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PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Truxton Corporation Reports Second Quarter 2021 Results

July 22, 2021 GMT

NASHVILLE, Tenn., July 22, 2021 (GLOBE NEWSWIRE) -- Truxton Corporation (OTCPK: TRUX), the parent company for Truxton Trust Company (“Truxton” or “the Bank”) and subsidiaries, announced its operating results for the quarter ended June 30, 2021. Second quarter net income attributable to common shareholders was $3.6 million or $1.22 per diluted share compared to $2.6 million or $0.92 per diluted share for the same quarter in 2020. Net income rose by 36% for the quarter compared to the second quarter of 2020 while fully diluted earnings per share rose by 33%.

“Truxton’s second quarter 2021 performance was exceptional in many ways,” said Chairman and CEO Tom Stumb. “Wealth management revenue increased 33% from this quarter last year. Securities markets were strong, and many new families entrusted their wealth to the professionals at Truxton. Loans, excluding Paycheck Protection Program (PPP) loans, grew 18% from the end of June 2020. Our lenders continued to deepen relationships with families and businesses in our market. Nashville continues to experience very strong economic and population growth, and Truxton is a beneficiary. This quarter’s strong performance resulted in part from $254,000 in PPP loan fee recognition, which will continue to boost earnings as the remainder of these loans are forgiven over the next two quarters but is not expected to persist into next year.”

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Key Highlights

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  • Non-interest income grew to $3.9 million in the second quarter, an increase of 10% from the first quarter of 2021 and 33% in comparison to the second quarter of 2020. Wealth management services constituted 95% of non-interest income in the second quarter of 2021.
  • Loans rose by 5% to $452 million compared to March 31, 2021, and were up 9% compared to June 30, 2020. Excluding PPP loans, loans rose by 8% compared to March 31, 2021, and 18% compared to June 30, 2020.
  • Total deposits increased by 8% from March 31, 2021 to $707.4 million, and increased by 38% in comparison to June 30, 2020. Truxton continues to fund its growth from a single banking location through superior deposit operations service and technology. As a result, occupancy expenditures and fixed asset investments are a fraction of typical peers.
  • Net interest margin for the second quarter of 2021 was 2.71%, an increase of 7 basis points from the 2.64% experienced in the first quarter of 2021, and a decrease of 42 basis points from the second quarter of 2020. Cost of funds was 0.46% in the second quarter of 2021, down from 0.49% for the quarter ended March 31, 2021, but up from 0.36% the quarter ended June 30, 2020. The year-over-year increase was the result of the issuance of $15 million of 4.5% subordinated notes in September 2020. We continue to have excess liquidity because of the deposit growth we experienced in 2020 that has continued into the second quarter of 2021.
  • Asset quality remains sound at Truxton. Truxton had $2 million in non-performing assets at June 30, 2021, 98% of which was represented by a single residential mortgage. Truxton had $1,000 of charge-offs in the quarter, $8,000 in the trailing quarter, and $8,000 in the same quarter a year ago. All of these charge-offs are from small loans acquired from a housing not-for profit.
  • Allowance for loan losses was $4.6 million, $4.6 million, and $4.0 million at quarter end June 30, 2021, March 31, 2020, and June 30, 2020, respectively. For the same three periods, the Bank’s allowance was 1.00%, 1.05%, and 0.95%, respectively, of gross loans (including PPP loans) outstanding at period end.
  • Tax expense increased by 27% from the March 31, 2021 quarter and by 20% from the June 30, 2020 period. Truxton believes that the effective tax rate of approximately 19% of pretax net income will persist under current state and federal law. Truxton has several sources of lightly taxed income including yield on bank-owned life insurance, the earnings of the bank’s captive insurance company, and the interest income from the bank’s tax-exempt bond portfolio that cause its effective rate to be below the combined statutory rates.
  • The Bank’s capital position remains strong. Its Tier 1 leverage ratio was 9.47% at June 30, 2021, 9.39% at March 31, 2021, and 9.82% at June 30, 2020. Book value per common share was $27.35, $25.93, and $24.41 at June 30, 2021, March 31, 2021, and June 30, 2020, respectively. During the twelve months ended June 30, 2021, Truxton Corporation paid dividends of $2.16 per common share.

About Truxton Trust
Truxton Trust Company is a provider of private banking, wealth management, trust, and family office services for wealthy individuals, their families and their business interests. Serving clients across the world, Truxton’s vastly experienced team of professionals provides customized solutions to its clients’ complex financial needs. Founded in 2004 in Nashville, Tennessee, Truxton Trust upholds its original guiding principle: do the right thing. Truxton Trust Company is a subsidiary of financial holding company, Truxton Corporation (OTCPK: TRUX). For more information, visit truxtontrust.com.

Truxton Corporation
Consolidated Balance Sheets
(000's)
(Unaudited)
       
  June 30, 2021* March 31, 2021* June 30, 2020*
ASSETS      
Cash and due from financial institutions $ 10,232   $ 11,101   $ 10,581  
Interest bearing deposits in other financial institutions   92,671     65,624     70,022  
Federal funds sold   5,375     4,923     8,559  
Cash and cash equivalents   108,278     81,648     89,162  
       
Time deposits in other financial institutions   2,185     2,187     4,683  
Securities available for sale   235,032     228,214     137,372  
       
Gross loans   441,997     408,232     373,263  
Allowance for loan losses   (4,575 )   (4,574 )   (4,003 )
Paycheck Protection Program Loans   15,068     27,593     46,639  
Net loans   452,490     431,251     415,899  
       
Bank owned life insurance   10,288     10,236     10,079  
Restricted equity securities   3,228     3,221     2,695  
Premises and equipment, net   405     468     454  
Accrued interest receivable   2,260     2,500     2,447  
Deferred tax asset, net   -     352     -  
Other assets   6,531     6,333     7,808  
       
Total assets $ 820,697   $ 766,410   $ 670,599  
       
       
LIABILITIES AND SHAREHOLDERS' EQUITY      
Deposits      
Non-interest bearing $ 164,176   $ 179,883   $ 158,062  
Interest bearing   543,238     475,616     354,346  
Total deposits   707,414     655,499     512,408  
       
Federal Home Loan Bank advances   12,835     15,533     33,036  
Federal Funds purchased   -     -     -  
Paycheck Protection Program Liquidity Facility advances   -     -     46,639  
Subordinated debt   14,748     14,554     -  
Other liabilities   6,947     6,016     9,303  
Total liabilities   741,944     691,602     601,386  
       
SHAREHOLDERS' EQUITY      
Additional paid-in capital   31,556     31,745     30,591  
Retained earnings   43,446     40,761     36,971  
Accumulated other comprehensive income (loss)   3,751     2,302     1,651  
       
Total shareholders' equity   78,753     74,808     69,213  
       
   Total liabilities and shareholders' equity $ 820,697   $ 766,410   $ 670,599  
       
       
*The information is preliminary, unaudited and based on company data available at the time of presentation.
       
Truxton Corporation
Consolidated Statements of Net Income
(000's)
(Unaudited)
                   
  Three Months Ended   Year To Date
  June 30,
2021*
  March 31,
2021*
  June 30,
2020*
  June 30,
2021*
  June 30,
2020*
Non-interest income                  
Wealth management services $ 3,726   $ 3,430   $ 2,793   $ 7,156   $ 5,535
Service charges on deposit accounts   82     59     60     141     139
Securities gains (losses), net   0     0     0     0     0
Bank owned life insurance income   51     51     53     102     107
Other   50     16     34     66     182
Total non-interest income   3,909     3,556     2,940     7,465     5,963
                   
Interest income                  
Loans, including fees $ 4,434   $ 4,202   $ 4,282   $ 8,636   $ 8,459
Taxable securities   719     661     486     1,380     1,020
Tax-exempt securities   395     379     245     774     441
Interest bearing deposits   46     62     54     108     163
Federal funds sold   1     0     2     1     16
Other interest income   47     20     34     67     46
Total interest income   5,642     5,324     5,103     10,966     10,145
                   
Interest expense                  
Deposits   514     525     371     1,039     1,102
Short-term borrowings   -     -     -     -     -
Subordinated debentures   194     198     -     392     -
Long-term borrowings   72     77     129     149     220
Total interest expense   780     800     500     1,580     1,322
                   
Net interest income   4,862     4,524     4,603     9,386     8,823
                   
Provision for loan losses   0     92     418     92     603
                   
Net interest income after provision for loan losses   4,862     4,432     4,185     9,294     8,220
                   
Total revenue, net   8,771     7,988     7,125     16,759     14,183
                   
Non interest expense                  
Salaries and employee benefits   3,230     3,106     2,797     6,336     5,726
Occupancy   246     221     222     467     422
Furniture and equipment   42     46     30     88     56
Data processing   327     344     290     671     552
Wealth management processing fees   164     180     130     343     254
Advertising and public relations   34     39     25     74     68
Professional services   183     127     156     310     324
FDIC insurance assessments   42     42     38     84     53
Other   221     228     215     449     479
Total non interest expense   4,489     4,333     3,903     8,822     7,934
                   
Income before income taxes   4,282     3,655     3,222     7,937     6,249
                   
Income tax expense   731     574     608     1,305     1,159
                   
Net income $ 3,551   $ 3,081   $ 2,614   $ 6,632   $ 5,090
                   
Earnings per share:                  
Basic $ 1.23   $ 1.07   $ 0.93   $ 2.30   $ 1.83
Diluted $ 1.22   $ 1.06   $ 0.92   $ 2.29   $ 1.81
*The information is preliminary, unaudited and based on company data available at the time of presentation.        
Truxton Corporation
Selected Quarterly Financial data
At Or For The Three Months Ended
(000's)
(Unaudited)
       
  June 30, 2021* March 31, 2021* June 30, 2020*
       
Per Common Share Data      
Net income attributable to shareholders, per share      
Basic $1.23 $1.07 $0.93
Diluted $1.22 $1.06 $0.92
Book value per common share $27.35 $25.93 $24.41
Tangible book value per common share $27.35 $25.93 $24.41
Basic weighted average comm shares 2,814,196 2,794,175 2,740,504
Diluted weighted average common shares 2,825,668 2,806,856 2,768,173
Common shares outstanding at period end 2,879,177 2,885,233 2,834,951
       
       
Selected Balance Sheet Data      
Tangible common equity (TEC) ratio 9.60% 9.76% 10.32%
Average Loans $446,079 $428,864 $419,360
Average earning assets (1) $732,416 $709,535 $599,030
Average total assets $765,391 $743,462 $629,800
Average stockholders' equity $77,148 $77,851 $67,204
       
       
Selected Asset Quality Measures      
Nonaccrual loans 2007 2007 2059
90+ days past due still accruing 38 156 0
Total nonperforming loans 2045 2163 2059
Total nonperforming assets 2045 2163 2059
Net charge offs (recoveries) 1 8 8
Nonperforming loans to assets 0.24% 0.26% 0.31%
Nonperforming assets to total assets 0.25% 0.28% 0.31%
Nonperforming assets to total loans and other real estate 0.45% 0.46% 0.49%
Allowance for loan losses to total loans 1.00% 1.05% 0.95%
Net charge offs (recoveries) to average loans 0.00% 0.00% 0.00%
       
       
Capital Ratios (Bank Subsidiary Only)      
Tier 1 leverage 9.47% 9.39% 9.82%
Common equity tier 1 13.80% 13.99% 13.61%
Total risk-based capital 14.70% 14.92% 14.49%
       
Selected Performance Ratios      
Efficiency ratio 51.67% 53.62% 54.22%
Return on average assets (ROA) 1.86% 1.68% 1.67%
Return on average stockholders' equity (ROE) 18.46% 16.05% 15.64%
Return on tangible common equity (ROTCE) 18.46% 16.05% 15.64%
Net interest margin 2.71% 2.64% 3.13%
       
*The information is preliminary, unaudited and based on company data available at the time of presentation.  
       
(1) Average earning assets is the daily average of earning assets. Earning assets consists of loans, mortgage loans held for sale, federal funds sold, deposits with banks, investment securities and restricted equity securities.
Truxton Corporation
Yield Tables
For The Periods Indicated
(000's)
(Unaudited)
 
The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest earning assets and interest bearing liabilities and the average interest rate for interest earning assets and interest bearing liabilities, net interest spread and net interest margin for the periods indicated below:
                       
  Three Months Ended   Three Months Ended   Three Months Ended
  June 30, 2021*   March 31, 2021*   June 30, 2020*
                       
  Average
Balances
Rates/
Yields (%)
Interest
Income/
Expense
  Average
Balances
Rates/
Yields (%)
Interest
Income/
Expense
  Average
Balances
Rates/
Yields (%)
Interest
Income/
Expense
                       
Earning Assets                      
   Loans $ 446,079   3.64 $ 4,049   $ 428,864   3.65 $ 3,861   $ 419,360   3.92 $ 4,092
   Loan fees $ 0   0.35 $ 385   $ 0   0.32 $ 342   $ 0   0.19 $ 189
      Loans with fees $ 446,079   3.99 $ 4,433   $ 428,864   3.97 $ 4,203   $ 419,360   4.11 $ 4,281
   Mortgage loans held for sale $ 108   3.16 $ 1   $ 96   2.90 $ 1   $ 87   5.20 $ 1
   Federal funds sold $ 2,124   0.06 $ 0   $ 2,173   0.05 $ 0   $ 5,372   0.12 $ 2
   Deposits with banks $ 53,857   0.34 $ 46   $ 66,900   0.37 $ 62   $ 49,801   0.44 $ 54
   Investment securities - taxable $ 164,584   1.75 $ 719   $ 149,117   1.77 $ 660   $ 90,256   2.15 $ 486
   Investment securities - tax-exempt $ 65,665   3.25 $ 395   $ 62,385   3.29 $ 379   $ 34,403   3.86 $ 245
      Total Earning Assets $ 732,416   3.14 $ 5,594   $ 709,535   3.10 $ 5,305   $ 599,279   3.46 $ 5,069
Non interest earning assets                      
   Allowance for loan losses   (4,575 )         (4,541 )         (3,702 )    
   Cash and due from banks $ 10,601         $ 10,346         $ 8,776      
   Premises and equipment $ 403         $ 460         $ 400      
   Accrued interest receivable $ 2,114         $ 2,209         $ 1,989      
   Other real estate $ 0         $ 0         $ 0      
   Other assets $ 20,112         $ 19,614         $ 20,726      
   Unrealized gain (loss) on inv. securities   4,320           5,839           2,332      
      Total Assets $ 765,391         $ 743,462         $ 629,800      
Interest bearing liabilities                      
   Interest bearing demand $ 34,695   0.18 $ 15   $ 36,530   0.39 $ 35   $ 33,084   0.22 $ 18
   Savings and Money Market $ 559,805   0.34 $ 470   $ 530,414   0.35 $ 464   $ 408,757   0.30 $ 300
   Time deposits - Retail $ 9,920   0.61 $ 15   $ 8,291   0.73 $ 15   $ 10,977   1.24 $ 34
   Time Deposits - Wholesale $ 20,271   0.28 $ 14   $ 24,299   0.19 $ 11   $ 2,087   3.72 $ 19
      Total interest bearing deposits $ 624,691   0.33 $ 514   $ 599,534   0.36 $ 525   $ 454,905   0.33 $ 371
   Federal home Loan Bank advances $ 14,603   1.95 $ 72   $ 15,981   1.93 $ 77   $ 35,720   1.13 $ 102
   Subordinated debt $ 14,679   5.23 $ 194   $ 14,798   5.34 $ 198   $ 0   0.00 $ 0
   Other borrowings $ 1,090   0.98 $ 0   $ 1,139   0.61 $ 0   $ 32,931   0.33 $ 27
      Total borrowed funds $ 30,371   3.47 $ 266   $ 31,918   3.44 $ 275   $ 68,651   0.74 $ 129
      Total interest bearing liabilities $ 655,062   0.48 $ 780   $ 631,452   0.51 $ 800   $ 523,556   0.38 $ 500
Net interest rate spread   2.66 $ 4,814     2.59 $ 4,505     3.08 $ 4,574
   Non-interest bearing deposits $ 28,186         $ 28,242         $ 31,315      
   Other liabilities $ 4,995         $ 5,916         $ 7,725      
   Stockholder's equity $ 77,148         $ 77,851         $ 67,204      
      Total Liabilities and Stockholder's Equity $ 765,391         $ 743,462         $ 629,800      
Cost of funds   0.46       0.49       0.36  
Net interest margin   2.71       2.64       3.13  
                       
*The information is preliminary, unaudited and based on company data available at the time of presentation.            
                       
Yield Table Assumptions - Average loan balances are inclusive of nonperforming loans. Yields computed on tax-exempt instruments are on a tax equivalent basis. Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period. Changes in net interest income are attributed to either changes in average balances (volume change) or changes in average rates (rate change) for earning assets and sources of funds on which interest is received or paid. Volume change is calculated as change in volume times the previous rate while rate change is change in rate times the previous volume. Changes not due solely to volume or rate changes are allocated to volume change and rate change in proportion to the relationship of the absolute dollar amounts of the change in each category.
Truxton Corporation
Yield Tables
For The Periods Indicated
(000's)
(Unaudited)
 
The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest earning assets and interest bearing liabilities and the average interest rate for interest earning assets and interest bearing liabilities, net interest spread and net interest margin for the periods indicated below:
                   
  Six Months Ended     Six Months Ended  
  June 30, 2021*     June 30, 2020*  
                   
  Average
Balances
Rates/
Yields (%)
Interest
Income/
Expense
    Average
Balances
Rates/
Yields (%)
Interest
Income/
Expense
 
                   
Earning Assets                  
   Loans $ 437,519   4.21 $ 7,910     $ 393,688   4.21 $ 8,251  
   Loan fees $ 0   0.12 $ 725     $ 0   0.12 $ 228  
      Loans with fees $ 437,519   4.33 $ 8,635     $ 393,688   4.33 $ 8,479  
   Mortgage loans held for sale $ 102   4.05 $ 2     $ 105   4.05 $ 2  
   Federal funds sold $ 2,148   0.73 $ 1     $ 4,258   0.73 $ 16  
   Deposits with banks $ 60,342   0.88 $ 108     $ 37,157   0.88 $ 163  
   Investment securities - taxable $ 156,893   2.29 $ 1,380     $ 88,960   2.29 $ 1,020  
   Investment securities - tax-exempt $ 64,034   3.89 $ 774     $ 30,671   3.89 $ 441  
      Total Earning Assets $ 721,038   3.72 $ 10,898     $ 554,839   3.72 $ 10,121  
Non interest earning assets                  
   Allowance for loan losses   (4,558 )           (3,557 )      
   Cash and due from banks $ 10,474           $ 8,943        
   Premises and equipment $ 431           $ 353        
   Accrued interest receivable $ 2,162           $ 1,820        
   Other real estate $ 0           $ 0        
   Other assets $ 19,870           $ 19,489        
   Unrealized gain (loss) on inv. securities   5,075             2,180        
      Total Assets $ 754,492           $ 584,068        
Interest bearing liabilities                  
   Interest bearing demand $ 35,608   0.29 $ 50     $ 32,976   0.45 $ 74  
   Savings and Money Market $ 545,191   0.35 $ 933     $ 388,489   0.05 $ 905  
   Time deposits - Retail $ 9,110   0.67 $ 30     $ 10,737   1.35 $ 72  
   Time Deposits - Wholesale $ 22,274   0.23 $ 25     $ 3,788   2.75 $ 52  
      Total interest bearing deposits $ 612,182   0.34 $ 1,039     $ 435,990   0.51 $ 1,103  
   Federal home Loan Bank advances $ 15,288   1.94 $ 149     $ 28,335   1.34 $ 193  
   Subordinated debt $ 14,738   5.58 $ 392     $ 0   0.00 $ 0  
   Other borrowings $ 1,114   0.86 $ 0     $ 17,193   0.32 $ 27  
      Total borrowed funds $ 31,140   3.45 $ 541     $ 45,528   0.96 $ 220  
      Total interest bearing liabilities $ 643,323   0.49 $ 1,580     $ 481,518   0.55 $ 1,323  
Net interest rate spread   2.63 $ 9,318       3.17 $ 8,799  
   Non-interest bearing deposits $ 28,214           $ 29,393        
   Other liabilities $ 5,459           $ 6,833        
   Stockholder's equity $ 77,497           $ 66,319        
      Total Liabilities and Stockholder's Equity $ 754,492           $ 584,063        
Cost of funds   0.47         0.52    
Net interest margin   2.68         3.24    
                   
*The information is preliminary, unaudited and based on company data available at the time of presentation.      
                   
Yield Table Assumptions - Average loan balances are inclusive of nonperforming loans. Yields computed on tax-exempt instruments are on a tax equivalent basis. Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period. Changes in net interest income are attributed to either changes in average balances (volume change) or changes in average rates (rate change) for earning assets and sources of funds on which interest is received or paid. Volume change is calculated as change in volume times the previous rate while rate change is change in rate times the previous volume. Changes not due solely to volume or rate changes are allocated to volume change and rate change in proportion to the relationship of the absolute dollar amounts of the change in each category.
Investor Relations Media Relations
Andrew May Tamara Schoeplein
615-515-1707 615-515-1714
andrew.may@truxtontrust.com tamara.schoeplein@truxtontrust.com