Exchange Bank (OTC: EXSR) on Thursday reported net income for the first quarter of $8.49 million.
That was a 1.6% dip from $8.63 million for the same period in 2020.
With earnings remaining fairly steady during a global pandemic, the Santa Rosa-based bank attributes the decrease to a decline in net and non-interest incomes as well as loan-loss provisions.
Net interest income — $23.27 million, compared with $23.9 million in 2020’s first quarter — reflects the difference between revenue generated by interest-bearing assets and the costs of servicing liabilities. Quarterly non-interest income — derived by fees — was $5.4 million this year, compared with $5.87 million a year before.
Provisions in lending losses take into account allowances used to cover underperforming loans and bankruptcies.
“In response to the pandemic and the resulting societal and economic disruptions, the bank began provisioning for loan losses in the third quarter of 2020 in a defensive posture,” CEO and President Troy Sanderson said in a statement. “If not for the provision of $1.2 million in the first quarter of 2021, year-over-year first quarter income would actually be up 12.28%”
“The two quarters are very different. When you compare year-over year, they’re like apples and oranges,” Sanderson told the Business Journal, referring the difference between 2020 and 2021.
The bank’s new Chief Financial Officer, Shari DeMaris, remarked she viewed the earnings report as positive — especially given the year the nation just left.
“Our earnings were solid, despite the challenges,” she said.
Indeed, there are more silver linings from the earnings report going into the bulk of the year, the bank reported.
The loss of interest income was somewhat offset by the federal Paycheck Protection Program loans processed in both years. As of March 31, the bank had processed $227 million in net loans for struggling businesses dealing with the fallout of COVID-19. And bank officials contend the quality of its loan portfolio remains strong.
In addition, the Sonoma County bank has reduced quarterly operating expenses by $2 million as of March 31, from $17.78 million a year before.
The financial institution has also spent the last two years upgrading its infrastructure in its digital platform, an investment that is aimed to benefit the bank over the long haul. That expense will go away in this coming year.
Plus, deposit balances surged by 27% to $2.94 billion in this year’s first quarter. Sanderson points to a savings rate that has stayed robust through the pandemic. Better yet, PPP recipients constituting over 90% of the bank’s regular clientele placed much of that funding back into accounts when their loans were forgiven.
Total assets grew to $3.29 billion in contrast to 2020’s $2.64 billion.
The value of dividends for this past quarter and when they’re payable will be announced next month, according to bank officials.
Susan Wood covers law, cannabis, production, energy, transportation, agriculture as well as banking and finance. For 25 years, Susan has worked for a variety of publications including the North County Times, now a part of the Union Tribune in San Diego County, along with the Tahoe Daily Tribune and Lake Tahoe News. She graduated from Fullerton College. Reach her at 530-545-8662 or susan.wood@busjrnl.com
"exchange" - Google News
May 07, 2021 at 04:33AM
https://ift.tt/33mx3FD
Exchange Bank Q1 earnings dip nearly 2%, affected by loan-loss provision - North Bay Business Journal
"exchange" - Google News
https://ift.tt/3c55nbe
https://ift.tt/3b2gZKy
Exchange
Bagikan Berita Ini
0 Response to "Exchange Bank Q1 earnings dip nearly 2%, affected by loan-loss provision - North Bay Business Journal"
Post a Comment