• Penns Woods Bancorp, Inc. Reports Fourth Quarter and Year Ended 2022 Earnings

    المصدر: Nasdaq GlobeNewswire / 30 يناير 2023 11:16:00   America/Chicago

    WILLIAMSPORT, Pa., Jan. 30, 2023 (GLOBE NEWSWIRE) -- Penns Woods Bancorp, Inc. (NASDAQ: PWOD)

    Penns Woods Bancorp, Inc. achieved net income of $17.4 million for the twelve months ended December 31, 2022, resulting in basic and diluted earnings per share of $2.47.

    Highlights

    • Net income, as reported under GAAP, for the three and twelve months ended December 31, 2022 was $4.5 million and $17.4 million, respectively, compared to $4.9 million and $16.0 million for the same periods of 2021. Results for the three and twelve months ended December 31, 2022 compared to 2021 were impacted by an increase in after-tax securities losses of $315,000 (from a gain of $284,000 to a loss of $31,000) for the three month period and an increase in after-tax securities losses of $809,000 (from a gain of $521,000 to a loss of $288,000) for the twelve month period. Three and twelve month results for the periods ended December 31, 2022 were impacted by a goodwill impairment charge of $653,000 (after-tax $516,000) related to the wealth management unit (The M Group) as a decline in stock market valuations during 2022 resulted in a decreased level of net income for this entity. Results for the twelve months ended December 31, 2022 were impacted by additional compensation expense of $183,000 (after-tax $145,000) associated with the voluntary cash settlement of 346,725 outstanding stock options. In addition, an after-tax loss of $201,000 related to a branch closure negatively impacted results for the twelve months ended December 31, 2022.
    • The provision for loan losses increased $875,000 for the three months and $1.3 million for the twelve months ended December 31, 2022 to $575,000 and $1.9 million, respectively, compared to ($300,000) and $640,000 for the 2021 periods. The increases in the provision for loan losses were primarily due to the significant growth in the loan portfolio.
    • Basic and diluted earnings per share for the three and twelve months ended December 31, 2022 were $0.64 and $2.47. Basic and diluted earnings per share for the three and twelve months ended December 31, 2021 were $0.69 and $2.27.
    • Annualized return on average assets was 0.92% for three months ended December 31, 2022, compared to 1.02% for the corresponding period of 2021. Return on average assets was 0.90% for the twelve months ended December 31, 2022, compared to 0.85% for the corresponding period of 2021.
    • Annualized return on average equity was 10.92% for the three months ended December 31, 2022, compared to 11.59% for the corresponding period of 2021. Return on average equity was 10.73% for the twelve months ended December 31, 2022, compared to 9.93% for the corresponding period of 2021.

    Net Income

    Net income from core operations (“core earnings”), which is a non-generally accepted accounting principles (GAAP) measure of net income excluding net securities gains or losses and goodwill impairment, was $5.1 million for the three months ended December 31, 2022 compared to $4.6 million for the same period of 2021. Core earnings were $18.2 million for the twelve months ended December 31, 2022, compared to $15.5 million for the same period of 2021. Core earnings per share for the three months ended December 31, 2022 were $0.71 basic and diluted, compared to $0.65 basic and diluted core earnings per share for the same period of 2021. Core earnings per share for the twelve months ended December 31, 2022 were $2.58 basic and diluted, compared to $2.20 basic and diluted for the same period of 2021. Annualized core return on average assets and core return on average equity were 1.04% and 12.25% for the three months ended December 31, 2022, compared to 0.96% and 10.92% for the corresponding period of 2021. Core return on average assets and core return on average equity were 0.94% and 11.22% for the twelve months ended December 31, 2022 compared to 0.82% and 9.61% for the corresponding period of 2021. Core earnings for the twelve months ended December 31, 2022 were impacted negatively by an after-tax compensation expense of $145,000 relating to the voluntary cash settlement of 346,725 stock options along with an after-tax loss of $201,000 relating to a branch closure. A reconciliation of the non-GAAP financial measures of core earnings, core return on assets, core return on equity, and core earnings per share described in this press release to the comparable GAAP financial measures is included at the end of this press release.

    Net Interest Margin

    The net interest margin for the three and twelve months ended December 31, 2022 was 3.42% and 3.24%, compared to 2.90% and 2.85% for the corresponding periods of 2021. The increase in the net interest margin for the three and twelve month periods was driven by an increase in earning asset yield of 79 and 28 basis points ("bps") as the yield on earning assets increased during 2022 due to the rate increases enacted by the Federal Open Market Committee ("FOMC"). The three and twelve month periods ended December 31, 2022 were impacted by an increase of 58 and 8 bps in the yield earned on the securities portfolio as legacy securities matured with the funds reinvested at higher rates. The FOMC rate increases during 2022 and the utilization of excess on balance sheet liquidity during the first nine months of 2022 caused the rate paid on interest-bearing deposits to increase 19 and decrease 17 bps for the three months and twelve months ended December 31, 2022, respectively, compared to the comparable periods of 2021. The excess on balance sheet liquidity allowed deposit rates to be held at historically low levels for the majority of 2022 with rate increases occurring primarily during the fourth quarter of 2022.

    Assets

    Total assets increased $55.4 million to $2.0 billion at December 31, 2022 compared to December 31, 2021.  Cash and cash equivalents decreased $223.5 million as interest-bearing accounts in other financial institutions decreased $181.7 million and fed funds sold decreased $50.0 million as excess liquidity was primarily utilized to fund the growth in the loan portfolio. Net loans increased $246.1 million to $1.6 billion at December 31, 2022 compared to December 31, 2021, as an emphasis was placed on commercial loan growth coupled with a significant increase in indirect auto lending. The investment portfolio increased $31.8 million from December 31, 2021 to December 31, 2022 as a portion of the excess cash liquidity was invested primarily into short and medium-term municipal bonds with a maturity of 10 years or less.

    Non-performing Loans

    The ratio of non-performing loans to total loans ratio decreased to 0.30% at December 31, 2022 from 0.45% at December 31, 2021, as non-performing loans decreased to $4.9 million at December 31, 2022 from $6.3 million at December 31, 2021. The majority of non-performing loans involve loans that are either in a secured position and have sureties with a strong underlying financial position or have a specific allocation for any impairment recorded within the allowance for loan losses. Net loan charge-offs of $449,000 for the twelve months ended December 31, 2022 impacted the allowance for loan losses, which was 0.95% of total loans at December 31, 2022 compared to 1.02% at December 31, 2021.

    Deposits

    Deposits decreased $64.9 million to $1.6 billion at December 31, 2022 compared to December 31, 2021. Noninterest-bearing deposits increased $24.7 million to $519.1 million at December 31, 2022 compared to December 31, 2021.  Driving core deposit gathering efforts was the continued emphasis on increasing the utilization of electronic (internet and mobile) deposit banking among our customers. Utilization of internet and mobile banking has increased since the start of 2020 due to these efforts coupled with a change in consumer behavior due to the business and travel restrictions caused by the COVID-19 pandemic. Interest-bearing deposits decreased $89.6 million primarily due to a reduction in the Money Market Account portfolio coupled with the maturity of higher cost time deposits. A campaign to attract time deposits with a maturity of ten to twenty-four months was started during the latter part of 2022.

    Shareholders’ Equity

    Shareholders’ equity decreased $4.6 million to $167.7 million at December 31, 2022 compared to December 31, 2021.  Accumulated other comprehensive loss of $14.0 million at December 31, 2022 increased from a loss of $1.1 million at December 31, 2021 as a result of a $9.8 million net unrealized loss on available for sale securities at December 31, 2022 (compared to an unrealized gain of $2.4 million at December 31, 2021) coupled with a increase in loss of $654,000 in the defined benefit plan obligation. The current level of shareholders’ equity equates to a book value per share of $23.76 at December 31, 2022 compared to $24.37 at December 31, 2021, and an equity to asset ratio of 8.40% at December 31, 2022 and 8.88% at December 31, 2021. Dividends declared for the twelve months ended December 31, 2022 and 2021 were $1.28 per share.

    Penns Woods Bancorp, Inc. is the parent company of Jersey Shore State Bank, which operates seventeen branch offices providing financial services in Lycoming, Clinton, Centre, Montour, Union, and Blair Counties, and Luzerne Bank, which operates eight branch offices providing financial services in Luzerne County, and United Insurance Solutions, LLC, which offers insurance products.  Investment and insurance products are offered through Jersey Shore State Bank’s subsidiary, The M Group, Inc. D/B/A The Comprehensive Financial Group.

    NOTE:  This press release contains financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”).  Management uses the non-GAAP measure of net income from core operations in its analysis of the company’s performance. This measure, as used by the Company, adjusts net income determined in accordance with GAAP to exclude the effects of special items, including significant gains or losses that are unusual in nature such as net securities gains and losses. Because these certain items and their impact on the Company’s performance are difficult to predict, management believes presentation of financial measures excluding the impact of such items provides useful supplemental information in evaluating the operating results of the Company’s core businesses. These disclosures should not be viewed as a substitute for net income determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

    This press release may contain certain “forward-looking statements” including statements concerning plans, objectives, future events or performance and assumptions and other statements, which are statements other than statements of historical fact.  The Company cautions readers that the following important factors, among others, may have affected and could in the future affect actual results and could cause actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company herein: (i) the effect of changes in laws and regulations, including federal and state banking laws and regulations, and the associated costs of compliance with such laws and regulations either currently or in the future as applicable; (ii) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies as well as by the Financial Accounting Standards Board, or of changes in the Company’s organization, compensation and benefit plans; (iii) the effect on the Company’s competitive position within its market area of the increasing consolidation within the banking and financial services industries, including the increased competition from larger regional and out-of-state banking organizations as well as non-bank providers of various financial services; (iv) the effect of changes in interest rates; (v) the effects of health emergencies, including the spread of infectious diseases or pandemics; or (vi) the effect of changes in the business cycle and downturns in the local, regional or national economies.  For a list of other factors which could affect the Company’s results, see the Company’s filings with the Securities and Exchange Commission, including “Item 1A.  Risk Factors,” set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

    You should not place undue reliance on any forward-looking statements.  These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise.  The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

    Previous press releases and additional information can be obtained from the Company’s website at www.pwod.com.

    Contact:Richard A. Grafmyre, Chief Executive Officer
     110 Reynolds Street
     Williamsport, PA 17702
     570-322-1111e-mail: pwod@pwod.com

    PENNS WOODS BANCORP, INC.
    CONSOLIDATED BALANCE SHEET
    (UNAUDITED)

      December 31,
    (In Thousands, Except Share and Per Share Data) 2022
    		 2021
    		 % Change
    ASSETS:      
    Noninterest-bearing balances $27,390  $19,233  42.41%
    Interest-bearing balances in other financial institutions  12,943   194,629  (93.35)%
    Federal funds sold  —   50,000  (100.00)%
    Total cash and cash equivalents  40,333   263,862  (84.71)%
           
    Investment debt securities, available for sale, at fair value  193,673   166,410  16.38%
    Investment equity securities, at fair value  1,142   1,288  (11.34)%
    Restricted investment in bank stock, at fair value  19,171   14,531  31.93%
    Loans held for sale  3,298   3,725  (11.46)%
    Loans  1,639,731   1,392,147  17.78%
    Allowance for loan losses  (15,637)  (14,176) 10.31%
    Loans, net  1,624,094   1,377,971  17.86%
    Premises and equipment, net  31,844   34,025  (6.41)%
    Accrued interest receivable  9,481   8,048  17.81%
    Bank-owned life insurance  34,452   33,768  2.03%
    Investment in limited partnerships  4,783   4,607  3.82%
    Goodwill  16,450   17,104  (3.82)%
    Intangibles  327   480  (31.88)%
    Operating lease right of use asset  2,651   2,851  (7.02)%
    Deferred tax asset  6,868   2,946  133.13%
    Other assets  7,640   9,193  (16.89)%
    TOTAL ASSETS $1,996,207  $1,940,809  2.85%
           
    LIABILITIES:      
    Interest-bearing deposits $1,037,397  $1,126,955  (7.95)%
    Noninterest-bearing deposits  519,063   494,360  5.00%
    Total deposits  1,556,460   1,621,315  (4.00)%
           
    Short-term borrowings  153,349   5,747  2,568.33%
    Long-term borrowings  102,783   125,963  (18.40)%
    Accrued interest payable  603   651  (7.37)%
    Operating lease liability  2,708   2,898  (6.56)%
    Other liabilities  12,639   11,961  5.67%
    TOTAL LIABILITIES  1,828,542   1,768,535  3.39%
           
    SHAREHOLDERS’ EQUITY:      
    Preferred stock, no par value, 3,000,000 shares authorized; no shares issued  —   —  n/a 
    Common stock, par value $5.55, 22,500,000 shares authorized; 7,566,810 and 7,550,272 shares issued; 7,056,585 and 7,070,047 shares outstanding  42,039   41,945  0.22%
    Additional paid-in capital  54,252   53,795  0.85%
    Retained earnings  98,147   89,761  9.34%
    Accumulated other comprehensive (loss) gain:      
    Net unrealized (loss) gain on available for sale securities  (9,819)  2,373  (513.78)%
    Defined benefit plan  (4,139)  (3,485) (18.77)%
    Treasury stock at cost, 510,225 and 480,225  (12,815)  (12,115) 5.78%
    TOTAL SHAREHOLDERS' EQUITY  167,665   172,274  (2.68)%
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $1,996,207  $1,940,809  2.85%

       
    PENNS WOODS BANCORP, INC.
    CONSOLIDATED STATEMENT OF INCOME
    (UNAUDITED)

      Three Months Ended December 31, Twelve Months Ended December 31,
    (In Thousands, Except Share and Per Share Data) 2022
    		 2021
    		 % Change 2022
    		 2021
    		 % Change
    INTEREST AND DIVIDEND INCOME:            
    Loans including fees $16,973  $13,406  26.61% $58,682  $53,232  10.24%
    Investment securities:            
    Taxable  1,084   790  37.22%  3,634   3,281  10.76%
    Tax-exempt  229   160  43.13%  823   655  25.65%
    Dividend and other interest income  319   343  (7.00)%  1,789   1,246  43.58%
    TOTAL INTEREST AND DIVIDEND INCOME  18,605   14,699  26.57%  64,928   58,414  11.15%
                 
    INTEREST EXPENSE:            
    Deposits  1,499   1,064  40.88%  3,690   5,545  (33.45)%
    Short-term borrowings  978   2  n/m   1,007   9  n/m 
    Long-term borrowings  580   712  (18.54)%  2,451   3,142  (21.99)%
    TOTAL INTEREST EXPENSE  3,057   1,778  71.93%  7,148   8,696  (17.80)%
                 
    NET INTEREST INCOME  15,548   12,921  20.33%  57,780   49,718  16.22%
                 
    PROVISION (RECOVERY) FOR LOAN LOSSES  575   (300) 291.67%  1,910   640  198.44%
                 
    NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES  14,973   13,221  13.25%  55,870   49,078  13.84%
                 
    NON-INTEREST INCOME:            
    Service charges  540   485  11.34%  2,103   1,703  23.49%
    Debt securities (losses) gains, available for sale  (51)  376  (113.56)%  (219)  699  (131.33)%
    Net equity securities gains (losses}  12   (16) 175.00%  (146)  (40) (265.00)%
    Bank-owned life insurance  163   302  (46.03)%  664   916  (27.51)%
    Gain on sale of loans  226   440  (48.64)%. 1,131   2,474  (54.28)%
    Insurance commissions  105   117  (10.26)%  491   553  (11.21)%
    Brokerage commissions  120   188  (36.17)%  620   851  (27.14)%
    Loan broker income  324   715  (54.69)%  1,674   2,164  (22.64)%
    Debit card income  384   345  11.30%  1,464   1,511  (3.11)%
    Other  258   243  6.17%  931   838  11.10%
    TOTAL NON-INTEREST INCOME  2,081   3,195  (34.87)%  8,713   11,669  (25.33)%
                 
    NON-INTEREST EXPENSE:            
    Salaries and employee benefits  5,846   5,907  (1.03)%  24,267   23,014  5.44%
    Occupancy  700   771  (9.21)%  3,080   3,209  (4.02)%
    Furniture and equipment  834   859  (2.91)%  3,288   3,522  (6.64)%
    Software amortization  180   236  (23.73)%  840   868  (3.23)%
    Pennsylvania shares tax  333   253  31.62%  1,452   1,350  7.56%
    Professional fees  688   550  25.09%  2,434   2,432  0.08%
    Federal Deposit Insurance Corporation deposit insurance  248   258  (3.88)%  938   963  (2.60)%
    Marketing  255   111  129.73%  690   545  26.61%
    Intangible amortization  35   44  (20.45)%  154   191  (19.37)%
    Goodwill impairment  653   —  n/a   653   —  n/a 
    Other  1,479   1,270  16.46%  5,202   4,811  8.13%
    TOTAL NON-INTEREST EXPENSE  11,251   10,259  9.67%  42,998   40,905  5.12%
    INCOME BEFORE INCOME TAX PROVISION  5,803   6,157  (5.75)%  21,585   19,842  8.78%
    INCOME TAX PROVISION  1,294   1,278  1.25%  4,163   3,794  9.73%
    NET INCOME $4,509  $4,879  (7.58)% $17,422  $16,048  8.56%
    Earnings attributable to noncontrolling interest  —   —  —%  —   15  (100.00)%
    NET INCOME AVAILABLE TO COMMON SHAREHOLDERS' $4,509  $4,879  (7.58)% $17,422  $16,033  8.66%
    EARNINGS PER SHARE - BASIC $0.64  $0.69  (7.25)% $2.47  $2.27  8.81%
    EARNINGS PER SHARE - DILUTED $0.64  $0.69  (7.25)% $2.47  $2.27  8.81%
    WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC  7,055,181   7,068,327  (0.19)%  7,059,437   7,061,818  (0.03)%
    WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED  7,055,181   7,068,327  (0.19)%  7,059,437   7,061,818  (0.03)%

    PENNS WOODS BANCORP, INC.
    AVERAGE BALANCES AND INTEREST RATES 
    (UNAUDITED)

      Three Months Ended
      December 31, 2022 December 31, 2021
    (Dollars in Thousands) Average 
    Balance(1)    		 Interest Average 
    Rate    		 Average 
    Balance(1)    		 Interest Average 
    Rate
    ASSETS:            
    Tax-exempt loans (3) $61,756 $408 2.62% $46,583 $317 2.70%
    All other loans  1,546,338  16,651 4.27%  1,320,972  13,156 3.95%
    Total loans (2)  1,608,094  17,059 4.21%  1,367,555  13,473 3.91%
                 
    Federal funds sold  —  — —%  47,391  85 0.71%
                 
    Taxable securities  167,405  1,329 3.22%  148,434  978 2.67%
    Tax-exempt securities (3)  41,167  290 2.86%  38,043  202 2.15%
    Total securities  208,572  1,619 3.15%  186,477  1,180 2.57%
                 
    Interest-bearing deposits  5,797  74 5.06%  184,591  70 0.15%
                 
    Total interest-earning assets  1,822,463  18,752 4.09%  1,786,014  14,808 3.30%
                 
    Other assets  128,084      130,859    
                 
    TOTAL ASSETS $1,950,547     $1,916,873    
                 
    LIABILITIES AND SHAREHOLDERS’ EQUITY:            
    Savings $249,793  66 0.10% $233,791  22 0.04%
    Super Now deposits  385,060  623 0.64%  345,653  206 0.24%
    Money market deposits  268,519  509 0.75%  301,651  211 0.28%
    Time deposits  144,491  301 0.83%  218,260  625 1.14%
    Total interest-bearing deposits  1,047,863  1,499 0.57%  1,099,355  1,064 0.38%
                 
    Short-term borrowings  97,585  978 3.98%  7,255  2 0.11%
    Long-term borrowings  102,814  580 2.24%  125,991  712 2.25%
    Total borrowings  200,399  1,558 3.09%  133,246  714 2.13%
                 
    Total interest-bearing liabilities  1,248,262  3,057 0.97%  1,232,601  1,778 0.57%
                 
    Demand deposits  517,977      496,478    
    Other liabilities  19,151      19,463    
    Shareholders’ equity  165,157      168,331    
                 
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $1,950,547     $1,916,873    
    Interest rate spread (3)     3.12%     2.73%
    Net interest income/margin (3)   $15,695 3.42%   $13,030 2.90%
    1. Information on this table has been calculated using average daily balance sheets to obtain average balances.
    2. Non-accrual loans have been included with loans for the purpose of analyzing net interest earnings.
    3. Income and rates on fully taxable equivalent basis include an adjustment for the difference between annual income from tax-exempt obligations and the taxable equivalent of such income at the standard tax rate of 21%
     Three Months Ended December 31,
     2022 2021
    Total interest income$18,605 $14,699
    Total interest expense 3,057  1,778
    Net interest income (GAAP) 15,548  12,921
    Tax equivalent adjustment 147  109
    Net interest income (fully taxable equivalent) (non-GAAP)$15,695 $13,030

    PENNS WOODS BANCORP, INC.
    AVERAGE BALANCES AND INTEREST RATES 
    (UNAUDITED)

      Twelve Months Ended
      December 31, 2022 December 31, 2021
    (Dollars in Thousands) Average 
    Balance(1)    		 Interest Average 
    Rate    		 Average 
    Balance(1)    		 Interest Average 
    Rate
    ASSETS:            
    Tax-exempt loans (3) $55,364 $1,441 2.60% $46,312 $1,308 2.82%
    All other loans  1,439,550  57,544 4.00%  1,299,321  52,199 4.02%
    Total loans (2)  1,494,914  58,985 3.95%  1,345,633  53,507 3.98%
                 
    Federal funds sold  32,863  465 1.41%  28,395  202 0.71%
                 
    Taxable securities  156,584  4,455 2.88%  148,066  4,083 2.80%
    Tax-exempt securities (3)  44,301  1,042 2.38%  36,993  829 2.27%
    Total securities  200,885  5,497 2.77%  185,059  4,912 2.69%
                 
    Interest-bearing deposits  74,401  503 0.68%  201,273  242 0.12%
                 
    Total interest-earning assets  1,803,063  65,450 3.63%  1,760,360  58,863 3.35%
                 
    Other assets  128,213      129,582    
                 
    TOTAL ASSETS $1,931,276     $1,889,942    
                 
    LIABILITIES AND SHAREHOLDERS’ EQUITY:            
    Savings $247,003  138 0.06% $225,637  116 0.05%
    Super Now deposits  387,370  1,344 0.35%  307,446  900 0.29%
    Money market deposits  289,820  1,105 0.38%  305,883  972 0.32%
    Time deposits  161,982  1,103 0.68%  244,341  3,557 1.46%
    Total interest-bearing deposits  1,086,175  3,690 0.34%  1,083,307  5,545 0.51%
                 
    Short-term borrowings  29,315  1,007 3.44%  7,178  9 0.13%
    Long-term borrowings  110,027  2,451 2.23%  135,474  3,142 2.32%
    Total borrowings  139,342  3,458 2.48%  142,652  3,151 2.21%
                 
    Total interest-bearing liabilities  1,225,517  7,148 0.58%  1,225,959  8,696 0.71%
                 
    Demand deposits  519,189      478,984    
    Other liabilities  24,182      23,568    
    Shareholders’ equity  162,388      161,431    
                 
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $1,931,276     $1,889,942    
    Interest rate spread (3)     3.05%     2.64%
    Net interest income/margin (3)   $58,302 3.24%   $50,167 2.85%
    1. Information on this table has been calculated using average daily balance sheets to obtain average balances.
    2. Non-accrual loans have been included with loans for the purpose of analyzing net interest earnings.
    3. Income and rates on fully taxable equivalent basis include an adjustment for the difference between annual income from tax-exempt obligations and the taxable equivalent of such income at the standard tax rate of 21%
     Twelve Months Ended December 31,
     2022 2021
    Total interest income$64,928 $58,414
    Total interest expense 7,148  8,696
    Net interest income 57,780  49,718
    Tax equivalent adjustment 522  449
    Net interest income (fully taxable equivalent) (non-GAAP)$58,302 $50,167


    (Dollars in Thousands, Except Share and Per Share Data, Unaudited) Quarter Ended
      12/31/2022 9/30/2022 6/30/2022 3/31/2022 12/31/2021
    Operating Data          
    Net income $4,509  $5,250  $4,231  $3,432  $4,879 
    Net interest income  15,548   15,532   13,847   12,853   12,921 
    Provision (credit) for loan losses  575   855   330   150   (300)
    Net security (losses) gains  (39)  (211)  (54)  (61)  360 
    Non-interest income, excluding net security (losses) gains  2,120   2,294   2,191   2,473   2,835 
    Non-interest expense  11,251   10,320   10,420   11,007   10,259 
               
    Performance Statistics          
    Net interest margin  3.42%  3.47%  3.12%  2.93%  2.90%
    Annualized return on average assets  0.92%  1.09%  0.88%  0.72%  1.02%
    Annualized return on average equity  10.92%  12.61%  10.15%  8.17%  11.59%
    Annualized net loan charge-offs (recoveries) to average loans  0.04%  0.01%  (0.01)%  0.09%  0.02%
    Net charge-offs (recoveries)  149   37   (40)  303   81 
    Efficiency ratio  59.79%  57.70%  64.72%  71.53%  64.83%
               
    Per Share Data          
    Basic earnings per share $0.64  $0.74  $0.60  $0.49  $0.69 
    Diluted earnings per share  0.64   0.74   0.60   0.49   0.69 
    Dividend declared per share  0.32   0.32   0.32   0.32   0.32 
    Book value  23.76   23.32   23.56   23.81   24.37 
    Common stock price:          
    High  26.89   24.29   24.35   24.67   24.65 
    Low  23.15   22.02   22.34   23.64   23.50 
    Close  26.62   22.91   23.09   24.43   23.65 
    Weighted average common shares:          
    Basic  7,055   7,051   7,059   7,073   7,068 
    Fully Diluted  7,055   7,051   7,059   7,073   7,068 
    End-of-period common shares:          
    Issued  7,567   7,563   7,559   7,555   7,550 
    Treasury  (510)  (510)  (510)  (480)  (480)


    (Dollars in Thousands, Except Share and Per Share Data, Unaudited) Quarter Ended
      12/31/2022 9/30/2022 6/30/2022 3/31/2022 12/31/2021
    Financial Condition Data:          
    General          
    Total assets $1,996,207  $1,905,116  $1,891,806  $1,916,809  $1,940,809 
    Loans, net  1,624,094   1,545,489   1,474,739   1,391,943   1,377,971 
    Goodwill  16,450   17,104   17,104   17,104   17,104 
    Intangibles  327   361   396   437   480 
    Total deposits  1,556,460   1,590,415   1,589,579   1,612,395   1,621,315 
    Noninterest-bearing  519,063   537,403   524,288   514,130   494,360 
    Savings  247,952   249,532   249,057   245,661   236,312 
    NOW  372,574   392,140   353,102   379,838   366,399 
    Money Market  270,589   268,532   309,453   299,166   318,877 
    Time Deposits  146,282   142,808   153,679   173,600   205,367 
    Total interest-bearing deposits  1,037,397   1,053,012   1,065,291   1,098,265   1,126,955 
               
    Core deposits*  1,410,178   1,447,607   1,435,900   1,438,795   1,415,948 
    Shareholders’ equity  167,665   164,489   166,054   168,427   172,274 
               
    Asset Quality          
    Non-performing loans $4,890  $5,743  $5,100  $5,281  $6,250 
    Non-performing loans to total assets  0.24%  0.30%  0.27%  0.28%  0.32%
    Allowance for loan losses  15,637   15,211   14,393   14,023   14,176 
    Allowance for loan losses to total loans  0.95%  0.97%  0.97%  1.00%  1.02%
    Allowance for loan losses to non-performing loans  319.78%  264.86%  282.22%  265.54%  226.82%
    Non-performing loans to total loans  0.30%  0.37%  0.34%  0.38%  0.45%
               
    Capitalization          
    Shareholders’ equity to total assets  8.40%  8.63%  8.78%  8.79%  8.88%

    * Core deposits are defined as total deposits less time deposits

    Reconciliation of GAAP and Non-GAAP Financial Measures
    (UNAUDITED)

      Three Months Ended December 31, Twelve Months Ended December 31,
    (Dollars in Thousands, Except Per Share Data) 2022
    		 2021
    		 2022
    		 2021
    GAAP net income $4,509  $4,879  $17,422  $16,033 
    Net securities losses (gains), net of tax  31   (284)  288   (521)
    Goodwill impairment  516   —   516   — 
    Non-GAAP core earnings $5,056  $4,595  $18,226  $15,512 
             
      Three Months Ended December 31, Twelve Months Ended December 31,
      2022
    		 2021
    		 2022
    		 2021
    Return on average assets (ROA)  0.92%  1.02%  0.90%  0.85%
    Net securities losses (gains), net of tax  0.01%  (0.06)%  0.01%  (0.03)%
    Goodwill impairment  0.11%  —%  0.03%  —%
    Non-GAAP core ROA  1.04%  0.96%  0.94%  0.82%
             
      Three Months Ended December 31, Twelve Months Ended December 31,
      2022
    		 2021
    		 2022
    		 2021
    Return on average equity (ROE)  10.92%  11.59%  10.73%  9.93%
    Net securities losses (gains), net of tax  0.08%  (0.67)%  0.17%  (0.32)%
    Goodwill impairment  1.25%  —%  0.32%  —%
    Non-GAAP core ROE  12.25%  10.92%  11.22%  9.61%
             
      Three Months Ended December 31, Twelve Months Ended December 31,
      2022
    		 2021
    		 2022
    		 2021
    Basic earnings per share (EPS) $0.64  $0.69  $2.47  $2.27 
    Net securities losses (gains), net of tax  —   (0.04)  0.04   (0.07)
    Goodwill impairment  0.07   —   0.07   — 
    Non-GAAP basic core EPS $0.71  $0.65  $2.58  $2.20 
         
      Three Months Ended December 31, Twelve Months Ended December 31,
      2022
    		 2021
    		 2022
    		 2021
    Diluted EPS $0.64  $0.69  $2.47  $2.27 
    Net securities losses (gains), net of tax  —   (0.04)  0.04   (0.07)
    Goodwill impairment  0.07   —   0.07   — 
    Non-GAAP diluted core EPS $0.71  $0.65  $2.58  $2.20 

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