First Financial institution Experiences Fourth Quarter 2020 Internet Revenue of $6.2 Million Nasdaq:FRBA

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First Bank Reports Fourth Quarter 2020 Net Income of $6.2 Million Nasdaq:FRBA

Full Year 2020 Net Income of $19.4 Million

For the Fourth Quarter 2020: Strong Revenue and Earnings Growth, Stable and Solid Asset Quality Metrics Continued Effective Expense Management with an Efficiency Ratio1 of 52.5%

HAMILTON, N.J., Jan. 27, 2021 (GLOBE NEWSWIRE) — First Bank (Nasdaq Global Market: FRBA) today announced results for the fourth quarter and full year 2020. Net income for fourth quarter 2020 was $6.2 million, or $0.31 per diluted share, compared to $5.2 million, or $0.25 per diluted share, for the fourth quarter of 2019. Return on average assets and return on average equity for the fourth quarter of 2020 were 1.06% and 10.44%, respectively, compared to fourth quarter 2019 return on average assets and return on average equity of 1.02% and 9.24%, respectively. First Bank’s fourth quarter 2020 adjusted diluted earnings per share2 were $0.31, adjusted return on average assets2 was 1.06% and adjusted return on average equity2 was 10.44% compared to fourth quarter 2019 adjusted diluted earnings per share of $0.29, adjusted return on average assets of 1.16% and adjusted return on average equity of 10.53%.

Net income for 2020 was $19.4 million, or $0.97 per diluted share, compared to $13.4 million, or $0.69 per diluted share, for 2019. Net income for 2019 was adversely impacted by merger-related expenses and a deferred tax asset revaluation. Excluding the impact of these expenses, adjusted diluted earnings per share was $0.88 for 2019.

Fourth Quarter and Full Year 2020 Performance Highlights:

  • Total net revenue (net interest income plus non-interest income) of $21.0 million for the fourth quarter of 2020 grew $3.4 million or 19.0% compared to the prior year quarter. Total net revenue for 2020 was $75.9 million, an increase of $13.5 million, or 21.7% compared to 2019
  • Total loans of $2.05 billion at December 31, 2020, an increase of $324.0 million, or 18.8%, from December 31, 2019
  • Total deposits of $1.90 billion at 2020 yearend, up $262.8 million, or 16.0%, from December 31, 2019, with a $148.3 million, or 53.8%, increase in non-interest bearing deposits
  • Continued effective non-interest expense management was reflected in the fourth quarter 2020 efficiency ratio of 52.54%, compared to 52.64% for fourth quarter 2019 and 49.31% for the linked third quarter of 2020
  • Asset quality metrics remained solid and stable during the quarter, despite the ongoing economic uncertainty associated with the COVID-19 pandemic, with net charge-offs of $465,000, or an annualized 0.09% of average loans, for fourth quarter 2020 and nonperforming loans of $10.2 million on December 31, 2020, or 0.50% of total loans at year-end
  • Fourth quarter 2020 tax equivalent net interest margin of 3.56% increased by 22 basis points compared to fourth quarter 2019 and 33 basis points compared to the linked quarter

“Despite the considerable operational challenges that 2020 presented to all financial institutions, the First Bank team was able to produce strong results highlighted by double-digit loan and deposit growth, continued solid asset quality metrics, net revenue growth of 22%, and a well-managed operating expense profile,” said Patrick L. Ryan, President and Chief Executive Officer.

“Our lenders had a strong year, adding $324 million to the loan portfolio at yearend, with approximately $187 million coming from non-PPP-related organic opportunities. Fourth quarter net loan growth, excluding PPP loans, exceeded $96 million, helping to offset $53.6 million of PPP loan forgiveness in the quarter. Despite this very strong growth to finish the year, we are not changing our expectations for loan growth next year. Net loan growth in any particular quarter can be unpredictable given the timing of new loan funding and payoffs, but we expect annual loan growth in 2021 in the 5% to 7% range.”

“2020 was an important year as we transitioned from an early-stage enterprise focused on growth and scale to a more mature model focused on margin and profitability. To help achieve this transformation, we became laser-focused on two primary goals: i) driving down deposit costs, and ii) improving our deposit mix. We made a concerted effort to reduce our dependence on higher-cost time deposits and to focus on attracting and retaining lower-cost checking and money market accounts. For the quarter ended December 31, 2020, our total deposit cost was 0.50%, significantly improved from 1.39% one year prior, and time deposits were just 27.5% of total deposits, down from 41.0% at the end of 2019. Even more important, our non-interest bearing deposits were 22.3% at year-end compared to 16.8% at the end of 2019. At the same time, our team’s commitment and effort resulted in a more than $262 million increase in total deposits.”

“Despite challenges from COVID-19, our overall asset quality profile actually improved during 2020. Net charge-offs to average loans for the full year 2020 of 0.15% were comparable to 0.12% in 2019 which we consider a solid performance during a year marked by considerable economic uncertainty. When looking at non-performing assets, our ratio actually improved considerably, dropping from 1.20% of average assets at the end of 2019 to 0.46% at the end of 2020. Despite very manageable charge-offs and a reduction in nonperforming loans throughout 2020, we set aside significant additional reserves for potential loan losses in response to the ongoing business disruption that has resulted from the pandemic. While the COVID-19 pandemic has not had a significant impact on charge-offs to-date, we may see some level of charge-offs in 2021 related to the continued challenges facing many business and individual borrowers. With our ALLL/Loans of 1.25%, excluding PPP loans, we feel we have done a good job making sure we’re adequately reserved for potential problems that could arise.”

“Our top and bottom line performance for both the fourth quarter and full year would be considered strong in a normal economic environment, but it’s particularly satisfying in the current period of uncertainty. With net revenue growth of 19% for the quarter and 22% for the year, it appears that we were pulling the right levers. We remain equally focused on maintaining our operating expense at a level that’s appropriate for the size of our organization. With an efficiency ratio in the low 50s during 2020, we were able to take our top line growth and translate it into strong earnings improvement for the quarter and the full year. With an return on average assets over 1% in each of the past two quarters, and a return on average tangible equity3 over 11%, we believe our focus on driving bottom line results is bearing fruit. Importantly, we expect these strong improvements in profitability can continue in to 2021 as we further improve our funding mix, improve our margin and gain further operating leverage.”   

Income Statement

Net interest income for fourth quarter 2020 was $19.7 million, an increase of $3.5 million, or 21.8%, compared to $16.2 million in the fourth quarter of 2019. This increase was primarily the result of a $3.5 million decrease in total interest expense compared to fourth quarter 2019, while interest and dividend income modestly increased. The decrease in total interest expense for fourth quarter 2020 was primarily a result of a $158.7 million decrease in average time deposits coupled with a 112-basis point reduction in the interest rate paid on these deposits, along with a 106-basis point decline in the rate paid on money market deposits. Fourth quarter 2020 interest income on loans increased by $542,000, compared to fourth quarter 2019, reflecting an increase in the average loan balance of $278.6 million, partially offset by a 57-basis point decline in the average yield. The yield on the loan portfolio was impacted by lower rates paid on Paycheck Protection Program (“PPP”) loans, partially offset by amortization of deferred PPP loan fees.

Net interest income of $69.6 million for 2020 increased by $11.2 million, or 19.2%, compared to $58.4 million for 2019. Interest and dividend income for 2020 increased by $5.0 million to $89.2 million, compared to $84.2 million for 2019. Net interest income also benefitted from a $6.2 million decline in interest expense which dropped from $25.8 million in 2019 to $19.6 million in 2020. The increase in interest and dividend income for 2020 was primarily driven by significant growth in average loans, which increased by $336.1 million, but partially offset by a 56-basis point decrease in the average interest rate on loans compared to the prior year. As with the fourth quarter of 2020, the average yield on loans reflected lower rates paid on PPP loans, partially offset by amortization of deferred PPP loan fees. The decline in interest expense for 2020 also was a result of a decrease in the average balance of time deposits, coupled with lower average interest rates paid, and a lower average rate paid on money market deposits.

The fourth quarter 2020 tax equivalent net interest margin of 3.56% increased by 22 basis points compared to 3.34% for the prior-year quarter and increased by 33 basis points from the linked third quarter 2020. The increase in the 2020 fourth quarter margin compared to 2019 was primarily the result of lower average rates paid for interest-bearing liabilities, primarily time and money market deposits, in addition to a significant decline in the average balance of time deposits. The increase in the net interest margin compared to third quarter 2020 was a result of a 15-basis point increase in the yield on average earning assets driven by a higher yield on loans, along with a 25-basis point decline in the cost of interest-bearing liabilities. The higher yield on the loan portfolio reflected the amortization of PPP loan fees during the fourth quarter.

The net interest margin for 2020 was 3.29%, a decrease of 3 basis points compared to 3.32% for the prior year, primarily a result of a 57-basis point decline in the yield on average interest earning assets, mostly offset by a 62-basis point decline in the rate paid on interest bearing liabilities. A decline in the average balance of time deposits along with a 52-basis point decrease in the interest rate was primarily responsible for the lower cost of interest-bearing liabilities in 2020.   

The provision for loan losses for the fourth quarter of 2020 was $1.6 million, an increase of $1.3 million compared to $340,000 in the fourth quarter of 2019, and a decrease of $364,000 compared to the linked third quarter of 2020. The increase in the provision compared to fourth quarter 2019 is primarily attributable to the strong loan growth during the quarter ended December 31, 2020. The provision for loan losses for 2020 totaled $9.5 million compared to $4.0 million for the same period in 2019. The more than two-fold increase in the 2020 provision for loan losses reflected our assessment of the economic uncertainty caused by the ongoing COVID-19 pandemic and its impact on potential credit losses.

Fourth quarter 2020 non-interest income was $1.3 million, a decrease of $181,000 compared to $1.5 million in fourth quarter 2019. The decline was primarily the result of a $323,000 decrease in loan fees (primarily loan swap fees), along with a $121,000 decrease in gains on sale of loans. This was partially offset by a $225,000 increase in gains on recovery of acquired loans. Non-interest income totaled $6.4 million for 2020, an increase of $2.4 million compared to $4.0 million for the same period in 2019. This increase in non-interest income for 2020 was primarily a result of a $1.0 million increase in loan fees (primarily loan swap fees), a $613,000 increase on gains on recovery of acquired loans, and a $459,000 increase in income from bank-owned life insurance.

Non-interest expense for fourth quarter 2020 totaled $11.1 million, an increase of $1.7 million compared to $9.3 million for the prior-year quarter and an increase of $1.4 million compared to the third quarter of 2020. The increase in non-interest expense compared to fourth quarter 2019 was primarily a result of increased salaries and employee benefits reflecting an increase in performance-related compensation expense which was updated based on actual 2020 year-end results, along with increased regulatory and other professional fees.

Non-interest expense for 2020 totaled $40.4 million, an increase of $1.0 million, or 2.6%, compared to $39.4 million for 2019. Excluding $3.6 million in merger-related expenses in 2019, the increase in non-interest expense was $4.7 million, or 13.1%. The 2020 increase in non-interest expense over the prior year was also primarily a result of increased salaries and employee benefits expense, along with an increase in occupancy and equipment costs, which, in addition to other certain non-interest expense categories, reflects a full year of the additional expense related to the acquisition of Grand Bank.

The Bank’s efficiency ratio for the fourth quarter of 2020 was 52.54%, a reduction of 10 basis points compared to 52.64% in the fourth quarter of 2019 and an increase of 323 basis points compared to 49.31% for the linked third quarter of 2020. The efficiency ratio for the full year 2020 was 53.21% compared to 57.28% in 2019.

Pre-provision net revenue4 for fourth quarter 2020 was $10.0 million, an increase of $1.6 million, or 19.2%, compared to $8.4 million for the fourth quarter 2019, and up $61,000, or 0.61%, compared to $9.9 million in the linked third quarter of 2020.

Income tax expense for the three months ended December 31, 2020 was $2.2 million, with an effective tax rate of 25.8%, compared to $2.8 million and an effective tax rate of 34.7% for the fourth quarter of 2019 and $2.0 million with an effective tax rate of 25.5% for the third quarter of 2020. Income tax expense for 2020 was $6.5 million, with an effective tax rate of 25.1% compared to $5.6 million for 2019, with an effective tax rate of 29.3%. Income tax expense for the quarter and full year included an increase in the New Jersey state income tax surcharge from 1.5% to 2.5%. Income tax expense for the quarter and full year ended December 31, 2019 included an expense of approximately $730,000 due to a revaluation of the Bank’s deferred tax assets.

Balance Sheet

Total assets at December 31, 2020 were $2.35 billion, an increase of $334.7 million, or 16.6%, compared to $2.01 billion at December 31, 2019, primarily due to the origination of PPP loans and commercial loan growth. Total loans were $2.05 billion at December 31, 2020, an increase of $324.0 million, or 18.8%, compared to $1.72 billion at December 31, 2019, and an increase of $42.9 million, or 2.1%, from $2.00 billion at end of the linked third quarter of 2020. During the fourth quarter $53.6 million in PPP loans were forgiven. As a result, organic loan growth was $96.5 million, mainly derived from commercial real estate loan activity with existing and new relationships.

Total deposits were $1.90 billion at December 31, 2020, an increase of $262.7 million, or 16.0%, compared to $1.64 billion at December 31, 2019. Non-interest-bearing deposits totaled $424.1 million at December 31, 2020, an increase of $148.3 million, or 53.8%, from December 31, 2019, primarily a result of the Bank’s participation in the PPP lending program and continued growth in commercial banking relationships. Borrowings at December 31, 2020 were $161.1 million, an increase of $55.7 million, or 52.8%, compared to the 2019 yearend. The increase in deposits and borrowings provided additional liquidity to support strong commercial loan growth as well as PPP lending.

Stockholders’ equity was $238.1 million at December 31, 2020, compared to $226.4 million at December 31, 2019. The increase in stockholders’ equity for 2020 was due to net income of $19.4 million, $2.0 million in stock option exercises and restricted stock grants or vesting and an increase in accumulated other comprehensive income of $812,000. The increase was partially offset by stock repurchase program activity, whereby slightly over 1.0 million shares have been repurchased during 2020 for an aggregate of $8.2 million or an average cost of $7.91 per share, along with $2.4 million paid in cash dividends. The Bank’s current share repurchase program received regulatory approval for the repurchase of up to 1.5 million shares of First Bank common stock in the open market. Of the shares repurchased during 2020, only 34,684 shares had been repurchased under this repurchase program which will run through September 30, 2021. So far in 2021, through January 25th, we have repurchased an additional 33,663 shares at an average cost of $9.41 per share.

Asset Quality and Capital Ratios

Net charge-offs for the fourth quarter 2020 were $465,000, compared to $325,000 for fourth quarter 2019 and $633,000 for the linked third quarter of 2020. Net charge-offs as an annualized percentage of average loans were 0.09% in fourth quarter 2020, compared to 0.07% for fourth quarter 2019 and 0.13% for the linked third quarter 2020. Nonperforming loans as a percentage of total loans at December 31, 2020, were 0.50%, compared with 1.32% at December 31, 2019, and 0.63% at September 30, 2020. Average and actual total loan balances in 2020 were impacted by the level of PPP loans. The allowance for loan losses to nonperforming loans was 234.3% at December 31, 2020, compared with 75.8% at December 31, 2019, and 179.7% at September 30, 2020.

As of December 31, 2020, the Bank exceeded all regulatory capital requirements to be considered well capitalized, with a Tier 1 Leverage ratio of 9.74%, a Tier 1 Risk-Based capital ratio of 10.36%, a Common Equity Tier 1 Capital ratio of 10.36%, and a Total Risk-Based capital ratio of 12.90%.

COVID-19 Response

First Bank participated in the PPP, established by the Coronavirus Aid, Relief, and Economic Securities Act (CARES Act), during 2020. PPP is a specialized low-interest loan program funded by the U.S. Treasury Department and administered by the U.S. Small Business Administration (SBA). The PPP provides borrower guarantees for lenders, as well as loan forgiveness incentives for borrowers that utilize the loan proceeds to cover compensation-related business operating costs. As of December 31, 2020, First Bank had 937 PPP loans with a current balance of $137.1 million. First Bank generated gross fees of $6.9 million from the SBA related to the origination of these loans. These fees, net of the associated direct origination costs of approximately $529,000, are being amortized through interest income over the life of the PPP loans. As of December 31, 2020, the Bank had $3.0 million in remaining unamortized fees associated with these loans with $3.3 million in income recorded during the year-ended December 31, 2020 from the amortization of these fees. During the fourth quarter of 2020 the Bank realized $1.8 million in fee income on these loans as any deferred fees remaining on the forgiven loans were accelerated. The Bank is also participating in the appropriations for new PPP loans and advances under the Consolidated Appropriations Act, 2021. Through January 26, 2021 we already have 255 PPP loans totaling $56.5 million approved by the SBA and have begun funding these loans. In addition, we have received another 283 applications totaling $35.9 million that are in various stages of the approval process.

First Bank continues to monitor and analyze its COVID-19 related financial hardship payment deferrals (COVID-19 deferrals) based on asset class and borrower type. As of December 31, 2020, the Bank’s population of COVID-19 deferrals was $37.2 million, or 1.8% of total loans, down from a peak of $433.7 million. The $37.2 million in COVID-19 deferrals is comprised of loans across a diverse list of industries and are primarily secured by real estate. The largest industry components are hospitality at $12.1 million, arts, entertainment and recreation at $8.3 million, multi-family $2.9 million, transportation at $2.6 million, and retail at $2.6 million.

Consistent with industry regulatory guidance, borrowers that were otherwise current on loan payments that were granted COVID-19 related financial hardship payment deferrals continue to be reported as current loans throughout the agreed upon deferral period, continue to accrue interest and are not required to be accounted for as a troubled debt restructuring.

Cash Dividend Declared

On January 19, 2021, the Board of Directors declared a quarterly cash dividend of $0.03 per share to common stockholders of record at the close of business on February 12, 2021, payable on February 26, 2021.

Conference Call

First Bank will host an earnings conference call on Thursday, January 28, 2021, at 9:00 a.m. Eastern Time. The direct dial toll free number for the call is 844-825-9784. For those unable to participate in the call, a replay will be available by dialing 877-344-7529 (access code 10150870) from one hour after the end of the conference call until April 28, 2021. Replay information will also be available on our website at www.firstbanknj.com under the “About Us” tab. Click on “Investor Relations” to access the replay information for the conference call.

About First Bank

First Bank is a New Jersey state-chartered bank with 18 full-service branches in Cinnaminson, Cranbury, Delanco, Denville, Ewing, Flemington, Hamilton, Hamilton Square, Lawrence, Mercerville, Pennington, Randolph, Somerset and Williamstown, New Jersey; and Doylestown, Trevose, Warminster and West Chester, Pennsylvania. With $2.3 billion in assets as of September 30, 2020, First Bank offers a full range of deposit and loan products to individuals and businesses throughout the New York City to Philadelphia corridor. First Bank’s common stock is listed on the Nasdaq Global Market under the symbol “FRBA”.

Forward Looking Statements

This press release contains certain forward-looking statements, either express or implied, within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements include information regarding First Bank’s future financial performance, business and growth strategy, projected plans and objectives, and related transactions, integration of acquired businesses, ability to recognize anticipated operational efficiencies, and other projections based on macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material.  Such forward-looking statements are based on various facts and derived utilizing important assumptions, current expectations, estimates and projections about First Bank, any of which may change over time and some of which may be beyond First Bank’s control. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Further, certain factors that could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to: whether First Bank can: successfully implement its growth strategy, including identifying acquisition targets and consummating suitable acquisitions; continue to sustain its internal growth rate; provide competitive products and services that appeal to its customers and target markets; difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which First Bank operates and in which its loans are concentrated, including the effects of declines in housing market values; the impact of disease pandemics, such as the novel strain of coronavirus disease (COVID-19), on First Bank, its operations and its customers and employees; an increase in unemployment levels and slowdowns in economic growth; First Bank’s level of nonperforming assets and the costs associated with resolving any problem loans including litigation and other costs; changes in market interest rates may increase funding costs and reduce earning asset yields thus reducing margin; the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of First Bank’s investment securities portfolio; the extensive federal and state regulation, supervision and examination governing almost every aspect of First Bank’s operations including changes in regulations affecting financial institutions, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations being issued in accordance with this statute and potential expenses associated with complying with such regulations; uncertainties in tax estimates and valuations, including due to changes in state and federal tax law; First Bank’s ability to comply with applicable capital and liquidity requirements, including First Bank’s ability to generate liquidity internally or raise capital on favorable terms, including continued access to the debt and equity capital markets; possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Forward-Looking Statements” and “Risk Factors” in First Bank’s Annual Report on Form 10-K and any updates to those risk factors set forth in First Bank’s proxy statement, subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if First Bank’s underlying assumptions prove to be incorrect, actual results may differ materially from what First Bank anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and First Bank does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. All forward-looking statements, expressed or implied, included in this communication are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that First Bank or persons acting on First Bank’s behalf may issue.

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1 The efficiency ratio is a non-U.S. GAAP financial measure and is calculated by dividing non-interest expense less merger-related expenses by adjusted total revenue (net interest income plus non-interest income adjusted for certain one-time items). For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

2 Adjusted diluted earnings per share, adjusted return on average assets and adjusted return on average equity are non-U.S. GAAP financial measures and are calculated by dividing net income adjusted for certain merger-related expenses and other one-time gains or expenses by diluted weighted average shares, average assets and average equity, respectively. For a reconciliation of these non-U.S. GAAP financial measures, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

3 Return on average tangible equity is a non-U.S. GAAP financial measure and is calculated by dividing net income by average stockholders’ equity net of goodwill and other intangible assets. For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

4 Pre-provision net revenue is a non-U.S. GAAP financial measure and is calculated by adding net interest income and non-interest income and subtracting non-interest expense adjusted by certain non-recurring items. For a reconciliation of this non-U.S. GAAP financial measure, along with the other non-U.S. GAAP financial measures in this press release, to their comparable U.S. GAAP measures, see the financial reconciliations at the end of this press release.

CONTACT: Patrick L. Ryan, President and CEO
(609) 643-0168, patrick.ryan@firstbanknj.com

FIRST BANK AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except for share data)
 
       
  December 31, 2020    
  (unaudited)   December 31, 2019
Assets      
Cash and due from banks $ 24,203     $ 16,751
Federal funds sold         40,000
Interest bearing deposits with banks   71,270       25,041
Cash and cash equivalents   95,473       81,792
Interest bearing time deposits with banks   4,371       6,087
Investment securities available for sale, at fair value   61,731       47,462
Investment securities held to maturity (fair value of $38,319 at December 31, 2020 and $47,100 at December 31, 2019)   37,593       46,612
Restricted investment in bank stocks   8,545       6,652
Other investments   6,498       6,388
Loans, net of deferred fees and costs   2,047,572       1,723,574
Less: Allowance for loan losses   23,974       17,245
Net loans   2,023,598       1,706,329
Premises and equipment, net   10,736       11,881
Other real estate owned, net   575       1,363
Accrued interest receivable   6,806       4,810
Bank-owned life insurance   50,197       49,580
Goodwill   16,253       16,253
Other intangible assets, net   1,745       2,083
Deferred income taxes   11,394       10,400
Other assets   10,755       13,895
Total assets $ 2,346,270     $ 2,011,587
       
Liabilities and Stockholders’ Equity      
Liabilities:      
Non-interest bearing deposits $ 424,119     $ 275,778
Interest bearing deposits   1,479,498       1,365,089
Total deposits   1,903,617       1,640,867
Borrowings   161,135       105,476
Subordinated debentures   29,508       21,964
Accrued interest payable   561       1,076
Other liabilities   13,341       15,811
Total liabilities   2,108,162       1,785,194
Stockholders’ Equity:      
Preferred stock, par value $2 per share; 10,000,000 shares authorized; no shares issued and outstanding        
Common stock, par value $5 per share; 40,000,000 shares authorized; 20,742,158 shares issued and 19,707,474 shares outstanding at December 31, 2020 and 20,458,665 shares issued and outstanding at December 31, 2019   103,135       101,887
Additional paid-in capital   78,887       78,112
Retained earnings   63,431       46,367
Accumulated other comprehensive income   839       27
Treasury stock, 1,034,684 shares at December 31, 2020   (8,184 )    
Total stockholders’ equity   238,108       226,393
Total liabilities and stockholders’ equity $ 2,346,270     $ 2,011,587
       
FIRST BANK AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except for share data, unaudited)
 
               
  Three Months Ended   Year Ended
  December 31,   December 31,
  2020     2019     2020   2019
Interest and Dividend Income              
Investment securities—taxable $ 500   $ 586     $ 2,229   $ 2,160
Investment securities—tax-exempt   57     84       277     360
Interest bearing deposits with banks, Federal funds sold and other   139     516       911     2,181
Loans, including fees   22,391     21,849       85,784     79,469
Total interest and dividend income   23,087     23,035       89,201     84,170
               
Interest Expense              
Deposits   2,357     5,816       15,573     21,750
Borrowings   565     630       2,260     2,461
Subordinated debentures   441     398       1,815     1,593
Total interest expense   3,363     6,844       19,648     25,804
Net interest income   19,724     16,191       69,553     58,366
Provision for loan losses   1,633     340       9,539     3,984
Net interest income after provision for loan losses   18,091     15,851       60,014     54,382
               
Non-Interest Income              
Service fees on deposit accounts   189     178       629     515
Loan fees   79     402       1,659     623
Income from bank-owned life insurance   352     347       1,624     1,165
Gains on sale of loans   71     192       289     264
Gains on recovery of acquired loans   415     190       1,389     776
Other non-interest income   206     184       762     652
Total non-interest income   1,312     1,493       6,352     3,995
               
Non-Interest Expense              
Salaries and employee benefits   6,601     5,306       22,809     20,460
Occupancy and equipment   1,533     1,377       6,130     5,221
Legal fees   191     159       864     595
Other professional fees   631     397       2,116     1,634
Regulatory fees   273     26       1,076     387
Directors’ fees   220     199       869     785
Data processing   515     584       1,933     1,852
Marketing and advertising   89     147       427     822
Travel and entertainment   15     147       147     486
Insurance   168     61       673     334
Other real estate owned expense, net   73     (7 )     57     152
Merger-related expenses                 3,646
Other expense   743     913       3,286     2,990
Total non-interest expense   11,052     9,309       40,387     39,364
Income Before Income Taxes   8,351     8,035       25,979     19,013
Income tax expense   2,156     2,789       6,531     5,568
Net Income $ 6,195   $ 5,246     $ 19,448   $ 13,445
               
Basic earnings per common share $ 0.31   $ 0.26     $ 0.98   $ 0.70
Diluted earnings per common share $ 0.31   $ 0.25     $ 0.97   $ 0.69
Cash dividends per common share $ 0.03   $ 0.03     $ 0.12   $ 0.12
               
Basic weighted average common shares outstanding   19,721,653     20,377,478       19,885,699     19,098,464
Diluted weighted average common shares outstanding   19,827,708     20,666,729       20,005,432     19,392,429
               
FIRST BANK AND SUBSIDIARIES
AVERAGE BALANCE SHEETS WITH INTEREST AND AVERAGE RATES
(dollars in thousands, unaudited)
                       
                       
  Three Months Ended December 31,
  2020   2019
  Average       Average
  Average       Average
  Balance   Interest   Rate (5)   Balance   Interest   Rate (5)
Interest earning assets                      
Investment securities (1) (2) $ 103,736     $ 569     2.18 %   $ 92,875     $ 688     2.94 %
Loans (3)   2,017,496       22,391     4.42 %     1,738,847       21,849     4.99 %
Interest bearing deposits with banks, Federal funds sold and other   69,015       40     0.23 %     81,247       346     1.69 %
Restricted investment in bank stocks   7,199       84     4.64 %     7,078       122     6.84 %
Other investments   6,493       15     0.92 %     6,374       48     2.99 %
Total interest earning assets (2)   2,203,939       23,099     4.17 %     1,926,421       23,053     4.75 %
Allowance for loan losses   (23,323 )             (17,547 )        
Non-interest earning assets   135,433               128,253          
Total assets $ 2,316,049             $ 2,037,127          
                       
Interest bearing liabilities                      
Interest bearing demand deposits $ 178,190     $ 78     0.17 %   $ 159,936     $ 171     0.42 %
Money market deposits   576,608       624     0.43 %     397,248       1,488     1.49 %
Savings deposits   149,946       207     0.55 %     126,768       338     1.06 %
Time deposits   531,495       1,448     1.08 %     690,194       3,819     2.20 %
Total interest bearing deposits   1,436,239       2,357     0.65 %     1,374,146       5,816     1.68 %
Borrowings   168,396       565     1.33 %     114,965       630     2.17 %
Subordinated debentures   29,491       441     5.98 %     21,946       398     7.25 %
Total interest bearing liabilities   1,634,126       3,363     0.82 %     1,511,057       6,844     1.80 %
Non-interest bearing deposits   429,604               283,112          
Other liabilities   16,220               17,758          
Stockholders’ equity   236,099               225,200          
Total liabilities and stockholders’ equity $ 2,316,049             $ 2,037,127          
Net interest income/interest rate spread (2)       19,736     3.35 %         16,209     2.95 %
Net interest margin (2) (4)         3.56 %           3.34 %
Tax equivalent adjustment (2)       (12 )             (18 )    
Net interest income     $ 19,724             $ 16,191      
                       
(1) Average balance of investment securities available for sale is based on amortized cost.            
(2) Interest and average rates are presented on a tax equivalent basis using a federal income tax rate of 21%.        
(3) Average balances of loans include loans on nonaccrual status.                    
(4) Net interest income divided by average total interest earning assets.                
(5) Annualized.                      
                       
FIRST BANK AND SUBSIDIARIES
AVERAGE BALANCE SHEETS WITH INTEREST AND AVERAGE RATES
(dollars in thousands, unaudited)
                       
                       
  Year Ended December 31,
  2020   2019
  Average       Average
  Average       Average
  Balance   Interest   Rate   Balance   Interest   Rate
Interest earning assets                      
Investment securities (1) (2) $ 103,859     $ 2,564     2.47 %   $ 94,185     $ 2,596     2.76 %
Loans (3)   1,914,266       85,784     4.48 %     1,578,174       79,469     5.04 %
Interest bearing deposits with banks, Federal funds sold and other   83,840       425     0.51 %     73,544       1,575     2.14 %
Restricted investment in bank stocks   6,785       375     5.53 %     6,848       421     6.15 %
Other investments   6,462       111     1.72 %     6,303       185     2.94 %
Total interest earning assets (2)   2,115,212       89,259     4.22 %     1,759,054       84,246     4.79 %
Allowance for loan losses   (20,768 )             (16,458 )        
Non-interest earning assets   132,466               115,695          
Total assets $ 2,226,910             $ 1,858,291          
                       
Interest bearing liabilities                      
Interest bearing demand deposits $ 165,346     $ 455     0.28 %   $ 148,234     $ 877     0.59 %
Money market deposits   524,520       3,982     0.76 %     355,046       5,619     1.58 %
Savings deposits   139,091       1,047     0.75 %     91,293       763     0.84 %
Time deposits   600,447       10,089     1.68 %     658,741       14,491     2.20 %
Total interest bearing deposits   1,429,404       15,573     1.09 %     1,253,314       21,750     1.74 %
Borrowings   131,031       2,260     1.72 %     113,740       2,461     2.16 %
Subordinated debentures   28,367       1,815     6.40 %     21,906       1,593     7.27 %
Total interest bearing liabilities   1,588,802       19,648     1.24 %     1,388,960       25,804     1.86 %
Non-interest bearing deposits   391,686               244,820          
Other liabilities   16,257               17,173          
Stockholders’ equity   230,165               207,338          
Total liabilities and stockholders’ equity $ 2,226,910             $ 1,858,291          
Net interest income/interest rate spread (2)       69,611     2.98 %         58,442     2.93 %
Net interest margin (2) (4)         3.29 %           3.32 %
Tax equivalent adjustment (2)       (58 )             (76 )    
Net interest income     $ 69,553             $ 58,366      
                       
(1) Average balances of investment securities available for sale are based on amortized cost.            
(2) Interest and average rates are presented on a tax equivalent basis using a federal income tax rate of 21%.        
(3) Average balances of loans include loans on nonaccrual status.                    
(4) Net interest income divided by average total interest earning assets.                
                       
FIRST BANK AND SUBSIDIARIES
QUARTERLY FINANCIAL HIGHLIGHTS
(in thousands, except for share and employee data, unaudited)
                     
    As of or For the Quarter Ended
    12/31/2020   9/30/2020   6/30/2020   3/31/2020   12/31/2019
EARNINGS                    
Net interest income   $ 19,724     $ 17,630     $ 16,328     $ 15,871     $ 16,191  
Provision for loan losses     1,633       1,997       2,977       2,932       340  
Non-interest income     1,312       1,946       1,880       1,214       1,493  
Non-interest expense     11,052       9,653       9,767       9,915       9,309  
Income tax expense     2,156       2,023       1,347       1,005       2,789  
Net income     6,195       5,903       4,117       3,233       5,246  
                     
PERFORMANCE RATIOS                    
Return on average assets (1)     1.06 %     1.03 %     0.74 %     0.63 %     1.02 %
Adjusted return on average assets (1) (2)     1.06 %     1.03 %     0.74 %     0.63 %     1.16 %
Return on average equity (1)     10.44 %     10.20 %     7.33 %     5.69 %     9.24 %
Adjusted return on average equity (1) (2)     10.44 %     10.20 %     7.33 %     5.69 %     10.53 %
Return on average tangible equity (1) (2)     11.30 %     11.08 %     7.97 %     6.19 %     10.06 %
Adjusted return on average tangible equity (1) (2)     11.30 %     11.08 %     7.97 %     6.19 %     11.46 %
Net interest margin (1) (3)     3.56 %     3.23 %     3.07 %     3.30 %     3.34 %
Total cost of deposits (1)     0.50 %     0.70 %     0.98 %     1.29 %     1.39 %
Efficiency ratio (2)     52.54 %     49.31 %     53.64 %     58.03 %     52.64 %
Pre-provision net revenue (2)   $ 9,984     $ 9,923     $ 8,441     $ 7,170     $ 8,375  
                     
SHARE DATA                    
Common shares outstanding     19,707,474       19,694,892       19,629,892       20,141,204       20,458,665  
Basic earnings per share   $ 0.31     $ 0.30     $ 0.21     $ 0.16     $ 0.26  
Diluted earnings per share     0.31       0.30       0.21       0.16       0.25  
Adjusted diluted earnings per share (2)     0.31       0.30       0.21       0.16       0.29  
Tangible book value per share (2)     11.17       10.88       10.61       10.33       10.17  
Book value per share     12.08       11.79       11.54       11.23       11.07  
                     
MARKET DATA                    
Market value per share   $ 9.38     $ 6.20     $ 6.52     $ 6.94     $ 11.05  
Market value / Tangible book value     83.98 %     57.01 %     61.46 %     67.20 %     108.66 %
Market capitalization   $ 184,856     $ 122,108     $ 127,987     $ 139,780     $ 226,068  
                     
CAPITAL & LIQUIDITY                    
Tangible stockholders’ equity / tangible assets (2)     9.45 %     9.35 %     9.12 %     10.03 %     10.44 %
Stockholders’ equity / assets     10.15 %     10.06 %     9.84 %     10.81 %     11.25 %
Loans / deposits     107.56 %     109.22 %     101.65 %     101.90 %     105.04 %
                     
ASSET QUALITY                    
Net charge-offs   $ 465     $ 633     $ 1,013     $ 699     $ 325  
Nonperforming loans     10,234       12,694       14,082       13,815       22,748  
Nonperforming assets     10,809       13,397       15,224       14,976       24,111  
Net charge offs / average loans (1)     0.09 %     0.13 %     0.21 %     0.16 %     0.07 %
Nonperforming loans / total loans     0.50 %     0.63 %     0.72 %     0.79 %     1.32 %
Nonperforming assets / total assets     0.46 %     0.58 %     0.66 %     0.72 %     1.20 %
Allowance for loan losses / total loans     1.17 %     1.14 %     1.10 %     1.11 %     1.00 %
Allowance for loan losses / total loans (excluding PPP loans)   1.25 %     1.25 %     1.20 %     1.11 %     1.00 %
Allowance for loan losses / nonperforming loans     234.26 %     179.66 %     152.26 %     140.99 %     75.81 %
                     
OTHER DATA                    
Total assets   $ 2,346,270     $ 2,309,897     $ 2,300,594     $ 2,092,444     $ 2,011,587  
Total loans     2,047,572       2,004,650       1,955,007       1,758,364       1,723,574  
Total deposits     1,903,617       1,835,427       1,923,266       1,725,547       1,640,867  
Total stockholders’ equity     238,108       232,300       226,450       226,259       226,393  
Number of full-time equivalent employees (4)     204       204       209       208       216  
                     
(1) Annualized.                    
(2) Non-U.S. GAAP financial measure that we believe provides management and investors with information that is useful in understanding our financial performance and condition. See accompanying table, “Non-U.S. GAAP Financial Measures”, for calculation and reconciliation.
(3) Tax equivalent using a federal income tax rate of 21%.                    
(4) Includes 4 full-time equivalent seasonal interns as of June 30, 2020.                  
                     
FIRST BANK AND SUBSIDIARIES
QUARTERLY FINANCIAL HIGHLIGHTS
(dollars in thousands, unaudited)
                     
    As of the Quarter Ended
    12/31/2020   9/30/2020   6/30/2020   3/31/2020   12/31/2019
LOAN COMPOSITION                    
Commercial and industrial   $ 388,886     $ 430,722     $ 428,494     $ 247,654     $ 239,090  
Commercial real estate:                    
Owner-occupied     407,089       402,147       392,096       387,217       395,995  
Investor     778,958       721,029       689,891       678,568       673,300  
Construction and development     149,284       146,057       131,791       124,496       105,709  
Multi-family     144,527       133,778       132,942       131,566       119,005  
Total commercial real estate     1,479,858       1,403,011       1,346,720       1,321,847       1,294,009  
Residential real estate:                    
Residential mortgage and first lien home equity loans     120,018       117,530       117,796       118,020       123,917  
Home equity–second lien loans and revolving lines of credit     33,575       27,600       29,371       33,764       32,555  
Total residential real estate     153,593       145,130       147,167       151,784       156,472  
Consumer and other     30,368       32,531       40,230       38,902       35,810  
Total loans prior to deferred loan fees and costs     2,052,705       2,011,394       1,962,611       1,760,187       1,725,381  
Net deferred loan fees and costs     (5,133 )     (6,744 )     (7,604 )     (1,823 )     (1,807 )
Total loans   $ 2,047,572     $ 2,004,650     $ 1,955,007     $ 1,758,364     $ 1,723,574  
                     
LOAN MIX                    
Commercial and industrial     19.0 %     21.5 %     21.9 %     14.1 %     13.9 %
Commercial real estate:                    
Owner-occupied     19.9 %     20.1 %     20.1 %     22.0 %     23.0 %
Investor     38.0 %     36.0 %     35.3 %     38.6 %     39.1 %
Construction and development     7.3 %     7.3 %     6.7 %     7.1 %     6.1 %
Multi-family     7.0 %     6.6 %     6.8 %     7.5 %     6.9 %
Total commercial real estate     72.2 %     70.0 %     68.9 %     75.2 %     75.1 %
Residential real estate:                    
Residential mortgage and first lien home equity loans     5.9 %     5.8 %     6.0 %     6.7 %     7.2 %
Home equity–second lien loans and revolving lines of credit     1.6 %     1.4 %     1.5 %     1.9 %     1.9 %
Total residential real estate     7.5 %     7.2 %     7.5 %     8.6 %     9.1 %
Consumer and other     1.6 %     1.6 %     2.1 %     2.2 %     2.0 %
Net deferred loan fees and costs     (0.3 %)     (0.3 %)     (0.4 %)     (0.1 %)     (0.1 %)
Total loans     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %
                     
FIRST BANK AND SUBSIDIARIES
QUARTERLY FINANCIAL HIGHLIGHTS
(dollars in thousands, unaudited)
                     
    As of the Quarter Ended
    12/31/2020   9/30/2020   6/30/2020   3/31/2020   12/31/2019
DEPOSIT COMPOSITION                    
Non-interest bearing demand deposits   $ 424,119     $ 445,514     $ 459,123     $ 291,949     $ 275,778  
Interest bearing demand deposits     201,881       156,059       165,081       161,726       170,951  
Money market and savings deposits     753,640       695,224       703,365       611,098       521,263  
Time deposits     523,977       538,630       595,697       660,774       672,875  
Total Deposits   $ 1,903,617     $ 1,835,427     $ 1,923,266     $ 1,725,547     $ 1,640,867  
                     
DEPOSIT MIX                    
Non-interest bearing demand deposits     22.3 %     24.3 %     23.9 %     16.9 %     16.8 %
Interest bearing demand deposits     10.6 %     8.5 %     8.6 %     9.4 %     10.4 %
Money market and savings deposits     39.6 %     37.9 %     36.5 %     35.4 %     31.8 %
Time deposits     27.5 %     29.3 %     31.0 %     38.3 %     41.0 %
Total Deposits     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %
                     
FIRST BANK AND SUBSIDIARIES
NON-U.S. GAAP FINANCIAL MEASURES
(in thousands, except for share data, unaudited)
                   
  As of or For the Quarter Ended
  12/31/2020   9/30/2020   6/30/2020   3/31/2020   12/31/2019
Return on Average Tangible Equity                  
Net income (numerator) $ 6,195     $ 5,903     $ 4,117     $ 3,233     $ 5,246  
                   
Average stockholders’ equity $ 236,099     $ 230,122     $ 225,905     $ 228,471     $ 225,200  
Less: Average Goodwill and other intangible assets, net   18,062       18,156       18,236       18,309       18,377  
Average Tangible stockholders’ equity (denominator) $ 218,037     $ 211,966     $ 207,669     $ 210,162     $ 206,823  
                   
Return on Average Tangible equity   11.30 %     11.08 %     7.97 %     6.19 %     10.06 %
                   
Tangible Book Value Per Share                  
Stockholders’ equity $ 238,108     $ 232,300     $ 226,450     $ 226,259     $ 226,393  
Less: Goodwill and other intangible assets, net   17,998       18,108       18,192       18,245       18,336  
Tangible stockholders’ equity (numerator) $ 220,110     $ 214,192     $ 208,258     $ 208,014     $ 208,057  
                   
Common shares outstanding (denominator)   19,707,474       19,694,892       19,629,892       20,141,204       20,458,665  
                   
Tangible book value per share $ 11.17     $ 10.88     $ 10.61     $ 10.33     $ 10.17  
                   
                   
Tangible Equity / Assets                  
Stockholders’ equity $ 238,108     $ 232,300     $ 226,450     $ 226,259     $ 226,393  
Less: Goodwill and other intangible assets, net   17,998       18,108       18,192       18,245       18,336  
Tangible equity (numerator) $ 220,110     $ 214,192     $ 208,258     $ 208,014     $ 208,057  
                   
Total assets $ 2,346,270     $ 2,309,897     $ 2,300,594     $ 2,092,444     $ 2,011,587  
Less: Goodwill and other intangible assets, net   17,998       18,108       18,192       18,245       18,336  
Adjusted total assets (denominator) $ 2,328,272     $ 2,291,789     $ 2,282,402     $ 2,074,199     $ 1,993,251  
                   
Tangible equity / assets   9.45 %     9.35 %     9.12 %     10.03 %     10.44 %
                   
                   
Efficiency Ratio (1)                  
Non-interest expense $ 11,052     $ 9,653     $ 9,767     $ 9,915     $ 9,309  
Adjusted non-interest expense (numerator) $ 11,052     $ 9,653     $ 9,767     $ 9,915     $ 9,309  
                   
Net interest income $ 19,724     $ 17,630     $ 16,328     $ 15,871     $ 16,191  
Non-interest income   1,312       1,946       1,880       1,214       1,493  
Total revenue   21,036       19,576       18,208       17,085       17,684  
Adjusted total revenue (denominator) $ 21,036     $ 19,576     $ 18,208     $ 17,085     $ 17,684  
                   
Efficiency ratio   52.54 %     49.31 %     53.64 %     58.03 %     52.64 %
                   
                   
Pre-Provision Net Revenue (1)                  
Net interest income $ 19,724     $ 17,630     $ 16,328     $ 15,871     $ 16,191  
Non-interest income   1,312       1,946       1,880       1,214       1,493  
Less: Non-interest expense   11,052       9,653       9,767       9,915       9,309  
Pre-provision net revenue $ 9,984     $ 9,923     $ 8,441     $ 7,170     $ 8,375  
                   
(1) During the quarter ended 6/30/2020 the efficiency ratio and pre-provision net revenue calculations were changed from the way these amounts were calculated in previous period reports. The prior quarter numbers above have been adjusted accordingly. Gains on recovery of acquired loans are no longer removed from the revenue numbers as management has determined that these amounts have become part of our core operations and should not be removed in our adjusted totals.
 
FIRST BANK AND SUBSIDIARIES
NON-U.S. GAAP FINANCIAL MEASURES
(dollars in thousands, except for share data, unaudited)
                   
                   
  For the Quarter Ended
  12/31/2020   9/30/2020   6/30/2020   3/31/2020   12/31/2019
                   
Adjusted diluted earnings per share,                  
Adjusted return on average assets, and                  
Adjusted return on average equity (1)                  
                   
Net income $ 6,195     $ 5,903     $ 4,117     $ 3,233     $ 5,246  
Add: Deferred Tax Asset revaluation                           730  
Adjusted net income $ 6,195     $ 5,903     $ 4,117     $ 3,233     $ 5,976  
                   
Diluted weighted average common shares outstanding   19,827,708       19,603,919       19,744,575       20,565,867       20,666,729  
Average assets $ 2,316,049     $ 2,289,303     $ 2,251,396     $ 2,049,229     $ 2,037,127  
Average equity $ 236,099     $ 230,122     $ 225,905     $ 228,471     $ 225,200  
Average Tangible Equity $ 218,037     $ 211,966     $ 207,669     $ 210,162     $ 206,823  
                   
Adjusted diluted earnings per share $ 0.31     $ 0.30     $ 0.21     $ 0.16     $ 0.29  
Adjusted return on average assets (2)   1.06 %     1.03 %     0.74 %     0.63 %     1.16 %
Adjusted return on average equity (2)   10.44 %     10.20 %     7.33 %     5.69 %     10.53 %
Adjusted return on average tangible equity (2)   11.30 %     11.08 %     7.97 %     6.19 %     11.46 %
                   
(1) During the quarter ended 6/30/2020 the adjusted net income calculation was changed from the way it was calculated in previous period reports. The prior quarter amounts above have been adjusted accordingly. Gains on recovery of acquired loans are no longer removed from adjusted net income as management has determined that these amounts have become part of our core operations and should not be removed in our adjusted totals.
(2) Annualized.                  
                   
FIRST BANK AND SUBSIDIARIES
NON-U.S. GAAP FINANCIAL MEASURES
(dollars in thousands, except for share data, unaudited)
       
       
  Year Ended December 31,
    2020       2019  
               
Adjusted diluted earnings per share,      
Adjusted return on average assets, and      
Adjusted return on average equity      
       
Net income $ 19,448     $ 13,445  
Add: Merger-related expenses (1)         2,880  
Add: Impact of tax rate change         730  
Adjusted net income $ 19,448     $ 17,055  
       
Diluted weighted average common shares outstanding   20,005,432       19,392,429  
Average assets $ 2,226,910     $ 1,858,291  
Average equity $ 230,165     $ 207,338  
Average Tangible Equity $ 211,975     $ 189,670  
       
Adjusted diluted earnings per share $ 0.97     $ 0.88  
Adjusted return on average assets   0.87 %     0.92 %
Adjusted return on average equity   8.45 %     8.23 %
Adjusted return on average tangible equity   9.17 %     8.99 %
       
(1) Tax-effected using a federal income tax rate of 21%