HUNTINGTON, Ind., Jan. 23, 2024 /PRNewswire/ -- Northeast Indiana Bancorp, Inc. (OTCQB: NIDB), the parent company of First Federal Savings Bank, today announced net income for the full year of 2023 was $4.3 million, or $1.77 per diluted common share, compared to net income of $6.6 million, or $2.73 per diluted common share for the full year of 2022. The annual earnings of 2023 equate to a return on average assets (ROA) ratio of 0.90% and a return on average equity (ROE) ratio of 9.72% compared to ROA of 1.54% and ROE of 14.90% for the full year of 2022.
Net income for the fourth quarter ended December 31, 2023 was $741,000, or $0.31 per diluted common share, compared to net income of $1.6 million, or $0.65 per diluted common share for the fourth quarter ended December 31, 2022. The current quarter earnings equate to an annualized ROA of 0.60% and an annualized ROE of 6.75% compared to an annualized ROA of 1.42% and an annualized ROE of 14.84% for the fourth quarter ended December 31, 2022.
Factoring into the decline of net income was margin pressure throughout 2023 leading to a reduction in net interest income of $730,000 compared to the same period in 2022. Provision expenses increased by $1.1 million as implementation of the new CECL accounting standard during the year required the bank to increase the allowance for loan loss reserve to account for its strong loan growth in 2023. Overhead expenses increased by $1.1 million during 2023 with employee compensation and benefits higher by $650,000 as compared to 2022.
Total Assets increased $53.2 million to $498.7 million at December 31, 2023 compared to $445.5 million at December 31, 2022. This increase was primarily due to net loans increasing $49.9 million, or 15.6% in 2023, to $370.7 million as of December 31, 2023 compared to $320.8 million as of December 31, 2022. Total deposits increased $34.3 million, or 9.3% in 2023, to $401.1 million at December 31, 2023 compared to $366.8 million at December 31, 2022. Stockholder's equity increased $3.3 million to $46.4 million at December 31, 2023 compared to $43.1 million at December 31, 2022. Contributing to this increase was a $1.5 million improvement in the bank's net unrealized loss position in the investment portfolio. The book value of NIDB's stock was $19.15 per common share and the tangible common equity ratio was 9.31% as of December 31, 2023.
In the current year, Northeast Indiana Bancorp and First Federal Savings Bank have been recognized for its performance. First Federal Savings Bank was named to American Banker Magazine's Top 200 Community Banks for the 12th consecutive year for 2022. The magazine qualifies banks for this listing if they have less than $2 billion in total assets and are publicly traded. FFSB came in at #59 on this year's list of the top 200 publicly traded community banks. This is a 3-spot improvement from #62 in 2021. The magazine ranked the institutions based on the profitability metric, Return on Average Equity, over a 3-year period. Only 11 banks from the state of Indiana made this elite list and First Federal Savings Bank ranked 3rd in the State.
In addition, Northeast Indiana Bancorp, Inc., the holding company for First Federal Savings Bank, maintained its position on the Dividend Champions List. To achieve Champion status, a company must increase its dividend payments to its shareholders for 25 consecutive years. Northeast Indiana Bancorp is one of 150 companies in the United States to achieve this status and one of five companies from Indiana. With the latest dividend increase in the fourth quarter of 2023, Northeast Indiana Bancorp has increased dividends 29 years in a row.
Michael Zahn, President and CEO, states "The Bank had another strong year despite the challenging interest rate environment and implementation of new accounting rules as it relates to our loan loss reserve. I'm very pleased with our loan and deposit growth and the recognitions we continue to receive. Our team is second to none and provides exceptional service to our customers and communities. We will continue to invest in talent as we grow. Our dedication to community banking is the cornerstone of who we are and drives our continued goal of enhancing shareholder value moving forward."
*All share data has been adjusted to reflect Northeast Indiana Bancorp, Inc.'s two-for-one stock split effective July 14, 2023 .
Northeast Indiana Bancorp, Inc. is headquartered at 648 N. Jefferson Street, Huntington, Indiana. The company offers a full array of banking and financial brokerage services to its customers through its main office in Huntington and six full-service Indiana offices in Huntington (2), Warsaw (2) and Fort Wayne (2). The Company is traded on the OTC Markets Group, Inc. (www.otcmarkets.com) utilizing the OTCQB platform under the symbol "NIDB". Our web site address is www.firstfedindiana.bank.
This press release may contain forward-looking statements, which are based on management's current expectations regarding economic, legislative and regulatory issues. Factors which may cause future results to vary materially include, but are not limited to, general economic conditions, changes in interest rates, loan demand, and competition. Additional factors include changes in accounting principles, policies or guidelines; changes in legislation or regulation; and other economic, competitive, regulatory and technological factors affecting each company's operations, pricing, products and services.
NORTHEAST INDIANA BANCORP | |||||||
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |||||||
December 31, | December 31, | ||||||
Balance Sheet (Unaudited) | 2023 | 2022 | |||||
(Audited) | |||||||
Assets | |||||||
Non-interest earning cash and cash equivalents | $ 4,304,296 | $ 3,141,705 | |||||
Interest-earning cash and cash equivalents | 1,166,180 | 747,920 | |||||
Total cash and cash equivalents | 5,470,476 | 3,889,625 | |||||
Interest-earning time deposits | 4,320,000 | 1,230,000 | |||||
Securities available for sale | 76,228,755 | 78,273,337 | |||||
Securities held to maturity | 12,754,763 | 12,062,446 | |||||
Loans held for sale | - | 189,600 | |||||
Loans, gross | 375,992,822 | 324,752,497 | |||||
Allowance for loan losses | (5,335,305) | (3,996,619) | |||||
Loans, net | 370,657,517 | 320,755,878 | |||||
Accrued interest receivable | 2,354,636 | 1,923,986 | |||||
Premises and equipment | 7,366,169 | 7,254,951 | |||||
FHLB Stock | 2,227,500 | 2,101,600 | |||||
Investment in limited partnerships | 928,334 | 1,228,334 | |||||
Cash surrender value of life insurance | 11,751,653 | 11,629,618 | |||||
Other assets | 4,624,206 | 4,988,219 | |||||
Total Assets | $ 498,684,009 | $ 445,527,594 | |||||
Liabilities and Stockholders' Equity | |||||||
Non-interest bearing deposits | $ 54,764,981 | $ 53,232,315 | |||||
Interest bearing deposits | 346,307,200 | 313,584,014 | |||||
Borrowed funds | 47,250,000 | 32,000,000 | |||||
Accrued interest payable and other liabilities | 3,941,438 | 3,584,163 | |||||
Total Liabilities | 452,263,619 | 402,400,492 | |||||
Stockholders' equity | 46,420,390 | 43,127,102 | |||||
Total Liabilities and Stockholders' Equity | $ 498,684,009 | $ 445,527,594 | |||||
Three months ended | Twelve months ended | ||||||
December 31, | September 30, | December 31, | December 31, | December 31, | |||
Income Statement (Unaudited) | 2023 | 2023 | 2022 | 2023 | 2022 | ||
Net interest income | |||||||
Total interest income | $ 6,702,608 | $ 6,354,262 | $ 5,071,415 | $ 24,158,344 | $ 17,551,740 | ||
Total interest expense | 2,952,000 | 2,610,737 | 1,120,123 | 9,584,701 | 2,244,786 | ||
Net interest income | 3,750,608 | 3,743,525 | 3,951,292 | 14,573,643 | 15,306,954 | ||
Provision for loan losses | 780,000 | 90,000 | - | 1,050,000 | - | ||
Net interest income after provision for loan losses | 2,970,608 | 3,653,525 | 3,951,292 | 13,523,643 | 15,306,954 | ||
Non-interest income | |||||||
Service charges on deposit accounts | 184,623 | 184,111 | 198,715 | 734,612 | 741,330 | ||
Interchange fees | 195,918 | 199,248 | 193,610 | 787,690 | 784,129 | ||
Loan servicing fees | 108,432 | 102,753 | 62,712 | 414,958 | 354,009 | ||
Net gain on sale of loans | 67,979 | 115,722 | 66,083 | 329,174 | 613,364 | ||
Brokerage fees | 29,086 | 44,957 | 41,034 | 184,326 | 203,357 | ||
Increase in cash surrender value of life insurance | 75,763 | 74,217 | 74,955 | 296,990 | 297,677 | ||
Other income | 73,390 | 37,652 | 102,248 | 458,274 | 350,771 | ||
Total non-interest income | 735,191 | 758,660 | 739,357 | 3,206,024 | 3,344,637 | ||
Non-interest expense | |||||||
Salaries and employee benefits | 1,443,480 | 1,604,968 | 1,513,293 | 6,416,398 | 5,768,201 | ||
Occupancy | 340,005 | 330,735 | 383,944 | 1,381,140 | 1,368,039 | ||
Data processing | 387,894 | 397,132 | 371,655 | 1,573,667 | 1,461,156 | ||
Deposit insurance premiums | 54,000 | 46,000 | 28,500 | 205,500 | 116,000 | ||
Professional fees | 207,204 | 173,208 | 138,903 | 634,672 | 479,529 | ||
Advertising and marketing fees | 129,495 | 13,909 | 89,021 | 311,634 | 268,029 | ||
Correspondent bank charges | 39,288 | 35,395 | 32,864 | 148,756 | 122,585 | ||
Other expense | 335,295 | 386,385 | 281,403 | 1,258,685 | 1,199,405 | ||
Total non-interest expense | 2,936,661 | 2,987,732 | 2,839,583 | 11,930,452 | 10,782,944 | ||
Income before income taxes | 769,138 | 1,424,453 | 1,851,066 | 4,799,215 | 7,868,647 | ||
Income tax expense | 27,866 | 193,172 | 298,062 | 539,525 | 1,316,051 | ||
Net income | $ 741,272 | $ 1,231,281 | $ 1,553,004 | $ 4,259,690 | $ 6,552,596 | ||
Three months ended | Twelve months ended | ||||||
December 31, | September 30, | December 31, | December 31, | December 31, | |||
Selected Financial Ratios and Other Financial Data (Unaudited) | 2023 | 2023 | 2022 | 2023 | 2022 | ||
Average shares outstanding - basic | 2,401,584 | 2,402,070 | 2,399,770 | 2,401,745 | 2,400,103 | ||
Average shares outstanding - diluted | 2,401,584 | 2,402,094 | 2,399,914 | 2,401,773 | 2,400,409 | ||
Basic earnings per share | $ 0.31 | $ 0.51 | $ 0.65 | $ 1.77 | $ 2.73 | ||
Diluted earnings per share | $ 0.31 | $ 0.51 | $ 0.65 | $ 1.77 | $ 2.73 | ||
Net interest margin | 3.16 % | 3.21 % | 3.73 % | 3.20 % | 3.76 % | ||
Return on average assets | 0.60 % | 1.02 % | 1.42 % | 0.90 % | 1.54 % | ||
Return on average equity | 6.75 % | 11.16 % | 14.84 % | 9.72 % | 14.90 % | ||
Efficiency ratio | 65.47 % | 66.36 % | 60.54 % | 67.10 % | 57.81 % | ||
Allowance for loan losses: | |||||||
Balance, beginning of period | $ 4,529,631 | $ 4,508,446 | $ 4,024,366 | $ 3,996,619 | $ 3,998,392 | ||
Charge-offs: | |||||||
One-to-four family | - | 21,457 | - | 27,466 | - | ||
Commercial real estate | - | - | - | - | - | ||
Land/land development | - | - | - | - | - | ||
Commercial | - | - | - | - | - | ||
Consumer | 68,491 | 73,324 | 60,866 | 198,755 | 139,976 | ||
Gross charge-offs | 68,491 | 94,781 | 60,866 | 226,221 | 139,976 | ||
Recoveries: | |||||||
One-to-four family | 10,664 | 586 | 13,099 | 11,249 | 15,689 | ||
Commercial real estate | - | - | 40 | - | 478 | ||
Land/land development | - | - | - | - | - | ||
Commercial | 200 | 600 | 185 | 3,930 | 49,910 | ||
Consumer | 38,301 | 24,780 | 19,795 | 104,728 | 72,126 | ||
Gross recoveries | 49,165 | 25,966 | 33,119 | 119,907 | 138,203 | ||
Net charge-offs (recoveries) | 19,326 | 68,815 | 27,747 | 106,314 | 1,773 | ||
CECL adjustment | - | - | - | 350,000 | - | ||
Provision for loan losses | 825,000 | 90,000 | - | 1,095,000 | - | ||
Balance, end of period | $ 5,335,305 | $ 4,529,631 | $ 3,996,619 | $ 5,335,305 | $ 3,996,619 | ||
Net loan charge-offs (recoveries) to average loans | 0.02 % | 0.08 % | 0.03 % | 0.03 % | 0.00 % | ||
As of | |||||||
December 31, | September 30, | December 31, | |||||
Non-performing assets | 2023 | 2023 | 2022 | ||||
Loans: | |||||||
Non-accrual | $ 6,415,623 | $ 3,667,841 | $ 2,463,911 | ||||
Past 90 days or more and still accruing | - | - | - | ||||
Troubled debt restructured | 524,970 | 524,970 | 525,383 | ||||
Total non-performing loans | 6,940,593 | 4,192,811 | 2,989,294 | ||||
Real estate owned | - | - | - | ||||
Other repossessed assets | - | - | - | ||||
Total non-performing assets | $ 6,940,593 | $ 4,192,811 | $ 2,989,294 | ||||
Non-performing assets to total assets | 1.39 % | 0.87 % | 0.67 % | ||||
Non-performing loans to gross loans | 1.85 % | 1.15 % | 0.92 % | ||||
Allowance for loan losses to non-performing loans | 76.87 % | 108.03 % | 133.70 % | ||||
Allowance for loan losses to gross loans | 1.42 % | 1.24 % | 1.23 % | ||||
Other financial ratios | |||||||
Tangible common equity | 9.31 % | 9.05 % | 9.68 % | ||||
Book value per share | $ 19.15 | $ 18.08 | $ 17.90 | ||||
Common shares outstanding | 2,423,698 | 2,425,670 | 2,409,670 | ||||
(1) Ratios for three-month periods are annualized | |||||||
(2) All share data has been adjusted for the 2:1 stock split on July 14, 2023. | |||||||
SOURCE Northeast Indiana Bancorp, Inc.
