Limestone Bancorp Experiences Web Revenue of $3.1 million, or $0.42 per Share, for the 4th Quarter of 2020 and $9.Zero million, or $1.20 per Diluted Share, for the Twelve Months Ended December 31, 2020

0
104
Limestone Bancorp Reports Net Income of $3.1 million, or $0.42 per Share, for the 4th Quarter of 2020 and $9.0 million, or $1.20 per Diluted Share, for the Twelve Months Ended December 31, 2020

LOUISVILLE, Ky.–(BUSINESS WIRE)–Limestone Bancorp, Inc. (NASDAQ: LMST) (“the Company”), parent company of Limestone Bank (“the Bank”), today reported unaudited results for the fourth quarter and full year of 2020. Net income available to common shareholders for the fourth quarter of 2020 was $3.1 million, or $0.42 per basic and diluted common share, compared with $1.8 million, or $0.24 per basic and diluted share, for the fourth quarter of 2019. Net income for the twelve months ended December 31, 2020, was $9.0 million, or $1.20 per diluted common share, compared with net income of $10.5 million, or $1.41 per diluted share, for the twelve months ended December 31, 2019.

“While 2020 will likely be remembered as a challenging year, I am proud of the work accomplished by the Limestone Bank team,” stated John T. Taylor, President and CEO. “Fighting the headwinds of the pandemic, our team adjusted to the COVID environment by providing support to our communities and customers through participation in the SBA Paycheck Protection Program and the relief prescribed in the CARES Act. We did all this while implementing measures to ensure our personnel were safe and healthy to serve our customers. The team at Limestone quickly reacted to the falling interest rate environment, grew earning assets, and continued to successfully grow our franchise value by onboarding high quality core deposit relationships. The long-term impact of the pandemic may not yet be fully known, but we believe we are well-positioned for the future with a scalable community banking platform as well as sound credit metrics and reserves.”

Income Taxes – Net income before taxes was $10.6 million for the year ended December 31, 2020, compared with $11.0 million for the year ended 2019. Income tax expense was $1.6 million for 2020 compared to $480,000 for 2019. For 2020 and 2019, income tax expense benefitted from the establishment of a net deferred tax asset related to a change in Kentucky tax law enacted during 2019. Income tax expense benefitted $478,000 and $1.6 million for the years ended December 31, 2020 and 2019, respectively, or $0.06 per basic and diluted common share, and $0.21 per basic and diluted common share, respectively. The new Kentucky income tax went into effect on January 1, 2021.

Net Interest Income – Net interest income increased to $10.8 million for the fourth quarter of 2020, compared to $9.9 million for the third quarter of 2020, and $8.9 million for the fourth quarter of 2019. Average loans increased to $965.3 million for the fourth quarter of 2020, compared to $963.5 million for the third quarter of 2020, and $846.2 million for the fourth quarter of 2019. Average loans for 2020 were positively impacted by the branch purchase transaction on November 15, 2019, which included $126.8 million in loans at the time of purchase, as well as $42.4 million of 2020 loan originations under the SBA Paycheck Protection Program. After forgiveness and paydowns, PPP loans declined to $20.3 million at December 31, 2020. Net interest margin increased to 3.53% for the fourth quarter of 2020, compared with 3.27% for the third quarter of 2020, and 3.23% for the fourth quarter of 2019.

The yield on earning assets increased to 4.12% in the fourth quarter of 2020, compared to 3.98% in the third quarter of 2020, and decreased compared to 4.57% in the fourth quarter of 2019. The yield on earning assets for the third and fourth quarters of 2020 were negatively impacted by lower interest rates on the Bank’s fed funds, certain floating rate investment securities, and loans with variable rate repricing features. Loan fee income can meaningfully impact net interest income, loan yields, and net interest margin. The amount of loan fee income included in total interest income was $1.0 million, $387,000, and $218,000 for the quarters ended December 31, 2020, September 30, 2020, and December 31, 2019, respectively. This represents 33 basis points, 13 basis points, and eight basis points of yield on earning assets and net interest margin for the quarters ended December 31, 2020, September 30, 2020, and December 31, 2019, respectively. Loan fee income for the fourth quarter of 2020 included $767,000 in fees earned on SBA PPP loans, as compared to $195,000 in the third quarter of 2020.

The cost of interest-bearing liabilities was 0.76% for the fourth quarter of 2020, compared to 0.90% in the third quarter of 2020, and 1.65% in the fourth quarter of 2019. The cost of interest-bearing liabilities continued to decline primarily based on the downward repricing of time deposits. Time deposits declined $30.9 million during the fourth quarter of 2020 as approximately $84.7 million of time deposits with an average rate of 1.01% matured or repriced at lower interest rates. During the fourth quarter of 2020, newly originated or renewed time deposits had an average rate of 0.33% and a weighted average term of approximately 19 months.

Net interest income increased to $40.6 million for the year ended December 31, 2020, compared with $35.4 million for 2019. Average loans increased to $964.1 million for 2020, compared with $801.8 million for 2019. Average loans were positively impacted by the branch purchase transaction on November 15, 2019, along with loan growth during 2019 and 2020, as well as SBA PPP loan originations as discussed above. Net interest margin decreased to 3.36% for 2020, compared with 3.40% for 2019.

The yield on earning assets decreased to 4.20% for year ended December 31, 2020, compared to 4.76% for 2019. The amount of loan fee income included in total interest income was $2.1 million and $1.2 million for the year ended December 31, 2020 and December 31, 2019, respectively. This represents 18 basis points and 11 basis points of yield on earning assets and net interest margin for 2020 and 2019, respectively. Loan fee income for the year ended December 31, 2020, included $1.1 million in fees earned on SBA PPP loans. The cost of interest-bearing liabilities was 1.05% for 2020, compared to 1.66% for 2019.

As of December 31, 2020, time deposits comprise $367.6 million of the Company’s liabilities including $104.9 million with a current average rate of 0.99%, which reprice or mature in the first quarter of 2021. The following table denotes contractual time deposit maturities and average rates as of December 31, 2020:

Maturity

Quarter

 

As of

December 31,

2020

(in thousands)

Weighted

Average

Rate

 

 

 

 

Q1-2021

 

 

104,874

0.99

 

Q2-2021

 

 

102,627

0.57

 

Q3-2021

 

 

42,557

0.59

 

Q4-2021

 

 

21,782

0.50

 

Q1-2022

 

 

11,034

0.80

 

Thereafter

 

 

84,678

1.18

 

Total time deposits

 

$

367,552

0.84

%

Investment Securities – The securities portfolio serves as a source of liquidity and earnings and contributes to the management of interest rate risk. Investments are made in various types of liquid assets, including U.S. Treasury obligations and securities of various federal agencies, obligations of states and political subdivisions, corporate bonds, and collateralized loan obligations.

The following table sets forth the carrying value of our securities portfolio at the dates indicated.

 

 

 

December 31, 2020

 

 

September 30, 2020

 

 

 

Amortized

Cost

 

 

Gross

Unrealized

Gains

 

 

Gross

Unrealized

Losses

 

 

Fair

Value

 

 

Amortized

Cost

 

 

Gross

Unrealized

Gains

 

 

Gross

Unrealized

Losses

 

 

Fair

Value

 

 

 

 

(dollars in thousands)

 

Securities available for sale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and federal agencies

 

$

18,811

 

 

$

806

 

 

$

 

 

$

19,617

 

 

$

19,158

 

 

$

931

 

 

$

 

 

$

20,089

 

 

Agency mortgage-backed residential

 

 

71,582

 

 

 

2,777

 

 

 

(26

)

 

 

74,333

 

 

 

76,388

 

 

 

2,974

 

 

 

(13

)

 

 

79,349

 

 

Collateralized loan obligations

 

 

44,730

 

 

 

 

 

 

(1,578

)

 

 

43,152

 

 

 

44,730

 

 

 

 

 

 

(1,905

)

 

 

42,825

 

 

State and municipal

 

 

34,759

 

 

 

1,296

 

 

 

 

 

 

36,055

 

 

 

34,391

 

 

 

1,076

 

 

 

(32

)

 

 

35,435

 

 

Corporate bonds

 

 

31,635

 

 

 

472

 

 

 

(1,402

)

 

 

30,705

 

 

 

27,116

 

 

 

373

 

 

 

(1,643

)

 

 

25,846

 

 

Total available for sale

 

$

201,517

 

 

$

5,351

 

 

$

(3,006

)

 

$

203,862

 

 

$

201,783

 

 

$

5,354

 

 

$

(3,593

)

 

$

203,544

 

 

 

Provision and Allowance for Loan Losses – The allowance for loan losses to total loans was 1.29% at December 31, 2020, compared to 1.18% at September 30, 2020, and 0.90% at December 31, 2019. Loans acquired in the November 2019 branch transaction totaled $85.9 million at December 31, 2020, and $100.3 million at September 30, 2020. These loans were recorded at fair value as determined by an independent third party. The remaining discount associated with the fair value purchase accounting adjustments on the acquired loans was $288,000 at December 31, 2020, compared to $301,000 at September 30, 2020. Subsequent deterioration of these acquired loans, if any, may require an adjustment through the allowance for loan loss.

A provision of $900,000 and $4.4 million, or $0.09 and $0.46, per common share after taxes, was recorded in the fourth quarter and the year ended December 31, 2020, compared to no provision for loan losses in the fourth quarter and the year ended December 31, 2019. The 2020 loan loss provisions were attributable to the net loan charge-offs during the year, trends within the portfolio during the year, and primarily to changes in the economic and business environment attributable to COVID-19, the state and national emergencies that have been declared, and the resultant risk the pandemic poses for business disruptions for the Bank’s borrowers which may lead to credit quality deterioration. Net loan charge-offs were $333,000 for 2020, compared to net loan charge-offs of $504,000 for 2019.

While the Company expects the U.S. Government’s economic responses to the COVID-19 pandemic through monetary policy and fiscal stimulus have provided meaningful support to the economy, management deemed it prudent to increase the allowance for loan losses through its qualitative environmental factors to account for the pandemic risk.

COVID-19 Short-term Loan Concessions – The Bank has elected to account for eligible loan modifications under Section 4013 of the CARES Act. To be an eligible loan under Section 4013 of the CARES Act, a loan modification must be (1) related to the coronavirus pandemic (“COVID-19”); (2) executed on a loan that was not more than 30 days past due as of December 31, 2019; and (3) executed between March 1, 2020, and the earlier of (A) 60 days after the date of termination of the national emergency declared by the President on March 13, 2020, concerning the COVID-19 outbreak (the “national emergency”) or (B) January 1, 2022. Eligible loan modifications are not required to be classified as TDRs and will not be reported as past due provided they are performing in accordance with the modified terms. Interest income will continue to be recognized in accordance with GAAP unless the loan is placed on nonaccrual status.

Short-term loan modifications totaled $15.3 million as of December 31, 2020, compared to $64.9 million at September 30, 2020. The following table details the status of the Bank’s short-term loan modifications by loan category or type as of December 31, 2020:

First

Modification

Active

 

Subsequent

Modification

Active

 

Modification

Ended

 

Total

Modified

Loans

 

Total

Loan

Portfolio

 

% Modified

to Total

Portfolio

(in thousands)

 

Hotel, Motel, & Lodging

 

$

 

 

$

 

 

$

7,822

 

 

$

7,822

 

 

$

51,822

 

 

 

15.1

%

Retail Facility

 

 

 

 

 

4,355

 

 

 

 

 

 

4,355

 

 

 

67,785

 

 

 

6.4

 

Commercial Real Estate

 

 

 

 

 

346

 

 

 

 

 

 

346

 

 

 

160,433

 

 

 

0.2

 

1-4 Family Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

 

188,955

 

 

 

 

Restaurant Full Service

 

 

 

 

 

 

 

 

 

 

 

 

 

 

15,094

 

 

 

 

Restaurant Limited Service

 

 

2,303

 

 

 

 

 

 

 

 

 

2,303

 

 

 

15,780

 

 

 

14.6

 

Multi-family

 

 

 

 

 

 

 

 

 

 

 

 

 

 

61,180

 

 

 

 

Construction and Development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

48,396

 

 

 

 

Commercial & Industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

208,244

 

 

 

 

Farmland

 

 

 

 

 

 

 

 

 

 

 

 

 

 

70,272

 

 

 

 

Consumer, Agriculture & Other

 

 

 

 

 

 

 

 

486

 

 

 

486

 

 

 

74,120

 

 

 

0.7

 

Total

 

$

2,303

 

 

$

4,701

 

 

$

8,308

 

 

$

15,312

 

 

$

962,081

 

 

 

1.6

%

 

First Modification Active includes loans within the terms of the original modification agreement. Subsequent Modification Active includes loans with a matured original modification that have been further modified within the short-term parameters. Modification Ended includes loans that have reached final deferred payment and have yet to make a payment in accordance with the loan’s original terms or have yet to request a subsequent modification. Loans that returned to original contracted terms with a verified payment are considered cured and are no longer included as modified loans in the table above.

The table above includes one commercial real estate loan secured by a retail facility totaling $4.4 million that remains subject to and is performing in accordance with an interest only short-term subsequent COVID-19 modification. The loan is graded substandard, has been evaluated under ASC-310-10, and allocated a specific reserve of $2.2 million as of December 31, 2020.

Subsequent to December 31, 2020, $8.3 million of the loans categorized as “Modification Ended” in the table above have received a verified payment and are now considered cured.

Non-performing Assets – Non-performing assets, which include loans on nonaccrual, accruing troubled debt restructurings, loans past due 90 days and still accruing, and other real estate owned (“OREO”), decreased to $3.9 million, or 0.30%, of total assets at December 31, 2020, compared with $4.2 million, or 0.32%, of total assets at September 30, 2020, and $5.2 million, or 0.42%, of total assets at December 31, 2019.

Non-interest Income and Expense – Non-interest income for the fourth quarter of 2020 increased $123,000 to $1.8 million, compared with $1.7 million for the fourth quarter of 2019. The increase was primarily related to bank card interchange fees of $171,000 as a result of the deposit accounts acquired in the branch transaction on November 15, 2019. Non-interest expense decreased $448,000, or 5.4%, to $7.9 million for the fourth quarter of 2020, compared with $8.3 million for the fourth quarter of 2019. Deposit account related expense increased by $159,000, occupancy expense increased by $121,000, and franchise tax expense increased by $130,000, which were all primarily the result of the branch acquisition. Non-interest expense for 2019 also included $775,000 of acquisition expenses related to the branch purchase transaction.

Non-interest income increased $926,000 to $6.8 million for the year ended December 31, 2020, compared with $5.9 million for year ended December 31, 2019. The increase was primarily related to bank card interchange fees of $938,000 as a result of the deposit accounts acquired in the branch purchase transaction. Non-interest expense increased $2.1 million, or 7.1%, to $32.4 million for year ended December 31, 2020, compared with $30.3 million for the year ended December 31, 2019. The increase was primarily due to an increase in salaries and employee benefits of $1.5 million and $666,000 in deposit account related expense. While the Bank added sales talent and customer facing associates during the latter half of 2019 and branch staff in connection with the branch purchase transaction, the Bank realized a reduction in FTEs from 248 at March 31, 2020, to 219 as of December 31, 2020, through attrition and workforce reduction. The increase in deposit account related expense is the result of the deposit accounts acquired in the branch purchase transaction.

Capital – The Company’s capital ratios were positively impacted by the additional $8.0 million of subordinated notes issued during the third quarter, as the subordinated notes meet the requirements to qualify as Tier 2 capital.

About Limestone Bancorp, Inc.

Limestone Bancorp, Inc. (NASDAQ: LMST) is a Louisville, Kentucky-based bank holding company which operates banking centers in 14 counties through its wholly-owned subsidiary Limestone Bank. The Bank’s markets include metropolitan Louisville in Jefferson County and the surrounding counties of Bullitt and Henry and extend south along the Interstate 65 corridor. The Bank serves south central, southern, and western Kentucky from banking centers in Barren, Butler, Daviess, Edmonson, Green, Hardin, Hart, Ohio, and Warren counties. The Bank also has banking centers in Lexington, Kentucky, the second largest city in the state, and Frankfort, Kentucky, the state capital. Limestone Bank is a traditional community bank with a wide range of personal and business banking products and services.

Forward-Looking Statements

Statements in this press release relating to Limestone Bancorp’s plans, objectives, expectations or future performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “may,” “should,” “anticipate,” “estimate,” “expect,” “intend,” “objective,” “possible,” “seek,” “plan,” “strive” or similar words, or negatives of these words, identify forward-looking statements that involve risks and uncertainties. Although the Company’s management believes the assumptions underlying the forward-looking statements contained herein are reasonable, any of these assumptions could be inaccurate. Therefore, there can be no assurance the forward-looking statements included herein will prove to be accurate. Factors that could cause actual results to differ from those discussed in forward-looking statements include, but are not limited to: the impact and duration of the COVID-19 pandemic and national, state and local emergency conditions the pandemic has produced; economic conditions both generally and more specifically in the markets in which the Company and its subsidiaries operate; competition for the Company’s customers from other providers of financial services; government legislation, regulation, fiscal, and monetary policies, which change from time to time and over which the Company has no control; changes in interest rates; material unforeseen changes in liquidity, results of operations, or financial condition of the Company’s customers; and other risks detailed in the Company’s filings with the Securities and Exchange Commission, all of which are difficult to predict and many of which are beyond the control of the Company. See Risk Factors outlined in the Company’s Form 10-K for the year ended December 31, 2019, and Form 10-Q for the nine months ended September 30, 2020.

Additional Information

Unaudited supplemental financial information for the fourth quarter ending December 31, 2020, follows.

 
 

LIMESTONE BANCORP, INC.

Unaudited Financial Information

(in thousands, except share and per share data)

 

Three

 

Three

 

Twelve

 

Twelve

 

 

Months

 

Months

 

Months

 

Months

 

 

Ended

 

Ended

 

Ended

 

Ended

 

 

12/31/20

 

12/31/19

 

12/31/20

 

12/31/19

 

 

 

 

 

 

 

 

 

 

 

 

Income Statement Data

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

12,606

 

$

12,537

 

$

50,753

 

$

49,584

 

Interest expense

 

1,820

 

 

3,676

 

 

10,152

 

 

14,234

 

Net interest income

 

10,786

 

 

8,861

 

 

40,601

 

 

35,350

 

Provision for loan losses

 

900

 

 

 

 

4,400

 

 

 

Net interest income after provision

 

9,886

 

 

8,861

 

 

36,201

 

 

35,350

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

594

 

 

681

 

 

2,268

 

 

2,381

 

Bank card interchange fees

 

882

 

 

711

 

 

3,376

 

 

2,438

 

Bank owned life insurance income

 

99

 

 

96

 

 

424

 

 

410

 

Gain (loss) on sales and calls of securities, net

 

 

 

 

 

(5

)

 

(5

)

Other

 

202

 

 

166

 

 

781

 

 

694

 

Non-interest income

 

1,777

 

 

1,654

 

 

6,844

 

 

5,918

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries & employee benefits

 

4,167

 

 

4,201

 

 

17,751

 

 

16,233

 

Occupancy and equipment

 

1,011

 

 

890

 

 

4,001

 

 

3,522

 

Professional fees

 

233

 

 

171

 

 

937

 

 

769

 

Marketing expense

 

177

 

 

218

 

 

629

 

 

908

 

FDIC insurance

 

81

 

 

 

 

229

 

 

211

 

Data processing expense

 

381

 

 

316

 

 

1,502

 

 

1,259

 

State franchise and deposit tax

 

395

 

 

265

 

 

1,475

 

 

1,210

 

Deposit account related expense

 

492

 

 

333

 

 

1,890

 

 

1,224

 

Other real estate owned expense

 

5

 

 

35

 

 

63

 

 

368

 

Litigation and loan collection expense

 

22

 

 

77

 

 

200

 

 

189

 

Communications expense

 

190

 

 

200

 

 

856

 

 

772

 

Insurance expense

 

112

 

 

109

 

 

428

 

 

444

 

Postage and delivery

 

151

 

 

140

 

 

627

 

 

544

 

Acquisition costs

 

 

 

775

 

 

 

 

775

 

Other

 

449

 

 

584

 

 

1,828

 

 

1,842

 

Non-interest expense

 

7,866

 

 

8,314

 

 

32,416

 

 

30,270

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

3,797

 

 

2,201

 

 

10,629

 

 

10,998

 

Income tax expense

 

680

 

 

437

 

 

1,624

 

 

480

 

Net income

$

3,117

 

$

1,764

 

$

9,005

 

$

10,518

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares – Basic

 

7,499,323

 

 

7,471,680

 

 

7,492,190

 

 

7,468,215

 

Weighted average shares – Diluted

 

7,499,323

 

 

7,471,680

 

 

7,492,190

 

 

7,468,215

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

$

0.42

 

$

0.24

 

$

1.20

 

$

1.41

 

Diluted earnings per common share

$

0.42

 

$

0.24

 

$

1.20

 

$

1.41

 

Cash dividends declared per common share

$

0.00

 

$

0.00

 

$

0.00

 

$

0.00

 

 
 

LIMESTONE BANCORP, INC.

Unaudited Financial Information

(in thousands, except share and per share data)

 

 

Three

 

Three

 

Three

 

 

Three

 

 

Three

 

 

 

Months

 

Months

 

Months

 

 

Months

 

 

Months

 

 

 

Ended

 

Ended

 

Ended

 

 

Ended

 

 

Ended

 

 

 

12/31/20

 

9/30/20

 

6/30/20

 

 

3/31/20

 

 

12/31/19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Statement Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

12,606

 

$

12,094

 

$

12,786

 

$

13,267

 

$

12,537

 

Interest expense

 

1,820

 

 

2,151

 

 

2,676

 

 

3,505

 

 

3,676

 

Net interest income

 

10,786

 

 

9,943

 

 

10,110

 

 

9,762

 

 

8,861

 

Provision for loan losses

 

900

 

 

1,350

 

 

1,100

 

 

1,050

 

 

 

Net interest income after provision

 

9,886

 

 

8,593

 

 

9,010

 

 

8,712

 

 

8,861

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

594

 

 

565

 

 

441

 

 

668

 

 

681

 

Bank card interchange fees

 

882

 

 

881

 

 

863

 

 

750

 

 

711

 

Bank owned life insurance income

 

99

 

 

113

 

 

116

 

 

96

 

 

96

 

Gain (loss) on sales and calls of securities, net

 

 

 

 

 

(5

)

 

 

 

 

Other

 

202

 

 

183

 

 

186

 

 

210

 

 

166

 

Non-interest income

 

1,777

 

 

1,742

 

 

1,601

 

 

1,724

 

 

1,654

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries & employee benefits

 

4,167

 

 

4,413

 

 

4,633

 

 

4,538

 

 

4,201

 

Occupancy and equipment

 

1,011

 

 

1,008

 

 

983

 

 

999

 

 

890

 

Professional fees

 

233

 

 

261

 

 

235

 

 

208

 

 

171

 

Marketing expense

 

177

 

 

134

 

 

104

 

 

214

 

 

218

 

FDIC insurance

 

81

 

 

81

 

 

67

 

 

 

 

 

Data processing expense

 

381

 

 

382

 

 

380

 

 

359

 

 

316

 

State franchise and deposit tax

 

395

 

 

360

 

 

360

 

 

360

 

 

265

 

Deposit account related expense

 

492

 

 

487

 

 

460

 

 

451

 

 

333

 

Other real estate owned expense

 

5

 

 

20

 

 

22

 

 

16

 

 

35

 

Litigation and loan collection expense

 

22

 

 

54

 

 

59

 

 

65

 

 

77

 

Communications expense

 

190

 

 

201

 

 

247

 

 

218

 

 

200

 

Insurance expense

 

112

 

 

102

 

 

111

 

 

103

 

 

109

 

Postage and delivery

 

151

 

 

156

 

 

152

 

 

168

 

 

140

 

Acquisition costs

 

 

 

 

 

 

 

 

 

775

 

Other

 

449

 

 

420

 

 

423

 

 

536

 

 

584

 

Non-interest expense

 

7,866

 

 

8,079

 

 

8,236

 

 

8,235

 

 

8,314

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

3,797

 

 

2,256

 

 

2,375

 

 

2,201

 

 

2,201

 

Income tax expense

 

680

 

 

190

 

 

393

 

 

361

 

 

437

 

Net income

$

3,117

 

$

2,066

 

$

1,982

 

$

1,840

 

$

1,764

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares – Basic

 

7,499,323

 

 

7,499,223

 

 

7,488,173

 

 

7,481,884

 

 

7,471,680

 

Weighted average shares – Diluted

 

7,499,323

 

 

7,499,223

 

 

7,488,173

 

 

7,481,884

 

 

7,471,680

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

$

0.42

 

$

0.28

 

$

0.26

 

$

0.25

 

$

0.24

 

Diluted earnings per common share

$

0.42

 

$

0.28

 

$

0.26

 

$

0.25

 

$

0.24

 

Cash dividends declared per common share

$

0.00

 

$

0.00

 

$

0.00

 

$

0.00

 

$

0.00

 

 

 
 

LIMESTONE BANCORP, INC.

Unaudited Financial Information

(in thousands, except share and per share data)

 

 

As of

 

 

 

12/31/20

 

9/30/20

 

6/30/20

 

 

3/31/20

 

 

12/31/19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans

$

962,081

 

$

974,468

 

$

975,759

 

$

961,561

 

$

926,271

 

Allowance for loan losses

 

(12,443

)

 

(11,481

)

 

(10,228

)

 

(9,150

)

 

(8,376

)

Net loans

 

949,638

 

 

962,987

 

 

965,531

 

 

952,411

 

 

917,895

 

Securities available for sale

 

203,862

 

 

203,544

 

 

202,596

 

 

198,657

 

 

209,000

 

Federal funds sold & interest-bearing deposits

 

56,863

 

 

24,358

 

 

39,027

 

 

23,639

 

 

21,962

 

Cash and due from financial institutions

 

10,830

 

 

7,593

 

 

9,990

 

 

9,509

 

 

8,241

 

Premises and equipment

 

18,533

 

 

18,572

 

 

19,000

 

 

19,282

 

 

19,658

 

Premises held for sale

 

1,060

 

 

1,110

 

 

1,149

 

 

1,185

 

 

900

 

Bank owned life insurance

 

23,441

 

 

23,347

 

 

16,238

 

 

16,128

 

 

16,037

 

FHLB Stock

 

5,887

 

 

5,962

 

 

6,142

 

 

6,837

 

 

6,237

 

Other real estate owned

 

1,765

 

 

1,625

 

 

1,625

 

 

3,225

 

 

3,225

 

Deferred taxes, net

 

25,714

 

 

26,540

 

 

27,054

 

 

28,208

 

 

27,765

 

Goodwill

 

6,252

 

 

6,252

 

 

6,252

 

 

6,252

 

 

6,252

 

Intangible assets

 

2,244

 

 

2,308

 

 

2,372

 

 

2,436

 

 

2,500

 

Accrued interest receivable and other assets

 

6,213

 

 

7,426

 

 

7,532

 

 

6,441

 

 

6,107

 

Total Assets

$

1,312,302

 

$

1,291,624

 

$

1,304,508

 

$

1,274,210

 

$

1,245,779

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Certificates of deposit

$

367,552

 

$

398,429

 

$

446,370

 

$

467,535

 

$

476,534

 

Interest checking

 

190,625

 

 

168,735

 

 

167,814

 

 

157,621

 

 

146,038

 

Money market

 

175,785

 

 

174,588

 

 

166,376

 

 

154,851

 

 

160,837

 

Savings

 

142,623

 

 

134,962

 

 

119,327

 

 

92,235

 

 

56,015

 

Total interest-bearing deposits

 

876,585

 

 

876,714

 

 

899,887

 

 

872,242

 

 

839,424

 

Demand deposits

 

243,022

 

 

217,675

 

 

224,901

 

 

185,658

 

 

187,551

 

Total deposits

 

1,119,607

 

 

1,094,389

 

 

1,124,788

 

 

1,057,900

 

 

1,026,975

 

FHLB advances

 

20,623

 

 

30,634

 

 

20,644

 

 

61,349

 

 

61,389

 

Junior subordinated debentures

 

21,000

 

 

21,000

 

 

21,000

 

 

21,000

 

 

21,000

 

Subordinated capital note

 

25,000

 

 

25,000

 

 

17,000

 

 

17,000

 

 

17,000

 

Senior debt

 

 

 

 

 

5,000

 

 

5,000

 

 

5,000

 

Accrued interest payable and other liabilities

 

10,048

 

 

8,315

 

 

7,020

 

 

7,450

 

 

8,665

 

Total liabilities

 

1,196,278

 

 

1,179,338

 

 

1,195,452

 

 

1,169,699

 

 

1,140,029

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

116,024

 

 

112,286

 

 

109,056

 

 

104,511

 

 

105,750

 

Total Liabilities and Stockholders’ Equity

$

1,312,302

 

$

1,291,624

 

$

1,304,508

 

$

1,274,210

 

$

1,245,779

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending shares outstanding

 

7,498,865

 

 

7,499,183

 

 

7,485,872

 

 

7,489,305

 

 

7,471,975

 

Book value per common share

$

15.47

 

$

14.97

 

$

14.57

 

$

13.95

 

$

14.15

 

Tangible book value per common share

 

14.34

 

 

13.83

 

 

13.42

 

 

12.79

 

 

12.98

 

 
 

LIMESTONE BANCORP, INC.

Unaudited Financial Information

(in thousands, except share and per share data)

 

 

As of

 

 

 

12/31/20

 

 

9/30/20

 

 

6/30/20

 

 

3/31/20

 

 

12/31/19

 

Average Balance Sheet Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

$

1,304,715

 

$

1,295,814

 

$

1,305,923

 

$

1,273,167

 

$

1,167,179

 

Loans

 

965,339

 

 

963,486

 

 

978,316

 

 

949,204

 

 

846,235

 

Earning assets

 

1,220,043

 

 

1,213,039

 

 

1,222,760

 

 

1,188,314

 

 

1,090,752

 

Deposits

 

1,115,985

 

 

1,111,865

 

 

1,116,420

 

 

1,052,944

 

 

982,991

 

Long-term debt and advances

 

67,280

 

 

65,769

 

 

75,259

 

 

105,407

 

 

73,695

 

Interest bearing liabilities

 

951,620

 

 

955,661

 

 

971,770

 

 

971,554

 

 

882,473

 

Stockholders’ equity

 

113,868

 

 

110,930

 

 

107,348

 

 

107,632

 

 

105,295

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarterly Performance Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets

 

0.95

%

 

0.63

%

 

0.61

%

 

0.58

%

 

0.60

%

Return on average equity

 

10.89

 

 

7.41

 

 

7.43

 

 

6.88

 

 

6.65

 

Yield on average earning assets (tax equivalent)

 

4.12

 

 

3.98

 

 

4.21

 

 

4.50

 

 

4.57

 

Cost of interest-bearing liabilities

 

0.76

 

 

0.90

 

 

1.11

 

 

1.45

 

 

1.65

 

Net interest margin (tax equivalent)

 

3.53

 

 

3.27

 

 

3.33

 

 

3.31

 

 

3.23

 

Efficiency ratio

 

62.61

 

 

69.14

 

 

70.30

 

 

71.70

 

 

71.70

 

Non-interest expense to average assets

 

2.40

 

 

2.48

 

 

2.54

 

 

2.60

 

 

2.83

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Quality Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans

$

1,676

 

$

2,038

 

$

1,410

 

$

1,500

 

$

1,528

 

Troubled debt restructurings on accrual

 

480

 

 

489

 

 

462

 

 

466

 

 

475

 

Loan 90 days or more past due still on accrual

 

 

 

 

 

 

 

 

 

 

Total non-performing loans

 

2,156

 

 

2,527

 

 

1,872

 

 

1,966

 

 

2,003

 

Real estate acquired through foreclosures

 

1,765

 

 

1,625

 

 

1,625

 

 

3,225

 

 

3,225

 

Other repossessed assets

 

 

 

 

 

 

 

 

 

 

Total non-performing assets

$

3,921

 

$

4,152

 

$

3,497

 

$

5,191

 

$

5,228

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing loans to total loans

 

0.22

%

 

0.26

%

 

0.19

%

 

0.20

%

 

0.22

%

Non-performing assets to total assets

 

0.30

 

 

0.32

 

 

0.27

 

 

0.41

 

 

0.42

 

Allowance for loan losses to non-performing loans

 

577.13

 

 

454.33

 

 

546.37

 

 

465.41

 

 

418.17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses to total loans

 

1.29

%

 

1.18

%

 

1.05

%

 

0.95

%

 

0.90

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan Charge-off Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans charged off

$

(124

)

$

(150

)

$

(193

)

$

(335

)

$

(639

)

Recoveries

 

186

 

 

53

 

 

171

 

 

59

 

 

111

 

Net recoveries (charge-offs)

$

62

 

$

(97

)

$

(22

)

$

(276

)

$

(528

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans by Risk Category

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pass

$

926,025

 

$

923,895

 

$

925,558

 

$

915,985

 

$

888,707

 

Watch

 

18,879

 

 

27,782

 

 

43,014

 

 

38,464

 

 

27,522

 

Special Mention

 

 

 

364

 

 

 

 

 

 

 

Substandard

 

17,177

 

 

22,427

 

 

7,187

 

 

7,112

 

 

10,042

 

Doubtful

 

 

 

 

 

 

 

 

 

 

Total

$

962,081

 

$

974,468

 

$

975,759

 

$

961,561

 

$

926,271

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans by Past Due Status

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Past due loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30 – 59 days

$

1,537

 

$

482

 

$

458

 

$

1,158

 

$

1,747

 

60 – 89 days

 

372

 

 

265

 

 

197

 

 

248

 

 

670

 

90 days or more

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans

 

1,676

 

 

2,038

 

 

1,410

 

 

1,500

 

 

1,528

 

Total past due and nonaccrual loans

$

3,585

 

$

2,785

 

$

2,065

 

$

2,906

 

$

3,945

 

 

 
 

LIMESTONE BANCORP, INC.

Unaudited Financial Information

(in thousands, except share and per share data)

 

 

As of

 

 

12/31/20

 

 

9/30/20

 

 

6/30/20

 

 

3/31/20

 

 

12/31/19

 

Risk-based Capital Ratios – Company

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tier I leverage ratio

 

8.24

%

 

8.17

%

 

8.05

%

 

8.29

%

 

8.30

%

Common equity Tier I risk-based capital ratio

 

8.72

 

 

8.54

 

 

8.45

 

 

8.26

 

 

8.32

 

Tier I risk-based capital ratio

 

9.67

 

 

9.77

 

 

9.93

 

 

9.86

 

 

9.32

 

Total risk-based capital ratio

 

13.14

 

 

13.22

 

 

12.57

 

 

12.37

 

 

11.85

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk-based Capital Ratios – Limestone Bank

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tier I leverage ratio

 

10.21

%

 

9.90

%

 

9.54

%

 

9.67

%

 

9.99

%

Common equity Tier I risk-based capital ratio

 

12.05

 

 

11.88

 

 

11.79

 

 

11.50

 

 

11.25

 

Tier I risk-based capital ratio

 

12.05

 

 

11.88

 

 

11.79

 

 

11.50

 

 

11.25

 

Total risk-based capital ratio

 

13.20

 

 

12.97

 

 

12.78

 

 

12.38

 

 

12.08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FTE employees, end of period

 

219

 

 

224

 

 

228

 

 

248

 

 

244

 

 
 

Non-GAAP Financial Measures Reconciliation

Tangible book value per common share is a non-GAAP financial measure derived from GAAP based amounts. Tangible book value is calculated by excluding the balance of intangible assets from common stockholders’ equity. Tangible book value per common share is calculated by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which is calculated by dividing common stockholders’ equity by common shares outstanding. Management believes this is consistent with bank regulatory agency treatment, which excludes tangible assets from the calculation of risk-based capital.

The efficiency ratio is a non-GAAP measure of expense control relative to revenue from net interest income and fee income. The efficiency ratio is calculated by dividing total non-interest expenses as determined under GAAP by net interest income and total non-interest income, but excluding from the calculation net gains on the sale of securities and expenses disclosed from time to time as non-recurring in nature. Management believes this provides a reasonable measure of primary banking expenses relative to primary banking revenue.

 

 

As of

 

 

 

12/31/20

 

 

9/30/20

 

 

6/30/20

 

 

3/31/20

 

 

12/31/19

 

Tangible Book Value Per Share

(in thousands, except share and per share data)

 

 

 

 

Common stockholders’ equity

$

116,024

 

$

112,286

 

$

109,056

 

$

104,511

 

$

105,750

 

Less: Goodwill

 

6,252

 

 

6,252

 

 

6,252

 

 

6,252

 

 

6,252

 

Less: Intangible assets

 

2,244

 

 

2,308

 

 

2,372

 

 

2,436

 

 

2,500

 

Tangible common equity

 

107,528

 

 

103,726

 

 

100,432

 

 

95,823

 

 

96,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares outstanding

 

7,498,865

 

 

7,499,183

 

 

7,485,872

 

 

7,489,305

 

 

7,471,975

 

Tangible book value per common share

$

14.34

 

$

13.83

 

$

13.42

 

$

12.79

 

$

12.98

 

Book value per common share

 

15.47

 

 

14.97

 

 

14.57

 

 

13.95

 

 

14.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

12/31/20

 

 

9/30/20

 

 

6/30/20

 

 

3/31/20

 

 

12/31/19

 

Efficiency Ratio

(in thousands)

 

 

 

 

Net interest income

$

10,786

 

$

9,943

 

$

10,110

 

$

9,762

 

$

8,861

 

Non-interest income

 

1,777

 

 

1,742

 

 

1,601

 

 

1,724

 

 

1,654

 

Less: Net gain (loss) on securities

 

 

 

 

 

(5

)

 

 

 

 

Revenue used for efficiency ratio

 

12,563

 

 

11,685

 

 

11,716

 

 

11,486

 

 

10,515

 

Non-interest expense

 

7,866

 

 

8,079

 

 

8,236

 

 

8,235

 

 

8,314

 

Less: Acquisition costs

 

 

 

 

 

 

 

 

 

775

 

Expenses used for efficiency ratio

 

7,866

 

 

8,079

 

 

8,236

 

 

8,235

 

 

7,539

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio

 

62.61

%

 

69.14

%

 

70.30

%

 

71.70

%

 

71.70

%