Third Century Bancorp Releases Earnings for the Quarter Ended March 31, 2022

FRANKLIN, Ind.–(BUSINESS WIRE)–OTCPINK: TDCB – Third Century Bancorp (“Company”), the holding company for Mutual Savings Bank (“Bank”), announced it recorded net income of $367,000 for the quarter ended March 31, 2022, or $0.31 per basic and diluted share, compared to net income of $414,000 for the quarter ended March 31, 2021, or $0.35 per basic and diluted share.

“Our first quarter 2022 growth continued to be significant for the company. In addition to a sub-debt capital raise of $10 million, our wholly owned subsidiary Mutual Savings Bank had significant balance sheet growth in normal operations,” stated David A. Coffey, President and CEO. “On the asset side of the balance sheet, our net loan balances increased nearly $7.2 million from year end 2021 due to strong commercial loan demand. On the liability side of the balance sheet, we saw deposit balance increase nearly $17.3 million from year end 2021 due to new account activity and existing customer balance growth.” Coffey concluded, “As the economic conditions continue to evolve this year, we continue to pursue our business strategy of quality growth and improved returns for our stockholders.”

For the quarter ended March 31, 2022, net income decreased $47,000, or 11.35%, to $367,000 as compared to $414,000 for the same period in the prior year. The decrease in net income for the three-month period ended March 31, 2022 was driven primarily as a result of the $198,000, or 28.62% decrease in non-interest income as compared to the same period in the prior year. The decrease in non-interest income was due primarily to a $180,000, or 47.27% decrease in the gains on the sale of one-to-four family residential mortgage loans sold to Freddie Mac, as a result of the rising interest rate environment. The decrease in non-interest income was partially offset by an increase in net interest income of $173,000, or 10.98%, which was the result of an increase of $156,000, or 8.69%, in interest income and a decrease of $17,000, or 7.76% in interest expense as compared to the same period in the prior year.

The increase in net interest income for the quarter ended March 31, 2022 was partially supported by the $45,000 decrease in the provision for loan losses compared to the same period in 2021. The decrease in provision expense was due to the improving economic conditions resulting from the COVID-19 pandemic. The Company had no net charge-offs during the quarters ended March 31, 2022 and March 31, 2021.

Total assets increased $20.0 million to $261.6 million at March 31, 2022 from $241.6 million at December 31, 2021, an increase of 8.31%. The increase was primarily due to a $7.7 million, or 9.10%, increase in investment securities, available-for-sale to $92.3 million and a $7.5 million, or 5.24%, increase in loans held-for-investment at March 31, 2022. These increases were primarily funded by a $17.3 million, or 8.05%, increase in total deposits, and the addition of $10.0 million in subordinated debt notes issued during the quarter. Total deposits were $231.9 million at March 31, 2022, up from $214.6 million as of December 31, 2021. Federal Home Loan Bank advances were $3.0 million at March 31, 2022 as compared to $5.0 million at December 31, 2021. At March 31, 2022, the weighted average rate of all Federal Home Loan Bank advances was 1.73% compared to 1.45% at December 31, 2021, and the weighted average maturity was 5.1 years at March 31, 2022 compared to 4.3 years at December 31, 2021. Total loans held-for-investment grew to $151.5 million at March 31, 2022 from $142.8 million at December 31, 2021, an increase of 5.24%.

The allowance for loan losses remained the same at $1.9 million at March 31, 2022 and at December 31, 2021. The allowance for loan losses totaled 1.24% of total loans as of March 31, 2022, as compared to 1.30% of total loans as of December 31, 2021. Nonperforming loans totaled $57,000 or 0.04%, of total loans as of March 31, 2022 as compared to $237,000 or 0.16%, of total loans as of December 31, 2021.

Stockholders’ equity was $16.5 million at March 31, 2022, down from $21.5 million at December 31, 2021. Stockholders’ equity decreased by $5.0 million during the quarter ended March 31, 2022 as a result of a change in net unrealized loss of $5.4 million of available-for-sale securities due to the increase in market interest rates, partially offset by net income of $367,000. The decrease in stockholders’ equity was also impacted by dividends of $105,000, repurchased stock of $40,000 and stock awards of $8,000. Equity as a percentage of assets decreased to 6.33% at March 31, 2022 compared to 8.91% at December 31, 2021.

During the quarter ended March 31, 2022, the Company repurchased 2,222 shares of common stock at an average cost of $18.00 per share pursuant to the Company’s stock repurchase program. At March 31, 2022, 14,422 shares of common stock have been repurchased by the Company through the stock repurchase program since its inception in January 2021.

Founded in 1890, Mutual Savings Bank is a full-service financial institution based in Johnson County, Indiana. In addition to its main office at 80 East Jefferson Street, Franklin, Indiana, the Bank operates branches in Franklin at 1124 North Main Street, Trafalgar and Greenwood, Indiana.

This press release contains certain forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Certain factors that could cause actual results to differ materially from expected results include the COVID-19 pandemic, changes in the interest rate environment, changes in general economic conditions, inflation, legislative and regulatory changes that adversely affect the business of the Company and the Bank, and changes in the securities markets. Except as required by law, the Company does not undertake any obligation to update any forward-looking statements to reflect changes in belief, expectations or events.

Condensed Consolidated Statements of Income
(unaudited, except for periods ended on or before December 31, 2021)
In thousands, except per share data
 

Three Months Ended

March 31,

 

December 31,

 

March 31,

2022

 

2021

 

2021

Selected Consolidated Earnings Data:
Total Interest Income

$

1,951

$

1,945

$

1,795

Total Interest Expense

 

202

 

143

 

219

Net Interest Income

 

1,749

 

1,802

 

1,576

Provision for Losses on Loans

 

 

 

45

Net Interest Income after Provision for Losses on Loans

 

1,749

 

1,802

 

1,531

Non-interest Income

 

493

 

876

 

690

Non-interest Expense

 

1,856

 

1,945

 

1,761

Income Tax Expense

 

18

 

99

 

46

Net Income

$

367

$

634

$

414

 
Earnings per share – basic

$

0.31

$

0.54

$

0.35

Earnings per share – diluted

$

0.31

$

0.54

$

0.35

 
 

Condensed Consolidated Balance Sheet

(unaudited, except for periods ended on or before December 31, 2021)

In thousands, except per share data

 

 

 

 

 

 

 

March 31,

 

December 31,

 

March 31,

 

 

2022

 

 

 

2021

 

 

 

2021

 

Selected Consolidated Balance Sheet Data:
Assets
Cash and Due from Banks

$

8,699

 

$

4,857

 

$

8,402

 

Investment Securities, Available-for-sale, at fair value

 

92,362

 

 

84,661

 

 

66,938

 

Loans Held-for-Sale

 

402

 

 

738

 

 

302

 

Loans Held-for-Investment

 

151,462

 

 

143,927

 

 

141,715

 

Allowance for Loan Losses

 

1,881

 

 

1,881

 

 

1,838

 

Net Loans

 

149,983

 

 

142,784

 

 

140,179

 

Accrued Interest Receivable

 

802

 

 

760

 

 

720

 

Other Assets

 

9,777

 

 

8,499

 

 

7,644

 

Total Assets

$

261,623

 

$

241,561

 

$

223,883

 

 
Liabilities
Noninterest-bearing Deposits

$

43,144

 

$

40,988

 

$

37,960

 

Interest-bearing Deposits

 

188,790

 

 

173,666

 

 

160,385

 

Total Deposits

 

231,934

 

 

214,654

 

 

198,345

 

FHLB Advances

 

3,000

 

 

5,000

 

 

5,000

 

Subordinated Notes

 

9,734

 

 

 

 

 

Accrued Interest Payable

 

90

 

 

32

 

 

46

 

Accrued Expenses and Other Liabilities

 

313

 

 

342

 

 

519

 

Total Liabilities

 

245,071

 

 

220,028

 

 

203,910

 

Stockholders’ Equity – Net

 

16,552

 

 

21,533

 

 

19,973

 

Total Liabilities and Stockholders’ Equity

$

261,623

 

$

241,561

 

$

223,883

 

 
 

Three Months Ended

dollar figures are in thousands, except per share data

March 31,

 

December 31,

 

March 31,

 

2022

 

 

 

2021

 

 

 

2021

 

Selected Financial Ratios and Other Data:
Interest rate spread during period

 

2.73

%

 

2.94

%

 

2.81

%

Net yield on interest-earning assets

 

3.16

%

 

3.26

%

 

3.36

%

Non-interest expense, annualized, to average assets

 

2.92

%

 

3.23

%

 

3.30

%

Return on average assets, annualized

 

0.58

%

 

1.05

%

 

0.78

%

Return on average equity, annualized

 

7.23

%

 

12.29

%

 

7.98

%

Average equity to assets

 

7.98

%

 

8.58

%

 

9.72

%

 
Average Loans

$

146,384

 

$

143,448

 

$

141,716

 

Average Securities

 

87,430

 

 

83,268

 

 

60,750

 

Average Other Interest-Earning Assets

 

13,275

 

 

11,615

 

 

10,941

 

Total Average Interest-Earning Assets

 

247,089

 

 

238,330

 

 

213,407

 

Average Total Assets

 

254,402

 

 

240,513

 

 

213,453

 

 
Average Noninterest-bearing Deposits

$

43,889

 

$

40,335

 

$

36,637

 

Average Interest-bearing Deposits

 

178,946

 

 

170,457

 

 

149,954

 

Average Total Deposits

 

222,835

 

 

210,792

 

 

186,591

 

Average Wholesale Funding

 

9,171

 

 

5,000

 

 

7,916

 

Average Interest-Bearing Liabilities

 

188,117

 

 

175,457

 

 

157,870

 

 
Average Interest-Earnings Assets to Average Interest-Bearings Liabilities

 

131.35

%

 

135.83

%

 

135.18

%

Non-performing loans to total loans

 

0.04

%

 

0.16

%

 

0.08

%

Allowance for loan losses to total loans outstanding

 

1.24

%

 

1.30

%

 

1.29

%

Allowance for loan losses to non-performing loans

 

3300.00

%

 

793.67

%

 

1701.85

%

Net loan chargeoffs/(recoveries) to average total loans outstanding

 

0.00

%

 

0.00

%

 

0.00

%

Effective income tax rate

 

4.68

%

 

13.51

%

 

10.00

%

Tangible book value per share

$

14.05

 

$

18.28

 

$

16.80

 

Market closing price at the end of quarter

$

17.55

 

$

17.50

 

$

14.20

 

Price-to-tangible book value

 

124.92

%

 

95.75

%

 

84.54

%

 

 

Contacts

David A. Coffey, President and CEO

Ryan W. Cook, Senior Vice President and CFO

Tel. 317-736-7151

Fax 317-736-1726

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