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

White River Bancshares Co. Earns Record $1.55 Million, or $1.60 Per Diluted Share, for First ...

April 19, 2021 GMT

FAYETTEVILLE, Ark., April 19, 2021 (GLOBE NEWSWIRE) -- White River Bancshares Company (OTCQX: WRIV), (the “Company”) the holding company for Signature Bank of Arkansas (the “Bank”), today reported net income increased 23.0% to $1.55 million, or $1.60 per diluted share, in the first quarter of 2021, compared to $1.26 million, or $1.30 per diluted share, in the fourth quarter of 2020 and increased 109.1% compared to $742,000, or $0.77 per diluted share, in the first quarter of 2020. All financial results are unaudited.

“We produced record results for the first quarter of 2021, with strong top and bottom-line revenue growth, double digit loan and deposit growth and an improving net interest margin, compared to the first quarter a year ago,” said Gary Head, President and Chief Executive Officer. “Despite the ongoing challenges created by the COVID-19 pandemic, and the related economic conditions, we made progress in several areas of the business, as we continued to support our customers, communities and employees. We are proud of our team and their accomplishments, as it is the investment in our people that drives our success.”

ADVERTISEMENT

“Deposit balances ended the quarter at record levels, with a second round of Paycheck Protection Program (“PPP”) loans and two additional federal stimulus payments contributing to strong quarterly deposit growth,” said Scott Sandlin, Chief Strategy Officer. “The investment we have made in our digital platform is helping us grow new client relationships and gather low-cost deposits. Additionally, we continue to lower the cost of deposits by bringing in more business and personal checking accounts and reducing our reliance on higher-cost CDs.”

“From the beginning of the pandemic, we were active with our customers in the PPP offered through the Small Business Administration (“SBA”),” said Brant Ward, Chief Operating Officer. “After the SBA’s first round of the PPP concluded on August 8, 2020, we originated $20.7 million in PPP loans, helping 274 local businesses in our markets in Arkansas. The first round of PPP generated total PPP loan fees receivable of approximately $680,000. As of March 31, 2021, we have received payment from the SBA for 166 borrowers totaling $7.8 million.”

“On December 27, 2020, additional COVID-19 stimulus relief was signed into law that allowed for a further round of PPP lending,” Ward continued. “The program offered new PPP loans for companies that did not receive PPP funds in 2020 in addition to a second draw loan targeted at hard-hit businesses that had already used their initial PPP proceeds. We immediately began helping our customers with this second round of PPP lending during the first quarter of 2021, and, at March 31, 2021, we had originated $7.7 million in new PPP loans during this second round of funding. Approximately $402,000 of the income recognized during the first quarter of 2021 was related to origination fees from these second round PPP loans. We will continue to help our customers until the program concludes at the end of May.”

ADVERTISEMENT

“In addition to PPP loans, we added additional programs to support our customers experiencing financial hardship as a result of the pandemic. These assistances included payment forbearance agreements with some customers for periods of up to six months. At the peak of our assistance, at June 30, 2020, we had deferred payment on 120 loans totaling $79.7 million. As of March 31, 2021, only 9 loans totaling $1.8 million were still in deferral,” said Jeff Maland, Chief Risk Officer. “We are optimistic about the underlying quality of deferred loans, as most are longtime customer relationships who carry a strong guarantor support. Additionally, we feel the loan portfolio is well positioned to handle any future economic impact from the pandemic, with less than 1% of the total portfolio in hotels, restaurants, and energy loans as of the end of the first quarter.”

The table below presents selected information on loans that remained on COVID-19 deferrals at the periods indicated.

 % of Total Loan Portfolio Deferred Loan Balance Number of Loans
   (In thousands)  
June 30, 202014.25% $79,691 120
September 30, 20202.05   12,003 28
December 31, 20200.31   1,915 12
March 31, 20210.28   1,836 9
        

First Quarter 2021 Financial Highlights:

  • First quarter net income increased 109.1% to $1.55 million, or $1.60 per diluted share, compared to $742,000, or $0.77 per diluted share, in the first quarter of 2020.
  • There was no provision for loan losses in the first quarter. This compares to a $458,000 provision in the preceding quarter and $677,000 provision in the first quarter of 2020.
  • First quarter net interest margin (“NIM”) improved to 3.82%, compared to 3.50% in the preceding quarter and 3.64% in the first quarter a year ago.
  • Net loans increased 13.8% to $635.0 million at March 31, 2021, compared to $558.2 million at March 31, 2020.
  • Total deposits increased 15.3% to $682.6 million at March 31, 2021, compared to $592.1 million a year ago.
  • Non-interest-bearing deposits increased 58.3% to $189.0 million at March 31, 2021, compared to $119.4 million a year ago.
  • Nonperforming assets were almost nil, or 0.00% of total assets, at March 31, 2021, and at December 31, 2020. This compares to nonperforming assets of $1.5 million, or 0.21% of total assets, at March 31, 2020.
  • Book value per common share increased to $77.63 at March 31, 2021, from $72.25 a year ago.
  • Total risk-based capital ratio was 12.95% and Tier 1 leverage ratio was 10.90% for the Bank at March 31, 2021.

Income Statement

The Company’s net interest margin was 3.82% in the first quarter of 2021, an 18-basis point improvement compared to 3.64% in the first quarter of 2020, and a 32 basis point improvement compared to 3.50% in the prior quarter.

First quarter net interest income was $7.0 million, compared to $6.0 million in the first quarter of 2020. Total interest income remained relatively unchanged at $8.2 million in the first quarter of 2021, from the first quarter of 2020. Total interest expense decreased by 41.4% to $1.3 million in the first quarter of 2021, from $2.2 million during the first quarter of 2020.  

Non-interest income increased 62.3% to $1.7 million in the first quarter of 2021, compared to $1.1 million in the first quarter a year ago. The Company benefitted from higher wealth management fee income and substantially higher secondary market fee income compared to the first quarter in the prior year.

Non-interest expense increased to $6.6 million in the first quarter of 2021, compared to $5.4 million in the first quarter of 2020. Higher professional services related to a one-time expense associated with a conversion fee for digital, core and EFT platforms contributed to the increase during the first quarter of 2021. Higher salaries and benefits also contributed to the increase compared to a year ago.

Balance Sheet Review

Total assets increased by 13.3% to $806.0 million at March 31, 2021, from $711.6 million at March 31, 2020, and increased 7.5% compared to $749.9 million at December 31, 2020. Cash and cash equivalents increased to $60.8 million at March 31, 2021 from $53.3 million a year ago. Investment securities increased to $68.9 million at March 31, 2021 from $64.2 million a year ago.

Loans, net of allowance for loan losses, increased 13.8% to $635.0 million at March 31, 2021, compared to $558.2 million a year ago, and increased 4.4% compared to $608.4 million three months earlier.   Through the close of the first round of the program on August 8, 2020, the Bank had funded approximately 274 PPP loans totaling $20.7 million to both existing and new customers. As of March 31, 2021, $11.0 million in PPP loans from round one, and $7.7 million in new PPP loans from round two, remained on the books.

Deposit balances remained at record levels, with a second round of PPP and two additional federal stimulus payments contributing to strong quarterly deposit growth. Total deposits increased 15.3% to $682.6 million at March 31, 2021, compared to $592.1 million a year ago and increased 8.7% compared to $627.8 million at December 31, 2020, with non-interest bearing deposits increasing 58.3% to $189.0 million at March 31, 2021, compared to $119.4 million a year ago.

FHLB advances totaled $17.0 million at March 31, 2021 from $19.9 million at March 31, 2020. Total stockholders’ equity increased 7.3% to $75.2 million at March 31, 2021 from $70.1 million at March 31, 2020 and increased 1.4% when compared to $74.2 million at December 31, 2020. Book value per common share increased to $77.63 at March 31, 2021 from $72.25 at March 31, 2020, and $76.58 at December 31, 2020.

Credit Quality

Due to excellent credit quality and a strong allowance for loan losses, the Company reported no provision for loan losses in the first quarter of 2021. This compares to a $458,000 provision for loan losses during the fourth quarter of 2020, and $677,000 in the first quarter of 2020. “Our credit quality remains exemplary, and we believe our current reserve level is adequate to cover potential loan losses,” said Head.

There were no nonperforming loans at March 31, 2021, or at December 31, 2020. This compared to $1.5 million in nonperforming loans at March 31, 2020. Additionally, there were no nonperforming assets at March 31, 2021, or at December 31, 2020, compared with $1.5 million in nonperforming assets at March 31, 2020. Total non-performing assets were 0.00% of total assets at March 31, 2021, 0.00% at December 31, 2020, and 0.21% at March 31, 2020.

The allowance for loan losses was $8.7 million, or 1.37% of total loans, at March 31, 2021, when excluding the $18.7 million of PPP loans, which are 100% guaranteed by the SBA. This compared to $7.4 million, or 1.33% of total loans, at March 31, 2020. Net loan recoveries were $10,000 in the first quarter of 2021, compared to net charge-offs of $194,000 in the fourth quarter of 2020, and net loan recoveries of $15,000 in the first quarter of 2020.

As of March 31, 2021, the Bank had 9 loans totaling $1.8 million within the deferral process.

Capital

The Bank’s capital ratios continued to exceed regulatory “well-capitalized” requirements, with a Tier 1 leverage ratio of 10.90%, Common equity tier 1 capital ratio of 11.73%, Tier 1 risk-based capital ratio of 11.73% and Total capital ratio of 12.95%, at March 31, 2021.

About White River Bancshares Company

White River Bancshares Company is the single bank holding company for Signature Bank of Arkansas. Both are headquartered in Fayetteville, Arkansas. The Bank has locations in Fayetteville, Springdale, Bentonville, Rogers and Brinkley, Arkansas. Founded in 2005, Signature Bank of Arkansas provides a full line of financial services to small businesses, families and farms.  White River Bancshares Company  (OTCQX: WRIV), trades on the OTCQX® Best Market.  

About the Region

White River Bancshares Company is located in thriving Northwest Arkansas in the Fayetteville-Springdale-Rogers MSA. The region is home to the corporate headquarters for Walmart Stores Inc, Sam’s Club, Tyson Foods, Simmons Foods, and J.B. Hunt Transport. Hundreds of other market-leading companies including Procter & Gamble, Johnson & Johnson, Coca-Cola and Rubbermaid maintain offices in the region in order to maintain their relationships with the locally-based Fortune 500 companies. Northwest Arkansas is also home to the state’s flagship public educational institution, The University of Arkansas and its Sam M. Walton College of Business. The region has seen significant growth in its medical and arts infrastructures with the continued expansion of Washington Regional Medical System, Northwest Medical System, Mercy Health System of Northwest Arkansas and Arkansas Children’s Hospital Northwest. Crystal Bridges Museum of American Art and the Walton Arts Center have led the expansion of the arts. Northwest Arkansas has been repeatedly recognized in recent years as one of the best places to live in the country and remains one of the nation’s fastest-growing regions.

Forward Looking Statements

This press release contains statements about future events. These forward-looking statements, which are based on certain assumptions of management of the Company and the Bank and describe our future plans, strategies and expectations, can generally be identified by use of forward-looking terminology such as “may,” “will,” “believe,” “plan,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions or the negative of those terms. Our ability to predict results of future events and the actual effect of future plans or strategies are inherently uncertain and actual results may differ materially from those predicted in such forward-looking statements. Factors that could have a material adverse effect on our operations and future prospects or that could affect the outcome of such forward-looking statements include, but are not limited to, changes in interest rates; the economic health of the local real estate market; general economic conditions; credit deterioration in our loan portfolio that would cause us to increase our allowance for loan losses; legislative or regulatory changes; technological developments; monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality or composition of our loan and securities portfolios; demand for loan products in our market areas; deposit flows and costs of capital; competition; retention and recruitment of qualified personnel; demand for financial services in our market areas; and changes in accounting principles, policies, and guidelines. These risks and uncertainties should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements. The Company does not undertake and specifically declines any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

WHITE RIVER BANCSHARES COMPANY
CONSOLIDATED BALANCE SHEETS
March 31, 2021, December 31, 2020 and March 31, 2020
       
UNAUDITEDMarch 31, 2021 December 31, 2020 March 31, 2020
       
ASSETS
       
Cash and due from banks$60,216,957  $22,904,291  $52,796,917 
Federal funds sold 573,134   100,089   489,448 
       
Total cash and cash equivalents 60,790,091   23,004,380   53,286,365 
       
Investment securities 68,937,591   73,100,506   64,231,594 
Loans held for sale 7,782,522   10,871,270   2,641,614 
Loans, net of allowance for loan losses 634,992,334   608,391,471   558,187,421 
Premises and equipment, net 24,669,345   25,140,669   24,530,411 
Foreclosed assets held for sale 100   100   100 
Accrued interest receivable 1,883,499   2,705,354   2,072,301 
Deferred income taxes 1,848,883   1,518,115   1,575,948 
Other investments 2,894,085   2,891,285   2,873,285 
Other assets 2,161,705   2,320,711   2,228,236 
       
  $805,960,155  $749,943,861  $711,627,275 
       
LIABILITIES AND STOCKHOLDERS' EQUITY
       
Deposits:      
Demand deposits- non-interest bearing$188,958,889  $172,016,886  $119,398,336 
 - interest bearing 253,269,377   203,407,688   166,153,663 
Savings deposits  22,126,159   21,051,019   14,027,963 
Time deposits- under $250M 116,989,664   125,998,519   166,663,942 
 - $250M and over 101,253,092   105,309,981   125,835,712 
      
Total deposits 682,597,181   627,784,093   592,079,616 
       
Federal Home Loan Bank advances 16,950,930   17,056,909   19,869,137 
Notes payable 10,779,101   10,772,790   10,753,991 
Accrued interest payable 425,731   382,474   876,692 
Other liabilities  19,982,625   19,733,128   17,963,323 
       
Total liabilities 730,735,568   675,729,394   641,542,759 
       
Stockholders' equity:     
Common stock 9,763   9,763   9,763 
Surplus 88,082,809   88,010,761   87,752,461 
Accumulated deficit (12,921,378)  (14,474,203)  (17,555,735)
Treasury stock, at cost (431,865)  (431,865)  (387,022)
Accumulated other comprehensive income 485,258   1,100,011   265,049 
       
Total stockholders' equity 75,224,587   74,214,467   70,084,516 
       
  $805,960,155  $749,943,861  $711,627,275 
             
WHITE RIVER BANCSHARES COMPANY
CONSOLIDATED STATEMENTS OF INCOME
For the three months ended March 31, 2021, December 31, 2020 and March 31, 2020
      
 For the Three Months Ended
UNAUDITEDMarch 31, 2021 December 31, 2020 March 31, 2020
      
Interest income:     
Loans, including fees$7,858,931 $7,463,396  $7,735,747 
Investment securities 365,802  331,474   359,413 
Federal funds sold and other 5,383  3,392   83,925 
      
Total interest income 8,230,116  7,798,262   8,179,085 
      
Interest expense:     
Deposits 1,002,824  1,326,327   1,891,372 
Federal Home Loan Bank advances 103,749  103,809   117,248 
Notes payable 167,874  167,745   167,870 
Federal funds purchased and other 2,109  1,309   32 
      
Total interest expense 1,276,556  1,599,190   2,176,522 
      
Net interest income 6,953,560  6,199,072   6,002,563 
Provision for loan losses -  458,000   677,000 
      
Net interest income after provision for loan losses 6,953,560  5,741,072   5,325,563 
      
Non-interest income:     
Service charges and fees on deposits 126,264  130,374   174,174 
Wealth management fee income 506,039  474,031   468,305 
Secondary market fee income 921,857  894,411   288,749 
Loss on sales and write-downs of foreclosed assets -  (185,550)  (1,917)
Other 181,328  192,133   140,020 
      
Total non-interest income 1,735,488  1,505,399   1,069,331 
      
Non-interest expense:     
Salaries and benefits 4,032,581  3,641,192   3,670,178 
Occupancy and equipment 644,033  684,502   649,038 
Data processing 586,399  367,253   315,592 
Marketing and business development 69,808  209,519   126,936 
Professional services 936,803  433,752   392,376 
Other 343,918  140,323   250,563 
      
Total non-interest expense 6,613,542  5,476,541   5,404,683 
      
Income before income taxes 2,075,506  1,769,930   990,211 
      
Income tax provision 522,681  507,097   247,736 
      
Net income$1,552,825 $1,262,833  $742,475 
      
Basic earnings per common share$1.60 $1.30  $0.77 
      
Diluted earnings per common share$1.60 $1.30  $0.77 
           
White River Bancshares Company     
Selected Financial Data  Three Months Ended 
UNAUDITEDMarch 31, 2021 December 31, 2020 March 31, 2020
      
Selected Financial Condition Data: End of Period Balances    
Assets$805,960,155  $749,943,861  $711,627,275 
Investment Securities 68,937,591   73,100,506   64,231,594 
Loans, gross 651,470,670   627,948,824   568,217,563 
Allowance for Loan Losses 8,695,814   8,686,083   7,388,528 
Deposits 682,597,181   627,784,093   592,079,616 
FHLB Advances 16,950,930   17,056,909   19,869,137 
Notes Payable 10,779,101   10,772,790   10,753,991 
Common Shareholders' Equity 75,224,587   74,214,467   70,084,516 
      
Selected Financial Condition Data: Average Balances     
Assets$768,712,888  $735,449,136  $696,324,277 
Earning Assets 738,370,954   705,226,210   663,389,661 
Investment Securities 70,606,315   71,221,639   58,681,569 
Loans, gross 639,404,515   616,463,713   572,011,997 
Deposits 639,422,194   612,098,458   577,553,407 
FHLB Advances & Other Borrowings 22,992,223   18,780,682   18,510,101 
Notes Payable 10,775,151   10,769,161   10,750,063 
Common Shareholders' Equity 74,657,832   73,485,866   69,760,807 
      
Selected Operating Results:     
Interest Income$8,230,116  $7,798,262  $8,179,085 
Interest Expense 1,276,556   1,599,190   2,176,522 
Net Interest Income 6,953,560   6,199,072   6,002,563 
Provision for Loan Losses -   458,000   677,000 
Net Interest Income After Provision for Loan Losses 6,953,560   5,741,072   5,325,563 
Noninterest Income 1,735,488   1,505,399   1,069,331 
Noninterest Expense 6,613,542   5,476,541   5,404,683 
Income Before Income Taxes 2,075,506   1,769,930   990,211 
Income Tax Provision 522,681   507,097   247,736 
Net Income$1,552,825  $1,262,833  $742,475 
      
Basic Net Income per Common Share$1.60  $1.30  $0.77 
Diluted Net Income per Common Share 1.60   1.30   0.77 
Dividends Paid per Common Share -   -   - 
Book Value Per Common Share 77.63   76.58   72.25 
Common Shares Outstanding 969,065   969,065   969,998 
Diluted Common Shares Outstanding 969,065   969,065   969,998 
Basic Weighted Average Common Shares Outstanding 969,065   969,069   969,998 
Diluted Weighted Average Common Shares Outstanding 969,065   969,069   969,998 
      
Selected Ratios:     
Return on Average Assets 0.82%  0.68%  0.43%
Return on Average Common Shareholders' Equity 8.44%  6.84%  4.28%
Average Common Shareholders' Equity to Average Assets 9.71%  9.99%  10.02%
Net Interest Margin 3.82%  3.50%  3.64%
Efficiency 76.11%  71.08%  76.42%
      
Selected Asset Quality:     
Net (Recoveries) Charge-offs$(9,731) $194,071  $(15,031)
Classified Assets 4,538,064   4,439,839   1,769,453 
Nonperforming Loans -   -   1,509,590 
Nonperforming Assets 100   100   1,509,690 
Total Nonperforming Loans to Total Loans 0.00%  0.00%  0.27%
Total Nonperforming Loans to Total Assets 0.00%  0.00%  0.21%
Total Nonperforming Assets to Total Assets 0.00%  0.00%  0.21%
            
Contact:    Scott Sandlin, Chief Strategy Officer
479-684-3754