Lewis & Clark Bancorp (OTC Pink: LWCL) announces 2021 third quarter and year to date consolidated results. Quarter to date net income totaled $1,299,000 for the three months ended September 30, 2021, an increase of $980,000 compared to $319,000 for the same period last year. Earnings per share were $1.21 for the current year quarter, compared to $0.28 for the prior year quarter. Year to date net income totaled $3,243,000 an increase of $2,181,000 compared to $1,062,000 for the same period last year. Earnings per share were $2.94 for the current year period, compared to $0.94 for the prior year period.

The increased earnings in the current year quarter were due to an increase in both net interest income and noninterest income, and a decrease in the provision for loan losses, partially offset by increases in both noninterest expense and the provision for income taxes compared to the same period one year ago. The increase in net interest income is due to an increase in interest and fees on loans primarily related to increased interest and fees earned from the SBA Paycheck Protection Program (PPP) loans and a decrease in interest expense on deposits due to lower cost of funds. These favorable variances were partially offset by an increase in interest expense on borrowings due to the subordinated debt issued in the prior year. The increase in noninterest income was due to an increase in both interchange fees and earnings from bank owned life insurance. The decrease in the provision for loan losses was due to Management’s assessment of risk factors related to the ongoing COVID-19 pandemic and improved qualitative risk factors compared to the prior year. The increase in noninterest expense was due to increases in salaries and employee benefits, data processing, FDIC assessment fees, business related travel expenses, and bank service charges, partially offset by declines in both professional fees and intangible amortization. The increase in the provision for income taxes was due to increased pre-tax earnings compared to the prior year period.

The increased earnings in the current year period were due to an increase in net interest income and a decrease in the provision for loan losses, partially offset by a decrease in noninterest income and increases in both noninterest expense and the provision for income taxes compared to the same period one year ago. The increase in net interest income is due to an increase in interest and fees on loans primarily related to increased interest and fees earned from the SBA Paycheck Protection Program (PPP) loans and a decrease in interest expense on deposits due to lower cost of funds. These favorable variances were partially offset by an increase in interest expense on borrowings due to the subordinated debt issued in the prior year, and a decrease in interest earned on interest bearing cash balances and investments. The decrease in the provision for loan losses was substantially the same as that for the current year quarter as previously discussed. The decrease in noninterest income was due to recording a gain on the liquidation of the securities portfolio in the prior year, partially offset by increases in interchange fees, earnings from bank owned life insurance, and unrealized gains on equity securities. The increase in noninterest expense was due to increases in salaries and employee benefits, occupancy expense, FDIC assessment fees, software license and maintenance fees, employee education and bank service charges. These increases were partially offset by decreases in data processing, professional fees, and amortization for intangible assets.

Jeffrey Sumpter, President and CEO commented, “We are pleased to report increased earnings during the current year period and strong balance sheet growth primarily as a result of increased deposits. We are also pleased to report that we have paid 22 consecutive quarters of shareholder dividends.” Sumpter continued, “Although we have experienced record earnings during the current year, aided by interest and fees on PPP loans, we expect that the ongoing economic uncertainties will impact our performance as we move forward, and although loan demand is steady it has not yet returned to pre-pandemic levels largely due to government stimulus programs, excess borrower liquidity, and supply chain disruptions."

As of September 30, 2021, total consolidated assets were $427.3 million, an increase of $81.0 million, or 23.4%, compared to December 31, 2020. This increase was primarily due to increases in cash, investment securities and total deposits, partially offset by a decline in gross loans and borrowings compared to the balances reported at December 31, 2020. Cash increased by $100.7 million, primarily due to an increase in total deposits and a decrease in gross loans, partially offset by an increase in investment securities and the repayment of borrowings. Investment securities increased by $32.0 million primarily due to management’s decision to deploy excess liquidity into higher yielding assets compared to holding cash. Total deposits increased $85.6 million due to increases in noninterest-bearing and interest-bearing demand deposits, related to the PPP loans, money market and savings deposits, and time deposits. Total gross loans decreased $55.8 million substantially due to $97.6 million in forgiveness related to the PPP loans and principal reductions on existing loans partially offset by originating $44.7 million in new PPP loans. Borrowings decreased $5.9 million due to the repayment of funding provided through the Federal Reserve’s Paycheck Protection Program Liquidity Facility. Shareholders’ equity totaled $38.0 million at September 30, 2021, an increase of $1,100,000, compared to December 31, 2020. The increase was due to earnings of $3,243,000, partially offset by the Company repurchasing $1,897,000 of stock during the current year related to the Company’s share repurchase program, and shareholder dividends totaling $251,000.

About Lewis & Clark Bancorp

Headquartered in Oregon City, Oregon, Lewis & Clark Bancorp is the holding company for Lewis & Clark Bank, a state-chartered full-service commercial bank. Partnering with people and businesses throughout Oregon and SW Washington, the Bank believes that being an integral part of the community it serves, helps promote both growth and success.

For more information about Lewis & Clark Bank, visit www.lewisandclarkbank.com.

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