PSB Holdings, Inc. Reports First Quarter 2022 Earnings Increase of 5.8% Over Prior Quarter, to $3.3 Million, or $0.75 Per Share
WAUSAU, Wis., April 25, 2022 (GLOBE NEWSWIRE) — PSB Holdings, Inc. (“PSB”) (OTCQX: PSBQ), the holding company for Peoples State Bank (“Peoples”) serving Northcentral and Southeastern Wisconsin reported first quarter earnings ending March 31, 2022 of $0.75 per share on net income of $3.3 million, compared to earnings of $0.71 per share on net income of $3.1 million during the fourth quarter ending December 31, 2021, and $0.87 per share on net income of $3.9 million during the first quarter ending March 31, 2021.
The Company’s first quarter 2022 operating results reflected the following changes from the fourth quarter of 2021: (1) higher net interest income due to higher yields on loans and investment securities; (2) lower salary and employee benefit expenses due to lower performance-based incentive payouts; and (3) lower noninterest income primarily due to lower gains on the sale of mortgage loans. Prior year March 2021 quarterly earnings were elevated by recognition of SBA PPP lending program origination fees which increased net income by $227,000, $208,000, and $1,128,000 in the March 2022, December 2021, and March 2021 quarters, respectively.
“We are beginning to see the impact of the pandemic on our operations fade as the stimulus provided through PPP lending is largely repaid, further deposit growth supported by PPP loan deposits and government checks are no longer being received, and higher long-term interest rates have suppressed mortgage loan refinance activity. We believe we have successfully managed our way through the difficult period and delivered returns on tangible equity of 12.8%, 10.9% and 12.0% for fiscal years 2019, 2020 and 2021. As we enter an environment with rising interest rates and elevated inflation, we believe we have positioned the Bank to continue to deliver above average returns as seen with the current quarter’s return on tangible equity of 12.9%,” stated Scott Cattanach, President and CEO.
March 31, 2022 Highlights:
- Net interest income increased to $9.6 million for the quarter ended March 31, 2022, compared to $9.2 million for the quarter ended December 31, 2021, and equal to the $9.6 million for the quarter ended March 31, 2021. The most recent quarter reflected slightly higher PPP related fee income of $313,000 compared to $287,000 for the quarter ended December 31, 2021, and $1.55 million for the quarter ended March 31, 2021.
- As was the case for the quarter ended December 31, 2021, loan loss provisions remained at zero for the quarter ended March 31, 2022, compared to $1.0 million for the quarter ended March 31, 2021.
- Noninterest expense decreased $165,000 for the first quarter of 2022, to $7.2 million from $7.4 million the prior quarter. The decrease primarily related to decreased salary and benefit costs associated with lower incentive compensation plan expense.
- Loans receivable remained at $876 million at March 31, 2022, despite a $11.6 million decline in PPP related loans during the most recent quarter, with $3.2 million of PPP related loans remaining at March 31, 2022.
- Tangible book value declined to $21.82 per share at March 31, 2022, due primarily to the recording of unrealized losses on the securities portfolio which were impacted by actions taken by the Federal Reserve to increase short-term interest rates and market expectations of future rate increases.
As shown in the table below during the first quarter of 2022, “impaired loans” decreased $9.3 million. The primary decrease in “impaired loans” relates to improvements seen in several large loans that resulted in the risk rating on these loans being upgraded.
| Commercial, Commercial Real Estate, Construction & Development, Agricultural and Government Loans ($000s) | |||||||||||||
| Risk Rating | 12/2020 | 03/2021 | 06/2021 | 09/2021 | 12/2021 | 03/2022 | |||||||
| Rating 1 | “High Quality” | $ | – | $ | – | $ | – | $ | 77 | $ | – | $ | 55 |
| Rating 2 | “Minimal Risk” | 61,223 | 62,626 | 60,155 | 71,304 | 70,886 | 85,074 | ||||||
| Rating 3 | “Average Risk” | 390,191 | 348,102 | 345,929 | 347,735 | 383,951 | 379,966 | ||||||
| Rating 4 | “Acceptable Risk” | 175,400 | 209,407 | 209,728 | 226,501 | 222,641 | 227,759 | ||||||
| Rating 5 | “Watch Risk” | 36,379 | 30,891 | 39,577 | 33,284 | 37,194 | 37,063 | ||||||
| Rating 6 | “Substandard Risk” | 7,617 | 18,134 | 6,377 | 10,148 | 4,182 | 4,135 | ||||||
| Rating 7 | “Impaired Loans” | 13,153 | 16,162 | 15,522 | 16,790 | 21,322 | 12,061 | ||||||
| Totals | $ | 683,963 | $ | 685,322 | $ | 677,288 | $ | 705,839 | $ | 740,176 | $ | 746,113 | |
| Includes undisbursed Construction & Development lines of credit. PPP loan balances are assigned a risk-weighting of “3”. | |||||||||||||
Balance Sheet and Asset Quality Review
Total assets declined slightly to $1.27 billion at March 31, 2022, from $1.3 billion at December 31, 2021. Cash and cash equivalents have continued to trend down, post-acquisition of Waukesha Bankshares, Inc. in April 2021, declining $15.7 million to $37.8 million from $53.5 million one quarter earlier. Similarly, securities available for sale decreased $19.0 million to $289.7 million at March 31, 2022, from $308.7 million one quarter earlier. The decreased balance of investment securities largely reflects their lower fair value in today’s rising rate market.
Total loans receivable decreased slightly to $875.6 million at March 31, 2022, from $876.4 million at December 31, 2021. PPP loans declined from $14.8 million at December 31, 2021, to $3.2 million at March 31, 2022, while non-PPP loans increased from $861.6 million at December 31, 2021, to $872.4 million at March 31, 2022.
The allowance for loan losses increased to 1.39% of gross loans at March 31, 2022, from 1.38% the prior quarter and decreased from 1.40% of gross loans one year earlier. Annualized net charge-offs to average loans reflected a net recovery at 0.05% for the quarter ended March 31, 2022. Non-performing assets were 1.03% of total assets at March 31, 2022, compared to 1.06% at December 31, 2021, and 1.13% at March 31, 2021. At March 31, 2022, non-performing assets consisted of $6.5 million in non-accrual loans, $170,000 in non-accrual restructured loans, $5.2 million in restructured loans not on non-accrual and $1.1 million in foreclosed assets.
Total deposits decreased $15.8 million to $1.09 billion at March 31, 2022, compared to $1.11 billion at December 31, 2021, led by commercial related and seasonal municipal customer withdrawals. At March 31, 2022, interest-bearing demand and savings deposits accounted for 35.1% of total deposits, followed by noninterest-bearing demand deposits at 25.0%, money market deposits at 20.4%, and retail and local time deposits at 15.4%. Broker and national time deposits accounted for 4.1% of total deposits at March 31, 2022, versus 1.7% at December 31, 2021.
FHLB advances remained at $47.0 million at March 31, 2022, while other borrowings decreased $2.4 million to $4.3 million compared to $6.7 million the prior period and $18.6 million at March 31, 2021.
Operations Review
Net interest income increased to $9.6 million (on a net margin of 3.24%) for the first quarter of 2022, compared to $9.2 million (on a net margin of 3.01%) for the fourth quarter of 2021, and $9.6 million (on a net margin of 3.62%) for the first quarter of 2021. Earning asset yields increased 23 basis points to 3.51% during the first quarter of 2022, from 3.28% during the fourth quarter of 2021, while deposit and borrowing costs decreased 2 basis points on a smaller average balance to 0.37% from 0.39% over the same period. The increase in earning asset yields was due to higher yields on both loans and investment securities during the quarter ended March 31, 2022. Loan yields improved to 4.12% for the first quarter of 2022, from 4.02% for the fourth quarter of 2021. Taxable security yields increased to 1.42% for the quarter ended March 31, 2022, from 1.17% in the quarter ended December 31, 2021.
The cost of interest-bearing liabilities decreased during the quarter, largely reflecting the decline in the cost of time deposits. The overall cost of deposits was 0.16% for the quarter ended March 31, 2022, compared to 0.17% the prior quarter. Along with a further increase in asset yields, cost of deposits is expected to increase during 2022 as market interest rates move higher.
Total noninterest income decreased for the first quarter of 2022 to $2.0 million from $2.2 million for the fourth quarter of 2021, due primarily to a decrease from gains on sale of mortgage loans. While mortgage loan originations have been negatively influenced by the rise in interest rates with less mortgage refinancing activities, mortgage loan servicing income has increased due in part to greater aggregate income association with the longer than previously expected servicing life. At March 31, 2022, the bank was servicing $393 million in secondary market mortgage loans for others.
Noninterest expense decreased to $7.2 million for the first quarter of 2022, compared to $7.4 million for the fourth quarter of 2021. The fourth quarter of 2021 included increased salaries and employee benefit expenses related to severance expense and higher 2021 calendar year performance-based incentive expenses. Salary and employee benefit expenses were $4.4 million for the first quarter of 2022, compared to $4.7 million for the fourth quarter of 2021.
About PSB Holdings, Inc.
PSB Holdings, Inc. is the parent company of Peoples State Bank. Peoples is a community bank headquartered in Wausau, Wisconsin, serving northcentral and southeastern Wisconsin from ten full-service banking locations in Marathon, Oneida, Vilas, Milwaukee and Waukesha counties and a loan production office in Stevens Point, Wisconsin. Peoples also provides investment and insurance products, along with retirement planning services, through Peoples Wealth Management, a division of Peoples. PSB Holdings, Inc. is traded under the stock symbol PSBQ on the OTCQX Market. More information about PSB, its management, and its financial performance may be found at www.psbholdingsinc.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current expectations, estimates and projections about PSB’s business based, in part, on assumptions made by management and include, without limitation, statements with respect to the potential growth of PSB, its future profits, expected stock repurchase levels, future dividend rates, future interest rates, and the adequacy of its capital position. Forward-looking statements can be affected by known and unknown risks, uncertainties, and other factors, including, but not limited to, strength of the economy, the effects of government policies, including interest rate policies, risks associated with the execution of PSB’s vision and growth strategy, including with respect to current and future M&A activity, and risks associated with global economic instability relating to the COVID-19 pandemic and its effect on PSB and Peoples, and their customers, and other risks. The forward-looking statements in this press release speak only as of the date on which they are made and PSB does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
| PSB Holdings, Inc. | ||||||||||||||||
| Consolidated Balance Sheets | ||||||||||||||||
| March 31, 2022, September 30, June 30, and March 31, 2021, unaudited, December 31, 2021 derived from audited financial statements | ||||||||||||||||
| Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | ||||||||||||
| (dollars in thousands, except per share data) | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||
| Assets | ||||||||||||||||
| Cash and due from banks | $ | 18,322 | $ | 16,896 | $ | 20,813 | $ | 18,589 | $ | 12,921 | ||||||
| Interest-bearing deposits | 5,158 | 6,579 | 1,044 | 906 | 985 | |||||||||||
| Federal funds sold | 14,356 | 30,068 | 43,637 | 52,643 | 16,027 | |||||||||||
| Cash and cash equivalents | 37,836 | 53,543 | 65,494 | 72,138 | 29,933 | |||||||||||
| Securities available for sale (at fair value) | 289,704 | 308,744 | 300,192 | 260,062 | 226,239 | |||||||||||
| Equity securities | 1,720 | 1,701 | 1,661 | 1,623 | 1,585 | |||||||||||
| Bank certificates of deposit (at cost) | 245 | 245 | 245 | 245 | 1,231 | |||||||||||
| Loans held for sale | – | 3,061 | 214 | 1,756 | 622 | |||||||||||
| Loans receivable, net | 875,588 | 876,337 | 874,524 | 863,254 | 829,964 | |||||||||||
| Accrued interest receivable | 3,219 | 3,256 | 3,273 | 3,299 | 3,335 | |||||||||||
| Foreclosed assets | 1,103 | 1,103 | 2,398 | 1,984 | 1,105 | |||||||||||
| Premises and equipment, net | 12,906 | 12,695 | 12,725 | 13,241 | 11,077 | |||||||||||
| Mortgage servicing rights, net | 1,770 | 1,714 | 1,702 | 1,696 | 1,732 | |||||||||||
| Federal Home Loan Bank stock (at cost) | 2,646 | 2,646 | 2,646 | 2,646 | 2,283 | |||||||||||
| Cash surrender value of bank-owned life insurance | 24,455 | 24,305 | 24,154 | 24,001 | 17,902 | |||||||||||
| Core deposit intangible | 487 | 534 | 581 | 629 | – | |||||||||||
| Goodwill | 2,541 | 2,541 | 2,541 | 2,541 | 113 | |||||||||||
| Other assets | 11,725 | 6,286 | 5,313 | 5,523 | 5,102 | |||||||||||
| TOTAL ASSETS | $ | 1,265,945 | $ | 1,298,711 | $ | 1,297,663 | $ | 1,254,638 | $ | 1,132,223 | ||||||
| Liabilities | ||||||||||||||||
| Non-interest-bearing deposits | $ | 272,611 | $ | 284,477 | $ | 291,440 | $ | 273,181 | $ | 242,974 | ||||||
| Interest-bearing deposits | 816,794 | 820,763 | 791,601 | 758,445 | 682,877 | |||||||||||
| Total deposits | 1,089,405 | 1,105,240 | 1,083,041 | 1,031,626 | 925,851 | |||||||||||
| Federal Home Loan Bank advances | 47,000 | 47,000 | 62,000 | 67,000 | 62,000 | |||||||||||
| Other borrowings | 4,304 | 6,677 | 17,129 | 21,757 | 18,582 | |||||||||||
| Senior subordinated notes | 2,500 | 2,500 | 2,500 | 2,500 | 2,500 | |||||||||||
| Junior subordinated debentures | 12,742 | 12,717 | 12,691 | 12,666 | 7,732 | |||||||||||
| Accrued expenses and other liabilities | 10,208 | 13,315 | 10,143 | 11,103 | 9,918 | |||||||||||
| Total liabilities | 1,166,159 | 1,187,449 | 1,187,504 | 1,146,652 | 1,026,583 | |||||||||||
| Stockholders’ equity | ||||||||||||||||
| Preferred stock – no par value: | ||||||||||||||||
| Authorized – 30,000 shares; no shares issued or outstanding | – | – | – | – | – | |||||||||||
| Common stock – no par value with a stated value of $1.00 per share: | ||||||||||||||||
| Authorized – 6,000,000 shares; Issued – 5,490,798 shares Outstanding – 4,434,840, 4,440,329, 4,447,026, 4,454,922 and 4,454,922 shares, respectively | 1,830 | 1,830 | 1,830 | 1,830 | 1,830 | |||||||||||
| Additional paid-in capital | 8,183 | 8,059 | 8,003 | 7,946 | 7,890 | |||||||||||
| Retained earnings | 117,957 | 114,627 | 112,502 | 108,863 | 107,751 | |||||||||||
| Accumulated other comprehensive income (loss), net of tax | (14,097 | ) | 628 | 1,530 | 2,869 | 1,691 | ||||||||||
| Treasury stock, at cost – 1,055,958, 1,050,469, 1,043,772, 1,035,876 and 1,035,876 shares, respectively | (14,087 | ) | (13,882 | ) | (13,706 | ) | (13,522 | ) | (13,522 | ) | ||||||
| Total stockholders’ equity | 99,786 | 111,262 | 110,159 | 107,986 | 105,640 | |||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,265,945 | $ | 1,298,711 | $ | 1,297,663 | $ | 1,254,638 | $ | 1,132,223 | ||||||
| PSB Holdings, Inc. | ||||||||||||||||
| Consolidated Statements of Income | ||||||||||||||||
| Quarter Ended | ||||||||||||||||
| (dollars in thousands, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | |||||||||||
| except per share data – unaudited) | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||
| Interest and dividend income: | ||||||||||||||||
| Loans, including fees | $ | 9,054 | $ | 8,918 | $ | 9,323 | $ | 9,972 | $ | 9,442 | ||||||
| Securities: | ||||||||||||||||
| Taxable | 762 | 631 | 581 | 553 | 507 | |||||||||||
| Tax-exempt | 533 | 505 | 500 | 505 | 502 | |||||||||||
| Other interest and dividends | 42 | 31 | 45 | 40 | 31 | |||||||||||
| Total interest and dividend income | 10,391 | 10,085 | 10,449 | 11,070 | 10,482 | |||||||||||
| Interest expense: | ||||||||||||||||
| Deposits | 443 | 476 | 404 | 485 | 547 | |||||||||||
| FHLB advances | 169 | 192 | 220 | 221 | 215 | |||||||||||
| Other borrowings | 2 | 4 | 9 | 8 | 7 | |||||||||||
| Senior subordinated notes | 28 | 29 | 28 | 28 | 28 | |||||||||||
| Junior subordinated debentures | 166 | 165 | 165 | 165 | 89 | |||||||||||
| Total interest expense | 808 | 866 | 826 | 907 | 886 | |||||||||||
| Net interest income | 9,583 | 9,219 | 9,623 | 10,163 | 9,596 | |||||||||||
| Provision for loan losses | – | – | – | – | 1,000 | |||||||||||
| Net interest income after provision for loan losses | 9,583 | 9,219 | 9,623 | 10,163 | 8,596 | |||||||||||
| Noninterest income: | ||||||||||||||||
| Service fees | 388 | 382 | 379 | 347 | 332 | |||||||||||
| Gain on sale of mortgage loans | 277 | 451 | 494 | 663 | 1,152 | |||||||||||
| Mortgage loan servicing, net | 176 | 114 | 111 | 9 | 79 | |||||||||||
| Investment and insurance sales commissions | 456 | 500 | 426 | 465 | 595 | |||||||||||
| Net gain on sale of securities | – | – | – | 113 | 21 | |||||||||||
| Increase in cash surrender value of life insurance | 150 | 151 | 153 | 148 | 108 | |||||||||||
| Other noninterest income | 531 | 646 | 563 | 554 | 462 | |||||||||||
| Total noninterest income | 1,978 | 2,244 | 2,126 | 2,299 | 2,749 | |||||||||||
| Noninterest expense: | ||||||||||||||||
| Salaries and employee benefits | 4,390 | 4,669 | 4,099 | 3,915 | 3,460 | |||||||||||
| Occupancy and facilities | 665 | 596 | 614 | 647 | 569 | |||||||||||
| Loss (gain) on foreclosed assets | (6 | ) | (347 | ) | 28 | 23 | 130 | |||||||||
| Data processing and other office operations | 861 | 855 | 828 | 1,499 | 694 | |||||||||||
| Advertising and promotion | 152 | 155 | 199 | 322 | 79 | |||||||||||
| Core deposit intangible amortization | 47 | 47 | 47 | 31 | 2 | |||||||||||
| Other noninterest expenses | 1,083 | 1,382 | 1,131 | 3,170 | 1,266 | |||||||||||
| Total noninterest expense | 7,192 | 7,357 | 6,946 | 9,607 | 6,200 | |||||||||||
| Income before provision for income taxes | 4,369 | 4,106 | 4,803 | 2,855 | 5,145 | |||||||||||
| Provision for income taxes | 1,039 | 960 | 1,165 | 718 | 1,249 | |||||||||||
| Net income | $ | 3,330 | $ | 3,146 | $ | 3,638 | $ | 2,137 | $ | 3,896 | ||||||
| Basic earnings per share | $ | 0.75 | $ | 0.71 | $ | 0.82 | $ | 0.48 | $ | 0.88 | ||||||
| Diluted earnings per share | $ | 0.75 | $ | 0.71 | $ | 0.82 | $ | 0.48 | $ | 0.87 | ||||||
| PSB Holdings, Inc. | ||||||||||||||||
| Quarterly Financial Summary | ||||||||||||||||
| (dollars in thousands, except per share data) | Quarter ended | |||||||||||||||
| Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | ||||||||||||
| Earnings and dividends: | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||
| Interest income | $ | 10,391 | $ | 10,085 | $ | 10,449 | $ | 11,070 | $ | 10,482 | ||||||
| Interest expense | $ | 808 | $ | 866 | $ | 826 | $ | 907 | $ | 886 | ||||||
| Net interest income | $ | 9,583 | $ | 9,219 | $ | 9,623 | $ | 10,163 | $ | 9,596 | ||||||
| Provision for loan losses | $ | – | $ | – | $ | – | $ | – | $ | 1,000 | ||||||
| Other noninterest income | $ | 1,978 | $ | 2,244 | $ | 2,126 | $ | 2,299 | $ | 2,749 | ||||||
| Other noninterest expense | $ | 7,192 | $ | 7,357 | $ | 6,946 | $ | 9,607 | $ | 6,200 | ||||||
| Net income | $ | 3,330 | $ | 3,146 | $ | 3,638 | $ | 2,137 | $ | 3,896 | ||||||
| Basic earnings per share (3) | $ | 0.75 | $ | 0.71 | $ | 0.82 | $ | 0.48 | $ | 0.88 | ||||||
| Diluted earnings per share (3) | $ | 0.75 | $ | 0.71 | $ | 0.82 | $ | 0.48 | $ | 0.87 | ||||||
| Dividends declared per share (3) | $ | – | $ | 0.23 | $ | – | $ | 0.23 | $ | – | ||||||
| Tangible net book value per share (4) | $ | 21.82 | $ | 24.36 | $ | 24.07 | $ | 23.53 | $ | 23.69 | ||||||
| Semi-annual dividend payout ratio | n/a | 15.05 | % | n/a | 17.04 | % | n/a | |||||||||
| Average common shares outstanding | 4,433,375 | 4,445,465 | 4,450,755 | 4,454,922 | 4,454,334 | |||||||||||
| Balance sheet – average balances: | ||||||||||||||||
| Loans receivable, net of allowances for loss | $ | 878,979 | $ | 870,151 | $ | 862,555 | $ | 891,886 | $ | 827,595 | ||||||
| Assets | $ | 1,278,565 | $ | 1,295,780 | $ | 1,292,369 | $ | 1,251,738 | $ | 1,132,905 | ||||||
| Deposits | $ | 1,084,814 | $ | 1,092,872 | $ | 1,064,553 | $ | 1,023,229 | $ | 925,689 | ||||||
| Stockholders’ equity | $ | 108,803 | $ | 112,089 | $ | 110,388 | $ | 105,932 | $ | 105,868 | ||||||
| Performance ratios: | ||||||||||||||||
| Return on average assets (1) | 1.06 | % | 0.96 | % | 1.12 | % | 0.68 | % | 1.39 | % | ||||||
| Return on average stockholders’ equity (1) | 12.41 | % | 11.14 | % | 13.08 | % | 8.09 | % | 14.92 | % | ||||||
| Return on average tangible stockholders’ equity (1)(4) | 12.90 | % | 11.58 | % | 13.59 | % | 8.39 | % | 14.95 | % | ||||||
| Average stockholders’ equity less accumulated other comprehensive income (loss) to average assets | 8.99 | % | 8.57 | % | 8.39 | % | 8.27 | % | 9.10 | % | ||||||
| Net loan charge-offs to average loans (1) | -0.05 | % | -0.10 | % | -0.08 | % | 0.00 | % | 0.01 | % | ||||||
| Nonperforming loans to gross loans | 1.34 | % | 1.42 | % | 1.43 | % | 1.31 | % | 1.39 | % | ||||||
| Nonperforming assets to total assets | 1.03 | % | 1.06 | % | 1.16 | % | 1.07 | % | 1.13 | % | ||||||
| Allowance for loan losses to gross loans | 1.39 | % | 1.38 | % | 1.35 | % | 1.35 | % | 1.40 | % | ||||||
| Nonperforming assets to tangible equity plus the allowance for loan losses (4) | 12.10 | % | 11.58 | % | 12.87 | % | 11.71 | % | 11.06 | % | ||||||
| Net interest rate margin (1)(2) | 3.24 | % | 3.01 | % | 3.15 | % | 3.48 | % | 3.62 | % | ||||||
| Net interest rate spread (1)(2) | 3.14 | % | 2.89 | % | 3.04 | % | 3.37 | % | 3.49 | % | ||||||
| Service fee revenue as a percent of average demand deposits (1) | 0.58 | % | 0.52 | % | 0.53 | % | 0.51 | % | 0.57 | % | ||||||
| Noninterest income as a percent of gross revenue | 15.99 | % | 18.20 | % | 16.91 | % | 17.20 | % | 20.78 | % | ||||||
| Efficiency ratio (2) | 61.40 | % | 63.37 | % | 58.40 | % | 76.20 | % | 49.64 | % | ||||||
| Noninterest expenses to average assets (1) | 2.28 | % | 2.25 | % | 2.13 | % | 3.08 | % | 2.22 | % | ||||||
| Tangible equity to tangible assets | 7.66 | % | 8.35 | % | 8.27 | % | 8.38 | % | 9.32 | % | ||||||
| Stock price information: | ||||||||||||||||
| High | $ | 26.45 | $ | 27.00 | $ | 26.50 | $ | 26.50 | $ | 25.94 | ||||||
| Low | $ | 25.80 | $ | 24.60 | $ | 24.52 | $ | 25.00 | $ | 20.45 | ||||||
| Last trade value at quarter-end | $ | 26.00 | $ | 26.05 | $ | 24.95 | $ | 26.25 | $ | 25.25 | ||||||
| (1) Annualized | ||||||||||||||||
| (2) The yield on tax-exempt loans and securities is computed on a tax-equivalent basis using a federal tax rate of 21%. | ||||||||||||||||
| (3) Due to rounding, cumulative quarterly per share performance may not equal annual per share totals. | ||||||||||||||||
| (4) Tangible stockholders’ equity excludes intangible assets. | ||||||||||||||||
| PSB Holdings, Inc. | ||||||||||||||||
| Consolidated Statements of Comprehensive Income | ||||||||||||||||
| Quarter Ended | ||||||||||||||||
| Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | ||||||||||||
| (dollars in thousands – unaudited) | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||
| Net income | $ | 3,330 | $ | 3,146 | $ | 3,638 | $ | 2,137 | $ | 3,896 | ||||||
| Other comprehensive income, net of tax: | ||||||||||||||||
| Unrealized gain (loss) on securities available for sale | (14,847 | ) | (973 | ) | (1,374 | ) | 1,224 | (2,803 | ) | |||||||
| Reclassification adjustment for security gain included in net income | – | – | – | (83 | ) | (15 | ) | |||||||||
| Unrealized gain (loss) on interest rate swap | 85 | 31 | (5 | ) | (4 | ) | 13 | |||||||||
| Reclassification adjustment of interest rate swap settlements included in earnings | 37 | 40 | 40 | 39 | 38 | |||||||||||
| Other comprehensive income (loss) | (14,725 | ) | (902 | ) | (1,339 | ) | 1,176 | (2,767 | ) | |||||||
| Comprehensive income (loss) | $ | (11,395 | ) | $ | 2,244 | $ | 2,299 | $ | 3,313 | $ | 1,129 | |||||
| PSB Holdings, Inc. | ||||||||||||||||
| Nonperforming Assets as of: | ||||||||||||||||
| Mar 31, | Dec 31, | Sep 30, | Jun 30, | Mar 31, | ||||||||||||
| (dollars in thousands) | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||
| Nonaccrual loans (excluding restructured loans) | $ | 6,537 | $ | 6,425 | $ | 6,018 | $ | 5,208 | $ | 5,346 | ||||||
| Nonaccrual restructured loans | 170 | 1,000 | 1,526 | 1,062 | 1,090 | |||||||||||
| Restructured loans not on nonaccrual | 5,172 | 5,213 | 5,159 | 5,205 | 5,242 | |||||||||||
| Accruing loans past due 90 days or more | – | – | – | – | – | |||||||||||
| Total nonperforming loans | 11,879 | 12,638 | 12,703 | 11,475 | 11,678 | |||||||||||
| Other real estate owned | 1,103 | 1,103 | 2,398 | 1,984 | 1,105 | |||||||||||
| Total nonperforming assets | $ | 12,982 | $ | 13,741 | $ | 15,101 | $ | 13,459 | $ | 12,783 | ||||||
| Nonperforming loans as a % of gross loans receivable | 1.34 | % | 1.42 | % | 1.43 | % | 1.31 | % | 1.39 | % | ||||||
| Total nonperforming assets as a % of total assets | 1.03 | % | 1.06 | % | 1.16 | % | 1.07 | % | 1.13 | % | ||||||
| Allowance for loan losses as a % of nonperforming loans | 103.89 | % | 96.71 | % | 94.51 | % | 103.06 | % | 101.23 | % | ||||||
| PSB Holdings, Inc. | ||||||||
| Nonperforming Assets >= $500,000 net book value before specific reserves | ||||||||
| At March 31, 2022 | ||||||||
| (dollars in thousands) | ||||||||
| Gross | Specific | |||||||
| Collateral Description | Asset Type | Principal | Reserves | |||||
| Real estate – Hotel | Restructured | $ | 4,706 | $ | 38 | |||
| Real estate – Buffet Style Restaurant | Nonaccrual | 3,134 | 1,393 | |||||
| Real estate – Independent Auto Repair | Nonaccrual | 905 | 136 | |||||
| Total listed nonperforming assets | $ | 8,745 | $ | 1,567 | ||||
| Total bank wide nonperforming assets | $ | 12,982 | $ | 1,870 | ||||
| Listed assets as a % of total nonperforming assets | 67 | % | 84 | % | ||||
| PSB Holding, Inc. | ||||||||||||||||
| Loan Composition by Purpose | ||||||||||||||||
| Quarter-ended (dollars in thousands) | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||||||
| Residential real estate: | ||||||||||||||||
| One to four family | $ | 168,083 | $ | 168,584 | $ | 166,728 | $ | 169,456 | $ | 136,242 | ||||||
| HELOC loans | 16,709 | 17,198 | 18,011 | 18,263 | 16,908 | |||||||||||
| Residential construction & development | 21,590 | 23,093 | 25,162 | 24,385 | 25,628 | |||||||||||
| Residential vacant land | 1,697 | 1,763 | 6,629 | 2,172 | 2,524 | |||||||||||
| Total Residential real estate | 208,079 | 210,638 | 216,530 | 214,276 | 181,302 | |||||||||||
| Commercial/Agricultural real estate: | ||||||||||||||||
| Owner occupied | ||||||||||||||||
| Commercial real estate | 208,271 | 202,416 | 203,509 | 202,767 | 194,514 | |||||||||||
| SBA commercial real estate | 2,530 | 1,568 | 1,140 | 1,164 | 1,445 | |||||||||||
| Agriculture real estate | 3,651 | 3,716 | 4,046 | 4,188 | 4,787 | |||||||||||
| Construction and land development | 26,111 | 22,380 | 17,705 | 6,460 | 4,121 | |||||||||||
| Commercial vacant land | 5,194 | 3,529 | 3,572 | 6,490 | 2,998 | |||||||||||
| Total Owner occupied | 245,757 | 233,609 | 229,972 | 221,069 | 207,865 | |||||||||||
| Non-owner occupied | ||||||||||||||||
| Commercial real estate | 212,407 | 211,688 | 212,868 | 196,011 | 183,365 | |||||||||||
| One to four family residential rental | 56,305 | 52,437 | 49,542 | 47,097 | 31,914 | |||||||||||
| SBA commercial real estate | – | 1,010 | 682 | 703 | 718 | |||||||||||
| Agricultural real estate | – | – | – | – | – | |||||||||||
| Construction and land development | 23,080 | 25,899 | 29,618 | 30,057 | 31,362 | |||||||||||
| Commercial vacant land | 4,191 | 4,534 | 4,851 | 5,203 | 7,970 | |||||||||||
| Total Non-owner occupied | 295,983 | 295,568 | 297,561 | 279,071 | 255,329 | |||||||||||
| Commercial/Agricultural non-real estate: | ||||||||||||||||
| Municipal non-real estate | 6,403 | 11,858 | 7,623 | 7,014 | 7,165 | |||||||||||
| Commercial line | 54,626 | 52,151 | 47,646 | 45,386 | 46,833 | |||||||||||
| Other commercial non-real estate | 64,260 | 61,115 | 54,481 | 55,002 | 49,246 | |||||||||||
| SBA commercial non-real estate | 6,068 | 17,527 | 25,933 | 47,245 | 89,603 | |||||||||||
| Agricultural non-real estate | 1,340 | 1,130 | 1,325 | 1,656 | 1,730 | |||||||||||
| Total Commercial/Agr. non-real estate | 132,697 | 143,781 | 137,008 | 156,303 | 194,577 | |||||||||||
| Consumer non-real estate: | ||||||||||||||||
| Consumer installment | 4,201 | 4,054 | 4,369 | 4,399 | 3,191 | |||||||||||
| Consumer line | 486 | 480 | 477 | 436 | 498 | |||||||||||
| Other consumer | 118 | 117 | 125 | 130 | 123 | |||||||||||
| Total Consumer non-real estate | 4,805 | 4,651 | 4,971 | 4,965 | 3,812 | |||||||||||
| Gross loans | 887,321 | 888,247 | 886,042 | 875,684 | 842,885 | |||||||||||
| Net deferred loan costs (fees) | 423 | 107 | (167 | ) | (738 | ) | (1,627 | ) | ||||||||
| Overdrafts | 185 | 205 | 654 | 134 | 528 | |||||||||||
| Allowance for loan losses | (12,341 | ) | (12,222 | ) | (12,005 | ) | (11,826 | ) | (11,822 | ) | ||||||
| Total loans receivable | $ | 875,588 | $ | 876,337 | $ | 874,524 | $ | 863,254 | $ | 829,964 | ||||||
| PSB Holdings, Inc. | ||||||||||||||||||||||||||||||
| Deposit Composition | ||||||||||||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||||||||||
| (dollars in thousands) | 2022 | 2021 | 2021 | 2021 | 2021 | |||||||||||||||||||||||||
| $ | % | $ | % | $ | % | $ | % | $ | % | |||||||||||||||||||||
| Non-interest bearing demand | $ | 272,611 | 25.0 | % | $ | 284,477 | 25.7 | % | $ | 291,440 | 26.9 | % | $ | 273,181 | 26.5 | % | $ | 242,974 | 26.2 | % | ||||||||||
| Interest-bearing demand and savings | 382,829 | 35.1 | % | 413,522 | 37.4 | % | 388,725 | 35.9 | % | 366,563 | 35.4 | % | 329,100 | 35.6 | % | |||||||||||||||
| Money market deposits | 221,982 | 20.4 | % | 219,145 | 19.8 | % | 215,772 | 19.9 | % | 212,285 | 20.6 | % | 215,590 | 23.3 | % | |||||||||||||||
| Retail and local time deposits <= $250 | 138,821 | 12.8 | % | 140,443 | 12.8 | % | 142,439 | 13.2 | % | 140,895 | 13.7 | % | 101,866 | 11.0 | % | |||||||||||||||
| Total core deposits | 1,016,243 | 93.3 | % | 1,057,587 | 95.7 | % | 1,038,376 | 95.9 | % | 992,924 | 96.2 | % | 889,530 | 96.1 | % | |||||||||||||||
| Retail and local time deposits > $250 | 28,754 | 2.6 | % | 28,659 | 2.6 | % | 24,824 | 2.3 | % | 25,834 | 2.5 | % | 23,904 | 2.6 | % | |||||||||||||||
| Broker & national time deposits <= $250 | 7,443 | 0.7 | % | 7,793 | 0.7 | % | 8,640 | 0.8 | % | 10,874 | 1.1 | % | 10,423 | 1.1 | % | |||||||||||||||
| Broker & national time deposits > $250 | 36,965 | 3.4 | % | 11,201 | 1.0 | % | 11,201 | 1.0 | % | 1,994 | 0.2 | % | 1,994 | 0.2 | % | |||||||||||||||
| Totals | $ | 1,089,405 | 100.0 | % | $ | 1,105,240 | 100.0 | % | $ | 1,083,041 | 100.0 | % | $ | 1,031,626 | 100.0 | % | $ | 925,851 | 100.0 | % | ||||||||||
| PSB Holdings, Inc. | ||||||||||||||||||||||||
| Average Balances ($000) and Interest Rates | ||||||||||||||||||||||||
| (dollars in thousands) | ||||||||||||||||||||||||
| Quarter ended March 31, 2022 | Quarter ended December 31, 2021 | Quarter ended March 31, 2021 | ||||||||||||||||||||||
| Average | Yield / | Average | Yield / | Average | Yield / | |||||||||||||||||||
| Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate | ||||||||||||||||
| Assets | ||||||||||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||||||
| Loans (1)(2) | $ | 891,257 | $ | 9,065 | 4.12 | % | $ | 882,157 | $ | 8,930 | 4.02 | % | $ | 838,781 | $ | 9,454 | 4.57 | % | ||||||
| Taxable securities | 216,965 | 762 | 1.42 | % | 214,626 | 631 | 1.17 | % | 142,539 | 507 | 1.44 | % | ||||||||||||
| Tax-exempt securities (2) | 87,719 | 675 | 3.12 | % | 83,518 | 639 | 3.04 | % | 84,219 | 635 | 3.06 | % | ||||||||||||
| FHLB stock | 2,646 | 34 | 5.21 | % | 2,646 | 18 | 2.70 | % | 2,283 | 21 | 3.73 | % | ||||||||||||
| Other | 20,448 | 8 | 0.16 | % | 53,098 | 13 | 0.10 | % | 22,390 | 10 | 0.18 | % | ||||||||||||
| Total (2) | 1,219,035 | 10,544 | 3.51 | % | 1,236,045 | 10,231 | 3.28 | % | 1,090,212 | 10,627 | 3.95 | % | ||||||||||||
| Non-interest-earning assets: | ||||||||||||||||||||||||
| Cash and due from banks | 17,996 | 19,967 | 14,248 | |||||||||||||||||||||
| Premises and equipment, net | 12,732 | 12,699 | 11,009 | |||||||||||||||||||||
| Cash surrender value ins | 24,361 | 24,216 | 17,840 | |||||||||||||||||||||
| Other assets | 16,719 | 14,859 | 10,782 | |||||||||||||||||||||
| Allowance for loan losses | (12,278 | ) | (12,006 | ) | (11,186 | ) | ||||||||||||||||||
| Total | $ | 1,278,565 | $ | 1,295,780 | $ | 1,132,905 | ||||||||||||||||||
| Liabilities & stockholders’ equity | ||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||
| Savings and demand deposits | $ | 396,261 | $ | 69 | 0.07 | % | $ | 388,549 | $ | 76 | 0.08 | % | $ | 333,340 | $ | 65 | 0.08 | % | ||||||
| Money market deposits | 218,367 | 89 | 0.17 | % | 222,399 | 93 | 0.17 | % | 217,618 | 118 | 0.22 | % | ||||||||||||
| Time deposits | 198,431 | 285 | 0.58 | % | 188,301 | 307 | 0.65 | % | 138,773 | 364 | 1.06 | % | ||||||||||||
| FHLB borrowings | 51,200 | 169 | 1.34 | % | 52,705 | 192 | 1.45 | % | 62,000 | 215 | 1.41 | % | ||||||||||||
| Other borrowings | 6,452 | 2 | 0.13 | % | 11,585 | 4 | 0.14 | % | 18,964 | 7 | 0.15 | % | ||||||||||||
| Senior sub. notes | 2,500 | 28 | 4.54 | % | 2,500 | 29 | 4.60 | % | 2,500 | 28 | 4.54 | % | ||||||||||||
| Junior sub. debentures | 12,730 | 166 | 5.29 | % | 12,704 | 165 | 5.15 | % | 7,732 | 89 | 4.67 | % | ||||||||||||
| Total | 885,941 | 808 | 0.37 | % | 878,743 | 866 | 0.39 | % | 780,927 | 886 | 0.46 | % | ||||||||||||
| Non-interest-bearing liabilities: | ||||||||||||||||||||||||
| Demand deposits | 271,755 | 293,623 | 235,958 | |||||||||||||||||||||
| Other liabilities | 12,066 | 11,325 | 10,152 | |||||||||||||||||||||
| Stockholders’ equity | 108,803 | 112,089 | 105,868 | |||||||||||||||||||||
| Total | $ | 1,278,565 | $ | 1,295,780 | $ | 1,132,905 | ||||||||||||||||||
| Net interest income | $ | 9,736 | $ | 9,365 | $ | 9,741 | ||||||||||||||||||
| Rate spread | 3.14 | % | 2.89 | % | 3.49 | % | ||||||||||||||||||
| Net yield on interest-earning assets | 3.24 | % | 3.01 | % | 3.62 | % | ||||||||||||||||||
| (1) Nonaccrual loans are included in the daily average loan balances outstanding. | ||||||||||||||||||||||||
| (2) The yield on tax-exempt loans and securities is computed on a tax-equivalent basis using a federal tax rate of 21%. | ||||||||||||||||||||||||
Investor Relations Contact
PSB Holdings, Inc.
1905 Stewart Avenue
Wausau, WI 54401
888.929.9902
InvestorRelations@bankpeoples.com
