KS Bancorp, Inc. (KSBI) Announces Third Quarter 2022 Financial Results and Cash Dividend
October 20, 2022 at 01:30 am IST
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SMITHFIELD, N.C., Oct. 19, 2022 (GLOBE NEWSWIRE) -- KS Bancorp, Inc. (the “Company”) (OTCBB: KSBI), parent company of KS Bank, Inc. (the “Bank”), announced unaudited results for the third quarter of 2022.
The Company reported net income of $2.1 million or $1.86 per diluted share, for the three months ended September 30, 2022, an increase of 22.4% compared to net income of $1.7 million or $1.52 per diluted share, for the three months ended September 30, 2021.
Net interest income before the provision for loan losses for the three months ended September 30, 2022 was $5.5 million compared to $4.7 million at September 30, 2021. Noninterest income for the three months ended September 30, 2022 was $740,000, compared to $758,000 for the comparable period ended September 30, 2021. Noninterest expense was $3.6 million for the three months ended September 30, 2022, compared to $3.2 million in the comparable period in 2021. The Company did not record any provision for loan losses during the third quarter 2022, compared to $123,000 in the third quarter of 2021.
For the nine months ended September 30, 2022, net interest income before the provision for loan losses was $14.5 million, compared to $13.3 million for the nine months ended September 30, 2021. Noninterest income was $2.3 million for the nine month period ending September 30, 2022 compared to $2.1 million for the same period ended September 30, 2021. For the nine months ended September 30, 2022, non-interest expenses was $10.2 million, compared to $9.2 million for the same period ending September 30, 2021.
The Company’s unaudited consolidated total assets decreased $9.0 million, to $562.2 million at September 30, 2022, compared to $571.2 million at December 31, 2021. Net loan balances increased by $48.1 million, to $393.7 million at September 30, 2022, compared to $345.6 million at December 31, 2021. The Company’s investment securities totaled $99.1 million at September 30, 2022, compared to $88.3 million at December 31, 2021. Total deposits increased $28.4 million to $515.8 million at September 30, 2022, compared to $487.4 million at December 31, 2021. For the nine months ended September 30, 2022, there was a $32.6 million increase in core deposits and a $3.9 million decrease in brokered funding. Long-term borrowings decreased $31 million to $11 million at September 30, 2022 compared to $42 million at December 31, 2021. This decrease is attributable to the repayment of $32 million in Federal Home Loan Bank borrowings. Total stockholders’ equity decreased $6.3 million to $30.3 million at September 30, 2022, from $36.6 million at December 31, 2021. The decrease in stockholders equity is primarily attributable to the change in accumulated other comprehensive income of $11.0 million in the third quarter of 2022, which is partially offset by an increase in retained earnings of $4.7 million.
Nonperforming assets consisted of $992,000 nonaccrual loans at September 30, 2022, representing less than 0.20% of the Company’s total assets. There was no foreclosed real estate owned at September 30, 2022. The allowance for loan losses at September 30, 2022 totaled $5.1 million, or 1.27% of total loans.
Commenting on the third quarter results, Harold Keen, President and CEO of the Company, stated, “During the recent months of rising interest rates KS Bank has been successfully increasing outstanding loans. The continued growth in net income during the third quarter is a direct result of those efforts. It has been a very good year to be a community bank.”
In addition, the Company announced today that its Board of Directors has declared a quarterly dividend of $0.20 per share for stockholders of record as of October 28, 2022 with payment to be made on November 7, 2022.
KS Bank continues to be well capitalized according to regulatory standards with total risk-based capital of 13.31%, tier 1 risk-based capital of 12.12%, common equity tier 1 risk-based capital of 12.12%, and a tier 1 leverage ratio of 9.15% at September 30, 2022. The minimum levels to be considered well capitalized for each of these ratios are 10.0%, 8.0%, 6.5%, and 5.0%, respectively.
KS Bancorp, Inc. is a Smithfield, North Carolina-based single bank holding company. KS Bank, Inc., a state-chartered savings bank, is KS Bancorp’s sole subsidiary. The Bank is a full service community bank serving the citizens of eastern North Carolina since 1924. The Bank offers a broad range of personal and business banking products and services, mortgage products and trust services. There are nine full service branches located in Kenly, Selma, Clayton, Garner, Goldsboro, Wilson, Wendell, Smithfield, and Four Oaks, North Carolina. There is a loan production office in Dunn, NC which opened in April, 2022. For more information, visit www.ksbankinc.com.
This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate” and “believe,” variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. The Company undertakes no obligation to update any forward-looking statements.
KS Bancorp, Inc. and Subsidiary
Consolidated Statements of Financial Condition
September 30, 2022
December 31,
(unaudited)
2021*
(Dollars in thousands)
ASSETS
Cash and due from banks:
Interest-earning
$
40,849
$
111,762
Noninterest-earning
3,204
2,626
Time Deposit
5,100
5,100
Investment securities available for sale, at fair value
99,055
88,320
Federal Home Loan Bank stock, at cost
299
1,443
Loans
398,786
350,667
Less allowance for loan losses
(5,071
)
(5,023
)
Net loans
393,715
345,644
Accrued interest receivable
1,715
1,543
Foreclosed assets, net
-
621
Property and equipment, net
9,362
8,928
Other assets
8,924
5,238
Total assets
$
562,223
$
571,225
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits
$
515,809
$
487,437
Short-term borrowings
$
-
$
1,000
Long-term borrowings
11,248
42,248
Accrued interest payable
53
216
Accrued expenses and other liabilities
4,846
3,679
Total liabilities
531,956
534,580
Stockholder's Equity:
Preferred stock, no par value, 500,000 shares authorized; none issued and outstanding
Common stock, no par value, 3,500,000 shares authorized; 1,107,776 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively
1,359
1,359
Retained earnings, substantially restricted
39,342
34,694
Accumulated other comprehensive income (loss)
(10,434
)
592
Total stockholders' equity
30,267
36,645
Total liabilities and stockholders' equity
$
562,223
$
571,225
* Derived from audited financial statements
KS Bancorp, Inc and Subsidiary
Consolidated Statements of Income (Unaudited)
Three Months Ended
Nine Months Ended
Sept 30,
Sept 30,
2022
2021
2022
2021
(In thousands, except per share data)
Interest and dividend income:
Loans
$
4,864
$
4,744
$
13,321
$
13,691
Investment securities
Taxable
466
272
1,233
786
Tax-exempt
205
155
567
393
Dividends
3
10
8
49
Interest-bearing deposits
301
27
478
48
Total interest and dividend income
5,839
5,208
$
15,607
14,967
Interest expense:
Deposits
223
249
653
799
Borrowings
120
276
444
871
Total interest expense
343
525
1,097
1,670
Net interest income
5,496
4,683
14,510
13,297
Provision for loan losses
-
123
-
369
Net interest income after
provision for loan losses
5,496
4,560
14,510
12,928
Noninterest income:
Service charges on deposit accounts
328
281
936
843
Fees from presold mortgages
5
5
17
54
Other income
407
472
1,311
1,244
Total noninterest income
740
758
2,264
2,141
Noninterest expenses:
Compensation and benefits
2,242
1,935
6,351
5,634
Occupancy and equipment
546
394
1,575
1,122
Data processing & outside service fees
210
241
618
702
Advertising
38
22
88
48
Foreclosed real estate and repossessions, net
-
-
(230
)
-
Other
588
592
1,767
1,644
Total noninterest expenses
3,624
3,184
10,169
9,150
Income before income taxes
2,612
2,134
6,605
5,919
Income tax
550
449
1,381
1,256
Net income
$
2,062
$
1,685
$
5,224
$
4,663
Basic and Diluted earnings per share
$
1.86
$
1.52
$
4.71
$
4.21
Contact: Harold T. Keen
President and Chief Executive Officer
(919) 938-3101
Regina J Smith
Chief Financial Officer
(919) 938-3101
KS Bancorp, Inc. is a bank holding company. The Company offers a range of personal and business banking products and services, mortgage products and trust services. The Company operates through its subsidiary, KS Bank, Inc. (the Bank), which conducts its operations through nine full-service branch offices in Kenly, Goldsboro, Wilson, Garner, Selma, Clayton, Wendell, Four Oaks and Smithfield, North Carolina, as well as a loan production office in Dunn. KS Personal Services offers a complete suite of deposit and loan products that are tailored to specific needs, while KS Business Services includes deposit and loan products, payroll services (through Flex Pay), merchant card services, cash management and remote deposit. KS Mortgage Services offers mortgage products through a team of mortgage specialists. Its Trust Services Division offers a complete line of trust services, such as money management, individual retirement accounts (IRAs), trust administration and estate administration.