(88,000
)
Net interest income after provision for
loan losses
6,034,002
5,050,613
16,762,184
14,517,388
Non-interest income
Fees and service charges
47,090
53,696
136,886
98,989
(Loss) gain on sale of loans
—
127,111
86,913
647,213
Bargain purchase gain
—
—
—
1,933,397
Bank-owned life insurance
185,085
156,992
510,527
391,825
Other
37,336
36,613
133,325
154,882
Total non-interest income
269,511
374,412
867,651
3,226,306
Non-interest expense
Salaries and employee benefits
2,154,654
2,029,021
6,316,898
5,603,408
Occupancy and equipment
347,036
338,604
1,033,846
899,777
FDIC insurance assessment
54,000
49,000
162,000
163,300
Data processing
311,106
256,953
920,293
777,789
Advertising
156,145
60,000
368,435
180,000
Director fees
189,424
207,012
607,749
622,131
Professional fees
163,500
128,514
459,253
596,280
Merger fees
—
—
—
392,197
Core conversion costs
—
370,000
—
730,000
Other
262,890
337,002
905,428
820,803
Total non-interest expense
3,638,755
3,776,106
10,773,902
10,785,685
Income before income taxes
2,664,758
1,648,919
6,855,933
6,958,009
Income tax expense
734,152
606,744
1,882,423
1,470,803
Net income
$
1,930,606
$
1,042,175
$
4,973,510
$
5,487,206
Earnings per Share - basic
$
0.14
$
0.07
$
0.36
$
0.40
Earnings per Share - diluted
$
0.14
$
0.07
$
0.36
$
0.40
Weighted average shares outstanding -
basic
13,468,751
14,019,317
13,661,851
13,694,117
Weighted average shares outstanding -
diluted
13,529,857
14,019,317
13,704,688
13,694,117
BOGOTA FINANCIAL CORP.
SELECTED RATIOS
(unaudited)
At or For the Three Months
Ended September 30,
At or For the Nine Months
Ended September 30,
2022
2021
2022
2021
Performance Ratios (1):
Return on average assets (2)
0.95
%
0.49
%
0.76
%
0.91
%
Return on average equity (3)
5.56
%
2.81
%
4.62
%
5.20
%
Interest rate spread (4)
2.73
%
2.43
%
2.63
%
2.33
%
Net interest margin (5)
2.85
%
2.58
%
2.78
%
2.50
%
Efficiency ratio (6)
56.17
%
69.29
%
60.17
%
61.06
%
Average interest-earning assets to average
interest-bearing liabilities
120.42
%
122.40
%
120.59
%
122.40
%
Net loans to deposits
105.83
%
98.09
%
105.83
%
98.09
%
Equity to assets (7)
14.91
%
17.39
%
16.52
%
17.39
%
Capital Ratios:
Tier 1 capital to average assets
17.08
%
17.67
%
Asset Quality Ratios:
Allowance for loan losses as a percent of
total loans
0.36
%
0.37
%
Allowance for loan losses as a percent of
non-performing loans
128.84
%
114.20
%
Net recoveries to average outstanding
loans during the period
0.00
%
0.00
%
Non-performing loans as a percent of total
loans
0.27
%
0.32
%
Non-performing assets as a percent of
total assets
0.20
%
0.23
%
(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 2022 and 2021.
(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,
2022 and December 31, 2021:
September 30, 2022
December 31, 2021
Real estate:
(unaudited)
Residential
$
452,252,121
$
319,968,234
Commercial and multi-family real
estate
167,043,470
175,375,419
Construction
59,957,043
41,384,687
Commercial and industrial
1,908,487
7,905,524
Consumer:
Home equity and other
28,386,461
27,728,979
Total loans
709,547,582
572,362,843
Allowance for loan losses
(2,428,174
)
(2,153,174
)
Net loans
$
707,119,408
$
570,209,669
The following tables set forth the distribution of total deposit
accounts, by account type, at the dates indicated.
At September 30,
At December
2022
2021
Amount
Percent
Average Rate
Amount
Percent
Average Rate
(Dollars in thousands)
Noninterest bearing demand accounts
$
36,838
6.93
%
—
%
$
39,318
6.58
%
—
%
NOW accounts
81,096
12.14
0.49
69,940
11.71
0.82
Money market accounts
45,442
6.80
0.33
57,541
9.63
0.34
Savings accounts
59,592
8.92
0.26
64,285
10.76
0.26
Certificates of deposit
445,191
66.63
1.44
366,396
61.32
0.74
Total
$
668,159
100.00
%
1.06
%
$
597,480
100.00
%
0.61
%
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,
2022
2021
Average Balance
Interest and Dividends
Yield/ Cost (3)
Average Balance
Interest and Dividends
Yield/ Cost (3)
(Dollars in thousands)
Assets:
(unaudited)
Cash and cash equivalents
$
5,912
$
31
2.05
%
$
101,453
$
33
0.13
%
Loans
670,145
7,019
4.15
%
584,754
5,967
4.05
%
Securities
182,626
1,061
2.32
%
88,619
424
1.91
%
Other interest-earning assets
6,629
65
3.99
%
5,521
62
4.49
%
Total interest-earning assets
865,312
8,176
3.75
%
780,347
6,486
3.30
%
Non-interest-earning assets
51,273
52,346
Total assets
$
916,585
$
832,693
Liabilities and equity:
NOW and money market accounts
$
138,015
$
173
0.50
%
$
108,411
$
148
0.54
%
Savings accounts
60,912
40
0.26
%
64,076
36
0.22
%
Certificates of deposit
403,223
1,037
1.02
%
375,495
857
0.91
%
Total interest-bearing deposits
602,150
1,250
0.82
%
547,982
1,041
0.75
%
Federal Home Loan Bank advances
128,534
717
2.30
%
96,041
369
1.52
%
Total interest-bearing liabilities
730,684
1,967
1.08
%
644,023
1,410
0.87
%
Non-interest-bearing deposits
40,028
33,330
Other non-interest-bearing liabilities
4,232
10,246
Total liabilities
774,944
687,599
Total equity
141,641
145,094
Total liabilities and equity
$
916,585
$
832,693
Net interest income
$
6,209
$
5,076
Interest rate spread (1)
2.68
%
2.43
%
Net interest margin (2)
2.85
%
2.58
%
Average interest-earning assets to average
interest-bearing liabilities
118.42
%
121.17
%
1.
Interest rate spread represents the
difference between the weighted average yield on interest-earning
assets and the weighted average cost of interest-bearing
liabilities.
2.
Net interest margin represents net
interest income divided by average total interest-earning
assets.
3.
Annualized.
Rate/Volume Analysis
Nine Months Ended September
30,
2022
2021
Average Balance
Interest and Dividends
Yield/ Cost (3)
Average Balance
Interest and Dividends
Yield/ Cost (3)
(Dollars in thousands)
Assets:
Cash and cash equivalents
$
32,485
$
88
0.36
%
$
97,579
$
119
0.16
%
Loans
612,252
18,404
4.01
%
585,156
17,117
3.91
%
Securities
168,081
2,698
2.14
%
81,900
1,512
2.46
%
Other interest-earning assets
5,458
175
4.30
%
5,785
213
4.92
%
Total interest-earning assets
818,276
21,365
3.49
%
770,420
18,961
3.29
%
Non-interest-earning assets
52,040
40,177
Total assets
$
870,316
$
810,597
Liabilities and equity:
NOW and money market accounts
$
146,653
$
610
0.56
%
$
99,261
$
427
0.57
%
Savings accounts
64,509
126
0.26
%
56,982
84
0.20
%
Certificates of deposit
369,808
2,189
0.79
%
374,101
2,844
1.02
%
Total interest-bearing deposits
580,970
2,925
0.67
%
530,344
3,355
0.85
%
Federal Home Loan Bank advances
97,571
1,403
1.92
%
101,249
1,177
1.55
%
Total interest-bearing liabilities
678,541
4,328
0.85
%
631,593
4,532
0.96
%
Non-interest-bearing deposits
44,256
28,602
Other non-interest-bearing liabilities
3,705
9,458
Total liabilities
726,502
669,653
Total equity
143,814
140,944
Total liabilities and equity
$
870,316
$
810,597
Net interest income
$
17,037
$
14,429
Interest rate spread (1)
2.63
%
2.33
%
Net interest margin (2)
2.78
%
2.50
%
Average interest-earning assets to average
interest-bearing liabilities
120.59
%
121.98
%
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, 2022 Compared to Three Months Ended September 30, 2021
Nine Months Ended September
30, 2022 Compared to Nine Months Ended September 30, 2021
Increase (Decrease) Due
to
Increase (Decrease) Due
to
Volume
Rate
Net
Volume
Rate
Net
(In thousands)
Interest income:
(unaudited)
Cash and cash equivalents
$
(234
)
$
232
$
(2
)
$
(147
)
$
116
$
(31
)
Loans receivable
900
152
1,052
829
458
1,287
Securities
530
107
637
1,522
(336
)
1,186
Other interest earning assets
37
(34
)
3
(12
)
(26
)
(38
)
Total interest-earning assets
1,233
457
1,690
2,192
212
2,404
Interest expense:
NOW and money market accounts
88
(63
)
25
196
(13
)
183
Savings accounts
(10
)
14
4
13
29
42
Certificates of deposit
68
112
180
(32
)
(623
)
(655
)
Federal Home Loan Bank advances
138
210
348
(69
)
295
226
Total interest-bearing liabilities
284
273
557
108
(312
)
(204
)
Net increase (decrease) in net interest
income
$
949
$
184
$
1,133
$
2,084
$
524
$
2,608
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
$
-
$
-
$
-
Less: Bargain purchase gain
$
-
$
-
$
-
Non-GAAP basis
$
1,648,919
$
606,744
$
1,042,175
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,
Return on average assets (annualized):
2022
2021
GAAP
0.76
%
0.91
%
Adjustments
0.00
%
0.26
%
Non-GAAP
0.76
%
0.65
%
Return on average equity (annualized):
GAAP
4.62
%
5.20
%
Adjustments
0.00
%
1.46
%
Non-GAAP
4.62
%
3.74
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221028005039/en/
Joseph Coccaro – President & CEO, 201-862-0660 ext. 1110
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