MOORESVILLE, N.C., April 20, 2023 /PRNewswire/ — blueharbor bank (the “Bank”) today reported net income of $2,092,487 and $0.69 per diluted share for the first quarter of 2023, an increase of 65%, or $825,754, as compared to $1,266,733 and $0.42 per diluted share for the first quarter of 2022.
The Bank reported total assets of $415.6 million at March 31, 2023, an increase of $9.2 million, or 2%, when compared to $406.4 million at December 31, 2022. Gross loans increased $3.6 million, to $339.1 million at March 31, 2023, from $335.5 million at December 31, 2022. Total deposits were $365.1 million at March 31, 2023, an increase of $5.6 million, or 2%, when compared to $359.5 million at December 31, 2022. The growth in deposits consisted mainly of core deposits which increased $5.3 million, or 2%, to $348.9 million at March 31, 2023, compared to $343.6 million at December 31, 2022.
Asset quality remained very strong for the first quarter of 2023, with total non-performing assets representing only 0.02% of total assets at March 31, 2023, and March 31, 2022.
Capital levels also remained solid with total risk-based capital at 14.7%, both common equity tier 1 and tier 1 to risk-weighted assets of 13.8%, and tier 1 leverage ratio of 11.8% for the quarter ended March 31, 2023.
Annualized return on average assets (ROA) was 2.08% for the quarter ended March 31, 2023, an increase of 90 basis points over the ROA of 1.18% that was reported for the quarter ended March 31, 2022. When excluding income tax of $601,799 for the first quarter of 2023 and $362,288 for the first quarter of 2022, pre-tax ROA was 2.68% and 1.52%, respectively. Annualized return on equity (ROE) was 19.40% for the quarter ended March 31, 2023, an increase of 667 basis points over the ROE of 12.73% that was reported for the quarter ended March 31, 2022. When excluding income tax, ROE was 24.99% and 16.37% for the quarters ended March 31, 2023 and March 31, 2022, respectively.
Net interest income was $4,088,256 for the quarter ending March 31, 2023, an increase of $1,132,934, or 38%, from the same period in 2022. The increase in net interest income was due primarily to the increase in the yields on interest earning assets.
The Bank adopted the CECL accounting standard effective January 1, 2023. As a result of the adoption there was a slight increase in the Allowance for Credit Losses (ACL). A reserve for unfunded credit commitments was also created in the initial amount of $280,436. There was a decrease to retained earnings of $219,165, net of tax, associated with CECL adoption.
The bank recorded a quarterly provision for credit losses of $40,945 for the first quarter of 2023, compared to a quarterly provision for credit losses of $151,234 for the same period in 2022. The decrease in provision was due to lower loan growth in first quarter 2023 than in the first quarter of 2022. The allowance for loan losses to total loans was 0.96% at March 31, 2023.
Noninterest income was $701,488 for the quarter ended March 31, 2023, a slight increase over the $690,896 that was recorded for the quarter ended March 31, 2022.
Noninterest expense was $2,054,513 for the quarter ended March 31, 2023, compared to $1,865,963 for the quarter ended March 31, 2022. The increase of $188,550 was due to higher occupancy and furniture and equipment expenses for the new Statesville branch completed in September of 2022. Data processing expenses also increased during the period due to a greater number of customers and accounts. Although noninterest expense increased, the Bank’s efficiency ratio (which is calculated by dividing noninterest expense by the sum of net interest income and noninterest income) decreased from 51.2% at March 31, 2022 down to 42.9% at March 31, 2023 as the Bank continues to focus on controlling expenses.
Jim Marshall, President and Chief Executive Officer, commented, “We continue to be pleased with our performance and our first quarter 2023 results are no exception. Balance sheet growth was acceptable given the cumulative effect rising interest rates are having on the economy. Our credit portfolio continues to perform very nicely given those headwinds.
“Deposits have remained steady for us given the turbulence recently that now seems to be settling. The majority of our deposits are insured and represent solid relationships.
“And we continue to receive nice recognition for our performance, this time from S&P Global Market Intelligence. As of December 31, 2022, we ranked 6th in the Southeastern United States among banks with less than $10 billion in assets. That group included 732 banks among 9 states. Rankings were based on profitability, efficiency, growth, credit quality, and capital ratios.”
blueharbor bank is headquartered in Mooresville with a branch in Statesville and loan production offices in Belmont and Morehead City. blueharbor bank’s website is www.blueharborbank.com and our common stock is quoted on the OTCQX Market under the symbol “BLHK.”
Summary Selected Financial Data Schedule attached below.
Forward-Looking Statement:
This press release contains forward-looking statements. Words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “should,” “will,” variations of such words and similar expressions are intended to identify forward-looking statements. These statements reflect management’s current beliefs as to the expected outcomes of future events and are not guarantees of future performance. These statements involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. As such, actual results and outcomes may materially differ from what may be expressed or forecast in such forward-looking statements. Factors that could cause a difference include, among others: changes in the national and local economies or market conditions; changes in interest rates, deposit levels, loan demand and asset quality, including real estate and other collateral values; changes in banking regulations and accounting principles, policies or guidelines; and the impact of competition from traditional or new sources. These and other factors that may emerge could cause decisions and actual results to differ materially from current expectations. blueharbor bank takes no obligation to revise, update, or clarify forward-looking statements to reflect events or conditions after the date of this press release.
Non-GAAP Financial Measures:
This press release contains certain financial measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Such non-GAAP financial measures include pre-tax annualized return on assets (ROA), pre-tax annualized return on equity (ROE) and efficiency ratio. Management uses these non-GAAP financial measures to assess the performance of blueharbor bank’s core business. Management believes that these non-GAAP financial measures provide meaningful additional information about blueharbor bank to assist investors in evaluating operating results. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant charges for credit costs and other factors. These non-GAAP financial measures should not be considered as a substitute for operating results determined in accordance with GAAP and may not be comparable to other similarly titled measures of other companies.
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Summary Selected Financial Data |
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(Unaudited) |
(Audited) |
(Unaudited) |
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March 31, |
December 31, |
March 31, |
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Balance Sheet Data: |
2023 |
2022 |
2022 |
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|
Total Assets |
$ 415,594,195 |
$ 406,356,659 |
$ 443,421,760 |
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|
Total Gross Loans |
339,058,274 |
335,496,493 |
301,398,721 |
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|
Allowance for Loan Losses |
3,229,013 |
3,171,448 |
3,013,987 |
||
|
Total Deposits |
365,112,143 |
359,486,348 |
399,429,779 |
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|
Total Shareholders’ Equity |
45,255,721 |
42,490,336 |
39,526,454 |
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|
(Unaudited) |
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Three Months Ended |
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March 31, |
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Earnings and Per Share Data: |
2023 |
2022 |
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|
Interest Income |
$ 4,596,887 |
$ 3,092,699 |
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Interest Expense |
508,631 |
137,377 |
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Net Interest Income |
4,088,256 |
2,955,322 |
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Provision for Loan Losses |
40,945 |
151,234 |
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|
Net Interest Income after |
|||||
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Provision for Loan Losses |
4,047,311 |
2,804,088 |
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Noninterest Income |
701,488 |
690,896 |
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Noninterest Expense |
2,054,513 |
1,865,963 |
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Net Income before Taxes |
2,694,286 |
1,629,021 |
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Income Taxes |
601,799 |
362,288 |
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Net Income |
$ 2,092,487 |
$ 1,266,733 |
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Basic Income per Share |
$ 0.72 |
$ 0.43 |
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Diluted Income per Share |
$ 0.69 |
$ 0.42 |
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Annualized Performance Ratios: |
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Return on average assets |
2.08 % |
1.18 % |
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Return on average equity |
19.40 % |
12.73 % |
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Efficiency ratio |
42.9 % |
51.2 % |
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Overhead ratio |
33.1 % |
39.8 % |
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|
Net Interest Margin |
4.35 % |
2.94 % |
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|
Cost of Funds |
0.90 % |
0.21 % |
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|
(Unaudited) |
(Unaudited) |
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March 31, |
March 31, |
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|
2023 |
2022 |
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Financial Ratios: |
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Book Value |
$ 15.30 |
$ 13.41 |
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Nonperforming Assets to Total Assets Ratio |
0.02 % |
0.02 % |
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Loan to Deposit Ratio |
92.9 % |
93.3 % |
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Tier 1 Leverage Ratio |
11.8 % |
9.5 % |
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Common Equity Tier 1 Risk-Based Capital Ratio |
13.8 % |
12.5 % |
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|
Tier 1 Risk-Based Capital Ratio |
13.8 % |
12.5 % |
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Total Risk-Based Capital Ratio |
14.7 % |
13.4 % |
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SOURCE blueharbor bank
