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Evans Bancorp Reports Net Income of $24.5 Million in 2023

Evans Bancorp, Inc. (the “Company” or “Evans”) (NYSE American: EVBN), a community financial services company serving Western New York since 1920, today reported results of operations for the fourth quarter and full year ended December 31, 2023.

HIGHLIGHTS

  • Completed the sale of The Evans Agency (“TEA”) to Arthur J. Gallagher & Co, netting a pretax gain of $20.2 million in the fourth quarter
  • Repositioned balance sheet with sale of $78 million of investment securities – proceeds used to reduce short-term borrowings; resulted in recognized pretax loss of $5.0 million in the quarter but improves forward net interest income
  • Total loan balances of $1.7 billion up 1% in the quarter and 3% year-over-year
  • Fourth quarter net interest margin of 2.75% declined 4 basis points sequentially
  • Tangible book value per share increased 25% to $32.07 at December 31, 2023 compared with prior year’s fourth quarter
  • Paid dividends of $1.32 per share in 2023, up 5%

Net income was $10.2 million, or $1.85 per diluted share, in the fourth quarter of 2023, compared with $3.6 million, or $0.66 per diluted share, in the third quarter of 2023 and $6.0 million, or $1.10 per diluted share, in last year’s fourth quarter. On November 30, 2023, the Company sold The Evans Agency to Arthur J. Gallagher & Co., and recognized a pretax gain of $20.2 million. In addition, the Company strategically repositioned its balance sheet by selling $78 million of investment securities, primarily available-for-sale U.S. Treasuries and government-sponsored agency securities, and used the proceeds to pay down short-term borrowings. This action resulted in $5.0 million of pretax losses on investment securities during the fourth quarter of 2023 with expected positive forward impact on net interest income. Return on average equity was 25.73% for the fourth quarter of 2023, compared with 9.06% in the third quarter of 2023 and 16.07% in the fourth quarter of 2022.

For the full year of 2023, net income increased 10% to $24.5 million, or $4.48 per diluted share, compared with $22.4 million, or $4.04 per diluted share, in 2022. The increase mainly reflected the gain on sale of the insurance agency partially offset by lower net interest income and loss on investment securities. Allowance for credit losses was reduced by $2.7 million from the prior year as a result of improving economic factors, including peer metrics, and a $1.5 million charge-off of a single commercial loan during 2022. The return on average equity was 15.47% for 2023 compared with 13.49% in 2022.

“Evans’ performance in 2023 was characterized by resiliency,” commented David J. Nasca, President and CEO of Evans Bancorp, Inc. “With a backdrop of interest rate pressure and macro-economic factors such as inflation, potential recession and liquidity demands, the dedicated work of the entire Evans team successfully protected and served client relationships, and maintained funding and liquidity. Actions were also taken to control costs, deliver efficiencies, and improve customer experience with investments in technology and process improvements.

“During the fourth quarter, we executed two strategic initiatives. The sale of The Evans Agency resulted in significant value creation including measurable growth in our tangible book value with an after-tax gain of approximately $13 million and elimination of almost $12 million of goodwill and other intangibles. The proceeds from the transaction strengthened capital which allows flexibility to strategically redeploy back into our core banking franchise, including the restructure in our balance sheet which was completed in the fourth quarter to reduce lower yielding investment assets and reduce borrowings which we expect to improve returns in 2024.”

Net Interest Income

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4Q 2023

 

 

3Q 2023

 

 

4Q 2022

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

25,205

 

 

$

24,292

 

 

$

22,381

Interest expense

 

 

11,259

 

 

 

10,036

 

 

 

3,167

Net interest income

 

 

13,946

 

 

 

14,256

 

 

 

19,214

Provision for credit losses

 

 

282

 

 

 

506

 

 

 

923

Net interest income after provision

 

$

13,664

 

 

$

13,750

 

 

$

18,291

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income of $13.9 million was down $0.3 million, or 2%, from the third quarter and $5.3 million, or 27%, from last year’s fourth quarter as a result of higher interest expense related to the increased cost of interest-bearing liabilities produced by competitive pricing on deposits.

Fourth quarter net interest margin of 2.75% declined 4 basis points from the trailing third quarter and 102 basis points from the prior-year period. The yield on loans increased 18 basis points compared with the third quarter and 55 basis points year-over-year. The cost of interest-bearing liabilities was 2.87% compared with 2.59% in the third quarter of 2023 and 0.86% in the fourth quarter of 2022.

The $0.3 million provision for credit losses in the current quarter was due to loan growth and higher reserves on individually analyzed loans, partially offset by improving economic factors, including peer group metrics.

Asset Quality

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4Q 2023

 

 

3Q 2023

 

 

4Q 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total non-performing loans

 

$

27,325

 

 

$

27,311

 

 

$

24,728

 

Total net loan charge-offs

 

 

11

 

 

 

35

 

 

 

115

 

Non-performing loans / Total loans

 

 

1.59

%

 

 

1.60

%

 

 

1.48

%

Net loan charge-offs / Average loans

 

 

-

%

 

 

0.01

%

 

 

0.03

%

Allowance for loan losses / Total loans

 

 

1.28

%

 

 

1.28

%

 

 

1.16

%

“The transaction to restructure the balance sheet reduces a portion of the Bank’s liability sensitivity, increases future net interest income, and has just over a two-year payback after paying down higher rate borrowings,” commented John Connerton, Chief Financial Officer of Evans Bank. “We remain focused on growing consumer and commercial core deposits, and while our deposit levels saw some contraction during the quarter, a large component was attributable to normal commercial and municipal deposit seasonality. We believe we are managing the current rate environment well by retaining key relationships, which along with capital growth puts us in a favorable position.”

Non-Interest Income

($ in thousands)

 

 

4Q 2023

 

 

3Q 2023

 

 

4Q 2022

 

 

 

 

 

 

 

 

 

 

 

 

Deposit service charges

 

$

670

 

 

$

665

 

 

$

684

Insurance service and fee revenue

 

 

1,613

 

 

 

3,498

 

 

 

2,204

Bank-owned life insurance

 

 

230

 

 

 

239

 

 

 

221

Interchange fee income

 

 

510

 

 

 

516

 

 

 

507

Gain on sale of insurance agency

 

 

20,160

 

 

 

-

 

 

 

-

Loss on sale of investment securities

 

 

(5,044)

 

 

 

-

 

 

 

-

Other income

 

 

412

 

 

 

638

 

 

 

845

Total non-interest income

 

$

18,551

 

 

$

5,556

 

 

$

4,461

 

 

 

 

 

 

 

 

 

 

 

 

Excluding the fourth quarter’s one-time transactions relating to the gain on the sale of TEA and loss on sale of securities, non-interest income would have been $3.4 million.

Insurance service and fee revenue of $1.6 million reflects two months of revenue earned by TEA. Insurance service and fee revenue was also higher in the third quarter of 2023 due to premium seasonality.

Other income decreased $0.2 million from the third quarter of 2023 due to a decrease in value of mortgage servicing rights. The decrease from last year’s fourth quarter was primarily due to a $0.2 million gain on sale of an asset that was acquired in foreclosure and sold in the fourth quarter of 2022, and also included $0.2 million of revenue recognized relating to rents received from the acquired asset prior to the sale.

Non-Interest Expense

($ in thousands)

 

 

4Q 2023

 

 

3Q 2023

 

 

4Q 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

$

10,251

 

 

$

8,735

 

 

$

9,498

 

Occupancy

 

 

1,078

 

 

 

1,109

 

 

 

1,190

 

Advertising and public relations

 

 

296

 

 

 

348

 

 

 

125

 

Professional services

 

 

1,003

 

 

 

869

 

 

 

871

 

Technology and communications

 

 

1,545

 

 

 

1,517

 

 

 

1,437

 

Amortization of intangibles

 

 

67

 

 

 

100

 

 

 

100

 

FDIC insurance

 

 

350

 

 

 

350

 

 

 

250

 

Other expenses

 

 

1,710

 

 

 

1,379

 

 

 

1,429

 

Total non-interest expenses

 

$

16,300

 

 

$

14,407

 

 

$

14,900

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total non-interest expense increased $1.9 million, or 13%, from the third quarter of 2023, and $1.4 million, or 9%, from last year’s fourth quarter.

Salaries and employee benefits increased $1.5 million, or 17%, from the sequential quarter, largely due to higher incentive accruals of $2.2 million, partially offset by reduced staff expenses including former insurance employees. The increase from the prior year’s fourth quarter was due to higher incentive accruals of $1.6 million, partially offset by a reduction of staff expenses through consolidation of branches, back-office operations, and sale of TEA.

The increase in other expenses compared with both comparative periods was due to $0.3 million of charitable contributions made during the current quarter.

The Company’s GAAP efficiency ratio, or noninterest expenses divided by the sum of net interest income and noninterest income, was 50.2% in the fourth quarter of 2023, 72.7% in the third quarter of 2023, and 62.9% in the fourth quarter of 2022.

Income tax expense was $5.7 million, for an effective tax rate of 36.1%, in the fourth quarter of 2023 compared with 26.2% in the third quarter of 2023 and 23.0% in last year’s fourth quarter. The elevated tax rate in the 2023 fourth quarter reflected the sale of TEA which included significant non-deductible goodwill expense.

Balance Sheet Highlights

Total assets were $2.11 billion as of December 31, 2023, a decrease of $66 million, or 3% since September 30, 2023, and $69 million, or 3% since December 31, 2022. The change from comparative periods was due to the sale of investment securities, partially offset by an increase in loan balances. Loan balances increased $17 million, or 1%, during the fourth quarter and reflected higher commercial real estate loans of $13 million and residential mortgages of $3 million. Since December 31, 2022, loan balances increased $49 million, or 3%, due to higher commercial real estate loans of $73 million and residential mortgages of $3 million, partially offset by a decrease in commercial and industrial loans of $27 million.

Investment securities were $278 million at December 31, 2023, $59 million lower than the end of the third quarter of 2023 and $94 million lower than the end of last year’s fourth quarter. The decrease reflects the strategic decision to sell $78 million of investment securities as well as changes in unrealized gains and losses on investment securities and maturities within the available-for-sale investment portfolio. The primary objectives of the Company’s investment portfolio are to provide liquidity, secure municipal deposits, and maximize income while preserving the safety of principal. The Company has the positive intent and ability to hold the remaining portfolio through recovery of value.

Total deposits of $1.72 billion decreased $87 million, or 5%, from September 30, 2023, and were down $53 million, or 3%, from the end of last year’s fourth quarter. The change from the sequential quarter largely reflected typical seasonal outflows from commercial and municipal relationships. From a product perspective, deposit decreases were in demand deposits of $57 million, municipal savings of $29 million, commercial savings of $14 million, consumer savings of $7 million, and consumer time deposits of $1 million. Offsetting those decreases were higher NOW deposits of $21 million.

While the Company has not experienced a significant outflow of deposits, in the event of such occurrences, it has access to alternate sources of funding to meet withdrawal demands. As of December 31, 2023, Evans had $53 million in overnight borrowings at the FHLB. Given the current collateral available at FHLB, advances up to $364 million can be drawn on the FHLB via the Company’s overnight line of credit. Additionally, Evans has the ability to borrow from the Federal Reserve and participates in the Bank Term Funding Program. At December 31, 2023, Evans had $86 million in short-term borrowings with the Federal Reserve and $8 million in additional availability to borrow against collateral.

Capital Management

The Company has consistently maintained regulatory capital ratios measurably above the Federal “well capitalized” standard, including a Tier 1 leverage ratio of 10.37% at December 31, 2023 compared with 9.40% at September 30, 2023 and 9.13% at December 31, 2022.

Book value per share was $32.40 at December 31, 2023 compared with $27.52 at September 30, 2023 and $28.32 at December 31, 2022. Reflected in the book value changes are the Federal Reserve’s aggressive interest rate hikes that have resulted in significant unrealized losses on investment securities. As of December 31, 2023 this amounted to $7.41 per share impact to book value. Such unrealized gains and losses are due to changes in interest rates and represent the difference, net of applicable income tax effect, between the estimated fair value and amortized cost of investment securities classified as available-for-sale.

Tangible book value per share was $32.07 at December 31, 2023 compared with $25.04 at September 30, 2023 and $25.76 at December 31, 2022.

For the full year of 2023, cash dividends totaled $1.32 per share, up 5% over 2022.

2023 Year in Review (compared with prior-year)

Net interest income was $61.2 million, down 16%. The yield on loans increased 86 basis points while competition on deposits and changes in customer behaviors contributed to the 189 basis points increase in cost of funds during 2023. Net interest margin was 3.02%, a decrease of 51 basis points.

The Company’s provision for credit loss was less than $0.1 million, which reflected improving economic conditions, including peer group metrics, partially offset by loan growth and specific reserve related individually analyzed loans. Provision for loan loss in 2022 included a $1.5 million charge-off of a single commercial loan and loan growth, partially offset by a decrease of criticized loans. The ratio of non-performing loans to total loans was 1.59% compared with 1.48% in 2022.

Non-interest income was up $13.7 million to $32.9 million. The increase was due to the gain on sale of the insurance agency of $20.2 million, partially offset by loss on sale of investment securities of $5 million, reduced bank services charges of $0.3 million, and lower insurance service and fee revenue of $0.2 million. Included in non-interest income during 2022 was a gain on sale of an asset that was acquired in foreclosure of $0.2 million, as well as $0.2 million of revenue recognized relating to rents received from the acquired asset and a $0.2 million final payment in connection with a historic tax credit investment.

Non-interest expense decreased $0.6 million, or 1%, to $59.4 million. Current year decreases included salaries and employee benefits of $1.8 million and loan expenses of $0.3 million, partially offset by higher technology and communication expenses of $0.8 million, charitable contributions of $0.3 million, and FDIC insurance expense of $0.4 million.

The Company’s GAAP efficiency ratio was 63.1% in 2023 compared with 65.0% in 2022.

Income tax expense for the year was $10.2 million, representing an effective tax rate of 29.4% compared with an effective tax rate of 24.2% in 2022.

Webcast and Conference Call

The Company will host a conference call and webcast on Thursday, February 1, 2024 at 4:45 p.m. ET. Management will review the financial and operating results for the fourth quarter and full year of 2023, as well as the Company’s strategy and outlook. A question and answer session will follow.

The conference call can be accessed by calling (201) 689-8471. Alternatively, the webcast can be monitored at www.evansbancorp.com.

A telephonic replay will be available from 8:00 p.m. ET on the day of the teleconference until Thursday, February 15, 2024. To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13743382, or access the webcast replay at www.evansbancorp.com, where a transcript will be posted once available.

About Evans Bancorp, Inc.

Evans Bancorp, Inc. is a financial holding company and the parent company of Evans Bank, N.A., a commercial bank with $2.1 billion in assets and $1.7 billion in deposits at December 31, 2023. Evans Bank is a full-service community bank with 18 branches providing comprehensive financial services to consumer, business and municipal customers throughout Western New York. Evans Investment Services provides non-deposit investment products, such as annuities and mutual funds.

Evans Bancorp, Inc. and Evans Bank routinely post news and other important information on their websites, at www.evansbancorp.com and www.evansbank.com.

Safe Harbor Statement: This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements concerning future business, revenue and earnings. These statements are not historical facts or guarantees of future performance, events or results. There are risks, uncertainties and other factors that could cause the actual results of Evans Bancorp to differ materially from the results expressed or implied by such statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include the impacts from COVID-19, competitive pressures among financial services companies, interest rate trends, general economic conditions, changes in legislation or regulatory requirements, effectiveness at achieving stated goals and strategies, and difficulties in achieving operating efficiencies. These risks and uncertainties are more fully described in Evans Bancorp’s Annual and Quarterly Reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made. Evans Bancorp undertakes no obligation to publicly update or revise forward-looking information, whether as a result of new, updated information, future events or otherwise.

EVANS BANCORP, INC. AND SUBSIDIARIES

SELECTED FINANCIAL DATA (UNAUDITED)

(in thousands, except shares and per share data)

 

 

 

12/31/2023

 

 

 

9/30/2023

 

 

 

6/30/2023

 

 

 

3/31/2023

 

 

 

12/31/2022

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits at banks

 

$

3,798

 

 

$

7,468

 

 

$

10,334

 

 

$

3,832

 

 

$

6,258

 

Securities AFS

 

 

275,680

 

 

 

334,460

 

 

 

351,595

 

 

 

365,929

 

 

 

364,326

 

Securities HTM

 

 

2,059

 

 

 

2,170

 

 

 

2,241

 

 

 

3,707

 

 

 

6,949

 

Loans

 

 

1,720,946

 

 

 

1,704,400

 

 

 

1,670,753

 

 

 

1,658,576

 

 

 

1,672,369

 

Allowance for credit losses

 

 

(22,114)

 

 

 

(21,846)

 

 

 

(21,368)

 

 

 

(21,523)

 

 

 

(19,438)

 

Goodwill and intangible assets

 

 

1,862

 

 

 

13,629

 

 

 

13,729

 

 

 

13,829

 

 

 

13,929

 

All other assets

 

 

126,432

 

 

 

134,462

 

 

 

127,679

 

 

 

123,920

 

 

 

134,117

 

Total assets

 

$

2,108,663

 

 

$

2,174,743

 

 

$

2,154,963

 

 

$

2,148,270

 

 

$

2,178,510

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS'

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

$

390,238

 

 

$

447,306

 

 

$

442,195

 

 

$

483,958

 

 

$

493,710

 

NOW deposits

 

 

345,279

 

 

 

324,219

 

 

 

303,159

 

 

 

268,283

 

 

 

273,359

 

Savings deposits

 

 

649,621

 

 

 

698,653

 

 

 

726,687

 

 

 

807,532

 

 

 

801,943

 

Time deposits

 

 

333,623

 

 

 

335,228

 

 

 

314,574

 

 

 

290,141

 

 

 

202,667

 

Total deposits

 

 

1,718,761

 

 

 

1,805,406

 

 

 

1,786,615

 

 

 

1,849,914

 

 

 

1,771,679

 

Securities sold under agreement to repurchase

 

 

9,475

 

 

 

13,447

 

 

 

19,185

 

 

 

9,264

 

 

 

7,147

 

Subordinated debt

 

 

31,177

 

 

 

31,152

 

 

 

31,126

 

 

 

31,101

 

 

 

31,075

 

Other borrowings

 

 

145,123

 

 

 

151,252

 

 

 

140,386

 

 

 

79,637

 

 

 

193,001

 

Other liabilities

 

 

25,908

 

 

 

22,551

 

 

 

18,167

 

 

 

20,103

 

 

 

21,615

 

Total stockholders' equity

 

$

178,219

 

 

$

150,935

 

 

$

159,484

 

 

$

158,251

 

 

$

153,993

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SHARES AND CAPITAL RATIOS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding

 

 

5,499,772

 

 

 

5,483,591

 

 

 

5,477,505

 

 

 

5,462,763

 

 

 

5,437,048

 

Book value per share

 

$

32.40

 

 

$

27.52

 

 

$

29.12

 

 

$

28.97

 

 

$

28.32

 

Tangible book value per share

 

$

32.07

 

 

$

25.04

 

 

$

26.61

 

 

$

26.44

 

 

$

25.76

 

Tier 1 leverage ratio

 

 

10.37

%

 

 

9.40

%

 

 

9.43

%

 

 

9.13

%

 

 

9.13

%

Tier 1 risk-based capital ratio

 

 

13.80

%

 

 

12.04

%

 

 

12.73

%

 

 

12.55

%

 

 

12.29

%

Total risk-based capital ratio

 

 

15.05

%

 

 

13.29

%

 

 

13.98

%

 

 

13.80

%

 

 

13.48

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSET QUALITY DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total non-performing loans

 

$

27,325

 

 

$

27,311

 

 

$

27,789

 

 

$

24,084

 

 

$

24,728

 

Total net loan charge-offs (recoveries)

 

 

11

 

 

 

35

 

 

 

35

 

 

 

(4)

 

 

 

115

 

Other real estate owned (OREO)

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing loans/Total loans

 

 

1.59

%

 

 

1.60

%

 

 

1.66

%

 

 

1.45

%

 

 

1.48

%

Net loan charge-offs (recoveries)/Average loans

 

 

-

%

 

 

0.01

%

 

 

0.01

%

 

 

-

%

 

 

0.03

%

Allowance for credit losses/Total loans

 

 

1.28

%

 

 

1.28

%

 

 

1.28

%

 

 

1.30

%

 

 

1.16

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EVANS BANCORP, INC AND SUBSIDIARIES

SELECTED OPERATIONS DATA (UNAUDITED)

(in thousands, except share and per share data)

 

 

 

2023

 

 

 

2023

 

 

 

2023

 

 

 

2023

 

 

 

2022

 

 

 

 

Fourth Quarter

 

 

 

Third Quarter

 

 

 

Second Quarter

 

 

 

First Quarter

 

 

 

Fourth Quarter

 

Interest income

 

$

25,205

 

 

$

24,292

 

 

$

23,988

 

 

$

23,365

 

 

$

22,381

 

Interest expense

 

 

11,259

 

 

 

10,036

 

 

 

8,307

 

 

 

6,040

 

 

 

3,167

 

Net interest income

 

 

13,946

 

 

 

14,256

 

 

 

15,681

 

 

 

17,325

 

 

 

19,214

 

Provision for credit losses

 

 

282

 

 

 

506

 

 

 

(116)

 

 

 

(654)

 

 

 

923

 

Net interest income after provision for credit losses

 

 

13,664

 

 

 

13,750

 

 

 

15,797

 

 

 

17,979

 

 

 

18,291

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit service charges

 

 

670

 

 

 

665

 

 

 

645

 

 

 

613

 

 

 

684

 

Insurance service and fee revenue

 

 

1,613

 

 

 

3,498

 

 

 

2,720

 

 

 

2,429

 

 

 

2,204

 

Bank-owned life insurance

 

 

230

 

 

 

239

 

 

 

238

 

 

 

224

 

 

 

221

 

Interchange fee income

 

 

510

 

 

 

516

 

 

 

528

 

 

 

493

 

 

 

507

 

Gain on sale of insurance agency

 

 

20,160

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Loss on sale of investment securities

 

 

(5,044)

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Other income

 

 

412

 

 

 

638

 

 

 

570

 

 

 

354

 

 

 

845

 

Total non-interest income

 

 

18,551

 

 

 

5,556

 

 

 

4,701

 

 

 

4,113

 

 

 

4,461

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

10,251

 

 

 

8,735

 

 

 

8,649

 

 

 

9,413

 

 

 

9,498

 

Occupancy

 

 

1,078

 

 

 

1,109

 

 

 

1,145

 

 

 

1,173

 

 

 

1,190

 

Advertising and public relations

 

 

296

 

 

 

348

 

 

 

407

 

 

 

156

 

 

 

125

 

Professional services

 

 

1,003

 

 

 

869

 

 

 

808

 

 

 

883

 

 

 

871

 

Technology and communications

 

 

1,545

 

 

 

1,517

 

 

 

1,542

 

 

 

1,356

 

 

 

1,437

 

Amortization of intangibles

 

 

67

 

 

 

100

 

 

 

100

 

 

 

100

 

 

 

100

 

FDIC insurance

 

 

350

 

 

 

350

 

 

 

350

 

 

 

350

 

 

 

250

 

Other expenses

 

 

1,710

 

 

 

1,379

 

 

 

1,171

 

 

 

1,071

 

 

 

1,429

 

Total non-interest expenses

 

 

16,300

 

 

 

14,407

 

 

 

14,172

 

 

 

14,502

 

 

 

14,900

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

15,915

 

 

 

4,899

 

 

 

6,326

 

 

 

7,590

 

 

 

7,852

 

Income tax provision

 

 

5,741

 

 

 

1,281

 

 

 

1,394

 

 

 

1,790

 

 

 

1,809

 

Net income

 

 

10,174

 

 

 

3,618

 

 

 

4,932

 

 

 

5,800

 

 

 

6,043

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PER SHARE DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share-diluted

 

$

1.85

 

 

$

0.66

 

 

$

0.90

 

 

$

1.06

 

 

$

1.10

 

Cash dividends per common share

 

$

-

 

 

$

0.66

 

 

$

-

 

 

$

0.66

 

 

$

-

 

Weighted average number of diluted shares

 

 

5,497,029

 

 

 

5,490,600

 

 

 

5,474,462

 

 

 

5,475,790

 

 

 

5,500,810

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PERFORMANCE RATIOS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average total assets

 

 

1.90

%

 

 

0.67

%

 

 

0.91

%

 

 

1.07

%

 

 

1.12

%

Return on average stockholders' equity

 

 

25.73

%

 

 

9.06

%

 

 

12.25

%

 

 

14.97

%

 

 

16.07

%

Return on average tangible common stockholders' equity*

 

 

27.37

%

 

 

9.90

%

 

 

13.39

%

 

 

16.44

%

 

 

17.72

%

Efficiency ratio

 

 

50.16

%

 

 

72.72

%

 

 

69.53

%

 

 

67.65

%

 

 

62.94

%

Efficiency ratio (Non-GAAP)**

 

 

93.40

%

 

 

72.21

%

 

 

69.04

%

 

 

67.18

%

 

 

62.51

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

* The calculation of the average tangible common stockholders' equity ratio excludes goodwill and intangible assets from average stockholders equity.

** The calculation of the non-GAAP efficiency ratio excludes amortization of intangibles, gains and losses from investment securities, gains from sale of subsidiaries, merger-related expenses and the impact of historic tax credit transactions.

EVANS BANCORP, INC AND SUBSIDIARIES

SELECTED AVERAGE BALANCES AND YIELDS/RATES (UNAUDITED)

(in thousands)

 

 

 

2023

 

 

 

2023

 

 

 

2023

 

 

 

2023

 

 

 

2022

 

 

 

 

Fourth Quarter

 

 

 

Third Quarter

 

 

 

Second Quarter

 

 

 

First Quarter

 

 

 

Fourth Quarter

 

AVERAGE BALANCES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, net

 

$

1,682,177

 

 

$

1,658,132

 

 

$

1,646,502

 

 

$

1,641,162

 

 

$

1,627,028

 

Investment securities

 

 

327,303

 

 

 

355,870

 

 

 

373,922

 

 

 

382,329

 

 

 

382,125

 

Interest-bearing deposits at banks

 

 

5,916

 

 

 

9,883

 

 

 

7,235

 

 

 

9,824

 

 

 

10,416

 

Total interest-earning assets

 

 

2,015,396

 

 

 

2,023,885

 

 

 

2,027,659

 

 

 

2,033,315

 

 

 

2,019,569

 

Non interest-earning assets

 

 

128,915

 

 

 

135,896

 

 

 

129,793

 

 

 

133,936

 

 

 

135,035

 

Total Assets

 

$

2,144,311

 

 

$

2,159,781

 

 

$

2,157,452

 

 

$

2,167,251

 

 

$

2,154,604

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW

 

 

333,893

 

 

 

311,624

 

 

 

281,910

 

 

 

260,242

 

 

 

265,313

 

Savings

 

 

687,223

 

 

 

708,724

 

 

 

776,020

 

 

 

796,793

 

 

 

874,816

 

Time deposits

 

 

335,646

 

 

 

325,667

 

 

 

304,575

 

 

 

257,733

 

 

 

174,362

 

Total interest-bearing deposits

 

 

1,356,762

 

 

 

1,346,015

 

 

 

1,362,505

 

 

 

1,314,768

 

 

 

1,314,491

 

Borrowings

 

 

197,363

 

 

 

192,277

 

 

 

163,338

 

 

 

173,053

 

 

 

151,259

 

Total interest-bearing liabilities

 

 

1,554,125

 

 

 

1,538,292

 

 

 

1,525,843

 

 

 

1,487,821

 

 

 

1,465,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

409,115

 

 

 

441,149

 

 

 

451,990

 

 

 

503,945

 

 

 

518,666

 

Other non-interest bearing liabilities

 

 

22,880

 

 

 

20,529

 

 

 

18,532

 

 

 

20,487

 

 

 

19,798

 

Stockholders' equity

 

 

158,191

 

 

 

159,811

 

 

 

161,087

 

 

 

154,998

 

 

 

150,390

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Liabilities and Equity

 

$

2,144,311

 

 

$

2,159,781

 

 

$

2,157,452

 

 

$

2,167,251

 

 

$

2,154,604

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average tangible common stockholders' equity*

 

 

148,673

 

 

 

146,122

 

 

 

147,299

 

 

 

141,111

 

 

 

136,406

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YIELD/RATE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans, net

 

 

5.43

%

 

 

5.25

%

 

 

5.26

%

 

 

5.16

%

 

 

4.88

%

Investment securities

 

 

2.53

%

 

 

2.48

%

 

 

2.47

%

 

 

2.53

%

 

 

2.36

%

Interest-bearing deposits at banks

 

 

6.38

%

 

 

5.29

%

 

 

4.45

%

 

 

3.97

%

 

 

3.16

%

Total interest-earning assets

 

 

4.96

%

 

 

4.76

%

 

 

4.75

%

 

 

4.66

%

 

 

4.40

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW

 

 

2.12

%

 

 

1.79

%

 

 

1.24

%

 

 

0.75

%

 

 

0.36

%

Savings

 

 

2.09

%

 

 

1.85

%

 

 

1.58

%

 

 

0.95

%

 

 

0.33

%

Time deposits

 

 

3.83

%

 

 

3.45

%

 

 

3.10

%

 

 

2.63

%

 

 

1.61

%

Total interest-bearing deposits

 

 

2.53

%

 

 

2.22

%

 

 

1.85

%

 

 

1.24

%

 

 

0.51

%

Borrowings

 

 

5.27

%

 

 

5.14

%

 

 

4.98

%

 

 

4.74

%

 

 

3.88

%

Total interest-bearing liabilities

 

 

2.87

%

 

 

2.59

%

 

 

2.18

%

 

 

1.65

%

 

 

0.86

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate spread

 

 

2.09

%

 

 

2.17

%

 

 

2.57

%

 

 

3.01

%

 

 

3.54

%

Contribution of interest-free funds

 

 

0.66

%

 

 

0.62

%

 

 

0.53

%

 

 

0.45

%

 

 

0.23

%

Net interest margin

 

 

2.75

%

 

 

2.79

%

 

 

3.10

%

 

 

3.46

%

 

 

3.77

%

* Average tangible common stockholders' equity excludes goodwill and intangible assets from average stockholders equity.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EVANS BANCORP, INC AND SUBSIDIARIES

SELECTED OPERATIONS DATA (UNAUDITED)

(in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

2023

 

2022

 

 

 

 

Year to Date

 

Year to Date

 

% Change

Interest income

 

$

96,850

 

$

79,482

 

22

%

Interest expense

 

 

35,642

 

 

6,527

 

446

%

Net interest income

 

 

61,208

 

 

72,955

 

(16)

%

Provision for credit losses

 

 

18

 

 

2,739

 

(99)

%

Net interest income after provision for credit losses

 

 

61,190

 

 

70,216

 

(13)

%

 

 

 

 

 

 

 

 

 

 

Deposit service charges

 

 

2,593

 

 

2,861

 

(9)

%

Insurance service and fee revenue

 

 

10,261

 

 

10,453

 

(2)

%

Bank-owned life insurance

 

 

932

 

 

707

 

32

%

Interchange fee income

 

 

2,047

 

 

2,071

 

(1)

%

Gain on sale of insurance agency

 

 

20,160

 

 

-

 

-

 

Loss on sale of investment securities

 

 

(5,044)

 

 

-

 

-

 

Other income

 

 

1,973

 

 

3,179

 

(38)

%

Total non-interest income

 

 

32,922

 

 

19,271

 

71

%

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

37,047

 

 

38,854

 

(5)

%

Occupancy

 

 

4,506

 

 

4,619

 

(2)

%

Advertising and public relations

 

 

1,207

 

 

1,159

 

4

%

Professional services

 

 

3,563

 

 

3,425

 

4

%

Technology and communications

 

 

5,959

 

 

5,187

 

15

%

FDIC insurance

 

 

1,400

 

 

1,025

 

37

%

Amortization of intangibles

 

 

367

 

 

400

 

(8)

%

Other expenses

 

 

5,333

 

 

5,266

 

1

%

Total non-interest expenses

 

 

59,382

 

 

59,935

 

(1)

%

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

34,730

 

 

29,552

 

18

%

Income tax provision

 

 

10,206

 

 

7,163

 

42

%

Net income

 

 

24,524

 

 

22,389

 

10

%

 

 

 

 

 

 

 

 

 

 

PER SHARE DATA

 

 

 

 

 

 

 

 

 

Net income per common share-diluted

 

$

4.48

 

$

4.04

 

11

%

Cash dividends per common share

 

$

1.32

 

$

1.26

 

5

%

Weighted average number of diluted shares

 

 

5,471,033

 

 

5,536,375

 

 

 

 

 

 

 

 

 

 

 

 

 

PERFORMANCE RATIOS

 

 

 

 

 

 

 

 

 

Return on average total assets

 

 

1.14

%

 

1.02

%

 

 

Return on average stockholders' equity

 

 

15.47

%

 

13.49

%

 

 

Return on average tangible common stockholders' equity*

 

 

16.82

%

 

14.74

%

 

 

Efficiency ratio

 

 

63.09

%

 

64.99

%

 

 

Efficiency ratio (Non-GAAP)**

 

 

74.69

%

 

64.55

%

 

 

Net interest margin

 

 

3.02

%

 

3.53

%

 

 

Net loan charge-offs (recoveries)/Average loans

 

 

-

%

 

0.11

%

 

 

 

 

 

 

 

 

 

 

 

 

* The calculation of the average tangible common stockholders' equity ratio excludes goodwill and intangible assets from average stockholders equity.

** The calculation of the non-GAAP efficiency ratio excludes amortization of intangibles, gains and losses from investment securities, gains from sale of subsidiaries, merger-related expenses and the impact of historic tax credit transactions.

 

 

 

 

 

 

 

 

 

 

 

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