QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
(Address of principal executive offices) |
(Zip Code) |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
Page |
||||||
PART I. |
FINANCIAL INFORMATION | 3 | ||||
Item 1. |
Financial Statements (Unaudited) | 3 | ||||
Consolidated Balance Sheets | 3 | |||||
Consolidated Statements of Net Income | 4 | |||||
Consolidated Statements of Comprehensive Income | 5 | |||||
Consolidated Statements of Changes in Retained Earnings | 6 | |||||
Consolidated Statements of Cash Flows | 7 | |||||
Notes to Unaudited Consolidated Financial Statements | 8 | |||||
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations | 20 | ||||
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk | 29 | ||||
Item 4. |
Controls and Procedures | 29 | ||||
PART II. |
OTHER INFORMATION | 31 | ||||
Item 1. |
Legal Proceedings | 31 | ||||
Item 1A. |
Risk Factors | 31 | ||||
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds | 31 | ||||
Item 3. |
Defaults Upon Senior Securities | 31 | ||||
Item 4. |
Mine Safety Disclosures | 31 | ||||
Item 5. |
Other Information | 31 | ||||
Item 6. |
Exhibits | 32 | ||||
33 |
September 30, 2021 (Unaudited) |
June 30, 2021 |
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Assets |
| |||||||
Cash and due from banks |
$ | $ | ||||||
Short-term investments (defined in footnotes) |
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Total cash and cash equivalents |
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Certificates of deposit |
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Securities available for sale, at fair value |
||||||||
Securities held to maturity, at amortized cost , fair value of $September 30, 2021 and $ |
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Federal Home Loan Bank stock, at cost |
||||||||
Loans, net of allowance for loan losses of $ $ |
||||||||
Premises and equipment, net |
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Accrued interest receivable |
||||||||
Bank-owned life insurance |
||||||||
Deferred tax asset |
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Other assets |
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$ | $ | |||||||
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Liabilities and Retained Earnings |
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Deposits |
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Non-interest bearing |
$ | $ | ||||||
Interest-bearing |
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Total deposits |
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Short-term borrowings |
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Mortgagors’ escrow accounts |
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Accrued expenses and other liabilities |
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Total liabilities |
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Commitments and contingencies (Note 9 ) |
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Retained earnings |
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Accumulated other comprehensive income |
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Total retained earnings |
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|||||
$ | $ | |||||||
|
|
|
|
Three months ended |
||||||||
September 30, 2021 |
September 30, 2020 |
|||||||
Interest and dividend income: |
||||||||
Interest and fees on loans |
$ | $ | ||||||
Interest and dividends on debt securities: |
||||||||
Taxable |
||||||||
Tax exempt |
||||||||
Interest on short-term investments and certificates of deposit |
||||||||
Total interest and dividend income |
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Interest expense: |
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Deposits |
||||||||
Short-term borrowings |
||||||||
Total interest expense |
||||||||
Net interest income |
||||||||
Provision for loan losses |
||||||||
Net interest income, after provision for loan losses |
||||||||
Non-interest income: |
||||||||
Customer service fees |
||||||||
Income on bank-owned life insurance |
||||||||
Gain on sale of securities available for sale |
— | |||||||
Other income |
||||||||
Total non-interest income |
||||||||
Non-interest expense: |
||||||||
Salaries and employee benefits |
||||||||
Occupancy and equipment |
||||||||
Advertising |
||||||||
Data processing |
||||||||
Deposit insurance |
||||||||
Other general and administrative |
||||||||
Total non-interest expense |
||||||||
Income before income taxes |
||||||||
Provision for income taxes |
||||||||
Net income |
$ | $ | ||||||
Three months ended |
||||||||
September 30, 2021 |
September 30, 2020 |
|||||||
Net income |
$ | $ | ||||||
Other comprehensive income: |
||||||||
Change in unrealized holding gains (losses) |
( |
) | ||||||
Reclassification adjustment for net realized gains included in income |
( |
) | — | |||||
Net change in unrealized losses |
( |
) | ( |
) | ||||
Tax effect |
— | |||||||
Net-of-tax |
( |
) | ( |
) | ||||
Comprehensive income |
$ | $ | ||||||
Retained Earnings |
Accumulated Other Comprehensive Income (Loss) |
Total |
||||||||||
Balance at June 30, 2021 |
$ | $ | $ | |||||||||
Comprehensive income (loss) |
( |
) | ||||||||||
Balance at September 30, 2021 |
$ | $ | $ | |||||||||
Retained Earnings |
Accumulated Other Comprehensive Income (Loss) |
Total |
||||||||||
Balance at June 30, 2020 |
$ | $ | $ | |||||||||
Comprehensive income (loss) |
( |
) | ||||||||||
Balance at September 30, 2020 |
$ | $ | $ | |||||||||
Three Months Ended |
||||||||
September 30, 2021 |
September 30, 2020 |
|||||||
Cash flows from operating activities: |
||||||||
Net income |
$ | $ | ||||||
Adjustments to reconcile net income to net cashprovided by operating activities: |
||||||||
Provision for loan losses |
||||||||
Gain on sales of securities available for sale, net |
( |
) | — | |||||
Depreciation and amortization, net |
||||||||
Net change in: |
||||||||
Cash surrender value of bank-owned life insurance |
( |
) | ( |
) | ||||
Accrued interest receivable |
||||||||
Other, net |
( |
) | ||||||
Net cash provided by operating activities |
||||||||
Cash flows from investing activities: |
||||||||
Activity in securities available for sale: |
||||||||
Maturities, prepayments and calls |
||||||||
Sales |
— | |||||||
Activity in securities held to maturity: |
||||||||
Maturities, prepayments and calls |
||||||||
Purchases |
( |
) | ( |
) | ||||
Loan originations and payments, net |
||||||||
Additions to premises and equipment |
( |
) | ( |
) | ||||
Purchase of bank-owned life insurance |
( |
) | — | |||||
Net cash (used in) provided by investing activities |
( |
) | ||||||
Cash flows from financing activities: |
||||||||
Net (decrease) increase in deposits |
( |
) | ||||||
Net (decrease) increase in short-term borrowings |
( |
) | ||||||
Repayments of long-term borrowings |
— | ( |
) | |||||
Net increase in mortgagors’ escrow accounts |
||||||||
Net cash used in financing activities |
( |
) | ( |
) | ||||
Net change in cash and cash equivalents |
( |
) | ||||||
Cash and cash equivalents at beginning of year |
||||||||
Cash and cash equivalents at end of year |
$ | $ | ||||||
Supplemental information: |
||||||||
Interest paid on deposits, short term borrowings and long-term debt |
$ | $ | ||||||
Income taxes paid |
$ | $ |
1. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF BUSINESS |
2. |
RESTRICTIONS ON CASH AND AMOUNTS DUE FROM BANKS |
3. |
SECURITIES |
September 30, 2021 |
||||||||||||||||
(In thousands) |
Amortized |
Gross Unrealized Gains |
Gross Unrealized Losses |
Fair Value |
||||||||||||
Securities available for sale: |
||||||||||||||||
Government-sponsored enterprises: |
||||||||||||||||
Debt obligations |
$ | $ | $ | — | $ | |||||||||||
Mortgage-backed securities |
— | |||||||||||||||
Collateralized mortgage obligations |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total securities available for sale |
$ | $ | $ | — | $ | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Securities held to maturity: |
||||||||||||||||
Government-sponsored enterprises: |
||||||||||||||||
Debt obligations |
$ | $ | $ | — | $ | |||||||||||
Mortgage-backed securities |
( |
) | ||||||||||||||
Collateralized mortgage obligations |
— | — | ||||||||||||||
Municipal bonds |
( |
) | ||||||||||||||
Corporate bonds |
( |
) | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total securities held to maturity |
$ | $ | $ | ( |
) | $ | ||||||||||
|
|
|
|
|
|
|
|
June 30, 2021 |
||||||||||||||||
(In thousands) |
Amortized Cost |
Gross Unrealized Gains |
Gross Unrealized Losses |
Fair Value |
||||||||||||
Securities available for sale: |
||||||||||||||||
Government-sponsored enterprises: |
||||||||||||||||
Debt obligations |
$ | $ | $ | — | $ | |||||||||||
Mortgage-backed securities |
— | |||||||||||||||
Collateralized mortgage obligations |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total securities available for sale |
$ | $ | $ | — | $ | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Securities held to maturity: |
||||||||||||||||
Government-sponsored enterprises: |
||||||||||||||||
Debt obligations |
$ | $ | $ | — | $ | |||||||||||
Mortgage-backed securities |
( |
) | ||||||||||||||
Collateralized mortgage obligations |
— | |||||||||||||||
Municipal bonds |
( |
) | ||||||||||||||
Corporate bonds |
( |
) | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total securities held to maturity |
$ | $ | $ | ( |
) | $ | ||||||||||
|
|
|
|
|
|
|
|
Available for Sale |
Held to Maturity |
|||||||||||||||
(In thousands) |
Amortized |
Fair Value |
Amortized |
Fair Value |
||||||||||||
Within 1 year |
$ | $ | $ | $ | ||||||||||||
Over 1 year through 5 years |
||||||||||||||||
Over 5 years through 10 years |
||||||||||||||||
Over 10 years |
||||||||||||||||
Mortgage-backed securities |
||||||||||||||||
Collateralized mortgage obligations |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | $ | $ | $ | |||||||||||||
|
|
|
|
|
|
|
|
Less Than Twelve Months |
Over Twelve Months |
|||||||||||||||
(In thousands) |
Gross Unrealized Losses |
Fair Value |
Gross Unrealized Losses |
Fair Value |
||||||||||||
September 30, 2021 |
||||||||||||||||
Securities held to maturity: |
||||||||||||||||
Mortgage-backed securities |
$ | $ | $ | $ | ||||||||||||
Municipal bonds |
||||||||||||||||
Corporate bonds |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total temporarily impaired securities held to maturity |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
Less Than Twelve Months |
Over Twelve Months |
|||||||||||||||
(In thousands) |
Gross Unrealized Losses |
Fair Value |
Gross Unrealized Losses |
Fair Value |
||||||||||||
June 30, 2021 |
||||||||||||||||
Securities held to maturity: |
||||||||||||||||
Mortgage-backed securities |
$ | $ | $ | — | $ | — | ||||||||||
Municipal bonds |
— | — | ||||||||||||||
Corporate bonds |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total temporarily impaired securities held to maturity |
$ | $ | $ | — | $ | — | ||||||||||
|
|
|
|
|
|
|
|
4. |
LOANS |
(In thousands) |
September 30, 2021 |
June 30, 2021 |
||||||
Mortgage loans on real estate: |
||||||||
Residential: |
||||||||
1-4 family |
$ |
$ |
||||||
Multifamily |
||||||||
Second mortgages and home equity lines of credit |
||||||||
Commercial |
||||||||
|
|
|
|
|||||
Total mortgage loans on real estate |
||||||||
|
|
|
|
|||||
Other loans: |
||||||||
Consumer |
||||||||
Home improvement |
||||||||
|
|
|
|
|||||
Total other loans |
||||||||
|
|
|
|
|||||
Total loans |
||||||||
Less: Allowance for loan losses |
( |
) |
( |
) | ||||
Net deferred loan fees |
( |
) |
( |
) | ||||
|
|
|
|
|||||
Loans, net |
$ |
$ |
||||||
|
|
|
|
(In thousands) |
Residential Real Estate |
Commercial Real Estate |
Consumer |
Unallocated |
Total |
|||||||||||||||
Allowance for loan losses - September 30, 2021: |
||||||||||||||||||||
Balance at June 30, 2021 |
$ | $ | $ | $ | $ | |||||||||||||||
Provision (credit) for loan losses |
( |
) | ( |
) | ||||||||||||||||
Loans charged-off |
||||||||||||||||||||
Recoveries |
||||||||||||||||||||
Balance at September 30, 2021 |
$ | $ | $ | $ | $ | |||||||||||||||
Allowance for loan losses - September 30, 2020: |
||||||||||||||||||||
Balance at June 30, 2020 |
$ | $ | $ | $ | $ | |||||||||||||||
Provision (credit) for loan losses |
( |
) | ||||||||||||||||||
Loans charged-off |
||||||||||||||||||||
Recoveries |
||||||||||||||||||||
Balance at September 30, 2020 |
$ | $ | $ | $ | $ | |||||||||||||||
September 30, 2021 |
||||||||||||||||||||
Allowance for loan losses for loans individually evaluated for impairment |
$ | $ | $ | $ | $ | |||||||||||||||
Allowance for loan losses for loans collectively evaluated for impairment |
||||||||||||||||||||
Total allowance for loan losses |
$ | $ | $ | $ | $ | |||||||||||||||
Loans individually evaluated and deemed impaired |
$ | $ | $ | $ | $ | |||||||||||||||
Loans collectively evaluated for impairment |
||||||||||||||||||||
Total loans |
$ | $ | $ | $ | $ | |||||||||||||||
June 30, 2021 |
||||||||||||||||||||
Allowance for loan losses for loans individually evaluated for impairment |
$ | $ | $ | $ | $ | |||||||||||||||
Allowance for loan losses for loans collectively evaluated for impairment |
||||||||||||||||||||
Total allowance for loan losses |
$ | $ | $ | $ | $ | |||||||||||||||
Loans individually evaluated and deemed impaired |
$ | $ | $ | $ | $ | |||||||||||||||
Loans collectively evaluated for impairment |
||||||||||||||||||||
Total loans |
$ | $ | $ | $ | $ | |||||||||||||||
September 30, 2021 |
June 30, 2021 |
|||||||||||||||
(In thousands) |
Residential Real Estate |
Commercial Real Estate |
Residential Real Estate |
Commercial Real Estate |
||||||||||||
Pass |
$ |
$ |
$ |
$ |
||||||||||||
Special mention |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ |
$ |
$ |
$ |
|||||||||||||
|
|
|
|
|
|
|
|
5. |
PREMISES AND EQUIPMENT |
(In thousands) |
September 30, 2021 |
June 30, 2021 |
||||||
Land |
$ | $ | ||||||
Bank buildings |
||||||||
Building improvements |
||||||||
Furniture, fixtures and equipment |
||||||||
Leasehold improvements |
||||||||
|
|
|
|
|||||
Less accumulated depreciation and amortization |
( |
) | ( |
) | ||||
|
|
|
|
|||||
$ |
$ |
|||||||
|
|
|
|
6. |
DEPOSITS |
(In thousands) |
September 30, |
June 30, |
||||||
NOW and demand |
$ | $ | ||||||
Regular and other |
||||||||
Money market deposits |
||||||||
|
|
|
|
|||||
Total non-certificate accounts |
||||||||
|
|
|
|
|||||
Term certificates of $ |
||||||||
Term certificates less than $ |
||||||||
|
|
|
|
|||||
Total certificate accounts |
||||||||
|
|
|
|
|||||
Total deposits |
$ | $ | ||||||
|
|
|
|
September 30, 2021 |
June 30, 2021 |
|||||||||||||||
(In thousands) |
Amount |
Weighted Average Rate |
Amount |
Weighted Average Rate |
||||||||||||
Due within 1 year |
$ | % | $ | % | ||||||||||||
Over 1 year to 2 years |
||||||||||||||||
Over 2 years to 3 years |
||||||||||||||||
Over 3 years to 5 years |
||||||||||||||||
|
|
|
|
|||||||||||||
$ | % | $ | % | |||||||||||||
|
|
|
|
7. |
FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS |
8. |
MINIMUM REGULATORY CAPITAL REQUIREMENTS |
Actual |
Minimum Capital Requirement |
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions |
||||||||||||||||||||||
(Dollars in thousands) |
Amount |
Ratio |
Amount |
Ratio |
Amount |
Ratio |
||||||||||||||||||
September 30, 2021: |
||||||||||||||||||||||||
Total capital (to risk weighted assets) |
$ | % | $ | % | $ | % | ||||||||||||||||||
Common equity Tier 1 capital (to risk weighted assets) |
||||||||||||||||||||||||
Tier 1 capital (to risk weighted assets) |
||||||||||||||||||||||||
Tier 1 capital (to adjusted total assets) |
||||||||||||||||||||||||
June 30, 2021: |
||||||||||||||||||||||||
Total capital (to risk weighted assets) |
$ | % | $ | % | $ | % | ||||||||||||||||||
Common equity Tier 1 capital (to risk weighted assets) |
||||||||||||||||||||||||
Tier 1 capital (to risk weighted assets) |
||||||||||||||||||||||||
Tier 1 capital (to adjusted total assets) |
9. |
COMMITMENTS AND CONTINGENCIES |
(In thousands) |
September 30, 2021 |
June 30, 2021 |
||||||
Commitments to grant loans |
$ | $ | ||||||
Unadvanced funds on equity lines of credit |
10. |
EMPLOYEE BENEFIT PLANS |
11. |
FAIR VALUE OF ASSETS AND LIABILITIES |
September 30, 2021 |
||||||||||||||||||||
(In thousands) |
Carrying Value |
Level 1 |
Fair Value Level 2 |
Level 3 |
Total |
|||||||||||||||
Assets: |
||||||||||||||||||||
Cash and cash equivalents |
$ | $ | $ | $ | $ | |||||||||||||||
Certificates of deposits |
||||||||||||||||||||
Securities available for sale |
||||||||||||||||||||
Securities held to maturity |
||||||||||||||||||||
Federal Home Loan Bank of Boston stock |
||||||||||||||||||||
Loans—net |
||||||||||||||||||||
Accrued interest receivable |
||||||||||||||||||||
Liabilities: |
— | |||||||||||||||||||
Deposits |
||||||||||||||||||||
Short term borrowings |
||||||||||||||||||||
Accrued interest payable |
June 30, 2021 |
||||||||||||||||||||
(In thousands) |
Carrying Value |
Level 1 |
Fair Value Level 2 |
Level 3 |
Total |
|||||||||||||||
Assets: |
||||||||||||||||||||
Cash and cash equivalents |
$ | $ | $ | $ | $ | |||||||||||||||
Certificates of deposits |
||||||||||||||||||||
Securities available for sale |
||||||||||||||||||||
Securities held to maturity |
||||||||||||||||||||
Federal Home Loan Bank of Boston stock |
||||||||||||||||||||
Loans—net |
||||||||||||||||||||
Accrued interest receivable |
||||||||||||||||||||
Liabilities: |
— | |||||||||||||||||||
Deposits |
||||||||||||||||||||
Short term borrowings |
||||||||||||||||||||
Accrued interest payable |
• | statements of our goals, intentions and expectations; |
• | statements regarding our business plans, prospects, growth and operating strategies; |
• | statements regarding the quality of our loan and investment portfolios; and |
• | estimates of our risks and future costs and benefits. |
• | conditions relating to the COVID-19 pandemic, including the severity and duration of the associated economic slowdown either nationally or in our market areas, that are worse than expected; |
• | general economic conditions, either nationally or in our market areas, that are worse than expected; |
• | changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; |
• | our ability to access cost-effective funding; |
• | fluctuations in real estate values and both residential and commercial real estate market conditions; |
• | demand for loans and deposits in our market area; |
• | our ability to implement and change our business strategy; |
• | competition among depository and other financial institutions; |
• | inflation and changes in the interest rate environment that reduce our margins and yields, the fair value of financial instruments or our level of loan originations, or increase the level of defaults, losses and prepayments on loans we have made and make; |
• | adverse changes in the securities or secondary mortgage markets; |
• | changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees, capital requirements and insurance premiums; |
• | changes in the quality or composition of our loan or investment portfolios; |
• | technological changes that may be more difficult or expensive than expected; |
• | the inability of third-party providers to perform as expected; |
• | a failure or breach of our operational or security systems or infrastructure, including cyberattacks; |
• | our ability to manage market risk, credit risk and operational risk; |
• | our ability to enter new markets successfully and capitalize on growth opportunities; |
• | our ability to successfully integrate into our operations any assets, liabilities, customers, systems and management personnel we may acquire and our ability to realize related revenue synergies and cost savings within expected time frames, and any goodwill charges related thereto; |
• | changes in consumer spending, borrowing and savings habits; |
• | changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board; |
• | our ability to retain key employees; |
• | our compensation expense associated with equity allocated or awarded to our employees; and |
• | changes in the financial condition, results of operations or future prospects of issuers of securities that we own. |
Three Months Ended September 30, |
Change |
|||||||||||||||
(Dollars in thousands) |
2021 |
2020 |
Amount |
Percent |
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Customer service fees |
$ | 30 | $ | 27 | $ | 3 | 11.1 | % | ||||||||
Income on bank-owned life insurance |
74 | 72 | 2 | 2.8 | % | |||||||||||
Gain on security available for sale |
48 | — | 48 | - | % | |||||||||||
Other income |
104 | 97 | 7 | 7.2 | % | |||||||||||
|
|
|
|
|
|
|||||||||||
Total non-interest income |
$ | 256 | $ | 196 | $ | 60 | 30.6 | % | ||||||||
|
|
|
|
|
|
Three Months Ended September 30, |
Change |
|||||||||||||||
(Dollars in thousands) |
2021 |
2020 |
Amount |
Percent |
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Salaries and employee benefits |
$ | 997 | $ | 919 | $ | 78 | 8.5 | % | ||||||||
Occupancy and equipment |
210 | 192 | 18 | 9.4 | % | |||||||||||
Advertising |
41 | 25 | 16 | 64.0 | % | |||||||||||
Data processing |
80 | 84 | (4 | ) | (4.8 | %) | ||||||||||
Deposit insurance |
22 | 21 | 1 | 4.8 | % | |||||||||||
Other |
302 | 266 | 36 | 13.5 | % | |||||||||||
|
|
|
|
|
|
|||||||||||
Total non-interest expense |
$ | 1,652 | $ | 1,507 | $ | 145 | 9.6 | % | ||||||||
|
|
|
|
|
|
Three Months Ended September 30, |
||||||||||||||||||||||||
2021 |
2020 |
|||||||||||||||||||||||
(Dollars in thousands) |
Average Outstanding Balance |
Interest |
Average Yield/Rate |
Average Outstanding Balance |
Interest |
Average Yield/Rate |
||||||||||||||||||
Interest-earning assets: |
||||||||||||||||||||||||
Loans |
$ | 174,897 | $ | 1,654 | 3.78 | % | $ | 186,846 | $ | 1,851 | 3.96 | % | ||||||||||||
Securities |
106,276 | 588 | 2.21 | % | 93,938 | 582 | 2.48 | % | ||||||||||||||||
Other |
41,478 | 19 | 0.18 | % | 37,330 | 18 | 0.19 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total interest-earning assets |
322,651 | 2,261 | 2.80 | % | 318,114 | 2,451 | 3.08 | % | ||||||||||||||||
Non-interest-earning assets |
13,895 | 13,009 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Total assets |
$ | 336,546 | $ | 331,123 | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Interest-bearing liabilities: |
||||||||||||||||||||||||
Interest-bearing demand deposits |
$ | 30,669 | $ | 4 | 0.05 | % | $ | 26,800 | $ | 3 | 0.05 | % | ||||||||||||
Saving deposits |
71,102 | 18 | 0.10 | % | 62,768 | 16 | 0.10 | % | ||||||||||||||||
Money market deposits |
41,120 | 27 | 0.26 | % | 31,288 | 30 | 0.38 | % | ||||||||||||||||
Certificates of deposit |
110,613 | 225 | 0.81 | % | 131,260 | 619 | 1.89 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total interest-bearing deposits |
253,504 | 274 | 0.43 | % | 252,116 | 668 | 1.06 | % | ||||||||||||||||
FHLB advances |
567 | 4 | 2.74 | % | 3,057 | 22 | 2.84 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total interest-bearing liabilities |
254,071 | 278 | 0.44 | % | 255,173 | 690 | 1.08 | % | ||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Non-interest-bearing demand deposits |
30,237 | 25,544 | ||||||||||||||||||||||
Other non-interest-bearing liabilities |
3,332 | 3,090 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Total liabilities |
287,640 | 283,807 | ||||||||||||||||||||||
Retained earnings |
48,906 | 47,316 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Total liabilities and equity |
$ | 336,546 | $ | 331,123 | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Net interest income |
$ | 1,983 | $ | 1,761 | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Net interest rate spread (1) |
2.37 | % | 2.00 | % | ||||||||||||||||||||
Net interest-bearing assets (2) |
$ | 68,580 | $ | 62,941 | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Net interest margin (3) |
2.46 | % | 2.21 | % | ||||||||||||||||||||
Average interest-bearing assets to interest-bearing liabilities |
126.99 | % | 124.67 | % |
(1) | Net interest rate spread represents the difference between the weighted average yield earned on interest-earning assets and the weighted average rate paid on interest-bearing liabilities. |
(2) | Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. |
(3) | Net interest margin represents net interest income divided by average total interest-earning assets. |
Three Months Ended September 30, 2021 vs 2020 |
||||||||||||
(In thousands) |
Increase (Decrease) Due to Volume |
Increase (Decrease) Due to Rate |
Total Increase (Decrease) |
|||||||||
Interest-earning assets: |
||||||||||||
Loans |
$ | (118 | ) | $ | (79 | ) | $ | (197 | ) | |||
Securities |
76 | (70 | ) | 6 | ||||||||
Other |
2 | (1 | ) | 1 | ||||||||
|
|
|
|
|
|
|||||||
Total interest-earning assets |
(40 | ) | (150 | ) | (190 | ) | ||||||
|
|
|
|
|
|
|||||||
Interest bearing liabilities: |
||||||||||||
Interest-bearing demand deposits |
— | 1 | 1 | |||||||||
Savings deposits |
2 | — | 2 | |||||||||
Money market deposits |
9 | (12 | ) | (3 | ) | |||||||
Certificates of deposit |
(97 | ) | (297 | ) | (394 | ) | ||||||
|
|
|
|
|
|
|||||||
Total deposits |
(86 | ) | (308 | ) | (394 | ) | ||||||
FHLB advances |
(18 | ) | — | (18 | ) | |||||||
|
|
|
|
|
|
|||||||
Total interest-bearing liabilities |
(104 | ) | (308 | ) | (412 | ) | ||||||
|
|
|
|
|
|
|||||||
Change in net interest income |
$ | 64 | $ | 158 | $ | 222 | ||||||
|
|
|
|
|
|
• | emphasize the marketing of our non-interest-bearing |
• | invest in short- to medium-term repricing and/or maturing securities whenever the market allows; and |
• | maintain a strong capital position. |
Change in Interest Rates (basis points) (1) |
Net Interest Income Year 1 Forecast (In thousands) |
Year 1 Change from Level |
||||||
+400 |
$ | 8,023 | 5.2 | % | ||||
+300 |
7,995 | 4.9 | % | |||||
+200 |
7,947 | 4.2 | % | |||||
+100 |
7,847 | 2.9 | % | |||||
Level |
7,625 | — | % | |||||
-100 |
6,996 | (8.3 | %) |
(1) | Assumes an immediate uniform change in interest rates at all maturities. |
At September 30, 2021 |
||||||||||||||||||||
Estimated Decrease in EVE |
EVE as a Percentage of Present Value of Assets (3) |
|||||||||||||||||||
Change in Interest Rates (basis points) (1) |
Estimated EVE (2) (In thousands) |
Amount (In thousands) |
Percent |
EVE Ratio (4) |
Decrease (basis points) |
|||||||||||||||
+400 |
$ | 39,555 | $ | (13,890 | ) | (26.0 | %) | 13.2 | % | (253 | ) | |||||||||
+300 |
43,221 | (10,224 | ) | (19.1 | %) | 13.9 | % | (176 | ) | |||||||||||
+200 |
47,030 | (6,415 | ) | (12.0 | %) | 14.7 | % | (101 | ) | |||||||||||
+100 |
50,774 | (2,671 | ) | (5.0 | %) | 15.4 | % | (34 | ) | |||||||||||
Level |
53,445 | — | — | % | 15.7 | % | — | |||||||||||||
-100 |
51,977 | (1,468 | ) | (2.7 | %) | 15.0 | % | (69 | ) |
(1) | Assumes an immediate uniform change in interest rates at all maturities. |
(2) | EVE is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts. |
(3) | Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets. |
(4) | EVE Ratio represents EVE divided by the present value of assets. |
* | Furnished, not filed. |
CFSB BANCORP, INC. | ||||
Date: December 22, 2021 |
By: |
/s/ Michael E. McFarland | ||
Michael E. McFarland | ||||
President and Chief Executive Officer | ||||
(Principal Executive Officer) | ||||
Date: December 22, 2021 |
By: |
/s/ Susan Shea | ||
Susan Shea | ||||
Treasurer and Chief Operating Officer | ||||
(Principal Financial and Accounting Officer) |