- Quarterly EPS of
$0.70 - Quarterly Return on Average Assets of 1.22%
- Quarterly Net Interest Margin of 3.48%
- Net Loans Increased by 12% Year-Over-Year
- Deposits Increased by 6% Year-Over-Year
- Announces Quarterly Cash Dividend
For the first six months of fiscal 2024, Timberland’s net income decreased 15% to
“Our second quarter of fiscal year 2024 operating results were highlighted by solid earnings, moderate growth in loans and deposits, and continued stable asset quality metrics,” stated
As a result of Timberland’s solid earnings and strong capital position, its Board of Directors announced a quarterly cash dividend to shareholders to
“Our loan portfolio continues to grow, but not at the robust pace we’ve experienced during the past two years,” Brydon continued. “Construction loan balances declined during the quarter, in part due to construction projects completing and being transferred to permanent loan categories. Although loan origination volumes slowed during the quarter, net loans receivable increased by
“The net interest margin was 3.48% for the second quarter, a 12 basis points contraction compared to the preceding quarter as the increase in cost of funds continued to outpace the growth in yields on interest-earning assets,” said
Earnings and Balance Sheet Highlights (at or for the periods ended
Earnings Highlights:
- Earnings per diluted common share (“EPS”) decreased 9% to
$0.70 for the current quarter from$0.77 for the preceding quarter and decreased 13% from$0.80 for the comparable quarter one year ago; EPS for the first six months of fiscal 2024 decreased 14% to$1.47 from$1.70 for the first six months of fiscal 2023; - Net income decreased 9% to
$5.71 million for the current quarter from$6.30 million for the preceding quarter and decreased 14% from$6.66 million for the comparable quarter one year ago; Net income decreased 15% to$12.00 million for the first six months of fiscal 2024 compared to$14.17 million for the first six months of fiscal 2023; - Return on average equity (“ROE”) and return on average assets (“ROA”) for the current quarter were 9.67% and 1.22%, respectively;
- Net interest margin (“NIM”) for the current quarter compressed to 3.48% from 3.60% for the preceding quarter and from 3.99% for the comparable quarter one year ago; and
- The efficiency ratio for the current quarter was 60.22% compared to 56.50% for the preceding quarter and 55.31% for the comparable quarter one year ago.
Balance Sheet Highlights:
- Total assets increased 1% from the prior quarter and increased 7% year-over-year;
- Net loans receivable increased 2% from the prior quarter and increased 12% year-over-year;
- Total deposits increased 1% from the prior quarter and increased 6% year-over-year;
- Total shareholders’ equity increased 1% from the prior quarter and increased 5% year-over-year;
- Non-performing assets to total assets ratio was 0.19% at
March 31, 2024 compared to 0.18% atDecember 31, 2023 and 0.12% atMarch 31, 2023 ; - Book and tangible book (non-GAAP) values per common share increased to
$29.75 and$27.79 , respectively, atMarch 31, 2024 ; and - Liquidity (both on-balance sheet and off-balance sheet) remained strong at
March 31, 2024 with only$20 million in borrowings and additional secured borrowing line capacity of$707 million available through theFederal Home Loan Bank (“FHLB”) and theFederal Reserve .
Operating Results
Operating revenue (net interest income before the provision for credit losses plus non-interest income) for the current quarter decreased 3% to
Net interest income decreased
A
Non-interest income decreased
Total operating (non-interest) expenses for the current quarter increased
The provision for income taxes for the current quarter decreased
Balance Sheet Management
Total assets increased
Liquidity
Timberland has maintained a strong liquidity position (both on-balance sheet and off-balance sheet) while continuing to grow the loan portfolio. Liquidity, as measured by the sum of cash and cash equivalents, CDs held for investment, and available for sale investment securities, was 15.2% of total liabilities at
Loans
Net loans receivable increased
Loan Portfolio ($ in thousands) | |||||||||||||||||||||||||
Amount | Percent | Amount | Percent | Amount | Percent | ||||||||||||||||||||
Mortgage loans: | |||||||||||||||||||||||||
One- to four-family (a) | $ | 276,433 | 19 | % | $ | 263,122 | 18 | % | $ | 216,639 | 16 | % | |||||||||||||
Multi-family | 167,275 | 12 | 147,321 | 10 | 103,870 | 8 | |||||||||||||||||||
Commercial | 577,373 | 40 | 579,038 | 40 | 547,876 | 41 | |||||||||||||||||||
Construction - custom and owner/builder | 122,988 | 8 | 134,878 | 9 | 124,071 | 9 | |||||||||||||||||||
Construction - speculative one-to four-family | 16,407 | 1 | 17,609 | 1 | 11,343 | 1 | |||||||||||||||||||
Construction - commercial | 32,318 | 2 | 36,702 | 3 | 31,458 | 3 | |||||||||||||||||||
Construction - multi-family | 36,795 | 3 | 57,019 | 4 | 83,051 | 6 | |||||||||||||||||||
Construction - land development | 16,051 | 1 | 18,878 | 1 | 17,018 | 1 | |||||||||||||||||||
Land | 31,821 | 2 | 28,697 | 2 | 24,520 | 2 | |||||||||||||||||||
Total mortgage loans | 1,277,461 | 88 | 1,283,264 | 88 | 1,159,846 | 87 | |||||||||||||||||||
Consumer loans: | |||||||||||||||||||||||||
Home equity and second mortgage | 42,357 | 3 | 39,403 | 3 | 36,896 | 3 | |||||||||||||||||||
Other | 2,925 | -- | 2,926 | -- | 2,283 | -- | |||||||||||||||||||
Total consumer loans | 45,282 | 3 | 42,329 | 3 | 39,179 | 3 | |||||||||||||||||||
Commercial loans: | |||||||||||||||||||||||||
Commercial business loans | 135,505 | 9 | 136,942 | 9 | 129,306 | 10 | |||||||||||||||||||
SBA PPP loans | 367 | -- | 423 | -- | 572 | -- | |||||||||||||||||||
Total commercial loans | 135,872 | 9 | 137,365 | 9 | 129,878 | 10 | |||||||||||||||||||
Total loans | 1,458,615 | 100 | % | 1,462,958 | 100 | % | 1,328,903 | 100 | % | ||||||||||||||||
Less: | |||||||||||||||||||||||||
Undisbursed portion of construction loans in process | (77,502 | ) | (104,683 | ) | (99,253 | ) | |||||||||||||||||||
Deferred loan origination fees | (5,179 | ) | (5,337 | ) | (4,759 | ) | |||||||||||||||||||
Allowance for credit losses | (16,818 | ) | (16,655 | ) | (14,698 | ) | |||||||||||||||||||
Total loans receivable, net | $ | 1,359,116 | $ | 1,336,283 | $ | 1,210,193 |
_______________________
(a) Does not include one- to four-family loans held for sale totaling
The following table provides a breakdown of commercial real estate (“CRE”) mortgage loans by collateral type as of
CRE Loan Portfolio Breakdown by Collateral ($ in thousands) | ||||||||||||||||||
Collateral Type | Balance | Percent of CRE Portfolio | Percent of Total Loan Portfolio | Average Balance Per Loan | Non- Accrual | |||||||||||||
Industrial warehouse | $ | 112,318 | 20 | % | 8 | % | $ | 1,123 | $ | 195 | ||||||||
Medical/dental offices | 81,335 | 14 | 6 | 1,291 | -- | |||||||||||||
Office buildings | 71,518 | 12 | 5 | 777 | -- | |||||||||||||
Other retail buildings | 51,422 | 9 | 3 | 547 | -- | |||||||||||||
Mini-storage | 39,228 | 7 | 3 | 1,453 | -- | |||||||||||||
Hotel/motel | 31,713 | 5 | 2 | 2,883 | -- | |||||||||||||
Restaurants | 27,583 | 5 | 2 | 563 | -- | |||||||||||||
Gas stations/conv. stores | 20,977 | 4 | 1 | 912 | -- | |||||||||||||
Nursing homes | 18,630 | 3 | 1 | 2,329 | -- | |||||||||||||
Mobile home parks | 10,869 | 2 | 1 | 494 | -- | |||||||||||||
Shopping centers | 10,854 | 2 | 1 | 1,809 | -- | |||||||||||||
Churches | 6,976 | 1 | 1 | 498 | -- | |||||||||||||
Additional CRE | 93,950 | 16 | 6 | 706 | 954 | |||||||||||||
Total CRE | $ | 577,373 | 100 | % | 40 | % | $ | 899 | $ | 1,149 |
Timberland originated
Timberland’s investment securities and CDs held for investment decreased
Deposits
Total deposits increased
Deposit Breakdown ($ in thousands) | |||||||||||||||||||
Amount | Percent | Amount | Percent | Amount | Percent | ||||||||||||||
Non-interest-bearing demand | 26 | % | 27 | % | 31 | % | |||||||||||||
NOW checking | 336,621 | 20 | 389,463 | 24 | 403,463 | 26 | |||||||||||||
Savings | 211,085 | 13 | 215,948 | 13 | 269,522 | 17 | |||||||||||||
Money market | 311,994 | 19 | 269,686 | 17 | 210,390 | 14 | |||||||||||||
Certificates of deposit under | 190,762 | 12 | 181,762 | 11 | 129,331 | 8 | |||||||||||||
Certificates of deposit | 118,698 | 7 | 96,145 | 6 | 56,778 | 4 | |||||||||||||
Certificates of deposit – brokered | 44,488 | 3 | 41,000 | 2 | -- | -- | |||||||||||||
Total deposits | 100 | % | 100 | % | 100 | % |
Borrowings
Total borrowings were
Shareholders’ Equity and Capital Ratios
Total shareholders’ equity increased
Timberland remains well capitalized with a total risk-based capital ratio of 19.33%, a Tier 1 leverage capital ratio of 12.01%, a tangible common equity to tangible assets ratio (non-GAAP) of 11.79%, and a shareholders’ equity to total assets ratio of 12.51% at
Asset Quality
Timberland’s non-performing assets to total assets ratio was 0.19% at
Total delinquent loans (past due 30 days or more) and non-accrual loans increased
Non-Accrual Loans ($ in thousands) | ||||||||||||||||||
Amount | Quantity | Amount | Quantity | Amount | Quantity | |||||||||||||
Mortgage loans: | ||||||||||||||||||
One- to four-family | $ | 380 | 3 | $ | 602 | 4 | $ | 378 | 2 | |||||||||
Commercial | 1,149 | 3 | 683 | 2 | 694 | 2 | ||||||||||||
Construction – custom and owner/builder | 152 | 1 | 150 | 1 | -- | -- | ||||||||||||
Land | -- | -- | -- | -- | 362 | 1 | ||||||||||||
Total mortgage loans | 1,681 | 7 | 1,435 | 7 | 1,434 | 5 | ||||||||||||
Consumer loans: | ||||||||||||||||||
Home equity and second mortgage | 165 | 1 | 171 | 1 | 241 | 2 | ||||||||||||
Other | -- | -- | -- | -- | 1 | 1 | ||||||||||||
Total consumer loans | 165 | 1 | 171 | 1 | 242 | 3 | ||||||||||||
Commercial business loans | 1,759 | 6 | 1,760 | 6 | 293 | 4 | ||||||||||||
Total loans | $ | 3,605 | 14 | $ | 3,366 | 14 | $ | 1,969 | 12 |
About
Disclaimer
Certain matters discussed in this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to our financial condition, results of operations, plans, objectives, future performance or business. Forward-looking statements are not statements of historical fact, are based on certain assumptions and often include the words "believes," "expects," "anticipates," "estimates," "forecasts," "intends," "plans," "targets," "potentially," "probably," "projects," "outlook" or similar expressions or future or conditional verbs such as "may," "will," "should," "would" and "could." Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, assumptions and statements about future economic performance. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from the results anticipated or implied by our forward-looking statements, including, but not limited to: potential adverse impacts to economic conditions in our local market areas, other markets where the Company has lending relationships, or other aspects of the Company's business operations or financial markets, including, without limitation, as a result of employment levels, labor shortages and the effects of inflation, a potential recession or slowed economic growth caused by increasing geopolitical instability (including wars, conflicts, terrorist attacks, natural disasters, and other unexpected events outside of our control), as well as increasing oil prices and supply chain disruptions, and any governmental or societal responses to novel coronavirus disease 2019 ("COVID-19") pandemic, including the possibility of new COVID-19 variants; credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs and changes in our allowance for loan losses and provision for loan losses that may be impacted by deterioration in the housing and commercial real estate markets which may lead to increased losses and non-performing loans in our loan portfolio may result in our allowance for loan losses not being adequate to cover actual losses, and require us to materially increase our loan loss reserves; changes in general economic conditions, either nationally or in our market areas; changes in the levels of general interest rates, and the relative differences between short and long-term interest rates, deposit interest rates, our net interest margin and funding sources; uncertainty regarding the future of the London Interbank Offered Rate ("LIBOR"), and the transition away from LIBOR toward new interest rate benchmarks; fluctuations in the demand for loans, the number of unsold homes, land and other properties and fluctuations in real estate values in our market areas; secondary market conditions for loans and our ability to sell loans in the secondary market; results of examinations of us by the
Any of the forward-looking statements that we make in this press release and in the other public statements we make are based upon management's beliefs and assumptions at the time they are made. We do not undertake and specifically disclaim any obligation to publicly update or revise any forward-looking statements included in this press release to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking statements discussed in this document might not occur and we caution readers not to place undue reliance on any forward-looking statements. These risks could cause our actual results for fiscal 2024 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, us, and could negatively affect the Company's consolidated financial condition and results of operations as well as its stock price performance.
CONSOLIDATED STATEMENTS OF INCOME | Three Months Ended | ||||||||||||
($ in thousands, except per share amounts) (unaudited) | |||||||||||||
2024 | 2023 | 2023 | |||||||||||
Interest and dividend income | |||||||||||||
Loans receivable | $ | 18,909 | $ | 18,395 | $ | 14,950 | |||||||
Investment securities | 2,246 | 2,311 | 2,460 | ||||||||||
Dividends from mutual funds, FHLB stock and other investments | 82 | 91 | 64 | ||||||||||
Interest bearing deposits in banks | 1,919 | 1,699 | 1,913 | ||||||||||
Total interest and dividend income | 23,156 | 22,496 | 19,387 | ||||||||||
Interest expense | |||||||||||||
Deposits | 7,301 | 6,143 | 2,236 | ||||||||||
Borrowings | 220 | 349 | -- | ||||||||||
Total interest expense | 7,521 | 6,492 | 2,236 | ||||||||||
Net interest income | 15,635 | 16,004 | 17,151 | ||||||||||
Provision for credit losses – loans | 166 | 379 | 475 | ||||||||||
Provision for (recapture of ) credit losses – investment securities | 3 | (10 | ) | -- | |||||||||
Recapture of credit losses - unfunded commitments | (88 | ) | (33 | ) | -- | ||||||||
Net int. income after provision for (recapture of) credit losses | 15,554 | 15,668 | 16,676 | ||||||||||
Non-interest income | |||||||||||||
Service charges on deposits | 988 | 1,023 | 893 | ||||||||||
ATM and debit card interchange transaction fees | 1,212 | 1,264 | 1,275 | ||||||||||
Gain on sales of loans, net | 41 | 78 | 46 | ||||||||||
Bank owned life insurance (“BOLI”) net earnings | 156 | 156 | 157 | ||||||||||
Recoveries on investment securities, net | 2 | 5 | 2 | ||||||||||
Other | 216 | 272 | 263 | ||||||||||
Total non-interest income, net | 2,615 | 2,798 | 2,636 | ||||||||||
Non-interest expense | |||||||||||||
Salaries and employee benefits | 6,024 | 5,911 | 6,046 | ||||||||||
Premises and equipment | 1,081 | 973 | 1,001 | ||||||||||
Advertising | 159 | 186 | 178 | ||||||||||
ATM and debit card processing | 601 | 615 | 489 | ||||||||||
Postage and courier | 145 | 126 | 147 | ||||||||||
State and local taxes | 325 | 319 | 298 | ||||||||||
Professional fees | 319 | 253 | 473 | ||||||||||
206 | 210 | 202 | |||||||||||
Loan administration and foreclosure | 134 | 105 | 138 | ||||||||||
Technology and communication expense | 1,040 | 974 | 880 | ||||||||||
Deposit operations | 324 | 320 | 246 | ||||||||||
Amortization of core deposit intangible (“CDI”) | 57 | 56 | 67 | ||||||||||
Other, net | 576 | 576 | 779 | ||||||||||
Total non-interest expense, net | 10,991 | 10,624 | 10,944 | ||||||||||
Income before income taxes | 7,178 | 7,842 | 8,368 | ||||||||||
Provision for income taxes | 1,470 | 1,546 | 1,705 | ||||||||||
Net income | $ | 5,708 | $ | 6,296 | $ | 6,663 | |||||||
Net income per common share: | |||||||||||||
Basic | $ | 0.71 | $ | 0.78 | $ | 0.81 | |||||||
Diluted | 0.70 | 0.77 | 0.80 | ||||||||||
Weighted average common shares outstanding: | |||||||||||||
Basic | 8,081,924 | 8,114,209 | 8,220,532 | ||||||||||
Diluted | 8,121,109 | 8,166,048 | 8,304,370 |
CONSOLIDATED STATEMENTS OF INCOME | Six Months Ended | ||||||||||||
($ in thousands, except per share amounts) (unaudited) | |||||||||||||
2024 | 2023 | ||||||||||||
Interest and dividend income | |||||||||||||
Loans receivable | $ | 37,304 | $ | 29,407 | |||||||||
Investment securities | 4,556 | 4,674 | |||||||||||
Dividends from mutual funds, FHLB stock and other investments | 173 | 115 | |||||||||||
Interest bearing deposits in banks | 3,618 | 4,304 | |||||||||||
Total interest and dividend income | 45,651 | 38,500 | |||||||||||
Interest expense | |||||||||||||
Deposits | 13,444 | 3,606 | |||||||||||
Borrowings | 568 | -- | |||||||||||
Total interest expense | 14,012 | 3,606 | |||||||||||
Net interest income | 31,639 | 34,894 | |||||||||||
Provision for credit losses – loans | 545 | 1,000 | |||||||||||
Recapture of credit losses – investment securities | (7 | ) | -- | ||||||||||
Recapture of credit losses - unfunded commitments | (121 | ) | -- | ||||||||||
Net int. income after provision for (recapture of) credit losses | 31,222 | 33,894 | |||||||||||
Non-interest income | |||||||||||||
Service charges on deposits | 2,011 | 1,840 | |||||||||||
ATM and debit card interchange transaction fees | 2,476 | 2,526 | |||||||||||
Gain on sales of loans, net | 120 | 67 | |||||||||||
Bank owned life insurance (“BOLI”) net earnings | 312 | 313 | |||||||||||
Recoveries on investment securities, net | 7 | 5 | |||||||||||
Other | 487 | 590 | |||||||||||
Total non-interest income, net | 5,413 | 5,341 | |||||||||||
Non-interest expense | |||||||||||||
Salaries and employee benefits | 11,936 | 11,946 | |||||||||||
Premises and equipment | 2,054 | 1,925 | |||||||||||
Advertising | 345 | 372 | |||||||||||
ATM and debit card processing | 1,216 | 972 | |||||||||||
Postage and courier | 271 | 268 | |||||||||||
State and local taxes | 644 | 597 | |||||||||||
Professional fees | 572 | 902 | |||||||||||
416 | 326 | ||||||||||||
Loan administration and foreclosure | 239 | 259 | |||||||||||
Technology and telecommunications | 2,014 | 1,668 | |||||||||||
Deposit operations | 644 | 592 | |||||||||||
Amortization of CDI | 113 | 135 | |||||||||||
Other, net | 1,151 | 1,517 | |||||||||||
Total non-interest expense, net | 21,615 | 21,479 | |||||||||||
Income before income taxes | 15,020 | 17,756 | |||||||||||
Provision for income taxes | 3,016 | 3,587 | |||||||||||
Net income | $ | 12,004 | $ | 14,169 | |||||||||
Net income per common share: | |||||||||||||
Basic | $ | 1.48 | $ | 1.72 | |||||||||
Diluted | 1.47 | 1.70 | |||||||||||
Weighted average common shares outstanding: | |||||||||||||
Basic | 8,098,155 | 8,226,467 | |||||||||||
Diluted | 8,143,701 | 8,311,630 |
CONSOLIDATED BALANCE SHEETS | ||||||||||||
($ in thousands, except per share amounts) (unaudited) | ||||||||||||
2024 | 2023 | 2023 | ||||||||||
Assets | ||||||||||||
Cash and due from financial institutions | $ | 22,310 | $ | 28,656 | $ | 26,015 | ||||||
Interest-bearing deposits in banks | 158,039 | 129,365 | 116,468 | |||||||||
Total cash and cash equivalents | 180,349 | 158,021 | 142,483 | |||||||||
Certificates of deposit (“CDs”) held for investment, at cost | 11,204 | 12,449 | 20,168 | |||||||||
Investment securities: | ||||||||||||
Held to maturity, at amortized cost (net of ACL – investment securities) | 211,818 | 266,085 | 277,911 | |||||||||
Available for sale, at fair value | 61,746 | 40,446 | 54,838 | |||||||||
Investments in equity securities, at fair value | 839 | 848 | 850 | |||||||||
FHLB stock | 2,037 | 2,001 | 2,202 | |||||||||
Other investments, at cost | 3,000 | 3,000 | 3,000 | |||||||||
Loans held for sale | 1,311 | 1,425 | 200 | |||||||||
Loans receivable | 1,375,934 | 1,352,938 | 1,224,891 | |||||||||
Less: ACL – loans | (16,818 | ) | (16,655 | ) | (14,698 | ) | ||||||
Net loans receivable | 1,359,116 | 1,336,283 | 1,210,193 | |||||||||
Premises and equipment, net | 21,718 | 21,584 | 21,744 | |||||||||
BOLI | 23,278 | 23,122 | 23,119 | |||||||||
Accrued interest receivable | 7,108 | 6,731 | 5,295 | |||||||||
15,131 | 15,131 | 15,131 | ||||||||||
CDI | 564 | 621 | 813 | |||||||||
Loan servicing rights, net | 1,717 | 1,925 | 2,535 | |||||||||
Operating lease right-of-use assets | 1,624 | 1,698 | 1,844 | |||||||||
Other assets | 4,674 | 3,745 | 4,292 | |||||||||
Total assets | $ | 1,907,234 | $ | 1,895,115 | $ | 1,786,618 | ||||||
Liabilities and shareholders’ equity | ||||||||||||
Deposits: Non-interest-bearing demand | $ | 424,906 | $ | 433,065 | $ | 479,283 | ||||||
Deposits: Interest-bearing | 1,213,648 | 1,194,004 | 1,069,484 | |||||||||
Total deposits | 1,638,554 | 1,627,069 | 1,548,767 | |||||||||
Operating lease liabilities | 1,723 | 1,796 | 1,935 | |||||||||
FHLB borrowings | 20,000 | 20,000 | -- | |||||||||
Other liabilities and accrued expenses | 8,278 | 8,881 | 8,255 | |||||||||
Total liabilities | 1,668,555 | 1,657,746 | 1,558,957 | |||||||||
Shareholders’ equity | ||||||||||||
Common stock, 8,023,121 shares issued and outstanding – 8,120,708 shares issued and outstanding – 8,203,174 shares issued and outstanding – | 32,338 | 34,869 | 37,979 | |||||||||
Retained earnings | 207,086 | 203,327 | 190,177 | |||||||||
Accumulated other comprehensive loss | (745 | ) | (827 | ) | (495 | ) | ||||||
Total shareholders’ equity | 238,679 | 237,369 | 227,661 | |||||||||
Total liabilities and shareholders’ equity | $ | 1,907,234 | $ | 1,895,115 | $ | 1,786,618 |
Three Months Ended | ||||||||||||
PERFORMANCE RATIOS: | 2024 | 2023 | 2023 | |||||||||
Return on average assets (a) | 1.22 | % | 1.36 | % | 1.48 | % | ||||||
Return on average equity (a) | 9.67 | % | 10.75 | % | 11.86 | % | ||||||
Net interest margin (a) | 3.48 | % | 3.60 | % | 3.99 | % | ||||||
Efficiency ratio | 60.22 | % | 56.50 | % | 55.31 | % | ||||||
Six Months Ended | ||||||||||||
PERFORMANCE RATIOS: | 2024 | 2023 | ||||||||||
Return on average assets (a) | 1.28 | % | 1.55 | % | ||||||||
Return on average equity (a) | 10.18 | % | 12.74 | % | ||||||||
Net interest margin (a) | 3.53 | % | 4.02 | % | ||||||||
Efficiency ratio | 58.34 | % | 53.38 | % | ||||||||
Three Months Ended | ||||||||||||
ASSET QUALITY RATIOS AND DATA: | 2024 | 2023 | 2023 | |||||||||
Non-accrual loans | $ | 3,605 | $ | 3,366 | $ | 1,969 | ||||||
Loans past due 90 days and still accruing | -- | -- | -- | |||||||||
Non-performing investment securities | 79 | 85 | 93 | |||||||||
OREO and other repossessed assets | -- | -- | -- | |||||||||
Total non-performing assets (b) | $ | 3,684 | $ | 3,451 | $ | 2,062 | ||||||
Non-performing assets to total assets (b) | 0.19 | % | 0.18 | % | 0.12 | % | ||||||
Net charge-offs (recoveries) during quarter | $ | 3 | $ | 2 | $ | 6 | ||||||
Allowance for credit losses - loans to non-accrual loans, | 467 | % | 495 | % | 746 | % | ||||||
Allowance for credit losses - loans to loans receivable (c) | 1.22 | % | 1.23 | % | 1.20 | % | ||||||
CAPITAL RATIOS: | ||||||||||||
Tier 1 leverage capital | 12.01 | % | 12.14 | % | 11.95 | % | ||||||
Tier 1 risk-based capital | 18.08 | % | 18.22 | % | 18.16 | % | ||||||
Common equity Tier 1 risk-based capital | 18.08 | % | 18.22 | % | 18.16 | % | ||||||
Total risk-based capital | 19.33 | % | 19.50 | % | 19.41 | % | ||||||
Tangible common equity to tangible assets (non-GAAP) | 11.79 | % | 11.79 | % | 11.96 | % | ||||||
BOOK VALUES: | ||||||||||||
Book value per common share | $ | 29.75 | $ | 29.23 | $ | 27.75 | ||||||
Tangible book value per common share (d) | 27.79 | 27.29 | 25.81 |
_____________________________________
(a) Annualized
(b) Non-performing assets include non-accrual loans, loans past due 90 days and still accruing, non-performing investment securities and OREO and other repossessed assets.
(c) Does not include loans held for sale and is before the allowance for loan losses.
(d) Tangible common equity divided by common shares outstanding (non-GAAP).
AVERAGE BALANCES, YIELDS, AND RATES - QUARTERLY
($ in thousands)
(unaudited)
For the Three Months Ended | ||||||||||||||||||||
March 31, 2023 | ||||||||||||||||||||
Amount | Rate | Amount | Rate | Amount | Rate | |||||||||||||||
Assets | ||||||||||||||||||||
Loans receivable and loans held for sale | $ | 1,365,417 | 5.57 | % | $ | 1,332,971 | 5.52 | % | $ | 1,200,872 | 4.98 | % | ||||||||
Investment securities and FHLB stock (1) | 298,003 | 3.14 | 317,164 | 3.03 | 340,317 | 2.97 | ||||||||||||||
Interest-earning deposits in banks and CDs | 143,121 | 5.39 | 126,253 | 5.38 | 177,748 | 4.30 | ||||||||||||||
Total interest-earning assets | 1,806,541 | 5.16 | 1,776,388 | 5.07 | 1,718,937 | 4.51 | ||||||||||||||
Other assets | 81,337 | 81,612 | 84,072 | |||||||||||||||||
Total assets | $ | 1,887,878 | $ | 1,858,000 | $ | 1,803,009 | ||||||||||||||
Liabilities and Shareholders’ Equity | ||||||||||||||||||||
NOW checking accounts | $ | 367,924 | 1.61 | % | $ | 376,682 | 1.51 | % | $ | 412,642 | 0.83 | % | ||||||||
Money market accounts | 270,623 | 3.14 | 224,939 | 2.34 | 218,718 | 0.68 | ||||||||||||||
Savings accounts | 214,233 | 0.23 | 220,042 | 0.22 | 274,877 | 0.14 | ||||||||||||||
Certificates of deposit accounts | 295,202 | 4.16 | 268,628 | 3.97 | 170,547 | 2.22 | ||||||||||||||
Brokered CDs | 40,402 | 5.40 | 42,725 | 5.38 | -- | -- | ||||||||||||||
Total interest-bearing deposits | 1,188,384 | 2.47 | 1,133,016 | 2.18 | 1,076,784 | 0.84 | ||||||||||||||
Borrowings | 20,001 | 4.42 | 28,804 | 4.81 | 6 | 5.43 | ||||||||||||||
Total interest-bearing liabilities | 1,208,385 | 2.50 | 1,161,820 | 2.22 | 1,076,790 | 0.84 | ||||||||||||||
Non-interest-bearing demand deposits | 431,826 | 450,027 | 492,294 | |||||||||||||||||
Other liabilities | 10,182 | 11,878 | 9,136 | |||||||||||||||||
Shareholders’ equity | 237,485 | 234,275 | 224,789 | |||||||||||||||||
Total liabilities and shareholders’ equity | $ | 1,887,878 | $ | 1,858,000 | $ | 1,803,009 | ||||||||||||||
Interest rate spread | 2.66 | % | 2.85 | % | 3.67 | % | ||||||||||||||
Net interest margin (2) | 3.48 | % | 3.60 | % | 3.99 | % | ||||||||||||||
Average interest-earning assets to average interest-bearing liabilities | 149.50 | % | 152.90 | % | 159.64 | % |
_____________________________________
(1) Includes other investments
(2) Net interest margin = annualized net interest income / average interest-earning assets
For the Six Months Ended | ||||||||||||||||||||
March 31, 2024 | March 31, 2023 | |||||||||||||||||||
Amount | Rate | Amount | Rate | |||||||||||||||||
Assets | ||||||||||||||||||||
Loans receivable and loans held for sale | $ | 1,349,105 | 5.53 | % | $ | 1,182,420 | 4.97 | % | ||||||||||||
Investment securities and FHLB stock (1) | 307,636 | 3.08 | 332,815 | 2.88 | ||||||||||||||||
Interest-earning deposits in banks and CDs | 134,643 | 5.37 | 222,569 | 3.87 | ||||||||||||||||
Total interest-earning assets | 1,791,384 | 5.10 | 1,737,804 | 4.43 | ||||||||||||||||
Other assets | 81,473 | 86,171 | ||||||||||||||||||
Total assets | $ | 1,872,857 | $ | 1,823,975 | ||||||||||||||||
Liabilities and Shareholders’ Equity | ||||||||||||||||||||
NOW checking accounts | $ | 372,327 | 1.56 | % | $ | 426,345 | 0.63 | % | ||||||||||||
Money market accounts | 247,656 | 2.78 | 229,185 | 0.60 | ||||||||||||||||
Savings accounts | 217,153 | 0.23 | 277,382 | 0.13 | ||||||||||||||||
Certificates of deposit accounts | 281,842 | 4.07 | 152,814 | 1.84 | ||||||||||||||||
Brokered CDs | 41,570 | 5.39 | -- | -- | ||||||||||||||||
Total interest-bearing deposits | 1,160,548 | 2.32 | 1,085,726 | 0.67 | ||||||||||||||||
Borrowings | 24,427 | 4.65 | 3 | 5.43 | ||||||||||||||||
Total interest-bearing liabilities | 1,184,975 | 2.37 | 1,085,729 | 0.67 | ||||||||||||||||
Non-interest-bearing demand deposits | 440,976 | 505,949 | ||||||||||||||||||
Other liabilities | 11,035 | 9,813 | ||||||||||||||||||
Shareholders’ equity | 235,871 | 222,484 | ||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 1,872,857 | $ | 1,823,975 | ||||||||||||||||
Interest rate spread | 2.73 | % | 3.76 | % | ||||||||||||||||
Net interest margin (2) | 3.53 | % | 4.02 | % | ||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities | 151.17 | % | 160.06 | % |
_____________________________________
(1) Includes other investments
(2) Net interest margin = annualized net interest income / average interest-earning assets
Non-GAAP Financial Measures
In addition to results presented in accordance with GAAP, this press release contains certain non-GAAP financial measures. Timberland believes that certain non-GAAP financial measures provide investors with information useful in understanding the Company’s financial performance; however, readers of this report are urged to review these non-GAAP financial measures in conjunction with GAAP results as reported.
Financial measures that exclude intangible assets are non-GAAP measures. To provide investors with a broader understanding of capital adequacy, Timberland provides non-GAAP financial measures for tangible common equity, along with the GAAP measure. Tangible common equity is calculated as shareholders’ equity less goodwill and CDI. In addition, tangible assets equal total assets less goodwill and CDI.
The following table provides a reconciliation of ending shareholders’ equity (GAAP) to ending tangible shareholders’ equity (non-GAAP) and ending total assets (GAAP) to ending tangible assets (non-GAAP).
($ in thousands) | ||||||||||||
Shareholders’ equity | $ | 238,679 | $ | 237,369 | $ | 227,661 | ||||||
Less goodwill and CDI | (15,695 | ) | (15,752 | ) | (15,944 | ) | ||||||
Tangible common equity | $ | 222,984 | $ | 221,617 | $ | 211,717 | ||||||
Total assets | $ | 1,907,234 | $ | 1,895,115 | $ | 1,786,618 | ||||||
Less goodwill and CDI | (15,695 | ) | (15,752 | ) | (15,944 | ) | ||||||
Tangible assets | $ | 1,891,539 | $ | 1,879,363 | $ | 1,770,674 |
Contact: | |
(360) 533-4747 | |
www.timberlandbank.com |
Source:
2024 GlobeNewswire, Inc., source