DEFIANCE, Ohio, April 18, 2024 (GLOBE NEWSWIRE) -- SB Financial Group, Inc. (NASDAQ: SBFG) ("SB Financial" or the "Company"), a diversified financial services company providing full-service community banking, mortgage banking, wealth management, private client and title insurance services today reported earnings for the first quarter and ended March 31, 2024.
First Quarter 2024 Highlights Over the First Quarter Prior Year Include:
- Net income of $2.4 million down 3.3 percent from $2.5 million in the same quarter last year. Diluted Earnings Per Share ("EPS") remained steady at $0.35.
- Net interest income totaled $9.2 million, a 11.1 percent decrease from the $10.3 million reported in the first quarter of the prior year.
- Loan growth saw an increase to $991.6 million, up by $15.2 million or 1.6 percent from the $976.3 million in the first quarter of the previous year.
- Nonperforming assets improved to 0.22 percent of total assets, down from 0.30 percent in the same quarter of the prior year.
Trailing Twelve Months Ended March 31, 2024 Highlights Compared to the Prior Year Include:
- EPS was $1.75 for the twelve months ended March 2024, an increase of 1.7 percent from the prior twelve months of $1.72.
- Total deposits were $1.112 billion at the end of March 2024, representing a marginal increase of 0.2 percent from $1.110 billion at the end of March 2023.
- Mortgage origination volume was $209.1 million for the trailing twelve months, with a servicing portfolio of $1.37 billion, which increased by 2.1 percent from the prior year.
| Earnings Highlights | Three Months Ended | |||||||||
| ($ in thousands, except per share & ratios) | Mar. 2024 | Mar. 2023 | % Change | |||||||
| Operating revenue | $ | 13,131 | $ | 13,990 | -6.1 | % | ||||
| Interest income | 15,300 | 13,824 | 10.7 | % | ||||||
| Interest expense | 6,120 | 3,500 | 74.9 | % | ||||||
| Net interest income | 9,180 | 10,324 | -11.1 | % | ||||||
| Provision for credit losses | - | 250 | -100.0 | % | ||||||
| Noninterest income | 3,951 | 3,666 | 7.8 | % | ||||||
| Noninterest expense | 10,282 | 10,773 | -4.6 | % | ||||||
| Net income | 2,368 | 2,450 | -3.3 | % | ||||||
| Earnings per diluted share | 0.35 | 0.35 | 0.0 | % | ||||||
| Return on average assets | 0.71 | % | 0.73 | % | -2.7 | % | ||||
| Return on average equity | 7.70 | % | 8.22 | % | -6.3 | % | ||||
"SB Financial Group has demonstrated operational resilience and a keen strategic focus amid the challenging economic conditions during the quarter ended March 31, 2024," stated Mark A. Klein, Chairman, President, and CEO. "Despite a marginal decline in net income from $2.5 million last year to $2.4 million, our operational adaptability ensured solid profitability, with diluted earnings per share consistently at $0.35. This consistency reflects our unwavering commitment to shareholder value even as we navigate through economic headwinds."
"Our loan portfolio expanded to $991.6 million, an increase of $15.2 million, underscoring our disciplined approach to growth and the deep trust our clients place in us. Despite broader market challenges, our deposit base remained stable at $1.11 billion, showcasing our effective management and the enduring strength of our customer relationships. We maintained a conservative risk profile, with notable improvements in asset quality and no significant charge-offs," Mr. Klein noted.
RESULTS OF OPERATIONS
Consolidated Revenue
In the first quarter of 2024, SB Financial Group's total operating revenue, encompassing net interest income before provision for credit losses and noninterest income, faced significant economic headwinds. Our operating revenue saw a decline of 6.1 percent from the prior year quarter and 13.1 percent from the linked quarter. Although robust, net interest income decreased by 11.1 percent compared to the same period last year, primarily due to increased deposit and funding costs. This also contributed to a 38 basis-point reduction in our net interest margin 1Q 2024 compared to 1Q2023.
Noninterest income, however, showed a positive trajectory, increasing by 7.8 percent from the same quarter last year. This growth was significantly bolstered by a 30.4 percent increase in gains from the sale of mortgages and OMSR. Additionally, mortgage loan servicing fees saw a substantial increase of 25.5 percent. These gains, along with steady customer service fees, built a solid revenue foundation. Despite these strengths, we observed a downturn in revenues from wealth management and title insurance, illustrating the varied performance across our noninterest income streams.
Amid these variances, our strategic focus remains firm. We are dedicated to maintaining a balanced revenue portfolio and dynamically adjusting our strategies to effectively respond to the economic environment. This approach is vital for continuing to create value for our clients and shareholders and demonstrates our commitment to navigating cyclical economic challenges with resilience and foresight.
Mortgage Loan Business
Mortgage loan originations for the first quarter of 2024 totaled $42.9 million, experiencing a contraction from the $49.4 million recorded in the same quarter of the previous year. This downturn reflects the cooling trends within the housing market, indicative of broader economic shifts. Despite this challenging environment, SB Financial Group's strategic agility was evident, with mortgage sales climbing to $36.6 million, or 85 percent of production. This represents an increase of $10.8 million, or approximately 41.9 percent, from the $25.8 million recorded in the prior year quarter, showcasing our ability to capitalize on opportunities within the purchase market.
For this quarter, our mortgage banking net revenue stood at $1.5 million, demonstrating solid performance and an improvement of $0.2 million, or 20.3 percent, from the prior year. This growth, indicative of the robustness of our mortgage servicing operations, is further underscored by the consistent expansion of our servicing portfolio, which grew by 2.0 percent compared to the prior year period, reaching $1.37 billion.
"In a period marked by variable interest rates and a cautious market, SB Financial Group's mortgage banking sector has continued to demonstrate resilience," said Mr. Klein. "The upward trend in mortgage sales, despite a decrease in originations, attests to our team's market presence and strong brand. Our increased net mortgage banking revenue and the expansion of our servicing portfolio reflect our ongoing commitment to this business line."
| Mortgage Banking | |||||||||||||||||||||||
| ($ in thousands) | Mar. 2024 | Dec. 2023 | Sep. 2023 | Jun. 2023 | Mar. 2023 | Prior Year Growth | |||||||||||||||||
| Mortgage originations | $ | 42,912 | $ | 39,566 | $ | 61,200 | $ | 65,387 | $ | 49,366 | $ | (6,454 | ) | ||||||||||
| Mortgage sales | 36,623 | 33,362 | 54,085 | 47,933 | 25,803 | 10,820 | |||||||||||||||||
| Mortgage servicing portfolio | 1,371,713 | 1,366,667 | 1,367,209 | 1,353,904 | 1,344,158 | 27,555 | |||||||||||||||||
| Mortgage servicing rights | 14,191 | 13,906 | 13,893 | 13,723 | 13,548 | 643 | |||||||||||||||||
| Revenue | |||||||||||||||||||||||
| Loan servicing fees | 763 | 855 | 850 | 844 | 844 | (81 | ) | ||||||||||||||||
| OMSR amortization | (273 | ) | (282 | ) | (334 | ) | (334 | ) | (292 | ) | 19 | ||||||||||||
| Net administrative fees | 490 | 573 | 516 | 510 | 552 | (62 | ) | ||||||||||||||||
| OMSR valuation adjustment | 181 | (12 | ) | (78 | ) | (16 | ) | 56 | 125 | ||||||||||||||
| Net loan servicing fees | 671 | 561 | 438 | 494 | 608 | 63 | |||||||||||||||||
| Gain on sale of mortgages | 781 | 747 | 1,207 | 1,056 | 599 | 182 | |||||||||||||||||
| Mortgage banking revenue, net | $ | 1,452 | $ | 1,308 | $ | 1,645 | $ | 1,550 | $ | 1,207 | $ | 245 | |||||||||||
Noninterest Income and Noninterest Expense
For the first quarter of 2024, noninterest income at SB Financial Group surged to $4.0 million, marking a 7.8% increase from the $3.7 million recorded in the prior year quarter. This notable growth is primarily attributable to our strategic initiatives, including enhanced gain-on-sale yields from mortgage loans and higher recapture of servicing rights, which significantly contributed to our financial performance. Additionally, customer service fees rose by $55,000, or 6.7 percent, further reinforcing our strategic focus in this area.
Noninterest expenses for the first quarter were reported at $10.3 million, a reduction of 4.6 percent from the previous year's $10.8 million. This decrease demonstrates our commitment to reducing costs and enhancing operational efficiency, even in a complex and challenging economic environment.
"Our noninterest income has shown consistent growth compared to the same period last year." commented Mr. Klein. "The gains from both mortgage and mortgage servicing fees have been significant, reflecting our agility and expertise in capitalizing on favorable market conditions. On the expense front, we continued to reduce our noninterest expenses, reflecting a diligent and calculated approach to cost management. Our ongoing efforts are focused on maintaining an efficient operational structure, paramount in delivering sustained value to our stakeholders."
| Noninterest Income/Noninterest Expense | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Mar. 2024 | Dec. 2023 | Sep. 2023 | Jun. 2023 | Mar. 2023 | Prior Year Growth | |||||||||||||||||
| Noninterest Income (NII) | $ | 3,951 | $ | 5,531 | $ | 4,163 | $ | 4,361 | $ | 3,666 | $ | 285 | |||||||||||
| NII / Total Revenue | 30.1 | % | 36.6 | % | 30.4 | % | 30.7 | % | 26.2 | % | 3.9 | % | |||||||||||
| NII / Average Assets | 1.2 | % | 1.7 | % | 1.2 | % | 1.3 | % | 1.1 | % | 0.1 | % | |||||||||||
| Total Revenue Growth | -6.1 | % | 3.4 | % | -5.3 | % | -0.5 | % | -2.0 | % | -6.1 | % | |||||||||||
| Noninterest Expense (NIE) | $ | 10,282 | $ | 10,369 | $ | 10,481 | $ | 10,339 | $ | 10,773 | $ | (491 | ) | ||||||||||
| Efficiency Ratio | 78.2 | % | 68.4 | % | 76.4 | % | 72.7 | % | 76.9 | % | 1.3 | % | |||||||||||
| NIE / Average Assets | 3.1 | % | 3.1 | % | 3.1 | % | 3.1 | % | 3.2 | % | -0.1 | % | |||||||||||
| Net Noninterest Expense/Avg. Assets | -1.9 | % | -1.4 | % | -1.9 | % | -1.8 | % | -2.1 | % | 0.2 | % | |||||||||||
| Total Expense Growth | -4.6 | % | 1.0 | % | 0.9 | % | -4.3 | % | -0.8 | % | -4.6 | % | |||||||||||
Balance Sheet
As of March 31, 2024, SB Financial Group has continued to exhibit financial stability, with total assets amounting to $1.34 billion, reflecting a marginal year-over-year decrease of 0.39 percent. Our loan portfolio, which notably surpassed the $1 billion mark in the linked quarter, adjusted to $991.6 million for the first quarter of 2024. Despite this slight retraction, the total loans have increased by $15.2 million, or 1.6 percent compared to the prior year, demonstrating our commitment to prudent lending and strategic asset management amid evolving economic conditions. Additionally, our cash and cash equivalents have been increasing, providing enhanced liquidity and further stabilizing our financial base.
Shareholders' equity has slightly contracted by 0.5 percent to $123.7 million compared to the linked quarter. However, the 3.3% growth, year-over-year, is a positive testament to our ongoing efforts to enhance value for our shareholders.
Mark Klein, remarked, "As we navigate the first quarter of 2024, SB Financial Group remains committed to a disciplined approach to growth, ensuring robust asset quality and maintaining a formidable loan portfolio. Despite a competitive landscape, our loan portfolio has demonstrated resilience, underlining the effectiveness of our relationship-driven lending strategy. This performance is anchored by our dedication to our shareholders, as evidenced by the annual increase in our dividend payout. We are poised to continue capitalizing on strategic opportunities to further strengthen our financial position and deliver sustained shareholder value."
| Loan Balances | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Mar. 2024 | Dec. 2023 | Sep. 2023 | Jun. 2023 | Mar. 2023 | Annual Growth | |||||||||||||||||
| Commercial | $ | 120,016 | $ | 126,716 | $ | 120,325 | $ | 123,226 | $ | 126,066 | $ | (6,050 | ) | ||||||||||
| % of Total | 12.1 | % | 12.7 | % | 12.2 | % | 12.5 | % | 12.9 | % | -4.8 | % | |||||||||||
| Commercial RE | 429,362 | 424,041 | 421,736 | 417,412 | 419,024 | 10,338 | |||||||||||||||||
| % of Total | 43.3 | % | 42.4 | % | 42.6 | % | 42.4 | % | 42.9 | % | 2.5 | % | |||||||||||
| Agriculture | 62,365 | 65,659 | 60,928 | 58,222 | 57,761 | 4,604 | |||||||||||||||||
| % of Total | 6.3 | % | 6.6 | % | 6.2 | % | 5.9 | % | 5.9 | % | 8.0 | % | |||||||||||
| Residential RE | 314,668 | 318,123 | 320,306 | 321,365 | 309,684 | 4,984 | |||||||||||||||||
| % of Total | 31.7 | % | 31.8 | % | 32.4 | % | 32.6 | % | 31.7 | % | 1.6 | % | |||||||||||
| Consumer & Other | 65,141 | 65,673 | 65,726 | 64,599 | 63,777 | 1,364 | |||||||||||||||||
| % of Total | 6.6 | % | 6.6 | % | 6.6 | % | 6.6 | % | 6.5 | % | 2.1 | % | |||||||||||
| Total Loans | $ | 991,552 | $ | 1,000,212 | $ | 989,021 | $ | 984,824 | $ | 976,312 | $ | 15,240 | |||||||||||
| Total Growth Percentage | 1.6 | % | |||||||||||||||||||||
| Deposit Balances | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Mar. 2024 | Dec. 2023 | Sep. 2023 | Jun. 2023 | Mar. 2023 | Annual Growth | |||||||||||||||||
| Non-Int DDA | $ | 219,395 | $ | 228,713 | $ | 224,182 | $ | 218,411 | $ | 237,175 | $ | (17,780 | ) | ||||||||||
| % of Total | 19.7 | % | 21.4 | % | 20.7 | % | 20.4 | % | 21.4 | % | -7.5 | % | |||||||||||
| Interest DDA | 169,171 | 166,413 | 174,729 | 170,282 | 188,497 | (19,326 | ) | ||||||||||||||||
| % of Total | 15.2 | % | 15.5 | % | 16.1 | % | 15.9 | % | 17.0 | % | -10.3 | % | |||||||||||
| Savings | 244,157 | 216,965 | 226,077 | 225,065 | 227,974 | 16,183 | |||||||||||||||||
| % of Total | 21.9 | % | 20.3 | % | 20.8 | % | 21.0 | % | 20.5 | % | 7.1 | % | |||||||||||
| Money Market | 221,362 | 202,605 | 216,565 | 217,681 | 222,203 | (841 | ) | ||||||||||||||||
| % of Total | 19.9 | % | 18.9 | % | 20.0 | % | 20.3 | % | 20.0 | % | -0.4 | % | |||||||||||
| Time Deposits | 258,257 | 255,509 | 243,766 | 239,717 | 234,295 | 23,962 | |||||||||||||||||
| % of Total | 23.2 | % | 23.9 | % | 22.5 | % | 22.4 | % | 21.1 | % | 10.2 | % | |||||||||||
| Total Deposits | $ | 1,112,342 | $ | 1,070,205 | $ | 1,085,319 | $ | 1,071,156 | $ | 1,110,144 | $ | 2,198 | |||||||||||
| Total Growth Percentage | 0.2 | % | |||||||||||||||||||||
Asset Quality
SB Financial Group has consistently prioritized exceptional asset quality, a commitment that has remained steadfast through the first quarter of 2024. As of March 2024, our reports showcase a robust position, with nonperforming loans constituting a mere 0.25% of total loans-a clear testament to the enduring strength and soundness of our lending practices. This represents a significant improvement, with a 10 basis point reduction from the previous year, which reported nonperforming loans at 0.35% of total loans.
Significantly, the allowance for credit losses to nonperforming loans ratio has reached a strong 643 percent. This not only emphasizes our proactive and preemptive measures in managing asset quality but also exceeds the performance benchmark set in the previous year. This ratio reflects our structured approach to risk management, which is aligned with the Current Expected Credit Loss (CECL) methodology, ensuring we remain well-prepared for any contingencies.
Furthermore, the net loan charge-offs to average loans ratio, annualized at 0.02%, underlines our effective handling of loan repayments and the high quality of our credit portfolio. With such solid metrics, we continue to uphold our strong reputation for risk management and credit excellence.
Mark A. Klein, Chairman, President, and CEO of SB Financial, noted, "Our commitment to asset quality is unwavering and clearly evident in our first-quarter performance. The strength of our loan portfolio is reflected in the low percentage of nonperforming loans and a substantial allowance for potential credit losses, demonstrating our vigilant approach to asset management and our resilience in the face of economic variables."
| Nonperforming Assets | |||||||||||||||||||||||
| ($ in thousands, except ratios) | Mar. 2024 | Dec. 2023 | Sep. 2023 | Jun. 2023 | Mar. 2023 | Annual Change | |||||||||||||||||
| Commercial & Agriculture | $ | 897 | $ | 748 | $ | 717 | $ | 170 | $ | 185 | $ | 712 | |||||||||||
| % of Total Com./Ag. loans | 0.49 | % | 0.39 | % | 0.40 | % | 0.09 | % | 0.10 | % | 384.9 | % | |||||||||||
| Commercial RE | 49 | 168 | 222 | 192 | 199 | (150 | ) | ||||||||||||||||
| % of Total CRE loans | 0.01 | % | 0.04 | % | 0.05 | % | 0.05 | % | 0.05 | % | -75.4 | % | |||||||||||
| Residential RE | 1,295 | 1,690 | 2,182 | 2,266 | 2,742 | (1,447 | ) | ||||||||||||||||
| % of Total Res. RE loans | 0.41 | % | 0.53 | % | 0.68 | % | 0.71 | % | 0.89 | % | -52.8 | % | |||||||||||
| Consumer & Other | 193 | 212 | 208 | 282 | 270 | (77 | ) | ||||||||||||||||
| % of Total Con./Oth. loans | 0.30 | % | 0.32 | % | 0.32 | % | 0.44 | % | 0.42 | % | -28.5 | % | |||||||||||
| Total Nonaccruing Loans | 2,434 | 2,818 | 3,329 | 2,910 | 3,396 | (962 | ) | ||||||||||||||||
| % of Total loans | 0.25 | % | 0.28 | % | 0.34 | % | 0.30 | % | 0.35 | % | -28.3 | % | |||||||||||
| Foreclosed Assets and Other Assets | 510 | 511 | 629 | 625 | 650 | (140 | ) | ||||||||||||||||
| Total Change (%) | -21.5 | % | |||||||||||||||||||||
| Total Nonperforming Assets | $ | 2,944 | $ | 3,329 | $ | 3,958 | $ | 3,535 | $ | 4,046 | $ | (1,102 | ) | ||||||||||
| % of Total assets | 0.22 | % | 0.25 | % | 0.30 | % | 0.26 | % | 0.30 | % | -27.24 | % | |||||||||||
Webcast and Conference Call
The Company will hold the first quarter 2024 earnings conference call and webcast on April 19, 2024, at 11:00 a.m. EDT. Interested parties may access the conference call by dialing 1-888-338-9469. The webcast can be accessed at ir.yourstatebank.com. An audio replay of the call will be available on the Company's website.
About SB Financial Group
Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title). State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 23 offices: 22 in nine Ohio counties and one in Fort Wayne, Indiana, and 23 ATMs. State Bank has six loan production offices located throughout the Tri-State region of Ohio, Indiana and Michigan. Peak Title provides title insurance and title opinions throughout the Tri-State region. SB Financial's common stock is listed on the NASDAQ Capital Market with the ticker symbol "SBFG".
In May 2023, SB Financial was valued #163 on the American Banker Magazine's list of top 200 publicly traded Community Bank and Thrifts based on three-year average return on equity.
Forward-Looking Statements
Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial's Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles ("GAAP"). Non-GAAP financial measures, specifically pre-tax, pre-provision income, tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common equity, total interest income - FTE, net interest income - FTE and net interest margin - FTE are used by the Company's management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. In addition, the Company excludes the OMSR valuation adjustment from net income to report a non-GAAP adjusted net income level. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Investor Contact Information:
Mark A. Klein
Chairman, President and
Chief Executive Officer
Mark.Klein@YourStateBank.com
Anthony V. Cosentino
Executive Vice President and
Chief Financial Officer
Tony.Cosentino@YourStateBank.com
| SB FINANCIAL GROUP, INC. | |||||||||||||||||||
| CONSOLIDATED BALANCE SHEETS - (Unaudited) | |||||||||||||||||||
| March | December | September | June | March | |||||||||||||||
| ($ in thousands) | 2024 | 2023 | 2023 | 2023 | 2023 | ||||||||||||||
| ASSETS | |||||||||||||||||||
| Cash and due from banks | $ | 26,602 | $ | 22,965 | $ | 19,049 | $ | 20,993 | $ | 21,625 | |||||||||
| Interest bearing time deposits | 2,417 | 1,535 | 1,180 | 1,180 | 1,380 | ||||||||||||||
| Available-for-sale securities | 213,239 | 219,708 | 212,768 | 227,996 | 237,607 | ||||||||||||||
| Loans held for sale | 4,730 | 2,525 | 3,206 | 5,684 | 5,592 | ||||||||||||||
| Loans, net of unearned income | 991,552 | 1,000,212 | 989,021 | 984,824 | 976,312 | ||||||||||||||
| Allowance for credit losses | (15,643 | ) | (15,786 | ) | (15,790 | ) | (15,795 | ) | (15,442 | ) | |||||||||
| Premises and equipment, net | 20,985 | 21,378 | 21,934 | 22,230 | 22,621 | ||||||||||||||
| Federal Reserve and FHLB Stock, at cost | 6,512 | 7,279 | 6,261 | 7,634 | 6,054 | ||||||||||||||
| Foreclosed assets and other assets | 510 | 511 | 629 | 625 | 650 | ||||||||||||||
| Interest receivable | 4,584 | 4,657 | 4,457 | 4,079 | 3,926 | ||||||||||||||
| Goodwill | 23,239 | 23,239 | 23,239 | 23,239 | 23,239 | ||||||||||||||
| Cash value of life insurance | 30,103 | 29,121 | 29,291 | 29,183 | 29,024 | ||||||||||||||
| Mortgage servicing rights | 14,191 | 13,906 | 13,893 | 13,723 | 13,548 | ||||||||||||||
| Other assets | 12,991 | 11,999 | 17,336 | 15,840 | 15,157 | ||||||||||||||
| Total assets | $ | 1,336,012 | $ | 1,343,249 | $ | 1,326,474 | $ | 1,341,435 | $ | 1,341,293 | |||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||||||||
| Deposits | |||||||||||||||||||
| Non interest bearing demand | $ | 219,395 | $ | 228,713 | $ | 224,182 | $ | 218,411 | $ | 237,175 | |||||||||
| Interest bearing demand | 169,171 | 166,413 | 174,729 | 170,282 | 188,497 | ||||||||||||||
| Savings | 244,157 | 216,965 | 226,077 | 225,065 | 227,974 | ||||||||||||||
| Money market | 221,362 | 202,605 | 216,565 | 217,681 | 222,203 | ||||||||||||||
| Time deposits | 258,257 | 255,509 | 243,766 | 239,717 | 234,295 | ||||||||||||||
| Total deposits | 1,112,342 | 1,070,205 | 1,085,319 | 1,071,156 | 1,110,144 | ||||||||||||||
| Short-term borrowings | 12,916 | 13,387 | 16,519 | 21,118 | 15,998 | ||||||||||||||
| Federal Home Loan Bank advances | 35,000 | 83,600 | 59,500 | 81,300 | 44,500 | ||||||||||||||
| Trust preferred securities | 10,310 | 10,310 | 10,310 | 10,310 | 10,310 | ||||||||||||||
| Subordinated debt net of issuance costs | 19,654 | 19,642 | 19,630 | 19,618 | 19,606 | ||||||||||||||
| Interest payable | 2,772 | 2,443 | 2,216 | 1,866 | 1,441 | ||||||||||||||
| Other liabilities | 19,295 | 19,320 | 20,632 | 18,401 | 19,535 | ||||||||||||||
| Total liabilities | 1,212,289 | 1,218,907 | 1,214,126 | 1,223,769 | 1,221,534 | ||||||||||||||
| Shareholders' Equity | |||||||||||||||||||
| Common stock | 61,319 | 61,319 | 61,319 | 61,319 | 61,319 | ||||||||||||||
| Additional paid-in capital | 14,978 | 15,124 | 15,037 | 15,154 | 14,953 | ||||||||||||||
| Retained earnings | 109,938 | 108,486 | 105,521 | 103,725 | 101,548 | ||||||||||||||
| Accumulated other comprehensive loss | (31,547 | ) | (29,831 | ) | (39,517 | ) | (32,894 | ) | (29,671 | ) | |||||||||
| Treasury stock | (30,965 | ) | (30,756 | ) | (30,012 | ) | (29,638 | ) | (28,390 | ) | |||||||||
| Total shareholders' equity | 123,723 | 124,342 | 112,348 | 117,666 | 119,759 | ||||||||||||||
| Total liabilities and shareholders' equity | $ | 1,336,012 | $ | 1,343,249 | $ | 1,326,474 | $ | 1,341,435 | $ | 1,341,293 | |||||||||
| SB FINANCIAL GROUP, INC. | ||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME - (Unaudited) | ||||||||||||||||||||
| ($ in thousands, except per share & ratios) | At and for the Three Months Ended | |||||||||||||||||||
| March | December | September | June | March | ||||||||||||||||
| Interest income | 2024 | 2023 | 2023 | 2023 | 2023 | |||||||||||||||
| Loans | ||||||||||||||||||||
| Taxable | $ | 13,547 | $ | 13,438 | $ | 13,128 | $ | 12,715 | $ | 12,126 | ||||||||||
| Tax exempt | 123 | 124 | 122 | 121 | 116 | |||||||||||||||
| Securities | ||||||||||||||||||||
| Taxable | 1,593 | 1,526 | 1,507 | 1,524 | 1,535 | |||||||||||||||
| Tax exempt | 37 | 38 | 39 | 46 | 47 | |||||||||||||||
| Total interest income | 15,300 | 15,126 | 14,796 | 14,406 | 13,824 | |||||||||||||||
| Interest expense | ||||||||||||||||||||
| Deposits | 5,090 | 4,398 | 4,194 | 3,538 | 2,578 | |||||||||||||||
| Repurchase agreements & other | 34 | 39 | 16 | 9 | 10 | |||||||||||||||
| Federal Home Loan Bank advances | 613 | 720 | 666 | 664 | 553 | |||||||||||||||
| Trust preferred securities | 188 | 191 | 189 | 172 | 164 | |||||||||||||||
| Subordinated debt | 195 | 194 | 195 | 194 | 195 | |||||||||||||||
| Total interest expense | 6,120 | 5,542 | 5,260 | 4,577 | 3,500 | |||||||||||||||
| Net interest income | 9,180 | 9,584 | 9,536 | 9,829 | 10,324 | |||||||||||||||
| Provision for credit losses | - | (74 | ) | (6 | ) | 145 | 250 | |||||||||||||
| Net interest income after provision for loan losses | 9,180 | 9,658 | 9,542 | 9,684 | 10,074 | |||||||||||||||
| Noninterest income | ||||||||||||||||||||
| Wealth management fees | 865 | 838 | 837 | 940 | 917 | |||||||||||||||
| Customer service fees | 880 | 844 | 863 | 871 | 825 | |||||||||||||||
| Gain on sale of mtg. loans & OMSR | 781 | 747 | 1,207 | 1,056 | 599 | |||||||||||||||
| Mortgage loan servicing fees, net | 671 | 561 | 438 | 494 | 608 | |||||||||||||||
| Gain on sale of non-mortgage loans | 10 | 177 | 10 | 218 | 24 | |||||||||||||||
| Title insurance revenue | 266 | 378 | 429 | 455 | 373 | |||||||||||||||
| Net gain on sales of securities | - | 1,453 | - | - | - | |||||||||||||||
| Gain (loss) on sale of assets | - | 16 | - | 15 | (11 | ) | ||||||||||||||
| Other | 478 | 517 | 379 | 312 | 331 | |||||||||||||||
| Total noninterest income | 3,951 | 5,531 | 4,163 | 4,361 | 3,666 | |||||||||||||||
| Noninterest expense | ||||||||||||||||||||
| Salaries and employee benefits | 5,352 | 5,652 | 5,491 | 5,721 | 5,913 | |||||||||||||||
| Net occupancy expense | 769 | 746 | 764 | 802 | 784 | |||||||||||||||
| Equipment expense | 1,077 | 1,027 | 1,068 | 1,002 | 981 | |||||||||||||||
| Data processing fees | 769 | 680 | 648 | 685 | 646 | |||||||||||||||
| Professional fees | 758 | 926 | 623 | 612 | 863 | |||||||||||||||
| Marketing expense | 197 | 182 | 189 | 213 | 198 | |||||||||||||||
| Telephone and communication expense | 105 | 132 | 124 | 124 | 121 | |||||||||||||||
| Postage and delivery expense | 97 | 167 | 100 | 78 | 87 | |||||||||||||||
| State, local and other taxes | 245 | 285 | 218 | 218 | 228 | |||||||||||||||
| Employee expense | 178 | 146 | 141 | 156 | 188 | |||||||||||||||
| Other expenses | 735 | 426 | 1,115 | 728 | 764 | |||||||||||||||
| Total noninterest expense | 10,282 | 10,369 | 10,481 | 10,339 | 10,773 | |||||||||||||||
| Income before income tax expense | 2,849 | 4,820 | 3,224 | 3,706 | 2,967 | |||||||||||||||
| Income tax expense | 481 | 937 | 537 | 631 | 517 | |||||||||||||||
| Net income | $ | 2,368 | $ | 3,883 | $ | 2,687 | $ | 3,075 | $ | 2,450 | ||||||||||
| Common share data: | ||||||||||||||||||||
| Basic earnings per common share | $ | 0.35 | $ | 0.58 | $ | 0.40 | $ | 0.45 | $ | 0.35 | ||||||||||
| Diluted earnings per common share | $ | 0.35 | $ | 0.57 | $ | 0.39 | $ | 0.44 | $ | 0.35 | ||||||||||
| Average shares outstanding (in thousands): | ||||||||||||||||||||
| Basic: | 6,715 | 6,748 | 6,791 | 6,847 | 6,933 | |||||||||||||||
| Diluted: | 6,723 | 6,851 | 6,878 | 6,910 | 7,008 | |||||||||||||||
| SB FINANCIAL GROUP, INC. | ||||||||||||||||||||
| CONSOLIDATED FINANCIAL HIGHLIGHTS - (Unaudited) | ||||||||||||||||||||
| ($ in thousands, except per share & ratios) | At and for the Three Months Ended | |||||||||||||||||||
| March | December | September | June | March | ||||||||||||||||
| SUMMARY OF OPERATIONS | 2024 | 2023 | 2023 | 2023 | 2023 | |||||||||||||||
| Net interest income | $ | 9,180 | $ | 9,584 | $ | 9,536 | $ | 9,829 | $ | 10,324 | ||||||||||
| Tax-equivalent adjustment | 43 | 43 | 43 | 44 | 43 | |||||||||||||||
| Tax-equivalent net interest income | 9,223 | 9,627 | 9,579 | 9,873 | 10,367 | |||||||||||||||
| Provision for credit loss | - | (74 | ) | (6 | ) | 145 | 250 | |||||||||||||
| Noninterest income | 3,951 | 5,531 | 4,163 | 4,361 | 3,666 | |||||||||||||||
| Total operating revenue | 13,131 | 15,115 | 13,699 | 14,190 | 13,990 | |||||||||||||||
| Noninterest expense | 10,282 | 10,369 | 10,481 | 10,339 | 10,773 | |||||||||||||||
| Pre-tax pre-provision income | 2,849 | 4,746 | 3,218 | 3,851 | 3,217 | |||||||||||||||
| Pretax income | 2,849 | 4,820 | 3,224 | 3,706 | 2,967 | |||||||||||||||
| Net income | 2,368 | 3,883 | 2,687 | 3,075 | 2,450 | |||||||||||||||
| PER SHARE INFORMATION: | ||||||||||||||||||||
| Basic earnings per share (EPS) | 0.35 | 0.58 | 0.40 | 0.45 | 0.35 | |||||||||||||||
| Diluted earnings per share | 0.35 | 0.57 | 0.39 | 0.44 | 0.35 | |||||||||||||||
| Common dividends | 0.135 | 0.135 | 0.130 | 0.130 | 0.125 | |||||||||||||||
| Book value per common share | 18.46 | 18.50 | 16.59 | 17.30 | 17.37 | |||||||||||||||
| Tangible book value per common share (TBV) | 14.93 | 14.98 | 13.09 | 13.81 | 13.93 | |||||||||||||||
| Market price per common share | 13.78 | 15.35 | 13.50 | 12.62 | 14.13 | |||||||||||||||
| Market price to TBV | 92.3 | % | 102.5 | % | 103.1 | % | 91.4 | % | 101.4 | % | ||||||||||
| Market price to trailing 12 month EPS | 7.9 | 8.8 | 8.0 | 7.1 | 8.2 | |||||||||||||||
| PERFORMANCE RATIOS: | ||||||||||||||||||||
| Return on average assets (ROAA) | 0.71 | % | 1.17 | % | 0.80 | % | 0.91 | % | 0.73 | % | ||||||||||
| Pre-tax pre-provision ROAA | 0.85 | % | 1.43 | % | 0.96 | % | 1.14 | % | 0.96 | % | ||||||||||
| Return on average equity | 7.70 | % | 13.23 | % | 9.25 | % | 10.32 | % | 8.22 | % | ||||||||||
| Return on average tangible equity | 9.53 | % | 16.57 | % | 11.62 | % | 12.89 | % | 10.26 | % | ||||||||||
| Efficiency ratio | 78.17 | % | 68.44 | % | 76.34 | % | 72.71 | % | 76.85 | % | ||||||||||
| Earning asset yield | 4.97 | % | 4.89 | % | 4.78 | % | 4.61 | % | 4.49 | % | ||||||||||
| Cost of interest bearing liabilities | 2.55 | % | 2.33 | % | 2.18 | % | 1.90 | % | 1.46 | % | ||||||||||
| Net interest margin | 2.98 | % | 3.10 | % | 3.08 | % | 3.15 | % | 3.35 | % | ||||||||||
| Tax equivalent effect | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.02 | % | ||||||||||
| Net interest margin, tax equivalent | 2.99 | % | 3.11 | % | 3.09 | % | 3.16 | % | 3.37 | % | ||||||||||
| Non interest income/Average assets | 1.19 | % | 1.67 | % | 1.24 | % | 1.30 | % | 1.10 | % | ||||||||||
| Non interest expense/Average assets | 3.08 | % | 3.12 | % | 3.13 | % | 3.07 | % | 3.23 | % | ||||||||||
| Net noninterest expense/Average assets | -1.90 | % | -1.46 | % | -1.89 | % | -1.78 | % | -2.13 | % | ||||||||||
| ASSET QUALITY RATIOS: | ||||||||||||||||||||
| Gross charge-offs | 66 | 5 | 12 | 32 | 69 | |||||||||||||||
| Recoveries | 9 | 1 | 7 | 10 | 8 | |||||||||||||||
| Net charge-offs | 57 | 4 | 5 | 22 | 61 | |||||||||||||||
| Nonperforming loans/Total loans | 0.25 | % | 0.28 | % | 0.34 | % | 0.30 | % | 0.35 | % | ||||||||||
| Nonperforming assets/Loans & OREO | 0.30 | % | 0.33 | % | 0.40 | % | 0.36 | % | 0.41 | % | ||||||||||
| Nonperforming assets/Total assets | 0.22 | % | 0.25 | % | 0.30 | % | 0.26 | % | 0.30 | % | ||||||||||
| Allowance for credit loss/Nonperforming loans | 642.69 | % | 560.18 | % | 474.32 | % | 542.78 | % | 454.71 | % | ||||||||||
| Allowance for credit loss/Total loans | 1.58 | % | 1.58 | % | 1.60 | % | 1.60 | % | 1.58 | % | ||||||||||
| Net loan charge-offs/Average loans (ann.) | 0.02 | % | 0.00 | % | 0.00 | % | 0.01 | % | 0.03 | % | ||||||||||
| CAPITAL & LIQUIDITY RATIOS: | ||||||||||||||||||||
| Loans/ Deposits | 89.14 | % | 93.46 | % | 91.13 | % | 91.94 | % | 87.94 | % | ||||||||||
| Equity/ Assets | 9.26 | % | 9.26 | % | 8.47 | % | 8.77 | % | 8.93 | % | ||||||||||
| Tangible equity/Tangible assets | 7.63 | % | 7.63 | % | 6.81 | % | 7.13 | % | 7.29 | % | ||||||||||
| Common equity tier 1 ratio (Bank) | 13.63 | % | 13.42 | % | 13.56 | % | 13.18 | % | 13.44 | % | ||||||||||
| END OF PERIOD BALANCES | ||||||||||||||||||||
| Total assets | 1,336,012 | 1,343,249 | 1,326,474 | 1,341,435 | 1,341,293 | |||||||||||||||
| Total loans | 991,552 | 1,000,212 | 989,021 | 984,824 | 976,312 | |||||||||||||||
| Deposits | 1,112,342 | 1,070,205 | 1,085,319 | 1,071,156 | 1,110,144 | |||||||||||||||
| Shareholders equity | 123,723 | 124,342 | 112,348 | 117,666 | 119,759 | |||||||||||||||
| Goodwill and intangibles | 23,646 | 23,662 | 23,687 | 23,710 | 23,732 | |||||||||||||||
| Tangible equity | 100,077 | 100,680 | 88,661 | 93,956 | 96,027 | |||||||||||||||
| Mortgage servicing portfolio | 1,371,713 | 1,366,667 | 1,367,209 | 1,353,904 | 1,344,158 | |||||||||||||||
| Wealth/Brokerage assets under care | 525,517 | 501,829 | 478,236 | 499,255 | 518,009 | |||||||||||||||
| Total assets under care | 3,233,242 | 3,211,745 | 3,171,919 | 3,194,594 | 3,203,460 | |||||||||||||||
| Full-time equivalent employees | 245 | 251 | 252 | 253 | 255 | |||||||||||||||
| Period end common shares outstanding | 6,702 | 6,720 | 6,773 | 6,803 | 6,894 | |||||||||||||||
| Market capitalization (all) | 92,359 | 103,147 | 91,437 | 85,857 | 97,419 | |||||||||||||||
| AVERAGE BALANCES | ||||||||||||||||||||
| Total assets | 1,333,236 | 1,327,415 | 1,339,870 | 1,346,010 | 1,335,056 | |||||||||||||||
| Total earning assets | 1,230,736 | 1,236,165 | 1,239,145 | 1,248,813 | 1,232,018 | |||||||||||||||
| Total loans | 993,310 | 992,337 | 989,089 | 988,348 | 970,813 | |||||||||||||||
| Deposits | 1,091,803 | 1,084,939 | 1,095,414 | 1,100,344 | 1,098,935 | |||||||||||||||
| Shareholders equity | 123,058 | 117,397 | 116,165 | 119,177 | 119,237 | |||||||||||||||
| Goodwill and intangibles | 23,654 | 23,675 | 23,698 | 23,721 | 23,743 | |||||||||||||||
| Tangible equity | 99,404 | 93,722 | 92,467 | 95,456 | 95,494 | |||||||||||||||
| Average basic shares outstanding | 6,715 | 6,748 | 6,791 | 6,847 | 6,933 | |||||||||||||||
| Average diluted shares outstanding | 6,723 | 6,851 | 6,878 | 6,910 | 7,008 | |||||||||||||||
| SB FINANCIAL GROUP, INC. | |||||||||||||||
| Rate Volume Analysis - (Unaudited) | |||||||||||||||
| For the Three Months Ended Mar. 31, 2024 and 2023 | |||||||||||||||
| ($ in thousands) | Three Months Ended Mar. 31, 2024 | Three Months Ended Mar. 31, 2023 | |||||||||||||
| Average | Average | Average | Average | ||||||||||||
| Assets | Balance | Interest | Rate | Balance | Interest | Rate | |||||||||
| Taxable securities/cash | $ | 230,981 | $ | 1,593 | 2.76 | % | $ | 253,449 | $ | 1,535 | 2.42 | % | |||
| Nontaxable securities | 6,445 | 37 | 2.30 | % | 7,756 | 47 | 2.42 | % | |||||||
| Loans, net | 993,310 | 13,670 | 5.50 | % | 970,813 | 12,242 | 5.04 | % | |||||||
| Total earning assets | 1,230,736 | 15,300 | 4.97 | % | 1,232,018 | 13,824 | 4.49 | % | |||||||
| Cash and due from banks | 4,512 | 11,067 | |||||||||||||
| Allowance for loan losses | (15,830 | ) | (14,763 | ) | |||||||||||
| Premises and equipment | 21,281 | 22,858 | |||||||||||||
| Other assets | 92,537 | 83,876 | |||||||||||||
| Total assets | $ | 1,333,236 | $ | 1,335,056 | |||||||||||
| Liabilities | |||||||||||||||
| Savings, MMDA and interest bearing demand | $ | 605,243 | $ | 2,525 | 1.67 | % | $ | 643,081 | $ | 1,285 | 0.80 | % | |||
| Time deposits | 258,592 | 2,565 | 3.97 | % | 214,978 | 1,293 | 2.41 | % | |||||||
| Repurchase agreements & other | 15,993 | 34 | 0.85 | % | 18,618 | 10 | 0.21 | % | |||||||
| Advances from Federal Home Loan Bank | 51,030 | 613 | 4.81 | % | 49,177 | 553 | 4.50 | % | |||||||
| Trust preferred securities | 10,310 | 188 | 7.29 | % | 10,310 | 164 | 6.36 | % | |||||||
| Subordinated debt | 19,646 | 195 | 3.97 | % | 19,598 | 195 | 3.98 | % | |||||||
| Total interest bearing liabilities | 960,814 | 6,120 | 2.55 | % | 955,762 | 3,500 | 1.46 | % | |||||||
| Non interest bearing demand | 227,968 | - | 240,876 | - | |||||||||||
| Total funding | 1,188,782 | 2.06 | % | 1,196,638 | 1.17 | % | |||||||||
| Other liabilities | 21,396 | 21,347 | |||||||||||||
| Total liabilities | 1,210,178 | 1,217,985 | |||||||||||||
| Equity | 123,058 | 117,071 | |||||||||||||
| Total liabilities and equity | $ | 1,333,236 | $ | 1,335,056 | |||||||||||
| Net interest income | $ | 9,180 | $ | 10,324 | |||||||||||
| Net interest income as a percent of average interest-earning assets - GAAP measure | 2.98 | % | 3.35 | % | |||||||||||
| Net interest income as a percent of average interest-earning assets - non GAAP | 2.99 | % | 3.37 | % | |||||||||||
| - Computed on a fully tax equivalent (FTE) basis | |||||||||||||||
| Non-GAAP reconciliation | Three Months Ended | ||||||
| ($ in thousands, except per share & ratios) | Mar. 31, 2024 | Mar. 31, 2023 | |||||
| Total Operating Revenue | $ | 13,131 | $ | 13,990 | |||
| Adjustment to (deduct)/add OMSR recapture/impairment * | (181 | ) | (56 | ) | |||
| Adjusted Total Operating Revenue | 12,950 | 13,934 | |||||
| Income before Income Taxes | 2,849 | 2,967 | |||||
| Adjustment for OMSR * | (181 | ) | (56 | ) | |||
| Adjusted Income before Income Taxes | 2,668 | 2,911 | |||||
| Provision for Income Taxes | 481 | 517 | |||||
| Adjustment for OMSR ** | (38 | ) | (12 | ) | |||
| Adjusted Provision for Income Taxes | 443 | 505 | |||||
| Net Income | 2,368 | 2,450 | |||||
| Adjustment for OMSR * | (143 | ) | (44 | ) | |||
| Adjusted Net Income | 2,225 | 2,406 | |||||
| Diluted Earnings per Share | 0.35 | 0.35 | |||||
| Adjustment for OMSR * | (0.02 | ) | (0.01 | ) | |||
| Adjusted Diluted Earnings per Share | $ | 0.33 | $ | 0.34 | |||
| Return on Average Assets | 0.71 | % | 0.73 | % | |||
| Adjustment for OMSR * | -0.04 | % | -0.01 | % | |||
| Adjusted Return on Average Assets | 0.67 | % | 0.72 | % | |||
| *valuation adjustment to the Company's mortgage servicing rights | |||||||
| **tax effect is calculated using a 21% statutory federal corporate income tax rate | |||||||
