MCMINNVILLE, Tenn., Aug. 04, 2022 (GLOBE NEWSWIRE) — Security Bancorp, Inc. (“Company”) (OTCBB: “SCYT”), the holding company for Security Federal Savings Bank of McMinnville, Tennessee, today announced its consolidated earnings for the second quarter of its fiscal year ended December 31, 2022.
Net income for the three months ended June 30, 2022 was $744,000, or $2.03 per share, compared to $627,000, or $1.72 per share, for the same quarter last year. For the six months ended June 30, 2022, the Company’s net income was $1.3 million or $3.58 per share, relatively unchanged from $1.3 million, or $3.56 per share, for the same period in 2021.
For the three months ended June 30, 2022, net interest income increased $324,000, or 17.8%, to $2.1 million from $1.8 million for the same period in 2021. For the six months ended June 30, 2022, net interest income increased $459,000, or 12.6%, to $4.1 million from $3.6 million for the six months ended June 30, 2021. The increase in net interest income for the three months and six months ended June 30, 2022 was primarily the result of an increase in loan balances, an increase in loan interest rates offset also by a decrease in interest expense. Net interest income after provision for loan losses for the three months ended June 30, 2022 was $2.1 million, an increase of $354,000, or 20.2%, from the same period in the previous year. For the six months ended June 30, 2022, net interest income after provision for loan losses increased $518,000, or 14.8%, to $4.0 million from $3.5 million for the same period in 2021. The primary reason for the increase during the three months and six months ended June 30, 2022 was an increase in net interest income as well as a decrease in the provision for loan losses.
Non-interest income for the three months ended June 30, 2022 was $500,000 compared to $608,000 for the same quarter of 2021, a decrease of $108,000. Non-interest income for the six months ended June 30, 2022 was $892,000 compared to $1.3 million for the same period the prior year, a decrease of $403,000. The decrease during the three and six months ended June 30, 2022 was primarily attributable to a decrease in the gains on the sale of loans due to a decrease in the volume of mortgage activities as a result of the rise in interest rate on mortgage loans.
Non-interest expense for the three months ended June 30, 2022 was $1.6 million, an increase of $88,000, or 5.8% from $1.5 million for the same period the prior year. For the six months ended June 30, 2022, non-interest expense was $3.2 million, an increase of $105,000, or 3.4%, compared to the same period in 2021.
Consolidated assets of the Company were $298.2 million at June 30, 2022, compared to $295.7 million at December 31, 2021. The $2.4 million, or 0.8%, increase in assets was a result of an increase in loans receivable offset by a decrease in cash and interest-bearing deposits with banks. Loans receivable, net, increased $12.0 million, or 6.7%, to $193.4 million at June 30, 2022 from $181.2 million at December 31, 2021. The increase in loans receivable was attributable to an increase in commercial real estate loans.
For the three months ended June 30, 2022 the provision for loan losses was $30,000 compared to $60,000 for the same period in 2021. The provision for loan losses was $61,000 for the six months ended June 30, 2022 compared to $120,000 in the comparable period in 2021, a decrease of $59,000.
Non-performing assets decreased $13,000, or 4.3%, to $288,000 at June 30, 2022 from $301,000 at December 31, 2021. The decrease is attributable to a decrease in non-performing loans. Based on its analysis of delinquent loans, non-performing loans and classified loans, management believes that the Company’s allowance for loan losses of $2.1 million at June 30, 2022 was adequate to absorb known and inherent risks in the loan portfolio at that date. At June 30, 2022, the allowance for loan losses to non-performing assets was 730.56% compared to 677.41% at December 31, 2021.
Investment and mortgage-backed securities available-for-sale at June 30, 2022 decreased $783,000, or 1.3%, to $58.0 million from $58.8 million at December 31, 2021. The decrease was due to investment maturities and paydowns. There were no investment and mortgage-backed securities held-to-maturity at June 30, 2022 and December 31, 2021.
Deposits increased $3.4 million, or 1.3%, to $268.6 million at June 30, 2022 from $265.2 million at December 31, 2021. The increase was primarily attributable to increases in consumer and commercial checking account balances, savings account balances and certificates of deposit.
Stockholders’ equity decreased $1.1 million or 3.9% to $27.0 million, or 9.0% of total assets at June 30, 2022 compared to $28.0 million, or 9.5%, of total assets, at December 31, 2021. The decrease in stockholders’ equity is due to the increase in unrealized losses on securities available-for-sale primarily as a result of increases in market interest rates.
Safe-Harbor Statement
Certain matters in this News Release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may relate to, among others, expectations of the business environment in which the Company operates and projections of future performance. These forward-looking statements are based upon current management expectations, and may, therefore, involve risks and uncertainties. The Company’s actual results, performance, or achievements may differ materially from those suggested, expressed, or implied by forward-looking statements as a result of a wide range of factors including, but not limited to, the general business environment, interest rates, competitive conditions, regulatory changes, and other risks.
| Contact: | Joe Pugh |
| President & Chief Executive Officer | |
| (931) 473-4483 |
| SECURITY BANCORP, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited) (dollars in thousands) |
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| OPERATING DATA | Three months ended June 30, |
Six months ended June 30, |
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| 2021 | 2022 | 2021 | 2022 | |||||||
| Interest income | $2,112 | $2,340 | $4,219 | $4,476 | ||||||
| Interest expense | 292 | 196 | 590 | 388 | ||||||
| Net interest income | 1,820 | 2,144 | 3,629 | 4,088 | ||||||
| Provision for loan losses | 60 | 30 | 120 | 61 | ||||||
| Net interest income after provision for loan losses | 1,760 | 2,114 | 3,509 | 4,027 | ||||||
| Non-interest income | 608 | 500 | 1,295 | 892 | ||||||
| Non-interest expense | 1,524 | 1,612 | 3,062 | 3,167 | ||||||
| Income before income tax expense | 844 | 1,002 | 1,742 | 1,752 | ||||||
| Income tax expense | 217 | 258 | 443 | 440 | ||||||
| Net income | $627 | $744 | $1,299 | $1,312 | ||||||
| Net Income per share (basic) | $1.72 | $2.03 | $3.56 | $3.58 | ||||||
| FINANCIAL CONDITION DATA | At June 30, 2022 | At December 31, 2021 | ||||||||
| Total assets | $298,192 | $295,745 | ||||||||
| Investments and mortgage backed securities – available for sale | 58,033 | 58,816 | ||||||||
| Loans receivable, net | 193,359 | 181,242 | ||||||||
| Deposits | 268,571 | 265,189 | ||||||||
| Repurchase agreements | -0- | -0- | ||||||||
| Federal Home Loan Bank Advances | -0- | -0- | ||||||||
| Stockholders’ equity | 26,955 | 28,042 | ||||||||
| Non-performing assets | 288 | 301 | ||||||||
| Non-performing assets to total assets | 0.10% | 0.11% | ||||||||
| Allowance for loan losses | $2,104 | 2,039 | ||||||||
| Allowance for loan losses to total loans receivable | 1.08% | 1.11% | ||||||||
| Allowance for loan losses to non-performing assets | 730.56% | 677.41% | ||||||||
