MIDDLETOWN, Md., Oct. 18, 2021 /PRNewswire/ -- Community Heritage Financial, Inc. ("the Company") (OTC Pink: CMHF), the parent company for Middletown Valley Bank ("MVB" or the "Bank") and Millennium Financial Group, Inc. ("Mlend"), announced today that for the period ending September 30, 2021 the Company earned year to date net income of $4.758 million or $2.11 per share, the highest for the time period in the history of the Company, with an increase of $2.2 million or 86% compared to September 30, 2020 at $2.560 million or $1.14 per share. Net income for the third quarter was $2.257 million or $1.00 per share, an increase of 153% or $1.4 million compared to second quarter net income of $892 thousand or $0.40 per share. Year over year third quarter net income increased $1.1 million or 88% compared to the third quarter of 2020.
Earnings continued to be bolstered by strong residential mortgage loan activity along with enhanced fee income from PPP loan forgiveness. Earnings were positively impacted during the third quarter by a loan charge-off recovery totaling $540 thousand related to the prior quarter isolated loan charge-off due to a COVID-19 business failure. The Bank entered into a forbearance agreement with the principal of the aforementioned credit charge-off to receive monthly restitution towards the recovery of the charge-off. The recovery also positively impacted the provision expense for the third quarter, resulting in a loan loss provision expense release of $246 thousand. As of September 30, 2021 the Company's credit quality continued to be strong with non-performing assets to total assets at 0.31%, a decrease of 5 basis points from the prior quarter.
The Company remains deeply committed to the communities we serve. We continue to expand our newly formed footprint in the Franklin County, PA market and continuing to grow in the Maryland market while providing our customers with "Absolutely Exceptional Experiences".
Quarterly Highlights ? 3Q21 vs 2Q21
Quarterly Highlights ? 3Q21 vs 3Q20
Dividend
A dividend of $0.04 per share was declared by the Board of Directors on October 18, 2021 for shareholders of record as of October 29, 2021 and payable on November 5, 2021.
Community Heritage Financial, Inc.
Robert E. (BJ) Goetz, Jr.
President & Chief Executive Officer
301-371-305
Community Heritage Financial, Inc. and Subsidiaries | |||||||||||
Consolidated Balance Sheets | |||||||||||
(dollars in thousands) | |||||||||||
September 30, | June 30, | March 31, | December 31, | September 30, | |||||||
2021 | 2021 | 2021 | 2020 | 2020 | |||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Audited) | (Unaudited) | |||||||
Assets | |||||||||||
Cash and due from banks | $ | 55,559 | $ | 49,830 | $ | 43,425 | $ | 28,785 | $ | 15,044 | |
Total cash and cash equivalents | 55,559 | 49,830 | 43,425 | 28,785 | 15,044 | ||||||
Securities available-for-sale, at fair value | 130,431 | 86,343 | 61,086 | 72,439 | 67,441 | ||||||
Equity securities, at cost | 338 | 338 | 462 | 462 | 462 | ||||||
Loans | 570,727 | 569,877 | 585,811 | 558,967 | 554,851 | ||||||
Less allowance for loan loss | 6,071 | 5,812 | 8,948 | 7,480 | 6,024 | ||||||
Loans, net | 564,655 | 564,065 | 576,864 | 551,486 | 548,828 | ||||||
Loans held for sale | 7,963 | 8,008 | 10,717 | 12,626 | 21,670 | ||||||
Premises and equipment, net | 6,858 | 7,025 | 6,529 | 6,400 | 6,459 | ||||||
Right-of-use assets | 2,417 | 2,533 | 2,557 | 2,667 | 2,785 | ||||||
Accrued interest receivable | 1,738 | 1,746 | 2,035 | 2,199 | 2,192 | ||||||
Deferred tax assets | 2,007 | 1,873 | 3,025 | 2,081 | 1,796 | ||||||
Bank-owned life insurance | 6,443 | 6,393 | 6,340 | 5,280 | 5,214 | ||||||
Goodwill | 1,657 | 1,657 | 1,657 | 1,657 | 1,657 | ||||||
Intangible assets | 3 | 5 | 7 | 9 | 11 | ||||||
Other Assets | 1,715 | 1,590 | 1,750 | 2,090 | 1,960 | ||||||
Total Assets | $ | 781,783 | $ | 731,404 | $ | 716,452 | $ | 688,181 | $ | 675,519 | |
Liabilities and Stockholders' Equity | |||||||||||
Liabilties | |||||||||||
Deposits: | |||||||||||
Non-interest-bearing demand | $ | 254,058 | $ | 233,757 | $ | 228,946 | $ | 197,297 | $ | 187,972 | |
Interest-bearing | 444,488 | 417,157 | 405,499 | 402,262 | 399,955 | ||||||
Total Deposits | 698,546 | 650,914 | 634,445 | 599,560 | 587,927 | ||||||
Subordinated debt, net | 14,731 | 14,708 | 14,686 | 14,664 | 14,641 | ||||||
Other borrowings | 2,629 | 4,015 | 3,719 | 8,558 | 10,577 | ||||||
Lease liabilities | 2,480 | 2,591 | 2,610 | 2,715 | 2,823 | ||||||
Accrued interest payable | 409 | 206 | 426 | 215 | 445 | ||||||
Other liabilities | 7,099 | 4,416 | 7,349 | 9,509 | 7,532 | ||||||
Total Liabilities | 725,895 | 676,850 | 663,236 | 635,221 | 623,946 | ||||||
Stockholders' Equity | |||||||||||
Common stock | 23 | 23 | 23 | 23 | 23 | ||||||
Surplus | 28,523 | 28,523 | 28,523 | 28,523 | 28,523 | ||||||
Retained earnings | 28,121 | 25,954 | 25,152 | 23,633 | 22,156 | ||||||
Accumulated other comprehensive income (loss) | (779) | 54 | (482) | 782 | 870 | ||||||
Total Stockholders' Equity | 55,888 | 54,554 | 53,216 | 52,960 | 51,572 | ||||||
Total Liabilities and Stockholders' Equity | $ | 781,783 | $ | 731,404 | $ | 716,452 | $ | 688,181 | $ | 675,519 |
Community Heritage Financial, Inc. and Subsidiaries | |||||||||||
Consolidated Statements of Income | |||||||||||
(Unaudited) | |||||||||||
Three Months Ended | Nine Months Ended | ||||||||||
September 30, | June 30, | September 30, | September 30, | September 30, | |||||||
2021 | 2021 | 2020 | 2021 | 2020 | |||||||
Interest Income | |||||||||||
Loans, including fees | $ | 6,407,015 | $ | 6,328,253 | $ | 5,811,942 | $ | 19,241,739 | $ | 16,623,282 | |
Securities | 436,526 | 347,943 | 304,912 | 1,088,144 | 766,457 | ||||||
Fed funds sold and other | 26,859 | 5,115 | 29,246 | 40,685 | 139,341 | ||||||
Total interest income | 6,870,400 | 6,681,311 | 6,146,099 | 20,370,568 | 17,529,080 | ||||||
Interest Expense | |||||||||||
Deposits | 427,313 | 442,650 | 728,081 | 1,370,982 | 2,733,798 | ||||||
Borrowed funds | - | - | - | 947 | 48,869 | ||||||
Subordinated debt | 238,049 | 238,049 | 238,049 | 714,148 | 709,356 | ||||||
Other Interest Expense | 45,323 | 51,071 | 66,878 | 167,822 | 106,766 | ||||||
Total interest expense | 710,686 | 731,770 | 1,033,009 | 2,253,900 | 3,598,789 | ||||||
Net interest income | 6,159,714 | 5,949,541 | 5,113,091 | 18,116,668 | 13,930,292 | ||||||
Provision for loan losses | (245,988) | 1,432,697 | 844,521 | 2,652,690 | 1,796,018 | ||||||
Net interest income after provision for loan losses | 6,405,702 | 4,516,844 | 4,268,570 | 15,463,978 | 12,134,274 | ||||||
Non-interest income | |||||||||||
Service charges on deposits | 180,225 | 181,006 | 164,660 | 555,060 | 448,491 | ||||||
Earnings bank owned life insurance | 40,956 | 45,307 | 46,771 | 137,952 | 90,314 | ||||||
Gain sale of fixed assets | - | - | - | 1,500 | - | ||||||
Gain sale of securities | - | - | 164,464 | 196,091 | 173,721 | ||||||
Mortage loan income activity | 1,252,561 | 1,313,885 | 1,973,960 | 4,026,646 | 3,929,716 | ||||||
Other non-interest income | 211,864 | 200,732 | 155,515 | 585,771 | 411,106 | ||||||
Total non-interest income | 1,685,606 | 1,740,930 | 2,505,370 | 5,503,020 | 5,053,348 | ||||||
Non-interest expense | |||||||||||
Salaries and employee benefits | 2,967,511 | 2,880,755 | 3,133,762 | 8,430,445 | 8,219,404 | ||||||
Occupancy and equipment | 708,358 | 706,167 | 694,331 | 2,091,761 | 2,057,023 | ||||||
Legal and professional fees | 155,208 | 169,242 | 200,451 | 474,478 | 529,262 | ||||||
Advertising | 130,244 | 131,225 | 96,098 | 417,594 | 318,435 | ||||||
Data processing | 544,371 | 625,055 | 504,575 | 1,637,675 | 1,414,085 | ||||||
FDIC premiums | 93,840 | 108,963 | 106,675 | 317,599 | 159,155 | ||||||
Loss sale of securities | - | - | - | 17,826 | - | ||||||
Other intangible amortization | 2,083 | 2,083 | 2,083 | 6,250 | 6,250 | ||||||
Other | 412,142 | 377,273 | 413,694 | 1,008,063 | 1,050,041 | ||||||
Total non-interest expense | 5,013,757 | 5,000,763 | 5,151,169 | 14,401,691 | 13,753,155 | ||||||
Income before taxes | 3,077,551 | 1,257,011 | 1,622,771 | 6,565,308 | 3,434,467 | ||||||
Income tax expense | 820,160 | 365,343 | 421,791 | 1,807,083 | 874,233 | ||||||
Net Income | $ | $2,257,391 | $ | $891,668 | $ | $1,200,980 | $ | $4,758,225 | $ | $2,560,234 | |
Basic earnings per share | $ | 1.00 | $ | 0.40 | $ | 0.53 | $ | 2.11 | $ | 1.14 |
Community Heritage Financial, Inc. and Subsidiaries | ||||||||||
Selected Financial Data | ||||||||||
Income Statement Review | ||||||||||
For the Three Months Ended | For theNine Months Ended | |||||||||
September 30, | June 30, | September 30, | September 30, | September 30, | ||||||
2021 | 2021 | 2020 | 2021 | 2020 | ||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||
Interest Income | $ | 6,870,400 | $ | 6,681,311 | $ | 6,146,099 | $ | 20,370,568 | $ | 17,529,080 |
Interest Expense | 710,686 | 731,770 | 1,033,009 | 2,253,900 | 3,598,789 | |||||
Net interest income | 6,159,714 | 5,949,541 | 5,113,091 | 18,116,668 | 13,930,292 | |||||
Provsion expense | (245,988) | 1,432,697 | 844,521 | 2,652,690 | 1,796,018 | |||||
Net interest income after provision | $ | 6,405,702 | $ | 4,516,844 | $ | 4,268,570 | $ | 15,463,978 | $ | 12,134,274 |
Non-interest income | $ | 1,685,606 | $ | 1,740,930 | $ | 2,505,370 | $ | 5,503,020 | $ | 5,053,348 |
Non-interest expense | 5,013,757 | 5,000,763 | 5,151,169 | 14,401,691 | 13,753,156 | |||||
Merger expenses | - | - | - | - | - | |||||
Yield on interest-earning assets | 3.71% | 3.85% | 3.85% | 3.88% | 3.94% | |||||
Cost of interest-bearing liabilities | 0.63% | 0.69% | 0.97% | 0.70% | 1.20% | |||||
Efficiency ratio | 63.91% | 65.03% | 67.61% | 60.97% | 72.41% | |||||
Balance Sheet Review | ||||||||||
September 30, | June 30, | September 30, | ||||||||
2021 | 2021 | 2020 | ||||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||||
(dollars in thousands) | ||||||||||
Total assets | $ | 781,783 | $ | 731,404 | $ | 675,519 | ||||
Loans, net of reserve | 564,655 | 564,065 | 548,828 | |||||||
Goodwill & intangibles | 1,660 | 1,661 | 1,668 | |||||||
Deposits | 698,546 | 650,914 | 587,927 | |||||||
Shareholder's equity | 55,888 | 54,554 | 51,572 | |||||||
Asset Quality Review | ||||||||||
Non-accrual loans | $ | 1,471 | $ | 1,656 | $ | 1,246 | ||||
Trouble debt restructured loans still accruing | 963 | 969 | 681 | |||||||
Loans 90 days past due still accruing | - | - | 294 | |||||||
Foreclosured properties | - | - | - | |||||||
Total non-performing assets | $ | 2,434 | $ | 2,625 | $ | 2,221 | ||||
Non-performing assets to total assets | 0.31% | 0.36% | 0.33% | |||||||
Non-performing assets to total loans | 0.42% | 0.46% | 0.40% | |||||||
Summary of Operating Results | ||||||||||
For theThree Months Ended | For the Nine Months Ended | |||||||||
September 30, | September 30, | September 30, | September 30, | |||||||
2021 | 2020 | 2021 | 2020 | |||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||
Pre-allowance for Loan Loss provision, pre-tax net income | $ | 2,831,563 | $ | 2,467,292 | $ | 9,217,998 | $ | 5,230,485 | ||
Alllowance for loan loss provision, pre-tax | (245,988) | 844,521 | 2,652,690 | 1,796,018 | ||||||
Tax expense | 820,160 | 421,791 | 1,807,083 | 874,233 | ||||||
Net Income | $ | 2,257,391 | $ | 1,200,980 | $ | 4,758,225 | $ | 2,560,234 | ||
(dollars in thousands) | ||||||||||
Charge-offs | $ | 54 | $ | 12 | $ | 4,655 | $ | 49 | ||
(Recoveries) | (550) | (9) | (578) | (29) | ||||||
Net charge-offs | $ | (496) | $ | 3 | $ | 4,077 | $ | 20 | ||
Per Common Share Data | ||||||||||
Common shares outstanding | 2,251,320 | 2,251,320 | 2,251,320 | 2,251,320 | ||||||
Weighted average shares outstanding | 2,251,320 | 2,251,320 | 2,251,320 | 2,251,320 | ||||||
Basic Earnings per share | $ | 1.00 | $ | 0.53 | $ | 2.11 | $ | 1.14 | ||
Dividend declared | $ | 0.04 | $ | 0.04 | $ | 0.12 | $ | 0.12 | ||
Book value per share | $ | 24.82 | $ | 22.91 | $ | 24.82 | $ | 22.91 | ||
Tangible book value per share | $ | 24.09 | $ | 11.17 | $ | 24.09 | $ | 22.17 | ||
Selected Financial Ratios (unaudited) | ||||||||||
Return on average assets | 1.18% | 0.72% | 0.87% | 0.55% | ||||||
Return on average equity | 15.79% | 9.26% | 11.38% | 6.79% | ||||||
Allowance for loan losses to total loans | 1.06% | 1.09% | 1.06% | 1.09% | ||||||
Allowance for loan loss to total loans (excluding PPP loans) | 1.10% | 1.23% | 1.10% | 1.23% | ||||||
Non-performing assets to total loans | 0.42% | 0.40% | 0.42% | 0.40% | ||||||
Non-performing assets to total loans (excluding PPP) | 0.44% | 0.45% | 0.44% | 0.45% | ||||||
Net Charge-offs to total loans | -0.09% | 0.00% | 0.71% | 0.00% | ||||||
Common equity tier 1 (CET1) capital | 10.74% | N/A | 10.74% | N/A | ||||||
Tier1 capital | 10.74% | N/A | 10.74% | N/A | ||||||
Total risk based capital | 11.88% | N/A | 11.77% | N/A | ||||||
Tier-1 leverage ratio | 8.86% | N/A | 8.86% | N/A | ||||||
Community bank leverage ratio (bank only)** | N/A | 9.24% | N/A | 9.24% | ||||||
Average equity to average assets | 7.49% | 7.73% | 7.65% | 8.05% | ||||||
Tangible Common Equity/Tangible Common Assets | 6.95% | 7.25% | 6.95% | 7.25% | ||||||
Net interest margin (bank only, normalized)* | 3.40% | 3.52% | 3.47% | 3.53% | ||||||
Loans to deposits - (EOP) | 81.70% | 94.37% | 81.70% | 94.37% | ||||||
*Normalized margin excludes impact of PPP loans and related on balance sheet liquidity through Brokered deposits and FHLB Borrowing | ||||||||||
**As of September 30, 2021 the bank reverted back to the BASEL III regulatory framework for capital reporting and discontinued the CBLR calculation. |
SOURCE Community Heritage Financial, Inc.
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